Why Modi’s shifting India away from US toward China
India and China have recently agreed to disengage from their prolonged border standoff in the western sector of the India-China Himalayan border on the sidelines of 16th BRICS summit. Tensions have simmered since June 15, 2020, after 20 Indian and an unknown number of Chinese soldiers were killed in a high-mountain clash.
China’s main grievance with India emerged after Prime Minister Narendra Modi came to power and began strengthening ties with the United States. India started signing agreements that effectively designated it as a US partner and ally in South Asia.
China perceived this as part of Washington’s broader “China containment policy,” which was central to former President Barack Obama’s “Pivot to Asia” strategy during his second term. In response, China sought to pressure India, aiming to keep it from becoming too closely aligned with the US.
On August 29, 2016, India signed an adapted version of the Logistics Exchange Memorandum of Agreement (LEMOA) with the US. In response, China ramped up pressure on India, particularly at the Doklam tri-junction, where the borders of Bhutan, China and India converge.
In an effort to ease tensions, India’s then-foreign secretary, Subrahmanyam Jaishankar, visited Beijing and assured his Chinese counterparts that India was committed to resolving differences through a high-level mechanism.
This led to the first informal summit between Modi and Chinese President Xi Jinping in Wuhan, China, on April 27–28, 2018, where both leaders discussed and agreed on various issues to manage their differences.
Despite Modi’s assurances to China, India went ahead and signed another foundational agreement with the US — the Communications and Information Security Memorandum of Agreement (CISMOA) — on September 6, 2018, on the sidelines of the inaugural 2+2 dialogue between the two countries.
On October 11-12, 2019, the second informal summit between Modi and Xi took place in Mahabalipuram, Tamil Nadu. The summit, however, appeared to be a failure, likely due to Modi’s decision to align more closely with the US by agreeing to a third foundational agreement. It’s possible that Modi bluntly responded to Xi of India’s intention to formalize its partnership with the US during their discussions.
This assumption is supported by Xi’s subsequent statement during an official visit to Kathmandu, Nepal, directly after the Mahabalipuram summit. There, Xi warned that “anyone attempting to split China in any part of the country will end in crushed bodies and shattered bones,” which could have been interpreted as a veiled response to India’s growing ties with the US.
Following the deadly clashes in Galwan on June 15, 2020, the Indian media—often referred to as “Godi media” for its pro-Modi stance—launched an intense anti-China propaganda campaign. Despite China’s concerns and Modi’s earlier assurances to Xi at the Wuhan summit, India continued to strengthen its ties with the US.
On October 26, 2020, India signed its fourth foundational agreements with the US, namely the Basic Exchange and Cooperation Agreement for Geospatial Intelligence (BECA), further solidifying its alliance. This followed the earlier signing of the General Security of Military Information Agreement (GSOMIA) in 2002. By moving forward with these agreements, India formally aligned itself with the US, disregarding Chinese objections.
Modi appeared confident that his close relationship with then-US President Donald Trump would secure preferential access to US markets and technology for India. During his visit to the US, Modi even campaigned for Trump’s re-election at the “Howdy, Modi!” event in Houston, Texas, where he famously cheered, “‘Abki Baar, Trump Sarkar’, rang loud and clear.” (meaning “Next term, Trump’s government”).
At the time, high-ranking US officials frequently claimed that a caravan of American companies would relocate from China to India. However, this shift never substantially materialized, and US investment in India remains minimal. Instead, India’s trade dependence on China has increased significantly.
In his second term in 2019, Modi appointed S Jaishankar as foreign minister, hoping that his pro-American stance would help attract US investment and technology, while also securing preferential access for Indian goods in American markets—similar to what China achieved in the 1990s.
However, the role of the US government in its economy is largely limited to creating a legal framework for international trade and investment through treaties and regulations. The task of fostering a conducive investment environment falls to the host country, which American investors have long felt is lacking in India. Instead of increased US investment, major American companies like Ford, General Motors and Harley-Davidson exited the Indian market during this period.
Recently, it was hoped that assembling Apple’s iPhones in India would be a successful venture. However, the initiative faced significant setbacks due to high rejection rate of 50%, and concerns over E coli bacteria contamination, and lower worker productivity compared to China. As a result, the economic benefits India expected from aligning with the US and becoming its partner have not materialized as anticipated.
