Donald Trump’s tariffs on India signal that Washington, far from abandoning New Delhi, wants to see more effort and less hedging.
When the State Department finally placed the “Foreign Terrorist Organization” label on the Balochistan Liberation Army (BLA) and its suicide outfit, the Majeed Brigade, on August 11, most observers filed it under routine counterterrorism. BLA militants have spent years in violent struggle with the Pakistani state. Their actions have included the murder of Chinese teachers in Karachi, hijacking Pakistan’s Jaffar Express, and turning Gwadar—the centerpiece of the China-Pakistan Economic Corridor—into a terror zone. The US move thus can be seen as a long-overdue legal housekeeping.
However, the terror tag was rolled out the same week the White House doubled tariffs on Indian exports and tied any relief to New Delhi’s procurement of cheap Russian oil. This is hardly a coincidence, especially because Pakistani Authorities have long been claiming India’s backing of BLA terrorist activities in Pakistan.
The FTO designation, therefore, marks the opening chord of a new American play in South Asia. The United States is no longer treating India as a privileged partner exempt from cost, nor Pakistan as a mere appendage to Afghan policy. Instead, it is introducing conditionality as the organizing principle of its regional strategy.
Pakistan’s Narrow Window of Opportunity
The FTO designation establishes a more transparent, pragmatic channel for US-Pakistan cooperation, including force protection near foreign projects and intelligence sharing on insurgent financing. It also comes as US officials and businesses eye Balochistan’s buried riches—copper, lithium, and the rare-earth elements that power green tech and precision missiles.
Western firms will hardly invest billions in Reko Diq if BLA gunmen kidnap their engineers on the road. A practical, policeable counterterrorism compact could limit that risk without dragging Washington back into a 2000s-style security sinkhole. However, there is also a message meant for New Delhi.
The Price of Indian Strategic Hedging
Since the Russian invasion of Ukraine and the imposition of Western sanctions in 2022, India’s Russian crude imports rose precipitously, with refineries flipping barrels into lucrative export fuel. Russian oil accounted for more than one-third of India’s daily supply last year. In parallel, Indian companies shipped dual-use chemicals like HMX/octogen to Russian buyers, politely labelled “civilian.” New Delhi refers to this as “strategic autonomy.” Washington now sees it as sanctions sabotage and has decided to charge a fee.
The new tariff wall can be seen from that perspective. Roughly two-thirds of India’s $86 billion exports to the US market, from textiles to steel to jewelry, now sit behind an up to 50 percent gate. Every extra Russian barrel imported will cost New Delhi hard dollars and US market share.
Ending India’s Blank Check
For two decades, successive US administrations have granted India numerous privileges—nuclear waivers, technology transfers, prime seats in every Indo-Pacific forum—on the expectation that New Delhi would one day reciprocate and fully align with Washington against Beijing. That day keeps drifting into the future. India hasn’t started to toe the line, neither on Russia nor on export-control regimes. It still denies any hint of third-party mediation when a crisis erupts with Pakistan. In effect, Washington continued to extend credit while Delhi kept pocketing the balance.
The BLA designation rearranges the ledger. By carving out a Pakistan-only counterterrorism lane, the United States creates an option it can open or close without Indian endorsement. It won’t transform the region overnight, but it punctures Delhi’s subcontinental gatekeeper role and that alone rebalances the field.
The China Subtext
This is not a comfortable scenario for Beijing either. Chinese workers have been steady BLA targets; a US-Pakistan program that shields them—and, by extension, protects foreign capital—chips away at China’s claim to be the indispensable security provider in Balochistan. It also sends a message to smaller South Asian states that Washington still has a say in the regional game, even as it pressures the biggest player on the board.
Reciprocity, Not Rupture with India
Critics warn that squeezing India just pushes it deeper into Russia’s embrace. However, the partnership was already lopsided. India reaped advantages from the United States while disregarding US priorities. Conditional incentives are not a rupture; they are an attempt at receiving long-deferred reciprocity. New Delhi could still achieve what it values—advanced jet-engine co-production, supply-chain re-routing, and a vote of confidence in the Indo-Pacific, as long as it demonstrates its commitment.
Prime Minister Narendra Modi is confronting a tricky situation. Diversifying away from Russian crude will raise fuel prices at home, but ignoring Washington could stumble the very export industries underpinning his “Viksit Bharat 2047” growth plan. Filing a WTO case can buy time, but it will not necessarily provide relief.
Engaging in retaliatory tariffs risks a trade spiral India cannot win. A wiser approach should involve gradual, face-saving curbs on Russian barrels, a tougher line on dual-use exports, and renewed engagement for sector-specific deals that showcase US-Indian “friend-shoring.” The era of free hedging for India is over.
Toward a New, Sharper US-Partnership?
The United States is not pivoting to Pakistan, nor abandoning India. It is enforcing terms: secure the mine shafts, curb the Russian tap, and police the dual-use pipeline. Once these terms are met, the tariff gates may swing back open. Keep hedging, and the cost will rise. This is a far cry from betrayal. Rather, it is the maturation of a partnership that has outgrown its courtship phase and entered geopolitical crunch time.
In Washington’s new South Asia playbook, indulgence is out, reciprocity is in—and India, finally, must decide how much its strategic hedging is really worth.
About the Authors: Muhib Rahman and Nazmus Sakib
Dr. Muhib Rahman is a Perry World House Postdoctoral Fellow at the University of Pennsylvania.
Dr. Nazmus Sakib is a Lewis Lecturer at the University of Kentucky.
Image: Exposure Visuals / Shutterstock.com.
