Asia Pacific News
LAST UPDATE: July 29, 2025
US, China hold new talks on tariff truce, easing path for Trump‑Xi meeting
Senior U.S. and Chinese economic officials met in Stockholm on July 28 to extend a tariff truce by 90 days, aiming to reduce longstanding trade tensions and lay groundwork for a possible meeting between Presidents Trump and Xi.
Insight
The extension of the current tariff pause until approximately mid‑November creates a window for de‑escalation and strategic planning ahead of potential high‑level diplomacy, balancing short‑term stability with long‑term trade leverage. Analysts believe it could smooth the path to a formal Trump‑Xi summit.
Donald Trump freezes export controls to secure trade deal with China
The U.S. has paused restrictions on exporting certain advanced tech, notably Nvidia’s H20 chip, to China. This move is aimed at avoiding disruptions in trade talks and supporting efforts to arrange a Trump-Xi meeting later in the year.
Insight
Pausing export controls signals a shift in U.S. policy, putting trade diplomacy above security constraints. Critics warn of strategic risk, arguing it undermines long-term technological and military advantage. Meanwhile, Nvidia asserts the chip is not militarily beneficial and key to global AI leadership.
Trump to restart trade negotiations with Thailand, Cambodia
Following the ceasefire, President Trump instructed U.S. trade officials to resume negotiations with Thailand and Cambodia about trade relations.
Insight
Trump’s linkage of trade incentives to peace diplomacy reflects a tactic of using economic negotiation as leverage in foreign policy. The strategy ties regional stability to U.S. commercial engagement.
India Warns of Trade Risks Amid Trump Tariffs, Global Slowdown
India’s Finance Ministry warned of potential downturn in export performance due to uncertainty over U.S. tariff policy and a slowing global economy, particularly reduced demand from the U.S.
Insight
The warning highlights India’s export vulnerability to external policy shocks. Ongoing tariff volatility injects risk into planning and may push Indian policymakers toward greater domestic resilience and diversification of markets.
Defence minister denies India bowed to pressure to end fighting with Pakistan
India’s Defence Minister Rajnath Singh refuted claims that India halted operations in its border conflict with Pakistan due to external pressure, stating that all military and political objectives were met.
Insight
By asserting self-determined decision-making, India reinforces its strategic credibility and counters narratives of foreign influence. The denial strengthens its posture of autonomy in regional security affairs.
Indonesian government plans to place funds in state banks to provide liquidity
Indonesia plans to inject capital into four state-owned banks to expand liquidity and support low-interest loans to village cooperatives, targeting economic growth of 8% up from 5%. Loans will be offered at around 6% interest, with each cooperative eligible for up to 3 billion rupiah.
Insight
This initiative emphasizes grassroots economic support and credit inclusion. By mobilizing state banks, the government aims to boost rural productivity and meet cooperative demand—a strategic investment in domestic development.
Palau lawmakers reject US request to accept third country refugees
Palau’s National Congress formally rejected a U.S. proposal for Palau to accept third‑country asylum seekers. The agreement would have allowed financial assistance and selective acceptance but Palauan leaders considered it problematic for their society.
Insight
Palau’s firm rebuff illustrates the complexities small states face balancing diplomatic ties with domestic concerns. Their rejection sheds light on sovereignty issues and the limits of U.S. asylum relocation diplomacy in the Pacific.
US to resume grants to Nepal for two key infrastructure projects
The U.S. will resume $500 million in Millennium Challenge Corporation (MCC) funding for two major infrastructure projects in Nepal—a power‑transmission line to support energy trade with India and road network improvements.
Insight
Restarting the grants signals renewed U.S. commitment to regional development and energy integration in South Asia. It offers an opportunity to reinforce strategic cooperation with Nepal, though other development aid projects remain suspended.
