On 7th August 2025, Trump announced additional 25% tariffs on India, subjecting the latter to 50% tariffs in total. There remains a 20-day negotiations window in place before the additional tariffs are imposed. Prior to this announcement, India`s Ministry of External Affairs (MEA), in a stern remark, termed the threat of tariffs as “unjustified and unreasonable”. The MEA also criticised the European Union and the US for their double standards, as they themselves import from Russia.
But Trump`s recent remarks on the suspension of trade talks until the tariffs issue remains unresolved have put the India-U.S. bilateral ties in disarray. Notably, China is currently being levied with just 30% tariffs, making India face the highest tariffs, if imposed, along with Brazil. The unease among policymakers in New Delhi has increased as they believe India is being pushed into a geopolitical tug of war between the US and Russia over the Ukraine conflict. Trump had criticised India for its energy imports from Moscow.
The U.S. tariffs, Trump`s unrepentant criticism of India and a congenial Washington-Islamabad relationship, following Pakistan`s Field Marshal Asim Munir’s visit to the U.S., have most certainly affected the India-U.S. ties. India now needs to focus more on multilateralism and distance itself momentarily from the US. Multilateralism may help India to hedge and buy time before the uncertainty dissipates in India-US bilateral ties.
Hedging and Bading Time
Philippine President Ferdinand Romualdez Marcos Jr was on a 5-day visit to India when the U.S. tariffs were announced. The two countries signed a Strategic Partnership Agreement to upgrade ties with Indian PM Modi`s declared support for Freedom of Navigation and the Philippines’ stance on the South China Sea vis-à-vis China. Manila has also become the first export destination for India`s BrahMos Missile. As the Philippines will hold the ASEAN chair in 2026, mending ties with Manila is vital for India, which could possibly lead to the signing of the Preferential Trade Agreement (PTA).
To intensify trade negotiations to help tackle the adverse impact of US tariffs, New Delhi is hosting the 10th India-ASEAN Trade in Goods Agreement (AITIGA) from 11th August onwards. The growing trade deficit of $45.2 billion between 2024-2025 remains a cause of concern for New Delhi, which will be negotiated during the AITIGA meeting. This comes after PM Modi met the Malaysian PM Anwar Ibrahim in July, who currently holds the ASEAN Chair. Moreover, India is likely to participate in the ASEAN-India summit and the East Asia Summit scheduled to be held in October.
Additionally, PM Modi is expected to visit China for the Shanghai Cooperation Organisation (SCO) summit at the end of August, in the likely presence of Russian President Vladimir Putin. Moscow is hoping for a resurrection of the Russia-India-China (RIC) trilateral grouping that would not only assist in negating its international isolation but also sustain its economy. Russia`s Foreign Minister Lavrov had previously, in June, voiced support for RIC. Beijing indicated similar support. Unlike the past when India remained non-committal to RIC, it has now signalled a tentative openness to discussing the initiative.
Furthermore, the RIC could aid progress in BRICS. Member countries of BRICS are undergoing a decline in their bilateral ties with the US. Trump has persistently alleged that BRICS of attempting to replace the US dollar with an alternative global economic order. A united and coordinated response by BRICS is underway, as highlighted by PM Modi`s calls with Brazilian and Russian Presidents. India`s National Security Advisor (NSA) Ajit Doval also visited Moscow on 7th August, and there remains a possibility of President Putin`s visit to India soon. Many also believe that Chinese media, especially Global Times, has softened its stance towards New Delhi. China`s ambassador to India, Xu Feihon, also posted on X in support of India. Therefore, despite the challenges, geopolitical uncertainties have led to a resetting of ties between India and China, with Russia assisting as a mediator between the two.
Future of India-US ties?
The departure of Trump from the American political landscape by 2027 may help to resurrect the India-US bilateral ties. Heralding ties with Washington, many in India hope that successive US leaderships can help resolve tensions with India. However, this may not be easy. In democracies, domestic public opinion guides political opinion. Similarly, political opposition in India has exerted pressure on the Modi government to seek alternative trade partners. PM Modi himself had stated that “he is ready to pay a very heavy price”. New Delhi is defiant about importing American genetically modified (GM) crops and duty-free imports of US farm and dairy products, a long-standing demand of Trump for trade to move forward.
Apart from trade, India is becoming increasingly cautious about the growing bonhomie between the US and Pakistan. Asim Munir proclaimed a nuclear veiled threat to India during his 2nd visit to Washington, ever since being designated Field Marshal. Trump`s insistence on having brokered a ceasefire between India and Pakistan on May 10th has also not been received well by New Delhi. While many in the US have criticised Trump for debasing ties with India, Trump seems to be unrelenting in weaning off India`s strategic autonomy and the latter`s relations with Russia.
Trump is scheduled to meet both the Russian and Ukrainian Presidents to mediate a ceasefire in the Ukraine conflict, possibly in the UAE in August. Policymakers in India will view these meetings with utmost precision, as they might have the ability to improve US-India ties if a ceasefire is agreed upon. Amid such uncertainty, India is set to host the QUAD Summit in 2025, though the date is yet to be finalised. Foreign Ministers of QUAD countries met in June to discuss the agenda for the summit. The summit may not make any progress beyond paper, owing to the disillusionment of all its members with the US.
Yet, despite Trump`s constant intimidation, India remains hopeful of a possible reset in ties with the US. However, what may have changed this time is that India could be unwilling to let go of multilateralism to reorganise its relations with the US. Hence, this could be an additional irritant to the subsequent US administrations, but something they may tolerate if India continues with its balancing act altogether.
Leave a Reply