Modi Advocates for Local Products Amid Diplomatic Developments
Indian Prime Minister Narendra Modi encouraged citizens to support local businesses and is set to make a rare diplomatic visit to China as trade discussions with the United States hit a standstill.
According to sources within the Modi administration, he plans to visit China on Wednesday during the Shanghai Cooperation Organization (SCO) summit, a gathering that includes India and Pakistan, which participated in 2017.
Modi previously led the Indian delegation to the 2018 SCO Summit but hasn’t returned since. The organization has increasingly come under China’s influence, and relations between New Delhi and Beijing have been tense due to territorial and economic disputes over the past seven years.
China has repositioned the SCO as a counterweight to other global coalitions, taking a notably adversarial stance against the G7. Meanwhile, India has aimed to solidify its ties with Russia, also trying to bolster its own standing.
One significant impediment to India leveraging its SCO membership has been Pakistan’s involvement. During a recent SCO Defense Ministers’ meeting in China, Indian Defense Minister Rajnath Singh declined to sign the summit’s joint statement, citing terrorist activities in Kashmir linked to Pakistan.
Relations between India and China have somewhat improved since Modi met with Chinese leader Xi Jinping at a summit in October 2024 in Kazan, Russia, which also involved India as a member of another China-led group.
Russian President Vladimir Putin regarded the summit as a major diplomatic success for Russia, noting that two of its primary oil customers were mending fences, showcased by photographs of Modi and Xi together. This gathering indicated that U.S. attempts to isolate Putin after Ukraine’s invasion may not be as effective as hoped.
The Trump administration is keen to end India’s reliance on discounted Russian oil. India has publicly maintained its commercial relationships with Russia, but it seems negotiations are underway for alternative energy sources. Officials mentioned that declines in Russian oil imports may stem from reduced discounts rather than political concerns over funding military actions.
In response to ongoing issues, President Trump announced measures that could lead to a 25% tariff on Indian imports, specifically targeting India’s financial support for Russia amidst its involvement in Ukraine.
Trump’s statements previewing this action suggested similar tariffs might affect other countries engaging in similar trade practices. He expressed concerns over India’s substantial dealings with Russia, reinforcing that such transactions were fueling military efforts.
Ajit Doval, India’s National Security Advisor, is reportedly in Moscow emphasizing India’s oil strategy to secure deeper discounts from Russia to mitigate the impact of U.S. tariffs. Without access to Russian oil, India may be pressured into negotiating more favorable terms in both energy and military agreements.
Amid these international dealings, Modi has urged his fellow citizens to purchase locally made products during challenging economic times. He remarked that the current global economy is fraught with uncertainty and emphasized the importance of buying products “made from Indian sweat.”
At a recent rally, Modi hinted that protective tariffs on agriculture would continue to shield Indian farmers from foreign competition—another critical factor complicating trade talks with the U.S.
He stressed that the job security of farmers and small industries remains a priority. Furthermore, a major concern for the Trump administration is limiting the influence of China and its BRICS partners on the global stage, particularly regarding the dominance of the U.S. dollar in international trade.
Trump recently indicated that he would impose additional tariffs on nations supporting anti-American policies aligned with BRICS. Given India’s founding member status in BRICS, it’s perceived as potentially exempt from this stance, unlike Brazil, Russia, China, and South Africa.
As a result of the tariffs announced, India could face higher costs compared to several of its Southeast Asian competitors. The parameters of what would satisfy Trump are clear, and there is potential for the tariffs to be lifted if negotiations yield fruitful results. Now, it’s up to Modi to navigate these complex relations, balancing interests between the West and Russia. The outcome remains uncertain, reflecting the intricate dynamics at play.
