Despite former US President Donald Trump’s dismissal of India as a “dead economy,” economic data and ongoing collaborations paint a picture of robust growth and strengthening ties between the two nations.
India’s Economic Resilience and Global Standing
Contrary to Trump’s remarks, India is widely projected to remain the fastest-growing major economy globally. The International Monetary Fund (IMF) recently raised India’s GDP growth forecast to 6.4 percent for 2025-26 and 2026-27, while the Reserve Bank of India (RBI) predicts a stable 6.5 percent for the next fiscal year.
The Finance Ministry also estimates growth between 6.3-6.8 percent, highlighting a sense of “cautious optimism” amidst global challenges. While minor concerns like slow credit growth exist, these do not overshadow India’s significant economic progress.
Currently, India stands as the world’s fifth-largest economy with a GDP of $3.9 trillion in 2024. Projections indicate it will surpass Germany and Japan by 2028, securing the third position behind only the US and China, firmly debunking any notion of a “dead” economy.
Deepening US-India Collaboration Across Sectors
Beyond economic figures, the partnership between India and the US has seen significant advancements across crucial sectors, demonstrating a strategic alignment that contradicts critical rhetoric.
In space exploration, the NASA-ISRO Synthetic Aperture Radar (NISAR) satellite, a collaborative project, was recently placed into orbit. This powerful Earth observation satellite is the result of over a decade of joint research. Further cooperation is planned with the launch of the Block 2 BlueBird communications satellite, developed by US-based AST SpaceMobile.
During Prime Minister Narendra Modi’s US visit, both nations announced the Transforming Relationship Utilizing Strategic Technology (TRUST) initiative. This bilateral effort focuses on cooperation in critical minerals like lithium and rare earth elements, aiming to reduce barriers to technology transfer and enhance high-tech commerce.
Boosting Bilateral Trade and Defence Ties
Trade relations are also on an upward trajectory, with both countries agreeing to double bilateral trade to $500 billion by 2030. In 2024, total goods trade reached $129.2 billion, with a notable increase in US exports to India and Indian imports to the US.
India’s electronic goods exports, particularly smartphones, have seen significant growth. India’s share in US smartphone imports surged to nearly 36 percent in the first five months of 2025, largely driven by Apple’s iPhone production in India, which now accounts for roughly 20 percent of Apple’s global capacity.
Addressing Trump’s “Tariff King” criticism, India has proactively reduced duties on top US imports, including crude oil, LNG, and motor vehicles. Finance Minister Nirmala Sitharaman highlighted that India has brought down tariff rates to eight, including a zero percent rate.
Defence cooperation is also set to strengthen. The 10-year defence framework is being renewed, with discussions around increased military supplies, including potential F-35 stealth fighters, Javelin anti-tank missiles, and P-8I maritime patrol aircraft. A new defence partnership framework is expected to be signed later this year.
Navigating Frustrations in Negotiations
While Washington officials, including former US Treasury Secretary Scott Bessent, have expressed frustration over the pace of trade deal negotiations, viewing Trump’s comments as a pressure tactic, India maintains its stance on protecting national interests. Commerce Minister Piyush Goyal affirmed that the government will take all necessary steps to secure the best possible deal for its people.
- India is projected to remain the fastest-growing major economy globally.
- Significant US-India collaborations are underway in space, critical minerals, and defence.
- Bilateral trade is targeted to reach $500 billion by 2030, with India’s exports, especially in electronics, rising.
- India has reduced tariffs to address US concerns, demonstrating a commitment to open trade.
Despite occasional sharp rhetoric, the foundational economic and strategic partnership between the United States and India continues to deepen, driven by mutual interests and a shared vision for growth and collaboration.
