Bringing manufacturing back to the U.S., especially from China, has been a central tenet of Donald Trump\u2019s economic playbook. In this context, India has emerged as a key alternative to China in the global manufacturing arena.<\/p>\n
\u201cWe still expect India to remain a beneficiary of the \u2018China plus one\u2019 strategy, as diversification is a bigger driver of this trend,\u201d noted Asia Insight, a market research firm, in a recent report.<\/p><\/blockquote>\n
Hence, India\u2019s role in managing this great power rivalry is \u201cvery, very critical”. As the U.S. attempts to de-risk its supply chains from China, India represents a strategic compromise, geographically well-placed, diplomatically pragmatic, and economically ambitious. This co-production model could help India \u201ccut China out\u201d and allow the U.S. to position itself more strategically while India continues to walk its own tightrope.<\/p>\n
Walking the BRICS Tightrope<\/strong>
\nAt the same time, India\u2019s delicate dance within the BRICS alliance (which now includes Brazil, Russia, India, China, South Africa, and newer additions like Egypt and Ethiopia) offers it some flexibility in bilateral dealings with the U.S. However, it\u2019s also where global loyalties get tested.<\/p>\nAccording to the Carnegie Endowment for International Peace, BRICS is increasingly working to challenge Western-led global institutions and reduce the dominance of the U.S. dollar.<\/strong> On July 6, Donald Trump threatened to impose a 10% additional tariff on countries aligning with the \u201canti-American policies of BRICS,\u201d even as Prime Minister Modi was attending the bloc\u2019s summit in Brazil.<\/p>\nTrump doubled down on the rhetoric days later, warning that he would \u201chit BRICS very, very hard\u201d if they ever \u201creally form in a meaningful way.\u201d \u201cWe can never let anyone play games with us,\u201d he declared.<\/p>\n
Within the group, China sees India as a competing power, vying for influence and leadership. But from Washington\u2019s viewpoint, India can play a valuable role as a counterbalance to Beijing, especially if it helps dilute BRICS\u2019 ambitions of creating an alternative reserve currency to rival the U.S. dollar.<\/p>\n
That alone could be a critical bargaining chip.<\/strong> As Mizuho\u2019s Varathan explained, \u201cIndia could convince Trump that they\u2019re not on board with the alternate currency plan,\u201d which might incentivize him to treat New Delhi with more diplomatic leniency.<\/p>\n![\"Trump,](\"https:\/\/static.toiimg.com\/thumb\/msid-122610431,width-375,height-250\/122610431.jpg\")
<\/p>\n
India\u2019s Plan B: The Multi-Alignment Strategy<\/strong>
\nAmid the growing uncertainty in U.S.-India trade relations, India is quietly stitching together a broader fallback strategy. As part of its \u201cmulti-alignment\u201d approach, it is accelerating talks with other global players.<\/p>\nIndia has already finalized a trade deal with the UK and is in advanced negotiations with the European Union, the Maldives, and several other partners.<\/strong> \u201cThis is part of India\u2019s increased turn toward a multi-alignment strategy,\u201d said Sarang Shidore, director of the Global South program at the Quincy Institute.<\/p>\nAt the same time, India continues to emphasize its strategic ties with the U.S., which it still considers a vital partner. This diversified diplomacy gives India more leverage at the negotiating table especially when facing high-pressure tactics or tariff threats.<\/p>\n
More than just a hedging tactic, this reflects India\u2019s evolving worldview: that of a rising power unwilling to be boxed into any single geopolitical camp. One that seeks to maintain its strategic autonomy while championing the Global South on the world stage.<\/p>\n
India’s Next Strategy?
