“Developing an Indo-Pacific Economic Framework"
House Foreign Affairs Committee
March 1, 2022
Ambassador (ret.) Atul Keshap, President, U.S.-India Business Council, U.S. Chamber of Commerce
Thank you to the committee and Chairman Gregory Meeks and Ranking Member Mike McCaul for convening this hearing. It is an honor to address you as the new President of the U.S.- India Business Council at the U.S. Chamber of Commerce.
Over 40 years ago, the U.S. and Indian governments requested the creation of USIBC to promote stronger bilateral trade and investment between the two largest democracies in the world. Over the years, commerce has boomed between our two countries, and there is still immense scope to expand it further. Our members are working to accelerate inclusive growth and create millions of high-quality jobs across both nations—especially in research & development, the digital economy, health and life sciences, and clean energy technologies.
I address you in service of that mission, and as a retired U.S. ambassador with experience across the Indo-Pacific, including as our APEC envoy. On India, I appreciate the twenty years of sustained bipartisan effort to forge a stronger and multi-faceted relationship. Over the course of serving five administrations from both parties, I have seen early efforts to expand our thinking to encompass a holistic geography grow to a strong consensus recognizing the Indo-Pacific's centrality to our strategic interests and future prosperity.
It is long-past time for that centrality to be reflected in our trade doctrine. The rising economic power of our competitors and heating geopolitical conflict have given this matter a profound sense of urgency. I remain at heart an American diplomat, and I retain the characteristic optimism of our kind. But it would be naïve not to recognize a clear reality: there are forces that seek to distance the U.S. and India and weaken global democracy. If the great democracies cannot get our acts together to face down this threat, authoritarian regimes will write the rules of the 21st century—and we will live in a world that is poorer and crueler because of it.
Right now, the United States and our allies in the Indo-Pacific are navigating the challenges of a post-pandemic recovery—with high inflation, talent shortages, and supply chain bottlenecks. Our adversaries assume we lack both the economic confidence and capacity for coordination needed to counter these challenges, leading them to question our leadership on the world stage.
In the competition with authoritarianism, our ability to work with allies and like-minded partners, along with the prosperity, Ingenuity, and confidence of our people, will be our greatest assets. The Indo-Pacific Economic framework can be bolstered both by constructing a trade architecture that enables strategic cooperation and creates a secure supply chain for the free world, and by spearheading an abundance agenda that raises living standards for Americans and billions of friends in the region. As the world’s sixth largest and fastest growing economy, a site of both critical manufacturing capability and scalable research & development, robust demographics, and the world’s largest democracy, India will be an essential partner in generating mutual prosperity and creating a global free world supply chain.
To optimize its impact, the framework should enable the private sector to deliver. Our global technology companies will be the main players ensuring safe and reliable access to critical technology such as semi-conductors; it will be private equity firms and our financial institutions that will drive the capital necessary to fund climate resilient development. The incentives and actions of these players are set by, enabled, and limited by the trade architecture.
Trade is the muscle and sinew of our strategic relationships; the power of free enterprise advances the interests and values articulated by governments and citizens. The plain truth is that real trade arrangements that remove barriers, promote investment, and align regulatory approaches are the most effective way to enable the level of cooperation envisioned by the Indo-Pacific strategy and align our private sector partners with its goals. The Chamber has prepared business recommendations for the Indo Pacific Economic Framework and shared them with the Administration. We are happy to share them with the committee as well.
With this framework, we have an opportunity to overcome hesitation on trade and show our people what we can accomplish for them through expanding our economic partnerships with like-minded partners and allies. During the Cold War, we prioritized the economic confidence of our people, whose lives were so much more plentiful, free, and happy than our adversaries. We made the case for Democracy through our prosperity. Today, we have the opportunity and the need to do that once again, and this time through our friendship and cooperation with the region where almost half of humanity lives. Let’s have faith in our values, and in our friends, and move ahead with conviction and focus.