President Donald Trump’s return to the White House in January 2025 quickly bore an “America First” imprint – complete with new tariffs and tough bargaining. As one analyst noted, Trump’s administration “pivoted to economic measures – reciprocal tariffs now serve as a powerful tool, with India among [countries] impacted”. Less than a month into his term, Trump hosted Prime Minister Modi in Washington. The summit was staged with smiles and mutual praise, but the underlying reality was unmistakably transactional. As Carnegie analyst C. Raja Mohan observes, Modi “rushed to Washington” in a highly choreographed display of bonhomie to reassure Trump that India is a partner, not a rival, in his “Make America Great Again” agenda.
Bonhomie and Bargains
On the surface the meeting was warm and scripted. Both leaders exchanged praise and poses for cameras. As Carnegie and Indian press reports note, Modi “played his cards right” by lavishly praising Trump’s policies and publicly affirming India’s loyalty, persuading the president to keep U.S.–India policy largely on its prior course. Indeed, the post-summit joint statement was essentially a continuation of the previous administration’s approach, “with slight repackaging,” in the words of expert Ashley Tellis.
But the good optics hid hard bargaining. Officials quietly zeroed in on the key issue – the large U.S. trade deficit with India. The U.S. runs roughly a $45.7 billion goods deficit with India (2024), and Trump’s team demanded tariff cuts to narrow the gap. According to U.S. trade data and analysts, India agreed under a temporary arrangement to boost its purchases of U.S. goods – for example, raising its annual U.S. energy imports from about $15 billion to $25 billion – and to expedite major defense procurements. In return, the U.S. held off on actually slapping the newly imposed 25–27% tariffs in April 2025. In effect, both sides bought time: Delhi has committed to “work on its tariffs” in the coming months, while Washington has agreed to delay punitive duties (aiming to finish negotiations before the next presidential visit to India).
Defense Deals and Strategic Stakes
Beyond trade, the summit heralded an unprecedented surge in military cooperation. Trump told reporters he would boost U.S. arms sales to India by “many billions of dollars” and “pave the way” for sale of F-35 stealth fighters. In fact, the White House joint statement announced plans for new ten-year defense frameworks, expanded co-production projects (such as Javelin anti-tank missiles and Stryker combat vehicles built in India), and continuation of large recent buys of U.S. aircraft and drones. Analysts say these deals are a strategic victory for both sides: India accelerates its military modernization (it expects to spend over $200 billion in the next decade), while the U.S. cements interoperability with a key Asian power. “We’ll be increasing military sales to India by many billions of dollars,” Trump declared, a pledge later echoed in detail by U.S. officials. (India’s government cautiously notes the F-35 sale is only at the “proposal” stage.) The bottom line: the security partnership has never been stronger, underscored by the new U.S.-India COMPACT unveiled at the summit and expanded defense sales.
At the same time, hard geostrategic realities loom. Both sides emphasized the importance of countering China and terrorism, reflecting converging interests in the Quad and other forums. But India’s room to maneuver depends on Washington’s broader foreign policy. As former Indian Ambassador Navtej Sarna warned, “the diplomatic space that India gets to manoeuvre will depend a lot on what happens with [U.S.] relationships [with China, Russia, and others]”. For example, New Delhi must balance its traditional ties to Russia (including energy and defense links) against Washington’s push for a united front on Ukraine and China. Modi’s praise for Trump’s outreach to Putin (and even a jokey endorsement of “MAGA” with an Indian twist) was meant to signal goodwill on this front. How Trump’s “atypical” world view plays out – whether he softens on Russia, doubles down on tariffs, or pivots to new alliances – will ultimately shape what India can gain or concede in this relationship.
Visas, Deportations and the Human Toll
Notably absent from the joint communiqués, but no less contentious, was immigration. Trump 2.0 has revived a hard line on illegal migration. Just days before Modi’s visit, a U.S. military plane landed in India carrying about 100 deported Indian nationals – one of several such flights under Trump. U.S. officials report they have identified roughly 18,000 undocumented Indians in America. In Washington, diplomats pressed for cooperation on stemming illegal entries, while India protested the public spectacle of shackled deportees (arguing the U.S. should have used civilian means). At the same time, migrants and tech professionals are anxious: Indians receive about 70% of U.S. H-1B work visas, and experts predict Trump’s administration will curtail these channels sharply. As Navtej Sarna noted, Trump’s second term will likely see a significant reduction in Indian visa issuance. This looming visa squeeze – in fields from IT to academia – could become a major sore point, even as Delhi strives to keep the diplomatic picture friendly.
Looking Ahead: Three Lingering Tensions
For the moment, Delhi and Washington have managed to put on a friendly face and agree to a framework of deeper cooperation. Yet several unresolved fault lines remain:
- Trade and Tariffs. The interim deal defers a showdown but doesn’t resolve it. India still maintains some of the world’s highest import duties, and U.S. negotiators will press for sharp cuts after Trump’s scheduled India trip. Both sides say they will complete tariff adjustments soon, but the timing and scope are unclear. If India backs off too little, the threatened 2025 tariffs (and even wider 10% baseline duties under Trump’s global tariff order) will return. If India caves too much, domestic industries will protest. The tension between U.S. deficit concerns and India’s protectionist streak remains the first test of this new relationship.
- Immigration and Mobility. Americans demand border security and skill priorities; Indians want fair treatment of workers and diaspora. Deportation flights and family separations have already raised tempers in New Delhi. The future flow of students and tech talent depends on policy choices in the next months. As one former ambassador warns, immigration could become a choke point unless carefully handled. Any sharp U.S. limits on visas or legal migration could undercut the positive narrative of partnership, especially given the deep people-to-people ties (an estimated half a million Indian-Americans and growing business networks).
- Geopolitics and Strategic Posture. Beyond bilateral economics, India’s foreign policy will be constrained by global shifts. A Trump administration skeptical of multilateralism might side-step international issues like climate or human rights, where India might find itself at odds. Meanwhile, Washington’s evolving attitude toward China (and whether it pursues a reset with Moscow) will directly affect India’s leverage. The forthcoming Quad summit and other summits will test how much India can juggle its China ties, its closeness to Russia, and its desire for advanced U.S. technology. In Sarna’s words, India’s “diplomatic space…depends a lot on what happens with [the U.S.] relationships” elsewhere. How both leaders handle these broader dynamics will set the tone for years to come.
In sum, the India–U.S. partnership in 2025 is robust on defence and shared interests, but it rests on a delicate balance of transactions. The handshakes and grand statements of the Washington summit have bought goodwill – but the true challenge now lies behind closed doors. Watch for the outcome of the trade talks, the fate of visas for professionals, and the global power plays (China, Russia, Iran, etc.) that will pull at this bilateral “tightrope”. Navigating these tensions wisely will determine whether the two democracies emerge as stronger partners or simply remain strategic customers of each other.
