Trump tariffs reshape regional commerce

India is focusing on growing trade with Russia and China in the wake of 50% tariffs introduced by US President Donald Trump. Describing US-India relations as being in a “diplomatic free fall”, Michael Froman, president of the Council on Foreign Relations, commented that this was made public when Chinese president Xi Jinping, Indian prime minister Narendra Modi, and Russian president Vladimir Putin “strode together, awkwardly holding hands, beaming for the cameras” at the Shanghai Cooperation Organization (SCO) summit hosted in Tianjin, China, this month. In an aside at the summit, Xi went so far as to proclaim that it was “time for the dragon and elephant to dance together”, added Froman. Before the tariffs, the US was India’s biggest export market. In contrast, it has a trade deficit with both Russia and China, its partners in the original Brics grouping. The Russian deficit is largely due to the importation of discounted refined petroleum, crude oil and coal. India exports pharmaceuticals and steel to Russia. Trade between India and Russia reached a record high of $68.7 billion in the financial year to March 31. India’s exports totalled $4.9bn, while imports from Russia amounted to $63.8bn, according to the Indian embassy in Moscow. Commenting on a 78-year diplomatic and regional relationship between the two countries, the embassy states: “The India-Russia partnership has been among the steadiest in the contemporary era, with a shared commitment to a multipolar world as well as to expanding the engagement beyond the traditional military, nuclear and space cooperation. In the past two years, the bilateral trade has expanded significantly.” There is concern in India over a widening trade gap with China, with India’s trade deficit with China reaching $99.21bn for the fiscal year ending March. In 2024-25, India exported goods valued at $14.25bn, while importing $113.5bn worth of goods from China, which accounts for 35% of the Indian trade deficit, according to official statistics. “Though trade volumes have grown exponentially, they have also led to the biggest single trade deficit India is running with any country,” comments the Indian embassy in Beijing. It says India’s concerns over the trade deficit are due to the size of the deficit and the fact that it has been continuously widening. India’s main exports to China over the past five years have been raw material commodities such as iron ore, light naphtha, p-xylene, shrimps and castor oil. Chinese exports include machinery, electronics, personal computers, monolithic integrated circuits, lithium-ion batteries and fertilisers. “We continue to engage the Chinese side for addressing market access issues,” the embassy states. ER