Trade Deal Seen as Key to Easing US-India Tensions, Says Analyst Michael Kugelman

South Asia analyst Michael Kugelman has emphasised that a trade deal could be pivotal in stabilising the strained US-India relationship. Speaking to ANI, Kugelman noted that despite ongoing tensions, continuing trade negotiations present a rare opportunity to rebuild trust and confidence between the two nations.

“Even with tensions as high as they’ve been, we have continued to have trade talks in recent days — and there’s no reason to think that those talks are going to stop anytime soon,” Kugelman said.

For Washington and New Delhi, he argued, a trade agreement could provide more than economic benefits. “If we do get a trade deal, that would be a big confidence-building measure, would restore some trust in the relationship and it would also reduce what has really been one of the biggest tension points and that’s the very high US tariffs imposed on India,” he added.

Tariffs and Visa Fees Add Strain

Kugelman highlighted that tariffs are not the only challenge. The recent steep hike in H-1B visa fees, he noted, has further strained the bilateral relationship. “This decision is another indication that the relationship is still in a bad state, even after we had that phone call between Trump and Modi,” he said. Given that the H-1B program has long underpinned US-India tech collaboration, higher costs could deliver a “pretty significant blow to US-India tech relations.”

Regional Dynamics: Pakistan-Saudi Pact

On regional security, Kugelman described the newly signed Pakistan-Saudi Arabia defence pact as “a game changer.” While Saudi Arabia is unlikely to jeopardise its ties with India, the alliance poses new strategic challenges. “Pakistan now has a formal institutionalised alliance with Saudi Arabia, and with revived ties to the US, China, Turkey, and Gulf allies, it has been able to fortify many of its partnerships,” he explained.

US-Pakistan Warming Adds Pressure

The strengthening US-Pakistan relationship has also contributed to tensions with India. Kugelman noted that if Pakistani Prime Minister Shehbaz Sharif follows through on a visit to Washington, it would underscore the growing depth of bilateral ties, further testing the US-India dynamic.

Trump’s UNGA Remarks: No Reset Yet

Kugelman also weighed in on President Donald Trump’s speech at the UN General Assembly, describing it as “extremely undiplomatic, seemingly rambling.” He highlighted Trump’s continued accusations against India for allegedly sponsoring Russia’s war in Ukraine, reinforcing Kugelman’s assessment that a full reset in the US-India relationship remains elusive.

In conclusion, Kugelman emphasised that while multiple challenges persist—from tariffs and visa policies to regional alliances and political rhetoric—a successful trade deal remains a critical step toward restoring stability and trust in the bilateral partnership.