Will Trump's Tariffs Cause Thaw In India-China Relations?

India and China appear to be cautiously moving towards a thaw in their strained relationship, with New Delhi resuming tourist visas for Chinese nationals, an easing that comes five  years after they were suspended during the pandemic and never restored following the deadly Galwan Valley clash in 2020. Chinese citizens can now start submitting India visa applications in Beijing, Shanghai and Guangzhou beginning Thursday July 24. 

On Wednesday,  Indian and Chinese officials met in New Delhi for the 34th meeting of the Working Mechanism for Consultation and Coordination on border affairs (WMCC), which had been in place to ensure peace and tranquility on the India-China border. These  moves signals a tentative reset between the Asian rivals, who have kept ties in deep freeze since the border standoff. Earlier this month, External Affairs Minister Subramanyam Jaishankar’s warm bilateral talks in Beijing with his Chinese counterpart Wang Yi  added to signs that both sides are testing the waters for a full scale revival of ties. Jaishankar was in China for a meeting of the foreign ministers of the Shanghai Cooperation Organisation (SCO) and also called on President Xi Jinping together with other SCO foreign ministers.

Thaw

The thaw in India-China ties began after the border agreement of 21 October 2024,  when the last sticking point on border patrols were resolved. Till the Chinese forces  moved back to where they were before the military confrontation, India had refused to get back to business, as the Chinese had long wanted.

 The same month, after the border agreement was done, Prime Minister Narendra Modi met President Xi Jinping on the sidelines of the BRICS summit  in Kazan. The ice was broken in this meeting and the top political leaders gave the green signal to normalise ties that had come to a halt following the Ladakh intrusions.

 China had over the years regularly intruded into areas that India claims is its territory. The problem in both the eastern and western border with China is that many of the areas are not properly demarcated. China also claims the whole of Arunachal Pradesh as its own, saying it is part of Tibet the autonomous region that the Chinese Communist party took over in the fifties

WMCC meeting

At the WMCC meeting, officials reviewed the situation on the border areas and were satisfied that the situation remained peaceful. `They agreed to maintain regular exchanges and contacts on issues related to the boundary affairs at the diplomatic and military levels through established mechanisms. With a view to advancing effective border management and sustaining peace & tranquility, the two sides deliberated on various measures as explored during the previous (23rd) round of Senior Representatives Talks and the 33rd meeting of WMC,” the MEA said in a statement late Wednesday evening.  The two sides also prepared for the next round of the Special Representatives' Talks on the India-China Boundary Question to be held in India later this year, the statement added.

Mistrust Remains 

The current thaw in relations between India and China does not mean that all is well. Both sides are suspicious of each other. Fundamental differences on the border dispute, China’s iron clad friendship with Pakistan, including Beijing support for Islamabad during the recent Sindoor face-off, China’s suspicion of India’s growing closeness with its arch rival the US, as well as India’s active participation in the quad, are in place. Till India and China can resolve their border issue, suspicion will remain and  chances of another Galwan cannot be ruled out. But for now, the mood in both Delhi and Beijing is for relations to get back on track.

Trade War had helped to push India and China closer

 US President Donald Trump’s decision to  unleash a tariff war on the world has led to major disruption across the world with countries scrambling to fortify their economies. Trump’s tough stand on tariffs have led nations to look around for alternatives. This is  one reason why India and China are hoping to stabilise economic relations, China needs India’s huge market, while India  depends  on China, as does most of the world  for providing inputs for its manufacturing sector. India’s pharmaceutical sector relies heavily on China, so does its growing  Electric Vehicle production units, where dependence is nearly 93 percent on China’s rare earth magnets, critical for motors and batteries. Besides there are numerous other products including solar panels for export that require inputs from China. This has pushed both countries to normalise ties at a time of disruption to the world trading system. Despite fundamental and  strategic differences, pragmatism has led India and China to avoid further conflict and work towards normalisation of trade that will be beneficial to both Asian neighbours.