Modi in China: Eurasian Diplomacy Meets US Tariff Tensions

Prime Minister Narendra Modi’s participation in the 25th Shanghai Cooperation Organization (SCO) Summit in Tianjin, China marked a carefully calibrated diplomatic step, underscoring India’s strategic balancing act in an increasingly fragmented global order. Against the backdrop of escalating US tariffs on Indian goods, pressure over Russian oil imports, and unresolved border disputes with China, the visit highlighted both the opportunities and risks of India’s multipolar positioning.

India’s Posture at Tianjin

Modi’s address at the SCO focused on three recurring themes: security, connectivity, and opportunity. He urged collective action against terrorism, highlighted economic corridors such as the Chabahar Port and the International North-South Transport Corridor (INSTC), and called for expanded opportunities for youth and startups. By endorsing the SCO’s new Development Strategy (2026–2035) and the proposal for a SCO Development Bank, India signalled openness to Eurasian financial mechanisms that reduce reliance on the dollar, even as it continues to deepen integration with Western-led frameworks like the G20.

India’s stance was neither wholesale embrace nor outright rejection of SCO initiatives. New Delhi reaffirmed its red lines on sovereignty-sensitive projects, but demonstrated willingness to leverage platforms with Russia and China when strategically useful—reflecting a pragmatic, selective engagement.

India–China Reset?

The most notable development was Modi’s first bilateral meeting in China with President Xi Jinping in seven years. The two sides agreed to resume direct flights, reopen border dispute dialogue, and expand trade and cultural exchanges. While structural mistrust remains, particularly after years of border standoffs, these gestures suggest a limited reset aimed at stabilising ties.

For India, this provides tactical breathing space: engagement with China within the SCO helps avoid strategic isolation in Eurasia, while signalling to domestic and international audiences that New Delhi retains diplomatic options beyond the West.

US Reaction: Unease and Alarm

The optics of Modi alongside Xi and Putin drew sharp reactions in Washington. Media commentary and think-tank voices interpreted India’s presence as evidence of a “multipolar drift.” Republican figures accused the US of mismanaging relations and “losing” India to China and Russia, while Democratic voices framed it as proof of Trump’s tariff policy backfiring. In response, Trump himself softened his rhetoric, calling India a “special friend” and downplaying suggestions of a permanent rift. Yet he also hinted at a second stage of sanctions on Russia and countries importing Russian oil—implicitly keeping India under scrutiny. This dual message reflects Washington’s attempt to balance reassurance with deterrence, even as India’s energy calculus diverges from US policy.

Implications for India’s Strategy

India’s participation at the SCO underscores its long-standing doctrine of strategic autonomy. New Delhi is signalling that it will cooperate with Eurasian blocs on terms that advance its own interests, without compromising relationships with the West. The summit also reinforces the momentum toward a multipolar world order, with India positioning itself as a bridge between advanced economies and the Global South. By endorsing initiatives such as the SCO Development Bank and regional connectivity projects, India has shown willingness to engage in frameworks that rebalance economic flows away from dollar dominance, a trend that could carry wider geoeconomic consequences.

At the bilateral level, the summit provided an opening for a limited reset in India–China relations, with resumed flights, border dialogue, and trade discussions signalling cautious pragmatism despite unresolved disputes. Yet the deeper structural rivalry with Beijing, particularly in the Indo-Pacific, remains intact. On the US front, Trump’s softened tone—calling India a “special friend”—offers reassurance, but his parallel warning of potential second-stage sanctions on Russia and its oil buyers highlights the fragility of US–India ties if energy divergence persists. In sum, the SCO has provided India an opportunity to project autonomy, extract tactical benefits, and keep its diplomatic options open, but it has also sharpened the need to navigate growing external pressures with care.