India's Modi to visit China for first time in 7 years as tensions with US rise
Modi will go to China for a summit of the multilateral Shanghai Cooperation Organisation that begins on Aug. 31, the government source, with direct knowledge of the matter, told Reuters. India's foreign ministry did not immediately respond to a request for comment.
His trip will come at a time when India's relationship with the U.S. faces its most serious crisis in years after President Donald Trump imposed the highest tariffs among Asian peers on goods imported from India, and has threatened an unspecified further penalty for New Delhi's purchases of Russian oil.
Modi's visit to the Chinese city of Tianjin for the summit of the SCO, a Eurasian political and security grouping that includes Russia, will be his first since June 2018. Subsequently, Sino-Indian ties deteriorated sharply after a military clash along their disputed Himalayan border in 2020.
Modi and Chinese President Xi Jinping held talks on the sidelines of a BRICS summit in Russia in October that led to a thaw. The giant Asian neighbours are now slowly defusing tensions that have hampered business relations and travel between the two countries.
India braces for hit to $64bn US exports amid rising tensions with Washington
Trump has threatened to charge an additional 10% tariff on imports from members - which include India - of the BRICS group of major emerging economies for 'aligning themselves with Anti-American policies.'
Trump said on Wednesday his administration would decide on the penalty for buying Russian oil after the outcome of U.S. efforts to seek a last-minute breakthrough that would bring about a ceasefire in the war in Ukraine.
Trump's top diplomatic envoy Steve Witkoff is in Moscow, two days before the expiry of a deadline the president set for Russia to agree to peace in Ukraine or face new sanctions.
Meanwhile, India's National Security Adviser Ajit Doval is in Russia on a scheduled visit and is expected to discuss India's purchases of Russian oil in the wake of Trump's pressure on India to stop buying Russian crude, according to another government source, who also did not want to be named.
Doval is likely to address India's defence cooperation with Russia, including obtaining faster access to pending exports to India of Moscow's S400 air defence system, and a possible visit by President Vladimir Putin to India.
Doval's trip will be followed by Foreign Minister Subrahmanyam Jaishankar in the weeks to come.
India, China agree to expedite resumption of direct flights as ties improve
Export impact
U.S. and Indian officials told Reuters a mix of political misjudgement, missed signals and bitterness scuttled trade deal negotiations between the world's biggest and fifth-largest economies, whose bilateral trade is worth over $190 billion.
India expects Trump's crackdown could cost it a competitive advantage in about $64 billion worth of goods sent to the U.S. that account for 80% of its total exports, four separate sources told Reuters, citing an internal government assessment.
However, the relatively low share of exports in India's $4 trillion economy is expected to limit the direct impact on economic growth.
On Wednesday, the Reserve Bank of India left its GDP growth forecast for the current April-March financial year unchanged at6.5% and held rates steady despite the tariff uncertainties.
India's government assessment report has assumed a 10% penalty for buying Russian oil, which would take the total U.S. tariff to 35%, the sources said.
India's trade ministry did not immediately respond to a request for comment.
The internal assessment report is the government's initial estimate and will change as the quantum of tariffs imposed by Trump becomes clear, all four sources said.
India exported goods estimated at around $81 billion in 2024 to the U.S.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Business Recorder
44 minutes ago
- Business Recorder
Pakistan Refinery to buy its first Nigerian Bonny Light oil from Vitol, sources say
KARACHI: Pakistan Refinery Limited will import its first cargo of Nigerian Bonny Light crude from Vitol in September, two sources familiar with the matter said, as Asian refiners shift towards cheaper alternatives to Middle Eastern oil. The 500,000-barrel, light-sweet crude cargo is expected to load later this month and arrive in Karachi by late September, the sources said, declining to be named as the information is not yet public. The price was not immediately known. Vitol and PRL did not immediately respond to a request for comment. The purchase follows Pakistan's first deal to import U.S. crude, also supplied by Vitol, by Cnergyico, which is scheduled to arrive in October. Almost all of Pakistan's crude imports are sourced from the Middle East, primarily Saudi Arabia and the United Arab Emirates. However, along with other Asian refiners, Pakistan's industry has shown increased interest in recent months in supplies from elsewhere, including U.S. West Texas Intermediate and Kazakh CPC Blend, after Middle Eastern supplies became more expensive. As early as 2014, Pakistan imported a Nigerian Yoho crude, according to data from Kpler, but the Bonny Light purchase is the country's first known purchase of Bonny Light, which is valued for its high yields of gasoline and diesel. Oil is Pakistan's largest import item, with crude and petroleum products of $11.3 billion in the fiscal year ended June 30, 2025 representing nearly a fifth of the country's total import bill.
