Trump Praises PM Modi at Davos, Signals Momentum in India–US Trade Talks

At the World Economic Forum (WEF) in Davos, U.S. President Donald Trump struck an optimistic and conciliatory tone while speaking about India and its leadership. Calling Prime Minister Narendra Modi a “fantastic leader” and a close friend, Trump expressed strong confidence that the United States and India would arrive at a favourable trade agreement. His remarks, made during interactions with the media on the sidelines of the summit, have reignited global attention on the long-pending India–US Bilateral Trade Agreement (BTA).

Trump’s praise of Modiji went beyond personal admiration and reflected the broader strategic importance Washington places on New Delhi. In an increasingly uncertain global economic environment, the United States sees India as a key partner in trade, technology, and geopolitics.

PM Modi, Donald Trump | India Today

The State of India–US Trade Negotiations

India and the United States have been engaged in negotiations for a bilateral trade deal since early 2025, aiming to significantly expand economic cooperation. Currently, bilateral trade stands at around USD 190 billion, and both governments have publicly set an ambitious target of scaling this up to nearly USD 500 billion by 2030. Officials on both sides have indicated that discussions have progressed on several fronts, though a final agreement remains elusive.

Indian commerce officials have suggested that the first phase of the trade deal is “very near,” but sensitive issues continue to slow the process. These include tariff barriers, agricultural market access, digital trade regulations, and concerns around subsidies. India has consistently maintained that any agreement must be balanced and should not compromise domestic sectors that are economically and socially sensitive.

Tariffs, Tensions, and Strategic Balance

Despite the positive rhetoric, trade relations have faced periodic friction. The United States has imposed high tariffs on certain Indian exports in recent years, while also raising concerns over India’s energy purchases and industrial policies. These measures have created pressure points in negotiations and have been a source of concern for Indian exporters.

From New Delhi’s perspective, the emphasis remains on fairness and reciprocity. Indian leaders have repeatedly stated that while India is open to deeper market access and cooperation, it will not accept terms that undermine its farmers, small industries, or strategic autonomy. Commerce Minister Piyush Goyal has been particularly vocal about ensuring that India’s long-term national interests remain protected.

Davos Signals and the Global Context

Trump’s comments at Davos are significant not just for India–US relations but also within the wider global trade landscape. At a time when the United States has witnessed strained trade negotiations with some traditional partners, including the European Union, the positive tone towards India suggests a strategic recalibration. India, meanwhile, is pursuing multiple trade agreements simultaneously, including advanced negotiations with the EU, highlighting its growing centrality in global supply chains.

For global investors and policymakers watching Davos, Trump’s remarks served as a signal that Washington is keen to maintain momentum with India, viewing it as both an economic opportunity and a strategic counterbalance in a shifting world order.

The MGMM Outlook

President Donald Trump’s remarks at the Davos summit, praising Prime Minister Narendra Modi and expressing confidence in a favourable India–US trade deal, underscore the growing strategic convergence between the two democracies. The public warmth reflects more than personal chemistry; it signals Washington’s recognition of India as a critical economic and geopolitical partner in an increasingly volatile global environment. With bilateral trade already nearing USD 190 billion and an ambitious target of USD 500 billion by 2030, the momentum around a long-pending Bilateral Trade Agreement has clearly gained renewed visibility on the global stage.

At the same time, the path ahead remains shaped by complex negotiations around tariffs, agriculture, digital trade, and subsidies. India’s consistent emphasis on balance, reciprocity, and protection of sensitive domestic sectors highlights its determination to safeguard long-term national interests even while deepening engagement. The positive tone from Davos suggests intent and political will, but the eventual outcome will depend on whether both sides can bridge structural differences and translate diplomatic goodwill into a durable, mutually beneficial trade framework.

(Sources: LiveMint, India Today, Hindustan Times)