‘US will have to keep making concessions’
Market Expert, Manish Singh believes the key lesson from this episode is clear: the balance of power is shifting.
“The biggest takeaway is that US is going to continue to make concessions and that is very-very clear from what happened today. This cannot be dressed as a win for the US and I do not mean in terms of any US-China competition sense, it is just common sense is prevailing that there are certain things that US cannot do or is not good at and it will have to strike deal and China is showing how you negotiate as an equal,” Singh said.
He added that while India isn’t in a position yet to negotiate as an equal power, the message for New Delhi is unmistakable:
“China has shown the way that if you make yourself domestically stronger and you have substitute and you have other means to keep yourself going, then in due course you could be negotiating with us as an equal… US does not have all the strong cards that people think they do because lots has changed over the last 10-20 years.”
Will the US-China thaw make it harder for India?
India has benefited significantly from global companies diversifying away from China, especially amid the tariff wars that began under Trump’s first term. But if Washington and Beijing find common ground, does that put India’s supply-chain advantage at risk?“That is a very good question and I think that it may as well turn out to be true,” Singh said. “If you look at the reason why the US companies or the west withdrew from China, it was because of this oncoming war or oncoming tariff war… It is very clear that US cannot win that.”
He explained that what’s unfolding now is “subscription diplomacy” — short-term, renewable deals rather than grand agreements.
“You are going to have the short-term deals, the kind that we saw yesterday, which I call subscription diplomacy because you have 12-month deal which can be renewed, in which terms can be changed. It can come up for renewal before the expiry of the term.”
Singh noted that such incremental deals may actually benefit emerging markets:
“If this becomes the base case that concessions are going to happen and deals are going to get struck, then that is very good news for emerging market, particularly for China and other nations as well… If this leads to more trade, then that is good news for everyone including India.”
FII flows and Fed signals
Foreign investors have pulled nearly ₹1.9 lakh crore from Indian equities in 2025, raising concerns about sustained global risk appetite. But Singh believes the broader macro picture remains encouraging.
“If we look at the Fed decision from yesterday or Wednesday, that tells you that Fed has not made up its mind where the rates are… My belief is that Fed is still going to cut rates in December and the conditions are going to ease,” he said.
He remains optimistic on growth prospects despite recent outflows.
“I am extremely bullish on growth. I think that the Fed has it wrong. Inflation is not a problem… To me the de-escalation between the US and China that is going to be very positive.”
Singh argues that the global economy is moving toward a “G2 world” — a term he uses to describe the US and China’s interdependent coexistence.
“I never saw this as a war. I have written about it that we are entering a G2 world where US and China will have to coexist… US does not have a strong hand and to me that is extremely positive because a lot of investment that has been withheld… will now flow again.”
Markets reading this as de-escalation, not breakthrough
While markets initially showed muted reaction to the latest Trump-Xi talks, Singh believes investors are interpreting this as the start of a longer process — not a sudden resolution.
“I would say that the market sees this as an ongoing deal. I mean, I do not think the market really thinks that there has been a big deal,” he explained.
“What you are really looking for has there been a de-escalation, has the path been set to discuss thing and agree in the future and that is what has happened. So what has it done to the market is that the risk which had built up because of deadlines coming up in November, that has gone away even if it is for three months or six months.”
According to Singh, China’s preparedness has given it an edge.
“Make no mistake… they are experts. They have been expecting this to happen. When the first time the tariff war started, they went back and they started preparing for it and seven year hence they are winning,” he said.
He concluded that the reduction in uncertainty itself is a positive for risk assets:
“I do not see market sell off and any concessions and more concession that may not be obvious on the screen but comes in a statement, that probably will help the market. I think more concessions have been made.”
Bottom Line
The latest episode in US-China relations might not have produced a “big deal,” but for markets and policymakers, it represents something equally valuable — a pause. For India, the message is to continue building domestic strength, remain flexible in global trade alignments, and be ready to play the long game in a world that’s increasingly defined by negotiation rather than confrontation.