India US Trade 2025: Tensions Rise as Modi Heads to China

Saturday, September 13, 2025
1 min read
Workers in a factory inspecting and handling stacks depicting India US trade 2025

Indian Prime Minister Narendra Modi is scheduled to visit China on August 31, 2025, to attend the Shanghai Cooperation Organisation (SCO) summit in Tianjin, marking his first trip to the country since the 2020 Galwan Valley border clashes.

The visit comes amid escalating tensions about india US trade 2025, following President Donald Trump’s imposition of 25% tariffs on Indian exports and threats of further penalties over India’s continued purchase of Russian oil. These measures are said to target BRICS countries aligned against U.S. policies.

Modi’s Last Visit to China

Modi’s last visit to China was in June 2018. Ties deteriorated sharply after the 2020 Himalayan standoff. However, a thaw began with discussions between Modi and Chinese President Xi Jinping at the BRICS summit in October 2024, paving the way for renewed engagement.

In parallel diplomatic activity, National Security Adviser Ajit Doval is in Moscow to address India’s defense cooperation and Russian oil imports, and Foreign Minister Subrahmanyam Jaishankar is scheduled to visit China shortly after Modi’s trip.

India US Trade 2025: Overall Volume

India’s exports to the U.S.—worth approximately $81 billion in 2024—account for about 2% of GDP. With tariffs threatening roughly 80% of that trade, India could lose price competitiveness in critical sectors like textiles, pharmaceuticals, gems, and petrochemicals. Yet economists expect only limited impact on overall economic growth due to the size of India’s domestic economy.

The SCO summit provides a platform for Modi to rebalance India’s regional alignments, signaling diplomacy with Beijing as tensions with Washington escalate. However, key challenges around trade, defense ties, and regional stability remain unresolved.

Published in SouthAsianDesk, August 6th, 2025

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