India-US Ties in Trump 2.0: On a ‘’Bigger, Bolder and More Ambitious’’ Trajectory

India-US relations have been in a sweet spot since the last twenty-five years starting with the visit of US President Bill Clinton to India in March 2000. There has been a bipartisan consensus in both India and the US regarding stronger and more dynamic ties between the two nations.

There was considerable anxiety in most countries in the world at the election of Donald Trump in early November 2024 as the 47^th President of the United States. The reason is because Trump is known to be unpredictable and unconventional as well as transactional. In his First Term, Trump was seen to be tentative and unsure primarily because his election in 2016 came as a shock, not only to the world but to himself also.

Obstacles he faced in his First Term are not present today. He not only won decisively in garnering a majority of the Electoral College votes but also swept all the seven swing states and registered a convincing win in the popular votes as well.

All this has imbued Trump with greater confidence to carry through his Agenda to ‘’Make America Great Again’’. He has nominated and installed his loyalists to all major and significant positions in his Cabinet.

Under these circumstances, the world watched with anxiety Trump’s ascent to authority on January 20, 2025. India however felt much more reassured because of the underlying structural factors binding the two countries and the warm and cordial relations between PM Modi and President Trump. It was sanguine that it would lead the relationship to a stronger level. This is exactly what appears to be happening. While Addressing the Press Conference in Washington DC on January 22, 2025, after participating in the inauguration of President Trump the previous day, External Affairs Minister Dr. S Jaishankar said that his interactions with senior members of the incoming Trump Administration led him to believe that there was ‘’a consensus between us that we need to be bolder, bigger, more ambitious.’’ This sentiment was also evident in recent conversations between PM Modi and President Trump, especially on January 27, 2025, soon after Trump’s assumption of power.

India-US Relations in Trump 1.0

The course of India-US ties in Trump 1.0 was transformative. In this period (2017-21), India emerged as an indispensable partner to the United States. The Trump administration backed India on the issue of terrorism. It supported designation of Jaish-e-Mohammed chief as a global terrorist by the UN Security Council and grey listing of Pakistan by the Financial Action Task force (FATF). India-US defence ties received a major boost as India was elevated to Tier 1 of the Strategic Trade Authorization (STA) which placed India at par with US’s NATO allies for import of sensitive technologies. India’s defence procurement from the US rose to $18 billion in 2019.  On the geostrategic front, Trump identified China as a ‘’strategic competitor.’’ This resulted in the resurrection of the Quad and to the re-naming of the US Pacific Command as the US Indo-Pacific Command, and rechristening of Asia-Pacific as the Indo-Pacific. India also signed the two remaining Foundational Defense Agreements viz. COMCASA in 2018, and BECA in 2020. India’s increased import of crude and LNG from the US. Bilateral relations were however also marked by challenges like differences over tariffs, Trump’s offer to mediate between India and Pakistan on Kashmir issue etc.

The period witnessed two major public events viz. ‘’Howdy Modi’’ in Houston in 2019, and ‘’Namaste Trump’’ in Ahmedabad in 2020 in which both PM Modi and Trump participated.

It can be expected that bilateral ties will touch fresh highs in Trump 2.0 although there are likely to be some hiccups too.

Likely Contours of India-US Ties in Trump 2.0

Some major issues which are likely to occupy center-stage in the coming months are given below:

Illegal Migration: India has categorically stated that it is not in the business of pushing its nationals illegally into the US or any other country. As in the past, it would be prepared to accept those individuals who are staying in the US illegally, once their identity of being Indian citizens is proved beyond doubt. This Indian stance will be a matter of satisfaction for the Trump Administration.

H1B Visas: President Trump and his Buddy-in-Chief Elon Musk have spoken out categorically in favor of legal migration of talented and skilled professionals. There has been some opposition on this account from the MAGA support base, but it is likely that Trump and his Team will be able to overcome this. There has been some misuse of the H1B provisions. India will welcome suitable reforms so that the H1B provisions are used genuinely for the intended purpose.

Birthright Citizenship: This is a provision of the US Constitution which grants citizenship to any person born in the US. Withdrawal of this facility will affect many Indian H1B professionals stationed in the US. Grant of Birthright Citizenship is the sovereign prerogative of the US government and India should not expend its political capital on this issue. Trump Administration’s decision on this issue has been challenged in several US courts. The future in this regard is uncertain. Concerned Indian professionals and students will need to decide whether they would like to work in the US or not.

