Elephant-dragon tango: Modi's visit to China signals improving ties — will the bonhomie last?

When Foxconn recalled hundreds of Chinese engineers from a mill successful India past month, reportedly pursuing Beijing's directions to curb exertion transportation to its neighbor, it was a reminder of the uneasy ties betwixt 2 of Asia's largest economies.

But with some countries facing tariff vigor from Washington, could economical challenges propulsion Beijing and New Delhi toward reluctant cooperation, transforming their adversarial relationship?

That anticipation volition beryllium tested implicit the play successful Tianjin, wherever India's Prime Minister Narendra Modi is owed to conscionable China's President Xi Jinping for the 25th Shanghai Cooperation Organization summit. It volition beryllium Modi's archetypal sojourn to China successful 7 years, aft the deadly Galwan Valley clashes betwixt Indian and Chinese soldiers successful 2020 soured relations.

New Delhi and Beijing could prosecute successful talks successful Tianjin, arsenic India's overseas ministry has flagged the anticipation of bilateral meetings connected the sidelines of the summit.

India-China experts mostly bash not spot the acme arsenic the opening of a long-lasting relationship betwixt the 2 countries. "The suspicion of China runs heavy successful India," Amit Bhandari, elder fellow, energy, investments and connectivity, a deliberation vessel Gateway House. But successful the look of U.S. tariffs and shifting proviso chains, China and India find themselves edging toward each other.

During his two-day sojourn to Delhi, past week, Chinese Foreign curate Wang Yi said that India and China should presumption each different arsenic "partners" alternatively than "adversaries oregon threats".

"It is improbable that Chinese concern volition go similar the 1 India has with Russia oregon U.S.," Bhandari said.  

India enjoys a goods commercialized surplus with the U.S, lasting astatine $45.8 cardinal arsenic of 2024. On the different hand, it has a widening shortage with China, thing it has been trying to curb but has been incapable to do. India's commercialized shortage with China was $99.2 cardinal for the twelvemonth ended March 2025, up from astir $85 cardinal the twelvemonth before, with full imports from Beijing touching an all-time precocious of $113.45 billion.

"Our commercialized shortage concerns are 2 pronged. One is the existent size of the deficit. Two is the information that the imbalance has continuously been widening twelvemonth aft year," according to the Indian embassy successful China. "We proceed to prosecute the Chinese broadside for addressing marketplace entree issues."

China's adjacent narration with Pakistan is different sore constituent for India. According to a report of Stockholm International Peace Research Institute, China delivered large arms to 44 states successful 2020–24, with astir two-thirds of its arms exports, oregon 63%, going to Pakistan. China supplied 81% of Pakistan's arms imports from 2020 to 2024, compared with 74% betwixt 2015 and 2019, the study said.

The SCO gathering is improbable to resoluteness disputes oregon heal aged wounds betwixt the 2 neighbors, according to experts. But Modi's beingness successful Tianjin could beryllium a awesome of willingness to find communal ground.

New Delhi has sought to presumption itself arsenic a manufacturing hub for planetary companies seeking to diversify proviso chains distant from China.

India, for instance, surpassed China arsenic the apical smartphone supplier to the U.S successful the 2nd quarter, portion China's stock of smartphone exports to the U.S. dropped to conscionable 25% from 61% a twelvemonth earlier, according to probe steadfast Canalys.

Still, the state has not been capable to afloat capitalize connected the "China Plus One" accidental partially owed to commercialized barriers betwixt New Delhi and Beijing, said Priyanka Kishore, main economist at Asian system and policy-focused deliberation vessel Asia Decoded.

"Countries aspiring to beryllium China+1 destinations request to get their earthy materials oregon intermediate goods from China until the clip they tin make their ain capabilities astatine home. Domestically India is not successful presumption to nutrient and supply each intermediate goods and earthy materials," she said.

Several industries successful India are highly reliant connected China.

"For mean chemical-based APIs (active pharmaceutical ingredients), China supplies 70% of India's requirements portion for biosimilar APIs it supplies astir 90%," said Ajay Srivastava caput of the Global Trade Research Initiative, adding that China is India's cardinal supplier of electronics, electricals, machinery and integrated chemicals.

Electrical vehicles is different manufacture wherever India is highly reliant connected Chinese supplies.

With a extremity to curtail their crude import bill, the Indian authorities has acceptable ambitious targets for adoption of electrical vehicles. It aims EVs to relationship for 30% of caller conveyance income by 2030, up from 7.6% successful 2024, according to information from the Indian authorities argumentation deliberation vessel Niti Aayog.

That's a gangly inquire fixed astir Indian EV manufacturers trust connected China for proviso of cardinal elements specified arsenic uncommon world magnets. "Our authorities has pushed the car manufacture successful a presumption wherever it relies connected China for cardinal components similar uncommon world magnets, lithium, cobalt ... So fundamentally a cardinal manufacturing manufacture is susceptible to disruption," Bhandari said.

Last week, during his sojourn to India, the Chinese overseas curate assured that his state volition code the India's request for uncommon earths, passageway boring machines and fertilizers.

China besides stands to summation from strengthening commercialized ties with its neighbor. India has banned respective Chinese businesses from operating successful the country. The prohibition has affected a divers scope of firms from e-commerce companies specified arsenic Shein to societal media level TikTok.

Access to the Indian marketplace tin beryllium a large boost for Chinese companies astatine a clip erstwhile there's a slowdown successful home consumption. India's EV market, for instance, offers country for Chinese companies to turn arsenic they look aggravated contention astatine home.

"BYD would emotion to unfastened a mill successful India, present that Vietnam's VinFast has already been allowed. Chinese industries are dealing with overproduction and excess capableness and with the request from US marketplace shrinking they request different markets," said Kishore.

In further motion of warming ties, pursuing Wang's visit, nonstop flights from India to mainland China, which had been suspended since the commencement of the Covid-19 pandemic successful 2020, are acceptable to resume. Both sides person agreed to reopen borderline commercialized astatine 3 designated trading points.

Indian companies specified arsenic Reliance Industries and Adani Group are besides pursuing partnerships with Chinese companies, The Economic Times reported successful July.

While the signs are positive, long-held suspicions and borderline disputes marque it hard to spot the 2 countries arsenic adjacent partners. The SCO gathering volition connection greater clarity connected however in-step volition the elephant and dragon's tango volition beryllium — and for however long.