Indo-U.S. Relations: Between Prosperity and Constraints

Few bilateral relationships have transformed as dramatically in the last two decades as that between India and the United States. From estrangement during the Cold War to near hostility after India’s 1998 nuclear tests, the two democracies now find themselves bound by an intricate web of strategic, economic, and technological partnerships. The 2005 U.S.-India Civil Nuclear Agreement, which effectively recognised India as a de facto nuclear power, was a watershed moment. Since then, the partnership has deepened to include defence cooperation, high technology transfer, climate collaboration, and expansive people-to-people ties.

Yet, as strategic analyst Ashley J. Tellis has often observed, this relationship is simultaneously deep and asymmetrical. It is comprehensive, covering almost every aspect of modern statecraft, but it is also fragile when viewed through the lens of expectations. Washington sees India as a potential great power and a democratic counterweight to China; New Delhi prizes its autonomy and hesitates to be bound by alliance commitments.

The Sources of Prosperity

Strategic Convergence in the Indo-Pacific: A Reassuring Alignment

The most visible prosperity stems from geopolitical convergence. Both countries view China’s rise with concern. For the U.S., China is a peer competitor threatening American primacy. For India, China is a regional rival with whom it shares a disputed border and a history of conflict. This alignment has led to cooperation in the Quadrilateral Security Dialogue (Quad) with Japan and Australia, joint military exercises like Malabar, and naval coordination across the Indo-Pacific.

The U.S. has increasingly endorsed India’s role as a “net security provider” in the Indian Ocean, supporting its capacity-building in South Asia and the broader Indo-Pacific. This recognition boosts India’s stature while serving U.S. interests in balancing China.

Defence and Technology Transfers

Since 2008, India has signed over $20 billion worth of defence deals with the United States. These include C-17 Globemaster and C-130J transport aircraft, P-8I maritime reconnaissance planes, Apache and Chinook helicopters, and, most recently, drones and advanced artillery systems.

Crucially, the Defense Technology and Trade Initiative (DTTI) provides a platform for cooperative development and production. The recent agreement to co-produce jet engines in India with GE Aerospace and HAL reflects a new phase where technology transfer complements hardware sales. For India, this enhances indigenous capability; for the U.S., it binds India into its defence-industrial ecosystem.

Economic Growth and Market Synergy

Economic Growth and Market Synergy: A Confidence-Boosting Partnership

India’s massive middle-class consumer base offers U.S. corporations long-term opportunities, while India benefits from access to American capital, technology, and innovation. This synergy is central to Prime Minister Modi’s vision of India as a $5 trillion economy.

The Power of the Diaspora and Education

Over 200,000 Indian students are enrolled in American universities, forming an elite knowledge pool that contributes to India’s IT and research ecosystem. The four million-strong Indian diaspora in the U.S. is among the wealthiest and most politically influential immigrant groups, many heading technology and other companies in the U.S. This community acts as a cultural and political bridge, sustaining bipartisan support in Washington for strong ties with New Delhi.

However, there is silence because the Indian community’s first-generation US citizens lack the influence that the Jewish community has, which tends to side with either the Democrats or Republicans on Israel policy issues.

Climate and Energy Cooperation

Energy remains a key pillar of prosperity. The U.S. supports India’s shift to renewable energy, including solar, nuclear, and hydrogen technologies, through joint initiatives like the U.S.-India Clean Energy Finance Task Force and by channelling investments into sustainable infrastructure. Meanwhile, India enhances its energy security by importing U.S. LNG, reducing reliance on unstable suppliers.

The Navarro Factor: Malicious Commentary Post-Prison

An unusual but telling irritant in the Indo-U.S. discourse has been the recent conduct of Peter Navarro, a former White House trade advisor who served jail time for contempt of Congress. Upon his release, Navarro has taken to making malicious and ill-founded statements against India and its citizens, including claims that India’s energy dealings with Russia amount to “funding Putin’s war” and characterising New Delhi as an unreliable partner. Many in India interpret such remarks as an attempt by Navarro to “sing for his supper” using exaggerated rhetoric to regain political relevance in Washington after his conviction. While Navarro himself no longer speaks for U.S. policy, his rhetoric underscores how individuals seeking rehabilitation in American politics can create narrative irritants that distract from the broader, more positive trajectory of Indo-U.S. relations.

