Rising trade tensions between the United States and China are expected to trigger significant shifts in Asia’s supply chain dynamics, as regional manufacturers look to diversify markets and mitigate risks, according to Indian industry sources.
Speaking to the Journal of Commerce, several experts noted that Chinese exporters, grappling with declining demand from the US due to escalating tariffs, are likely to redirect excess inventory to other regions. India, with its increasing reliance on imports of both finished and unfinished goods from Asia, is seen as a primary destination.
India has long held a substantial trade deficit with China, nearing $100 billion in fiscal year 2024–25, recent data shows.
In recent years, New Delhi has made a strong push to position India as a manufacturing alternative in Asia. However, this effort has also led to a surge in input sourcing from China, underscoring the complexity of decoupling supply chains.
“Nearshoring could gain traction in the short to medium term, especially with more China-origin goods being circulated within the region,” said a Mumbai-based carrier executive, who requested anonymity. “India’s stance on anti-dumping policies will play a critical role.”
Sunil Vaswani, executive director of the Container Shipping Lines Association (India), believes that China will increasingly look to India for new business opportunities amid ongoing tariff disputes.
“It could be a mutually beneficial scenario,” Vaswani said. “But India must remain vigilant against the dumping of Chinese goods, which could undercut domestic industries and hurt the ‘Make-in-India’ initiative. Encouragingly, Chinese firms seem more open to accepting India’s regulatory norms, including foreign direct investment rules with minority ownership caps.”
He added that India must also enhance its supply chain infrastructure if it hopes to compete effectively with Vietnam, another rising production hub in the region.
A logistics head from a major Indian conglomerate echoed that view. “China may start targeting other Asian countries that the US sees as favorable sourcing locations, potentially reshaping regional trade patterns,” the executive said.
Amid these shifts, intra-Asia shipping lines have stepped up services from India, with China and Vietnam becoming central to these expanded networks. Industry watchers expect further service additions as India’s import prospects strengthen.
Early signs are already evident. A new 2,200-TEU “Southeast Asia–East India” service—backed by Wan Hai Lines, Evergreen, RCL Feeder, and Bengal Tiger—is set to launch next month. Meanwhile, Pacific International Lines of Singapore is reportedly in discussions with RCL and Sinokor Merchant Marine to start a China–Malaysia–Singapore–India loop in June.
Major carriers like Maersk and CMA CGM are also weighing deeper involvement in the intra-Asia market, insiders say.
“We go where the cargo goes,” said a representative from a leading mainline operator. “Intra-Asia trades are crucial for maintaining container balance.”
Indian freight forwarders have already seen a rise in rate inquiries from local importers seeking to source goods from China, sources reported.
Intra-Asia import rates into India have remained largely stable over the past year, with current freight rates ranging from $900 per TEU to $1,000 per FEU for shipments from Shanghai or Ningbo to Nhava Sheva, according to market data.
Source: joc.com