New Delhi: Of all bilateral relations, the one with the United States is the most significant for India. This is true for the rest of the world as well, including major powers like Russia and China, and West European heavyweight states like the UK, France and Germany. Nevertheless, moving towards one power at the cost of some other rival powers has a special significance for India given its past policy of Non-Alignment. It is not that Non-Alignment is discredited but the circumstances no longer exist for its effective conduct. The world power system resembles the solar system in fundamental ways. Constituents have their orbits. They have satellites in sub-orbits. The United States is the warm sun at the Centre. Keeping close and friendly ties with the United States is not negotiable for India.

Difficult as President Donald Trump is, India has to swallow its pride and deal with him. Trump stunned the world by claiming that India had asked him to mediate on Kashmir with Pakistan. Denials notwithstanding, Trump’s claim is unforgettable. Some on the Indian side said it would hurt Indo-US relations. Had India chosen to play victim expecting something from the US in return (it is not clear what), Washington would have shrugged its shoulders and walked away. Better sense prevailed as India said it was moving on since Trump’s Kashmir statement. The US department of state responded appropriately.

The Indian economy has been a mess for the past five years. The first budget of the re-elected government seems intent on making a deeper mess of the economy. All economic fundamentals are down. The stock-market is in steady decline. Sectors like auto are bleeding and FMCG has never done as poorly in nearly seven quarters. The forty-three percent tax on the super-rich and foreign portfolio investors has triggered outflows amounting to $2 billion in July and more panic-stricken selloffs are expected in the coming days.

The Indian economy has no chance without investments and exports, and private investments will follow America’s lead, the world’s most capitalistic country, while Indian exports would be spurred by US free markets. The United States will not be interested in India as long as it is a high taxes and tariffs country. The forty-three percent tax is a scandal. Washington would also be sceptical of long-term economic partnership with India if New Delhi is forever tinkering with policies such as those related to e-commerce, data localization, etc. On both counts, India dared the United States by readying laws whose passage would have made any resolution messy and time-consuming. Media reports say the passage is deferred on account of trade and commercial negotiations with the United States.

It is best not to rile the United States on e-commerce rules and data localization. A level playing field will assist everyone. The 1991 reforms give that lesson. Similarly, high tariffs hurt the economy and hit growth. Nativist policies do not offer long term advantages. The US president wants free trade with India. That is only fair because the United States is the freest to trade with notwithstanding the tariffs selectively imposed by it as a warning. Opposing the United States on trade, however, will not hurt Washington as much as it will scupper the Indian economy. It is this which makes the US indispensible for India.

In the good old days of Non-Alignment, India could turn to the Soviet Union. Russia is not the Soviet Union, and it can no longer fulfil India’s priorities in areas other than defence, which bring their own problems of US sanctions. China, on the other hand, has been grievously hurt by Donald Trump’s trade war and would like India on its side without altering its fundamental hostility towards New Delhi to tilt the balance. China has a huge trade surplus with the United States (S480 billion) and a not insubstantial one with India ($63 billion). It reflects its protectionist mindset. China won’t open its market to Indian products although it keeps assuring it would. Besides, China has an alliance with Pakistan with all that it entails.

In befriending the United States, India does not have a choice. Relations are not smooth and to trade frictions are now added Kashmir. The United States will be looking to mediate. Cutting loose is not an option. The Indian economy needs the US like oxygen. Moreover, Russia cannot be the old Cold War ally and China cannot be trusted. Seeing its indispensability for India, the United States will turn the screws where it feels India is unyielding: On trade, Kashmir, etc. Too long has India resisted change and not yielded. Time and tide wait for no man.