\nTrump\u2019s tariff threats mark a dramatic inflection point in U.S.-India trade relations, but not an irreversible one. Here’s how this could unfold across key scenarios:<\/p>\n
1. India Absorbs the Shock, Then Regroups<\/strong><\/p>\nIf the 25% tariffs kick in, sectors like gems, pharma, electronics, and apparel will be hit hard. But India is unlikely to capitulate immediately. Instead:<\/p>\n
—Expect short-term disruptions, job losses, and margin compression in key export sectors.<\/p>\n
—India may re-route supply chains, deepen ties with the EU\/UK, and seek trade diversification.<\/p>\n
–Domestically, this will strengthen Make-in-India and PLI (Production-Linked Incentive) programs to replace lost U.S. demand with other markets or local consumption.<\/p>\n
–India has dealt with similar shocks before (e.g., GSP withdrawal in 2019) and didn\u2019t fold then\u2014it won\u2019t now either.<\/p>\n
2. Strategic De-escalation: Quiet Diplomacy, Delayed Retaliation<\/strong><\/p>\nTrump\u2019s style is pressure-first, deal-later. India may:<\/p>\n
—Wait Trump out until after U.S. elections or his second-term clarity.<\/p>\n
—Use BRICS diplomacy and oil pricing as leverage to negotiate sectoral exemptions (like pharma, IT).<\/p>\n
—Offer limited market access (excluding agriculture) in exchange for tariff rollback or phased relief.<\/p>\n
—India could even strike behind-the-scenes assurances on Russian oil purchases in exchange for softening penalties, something it has done before with Iran sanctions.<\/p>\n
3. The BRICS Card: India Hedges Further, But Doesn\u2019t Flip<\/strong>
\nIndia won\u2019t abandon BRICS or the Global South, but it won\u2019t go fully anti-West either.<\/p>\nExpect strategic ambiguity on the BRICS currency issue – India will delay, dilute, or dissent without formally exiting.<\/p>\n
This will allow New Delhi to tell Washington: \u201cWe\u2019re not with China on this.\u201d That message may buy breathing room from Trump.<\/p>\n
4. Domestic Politics Take Priority<\/strong>
\nIndian elections are due in 2029, but state elections and domestic sentiments matter now.<\/p>\nAny U.S. pressure on agriculture, MSMEs, or oil subsidies is politically toxic.<\/p>\n
Expect no movement on agri imports or energy compromise, especially if the BJP wants to hold rural states.<\/p>\n
India will choose domestic stability over external appeasement, especially under threat.<\/p>\n
![\"Trump](\"https:\/\/timesofindia.indiatimes.com\/photo\/msid-122518252\/122518252.jpg?resizemode=4\")
<\/p>\n
Can Trump Really Do Without India?<\/strong><\/p>\nShort-term – maybe. Long-term – absolutely not!<\/p>\n
Here\u2019s why: \u00a0India = China Diversification<\/strong>
\nIndia is central to Washington\u2019s China+1 strategy. Trump wants to cut Beijing out of U.S. supply chains but you can\u2019t replace China with Ohio alone. India is the largest scalable, democratic alternative in Asia.<\/p>\nTherefore, no India = no real China decoupling.<\/p>\n
2. Trade War Blowback Hurts U.S. Too<\/strong>
\nIndian generics keep U.S. healthcare costs down.<\/p>\nIndian engineers and firms are critical to Silicon Valley\u2019s ecosystem.<\/p>\n
Tariffs may hurt American consumers and companies, not just Indian exporters.<\/p>\n
Tariff war with India is a lose-lose for both economies, especially in pharma, IT, and consumer goods.<\/p>\n
3. BRICS Leverage<\/strong>
\nIf Trump pushes too hard, he risks pushing India deeper into BRICS.<\/p>\nThat could:<\/p>\n
Accelerate dollar de-dollarization efforts.<\/p>\n
Undermine G7 control over global trade and finance.<\/p>\n
Leave the U.S. isolated as India builds new economic architectures.<\/p>\n
Trump may talk tough, but he can\u2019t afford to let India go to the other side.<\/p>\n
4. The Indo-Pacific Geopolitics<\/strong>
\nIndia is a bulwark against China in the Indo-Pacific. The Quad (U.S.-India-Japan-Australia) is meaningless without India. If Trump loses India\u2019s trust, he loses Asia and hands strategic space to Beijing and Moscow.<\/p>\n5. Diaspora & Political Optics<\/strong>
\nIndian-Americans are a rising political force in key swing states like Texas, Florida, and Georgia. Hostility to India could alienate this bloc and hurt Trump at home, especially with high-profile GOP donors in the Indian-American community.<\/p>\nThe Last Bit,\u00a0<\/strong>
