Officials in New Delhi were, according to Bloomberg, “shocked and disappointed” by the announcement. But retaliation is off the table, at least for now. Instead, the government is examining trade options to maintain relations with its largest trading partner.
Commerce Minister Piyush Goyal addressed Parliament, saying, “The implications of the recent developments are being examined,” and added that the government is working with exporters and industry groups to understand the impact. He assured the House that India will take “all necessary steps to secure and advance our national interest.”
Imports may rise, but defence deals off the table
Sources cited by Bloomberg said India is looking at ways to reduce its trade surplus with the US. This may include increasing imports of American natural gas, communication equipment, and gold over the next few years. But the government is not considering any new defence purchases.
“Despite considering a boost in purchases of American goods, the Modi government is unlikely to buy additional defense equipments from the US, a key demand from Trump,” Bloomberg quoted officials familiar with the matter as saying.
That position directly impacts the US pitch to sell India the advanced F-35 fighter jets.
India rejects F-35 offer, prioritises Make in India
During Prime Minister Narendra Modi’s February visit to Washington, Trump personally pushed the sale of the F-35A stealth fighter jets. At first, Indian officials did consider the proposal, but eventually turned it down.India conveyed its position to the US, making it clear that it was not interested in off-the-shelf defence acquisitions. Instead, the focus is on co-developing and co-producing defence equipment in India, aligning with the country’s long-running Make in India initiative.
Bloomberg reported that “the Modi government is unlikely to approve any major new defence deals with the US in the near future.”
The US Defence Department has not publicly commented. India’s Ministry of Defence also declined to respond to Bloomberg’s request. Economic Times could not independently verify these claims.
Trump blasts Indian tariffs and Russia ties
In a series of posts on Truth Social, Trump launched a direct attack on India’s trade policies.
“India is our friend, we have, over the years, done relatively little business with them because their tariffs are far too high, among the highest in the world, and they have the most strenuous and obnoxious non-monetary Trade Barriers of any country,” Trump said.
He also criticised India’s defence and energy ties with Moscow, saying, “They have always bought a vast majority of their military equipment from Russia, and are Russia’s largest buyer of energy, along with China, at a time when everyone wants Russia to stop the killing in Ukraine — All things not good!”
Later, he added, “I don’t care what India does with Russia. They can take their dead economies down together, for all I care. We have done very little business with India, their Tariffs are too high, among the highest in the World.”
Talks slow, frustration rises in Washington
US officials have blamed India for dragging its feet on trade talks. Treasury Secretary Scott Bessent told CNBC, “The whole trade team has been frustrated” by India’s negotiating stance. He also took aim at India’s foreign policy direction, saying it “has not been a great global actor” because of its closeness to Russia.
Despite the public criticism, diplomatic channels remain open. India is still preparing to host the next Quad summit, which includes the US, Japan, and Australia.
Former commerce secretary Ajay Dua told Bloomberg TV, “We need to be a little more accommodating in the ongoing negotiations,” though he also noted that India cannot promise major energy imports or outbound investment in the current environment.
Defence shift: No F-35, no easy alternatives
India’s rejection of the F-35 offer reflects deeper issues in its defence strategy. It has no immediate alternative for acquiring a fifth-generation fighter. The F-35 remains the only combat-proven aircraft in this category currently available on the global market.
India’s own defence sector has struggled to develop anything close. The Tejas programme, aimed at delivering a fourth-generation fighter, has taken decades and only delivered around 38 aircraft, 17 of which are prototypes. Its limited combat performance has restricted export potential and slowed mass production.
Without foreign collaboration, developing a fifth-generation fighter remains out of reach. For now, India is looking to France. By 2028, it plans to begin manufacturing fuselages for Rafale jets at a rate of up to two units per month. That’s a long game.
Strategic gap and regional pressures
India’s regional security challenges are growing. China has accelerated the production and export of next-gen fighter aircraft. Pakistan, meanwhile, has started inducting new fighters from China, gradually upgrading its air force capabilities.
In this context, some experts believe India may still turn to Russia’s Su-57, the only other fifth-generation option available. India’s military already depends on Russian equipment across its air, land and naval forces. The existing logistics and familiarity could make this a more realistic short-term choice, even as Western ties are tested by broader geopolitical tensions.
For now, India is keeping its options open. Officials told Bloomberg that the government is not planning any immediate counter-measures to Trump’s tariffs. But it may challenge increased US duties on steel and automobiles at the World Trade Organisation when the timing suits its interests.
As it stands, the government wants to avoid escalation while keeping the door open for talks. It has no appetite for a trade war, but it won’t be pushed into lopsided defence deals either.
The pressure is mounting. But New Delhi seems willing to wait it out, eyes firmly on long-term sovereignty and stability in its economic and strategic choices.
(With inputs from TOI, Bloomberg)
