US-India Global Review

class in India, whole economies are changing to account for this global shift in market share. Asia’s share of global GDP is expected to surpass 50 per- cent by the middle of this century. We need to collaborate with India to ensure that the Indo-Pacific is increasingly a place of peace, stability, and growing prosperity – so that it does not become a region of disorder, conflict, and predatory economics. The world’s center of grav- ity is shifting to the heart of the Indo-Pacific. The U.S. and India – with our shared goals of peace, security, freedom of navigation, and a free and open architecture – must serve as the eastern and western beacons of the Indo-Pacific. As the port and starboard lights between which the region can reach its greatest and best poten- tial. First, we must grow with an eye to greater prosperity for our peoples and those throughout the Indian and Pacific Oceans. By the year 2050, India may boast the second largest economy in the world. India’s population – with a median age of 25 – is expected to surpass that of China’s within the next decade. Getting our eco- nomic partnership right is critical. Economic growth flows from innovative ideas. Fortunately, there are no two countries that encourage innovation better than the United States and India. The exchange of technologies and ideas between Bangalore and Silicon Valley is changing the world. Prosperity in the 21st cen- tury and beyond will depend on nimble problem solving that harnesses the power of markets and emerging inno- vations in the Indo-Pacific. This is where the United States and India have a tremendous competitive advantage. Our open societies gener- ate high-quality ideas at the speed of free thought. Helping regional partners establish similar systems will deliver solutions to 21st cen- tury problems. For that to happen, greater regional connectivity is essential. From Silk Routes to Grand Trunk Roads, South Asia was for millennia a region bound together by the exchange of goods, people, and ideas. But today it is one of the least economically integrat- ed regions in the world; intra-regional trade has lan- guished – sitting at around 4 or 5 percent of total trade. Compare that with ASEAN, where intra-regional trade stands at 25% of total trade. The World Bank estimates that with barriers removed and streamlined customs procedures, intra-regional trade in South Asia would nearly quadruple from the current $28 billion to over $100 billion. One of the goals of greater connectivity is pro- viding nations in the Indo- Pacific the right options when it comes to sustain- able development. The Millennium Challenge Corporation is one model of how we can achieve it. The program is committed to data, accountability, and evi- dence-based decision-mak- ing to foster the right circum- stances for private invest- ment. Last month, the United States and Nepal signed a $500 million compact agree- ment – the first with a South Asian nation – to invest in infrastructure to meet grow- ing electricity and trans- portation needs in Nepal, and to promote more trade linkages with partners in the region, like India. The United States and India must look for more opportunities to grow this connectivity and our own economic links, even as we look for more ways to facili- tate greater development and growth for others in the region. But for prosperity to take hold in the Indo-Pacific, security and stability are required. We must evolve as partners in this realm too. For India, this evolution will entail fully embracing its 12 US-INDIA GLOBAL REVIEW JANUARY-MARCH 2018