Why have relations between Trump and Modi nosedived so quickly? | Inside Story

0:01 The US has imposed a punitive 25% tariff on India. President Trump warns more could follow. It's a spectacular change from 6 months ago when the leaders of the two nations declared their friendship at the White House. So, what went wrong and what next? This is Inside Story. Hello and welcome to the program. I'm Darin Abbuga. A great friend said US President Donald Trump of India's Prime Minister Narendra Modi back in February. Modi was one of the first international

0:48 leaders to visit him at the White House just weeks into his second term. But six months on, their strong bond appears to have ruptured. Trump is imposing 25% tariffs on goods imported from India. And describing the Indian economy as dead, he says more harsh measures could be on the way because India buys oil from Russia. But unlike most other world leaders targeted in Trump's sweeping tariffs, Modi is standing firm. Indian officials say they'll continue to purchase Russian energy despite Trump's threats. So why have relations between the one-time close allies nosedived so quickly? What are the consequences? And can the rift be healed? We'll get to our

1:34 guests in a moment. First, this report from Katya Lopez Huran. The great Indo-American friendship. It was a friendship that once had the promise of a strong political alliance. US President Donald Trump and Indian Prime Minister Narendra Modi both known as populist leaders. But now there's a shift in tone with Trump and his administration accusing India of financing Russia's war in Ukraine. It is not acceptable for India to continue financing this war by purchasing the oil from Russia. People will be shocked to learn that India is basically tied with China in purchasing Russian oil. That's an astonishing fact.

2:21 India purchases about a third of its oil from Russia. Government leaders say they will continue to do so despite threats of additional penalties from the US and that's on top of Trump's 25% tariffs on Indian exports. India is a major major source of um generic drugs especially for the United States and so in addition to the 25% tariff there are also rumors of an additional tariff on pharmaceuticals. Now many in India are questioning if Modi miscalculated his ties and friendship with Trump. It's a huge political setback for him and he called Mr. Trump my friend. you know the very close friends and even Mr. Trump says my good friend Mr. Modi. So

3:08 this is what one friend has done to the other friend. We missed you. We missed you a lot. A geopolitical fallout is at risk. Trump's policies, critics say, could push New Delhi closer to Moscow and Beijing. Each along with Brazil are founding members of the BRICS group of nations. You know, they have bricks which is basically a group of countries that are anti- the United States and India is a member of that if you can believe it. It's an attack on the dollar and we're not going to let anybody attack the dollar. Modi has remained defiant though not mentioning him by name. He dismissed Trump's claims that he managed to broker a ceasefire deal between India and Pakistan in May.

3:55 [Music] No world leader asked us to stop the operation. [Applause] [Music] It was Pakistan that pleaded over a call with India's director general of military operations to stop fighting after feeling the heat of our attacks. Washington's tariffs on India mark a new chapter in their trade relationship with many waiting to see the impact it will have politically and economically for both countries. Katia Lopean Al Jazzer for Insight story.

4:40 Let's now bring in our guest. Joining us from New Delhi, we have Brahma Chilani who's a professor of strategic studies at the Center for Policy Research. He's also a former adviser to India's National Security Council. Joining us in Washington DC is Elizabeth Thrrell, a senior fellow and director of the South Asia program at the Stimson Center. and in Kolkata, Sumantra Bose, political scientist and professor of international and comparative politics at Korea University in India. Thanks for your time. Welcome to you all uh to Inside Story. Elizabeth, I'll start with you. Some in the Indian media are reporting this. Trump's move is less about trade policy and more about leverage. It's a pressure tactic. Is that how you view what's happening right now? And what do you think Trump is

5:26 hoping to achieve with the 25% tariff? You know, I think it's important to zoom out and see this in the broader context. Obviously, uh if you're sitting in Delhi, then that is the main story uh of this tariff push, but obviously this is something that is impacting countries around the world. Uh we've seen a few deals that have come out in recent weeks, but this is something that is impacting a broad swath of countries. And I would actually read it more in terms of how uh the Trump administration is seeking to rebalance their priorities under this administration. So far, we've seen a greater focus on domestic politics on trade as a way of uh beefing

6:13 up US economic security. And I think that is a new push and a new angle to a US India relationship that here before has been dominated more by uh aligned security concerns. You know whether this is a tactic whether this is a broader strategy I think time will tell. Uh but so far you know this is not a I'm not seeing signals from the White House from the administration that they are looking to back down. In fact, the the rhetoric seems to be escalating as you played that tape from uh Steven Miller, for example, over the weekend. So, I think we're in for a continued rough patch at least uh for the weeks and perhaps months to come. So, Mantra, how big a deal is this in

