Modi, Trump talk trade, defence as tensions ease
Modi said their talk was warm and engaging, reflecting a friendly exchange and mutual understanding during their renewed conversation.
Prime Minister Narendra Modi and US President Donald Trump held a telephone conversation on Thursday, a call that comes at a sensitive moment for India–US relations. After months of strain and escalating rhetoric, the two leaders appear to be trying to rebuild trust and preserve momentum in what has long been described as one of the world’s most consequential partnerships.
The phone call coincided with the conclusion of two days of intensive negotiations between Indian and American trade teams in New Delhi. These talks are aimed at finalising a long-pending bilateral trade agreement — a deal that has taken on new urgency after the Trump administration’s decision in August to raise tariffs on Indian exports to an unprecedented 50 per cent, with an additional 25 per cent duty specifically tied to India’s imports of Russian crude oil. For many Indian exporters, the agreement is now seen as the only viable path to significant tariff relief.
Soon after the call, Modi took to social media to describe the conversation as “warm and engaging” — a phrase intended to convey a sense of ease after months of tension. In his post, the Prime Minister said both sides reviewed progress in the bilateral relationship and exchanged views on major regional and global issues. He added that India and the United States would continue working together to promote global peace, stability and prosperity, though he stopped short of explicitly linking the discussion to the ongoing trade dispute.
Earlier this week, US Trade Representative Jamieson Greer hinted that progress was indeed being made. Though he declined to reveal specifics, Greer said the United States had received the “best ever” set of trade-related offers from India, raising cautious optimism that both sides may finally be inching toward a breakthrough. The last time Modi and Trump spoke was in October, underscoring the significance of this renewed engagement.
A period of strain
The past few months have tested the resilience of India–US ties. The decision by the Trump administration to double tariffs on Indian goods in August came as a shock, both for its scale and its political timing. It also compounded the burden on Indian exporters already grappling with global economic pressures. Additional duties on India’s purchase of Russian oil added a geopolitical layer to the economic strain, creating friction at a time when New Delhi had been diversifying its energy sources amid global volatility.
Beyond tariffs, Indian officials have privately expressed frustration over what they see as increasingly harsh public commentary from some senior figures in the Trump administration. These criticisms, ranging from trade practices to foreign policy decisions, had contributed to a chill in the relationship and were widely viewed as unnecessary and counterproductive.
Yet, in the last several weeks, both sides appear to have recognised the risks of allowing the situation to deteriorate further. Diplomatic engagements have intensified, and negotiators have been working around the clock to create a package acceptable to both governments. The latest phone call between Modi and Trump reflects this broader effort to steady the partnership.
Reaffirming cooperation
According to an official readout from New Delhi, Modi and Trump “reviewed the steady progress” made in India–US relations and reiterated their shared commitment to work closely on global challenges. The conversation reportedly covered a range of regional and geopolitical issues — a reminder that the relationship is not defined by trade alone, even if trade has dominated the headlines in recent months.
Both leaders emphasised the importance of advancing global peace and stability, a recurring theme in India–US strategic dialogue. This includes cooperation on the Indo-Pacific, counterterrorism, emerging technologies, and global supply chain resilience — all areas that have continued to see quiet progress despite the trade tensions.
The Russian oil question
One of the thorniest issues in the relationship has been India’s continued purchase of discounted Russian crude oil. The United States has long argued that revenue from these sales helps fund Russia’s war effort in Ukraine. India, however, has maintained that its energy purchases are driven by national interest, affordability, and the need to ensure stable supplies in a volatile global market.
Following the 2022 invasion of Ukraine, many Western nations sharply reduced their reliance on Russian oil. India, facing soaring global prices, turned to Russian supplies that were being offered at significant discounts. This helped ease domestic inflation and supported India’s post-pandemic economic recovery.
However, the landscape has shifted again in recent weeks. India’s imports of Russian crude have fallen, partly due to new American sanctions imposed on two major Russian oil companies. Whether this decline eases Washington’s concerns remains to be seen.
A cautious reset
For now, the warmth described by Modi suggests that both sides are trying to turn a page. There is still much work to be done — especially on the trade front — but the call may serve as a signal that India and the United States are committed to preventing temporary disagreements from overshadowing a relationship built over decades.
As negotiators continue their efforts, Thursday’s conversation offers a glimmer of optimism that the world’s two largest democracies can navigate their differences and keep their partnership on a forward course.