Don’t Call it a Comeback: Why US-India Relations are Due for a Rebound
In this edition of the newsletter, senior advisor to SCSP, Sameer Lalwani makes the case for doubling down on the U.S.-India defense partnership and offers highlights from a track 1.5 India-X workshop SCSP hosted in New Delhi, in knowledge partnership with Carnegie India, on November 14, 2025.
A Bilateral Defense Breakthrough
On October 31, U.S. Secretary of War Pete Hegseth and Indian Defence Minister Rajnath Singh met in Kuala Lumpur to sign the “2025 Framework for the U.S.-India Major Defense Partnership,” a landmark agreement outlining defense cooperation for the next decade. This agreement builds on significant progress on defense operational and industrial cooperation over the past year, despite being overshadowed at times by some political friction. In spite of the tensions over tariffs, Russian oil, and the aftermath of the India-Pakistan war in 2025, the deal proves that over the past years, U.S.-India defense cooperation has matured into the steadiest part of the strategic partnership, partly due to China’s aggression on India’s borders, and in part owing to the mutual trust built over two decades of accelerating military-to-military capability transfer, interoperability, and trust.
A fact sheet laying out the ambitions of the agreement revealed several notable details and milestones.
Prioritization. First, the language of the agreement elevates defense as a top priority. In contrast to past 10-year agreements, defense has moved to center stage from “an important part” (1995) to “an element” (2005) to “a key component” (2015) to now “the major pillar” (2025) in the U.S.-India relationship.
Mission. Second, for the first time in three decades, a U.S.-India defense framework uses the word “deterrence” as a primary goal of the relationship. Deterrence requires a target (or adversary) whose behavior we intend to shape, implying a shared mission. Combined with the first mention of the geography of this partnership – “a pillar of peace and security and an anchor of stability in the Indo-Pacific region”– this makes it very clear who the shared adversary is without explicit naming. This language provides a level of specificity that warrants deeper operational, technological, supply-chain, and defense trade cooperation sought by both sides.
Density. Third, there is a depth and density to the document that is nearly twice as long (8 pages) as previous agreements in 2015 (5 pages), 2005 (4 pages), and 1995 (3 pages). The agreement also breaks new ground with new focus on space, cyber, and artificial intelligence (building off the Advanced Domains Defense Dialogue of 2023-24), as domains for interoperability as well as co-development.
Complementarity. Finally, the agreement’s commitment to “joint development and production of defense capabilities” banks on complementarities between U.S. defense tech and India’s trusted scale. It also doubles down on co-innovation efforts like the India-U.S. Defense Acceleration Ecosystem (INDUS-X) “to continue to facilitate private sector partnerships among U.S. and Indian companies, investors, and researchers, strengthening ties between American and Indian defense industrial ecosystems.”
Advancing INDUS-X: The Future of US–India Defense Tech Cooperation
The rollout of the framework was well-timed, as last week, the SCSP team was in New Delhi for discussions on AI and defense technology, including a workshop, in knowledge partnership with Carnegie India, on “Advancing INDUS-X: The Future of US–India Defense Tech Cooperation.” There we heard the core elements of the new defense framework echoed in the themes of the workshop including:
Deterrence Challenges. India’s war with Pakistan in May 2025 produced significant introspection over the exposed gaps in India’s defense capabilities, particularly in space-based ISR, air defenses, systems integration, electronic warfare, and drones. Industry analysts suggest Pakistan had a speed advantage when it came to space-based sensors seamlessly integrated with ground sensors and weapon systems, something that Chinese analysts also boasted about. India has been wrestling with the challenges of drone saturation and the expenditure of expensive interceptors against voluminous but cheap drone probes that put the defender on the wrong side of the cost curve.
