In the first six months of his second tenure, Donald Trump has succeeded in implanting his agenda in a range of areas. His tariff policy that has seen major countries fall in line has yielded over $100 billion revenue. He has managed to pass his “big, beautiful bill” slashing taxes and cutting expenditure. He’s on top of the issue of illegal migrants as well, and, despite the Epstein issue, his base is intact, though his approval ratings are slowly drifting downwards.

But there is one area in which the US is floundering – relations with its friends and allies. The US remains a formidable military power. But it has, under Trump, shorn itself off the trappings of a soft power such as a policy friendly to immigrants and foreign students, aid programmes for social development, health and medical care, diplomacy and multilateralism. By treating friend and adversary alike, Trump has undermined something that is not easy to quantify – trust.

Neighbours and the EU

Perhaps the greatest erosion has been among its oldest friends and neighbours – Mexico, Canada and Europe. Trump has finally managed to push the Europeans to a trade deal, boost their defence expenditure and take charge of the aid to Ukraine. But at the same time, he has triggered deeper responses among the Europeans about the future of their security.

In 2022, Trump’s first term led to the EU adopting The Strategic Compass, the blueprint of a plan to fortify their defence by 2030. As part of this they planned to enhance their crisis response capabilities by raising a Rapid Deployment Capacity and improving their joint command and control structures.

In early March, the EU unveiled a five-part plan to boost the groupings’ defence industry and increase its military capability. This would raise some € 800 billion and help provide aid to Ukraine as well.

This is also driving efforts of the Europeans to restructure their nuclear defence posture. In a TV address in early March, French President Emmanuel Macron warned against Russian aggression, noting that “I want to believe that the US will stay by our side, but we have to be ready if that isn’t the case.” He said he would discuss extending French nuclear deterrence to other countries.

A few days later, Friedrich Merz, then the German Chancellor-elect said that he would reach out to the UK and France to discuss the sharing of nuclear weapons. He denied that this was intended as a replacement of the current US shield Germany enjoyed.

The June NATO summit saw the issue of enhanced defence expenditure resolved amicably. Trump, who had earlier signalled doubts as to whether the US would aid NATO if it were attacked, agreed to endorse the “ironclad” guarantee of collective defence. This has led to some scaling back of the more ambitious plans for a European deterrent. As the Wall Street Journal noted, they are now “shaping up as an evolution, not a revolution.” But they are clearly not going away. And a great deal here has to do with the loss of trust in the US.

East Asia

The principal American allies in East Asia have fewer options. Taking its hint from the rough treatment by the first Trump Administration and the lessons of the Ukraine war, Japan re-wrote its national security strategy in 2022. Besides a commitment to double its defence expenditure to 2% of its GDP, Tokyo decided it would acquire an offensive counter-strike capability in the form of long-range American cruise missiles.

This way Japan hoped to meet the Trump challenge more than half way and embrace even closer partnership with the US. But this was clearly not enough and US officials have now called for even greater defence spending increases by its Asia-Pacific allies. Japan called off a planned July meeting of US and Japanese defence and foreign ministers because of this. Even Australia criticized Washington’s fresh demands and a few days later the Pentagon announced a review of the AUKUS submarine deal which was supposed to be a centrepiece of US commitment to Australia’s security.

The signing of the US-Japan trade deal may suggest that all is well now between Washington and Tokyo but you can be sure that Japan is also looking at ways to hedge against US inconsistency.

Australia

There are similar concerns in Australia, not only over the future of AUKUS, but the curtailment of US softpower policies of aid, trade and diplomacy, which have hit the policy of wooing South Pacific nations, an area witnessing intense competition between the western allies and China. Reports suggest that the AUKUS deal will continue as before, but Australia may have to shell out more money or make specific commitments with regard to Taiwan.

Though things look stable in the ties between the US and Japan and Australia for now, the bonds of trust have been loosened, as even now there are uncertainties surrounding the US policy in relation to China. At one level, policies in the recent past seemed to suggest that the US wants to lead its allies in a new Cold War and an economic decoupling from China. On the other hand, ground realities suggest that it is readying to make a deal.

China

Recently, the US and China have signed a framework agreement that has seen Beijing ease up on rare earth magnet exports to the US. In turn Washington has agreed this month to allow the export of Nvidia’s H20 chips to China used for AI applications. Both have scaled back on the high tariffs they imposed on each other.

This week, the two countries are heading for another round of talks, this time in Stockholm, and the indications are that Trump is coming around to striking an economic bargain with China. Currently US tariffs are around 30-50% on Chinese goods. What the US is looking for now is to get China to accept more US business and technology.

Trump is also planning a meeting with Xi soon and says that the two countries “have a very good relationship.” What will be the geopolitical consequences of the deal are difficult to forecast, suffice to say that the US has moved away from a posture that looked like it was going into a new Cold War with China.

India

There is an echo of these developments in the ties between India and the US. The two countries are not military allies but say they are strategic partners that aimed to contain China. Yet, there has been a distinct sense of disappointment in India in relation to the US responses to Pakistan.

While the US properly stood by India and condemned the Pahalgam attack, its attitude towards Operation Sindoor was complicated. Initially it called for a quick resolution of the conflict between India and Pakistan and then called for a de-escalation. Thereafter, much to the discomfiture of New Delhi, it claimed that it brokered the ceasefire between the two parties and was even ready to mediate between the two parties.

Pakistan

Parallel to this, the US was reaching out to Pakistan when its Central Command chief General Michael Kurilla described Islamabad as a “phenomenal partner” in counterterrorism. Field Marshal Asim Munir was invited by President Trump for a lunch in the White House because Trump said that he had played a role in de-escalating tensions with India. Recently, its foreign minister Ishaq Dar was in Washington where after their meeting, the State Department spokesperson noted Secretary of State Marco Rubio’s appreciation for the counter-terrorism cooperation between the two countries.

The American re-hyphenation of India and Pakistan has rattled New Delhi which is in the midst of negotiating a trade deal with the US. In the first Trump term, the Modi government signed two remaining foundational military agreements with the US, the COMCASA and BECA. This may have triggered China’s venture in eastern Ladakh in 2020. Now New Delhi is seeking to repair the ties with Beijing. New Delhi has been active in its participation in plurilateral groupings like the SCO and BRICS and there has been talk about the revival of the Russia-India-China grouping as well.

For over 60 years, US global strategy has been to build a network of military alliance systems cemented with a generous dose of soft-power. The Trump Administration has loosened those foundations. Few tears will be shed for the decline of US global hegemony, but the world needs concerted action and leadership in a range of areas from climate change to peace-making.

Countries like India have long hailed the ideal of multi-polarity, now we stand on its threshold. The challenge is for leading countries of the world to shape combinations that can effectively deal with the challenges which immediately include war in West Asia, Ukraine, Sudan and Southeast Asia. Organisations like the SCO or BRICS, or for that matter ASEAN, EU and SAARC need a complete overhaul, if they are to play a role in stabilising the already dangerously volatile world order minus the US.

Manoj Joshi is a distinguished fellow with the Observer Research Foundation in Delhi.

This piece was first published on The India Cable – a premium newsletter from The Wire & Galileo Ideas – and has been updated and republished here. To subscribe to The India Cable, click here.

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