US-India Ties: Strategic or Transactional?

[Riaz Haq]

During the last Trump Administration in 2019, India's friends in Washington argued for a US policy of "strategic altruism" with India. The new Trump administration seems to be rejecting such talk. Prior to his recent meeting with Prime Minister Narendra Modi at the White House, President Donald Trump described India as the "worst abuser of tariffs" and announced "reciprocal tariffs" on Indian imports to the United States.  At the same time, Mr. Trump cracked down on both legal and illegal immigration from India. His administration is deporting thousands of illegal Indian immigrants in handcuffs and shackles on US military aircraft. Meanwhile, stringent new regulations on temporary work visas could significantly delay visa processing times and reduce the number of Indian workers employed in the United States on H1B visas. 

Tariffs Comparison. Source: BBC

In a 2019 piece titled "The India Dividend: New Delhi Remains Washington’s Best Hope in Asia" published in Foreign Affairs journal, authors Robert Blackwill and Ashley Tellis argued that the Trump Administration should continue the US policy of "strategic altruism" with India that began with US-India nuclear agreement. They asked President Trump to ignore the fact that the US companies and economy have only marginally benefited, if at all, from this policy. They see India as a "superpower in waiting" and urge Washington to focus on the goal of having India as an ally to check China's rise. They see Chinese support for India's arch-rival Pakistan and China’s growing weight in South Asia and beyond as a threat to India. 

India Tops Source Countries For H1B Visa Holders. Source: USCIS

Trump's trade and immigration policies are going to hurt India at a time when its economic growth is declining and job growth is stagnant.  The latest Indian annual budget has offered middle class tax relief to spur growth.  But economists warn it may not be enough for the vast majority of Indians, whose income still falls below taxable limits and who may still be reeling from the impact of the COVID pandemic, which devastated their earnings, according to a report in Aljazeera. “There is a vast base [of people] where recovery has not come back after the pandemic,” says Kaushik Basu, professor of economics at Cornell University. “We see this in data that the agricultural labour base has increased. And agriculture may well be just a parking spot.”

Illegal immigration from India to the US has dramatically increased on Prime Minister Modi's watch. A Pew Research Center report said that as of 2022, India ranked third, after Mexico and El Salvador, on the list of countries with the largest number of undocumented immigrants — 725,000 — living in the U.S.

India has a serious unemployment problem, particularly for the young people entering the job market by the millions each year. This problem is concealed by headline  economic growth figures highlighted by the Modi government. At the same time, India is losing its best and brightest in a massive brain drain. 

President Trump has clearly not taken the advice of India's friends in Washington. He is in no mood for "strategic altruism". Instead, the Trump Administration has signaled that it will treat ties with India as just another transactional relationship. 

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[Riaz Haq]

Tougher H-1B Visa Scrutiny Anticipated as Annual Lottery Opens


https://news.bloomberglaw.com/daily-labor-report/tougher-h-1b-visa-...

Higher fees not likely to deter entries in annual lottery starting March 7
More scrutiny expected of petitions for specialty worker visas
US businesses looking to add high-skilled foreign talent on H-1Bs face the potential for stringent scrutiny from the Trump administration if they come out on top of the annual lottery for the specialty occupation visas.

Employers can register workers starting Friday for the chance to apply for one of 85,000 new visas, which are most heavily used in the technology industry. It’s the first selection process since US Citizenship and Immigration Services hiked registration costs to $215.

But immigration attorneys don’t expect a significant slowdown in interest because of the higher cost of entry. The bigger question for many is how hard getting visa approvals will be after the lottery.

“The reality is that even small employers rely on the H-1B for their talent pipeline. I don’t think the fee increase is going to change that model,” said Isha Atassi, a partner at Fragomen, Del Rey, Bernsen & Loewy LLP. “We certainly expect higher levels of scrutiny on petitions for those that are lucky enough to be selected.”