The United States as the Preferred Partner. While Russia still remains a legacy partner for India in areas like nuclear propulsion and cruise missiles, on the modern battlefield dominated by the electrons and algorithms for advanced sensing, secure battle networks, and rapid decision support, India is looking to the United States to be its preferred partner. It is why U.S. companies like Shield AI, Anduril, and Ultra Maritime are working with Indian partners to co-produce autonomous drones and underwater vehicles, counter-UAS systems, and advanced sonobuoys for undersea surveillance. It is also why approximately half of India’s Air Force fighter squadrons and all frontline warships in 2040 will be powered by American engines.
Battlefield AI in Demand. India is approaching a shift from small numbers of expensive manned platforms to large numbers of inexpensive autonomous systems, requiring AI to enable one-to-many pilot-to-aircraft relationships. An estimated 89% of Indian defence tech startups have integrated AI into their products. The most critical near-term AI application for India is system-level integration for air defense including counter-drone, counter-air, and ballistic missile defense, a point also echoed by the Indian Chief of Defence Staff. Indian strategists and innovators appreciate that future conflicts will involve AI-enabled C2 to manage thousands of drones, ballistic missiles, loitering munitions, and cruise missiles simultaneously which will be impossible without AI. India’s software talent is uniquely positioned to develop indigenous battlefield management systems but the Indian military will need the U.S. to make this transition because it lacks the datasets for AI integration along with sufficient data security.
Space a Priority Domain. Indian strategists recognize that space has emerged as the domain that shaped all others (air, land, sea, cyber) in modern warfare. India’s relatively new Defense Space Agency has been empowered with an expanded budget and mandate to address strategic objectives. With India’s space economy growing 5 times faster than the global average over the past 8 years, the next 2-3 years are critical for India-U.S. cooperation. Priority areas include multi-sensor payloads (EO, SAR), combined GPS-NAVIC navigation systems, quantum technologies, AI-enable predictive analysis, and space situational awareness, essential given China’s plans for 100,000 satellites by 2030.
Reforms still needed. The creation of India’s Chief of Defence Staff’s authorities are—on paper—more far reaching than what was created by the U.S. Goldwater-Nichols Act, but further implementation is required. India needs integrated theater commands soon but Lt. Gen. (Ret.) Raj Shukla—former head of Army Training Command and current Union Public Service Commission member—has argued in his recent book that these need to be followed by “network centricity, digitization, jointness, integration, cross-pollination and finally civil- military fusion.”
Private Sector Rising. India’s defence sector is transitioning from public-sector dominance to a mixed ecosystem of public, private, and startup players yet coordination among companies, primes and governments remains a challenge. India’s defense tech ecosystem, and efforts like INDUS-X will grow if sustained orders are placed at speed to help companies navigate the valley of death. U.S. support can help bolster India’s burgeoning defense private sector. U.S.-India cooperation can leverage co-production as a steppingstone for co-development in component and subsystem manufacturing. This in turn can draw upon commercial innovations between U.S. primes and Indian startups, facilitated by venture capital and accelerators.
Encouraging a Culture of Innovation. India’s defense ecosystem is still learning to normalize a “fail-fast” culture of rapid prototyping. This could include “full cost, no commitment” trials, open system architectures, expedited capability testing in joint exercises, and standardized interoperability frameworks to accelerate adoption. Recent emergency procurements and the new Defence Procurement Manual have embraced some of these concepts, and industry is hopeful the forthcoming revised 2025 Defense Acquisition Procedures will further streamline procedural hurdles.
“Trust,” From Declarations to Deeds. With the recent U.S.-India tensions over trade and Russian oil, Indian partners reiterated throughout our discussions last week that some trust has been lost in the relationship. While awaiting the right timing for a political reconciliation, routinized collaborations can help rebuild this trust. For America, that means conducting regular military operational missions together (like in the maritime and undersea domains) to share the burdens of securing a free and open Indo-Pacific. For India that means lowering the regulatory barrier to produce things together from sonobuoys to satellite payloads, which develops India’s defense technology ecosystem. Both lines of effort can build trust and contribute to deterrence.
