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25 January 2017, Gateway House

How Trump will reconfigure geopolitics

Ambassador Neelam Deo delivered this speech at the grand finale of ‘The Mind Games’ – a platform for talent development & idea generation at Mahindra Partners on January 18, 2017. Ambassador Deo’s speech focuses on the disruption of the post-Cold War global framework to be caused by Trump’s foreign policy changes

Director, Gateway House

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Ambassador Neelam Deo delivered this speech titled “Trump’s America: reconfiguring global geopolitics” at the grand finale of ‘The Mind Games’ – a platform for talent development & idea generation at Mahindra Partners on January 18, 2017.

Thank you very much, it’s a real pleasure to be here.

I regard myself as part of the Mahindra family, just like all of you, and I see this as a great opportunity to talk about something which is literally the flavour of the day everywhere else as well.

I’m sure all of you have followed the election process. It’s sort of been what they used to say about the circus–the greatest show on earth. It’s a real television spectacle, it’s something that we look at and follow endlessly, just because things seem to happen, they don’t actually happen. It’s like our television debates where people say bad things to each other and then that itself is news; and then they argue about the bad things they said to each other the previous evening.

This is sort of how this campaign went, with the Democrats accusing the Republicans of various things, the Republicans then turned around and accused them of other things, and the end result was the biggest surprise of all, especially to mainstream media. No one had predicted–first, that Trump would win the Republican nomination, and then that he would win the Presidency.

In actual fact, of course, he didn’t win the Presidency. Hillary Clinton won three million more votes than Trump did. But the United States has a very peculiar system–they like to call it the direct system of election for the Presidency–but in fact, it’s not. It’s an indirect election. There is an electoral college and there are a certain number of votes that each state gets. Now, the rules for each state are different. In some states, all the electors are bound to vote according to who won in that state. In other states, they are unbound–they can vote, as we would like to say, according to their conscience. In others, the whole delegation does not vote together, it splits along the Democrat-Republican split in the vote itself.

So, Donald Trump won this election by winning the electoral college, but not the popular vote. Which is why the latest evolution in the arguments between the Democrats and the Republicans–alleging that Russian hacking of the Democratic National Committee and disinformation campaigns, may actually have affected the outcome of this election by tilting it away from Hillary Clinton–is invalid.

Now that would be a valid argument, if it were not the case that she actually won the popular vote. So, it’s a very divided political situation in the United States.

There has been an earlier case of this nature, which was when George Bush actually won his first election because the electoral college voted for him. But the electoral college in Florida should not have voted for him, because he hadn’t won the majority of the votes. The recount was stopped by the Supreme Court. And it’s all very complicated, but the Republicans then started to make fun of the Democrats, saying that which other party had managed to lose two presidential elections in 15 years. And that this says something about the inefficiency of the Democratic Party.

I’m telling you all this just to give you a flavour of how divided the American electorate is, how divided the American Congress is, how divided the policy establishment, and particularly the foreign policy establishment has been. And that is the way I want to try and show you how Trump’s America is actually going to reconfigure global politics because they are coming in with the express intention of changing everything that Obama did. And that includes the domestic agenda–things like the Affordable Healthcare Act, the decisions that have been made on environmental issues–not legislation, because, of course, Obama was able to get nothing through Congress–and therefore it’s very easy for a new administration to come and overturn those measures that were decreed.

But major changes are also likely in the foreign policy of the United States. This is so major a change that will be taking place once he becomes the president on Friday that, actually, the changes have already begun to happen. Companies and countries are already adjusting their positions to the statements and twitter messages that the President has been sending out. And you can see that in terms of how the automobile companies have reacted–Ford, Fiat Chrysler, and Carrier– with whom he started his campaign, are adjusting policies.

But the same thing is happening also to countries. Once Trump won the election, and because he had campaigned on saying he would reject the North American Free Trade Agreement (NAFTA), which is the agreement between Mexico, the United States and Canada, Canada immediately said that they were ready to renegotiate that agreement. It’s much more difficult for Mexico, which is not such a strong economy, which is a poorer country, and in which many countries and many companies have invested, in order to have easier access to the American market.

This, as it happens, includes the Indian IT industry, which has invested in Mexico, and Indian auto part makers–including Mahindras, as it happens–have all set up manufacturing facilities in Mexico. So if he actually does raise tariffs of 35% and 45%, this is going to be a result which will ripple across industries, and it will ripple across into other countries as well.

