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Reeling from Trump’s tariffs, India and China seek a business reboot
India’s Prime Minister Narendra Modi landed in China on Sunday with the sting of Donald Trump’s US tariffs still top of his 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.”
India and China are economic powerhouses – the world’s fifth and second largest, respectively.
But with India’s growth expected to remain above 6%, a $4tn (£3tn) economy, and $5tn stock market, it is on the way to moving up to third place by 2028, according to the International Monetary Fund (IMF).
“While the world has traditionally focused on the single most important bilateral relationship in the world, US and China, it is time we shift more focus on how the second and would-be third largest economies, China and India, can work together,” says Qian Liu, founder and chief executive of Wusawa Advisory, based in Beijing.
But the relationship is deeply challenging.
The two sides have an unresolved and long-standing territorial dispute – that signifies a much broader and deeper rivalry.
Violence erupted across Ladakh’s Galwan Valley in June 2020 – the worst period of hostility between the two countries in more than four decades.
The fallout was largely economic – a return of direct flights was taken off the table, visas and Chinese investments were put on hold leading to slower infrastructure projects, and India banned more than 200 Chinese apps, including TikTok.
“Dialogue will be needed to help better manage the expectations of other powers who look to India-China as a key factor of Asia’s wider stability,” Antoine Levesques, senior fellow for South and Central Asian defence, strategy and diplomacy at IISS, says.
There are other fault lines too, including Tibet, the Dalai Lama, and water disputes over China’s plans to build the world’s largest hydroelectric power project across a river shared by both nations, as well as tensions with Pakistan after the Pahalgam attack.
India also does not currently enjoy good relations with most of its neighbours in South Asia, whereas China is a key trading partner for Pakistan, Bangladesh, Sri Lanka and Afghanistan.
“I would be surprised if a BYD factory is coming to India, but there may be some soft wins,” Priyanka Kishore, founder and principal economist at research company Asia Decoded, says.
It’s already been announced that direct flights will resume, there may be more relaxations on visas, and other economic deals.
However, the relationship between Delhi and Beijing is “an uncomfortable alliance to be sure”, notes Ms Kishore.
“Remember at one point, the US and India were coming together to balance China,” she adds.
But India is completely perplexed with the US and its position: “So it’s a smart move – and feeds into the multipolar narrative that both India and China believe in.”
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.

Modi last met Xi and Russia’s Vladimir Putin at the Brics summit in Russia in October 2024. Last week, Russian embassy officials said Moscow hopes trilateral talks with China and India will take place soon.
“Leveraging each of their advantages – China’s manufacturing prowess, India’s service sector strengths, and Russia’s natural resource endowment – they can work to reduce their dependence on the United States to diversify their export markets and ultimately reshape global trade flows,” Bajpaee and Yu said in their editorial.
Delhi is also leveraging other regional alliances, with Modi stopping in Japan on the way to China.
“Asean and Japan would welcome closer co-operation between China and India. It really helps in terms of supply chains and the idea of Make in Asia for Asia,” Ms Kishore says, referring to the political grouping comprising 10 Southeast Asian economies.
India continues to be reliant on China for its manufacturing, because it sources raw materials and components from there. It will likely be looking for lower import duties on goods.
India’s strict industrial policies have so far held it back from benefiting from the supply chain shift from China to South East Asian countries, according to experts.
There is a case for partnership, a strong one, says Ms Kishore, where India pitches to manufacture more electronics.
She points out that Apple makes airpods and wearables in Vietnam, and iPhones in India, and so there would be no overlap.
“Faster visa approvals would be an easy win for China as well. It wants market access in India either directly or through investments. It’s dealing with a shrinking US market, it’s already flooded Asean markets, and a lot of Chinese apps like Shein and TikTok are banned in India,” says Ms Kishore.
“Beijing would welcome the opportunity to sell to 1.45 billion people.”
Given the complexity of the relationship, one meeting is unlikely to change much. There is a long way to go on improving China-India ties.
But Modi’s visit to China could repair some animosity and send a very clear signal to Washington that India has options.
[BBC]
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Trump meets Iraq PM at White House, promises ‘a lot of deals’
United States President Donald Trump and Iraqi Prime Minister Ali al-Zaidi have met at the White House in Washington, DC, with both leaders pledging to deepen economic ties and boost Iraq’s oil output.
The meeting on Tuesday came after Trump threw his support behind al-Zaidi, a businessman with no history in politics, and publicly opposed Iraq’s former Prime Minister Nouri al-Maliki for the prime ministerial role earlier this year.
Al-Maliki, a divisive figure seen as having close ties to Iran, subsequently dropped out of contention in April.
