US Still Considering India Sanctions, Continuing to Push for Trade Deal, State Dept. Official Says

The Trump administration is still considering sanctioning India over purchases of Russian missile defense systems, a top State Department official said. Alice Wells, principal deputy assistant secretary of state for South and Central Asia, said there remains widespread support both within the administration and in Congress for sanctioning buyers of Russian military goods, adding that India needs to choose either U.S. or Russian military equipment, but cannot have both.

“It's not a mix and match arrangement,” Wells said during a May 20 webinar hosted by the Atlantic Council. “At a certain point, India will have to make a strategic commitment to technologies and platforms, and we think we have the best technologies and platforms.” If India commits to Russian military items, it may be subject to sanctions under the Countering America’s Adversaries Through Sanctions Act, Wells said. “CAATSA very much remains a policy priority, certainly for Congress, where you've seen the very strong demand for implementation,” she said. “[It] has not moved off the table.”

India’s 2018 purchase of Russian S-400 anti-aircraft missiles systems was thought to lead to U.S. sanctions (see 1911260066), similar to sanctions proposed against Turkey for purchases of Russian military goods (see 1912270034). Wells said the administration is focused on limiting Russia’s ability to raise funds from foreign military sales, and said India should want to buy from a more reliable partner. “What I hear so much in India is the concern over corruption, the appearance of corruption,” Wells said. “There's nothing better than a [U.S. Foreign Military Sale] process, which guarantees transparency. The deal is done without controversy.”

Wells also stressed that the U.S. wants to complete a trade deal with India, saying she was “disappointed” the two countries could not come to an agreement earlier this year (see 2002200054). “We really want to work with India,” Wells said, calling it a “priority” for the administration. “I know my colleagues at the [Office of the U.S. Trade Representative] continue to work toward that goal with their Indian counterparts.”

She also said the post-COVID-19 trade landscape represents a “golden opportunity” for India as countries seek to diversify their supply chains. “We certainly hope that the lessons learned from the pandemic is that there's a real opportunity for greater diversification as countries are looking to de-risk from China,” Wells said. “India could make sense if the right policies are put in place and with the right commitments to infrastructure. We certainly want to see that happen.”