Indian Prime Minister Narendra Modi’s visit to Washington marked a new phase in US-India relations. The discussions focused on trade, defense, and technology, with both leaders reaffirming their commitment to strengthening ties. Here are the five major takeaways from the visit.
Trade and Reciprocal Tariffs
Trade tensions remained a key concern during Modi’s visit. President Trump has pushed for reciprocal tariffs on trading partners, demanding equal import duties. India, which has a trade surplus with the US, had already lowered its average tariffs to ease potential tensions. Experts remain divided on whether India has dodged immediate tariff hikes. While some believe India’s lower import duties protect it, others warn that Trump’s strategy could include additional factors like VAT and government regulations.
Ajay Srivastava, a trade expert, noted that most US exports to India already face low tariffs. However, Abhijit Das, a former WTO negotiator, warned that the US might pressure India to open its government procurement market. This could weaken India’s ‘Make in India’ policy by limiting domestic industry protections. India may counter US demands by highlighting American agricultural subsidies and restrictive non-tariff barriers that impact Indian exports.
Doubling Trade to $500 Billion
Both leaders set an ambitious goal to double US-India trade to $500 billion by 2030. The first phase of a trade deal is expected by autumn 2025. The focus will be on tariff reductions, market access, and supply chain integration. Analysts remain cautious about the specifics of this agreement. It is unclear if this will be a full free trade agreement or a more limited tariff reduction deal.
Economic analyst Priyanka Kishore called the target ambitious but noted immediate opportunities. With upcoming US sanctions on Russian oil, India could turn to the US for more energy imports. Trump also expressed hope that the US would soon become India’s top supplier of oil and gas.
Expanding US-India Defense Cooperation
Defense ties were a major highlight of the visit. The US committed to increasing military sales to India, including a possible deal for F-35 stealth fighter jets. India’s defense imports from the US have surged in recent years, reducing its reliance on Russian weapons. However, experts remain skeptical about India’s willingness to acquire the F-35 due to its high maintenance costs.
Defense expert Ajai Shukla noted that while India is expanding defense ties with the US, American arms deals often come with complex conditions. US private defense firms prioritize profits over long-term partnerships, which could impact future deals. Despite these concerns, India is likely to continue increasing its defense cooperation with Washington due to delays in Russian arms deliveries.
Modi Meets Musk: Uncertainty Over Tesla and Starlink
Modi met with Tesla CEO Elon Musk to discuss artificial intelligence and emerging technologies. However, key issues regarding Tesla and Starlink’s entry into India remain unresolved. Musk has sought direct spectrum allocation for Starlink, clashing with India’s regulatory preferences. The Indian government is also encouraging Tesla to set up a local manufacturing plant, offering tax incentives to companies committing to long-term production. Tesla has not yet confirmed its India plans.
Modi’s Rare Press Conference Appearance
In a rare move, Modi took part in a press conference alongside Trump. He answered questions on illegal immigration and fraud charges against the Adani Group. Modi confirmed that India would take back verified illegal migrants but did not discuss the Adani case with Trump. This marked only the third time in his tenure that Modi answered direct press questions, reinforcing his preference for controlled media interactions.
Modi’s Washington visit focused on solidifying economic and defense ties while avoiding major controversies. The outcomes signal continuity in US-India collaboration, though challenges remain. Trade negotiations, defense procurement complexities, and regulatory hurdles will test the future of this partnership.
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