US-China Deal: On Monday, China and the US issued a joint statement stating that they have reached an agreement, understanding the importance of their bilateral economic and trade relations for the global economy. Let us understand from the experts’ perspective what this news means for the world market.
On Monday, China and the US issued a joint statement saying that the two countries have reached a tariff agreement given the importance of their bilateral economic and trade relations to the global economy. The US and China have agreed that they will withdraw their previously announced mutual tariffs and retaliatory tariffs for 90 days. Meanwhile, China will impose a 10 percent tariff on US goods and the US will impose about 30 percent tax on Chinese goods.
According to market experts, this announcement is good for the disruptions in global trade that were happening due to tariffs. It will also have an impact on India because China will once again be able to trade its goods in America and this will get rid of the problem of dumping in India. With this, Indian markets will continue to move forward in their own way.
What is the opinion of experts on the reconciliation between America and China?
Indian market will get a solution to dumping
Senior market expert Kishore Ostwal says that the agreement reached between America and China is good news for world trade. This announcement is good for the disruptions in global trade that were happening due to tariffs. It will also have an impact on India because China will once again be able to trade its goods in America and there will be no problem of dumping in India. Even after the reduction in tariffs, the Indian market is showing growth. The Indian market is very important for America and it gives priority to India. Therefore, the Indian market will continue to move forward in its own way.
Indian economy has shown resilience
Devarsh Vakil, Head of Price Research, HDFC Securities, says that after the mutual tariff announcement between the two countries, the losses incurred in the markets are likely to be recovered. Signs of easing of US-China trade tensions have reduced investor panic. India’s markets and economy have already shown resilience, which remained stable after continuous external turmoil. There are signs of good business at the global and domestic level in the future.
This agreement is positive for the market
Anita Rangan, economist at Iquirus Securities, says that the trade agreement between the US and China is overall positive to reduce the level of uncertainty on tariff-trade disagreements from April 2, 2025. However, China is the world’s largest exporter, so the world will benefit manifold from this agreement.
Reconciliation will play an important role in controlling inflation
The first benefit is that the speculation of rapid increase in inflation has now ended. Although more tariffs than before can cause inflation, but at the moment it is at a manageable level. The second benefit is the reduced fear of recession in America. This will have a positive effect for India because America depends largely on India’s services and it should not be forgotten that America is also India’s largest trading partner.
The way forward will be easier for India
The third important benefit from the reconciliation between America and China is that the way forward for India will be easier. India can expect positive and beneficial trade growth. Rangan says, overall inflation is under control and US growth is largely intact. The path for the Fed may become clear after some policies. The Fed can resume its rate cut cycle anytime in the third or fourth quarter of 2025. This development should be positive for India as it can remove export uncertainties to some extent. Most importantly, the return of capital flows should be positive as India can fully leverage the trade with significant FDI investments in semiconductors, IT hardware, auto and auto parts and other related sectors where India can also reap some other trade benefits with China+1.
