India may become the first country to reach a trade agreement with the U.S.
In the past three years, India has skillfully maneuvered between Russia and the West due to the Russia-Ukraine war;
Biden organized the Indo-Pacific summit to rally support against China, but with Trump advocating for a ceasefire in Ukraine and the geopolitical focus shifting to the Middle East, India's international influence has somewhat weakened in the past six months, possibly intending to align with Trump.
India and Southeast Asia are in the same competitive ecological niche, both vying for the status of 'world factory.'
However, due to the unfavorable business environment, previous capacity transfers from Europe and the U.S. as well as China, Japan, and South Korea have largely flowed to Southeast Asia, which has dissatisfied India. With China and Southeast Asian countries facing high tariffs from the U.S., India believes the opportunity to capture market share has arrived.
It is worth noting that India has a long-term trade deficit in goods, but its service exports (primarily $340 billion in software outsourcing) are over 70% of its goods export value ($430 billion), and it has maintained a basic surplus, providing considerable flexibility for its diplomatic strategy.
