New Delhi: Assorted Indian officials anonymously insist that India will buy the S-400Triumf regardless of the threat of US secondary sanctions. They add recklessly and with vast presumptuousness that the United States would have to device a way to not sanction India.

What’s behind the gall? There is a feeling that India is indispensible for the United States’ containment of China. This begs the question if India would become a “frontline” state for the United States against China replicating Pakistan versus the Soviet Union during the first Afghanistan invasion. From the Indian perspective, the thought is scandalous. Geopolitically speaking, India is in no position to confront China, the only country in the region to share a highly militarized and disputed border with China. Independent India has not fought anyone’s war. Non-Alignment has seeped permanently into the Indian consciousness.

The United States understands this quite well although of course it would dearly wish that India changes course. China also knows that India is wedded to Non-Alignment. India would have to discover other means to insulate from US secondary sanctions. On its own, the United States is capable of taking on China. US warplanes and warships have commenced challenging Chinese claims to the South China Sea and the East China Sea. China has retaliated with tests of hypersonic planes. A Cuban Missile Crisis-like situation is building up in the international waters claimed by China. In an eyeball-to-eyeball situation, China will blink. It is already unhappily placed in the trade war with the United States. Manufacturing is hit and unemployment levels have risen. The purchasing managers’ index for China shows a steady decline.

Instead of tempting fate with Donald Trump’s America as China seems intent on doing, India would do better squarely to deal with the United States’ trade demands. They may still not insulate India from secondary sanctions in relation to Russia and Iran but it would, nevertheless, provide some leverage with Washington. Donald Trump is seeking a free trade agreement with India. His ambassador to India made that plain in his first public statement. Trump keeps hinting that India desires a bilateral trade deal with the United States. It would have to be an FTA although it could be called something else to preserve Indian sensitivities. An India-US FTA, however, can no longer be deferred.

The US economy is nearly ten times the size of the Indian one. Sectors that would be most vulnerable to an FTA are agriculture and pharmaceuticals. FTA critics argue that both sectors would be thrown into turmoil with the free entry of giant American producers and corporations. Other sectors more used to competition would also stir up trouble for a government considering an FTA with the US but agriculture would need special handling. Agriculture is the mainstay of rural India. Any FTA-induced disruption to agriculture would boomerang on the Central government responsible for bringing it. The Narendra Modi government is pusillanimous in such matters and would be loath to sign an FTA. It might agree to something less ambitious but that is scarcely likely to satisfy Donald Trump. At all events an FTA is ruled out till 2019. Negotiations could drag on for dozens of months. Yet, there seems no escape as long as Donald Trump is president and is also re-elected. Most likely an early replacement for Trump would also settle for nothing less since a path has been cleared.

This writer has a less apocalyptic view of FTA with the United States. The Indian economy has been jolted by Donald Trump’s protectionism. India is not alone. China, Western Europe and the United States’ closest trading partners in North America, Canada and Mexico, have all been traumatized by Trump’s America First policy. After much hostile rhetoric, the European Union has come around to negotiating with the United States. Mexico has fallen in line and so has Canada. China is holding out but at considerable cost. In a pincer move of containment, the United States is calling China’s economic/ trade and military bluffs. China’s mercantilism poses a threat to the world. No one will come to its support.

India does not have a fraction of China’s staying power. By putting curbs on IT guest workers, Trump has shaken the foundations of India’s technology companies. The tariffs on aluminium and steel are unaffordable in the long term for India. It can sue the United States for WTO violations but Trump’s America is hardly likely to take it in its stride. This is not the Barack Obama administration. And if in the midst of US trade grievances, India purchases the S-400, US secondary sanctions will automatically apply. An FTA could make the US more sympathetic to India’s defence requirements but it is still a gamble.

But there is a more positive way to view FTA. This writer sees it in the shape and form of second generation reforms. P. V. Narasimha Rao and Manmohan Singh’s 1991 reforms were met with no small scepticism and suspicion. The reigning argument was that India would not be able to prioritize manufacturing and services needs and that multinationals would set the agenda. If we are a $2 trillion economy, it is thanks to the vision of Narasimha Rao and Manmohan Singh. India has not become a potato chips economy as was feared. The reforms have been a leveller though not in the pernicious way the Bombay Club wanted.

An FTA with the United States would have to be structured and rolled out in a manner that it brings minimum pain to the most disadvantaged populations and fragile parts of the economy. Frankly, only an economist of the stature of Manmohan Singh could be trusted to lead the FTA talks and draw the maximum advantages for India. There will be pain but it would be good for the economy. India has stagnated since the 1991 reforms. It needs a decisive push. An in-principle decision for an FTA with the United States would calm the economy.