On the geopolitical front, meanwhile, India lost significantly. It once viewed South Asia and the Indian Ocean as its traditional sphere of influence, but after becoming a US ally, none of its neighboring countries remain within its sphere. Instead, India has arguably become more of a subordinate ally to the US.
This was evident when the US conducted a Freedom of Navigation Operation (FONOPS) in the Indian Ocean on April 7, 2021, which sparked a strong backlash in Indian media and academia, despite India being a US partner. Additionally, the US has been accused of fueling anti-India sentiment in neighboring countries and covertly helping to oust pro-Indian governments in Sri Lanka, Nepal, and the Maldives.
This made India realize that the US expects it to relinquish its “strategic autonomy” and that India’s claims to a regional sphere of influence in South Asia are unacceptable to Washington.
Henry Kissinger famously remarked, “It may be dangerous to be America’s enemy, but to be America’s friend is fatal.” This sentiment seems to fit India’s experience perfectly. The US continued to exert political pressure on India at international events.
Meanwhile, despite India’s rhetorical trade restrictions on Chinese goods, its trade with China continued to grow. India’s increased trade with the US was largely driven by its rising imports from China. This dynamic revealed that while India needs China for its economic growth, China does not have the same dependence on India.
Ultimately, after four years of experimenting with foreign policy, the Modi government came to understand that China’s cooperation is essential for India’s economic development. The prime minister’s economic adviser argued that China would likely refrain from interfering in India’s border issues due to its dependence on India, coupled with the prospect of increased Chinese investment.
On the other hand, following the Ukraine war, the West intensified pressure on India to oppose Russia. The US warned India of consequences if it continued to purchase Russian oil and insisted that India abandon its relations with Russia, promising in return to provide arms.
Despite this pressure, India has continued to buy cheap Russian oil and is currently Russia’s largest oil buyer. Russia accounts for approximately 36% of India’s arms imports. The US pressure on India to refrain from purchasing arms and oil from Russia runs counter to India’s national interests.
Recently, the US and Canada have been applying pressure on India to distance itself from China and to quit BRICS. This effort was highlighted by Canada’s expulsion of Indian diplomats following the murder of Hardeep Singh Nijjar. Additionally, the US Department of Justice has initiated proceedings against an Indian government employee in connection with the alleged attempted murder of Sikh separatist Gurpatwant Singh Pannun.
Modi’s allies now recognize that maintaining a relationship with China is crucial for India’s economic development. Should China impose trade restrictions on India, the country would face significant challenges. The US can no longer offer the same advantages to India that it provided to China in the 1990s.
Furthermore, the agreements to establish an alliance with the US have proven ineffective in applying pressure on China. Modi has come to understand that India cannot secure preferential market access, technology or investment from the US due to its protectionist industrial and international trade policies, which favor bringing manufacturing back to America. Consequently, he has also acknowledged that India can seek technology, investment and market opportunities from China.
To withstand American pressure, Dr Manmohan Singh’s government was arguably more resilient than any other administration in India. Before the 2014 elections, the US exerted significant pressure on India to support its “Pivot to Asia” policy.
However, Singh’s government resisted these demands. Tensions escalated when the US arrested and strip-searched Indian diplomat Devyani Khobragade, prompting a significant backlash in India. In response, the Singh administration withdrew the privileges of US Ambassador to India, Nancy J Powell. Upon her return to the US, she resigned as ambassador and went through immigration like any other US citizen.
In a show of defiance, Delhi Police removed barricades in front of the US Embassy in New Delhi and schools and businesses associated with the US faced bans. Although Singh lost the subsequent election six months later, he maintained his stance against becoming an ally of the US. Instead, he pursued a policy aimed at advancing economic development through partnerships with China, choosing to temporarily set aside the border dispute.
Conversely, Modi’s policy aimed at becoming a steadfast ally and partner of the US, which was intended to serve India’s interests, has proven to be fundamentally misguided. The ongoing border tensions with China have diverted India’s national priorities and squandered scarce financial resources. Modi has come to understand the truth in Kissinger’s words about the dangers of being America’s friend.
The first and second terms of Modi’s government have marked one of the worst decades in India’s history in regard to international relations. During this period, India has incurred unprecedented opportunity costs while experimenting with international and geopolitical strategies. In his third term, Modi is looking to reverse the course by shifting from the US to China.
