The sweeping Democratic victories in the 2026 US midterm elections, which are set to hand the party control of both the Senate and the House of Representatives, have dealt a major blow to President Donald Trump. While the results could constrain his domestic legislative agenda, they may intensify pressure on India to conclude a bilateral trade deal quickly, according to a report by the think tank Global Trade Research Initiative (GTRI).
The election results mark a significant shift in Washington’s political balance, with Democrats preparing to challenge the administration’s policies after two years of Republican control. However, the change in congressional power is unlikely to alter the broader US protectionist trade stance, the report said.
Democrats Make Historic Gains in Republican Strongholds
The Democratic wave swept across traditionally Republican-leaning states, overturning expectations that the party would struggle to make significant gains in the Senate. Democrats have clinched the Senate majority, while competitive House races across the country pointed to a decisive shift in control of the lower chamber.
The victories were particularly striking in states that had strongly supported Trump in the 2024 presidential election. Kansas elected its first Democratic senator since the Great Depression, nearly a century ago. In South Carolina, Democrats defeated Trump's hand-picked Senate candidate, Darline Graham. Darline is the sister of late senator Lindsay Graham who had proposed the bill to impose hefty tariffs on countries buying Russian oil. Though President Trump has signed it after it was passed in both the houses, it has not been implemented yet.
Texas witnessed one of the biggest political reversals. Democrats ended a decades-long losing streak by winning a Senate seat and defeating three-term Republican Governor Greg Abbott. The state had been a Republican stronghold, with Trump winning it by a substantial margin in 2024.
In Maine, Republican Senator Susan Collins lost her seat, ending a three-decade career despite her efforts to distance herself from Trump. The results also exposed the vulnerability of candidates personally endorsed by the president.
Democrats made significant gains in competitive House contests, winning all 20 races that had been decided at the time of reporting. An unprecedented Republican effort to redraw congressional districts to improve electoral prospects largely failed, with Democrats retaining most of the targeted seats.
The results were driven by voter concerns over the cost of living, the unpopular war with Iran and Trump's economic policies, particularly tariffs. Democrats accused the administration of worsening inflation and prioritising wealthy interests over ordinary Americans.
Exit polls indicated that half of voters viewed the midterm elections as an opportunity to rebuke Trump, while 70% wanted Congress to exercise stronger checks and balances on the president.
The incoming Democratic-controlled Congress is expected to investigate the administration and demand concessions on major legislation. The Senate could also block presidential nominees, including potential Supreme Court appointments.
Trade Deal: Political Setback May Accelerate Negotiations
Despite the electoral setback, the broader direction of US trade policy is unlikely to change significantly. GTRI said both Democrats and Republicans increasingly support economic nationalism, domestic manufacturing and protective trade measures.
The report argues that Trump may now seek a quick trade deal with India to demonstrate his negotiating strength and secure a foreign policy and economic achievement amid domestic political difficulties.
The proposed US-India trade framework remains contentious. Under the February 6 joint statement, India is expected to reduce or eliminate tariffs on a wide range of American industrial and agricultural products. Washington, however, would retain its regular Most Favoured Nation (MFN) import duties.
India has also been asked to commit to purchasing $500 billion worth of American goods over five years and align certain economic and security policies with Washington. The US had earlier indicated that it would reduce additional reciprocal tariffs on Indian goods from 25% to 18%.
However, the Supreme Court's February 20 ruling in Learning Resources, Inc. v. Trump struck down the administration's reciprocal tariffs imposed under the International Emergency Economic Powers Act (IEEPA), removing a key bargaining instrument.
GTRI said the loss of this leverage could encourage Trump to rely more heavily on other executive powers, including Section 232 and Section 301, to maintain pressure on trading partners.
The report warned that India could continue facing additional US tariffs of 15% to 18%, even after signing the proposed agreement. It also cautioned that the arrangement could expose India to substantial policy and legal risks.
International trade policy expert Abhijit Das has warned that granting preferential tariff treatment to US goods without extending similar concessions to other World Trade Organization (WTO) members could violate India's MFN commitments.
The proposed arrangement may also fail to qualify as a valid free trade agreement under WTO rules if Washington does not provide reciprocal tariff concessions.
GTRI urged India to avoid treating relief from threatened tariffs as a substitute for a balanced agreement. It said New Delhi should insist on enforceable reciprocal concessions, WTO compliance and sufficient flexibility to protect its energy security and development priorities.
The report concluded that the pressure to announce a deal should not outweigh the need to secure one that serves India's long-term economic interests.