## 📈 India-China Relations Pivot Amid Global Trade Shift

Chinese President Xi Jinping has signaled a diplomatic reset, characterizing India and China as "friends and partners" in his Republic Day message to President Droupadi Murmu. This warming of ties follows years of tension and is heavily influenced by the shifting global trade landscape. • Economic Resilience & Trade Figures Bilateral trade between the two Asian giants remains robust, crossing an annual US$ 130 Bn despite previous curbs. However, India faces a significant trade deficit of approximately US$ 99.2 Bn (FY25). • Global Context: The "Tariff War" The rapprochement is accelerated by the US administration’s trade policies: India: Exports to the US now face tariffs of 50%. China: Goods are subjected to tariffs exceeding 30%. BRICS: Both nations are leveraging their status as founding members to counter Western trade pressures. • Sectoral & Investment Easing New Delhi is signaling a shift from its 2020 restrictive stance: Aviation: Direct flights resumed in late October 2025 after a five-year hiatus, starting with the Kolkata-Guangzhou route. Infrastructure & Power: The Finance Ministry is reportedly considering scrapping curbs on Chinese firms bidding for government contracts, potentially impacting sectors like thermal power and renewable energy. ICT & Electronics: Visa red tape has been reduced for Chinese professionals to support domestic electronics manufacturing and technology transfer. • Strategic Outlook While border issues remain, the "Dragon and Elephant" are prioritizing economic pragmatism. India is cautiously re-engaging to address project delays and promote its goal of becoming a US$ 4.13 Tn economy. _Summary based on current reports and provisional trade data._