US ‘colder’ towards India as it sees us as rival in market for resources: CEA Nageswaran

The second Trump administration has been viewed more negatively by India, according to Chief Economic Advisor V Anantha Nageswaran. He believes the US sees India as a rival in the market for resources, rather than a simple partner or ally. This perspective arises because India also competes with the US in securing resources necessary for manufacturing, such as refining capacity and rare earth elements.

Nageswaran emphasized that US geopolitical strategies frequently shift between viewing India as an ally and a rival, contingent upon India's resource availability. This dynamic, he stated, will influence economic goals over the next 20 years and add volatility to global trade. Furthermore, Nageswaran highlighted that recent US visits to India for resource-related discussions, like those in Jamnagar and Mumbai, are strategic moves to gauge India's allegiance in the evolving geopolitical landscape.

He also pointed out that the race for resources like green technologies and rare materials is not confined to developing nations alone, as advanced economies, including the US and Germany, are also competing for investments. Despite India attracting significant foreign direct investment (FDI), the net FDI has declined due to increased domestic investment and repatriation of foreign funds.

Nageswaran remains optimistic about India’s economic prospects, noting potential benefits from new trade agreements, particularly in labor-intensive manufacturing and services. However, he stressed the need for India to establish resource buffers, including industrial metals, fertilizers, and pharmaceutical ingredients, to sustain economic growth amidst resource-driven competition.