7:00 India and how damaging are these tariffs likely to be? uh well in India uh this tiff is probably going to be largely seen as a question of national pride and the national interest. Uh a couple of days ago uh Prime Minister Modi who often maintains uh strategic silence on various matters spoke up on the tiff and he said that his top priority as prime minister is to protect the interests of Indians specifically Indian farmers, Indian small businesses and entrepreneurs and uh the huge youth

7:46 bulge among whom there is a massive unemployment problem. Uh I should mention that uh long predating Trump uh the United States has put pressure on India to open up its uh farm and dairy sectors and also its retail sector and it hasn't happened to the extent that the United States would have liked. So this point of friction or tension in fact predates the Trump administration. The big difference is that no previous US president or administration has done it in such a blunt and uh univil way as uh this one. I fear it's going to get the backs of a lot of Indians up and

8:35 enable noi to play to the domestic gallery to pose as the champion of India and specifically the champion of Indian farmers. most Indians are still engaged in agriculture and uh the little man the small shopkeepers trailers and so on. So it's a big deal. Mhm. Okay. You raised some interesting points. I'll be coming back to some of them but Brahma over to you. How do you think India will be able to balance this right? The need to stand firm against US pressure but at the same time it may risk losing a key export market. The striking irony over the US India tensions is that Modi has come to be

9:21 seen as India's most pro- US prime minister ever. While clinging to the country's traditionally independent approach to international affairs, Modi's foreign policy has betrayed a not so subtle pro-western tilt. So it's very ironical that that on his watch there are these new tensions with Washington. In fact, the new strengths and ties with Washington are reinforcing India's imperative for better balance and greater maneuverability in foreign policy as a hedge against American unpredictability. This may well explain recent efforts by India to ease its Himalayan military tensions with China. Modi is scheduled

10:07 to visit China this month end for talks with Xiinping on the sidelines of a summit of the Shanghai Cooperation Organization. So by impelling India to seek a thaw with Beijing as a hedge against American unpredictability, Washington is compounding its blunder in helping to drive Russia and China closer together in an unholy alliance. But I think Trump's personal rapport with Modi offers some hope that the US and India may be able to overcome their current disputes and differences to revitalize ties. Trump, as we all know, has a reputation of being a wy businessman who seeks to

10:54 drive a hard bargain. He has weaponized tariffs to advance not just US economic interests but also geopolitical objectives. And this is very clear. But hang on a second, Brahma. Look, speaking of personal rapport, you bring it up, right? Speaking of personal rapport, what about Modi? Did he overinvest in in one man that is Trump rather than the broader US relationship? I think personal chemistry between um world leaders is very important in uh in promoting intercountry relations. So I think the Trump Modi connection was was very helpful. For example, in in Trump's first term, US India relations thrived. They thrived in large part because of the Trump Modi connection. This time,

11:42 Trump has returned to the White House with a different agenda and different mindset. He, you know, for first we are seeing this return of the with us or against approach in US foreign policy. And we should not forget that the Trump administration is targeting not just India. It's targeting other independent powers and leading democracies of the global south including Brazil and South Africa. So Brazil, India and South Africa, all members of break are among the prime targets of the Trump administration. The irony is that Brazil, India and South Africa are the three powers and bricks that are ensuring that bricks does not

12:27 develop an anti-western orientation. So Trump's heavy-handed attempts to pressure these countries are destined to fail because each of them we have seen how Brazil has stood up to Washington, South Africa too has stood up to Washington and India will not wilt under Washington's coercion and I think those in in in the Trump administration who believe that they can pressure India into doing things that India has always been opposed to. They they are mistaken. in fact will only harden India's position. Elizabeth, does this hurt Trump politically within the US? The fact that he seems to be alienating India, which has been a key strategic partner, is

13:15 this seen as a risky move amongst some in Washington? Uh I think certainly those of us who pay attention to uh the US security landscape uh and broader geopolitics are watching this with a mix of of interest and concern but actually in a bit of a mirror to the dynamics that were described on the Indian side in terms of domestic politics. Right? This is very much the Trump administration seeking to demonstrate how Trump himself and Washington are working for the interests of the American people. uh and the narrative that is I think playing fairly effectively with Trump's base in

14:02 particular is that uh the US has been taken advantage of by freed writers in the international system and that Trump needs to leverage his ability to make deals and to push a hard bargain uh in order to get a better deal for the American people. Of course, the actual impact of tariffs and the extent to which they will operate as taxes that are passed on to the American consumer complicates that narrative, right? But in terms of the story that Trump is able to tell, I think it is a very much in line with his populist image here at home. And so putting those two together, we have two

