Trump message to New Delhi as Trade talks Progress: Bend or be Broken

 

By K Raveendran

The Trump administration’s twin-pronged approach to force India into granting greater trade concessions marks a new and particularly aggressive phase in the ongoing trade talks. It combines the threat of punitive economic measures with geopolitical pressure, making the situation deeply precarious for New Delhi. At the centre of this development is a stark warning: comply, or pay—literally. On one front, President Trump is pushing the envelope in the trade negotiations by treating India’s domestic market as already open for American companies while simultaneously preparing to slam Indian pharmaceutical exports with an astronomical 200 percent tariff. On the other, Washington has signalled its displeasure over India’s ongoing trade ties with Russia, especially in the energy sector, and now appears to be using NATO’s voice to amplify that pressure. The message is unmistakably clear: bend or be broken.

For India, the pharmaceutical sector is not only a significant contributor to its exports but also a source of global influence and soft power. Indian pharmaceutical companies are indispensable to the American healthcare system, supplying nearly half—about 47 percent—of all generic drug prescriptions in the US. Moreover, India accounts for 15 percent of US biosimilar imports, which are crucial for patients who depend on affordable alternatives to biologic therapies. Indian pharma exports to the US have reached a staggering $8.7 billion, making it the single largest market for Indian drug makers. These numbers are not just impressive statistics—they represent lives saved, healthcare systems stabilized, and a decade-long ecosystem of trust built between regulatory agencies, manufacturers, and end users. That Trump could so casually place this lifeline under threat with the looming spectre of 200 percent tariffs shows the degree of leverage he believes he can extract.

The very idea of such a tariff carries multiple implications. It threatens to significantly raise the cost of generic medicine in the US, which could cripple access to affordable treatments, especially for low-income populations and patients dependent on long-term therapies. It would force American importers to look elsewhere—if alternatives exist at all—and disrupt the supply chains that have been painstakingly built over the years. More crucially for India, this could deliver a body blow to a sector that has not only been one of the bright spots in its export basket but has also played a vital role in public health diplomacy. From COVID-19 vaccines to anti-retroviral therapies for Africa, Indian pharmaceuticals have been global equalizers. A targeted strike by the US would destabilize that narrative.

Trump’s posture is particularly troubling because it goes beyond the standard norms of hard-nosed trade negotiation. His administration appears to assume that simply by threatening damage, it can reshape the contours of Indian economic and strategic policy. This assumption misreads both the complexity of Indian domestic politics and the structural imperatives that govern its trade relationships. India has consistently resisted making disproportionate concessions to any single partner, including the US, even during periods of geopolitical alignment. Trump, however, seems to expect not parity, but submission—an expectation born perhaps of a businessman’s worldview where all relationships are transactional and leverage must be absolute.

In parallel to the economic squeeze, the geopolitical vice is tightening. NATO Secretary General Mark Rutte’s stern warning to India, China, and Brazil regarding continued trade with Russia marks an unusual moment in international diplomacy. The message, though ostensibly from NATO, clearly has Washington’s fingerprints all over it. The United States, especially under Trump, has shown a proclivity for using multilateral forums and alliances as megaphones for bilateral interests. The warning is particularly aimed at India’s oil imports from Russia, which have grown since the beginning of the Ukraine war. India’s rationale has remained consistent: it needs to secure affordable energy to ensure economic stability and energy security for its 1.4 billion people. Previous American administrations, even when they disapproved, grudgingly accepted this reasoning, acknowledging India’s unique position and the fine balance it must maintain in global politics.

But Trump is not bound by such precedents. He sees norms and conventions as optional, diplomacy as a game of brinkmanship. His administration treats global interdependence not as a web of shared interests, but as a system to be gamed. In this worldview, India’s attempt to follow a strategic path of autonomy—buying oil from Russia while staying engaged with the West—is seen not as pragmatism, but as disloyalty. And so the pressure mounts, with economic threats on one hand and geopolitical isolation on the other.

For New Delhi, this situation presents an uncomfortable recalibration. The threat to pharmaceutical exports and the pressure on energy imports are not separate events—they are part of a deliberate strategy to corner India into giving the US what it wants, possibly in the form of broader market access for American agriculture, technology, and manufacturing. But such an approach underestimates India’s political resilience and overestimates the benefits of coercion. Historically, India has responded to pressure not with capitulation, but with hedging, diversification, and strategic pushback. The Trump administration might discover, belatedly, that turning India into a pressure point yields diminishing returns.

India, for its part, faces hard choices but is not without tools. The pharmaceutical threat, though grave, may be mitigated by leveraging international support and reminding American policymakers and patients alike that they stand to suffer just as much, if not more. Moreover, India can use its diplomatic channels to directly engage with more sympathetic US lawmakers, healthcare groups, and patient advocates who understand the role Indian drugs play in American lives. On the oil front, India could diversify its supplier base marginally, increase purchases from US or Middle Eastern sources when possible, while continuing to argue—publicly and forcefully—that its decisions are rooted in energy security, not geopolitics. (IPA Service)

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