The Persistent Constraints

Strategic Autonomy vs. Alliance Expectations

India has consistently emphasised non-alignment and strategic autonomy. This concept refers to a nation’s ability to make independent decisions in its foreign policy without being bound by military alliances. Even today, New Delhi resists binding military partnerships. This frustrates Washington, which seeks a closer partner in its strategic competition with China. India’s neutral stance on the Ukraine war, continuing oil purchases from Russia, and hesitancy to condemn Moscow illustrate this divergence.

Tellis has noted that Washington must accept this reality; India will never be an ally in the NATO sense. It will remain an independent pole that collaborates when interests align, but resists being drawn into America’s broader global agenda.

Economic Frictions

Despite robust trade, disputes are frequent. The U.S. has criticised India’s tariffs, agricultural protectionism, and data localisation policies. India, in turn, views U.S. pressure as threatening its domestic industries. The Trump administration’s withdrawal of India’s GSP (Generalised System of Preferences) benefits in 2019 exemplified this tension.

Such disputes highlight a contradiction: even as trade grows, protectionism on both sides periodically clouds the horizon.

Defence Dependency on Russia

India continues to source nearly 60% of its military equipment from Russia. This legacy dependence complicates interoperability with U.S. forces and raises political dilemmas in Washington. The S-400 air defence purchase, a significant military deal between India and Russia, subjected India to potential U.S. sanctions under CAATSA, a U.S. law aimed at punishing Russia for its interference in Ukraine. While waivers have been discussed, the issue underscores the structural limits of defence cooperation.

Human Rights and Domestic Politics

American lawmakers frequently raise issues of religious freedom, minority rights, and press liberty in India. For New Delhi, these are seen as intrusive judgments on domestic affairs. For Washington, however, they reflect the expectations of an alliance with another democracy. This mismatch often fuels irritation in diplomatic exchanges.

Asymmetry of Power and Delivery

Tellis has written that India aspires to great power status but is constrained by institutional bottlenecks, infrastructure gaps, and governance weaknesses. The U.S., viewing India as a significant strategic partner, can find India’s inability to fully deliver on ambitious promises frustrating. Patience will be key, but expectations must be tempered.

SWOT Analysis: Indo-U.S. Relationship

Tellis’s Perspective: A Balanced Interpretation

Ashley Tellis offers a nuanced lens to interpret this relationship:-

• Take the long view; short-term irritants like tariffs or sanctions threats should not derail the larger strategic picture.
• Respect autonomy; Washington must accept that India will not abandon its independent posture. Expecting otherwise will only breed disappointment.
• Focus on mutual gain; India should concentrate on leveraging U.S. technology and capital for its development, while the U.S. benefits from India’s market and geopolitical heft.
• Patience over volatility; domestic politics in both countries will produce turbulence, but the depth of the relationship ensures resilience if managed pragmatically.

Conclusion

The Indo-U.S. relationship today is among the most consequential in global politics. The prosperity lies in their shared vision for the Indo-Pacific, booming trade, defence technology cooperation, and the connective tissue of diaspora ties. The constraints arise from India’s insistence on autonomy, trade frictions, legacy defence dependencies, and occasional political irritants.

For India, the challenge is to harness American support without compromising sovereignty, while building the economic and military muscle that underpins great power status. For the U.S., the challenge is to temper expectations, invest in India’s rise, and accept partnership in place of alliance.

In the words of Ashley Tellis, the future of this relationship lies not in idealistic alignment but in pragmatic convergence. If both nations recognise this, they can move beyond prosperity and constraints to build a partnership that is resilient, adaptive, and truly transformational for the 21st century.