US President Donald Trump has a long history of attacking China over its trade policies, though often seen to be wavering and inconsistent in his approach towards the Asian country seen as American primary economic rival. In 2018, during his first tenure, President Trump imposed tariffs of up to 25 percent on a range of Chinese goods under Section 301 of the Trade Act of 1974.

During the US presidential campaign of 2024, Trump promised up to 60 percent tariffs on Chinese imports and maintained this tempo even as president-elect.

In his inaugural speech of 20 January 2025, US President Donald Trump did not explicitly attack China but indirectly critiqued it, reaffirming his America First policy, referring to apparent Chinese control over the Panama Canal, and promising stronger trade policies, energy independence and military strength.

Following up on his promise, President Trump announced 25 percent across-the-board tariffs on Mexico and Canada and an additional 10 percent to existing tariffs on imports from China on 1 February 2025.

While Trump’s actions were justified as inevitable steps for restoration of US global economic dominance, the magnitude of protectionism ingrained in Trump’s policies and how they are likely to manifest could eventually work to China’s benefit.

Here is how this could happen.

Economic impact and trade wars

The previous Trump administration deployed tariffs to reduce trade deficits and protect domestic jobs in the US. If this approach continues in his second administration, both the US and China may face economic disruptions in the near term.

These include interruptions in trade, supply shortages, and rising costs in the US, alongside reduced exports and slower growth in China. The long-term success of these strategies will depend on the ability of the US to transition to self-reliant production without triggering inflation.

Meanwhile, American actions will certainly invite a response from China and escalate the trade war between the two economic giants.

China will seek to deepen economic partnerships worldwide, strengthening initiatives like the Belt and Road Initiative (BRI) and expanding trade ties across Asia, Africa, Latin America and Europe. It is worthwhile to note that China’s exports to the Global South surpassed its exports to the developed world in 2021 with similar trends evident in its imports as well. China has already accelerated its push for self-sufficiency in critical sectors away from the West.

These trends could alter the global economic balance.

As a spontaneous response, China has announced countermeasures against the US, which include the imposition of retaliatory tariffs on select American imports and launching an antitrust investigation into Google. Accordingly, Beijing will implement a 15 per cent tariff on coal and liquefied natural gas (LNG), along with a 10 per cent tariff on crude oil, agricultural machinery, and large-engine cars imported from the US.

These tariffs reportedly took effect from 10 February.

Suffice it to be pointed out that like in the case of Mexico and Canada when President Trump withheld the announced tariffs for a month after retaliatory tariffs announced by the former two, the US President also indicated that a new trade deal is possible with China as well.

Recent reports suggest that US exports of liquefied natural gas (LNG) and crude oil are being redirected to Europe and India due to the newly imposed tariffs by China. The most significant shift is in coal exports. US coking coal shipments to China had risen by 33 percent in 2024. However, the tariffs are now pushing China to source more coal from Mongolia and Australia. While US crude oil accounts for only 2 percent of China’s total crude oil imports, the impact of the tariffs are expected to be more on the coal trade.

As a matter of fact, protectionist policies in the US have not just backfired but also encouraged certain countries to look to other trade partnerships and work toward greater self-sufficiency.  

China’s technological ambitions

The other major countervailing factor that could work in China’s favour is technology.

China's rise as a global power is deeply rooted in both its historical view of itself as a global power and the existential drive of its ruling Communist Party. This ideological perspective fuels its relentless pursuit of scientific progress, manufacturing superiority, and global influence. With advancements in Artificial Intelligence (AI), quantum computing, 6G telecommunications, and industrial automation, China is positioning itself as a self-reliant technology powerhouse.

China already had a technology advancement policy in the form of its ‘Made in China 2025’ strategy launched in 2015. The Communist regime could be expected to further ramp up such policies in response to US trade restrictions, particularly in cutting-edge sectors like semiconductors, AI, and renewable energy.

Trade restrictions on China could also support Beijing's initiatives to strengthen financial alternatives like the BRICS bloc and non-dollar trade agreements, increase the use of the Yuan globally, and lessen reliance on the US dollar as an international currency.

Thus, attempts to isolate China could, paradoxically, accelerate its rise as a global economic and technological leader.

The launch of China’s Deepseek Large Language Model late last month at a significantly lower cost and with the computing power of comparable models in the US despite years-long American restrictions on the export of advanced semiconductor chips to China is a case in point. While the West has traditionally held an edge in cutting-edge technology, including domains like AI, China’s rapid strides in AI research, semiconductor development, and computing power indicate a shifting balance.

