Prime minister Narendra Modi’s ambitious equation of “MAGA (Make America Great Again) + MIGA (Make India Great Again) = MEGA” appears to have been upended by recent developments. While Modi envisioned a synergistic partnership between the two nations, president Donald Trump’s recent remarks suggest a different reality – one where India’s aspirations for MIGA may have been sacrificed at the altar of American interests.
On March 7, President Trump triumphantly declared that India had agreed to “cut their tariffs way down now because somebody [the United States] is finally exposing them.”
This statement not only undermines Modi’s vision of MIGA but also raises questions about the balance of power in the ongoing bilateral trade negotiations. Trump’s pronouncement effectively reduces Modi’s equation to a one-sided victory for MAGA, with MIGA seemingly reduced to zero.
While Trump did not specify the extent of the tariff cuts, it is reasonable to infer that India may have conceded to lowering import duties on a wide range of products. These concessions, if true, could have significant implications for India’s domestic industries, particularly its farmers and underdeveloped sectors, which have long relied on high tariffs for protection.
Trump’s jubilant tone suggests that the U.S. is on its way to secure a favourable deal. If these claims hold weight, India may have effectively handed over access to its vast market without securing commensurate benefits in return. Such an arrangement could bind India’s agricultural and industrial interests for years to come, with far-reaching adverse consequences.
Disturbingly, the Indian government’s response has been muted, offering only vague assurances that the bilateral free trade agreement is still a work in progress. However, Trump’s remarks have already dealt a significant blow to India’s negotiating position, leaving many to wonder why New Delhi allowed itself to be humiliated in this manner.
Why the shift?
India has a long history of defending its interests in multilateral and bilateral trade negotiations. From the establishment of the General Agreement on Tariffs and Trade (GATT) in 1948 to the Uruguay Round and the creation of the World Trade Organization (WTO), India has consistently fought to protect its economic sovereignty, even while making occasional compromises.
For instance, India reluctantly accepted the Trade-Related Aspects of Intellectual Property Rights (TRIPS) agreement under pressure from the US. Similarly, it agreed to the Trade Facilitation Agreement without securing ironclad guarantees on public stockholding programs for food security. Despite these concessions, India has continued to advocate for critical issues, such as a permanent solution for public stockholding programmes – a demand the US has consistently blocked.
The recent developments, however, suggest a worrying shift in India’s approach.
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Trump’s disparaging remarks and the lack of a robust response from New Delhi indicate that India could be sidelining its bilateral and multilateral trade agendas to appease the US. This is particularly concerning given that the US has repeatedly violated global trade rules, from its massive farm subsidies to its obstruction of the WTO’s appellate body.
A one-sided deal?
Trump’s rhetoric reflects a “my way or the highway” approach to trade negotiations, one that prioritises American interests at the expense of its partners. By indicating that the US will impose allegedly unilateral reciprocal tariffs and undermining the WTO, the US has consistently flouted the principles of non-discrimination and fair trade enshrined in the Marrakesh Agreement.
India, on the other hand, has largely adhered to these principles, even as it faces pressure to open its markets. The question now is whether India’s concessions are part of a strategic compromise or a sign of capitulation. The timing of commerce minister Piyush Goyal’s visit to the US, coinciding with the imposition of reciprocal tariffs, further raises doubts about India’s negotiating strategy.
India’s sovereignty at stake?
The Modi government’s efforts to accommodate Trump’s demands risk placing India in a precarious position. By appearing to prioritise short-term gains over long-term interests, India risks undermining its economic sovereignty and weakening its standing in global trade negotiations.
Trump’s remarks have exposed a troubling reality: when push comes to shove, India may not stand firm in defending its national interests. This raises the question – why did India allow itself to be humiliated in this manner? The answer may lie in the complex dynamics of global trade, where economic might often dictates terms.
The recent developments serve as a wake-up call for India. While trade negotiations often require compromise, they should not come at the cost of national dignity or long-term economic interests. India must reassess its strategy and ensure that any agreement with the US is balanced, equitable, and in line with its broader economic goals.
As the world watches, India must decide whether it will continue to play second fiddle to American demands or reclaim its position as a confident, assertive player on the global stage. The stakes are high, and the choices made today will shape India’s economic future for decades to come.
Ravi Kanth Devarakonda is a financial journalist based in Switzerland.