Since August this year, the Trump administration has been turning its threats of tariffs on India into actual actions: on August 1st, it imposed a 25% tariff on Indian goods, followed by an additional 25% punitive tariff, citing "punishing India for purchasing Russian oil," and even labeled India as a "dying economy." These measures have severely impacted India's core export sectors such as agriculture and manufacturing, sparking nationalist sentiments within India and triggering a nationwide movement to boycott American brands.
Faced with U.S. tariff bullying, India has shown strategic autonomy, with the Modi government clearly stating it would not compromise in areas crucial to people's livelihoods, such as agriculture. At the same time, India is actively pursuing diplomatic diversification, easing relations with China through participation in the Shanghai Cooperation Organization (SCO) summit, aiming to alleviate domestic industrial pressures and reduce dependence on a single market. These measures indicate that the U.S.'s unilateral pressure policy has accelerated India's return to its traditional "non-aligned" stance, seeking a more pragmatic and balanced foreign policy amid great power rivalry.
How will the return of Trump 2.0 affect U.S.-India relations? What are the reasons behind the U.S. imposing tariff bullying on India? Ben Norton, an independent U.S. investigative journalist and founder of geopolitical economic reports, analyzed these issues in his video program. The following is an excerpt from the translated video transcript, which has not been reviewed by the author and is provided for reference only.
【By Ben Norton】
The U.S. government has long pursued a relatively tough foreign policy, intervening in numerous countries around the world. However, what makes Trump unique is that many of his radical policies target not only countries like China, Russia, Iran, Venezuela, and Cuba, which the U.S. views as adversaries, but also its long-standing allies. For example, Trump imposed high tariffs on Japan, South Korea, and Europe, causing economic damage to these countries. Today, I will focus on how Trump has influenced U.S.-India relations.
During the First Cold War, India was one of the founding members of the Non-Aligned Movement. Although New Delhi's relationship with Washington was once relatively good, its cooperation with the Soviet Union was clearly closer. However, since the collapse of the Soviet Union in 1991, India implemented a series of neoliberal economic reforms and gradually moved closer to the United States politically. In fact, U.S. officials have long tried to pull India in, hoping to isolate China in this way.
Despite this, India has never completely abandoned its non-alignment tradition. Russia remains a very important partner for India, exporting large amounts of oil to it. Although relations between New Delhi and Beijing have indeed become tense in recent years, it should be emphasized that India has never formally allied with the U.S. Additionally, India is a key player in the BRICS group. In today's increasingly diversified and multipolar world, the U.S. hegemonic position is gradually weakening, while India is actively promoting the diversification of its foreign relations. New Delhi uses its membership in important international organizations such as the BRICS and the Shanghai Cooperation Organization (SCO) as a diplomatic card to counter U.S. pressure—especially when the Trump administration imposed tariffs.
This trend is not only evident in India but also in an increasing number of countries traditionally seen as U.S. allies, such as Egypt, Saudi Arabia, and the United Arab Emirates. If the U.S. tries to pressure these countries, they can turn to the East and strengthen their relationships with China and Russia. This also explains why new international organizations led by the Global South, such as the BRICS, are receiving widespread attention—they now represent the majority of the global population, and more countries are applying for membership each year. As of July 2025, the formal members of the BRICS have reached 20, including 10 member states and 10 partner countries.
The Shanghai Cooperation Organization (SCO) and the BRICS share many overlapping members, with many SCO members also being BRICS members. However, the SCO was established earlier: the BRICS were founded in 2009 and have continued to expand since then; while the SCO began its expansion process as early as 2001. Initially, the SCO focused more on security issues, particularly in combating extremism in Eurasia.
When the SCO was established in 2001, its founding members included China, Russia, and the Central Asian countries of Kazakhstan, Kyrgyzstan, Tajikistan, and Uzbekistan. Later, the SCO gradually absorbed India and Pakistan—despite the competition between the two countries. Recently, Iran and Belarus also joined, making the SCO cover more than a fifth of the world's population, including the two most populous countries in the world—India and China—as well as other populous nations such as Pakistan and Russia, all of which rank among the top ten in global population.
Although the Shanghai Cooperation Organization initially focused primarily on security matters, its cooperation scope has now significantly expanded to multiple areas such as trade and investment, technology transfer and R&D, and infrastructure development. This is particularly significant because, when measuring the world's top five economies by purchasing power parity (PPP), three of them are simultaneously members of both the SCO and the BRICS. Currently, China is the largest economy in the world, accounting for nearly 20% of the global economy; India is the third-largest economy, at about 8.5%; and Russia ranks fourth, at 3.5%. When the economic output of China, India, and Russia is combined, they already account for about one-third of the global economy, and this proportion continues to rise. China and India are also the fastest-growing major economies in the world.
