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Sovereign Wealth Funds Bet Big on India
Since the outbreak of COVID-19, bad news has dogged India on the economic front. By the end of the 2020-21 financial year, which begins on April 1 and ends on March 31, the country’s GDP is estimated to shrink by 7.7%, the biggest contraction since 1952. In the first quarter of the 2020-21 financial year, the economy contracted by a historic 23.9%.
To put things in perspective, India has suffered its first contraction since the 1979-80 financial year. Then, India’s GDP shrunk by 5.2% because of a double whammy. First, the 1979 Iranian Revolution led to a doubling of crude oil prices, hurting an energy importer like India. Second, a severe drought led to crop failure, falling incomes and declining demand. The 2020-21 recession is worse than that of 1979-1980. In fact, India’s contraction is the second-worst in Asia after the Philippines, whose economy has contracted by 8.5%-9.5%.
Green Shoots of Recovery
In 2021, better news has trickled in. India’s manufacturing sector is rebounding. The Nikkei Manufacturing Purchasing Managers’ Index, compiled by IHS Markit, rose to 56.4 in December 2020, up from 56.3 in the previous month. Any figure over 50 signals growth, and manufacturing has now been increasing for five months. More importantly, India’s agricultural sector is expanding strongly. In fact, it grew even during the peak of the COVID-19 pandemic.
Deloitte estimates that “India may have turned toward the road to recovery.” It bases its judgment on recent high-frequency data. India has been fortunate to have lower infection and fatality rates than countries like the US or the UK. It has also launched the world’s biggest coronavirus vaccine drive. This should improve consumer and business confidence and boost economic recovery.
Why Is Foreign Investment Flooding Into India?
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The International Monetary Fund (IMF) is predicting a return to growth in 2021 as are investment banks and large funds. The Indian government is bullishly claiming that India can achieve double-digit growth through increased digital services and the expansion of its manufacturing base. This would be driven by growing demand in the rural sector, the youth and India’s aspirational middle class.
Even if the government claims might be optimistic, many companies and investors have bought into the India growth story. In particular, sovereign wealth funds (SWFs) have been betting on India. In 2020, they invested a record $14.8 billion in the country. In the same period, they invested only $4.5 billion in China, meaning that SWF investment in India is three times that of China. What is going on?
Dark Clouds in Sunny Skies
To understand why SWFs are turning to India, we have to understand their incentives. These funds do not answer to investors who crave quarterly or yearly or even five-year returns. As custodians of a nation’s wealth, SWFs are long-term investors. In their view, India is operating from a lower base than China. So, India’s growth prospects are higher than China’s as it plays catch-up.
Furthermore, unlike venture capital or private equity players, SWFs place a high premium on the long cycle factors like political stability, social cohesion and geopolitical importance. As a robust democracy with many decades of experience in the peaceful transfer of power, India is increasingly attractive in a volatile, complex and ambiguous world. China’s actions in Hong Kong and Xinjiang have shaken up many SWFs that are choosing to park their money in India.
There is another reason for SWFs to invest in India. They agree with IMF Managing Director Kristalina Georgieva, who praised India for taking “very decisive action, very decisive steps to deal with the pandemic and to deal with [its] economic consequences.” Like her, they are impressed by New Delhi’s appetite for structural reforms and the surprising competence India’s much-maligned government has demonstrated during the pandemic.
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.custom-post-from .error{ display: block; color: #ff6461; order: 3 !important;}On December 31, India’s health ministry revealed that the country’s COVID-19 recovery rate was an astonishing 96.04%. This is one of the highest recovery rates in the world. Despite the economic contraction, the government has fed hundreds of millions, brought in much-needed economic reforms and kept the budget deficit down to reasonable levels. At a time when countries have sunk into unsustainable debt traps, India presents a relatively better investment opportunity for SWFs with strong prospects of sustainable, long-term growth.
There are two dark clouds threatening this sunny economic scenario. First, India faces the twin external threat of China and Pakistan. Both these nuclear powers make territorial claims against India. They have been ratcheting up rhetoric, and tensions are running high. Even at the height of a bitterly cold winter, Indian and Chinese troops have clashed yet again on the border. Once the Himalayan snows start melting in late spring and early summer, troops could start clashing and a military conflict might ensue. This would inflict a tremendous economic setback in the short run. If India is able to defend its territory, then its economy would benefit in the long term. However, there is no guarantee how such a conflict might play out, and this remains a great risk to the economy.
