India–U.S. relations leading up to and in Narendra Modi’s leadership (2018–2023) witnessed a lurch in India’s strategic, economic, and geopolitical orientation. During these five years, the defense partnership was strengthened, trade expanded, and technology and energy sectors collaborated even more while navigating complex challenges of diverse economic policies and concerns about democratic governance. India acted as a major factor in America’s Indo-Pacific strategy, given the American need to oppose China’s ascendancy in the region, both points of interest that India shares with the U.S.
The period of recalibration in U.S.-India relations was characterized by strategic convergence alongside long-standing differences. Traditionally, India’s foreign policy has been nonaligned, but under Modi’s leadership, India’s foreign policy has taken an issue-based alignment with the U.S. in defense and technology. There were challenges, for example, in several areas, including trade tariffs, human rights, and India’s position on Russia. Still, the overall trajectory focused on working together — especially in the Indo-Pacific region. The economic challenges to the bilateral relationship came from both countries’ nationalist trade policies and were experienced simultaneously. While these obstacles exist, both nations were able to come together based on technological advancements and energy cooperation and working with larger issues like climate change.
Strategic and Defense Ties
This era saw a big improvement in India & U.S. defense ties, especially through associations like the Communications Compatibility and Security Agreement (COMCASA) as well as the Logistics Exchange Memorandum of Agreement (LEMOA). The agreements served to develop reciprocal bases for use by the military and to share intelligence, thereby provoking closer military cooperation. In 2016, the U.S. announced it was elevating India to ‘Major Defense Partner’ status, encouraging India to buy such technologies from the US, including aircraft and missile systems (Congressional Research Service, 2023).
India’s participation in the Quadrilateral Security Dialog (Quad) with the U.S., Australia, and Japan has been important to maintain a balance of power in the Indo-Pacific. Mutual concerns about China’s influence drove the Quad, a strategic convergence whereby India played a larger role in regional security initiatives (Council on Foreign Relations). Yet India’s deep affinity to Russia, especially in defense equipment, worked against this orientation of India with the U.S. as the latter campaigned for India to lessen its dependence upon Russian military hardware (Carnegie Endowment, 2024).
Among the most important steps in that period was the 2+2 Dialogue, a high-level diplomatic mechanism launched in 2018, in which each country’s foreign and defense ministers met once a year. The dialogue consisted of flourished military cooperation, including participation in joint military drills, arms trade etc., upgrading the status of India as a formidable actor in the Indo-Pacific region. In addition, particularly in 2018, with the signing of the Communications Compatibility and Security Agreement (COMCASA), and in 2020, with the Basic Exchange and Cooperation Agreement (BECA), the two nations gained greater military interoperability and information sharing.
Economic Engagement and Trade Tensions
India-US bilateral trade grew significantly from 80.51 billion USD in 2020-21 to 119.42 billion USD in 2021-22 (Drishti IAS) . A deepening economic partnership was reflected in India’s exports to the U.S., up 2.81%, and imports, up 16%. Trade numbers showed some positive momentum, but friction in the economy arose from protectionist policies of India like ‘Make in India’, which preferentially favored production over imports. The Trump administration’s tariff policies also complicated trade relations in agricultural products and technology (BBC News).
U.S. investments in India also increased in technology, infrastructure, renewable energy sectors, and trade. India approached America for investment to aid its infrastructure development and technological capability, especially in smart cities, clean energy and digital transformation. The U.S., meanwhile, had become one of the top five sources of foreign direct investment (FDI) in India during this time, making this a part of this economic partnership.
Despite this growth, however, trade relations remained in crisis. India and America had rows over features, including market access and trade imbalances, where India was hit with higher tariffs under President Donald Trump. Although these disputes were somewhat resolved during Joe Biden’s tenure, they were never fully closed out, leaving a black spot in the bilateral relationship. However, both countries were able to keep their economic partnership from being too cumbersome.
