India-China Rapprochement Accelerates, Challenging US Influence and Reshaping Asian Trade

A rapid acceleration in India-China relations is underway, signaling a significant geopolitical realignment that analysts suggest could reshape Asian trade dynamics and diminish US influence in the region. Driven by recent US tariff policies and shifting global priorities, New Delhi and Beijing are moving past years of animosity, marked by high-level diplomatic engagements and confidence-building measures.

Just this week, Indian Prime Minister Narendra Modi engaged in discussions with China’s top diplomat, Foreign Minister Wang Yi, emphasizing “respect for each other’s interests” and “steady progress” in bilateral ties. Wang Yi’s two-day visit to New Delhi also included meetings with Indian Foreign Minister S Jaishankar and National Security Adviser Ajit Doval, focusing on their disputed Himalayan border.

Both nations have announced crucial steps to mend relations, including the resumption of direct flights, streamlined visa processes, and facilitated border trade. Beijing also recently permitted Indian pilgrims to visit holy sites in Tibet. Critically, Prime Minister Modi has accepted an invitation from Chinese President Xi Jinping to attend the Shanghai Cooperation Organisation (SCO) summit in Tianjin later this month, marking his first visit to China in over seven years. China’s Foreign Ministry affirmed the countries are on a “steady development track,” advocating for mutual “trust and support.”

This dramatic thaw, dubbed the “Dragon-Elephant tango” by President Xi earlier this year, comes despite deep-seated historical tensions, including a border conflict in 1962 and more recent clashes in 2020. Experts attribute this shift largely to former US President Donald Trump’s protectionist trade policies, particularly the imposition of significant tariffs on Indian imports, and a perceived pivot towards Pakistan. Peter Navarro, White House Counsellor for Trade and Manufacturing, recently reinforced this stance in the Financial Times on August 18, criticizing India’s “strategic autonomy” and demanding it “start acting like” a US strategic partner.

Analysts suggest that for India, this rapprochement offers a crucial avenue to mitigate the impact of US tariffs and reduce reliance on the US market by gaining greater access to Chinese markets and fostering collaborative supply chains. For China, drawing India closer serves as a strategic coup, potentially undermining the US-led Indo-Pacific strategy and its Quad grouping (US, India, Japan, Australia).

While some caution that competition and conflict may persist, the current trajectory indicates a genuine shift, creating space for new Asia-led trade blocs independent of Washington. This evolving dynamic is poised to complicate US efforts to isolate China globally and could reframe the Quad’s agenda from an anti-China front to a broader platform for regional public goods, signaling a new chapter in Asian geopolitics.

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