Second, India faces the threat of domestic unrest. The ruling Bharatiya Janata Party has had to deal with numerous protests since its reelection in 2019. The Citizenship Amendment Act triggered protests in many cities across the country. They died down as the pandemic spread. Currently, farmer protests are rocking New Delhi on Republic Day. In a country as large and diverse as India, threats of more protests and unrest are never far away. As long as the government can contain protests, they remain immaterial. However, a breakdown in social cohesion would damage India’s growth story.
The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy. More
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Janet Yellen confirmed as first female treasury secretary
Janet Yellen has been confirmed as the first woman to head the US Treasury.The former chair of the Federal Reserve and noted economist was approved by the Senate on an 84-15 vote. She sailed through a congressional hearing last week and had already been unanimously approved by the Senate finance committee and backed by all living former treasury secretaries.She faces a monumental task. Last week another 900,000 people filed for unemployment benefits – more than the population of San Francisco and four times the number of weekly claims made before the coronavirus pandemic struck.Businesses are closing across the US amid a surge in infections. The US reported more than 188,000 new cases for Thursday, according to data compiled by Johns Hopkins University, and close to 4,000 people are dying each day.At the hearing Yellen said it was imperative for the government to “act big” on the next coronavirus relief package and argued now is not the time to worry about the costs of a higher debt burden.Tackling the fallout of Covid-19 would be her top priority, said Yellen, and especially its disproportionately hard impact on communities of color. Black and Latino workers are still experiencing far higher rates of unemployment, at 9.9% and 9.3%, compared with their white counterparts, 6%.“We need to make sure that people aren’t going hungry in America, that they can put food on the table, that they’re not losing their homes and ending up out on the street because of evictions,” Yellen said. “We really need to address those forms of suffering, and I think we shouldn’t compromise on it.” More
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Deborah Birx says Covid deniers in Trump White House 'derailed' response
The former US coronavirus response coordinator Deborah Birx has said people in the Trump White House considered Covid-19 a hoax.Birx questioned the Trump administration’s response to the coronavirus pandemic in a wide-ranging interview broadcast on Sunday. Elsewhere, advisers to Joe Biden described the new president’s plans to control Covid-19 – a challenge made tougher, chief of staff Ron Klain said, by Trump having left office without a vaccine distribution plan in place.More than 417,000 people have died of Covid-19 in the US, out of a caseload of nearly 25m, according to figures kept by Johns Hopkins University in Maryland.In the White House and in the broader public “there were people who definitely believed this was a hoax”, Birx told Face the Nation, on CBS.The former army physician attributed some such skepticism to people’s different experiences with the virus.“They saw people get Covid and be fine and then they had us talking about how severe the disease is and how it could cause these unbelievable fatalities to our American public,” she said.The process to distribute the vaccine … did not really exist when we came into the White HouseAsked if she blamed some such skepticism on Donald Trump, who repeatedly downplayed the virus, Birx said some statements by political leaders “derailed” the coronavirus response.“When you have a pandemic where you’re relying on every American to change their behavior,” she said, “communication is absolutely key, and so every time a statement was made by a political leader that wasn’t consistent with public health needs, that derailed our response. It is also why I went out on the road, because I wasn’t censored on the road.”Birx, who played a key role in the fight against Aids, said she believed the 2020 election was a factor in how information about the coronavirus was shared and that she had “always” considered quitting her White House role under Trump.“I always feel like I could have done more, been more outspoken, maybe been more outspoken publicly,” Birx said. “I didn’t know all the consequences of all of these issues.”Birx has long promoted a data-driven response to disease outbreaks and she suggested such efforts were undermined by people working in the Trump White House. From the time she arrived until she left, she said, unknown advisers were supplying “parallel” coronavirus data.“I saw the president presenting graphs that I never made,” Birx said.Efforts to vaccinate the public have been plagued by delays while a new and more contagious variant of coronavirus that originated in Britain has been identified in at least 20 states.On Sunday Dr Anthony Fauci, the director of the National Institute of Allergy and Infectious Diseases who also served under Trump but unlike Birx has transitioned to advising Biden, told CBS: “The Moderna and Pfizer vaccines seem to continue to be protective against the mutant strain.”He also said a “mutant” virus variation “now prevalent in South Africa” was “a little bit more concerning”.