The recent meeting between Indian Prime Minister Narendra Modi and US President Donald Trump at the White House appeared to deal with the complexities plaguing relations between the two countries. Though both leaders agreed to build a "mega partnership", realities on the ground are marred by challenges related to tariffs, trade deficits, and strategic deals, among other things.
The US under Trump 2.0 has been behaving in an inward-looking manner. Trump’s characteristic tariff wars have not left India untouched. The US President has termed India’s high tariffs to be a “big problem.” He has been consistent in highlighting the fact that India’s tariffs are way higher than what the US imposes on Indian goods. With this argument, Trump is tactically building a base for reciprocal tariff attacks. Modi, keen to ease trade tensions, has shown openness to lowering tariffs and increasing imports from the US, particularly oil and gas. India’s decision to buy more US energy is aimed at reducing the trade gap, but this move comes with risks. With a strong US dollar, American oil and gas could be expensive for India, making it a tricky economic choice. Analysts are already questioning Modi’s ‘submissive’ approach to diplomacy vis-à-vis the US. India’s energy needs are growing day by day, and diversifying its sources is indeed crucial. Traditionally, India has imported oil from the Middle East, Russia, and other nations, but increasing imports from the US may strengthen bilateral relations with the Western giant. However, this also means that India could face economic pressure if US policies change or if energy prices become unstable. By choosing to rely more on the US for energy, India is making a strategic gamble that could lead to long-term dependence on expensive imports.
Beyond trade, defence cooperation also took centrestage at the discussions. The two leaders announced plans to expand military ties, with India considering purchases of advanced US fighter jets and technology-sharing deals. Strengthening defense collaboration aligns with both countries’ goals, particularly in countering China's influence. The US is keen on selling high-end military equipment, and India sees this as an opportunity to modernise its armed forces. Nevertheless, India must be careful not to become overly dependent on US military hardware, given past restrictions on technology transfer. Any agreement must be aimed at ensuring that India retains control over its defense strategies while benefiting from advanced military technology.
Yet another critical issue discussed during the meeting was immigration. Trump announced the extradition of a suspect in the 2008 Mumbai attacks, a move welcomed by Modi. However, the US has also been tightening its immigration policies, which will have adverse impact on Indian nationals living in the US. Many Indian professionals rely on H-1B visas to work in the US. Any further restrictions on this front could strain people-to-people relations. The H-1B programme has been a key driver of India's IT industry, and any cuts could disrupt the livelihoods of thousands of Indian professionals. Indian students in the US also contribute billions to the American economy, making it essential for both countries to find a balanced approach towards resolving visa issues. If the US enforces stricter visa policies, it may push Indian talent towards countries like Canada, Australia, and Europe—eventually weakening US-India economic ties in the long run.
In addition to trade, defense, and immigration, both leaders discussed broader multilateral cooperation. India and the US have been strengthening ties in the Indo-Pacific region, working together through platforms like the Quad alliance. Both nations have concerns over China's growing economic and military influence, and greater strategic coordination is likely. However, India must navigate its position carefully in a seemingly bipolar world. Modi’s catchy "MAGA plus MIGA" slogan may sound appealing, but slogans alone won’t resolve the complexities of trade and diplomacy. India must weigh its options carefully to ensure that it benefits from these agreements without compromising its own long-term interests.