Shadow over India-US ties

Hindustan Times

5 days ago

US President Donald Trump's outburst against India on social media in recent days, coupled with the announcement of a 25% tariff on all imports from India, is extraordinary in more ways than one, apart from being factually incorrect. The Indian economy is far from 'dead', as Trump described it in a social media post while railing against India's trade with Russia. India is the world's fastest-growing major economy and will become its fourth largest this year. Trump himself was quite bullish on economic cooperation and a trade deal with India, if the joint statement released after Prime Minister Narendra Modi's visit to the US in February this year is any indication. 'The leaders resolved to expand trade and investment to make their citizens more prosperous, nations stronger, economies more innovative, and supply chains more resilient. They resolved to deepen the US-India trade relationship to promote growth that ensures fairness, national security and job creation', it said while setting a goal of taking bilateral trade between India and the US to $500 billion by 2030. This is not the language countries or leaders use while dealing with 'dead' economies. What Trump has sought to do, in effect, is insist that the US should have a say in determining India's strategic choices, even after New Delhi has made it clear that it would prefer to maintain strategic autonomy based on national interests. (REUTERS)
Indian exports will undoubtedly suffer once the US raises tariff barriers, but that threat is unlikely to force New Delhi to play Washington's game in crucial sectors such as agriculture and dairy, which India has safeguarded in recent trade deals, because there will be severe domestic consequences if these areas are opened up in the way Trump wants them to be. As commerce minister Piyush Goyal has said, New Delhi will have to safeguard its vital national interests, which include sourcing energy and military equipment from Russia, with which it has a legacy relationship. What Trump has sought to do, in effect, is insist that the US should have a say in determining India's strategic choices, even after New Delhi has made it clear that it would prefer to maintain strategic autonomy based on national interests.
Trump also cut deals with the European Union, China, Japan and South Korea ahead of his self-imposed August 1 deadline for reciprocal tariffs, all involving pledges of billions of dollars in investments. There was even a deal with Pakistan, which Trump described just seven years ago as a 'safe haven' for terrorists that has given the US 'nothing but lies and deceit'. On Friday, the Pakistan government got a tariff rate of 19%, down from the original 29%. Trump's taunt about developing Pakistan's energy reserves to sell oil to India, coming on the back of his near-daily claims about ending hostilities between India and Pakistan in May, will hardly endear him to anyone in New Delhi.
Sure, contradictions in the India-US relationship have not come to the fore for the first time. Since the turnaround in bilateral relations following India's nuclear tests in 1998, the two sides have learnt to manage their differences while enhancing areas of convergence. What is different this time is Trump's blunt and offensive communication strategy, where 'a friend' is being openly berated and insulted in the public space. New Delhi has so far not responded sharply, and Trump may only be using tariffs to build pressure — talks for a trade deal are continuing — and the US president has successfully deployed this strategy to have his way with multiple countries, including once-close allies such as Canada. But such whimsical and erratic decision-making has the potential to influence perceptions and impact bilateral ties that both countries have invested much in since the 2000s. The leadership on both sides needs to guard against such a turn of events.