Will Narendra Modi Cut a Better Deal Amid Donald Trump’s ‘Trade Tantrums’?

United States President Donald Trump has invited Prime Minister Narendra Modi to visit the White House next week on February 13, according to a White House official, reported by Reuters. It came hours after a US military aircraft deported an estimated 104 Indians from various states, who had entered the country illegally, according to a US government statement.

Modi and Trump held a conversation around immigration on January 27, where emphasis was also made on the importance of India buying more American-made security equipment and fair bilateral trading ties.

Vivek Mishra, deputy director of the Strategic Studies Programme at the Observer Research Foundation, sees Trump prioritising foreign relations in concentric circles—first the immediate neighborhood, then key geopolitical regions like Ukraine and the Middle East, and finally, India.

"These concentric circles are going to be picked by Trump in the order that he thinks they are important. I think that this visit is happening just within a month of his inauguration is a good sign in terms of what Trump wants," Mishra adds.

As Modi prepares for his first visit to the US under Trump’s new administration, anticipation is building around whether India can secure better trade terms and more for the next four years.

Anxiety around Trump's Trade War

Trump returned to the White House last month for a second time by brandishing his "America First" agenda. Since he started campaigning for the White House, Trump has constantly been criticical of high-tariff nations, including India. He has previously labeled India a “tariff king” and a “big abuser” of trade ties.

However, India managed to escape Trump's first tariff tantrum which included Canada, Mexico and China. Later, Trump agreed to hold off imposing 25% tariffs on Canada and Mexico for 30 days but went ahead with imposing 10% on Chinese imports. China also retaliated by imposing a 15% on imports of coal and liquefied natural gas (LNG) from the US, indicating a trade war.

"The trade war is in the early stages so the likelihood of further tariffs is high," said Oxford Economics as it downgraded its China economic growth forecast.

In what seemed like an effort to ease tensions, on February 1 in its budget 2025-26, the Indian government cut import tariffs on several products like high-end motorcycles, including those from Harley-Davidson. Finance secretary Tuhin Kanta Pandey insisted that India’s policies are pro-competition rather than protectionist.

However, during a post-budget media interaction, finance minister Nirmala Sitharaman clarified that the government did not go that far to consider the development in the US while drafting the budget.

Immigration Tensions: Deportations Before Talks

The problem does not end at trade issues. Indians were also the third-largest group to enter the US illegally, right after Mexico and El Salvador, from 2019 to 2022 according to Pew Research. This is often via the risky “donkey” route of border crossing. According to Bloomberg, India and the US have identified up to 18,000 illegal Indian migrants to be sent back home.

Just days before Modi’s visit, the US deported 104 illegal Indian immigrants via a military aircraft—reportedly many in handcuffs and chains—underscoring the US’s tough stance.

 This timing raises questions about the deportations being a strategic move by the US to negotiate from a position of strength.

What to Expect from Modi-Trump Meeting?

Despite the odds, Trump’s decision to exempt India from the first wave of trade measures suggests a willingness to keep negotiations open. If India manages to negotiate a deal averting the trade war, it could secure better terms amid US-China tensions.

Mishra highlights potential pressures on India in its engagement with Trump, particularly regarding trade-offs in defense and immigration policies. He suggests that India can assert its compliance with the US laws, including taking back illegal immigrants, to push back on issues like H-1B visa restrictions.

Arnab Deb, associate professor of Economics at IMI in New Delhi, believes that the discussion is expected to have a strong focus on negotiation on tariff rate so that India’s access to the American market such as technology and manufacturing is not adversely affected.

“On the national security front a discussion on the collaboration within the Quadrilateral Security Dialogue [QUAD] framework is likely to happen as both the nations share concerns over China’s growing influence in the Indo-pacific region,” Deb adds.

Meanwhile, Trump has recently asked the US Secretary of State to modify or rescind sanctions waivers particularly those that provide Iran any degree of economic or financial relief, including those related to Iran’s Chabahar port project.

India has developed the Shahid Beheshti Terminal at the Chabahar port under a 2016 trilateral agreement with Iran and Afghanistan, spending millions. The Indian government maintained its distance from commenting on the issue immediately. Hence it is expected that Modi will also discuss the matter with Trump during the visit.

As February 13 approaches, experts will be watching to see if Modi and Trump can bridge their differences and resolve long-standing trade and immigration concerns.