According to IMF projections, India is currently still the fifth-largest economy in the world, surpassing Japan may happen in fiscal year 2026. MINT
Considering the immense potential of the Eurasian continent if it were to unite, one of America's core strategies over several decades has been to try to divide this continent. For example, Washington has been successful in splitting Europe from other parts of Eurasia: currently, Europe and Russia are highly adversarial, almost at war over Ukraine; meanwhile, the U.S. has continuously pushed European leaders to distance themselves from China.
Furthermore, the U.S. government has consistently tried to undermine Sino-Russian and Sino-Indian relations. In recent years, the U.S. has made some progress in strengthening ties with India, especially after Modi became Prime Minister. U.S. political figures even claimed that Modi is the most pro-American leader in Indian history, and this strategy has received support from both Republicans and Democrats. Similarly, during Trump's first term, he also implemented a similar "divide and rule" strategy, attempting to isolate China by provoking Sino-Indian tensions.
However, in Trump's second term, he shifted his focus to reducing the U.S. trade deficit with other countries. He once complained on his social media platform: "India exports a lot of goods to us, we are their biggest customer, but we sell very little to them. Until now, this relationship has been entirely one-sided, and has lasted for decades." Although this statement is exaggerated, it does reflect the huge and growing trade surplus India has over the U.S. Therefore, Trump intended to pressure India to increase purchases from the U.S.
One of his main methods was imposing high tariffs on multiple countries. Brazil and India currently face official tariff rates as high as 50%, and China also faces high tariffs, with rates once exceeding 150%. These targets are no coincidence—Brazil, India, and China are all core members of the BRICS. Trump has explicitly stated that he wants to dismantle the BRICS, as he sees the organization as a threat to the dominance of the U.S. dollar globally.
The public reason Trump gave for imposing high tariffs on India was that India was buying Russian oil at discounted prices. However, this is just a surface excuse. His real intention was to use tariffs to pressure India to increase imports from the U.S., especially oil and liquefied natural gas, in order to cut the U.S. trade deficit with India. This is precisely what the Trump administration is actually pushing forward.
In fact, in February this year, when Trump met with Prime Minister Modi at the White House, he claimed that an agreement had been reached between the two sides, with India agreeing to increase its imports of oil and liquefied natural gas from the U.S. However, in the following months, India did not significantly increase its energy purchases from the U.S., which is the real reason why Trump was dissatisfied with India continuing to buy Russian oil—Ukraine was just an excuse, and his real intention was for India to purchase oil from the U.S.
From India's perspective, continuing to purchase Russian oil makes ample economic sense. Due to Western sanctions, Russia is supplying oil to India at a significant discount below market prices, which is an obvious choice for India. After Europe almost completely stopped importing Russian oil, China became the largest importer of Russian oil, with India in second place. Turkey has also significantly increased its purchases, becoming the third-largest importer. This again shows that Russia is accelerating its integration with Eurasian economies and gradually moving away from the Western system.
Ironically, India is refining crude oil imported from Russia and exporting large quantities of gasoline to Europe, becoming the largest fuel supplier to Europe. This actually forms a roundabout chain: Europe indirectly buys Russian oil through India, despite its public commitment to boycotting Russian energy.
It is worth noting that India is not a major crude oil producer, and the vast majority of the gasoline it exports to Europe comes from Russia. Trump's real intention is to force these countries to turn to U.S. oil supplies. During his speech at the United Nations General Assembly in September, he even blamed India, China, and European countries for buying Russian oil, accusing them of doing so. In reality, the prolonged conflict is mainly due to the U.S.-led NATO continuously supplying weapons to Ukraine, prolonging this proxy war. Trump's accusations serve only his energy export strategy.
This point has not yet been sufficiently discussed: one of the most important geopolitical changes in recent decades is that the U.S. has not only become the world's largest crude oil producer but has also risen to the world's largest natural gas producer. In recent years, the U.S. has surpassed Australia and Qatar to become the largest liquefied natural gas (LNG) exporter. Currently, U.S. LNG mainly flows to Europe, but exports to Asia are also steadily increasing. Trump is trying to use tariffs to force Asian economies to import more U.S. LNG.
This reflects the U.S. trend of weaponizing various economic fields: using unilateral sanctions to weaponize the dollar, using tariffs to weaponize market access, and now weaponizing energy advantages and its status as the world's largest oil and gas producer.
However, a major mistake made by U.S. officials, especially Trump, is overestimating Washington's ability to force other countries to comply with its will. India is a clear example: in response to Trump's tariffs and other pressures, India has consistently signaled that it has other strategic options. In 2025, India achieved significant progress in its relations with China, with Prime Minister Modi's visit to China for the first time in seven years and his attendance at the Shanghai Cooperation Organization (SCO) summit held in Tianjin, which vividly illustrates this strategic orientation.