“It looks like it does diminish more so the efficacy of the vaccine,” he said. “But we’re still within that cushion level of the vaccines being efficacious against these mutants.”On Thursday, the first full day of his presidency, Biden released a 198-page Covid-19 strategy. He has also signed 10 related executive orders or other directives since taking office. The White House said it aims to provide 100m vaccine doses in 100 days.Biden’s nominee for surgeon general, Dr Vivek Murthy, told ABC’s This Week the success of the vaccination campaign should be determined by not just by quantity, but also by how equitably inoculations are delivered.To do this, Murthy said, the government must increase supply by using the Defense Production Act and better targeting distribution with mobile units and community vaccination centers.“We already know from the Covid crisis over the past year that there are certain communities that have been hard hit by this virus,” he said, “that rural communities have had a harder time getting access to resources, that communities of color have experienced more cases and deaths, that seniors have struggled, especially those in long-term facilities”.Murthy also called for a greater investment in treatment strategies, contract tracing and testing. Such efforts combined with people getting vaccinated and adhering to public health guidance, he said, could allow the US to control the pandemic.“If we do these things, and if we continue to work on taking the safety precautions, like masking and avoiding indoor gatherings of people outside your household, then I think we can be on a path to not only turning the pandemic around, but, most importantly, getting our schools open, our workplaces back up and running, and regaining our way of life.”Biden’s nominee for health secretary, Xavier Becerra, warned that improving the pandemic response “won’t happen overnight”.“We can’t just tell the states, ‘Here’s some PPE, some masks, here’s some vaccines, now go do it,’” Becerra told CNN’s State of the Union.Klain, Biden’s chief of staff, told NBC’s Meet the Press: “The process to distribute the vaccine, particularly outside of nursing homes and hospitals out into the community as a whole, did not really exist when we came into the White House.”Klain said obstructions to better distribution include the need for more vaccines, more people to administer shots and more sites to provide it. Klain said the Biden administration was focused on convincing people who are vaccine hesitant, particularly in communities of color, that the vaccine is safe.“Unless we can reduce vaccine hesitancy,” he said, “unless we can get all Americans to take this vaccine, we’re going to continue to see Covid be a problem in our country.” More
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Deborah Birx 'always' considered quitting Trump coronavirus taskforce
Dr Deborah Birx, White House coronavirus task force co-ordinator under Donald Trump, “always” considered quitting as the US lurched into disaster under the 45th president – but didn’t.Speaking to CBS in an interview to be broadcast in full on Sunday, Birx said: “I had to ask myself every morning: is there something that I think I can do that would be helpful in responding to this pandemic? And it’s something I asked myself every night.“And when it became a point where … I wasn’t getting anywhere and that was like right before the election, I wrote a very detailed communication plan of what needed to happen the day after the election and how that needed to be executed. And there was a lot of promise that that would happen.”Joe Biden won the election and was sworn in as the 46th president on Wednesday. Another senior US public health official, Dr Anthony Fauci, has since spoken of his relief over the change of administration.According to Johns Hopkins University, by Saturday morning 413,791 people had died of Covid-19 in the US, out of nearly 25m cases. There were 3,758 deaths on Friday. It was also reported that hundreds of national guard troops who provided security for Biden’s inauguration have tested positive for the virus.[embedded content]“There are national guard troops here from every state in the union, probably,” Birx said. “Young individuals who are most likely to have asymptomatic infection if they do get infected. And they’re congruently living and eating mask-less, 25,000 to 30,000 of them from all over the United States.”Birx said the inauguration could prove to be a massive super-spreader event, because it had brought “30,000 people together where you know that they’re most likely to have asymptomatic infections and you haven’t pre-screened, pre-tested and serially tested.“These are dedicated troops. They’re going to do their mission. I can promise you that they will sacrifice their own health to do their mission, because … that’s what I came from. You sacrifice for others out of the military.”Birx, a US army physician, joined the Trump White House task force after a stellar career in public service, particularly in the fight against Aids.On Friday, as Biden signed executive orders to tackle hunger and economic pressure during the pandemic, the new president predicted a US death toll of more than 600,000. Vaccines were developed quickly under Trump but their rollout has been slow. Biden has promised to oversee 100m vaccinations in his first 100 days in office.The botched vaccination rollout has hit states with the capacity to vaccinate far more people than are currently receiving shots.On Saturday, New York governor Andrew Cuomo said a Trump-era decision that extended eligibility beyond healthcare and essential workers to seniors wasn’t working because of limited supplies. While 7 million New Yorkers are now eligible for vaccines, the state is only receiving 250,000 doses weekly, down from 300,000, Cuomo said.