India and the World: January to March 2026
1. Trump 2.0: India-US Relations Under the Returning Administration
The context
Donald Trump returned to the White House in January 2025. His second term has been more structured and less chaotic than his first, but the core impulses remain: transactional bilateralism, suspicion of multilateral institutions, and a focus on trade deficits. For India, Trump 2.0 presents both opportunities and risks.
The H-1B and trade tensions
In February 2026, the US Congress passed the "America First Immigration Reform Act," which reduced the annual H-1B visa cap from 85,000 to 65,000 and introduced a "prevailing wage" requirement that effectively doubled the minimum salary for H-1B holders. Indian IT companies (TCS, Infosys, Wipro, HCL) were the most affected, as they account for approximately 60% of all H-1B visas. The Indian government's response was muted , a statement from the MEA expressing "concern" and a commitment to "constructive dialogue." Behind the scenes, the commerce ministry began exploring a mini trade deal that would offer tariff concessions on US agricultural exports (almonds, apples, pulses) in exchange for H-1B visa stability.
The defence and strategic cooperation
Despite trade frictions, defence cooperation deepened. In March 2026, India and the US concluded the "Indo-Pacific Maritime Security Framework," under which the US will provide India with 12 P-8I maritime patrol aircraft (India currently operates 12; this doubles the fleet) and co-develop undersea surveillance capabilities for the Indian Ocean. The framework explicitly references "countering coercive behaviour by revisionist powers in the Indo-Pacific" , diplomatic language for China.
2. India-France: The Horizon 2047 Roadmap
President Emmanuel Macron visited India as the Chief Guest for the Republic Day parade in January 2026 , his third Republic Day visit, the most by any foreign leader. The visit produced the "Horizon 2047" roadmap, a 25-year vision for India-France relations coinciding with India's centenary of independence.
Key outcomes:
| Area | Agreement |
|---|---|
| Defence | India to procure 26 Rafale-M (Marine) fighter jets for the INS Vikrant aircraft carrier. France to set up an MRO (maintenance, repair, overhaul) facility for the Rafale in Nagpur. Joint development of a next-generation fighter jet engine (the "Shakti" programme, following the GE F414 deal with the US) |
| Nuclear energy | France to build six EPR (European Pressurised Reactor) nuclear power plants at the Jaitapur site in Maharashtra. The stuck project received new momentum with a revised financing framework: France to provide €6 billion in concessional credit |
| Space | ISRO and CNES (the French space agency) to collaborate on the TRISHNA satellite for thermal mapping of Earth's surface. Joint participation in the Artemis Accords (the US-led framework for space exploration) |
| Indo-Pacific | A joint declaration on maritime security that explicitly mentions the "rules-based international order" and "freedom of navigation" , both coded references to China's South China Sea claims , but without naming China |
The strategic subtext
The India-France relationship has weathered two US administrations (Trump 1.0 and Biden), a UK prime ministerial crisis, and Russia's war in Ukraine without a single major disruption. It is the most stable of India's major bilateral relationships. The Horizon 2047 roadmap codifies this stability. For UPSC, this is a Mains-ready example of "strategic autonomy" , India can deepen ties with the US (GE engine deal), France (Rafale-M, Shakti engine), and Russia (S-400, oil imports) simultaneously without choosing sides.
3. Neighbourhood: Bangladesh, Maldives, and Sri Lanka
Bangladesh: political transition and its implications
Sheikh Hasina's Awami League government fell in August 2024 following student-led protests. An interim government under Muhammad Yunus has been in power since. India's relationship with Bangladesh, built on the Hasina-Modi personal equation, is being renegotiated. Key developments this quarter: the interim government raised the Teesta water-sharing issue (unresolved since 2011), sought a "balanced relationship" with both India and China, and raised concerns about the National Register of Citizens (NRC) in Assam affecting Bangladeshi nationals. India's response has been cautious: continued development assistance (₹200 crore for infrastructure projects) but no ministerial-level visits.
Maldives: the Muizzu pivot
President Mohamed Muizzu, who ran on an "India Out" platform in 2023, has moderated his position. In February 2026, he visited New Delhi and signed a defence cooperation agreement that allows India to maintain a "defence advisory presence" in the Maldives , a scaled-back version of the previous arrangement where Indian military personnel operated two helicopters and a Dornier aircraft. The agreement is a face-saving compromise: Muizzu can claim he removed Indian "troops," while India retains a strategic presence. India also restructured Maldivian debt: $200 million of the $400 million owed was converted into a grant.
Sri Lanka: the economic recovery and Indian investments
Sri Lanka's economy recovered faster than expected after the 2022 crisis. GDP grew by 4.5% in 2025, the highest since 2015. India's role has been central: India provided $4.5 billion in assistance during the crisis (the largest from any country), and Indian companies have invested in the Trincomalee oil tank farm, the Colombo port, and renewable energy projects. The Adani Group's wind power project in Mannar (northern Sri Lanka) was approved in March 2026 after environmental clearances. Chinese investments have also returned , the Hambantota port (leased to China Merchants Port Holdings for 99 years) remains a strategic concern for India.
4. Other IR developments this quarter
| Event | Date | Key Development | Prelims Fact |
|---|---|---|---|
| Pravasi Bharatiya Divas (Bhubaneswar) | January 2026 | 17th PBD. Theme: "Diaspora: Reliable Partners for Viksit Bharat." President of Trinidad and Tobago (Christine Kangaloo, of Indian origin) was the Chief Guest | Pravasi Bharatiya Divas is celebrated on January 9 (Gandhi's return from South Africa, 1915). Pravasi Bharatiya Samman is the highest honour for the diaspora |
| India-EU FTA negotiations: Round 9 | February 2026 | The 9th round of negotiations concluded in Brussels. Key sticking points: EU's demand for lower tariffs on automobiles and wine, India's demand for data secure status (essential for IT services exports) and easier movement of professionals. The target for conclusion is 2027 | India-EU FTA. BTIA (Broad-based Trade and Investment Agreement) is the formal name. Negotiations resumed in 2022 after a 9-year hiatus |
| SCO Defence Ministers' Meeting (Astana) | March 2026 | Defence Minister attended. Focus on counter-terrorism cooperation. India reiterated its position on cross-border terrorism without naming Pakistan. India also raised the issue of Afghanistan's stability | SCO: 9 members (India, Pakistan, China, Russia, Kazakhstan, Kyrgyzstan, Tajikistan, Uzbekistan, Iran). 3 observer states. RATS (Regional Anti-Terrorist Structure) is based in Tashkent |
For broader context on India's foreign policy, read our guide on climate change agreements and India's global role.