This aligns with its broader strategy of reducing dependence on Western technology while making the world increasingly reliant on Chinese innovations. Deepseek has, for instance, allowed its code to be freely available reflecting a broader Chinese push to make its standards and benchmarks global ones.

If these trends continue, China’s ability to control and shape global technological ecosystems will not only challenge US dominance but also reinforce its philosophy of being the central force in global progress.

The West versus China: Contrasting approaches to technology

Unlike many Western nations, China prioritises accessibility over exclusivity in technological progress. While Western corporations have often leveraged technology as a geopolitical tool, enforcing intellectual property laws and maximising profits, China has focused on mass production, cost efficiency, and supply chain mastery.

This approach has allowed even cutting-edge innovations to be scaled affordably, ensuring broader accessibility.

From high-speed rail to digital payment systems, China has systematically expanded the accessibility of technology, integrating advancements into daily life domestically and internationally. This has allowed China to dominate sectors like electric vehicles, mobile technology, and fintech.

In contrast, Western tech giants, constrained by corporate interests and regulatory hurdles, have often priced innovations out of reach for many developing economies. While the US enforces technological barriers, China continues to expand its alternative ecosystem, making its innovations more attractive to nations seeking affordable, scalable solutions.

No wonder then that the Western world sees advancements made by China as ‘digital,’ ‘tech-enhanced’ and ‘data-centric’ authoritarianism. 

Geopolitical realignments and American strategic missteps 

By attempting to monopolise technological progress through sanctions and restrictive trade policies, Washington assumes that global leadership hinges solely on American advancements. This assumption is mistaken, however, and as the US withdraws into protectionist policies, China will see a chance to establish itself as a more reliable economic ally for the Global South. 

Washington’s shift towards insularity, meanwhile, alongside such policies as exiting global organisations, reducing foreign aid and enforcing trade restrictions diminishes both trust with its partners and its own position. 

Trump’s immigration policies threaten to undermine an important pillar of the US economy. Immigrants have traditionally been vital in key areas such as technology, healthcare, construction, and agriculture.

Restrictive visa rules and extensive deportations are likely to exacerbate labour and skill shortages in the US, and force businesses to relocate their operations internationally. Ironically then, while Trump champions economic nationalism, his policies could weaken the very industries that sustain US competitiveness.

From unilateralism to inclusion: the path forward for the US

American leaders must understand that the era of unilateralism has passed. The globe no longer operates at the will of a single hegemonic superpower; rather, contemporary geopolitics is increasingly moulded by minilateralism – a realm where a small group of countries collaborate and create vibrant, adaptable partnerships founded on mutual interests.

Whether trade, technology, or security, no nation, including the US, can afford to function in isolation without repercussions.

America has historically been a symbol of opportunity, a nation where individuals from diverse backgrounds have sought to create a brighter future. In seeking to contain China and to Make America Great Again, US policies either inadvertently or deliberately reflect the zero-sum approach the Chinese have long adopted.

Given the differences in their political systems and ideologies, however, such approaches have a larger cost for the US than they have for China. An America that shuts its doors – to global trade, cooperation, or immigration – endangers not just its own international reputation but also undermines the core principles upon which it was established and on which its soft power and global influence are based.

The real challenge for the US, hence, is not merely about outperforming China but demonstrating that it can do so not by exclusion, but by taking everyone along. Instead of outright and explicit confrontation with China, staying the course with a more balanced policy of strategic competition and engagement may yield better long-term results.

Else, the US risks hastening its own decline as a global power.

India in a hedging role

India’s relationship with the United States of America holds significant importance in this context, especially in the backdrop of how the Trump administration is going to adapt to the current world order.

Prime Minister Narendra Modi’s recent visit to the White House had a transactional agenda, reflecting the evolving dynamics between the two nations. India’s approach to American foreign policy has traditionally been guided by several key drivers such as the defence relationship and India’s role as a counterbalance to China.

At the same time, the significant geopolitical shifts that Trump had initiated – be it in East-West relations or the conflict zones – have the potential to influence and shape India’s own strategic positioning as it navigates its relationships with major global powers. Accordingly, how India plays its hedging strategies vis-à-vis China – from current estrangement to some form of strategic engagement – will be significantly dependent on Trump’s policies.

In other words, any American policy that could affect India’s strategic interests will affect its counterbalancing role, in ways that could be of advantage to Beijing. In fact, the New Delhi-Beijing dialogue has already been initiated in this direction with Chinese President Xi Jinping meeting Prime Minister Modi in late 2024 and taking steps to resolve the border imbroglio, which, clearly was in anticipation of a Donald Trump victory.

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