US-India COMPACT (Catalyzing Opportunities for Military Partnership, Accelerated Commerce & Technology) for the 21st Century was launched by President Donald Trump and Prime Minister Narendra Modi.
Highlights of the India – US COMPACT Initiative
- Defence Collaboration: A new 10-year Framework for the US – India Major Defence Partnership (2025-2035) will be signed, expanding Defence sales and co-production of Javelin Anti-Tank Guided Missiles, and enhancing joint exercises like Tiger Triumph. The initiative includes the Reciprocal Defence Procurement (RDP) Agreement for seamless Defence trade and Autonomous Systems Industry Alliance (ASIA) to boost AI-driven autonomous Defence cooperation.
- Trade and Investment Expansion: Under the COMPACT Initiative, the ‘Mission 500’ initiative was launched to increase bilateral trade to USD 500 billion by 2030, supported by negotiations for a Bilateral Trade Agreement (BTA). Efforts include reducing trade barriers, such as tariff cuts on beverages, vehicles, and Information and communication technology (ICT) products, while increasing market access for agricultural goods and industrial exports.
- Energy Security: Strengthens energy ties, boosting oil, gas, and nuclear cooperation, with the US supporting India’s International Energy Agency (IEA) membership.
- Technology Advancement: The Initiative on Critical and Emerging Technologies (iCET) was rebranded as TRUST (Transforming the Relationship Utilizing Strategic Technology), focusing on semiconductors, quantum computing, and Artificial Intelligence (AI). Efforts will expand critical mineral supply chains, including lithium and rare earth recovery projects. Civil space cooperation will advance through NASA-ISRO initiatives, including an Indian astronaut’s mission to the International Space Station (ISS) and the NISAR launch.
- Multilateral and Regional Cooperation: Strengthen Quad partnerships, enhance counterterrorism efforts, Indo-Pacific security and advance connectivity projects like the India-Middle East-Europe Corridor. People-to-People Engagement: The COMPACT initiative boosts academic and workforce mobility, eases legal migration, and strengthens law enforcement cooperation against trafficking and transnational crime.
India – US Relations
- Trade and Investment: India-US ties have evolved into a “global strategic partnership”. In 2024, India’s total goods trade with the U.S. reached USD 129.2 billion. India’s exports to the U.S. stood at USD 87.4 billion, while imports from the US were USD 41.8 billion. India has a USD 45.7 billion trade surplus with the US in 2024. USA is the 3rd largest investor in India with cumulative Foreign Direct Investment (FDI) inflows of USD 65.19 billion from 2000- 2024.
- International Cooperations: India and the US collaborate in multilateral forums like the United Nations, G-20, Association of Southeast Asian Nations, World Trade Organization, I2U2 group and Indo-Pacific Economic Framework for Prosperity (IPEF).
- Defence Cooperation: India-US defense ties strengthened with the 2005 Defense Framework, renewed in 2015. India is a Major Defense Partner of the US with Strategic Trade Authorization-1 (STA‑1) status (allowing easier access to US defense technologies).
- Joint exercises: Ex VAJRA PRAHAR (Army), SALVEX (Indian Navy), Cope India (Air Force) and Malabar Exercise (Quadrilateral naval exercise of India, USA, Japan and Australia).
- People to people Ties: The 3.5 million Indian American community plays a key role in US society, strengthening India-US ties.