On August 7, the Veza Public Analytics Center hosted a discussion with Valerii Klochuk and Illia Neshchodovsky on the economic and political consequences of potential new US tariffs against India and China. The main topic was the impact of Donald Trump’s announced restrictions on Chinese goods and economic pressure through India’s oil deals with Russia.
Neshchodovsky noted that Trump previously secured concessions in trade talks with Japan and the European Union, and now focuses on India, using its oil trade with Russia as leverage. India, he stressed, profits substantially from refining and exporting Russian oil, including to US and EU markets. While losing these markets would be painful for India, it could technically reorient its refineries if Western countries refuse to buy its oil products.
Regarding China, experts emphasized that further tariffs are largely political, as the current level has already significantly limited trade. China, however, can bypass such restrictions through third countries and possesses leverage over the US, notably with rare earth metals.
The possibility of an alliance between India and China and the strengthening of BRICS was also discussed. However, the experts view the bloc’s transformation into a true alternative to Western coalitions as unlikely due to divergent member interests.
In summary, experts concluded that US tariff pressure on India and China is primarily a bargaining tool rather than an effective means for radical shifts in the global balance of power. India, for now, lacks motivation to abandon Russian oil unless there is a noticeable drop in Western demand for its products.
For more, watch the full analytical discussion on the Veza channel.