“They said they would increase the supply,” Cuomo told reporters in Albany. “They never did.”Like Fauci and other experts thrust on to the media front line, Birx became a familiar face in a task force all too evidently at the mercy of a mercurial president given to lies, conspiracy theories and the politicisation of every aspect of the public health response.Birx came under fire both from the president, who called her “pathetic”, and Trump’s critics. Nancy Pelosi was reported to have called her “the worst”.Asked by CBS’s Face the Nation if she had considered quitting, Birx said: “Always. I mean, why would you want to put yourself through that, um, every day?“Colleagues of mine that I had known for decades in that one experience, because I was in the White House decided that I had become this political person, even though they had known me forever.”Asked if she thought “the election was a factor in communication about the virus”, she said: “Yes. Yes.”Birx said she had been “censored” by the White House. Asked if she ever withheld information from the public, she said: “No.”Birx was criticised in December for a visit to family despite pandemic restrictions. She told CBS she would “need to retire” from the federal Centers for Disease Control and Prevention, “probably within the next four to six weeks”. More
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Biden executive orders target federal minimum wage and food insecurity
Joe Biden on Friday will sign a pair of executive orders aimed at providing immediate relief to millions of American families grappling with the economic toll of the Covid-19 pandemic and expanding safety protections for federal workers.Sign up for the Guardian’s First Thing newsletterPressing ahead with an ambitious set of executive actions, the new administration is seeking to marshal an “all-of-government” effort to combat hunger as tens of millions of Americans face food insecurity amid historically high unemployment rates.“The American people can’t afford to wait,” said Brian Deese, the national economic council director, on a call with reporters. “So many are hanging by a thread.”The measures, he said, were a “critical lifeline” for American families, but were “not a substitute” for the nearly $2tn relief package Biden has called on Congress to pass.Biden will direct the Department of Agriculture increase a Covid-19 food program that helps families with children who would normally receive free or reduced-price meals at school, as well as expand the emergency increases approved by Congress to the Supplemental Nutrition Assistance Program for low-income Americans.He will also ask the Department of Treasury to update its process for delivering stimulus checks to millions of eligible Americans who reported issues or delays with the first rounds payments. And Biden will the Department of Labor to make clear that out-of-work Americans who refuse employment that could jeopardize their health would still qualify for unemployment benefits. Until now, workers who refused offers to return to their jobs out of concern for their safety no longer qualified for unemployment aid.The second order is aimed at expanding protections for federal workers by restoring collective bargaining powers and lay the groundwork for the federal government to implement a $15 federal minimum wage. As a first step, Biden will direct federal agencies to conduct a review of federal workers earning less than $15 an hour and develop recommendations for raising their wages.The latest executive actions come one day after a labor department report showed that unemployment claims remained at historically high levels, with 900,000 Americans filing for unemployment benefits last week. The figures reflected the magnitude of the economic challenges Biden inherited, amid a resurgence of the coronavirus this winter.Friday’s actions are part of a blitz of executive orders and directives Biden has taken since assuming the presidency.Hours after his inauguration, Biden signed an executive order extending a federal pause on evictions through the end of March, a move that will shield millions of Americans struggling to pay rent amid the pandemic. He also directed federal agencies to extend their moratorium on foreclosures of federally guaranteed mortgages and asked the education department to prolong its freeze on federal student loan payments through the end of September.On Thursday, he unveiled a “full-scale wartime” national Covid-19 strategy aimed at growing the production of vaccines, creating guidelines to reopen schools and businesses and imposing new requirements on mask-wearing.Biden has long argued that economic recovery is tied to combatting the coronavirus, a starkly different approach to his predecessor who urged states to lift restrictions even as infections rose.The centerpiece of Biden’s plan to address fallout from the pandemic is a $1.9tn relief package called the American Rescue Plan, which includes $1,400 direct payments to Americans, more generous unemployment benefits and billions of dollars for a national vaccination program.Already Republicans are objecting to the cost of the legislation, raising doubts about whether Biden will be able to attract bipartisan support as he had hoped. Several Republicans have questioned the need for an additional relief package weeks after they passed a $900bn coronavirus relief bill.Stressing that urgent action was needed, Deese declined to say how long the White House planned to court Republican support before potentially moving to a process that would allow Democrats to move the legislation forward without them.His team plans to hold a conference call with a bipartisan group of senators on Sunday to make the case for another round of stimulus, without which he said the nation’s economy would plummet further into “a very serious economic hole”.“When you’re at a moment that is as precarious as the one we find ourselves in,” he said at a White House press briefing on Friday, “the risk of doing too little the risk of undershooting far outweighs the risk of doing too much.” More
