Key Points

The report highlighted that while Japan and India may be able to negotiate better trade deals with the US than they might have been otherwise, they are not expected to agree to terms that would threaten their growing trade with China.

Jefferies said, "Japan and India may be able to negotiate better deals with the US than might otherwise have been the case, they are unlikely to agree terms that threaten their trading relationship with China".

The report also noted that China had recently issued a strong warning. It said that it would retaliate against any country that signs a trade deal with the US which harms China's interests. This shows China's tough stand as it deals with growing trade tensions with the US.

Meanwhile, the Trump administration seems focused on isolating China by strengthening trade relations with countries like Japan and India.

However, the report also highlighted that this strategy may not work as planned, since many countries now trade more with China than with the US.

It said "for many countries China is now a more important trade partner than the US".

In fact, China has become the most important trading partner for a large number of countries. According to IMF data, in 2024, 143 countries--around 71 per cent--traded more with China than with the US.

Even more striking, 107 countries--around 53 per cent--traded more than twice as much with China as they did with the US. In comparison, back in 2001 when China joined the World Trade Organization, these figures were just 22 per cent and 11 per cent, respectively.

This shift shows how China has grown into a global trade giant, making it harder for the US to isolate it through trade deals alone. However, India and Japan can get better deal in the ongoing trade tussle.

- ANI