3 Reasons Why Trump Won't Treat India Like China

The recent election of Donald Trump as the U.S. President has sparked speculation about his trade policies, particularly regarding India and China. While Trump's first term was marked by a contentious trade war with China, many wonder if he will adopt a similar approach with India. However, there are several reasons why Trump is unlikely to treat India like China.

First, India's strategic importance in the Indo-Pacific region sets it apart from China. Trump's foreign policy has been focused on countering China's growing influence, and India has emerged as a crucial partner in this endeavor. The signing of defence agreements like BECA (Basic Exchange and Cooperation Agreement) and enhanced military collaborations under the Quad Grouping (India, the US, Japan, and Australia) have strengthened US-India ties. These strategic partnerships have led to increased defence trade, with India purchasing American weaponry like the Apache and Chinook helicopters and making deals for missile systems. This alignment of interests makes it unlikely that Trump will adopt a confrontational approach with India, as he has with China.

Second, India's potential as a market for US exports, particularly in energy and defence, shapes Trump's approach to bilateral trade. India is the world's third-largest energy consumer and the fifth-largest market for US energy exports. The US has been a key supplier of crude oil and liquefied natural gas (LNG) to India, with exports reaching $11.8 billion in 2020. In the defence sector, India is a crucial market for US exports, with defence trade between the two nations reaching $18.2 billion between 2008 and 2020. Trump's focus on boosting US exports and creating jobs at home makes it unlikely that he will impose tariffs or other trade barriers on India, as he has done with China.

Third, India's role in countering China's influence in the Indo-Pacific region has a significant impact on Trump's trade policies toward India. The escalating US-China rivalry under Trump's leadership is likely to intensify, impacting global trade and investment flows. This rivalry offers opportunities for India to position itself as an alternative manufacturing hub. However, India must leverage this rivalry to ensure that its strategic partnerships with both powers remain intact. Trump's firm approach to China resonated strongly with India, particularly as tensions between India and China escalated over border disputes in 2020. His administration imposed tariffs on Chinese goods and restricted Chinese tech companies like Huawei, indirectly benefiting Indian businesses. This shared interest in countering China's influence makes it unlikely that Trump will adopt a confrontational approach with India, as he has with China.

In conclusion, India's strategic importance in the Indo-Pacific region, its potential as a market for US exports, and its role in countering China's influence make it unlikely that Trump will treat India like China. While challenges such as high tariffs on US goods and potential trade tensions remain, the strong economic relationship between the US and India, as well as their shared strategic interests, suggest that Trump's approach to bilateral trade with India will be mutually beneficial.