So what I’d like to do is to begin by telling you the sharp differences between the Obama foreign policy and the Trump foreign policy, which we are discovering. Some statements have already been made during the campaign, but some will evolve as we go along.

The first big difference is that President Obama was a very strong believer and supporter of security alliances, for instance, NATO. Now Obama in all his exchanges and public addresses always said that NATO was very important to the United States. He did say that members of the NATO alliance, the Europeans, should pay more, have higher defence budgets (because they are all supposed to have a defence budget of 2%). But the reality is that the Americans contribute more than 80% to the NATO budget. They are a bigger economy, and they have a much higher percentage of that economy allocated towards defence.

Obama was also at pains to assure allies in East Asia–Japan, South Korea and a little bit less in a security alliance, but also the Phillippines–that the United States would support them against a burgeoning China, which was also becoming aggressive. And in island disputes in the East China Sea with Japan and in the South China Sea with the Phillippines, which were becoming the focus of conflict and contention.

With India, the Obama administration signed a joint strategic vision statement during Obama’s second visit to India for the Republic Day, where he was our Chief Guest.

Now this vision statement actually focused on what is called the Indo-Pacific, but really to the East of India, on the South China Sea disputes and the Pacific side. From India’s point of view actually, it was not the best agreement. We would have liked more focus on the Arabian Sea. Our disputes are with Pakistan, or we are concerned about the turbulence in the Middle East, in the Arab countries, their differences with Iran, the war in Syria–all those factors. But actually, this joint vision statement had a focus, had a bias, at least, towards East Asia. This is the Obama security alliances situation.

Now, Trump is coming in, and what he has had to say about NATO has actually disturbed its European members a great deal. First of all, he said that he would like to have very good relations with Russia and he is full of praise for President Putin. The Europeans, on the other hand, are, at this moment, in very bad relations with the Russians because of their differences over the Ukraine and the annexation of the Crimea by Russia. They have imposed sanctions, the Americans have imposed sanctions, they have taken the issue to the UN Security Council, but naturally, it hasn’t gone anywhere because Russia will have exercised its veto on this question.

In the case of the East Asia security alliances, nothing can be done in the Security Council because, of course, China will veto it. But also, Trump has come in, saying that unless the Japanese and the South Koreans also pay more money, there’s no reason for the United States to provide them with a security umbrella.

In response to a journalist’s question, he also said let them have their own nuclear weapons programmes, he is quite indifferent to that. This is a huge difference with what has been a kind of religion in American foreign policy with regard to nuclear issues.

At the same time, we know that Trump is mostly favourably inclined towards relations with India. But there are no guarantees here, because he also had a telephone conversation with Prime Minister Nawaz Sharif of Pakistan and said it’s a fantastic country, you’re a fantastic leader, and you’re doing fantastic things. And ‘fantastic’–in that short paragraph–was used 10 times. And that just talking to him he feels like he’s already in a place that feels like home and I’ll do whatever it is that you want me to do, etc.

So it sounds like a ham performance, but you have to take it seriously, because this is the president-elect of the United States. So we’re not sure how that will go.

But they are completely divided. And the whole security situation will change globally. Even though Obama has, in subsequent press conferences, said I love NATO, I love all the members of NATO etc, European NATO member countries have already started to revive ideas about a European Union security doctrine; a European Union Security Force. They’ve all started to talk about how they must come closer together, that European unity is important.

Now the whole thing has been aggravated for Europe, of course, by Brexit, by the UK moving out of the European Union. The UK is, of course, the second largest contributor to NATO as well. And more importantly, it has one of the few air forces and an actual army which does some fighting. Take, instead, some of the other members of the NATO alliance, where the countries are small, so also the size of their armies… they always say Estonia has a budget of 2%. But Estonia has an army of 2,000 people only. So Estonia contributed to the NATO forces in Afghanistan by sending 50 people. But what else can it send?

So this has complicated the whole NATO situation and there has been a revival in discussions about a European force.

Abe was the first foreign leader to come and meet Trump, and he hopes to have received some assurances from him that they will not back off from the security assurances that are provided by the treaty. And he made it clear to Trump that actually Japan pays more than 60% of the cost of stationing American troops in American bases in Japan.

