India Should Engage Both US And China Without Taking Sides: GTRI

New Delhi, Apr 22 (KNN) Ajay Srivastava, Founder, Global Trade Research Initiative (GTRI), has called for India to strategically engage with both China and the United States while avoiding taking sides in the ongoing tariff war.

Srivastava emphasised that India should adhere to global trade principles rather than pursuing narrow personal interests.

A recent Chinese state media report warned that China would impose countermeasures in a ‘resolute and reciprocal manner’ against nations perceived as appeasing the US.

The report indicated that the Chinese government opposes any country making deals with the US that could undermine China's interests.

"India should not be drawn into binary geopolitical rivalries. Instead, it must engage with both China and the US on equal terms--guided by strategic autonomy, economic interest, and global trade principles--not by external pressure," Srivastava stated.

GTRI stressed that India must maintain an independent stance in this evolving landscape, which includes strengthening domestic manufacturing and reducing dependence on critical imports by investing in deep manufacturing capabilities.

The think tank also advised India to remain committed to the multilateral trade framework led by the World Trade Organisation (WTO) and avoid actions that might violate global trade rules.

India and the US are currently engaged in bilateral trade negotiations expected to conclude by fall 2025.

While the US has paused reciprocal tariffs on several countries, including India, those imposed on China remain in effect. For now, a baseline tariff of 10% will apply to US imports from most countries, including India.

GTRI urged policymakers to evaluate China's retaliatory position through the lens of global supply chain dynamics.

The think tank noted that the global economy remains highly dependent on China not only for finished products but also for intermediate goods and components essential to industrial production.

China maintains a central role across all tiers of the global supply chain—from final goods (Tier 1) to intermediate (Tier 2) and raw components (Tier 3).

While the ‘China+1’ strategy has helped some countries reduce dependence on Chinese-made finished goods, GTRI observed that completely replacing China would require massive investments across the entire manufacturing ecosystem—something no country has yet accomplished.

The think tank also criticised the US approach of using tariff negotiations to pressure trade partners into reducing ties with China, calling it disconnected from economic realities.

"Even the US hasn't been able to curb its imports from China. The last trade war only widened the US trade deficit," GTRI noted, warning that India should proceed cautiously while recognising the strategic opportunities the situation presents.

(KNN Bureau)