Why India would need to tread carefully when dealing with the Trump administration

ON JANUARY 25, U.S. secretary of state Marco Rubio said his country’s partnership with India continues to reach new heights and will be a defining relationship of the 21st century. “We look forward to deepening cooperation, including by advancing joint efforts in space research and coordination within the Quad (a diplomatic partnership between India, U.S., Australia and Japan) to promote a free, open and prosperous Indo-Pacific region,” he said.

Republic Day greetings from nations are routine. But this one was special. Five days ago, new U.S. President Donald Trump had, in his inaugural speech, re-asserted his “America First Trade Policy,” which entails a review of all trade agreements. On January 24, the White House claimed executive orders signed by the President within the first 100 hours of taking charge have unleashed American prosperity. Over $1 trillion new investment commitments have been secured, it said. It meant the “historic action to kick off America’s golden age” has begun. What needs to be seen is the impact on other nations, including India.

In a recent discussion on Trump 2.0 in New Delhi, former foreign secretary Shyam Saran said if there is any notion that whatever Trump has done is rhetorical and things will come back to some normal trend, it should be junked. “The agenda Trump set out during his campaign, he is determined to take it further,” he said.

Trump’s major complaint against India has been imbalance in goods trade. During his first term, he had withdrawn some tariff concessions and imposed additional tariffs on some items. This time also, he is clear that India needs to import more U.S. goods. However, India need not worry much, said Saran. “We dealt with Trump in his first term. I see no reason we cannot continue to do so. In the U.S., there is a massive increase in capacity to produce oil, and we need oil and gas. So, one way of deflecting sanctions could be buying much more oil and gas from the U.S. More LNG terminals are going to be set up now than under (Joe) Biden, and if that is the case, there will be a jump in exports. Oil prices will probably fall, which is again good for us,” said Saran.

If tariffs are not an immediate concern, what else should India look at? Once again, U.S. Foreign Secretary Rubio’s first official programme — a meeting with Indo-Pacific Quad foreign ministers — can provide a clue. The joint statement by the four ministers said they are committed to strengthening regional maritime, economic and technology security in the face of increasing threats, as well as promoting reliable and resilient supply chains. “We look forward to advancing the work of the Quad and meet on a regular basis as we prepare for the next Quad Leaders’ Summit hosted by India,” the statement said.

India’s policy should aim at preserving critical outcomes of the relationship, says Meera Shankar, India’s former ambassador to the U.S. “Our major interest should be in preserving access to technologies and working together in frontier areas of technology, apart from the defence technology cooperation programme,” she says.

Finally, with India opening its space sector for private investment last year, Rubio’s Republic Day wish to have more joint programmes in space research can also be a win-win for India and the U.S. in Trump’s second term in office.