Why is China uneasy about US-India trade negotiations? Can India defeat Beijing as an alternative manufacturing hub?
Analysts believe that the main reason for China’s unhappiness is the possibility that India will become an alternative manufacturing center. In the U.S. tariffs on Chinese goods reach 245%, which makes it nearly impossible for Beijing to export, and other countries may turn investment and market transfers disappear?
PM Narendra Modi and US Vice President JD Vance
Although China has not yet named India, it expressed concern about the growing Bonhomie between the United States and New Delhi and ongoing discussions on reconciliation of disputed issues in reciprocal tariffs and bilateral trade agreements. Beijing said on Monday that it said it was unwilling to sign a trade deal with Washington at the expense of immunity from U.S. President Donald Trump’s tariff regime.
Will India become an alternative manufacturing center?
Analysts believe that the main reason for China’s unhappiness is the possibility that India will become an alternative manufacturing center. The U.S. tariffs on Chinese goods reached 245%, making it nearly impossible for Beijing to export, and other countries may transfer investment and markets from China. India is holding talks with the United States, and the two countries may reach an agreement before the end of the 90-day deadline, as India is a consumer-led economy and has low export dependence, which may give it leverage.
Modi’s Saudi visit in the afternoon
China expressed concern the day before Prime Minister Narendra Modi’s trip to Saudi Arabia, and the country had earlier shown interest in investing $100 billion in India. It shows India’s strategy and capabilities, mainly at the expense of China to attract global investment.
China, the United States wants diversified companies?
United States-After the start of the China trade war, many companies plan to diversify their supply chains and leave China. With a large, skilled, cheap labor and government incentives such as production-related incentives (PLI) schemes, New Delhi is likely to become a viable alternative. It can be measured by the fact that even Chinese companies such as Haier and Shanghai have accepted India’s strict investment rules, such as having a minority stake in joint ventures so that they can enter the Indian market and bypass our tariffs.
China is also aware of a huge and almost insurmountable trade surplus with India. India’s reliance on Chinese components clearly shows that India will depend on China for at least some time, so Beijing should not be afraid of India.
China extends to India
China is cautiously moving forward, India urges India to “stand up together” on our tariffs and reminds both countries that are developing economies and may be hurt by American protectionism. The Chinese Embassy in India has taken a step forward, saying that China-India’s trade relations are “complementary and mutually beneficial.” He also warned that U.S. tariffs would deprive the global South of its right to development. Analysts believe that taking advantage of the U.S.-China tensions are best suited for India to secure trade franchise.
India – China’s geopolitical reality
China is also aware of the geopolitical reality. It believes that, to some extent, the deep connections between New Delhi and the United States are part of a broader strategy to boycott China’s influence in Asia. After tensions amid the 2020 Ladakh border conflict and India’s restrictions on investment in China, it is clear that India may take a tough stance in the South China Sea. It is obvious from the facts below that China’s national media criticized India for “echoing American remarks” in order to beg the Trump administration. It shows its uneasiness with India’s alignment with the United States to geopolitically isolate China.
