How did the new warmth in India-China relations? Learn the full story behind the latest situation

New Delhi/Beijing: Relations between the world’s two largest economies, India and China are now moving in a new direction. The tariff policies of US President Donald Trump have played an important role in bringing these two neighboring countries closer to each other. In particular, new expectations have been raised in both countries regarding trade and economic cooperation, which is a major change after stressful relationships in the last few years.

The message of friendship from China

In March this year, when Trump increased commercial tension against China, Beijing expressed a desire for financial cooperation with India. According to a Bloomberg report, Chinese President Xi Jinping wrote a confidential letter to India’s President Draupadi Murmu, in which he discussed the possibilities of mutual cooperation.

In this letter, Xi expressed concern about the impact on Chinese interests from American policies and entrusted a regional officer to take diplomatic initiative with India. This message later reached Prime Minister Narendra Modi. Subsequently, Beijing released a statement in praise of India-China relations. Senior leaders like Chinese Vice President Han Zheng also appreciated the improvement relationship between the two countries.

NSA Ajit Doval and China Foreign Minister Wang Yi.

Dowal playing important role

India’s National Security Advisor Ajit Doval is playing an important role in laying the foundation of this new friendship. India’s Special Representative Dowal visited China in December 2024 and June 2025 for border talks. In June, India started concrete efforts to improve relations with China, especially when business talks with America were getting difficult.

In July, Foreign Minister S.K. Jaishankar met his Chinese counterpart Wang Yi in Beijing after 5 years. Meanwhile, Jaishankar expressed concern over the restrictions related to business obstructions and exports of China’s recent Rare Earth Metals, which were affecting India’s supply chain. In response, China assured the supply of manure and rare meaning metals.

Solid steps raised to improve relationship

Several concrete steps have been taken between the two countries to improve relations. There is a preparation to resume a direct flight between India and China from next month. China has lifted restrictions on urea exports to India, while India has resumed tourist visa services for Chinese citizens. Apart from this, business cooperation is also increasing. Gautam Adani -led Adani Group is considering a partnership for battery production with Chinese electric vehicle company BYD. Reliance Industries and JSW Group are also looking for business agreements with Chinese companies.

Reduction in Talki started in 2020

There was tension in India-China relations after the 2020 border dispute, but now both countries are committed to resolving old regional disputes. This is the reason why there were clear signs of improvement in relationships by August. Prime Minister Narendra Modi will go to China for the Shanghai Cooperation Organization (SCO) Summit on September 1 after 7 years, which will be in Tianjing. The tour is a symbol of the growing proximity between the two countries.

After the border dispute between the two countries, the relationship is gradually improving.

China expects economic reform

China’s economy is currently struggling with recession and deflation, especially in areas such as electric vehicles and solar panels. India’s 1.4 billion youth population is a large market for China, especially when commercial obstacles are increasing in the US and Europe. India is also considering Chinese investment as necessary to increase its manufacturing.

The Modi government aims to contribute to 25% of manufacturing to contribute to GDP. According to Bloomberg Economics, if the American tariffs continue, 60% of India’s export exports may be closed, which may reduce GDP by about 1%.

What is the way to see the future?

The US imposed 50% tariffs for India buying oil from Russia, which the Government of India is angry. Experts believe that Trump helped India to bring Delhi and Beijing closer by treating India as an enemy. The growing proximity between India and China is not only economic, but also from diplomatic and strategic point of view. The leaders of the two countries have repeatedly talked about economic possibilities, but the lack of trust had blocked the way. Now Trump’s tariff policy has given both of them a new opportunity, which shows new warmth in India-China relations.