Reeling from Trump’s tariffs, India and China seek a business reboot » Capital News

India’s Prime Minister Narendra Modi landed in China on Sunday with the sting of Donald Trump’s US tariffs still top of mind.

Since Wednesday, tariffs on Indian goods bound for the US, like diamonds and prawns, now stand at 50% – which the US president says is punishment for Delhi’s continued purchase of Russian oil.

Experts say the levies threaten to leave lasting bruises on India’s vibrant export sector, and its ambitious growth targets.

China’s Xi Jinping, too, is trying to revive a sluggish Chinese economy at a time when sky-high US tariffs threaten to derail his plans.

Against this backdrop, the leaders of the world’s two most populous countries may both be looking for a reset in their relationship, which has previously been marked by mistrust, a large part of it driven by border disputes.

“Put simply, what happens in this relationship matters to the rest of the world,” Chietigj Bajpaee and Yu Jie of Chatham House wrote in a recent editorial.

“India was never going to be the bulwark against China that the West (and the United States in particular) thought it was… Modi’s China visit marks a potential turning point.”

Modi is travelling to China for the Shanghai Cooperation Organisation (SCO) – a regional body aimed at projecting an alternative worldview to that of the West.

Members include China, India, Iran, Pakistan and Russia.In the past, India has downplayed the organisation’s significance. And critics say it hasn’t delivered on substantial outcomes over the years.

The June SCO defence ministers’ meeting failed to agree on a joint statement. India raised objections over the omission of any reference to the deadly 22 April attack on Hindu tourists in Indian-administered Kashmir, which led to the worst fighting in decades between India and Pakistan.

But experts say the downturn in Delhi’s relations with Washington has prompted India to rediscover the utility of the SCO.

China, meanwhile, will value the optics of Global South solidarity amid Trump’s tariff chaos.

The Brics grouping – of which China, India, Russia, Brazil and South Africa are the founding members – has drawn the ire of Trump, who has threatened to slap additional tariffs on group members on top of their negotiated rates.