While the Biden administration introduced the Indo-Pacific Economic Framework for Prosperity (IPEF) in 2022, it gave a new lease to economic cooperation. But India’s refusal to join the trade pillar of IPEF because of concerns about labour and environmental standards highlighted persisting economic divergence. His government stayed true to its commitment to financial self-reliance, sometimes at odds with U.S. expectations of greater market access and trade liberalization.
Foreign Policy Shifts and Multilateralism
India’s foreign policy departed from the traditional nonalignment to a more issue-based alignment, especially with the U.S. Shared interests leading it to checkmate China’s ascent in the Indo-Pacific. This alignment rested on Modi’s ‘Act East Policy’ — a policy crafted to bring India closer to Southeast Asian nations. Promoting India‘s regional strategic interest aligned with the United States lenses. Further, this convergence was shown in India’s more intensive security and diplomatic interaction with important U.S. allies, including Japan and Australia.
It is a growing alignment, yet India’s relations with Russia continue to strain. India’s strategic ties with Russia, especially in energy and defense, made it difficult to be in U.S.-led initiatives. This was more visible during the Ukraine war, for when India stood by and chose not to take a side, it maintained a neutral stance with emphasis on its policy of strategic autonomy.
Collaboration on Technology and Energy
The U.S.-India partnership reached key areas like technology and clean energy. The Initiative on Critical and Emerging Technologies (iCET) launched in 2023, namely artificial intelligence, quantum computing, and semiconductor supply chains. It was also part of an effort to reduce their reliance on Chinese technological ecosystems. The two nations also expanded their cooperation in space, including planning joint space missions and sharing technological expertise in satellite development and space exploration.
Energy collaboration also characterized the bilateral relationship, particularly in clean energy transitions. In 2021, the U.S.-India Strategic Clean Energy Partnership was launched, which supported India’s journey towards energy transition and helped the planet meet climate targets. Yet, India’s reliance on coal made it less likely that it could fulfill global climate targets.
Diplomatic Challenges: Democracy and Human Rights
Although the two countries have been growing strategically, the U.S. has criticized India’s democratic backsliding and human rights problems during Modi’s tenure. The biggest concerns were restrictions on press freedoms, the way religious minorities were handled, and internet shutdowns. During diplomatic encounters, the United States Secretary of State Antony Blinken spoke publicly about these concerns, illustrating the meeting of shared strategic interests with democratic values.
However, these democratic issues still left vacancies in the diplomatic narrative as the U.S. government supported India’s rise into a global power while remaining the source of tension. The Biden administration, however, was under constraints to keep these concerns in check so as not to derail broader strategic partnerships (Congressional Research Service, 2023).
During his visit to India, the U.S. strongly favored India’s permanent membership in a reformed United Nations Security Council (UNSC), a point of strong diplomatic cooperation between the two countries. The White House reports that both countries worked together to maintain stability and security in the region through the Indo-Pacific strategy, which became a central part of their diplomatic engagement.
A second issue was India’s stand on Russia during the Ukraine conflict. The U.S. imposed sanctions on Russia and urged a united international response. Still, India took a more neutral position because of Moscow’s ties and dependence on the country’s supplies of military equipment. The difference in foreign policy approaches put the U.S.-India partnership to the test but did not destroy the overall trajectory of cooperation (Carnegie Endowment for International Peace).
Conclusion From 2018 to 2023, U.S.-India relations under Indian Prime Minister Narendra Modi became a multifaceted partnership, with major moves in defense, trade, and technology cooperation. But while there have been disagreements over trade tariffs and foreign policy, the overall trajectory of the relationship is positive. Even with such glaring inconsistencies in U.S. policies, their growing technological and economic cooperation suggests the very strategic alignment of the two nations, particularly in the Indo-Pacific. Their continued importance for future global geopolitical trends indicates that U.S.-India relations will remain central.
The Author, Muhammad Ibrahim is an independent researcher and analyst. His expertise lies in analyzing foreign policy and its implications on global politics.
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