India accuses the US of becoming a "bad actor" in trade talks with China

The current shift in US trade policy, spearheaded by Donald Trump’s administration, signals a tightening stance specifically toward China while offering strategic openings for countries like India. Here's a breakdown of what it all means:

1. US Tariffs: A Negotiation Tool, Not a Trade War

While Trump has announced sweeping reciprocal tariffs across many nations, Treasury Secretary Scott Bessent clarified the intent — this isn’t a trade war, but a pressure tactic against “bad actors,” with China squarely in the crosshairs. China has retaliated with a massive increase in tariffs on US goods — from 34% to 84% — escalating tensions into a full-scale tariff standoff.

2. 90-Day Pause: Relief for Most Countries (Including India)

Trump’s decision to pause the tariffs on most countries for 90 days is a deliberate negotiation strategy, according to Bessent. This window allows trade partners to come forward for bilateral talks. India, facing a 26% tariff (pharmaceuticals and semiconductors excluded), gets a crucial breather to solidify its trade position.

3. China’s Isolation & Regional Realignment

Bessent made it clear the US is actively working with China's regional peers — Vietnam, Japan, South Korea, and India — to reorient supply chains and build alternate trade ecosystems. The message is: you’re either with us or with China. The aggressive 125% tariff on Chinese goods is intended to pressure companies to relocate production, and India could benefit directly from this shift.

4. Implications for India

• Short-Term: Indian businesses avoid immediate tariff shocks and can maintain trade momentum with the US.

• Medium to Long-Term: India is being seen as a strategic alternative to China. Companies seeking to escape high tariffs may explore relocating manufacturing to India, especially in electronics, apparel, and automotive parts.

• Trade Deal on Track: The bilateral trade agreement (BTA), discussed during PM Modi’s US visit, is progressing. Both sides have already agreed to the terms of reference, and a final deal is expected by autumn 2025. This could lock in long-term trade benefits for India.

5. What India Needs to Watch

• The US still sees India as a “big abuser” of trade ties, so concessions might come with strings attached.

• Sectors not covered by the exemption (e.g., textiles, steel) may still face scrutiny unless they’re part of the new deal.

• India must navigate this diplomatically, leveraging its strategic importance while avoiding entanglement in US-China rivalries.

In essence, Trump’s tariff storm has created global trade turbulence — but India, with careful navigation and timely agreements, might just find itself in calmer waters than most.