\nTrump may push India hard with tariffs and secondary sanctions but India\u2019s new global posture isn\u2019t that of a submissive partner. It\u2019s a self-confident, rising power that knows how to withstand pressure.<\/strong><\/h6>\nIndia won\u2019t blink. And in the long run, Trump can\u2019t afford to treat India the way he treats China or Europe. He needs New Delhi, for supply chains, for counter-China strategy, and for keeping BRICS from becoming a true anti-U.S. bloc.<\/strong><\/h6>\nHence, without saying it loud or admitting it openly, here are two powers who need each other, but refuse to admit it.<\/strong><\/h6>\n <\/p>\n\n
\n\n\t\t\n
\n\t\t\t <\/ul>\n <\/div> \n","protected":false},"excerpt":{"rendered":"President Donald Trump has cranked up the tariff heat on India and in typical Trump fashion, the U.S. President took to his favorite megaphone, social media, to launch a direct attack on India\u2019s trade policies, its military purchases from Russia, and its growing appetite for Russian oil, amplifying his message – play ball, or pay the price. In a series of posts on Truth Social, Trump accused India of imposing sky-high tariffs and hiding behind what he called \u201cstrenuous and obnoxious\u201d non-monetary trade barriers. He also took aim at India\u2019s long-standing defense ties with Moscow, noting that New Delhi has become one of Russia\u2019s biggest energy buyers, alongside China, at a time when the West is urging Putin to pull back from Ukraine. \u201cIndia is our friend,\u201d Trump wrote, \u201cbut we\u2019ve done relatively little business with them because their tariffs are far too high\u2026 and they keep buying weapons and oil from Russia. All things NOT GOOD!\u201d And Tariffs Again.. The latest tariffs – 25% across the board on all Indian imports, plus an unspecified \u201cpenalty\u201d for its energy dealings with Russia, comes just after the U.S. wrapped up trade deals with Japan and the European Union. Those agreements may have given Trump confidence that he can squeeze more out of his remaining partners, and India seems to be next in line. Indian negotiators have been shuttling between Washington and New Delhi for months, hoping to hammer out a deal. At times, it seemed like a breakthrough was within reach. But with Trump\u2019s August 1 deadline, and no firm deal in place, the mood has shifted from optimistic to uncertain. According to sources familiar with the talks, the sticking point is simple: Trump wants full access for American producers – no half-measures. \u201cThey\u2019re willing to go part of the way,\u201d said one U.S. official, \u201cbut the president isn\u2019t in a \u2018part of the way\u2019 mood.\u201d Meanwhile, behind the scenes, there\u2019s little doubt that Trump is prepared to let the tariffs kick in. It\u2019s part of his broader strategy, exerting maximum pressure to bend even close allies into making deeper concessions. It\u2019s not personal, it\u2019s transactional. And with the U.S. still the largest consumer market on the planet, Trump knows he\u2019s got leverage. Kevin Hassett, Director of the National Economic Council, didn\u2019t mince words. Speaking at the White House on Wednesday, he said Trump is \u201cfrustrated\u201d with India\u2019s pace but believes the tariffs will force a rethink. \u201cOver time,\u201d he said, \u201cI\u2019d expect Indian firms to start onshoring production in the U.S. And maybe, just maybe, they\u2019ll open their markets more to us.\u201d Not To Be Pushed Over… Despite Trump\u2019s bombastic approach, New Delhi is refusing to break a sweat. The Indian government\u2019s response to the 25% duties and the vague but ominous \u201cpenalty\u201d tied to Russian oil purchases has been strikingly calm. If Washington expected panic, what it got instead was a patient shrug. So, what is behind this composure? Unlike some of its regional peers, India hasn\u2019t jumped into a deal just because the U.S. offered one. While Japan and the EU scrambled to strike last-minute arrangements with Washington, India held its ground, especially on one of its most politically sensitive fronts: agriculture. India has made it clear that opening up its markets to U.S. agricultural products is simply not an option, not now, and not under pressure. With millions of small farmers forming a crucial political base, giving in to American agribusiness would be like handing opposition parties a loaded weapon. And India\u2019s recent trade deal with the U.K. proves this point. Despite the pomp and pressure, New Delhi