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U.S., India Pledge Closer Economic Ties

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NEW DELHI—Top U.S. and Indian officials pledged to deepen their economic relationship during a series of meetings on Friday, as the two countries seek to overcome differences over Russia and work together to counter China’s manufacturing dominance.

Mutual concern about China has drawn the U.S. and India closer in recent years, particularly on military and national security issues. Treasury Secretary

Janet Yellen

and Indian Finance Minister

Nirmala Sitharaman

worked during an annual forum to extend that collaboration to the economic sphere, even as both countries largely abstain from opening up formal trade barriers.

Throughout the meetings on Friday, Ms. Yellen repeatedly emphasized her concept of “friendshoring,” a term used to describe an effort to reorient supply chains away from geopolitical adversaries such as China. She has said that the U.S. needs to avoid relying too heavily on a small concentration of suppliers, a dynamic that helped to create bottlenecks during the Covid-19 pandemic and to push up prices.

India, Ms. Yellen said, was one viable alternative to China, along with Vietnam and other countries.

“I think India has a lot of potential as a place where one can expand manufacturing,” she said.

Ms. Sitharaman, meanwhile, said during a public discussion with Ms. Yellen that investors in the U.S. should make more commitments in India.

Janet Yellen speaks with Microsoft India President Anant Maheshwari during her visit to India on Friday.



Photo:

Prakash Singh/Bloomberg News

“We are continuously engaged with the U.S. administration and most of our business leaders also do business in the U.S.,” she said.

Russia’s invasion of Ukraine has put fresh pressure on the U.S.-India relationship this year. India has deep historical and military ties to Russia and has stayed largely neutral during the conflict, while increasing its purchases of Russian oil. Along with providing weapons to Ukraine, the U.S. has led a coalition of its allies to place a series of wide-ranging sanctions on Russia for the invasion.

In a speech at a

Microsoft

facility in New Delhi, Ms. Yellen said that ending Russia’s war in Ukraine was a “a moral imperative.” Indian Prime Minister

Narendra Modi

told Russian President

Vladimir Putin

that “today’s era is not one for war” in September.

Ms. Yellen also said that ending the war is “the single best thing we can do to help the global economy.” The war has weighed on global food and energy prices all year, exacerbating the worst inflation in decades. Indian officials have raised concerns about the economic consequences of the invasion.

Still, Ms. Yellen didn’t call on India to change its relationship with Russia. After having raised concerns to their Indian counterparts about Russia in the spring, Biden administration officials have largely backed off calling out India’s ties to Russia.

“The strength of Indo-U.S. relationship lies in mutual understanding of each one’s necessities and respecting differences,” Ms. Sitharaman said on Friday.

Write to Andrew Duehren at [email protected]

Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8


NEW DELHI—Top U.S. and Indian officials pledged to deepen their economic relationship during a series of meetings on Friday, as the two countries seek to overcome differences over Russia and work together to counter China’s manufacturing dominance.

Mutual concern about China has drawn the U.S. and India closer in recent years, particularly on military and national security issues. Treasury Secretary

Janet Yellen

and Indian Finance Minister

Nirmala Sitharaman

worked during an annual forum to extend that collaboration to the economic sphere, even as both countries largely abstain from opening up formal trade barriers.

Throughout the meetings on Friday, Ms. Yellen repeatedly emphasized her concept of “friendshoring,” a term used to describe an effort to reorient supply chains away from geopolitical adversaries such as China. She has said that the U.S. needs to avoid relying too heavily on a small concentration of suppliers, a dynamic that helped to create bottlenecks during the Covid-19 pandemic and to push up prices.

India, Ms. Yellen said, was one viable alternative to China, along with Vietnam and other countries.

“I think India has a lot of potential as a place where one can expand manufacturing,” she said.

Ms. Sitharaman, meanwhile, said during a public discussion with Ms. Yellen that investors in the U.S. should make more commitments in India.

Janet Yellen speaks with Microsoft India President Anant Maheshwari during her visit to India on Friday.



Photo:

Prakash Singh/Bloomberg News

“We are continuously engaged with the U.S. administration and most of our business leaders also do business in the U.S.,” she said.

Russia’s invasion of Ukraine has put fresh pressure on the U.S.-India relationship this year. India has deep historical and military ties to Russia and has stayed largely neutral during the conflict, while increasing its purchases of Russian oil. Along with providing weapons to Ukraine, the U.S. has led a coalition of its allies to place a series of wide-ranging sanctions on Russia for the invasion.

In a speech at a

Microsoft

facility in New Delhi, Ms. Yellen said that ending Russia’s war in Ukraine was a “a moral imperative.” Indian Prime Minister

Narendra Modi

told Russian President

Vladimir Putin

that “today’s era is not one for war” in September.

Ms. Yellen also said that ending the war is “the single best thing we can do to help the global economy.” The war has weighed on global food and energy prices all year, exacerbating the worst inflation in decades. Indian officials have raised concerns about the economic consequences of the invasion.

Still, Ms. Yellen didn’t call on India to change its relationship with Russia. After having raised concerns to their Indian counterparts about Russia in the spring, Biden administration officials have largely backed off calling out India’s ties to Russia.

“The strength of Indo-U.S. relationship lies in mutual understanding of each one’s necessities and respecting differences,” Ms. Sitharaman said on Friday.

Write to Andrew Duehren at [email protected]

Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

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