Tougher Vetting
The H-1B program has been a subject of infighting within Trump administration circles. While White House adviser Elon Musk has defended the need for the program, figures like Steve Bannon have attacked it for undermining US workers. In the first administration, rejection rates jumped and approval of new visas slowed thanks to a deluge of requests for evidence to support information in visa petitions.

Many expect similar hurdles this time around. That’s thanks in part to new H-1B regulationsfinalized by the Biden administration last year that require a worker’s degree be directly tied to their role.

“The actual adjudication of H-1B petitions once the registrations are selected in the lottery, I think is going to go very slowly,” said Angelo Paparelli, a partner at Vialto Law (US) PLLC.

The main immigration focus in the early weeks of Trump’s second term has been detaining unauthorized immigrants and ramping up deportation rates. How USCIS handles H-1B petitions after the upcoming lottery will offer a strong indicator of its workplace enforcement agenda, attorneys said. Many are preparing now by anticipating potential information requests when they craft visa petitions.

“Immigration attorneys and clients right now are kind of on edge waiting to see how the dust is going to settle,” said Anna Gorisch, managing partner at Kendall Immigration Law PLLC.

Fee Hikes
USCIS last year finalized new fees on a slate of immigration benefits for the first time since 2016. The fee-funded agency said adjusting user fees was long overdue to help pay for the costs of adjudicating immigration benefits.

Since the online registration system for the H-1B lottery was launched in 2020, employers only had to pay $10 to register each worker. That was a negligible cost that did little to discourage the growth in registrations, Gorisch said.

“It’s a ‘why not’ at $10,” she said.

The top H-1B employer in fiscal year 2024, Amazon.com Inc., got approval for more than 3,800 new visa petitions that year. A $205 increase may appear steep, but it’s still a fraction of the costs of an H-1B worker’s salary, and even pales in comparison to recruiting costs, said Xiao Wang, CEO at Boundless Immigration.

“If a company needs the foreign talent, they’re still willing to pay,” he said.

Employers’ demand on the program would likely only change, Wang said, if the government mandated significantly higher prevailing wage levels for entry-level workers, which are determined by their role and the region where they are based. The first Trump administration attempted to raise wage rates for the visa program before it was blocked by litigation.

[Riaz Haq]

Shashank Mattoo
@MattooShashank
Shocking arrogance on display here from US Commerce Secretary Howard Lutnick

- "India needs to stop listening to silly people"
- Laughs at concerns about US reliability as defence supplier
- Dismisses UK, France and Russia as Indian defence partners

https://x.com/MattooShashank/status/1898223018763338127

[Riaz Haq]

Singapore says Asia now views U.S. as a ‘landlord seeking rent’ - The Japan Times


https://www.japantimes.co.jp/news/2025/02/17/asia-pacific/politics/...

Asian perspectives of the U.S. have shifted from a country once perceived as a force of "moral legitimacy” to something akin to "a landlord seeking rent," Singapore’s defense chief said on the sidelines of an international security meeting.
Ng Eng Hen said in a round-table discussion at the Munich Security Conference that assumptions undertaken in the years after the end of World War II have fundamentally changed.

One example is that from the time of then-U.S. President John F. Kennedy’s inaugural address more than 60 years ago, the image of the U.S. was of a country that would not allow tyranny such as colonial control to be replaced by another form of tyranny. Now "the image has changed from liberator to great disruptor to a landlord seeking rent," according to a prepared text of his remarks posted on a government website over the weekend.

The remarks came after U.S. President Donald Trump’s administration blindsided historic NATO allies with plans to directly negotiate with Russian President Vladimir Putin over the future of the Kremlin’s war on Ukraine. The fear for many officials gathered for the conference in Germany is that by dialing back support for Ukraine, Trump is inviting Putin to probe NATO’s willingness to defend the alliance’s eastern borders.

