Border Peace, Trade Wars: India at the Crossroads of a Shifting World Order
By Sanjeev Oak
India’s outreach to China, marked by Ajit Doval’s meeting with Wang Yi, comes at a time of growing U.S.–India tariff friction, raising questions about whether shifting alliances could redefine Asia’s power balance and the contours of a new world order.
National Security Adviser Ajit Doval’s meeting with Chinese Foreign Minister Wang Yi in Astana last week was officially framed around “stability” and “upward trajectory” in bilateral ties. But beneath the diplomatic courtesies, the timing is telling. As tariff tensions with Washington intensify, New Delhi appears to be recalibrating its place in a new multipolar world order.
“Border peace with China is being invoked just as tariff friction with the US reaches a new pitch. That coincidence is no accident.”
The US–India Trade Rumble
The Biden administration’s move to impose steep tariffs on steel, aluminium, and select Indian pharmaceutical exports is more than a trade skirmish—it signals friction within what was touted as one of the world’s most important partnerships. In 2024–25, India’s exports to the US stood at nearly $120 billion, making America India’s largest single trading partner. A 15–20% tariff hike on metals alone could shave off $3–4 billion annually from Indian exporters, hitting sectors already facing global slowdown.
Meanwhile, India’s digital and services economy—worth over $250 billion in IT exports—faces subtle regulatory pushback in Washington, particularly around data transfer and labour outsourcing. This economic unease casts a shadow over defence and strategic ties, where India has become a key pillar of the Indo-Pacific narrative.
China Re-enters the Frame
Against this backdrop, the symbolism of Doval praising “upward trends” in India–China ties cannot be understated. Bilateral trade with China hit $136 billion in 2024, with India’s deficit widening to over $100 billion. While New Delhi has aggressively pursued supply chain diversification, the reality is stark: Chinese electronics, solar components, and APIs (pharma raw materials) remain central to India’s industrial base.
“India cannot decouple from China overnight—border management and market dependencies force a pragmatic engagement.”
If border quietude is sustained, it offers India breathing space to manage its economy amid external turbulence.
Russia, the Third Axis
India’s discounted energy imports from Russia—crossing $46 billion in 2024—have already redrawn energy geopolitics. Despite Western sanctions, Russia is now India’s largest crude supplier, accounting for over 35% of imports. This not only reduces input costs for Indian refiners but also deepens Moscow–New Delhi interdependence at a time when Washington is watching closely.
The creation of payment alternatives—such as rupee-dirham settlements routed through Dubai—signals a quiet de-dollarisation experiment. Add to this India’s participation in BRICS+ and SCO platforms, and a parallel architecture of trade and security is emerging.
The New World Order Question
What emerges is less about India choosing Beijing or Moscow over Washington, and more about strategic hedging. As tariffs pinch and Washington hardens its trade posture, New Delhi is signaling that it has other options.
“The unipolar moment is over. India’s message is clear: it will not be a camp follower in the US-China rivalry, but a power centre in its own right.”
This balancing act, however, comes with risks. A sustained tariff war could erode India’s export competitiveness. Simultaneously, an embrace of Russia and a tentative thaw with China could invite suspicion in Washington, complicating defence technology transfers and investment flows.
A Delicate Balancing Act
The path ahead will require deft statecraft. India’s aspiration to be a global manufacturing hub cannot materialise without access to US and European markets. Yet, its energy security and industrial resilience remain tethered to Russia and China.
In this tri-axial game, Doval’s words on “border peace” should be read not as platitudes, but as positioning. The world order is in flux, and India is carefully scripting its role—not as a junior partner, but as a pivotal node in a multipolar age.