Modi May Face 2008-Like Crisis in High-Stakes US Trade Talks
US President Donald Trump & India PM Narendra Modi (Image credit X.com, File)
RSS Affiliates Draw Red Lines as Trump Pushes to “Open Up India,” Risking Political Turbulence for BJP
By MANISH ANAND
NEW DELHI, June 30, 2025 – US President Donald Trump’s self-imposed pause on reciprocal tariffs is nearing its end, with just 18 days remaining. Yet, a much-anticipated India-US trade deal remains elusive, and prospects are growing increasingly dim.
Prime Minister Narendra Modi now faces a challenge reminiscent of the one his predecessor, Manmohan Singh, encountered in 2008 during the political storm over the India-US civil nuclear deal. But Modi’s situation could prove even more difficult, with affiliates of the Rashtriya Swayamsevak Sangh (RSS) already drawing clear Laxman Rekhas—non-negotiable red lines.
“A trade deal with India is not possible because what America is demanding, India cannot give. How can India allow America’s GM [genetically modified] and other agricultural products to enter, or accept non-veg milk and dairy in the country? How can our agriculture and small industries be sacrificed before America’s stubbornness?” wrote Ashwini Mahajan, co-convenor of the Swadeshi Jagran Manch (SJM), an RSS affiliate, on X.
In Modi’s first term, it was largely due to pressure from the SJM that the government abandoned its push for GM crops. NITI Aayog, the government’s think tank, stopped advocating for GM technologies after two years of pushback. Field trials for GM brinjal and GM mustard never progressed, thanks to the RSS’s firm opposition.
Yet Trump continues to assert that he will “open up India,” claiming the country is a “closed market” and vowing to force access. While tough negotiations are reportedly ongoing, signs of concessions have emerged. Media reports indicate that Tesla may soon begin selling “Made in China” electric vehicles in India.
Trump seems oblivious to the domestic political consequences his rhetoric may trigger for Modi. “Nothing riles Indians more than the idea that their government was bullied by a foreign leader. A trade bargain that could have been a win-win deal now risks being portrayed by opponents as a tribute, not a partnership,” Politico quoted Syed Akbaruddin, India’s former ambassador to the United Nations, as saying.
The magazine even suggested that such a trade deal could prove “suicidal” for India. Commentators point to recent outrage from the Congress Party after Trump claimed—more than a dozen times—that he brokered the India-Pakistan ceasefire by “promising more trade with the US to both countries.”
In an effort to set the record straight, Modi spoke to Trump by phone from Canada after the two leaders missed a meeting on the sidelines of the G7 Outreach Summit. Modi reportedly told Trump that the India-Pakistan ceasefire was agreed upon bilaterally, “without the involvement of anyone else.” Still, Trump has refused to align with Modi’s version, continuing to tout his peacemaking role as a matter of habit.
The SJM is joined by other RSS affiliates such as Laghu Udyog Bharati and Bharatiya Kisan Sangh, which represent the interests of small industries and farmers, respectively. These groups were also credited with stalling major economic reforms during the final years of Prime Minister Atal Bihari Vajpayee’s tenure.
Politically, Modi appears to lack the same momentum he carried in his first two terms. The Bharatiya Janata Party (BJP) no longer holds a majority on its own in the Lok Sabha. With Bihar Assembly elections just four months away and high-stakes state elections in Assam, Uttar Pradesh, Gujarat, and others lined up for 2026 and 2027, the Modi government is unlikely to risk a politically costly trade agreement.
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