The consequences of Trump's mistreatment of India
The cozy pictures of Modi, Putin, and Xi reflect a shift in the geopolitical dynamic.
The pictures from the Shanghai Cooperation Organization gabfest of Indian Prime Minister Narendra Modi’s cozy interactions with Russian and Chinese strongmen Vladimir Putin and Xi Jinping were geopolitically important. And they illustrate how Donald Trump’s foreign policy neither serves U.S. interests nor fits the reality of today’s world.
No country has been treated more rudely by Trump’s tariff policy than India, although Brazil and Switzerland have competitive claims. Indian imports face a tariff rate of 50%. Twenty-five percent supposedly for importing Russian oil, although neither China nor Turkey, both also large Russian oil importers, have been similarly singled out. The other 25% is one of Trump’s inscrutable “just because” rates.
There is no economic rationale for India having the highest U.S. tariff rate in the world, save only China. Even if trade deficits are a sign of economic weakness, as Trump mistakenly believes, India isn’t a significant contributor to ours.
The United States imports roughly $3 trillion of goods a year. Only around $85 billion, or about 3%, comes from India. The U.S. trade deficit with India is just $45 billion or less than 5% of the approximately $1 trillion total.
India has become a geopolitically significant country. During the Cold War, it prided itself on being the leader of what it denominated the non-aligned movement, staying out of the global competition and conflict between the United States and the Soviet Union. As a practical matter, however, India tilted toward the Soviet Union, particularly with respect to defense.
In the post-Cold War era, India had begun to tilt toward the United States and fellow democracies in the new competition between democratic capitalism and authoritarianism. The redirection began when the United States effectively accepted India as a nuclear power during the George W. Bush presidency. It has been steadily moved along by Indian concern about China’s increasingly aggressive regional posture. This has been reflected in the purchase of military kit, with India purchasing more from the United States and less from Russia, although it still buys more from Russia than the U.S.
However, India has maintained a policy of strategic independence, and hadn’t fully joined the democratic alliances that, pre-Trump II, was potentially developing to check Russia and China. Creating a power balance in the Indo-Pacific to check China is much, much more realistic with India than without India. Continuing India’s drift toward the democratic capitalist camp was a significant strategic imperative, perhaps the most important in all the world.
Trump inherited ripe circumstances for renewed and rebalanced democratic alliances in both Europe and the Indo-Pacific, more because of Russian and Chinese overreach than deft diplomacy by the Biden administration. The Russian invasion of Ukraine convinced European countries of a serious security threat and China’s state capitalism of a worrisome economic threat. China’s incessant testing and probing of international boundaries and its wolf warrior diplomacy set the teeth of democratic countries in the Indo-Pacific, including India, on edge.
Turning the potential of renewed and rebalanced democratic alliances into something consequential would have been a difficult and tricky undertaking. However, Trump had no interest in it. And his erratic, deracinated foreign policy is eroding, if not obliterating, the potential.
Trump seems to believe that the United States still has the elevated geopolitical standing and power it had after the collapse of the Soviet Union. However, instead of using that position to protect international order and a rules-based trading system, Trump wants to use it for whatever catches Trump’s passing fancy.
Trump is correct that the United States has the world’s largest and most attractive consumer market. But he overestimates the leverage that gives the U.S. over the behavior of other countries. There’s a big world outside the United States and it has made significant economic progress over the last half century.
Less than a fifth of India’s exports are headed to the United States. The U.S. share of China’s exports is even smaller. Other countries will want to make deals to gain access to the U.S. market with the best terms possible under Trump’s erratic tariff regimen. But not enough to abandon other strategic and sovereign interests. And the view of the United States as a steady and reliable ally, in terms of security or economics, has been shattered.
There may yet be a trade deal between the United States and India. But, after Trump’s tariff treatment, what reason does India have to believe that increasing security or economic relations with the United States is in its long-term interests? The Shanghai interactions with Putin and Xi weren’t just for show. They were a shift in the geopolitical dynamic.
The United States may be able to recover from Trump’s domestic malpractice. I’m actually guardedly optimistic that we will. With respect to international relations, however, even guarded optimism is difficult to muster.
Reach Robb at robtrobb@gmail.com.