Experts believe that future developments between the US and China would determine the fate of emerging markets, including India, and could pose multifaceted challenges for New Delhi as the global power play unfolds.
Published: October 31, 2025 10:07 PM IST
US-China trade deal: The recent meeting between US President Donald Trump and his Chinese counterpart Xi Jinping marked a significant shift in the global power balance as the two countries de-escalated long-standing trade tensions, with Beijing standing as an equal to Washington, a phenomenon signalling a rapid shift towards a G-2 world.
How US-China deal could determine India’s fate?
Experts believe that future developments between the US and China would determine the fate of emerging markets, including India, and could pose multifaceted challenges for New Delhi as the global power play unfolds.
“US will have to make concessions to China in the future. What has happened is absolutely clear. This cannot be presented as a victory for the US. It is simply the result of understanding that there are some things that the US cannot do or is not good at, and it will have to compromise. China showed how to negotiate as an equal,” says market expert Manish Singh.
Singh believes that while India is not yet in a position on an equal footing with the United States, the message for New Delhi is clear; New Delhi needs to focus on internal strength to stand toe-to-toe with Washington. “China has shown the way that if you strengthen yourself internally and have options, you can one negotiate on an equal footing… The US doesn’t have all the strong cards that people think it does, because a lot has changed in the last 10-20 years,” he asserted.
Singh also said that while India may not yet be in a position to negotiate on an equal footing, the message for New Delhi is clear: “China has shown the way that if you strengthen yourself internally and have options, you too can one day negotiate on an equal footing… The US doesn’t have all the strong cards that people think it does, because a lot has changed in the last 10-20 years.”
Why US-China trade deal could be trouble for India?
According to Manish Singh, India is one of the beneficiaries of the US-China trade war as global firms, especially US companies, moved away from China when trade tension blew up between Beijing and Washington during Trump’s first presidential term. However, India’s supply chain could be in major jeopardy if US and China reach a trade agreement because US majors would move back towards Beijing as the threat of tariffs is removed.
“You’ll see smaller deals, like the ones we saw yesterday. I call them subscription diplomacy because you have a 12-month deal that can be renewed. There’s room for changing the terms. It could come up for renewal even before the term expires,” the expert said on recent US-China agreements.
Singh believes that these small deals are beneficial for emerging markets, including India. “If it becomes the norm that concessions will be given and deals will be struck, it is very good news for emerging markets, especially China and other countries… If this increases trade, it is good news for everyone, including India.”
Notably, India has witnessed a mass exodus of foreign investors in the current fiscal year, with around Rs 1.9 lakh crore from Indian equities, raising concerns about appetite. But, according to Singh, India’s macroeconomic picture still shows positive signs and expressed optimism about growth prospects.
“I am very bullish about growth. I think the Fed is wrong. Inflation is not a problem… For me, easing tensions between the US and China would be very positive.
Is global economy moving towards a ‘G2 world’?
Manish Singh argues that the global economy is rapidly moving towards a “G2 world”, where the US and China independently co-exist as the two largest economic superpowers, who collaborate rather than collide.
“I never viewed the US-China trade tensions as a war, but a shift towards a G2 world where the US and China will have to coexist. The US doesn’t have a strong position, and for me, that’s very positive because a lot of investment that was stalled… will now flow back in.”
Why China prevailed in the trade war?
Singh explained how China prepared for years, even decades, to ultimately be powerful enough to stand toe-to-toe with the United States.
“There’s no doubt about it… they’re experts. They were expecting this. When the tariff war first started, they went back and started preparing for it, and seven years later, they’re winning,” he said.
Singh said the message for India is to continue to build its domestic strength, maintain flexibility in global trade alliances, and prepare for the long game in a world which is today defined by negotiation rather than confrontation.
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