By T N Ashok
NEW YORK: Washington’s effort to conclude a series of trade agreements before January 3 has acquired fresh urgency following the Republican defeat in the November 3 midterm elections. An agreement with Narendra Modi could become one of Donald Trump’s most important economic and diplomatic achievements of the year, but the Russian oil question, market access and India’s strategic autonomy remain formidable negotiating challenges.
President Donald Trump is entering a critical phase of his second presidency, with an increasingly compelling political reason to conclude outstanding trade negotiations before January 3, when a newly elected, Democratic-controlled Congress takes office. Among the agreements Washington is keen to advance is a long-negotiated bilateral trade arrangement with India, which Trump and Prime Minister Narendra Modi are now expected to take towards a possible December conclusion.
The November 3 midterm elections have changed the political calculations in Washington. The Republicans have lost control of both the House of Representatives and the Senate, handing Democrats an opportunity to scrutinise the administration’s economic policies, trade negotiations, tariff decisions and foreign policy commitments. For Trump, the remaining weeks of the year represent an important window to demonstrate that his aggressive tariff diplomacy can deliver tangible international agreements.
India is particularly important in this calculation. It is not merely another trading partner with which Washington wants to reduce a trade deficit. It is a major emerging economy, a potential manufacturing alternative to China, a technology partner and an increasingly consequential strategic power in the Indo-Pacific.
A trade agreement with Narendra Modi would therefore offer Trump both an economic achievement and a geopolitical dividend. The immediate diplomatic challenge is to convert months of negotiations, disagreements and tariff confrontations into an agreement that both governments can present as a victory.
Trump’s urgency is understandable. The incoming Congress will have greater capacity to investigate the administration’s trade policies, question the concessions made to foreign governments and demand transparency over agreements negotiated through executive authority.
Democratic control of both chambers will also complicate the passage of legislation needed to implement certain trade commitments. Congressional committees can summon administration officials, examine the economic consequences of tariff concessions and challenge policies they believe disadvantage American workers or industries.
Trump may consequently prefer to secure political agreements and announce major commercial understandings while Republicans still control Congress.
There is, however, an important distinction. A president does not automatically lose the ability to negotiate trade arrangements when the opposition controls Congress. Nor does a change in congressional control prevent him from signing executive agreements. The difficulty arises when an arrangement requires legislation, appropriations or congressional approval to become fully operational.
For Trump, the objective is therefore not simply to sign documents before January 3. It is to establish agreements, announce commitments and create political momentum that would be harder for the incoming Congress to reverse.
The India negotiations have acquired precisely this significance. Reuters reported on November 10 that Indian and American officials were continuing discussions to finalise the first tranche of their bilateral trade agreement. American officials had visited India earlier in November, with customs procedures and trade facilitation among the subjects discussed. The report also explicitly placed the negotiations against the backdrop of Republican losses in the midterms.
The most difficult issue in the negotiations has been India’s continuing relationship with Russia, particularly its purchases of discounted Russian crude oil. Trump’s tariff strategy had previously placed India under considerable pressure. Washington argued that India’s purchases of Russian petroleum indirectly supported Moscow’s war effort in Ukraine. The administration used punitive tariffs and the threat of additional economic penalties to persuade New Delhi to diversify its energy supplies.
India resisted the pressure, maintaining that its energy decisions must be guided by national requirements, affordability and the interests of its 1.4-billion-strong population. India imports more than 85 percent of its crude oil requirements. Russian supplies became particularly attractive after Western sanctions disrupted traditional energy markets and Moscow offered discounted petroleum to willing buyers.
For New Delhi, abandoning Russian supplies overnight would be economically imprudent. It could increase import costs, put pressure on domestic fuel prices and expose the country to greater dependence on alternative suppliers. Washington, meanwhile, has its own commercial interests. American energy producers would welcome greater access to India’s enormous petroleum market.
The negotiations have nevertheless acquired some flexibility. In October, Trump waived proposed Russia-related tariffs and sanctions penalties that threatened to affect India. Secretary of State Marco Rubio subsequently indicated that the trade agreement was close to completion and acknowledged that India could not immediately replace all its Russian oil supplies.
This was a significant adjustment in Washington’s approach. Rather than insist on an immediate and complete break with Moscow, the administration appeared willing to recognise India’s gradual diversification of energy sources.
