India optimistic about Trump presidency, worried about trade, tariffs

by Admin
India optimistic about Trump presidency, worried about trade, tariffs

As India looks ahead to President-elect Donald Trump taking charge in Washington, there is optimism the strategic relationship built by the two countries in recent years will strengthen. India also hopes to benefit if Trump takes a less confrontational approach to Russia, say analysts.

New Delhi also is bracing for turbulence in trade ties, though, which could be affected by Trump’s “America first” agenda.

In his congratulatory message posted on social media platform X, Indian Prime Minister Narendra Modi called Trump “my friend” and said, “I look forward to renewing our collaboration to further strengthen the India-U.S. Comprehensive Global and Strategic Partnership.”

Modi shared photos of the two leaders hugging and Trump’s visit to India during his first term in 2020 — a time when Trump shared warm relations with Modi.

Analysts in New Delhi expect that India will remain a key partner for Washington.

“Compared to most other countries, particularly some of the USA’s closest partners, perhaps India is better placed because of its centrality in the Indo-Pacific and the role it plays in counterbalancing China,” said Harsh Pant, vice president for studies and foreign policy at the Observer Research Foundation in New Delhi.

“Given that Trump had invested in this partnership in his earlier term, there is hope it will continue the same trajectory,” he said.

The Quad group — a partnership among the United States, Japan, Australia and India, which had been dormant earlier — was revived under the previous Trump administration with an eye on China.

However, a sense of uncertainty lingers in the corridors of power in New Delhi. “The relationship may face hiccups, which we cannot anticipate at the moment given Trump’s leadership style and unpredictability,” said Pant.

India also hopes that confrontation between the U.S. and Russia will lessen under the Trump administration. During the campaign, Trump had said he would end the Russia-Ukraine war without elaborating. In the past he has spoken of having a good relationship with Russian President Vladimir Putin.

“If U.S. hostility to Russia lessens under Trump, we believe that it would reduce the extreme and overwhelming Russian dependence on China, which is good from India’s perspective,” according to Sreeram Chaulia, dean at the Jindal School of International Affairs at O.P. Jindal Global University.

Indian sand artist Sudarsan Pattnaik made this sculpture depicting U.S. President-elect Donald Trump after he won the U.S. presidential election, in Puri, India, on Nov. 6, 2024.

Despite a recent thaw in ties with China, India remains wary of Beijing.

Others point out that maintaining India’s time-tested ties with Russia could become easier under a Trump presidency. India refused to join Western sanctions against Russia or condemn the war in Ukraine, positions that became an irritant in Washington.

“Trump appears to have a less strident approach to Russia, and that will help India by making it simpler to balance relations between Washington and Russia,” said Anand Kumar, associate fellow at the Manohar Parrikar Institute for Defense Studies and Analyses in New Delhi.

“Tariff king”

While security ties will likely stay on track, there are worries over whether trade relations will take a hit under Trump, who has said he will follow an “America first” agenda and impose tariffs on countries that have trade surpluses with Washington.

The U.S. is India’s largest trading partner — two-way trade last year totaled almost $120 billion, with a surplus of $30 billion in India’s favor.

During his previous term, Trump called India a “tariff king,” criticized high duties that New Delhi imposed on American products such as Harley-Davidson motorcycles, and terminated India’s designation as a developing nation that had allowed businesses to export hundreds of products duty-free to the United States. India retaliated by raising duties on some American products.

Such tensions could be exacerbated because Trump is likely to push New Delhi to lower import duties for American companies. “This will be a slippery slope for India; he could demand market concessions,” said Chaulia.

Indian officials, however, have sounded an optimistic note.

“There was already a reordering of the supply chains taking place. It is very likely that in view of the [U.S.] election results, this would accelerate. Some of it will be disruptive, but we in India see it as an opportunity,” Indian Foreign Minister Jaishankar Subrahmanyan told business leaders in Australia on Thursday.

He was referring to the trend of companies such as Apple setting up manufacturing bases in India as they looked to diversify production from China.

But analysts say Trump could take a diametrically different approach.

“He has this philosophy of onshoring, that is bringing manufacturing back to the U.S. rather than friendshoring which Biden used to talk about — that is encouraging businesses to move to friendly countries. So, the overall idea that U.S. businesses that are leaving China would think of India as an alternative — that model Trump may not encourage,” said Chaulia.

Defense and technology

There also are questions about how the defense and technology cooperation between India and the U.S. that gained momentum under the Biden administration will move forward. India has pushed for co-production of defense technology rather than relying solely on direct purchases of military equipment; sustaining that under Trump may pose a challenge, according to analysts.

“The U.S. has operated under the assumption that boosting India’s capabilities is in America’s self-interest, especially in balancing China. But Trump is likely to demand some Indian ‘pro’ for American ‘quid,’” analyst C. Raja Mohan wrote in the Indian Express newspaper on Thursday.

“India may find itself on a steep learning curve as it figures out there may be no ‘free lunch’ under Trump’s second term,” Mohan wrote.

Still, as India prepares to navigate a Trump presidency, there is an overall sense of confidence.

“I don’t think India is as worried as some other world capitals. New Delhi understands that if Trump’s obsession with China continues, that gives India greater space to maneuver,” said Pant.

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