India and China have signalled a tentative thaw in their often fraught relationship, as Prime Minister Narendra Modi and President Xi Jinping met in Tianjin on the sidelines of the Shanghai Cooperation Organisation (SCO) summit on August 31, the BBC reports.

It is Modi’s first visit to China in seven years, a period marked by deadlock along the Himalayan frontier, military clashes in Ladakh’s Galwan Valley and a sharp decline in trade and travel. The two leaders now say the atmosphere has shifted, with Xi describing India as a partner rather than a rival and Modi speaking of “peace and stability”.

Tariffs driving change

The renewed warmth comes at a time of mounting economic headwinds. Washington has imposed steep tariffs on Indian exports, including diamonds and prawns, raising duties to 50% according to the BBC. President Donald Trump has framed the move as retaliation for Delhi’s continued purchase of Russian oil and in knock-on effect backing Moscow’s moves against Ukraine.

The levies strike at the heart of India’s export-driven growth and coincide with similar tariff pressure on Beijing. China, still reeling from sluggish post-pandemic recovery, faces what the Chinese president himself has described as “sky-high” trade barriers from the United States.

For both Asian giants, a rapprochement offers a way to offset American pressure and stabilise their economies. Analysts note that while Washington has long hoped to see India act as a counterweight to Beijing, Delhi’s frustrations with its Western partners have created an opening for a pragmatic realignment.

Idealistic symbolism

The SCO summit itself carries limited practical weight but has grown in symbolic significance. Created in 2001 by China, Russia and four Central Asian states, the body was designed as a counterbalance to Western alliances. This year’s gathering – the largest in its history – brings together leaders from ten member states, including Russia, Pakistan and Iran, with sixteen dialogue partners and observers.

In Tianjin, the city has been turned into a stage for diplomacy, with banners, billboards and evening lightshows along the river. Road closures and restrictions on taxis have not deterred crowds, who have gathered in their tens of thousands to watch what state media is calling a “historic meeting” the BBC adds.

President Vladimir Putin’s own presence has further highlighted the summit’s geopolitical undertones. Facing sanctions over the war in Ukraine, Putin remains closely aligned with Beijing. For Modi too, his own attendance signals India’s willingness to play a more visible role in non-Western platforms at a time of uncertainty in relations with Washington, and crucially may be an indicator of India taking sides – something New Delhi rarely does.

Beyond the handshake

Announcements from the summit include the resumption of direct flights between India and China, suspended since 2020 following border clashes. Officials have also hinted at visa relaxations and fresh trade initiatives but these have already been reported in recent weeks.

As such, although unlikely to deliver immediate breakthroughs, the moves suggest a willingness to explore what each other has to offer, potentially at the expense of relations to the US.

Yet the obstacles are considerable. Border demarcation remains unresolved, with Galwan a lingering flashpoint. Other points of friction include Tibet, the Dalai Lama, and China’s planned hydroelectric mega-project across a river shared with India. Delhi has also banned over 200 Chinese apps, including TikTok, as part of its response to past hostilities.

India’s regional stance further complicates matters.

Relations with Pakistan remain volatile after recent attacks by Islamabad in Kashmir, while Beijing retains strong economic ties across South Asia, from Sri Lanka to Bangladesh. Many observers caution that despite the conciliatory rhetoric, deep mistrust endures.

Shifting global order

What is clear, however, is that both countries see value in projecting a united front at this moment in time. India’s economy, worth more than $4 trillionn and forecast to grow at over 6%, is set to become the world’s third largest by 2028, according to the International Monetary Fund.

China for now remains the second largest, though its expansion has slowed. Together, Beijing and New Delhi account for more than a third of the world’s population and a rising share of global output. As such, for months, experts have argued that the world should pay more attention to this pairing, rather than focusing solely on US-China or US-India dynamics. Others remain sceptical, describing the Delhi-Beijing axis as “an uncomfortable alliance at best”.

For Modi, at least for now, the shift feeds into his narrative of a multipolar order, and one where India is not forced into binary choices between Washington and Beijing. For Xi, the embrace of his neighbour offers proof of solidarity within the Global South at a time of pressure from Washington.

What happens next will be watched closely far beyond Asia.