Everyone’s eyes were fixed on one question: when would a free trade agreement between the United States and India happen, and what form would it take?
Most people believed that India would be forced to bend. But those who understand Indian Prime Minister Narendra Modi’s temperament and grasp his style of diplomacy were confident that India might show flexibility—but it would not surrender. And that is exactly what happened. India played such a masterstroke that the United States was compelled, in time, to move toward a free trade agreement.
Just last month, in this very column, I had written about whether America’s new ambassador to India, Sergio Gor, would be able to bring warmth to bilateral relations. Sergio Gor is considered close to the Trump family and a powerful figure within the Trump administration. Now, it would not be an exaggeration to say that he has begun the process of sweetening relations. Along with the announcement of the free trade agreement, the Trump administration has brought India under an 18 percent tariff bracket. Earlier, India was facing a 25 percent tariff, plus an additional 25 percent penalty for purchasing oil from Russia—meaning a total tariff burden of 50 percent, the highest imposed on any country. Now, an 18 percent tariff is certainly better than Pakistan (19 percent), Bangladesh and Vietnam (20 percent), and China (34 percent).
The detailed framework of the agreement is yet to be revealed, but even before the deal was signed, Donald Trump made several announcements: that India would no longer buy oil from Russia, that it would conduct $500 billion worth of trade with the U.S., and that American dairy and agricultural products would gain access to the Indian market. These statements naturally triggered concerns. However, the Indian government made it clear that India’s position on agriculture and dairy is non-negotiable. Interestingly, Prime Minister Modi expressed happiness over the agreement, calling Trump his friend—but maintained silence on Trump’s specific claims.
Modi used silence as a powerful strategic weapon throughout this episode. He never spoke against Trump. You may recall that on February 13–14 last year, Modi visited the United States, where trade talks were held but failed to reach a conclusion. On April 2, Trump imposed a 10 percent tariff on nearly 100 countries, including India, warning that it could be raised to 26 percent. Many countries succumbed to American pressure and struck deals—but India remained silent. On July 31, Trump raised the tariff to 25 percent. On August 7, an additional 25 percent penalty was imposed, taking the total to 50 percent. Yet India did not criticize Trump—while making it clear that no agreement would be signed under tariff pressure.
Meanwhile, Team Modi did something Trump hadn’t anticipated. New markets were actively sought for Indian products.
India signed free trade agreements with the United Kingdom, Oman, and New Zealand—which was expected. But when India finalized a free trade agreement with the European Union, alarm bells rang in Washington. The EU has 27 member countries, 25 of which use the euro. This deal was described as the “mother of all deals.” It shook the U.S., because negotiations over this agreement had been ongoing for nearly 20 years. Trump’s attempts to intimidate both the EU and India only pushed them closer, accelerating the deal.
Earlier, by sharing the global मंच with Chinese President Xi Jinping and Russian President Vladimir Putin, Modi had already sent a clear message: India will move forward on its own terms. It will not sit in anyone’s lap. When Trump invited Modi to the U.S. for a meeting, Modi declined—because Pakistan’s Army Chief, General Asim Munir, was also scheduled to visit at the same time. All these events conveyed one unmistakable message to America: India cannot be intimidated or coerced. There was also growing concern in Washington that India’s vast market might slip out of its hands. Sergio Gor must certainly have conveyed this reality. Despite all the bitterness, India kept the door for dialogue open.
Narendra Modi entrusted the responsibility to Commerce and Industry Minister Piyush Goyal. Like Chanakya, Goyal crafted trade deals with Arab nations, the European Union, and Russia—agreements that history will remember. Business acumen is embedded in Piyush Goyal’s DNA, making Modi’s choice of man for the job absolutely right. Naturally, External Affairs Minister S. Jaishankar also played a crucial role.
However, one important question remains: how difficult will it be to erase the line of mistrust that has emerged between the two countries due to recent tensions? Even the American media acknowledges that after decades of effort, relations between the two nations had finally warmed—and that significant damage has now been done. To regain India’s trust, the United States will have to work very hard—and that assessment is correct.
India has always sought good relations with everyone. The strongest proof of this is our decades-long friendship with Russia. If Trump or anyone else expects India to sever ties with Russia, how is that even possible? Russia is like a brother to us. India believes in a multipolar world, and that philosophy is our greatest strength. Let us hope that the line of mistrust fades soon.
For now, this song comes to mind:
“You took so long… my dear… to finally arrive…”
