US-China Tariff truce narrows India's edge in Global Supply Chains: GTRI

The United States and China have agreed to a 90-day trade truce beginning 14 May 2025, drastically cutting tariffs on most traded goods.

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The US will slash its tariffs on Chinese imports from 145 per cent to 30 per cent, while China will reduce duties on US products from 125 per cent to 10 per cent. This recalibration, however temporary, could have lasting effects on countries like India, which had recently emerged as a beneficiary of strained US-China trade relations.

According to a detailed analysis published by the Global Trade Research Initiative (GTRI), this truce is not a strategic breakthrough but rather a tactical rollback under economic pressure. The report, titled The US-China Tariff Deal: No Fix for Deficit, No Boost for Manufacturing, argues that while the agreement reopens the USD 660 billion trade pipeline between the world's two largest economies and relieves some pressure on global supply chains, it significantly narrows India's trade advantage.