Li Hongmei Interviewed by South China Morning Post

Li Hongmei    source：South China Morning Post

In the deepening shadow of US-China rivalry, India’s back-to-back trade pacts with the United States and the European Unionmark a major tilt towards stronger economic ties with the West. 

While critical details – especially the scope of any reduction in Russian energy imports under the vague US agreement – remainunclear, experts predict the twin deals will give India leverage in its relationship with China and may slow the fragile thawbetween New Delhi and Beijing.

Meanwhile, New Delhi is expected to expand its influence among the Brics countries by leveraging its chairmanship this year ofthe bloc, which Beijing views as a key voice for the Global South to counter US pressure.Brics is an acronym for 

Brazil, Russia, India, China and South Africa who founded the association in 2009. The other memberstates are Egypt, Ethiopia, Indonesia, Iran and the United Arab Emirates. 

US President Donald Trump said on Monday that the trade deal would cut American tariffs on Indian goods from 50 to 18 percent in exchange for Delhi lowering trade barriers. 

According to Trump, India would also halt its Russian oil purchases and consider imports from the US and Venezuela. Indiawelcomed the tariff relief but has yet to confirm the oil commitment. 

Just days earlier, after more than two decades of talks, India and the European Union finalised a landmark free trade agreementwhich both sides hailed as the “mother of all deals” – representing roughly one-quarter of global GDP and close to 2 billionpeople. 

Ivan Lidarev, a visiting research fellow at the National University of Singapore’s Institute of South Asian Studies, said the twodeals could slow the recent thaw in China-India relations.

“India is likely to gain greater leverage in its relations with China as a result of the trade deals and therefore will be lessaccommodating to Beijing, particularly on trade and investment issues,” he said. 

“Geopolitically, better relations with Washington will strengthen India’s international position, which was weakened last year,and help it compete more confidently and effectively with Beijing.” 

Amid intensified strategic rivalry with the US and protracted tensions with the European Union, China has doubled down inrecent years on forging closer ties with developing economies and seen a rising competition with India for influence in the GlobalSouth. 

Zhu Yongbiao, a professor from the Centre for Afghanistan Studies at Lanzhou University, said India was “revising its previouslylukewarm attitude towards Brics and the Shanghai Cooperation Organisation”. 

The SCO was set up in 2001 to tackle instability in Central Asia following the Soviet collapse and has since become a key platformfor the Global South. It has rapidly expanded since the late 2010s in tandem with Beijing’s global leadership ambitions.

According to Zhu, the deal with the US will negatively affect Delhi’s ties with Moscow but “does not decisively repair its relationswith Washington, because the US diplomatic style is to demand sacrifices from others without making equivalent commitments”. 

Zhu said that if India cut Russian oil purchases, “the most the US will do is refrain from sanctioning India – it will not offer equalcompensation”. Meanwhile, India’s concessions could “damage its diplomatic reputation and its image as a responsible majorpower, rather than enhancing its international standing”.

As part of improving bilateral ties, Indian Prime Minister Narendra Modi and Chinese President Xi Jinping met last year, astensions between Delhi and Washington were on the rise. 

During the meeting, on the sidelines of the Shanghai Cooperation Organisation summit in Tianjin, both sides agreed that theyshould be development partners instead of adversaries. 

In the weeks leading up to the encounter in August, India lifted tourist visa restrictions for Chinese citizens and direct flightsresumed between the two countries. Beijing also reinstated permits for Indian pilgrims to visit major shrines in the Tibetautonomous region. 

Lin Minwang, professor and vice-dean at Fudan University’s Institute of International Studies, said China-India relationscontinued to be strained by border tensions and geopolitical rifts, despite the signs of stabilisation in recent months. 

Bilateral ties had already “hit rock bottom” after the June 2020 Himalayan border clash that killed some 20 Indian and at leastfour Chinese troops and were “unlikely to deteriorate further”, he noted.

“However, a significant recovery won’t be easy either,” Lin added, citing structural tensions and India’s view of China as its mostsignificant rival. 

He emphasised that India’s westward economic tilt was not new, pointing to Delhi’s withdrawal from the China-backed RegionalComprehensive Economic Partnership in 2019. 

“It’s not these agreements that bind India to the US and EU but rather its own ideology and strategic preferences, which alignwith those of the West,” Lin said. “As for how far this alignment can go, I think it should not be overestimated. After all, as a majorcountry, India inevitably has its own demands for autonomy.” 

Li Hongmei, a research fellow at the Shanghai Institutes for International Studies’ Centre for South Asian Studies, also arguedthat while the trade deals might increase India’s bargaining power with China, Beijing had little reason to feel “strategic anxiety”. 

The decisive factor in China-India relations remained the border dispute, not trade deals, she said, adding that it would beunlikely for New Delhi to abandon its multi-alignment strategy. 

India has historically advocated for strategic autonomy and maintained a balancing strategy among major powers. 

“Even if it occasionally tilts more towards one side, it will not fully follow another country’s strategy at the expense of its ownnational interests and strategic independence,” Li said. 

Lidarev also cautioned against overestimating the impact of the latest trade breakthroughs, pointing to the trust deficit betweenDelhi and the Trump administration.

In August, Trump abruptly doubled tariffs on Indian goods after calling India a “dead” economy and accusing Delhi of fundingMoscow’s war in Ukraine by buying Russian oil. 

Unlike the EU pact which elevated Brussels-New Delhi ties to a “true partnership”, the agreement announced by Trump “simplycalms a turbulent period in bilateral relations – the damage of which cannot be washed away”, he said. 

“US-India relations are unlikely to recover fully any time soon,” Lidarev added, citing a combination of weakened trust and thedangers of Delhi’s reliance on Washington. 

“The result will be a relatively strong but more constrained and mistrustful US-India partnership. This is a major change from ayear ago and, undeniably, a net gain for China,” he said, adding that the precise contents of the US-India deal remained unclear. 

With Delhi holding the Brics chairmanship this year, India’s trade realignment with the US may also complicate cooperationwithin the Beijing-led grouping, according to observers. 

Lidarev said India was likely to “resist a more hardline Brics stance against the US, both in terms of rhetoric and measures aimedat weakening the United States’ global position”. 

Echoing his view, Lin pointed out that Delhi had always been attentive to Washington’s sensitivity towards the Brics grouping,which Trump regards as an anti-American organisation. 

“Therefore, India will be likely to make sure that any initiative or proposal perceived as anti-American or challenging UShegemony will find it very difficult to gain support or be passed during this year’s summit,” he said.