Donald Trump posted “The G2 will be convening shortly!” on Social ahead of his meeting with Chinese President Xi Jinping in South Korea. 

• U.S. President Donald Trump meets Chinese President Xi Jinping on the sidelines of the Asia-Pacific Economic Cooperation (APEC) summit, in Busan.

Key Takeaways From The Summit

• Trade Truce: US and China agreed to a one-year trade truce with US to cut tariffs from 57% to 47%, China to resume US soybean imports and delay new rare earth export curbs.
• Rare Earths & Strategic Materials: China delayed restrictions on 5 rare earth metals (key for defence and tech); It’s seen as a tactical concession but keeps leverage with 7 metals still restricted.
• Fentanyl Cooperation: China pledged stronger action against fentanyl precursor exports; US reciprocated by halving fentanyl-related tariffs.
• Technology and Semiconductors: Semiconductor access discussed, but no change on high-end AI chip (e.g., Nvidia Blackwell) export ban; Trump indicated future talks possible.
• Strategic Messaging & Outcomes: Both sides avoided Taiwan, agreed to cooperate on Ukraine; Xi said China “does not seek to replace any country,” signalling focus on stability over rivalry.

What is G2?

• Origin: Coined by economist Fred Bergsten (2005), who envisaged the US and China as a “Group of Two”, a geo-economic caucus to coordinate global economic recovery and stability.
• Purpose: Meant for cooperation on trade, climate, finance, and global governance, similar to G7/G20 but dominated by two powers.
• Evolution: 
  • The idea gained traction during the Trans-Atlantic Financial Crisis (TAFC) of 2008–09, also known as the Global Financial Crisis (GFC).
  • Consequences of TAFC: Shrinking of trans-Atlantic economies (US, UK, Germany, Italy, France) and a sharp rise in China’s share of global income and trade.
  • China’s response: Unleashed a massive fiscal stimulus, stabilized world trade, and bailed out the global economy, indirectly rescuing even the US and EU.
  • This marked China’s arrival as a systemic stabilizer, accelerating its rise and exposing the deep interdependence of the US and Chinese economies.
  • Though never institutionalized, the concept periodically resurfaced whenever global crises highlighted the centrality of the US–China axis.
• Current Revival (Trump–Xi 2025): Trump’s declaration  “THE G2 WILL BE CONVENING SHORTLY” marks a formal political revival of the idea, signaling acceptance of China as America’s equal and an intent to manage the world through a bipolar, sphere-of-influence framework.

Implications For India and The Region

• Strategic Realignment: The US–China “G2” elevates China as America’s equal, diluting India’s strategic value as a balancing partner.
• Erosion of Multipolarity: G2 implies a bipolar order which undermines India’s vision of a multipolar world order that gives equal voice to emerging powers. 
  • Concentration of power in two capitals marginalises middle powers like India, Japan, and ASEAN.
  • Example: India’s 2023 G20 presidency highlighted “One Earth, One Family, One Future,” emphasizing multipolar inclusion, a contrast to G2 concentration of power.
• Impact on Indo-Pacific and Quad:
  • Quad weakened: The Quad’s strategic relevance weakens as the US prioritises accommodation with China over balancing it.
  • China gains strategic space in Asia (from the South China Sea to the Indian Ocean) while US deterrence credibility declines.
• Regional Economic and Security Pressures: India and Brazil now face higher US tariffs (≈50%) compared to China (47%), reducing competitiveness.
  • China’s enhanced influence in South Asia and the Indian Ocean Region may intensify economic coercion and border assertiveness.

• Russia Factor: India must continue to “reassure Russia” amid a shifting triangular dynamic where the US tacitly accepts the China–Russia partnership.
  • The US reduced tariffs on Chinese goods by 10%, even though Beijing continues to buy oil from Russia.
  • Trump’s acceptance of China’s oil trade with Russia during the Busan talks undercuts Western sanctions and complicates India’s energy balancing.
• Regional Ripple Effects: Asian nations (Japan, Australia, ASEAN) face uncertainty; likely to pursue deeper intra-Asian cooperation independent of the US.
• • Regional balance tilts towards Chinese centrality, compelling India to reinforce its neighbourhood and maritime diplomacy.

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Way Forward for India

• Recalibrate Multi-Alignment Strategy: India must deepen its strategic autonomy by the approach of  “manage America, engage China, reassure Russia, and cultivate Europe”
• Strengthen Regional and Middle-Power Coalitions: Build tighter coordination with Japan, Australia, ASEAN, South Korea, and the EU to offset the G2 duopoly.
• Reinforce Economic and Technological Resilience: Accelerate manufacturing, digital, and semiconductor self-reliance to reduce exposure to G2-driven trade blocs.
  • Example: The India Semiconductor Mission (2024–25) and the PLI schemes for electronics and green tech strengthen India’s strategic autonomy in high-tech sectors.
• Lead on Multipolar and Inclusive Global Platforms: Reassert leadership in G20, BRICS+, Shanghai Cooperation Organisation (SCO), and Global South forums to counter bipolar dominance.
  • Example: During India’s G20 Presidency (2023) and continued 2025 engagements, New Delhi championed the African Union’s inclusion, reinforcing multipolarism and equitable governance.
• Deepen Neighbourhood and Maritime Diplomacy: Enhance influence through “Neighbourhood First” and SAGAR (Security and Growth for All in the Region) to secure India’s periphery.
• Institutionalise Long-Term Strategic Patience: Avoid reactive diplomacy; pursue issue-based engagement with both Washington and Beijing while investing in long-term capacity-building.
  • Example: India’s cautious but consistent BRICS+ engagement with China despite border tensions reflects a maturity that balances competition with cooperation.
• Issue-based cooperation with China and the U.S.: Adopt a sector-wise approach by cooperating on global issues (climate, health), competing in technology and trade, and hedging on security matters. 
  • Engaging both powers pragmatically through forums like G20, BRICS+, and Indo-Pacific mechanisms while avoiding rigid alignments.

Conclusion 

As the G2 remains an informal and unestablished concept, India should proactively reinforce multipolar frameworks and regional partnerships to prevent any future U.S.–China condominium from constraining its strategic autonomy and influence.

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