Presenting her maiden budget on July 5 India’s Finance Minister Nirmala Sitharaman signaled her ambition to transform India into a $5 trillion economy by 2025. No doubt India has the potential to achieve this goal but succeeding requires recognizing and addressing the challenges it faces.

Unexpectedly, a primary obstacle to India’s ambitions is the United States itself, as evidenced by the stalled and frustrating trade talks between Delhi and Washington. Disagreements about data privacy, e-commerce, the medical device price cap, dairy, and now foreign direct investment (FDI) into the insurance sector are all contributing to the on-going trade impasse and growing tensions. Going by the US administration’s recent public statements, there is little reason to be optimistic for progress, and more reason to believe that harder times lie ahead for the bilateral trade relationship.

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On a visit to New Delhi this week, US Secretary of State Mike Pompeo was informed by Indian Foreign Minister S. Jaishankar that India will do “what is in our national interest” when it comes to purchasing a Russian missile defense system. Despite US pressure and the threat of sanctions, the Indian government has no plans to scrap a deal to purchase the Russian S-400 air and missile defense system.

Ahead of Pompeo’s visit to India on June 25 and 26, State Department officials had urged “allies and partners, including India, to forgo transactions with Russia that risk triggering the CAATSA sanctions.” The 2017 Countering America's Adversaries Through Sanctions Act (CAATSA) threatens to sanction countries for buying Russian weapons.

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Indian Prime Minister Narendra Modi led his party to a resounding electoral victory on May 23. Modi, who leads the Hindu nationalist Bharatiya Janata Party (BJP), defied most predictions by expanding his party’s presence in the Lok Sabha, the lower house of India’s Parliament. The BJP is projected to win 303 of the 543 seats in the Lok Sabha. The main opposition alliance, led by the Indian National Congress, has admitted defeat.


The big question now is how Modi will use his second five-year term at the helm of the world’s largest democracy. India faces plenty of challenges: a high unemployment rate, slow economic growth, changing geopolitical relationships, border security issues, and a deepening religious divide.

Here is a quick look at how Modi handled these issues in his first term and what he will need to focus on in the next five years.

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India, the world’s largest democracy, kicked off a five-week-long parliamentary election on April 11. Unlike the United States, where the Democratic and Republican parties dominate, India is a multiparty system, giving voters a choice of candidates.


At the national level, the Hindu nationalist Bharatiya Janata Party (BJP) led by Prime Minister Narendra Modi and the secular Indian National Congress led by Rahul Gandhi, whose father, grandmother, and great grandfather all served as prime ministers of India, are in a fight to lead the country. Modi has served as prime minister for the past five years.

This handy guide will help you make sense of the contest.

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Trump signals end to preferential trade treatment for India

In a letter to the US Congress on March 4, US President Donald J. Trump wrote that he intends to end preferential trade treatment for India. Trump wrote that he had taken the decision because “after intensive engagement between the United States and the Government of India, I have determined that India has not assured the United States that it will provide equitable and reasonable access to the markets of India.” It is important to assess exactly what this decision means and consider the full range of implications for the US-India trade relationship.

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Even in this eventful week, nothing came close to matching the perilous significance of the unprecedented airstrikes between Pakistan and India, escalating the risk of war between two nuclear powers.


Headlines in the United States focused more on President Donald Trump's former lawyer turning on him before Congress and on the president's fruitless Vietnam meeting with North Korean dictator Kim Jong Un. Though that made for one of the Trump administration's more difficult weeks, it is the South Asian nail-biter that deserves our urgent attention.

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The Indian Air Force strike on what India claims was a terrorist camp in Balakot, Pakistan, on February 26 followed by the Pakistani air strike on targets in India-administered Kashmir have placed both countries on a perilous path to war. The escalation ladder on any such military actions between these two nuclear-armed neighbors remains very steep. Each is equipped with standoff weapons that can be launched from air platforms without sending troops across their border, and increasingly have been talking of the use of miniaturized nuclear weapons euphemistically labeled “tactical.” Once they reach that level, a full-scale war, involving dozens of nuclear weapons could engulf the subcontinent with grave consequences for the whole region and the world. Nuclear Winter, the shutting off sunlight from the Northern Hemisphere of the globe, would mean no light or food for the world. This is not science fiction but reality. Hence, it is critical that leaders in India and Pakistan defuse the current situation before it becomes impossible to retrieve.

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