Under Trump, What Will Happen to the U.S.-India Relationship?

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Whatever the topics that are down on their respective agendas, it seems unlikely Prime Minister Narendra Modi will enjoy the same cordial relationship that he had with previous President Barack Obama.

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President Donald Trump has shown scant interest in international leaders unless he sees a clear short-term advantage. So, whereas Saudi Arabia and Israel received the famous presidential charm, fellow NAFTA members Canada and Mexico have been more the brunt of threats and Europe has largely been treated with disdain.

India has barely featured on Trump’s radar since coming to power, beyond garnering criticism for receiving foreign aid and allegations of stealing American jobs.

So it is to be expected there will be some prickly discussion around the new president’s plans to curtail the number of H1B visas, a move the Washington Post observes would harm big Indian outsourcing companies, such as Infosys and Wipro, and deprive Silicon Valley of much-needed imported talent.

The Trump administration is also likely to raise concerns about the U.S. trade deficit with India, following a blossoming of trade during the Obama years that has resulted in India enjoying a $30 billion trade surplus with the U.S.

But one particularly thorny subject that could make its way onto the agenda is a long-running trade dispute in which India took the U.S. to the World Trade Organization (WTO) after Washington failed to comply with the WTO settlement body’s ruling over countervailing duties imposed on Indian steel imports. The ruling back in December 2014 concerning duties on hot-rolled carbon steel flat products was deemed to be in breach of WTO rules under the agreement on subsidies and countervailing measures agreement.

The U.S. has largely ignored the ruling, so the two leaders’ meeting would be a good opportunity to kickstart a review. However, so tenuous is the relationship that it will be interesting to see whether mention of steel disputes or tariff barriers make their way into media statements or the closing statements of either party.

Under Obama, India and the U.S. moved closer together and the two countries, not least as the two largest democracies in the world, have always championed their common qualities over their differences — but Trump’s view of the world is significantly different from that of the Obama administration. Beyond tackling North Korean nuclear ambitions, Washington doesn’t seem to have a Southeast Asian policy any more.

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The leaders held a friendly joint press conference in the Rose Garden on Monday, during which Trump called himself a “true friend” to India and touted the two nations’ “shared commitment to democracy.” He also added that the bond between the two countries “has never been stronger.”

He also made remarks in reference to the U.S.’s trade deficit with India.

“I look forward to working with you Mr. Prime Minister to create jobs in our countries, to grow our economies, to create a trading relationship that is fair and reciprocal,” Trump said Monday. “It is important that barriers be removed to the export of U.S. goods into your markets and that we reduce our trade deficit with your country.”

However, quite where India fits in the new administration’s view of the world is unclear. Hopefully the leaders meeting this week will bring a little more clarity in the future.

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