- The India–U.S. relationship since 1947 has not been a straight line but an irregular arc, evolving from early post-colonial distance and Cold War mistrust to strategic convergence after India’s 1990s liberalisation.
- The roughly 30-year period of sustained improvement in political trust, security cooperation, and economic interdependence from the late 1990s into the 2010s was unsettled by a series of unilateral U.S. trade measures or tariffs introduced by President Donald Trump.
- The 2025 tariff escalation argued by the U.S. administration, now being seen as the will of one man, is a tool to punish or dissuade certain energy trade patterns and to secure market advantages.
- India responded with export subsidies, stimulus to affected sectors, diversification of export markets, and accelerated moves to Southeast Asian and African customers.
After the end of the Second World War, one of the definitive outcomes was the decline of the British Empire and imperialism, the rise of the United States of America, and India’s independence. Even as the British worked out the formalities for Indian independence, the U.S. was closely observing India. However, the relationship between India and the United States since 1947 has not been a straight line but an irregular arc.
From an early post-colonial distance to Cold War mistrust, a slow thaw occurred after the 1980s, followed by a strategic convergence after the 1990s’ liberalisation, leading to deep, multidimensional ties across trade, technology, and defence by the early 21st century. That consolidation, a roughly 30-year period of sustained improvement in political trust, security cooperation, and economic interdependence stretching from the late 1990s into the 2010s, was unsettled by a series of unilateral U.S. trade measures or tariffs introduced by President Donald Trump.
The 2025 tariff escalation argued by the U.S. administration, now being seen as the will of one man, is a tool to punish or dissuade certain energy trade patterns and to secure market advantages, representing one of the most damaging single episodes to bilateral economic relations in decades and exposing tensions between strategic partnership and transactional economic policy. This essay is an attempt to look at the historical trajectory of the relationship between the world’s oldest democracy and the largest.
Post WWII: 1947–1971
August 15, 1947, marked the beginning of formal diplomatic relations between New Delhi and Washington, but immediate affinities were limited. The United States, shaped by the Truman-Eisenhower containment framework, prioritised alliances like NATO that could check the Soviet Union’s influence in Asia, but from the beginning, India chose a non-aligned path. However, economic ties existed in crucial U.S. aid in the early years, yet Cold War geopolitics and India’s insistence on strategic autonomy made the relationship awkward [1, 2].
The 1950s and 1960s saw several structural sources of distance. India refused to join military blocs and pursued an independent foreign policy underlined by the Non-Aligned Movement, seeing it as a medium to end colonialism. The U.S. increasingly courted Pakistan as a Cold War partner, a development that antagonised the Indian leadership elites and complicated bilateral trust. Food and technical assistance from the U.S. were important, but political alignment on key international crises remained distant as India often voted against the U.S at the United Nations [1, 3].
Relations hit rock bottom when the U.S supported Pakistan against India during the 1971 Indo-Pak war. The Nixon administration’s tilt toward Pakistan, including the deployment of the Task Force 74, led by the aircraft carrier USS Enterprise, into the Bay of Bengal, generated deep resentment in India and reinforced Indian perceptions of U.S. unreliability under geopolitical pressure. The fact is, the institutional memory of the threat of using nuclear weapons against India is still not forgotten, and this episode remains a defining low point in modern bilateral memory [4].
And that led to 1974, Operation Smiling Buddha. India’s first nuclear test was conducted because we believed we could not survive if we were not nuclear-capable. Washington imposed technology and nuclear constraints, and the episode introduced long-lasting sensitivities about non-proliferation policies and export controls that would crop up repeatedly in later decades [5].
The Start of Incremental Patchwork: 1980s and 1990s
The 1980s led to cautious openings, particularly under Prime Minister Rajiv Gandhi, who did not carry any political baggage, unlike his mother Indira Gandhi or his grandfather Jawaharlal Nehru. He initiated strategic dialogues, and limited technology cooperation grew under the twin pressures of shifting geopolitics as the world witnessed the slow decline of the Soviet Union and India’s own evolving needs.
