U.S. Tariffs Strain India-U.S. Trade, Prompt Modi’s China Visit; Japan Reviews Impact Amid Quad Cooperation

The recent escalation of U.S. tariffs under President Donald Trump has strained trade relations with key Quad allies India and Japan. India, in particular, faces unprecedented import duties from the U.S., attributed to a failure to reach a trade deal and irritation over India's continued defense and oil imports from Russia. This trade tension has prompted Indian Prime Minister Narendra Modi to move closer to Russia and China, reversing India's previous policy of distancing itself from these nations. Japan's Chief Cabinet Secretary Hayashi has stated that the impact of U.S. tariffs on India is under review, while Japan's planned visit to the U.S. remains undecided. Despite the absence of a formal trade framework, the Quad alliance continues to advance cooperation in sectors such as semiconductors, 5G, and clean energy, with an upcoming India summit seen as an opportunity to deepen partnerships. Analysts note that China's growing influence in Asia could be bolstered by intra-Quad friction, as Beijing seeks to exploit rifts between Delhi and Washington amid ongoing border and trade negotiations. Barclays Research has indicated that Indian corporate credits are expected to withstand the tariff escalation despite the rising import duties. The situation is being closely watched as Modi prepares for an unusual visit to China following the U.S. tariff offensive.