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Biden team in race against time as new strain threatens to intensify Covid wave
Joe Biden’s new administration is faced with a monumental task in curbing the deadliest wave of the Covid-19 pandemic so far in a race against time before a new, more contagious coronavirus variant threatens already strained US health resources.The Biden administration has mere weeks to speed vaccine deployment, and convince more Americans to wear masks, wash hands and social distance. And it must be done amid a rocky transition, critical supply shortfalls, widespread new infections, shaky public trust and a vaccine rollout that “has been a dismal failure so far”.“Let me be very clear, things are going to continue to get worse before they get better,” said Biden, at a Covid-19 briefing on Thursday afternoon. “The memorial we held last night,” to mark 400,000 American deaths, “will not be our last one. The death toll will likely top 500,000 next month.”More than 408,000 Americans have so far died from Covid-19 since the beginning of the pandemic, and more than 24 million infected: by far the worst numbers in the world.To date, 16.5 million people in the US have been vaccinated, according to federal health authorities.At the same time, the US Centers for Disease Control and Prevention (CDC) has now issued stark warnings about a more infectious new variant of Covid-19, called B117. The variant has already forced England into a weeks-long lockdown.Various scenarios could play out. In one model, Covid-19 infections decline in March, only to crest again in late April and early May driven by B117 infections. This model assumed there was no widespread community vaccination. In another model, B117 still overtakes current strains, but it declines alongside current dominant strains. The decline would take place in an environment of overall reduced transmission, because people maintain social distance and vaccines are distributed to about 1 million a day.This endpoint can be reached, CDC modelers said, but only if people curb the spread of Covid-19 and vaccine uptake is high. Biden has repeatedly pledged to vaccinate 100 million Americans in 100 days, which would roughly match modeling by the CDC.“We need to ask average Americans to do their part,” said Jeff Zients, the White House Covid-19 response director. “Defeating the virus requires a coordinated nationwide effort.”In the worst-case scenario, already strained hospitals would be under more pressure, social distancing would need to be more stringent and extended, and more people would need to be vaccinated to make a difference. That scenario more closely matches England’s lockdown, undertaken when cases peaked in early January.Further, while B117 is the only variant known to be more contagious currently circulating, it is not the only variant to be worried about. Strains identified in South Africa and Brazil also hold the potential to be more transmissible, CDC researchers said.In the face of these new variants, Biden and his administration spent its first evening and full day in office building infrastructure to respond to the crisis.“The issue he wakes up everyday focused on is getting the pandemic under control,” said Jen Psaki, White House press secretary at the first press briefing on Wednesday evening. “The issue he goes to bed every night focused on is getting the pandemic under control.”Biden has signed a flurry of executive orders to try to control the situation, including setting up new federal vaccination sites, using the Defense Production Act to boost much-needed supplies, requiring masks to be worn on federal property and numerous other actions. Zients acknowledged on Thursday that the Trump administration’s vaccine rollout planning was, “so much worse than we could have imagined”, the New York Times reported.Buy-in by America’s state governments is also important for distributing vaccines quickly and equitably. Florida’s Republican governor, Ron DeSantis, who was closely aligned with Donald Trump, held a press conference on Wednesday to tell Biden not to bother coming to his state.“I saw some of this stuff Biden’s putting out, that he’s going to create these Fema camps. I can tell you, that’s not necessary in Florida,” DeSantis said, the Tampa Bay Times reported. “All we need is more vaccine. Just get us more vaccine.”Further, the urgency to vaccinate people has led some public health officials to shy away from documenting that vaccine recipients are members of priority groups, such as the elderly or essential workers.In Mississippi, the state’s top health official, Dr Thomas Dobbs, said requiring documentation is not something the state is “going to do” because he did not want to erect roadblocks to vaccination. He added: “We will get [the] vaccine out where we can as much as we can,” he said on Thursday. “It’s going to be a little bit lumpy, and that’s just the way it is.” More
