Trump–Xi Truce in Busan Could Reshape Asia’s Power Balance

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In India Narrative, former envoy Sanjay Kumar Verma writes that the Trump–Xi meeting at the APEC Summit signals a pause in U.S.–China rivalry with far-reaching implications for India’s trade, strategy, and autonomy.

By TRH Foreign Affairs Desk

New Delhi, October 31, 2025 — The closely watched meeting between US President Donald Trump and Chinese President Xi Jinping on the sidelines of the APEC Summit in Busan could mark a pivotal shift in Asia’s balance of power, writes Sanjay Kumar Verma, India’s former ambassador, in India Narrative.

Verma notes that while the encounter looked like another diplomatic photo-op, “beneath the choreography lies the possibility of reshaping Asia’s balance of power.” For India, he argues, this is not a distant spectacle but a development that could shape its trade, technology, and security equations for years.

According to Verma, the Busan meeting produced a “framework understanding”—a structured truce rather than a formal agreement—covering limited cooperation on economic and law enforcement issues. China is expected to resume partial purchases of US agricultural products, while Washington will defer certain tariffs. The two sides also agreed to work together on fentanyl precursor control and export issues.

Verma writes that this limited thaw suggests “US–China rivalry may enter a phase of controlled friction rather than outright confrontation,” with direct consequences for India’s strategic space.

He observes that domestic challenges on both sides—economic pressures in the US and slowing growth in China—have prompted the two leaders to seek temporary stability. “Both need breathing space,” Verma notes, adding that even a modest easing of tensions could recalibrate global alignments and test India’s foreign policy flexibility.

Economically, he warns that a US–China truce could reduce the urgency for manufacturers to shift supply chains from China, slowing India’s manufacturing momentum. New Delhi, he says, must now “rely less on geopolitical tailwinds and more on structural reforms.”

Strategically, Verma cautions that if Washington and Beijing move toward accommodation, India’s perceived value as a counterweight could diminish. He urges New Delhi to sustain its partnerships “as a partner of convergence, not dependence.”

“The Trump–Xi meeting neither erased rivalry nor secured peace,” Verma argued, adding: “For India, steadiness amid flux is key—like the banyan tree that bends but does not break.”

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