India and US Forge Economic Security Alliance to Counter China's Market Policies
In a significant diplomatic development, the India-US joint statement has prominently featured a mutual agreement to strengthen economic security alignment. This strategic move is aimed at enhancing supply chain resilience and fostering innovation through complementary actions by both nations.
Addressing Non-Market Policies and Investment Reviews
The joint statement explicitly addresses the need to counter "non-market policies of third parties," a tacit reference widely understood to point towards China. This terminology has been consistently employed by the United States, European Union, and G7 countries to highlight concerns regarding China's economic model.
China's economic approach, characterized by industrial overcapacity, export restrictions, dominance of state-owned enterprises, and substantial government subsidies, has raised global apprehensions about market distortions. By incorporating this language, India and the US are signaling a synchronized strategy to derisk and reduce China's overwhelming dominance in critical manufacturing sectors.
Focus on Semiconductors and Green Energy
The coordinated efforts specifically target areas where China has established substantial global control, including:
- Semiconductor manufacturing
- Green energy technologies
- Critical mineral supply chains
During the critical minerals meeting hosted by the United States this week, External Affairs Minister S. Jaishankar emphasized the challenges stemming from "excessive concentration" in global supply chains. He underscored the vital importance of de-risking these networks through structured international cooperation, aligning perfectly with the joint statement's objectives.
Building on Previous Commitments
This latest agreement builds upon commitments made during Prime Minister Narendra Modi's visit to the United States last year. As part of the TRUST (Transforming the Relationship Utilising Strategic Technology) initiative, both nations pledged to develop trusted and resilient supply chains. The current statement represents a concrete step forward in implementing that vision.
Strategic Implications for India and the Indo-Pacific
The willingness of both India and the United States to collaborate in countering Chinese economic influence sends a positive signal for New Delhi, particularly at a time when former President Donald Trump's commitment to the Indo-Pacific region appears uncertain. An early Quad summit, with Trump potentially visiting India as host, could help alleviate concerns about American engagement in the region.
With India-US trade differences resolved, at least temporarily, not only India but also key allies like Australia and Japan are eager for the Quad summit to proceed without further delay. This diplomatic alignment strengthens the collective position of democratic nations in the face of China's economic policies.
The India-US economic security partnership represents a strategic recalibration of global economic relationships, emphasizing resilience, transparency, and market-oriented principles over state-driven industrial policies.
