Analysis| PM Narendra Modi in the US: What are the stakes?

Updated on Sep 17, 2019 08:58 PM IST

He will seek new economic alliances and reassure stakeholders that the slowdown in India is temporary

The significance of PM Narendra Modi’s Houston visit has been heightened by the fact the White House has announced that US President Donald Trump will participate in a major diaspora event to be held there(PM Office release)
The significance of PM Narendra Modi’s Houston visit has been heightened by the fact the White House has announced that US President Donald Trump will participate in a major diaspora event to be held there(PM Office release)
ByFrank F Islam

Later this month, Prime Minister Narendra Modi will visit the United States (US) to address the United Nations General Assembly in New York. During the trip, Modi will also visit Houston to engage the Indian diaspora and boost India’s economic ties with the US.

The significance of the Houston visit has been heightened by the fact the White House has announced that US President Donald Trump will participate in a major diaspora event to be held there. The White House press release states the President will be joining Modi because, “It will be a great opportunity to emphasise the strong ties between the people of the United States and India... and to discuss ways to deepen their energy and trade relationship.”

President Trump might also be coming to Houston because he likes to be in front of large audiences and in this US presidential campaign season there may be some Trump supporters and prospective donors at this event. The nature of the Texas economy and the size of the Indian diaspora in the state give it great potential for Modi and India.

With a GDP of $1.8 trillion, the state of Texas is America’s second largest economy with an economy bigger than those of Canada and Russia. India is currently Houston’s fourth-largest trading partner. Last year, the bilateral trade exceeded $7 billion, nearly a tenth of India-US bilateral trade.

While this is a large amount, there is a significant opportunity to increase trade with Texas substantially — especially in the energy sector. As India progresses toward becoming a $5 trillion economy over the next few years, its energy needs will increase dramatically. The Middle East and Russia will not be able to satisfy those needs. Texas has the resources to help do so.

The Lone Star state is a leader in crude oil production and its refineries process more than a fourth of all the US oil refining.

It’s not just the natural and business resources of Texas that make the Houston visit appealing, it is the human resources as well. Texas is home to a quarter million Indian-Americans, having the fourth-largest Indian-American population in the US after California, New York and New Jersey.

The Modi government is well aware of this and that is why on September 22, Prime Minister Modi will address a Texas-sized audience of 50,000 Indian Americans in the NRG Stadium in Houston at a gathering named “Howdy, Modi!” — notice the Texan twang. This will be by far the largest crowd Modi has addressed in the United States.

On his first visit to the US in 2014, he spoke to nearly 18,000 Indian Americans at Madison Square Garden in New York City, two years later he addressed a crowd of a similar size in San Jose in the Silicon Valley of California. Having covered the two U.S. coasts in 2014 and 2016, selecting Houston as the venue for this visit is a solid strategic choice for these pivotal times.

Unlike their compatriots on the two coasts and in the Midwest, who tend to be more liberal, Indian Americans in the South tend to be more conservative in their political ideology and thus more aligned with Modi’s politics.

Given this, one can expect Modi to make a big investment pitch to those in the stadium, especially given India’s recent economic downturn. Over the past several months, as economic growth has slowed down, a number of foreign institutional investors have either pulled their money out of India or stopped additional investment. The Indian diaspora in this country could step up and help fill this gap by committing financial support to India.

Modi, in return, might announce a direct flight connecting Houston and India. The South is the only region in the United States that does not have direct flights to India.

On the whole, the event billed “Howdy, Modi! Shared Dreams, Bright Futures” will feature a series of entertainment and cultural programs, reflecting bilateral cultural ties and Indian American heritage, can be expected to play out as an Indian-American love-fest. And, the Prime Minister will undoubtedly, as he does on all these occasions, perform exceptionally well and generate great enthusiasm from those in attendance

After Houston, Modi will travel to New York where he will not be the main act but one of many speakers at the annual Bloomberg Global Business Forum. Other notable speakers at this year’s Forum include global business and government leaders such as former Presidents Bill Clinton and George W Bush and Christine LaGarde, former managing director of the International Monetary Fund and incoming president of the European Central Bank.

PM Modi will certainly be well received and his remarks will be listened closely as corporate leaders and investors from the US and around the world take the measure of India’s current economic conditions and plans for the future. No decisions will be made at this event but it does provide the opportunity to assuage any concerns or misgivings that those in the business community might have regarding India’s current state.

The Kashmir situation will get some media attention during Modi’s trip and attract some protesters but it is unlikely to dominate the coverage either in the US or India or to be a centerpiece for Modi’s conversations. As a result, what is at stake on Modi’s September visit to the United States is increasing the financial support from those in the Indian American diaspora for India; forging some new economic alliances; and reassuring corporate and government leaders that the economic setbacks have been only temporary and that India will soon return to a fast growth path.

Those are not all or nothing stakes but achieving them will provide Modi with a solid framework to build upon during his second term and to advance his agenda and I believe that is why he is making this visit at this time. Time will tell whether his mission will be accomplished.

Frank F Islam is an entrepreneur and thought leader and Civic Leader based in Washington, DC

The views expressed are personal

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