South Korea has been so concerned that it has agreed to the stationing of a missile defence force, which, naturally, has aggravated relations with China. So this is all so you understand that you can’t take one decision and think of it as a bilateral one. Every decision has many ramifications and many ripple effects with other countries.

And of course, the North Koreans immediately announced that they were doing many more missile tests, they said they had nuclear weapons. And now they have started testing missiles successfully, which can reach Guam, one of the islands in the South Pacific, which is an American base. So there are many consequences here.

And the same sort of ripple effects can be seen in the differences in the attitudes towards trade agreements. Now for Obama, the Trans-Pacific Partnership (TPP), which was a trade agreement with Japan and included many other East Asian and South American countries, and Australia and New Zealand, but excluded China—he saw that as the centre piece of his pivot to Asia policies.

But Trump has made it clear–he says he’s going to do all these things on his first day in office, so he’s going to have a really busy Saturday—that he’s going to take the U.S. out of the TPP. That is a real problem for Japan because Abe used up a lot of political capital to get Japan to agree to the terms of the TPP.

It’s also a big problem for other countries, like Vietnam, which had hoped that being inside the TPP would offer it security against China in their dispute over the Spratly islands. He’s, of course, already said he’s going to junk NAFTA, which has implications for Mexico, for Canada.

It is most unlikely that he will pursue a Trans-Pacific treaty with the European Union, because he supported Brexit. In fact, he said that he was himself the biggest Brexiter of all and was not going to enter into an agreement with the European Union, because he’s already told the UK that he will enter very quickly into an agreement with it. Which, in actual fact, he can’t, because until UK exits the European Union, it is not in a position to start. It can start talking about trade, but it cannot enter into trade agreements with other countries.

Which is why when Theresa May came to India, she did not get much joy out of it because neither can she start a trade agreement with India and nor was she forthcoming on the whole issue around Indian temporary workers in the UK.

So all the trade agreements which were outside the World Trade Organization, the WTO framework, are going to be renegotiated, deferred, put away, as the case may be. But Trump has also said, occasionally, that he will pull the United States out of the WTO as well. He wants to renegotiate everything, he wants to negotiate it like a contract. He says he’s going to get terms which are much more favourable to the United States.

The third area which is going to change completely is global governance, the institutions of global governance. The United Nations, which everybody supports, he has just called the United Nations a talk shop where people get together to have fun, he said. He is of course, dismissive of the European Union: in his latest press conference, he said the European Union will disintegrate, because countries want their own identities.

This is very bad timing for leaders in the European Union because France, Italy and Germany are up for elections this year, and certainly in all three countries, nationalist parties have become stronger and stronger. They first received a boost with Brexit, and now a boost, with the positions that Trump takes.

Trump’s position on the nuclear proliferation treaty is similar. He thinks everybody can have their own nuclear weapons programmes if they wish, whereas Obama, and Clinton, before him, were really religious about it. You know, at that time when we used to talk to the Americans, we use to call them the ayatollahs of nuclear non-proliferation. It was that powerful a matter in their thinking.

It is unlikely that every country will have its own nuclear weapons programme, and it really would make the world more unsafe. As it is, one of the reasons that India eventually did a test and declared itself a nuclear weapons power was because of China, and because we knew that Pakistan also was an undeclared nuclear weapons state. And as Prime Minister Manmohan Singh said at the time, we really don’t want yet another nuclear weapons state. At that time he was talking about Iran.

But countries like Saudi Arabia, Egypt, Turkey, many countries have the science and the technology, and could, with some effort, also turn into nuclear weapons powers if they chose to: take a small country, like North Korea, which has been sanctioned for the last 65 years. It can actually have a fairly successful nuclear programme and missile programme. So that will change everything and that change will come out of the fact that Trump says he’s going to renegotiate or absolutely pull out of the deal that was done with Iran over its nuclear weapons programme.

Now, this, of course, is not a bilateral deal between the United States and Iran. It was a deal done by the five permanent members of the UN Security Council, plus Germany, plus the European Union. So it is not something that Trump can actually renegotiate all on his own. And Iran has fulfilled all the requirements, the International Atomic Energy Agency has certified that repeatedly. It would also, of course, make relations with Russia and China even worse because both those countries supported this deal with Iran.

