On 12th February, ten central trade unions announced one a day general strike in continuation of their struggle against new labour codes that completely undermine even the basic rights of workers. This is with the background of a changing economic situation in India following Trump’s coming to power for a second term.
Trump inaugurated his policy of weaponising tariffs in August 2025. India was among the few countries on which the axe fell harder. In addition to 25% ‘reciprocal’ tariff, another 25% tariff was announced as penalty for continued Russian oil imports, thus making it a whopping 50% duty, among the highest imposed on any trade partner.
This was unprecedented and quite shocking for Modi regime that had been running the false propaganda of India’s clout having raised significantly under its leadership. Modi claimed to have had personal rapport with Trump. Earlier he had openly urged the Indian diaspora in US to vote for Trump. With that backdrop, it was shocking, if not humiliating, for the Indian government. The issue at hand however was not just national but global with many countries facing the heat of Trump’s policy.
On 1 Sept 2025, precisely a month after US had announced tariffs, the photos of Modi, Putting and Jinping cozying up and sharing laughs emerged. The occasion was a high profile SCO (Shanghai Cooperation Organization) meeting in China where the “supreme leaders” of these three big nations met together. The Tianjin Declaration adopted by the SCO leaders condemned ‘unilateral coercive measures, including those of an economic nature’ that violate United Nations and World Trade Organization (WTO) principles, a veiled condemnation of Trump policies. It further reaffirmed support to a rules-based multilateral trading system and the WTO framework. Considering these three major nations now had direct stakes involved in countering the “Big bully”, the meeting was anticipated by few to usher in redrawing of global geopolitics and economics.
In December, when Putin visited India, defying western pressure, Modi rolled out red carpet for him. Notwithstanding these moves, the diplomatic efforts to secure the trade deal with US were constantly being made. The key sectors with heavy reliance on US markets had started feeling the heat. Labor intensive sectors, like textile, leather and jewellery, were among the worst hit. And not to mention that deep distrust with China had been all too pervasive. So, as time moved, it was becoming clear that some kind of deal would have to cut, sooner or later. And that is what happened in the first week of February, when Indo-US trade deal was announced for the first time.
This was 10 days after India-EU Free Trade Agreement was announced on 27th January 2026. The difference however was starker. Unlike the India-EU deal announcement that was accompanied by significant fanfare, followed by jingoistic media coverage, the announcement of India-US deal was conspicuously muted. As more details emerged, it became clearer that deal was disproportionately skewed against India. While the details announced so far have many opened ended phrases, the ones related to agriculture are of significant concern. With the deal, the domestic market would be partly opened up for US agricultural products, with lowered or no tariff. In addition to soyabean oil, processed foods, various animal feed products like red sorghum may hit the Indian market. Imports of DDGS (Distiller Dried Grains with Solubles) threatens to displace domestic soy-based feed production.
Crisis ridden agricultural sector
In a crisis ridden agricultural sector, there are only few crops like maize and soyabean which provide farmers with at least bare minimum assurance of selling price. Additionally, it seems that India has been coerced in pledging to buy more US goods in non-farm sectors. All this would have significant impact undermining livelihood of millions of farmers and working masses dependent on those agri, and non-agri sectors.
While the extent and nature of the full economic impact of the deal would take some time to surface, what has become starkly clear is that the deal greatly undermines the authority of Indian government. Trump’s pompous claim of India having agreed to cease Russian oil imports, followed by an announcement to a set up monitoring mechanism to track the trade, are seen as attack on the sovereignty. While the government engaged in cheap media propaganda to save its face, the sheer optics of the deal are too conspicuous to miss. The deal has thoroughly exposed the vulnerabilities of the Indian capitalism, in general, and the Modi government in particular.
This however has much larger significance going beyond the personalities of Trump or Modi. After all, what Trump represents is the ugly face of US imperialism that has consistently adopted coercive powers to further the interests of its capitalist class. It is in this backdrop that the capitulation of Indian bourgeoisie in the face of US bullying could have wider consequences. After independence, India under Nehru, in association with Tito in Yugoslavia and Naseer in Egypt, launched a non-alignment movement that had had some echo among the ‘global south’. While there could not be any genuine anti-imperialist position without a break from capitalism, the Indian bourgeoisie at least projected the image of anti-imperialism. For example, it consistently opposed Isreal imperialist occupation of Palestine lands supporting latter’s right to self-determination. This has significantly changed under this government. In a display of subservience, it even refused to condemn the outrageous kidnapping of Venezuelan President by US military.
Workers, farmers, and the poor have had their rights and conditions undermined by these deals and capitalist manoeuvres. Anger is beginning to mount. On 12th February, ten central trade unions announced one a day general strike in continuation of its struggle against new labour codes that completely undermine even the basic rights of workers. The call was supported by Samyukta Kisan Morcha (United Farmers’ front) and one of the demands of the general strike had been to withdraw the provisions of agreement that compromise the interests of working masses. Such solidarity between workers and farmers is a welcome initiative. The successful campaign by farmers repelling anti-farmer laws in 2020 has left the strong legacy of struggles. However, going beyond such occasional struggles, the working class leadership would have to initiate a sustained campaign to defeat the anti-working class government.