By Annunthra Rangan
When Donald Trump revived the idea of a United States-China “Group of Two” (G-2) in 2025, the announcement seemed to defy the entrenched narrative of worsening Sino-American rivalry. After years of trade wars, decoupling rhetoric, ideological accusations, and military posturing across the Indo-Pacific, the notion that the world’s two largest powers might once again seek accommodation appeared implausible. Yet, seen through a longer historical lens, pragmatic moments of rapprochement have periodically punctuated the US-China relationship. Trump’s proposal, therefore, is not an aberration, but part of a recurring pattern stretching back to the 1972 Richard Nixon-Zhou Enlai opening that reshaped global geopolitics.
The original G-2 concept, coined by economist C Fred Bergsten in the mid-2000s, imagined the US and China as co-managers of global economic stability. While it briefly gained traction during Barack Obama’s first term as president of the United States, strategic distrust quickly derailed any real partnership. The 2025 revival, however, carries far greater consequences—China has evolved into a near-peer competitor, and the international order itself has grown fragile.
THE TRIANGULAR DIPLOMACY
To understand the contemporary G-2 moment, one must return to 1972, when US President Richard Nixon and Chinese Premier Zhou Enlai orchestrated one of the most consequential diplomatic shifts of the 20th century. At the height of the Cold War, the US chose to normalize relations with communist China—an extraordinary departure from the rigid ideological blocs of the time. Nixon and Henry Kissinger’s rationale was ruthlessly strategic: the Sino-Soviet split had created a rift Washington could exploit to pressure Moscow from two sides.
Triangular diplomacy ensured that the US would maintain better relations with both Beijing and Moscow than they had with each other. The goal was not alliance-building, but leverage. China, for its part, needed strategic insurance against the Soviet Union, access to Western technology, and a route out of the devastation wrought by the Cultural Revolution. The resulting rapprochement laid the groundwork for China’s integration into global markets and institutions—an integration that would later fuel its economic rise and eventual confrontation with American primacy.
INDIA’S FIRST TRILEMMA
The 1972 opening had immediate implications for India. Already shaken by its defeat in the 1962 Sino-Indian War, India viewed the US-China rapprochement with alarm. The timing was particularly fraught: Pakistan—India’s primary adversary—was aligned with both Washington and Beijing. During the 1971 Bangladesh Liberation War, the US openly backed Pakistan, even deploying the USS Enterprise to signal pressure on India. China, though not directly intervening, stood firmly on Pakistan’s side.
Feeling strategically encircled, India signed the 1971 Treaty of Peace, Friendship, and Cooperation with the Soviet Union, an implicit security umbrella that balanced against the emerging US-China-Pakistan axis. India thus learned early that duopolistic great-power management rarely favours middle powers.
The world of 2025 is vastly different from that of 1972. China is no longer an isolated developing nation, but a technological and military powerhouse. The US, while still the leading global actor, faces challenges to its hegemony unthinkable during the Cold War.
WHY SEEK RAPPROCHEMENT NOW?
First, economic interdependence remains deep despite political hostility. Neither the US nor China can fully decouple without severe costs. American businesses remain bound to Chinese markets and supply chains; China remains embedded in global manufacturing networks.
Second, the US faces vulnerabilities in rare earths, pharmaceuticals, and critical minerals—domains dominated by China. Stabilizing ties, even temporarily, buys time for the US to rebuild domestic capacity.
Third, this diplomatic revival is symbolically reflected in Washington’s decision to lower tariffs on Chinese imports to 47 percent while raising tariffs on India and Brazil to 50 percent—the highest imposed on any major partner. The signal is unmistakable: China is no longer viewed as the primary economic adversary, but as a necessary interlocutor in managing global volatility.
Fourth, the meeting’s neutral location echoes 1972’s deliberate staging, underscoring the desire for controlled optics.
Yet contradictions persist. Trump’s admiration for Xi’s “disciplined” cabinet sits uneasily alongside his criticisms of Chinese authoritarianism. The US secretary of defence’s remark that “US-China relations can never be better” reveals lingering distrust. These mixed signals mirror American anxiety about declining relative power and the difficulty of sustaining global leadership unilaterally.