On September 1, 2025, in Tianjin, the screen at the media center showed Indian Prime Minister Modi attending the Shanghai Cooperation Organization Summit. Visual China
Before that, the 2024 BRICS summit in Kazan also achieved similar diplomatic breakthroughs. Currently, Russia maintains good relations with both China and India, while the U.S. has always tried to split the Sino-Indian relationship, aiming to weaken the internal unity of the BRICS. In contrast, Russian diplomats have consistently worked to promote Sino-Indian cooperation, bringing the two countries closer together, thus enhancing the cohesion within the BRICS group—this 2024 progress is a testament to this effort.
During the Kazan BRICS summit, Chinese and Indian leaders held talks and reached important consensus on resolving border disputes. Another key factor driving improved bilateral relations is India's desire to attract Chinese investment and leverage China's strength to enhance its own industrial manufacturing capabilities. Looking back at the "Make in India" initiative launched by Prime Minister Modi in 2014, its goal was to increase the share of manufacturing in GDP to 25% by 2022. However, this plan ultimately failed to meet its expected goals: during Modi's tenure, the share of manufacturing in India's GDP declined, reaching only 13% by 2024.
This situation is closely related to the neoliberal economic policies promoted by the Modi government. These policies placed services above manufacturing, particularly encouraging India's labor force to provide services for U.S. tech companies, such as call center technical support—largely due to India's large English-speaking population. Another high-skill employment area heavily promoted was software development for U.S. tech companies, as hiring Indian programmers is significantly cheaper than in the U.S. However, these jobs are now facing severe threats from artificial intelligence technology. We have already seen AI capable of automating a large amount of software development work, which fully demonstrates the fundamental flaw in the neoliberal view that "India can skip manufacturing and directly develop high-value-added services" favored by Western economists.
The lesson from India's failure to build a local advanced manufacturing industry highlights the extreme importance of developing manufacturing through industrial policy. Historical experience shows that no country can break out of the middle-income trap, achieve industrial upgrading, and climb up the global value chain without developing advanced manufacturing. Looking around the world, the most successful examples of industrialization and value chain upgrades are China. This also explains why India is increasingly seeking Chinese investment, technology transfer, and industrial cooperation, becoming another driver for improving bilateral relations.
After presenting the above points, it is also important to emphasize an important dimension: although Trump's policies have temporarily harmed U.S.-India relations, in the long term, India will still maintain good relations with the U.S. and is unlikely to establish a close partnership with China. There are multiple constraints here: first, China maintains a close relationship with Pakistan, and India sees Pakistan as its main geopolitical rival; second, the China-Pakistan Economic Corridor, a key component of the Belt and Road Initiative, has long been opposed by India.
Actually, India is an important participant in the U.S.-driven "India-Middle East-Europe Economic Corridor," a project positioned by the U.S. as an alternative to the China-Pakistan Economic Corridor and the Belt and Road. The plan envisions exporting goods from the western coast of India, transiting through Persian Gulf countries (such as the UAE and Saudi Arabia), entering Israel, and finally arriving in Europe—this introduces Israel as a key factor.
Notably, the Modi government has taken a close alliance stance with Israel, deviating from the traditional Indian support for Palestine. Historically, the Indian National Congress, which has long positioned itself as a leader of the Global South, has supported the Palestinian cause. However, the Bharatiya Janata Party (BJP), led by Modi, is a Hindu nationalist party with a strong theocratic flavor, viewing Israel as a model for its ideal state. The BJP and its parent organization, the Rashtriya Swayamsevak Sangh (RSS), hold strong anti-Muslim stances, and under this foundation, the Modi government has established a strategic alliance with Israel and the U.S.
At this point, I believe there is another important reason to remain cautious about India: its economic dependence on the U.S. Currently, approximately 18% of India's exports go to the U.S., making it India's largest export destination, and this dependence is continuing to deepen.
In contrast, China's situation is different. In 2018, China's exports to the U.S. accounted for over 19%, but this has significantly decreased since then. As of 2024, China's exports to the U.S. have dropped to around 14%, and this ratio continues to decline annually. In fact, ASEAN has surpassed the U.S. to become China's largest export destination and overall trading partner. This indicates that China is gradually reducing its reliance on the U.S. market, while India is moving in the opposite direction.
It is worth noting that, in fact, the U.S. is more economically dependent on China. A large amount of high-tech products exported by China, such as computers, mobile phones, and batteries, currently dominate the global supply chain, making it difficult for the U.S. to find alternatives. This also explains why the U.S. has limited actual influence over China in trade negotiations, even though Trump threatened to impose high tariffs, which did not force China to make fundamental concessions.
