On January 20, 2025, India’s foreign minister was seated in the front row for President Trump’s second inauguration, a symbol of our special relationship with the world’s most populous democratic country.

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Eight months later, after the Trump/Vance administration slapped the highest tariff rate in the world on India, a photo emerged of Vladimir Putin and Xi Jinping with Indian Prime Minister Narendra Modi. The photo was taken in September 2025 at the Tianjin summit of the Shanghai Cooperation Organization, which was attended by 20 foreign leaders, including the leaders of Egypt, Iran, Pakistan, Turkey, Belarus and Central Asian and Caucasus states (although Kim Jong Un didn’t attend the summit, he joined the group later for the infamous Chinese military parade).

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In response to the alarming photo, President Trump posted: “Looks like we’ve lost India and Russia to deepest, darkest, China. May they have a long and prosperous future together!” – as if he had nothing to do with it.

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As of late August 2026, the comprehensive U.S.–India Free Trade Agreement that was negotiated in February is still not completed, but regardless of what happens with it, major damage has already been done … which may be one of the most outrageously irresponsible things the Trump/Vance administration has done yet regarding one of our closest allies.

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For one, India is absolutely critical to our Indo-Pacific national security strategy. China’s aggressive moves in the Indian Ocean make it imperative that the United States and India have even more bilateral defense cooperation, certainly not less (more on this in a few minutes). India is also our best economic hedge against China. It is a vital geopolitical counterweight, offering supply chain diversification and a massive workforce with expanding manufacturing capabilities.

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Before Donald Trump’s reelection, many American and multinational companies had begun planning major investments in India as part of what is known as “China Plus One” – a strategy in which companies reduce their dependence on China by adding manufacturing and sourcing capacity in other countries. India emerged as one of the leading beneficiaries. But in August 2025, the Trump/Vance administration levied tariffs reaching 50 percent on many Indian exports to the United States, including an additional 25 percent penalty tied to India’s purchases of Russian oil. The tariffs weakened India’s cost advantage for U.S.-bound manufacturing and threatened to undercut some of the progress it had made in attracting supply chains away from China.

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What happened next was entirely predictable because the minute the United States turned into a bully and started acting shady and shifty, India had little choice but to turn to Beijing. Prime Minister Modi immediately booked passage to China, his first trip there in seven years.

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China and India have an extremely complicated relationship, complete with soldiers facing off across their disputed borders in the Himalayas. That said, in classic Phase Two fashion, Xi Jinping is eager to cooperate with Prime Minister Modi, at least economically, because once again he recognizes what Donald Trump and JD Vance obviously don’t: India is a massive market with 1.47 billion customers.

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Measured at current exchange rates, India is among the world’s five largest economies and is rapidly moving up the rankings as it closes the gap with Japan and Germany. The Indian government has explicitly set its sights on becoming the world’s third-largest economy. On a purchasing-power-parity basis, India has already achieved that ranking and accounts for roughly 8–10 percent of global economic output.