Ignore trade irritants, focus on strategic ties
The Trump team recognises that India’s emergence as a global power has the potential to transform the Indo-Pacific region and the world
In the first Trump administration, Indian Prime Minister (PM) Narendra Modi visited the White House in June 2017, six months after Donald J Trump took power. This time around, Modi will visit the White House less than one month into President Trump’s second term. The question is whether Modi’s early venture into Trump’s world — which has been marked by an unusual level of chaos and disruption — will pay off for India.
Chances are that the Modi-Trump meeting will go smoothly. India’s foreign minister S Jaishankar already had a successful meeting with his counterpart, secretary of state Marco Rubio, on the latter’s first day on the job. Modi and Trump also spoke on the phone one week after inauguration day. The Trump administration’s early attention to India is notable, given all that is happening in the United States (US), including the shuttering of the US Agency for International Development (USAID), which has roiled the international development community.
Modi will be the fourth foreign leader to step into the middle of the American tumult. During the Israeli PM’s visit last week, President Trump surprised observers with an unexpected proposal for the US to take control of the Gaza Strip. Trump’s meeting with Japanese PM Shigeru Ishiba last Friday was less attention-grabbing, and notable for its friendliness and lack of confrontation. Modi hopes for similar treatment.
Trump’s priorities will be the deportations of illegal Indians and India’s notoriously high tariffs. Modi appears prepared to take the heat. Last week, India announced it was lowering import duties on high-end motorcycles, a move that will open the door for the US to export more Harley-Davidson bikes to the country. India may also offer to purchase more American oil and gas to narrow the US trade deficit.
India has also accepted over 100 Indian citizens deported from the US for entering the country illegally, although the Indian Opposition has complained about the treatment of the deportees, who were transported in shackles in an American military plane. India has pledged to take back additional deportees, so long as they have documentation proving their Indian citizenship.
India’s opening gambit on trade is unlikely to quench Trump’s desire to access the Indian market. Trump already is planning to slap 25% tariffs on steel and aluminium imports, putting at risk nearly one-fifth of Indian exports to the US. To avoid a trade war, the two sides will need to announce fast-track trade negotiations.
The two sides failed to reach a trade agreement during Trump’s first term. Instead, Trump withdrew India’s Generalised System of Preferences (GSP) trade privileges in 2019 shortly before Modi won re-election. Still, overall strategic relations stayed largely on track, despite the friction over trade. The Trump trade team’s expectations of India will be higher this time around, however. There will be a greater risk that a failed trade negotiation could sour bilateral ties since Trump’s remarkable political comeback has bolstered his confidence and diminished his appetite for compromise.
Trump also will look for India to commit to buying American defence equipment. During Trump’s successful February 2020 visit to India, he closed defence deals worth $3 billion. Now the two sides are negotiating India’s purchase and co-production of combat vehicles and jet engines.
The Trump team is clearly prioritising relations with India and recognises that India’s emergence as a global power has the potential to transform the Indo-Pacific region and the world. That is why Rubio’s first meeting as secretary of state was with the Quad foreign ministers from India, Japan, and Australia. Quad — revived in 2017 during Trump’s first term — is a critical block to meet new economic and security challenges, and the Trump administration’s decision to hold a Quad foreign minister’s meeting in its first week sends a strong signal to China and others about its commitment to working with allies and partners to meet challenges in the Indo-Pacific. Trump has already hinted that he will attend a Quad leaders’ meeting in New Delhi this fall, marking the first time a US President would visit India during the first year in office.
Another topic of discussion could be technology cooperation. The signature Biden initiative with India was launching the Initiative on Critical and Emerging Technologies (iCET) dialogue in 2023 which provided a framework to deepen technological cooperation between the US and India. When PM Modi visited the US in June 2023, the two sides announced the co-production of jet engine technology, a landmark agreement that was negotiated under iCET. The two sides later announced initiatives in biotechnology and semiconductors and discussed 6G technologies and collaboration in quantum technologies and Artificial Intelligence.
The Trump administration is likely to maintain a high-level dialogue with India on technology cooperation, though it may be branded differently (a shame, given the catchiness of the iCET acronym). There is a strong incentive for the US and India to cooperate on technology to diversify supply chains and help one another compete effectively in the technology race with China.
Modi has likely calculated correctly in making the trek to Washington early in Trump’s second term. Trump is serious about wielding tariffs against friend and foe alike, and India won’t escape the net. Better for Modi to signal early efforts to reduce the US trade deficit and to remind Trump of the geopolitical underpinnings of the relationship. It will be critical for Washington and New Delhi to find a modus vivendi on trade so that friction over the issue does not hinder progress on strategic ties that are necessary to shape a peaceful and stable Indo-Pacific.
Lisa Curtis is director of Indo-Pacific Security at the Center for a New American Security and previously served as deputy assistant to the President and NSC senior director for South and Central Asia from 2017 to 2021 during the first Trump administration.The views expressed are personal