CHINA’S “ZERO-ENEMY” DIPLOMACY
As scholars such as Degang Sun note, China has adopted a flexible “zero-enemy policy”, particularly visible in Asia and the Middle East. It simultaneously cultivates ties with rival states—Saudi Arabia and Iran, India and Pakistan—positioning itself as a mediator rather than a hegemon. This “major country diplomacy with Chinese characteristics” allows Beijing to operate fluidly in a fragmenting world where rigid alliances are liabilities.
India has experienced this flexibility firsthand. When US tariffs pressured New Delhi, Beijing responded constructively to Indian overtures. China rarely closes doors except on sovereignty issues. It plays the long game, using multi-alignment to maximise leverage.
INDIA’S STRATEGIC UNEASE
For India, a revived G-2 is both unsettling and transformative. A stable US-China modus vivendi could:
- Dilute the Quad, weakening a key balancing platform;
- Reduce India’s strategic relevance to Washington;
- Intensify India’s economic exposure to Chinese dominance;
- Embolden the China-Pakistan military partnership that threatens Indian security.
India faces a record $99.2 billion trade deficit with China. The imbalance—raw materials exported, high-value electronics imported—creates asymmetrical dependency. China’s control over rare earths, pharma inputs, and industrial machinery grants it coercive power. US tariff reductions for China only deepen this risk.
India’s security vulnerabilities were exposed in Operation Sindoor, when China provided Pakistan with real-time intelligence and Turkey supplied drones. China now constitutes 81 percent of Pakistan’s military equipment, effectively turning it into a proxy test bed. Should Washington soften towards Beijing under a G-2 framework, India might lose a critical counterweight at a moment of border volatility.
The Ladakh stand-off since 2020 is not an aberration, but a structural recalibration of China’s approach to India. With upgraded infrastructure and deployments across the Tibetan plateau, Beijing has signalled its intent to maintain sustained military pressure. A functioning G-2 could dull US willingness to challenge Chinese moves in the Himalayas or the Indian Ocean.
Lower US tariffs on China and higher ones on India undermine New Delhi’s aspiration to be the “China+1” hub. Multinationals may rethink relocating to India. Renewed US-China engagement could re-energise Chinese competitiveness in sectors—electronics, solar, chemicals—where India hoped to expand.
Even more consequentially, a G-2 could shape technology, digital governance, finance, and climate frameworks that bypass India. Historically, great powers have made the rules; rising powers have adapted to them.
A G-2 also recalibrates the outlook for Japan, ASEAN, Australia, and Europe—all of whom leveraged US-China friction to expand influence. India’s neighbourhood—Sri Lanka, Nepal, the Maldives—may tilt further towards Beijing if US restraint appears entrenched.
TURNING CHALLENGE INTO OPPORTUNITY
Yet the G-2 revival need not marginalize India—it can galvanize it. India must act like the pivotal power it already is by:
1. Deepening defence-technology ties with the US to preserve convergence even amid rapprochement.
2. Engaging China selectively where interests align.
3. Strengthening partnerships with France, Japan, Australia, Europe, and ASEAN to reinforce multipolarity.
4. Accelerating indigenous capabilities in manufacturing, logistics, and digital infrastructure.
5. Leading global rulemaking in digital public infrastructure, fintech, and climate resilience.
India’s long-term influence depends on domestic transformation—stronger manufacturing, predictable regulations, and deeper value-chain integration. Only then can India navigate great-power politics without being hostage to them.
The revived G-2 marks neither the end of US-China rivalry nor a permanent duopoly. It is a tactical recalibration driven by necessity, domestic pressures, and global instability. Its longevity is uncertain; its implications are immediate.
India’s challenge is to avoid being sidelined by another era of great-power condominium. The task is not merely to respond to the G-2, but to ensure that any future architecture of global governance must account for India’s presence.
India’s best strategy is muscular multi-alignment with real capabilities. In 1972, India had to insure itself against other people’s triangles. Today, it has the rare chance—to shape the geometry itself.
—The writer is a Senior Research Officer at Chennai Centre for China Studies. Her research interests constitute China-WANA (West Asia and North Africa) relations and human rights