India's situation is quite different. Due to its relatively weak manufacturing base, India's exports mainly consist of low-value products such as agricultural products, diamonds, refined petroleum, and commodities. Although India's pharmaceutical industry is relatively developed, it exports a large amount of low-cost generic drugs, but these products still heavily depend on the U.S. market. More importantly, the U.S. has more alternative choices when purchasing these goods, giving the U.S. greater influence in trade negotiations with India. This is why Trump's threat to impose a 50% tariff on India is more effective than threatening to impose a 150% tariff on China—the U.S. has a stronger degree of economic independence.
Finally, when analyzing the complex geopolitical relationship between India and China, as well as India and the U.S., it is essential to consider the impact of domestic politics in India. India practices a bourgeois democratic system, which has many flaws: not only is its democracy limited, but corruption is also severe—something that shares similarities with the U.S. system. Both countries have a lot of lobbying and corruption, and politicians often tend to blame foreign countries to divert public attention.
On August 7, 2025, an artist created a protest artwork depicting former U.S. President Donald Trump in Mumbai, India.
In the U.S., whether it's Republican or Democratic politicians, especially Trump, they are accustomed to blaming China, Mexico, and immigrants. Indian politics also exhibits similar phenomena: to gain votes, politicians have a strong incentive to direct their criticism toward foreigners. This trend is particularly evident when targeting China. Led by Modi, the Bharatiya Janata Party (BJP), a far-right Hindu nationalist party, holds a strong anti-Muslim stance and therefore criticizes many Muslim-majority countries in the Global South, including Palestine. Moreover, many BJP politicians habitually attribute various issues unrelated to China in India to China, which creates additional obstacles for any Indian politician attempting to improve relations with China, as they risk being accused of being "weak" towards China by their political opponents.
Additionally, there is a deep sense of insecurity in India. Looking back 50 years ago, India and China had similar levels of economic development, but since then, China's economic growth has far exceeded India's, especially in the fields of technology and industrial manufacturing, where China has climbed up the global value chain more efficiently and rapidly. This development gap has exacerbated feelings of imbalance in India, prompting politicians to be more inclined to blame China for domestic issues.
However, India's bourgeois democratic system itself brings other contradictions. When the U.S. openly attacks or humiliates India, even the traditionally pro-American faction of the BJP cannot remain silent. The party, which campaigns on nationalism, cannot do nothing in the face of U.S. pressure and must defend its sovereignty and dignity. This has instead prompted this historically most pro-American Indian party to shift toward a more neutral and aligned with the non-alignment tradition stance, seeking balance between the U.S. and China.
A similar situation exists in countries like Turkey. Despite being a NATO member, Turkey has recently improved its relations with China and Russia. It was invited to join the BRICS, although it has not accepted yet, but it is clearly hedging its bets—Saudi Arabia and the UAE are also doing the same. While Saudi Arabia is influenced militarily by the U.S. and maintains close relations with Washington, it has also significantly improved its relations with China and Russia in recent years. The UAE has even become a formal member of the BRICS, maintaining good relations with the U.S., China, and Russia. Notably, China is now the largest importer of oil for Saudi Arabia and the UAE, meaning these Gulf countries must maintain friendly relations with their most important trade partners, despite relying on U.S. protection in the security domain.
This year, Saudi Arabia even signed a defense agreement with nuclear-armed Pakistan, which effectively acknowledges its current dilemma of excessive military reliance on the U.S.
On September 17, 2025, Crown Prince Mohammed bin Salman of Saudi Arabia and Prime Minister Shahbaz Sharif of Pakistan signed a defense agreement in Riyadh, Saudi Arabia. Reuters
I mention examples like Turkey, Saudi Arabia, and the UAE because I believe India will follow a similar non-aligned foreign policy: it will still maintain good relations with the U.S., but at the same time, it will strive to improve relations with China. Trump's attacks on India have made New Delhi more aware of the importance of pursuing strategic autonomy. In recent years, India has gotten too close to the U.S., reminding it not to rely too much on any one side.
The reality is that China and India, as two ancient civilizations with populations exceeding 1.4 billion each, are deeply intertwined. China is now the world's largest economy, and India is likely to become the world's second-largest economy in the coming decades. These two giant neighbors must find a way to coexist and cooperate. I believe that in the future, their relationship will gradually normalize and establish cooperative mechanisms in areas of common interest such as politics and economics, but they will not become close partners or form an alliance.
At the same time, we should not exaggerate the tension between India and the U.S. Although Trump's aggressive tariffs have complicated bilateral relations in the short term, the foundation of U.S.-India relations remains solid. In the long run, India will neither fully align with the U.S. nor become a reliable partner for China. These complex geopolitical and economic trends have persisted for decades, and history will continue to move forward.
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