With a sizable section of the population born after independence, aspiring for change, India took the necessary step and changed course. The end of the Cold War culminated with India’s economic crisis of 1991, which catalysed New Delhi’s liberalisation and created incentives for deeper engagement with Western markets and capital [6]. India was now seen less as a potential rival and more as a large, democratic partner in Asia with tremendous economic opportunities.
But all that ended after India conducted a series of nuclear tests in 1998. The Pokhran II tests again caused a rift, resulting in Western sanctions, but surprisingly, the rupture was brief, and both sides eventually found a pathway back. The actions from both sides ensured there was no reason to permanently break ties, but instead build cooperative architectures that reconciled non-proliferation concerns with longer-term strategic and commercial interests [7].
Trump’s tariff escalation represents one of the most damaging single episodes to bilateral economic relations in decades, exposing tensions between strategic partnership and transactional economic policy.
Strategic Convergence: 2000s and 2010s
Post 9/11 counterterrorism concerns brought Indian and U.S. security priorities into closer alignment and opened opportunities for defence cooperation. The 9/11 terror attack on U.S. soil was an awakening and a reminder that no country was impervious to Islamic terrorism. Under the Prime Ministership of Dr Manmohan Singh, the landmark civil nuclear cooperation agreement was reached. The George W. Bush administration and its implementation in the late 2000s signalled a concrete, institutionalised trust that many had once thought impossible; India was effectively integrated into parts of the global civil nuclear order without abandoning its strategic autonomy [8].
Throughout the 2000s and 2010s, bilateral engagement diversified with high-level visits by the US administration, joint military exercises, intelligence and technology partnerships, cooperation on counterterrorism, and stronger people-to-people links, which grew. The Obama administration’s outreach framed India as a central partner in a broader geopolitical balancing architecture in the Indo-Pacific. Economic ties also expanded: trade, investment, and technology flows deepened, with the United States becoming one of India’s largest trading and investment partners [9, 10]. Policy instruments such as the “Major Defence Partner” designation and inclusion in multilateral export control discussions marked a qualitative improvement in defence and diplomatic trust in this era [11].
The late 1990s through the 2010s represented the high-water mark of institutional trust and complementary strategic purpose. India was finally seen as a democratic nation with strong institutions that could handle change. But the key was the growing market size and strategic location of India, and that was seen as the pivot of U.S. global interests to Asia and India as its subcontinental partner, economic and security partner.
Economic Interdependence
Economic ties grew in scale, never witnessed before. U.S. firms invested heavily in Indian IT, pharmaceuticals, gems and jewellery, textiles, and services. Bilateral trade, including goods and services, expanded markedly through the 2000s and 2010s, even as trade imbalances and occasional market access disputes persisted [9,12]. India was the destination for the U.S., which remained a source of technology, capital, and high-value services.
Though frictions emerged, the institutional agreements were strong enough to correct policy mismatches and differing regulatory regimes. Both nations were able to solve disputes and concerns about market access because they were adept at compartmentalising these tensions. Trade disagreements were usually handled diplomatically, with professional trade negotiators striving to avoid endangering broader strategic cooperation.
Trump 1.0 & MAGA: 2017–2020
The first Trump administration (2017–2020) introduced a distinctive economic nationalism in U.S. trade policy, which was also his campaign promise. Trump saw tariffs as a unilateral tool, which was a leading cause of scepticism toward multilateral mechanisms. For India, symbolic blows included the 2019 termination of India’s Generalised System of Preferences (GSP) benefits, which removed preferential access for several Indian exports and signalled an abrupt shift in economic engagement [13]. The U.S. also applied steel and aluminium tariffs that prompted Indian retaliatory measures.
