WASHINGTON: It would be detrimental for the U.S. to look to punish India for policymaking decisions at a time when the world's largest democracy is electing a new government, a top American think-tank has said.
"Policymakers in some instances have less flexibility in initiating reviews or guiding outcomes. But in instances where we have flexibility, it is not in the U.S. interest to continue looking to punish India for policymaking decisions at a time those policymakers are leaving office," he cautioned the Obama Administration.
Rossow called on the U.S. to be prepared to engage with India on some "forward-looking" economic issues, so that the bilateral agenda is not completely saturated with complaints. Irrespective of who wins, there will be a dramatic leadership change, he said.
"Clearly with a BJP-led coalition, we will deal with an entirely new set of leaders. Even if Congress manages to surprise pundits and pull out a win, Prime Minister (Manmohan) Singh and Finance Minister (P) Chidambaram will not figure in the Cabinet. Economic policymaking will be left to a new team, and new areas for bilateral economic cooperation will surely emerge," he noted.Observing that there are at least half a dozen trade disputes between the two countries, including Special 301, WTO Dispute Settlement on India's Solar Mission and review of India's trade, investment and industrial policies, Rossow said other non-trade moves by the US are also lumped in with these actions by some Indian analysts, however unfairly.
These "non-trade" actions include the Federal Aviation Administration's downgrade of India's airline regulator and the Food and Drug Administration's ban on imports of generic pharmaceuticals from a few Indian producers.
While these are linked to India's non-compliance with specific targets instead of reactions to trade policies in India, they have also eroded the U.S.' image in India to some extent, Rossow said.
"While there is ample reason for each of these trade enforcement actions to be seriously considered, we must also recognise that negative reports and potential sanctions against India just after the election will paint the next government's perceptions about the United States," he said.