Actions, Not Just Words
It is on this last theme from our workshop where we are seeing some very encouraging signs in bilateral relations. The strength of the U.S.-India relationship can be effectively measured in terms of growing military and defense industrial interoperability.
Military Exercises. Despite some political headwinds, U.S.-Indian military exercises have been a steadying force in U.S.-India defense cooperation throughout 2025. Just before the Hegseth-Singh meeting, the U.S. Navy announced the completion of a week-long U.S.-India P-8 bilateral combined detachment near the strategically critical Diego Garcia base. Two more major exercises—de facto Quad exercises featuring Australia, India, Japan, and the U.S.—were held just this month. Last week, the naval exercise Malabar was conducted off the coast of Guam featuring joint fleet operations, anti-submarine warfare, and gunnery serials, while the U.S. and Indian Air Forces conducted a bilateral Cope India exercise with a U.S. B-1 bomber.
Beyond anecdotes, the data suggests the U.S.-India exercise regimen in 2025 nearly matches pace with 2024 – a highwater mark in the relationship. The U.S. and India are likely to complete at least 17 exercises together this year, whether in bilateral or multilateral settings.
The growing quantity of exercises has been matched by qualitative leaps, measured in complexity. In September 2025, the 21st annual edition of the U.S.-India “Yudh Abhyas” Army exercise featured a brigade level exercise conjoining elements of the U.S. and Indian militaries, and fielding of new capabilities. Originally a counter-terrorism measure, this exercise has become a benchmark for allied interoperability. As it stands, Yudh Abhyas has evolved from small-scale firing and counterterror exercises into one of the largest exercises the Indian Army holds with a focus on cyber, drone, and extreme terrain warfare.
To assess this trend, I asked ChatGPT to assign a complexity score from 1-5 to each of the “Yudh Abhyas” exercises dating back to 2002 accounting for unit type and levels, troop numbers, mission types, duration, system elements, and terrain. A plot of the data shows a steady rise in complexity of the exercise over two decades.
Staff Engagements. The exercises have been complemented by a recent set of senior-level defense meetings. Following the defense ministerial meeting, The U.S.-India Military Cooperation Group—led by U.S. Indo-Pacific Command Deputy Commander LTG Joshua M. Rudd and India Chief of Integrated Defence Staff Air Marshal Ashutosh Dixit—conducted their annual meeting at USINDOPACOM in early November to unpack and plan the first year of the ten-year agreement. The Indian Naval Chief just visited the United States for several days of meetings with INDOPACOM and US Pacific Fleet on maritime security cooperation.
Defense Industrial Collaboration. Finally, there are promising industry signs on the horizon that all involve opportunities for co-production and indigenous technology integration. India just signed a contract for the purchase of over $1 billion of GE F404 engines to power its indigenous fighter jets, and analysts expect it to sign another contract with GE for co-production of the F414 engines. The Pentagon just approved India’s purchase of a first batch of javelin missiles and launchers, which is expected to scale and eventually pave the way for eventual co-production in India. For the Indian Army, which rarely operates on American equipment, purchasing the “Russian tank killer” is the kind of symbolism that’s hard to ignore. The Indian Navy is poised to purchase another six P8-I maritime patrol aircraft involving significant local production and indigenous content including radars and missiles by early 2026. The P-8 is coveted by the Indian Navy, not only because it enables tracking of Chinese nuclear submarines, but also because of what former Indian Navy Chief ADM Sunil Lanba has noted as its far greater serviceability compared to Russian platforms.
Industrial collaboration, however, is a two-way street that extends to India’s defense startups and small to medium enterprises. Since 2018, the number of new collaborations between the U.S. and India has skyrocketed.
The implications of the new 10-year Defense Framework–accompanied by expanding military exercises, senior official engagements, and defense technology deals–are clear: U.S.-India strategic partnership is here to stay, grow, and have an outsized impact on the global tech competition and Indo-Pacific balance of power.