At the World Economic Forum (WEF) in Davos on January 21, 2026, US President Donald Trump praised Prime Minister Narendra Modi, calling him a “fantastic leader” and a great friend, and expressed optimism that India and the US will reach a favourable trade deal. Speaking to the media on the sidelines of the summit, Trump said, “I have a great respect for your prime minister. He is a fantastic man and a friend of mine. We are gonna have a good deal.”

Trump’s remarks come amid uncertain trade relations between India and the US, following a significant tariff increase on Indian exports. Nearly five months ago, tariffs were raised to 50 per cent, with half of the hike described by Trump as a “penalty” linked to India’s purchase of Russian oil. Although official trade discussions have been ongoing, clarity on the timeline for a final deal remains limited, contributing to market and diplomatic uncertainty.

In recent weeks, statements from senior members of the Trump administration added to the ambiguity. US Commerce Secretary Howard Lutnick claimed a potential trade deal collapsed because PM Modi did not personally contact Trump, while another aide suggested that Trump had approved a proposal that could raise tariffs on India to as much as 500 per cent. India firmly rejected Lutnick’s remarks, calling them incorrect, and diplomatic optimism was partially restored when the new US ambassador to India, Sergio Gor, confirmed that trade talks are still in progress and reaffirmed India’s importance as a partner.

Despite the tariff warnings, Trump continued to speak highly of PM Modi, highlighting both his personal respect and his confidence in the potential for a mutually beneficial trade deal. Earlier in January, Trump had also hinted that tariffs could be increased further but maintained praise for Modi, stating, “India wanted to make me happy. Modi is a very good guy… We can raise tariffs on them very quickly.”

At Davos, Trump also discussed the US economy, calling the country the “economic engine of the planet”. He described the current economic situation as a boom, with rapid growth, rising incomes, and declining inflation, framing it as one of the fastest economic turnarounds in US history. Trump emphasized that America’s economic performance benefits the global economy, positioning the US as a key driver of international growth and opportunity.

The Trump-Modi interaction at Davos signals both personal goodwill and ongoing negotiation on trade matters, balancing optimism with the potential for future tariff action. While tensions remain over trade policies, Trump’s public praise of PM Modi underscores a strategic effort to maintain strong India-US relations, even amid ongoing economic disagreements.

In conclusion, at Davos 2026, Donald Trump lauded PM Modi as a “fantastic leader,” expressed confidence in a positive India-US trade agreement, and highlighted the strength of the US economy. The remarks come during a period of tariff-related uncertainty, but ongoing discussions and diplomatic engagement suggest both countries are working toward a favourable resolution in trade relations.

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