Prime Minister Narendra Modi and Donald Trump call each other friends, but analysts say rising trade disputes will test their cordial relations when Trump becomes US President again.
The warm embrace and cordial behavior shared by the two men during their official meetings belies Trump’s occasionally aggressive stance towards New Delhi in his first term, when he termed India a “tariff king” and a “trade abuser”. Was.
Trump promised to impose “reciprocating” tariffs on countries with trade surpluses with the United States, a move that could hit industries in the world’s fifth-largest economy.
“Look at the direction Trump wants to take America … to bring economic and industrial activity back to America,” Indrani Bagchi, chief executive of the Delhi-based Anant Aspen Center think-tank, told AFP.
“For decades, America has held on to the idea that things are produced somewhere else and you get them cheaper,” he said.
“If manufacturing does indeed move back to the US, what does that mean for countries that have trade surpluses with the US?”
India is the ninth largest trading partner of the United States with a trade surplus of more than $30 billion in fiscal year 2023-24.
PM Modi’s government has also sought to promote local manufacturing through its “Make in India” campaign, offering simplified laws and generous tax concessions for new ventures.
The initiative has come to fruition with the growing presence of Apple and other tech giants looking to diversify their supply chains outside China.
And India’s largest technology companies, including TCS and Infosys, have become corporate leviathans by giving their American counterparts the means to outsource their information technology needs to a cheaper labor force.
Ashok Malik of business consultancy The Asia Group told AFP that all could suffer if Trump fails to fulfill his pledge to bring back jobs and launch a “tariff war”.
“Trump’s retaliation for his aggressive trade policy in his first term will primarily focus on China, but India will not be unaffected,” he said.
‘a friend of mine’
PM Modi and Trump praised each other in a joint appearance at a Houston stadium during Trump’s first term in 2019, promising a close, personal alliance in front of thousands of Indian-Americans.
About 50,000 people attended the event, which was considered the largest gathering ever held in the United States for a foreign leader other than the Pope.
PM Modi returned the favor the next year by hosting Trump at a rally in his home state Gujarat, which was attended by an estimated 100,000 people.
“He’s my friend,” Trump said about PM Modi on a podcast hosted by comedian Andrew Schultz last month.
“On the outside he looks like he’s your dad. He’s the best. A total killer.”
Harsh V Pant, a professor at King’s College London, told AFP that India would benefit from the personal warmth shared between the two leaders.
“Modi is definitely the kind of strong leader that Trump likes,” he said.
“Embracing Modi is politically convenient, the optics are good, and there are a lot of positives for Modi to exploit.”
Migration ‘PR disaster’
Yet there is a risk of major diplomatic differences in the coming years that could spoil their mutual harmony.
India is one of the largest sources of legal immigration to the United States, but in recent years thousands of Indians have entered the country illegally by crossing the Canadian and Mexican borders.
Bagchi said this will definitely be a problem when Trump pursues his stated policy of cracking down on illegal immigration.
“We are looking at a PR disaster if Indians are picked up and deported on a large scale,” he said.
India has unveiled several new partnerships with the United States under the Modi government, including in defence, technology and semiconductor production.
The world’s most populous country is also a member of the US-led Quad alliance along with Australia and Japan, which is seen as a means to counter China’s rising power in the Asia-Pacific.
Trump’s “unpredictability” raises doubts about whether this trajectory of closer cooperation will continue, Pant said.
“The fact that he doesn’t see the world in a strategic sense has always had transactionalism embedded in his approach – which complicates it and brings uncertainty.”
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
