No reset to past, but reframing of future

The India-US relationship now is shaped by forces and communities far larger than the world of officialdom

- Rudra Chaudhuri

Those sectors in India focussed on exports to the US and elsewhere can take a breath.

(HT ARCHIVE)

On February 2, US President Donald J Trump wrote on X: “Out of friendship and respect for Prime Minister (PM) Modi and, as per his request, effective immediately, we agreed to a Trade Deal.”

A little while later, PM Modi wrote: “Delighted that Made in India products will now have a reduced tariff of 18%”. “I look for-ing closely” to take the India-US “partnership to unprecedented heights”. The tariff reduction from 50%, if the penalty for importing oil from Russia was to be included, to 18% has set the stage for a breather, at the very least. As expected, the markets in India have quantitatively welcomed the announcements.

In a world where tariffs and the threat of tariffs have been increasingly normalised as an instrument of statecraft, at least for the US, 18% is excellent news. The details on the trade deal are still trickling in. At the very least, those sectors in India focussed on exports to the US and elsewhere can take a breath. The implications, if any, for market access to India’s agricultural sectors are yet to be outlined.

On balance, and while details, of course, matter, this is generally good news. There is too much at stake between India and the US. Importantly, that the two principals are talking and celebrating each other's pronunciations on the deal, and the future of this crucial relationship is even better news. There is little doubt that apart from the strategic patience and the tireless efforts by Indian leaders and negotiators, the ambassadors in both countries did more than turn a knob.