New Delhi:

With Donald Trump set to become the next US president after the recently closely contested presidential polls, India and other Asian countries are expected to benefit due to rising US-China tensions and potential investment restrictions in strategic sectors, as per Moody’s Ratings.

“In the Asia-Pacific region, trade and investment flows might be further diverted away from China as the US tightens investments in strategic sectors, which would negatively affect China’s economy and consequently dampen regional growth. However, this shift might benefit India and ASEAN countries,” the global rating agency said.

The global agency anticipated a significant shift under the Trump administration across fiscal, trade, climate, and immigration issues, departing from the approach of the administration of the current US President Joe Biden.

The rating agency added that Trump could have both legislative and executive avenues to advance his agenda on every front.

It further added that as a candidate, Trump promised tax reform, with plans to make the 2017 Tax Cuts and Jobs Act permanent, lower the corporate tax rate, and implement income tax relief. These initiatives, along with targeted and broad tariffs, including steep tariffs on Chinese imports, are expected to increase federal deficits.

It highlighted that the US under Trump will adopt a protectionist trade policy, which would be more disruptive and increase the risks to global growth.

“Protectionist measures could disrupt global supply chains and negatively affect sectors that rely on imported materials and goods, such as manufacturing, technology, and retail,” it added.

Trump’s trade policy approach would likely bring immediate impacts to the manufacturing sector, the credit rating agency said, adding that although a divided Congress might slow down or adjust the scope of such measures.

The climate initiatives of the US are also likely to see reversals as Trump seeks to boost fossil fuel production under the banner of “American energy dominance.”

Reduced funding for clean energy projects and a possible withdrawal from the Paris Agreement would undermine the US’s commitments to reduce greenhouse gas emissions.

While federal support for green technologies may wane, private-sector initiatives and state-level mandates, particularly in renewable energy, are expected to partially offset this shift.

Some industry experts believe market-driven growth in wind and solar could continue, as these energy sources have become cost-competitive in many parts of the country.

“The shift would likely result in renewed support for the fossil fuel industry, reduced funding for clean energy and green technologies, and loosened environmental regulations, including the Environmental Protection Agency’s efforts to reduce emissions in the power and auto sectors. It is likely that the Trump administration will withdraw from the Paris Agreement again and reverse commitments to meeting net-zero greenhouse gas emissions by 2050,” the agency said.

On the regulatory front, Trump is expected to pursue a lighter approach, as per the Moody’s, which will include relaxed rules for small and midsized banks, potentially reducing their capital requirements but also exposing creditors to higher risks.

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)

Zhang Youxia, Vice Chairman of the CPC Central Military Commission, second from right, holds a meeting with White House national security adviser Jake Sullivan, second from left. during a meeting at the Bayi building in Beijing, on August 29, 2024
| Photo Credit: AP

United States National Security Adviser Jake Sullivan met Thursday (August 29, 2024) with a top Chinese military official as the two countries strengthen communication in an effort to prevent differences over the South China Sea and Taiwan from spiralling into conflict.

The meeting came one day after the White House said that both countries would plan for a phone call between Chinese President Xi Jinping and U.S. President Joe Biden in the coming weeks.

Mr. Sullivan was wrapping up a three-day trip to China, his first as national security adviser and one aimed at stabilising bilateral relations to avoid conflict.

His main talks were held over the past day and a half with Wang Yi, the foreign minister and the ruling Communist Party’s top foreign policy official.

The meeting Thursday was with Gen. Zhang Youxia, one of two vice chairs of the Central Military Commission, an organisation that Xi personally heads. It was a rare meeting with a US official that came at a time when both sides are eager to keep relations on an even keel ahead of a change in the US presidency in January.

“Your request to meet with me shows the value you attach to military security and the relationship between our militaries,” Zhang told Sullivan in opening remarks.

A White House statement after the talks said the two had “recognised the progress in sustained, regular military-military communications over the past ten months” and noted the agreement announced Wednesday to hold a telephone call between commanders at the theatre-level in the near future.

China suspended communication between the two militaries and in a few other fields after a senior US lawmaker, then-House Speaker Nancy Pelosi, visited Taiwan in August 2022. Talks were only gradually resumed more than a year later, after Xi and Biden met outside San Francisco in November.

A theatre-level call would be between Adm. Samuel Paparo, who heads the US Indo-Pacific Command in Hawaii, and his Chinese counterpart, said Danny Russel, a vice president at the Asia Society Policy Institute in New York.

“This theatre command-level dialogue is critical for crisis prevention but something the Chinese military has been resisting,” Russel said.

A White House statement after talks with Wang concluded Wednesday said both sides would keep lines of communication open, including planning for a “leader-level call” in the coming weeks. The Chinese Foreign Ministry said Wang and Sullivan discussed “a new round of interactions between the two countries’ heads of state to take place in the near future.”

There was no indication whether the two leaders might meet in person before Biden leaves the Oval Office.

Washington has been working to boost its diplomatic presence in the Pacific to counter what it sees as a growing threat from China, its main strategic rival.
| Photo Credit: Photo credit: X/@StateDept

The United States opened an embassy in the Pacific island nation of Vanuatu on July 18, the latest U.S. move in a long-running competition with China for influence in the Asia Pacific region.

“The opening of the embassy builds upon our efforts to provide more diplomatic presence throughout the region and to engage further with our Pacific neighbors,” the U.S. Department of State said in a statement.

“The U.S. earlier opened embassies in two other island nations, Solomon Islands and Tonga, and plans to open one more in Kiribati,” a State Department official told the U.S. Congress in March. “The Kiribati mission is awaiting Parliamentary approval,” the official said.

Washington has been working to boost its diplomatic presence in the Pacific to counter what it sees as a growing threat from China, its main strategic rival.

In February, the United States cautioned Pacific island nations against accepting assistance from Chinese security forces following a Reuters report that Chinese police were working in Kiribati, a remote atoll nation near Hawaii.

Chinese police have deployed in the Solomon Islands since 2022 after a secret security pact criticised by the United States and Australia as undermining regional stability. Concerns have been raised also over workers in military uniforms in Vanuatu after a Chinese company began logging there.