India, Russia, and China are moving closer together as global power dynamics shift, driven by US tariffs, Western sanctions, and a shared push to reduce reliance on the US, an analyst said.
US President Donald Trump hinted at resuming the “very special relationship” with India, which has taken a hit due to the imposition of 50% tariffs on Indian exports. “I will always be friends with Modi, he is a great Prime Minister,” Trump told reporters on Saturday.
“India and the United States have a special relationship. There is nothing to worry about,” he added.
Responding on X, Modi echoed Trump’s sentiments and highlighted that India and the US share a positive and forward-looking comprehensive global strategic partnership.
The change in tone comes on the back of the Shanghai Cooperation Organisation (SCO) meeting last month, which was closely watched by Washington. “Looks like we’ve lost India and Russia to deepest, darkest China. May they have a long and prosperous future together,” the U.S. President had written on his social media platform Truth Social then.
India’s Balancing Act
India, Russia, and China are moving closer together as global power dynamics shift, driven by US tariffs, Western sanctions, and a shared push to reduce their reliance on the US, said SEBI-registered analyst Pradeep Carpenter.
For markets, this alignment signals new trade corridors, wider use of local currencies, and shifting flows in commodities, defence, and capital. For India, the strategy offers leverage but also balancing risks, he said.
The US tariff regime, particularly under the Trump administration, has prompted China to seek stronger partners in Asia. At the same time, sanctions on Russia following the Ukraine war have cut off access to Europe, pushing Moscow to deepen energy and defence exports to Asian markets.
China’s strategic aim is to reduce US dominance in trade, finance, and technology by developing alternative alliances, while India seeks affordable Russian energy, trade links with China, and technology access from the US – a situation which requires a careful balancing act, Carpenter added.
Global markets will see a gradual erosion of the dollar’s dominance as local currency settlements expand, though with added volatility in forex markets. Commodity flows will shift toward Asia, with Russian oil, gas, and metals strengthening supply but maintaining high prices during periods of geopolitical tension. Investors are likely to add a “risk premium” across assets, boosting demand for safe havens like gold and US Treasuries, he said.
For India, opportunities lie in cheaper energy imports, stronger BRICS corridors, and gains in manufacturing and infrastructure. Risks, however, include potential strains with the West in technology and capital flows, as well as persistent border frictions with China. Key beneficiaries could be defence, energy, infrastructure, and domestic financials, while exporters reliant on US and European demand may face challenges, Carpenter said.
For updates and corrections, email newsroom[at]stocktwits[dot]com. <