The change could provide the political breathing space needed for a trade breakthrough. But India’s position is unlikely to be reduced to a simple promise to purchase American oil. New Delhi will want assurances that its energy security will not become hostage to changing political preferences in Washington.
For Trump, the commercial stakes are substantial. The United States wants greater access to India’s vast consumer market, particularly in agricultural commodities, energy, industrial products, aircraft, technology and digital services. American companies see India as one of the most promising markets for expanding exports and investment.
India, on the other hand, wants lower American tariffs on its exports, better access for its pharmaceutical, textile, engineering and information technology industries, and a predictable trading environment. The negotiations have also involved India’s traditionally protective tariff structure and American complaints about non-tariff barriers.
The February 2026 framework, which had envisaged reducing American reciprocal tariffs on Indian goods to 18 per cent and removing an additional 25 per cent punitive levy associated with Russian oil purchases, provides an indication of the potential scale of the bargain. It also outlined India’s intention to purchase more American energy and technology products.
The White House subsequently described an ambition for more than $500 billion in Indian purchases of American energy, information and communications technology, coal and other products. These were commitments and intentions outlined in the framework, not evidence that all those purchases had already taken place.
The remaining negotiations will determine how much of this framework can be converted into enforceable commercial commitments. India will be particularly sensitive about agricultural market access. American farmers want easier entry into India’s market, while Indian farmers remain politically influential and vulnerable to competition from heavily subsidised American producers.
New Delhi will also seek to protect its interests in dairy, food security, pharmaceuticals and domestic manufacturing. The two governments must therefore reconcile Trump’s demand for reciprocity with Modi’s domestic political and economic priorities.
For India, the negotiations are about considerably more than tariffs and energy purchases. External Affairs Minister S. Jaishankar has consistently argued that India’s relationship with the United States must recognise New Delhi’s independent foreign policy, security requirements and regional priorities.
The proposed agreement also has implications beyond bilateral commerce. Washington wants India to become a more substantial participant in reorganising global supply chains away from excessive dependence on China. American technology companies increasingly regard India as an attractive destination for manufacturing, semiconductor-related investment, artificial intelligence development and digital infrastructure. India, for its part, wants to accelerate its ambition to become a global manufacturing centre.
The United States can contribute capital, technology, advanced manufacturing expertise and access to international markets. India offers a large domestic market, an expanding industrial base, skilled manpower and a strategic geographical position.
A trade agreement could strengthen this relationship considerably. But India will resist any arrangement that effectively makes it a subordinate economic partner or forces it to align automatically with American trade restrictions against third countries. This is where Trump’s transactional approach meets India’s traditional doctrine of strategic autonomy.
For Trump, an India agreement would be an important addition to his international trade record at a time when the midterm results have weakened his domestic political position. He could present the agreement as evidence that his tariff diplomacy produces results, persuades major trading partners to open their markets and generates business opportunities for American companies. It would also allow him to demonstrate that, despite losing congressional control, his administration remains capable of delivering major international initiatives.
For Modi, the advantages are equally significant. India would gain improved access to its largest export market, greater opportunities for American investment and technology transfers, and potentially a more stable framework for managing bilateral economic relations.
A successful agreement would also strengthen India’s international standing as a country capable of negotiating with the world’s largest economy without abandoning its independent foreign policy.
The proposed December signing, whether arranged around a G20-related diplomatic engagement or a separate meeting between the two leaders, would provide a highly visible opportunity for both governments to claim success. However, neither the precise signing venue nor a completed agreement has been established by the latest publicly available reporting.
There is another important distinction: what is being negotiated is a bilateral trade agreement, not necessarily a formal international treaty requiring the US Senate’s two-thirds ratification under the American constitutional treaty process. Its legal implementation will depend on the instruments and commitments ultimately agreed by the two governments.
The November 10 Reuters report is particularly important because it confirms that negotiations remain active even after the American midterm elections. It also indicates that the immediate focus is the first tranche of the agreement, rather than necessarily the completion of every outstanding issue in one comprehensive settlement.
Trump’s December ambition must therefore be viewed against the realities of negotiation. The Russian oil question, agricultural access, tariffs, digital trade, industrial protection and strategic security concerns cannot all be resolved through a ceremonial handshake. (IPA Service)