Business Recorder
2 hours ago
- Business Recorder
Records tumble at PSX as buying rally continues
Buying momentum continued at the Pakistan Stock Exchange (PSX), fueled by a strong economic outlook and robust corporate earnings, with the benchmark KSE-100 Index settling at a new record high on Thursday. Positive sentiment prevailed for most of the trading session, driving the KSE-100 Index to an intra-day high of 146,081.02. At close, the benchmark index settled at 145,647.13, a new record high, following an increase of 558.64 points or 0.39%. On Wednesday, the PSX sustained its record-breaking rally as the benchmark KSE-100 Index soared by 2,051 points, or 1.43%, to settle at an all-time closing high of 145,088.50 points. In a Prime Minister's Office statement, PM Shehbaz Sharif expressed satisfaction as the stock exchange index surpassed the 145,000-point mark, signalling increased investor confidence in government policies. PM attributed the surge in stock market activity to business-friendly reforms and said providing support for investment remains a top priority for his administration. International markets Asian equities rose on Thursday, with Japanese shares hitting a record high, as tech-led gains on Wall Street, upbeat earnings and growing expectations for U.S. rate cuts boosted sentiment. The prospect of a meeting between U.S. President Donald Trump and Russian President Vladimir Putin over the war in Ukraine also underpinned sentiment, benefiting the euro, while weighing on oil prices as traders gauged the outlook for sanctions on Moscow. At the same time, markets largely shook off Trump's latest tariff threats, including an additional 25% tariff on India over purchases of Russian oil and a threatened 100% duty on chips. Japan's broad Topix index rose 0.9% to reach an all-time high, with the more tech-focused Nikkei also gaining by about the same margin. Taiwan's stock benchmark surged 2.3% to a more than one-year peak. South Korea's KOSPI added 0.6%. Hong Kong's Hang Seng rose 0.4%, and mainland Chinese blue chips advanced 0.3%.
Express Tribune
3 hours ago
- Express Tribune
India vows to protect farmers amid Trump's tariff threat
India's Prime Minister Narendra Modi speaks during a joint press statement with European Commission President Ursula von der Leyen at the Hyderabad House in New Delhi, India, February 28, 2025. Photo: Reuters Listen to article Indian Prime Minister Narendra Modi said on Thursday he will not compromise the interests of the country's farmers even if he has to pay a heavy price for it, in his first comments after US President Donald Trump's salvo of a 50% tariff on Indian goods. Trump announced an additional 25% tariff on South Asian nation on Thursday, taking the total levy on Indian goods being exported to the US to 50% among the highest levied on any US trading partner. "For us, our farmers' welfare is supreme," Modi said in a function in New Delhi. "India will never compromise on the wellbeing of its farmers, dairy (sector) and fishermen. And I know personally I will have to pay a heavy price for it," he said. Trade talks between India and the United States collapsed after five rounds of negotiations over disagreement on opening India's vast farm and dairy sectors and stopping Russian oil purchases. Modi did not directly refer to the US tariffs or trade talks. The new tariff, effective from Aug 28, was to penalise India for its purchase of Russian oil, Trump has said. India's foreign ministry has said the decision was "extremely unfortunate," and that "India will take all necessary steps to protect its national interests." The US is yet to announce any similar tariff for China, which is the biggest buyer of Russian oil. Read: India feels the pinch as Trump doubles tariffs Experts have said China has been spared so far as it has a bargaining chip with the US over its reserves of rare earth minerals and other such commodities, which India lacks. "The US tariff hike lacks logic," Dammu Ravi, secretary of economic relations in India's foreign ministry, told reporters. "So this is a temporary aberration, a temporary problem that the country will face, but in course of time, we are confident that the world will find solutions." India has started making moves to signal that it might have to consider other partnerships in the coming months in the face of Trump's tariffs, which have led to the worst diplomatic showdown between the two countries in years. Indian Prime Minister Narendra Modi is preparing for his first visit to China in over seven years, suggesting a potential realignment in alliances as relations with Washington fray. Brazilian President Luiz Inacio Lula da Silva said on Wednesday he would initiate a conversation among the BRICS group of developing nations about how to tackle Trump's tariffs. He said he planned to call Modi on Thursday, and China's Xi Jinping and other leaders. The BRICS group also includes Russia and South Africa. Ravi said "like-minded countries will look for cooperation and economic engagement that will be mutually beneficial to all sides."