National security adviser Mike Waltz, meanwhile, said the U.S. deserves "payback" from Ukraine for its support against the Russian invasion and Ukrainian President Volodomyr Zelenskyy would be "very wise" to accept a minerals deal offered by the Trump team.

Zelenskyy has rejected a U.S. draft agreement that would give Washington access to critical minerals in the war-battered nation because it didn’t offer investments and sufficient protections.

In its first month, the new Trump administration has made clear it’s willing to quickly alter defense and economic policies that have been in place for decades. It’s a shift that has drawn in attention in Asia, where the U.S. has stationed tens of thousands of troops, as nations there seek to navigate persisting tensions between the U.S. and China.

Singapore, like much of Southeast Asia, has sought a middle path in an increasingly complicated geopolitical picture, seeking to balance ties with the U.S. as a major security partner and source of investment, and China, as one of its biggest trade partners.

Under previous President Joe Biden, the U.S. worked to form a lattice of security arrangements in the region as a counter to Chinese assertiveness in places such as the South China Sea. Another persistent security concern is China’s pledge to bring Taiwan under its control someday, by force if necessary.

[Riaz Haq]

Germany’s chancellor-in-waiting prioritizes ‘real’ independence from the US − but what does that mean and is it achievable?

https://theconversation.com/germanys-chancellor-in-waiting-prioriti...

Germany’s presumptive new chancellor, Friedrich Merz, faces challenges both at home and overseas following his conservative alliance’s election victory on Feb. 23, 2025.

A strong showing from the hard-right Alternative for Germany (AfD) – which Merz, in line with other mainstream German parties, refuses to countenance as a coalition party as part of an unofficial “firewall” against extremism – will make forming a functioning government tricky.

But in the moments after the election results, it was the future of the European Union and its relationship with America that was his immediate focus: “My absolute priority will be to strengthen Europe as quickly as possible so that, step by step, we can really achieve independence from the USA.”

To understand why that is such a concern for Germany now and what “real independence” from Washington means, The Conversation U.S. turned to Garret Martin, an expert on U.S.-Europe relations at American University, for answers.

What prompted Merz’s ‘real independence’ line?
Presumably it was a response to a series of recent announcements and actions by the Trump administration that have shocked the German political establishment. This includes the sudden revelation that the U.S. would negotiate directly with Russia to end the war in Ukraine, but seemingly without the Europeans or Ukrainians involved. That development went down like a lead balloon in Berlin, especially considering Germany’s significant financial support of Kyiv since 2022.

Moreover, the German establishment has also frowned at a series of recent declarations by members of the Trump administration. Vice President JD Vance’s speech at the Munich Security Conference, in which he harshly criticized Europe for allegedly undermining freedom of expression, provoked clear pushback from German leaders. Trump, for his part, hardly endeared himself to his German allies when he denounced Ukrainian President Volodymyr Zelenskyy as a “dictator.”

[Riaz Haq]

India (8.3%) is the second largest importer of arms over the last 5 years (2019-2024). Ukraine (8.8%) is first. Pakistan (4.6%) 4th, according to SIPRI.

India's arms imports mainly from Russia, France and Israel.

Ukraine's from US, Germany and Poland.

Pakistan's from China, Netherlands and Turkey


https://www.sipri.org/media/press-release/2025/ukraine-worlds-bigge...

https://indianexpress.com/article/trending/top-10-listing/top-10-la...

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Chinese arms made up 81 per cent of Pakistan’s weapons imports in the past five years, as Islamabad buys more advanced systems from its long-standing Asian defence partner, according to data from Swedish think tank SIPRI.

https://www.scmp.com/news/china/military/article/3302515/china-supp...

That was up 7 percentage points from the previous five-year period to 2019, when 74 per cent of Pakistan’s arms imports came from China, the Stockholm International Peace Research Institute database shows.

The boost comes amid a huge push in China to improve self-reliance in its defence industry – from aircraft carriers to sixth-generation fighter jets – which has also seen it expand the range of weapons it can offer to its strategic partners.

