Why prosperity in the U.S. and India now rise — or fall — together

As global economic relationships evolve, Achyuta Adhvaryu, professor of economics at the University of California San Diego School of Global Policy and Strategy and director of the 21st Century India Center, says one partnership stands out for its potential to drive shared prosperity: the connection between the United States and India. His research highlights how the two nations’ economies have become deeply intertwined through flows of talent, technology and innovation — and why keeping those ties strong is essential for growth on both sides.

Why do you describe the U.S. and Indian economies as “intertwined”?

The relationship has evolved far beyond trade in goods. It’s now defined by the movement of ideas and skilled people — scientists, engineers and entrepreneurs who power innovation across both countries. Many U.S. companies rely on highly trained professionals in India through what we call Global Capability Centers (GCCs). These hubs handle everything from product design to AI strategy. The success of U.S. firms increasingly depends on these deep collaborative networks.

How did this partnership develop?

It’s the product of both economic reform in India and U.S. immigration policy. When India liberalized its economy in the 1990s, it became much more open to global business. Around the same time, the H-1B visa program in the U.S. encouraged more Indians to pursue STEM education and high-skill careers. Some of those professionals stayed in the U.S.; others returned home to build new capabilities. That created a feedback loop — a “brain gain” that has benefited both countries.

What exactly are Global Capability Centers and why are they so important?

Think of them as satellite innovation hubs. GCCs aren’t factories — they’re extensions of the global teams of companies like Apple, Google and Goldman Sachs. Today, India hosts roughly 1,800 of them, employing about 2 million professionals. They contribute around $65 billion annually, much of it supporting U.S. companies’ operations. These centers make American firms more productive and globally competitive.

How does this connection affect everyday prosperity in the U.S.?

It’s easy to think of globalization as something that only benefits large corporations, but the impact runs deeper. When U.S. companies innovate faster, they create better products, new industries and more jobs here at home. The partnership with India helps make that possible — it keeps costs manageable, speeds up development and strengthens America’s position in cutting-edge sectors like AI and biotech.

Are there risks if these ties weaken?

Absolutely. Policies that restrict talent movement or make collaboration more difficult — whether through higher visa fees or trade barriers — can disrupt the system that underpins both economies. When trust erodes, investment slows. And when the U.S. pulls back, other countries — including China — are ready to step in.

What should policymakers focus on instead?

The goal should be balance — protecting domestic opportunities while nurturing international collaboration. That means supporting education and workforce development at home, but also keeping pathways open for high-skill talent and innovation partnerships abroad. The prosperity of the U.S. and India isn’t a zero-sum game; it’s deeply interconnected.

Achyuta Adhvaryu, professor of economics at the School of Global Policy and Strategy and director of the 21st Century India Center

You’ve written about this relationship in very personal terms. Why does it matter to you?

I grew up in the U.S. in the 1980s, when India’s economy was much more closed. Back then, our trips to India were filled with suitcases of American goods for family — small things that were hard to find there. Today, what connects the two countries isn’t what’s in our suitcases; it’s what’s in our minds. It’s ideas, research and shared innovation. That’s what makes this partnership so powerful.

What do you hope people take away from your research?

That prosperity in the U.S. and India rises together. Collaboration in science, technology and education doesn’t just drive growth abroad — it makes life better here, too. The stronger our connections, the more resilient and innovative our economies become.

For more information about the 21st Century India Center go to the center’s website.