Authors: Amit Ranjan and Genevieve Donnellon-May
Can India walk the tightrope between the United States of America (U.S.) and China without losing balance and maintaining strategic autonomy?
As the U.S. and China lock horns in a bruising tariff war, countries around the world are being forced to choose sides—or at least, pretend they have not chosen a side but are securing their larger interests. Nowhere is this balancing act more delicate, or more consequential, than in the case of India. The ongoing trade war between the U.S. and China, as a result of the American administration’s decision to impose a 10% tariff on all countries and reciprocal higher tariffs on countries with which it has the largest trade deficits, has left countries across the world with few choices: negotiate with Washington or fight against the raised tariffs. More than 75 countries have opted for the first and contacted the U.S. to discuss new trade deals with the American President Donald Trump’s administration.
China has swiftly pushed back against what it sees as Washington’s escalating economic coercion, particularly Washington’s strategy of using tariff exemptions to incentivize countries to reduce trade with Beijing. In a pointed statement published in the Ministry of Commerce’s official Q&A, a spokesperson criticized Washington’s decision to impose tariffs under the guise of ‘reciprocity’ and coerce countries into restricting trade with China in exchange for exemptions, condemning it as a hegemonic ploy and “unilateral bullying” masquerading as fairness in the economic and trade sphere. Framing its response within the language of global fairness and rules-based order, China is positioning itself as a defender of the global trading system, open markets, and international trade governance amid rising protectionism from Washington.
Amidst the ongoing trade tensions, India is trying to balance its ties with the U.S. and China. The dilemma with India is due to the political character of trade and tariffs.
New agreements between India and the United States
Amid continued Sino-American tensions, U.S. Vice President J.D. Vance’s visit to New Delhi is pivotal in U.S.-India relations. Arriving on April 21 for a four-day visit, Vance met with the Indian Prime Minister Narendra Modi to reaffirm bilateral commitments and discuss a trade roadmap ahead of Donald Trump’s expected visit later this year. The visit coincides with Washington’s 90-day pause on heightened tariffs—a window during which several countries, including India, are working to secure more favorable trade terms with the U.S. India, which was previously set to face 27% tariffs and is currently being tariffed at 10%, is now engaged in fast-track negotiations to avoid such penalties.
Modi and Vance reviewed progress in various areas of bilateral cooperation outlined in February this year when the Indian leader met Donald Trump in Washington. It includes “fairness” in their two-way trade and growing their defense partnership. “We are committed to mutually beneficial cooperation, including in trade, technology, defense, energy, and people-to-people exchanges,” Modi wrote on X after meeting Vance.
Various media reports suggest that Delhi is considering tariff cuts on over half of U.S. imports—worth US$41.8 billion in 2024—as part of the negotiations to pacify Trump. But sectors like agriculture—Washington wants greater access to it, but India fiercely protects it—are still sticking points. The U.S. is India’s largest trading partner. In 2024,
U.S. total goods trade with India was an estimated US$ 129.2 billion. The US export to India amounted to US $41.8 billion, while the import from India totalled US $87.4 billion. Hence, the trade deficit for the US with India was US $45.7 billion. Some media reports say that the US wants to press India to give full market access to online retailers such as Amazon and Walmart. Even Vance said in Jaipur that the U.S. seeks greater access to the Indian market.
Beyond the economic agenda, Vance’s visit is also seen as diplomatic groundwork for Trump’s visit to India later this year for a summit of the Quad grouping, which consists of the US, India, Japan, and Australia. Modi and Trump enjoy a notably close personal rapport—Modi was among the first leaders to visit Trump following the start of his second term in January this year.
India-China relations
The recent momentum in U.S.-India trade talks carries far-reaching implications not only for bilateral ties but also for the evolving triangular dynamics among India, China, and the United States. For India, deeper engagement with Washington offers strategic and economic benefits, especially amid efforts to diversify supply chains and reduce overreliance on Chinese imports. Yet this alignment risks complicating India’s already fraught relationship with Beijing, which remains marked by intermittent border tensions.
At the heart of the border tensions lies the Line of Actual Control (LAC). India and China hold differing perceptions of the LAC’s length and alignment. For New Delhi, the LAC stretches 3,488 kilometers, whereas Beijing recognizes only around 2,000 kilometers. These divergent claims have resulted in regular friction along the border, manifesting in increased troop deployments and infrastructure development on both sides.
Earlier, in 2017, the Doklam standoff had already exposed the fragility of peace along the borders. The face-off occurred near the India-Bhutan-China trijunction, when Indian troops intervened to stop Chinese road construction in Bhutan. The standoff lasted 73 days and was only resolved through diplomatic engagement, followed by two informal summit meetings between Narendra Modi and the Chinese President Xi Jinping in Wuhan in 2018 and Mamallapuram in 2019. Despite the meeting, bilateral political matters were never settled.
Tensions reached a boiling point again in June 2020, when a violent clash erupted in the Galwan Valley, marking the deadliest confrontation between the two countries in over four decades. The incident claimed the lives of 20 Indian and four Chinese soldiers, significantly escalating hostilities and hardening public sentiment in both countries. The tensions between the two countries began de-escalating after a brief meeting between Narendra Modi and Xi Jinping at the BRICS summit in Johannesburg, South Africa, in 2023 and a talk on the sidelines of the next BRICS summit in Kazan, Russia, in 2024.
Recent overtures from China—including Xi Jinping’s reference to a “Dragon-Elephant tango” in marking 75 years of diplomatic ties—suggest that Beijing is open to a deeper engagement with New Delhi, even as both countries hedge against external shocks. Xi Jinping called on both sides to “ enhance strategic mutual trust, strengthen exchanges and cooperation in various fields, deepen communication and coordination in major international affairs, jointly safeguard peace and tranquillity in the China-India border area, promote a sound and steady development of bilateral relations, and contribute to world peace and prosperity.” Even Narendra Modi, in a podcast with Lex Friedman in March this year, stated, “We want India and China to compete in a healthy and natural way. Competition is not a bad thing, but it should never turn into conflic”t.
Conclusion
While India views the U.S. as a critical strategic partner, as New Delhi increasingly battles Beijing’s presence in the Indian Ocean region, Washington, too, sees India as a part of its larger and longer strategy in Asia. But despite this apparent convergence of interests, economic tensions are brewing beneath the surface. The immigration and visa issues and attacks on Indians and Indian-Americans also strain their ties.
As India and China commemorate 75 years of diplomatic ties, their relationship stands at a critical crossroads, marked by what India’s former foreign secretary Nirupma Rao describes as deep strategic mistrust, economic interdependence, and military tensions, yet layered with opportunities for calibrated cooperation and regional leadership. India-China, as Rao observes, is evolving a “competitive coexistence” approach that seeks to have India balance deterrence and dialogue with China while preserving its strategic autonomy amid intensifying U.S.-China rivalry.
Taking a side in the ongoing US-China conflict is not favorable to any country, including India. One of the global events that has divided the world in recent times is the Russia-Ukraine war. India’s continued ties with Russia, while staying engaged with Ukraine, exhibit India’s interest-based, skillful diplomacy of how to walk on a diplomatic tightrope. However, the US-China trade war is more complicated than the Ukraine-Russia war. This requires both rational and relational decision-making.
