Trade deal on track, but oil politics put India-US relations at risk: Experts

After a warm Diwali between Prime Minister Narendra Modi and US President Donald Trump, India-US trade discussions seem to be moving towards a conclusion, with both sides aiming for an ambitious bilateral agreement.

Mukesh Aghi, President and CEO of the US-India Strategic Partnership Forum (USISPF), said meaningful progress has been made on the trade front. He said that Indian negotiators have returned from Washington after preparing most of the outline.

“It is in the US interest. It is fundamentally in India’s interest to get the trade deal done.” needles Expressing optimism about the result.

Also read:

PM Modi thanked America President Trump wishes Diwali, reiterates commitments against terrorism

He said that while the discussions covered tariff and non-tariff barriers, the political mood between the two countries had significantly improved in recent weeks. Both governments are committed to keeping the partnership stable amid global uncertainty, he said.

Aghi clarified that the $100,000 fee on H-1B visas is temporary and valid for only one year, which will have limited impact on hiring. He said some lower-level jobs are going overseas, but demand for skilled Indian professionals remains strong in the US.

He emphasized the important role of Indian talent in the US tech ecosystem, noting that about 60% of US AI start-ups have an Indian connection. Aghi said the US should reform its immigration policy to address the shortage of skilled workers and maintain its competitive edge.

However, the talks are in trouble with Washington repeatedly mentioning India’s oil imports from Russia. President Trump recently said India would reduce such purchases – a comment analysts see as political pressure related to trade talks.

Read also, India-US trade talks showing progress, no major differences: Government sources

Former Foreign Secretary Kanwal Sibal said these comments complicate diplomacy.

“Trump is now saying this I’ve lost count how many times—that India should stop buying Russian oil, or India has agreed to stop buying Russian oil,” he said, calling repetition unnecessary and counterproductive.

Sibal stressed that India is ready to buy more US crude oil at a competitive price, but its energy ties with Russia should not be politicized or linked to trade discussions. He warned that such rhetoric could weaken the spirit of cooperation ahead of President Vladimir Putin’s upcoming visit to India.

Watch this video for more information.