US President Donald Trump’s gift for showmanship was on full display when Chinese President Xi Jinping arrived at the White House on September 23 for a three-day ceremonial visit. There was ceremony and spectacle, and a new phrase, a “constructive relationship of strategic stability”, was floated. The two leaders had already met this year, when Trump travelled to China in May, and they will meet twice more before the year is out, at the Asia-Pacific Economic Corporation (Apec) in Shenzhen and the G20 in Miami. 

Beneath the pomp and circumstance, the actual agreements were few. The trade ceasefire agreed at Busan last year was extended until January 10. A new Board of Trade will aim to reduce tariffs on $30 billion worth of goods from each country. On rare earths, the two sides promised only to “continue to work”. On Taiwan and export controls, no progress was made.

As usual, there were those who saw in the Trump–Xi bonhomie, the beginnings of a G2: an understanding to run the world jointly, a condominium of sorts. Would the United States (US) and China divide Asia between themselves, and what would that mean for India? India has worked hard over the last 20 years to cultivate its relationship with the US and sees itself as being treated almost as an antagonist, hit with tariffs, while its bitterest adversary, Pakistan, has been embraced by the White House.

The Asia game

These concerns are understandable, but they are not what India should be worried about. A G2 is a chimera, a mirage, and it is unlikely to happen. What India needs to fear is the US striking incremental deals with China: small deals, each justifiable on its own, that together chip away at the interests of America’s partners, India among them.

The concept of a G2 was popularised during the 2008–09 financial crisis, when C Fred Bergsten and Zbigniew Brzezinski argued that the two countries should work together to lead the world economy. It has had a resurgence this autumn. But many of those who understand China are not convinced. At a recent interaction with former Australian prime minister Kevin Rudd, who knows Beijing better than most, I found him just as sceptical as I am. He has also argued against the idea in print.

Writing in The Hindu this month, he called the “breathless reporting about an emerging ‘G2’” “fanciful”, said that China’s talk of managing “strategic differences” is “code language for Taiwan”, and concluded that “strategic competition is not going away.”

Rudd is correct, and there are structural reasons why. Finding agreement on certain issues is different from trying to control a region jointly. For the US and China to run Asia together, they would need similar goals. Each would need to compromise its aspirations and agree upon spheres of influence. They would also require sufficient legitimacy: other countries’ willingness to follow. None of these conditions exists. China wants to reshape many aspects of the current order in Asia, while the US, under Trump or not, still wants to protect the status quo. Taiwan remains volatile. The race to dominate technology has morphed into a contest over national security.

Asia also is not a blank canvas waiting for the US and China to colour in. Japan is technologically advanced. India has mass nuclear weapons and a long record of acting independently. Others, such as Australia, South Korea, Indonesia and Vietnam, have their own interests to protect. And the harder the US and China compete for dominance over

each other, the weaker their capacity to lead together.

The summit proved this. Xi asked Trump to “oppose” Taiwanese independence; he got no such commitment. Export controls stayed off the table. The two sides could not even agree on whether they had discussed a memorandum on military crisis communication. Plenty of glitz, then, and very little real bargaining.

There are many lessons India can take from the recent summit about how to read American foreign policy.  Diplomacy needs room to pivot. But there is a difference between pivoting in the short term and having no long-term goal. Trump has threatened tariffs on US’ closest allies one day and courted its adversaries the next. He has gone from calling  China the US’ biggest threat to calling Xi a great man and a friend in quick succession. Ceasefires are renewed every few months. A Board of Trade covers only a fraction of US–China trade. There is a dialogue on artificial intelligence that the two sides cannot even agree on a name for. These may keep a rivalry in check. They will not create an order.

Transactional drift has consequences for US’ allies. They cannot plan their industrial policy or build up their defences if the US president may wake up one morning wanting to befriend their adversary. There may be some merit in keeping a rival on its toes. But if the US alienates its allies faster than it frightens its rivals, it does itself more harm than good, and trust is something it cannot afford to squander. Japan and Australia host American forces on their soil, and their defence planning rests on the US. Unlike India, they have little room to hedge. 

