India-US Trade Deal: A Breakthrough or Cautious Step Forward?

Venture capitalist and Republican fundraiser Asha Jadeja Motwani said the deal was widely anticipated within Trump administration circles and described the outcome as a major success. "The trade deal was expected... there was a very clear sense that a trade deal was happening in February," she told IANS in an interview. She was surprised it came even sooner, she noted.

Jadeja Motwani said she was confident Prime Minister Modi would be open to restructuring India's energy sourcing. "I knew that Prime Minister Modi would be open to a trade deal that allows him to swap out oil from the Russian oil for US oil or US allied oil," she said, calling the resulting tariff outcome "absolutely as good as it gets."

She said Washington now views India as "pivotal," citing energy, defense, and technology cooperation, and asserted that the relationship is firmly back on track. "It is completely back on track... it's rock solid," she said, urging the private sector in both countries to move quickly on partnerships and commercial deals.

Former US Assistant Secretary of Commerce for Trade Development Raymond Vickery offered a more cautious assessment, arguing the agreement primarily halts a period of deterioration in ties. "The major import of the deal is to stop the downward spiral in US-India relations," he told IANS, attributing recent strain to tariffs, visa issues, and other disputes.

Vickery welcomed the tariff reduction "from the 25 to the 18 per cent" but stressed that critical details remain unknown. "Exactly what that covers and what it doesn't cover is not really known," he said, raising questions about claims that India had eliminated tariff and non-tariff barriers, particularly in sensitive sectors such as "agriculture, dairy... pulses and grain."

He also questioned headline figures cited by the administration, saying talk of $500 billion in additional purchases was "an extraordinary figure" given that annual bilateral trade currently stands at about $200 billion.

Rick Rossow, Chair on India and Emerging Asia Economics at the Center for Strategic and International Studies (CSIS), said the agreement follows a year in which trade proved unexpectedly resilient despite steep tariffs. "Despite the fact that we've had hefty tariffs in place against imports for most of 2025, trade has proven to be actually remarkably resilient," Rossow told IANS, noting that growth of "about 16 per cent over the last year," helped by exclusions including pharmaceuticals.

Rossow said there was "a bit of a slowdown in US-India trade in the closing months of the year," adding that Washington risked falling behind as India signed agreements with other partners. He described the current announcement as potentially a "first phase," saying it appeared to improve market access in India and restore US imports from India to "more normal" tariff levels.

Republican leader from Ohio, Niraj Antani, welcomed the deal as a decisive step forward. "I think it's a great day for US-India relations as we have struck a trade deal," he said, pointing to reciprocal tariff reductions and India's move to halt Russian oil purchases.

Antani said the reduction "right from 25 now down to 18 per cent" was central to India's interests and called the agreement mutually beneficial. "We want our two democracies to work together," he told IANS, adding that the deal ends a long-standing impasse that previous administrations had failed to resolve.

Indian-American entrepreneur Yogi Chug said the agreement marked a turning point for the diaspora business community. "For many of us in the Indian-American business community, today's agreement is a real breakthrough," he told IANS, calling it "a strategic win that deepens trust at a moment when global competition is only getting sharper."

India and the United States have spent years attempting to conclude a comprehensive trade framework, with negotiations repeatedly stalled by tariff disputes, market-access concerns, and political frictions. Despite those challenges, bilateral trade has continued to grow, reaching $ 200 billion.

The announcement comes as both countries seek to align economic cooperation with broader strategic priorities, including energy security, critical minerals, defense and advanced technologies, with further clarity expected once the full text of the agreement is released.

- IANS