Key Friction Points Between Trump & Modi on India - US Relations in 2019

  • 1. Trade: Even as Indo-US bilateral trade grew to $142 Bn in 2018, the US has been hammering at its trade deficit - $24.2 Bn in India's favour. Both countries are going back & forth imposing tariffs on various goods
  • 2. Visas: Trump administration plans to make H1B work visas both harder and costlier for Indians, and automatic work permit for those awaiting Green Cards, creating a lot of concern amongst Indian workers currently in US
  • 3. Arms Imports: India contracted to buy five S-400 Triumf missile systems from Russia in 2018, to which US has objected and threatened to put sanctions under CAASA (Countering American Adversaries through Sanctions Act)
  • 4. Iran: In Aug 2018, Trump administration imposed a fresh round of Sanctions on Iran and extended them to countries that do business with it, resulting in pressure on India to find alternate cost effective oil sources
  • 5. Afghanistan: Trump administrations negotiation of a peace deal with Taliban - including a permanent ceasefire has raised safety concerns for India, as it strengthen's Pakistan's position and leaves India vulnerable
  • 6. Data Localization: In April 2018, the Reserve Bank of India issued regulations requiring operators to maintain financial transactions record within India, to which there was a lot of protest from American trade bodies
  • 7. Huawei and 5G: On May 12 2019, Trump issued an order imposing export controls on Chinese giant Hauwei citing national security concerns and threatening punitive actions on those who work with them
  • 8. Lincoln House: In 2015, the US embassy sold the iconic Lincoln House which housed the consulate in Mumbai for Rs. 750 crore. However, the Indian defense ministry has challenged the sale suggested it was under a lease
  • 9. E-commerce: In December 2018, India amended its e-commerce policy tightening FDI conditions in online space to provide a level playing field to local vendors and avoid deep discounts from giants like Amazon & Walmart
  • 10. Harley Davidson: Trump has long criticized India for it's import duties, and Harley Davidson motorcycles which earlier faced 100% tariffs and now 50% have been his favorite example to use as a punching bag

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