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Trump’s return to power has reshaped America’s energy policy—forcing India to balance pragmatism, resilience, and opportunity.
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The energy imperative for the United States (US), amid the transition from the Joe Biden presidency to a second Trump administration, was expected to shift drastically—especially given the stark contrast between the two presidencies’ approaches to America’s energy security and the nation’s climate goals. Broadly, the Biden administration attempted to weave America’s energy planning with green/climate commitments, aligning critical infrastructure, federal procurement, and even workforce requirements with the green transition. For instance, the Biden administration cancelled the Keystone XL project in 2021, a major win for climate activists. It also signed a series of executive actions prioritising climate change mitigation, including restrictions on onshore drilling. On the other hand, the Trump administration took steps to reverse Biden-era climate policies on his first day in office, including pulling out of the Paris Agreement and actions that would expedite energy permissions.
With Trump’s returns, the world braced for renewed disruption—particularly visible in the evolving contours of US-India energy relations. Trump’s policies, often out of sync with America’s traditional partners are triggering a recalibration of Biden-era policies across the board. India is no exception.
For India, too, the US-India energy partnership is expected to see changes. A long-standing energy partner to Washington, India now finds itself navigating a turbulent reset. In Trump’s first 100 days, climate rollbacks, tariff hikes, and a renewed push for US energy dominance have unsettled the trajectory of cooperation. Augmented by the Biden-era US-India Strategic Clean Energy Partnership (SCEP), India and the US were on a path to advanced collaboration through an energy task force, national hydrogen strategies, bio-ethanol, Electric Vehicles (EVs) and new technologies. With Trump’s embrace of fossil fuel-centric energy policy, the old framework now faces a likely overhaul.
Trump’s second term signals a return to nationalist energy and trade policies of his first presidency. For India, this entails walking a fine line—balancing engagement on energy security, particularly liquefied natural gas (LNG) and technology cooperation, while managing emerging trade tensions and climate policy divergence. The first 100 days of Trump suggest that India’s focus is shifting away from symbolic alignment toward a more transactional, resilient approach.
With Trump’s returns, the world braced for renewed disruption—particularly visible in the evolving contours of US-India energy relations. Trump’s policies, often out of sync with America’s traditional partners are triggering a recalibration of Biden-era policies across the board. India is no exception.
President Trump’s early 2025 energy agenda mirrors the blueprint of his first term—but with greater global stakes. His administration has doubled down on fossil fuel production, reopened federal lands for drilling, and imposed fresh tariffs on solar equipment and aluminium. Climate progress made under earlier administrations is being rapidly reversed. The renewed emphasis on ‘energy dominance’ lacks a coherent international trade framework, and the administration’s isolationist posture threatens to unsettle long-standing global energy trade flows.
India, which imports a significant share of its LNG from the US, is grappling with pricing uncertainty and contractual unpredictability. New Delhi has been considering import duty reductions on US LNG to enhance affordability, procurement, and mitigate trade imbalances. For instance, while Indian Oil Corporation signed a five-year LNG deal with Trafigura linked to the US Henry Hub benchmark, GAIL India continues to hold long-term contracts for 5.8 million tonnes of LNG annually.
In February 2025, US crude oil exports to India hit a two-year high at approximately 357,000 barrels per day, as Indian refiners sought alternatives amid tighter US sanctions on Russian producers and tankers. However, declining shale production in the US—driven by falling oil prices, threatens supply reliability. On 2 May 2025, the West Texas Intermediate (WTI) benchmark stood at US$ 58.31 per barrel. India may need to explore new sourcing strategies to buffer against future disruptions. Ripple effects are also visible across Asia. Major LNG importers such as Japan and South Korea, who similarly depend on long-term US contracts, are adjusting procurement strategies. This presents India with an opportunity to deepen regional energy cooperation, especially through joint storage and transport infrastructure.
Trump’s tariff regime and unpredictable trade policies have added volatility to energy markets. New solar tariffs have complicated India’s green energy transition, especially given its reliance on imported solar equipment. Although Indian solar exports to the US have surged, they now face a 36 percent tariff—raising project costs domestically. Moreover, Washington’s retreat from global climate commitments has shaken trust in clean energy partnerships. Flagship initiatives such as the US-India Strategic Clean Energy Partnership (SCEP) now face credibility issues, with multilateralism giving way to unilateralism. The US withdrawal from multilateral clean energy forums has also reduced policy predictability for regional partners such as Vietnam and Indonesia. This could position India to step up and take on a more proactive leadership role in climate diplomacy across the Indo-Pacific.