The Iraqi government had previously said it expected several oil and gas agreements to be signed during al-Zaidi’s visit to the US, with Trump also vowing a raft of deals during the Oval Office meeting.
He called al-Zaidi “a fantastic champion, a new champion”.
“Iraq has tremendous potential because of their oil and because of other things, but because of their oil, and we’re going to be doing a lot of deals,” Trump said.
“We’re going to create a lot of jobs for both countries, and we’re going to be taking out a lot of oil. A lot of oil is coming out,” he said.
Al-Zaidi, meanwhile, said the “visit was not like any other visit”, calling it the beginning of an “economic partnership”.
He said US-Iraqi relations were shifting from militaristic to economic.
Both he and Trump said the remaining US forces in Iraq, believed to number fewer than 2,000, would completely withdraw from Iraq by September 30. That is the same date al-Zaidi pledged that armed factions active across Iraq would disarm.
Iraq has long contended with the competing influences of Tehran and Washington in its domestic politics, with tensions over the continued US troop presence, deployed amid the conflict with ISIL (ISIS), and the pull of Iran-aligned armed groups.
In his first speech in parliament as prime minister, al-Zaidi vowed to disarm the country’s varied paramilitary groups, which have wielded power since the 2003 US-led war on Iraq.
He has not said how he will achieve the ambitious goal. Shortly before his departure, the Islamic Resistance in Iraq, an umbrella group of Iran-backed armed groups in the region, including Iraq, said it would reject any outcomes of al-Zaidi’s visit.
Iraq has also been one of several fronts in the US-Israeli war with Iran that began on February 28, with the conflict looming and its recent escalation looming large during al-Zaidi’s visit.
Iraq’s economy has also been particularly hard hit by Iran’s effective closure of the Strait of Hormuz, with about 90 percent of its 3.4 million barrels per day of fossil fuel exports passing through the water.
The recent fighting has thrown into question the future of a memorandum of understanding (MoU), which in June beckoned in a temporary end to the fighting, the opening of the Strait of Hormuz, and the lifting of a US naval blockade on Iran.
Speaking to reporters at the White House, al-Zaidi also said that Iraq needs a “fair share” from the Organization of the Petroleum Exporting Countries (OPEC).
Iraq has been pushing for a higher quota on its oil production, with al-Zaidi saying the need is a direct result of the destruction caused by the war against ISIL, over which Iraq officially declared victory in 2017.
“The damage suffered by Iraq exceeds $400bn, and to this day, some Iraqis still have destroyed homes and are living in camps,” he said. “I have a plan to return them to their homes, and that is why I want a fair share for Iraq in OPEC.”
[Aljazeera]
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Spain deliver masterclass to beat France 2-0 and reach World Cup final
Spain snuffed out France’s dream of a third World Cup triumph, taming their galaxy of forwards to win 2-0 and progress to a final against England or Argentina.
Didier Deschamps’ men were hot favourites for the trophy after a string of breathtaking displays in the United States but they met their match against the slick European champions at the semifinal stage on Tuesday.
Mikel Oyarzabal opened the scoring for the 2010 winners with an emphatic penalty in the first half in Arlington, Texas, and Pedro Porro doubled their lead in the second half.
Shell-shocked France could not find a way back into the match despite their wealth of attacking riches.
The game at the Dallas Stadium caught fire midway through the first half when Salvadoran referee Ivan Barton pointed to the penalty spot after a reckless challenge by France left-back Lucas Digne on Spain winger Lamine Yamal.
Oyarzabal hammered the ball past France goalkeeper Mike Maignan for his fifth goal of the World Cup to leave France trailing for the first time in the tournament.

Minutes later they suffered another blow when centre-back William Saliba had to leave the pitch after a recurrence of his lower back injury, replaced by Crystal Palace defender Maxence Lacroix.
Spain went agonisingly close to extending their lead after some dazzling one-touch football but Dayot Upamecano’s challenge denied Fabian Ruiz.
France finished the half without a single shot on target, and just two attempts overall.
Deschamps threw on Desire Doue for Bradley Barcola in the 57th minute in a bid to supercharge his attack but a minute later they were 2-0 down after a stunning team goal for Luis de la Fuente’s men.
Defender Porro delivered a sharp pass to the feet of Dani Olmo on the edge of the box and collected the return ball before coolly slotting past Maignan.
(Aljazeera)
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S. N. B. M. Patdmasiri appointed Director General of the Department of Government Factories
The Cabinet of Ministers approved the resolution furnished by the Minister of Housing, Construction and Water Supply to
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