India has in recent years strengthened its ties with the U.S. in bilateral trade and defense deals, but the relationship faces headwinds on several fronts. Among the sensitive areas are potential economic sanctions following India’s defense dealings with Russia, India’s worries over some of President Trump’s policies, and U.S. immigration restrictions on work visas.
A recent, significant challenge is that India risks U.S. sanctions over its recently concluded $5 billion deal to buy air defense missile systems from Russia. The U.S. imposed sanctions on Russia for meddling in America’s 2016 presidential elections; those sanctions could extend to any country doing large defense deals with Russia. If the U.S. were to impose sanctions on India, this could jeopardize banking relationships between the two countries, including money transfers, noted Marshall M. Bouton, acting director and visiting scholar at the University of Pennsylvania’s Center for the Advanced Study of India (CASI). According to Bouton, India has informed the U.S. that the deal to buy the Russian S-400 long-range surface-to-air missile system will not impinge on its ties with the U.S. He made those remarks in his keynote address at the Wharton India Economic Forum last week in Philadelphia.