14:48 populist leaders who for this point at least are leaning into their credentials and to defending the interests of their people as they see it. So mantra from Delhi standpoint, is Trump still seen as a viable long-term partner or is India recalibrating its strategy? Is it going to push India further towards Russia and China as as Brah Brahma seemed to suggest earlier on? Uh well, no Indian government can afford to alienate the United States which is after all for better or for worse the single most important and powerful country in the world. Uh but I should point out that the improved United States India relationship is of fairly

15:35 recent origin. It's a development of this century and probably the initial turning point was a state visit by then President Bill Clinton to India in March of 2000. Uh in fact uh India's uh all-w weather ally more or less uh has always been Russia or rather the Soviet Union. uh India pursued a foreign policy based on a strategic doctrine called non-alignment from the 1960s through the end of the 1980s beginning of the 1990s and this involved um trying to be a leader of the third world as the global south was known then and avoiding

16:21 getting overly aligned with or tied to either of the superpower blocks. Of course in the 70s and 80s India was strongly tilted towards the Soviet Union but non-alignment still remained the cornerstone of its uh the declaratory cornerstone of its foreign policy. Now since the early to mid 1990s the old term non-alignment which did not make a great deal of sense probably back then and certainly not since the end of the bipolar world has been replaced by another term called strategic autonomy. And that commitment to strategic autonomy in foreign policy has really not changed that much not drastically or very significantly under the Modi

17:07 premiership of the last 11 years. So in answer to your question uh India has always hedged its bets and tried to spread its risks. In the 4-day war in May with uh Pakistan, uh Sukhoy and Rafale jets were used. The Brahos supersonic missile was apparently used and that is a Russian Indian collaboration, right? And uh the S400 uh Russian uh uh system, the air defense system played a critical defensive part in uh Indian strategy. And if you look at India's oil imports, uh at the moment uh the top five suppliers are in this order, uh Russia, Iraq, um Saudi Arabia, the United States

17:55 and Iran. So this is nothing new for India to try and have a balanced foreign policy. Okay, hang on a second. Hang on a second. Okay, on that point you make about Russian oil. Brahma, I'll ask you. So Trump, as we heard, is demanding that India stop buying Russian oil, something that India has said that it will not do. Is India's stance on Russian oil right now transactional or does it indicate a deeper alignment with Russia? Trump's focus on Russian oil reflects both his frustration with Putin for not accepting a ceasefire at a time when the West is staring at a possible defeat in the Ukraine war. That's the reason why Trump has stepped up pressure on India

18:42 and China. China has already rebuffed Trump's pressure. But Trump's second motive is to use Indian purchases of Russian oil as a negotiating tactic. He wants India to ditch Russian oil in favor of more American oil. In his first term, Trump by imposing sanctions on Iran deprived India of cheaper Iranian oil, thereby turning India into a major and growing market for US crude and LG exports. Since 2019, since he imposed sanctions on Iran, American crude and LG exports have risen quite dramatically. Now in his second term, by exerting pressure on New Delhi

19:29 to stop buying Russian oil, Trump would like India to actually become the largest buyer of US energy products. But there is an important difference. Unlike Iranian oil, Russian oil is not subject to direct US sanctions. That difference is the reason why New Delhi is less willing to yield this time. Even so, India is seeking to pleate Trump by significantly increasing imports of high higher priced American crude. According to one report, Indian imports of US oil are likely to go up by 150% in the current fiscal year. So, India is

20:14 and who is reporting this and and who is reporting this? If I may ask you, this is according to you know Indian officials reported in today's newspapers. Okay. that um that in the in the in the first 6 months of this year since Trump took office, Indian imports of American oil have risen by more than 50% according to these news reports and that in the full year they're going to go up by 150%. So India is ramping up uh in a very significant manner imports of Russian or sorry imports of American oil and LNG. Okay. So India is trying to do both things. stick to its um traditional partner Russia while also trying to pleate Washington. Okay. Um look, we were mentioning the Ukraine war just a moment ago,

21:01 Elizabeth. So it seems like there are a number of differences on the political front, right? There's the Ukraine war, then the most recent being of course that IndiaPakistan ceasefire with Trump claiming multiple times that India and Pakistan had agreed to a ceasefire thanks to US mediation. We know that Indian officials including Modi have come out and said no that's absolutely not correct. To what extent has that been a contributing factor to the recent deterioration of the relationship? You know, I think this is a significant factor in some ways because the India Pakistan relationship uh is so politically sensitive within uh New Delhi especially among Mod's political base and to have the Trump uh you know