Tariffs and Trade: Trump has called India the ‘’Tariff King/Tariff Abuser’’ and threatened to take action against the much higher tariffs it imposes on US products. India had a trade surplus of $36.74 billion with the U.S. in 2023-24. India figures at number 13 in the list of countries who have a trade surplus with the US. Many others like China, Mexico, Vietnam, Ireland and others have much higher trade surpluses with the US. However, India has been in the cross hairs of Trump on account of its higher import tariffs. India should be ready to offer some concrete concessions for technologically advanced products in which the US has significant commercial interest. The possible visit by PM Modi to the US in February 2025 to which Trump has alluded would be a useful opportunity for an in-depth conversation with Trump to resolve the issue. At the end of Trump 1.0, discussions had been held on a mini-Trade Deal. Possibly these discussions could be revived to ensure that the issue does not boil over. Even before PM Modi’s visit to Washington DC, in February or later, India could send a strong signal about India’s intent to have a collaborative partnership with the US in this sensitive space.

Several Economists have recommended that India should significantly lower and rationalise its tariff structure to integrate itself with the Global Value and Supply Chains. A voluntary reduction in tariffs while ensuring that sensitive sectors like agriculture, dairy etc. are safeguarded, would provide a strong fillip to the economy which has shown signs of faltering in recent months.

Although higher US tariffs could adversely impact exports of some Indian goods, India’s service exports could offset this decline.

China: Since his election, Trump has been sending mixed signals regarding China. Initially he had threatened that he would impose 60% additional tariff on all Chinese imports, notwithstanding statements by some experts that this would result in higher prices to American consumers. Later he backed down from this. He invited Chinese President Xi Jinping to his inauguration. This was a strong signal that Trump wanted a Deal with China. In his first Term, Trump had banned TikTok in America. However, notwithstanding US Supreme Court’s ruling for TikTok to close its operations in the country, Trump, gave it a reprieve of 75 days. Trump also called up Xi Jinping just before assuming power and held discussions to ‘’solve many problems together…. balancing Trade, Fentanyl, TikTok, and many other subjects. President Xi and I will do everything possible to make the World more peaceful and safer!” This indicates Trump’s desire to have a positive relationship with China.

To strengthen his negotiating leverage, Trump could impose some penal tariffs on China. This could provide some space for Indian products in the US market. India should capitalize on such emerging opportunities. Trump’s pushback could also result in foreign investments locating to other destinations. India should be ready to not miss out on China +1 Investment opportunity this time. Such fresh investments will help India to become an integral component of the Global Value Chains.

Even if the US gets a satisfactory Trade Deal with China, its relations are likely to be adversarial because China’s end objective is to displace US from its position as the hegemon of the world. China will not take its eyes off this goal, irrespective of what tactical arrangements and compromises it enters into with the US.

India will need to keep a close watch on the evolving ties between the US and China and while further expanding and deepening its relations with the US, continue to work towards non-confrontational relations with China.

Defence: In his conversation with PM Modi, Trump pressed for greater import of US security equipment by India. The US has in recent years emerged as the second largest supplier of advanced defence equipment to India. The total inventory today is above US$25 billion. Collaboration in this critical sector is likely to continue. India should insist on greater technology transfer and more joint development and production of sophisticated defence systems and platforms. This engagement should transform to include technology transfer also.

Technology: India and the US embarked on ambitious collaboration in critical and emerging technologies during the Biden Administration specifically in semiconductor manufacture in India with support of several US companies. Mike Waltz, the new National Security Adviser will be the point person in this regard. Waltz understands India well having been the co-Chair of India Caucus. Cooperation in this vital sector should not only continue but also be expanded.

Geopolitics: The Indo-Pacific and the Quad: The first meeting of Quad foreign ministers was held one day after the inauguration of President Trump. Collaboration towards a free, open and prosperous Indo-Pacific and ensuring the freedom of navigation and overflights in the Indo-Pacific would be a priority issue for the Trump Administration. It was decided that the next Quad Summit will take place in India.

The pressure on China against its aggressive policies in the South and East China Seas and elsewhere will continue unabated. Notwithstanding the initial conflicting signals on China by Trump, it will continue as a significant ‘’strategic competitor’’ for the US.

Conclusion: India is confident that it will be able to guide India-US ties on an upward trajectory during Trump 2.0. This is reflected in the warm, friendly and long conversation that PM Modi and President Trump had on January 27, 2025. The areas of convergence on bilateral and global issues ranging from West Asia, Russia-Ukraine conflict, Indo-Pacific etc. are much greater than divergences on some aspects. India would be ready to have intense negotiations on trade, tariffs, immigration, defense procurement and other similar matters to arrive at mutually acceptable win-win solutions.

India can be reasonably sanguine that the Trump Administration will put the Deep State in the US which has sought to interfere in India’s internal affairs on a tight leash. Also, there will be a greater meeting of mind on regional issues particularly on the rise of Islamic fundamentalism in India’s neighborhood, especially in Bangladesh. India will however need to be vigilant, alert and nimble to safeguard its core interests of security, stability and well-being.

India-US relations can be expected to advance rapidly in the foreseeable future, and be a force for bilateral, regional and global peace, security and prosperity. The possible visit by PM Modi to Washington DC in February, or soon thereafter, will be an optimum opportunity to navigate the bilateral ties to fresh heights of cooperation and partnership.

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