India’s recent elections demonstrated the resiliency of its democratic system, bringing to power a stable and strong government for the first time in over a decade.  Manmohan Singh was given a decisive mandate to continue as prime minister, while the Communists and various regional parties that had previously stalled reforms were rendered insignificant.

  Now, Singh’s agenda for liberalization can be implemented.

In many ways, Singh’s success will determine the economic trajectory of the country over the next few years.  However, several other issues may prove distracting.  The impact of the global recession on India’s economy and an increasingly unstable neighborhood, with turmoil in Pakistan and Sri Lanka, will demand that the government prioritize these issues.  More importantly, the progression of the U.S.-India strategic alliance under President Obama will be closely monitored by India’s neighbors over the next few years.

The U.S – India Relationship

The United States has been eagerly waiting to engage India more comprehensively on the AfPak Strategy it rolled out a few months ago.  A strong government in New Delhi will help, but signals thus far have been mixed, indicating a desire to maintain minimum strategic interaction with Pakistan and instead prioritize domestic reform.

Employing the AfPak strategy’s regional approach will not be easy for Ambassador Holbrooke.  New Delhi will not give in to the perception of animated progress but will instead expect a clinical process of deliverance from Pakistan.  Intelligence sharing between the two countries at the behest of the CIA is a good start.  However, Pakistan’s release of Hafiz Saeed, one of the prime suspects in the attacks on Mumbai last year, has drawn sharp criticism from New Delhi.  Such cases will only prove counterproductive to resuming the “composite dialogue,” especially as “Track II diplomacy” between the two countries is set revive.

Obama and Singh will need to create opportunities to take this relationship forward.  Rresolving discrepancies in their approach to issues such as the Doha round of the World Trade Organization (WTO) and India’s demand for a permanent seat on the United Nations Security Council will be vital.

Secretary of Defense Robert Gates recently described India as an “emerging power center,” “partner” and “provider of security” in the Indian Ocean. The United States has much to gain by establishing a stronger partnership with India, including hedging against China’s recent forays — and largely unclear agenda — in the Indian Ocean.

Nuclear Deal

Proponents of the U.S.-India nuclear deal will now breathe easy with Singh continuing in office; it was Singh’s office that saw the highly controversial deal through last summer.  The nuclear deal, hailed as the harbinger of change in the bilateral relationship, generated great attention in the Indian and global media.

Meera Shankar, India’s Ambassador to the United States, acknowledges that the reprocessing arrangements as well as liberalization of the export licensing procedures will need to be expedited.  She said last week at the U.S.-India Business Council that, “We would very much like to move forward in a concrete way with agreements for building nuclear reactors with U.S. assistance in India.”  The U.S.-India Civil Nuclear Energy Working Group has been entrusted to deepen mutual understanding and continue collaborative efforts on this front.  The benefits of this deal must be felt in order to further cement the bilateral relationship.

Climate Change

Obama has put the onus on India and China to make significant contributions toward developing a consistent policy to tackle climate change.  This is an area where the two countries could meld their interests to increase cooperation, but major differences remain.

The Waxman-Markey bill, which seeks to establish a cap and trade system for the United States, is currently pending in the U.S. House of Representatives.  India is loathe to put any restrictions on emissions and is comfortable benefiting from the arrangements made under the Kyoto Protocol.  However, demands to enforce binding emission caps on developing economies continue to simmer.  The notion that the newly sworn-in government in India will relent to some of these demands is false.

Although India has received little attention from President Obama’s extensive foreign policy overtures, it will now be time for him to identify broader areas of engagement and take concrete steps —  such will be the hope in New Delhi at least.  There are certainly many ideas to strengthen this relationship: encourage India’s permanent involvement in the trilateral U.S.-Japan-Australia dialogue; increase the frequency of meetings between the U.S.-Indian Counterterrorism Joint Working Group; move forward on military cooperation, including increasing arms sales to relinquish and dilute New Delhi’s dependence on Russia.

The long-term imperatives of the international system, including the balance of power in Asia, will witness a closer alignment between the U.S. and India — the pace of this movement, however, will be tied to the outcome of various regional and global factors rather than to a shared paradigm of values.

Habeeb Noor is an intern with the Atlantic Council’s South Asia Center.