These factors may be driving a series of conciliatory moves by both countries. India, after prodding from Washington, has reduced its energy dependence on Iran: once that country's second largest oil importer, it is now sixth. Washington responded in June by exempting New Delhi from Iran-related sanctions. In mid-September, Deputy Defense Secretary Ashton Carter intimated that Washington is interested in liberalizing its arms export rules for India. According to Carter, such measures would give India "the same status as our very closest allies." Also in mid-September, Indian media reported that New Delhi will relax some of the liability laws that have made U.S. companies hesitant to invest in India's nuclear sector.
Admittedly, improving the relationship will not be easy, as business ties between the two countries may suffer in the months ahead. Major Indian IT firms in the United States are angry about the changes to the U.S. H1-B visa program that make it more difficult for them to recruit Indian workers. Meanwhile, the U.S. private sector, one of the most vocal and important advocates of a stronger U.S.-India relationship, has of late taken a more critical line. Mark Elliot, executive vice president of the U.S. Chamber of Commerce's Global Intellectual Property Center said India's counterproductive trade policies "are leaving us scratching our heads;" Linda Dempsey, vice president of international economic affairs at the National Association of Manufacturers, a D.C.-based advocacy group, said India's policies are "a critical problem for business." Worryingly, the continued slowdown of India's economy -- its GDP grew at an anemic 3.2 percent in 2012, and the precipitous fall of the rupee in August sparked talk of an economic crisis -- has caused India to retreat further inside its protectionist shell.
Even if ties do improve under Singh, they could worsen if he leaves office in 2014. One of the top candidates for next Prime Minister of India is Gujarat Chief Minister Narendra Modi. Because of his role in 2002 riots that left roughly 1,200 Muslims dead, the United States has denied him a visa. While that would probably change if he's elected prime minister, Modi, who his critics call an unpredictable Hindu nationalist, is unlikely to pursue a cozy relationship with the United States. Now is the time for Obama and Singh to institute policies, or at least build goodwill, that shores up the relationship. Otherwise gatecrashers -- whether in the form of Kabul, Modi, Indian trade policies, or the Salahis -- will keep spoiling the party.