If his behaviour, public statements and social media outbursts are any indication, US President Donald Trump is much more extractive of India in his second term, and relations between the two countries appear to be at their worst. Traditional diplomatic rhetoric and public niceties seem a distant memory with Trump's second coming. Yet, Trump still seems to want to tackle the trade deficit with India. Defence exports to India can be a central component in rectifying that trade deficit - a prospect he is in danger of jeopardising. The Trump administration's second act in the Oval Office may be the beginning of a new chapter of India-US ties.
Friend To Foe
Traditionally, despite ups and downs, the US has viewed India as a potential partner in Asia. The United States was the second-largest defence supplier to India. Today, that partnership is in the worst state it has ever been in. Earlier this year, Trump claimed that the US was ‘paving the way' to provide India with the F-35, and a joint statement released by both countries seemed to indicate that a deal was imminent as well. India is also prioritising modernising its military, and the deal, had it materialised, would have been a large step forward in upgrading India's airpower. However, with each 25% dose of tariffs that the US has administered to India within the last few days, India's unwillingness to purchase a fleet of stealth fighters seems to be increasing. In a response to a question in the Lok Sabha, the minister of state claimed that ‘no formal discussions' regarding the purchase of the stealth fighters had been made yet. If these tariffs were not enough to severely impact the strategic relationship, the US administration's concurrent overtures towards Pakistan add a layer of strategic insult to economic injury.
Embracing China And Pak
Theories on statecraft and power are barely enough to explain some of the messaging President Trump has been engaging in. He seems to prioritise economic gains over everything, including peace and partnerships. He himself and the White House, on separate occasions, have claimed credit for resolving the recent conflict between India and Pakistan - something that the Indian government has outright denied. Pakistan supported these claims, and, not so coincidentally, the recent revision finally set the reciprocal tariff rate with Pakistan at 19%.
On the other hand, India now faces 50% tariffs. A new deal for the joint development of Pakistani oil reserves, which was publicly commemorated by both Shehbaz Sharif and Trump, coincides with the imposition of tariffs on India. For India, all this speaks of Pakistan's growing proximity with the United States at a time when Indian leaders have expressed displeasure with Trump's attitude towards India.
A Perplexing Attitude
While US protectionism is not new, this level of tariff increases is unprecedented. Trump has made remarks on India relying on military equipment from Russia, which, in his opinion, is “not good”. These seem like efforts to impose costs on India for its reliance on Russia and force it to look towards the United States. However, on the other hand, some of his remarks seem to go beyond merely trying to coerce India into trading with the US. Over the last few days, the POTUS has called Indian trade policies “strenuous and obnoxious” and has referred to India and Russia as “dead economies”. While the present Indian administration and Indian opposition leaders find little common ground, actors across the spectrum of Indian politics have made statements that indicate that they feel belittled and insulted by Trump's colourful diplomatic lexicon.
The next and potentially final nail in the coffin is the Trump administration's apparent softening towards China, which serves as another sore point for Indo-US ties. On the China front, in late July, the US and China paused the escalation of tariffs for 90 days, a bid to prevent a trade war. Moreover, Trump has taken an uncharacteristically diplomatic tone and said the US would be “very nice with China”. In June, the US also cemented a deal that restored its access to rare earths, bringing a temporary fix to major supply chain disruptions that were caused by Chinese restrictions. While these measures may be temporary given the volatility of American policies currently, for India, Trump's relatively diplomatic and cautious approach to China can be interpreted as a tacit thaw in tensions between the two countries, something that was previously a shared interest between India and the United States.
Unreliable Partner
The tariffs, coupled with the US' proximity to Pakistan, create a trust deficit. Supplier reliability is of paramount importance when purchasing long-term assets, say, fighter jets. A partner capable of imposing such stringent economic measures would create uncertainty about the ready supply of spare parts, software upgrades, and maintenance support for platforms with a multi-decade lifespan. This concern goes beyond merely the question of F-35 fighters and casts a shadow over the entire defence trade ecosystem between India and the United States.
There is an apparent contradiction between the US's expressed interest in increasing defence exports to India on one hand, and its punitive tariffs and warming relations with China and Pakistan on the other, especially at a time when India's own neighbourly ties are far from normal. Today, the United States is India's third-largest defence supplier after Russia and France, having fallen from second place in the early 2000s. This inconsistency will likely further push India to consider other suppliers when shopping for military hardware. Although other inherent issues for India come with relying on European countries or Israel for defence procurement, given the current volatility of Trump's dealings with India, India may benefit from looking elsewhere.
(The author is with Takshashila Institution)
Disclaimer: These are the personal opinions of the author
