President Donald Trump appears to have relented, at least for now, on his demand to acquire Greenland either through purchase or coercion, or even by invading the island notwithstanding it being a NATO member country’s territory. Earlier, in his response to a BBC question if he is willing to sacrifice the NATO alliance by invading, he said "Nobody has done more for NATO than I have, in every way,…NATO is going to be happy and we are going to be happy," Furthermore, “We need it for world security.”

It is not surprising that preposterous statements regarding Greenland by President Trump have angered the Danish government, European leaders and other NATO member states alike. They had no hesitation in labelling these as outlandish and announced red lines over sovereignty of the NATO member states. Danish Prime Minister Mette Frederiksen had been visibly rattled and labelled the situation “a serious matter” and stated that his country would take every step possible to prevent such a scenario.

According to recent media reports, amid speculations and rumors, the US and Denmark may have reached an agreement that the latter would provide the US a small patch of land on Greenland soil to set up a new military facility. This is both a great internal victory for the NATO members on issues of unity as also a push back against an aggressive Trump who has been a thorn for the alliance members over threats over multiple issues such as withdrawal from NATO, increased defence spending (5 % of the GDP), conditional support for NATO, involvement in Ukraine, hot and cold attitude wrt President Putin, FTAs, etc.

At the heart of the US’ desire and need to takeover Greenland stems from the dual requirements of strategic dominance in the higher latitudes in the north particularly the Arctic vis a vis Russia, and easy availability of critical minerals which are valued at trillions of dollars. Greenland offers the US and the NATO a high perch to monitor Russian military activity in the western Arctic-North Atlantic-Greenland-Iceland-UK) GUIC Gap and growing Chinese influence-presence including shipping in the Arctic region that could in the future increase resulting in sustained PLA Navy’s presence.

The Greenland issue should also be seen from the prism of US National Defence Strategy 2026 which highlights the need to secure not only Homeland but also the western Hemisphere directing the Department of Warfare to build “credible options to guarantee U.S. military and commercial access to key terrain from the Arctic to South America, especially Greenland, the Gulf of America, and the Panama Canal. We will ensure that the Monroe Doctrine is upheld in our time”.

In the above context, Greenland’s significance gains ascendency from the perspective that it acts as a shield-advance warning against incoming missile attacks from Russia against the US. In May 2025, the Trump Administration had proposed multilayered missile defence programme called the “Golden Dome” to counter aerial threats and deploy missile interceptors in space to shield against ballistic and hypersonic threats. The project is estimated to cost $175 billion and is set to be completed by the end of Trump’s term in 2029.

The Dome is inspired by the Israeli successes with its Iron Dome that was able to thwart missile-rocket-drone attacks from Iran, Yemen, Syria, and Lebanon. Its architecture comprises of “four integrated layers: a space-based sensing and targeting layer for missile warning and tracking as well as "missile defense" and three land-based layers consisting of missile interceptors, radar arrays, and potentially lasers”.

Second is about resources. The US Geological Survey estimates mineable rare earth reserves in Greenland could be about 1.5 million tonnes; on the other hand the Geological Survey of Denmark and Greenland (GEUS) has pegged resources around 36.1 million tonnes . Also, Greenland’s offshore basins are rich in oil and gas: i.e. 17.5 billion barrels of oil and 148 trillion cubic feet of natural gas. Further, there are different estimates for the monetary value of these resources. The American Action Forum (AAF) have been assessed to exceed US$ 4 trillion; The Financial Times has valued these at $1.1 trillion and the New York Times’ estimate are between $12.5 to $77 billion.

Pursuant to the recent “deal” between Denmark and the Trump administration, the latter announced investments by the US Company USA Rare Earth that will invest $1.6bn aimed at challenging China's dominance in the sector as also build own technological capacities for mining. The Export-Import Bank of the United States will provide $120m to finance Greenland mining projects and Australia and Japan too have expressed interest in joining.

While there have been apprehensions among the NATO allies over the Greenland issue, it appears there is now a better understanding among them about Trump’s logic of “national security imperatives," and “economic” gains which could also be useful for Denmark given that other the Chinese “outside investments into its extractive industries” have been absent for multiple reasons such as environment degradation, technology, human resources, to name a few.

Dr. Vijay Sakhuja is former Director National Maritime Foundation, New Delhi and is associated with Kalinga International Foundation, New Delhi.