In a notable de-escalation of trade tensions, the United States and China have initiated a 90-day truce, significantly rolling back tariffs as both sides work toward finalizing a long-term economic agreement.
Under the temporary agreement, which began in mid-May 2025, the U.S. has slashed its tariffs on Chinese imports from a steep 145 percent to 30 percent, while China has reduced its retaliatory duties from 125 percent to 10 percent. The truce is set to expire in mid-August, placing pressure on negotiators to reach a broader deal before trade barriers snap back into place.
Framework Agreement Reached
Following several high-level discussions, both countries confirmed in late June that they had settled on a basic trade deal framework. As part of this development:
- The US has agreed to ease certain restrictive trade measures.
- China has committed to streamlining the approval process for export-controlled goods, a move seen as a trust-building step toward deeper collaboration.
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While optimism surrounds the progress, both sides acknowledge that substantial work lies ahead before a permanent agreement can be signed. The upcoming weeks are likely to test the durability of this detente, especially with thorny issues like technology transfer, intellectual property, and supply chain controls still unresolved.
For now, global markets have responded positively to the tariff reprieve, and trade-dependent sectors in both countries are hoping the momentum carries through to a full-scale resolution.
With the clock ticking toward a crucial July 9 deadline, India and the United States are locked in intense negotiations to finalize a Bilateral Trade Agreement (BTA) and sidestep a looming hike in tariffs.
US President Donald Trump has expressed confidence that a deal is imminent—one that would significantly reduce tariffs and create a level playing field for both nations.
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“I believe we’ll reach an agreement with India,” Trump said. “It’ll be a deal where we can compete. India currently blocks too much, but if they act, we’ll lower tariffs substantially.”