Steep US tariffs prompt India to speed up global tech ties

The imposition of a 50% tariff on Indian exports to the United States by President Donald Trump has jolted India into action, triggering an urgent reassessment of its technology collaborations and trade alliances. In a bid to mitigate the economic fallout and reduce dependence on the American market, India is actively seeking to expand its network of trade and technology partners.

With growing concerns about the U.S. becoming increasingly protectionist and unpredictable, industry experts believe India will intensify efforts to build stronger, more reliable economic ties with other key global players. High on this list are the United Kingdom, the United Arab Emirates, Japan, and several Southeast Asian nations, all offering a combination of market access, strategic capital, and technological compatibility.

The U.K. remains a natural fit, given its historic trade and educational linkages with India, along with growing synergies in fintech, artificial intelligence (AI), and digital policy innovation. Japan brings unmatched strengths in critical sectors like semiconductors, robotics, and precision hardware, fields essential to India’s ambitions in advanced manufacturing and deep technology.

The UAE, rapidly emerging as a hub for the digital economy, offers both financial backing and geopolitical flexibility, making it an increasingly attractive destination for Indian startups working in areas like AI, blockchain, and Web3 technologies.

“In light of rising trade tensions, India is likely to accelerate its strategy of building a diversified portfolio of tech partnerships. The UAE and Saudi Arabia, with their enormous sovereign wealth funds and deep interest in AI, blockchain, and quantum technologies, are soon becoming natural partners. These nations not only offer capital but share India’s appetite for leapfrogging legacy systems,” Raj Kapoor, founder of India Blockchain Alliance (IBA), told CoinGeek.

“Simultaneously, Japan and South Korea, already key players in semiconductor supply chains, offer both technological know-how and geopolitical alignment, making them ideal partners in the post-China recalibration of global tech ecosystems,” Kapoor pointed out.

India is also hedging risks by deepening ties with alternative blocs. An Indian delegation is reportedly set to engage in talks with Latin America’s major economic and political bloc, MERCOSUR. The objective is to explore the possibility of upgrading the existing Preferential Trade Agreement (PTA) into a comprehensive Free Trade Agreement (FTA). MERCOSUR, which includes Brazil, Argentina, Paraguay, and Uruguay, has a PTA with India since 2004.

With MERCOSUR accounting for over 67% of South America’s total economic output, this move could open access to a $2.94 trillion market within a region whose total GDP (gross domestic product) stands at $4.38 trillion. The talks signal India’s urgent intent to diversify its trade partnerships amid rising global economic volatility and shifting geopolitical alignments.

In parallel, India is also reportedly advancing negotiations with the European Union, Peru, and Chile. Peru has already held negotiations and is expected to finalize a trade agreement with India by 2025. Meanwhile, India and Chile held their first round of discussions in May 2025 for a Comprehensive Economic Partnership Agreement (CEPA) aimed at achieving deeper economic integration.

India to partner nations offering innovation, stability

In the coming months, India is expected to fast-track strategic partnerships with nations that support its innovation-driven agenda and provide a combination of political stability, investment potential, and technological capabilities. With growing global uncertainty, there is an urgent need for India to deepen ties with countries that can help reinforce its long-term economic and technology ambitions.

“India has always followed a multi-aligned strategy in its tech diplomacy. If the U.S. becomes less predictable or more protectionist, India is likely to deepen its partnerships with countries such as the U.K., UAE, Japan, and those in Southeast Asia,” said Denys Peleshok, chief international growth officer at MD Finance, a technology company providing financial services.

“India has long-standing ties with the U.K. in trade, education, and technology, making it a natural partner for collaboration in fintech, AI, and regulatory innovation. Japan brings deep expertise in hardware, robotics, and semiconductors—areas critical to India’s manufacturing and deeptech ambitions. The UAE is positioning itself as a digital economy hub, offering capital and more flexible geopolitical conditions, which could unlock new opportunities for Indian Web3 and AI ventures,” Peleshok told CoinGeek.

Europe is rapidly emerging as a key strategic partner for India, especially in high-impact areas like privacy-conscious AI, sustainable technology, and ethical digital infrastructure. With the global tech landscape shifting under the pressure of geopolitical tensions and regulatory crackdowns, this moment presents a critical window for India to strengthen ties with the EU. What makes this alignment particularly promising is India’s growing resonance with the EU’s approach to digital sovereignty and responsible tech governance. Both sides emphasize the importance of safeguarding user data, building transparent AI systems, and developing digital ecosystems prioritizing ethical standards over unchecked growth.

This regulatory convergence could pave the way for meaningful, long-term collaboration in AI research, digital policy frameworks, and developing secure, future-ready technologies. Given the increasing urgency for democratic nations to set global standards in emerging technology, India’s closer engagement with Europe could play a pivotal role in shaping the next chapter of digital governance.

“The EU, too, is pushing for ethical AI and digital sovereignty. India can align with the EU’s Digital Decade agenda, particularly in open-source AI, green tech, and trusted data flows. With shared concerns on China and a history of tech collaboration, both offer hardware capabilities (chips, electronics) and are trusted allies,” Kapoor of IBA told CoinGeek.

India ‘finally free’ to shift from dependency to ‘equal co-architect’

India has already established a diverse network of partnerships beyond the U.S., signaling its intent to broaden strategic engagement and reduce overreliance on any single global player. Key collaborations include the India-U.K. Enhanced Trade Partnership, the India-EU Connectivity Partnership, and the India-Israel Industrial R&D and Technological Innovation Fund. India is also an active participant in multilateral forums such as BRICS, alongside Brazil, Russia, China, and South Africa, and the Quadrilateral Security Dialogue (QUAD) with Japan and Australia, pointed out Ritesh Verma, a mentor at Indian Institutes of Technology (IITs).

Leveraging these forms and partnerships, India is bound to gain even without the support of the U.S., Verma told CoinGeek.

As global dynamics shift, India is likely to urgently build on these existing relationships to safeguard its innovation and economic goals. These partnerships offer distinct and high-impact advantages, Verma informed. For instance, the U.K. brings deep expertise in fintech and data governance, making it a valuable ally as India shapes its digital economy. Israel’s leadership in defense technology and agri-tech provides India with critical support in sectors tied to national security and food sustainability.

While each partnership brings its strengths, collectively they position India to thrive, even without full alignment or support from the U.S. By intensifying cooperation across these platforms, India can tap into global expertise, attract investment, and fast-track innovation in key industries.

“Africa, while often overlooked, is a growing destination for Indian startups in fintech, healthtech, and edtech, offering real-world testing grounds for scalable innovation…Africa’s young digital economy presents sandbox environments where Indian Web3, fintech, and healthtech startups can scale solutions and test models,” Kapoor of IBA pointed out.

Amid these rapidly evolving global dynamics, India stands at a pivotal crossroads. No longer limited to being merely a consumer of international technology, it now has a real opportunity to shape and co-develop global tech norms and standards. The urgency lies in whether India can capitalize on this moment of geopolitical flux to establish itself as a sovereign innovation leader, one that builds diverse, strategic alliances across regions.

The pressing question is whether India will step forward and assert its role as a multi-aligned innovation powerhouse, driving not just adoption, but the future direction of global technology and governance.

“India’s positioning as a non-aligned but tech-forward democracy allows it to build multi-vector partnerships, something the U.S. may underestimate. In a multipolar tech world, I feel that India is finally free to pivot from being a dependent partner to becoming an equal co-architect,” Kapoor added.

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