U.S. Vice President JD Vance is set to begin a four-day official visit to India starting Monday, as both nations work to explore new economic opportunities and finalize a bilateral trade agreement.
Establishing a trade agreement between India and the U.S. stands to greatly enhance the economic connections between the two countries and could further solidify diplomatic relations.
The United States currently holds the title of India’s largest trading partner, with recent bilateral trade reaching approximately $190 billion.
India’s foreign ministry highlighted that Vance’s visit would allow both nations to “review the progress in bilateral relations” while enabling the leaders to “exchange views on regional and global developments of mutual interest.”
Bilateral trade agreement
The timing of Vance’s visit aligns with recent diplomatic exchanges, including a visit from Director of National Intelligence Tulsi Gabbard, who attended a geopolitical conference in India, and a meeting between Modi and Trump in Washington two months prior.
Modi has been proactive in establishing a rapport with Trump since his return to the White House, calling for a “mega partnership” and beginning discussions to mitigate the repercussions of Trump’s tariffs, having already reduced tariffs on selected U.S. imports.
Nonetheless, Trump has implemented a 26% tariff on certain goods from India under his previously paused tariff initiative, presenting temporary relief for Indian exporters.
During their last meeting, Modi expressed readiness to alleviate trade barriers further, noting potential reductions in tariffs on U.S. goods, the repatriation of undocumented Indian nationals, and a commitment to purchase military equipment. The two countries also agreed to initiate negotiations on the bilateral trade agreement.
On Friday, Modi mentioned a conversation with Elon Musk regarding the substantial opportunities for collaboration in technology and innovation, affirming India’s dedication to enhancing partnerships with the U.S.
India’s deep ties to US business
India’s partnership with the U.S. extends beyond trade, encompassing foreign direct investments and defense collaboration positioned to counter China’s growing influence in the Indo-Pacific region.
As a member of the Quad—composed of the U.S., India, Japan, and Australia—India plays a crucial role in efforts to balance China’s expansionism.
Prominent American corporations, including Apple and Google, have expanded their operations in India in recent years. Recently, Musk’s Starlink established agreements with two leading Indian telecoms to offer satellite internet services.
In a bid to bolster trade ties, the U.S. and India aim to increase their bilateral trade to over $500 billion by 2030 through the anticipated trade agreement.
The urgency of these negotiations is heightened for India, as it could face significant impacts from reciprocal tariffs imposed by Trump, particularly in key sectors like agriculture, auto components, medical equipment, and jewelry. This situation poses a formidable challenge for Modi’s administration, which is working to enhance the economy and create jobs through an export-led recovery.
Modi and Trump already share rapport
During Modi’s previous interactions with Trump, a strong working relationship was established, and indications suggest that both leaders are poised to intensify cooperation, especially given the challenges posed by Chinese President Xi Jinping’s trade ambitions in the Asia-Pacific region.
India has already committed to enhancing its purchases of oil, energy, and defense equipment from the U.S., including advanced fighter jets.
Despite this cooperation, the U.S. seeks greater access for its agricultural and dairy products within India’s market, an area in which New Delhi has remained cautious, considering the substantial number of citizens dependent on the agricultural sector.
Family trip for Vance
This marks Vance’s inaugural official trip to India, which carries additional personal significance for him as his wife, Usha Vance, is the daughter of South Indian immigrants and practices Hinduism.
In his memoir “Hillbilly Elegy,” Vance characterized his wife as a “supersmart daughter of Indian immigrants,” whom he first met at Yale Law School. Usha’s family immigrated to the U.S. in the late 1970s.
Accompanied by Usha, their children, and several senior U.S. officials, Vance plans to explore key Indian cities like Jaipur and Agra while engaging in activities at notable cultural sites, according to a White House briefing.
