A stark contrast is emerging between two visions of a “golden age.” On one hand, there is the “golden age” championed by US president Donald Trump in his address to the US Congress, and on the other, the “amritkaal (golden era)” repeatedly invoked by Indian prime minister Narendra Modi since India’s 75th Independence Day celebrations in 2021. These competing visions now loom large over Washington and New Delhi, shaping their respective trajectories.
Trump’s golden age is rooted in an unapologetic nationalist pursuit of American supremacy, leveraging its market and military power on an imperialistic scale. His agenda revolves around reviving US industrialisation, imposing unilateral tariffs, and striking trade deals that prioritise American interests at any cost.
In contrast, Modi’s Amritkaal appears increasingly fragile, with recent economic slowdown, including the sharp decline in stock market indices and other socio-economic metrics – painting a grim picture.
While Trump’s vision seeks to dominate global trade and secure critical resources like rare earth materials essential for AI and advanced military technologies, Modi’s Amritkaal seems to falter on the global stage. India finds itself sidelined in major geopolitical negotiations involving the US, China and Russia, raising questions about its strategic autonomy.
India at a crossroads
India’s aspiration to reclaim a golden era appears to be leading to compromises with the world’s largest economy – compromises that even the last Mughal emperor might have balked at in dealings with the East India Company.
Historically, India has stood firm against bullying in bilateral and multilateral trade negotiations. However, recent overtures to US trade officials, seeking leniency in reciprocal treatment for Indian exports and imports, suggest a troubling shift in posture.
The concept of reciprocal tariffs, which measures the lack of reciprocity between the US and its trading partners, feels like a throwback to the era of barter trade. This approach undermines the principles of fairness and equity that underpin global trade.
Worse, India seems to have abandoned the principle of Less-Than-Full-Reciprocity (LTFR), a framework it had championed alongside Brazil, South Africa, and China in 2004.
LTFR was designed to address structural imbalances between developed and developing nations, particularly in agricultural trade. By aligning with Trump’s demands for reciprocity, India risks reversing decades of progress in advocating for equitable trade practices.
A strategic misstep?
Unlike China, Canada, Mexico, and the European Union, India appears poised to acquiesce to the Trump administration’s aggressive market access demands. This not only undermines India’s negotiating position but also violates core principles of global trade, such as the most-favored-nation principle and the sanctity of binding scheduled tariff commitments.
China, by contrast, has adopted a two-pronged strategy: imposing retaliatory tariffs while challenging U.S. measures at the World Trade Organization (WTO).
India’s willingness to embrace transactional diplomacy in a “survival-of-the-fittest” scenario risks tarnishing its image as a champion of the Global South. Instead of building coalitions with other developing nations to counter US unilateralism, India’s approach signals a troubling departure from its historical stance.
The WTO crisis and India’s dilemma
Compounding India’s challenges is the Trump administration’s assault on the WTO’s special and differential treatment (S&DT) for developing countries. The US has accused the WTO of systemic failures, citing its inability to address disparities, enforce rules, and deliver meaningful outcomes.
In a 207-page report, the US Trade Representative criticised the WTO’s development agenda, implicitly targeting India and other self-declared developing nations for allegedly obstructing progress.
This critique, however, overlooks the US’s own role in undermining the WTO. Since 2008, Washington has consistently weakened the organisation’s negotiating and enforcement functions, contributing to its current paralysis. The US has also failed to uphold its treaty obligations, particularly under the Enabling Clause of the Tokyo Round, which enshrined S&DT as a cornerstone of global trade equity.
A double whammy for India
India faces a dual crisis: the immediate threat of reciprocal tariffs and the broader challenge of defending its developing country status at the WTO. The US’s push to deny S&DT to nations like India threatens to erode the very foundations of fair trade, disproportionately impacting developing economies.
The Trump administration’s latest trade strategy that would adopted at the WTO could extinguish the demands for “policy space” by developing countries. Further, Washington wants to secure outcomes on what are called plurilateral agreements (agreements involving a group of countries) at the WTO. The current WTO’s Director-General is also a champion of these plurilateral agreements which are being demanded without any respect to rules in a rules-based organization.
India had consistently opposed the plurilaterals on digital trade and investment facilitation for development at the WTO on procedural as well as systemic grounds until now. However, under pressure from the Trump administration, India could say good bye to its principled positions.
India has single-handedly opposed the Fish-2 agreement to address subsidies contributing to overcapacity and overfishing. Even though the agreement remains biased towards the big subsidisers – China, the European Union, the US, Japan, Korea, and Taipei – among others, it sought to reduce the policy space for developing countries like India that did not contribution to the depletion of global fish stocks, nor to the OC&OF subsidies. If the Trump insists on concluding this seemingly rigged agreement, then, India would find itself in a quandary.
Amritkaal or quagmire?
Prime minister Modi’s vision of Amritkaal, once a rallying cry for India’s resurgence based on extreme Hindutva rightwing ideologies, now risks being overshadowed by a whirlpool of trade crises.
As India navigates the complexities of US unilateralism and a fractured global trade system, it must reclaim its role as a leader of the Global South. This requires not only standing firm against unfair trade practices but also revitalizing coalitions with like-minded nations to uphold the principles of equity and justice in global trade.
The road ahead is fraught with challenges, but India’s ability to chart a course that balances pragmatism with principle will determine whether Amritkaal remains a beacon of hope or fades into a mirage.
Ravi Kanth Devarakonda is a financial journalist based in Switzerland.