Taiwan stands out. In May, Trump called the pending $14 billion arms package for Taipei “a very good negotiating chip”. Months later, it has still not been cleared. No deal over Taiwan has been struck, and none needs to be. A commitment that has been put on the table once can be put there again.

India’s options

Another lesson is knowing who can hurt the US and who cannot. Most of the world’s critical minerals and rare earths are processed in China. So when China cuts off supplies, the US negotiates. India, by contrast, was hit last year with a 25 per cent penalty tariff for buying Russian oil, after two decades of growing alignment with the US. The penalty was lifted in February, but the Graham Act, which Trump signed in September (while India has been given a waiver for the present), gives him the power to impose duties of up to 100 per cent on countries that keep buying Russian oil.

India should not try to pit China against the US. But it should recognise that, in dealing with Trump, the ability to hurt the US earns more than the patient work of building a relationship.

The US did not become the leading world power after 1945 only because it was powerful. It built an order that others wanted to be part of. What it is heading towards now is worse than isolationism: a country so powerful that fewer and fewer want to be associated with it. 

Be patient. Do not assume that every conversation between the US and China means India is losing out. India does not want a US–China war, so some cooperation between them is in its interest, as long as India’s interests are kept in mind.

Build ourselves up. Everyone in India is talking about strategic autonomy at the moment. But if we cannot provide for ourselves, how can we be autonomous? We depend on Chinese inputs for our electronics, pharmaceuticals and even defence manufacturing. It is embarrassing, but we must face it, and we must become self-reliant in these fields.  India has sizeable rare earth reserves, yet we cannot use them to our benefit. We need to master the semiconductor space if we want to be self-reliant. Minerals, industry and defence research must be treated as national security issues. If you cannot make what you need, how are you strategically autonomous? By tweeting about it?

Build a relationship with the US, not one person. There are many benefits to our partnership with the US industry, from Indo-Pacific security to technology and defence. Build that relationship with the country, not one man. We need relationships with congressmen, generals and corporate leaders in the US. The more people we build relationships with, the less power one person can have over us. Expect less from one president and more from the US. 

Diversify. Build our relationship with Japan and Australia. These countries will be major players in our vision for Asia. Build our relationship with Europe. We concluded a free trade agreement with the European Union this January. It should be viewed as a strategic partner, not just a trading one. Look to Southeast Asia. Have the Quad achieve meaningful goals like maritime security, minerals and emerging technology. It doesn’t have to be the Asian version of North Atlantic Treaty Organization, but it should do something.

Lastly, we need to have our own policy towards China. We have a militarised border with China and our trade dependency on China keeps growing. We share some interests in reforming multilateral institutions.

 It would be prudent to maintain stability with the Chinese, if we negotiate from a position of strength, not necessity, and remember what happened in 2020. Kautilya was a great thinker when it came to foreign relations. He viewed all treaties as conditional on the strength of those who hold them. Indian strategic thinkers don’t need to be reminded of this. 

India should not hand its policy on China over to the US, nor should we find it easy to give in to China because the US has been unpredictable. Strategic autonomy is being able to decide for yourself. That doesn’t mean you have to see the US and China equally.

If the world splits into a US-led sphere and a China-led sphere, it’s because we let it. It doesn’t matter what two heads of state want. What will matter is whether a multipolar world can exist without hardening into rival blocs. India can work with both without belonging to either. As a postcolonial nation, India has always prized its freedom of choice. So, we have every right to want a multipolar world. Non-alignment worked because it allowed India to make decisions that suited it best. But we must show that we have what it takes to make those decisions happen.

We need to learn from the Trump–Xi meeting. Countries can compete but work together when it comes to business. They can be connected and rivals at the same time. And there is nothing that can replace what is happening on the ground.

For India, the danger lies in a series of small deals between China and the US, each at the expense of someone else. Kautilya would have understood. In a world of small deals, the weak are often traded and the strong are mostly  consulted. India must be strong enough to be consulted.