Modi, Trump reaffirm friendship: Are tensions between India-US finally easing up?

The relationship between India and the United States is under intense scrutiny as leaders of both countries navigate one of the most turbulent periods in recent years.

While Prime Minister Narendra Modi and United States President Donald Trump have been pointing out their personal rapport, recent events have forced both countries to navigate one of the most turbulent periods in recent years.

How US escalated tensions with India

The latest point of friction came when Trump announced a sweeping new tariff package against Indian goods last month. The decision effectively doubled existing duties, raising tariffs to 50 per cent on a wide range of products shipped to the US.

This unprecedented move impacts more than half of India’s exports to its single largest trade partner and marks one of the most aggressive trade actions against New Delhi in over two decades.

The US administration framed the move as a direct response to India’s continued import of Russian crude oil, which Washington has opposed since the Russian invasion of Ukraine more than three years ago.

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Trump publicly criticised India for its energy purchases, accusing the country of undermining international sanctions aimed at Moscow.

His team went so far as to describe India as a “massive oil money laundromat for the Kremlin,” signalling the depth of his administration’s frustration.

How India responded with internal reform

Rather than retaliate with counter-tariffs or sharp rhetoric, New Delhi has focused on strengthening India’s domestic economy to absorb the external shock.

On September 22, the government will implement a landmark overhaul of the Goods and Services Tax (GST) system. The timing is deliberate, coinciding with the festive shopping season in India.

The revised GST framework introduces lower tax rates across numerous essential and discretionary goods — from automobiles to cooking oil — while simplifying tax compliance for businesses and speeding up refund processes.

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Officials describe this as one of the most comprehensive tax reforms since GST’s introduction in 2017.

By reducing household expenses and easing burdens on small enterprises, the Modi government hopes to boost domestic consumption.

This strategy leverages a unique structural advantage: private consumption accounts for roughly 61% of India’s GDP, significantly higher than export-reliant economies like Vietnam and China.

With exports comprising just 11 per cent of India’s GDP compared to Vietnam’s 85 per cent, New Delhi has greater room to offset external trade disruptions through internal demand.

How Modi’s SCO Summit turned Washington red

While trade tensions were escalating, Prime Minister Modi travelled to Tianjin, China, to attend the Shanghai Cooperation Organization (SCO) summit last week.

The event brought together over 20 leaders from non-Western nations, including Chinese President Xi Jinping and Russian President Vladimir Putin.

Images from the summit quickly spread across the West. Modi was seen clasping Putin’s hand and sharing animated exchanges with both Xi and Putin before the trio walked together for a group photograph.

These visuals circulated widely across international media platforms, with many interpreting the moment as a symbolic display of unity among three major powers seeking to challenge US dominance.

CNN political commentator Van Jones described the image as deeply unsettling for Americans. “We’re going to look back on today historically as a very big deal because that image of Xi Jinping with Putin, with Modi from India, with the leader of Iran, with the leader of North Korea, that should send a chill down the spine of every American,” he said.

Jones argued that the gathering represented the emergence of a “new world order” where the West finds itself increasingly isolated. “It was the United States and China together and Russia by itself. Now we’re on the bad end of the triangle. It’s everybody against us. That is not good for America,” he warned.

The New York Times echoed this view, observing that the friendly interactions between Xi and Putin underscored their shared vision of an alternative global order.

For India, the summit was as much about optics as policy. Analysts believe Modi’s engagement with Xi and Putin was carefully calibrated to remind the US that India has options.

How Trump reacted

Trump took to social media to express frustration, posting a photograph of Modi, Xi, and Putin together with the caption, “Looks like we’ve lost India and Russia to deepest, darkest, China. May they have a long and prosperous future together!”

However, Trump later sought to clarify his position during a press briefing at the White House on Friday. Speaking to reporters, he said he did not actually believe the US had “lost” India to China.

Instead, he voiced disappointment over India’s energy purchases from Russia, saying, “I’ve been very disappointed that India would be buying so much oil, as you know, from Russia. And I let them know that.”

The US president highlighted his personal friendship with Modi, attempting to reassure observers about the broader relationship.

“I’ll always be friends with Modi,” Trump said. “He’s a great prime minister. He’s great. I’ll always be friends, but I just don’t like what he’s doing at this particular moment. But India and the United States have a special relationship. There’s nothing to worry about. We just have moments on occasion.”

On trade negotiations, Trump said talks were progressing well with multiple partners globally, though he expressed frustration with the European Union over policies affecting major US technology companies.

How Modi responded to Trump

Modi responded publicly to Trump’s comments, posting on X to express appreciation for the US president’s remarks.

“Deeply appreciate and fully reciprocate President Trump’s sentiments and positive assessment of our ties. India and the US have a very positive and forward-looking Comprehensive and Global Strategic Partnership,” Modi wrote.

Deeply appreciate and fully reciprocate President Trump's sentiments and positive assessment of our ties.

India and the US have a very positive and forward-looking Comprehensive and Global Strategic Partnership.@realDonaldTrump @POTUS https://t.co/4hLo9wBpeF

— Narendra Modi (@narendramodi) September 6, 2025

External Affairs Minister S Jaishankar also weighed in.

Speaking to reporters, Jaishankar said, “PM Modi attaches enormous importance to our partnership with the US. Where President Trump is concerned, he has always had a very good personal equation with President Trump. But the point is that we remain engaged with the US, and at this time, I can’t say more than that.”

In response to US criticism of India’s Russian oil purchases, Jaishankar has previously been blunt.

He argued that it was contradictory for a pro-business American administration to accuse other nations of conducting legitimate business. “If you have a problem buying refined products from India, don’t buy them. Nobody is forcing you,” he said.

India also announced changes to its participation in the upcoming United Nations General Assembly (UNGA) session. According to the revised list of speakers released in New York, Modi will not deliver India’s address at the high-level debate later this month.

Instead, Jaishankar will represent the country and is scheduled to speak on September 27.

Also, Russian President Vladimir Putin is expected to visit India later this year.

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With inputs from agencies