If the current global supply shortage is causing both consumers and industries economic pain, then the United States and its allies should prepare for the supply chain calamity that will happen should China make a move on Taiwan or exert greater control of the South China Sea.
Considering that 60 percent of the world’s semiconductors are manufactured by two companies in Taiwan and 20 percent by one company in South Korea, America must develop deeper partnerships with countries not so dependent on China’s geopolitical ambitions. A supply rupture in the semiconductor industry alone would spell disaster in the global economy.
Enter India. As it shares a disputed border with China, India must maintain the economic and military wherewithal to resist bullying by Beijing. India is in effect, like Taiwan, a second front to China. India will soon have the largest population in the world of over 1.4 billion people, half under the age of 25, many of whom will serve in the second-largest military and the world’s seventh-largest navy. Most importantly, India is a stable and well-established democracy accountable to its people through a system of checks and balances and disciplined state and federal elections.
Trade of goods and services between India’s largest export trading partner, the United States, is nearly $150 billion comprising industries that rely on sophisticated supply and manufacturing. For example, India’s second-largest export is pharmaceuticals. The service sector, driven by IT and software development outsourcing, has cooled slightly during the pandemic but continues to shine as a growth area as India’s over 1,000 universities churn out more than 1 million engineers per year. Precision manufacturing of products like semiconductors is a natural evolution for what is becoming a high-tech manufacturing giant.
Which brings us to how India can help the United States and the world become less reliant on China. Strategically, the United States must invest in India as an equal partner to bring balance to our dependence on outsourced global manufacturing and supplies of raw materials, finished goods and services. Whether it be steel for ships, vaccines and pharmaceuticals for disease, microchips for autos, or programmers for the software service sector, India can be a credible alternative to China.
Instead, the United States is risking its partnership with India by publicly saying it may sanction India because they chose as a national security priority to buy a highly sophisticated air defense system from Russia to defend themselves against an attack from China. This air defense system, called the S-400, is the same one China took delivery on from Russia in 2018. The United States feels compelled to impose sanctions because of a U.S. law called the Countering America’s Adversaries Through Sanctions Act (CAATSA), which in effect treats India as an adversary, which India is most definitely not. India has always purchased the majority of its defense equipment from Russia, which is likely to continue to decline over time. President BidenJoe BidenManchin to vote to nix Biden's vaccine mandate for larger businesses Congress averts shutdown after vaccine mandate fight Senate cuts deal to clear government funding bill MORE is authorized under the legislation to grant India a waiver. We should bear in mind the damage we caused to ourselves and our relations with India by imposing sanctions in 1998 following India’s testing of its own nuclear weapon.
One must understand why the Indians chose to purchase the S-400 system in the first place, which is to defend itself from China, which shares a 2,000-mile border with India called the “Line of Actual Control.” In 1962, the Chinese and Indians went to war over this disputed border, and in May 2020 both sides had a deadly skirmish there because of Chinese incursions and exercises along the border. Following these events, senior Indian military leaders pushed for accelerating the delivery of the air defense system from the Russians, a weapons system we do not presently offer.
Although it is in no one’s interest for China and India to go to war, it is in the global interest for India to be capable of defending itself against Chinese provocations and maintain the balance of power in the region. With India having modern military deterrents, China is less likely to be an aggressor to India or to India’s weaker neighbors like Bhutan and Nepal, who could easily suffer the same fate as Tibet.
While bilateral cooperation between the United States and India is paramount and already well-established over the past two decades, we applaud the heightened multilateral efforts between Australia, Japan, India and the United States in the Quad. By including them among America’s greatest military and economic partners, we build trust and cooperation with India, which historically has been non-aligned. In these times, it is critical that our friendship with India is built on meaningful action, such as the 2008 U.S.-India civil nuclear deal that cleared the way for India to meet its energy needs while keeping in place its strategic nuclear defense program.
Let’s work on the next big thing with New Delhi, such as a free trade agreement between the members of the Quad, to grow further India’s global manufacturing and supply capabilities, which will make the United States and the world safer and less dependent on China.
David C. Mulford is a former U.S. ambassador to India and Distinguished Visiting fellow at the Hoover Institution. John Rivera-Dirks is a former U.S. Diplomat to India and visiting fellow at the Hoover Institution.