These episodes exposed the vulnerability of trade dimensions to unilateral changes in U.S. policy. But the broader strategic relationship survived, driven by convergent security interests. However, Indian policymakers began to register the risk that strategic rapprochement might not insulate them from transactional economic coercion [14].
India’s response highlights a reassessment of strategic alignment while maintaining greater autonomy in economically sensitive areas.
Trump 2.0 & MAGA on Steroids: The Tariff Crisis of 2025
After winning a historic re-election, Trump made it clear that the U.S. was not treated fairly, and his administration announced a sweeping set of tariffs. India expected some windfall, but the sudden announcement of a 25% supplementary tariff on a wide range of Indian goods was not expected. Shortly afterwards, the administration escalated duties on select items to an effective 50%, citing national security considerations and energy trade practices in particular, India’s continuing purchases of Russian oil amid complex global energy politics. But what one must realise is that it was the U.S. that asked India to buy Russian oil to ensure stability of the global oil price. The measures were rapid, broadly targeted at labour-intensive sectors (textiles, gems & jewellery, some auto components) and threatened to hit major export sectors hard while exempting others such as certain pharma and electronics lines [15–18].
Trump wants to protect U.S. manufacturing, punish unfavourable trade patterns, and coerce market behaviour (dissuade India from purchasing Russian energy). The tariffs were also consistent with a broader strategy of using trade levers for rapid diplomatic signalling and pressure rather than long negotiations [16,19]. Domestically, the narrative has resonated with Trump’s protectionist constituencies in the U.S., even as many economists and business groups warned of higher consumer costs and disrupted supply chains.
The tariffs’ immediate impact has affected Indian exporters. Industry groups reported sudden order cancellations, price competitiveness erosion versus rivals such as Vietnam and Bangladesh, and supply-chain disruptions. Indian hubs for garments, jewellery, and small engineering goods signalled sharp revenue losses and potential job dislocations. Financial markets and investor sentiment were dented as well, with capital flows and share prices reacting to uncertainty [17,20].
The tariffs triggered consequential diplomatic reactions. New Delhi protested the unilateral move; India temporarily paused or reconsidered some defence procurement plans involving U.S. vendors, demonstrating that economic coercion could spill over into the security relationship. Congressional critics in the U.S. also worried that such tariffs undermined the strategic objectives that had been painstakingly cultivated over decades; that is, using tariffs to gain short-term leverage risked eroding the long-term strategic architecture [15,21].
Right now, there are legal challenges in U.S. courts that are questioning the executive’s tariff authority; in some instances, judicial pushback has slowed enforcement. Nevertheless, the reputational damage had occurred: an alliance partially grounded in trust and predictability now had a notable gap in its economic pillar.
Has the Tariff Move Broken the 25-Year Consolidation?
India has responded like a responsible power with immediate mitigation: export subsidies, stimulus to affected sectors, and a push to diversify export markets and has accelerated moves to Southeast Asian and African customers and restructured supply chains to reduce U.S. exposure. Longer term, the tariff episode prompted Indian policymakers to renew emphases on self-reliance (Atmanirbhar initiatives), capacity building, and a more proactive commercial diplomacy to broaden market linkages [17,22].
While Delhi acknowledged the strategic value of partnership with the U.S, this forced tariff is a painful wakeup call and a deep reassessment of the India–U.S. relationship. In short, strategic alignment continued where interests converged, but India will never compromise its greater autonomy in areas where it felt economically vulnerable, i.e., allowing U.S. agro products to enter India.
The precedent of using tariffs for geopolitical leverage worried many global actors, particularly small nations that are economically vulnerable. But other middle powers have taken note: if large democracies could weaponise tariffs, multilateral reliability could be eroded. It was a reminder of gunboat diplomacy. The episode strengthened arguments for rules-based dispute settlement, but it also highlighted the limitations of existing institutions to rapidly redress politically motivated tariffs [19].
