Transactional turn: On India and the new U.S. administration.
India must push back against the U.S. and safeguard its interests.
Prime Minister Narendra Modi’s visit to Washington last week was brief but packed with headline-generating developments. The visit came less than a month after U.S. President Donald Trump was sworn in, making Mr. Modi the fourth world leader to hold bilateral meetings with him, following the leaders of Israel, Japan, and Jordan, all close U.S. allies. The joint statement issued afterwards outlined a range of substantive discussions. While many announcements focused on India’s purchases of American goods and investments in the U.S., they managed to avoid some of the tough measures many had anticipated. Both sides launched ‘Mission 500’ ($500 billion in bilateral trade by 2030) and initiated discussions on a free trade agreement, with phase one of the draft expected this year. Mr. Trump announced an increase in Indian purchases of U.S. energy, oil, and defence equipment, moves expected to help balance the $45.7 billion U.S. trade deficit within the total $130 billion goods trade. Additionally, there was agreement on a new umbrella framework, COMPACT, or Catalyzing Opportunities for Military Partnership, Accelerated Commerce & Technology for the 21st Century, to streamline cooperation across key sectors. They also rebranded the Biden-era Initiative on Critical and Emerging Technologies (iCET) as Transforming the Relationship Utilising Strategic Technology (TRUST), focusing on semiconductors, quantum computing, and AI, with a commitment to developing an AI infrastructure road map this year. A significant moment came when Mr. Trump announced his approval of the extradition of Tahawwur Rana, involved in 26/11 attacks, to India for trial.
Once the dust settles on Mr. Trump’s unconventional remarks and Mr. Modi’s rare engagement with the media in this format, India must assess the broader takeaways from this visit. The positive optics and their camaraderie signal a strong foundation for India-U.S. relations over the next four years. There is also clear continuity in key areas of strategic partnership, including Indo-Pacific engagement and the Quad, with Mr. Trump’s planned visit to Delhi for the Quad Summit later this year expected to reinforce these commitments. However, economic discussions, trade, energy, nuclear cooperation and defence are likely to dominate the India-U.S. agenda, giving the relationship a transactional turn reminiscent of Mr. Trump’s first tenure. There is not much evidence that Mr. Modi’s visit significantly softened Mr. Trump’s stance on imposing counter-tariffs and reciprocal taxes or influenced a more humane approach to the deportation of undocumented immigrants aboard military flights. These could present challenges for the Indian government going forward. As India engages with the new U.S. administration, it must carefully assess its own interests, assert its position where necessary, and push back when required to safeguard its strategic and economic priorities.