Is India ready to face the challenges of a Trump 2.0 presidency?

When Narendra Modi walks into the White House this week, he will do so as the leader of the world's fifth-largest economy—soon to be the third. The U.S. sees India as a rising power, and this view is reinforced by a growing relationship between the two nations.

In President Donald Trump's first term, events like the "Howdy Modi" and "Namaste Trump" rallies highlighted the increasingly close ties. But with Trump 2.0, his approach has shifted, embracing a more aggressive, America-first stance that could test the partnership, The Economist argues.

Despite this, both nations still share a common need: countering China. A deadly border clash with China in 2020 strengthened India’s alignment with the U.S. Over the past decade, trade between the two has surged, doubling to nearly $200 billion by 2024. American companies employ millions of people in India, and the Indian-American diaspora has become a powerful economic force in the U.S.

Under Trump, India's geopolitical and economic interests align well with America’s priorities. He has tempered criticisms of India's oil purchases from Russia and avoided pressing human rights concerns. He even signed an executive order suspending enforcement of the Foreign Corrupt Practices Act, benefiting Indian billionaire Gautam Adani, a close Modi ally.

However, tensions persist. Trade remains a contentious issue after Trump revoked India’s preferential trade status and imposed tariffs. The U.S. trade deficit with India has nearly doubled, and Modi has responded by reducing tariffs and increasing purchases of American natural gas. Migration issues also complicate the relationship, with growing concerns over the large Indian diaspora in the U.S. and undocumented workers.

Defence ties are another point of friction. While the Biden administration has supported India’s defence capabilities and manufacturing ambitions, Trump may push India to deepen its security partnership with the U.S., Japan, and Australia. His stance on defence could leave India less room to diversify its sources of military equipment, particularly as India aims to reduce reliance on Russia.

The tech sector is also a battleground. While both nations share common ground on issues like telecom security, India’s ambition to become a major tech player clashes with Trump’s "techno-nationalism." India's push to develop its own digital and semiconductor industries might face resistance from the Trump administration, which wants to prioritize American-made technology.

As India and the U.S. navigate this increasingly complex relationship, both nations face challenges in maintaining their strategic alignment amid political, economic, and technological tensions. The future of this partnership will depend on whether both sides can find common ground amidst competing national interests.

By Vugar Khalilov