Why this is important to Wisconsin businesses: Despite tensions, a June meeting between President Trump and Prime Minister Modi led to agreements in areas including trade and investment, defense, immigration, energy, entrepreneurship and fighting terrorism.
Indian Prime Minister Narendra Modi had his first meeting with U.S. President Donald Trump on June 25-26. This was the Prime Minister’s fifth visit to the U.S. since taking office in 2014. Modi’s visit came in the midst of the Trump administration’s curb on immigration, tightening the rules on the H-1B visa program, as well as the decision to withdraw from the Paris climate accord, where Trump singled out India as the country that was unfairly benefiting from the accord. However, analysts said President Trump's meeting with Prime Minister Modi was a "tremendous success."
Key takeaways from the Modi-Trump meeting included:
- Both leaders look forward to creating a trade relationship between the two nations that is “fair and reciprocal.” President Trump called for the removal of barriers to the export of U.S. goods into Indian markets. India is currently America’s ninth-largest goods trading partner, with $68 billion in total (two-way) goods traded during 2016. U.S. goods exports to India in 2016 were $22 billion, while U.S. goods imports from India totaled $46.0 billion in the same year. Thus, the U.S. trade deficit with India for goods was $24 billion in 2016.
- The U.S. State Department approved the possible sale to India of a Boeing C-17 transport aircraft at an estimated cost of $366 million.
- Ahead of Modi’s visit, the U.S. cleared the sale of 22 unmanned Guardian drones to India at an estimated cost of between $2 billion and $3 billion.
- Prime Minister Modi met with the CEOs of major global companies based in the U.S. on issues ranging from visas to investment. Job creation occupied center stage during these discussions, which were attended by Apple chief Tim Cook, Walmart head Doug McMillon, Caterpillar’s Jim Umpleby, Google head Sundar Pichai and Microsoft’s Satya Nadella.
- President Trump and Prime Minister Modi also vowed to strengthen efforts to fight terrorism and eliminate safe havens for terrorists.
- The U.S. looks forward to exporting more American energy to India, including major long-term contracts to purchase American natural gas.
- Starting next year, liquefied natural gas (LNG) from the U.S. will flow to India. The expected trade value in the coming years would be in excess of $40 billion.
- Prime Minister Modi invited the President's daughter, Ivanka Trump, to India for an Entrepreneurship Summit scheduled to take place later this year.
Modi and Trump issued a joint statement in which they touched upon regional and global economic issues, including bolstering strategic and economic ties, enhancing defense partnership and exchanging technology.
The Modi Government’s Make In India campaign aims to make India a global manufacturing hub. The government has been encouraging foreign companies to set up production facilities in the country, and many, including several major U.S. firms, have done so. Apple recently began assembling iPhones in India, while American aerospace giant Lockheed Martin (LMT) will make and export F-16 fighter jets from the country if it wins a big order from the Indian Air Force. Ford said in November 2016 that it will be the first automaker to import vehicles to the U.S. from India, starting in 2018. Wisconsin companies can take advantage of the Make in India initiative, and ease of doing business is one of the prime objectives of the Modi government.