Democrats' rise in US: India must learn to navigate through uncertainty

Democrats have won both the US House and Senate, but US President Trump's unpredictable trade moves are unlikely to stop. For India, that means a trade deal that is harder to close and a greater need for patience.

Democrats swept both the US House and Senate, in a stunning rebuke to US President Donald Trump, whose autocratic and authoritative style backfired on his home turf.

Trump's self-assessment declaring himself 'the greatest' president in US history, while he categorised great American leaders like Abraham Lincoln, George Washington and F. D. Roosevelt as simply 'great' in his Truth Social post on 27 August 2026, now stands exposed.

This marks the beginning of the end of Trump and his imperialistic ambitions in trade and geopolitics alike.

The election results reveal that US citizens rejected his indiscriminate imposition of tariffs, repeated economic and political threats, arbitrary withdrawal from UN organisations and imperialistic aggression on countries such as Venezuela, Iran, and Greenland, to name a few.

When Trump's tariffs kicked in, India was hit twice: a 25% reciprocal duty, then another 25% as a penalty for buying Russian oil. That made 50% in all, stacked on top of the regular duties the US already charges. Those are steepest on textiles, garments and other labour-intensive goods, exactly the exports India leans on most.

However, the US Supreme Court struck down the reciprocal tariff system imposed under the International Emergency Economic Powers Act (IEEPA) of 1997 on 20 February 2026, and the US government was ordered to refund over $168 billion in duties collected.

However, this did not restrain Trump from using his presidential powers to impose tariffs under one pretext or another, continuing to wage a trade war. Trump exercised his powers under Section 122 of the Trade Act of 1974 to impose 10% universal global tariffs in addition to MFN tariffs.

A trade deal that has not arrived

Interestingly, as predicted, soon after the expiry of tariffs under Section 122, President Trump unilaterally invoked Section 301 to impose a 10% additional levy on Indian exports, on the pretext of supply-chain labour conditions and trade practices.

In September, Trump signed the Lindsey O. Graham Sanctioning Russia and Iran Act, which opened the door to 100% tariffs on countries buying Russian oil. Then, on 16 October, he waived it with an executive order. Within weeks, a tough new law was effectively put on hold, which says a lot about how hard it is to predict where US trade policy is headed.

On 2 February 2026, Trump said, 'we immediately agreed to a trade deal between the US and India'. A week later, reports said he had announced one again. Then more reports followed, and still there has been no deal. All that back-and-forth left businesses in both countries guessing what would happen next, and it has hurt trade and investment.

Though the election results are widely hailed by leaders and businesses across the world, one should never forget that a divided Washington may add to an era of greater geopolitical uncertainty before it stabilises.

The entry of software and IT professionals has been a concern for both political parties amid increasingly restrictive measures, whereas defence cooperation has support from both parties and is likely to continue and flourish. US economic and fiscal policies are likely to affect global financial and capital markets, as well as investment flows.

A tough road to the trade pact

Democrats, a majority in Congress, may restrain Trump's aggression toward Iran and support war de-escalation, leading to lower petroleum prices. It would reduce India's petroleum import bill and positively impact the Indian economy in general, as India is import-dependent for over 89% of its petroleum needs.

Trump has been very predictable in his unpredictability, and that is going to persist.

Equitable and competitive access to the US market is extremely important for the India-US trade relationship, as the US is India's largest export market, accounting for over 20% of India's exports.

Moreover, US is the world's largest economy, with over $30 trillion in GDP, offering the world's largest market. India and the US both say they settled the first part of their trade deal in October 2026. Sensitive Indian sectors such as dairy are protected, and farming gets some cover too. But the harder part is still ahead: turning this into a final agreement and getting it past the US Congress, which now looks tougher than it did.

Though most experts view the rise of Democrats as an effort to curb unilateral presidential tariff powers, it seems overly simplistic. The unpredictability of Trump in exercising executive power, or in swiftly claiming the bilateral trade agreement as finalised and a political win for his domestic constituency, makes congressional approval much more complex than before.

Indian trade negotiators worked both meticulously and tirelessly over the years with utmost unpredictability. The Bhagavad Gita verse 'Karmanye va adhkaraste, ma faleshu kadachan' meaning 'You have the right to perform your prescribed duty, but you are not entitled to the fruits of your actions', seems to be the ultimate mantra for the negotiating team and the policymakers to continue negotiating despite repeated setbacks, anticipating ultimate success.