New equilibrium: on the recalibration of U.S.-China ties

On the surface, Chinese President Xi Jinping’s Washington visit appeared to be more about ceremony than substance. President Donald Trump rolled out the red carpet, personally welcoming the Chinese leader at the base where he landed. The last time that a U.S. President accorded such an honour to a foreign leader was when John F. Kennedy welcomed British Prime Minister Harold MacMillan in 1962. Mr. Trump also laid out a grand state dinner at the White House, inviting some of the biggest names in tech and business in the U.S. Beyond the optics, the concrete outcomes from the Trump-Xi talks were modest. The most immediate one was an agreement for both leaders to meet twice this year at the APEC summit in Shenzhen and the G-20 in Miami, marking an unusual four meetings in one year, with Mr. Trump having visited Beijing in May. Both sides also agreed to operationalise a board of trade and investment. No new trade agreement was reached, although both have extended for another two months the trade truce agreed to at Busan last year as well as an arrangement for a $30 billion reciprocal tariff reduction. China reaffirmed its commitment to buy $17 billion worth of agricultural products annually, but offered no new ones. Other long pending issues such as semiconductors, rare earths and U.S. arms sales to Taiwan appear deferred for now. Both did, however, announce the establishment of a new dialogue on Artificial Intelligence and the opening of a channel for incidents, amid growing concerns over the consequences of an unregulated AI race.The modest outcomes from the Xi visit should not obscure the broader shift that recent U.S.-China engagement has underlined. The agreement between the world’s two biggest powers to pursue what they call a constructive relationship of strategic stability based on fairness, respect and reciprocity points to a new equilibrium. Their relationship certainly remains beset by serious structural challenges and will remain one marked by rivalry. At the same time, both sides appear eager to set a floor to ensure a rivalry that is more managed, stable and predictable. Countries in the region will be watching closely how this may temper an “America First” Washington’s appetite to push back against China in waters far from home. New Delhi will need to carefully watch this evolving new equilibrium. The recent U.S. tariff threats aimed at India have offered a stark contrast to the measured language with which Washington has been engaging Beijing. For long, a strand of Indian strategic thinking has been predicated on the assumption that U.S. strategy in the region was centred on the idea of a relationship with India as a bulwark against Chinese influence. That assumption increasingly appears open to question. Published - September 28, 2026 12:10 am IST