Moneycontrol Pro Panorama | Trump 2.0, H-1B and the art of selective softness

India sits squarely on the right side of that segmentation.

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Donald Trump is not unpredictable. He is performative, transactional and ruthlessly iterative. Anyone waiting for ideological consistency should have stopped tracking his presidency years ago. The pattern is the point. Punch, extract concessions, soften, claim victory. Rinse. Repeat.

Against that backdrop, this week’s shift on H-1B is not a policy pivot. It is a pressure valve adjusting to commercial gravity and geopolitical arithmetic.

“We don’t have plenty of talent. We have to bring in people,” Trump told Fox News, batting aside the idea that America has enough skilled workers to build missiles, code the next frontier of AI or staff Silicon Valley’s perennial hiring hunger.

For a politician who weaponised immigration rhetoric, this is a tonal U-turn sharp enough to register on the Richter scale of domestic politics.

But don’t mistake this as surrender. It is segmentation. Illegal immigration --bad. Skilled immigration -- negotiable. High-skill visas – useful. That’s Trump’s line.

Where does India stand?

India sits squarely on the right side of that segmentation. The country that supplies more than 70 percent of approved H-1B petitions was never the real target of the Make America, Hire America rhetoric.

It was collateral noise to a base that sees immigration as a single block, not a stack of spreadsheets.

Corporate America, particularly tech, has always lived in the margins Trump eventually respects -- economic utility. Nationalism fights the crowd. Capital fights for relevance. Guess who wins when the earnings calls begin.

But to read this softening as romance with India would be expensive naivety. Trump has been squeezing New Delhi on three fronts – tariffs, trade and oil. The message has been consistent. Align commercial incentives with American interests, or pay in market access.

When India continued to hoover discounted Russian crude after the invasion of Ukraine, Washington frowned. When India ran a $36 billion trade surplus with the US, Washington frowned harder.

Eventually, when duties on American goods stayed sticky, the response was 50 percent tariffs on select Indian exports. It was never personal. It was pricing power.

And then, the concessions came

Indian refiners slowed Russian crude intake significantly after US sanctions hit key suppliers. Commerce negotiators began showing flexibility on tariff architecture. New Delhi signalled room for balance on import mix. And the minute the bargaining chips began sliding across the table, the rhetoric thawed.

“They’ve stopped doing the Russian oil,” Trump said this week, claiming progress. “We’re pretty close to doing a deal.” This is how carrots sound after the stick has done its job.

To cut a long story short,  the timing of the H-1B softening is not accidental. It is auctioneering. India wants tariff predictability and smoother talent mobility.

The US wants trade realignment, reduced Russian energy flows, and greater market access in India. Both sides are now negotiating with deliverables on the table.

On this side, the markets have responded before diplomats finished the sentence. The rupee firmed a bit, post this announcement. But, on Wednesday, the rupee fell 15 paise to 88.65 against the dollar in early trade, weighed down by elevated crude oil prices and foreign fund outflows.

Currencies price narratives faster than treaties do. The narrative flip is already in motion: from friction to negotiation; from tariff threats to tariff “reduction at some point”; from suspicion to transactional warmth.

The instructive part is not that Trump softened. It is that he softened after India shifted behaviour in areas that mattered to Washington.

That is the core lesson of Trumpology.

So, what next?

For India, the strategy now has to be equal parts pragmatism and non-sentimentality. Secure tariff headroom where possible. Preserve strategic autonomy where necessary.

Extract clarity on high-skill visas without confusing goodwill with permanence. Trump friendships, like Trump press conferences, last as long as the news cycle needs them to.

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Dinesh Unnikrishnan
Moneycontrol Pro