Peter Navarro, former trade adviser to Donald Trump and a leading proponent of the “America First” doctrine, has once again reignited debate over US–India trade relations, this time focusing on the rapidly expanding AI and digital services economy. His latest remarks question the fairness of current digital trade arrangements, particularly why advanced Artificial Intelligence services developed and hosted in the United States are heavily used by Indian consumers and businesses.
Navarro argues that American companies shoulder the massive infrastructure, research, and operational costs required to build and maintain cutting-edge AI platforms. However, he claims that a disproportionate share of the usage—and therefore economic value—flows overseas, especially to India. From his perspective, this dynamic creates an imbalance where US innovation and capital effectively subsidize foreign digital consumption, raising concerns about long-term economic fairness and domestic competitiveness.
AI Services and Digital Trade Imbalance
At the core of Navarro’s critique is what he sees as an asymmetry in the global digital economy. While US firms invest billions in cloud computing, AI model development, and data infrastructure, international users benefit without equivalent reciprocal advantages for American workers or taxpayers. Navarro suggests this could weaken the US technological edge if left unaddressed, particularly as AI becomes central to economic growth and national security.
A History of US–India Trade Disputes
Navarro’s comments are not isolated. They echo a broader pattern of trade tensions between Washington and New Delhi, including past US tariffs on Indian goods and disputes over market access. He has also been a vocal critic of India’s continued purchases of Russian oil, arguing that such policies undermine Western efforts to maintain unified sanctions and geopolitical pressure.
Additionally, Navarro has repeatedly described India’s trade and regulatory environment as protectionist, claiming it places American companies at a disadvantage when entering the Indian market.
“America First” and Economic Nationalism
These views align closely with the economic nationalism that defined the Trump administration’s trade agenda. Navarro sees global trade as a competitive arena rather than a cooperative system, where any perceived imbalance directly threatens American prosperity. His renewed focus on AI services reinforces calls for stronger trade enforcement, digital regulation, and domestic industrial protection.
India’s Perspective on AI and Global Trade
From India’s standpoint, the criticism overlooks its role as a major global technology hub with one of the world’s largest digital user bases. India views access to AI services as essential for innovation, productivity, and economic growth. Indian policymakers often interpret US tariffs and trade pressures as barriers that restrict emerging economies from fully participating in global markets.
India also maintains that its foreign policy decisions—particularly in energy procurement—are driven by national security and economic stability, not ideological alignment.
What This Means for Global Tech and Geopolitics
Navarro’s remarks could intensify existing trade frictions, potentially leading to new protectionist policies, digital trade regulations, or retaliatory measures. In the AI sector, this debate may accelerate discussions around data sovereignty, cross-border data flows, and equitable value distribution.
Geopolitically, prolonged trade disputes risk straining the strategic US–India partnership, a relationship seen as crucial for balancing China’s growing global influence. Economic cooperation remains a cornerstone of broader diplomatic alignment.
Final Takeaway
Peter Navarro’s renewed criticism of AI services used by Indian users highlights the complex challenges of digital trade in an interconnected world. As AI reshapes global economies, questions around fairness, reciprocity, and regulation are becoming unavoidable. Whether these tensions lead to confrontation or cooperation will depend on diplomatic engagement and adaptive trade frameworks that recognize both national interests and global realities.