21:49 multiple times not just on one occasion but over 25 at this point uh to have President Trump come out and uh say publicly that he played a key decisive role in bringing about a ceasefire uh that every time it happens is like a pin prick in both the US India relationship but also in continuing to push this narrative. And so I think we're in this an interesting moment right now where the Trump administration truly seems to be pursuing a dehyenated relationship between India and Pakistan in some ways. Right? We're talking more about trade with India uh some continued defense cooperation which we should still get to right that is also a pillar of this relationship but things are moving

22:36 forward with Pakistan in a way that truly we haven't seen and I think many in India will have become more accustomed to the approach that the Biden administration took for example where there was a very very low level of USPakistan ties particularly in the aftermath of the uh US withdrawal from Afghanistan and so as we're seeing that US Pakistan relationship uh really get wind in its sales at a time when the US India partnership uh is on rockier ground. It is particularly challenging from the perspective of policy makers in New Delhi. uh when it it just seems as if uh the US and Washington are kind of finding a a variety of different ways to complicate things especially politically

23:23 on the domestic political front for uh Prime Minister Modi since this has gained traction uh among opposition parties in in India. So Mantra is there a back path back to cooperation or do you think this relationship has fundamentally shifted? I don't think the relationship has fundamentally shifted. Uh you know, first of all, uh Trump is so unpredictable and erratic. Uh what he says today, he may be saying the opposite thing or something close to the opposite thing tomorrow. Uh what he wants today uh may not be uh what he wants tomorrow. Uh I think there is more to his uh uh bullying uh posturing than meets the eye. uh he clearly wants India

24:09 to buy more American oil and more American weapon systems which he keeps boasting are the best in the world and so on. Um at the same time I think Modi has limited room for maneuver uh because he has you know coed up to Trump uh in in the past uh as has already been mentioned. I think Trump is irritated with India and also with Modi personally. Um most recently because the Indians have been refusing to give him credit for bringing about the cessation of the IndiaPakistan armed conflict that he believes to be uh his. Uh but also uh last year uh when Modi was visiting the United States, he was supposed to call

24:54 on Trump when Trump was running for his second term and he ultimately did not do so. And uh Trump as we all know operates a lot on the basis of personal grudges and grievances. Uh but Modi is in a tight spot because um he cannot be seen to be caving in and capsulating to American uh bullying and this borish behavior of of Trump. Uh on the other hand, he probably knows that he will have to make some concessions if this stiff is going to be sorted out to mutual satisfaction. Do you agree? Is Modi in a tight spot? I mean, who who loses more from this rupture? Is it Trump who may damage US interests in Asia? Is it Modi who who perhaps looks

25:39 um like he's being sidelined? And and do organizations like Bricks come out on top, the ones that challenge US global dominance? India is the only Asian economy that trades more with the US than with China. And the US India partnership is pivotal to maintaining the balance of power in the Indo-Pacific. If the US wishes to generally pivot to Asia, which has been the American goal since 2011, but the US has never generally pivoted to Asia. But if it wants to pivot to Asia, it must improve relations with India. It has no other choice. In fact, if the US wishes to prevail in its escalating rivalry with China, it needs India more than ever.

26:25 But without mutual respect, this bilateral relationship is doomed. So the issue is about mutual respect and mutual trust. We were talking about Trump's claim to have brokered a ceasefire between India and Pakistan. But we are overlooking one key element in the new US Pakistan love affair which is Pakistan's major investment in the Trump family controlled world liberty financial a crypto firm. In April, Pakistan made a major investment in world liberty financial and suddenly

27:10 since then there has been a sea change in Trump's attitude towards Pakistan. Clearly there is a personal gain element involved. The crypto business of Trump family is clearly influencing American foreign policy and that's an unfortunate element which we should not ignore. Okay, we will have to leave it there. On that note, thank you so much to all my guests for joining us. Brahma Chalani, thank you. Elizabeth Thrill and Sumant Trabos, we appreciate your time. Thank you for watching. You can see the program again anytime by visiting our website aljazer.com. For further discussion, go to our Facebook page. That's facebook.com/jainsightstory.

27:56 You can join the conversation on X. Our handle is AJ Insightstory. from myself and the whole team here in DHA. Thanks for watching and bye-bye for now. [Music] Don't miss out to get the full picture. Subscribe to Aazer for reliable news and expert insights. Like, share. Stay ahead.