Climate is right for Indo-US green pact to come through

NEW DELHI: Climate change will figure prominently in talks between Prime Minister Narendra Modi and President Barack Obama on Sunday, as they discuss India’s mandatory domestic manufacturing component for clean energy even as a deal similar to the high-profile US-China agreement is unlikely, officials said.

The domestic manufacturing clause is a contentious issue, according to a US official, who said the two sides are likely to work out a compromise arrangement at best. The US has filed a complaint at the World Trade Organisation on India’s mandatory domestic production component for solar panels. The Modi government, on the other hand, is keen to boost local manufacturing under its ‘Make in India’ programme. “The Indian government is aware of our views. However, how this issue is discussed between the two leaders remains to be seen,” said the official, who did not wish to be named.

Manish Bapna, MD of WRI, a Washington-based think tank, said, “The trade question is an important one for the US. There could be a relaxation in the domestic manufacturing policy for the US in return for much more substantial investment and technology.”

Pointing to the advantages of a resolution on this issue of domestic manufacturing component, Raymond Vickering, who served as assistant secretary of commerce for trade development in the Clinton administration, said “There is a WTO complaint on this. A resolution will mean withdrawing the complaint and that will add to the goodwill.”

A senior US official said it is unlikely that there will be a climate agreement similar to the US-China one in November 2014. “Agreements with different countries should not be copies. Every country has its own circumstances.”

An Indian official acknowledged, “Negotiations for the November climate agreement went on for almost two years. There is nothing like that between India and the US.” However, the official added that climate change is important for both Obama and Modi.

The Modi-Obama deal will also give India another opportunity to stress its commitment to tackle climate change. “India has been judged less by what it does and more by what it says,” said Navroz Dubash, senior fellow at the Delhibased Centre for Policy Research.