Similarly, and quite importantly, there is Trump’s position on the Paris Climate Change agreement. He doesn’t believe that climate change is a consequence of human activity, and therefore, there is no need to do anything about it. In fact, he has said that he is going to do away with all the laws and changes that Obama had brought in, including those relating to automobile emissions, the Keystone 11 pipeline from Canada, the various laws that California enacted for itself.

And this has become so contentious that California has actually declared that it will do its own thing, that it will follow its own rules. And it can. Because the United States is a federal system, and state governments have large powers in many areas. So like India, there are many things that states in India can do, regardless of what the central government wants, which is why the whole GST negotiation has been so contentious. So the multilateral governing institutions that Obama supported are now all going to change.

Trump has not said anything about the financial institutions, the World Bank and the IMF. That remains to be seen, we don’t know what his position on them may be. But these are again institutions that Obama had supported very strongly.

There is a very interesting shift underway with Trump reaching out to Putin in Russia and saying that he would like to have good relations with Russia because he thinks that they can fight terrorism together–specially the ISIS or Daesh in Syria. And that is one of his complaints about NATO: that NATO is obsolete, it was set up to fight communism, but it has not been able to take on terrorism.

But if, actually, the Russia-U.S. relationship improves, it will be a kind of reverse of what Nixon and Kissinger had achieved in the ’70s by separating Russia and China when they were caught up in the Vietnam War. And by separating China from Russia, actually America was able to negotiate what they called an honourable departure, or an honourable peace.

So from the Indian point of view as well, it would be a positive if the United States and Russia had better relations. But if the United States moves much closer to Russia, then what the Europeans are saying–they are already feeling abandoned because of his statements on the European Union, on NATO–is that he will be sacrificing Europe in order to move towards a rebalance with China, which may be in Asia’s interest, and certainly it would be in the Indian interest.

For India, it’s also in our interest that relations between the United States and Russia not be so hostile because Russia remains our largest arms supplier, and the oil industry in India has invested a great deal in Russian oil fields. So that would be an important change for us.

Finally, to mention just a few other points before we will be happy to go into questions. Trump has said that he will shift the American embassy from Tel Aviv to Jerusalem. That would be a big change and really disruptive in the whole international position on the Israel-Palestinian dispute. Obama, on the other hand, was certainly trying to be more fair and more neutral in this dispute.

And the last thing that happened which has caused Trump a great deal of unhappiness was the vote in the UN Security Council, where, for the first time since the Second World War, the United States abstained on a resolution which condemned settlements in occupied territories in Palestine. This would be a big shift again in the global configuration.

By insisting that he’s going to either reject completely or renegotiate the nuclear agreement with Iran, what Trump will be doing will be to move away from the Gulf’s Sunni powers that Obama, and before him, all American administrations have supported into at least allowing the Shi’a countries, like Iraq–and there are, of course, other countries in which there is a Shi’a majority, like Bahrain. All of the Gulf countries have Shi’a minorities.

Already, that power shift has changed and it will be very difficult to stop it now that sanctions against Iran have been lifted. Iran is the most developed country in this region. It is the most highly educated, it has the biggest population and it has, in many ways, the most sophisticated industrial structure despite all the sanctions that were placed against it.

One other change which we need to consider–whether it is a change or not we don’t know, but we will discover it–and that is in terms of the Asia pivot. If, in fact, U.S. relations with China worsen, then he could actually do an Asia pivot, which is to move 60% of the American Navy to Asia, rather from where they are concentrated in Europe and the Middle East, strengthen troop deployments– there are 2,000 troops that are deployed at a base in Australia, Darwin–but they would have to strengthen those.

And Trump would have to strengthen relations with Japan, with South Korea, with Vietnam, with Singapore, with India. And that would also have implications for India, including some negative ones. The Chinese are already really wary of the closeness which has come in Indo-U.S. relations, and they would take it in a very hostile way.

I’m going to stop here and take questions.

Neelam Deo is Co-founder and Director, Gateway House: Indian Council on Global Relations; She has been the Indian Ambassador to Denmark and Ivory Coast; and former Consul General in New York.

Ambassador Neelam Deo delivered this speech at the grand finale of ‘The Mind Games’ – a platform for talent development & idea generation at Mahindra Partners on January 18, 2017.

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