What Does the Experience of the Past Year Tell us About the Direction of India-US Ties?

The benchmarks in the estrangement of the two countries are well known – it began with Operation Sindoor, intensified when punitive tariffs were imposed on India’s import of Russian oil and was marked by India’s participation in the Tianjin Shanghai Cooperation Organisation (SCO) summit, the prolonged trade deal negotiations, aggressive US deportation of Indian immigrants and the increase of H-1B visa fees, weakened cooperation in the Quad and the softer US approach to Pakistan and China.

In the interim, India had fast-tracked free trade agreements with other partners, including, importantly, the European Union. But there are some who believe that the interim trade deal reducing tariffs to 18% following Indian commitments to stop Russian oil imports will lead to the normalisation of a situation that had profoundly weakened Indian trust in the US as a reliable partner.

But this may well be a false dawn. The texture of the India-US conversation on what is still merely “a framework for an Interim Agreement” for reciprocal trade, is not heartening. The hiccups that were heard – the controversy over the revealing White House fact sheet on the trade deal – are an example. More than anything, what it has done is to reveal the lines along which the US will push in the coming period when the actual agreement is negotiated.

It will definitely press for the inclusion of “certain pulses” to the list of agricultural products it wants to export to India. It will demand that India remove the digital services tax that affects its major companies. And its lever will be the Indian “commitment” or perhaps “intention” to raise the purchase of American products by $500 billion in five years.

All this will be done with the Russian oil gun to India’s head. The US has not hesitated to spell out bluntly that should India not stop purchasing oil from Russia, New Delhi could once again be hit by punitive tariffs.

An example of the tough US approach is evident from the recent US-Bangladesh arrangement wherein the US reduced the latter’s reciprocal tariffs to 19% but has said it would accept their textile products at zero tariffs if Bangladesh purchases US cotton and yarn. Bangladesh has been one of the largest importers of Indian cotton, but now it is likely to buy American. In 2024, India had exported cotton yarn worth $1.6 billion to the country. Piyush Goyal says that India can avail the same facility, but then who will buy Indian-produced cotton yarn and human-made fibre?

What we are witnessing is a fundamental shift in the American geopolitical approach to India. Primarily it means that the era of what Ashley Tellis termed “strategic altruism” is over. For the past 25 years, India has played a certain role in the US strategy of being seen as a balancer to a rising China in the Indo-Pacific. Presidents like Bush, Obama and Biden understood that India may not play a major role in the western Pacific, but it could be an asset as a partner in the Indian Ocean Region. At the same time, they were not too concerned over India’s membership in the SCO and BRICS. Their fundamental approach, in any case, was that US power was based on the notion of coalitions and partnerships that spanned the globe and that comprised countries large and small, strong and weak.

The India-US “partnership” was allowed to work at its own pace. For that reason, India took some 20 years to sign the four foundational agreements that eased India-US military cooperation. The technology development initiatives, too, moved in slow motion, from the 2012 Defence Trade and Technology Initiative to the 2022 Initiative on Critical and Emerging Technologies, which have not yet yielded anything particularly significant. But all this may have given New Delhi a somewhat exaggerated notion of its standing in American calculations.

But the Trump administration had different ideas. Already, it is apparent that the US is not all that engaged with the Quad. While a summit in New Delhi, with his presence, had been planned for 2025, it remains to be seen whether it does take place this year. Meanwhile Trump’s treatment of his allies like Canada, South Korea and Australia has left a bad taste in the mouth. On a whim he raised tariffs on South Korea from 15% to 25% because he was not happy that South Korean legislators had been slow to approve the deal the two countries had worked out. As for Australia, there is no news of the reappraisal of the AUKUS deal initiated last June.

India has been an enthusiastic supporter of the Quad’s somewhat dilettante approach to countering China through maritime security, infrastructural development, critical technology and health security. And while it has some security initiatives in the south-east, it has shied away from the substantive role of economically engaging with the region through the Regional Comprehensive Economic Partnership.

