World
India
It was all smiles and gestures of goodwill when US Vice President JD Vance, accompanied by his wife Usha and their three children, visited Indian Prime Minister Narendra Modi on Monday evening. Modi gave the Vance children peacock feathers as gifts and personally showed the family around his official residence, creating a warm and friendly moment.
But behind the cameras and the cordial atmosphere, a storm was brewing. Hanging over the visit was a looming threat from US President Donald Trump—a threat to impose steep tariffs on Indian goods as part of his broader trade war. Although the US has paused some of these tariffs for 90 days until July 8 (excluding China), India is still facing a 10 percent tariff on its exports to the US.
Vance’s four-day visit comes at a time when India is urgently trying to avoid a full-blown tariff crisis. These proposed “reciprocal” tariffs—like the potential 26 percent duty on Indian exports—could hit India hard if a deal isn’t reached in time.
Inside the Modi-Vance Meeting
The Indian Prime Minister hosted the American Vice President and his family with a mix of personal warmth and diplomatic purpose. In their private talks, the two leaders discussed progress in areas like energy, defense, and strategic technology.
“They reviewed and positively assessed the progress in various areas of bilateral cooperation,” Modi’s office said in a late-night statement. It added that both leaders “welcomed the significant progress in the negotiations for a mutually beneficial” trade deal.
Vance’s office echoed the sentiment, calling the trade talks a chance to shape a “new and modern” agreement that benefits job creation and public welfare in both nations.
His visit builds on earlier outreach during Trump’s second term. Modi had already visited Washington, DC, in February, and Trump is expected to visit India later this year for the Quad summit—an alliance involving the US, India, Japan, and Australia seen as a bulwark against China’s influence in the Indo-Pacific.
India’s foreign ministry spokesperson Randhir Jaiswal said Vance’s visit would “further deepen the India-US comprehensive global strategic partnership.”
Farmers on Edge: Protests Across India
While Vance was enjoying India’s historic landmarks like the Taj Mahal, scenes of protest erupted in rural villages. Farmers gathered to burn effigies of the visiting US official, chanting: “Go back, Vance. India is not for sale!”
The protests are driven by deep concerns. For years, India has protected its farming sector with high tariffs to shield local agriculture from cheaper foreign imports. Now, many farmers fear these protections might be sacrificed to make a deal with Trump.
“We are completely kept in the dark about these trade negotiations – there is no transparency,” said Vijoo Krishnan, general secretary of the All India Kisan Sabha (AIKS), a farmers’ union tied to India’s Communist Party. “If it includes the farming sector, then we are doomed.”
Trade by the Numbers: A Critical Economic Relationship
India and the US are major trading partners. In 2024, their bilateral trade hit $129.2 billion—higher than India’s trade with China ($127.7 billion). Unlike trade with China, which is heavily skewed in China’s favor, India enjoys a positive trade balance with the US.
India exported $87.4 billion worth of goods to the US last year, while US exports to India stood at $41.8 billion. Indian exports include pearls, electronics, pharmaceuticals, chemicals, and textiles. The US, in return, sells crude oil, medical equipment, machinery, and luxury items to India.
Still, the US runs a $45.7 billion trade deficit with India, making India the 10th largest contributor to America’s global trade gap. In contrast, China’s trade surplus with the US in 2024 stood at a whopping $295 billion.
Trump’s Tariff Crusade and India’s Response
Trump has long accused India of being a “tariff abuser.” During Modi’s Washington visit in February, Trump said: “It’s very hard to sell into India because they have trade barriers, very strong tariffs.”
He repeated those charges in March, saying, “India charges us massive tariffs, massive. You can’t even sell anything into India.”
Still, Trump admitted some progress. “They’ve agreed, by the way, they want to cut their tariffs way down now because somebody’s finally exposing them for what they’ve done,” he said.
But critics say India’s approach has been too soft. “The Indian side has not shown any strength or resilience,” said economist Jayati Ghosh. “The US is essentially using bullying tactics to try and extract as many concessions as possible. It is very bad for India’s security and economy – and it is unacceptable.”
India’s High Tariffs: A Sticking Point
India has made some recent cuts, like reducing tariffs on luxury bourbon (from 150% to 100%) and Harley-Davidson motorcycles (from 50% to 40%). But most other tariffs remain steep.
Imported alcohol still faces a 150% duty, while premium vehicles and some agricultural imports can be taxed up to 125%. India’s average tariff is around 17%, compared to 3.3% in the US.
In agriculture, the gap is even wider. India imposes an average 39% tariff on farm goods, while the US levies just 4%. For example, US almonds, apples, and walnuts face heavy tariffs in India, while Indian shrimp, spices, and oils face relatively easy access to American markets.
Where the Talks Stand Now
India’s Finance Minister Nirmala Sitharaman said Monday that a first phase of the trade deal could be completed by the end of the year. But Trump’s tariff pause only lasts until July, and it’s unclear if this timeline will satisfy Washington.
“Trump doesn’t want rules in trade,” said trade economist Biswajit Dhar. “India has to ensure that it’s a win-win situation. We cannot have Trump have his say.”
Former diplomat Anil Trigunayat said India must explain its political constraints during the talks. “We start with a maximalist position. And then they come somewhere in between. But we always must safeguard our citizens’ needs.”
Agriculture: The Heart of the Battle
At the core of India’s resistance to US pressure is agriculture. Nearly half of India’s population relies on farming for income. Over the decades, India has become food surplus and a leading exporter—particularly of rice, which makes up 40% of global exports.
Still, India keeps high tariffs to protect its farmers. Opening the sector further, as the US demands, would expose Indian growers to fierce competition from heavily subsidized American producers.
Krishnan of the AIKS said, “The Modi government has been sliding in a direction of free trade and slashing import duties – and if it includes the farming sector, then we are doomed.”
Indian farmers have flexed their political power before. In 2021, they staged massive nationwide protests that forced the Modi government to withdraw three controversial farm laws.
“The protests and rolling back the laws were a humiliating defeat for the Modi government – they are taking revenge on the farmers by pushing them under the bus now,” Krishnan added.
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