A joint leap forward?

The Indo-US technology partnership has emerged as a vital pillar in the geopolitical and economic landscape, signifying the convergence of two major democracies. With critical advancements in areas like semiconductor manufacturing, AI, and defence technologies, this collaboration not only benefits both nations but also alters global power dynamics.

✼ US-India technology partnership

The relationship between the US and India in technology has evolved from simple business exchanges to a comprehensive strategic partnership that aligns both nations’ long-term economic and security interests. In the last decade, India’s growing technology sector, backed by a talented workforce and the world’s largest digital ecosystem, has attracted significant interest from the US.

This partnership is underscored by Prime Minister Modi and President Biden’s recent collaboration, which has paved the way for significant developments such as the semiconductor fab plant in Kolkata. This isn’t merely a business initiative; it represents a milestone in reducing global reliance on other semiconductor-producing nations like China and Taiwan.

✼ Semiconductor industry as a strategic pillar

Semiconductors, often referred to as the backbone of modern electronics, are essential in nearly every technological device, from smartphones to advanced defence systems. However, the ongoing global chip shortage has exposed vulnerabilities in the supply chain, pushing countries to seek self-reliance.

India, with its vast pool of engineers and low manufacturing costs, is well-positioned to become a major player in global semiconductor production.

By building a robust semiconductor ecosystem, the partnership not only bolsters India’s domestic capacity but also strengthens global supply chains.

✼ AI, cloud, and emerging technologies

Artificial Intelligence (AI), cloud computing, and cybersecurity are at the forefront of the global technological race, and Indo-US collaboration in these areas is pivotal. With India’s burgeoning digital economy and the US’ expertise in AI research and innovation, the partnership is primed to create groundbreaking solutions that address global challenges.

For example, US tech giants like Google, Microsoft, and Amazon have made significant investments in India, leveraging the country’s large talent pool to develop AI-based solutions for healthcare, education, and agriculture. Microsoft’s AI for All initiative, launched in India, focuses on democratising AI, making it accessible to every industry, while Google has invested in AI research labs in India, positioning the country as a leader in AI development.

Cloud computing is another area where both nations are closely collaborating. India’s growing digital infrastructure requires scalable, secure cloud solutions. American firms like Amazon Web Services (AWS) and Microsoft Azure have expanded their operations in India, facilitating the growth of India’s tech sector and enabling startups to scale their operations globally.

✼ Defence and security cooperation

One of the most significant aspects of the Indo-US partnership is in defence technology and cybersecurity. The two nations are actively engaged in co-developing advanced defence systems, with technology transfer playing a key role. India’s defence modernisation efforts align with the US’s interest in a stronger regional ally to counterbalance rising threats in the Indo-Pacific region.

The collaboration extends to areas such as drone technology, artificial intelligence in warfare, and cybersecurity frameworks aimed at protecting critical infrastructure. The US has facilitated access to its cutting-edge technologies under the Defence Technology and Trade Initiative (DTTI), enhancing India’s defence capabilities.

A notable example is the Tata-Boeing partnership, which focuses on manufacturing defence equipment in India, including helicopters and fighter jets.

Cybersecurity is another critical area where both countries are collaborating. With the rise of cyber threats and increasing digital dependence, Indo-US cooperation on cybersecurity frameworks is essential for protecting digital assets and critical infrastructure.

✼ Economic impacts

The economic benefits of the US-India technology partnership are extensive, driving growth in both nations. For India, the inflow of US investments in technology startups, innovation hubs, and manufacturing plants has spurred job creation and bolstered its position as a global technology hub.

Startups in India, particularly in sectors like fintech, e-commerce, and health tech, have greatly benefited from this partnership. The US has become a major investor in Indian startups, with venture capitalists recognising the country’s innovation potential. Companies like Flipkart, Paytm, and Ola, which are key players in India’s tech ecosystem, have drawn significant US funding.

For the US, the partnership offers access to India’s vast market and talent pool. American firms, facing shortages in skilled workers domestically, are increasingly looking to India’s highly educated workforce to fill gaps in areas like AI, data science, and software development.

✼ Geopolitical ramifications

At the heart of the Indo-US technology partnership is a shared geopolitical interest in countering China’s growing influence in the tech space. China’s dominance in areas like semiconductor manufacturing, AI research, and 5G technology poses a strategic challenge to both nations.

In the realm of 5G, both countries are actively working to develop alternatives to China’s Huawei, which has faced scrutiny over security concerns. The US has led efforts to exclude Huawei from global 5G networks, and India has followed suit by banning the company from participating in its 5G rollout. This cooperation in telecom technology is aimed at building secure, resilient networks that safeguard national security.

✼ Challenges in the partnership

While the Indo-US technology partnership is flourishing, there are challenges that both nations must address. Regulatory hurdles, particularly in sectors like data privacy, intellectual property protection, and digital taxation, pose significant obstacles to deeper cooperation.

India’s infrastructure, though improving, still lags behind other nations in terms of connectivity and technological readiness. To fully benefit from this partnership, India needs to continue investing in its infrastructure, particularly in rural areas where access to digital technology remains limited.

Moreover, both nations must navigate the delicate balance between competition and cooperation. As India strengthens its domestic industries, there is potential for friction with US firms that have long dominated sectors like software and cloud computing. It will be crucial for both countries to find common ground on issues like market access, intellectual property rights, and competition policy.

✼ Successful Indo-US technological collaborations

The Tata-Boeing partnership is a prime example of successful Indo-US collaboration in defence technology. Through this joint venture, India has enhanced its defence manufacturing capabilities while benefiting from technology transfer from Boeing. The partnership has also created jobs and contributed to India’s goal of becoming a major player in global defence production.

In the technology sector, the collaboration between Google and the Indian government to develop AI-based solutions for healthcare is another success story. Google’s AI research lab in India has worked on projects that use machine learning to improve healthcare outcomes, particularly in rural areas.

✼ Brewing of a new era of technological dominance?

The Indo-US technology partnership is poised to reshape the global technology landscape, positioning both nations as leaders in innovation and digital transformation. By leveraging each other’s strengths, the US and India are building a technological ecosystem that is not only resilient but also competitive on the global stage.

As the partnership continues to deepen, it has the potential to usher in a new era of technological dominance, where both nations play a pivotal role in shaping the future of innovation. While challenges remain, the long-term benefits of this collaboration far outweigh the risks, making it a cornerstone of global tech leadership in the years to come.

The writer is Management Consultant & IT Strategist. Views expressed are personal