In Trump’s eyes, the world is to be seen through the lens of spheres of influence. While the US retains its hegemonic role globally, it intends to concentrate on the Western Hemisphere for the present. The American president may take a tough competitive approach towards Russia and China, but his approach to them has been contradictory. Indeed, he has been more than accommodating to the Russians with regard to the Ukraine war.

His approach to China has been more complex. He was the one who shifted US policy towards China from “engagement” to strategic competition. Accompanying this was a technology restriction regime targeting Chinese companies.

In his second term, he has gone along with that strategy which had been considerably strengthened by the Biden administration. But he has also learnt that the Chinese have the capacity to play him tariff for tariff, so he has hesitated to use the tariff weapon against Chinese oil imports from Russia, unlike the case for India.

Till now, the Trump administration has not quite spelt out its China policy and the two countries have a truce in relation to tariffs. This year, the leaders of the two countries will visit each other and could well work out a modus vivendi that actually enhances the US-China engagement.

In the Trump scheme of things where the US is clearly the dominant global power, it does not need what he says are “free-loading allies” to counter China. In this category he no doubt puts India as well, considering that it is New Delhi that probably needs the US more to counter Chinese geopolitical pressure on its border and in the South Asian region.

In 2021, days before demitting office, the first Trump administration declassified portions of its Indo-Pacific strategy. The US was blunt – its goal was to maintain its strategic primacy (hegemony) in the region. Among the various assumptions it made was that a strong India would “act as a counterbalance to China”. To that end it sought to “accelerate India’s rise and capacity and serve as a net provider of security”.

But the tone of the second Trump administration has shifted. All the National Security Strategy says is that “we must continue to improve commercial (and other) relations with India to encourage New Delhi to contribute to Indo-Pacific security” through the Quad mechanism.

The Trump world sees the gap between India’s strategic intentions and material capability

As for the National Defence Strategy released earlier this year, there is no reference to India at all. The American focus in Asia is in deterring China by strengthening the posture of the US and its allies along the First Island Chain facing China and there Japan, South Korea and Australia (by implication) figure.

With its transactional approach, the Trump world sees the gap between India’s strategic intentions and material capability and wonders whether New Delhi has anything to offer the US besides some trade and a potential market.

As we look forward to the evolving India-US relationship we need to take into account wider developments.

Speaking at the inaugural of the Munich Security Conference, German Chancellor Friedrich Merz declared that a “rules-based world order” no longer exists. He also acknowledged that a deep divide had opened up between Europe and the US. As he prepared to travel for the conference, US secretary of state Marco Rubio complemented this view when he said that “we live in a new era of geopolitics” and that the world had changed. Clearly, India is not a priority defence partner in the American Indo-Pacific military strategy.

At the Conference, beyond adopting a more conciliatory tone towards Europe, Rubio’s remarks also revealed the roots of the current American grand strategy, which is an unapologetic embrace of ‘Christian civilisation’. This is the entity that has, in the past, ravaged the Global South. To the visible regret of Trump, modern-day Europe no longer seems to avow that past. But for us what matters is that the US does.

The Europeans are saying that the old world order is gone, the Americans are saying that the world has changed. The Japanese and the Koreans are saying this, perhaps more elliptically.

But in New Delhi there seems to be a strange nostalgia for the America-leaning “strategic autonomy” that we have avowed for the past two decades. The experience of the past year suggests that India has not been immune to the shift initiated by the US. Indo-US ties are moving from strategic partnership to transactional engagement, which is marked by diminished trust, economic coercion and a clearly reduced American expectation that India will play a major role in the Indo-Pacific. New Delhi needs to navigate this era with its eyes wide open.

The writer 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 – and has been updated and republished here. To subscribe to The India Cable, click here.

The Wire is now on WhatsApp. Follow our channel for sharp analysis and opinions on the latest developments.