Despite the headwinds, civil nuclear cooperation offers hope. Under the broader framework of the US-India Energy Security Partnership, both countries have committed to operationalising the long-stalled 123 Agreement. India is working to amend the Atomic Energy Act and Civil Liability for Nuclear Damage Act to resolve liability concerns—opening doors to large-scale US-designed reactors and advanced small modular reactors. The cooperation emphasises localisation, technology transfer, and joint industry participation. While seen as a breakthrough for clean power and strategic energy alignment, key hurdles such as legal and logistical barriers remain, casting a shadow over its implementation and long-term viability. The bilateral nuclear energy cooperation could see a new phase in light of the Trump administration’s renewed push on this front to quadruple the US’s nuclear-powered energy.
If implemented successfully, civil nuclear cooperation with India could become a model for emerging Southeast Asian economies exploring nuclear diversification. Singapore, while not pursuing civilian nuclear energy yet, is leveraging the 123 Agreement to deepen its nuclear knowledge base—a reminder that energy security cooperation, alongside defence, can anchor Indo-Pacific alignment.
For India, too, the US-India energy partnership is expected to see changes. A long-standing energy partner to Washington, India now finds itself navigating a turbulent reset. In Trump’s first 100 days, climate rollbacks, tariff hikes, and a renewed push for US energy dominance have unsettled the trajectory of cooperation.
India has responded to Trump’s energy unpredictability with quiet resilience. Without overtly challenging Washington, New Delhi is intensifying its energy diplomacy. It has diversified LNG sources—for example, through a 20-year LNG supply agreement between QatarEnergy and Petronet LNG (set to commence in 2028)—-ensuring long-term energy predictability for India. Additionally, India has fast-tracked its clean energy partnerships with the European Union (EU) and the United Arab Emirates (UAE). India’s response reflects and prioritises strategic autonomy over confrontation.
India continues to maintain high-level engagement with US agencies and companies despite the uncertainty to ensure minimal disruption to existing projects. However, under Trump 2.0, India’s energy playbook is clearly tilting toward redundancy and diversification. With the US increasingly mulling an energy policy which positions it as a net asymmetric exporter (as noted in the recent US-India Joint statement), India must hedge through resilient supply chains, alternative green tech partnerships, and stable LNG contracts with flexible clauses. Even as strategic ties with Washington deepen, India should prepare for a multi-aligned energy future where the US is only one node in a broader matrix. Bilateral collaboration opportunities remain significant—from technology transfer to co-investment in green hydrogen, carbon capture, and battery storage. However, these must be pursued with bilateral guarantees, especially with a focus on continuity amid evolving political dynamics in the US as contingencies. A promising example is Bloom Energy’s push to introduce solid oxide electrolysers in India, offering high-efficiency hydrogen production. As India awaits its first large-scale project, early, tech-driven collaborations can help shape a resilient hydrogen ecosystem, shielded from geopolitical volatility and rooted in bilateral innovation.
Trump’s tariff regime and unpredictable trade policies have added volatility to energy markets. New solar tariffs have complicated India’s green energy transition, especially given its reliance on imported solar equipment.
The first 100 days of Trump 2.0 underscore a hard truth for Indian policymakers: the US-India energy partnership, while valuable, must evolve. As Washington eyes India as an important strategic partner in the Indo-Pacific, energy cooperation could be a new important hinge. The US under Trump views India potentially as one of the largest energy export destinations in a new era of energy revivalism. For India, while diversification will be key, energy ties with the US could help in assuaging the impact of tariffs in other critical sectors.
Vivek Mishra is the Deputy Director of the Strategic Studies Programme, Observer Research Foundation.
Manish Vaid is a Junior Fellow at the Observer Research Foundation.
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Vivek Mishra is Deputy Director – Strategic Studies Programme at the Observer Research Foundation. His work focuses on US foreign policy, domestic politics in the US, ...
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Manish Vaid is a Junior Fellow at ORF. His research focuses on energy issues, geopolitics, crossborder energy and regional trade (including FTAs), climate change, migration, ...
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