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“The apparent willingness of China to supply or at least talk about supplying some of its more advanced weapons to Pakistan shows China’s trust in Pakistan,” said Siemon Wezeman, a senior arms transfers researcher at SIPRI.

China has been Pakistan’s primary arms supplier since the 1990s. But Pakistan’s tensions with India – especially since a series of border skirmishes broke out in 2016 – have prompted Islamabad to increase defence spending, and that has drawn it closer to Beijing.

Beijing avoids formal alliances but Wezeman said it could be seen as “Pakistan’s only real ‘ally’, the only one to depend on when dealing with India”.

At the same time, Pakistan plays a similar role for Beijing and is “the only one that at this moment could give China a secure access to a base on the Indian Ocean and near the Middle East”.

In April last year, China launched the first of eight Hangor II submarines to be delivered to Pakistan in a deal worth around US$5 billion – one of the most valuable military contracts China has signed.

According to the SIPRI database, some of Pakistan’s key orders in the past five years include the country’s first spy ship, the Rizwan, more than 600 VT-4 battle tanks, and 36 J-10CE 4.5-generation fighters.

The first delivery of multirole J-10CE fighter jets arrived in Pakistan in 2022, adding to its JF-17 fighters – a backbone model that makes up the bulk of Pakistan’s fleet.

The fourth-generation JF-17 was jointly developed by Pakistan Aeronautical Complex and China’s Chengdu Aircraft Industry Group in a programme that dates back to 1999.

The Block III version of JF-17 – featuring an active electronically scanned array radar – was inducted by the Pakistan Air Force in 2023.

Song Zhongping, a military commentator and former PLA instructor, said China might also export its fifth-generation fighter jet, the J-35, “if Pakistan requests it”.

He said that since India was considering adding the American F-35 or Russian Su-57 fifth-generation fighter jets to its fleet, Pakistan was likely to be considering its options too.

China also delivered a range of surface-to-air missiles and defence systems to Pakistan between 2020 and 2024, according to SIPRI. They included a long-range HQ-9 system with around 70 missiles, some 200 medium-range LY-80s, and about 890 low-altitude portable FN-6 missiles.

[Riaz Haq]

Riaz Haq
@haqsmusings
#Trump #Tariffs: #Vietnam (46%), #Thailand (36%), #Bangladesh (37%), #India 26%, #Pakistan (29%), and #SriLanka (44%) hit with steep new duties under sweeping trade order | Business Upturn

https://x.com/haqsmusings/status/1907541298971898015

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Trump's list of countries facing reciprocal tariffs, including Bangladesh, India, Pakistan and Sri Lanka

https://www.cnbc.com/2025/04/02/trump-reciprocal-tariffs-countries-...


Vietnam (46%), Thailand (36%), Bangladesh (37%), Pakistan (29%), and Sri Lanka (44%) hit with steep new duties under sweeping trade order

Vietnam: 46%
Thailand: 36%
Bangladesh: 37%
Pakistan: 29%
Sri Lanka: 44%
South Africa: 30%
Trump said, “We will charge them approximately half of what they are and have been charging us — this includes all forms of tariffs, non-monetary barriers, and other trade manipulations.”

The full list also includes:

China: 34%
European Union: 20%
Japan: 24%
India: 26%
South Korea: 25%
Taiwan: 32%
Malaysia: 24%
Indonesia: 32%
Switzerland: 31%
Israel: 17%
Philippines: 17%
United Kingdom: 10%
Brazil: 10%
Singapore: 10%
Chile: 10%
Trump emphasized this was not a full one-to-one tariff match but rather a proportional measure intended to rebalance trade relations. “This is going to be our Golden Age,” he declared.

The tariffs are expected to take effect immediately, with the auto and parts sectors seeing 25% duties starting Thursday, and additional product categories expected to follow.