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flag India and the U.S. navigated trade tensions in 2025 but stabilized relations, with growing trade and U.S. investments in India’s AI sector.

flag India-U.S. relations in 2025 faced strain due to trade tensions, including proposed tariffs and disputes over India’s Russian oil purchases, though ties stabilized by year’s end. flag Despite stalled trade talks, especially over U.S. demands for agricultural market access, trade volumes grew, and U.S. investments in India’s AI sector signaled long-term confidence. flag Key reforms in India, including foreign investment liberalization and tax changes, supported economic openness. flag Early 2026 is seen as critical for finalizing a trade deal, hosting high-level summits, and advancing strategic cooperation.

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