The India–U.S. relationship since 1947 has not been a smooth journey. It has been 75 years of an evolving narrative of mistrust, pragmatic convergence, and partnership tested by crises. The roughly 25-year period of deepening strategic and commercial ties was remarkable for its breadth and depth. Yet the tariff episodes initiated under the Trump administration revealed an uncomfortable truth: strategic affinity does not automatically immunise economic relations. The 2025 tariffs are particularly consequential because it is seen from the prism of combined economic coercion with geopolitical aims, producing rapid and painful shocks to Indian exporters and a potential diplomatic fallout that could affect other areas of cooperation.
References:
- https://history.state.gov/historicaldocuments/frus1947v03/ch4subch3
- https://history.state.gov/countries/india
- FRUS/Archival materials https://history.state.gov/historicaldocuments/frus1947v03/d104
- “1971: The Crisis and the U.S. Tilt” — Historical coverage of U.S. policy during the Indo-Pakistan war. https://history.state.gov.
- Subrahmanyam S. India’s 1974 nuclear test and international reaction. (Historical summaries).
- Brookings Institution. India-U.S.: Looking back — highs, lows, and steady progress. Published 2016. https://www.brookings.edu/articles/india-u-s-looking-back-highs-lows-and-steady-progress/.
- “Pokhran II and sanctions” — commentary and analysis of the 1998 tests and subsequent sanctions.
- U.S.-India Civil Nuclear Cooperation: Department of State and policy archives. (Background on 2005–2008 cooperation).
- https://www.cfr.org/timeline/us-india-relations
- https://www.brookings.edu/articles/india-u-s-relations-in-16-charts-and-graphics/
- https://en.wikipedia.org/wiki/India%E2%80%93United_States_relations
- https://www.orfonline.org/research/understanding-the-impact-of-gsp-withdrawal-on-indias-top-exports-to-the-us
- Office of the U.S. Trade Representative (USTR). United States Will Terminate GSP Designation of India and Turkey. March 4, 2019. https://ustr.gov/about-us/policy-offices/press-office/press-releases/2019/march/united-states-will-terminate-gsp.
- https://www.piie.com/blogs/trade-and-investment-policy-watch/trumps-mini-trade-war-india
- https://www.reuters.com/world/india/trump-imposes-additional-25-tariff-indian-goods-relations-hit-new-low-2025-08-06/
- https://www.ft.com/content/d2f52819-db79-4cb9-a4f0-43820643cda1
- https://www.reuters.com/world/india/indian-textiles-jewellery-risk-50-trump-tariffs-pharma-phones-exempt-2025-08-08/
- https://www.theguardian.com/world/2025/aug/07/modi-ready-to-pay-a-heavy-price-as-india-seeks-to-resist-trump-tariffs.
- Financial Times. How Trump has turned tariffs into diplomatic shakedowns — analysis of global implications. https://www.ft.com/content/791b84a5-7e6c-4e44-a2af-7e59ebbe4c7d.
- Reuters. Trump’s 50% tariffs could derail India’s manufacturing goals, Moody’s says. Aug 8, 2025. https://www.reuters.com/world/india/trumps-50-tariffs-could-derail-indias-manufacturing-goals-moodys-says-2025-08-08/.
- Economic Times. “Trump’s ‘tariff tantrum’ could undo years of US-India diplomacy” — reporting on U.S. congressional concerns. https://economictimes.indiatimes.com/news/india/trumps-tariffs-risk-carefully-built-us-india-partnership-us-senator-says/articleshow/123180869.cms.
- Reuters. India braces for a hit to $64 billion in US exports amid rising tensions. https://www.reuters.com/world/india/india-braces-hit-64-billion-us-exports-amid-rising-tensions-with-washington-2025-08-06/.
Balaji is a freelance writer with an MA in History and Political science and has published articles on defence and strategic affairs and book reviews. He tweets @LaxmanShriram78. Views expressed are the author’s own.
Divyanka Tandon 
Diksha Bharti 
Dhruv Ashok
👏🏻👏🏻