New Delhi/Washington, D.C. – The long-running trade relationship between India and the United States is once again at the center of global attention as Prime Minister Narendra Modi and President Donald Trump prepare for renewed negotiations aimed at easing tariffs, resolving energy concerns, and strengthening technology partnerships.
Following months of tariff escalations and growing market volatility, both leaders have signaled optimism that a new round of talks could produce a mutually beneficial outcome. Prime Minister Modi recently confirmed his intention to speak directly with President Trump “at the earliest opportunity” and emphasized that both nations remain “close friends and natural partners.”
This positive tone follows a turbulent period in which U.S. tariffs on Indian goods were raised, Indian imports of Russian oil came under scrutiny, and the Indian rupee experienced record lows amid investor concerns. Trade experts have cautioned that continued confrontation could strain one of the most strategically important economic relationships in the Indo-Pacific.
BACKGROUND
India–U.S. trade relations have experienced several ups and downs over the past decade.
- In 2019, the United States revoked India’s preferential GSP trade status, prompting retaliatory tariffs from New Delhi.
- Under President Biden, the two nations settled multiple WTO disputes and rolled back tariffs on key goods such as almonds, apples, and lentils.
- In 2024, India joined the Indo-Pacific Economic Framework (IPEF) and deepened defense and technology cooperation under the Initiative on Critical and Emerging Technologies (iCET).
However, 2025 has seen a renewed hard line from Washington. U.S. tariffs have been raised on a broad range of goods, with the administration linking further economic pressure to India’s continued energy ties with Russia. In response, India has emphasized its right to pursue an independent energy policy while expressing willingness to diversify supply chains over time.
THIRD-PARTY DIPLOMACY AND THE “GOLF COURSE” MOMENT
Reports have emerged of informal, third-party interventions aimed at softening tensions between the two leaders. According to commentary in international media, a private Indian intermediary is said to have met President Trump briefly on a golf course earlier this summer. Though not an official envoy, the individual reportedly discussed India–U.S. ties in general terms, helping to create space for the White House to adopt a more constructive tone toward New Delhi.
While neither government has confirmed the encounter, diplomatic analysts suggest such informal moments can play an outsized role in rebuilding trust, allowing leaders to recalibrate their public stance without losing face.
EXPECTED NEGOTIATION POINTS
The upcoming discussions are expected to focus on:
- Targeted tariff relief on Indian exports in sectors such as textiles, pharmaceuticals, and engineering goods.
- Energy cooperation frameworks, including phased adjustments to India’s Russian crude purchases and expanded LNG partnerships.
- Technology and defense collaboration, with new export-control waivers and co-production opportunities under iCET.
- Digital economy engagement, with both sides likely to avoid reopening disputes over India’s digital services tax while global OECD frameworks are finalized.
IMPACT AND OUTLOOK
A limited agreement could stabilize currency markets, reassure global investors, and reaffirm India’s role as a key U.S. partner in balancing China’s rise in the Indo-Pacific. For President Trump, a successful deal would showcase his “reciprocity” approach to trade while preserving strategic ties with a critical ally.
Experts caution that while a full-scale Free Trade Agreement is unlikely in the near term, a “skinny deal” that combines tariff exclusions with energy and technology deliverables could set the stage for deeper cooperation over the next 12–18 months.
“Small gestures — even rumored conversations on a golf course — can have a surprisingly big impact in diplomacy,” said a senior trade analyst. “Both Modi and Trump understand the value of symbolism, and that could be the catalyst for de-escalation.”
ABOUT THIS INITIATIVE
The Government of India and the Office of the U.S. Trade Representative have confirmed that working-level teams will meet later this month, with a potential Modi–Trump follow-up meeting expected before the end of the year.