protected its most sensitive agricultural sectors from any tariff concessions, sending a strong message that it won\u2019t compromise domestic interests for diplomatic brownie points. Carlos Casanova, senior economist at UBP, broke it down bluntly: India isn\u2019t backing off because it doesn\u2019t have to. \u201cThe U.S. accounts for a relatively small portion of India\u2019s total exports. And opening up agriculture to American firms is a red line,\u201d he said. According to U.S. government figures, India\u2019s goods exports to the U.S. were around $87.4 billion in 2024, a significant number, yes, but hardly a make-or-break pillar of India\u2019s economy. Commerce and Industry Minister Piyush Goyal echoed this sentiment in a recent interview, where he made it crystal clear: protecting farmers and MSMEs (Micro, Small and Medium Enterprises) comes before anything else. \u201cWe are always very sensitive to the interests of our farmers\u2026 and will ensure our areas of concern are well protected,\u201d he said. Goyal also threw cold water on Washington\u2019s ticking-clock tactics. \u201cIndia does not negotiate trade deals based on deadlines,\u201d he stated, adding that while a deal with the U.S. would be welcome, India\u2019s national interest would not be compromised to meet an artificial timeline. His prediction whispers of a better deal (on India\u2019s terms) by October or November 2025. And it\u2019s not just talk. India\u2019s recent trade agreement with the U.K. is being held up as a template for how New Delhi intends to deal with all Western powers going forward: calmly, confidently, and on its own terms. Russia, Oil, and the Penalty Nobody\u2019s Naming (Yet) As Trump ratchets up tariff threats, he\u2019s also dangling a much bigger stick: secondary sanctions on countries buying Russian oil. It\u2019s not a new idea, it\u2019s been toyed with by past U.S. administrations, but Trump appears dead serious this time – stop buying Russian oil, or get caught in the crossfire. Hence, India, which has been unapologetic about its energy deals with Moscow, is in the direct line of fire. Russian crude now makes up around 35\u201337% of India\u2019s oil imports, more than from any other nation. For a country that\u2019s laser-focused on energy security and keeping inflation in check, that\u2019s not a relationship it can easily walk away from. India\u2019s refiners, both public sector giants like Indian Oil Corp and Bharat Petroleum, and private players like Reliance Industries, have been snapping up discounted barrels from Russia, helping to cushion<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"postBodyCss":"","postBodyMargin":[],"postBodyPadding":[],"postBodyBackground":{"backgroundType":"classic","gradient":""},"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[22],"tags":[106,107,108,109,110,111,112,113,114],"class_list":["post-520","post","type-post","status-publish","format-standard","hentry","category-blogs","tag-china","tag-donald-trump","tag-global-trade","tag-india-tariffs","tag-india-russia","tag-russian-oil","tag-trade-tariffs","tag-trumps-tariffs","tag-truth-social"],"_links":{"self":[{"href":"https:\/\/www.juniperoites.com\/financetonic\/wp-json\/wp\/v2\/posts\/520","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.juniperoites.com\/financetonic\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.juniperoites.com\/financetonic\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.juniperoites.com\/financetonic\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.juniperoites.com\/financetonic\/wp-json\/wp\/v2\/comments?post=520"}],"version-history":[{"count":0,"href":"https:\/\/www.juniperoites.com\/financetonic\/wp-json\/wp\/v2\/posts\/520\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.juniperoites.com\/financetonic\/wp-json\/wp\/v2\/media?parent=520"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.juniperoites.com\/financetonic\/wp-json\/wp\/v2\/categories?post=520"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.juniperoites.com\/financetonic\/wp-json\/wp\/v2\/tags?post=520"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
![\"Trump](\"https:\/\/media.assettype.com\/outlookindia\/2025-03-19\/fqxsj194\/seema120250401.jpg?auto=format%2Ccompress&fit=max&format=webp&w=768&dpr=1.0\")
<\/p>\n![\"Tariffs,](\"https:\/\/www.globaltimes.cn\/Portals\/0\/attachment\/2022\/2022-03-17\/98d85db5-2718-41a4-a863-e5b00ee2a214.jpeg\")
<\/p>\n