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Anthony Fauci describes 'liberating feeling' of no longer working under Trump
Sign up for the Guardian Today US newsletterAnthony Fauci, the top infectious diseases expert in the US, spoke on Thursday of a “liberating feeling” of being able to speak scientific truth about the coronavirus without fear of “repercussions” from Donald Trump.Fauci, the director of the National Institute of Allergy and Infectious Diseases, endured a tortuous relationship with the former president and was increasingly sidelined from public briefings.But the 80-year-old returned to the White House podium on Thursday after Joe Biden released a national Covid-19 strategy and signed 10 executive orders to combat a pandemic that has now claimed more than 400,000 lives in the US.“One of the things that we’re going to do is to be completely transparent, open and honest,” Fauci told reporters. “If things go wrong, not point fingers, but to correct them. And to make everything we do be based on science and evidence.“That was literally a conversation I had 15 minutes ago with the president and he has said that multiple times.”Asked if he would like to amend or clarify anything he said during the Trump presidency, Fauci insisted he had always been candid, noting wryly. “That’s why I got in trouble sometimes.”Fauci and other public health advisers were forced to walk a delicate line as the president used coronavirus taskforce briefings to downplay the virus, push miracle cures and score political points. On one occasion Trump mused about injecting patients with disinfectant but the response coordinator Deborah Birx remained silent.Fauci’s frankness did not go unnoticed. During the election race in October, Trump reportedly told campaign staff: “Fauci is a disaster. If I listened to him, we’d have 500,000 deaths.” At a rally in early November, as crowds chanted “Fire Fauci! Fire Fauci!”, the president suggested he might do just that.At Thursday’s briefing, Fauci was asked how it feels to no longer have Trump looming over him. “Obviously, I don’t want to be going back over history but it’s very clear that there were things that were said – be it regarding things like hydroxychloroquine [pushed as a treatment by Trump] and things like that – that really was uncomfortable because they were not based on scientific fact.“I can tell you, I take no pleasure at all in being in a situation of contradicting the president, so it was really something that you didn’t feel that you could actually say something and there wouldn’t be any repercussions about it. The idea that you can get up here and talk about what you know, what the evidence, what the science is and know that’s it, let the science speak, it is something of a liberating feeling.”Although Biden had just condemned vaccine distribution under the Trump administration as a “dismal failure so far”, Fauci said the new team is “not starting from scratch” as it tries to get shots in arms more quickly. “I believe the goal that was set by the president, of getting 100 million people vaccinated in 100 days, is quite a reasonable goal.”He added: “If we get 70% to 85% of the country vaccinated, let’s say by the end of the summer, middle of the summer, I believe, by the time we get to the fall, we will be approaching a degree of normality.”Possible US plateauFauci told the briefing that, based on seven-day averages, the coronavirus may be plateauing in this US but warned that there can always be lags in data reporting. “One of the new things about this new administration: if you don’t know the answer, don’t guess,” he said.After Fauci’s return to the west wing, Nicole Wallace, a former White House communications director, told viewers of the MSNBC network: “It seems like this briefing will forever be remembered as the one where Tony Fauci got his groove back.”The executive orders signed by Biden establish a Covid-19 testing board to increase testing, address supply shortfalls, establish protocols for international travelers and direct resources to hard-hit minority communities. They also require mask-wearing in airports and on certain public transport, including many trains, planes and intercity buses.Fauci was followed at the restored daily White House briefing by the press secretary, Jen Psaki. She confirmed that the new administration would seek a five-year extension of the New Start treaty with Russia that limits the arsenals of both countries to 1,550 deployed strategic warheads each.The 2010 treaty, the last remaining arms control treaty in the wake of the Trump administration, is due to expire on 5 February, but an extension would be feasible if Russia agrees, even in the remaining two weeks. Vladimir Putin has signaled he is open to an extension.“The president has long been clear that the New Start treaty is in the national security interests of the United States, and this extension makes even more sense when the relationship with Russia is adversarial as it is at this time,” Psaki said. “New Start is the only remaining treaty constraining Russian nuclear forces, and is an anchor of strategic stability between our two countries.”But she added that the administration would “hold Russia to account for its reckless and adversarial actions” and that US intelligence would assess the Solar Winds cyber-attack last year, the attempted murder of the Russian opposition leader Alexei Navalny and reported Russian bounties for the killing of US soldiers by extremist groups in Afghanistan. More
