The US and India are natural allies that can show the rest of the world that democracies can deliver for their citizens, despite volatility and war, US Treasury Secretary Janet Yellen said on Friday.
Yellen, in a speech highlighting the Biden administration’s desire to deepen economic ties with India, said that both the global economy and the democratic idea were at inflection points.
Her remarks at a Microsoft research facility on the outskirts of New Delhi came as control of the US Congress was still undecided after mid-term elections on Tuesday.
“The US and India are ‘natural allies,’ in the words of a former Indian prime minister,” Yellen said, adding that “both countries waged similar fights for independence to attain freedom and dignity.”
“People around the world are looking to us and asking: can democracies meet the economic needs of their citizens? Can they stand up to bullies and co-operate on the most intractable global problems?” she said.
As the two largest democracies, India and the US could answer the sceptics by taking actions over the next year and beyond that could “demonstrate the capacity of our democracies to deliver for our people.
I am confident that we will succeed.”
Among these actions are goals for India’s leadership of the Group of 20 major economies next year, which should focus on the countries’ shared priorities for boosting investments to fight climate change, breaking a logjam in restructuring debts for poorer countries and improving access to the digital economy.
“India’s G20 year is a chance to accelerate global co-ordination on debt restructuring,” Yellen said. She also said that ending the war in Ukraine was a “moral imperative” but that economic challenges from the conflict and from supply chain strains were drawing India and the US closer together.
India’s membership in the Indo-Pacific Economic Framework (IPEF) will make supply chains resilient between the country and the US and help the entire region, Yellen added.
She said strong trade and investment, and people-to- people ties make the bilateral economic and financial relationship a critical element to the partnership between the two countries.
“India’s membership in Indo-Pacific Economic Framework, in efforts to make our supply chains more resilient, through what I call friend-shoring, are tightening those ties,” Yellen stressed.
While India is part of the Biden administration’s signature Asian engagement project IPEF, it has opted against joining the IPEF trade pillar negotiations.
At a joint news conference with Yellen, Indian Finance Minister Nirmala Sitharaman said her meeting with Yellen will help facilitate a co-ordinated policy stance on global economic challenges facing the world.