China’s Growth Slows To 4.8%, Trump Threatens Tariffs – Why The World’s Eyes Turn To India | World News
Beijing: China’s economic momentum has faltered. In the July-September quarter, the country’s GDP increased by only 4.8%. This is the slowest growth in the last year. Trade tensions with the United States and weak domestic demand have left Beijing’s economy vulnerable. Additional challenges may follow. US President Donald Trump threatened to impose customs duties of up to 100 percent starting from November. China’s over-reliance on exports raises questions about whether it is ready to tackle structural reforms for long-term sustainable growth.
On the contrary, India is getting stronger. In the first quarter of fiscal year 2025-26 (April-June 2025), it recorded a staggering growth of 7.8%. The world now sees the country as a key driver of global economic growth.
In the third quarter, the Chinese economy recorded its slowest growth in a year. Weak domestic consumption has pushed Beijing to focus heavily on manufacturing and exports. Analysts warn of structural imbalances that could have lasting effects.
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GDP data released on Monday shows China’s third-quarter growth at 4.8%. Expectations suggest the economy could potentially reach growth of around 5% for the year with additional stimulus. Lin Song, ING’s chief economist, highlighted the persistent problems: “Weak confidence is limiting consumption, investment is softening and property prices remain under pressure. These challenges still require urgent attention.”
Recent export patterns reveal that China is shifting trade away from the United States. Exports to America, the world’s largest consumer market, fell 27 percent compared to last year. At the same time, shipments to the European Union, Southeast Asia and Africa increased by 14%, 15.6% and 56.4% respectively.
Despite these gains abroad, domestic demand continues to remain weak. In September, retail sales fell to the lowest level in the last 10 months. The Reuters survey confirmed that GDP growth in the third quarter fell to 4.8% from 5.2% in the second quarter, in line with market expectations.
Exposed Weaknesses
Increasing trade tensions with the USA have revealed the vulnerabilities in China’s export-dependent economy. The situation suggests that Beijing may need to turn to domestic consumption to stabilize growth.
Although there was some recovery in exports in September, most data point to a slowdown in the second largest economy. Inflation pressures persist despite efforts to curb overcapacity and maintain competitiveness.
Profitability is hurting as China increases its exports to markets outside the US. Fierce price competition is squeezing margins, making growth unsustainable until trade tensions ease.
Trump’s threat to impose 100% tariffs on Chinese goods starting in November looms large. However, US officials say both sides are open to resolving the tariff dispute.
Challenges and Adaptation
Jeremy Fung, a salesman for a Chinese aluminum producer, reported a 20% drop in revenue. While sales to Latin America, Africa, Southeast Asia, Turkey and the Middle East increased, orders from the USA dropped sharply by 80-90%.
Fung said he learned Spanish to reach markets outside the U.S. and now travels abroad twice as often as last year. However, these efforts cannot fully compensate for the US’s losses.
India’s Moment is Coming
While China struggles with growth limited to 4.8% in the third quarter, the Indian economy is accelerating. Strong domestic demand, production-based incentive programs and structural reforms trigger the country’s fast pace.
India is emerging as a reliable destination for global manufacturing and investment.
China’s real estate crisis and weak consumer demand are driving investors to diversify supply chains and capital. This creates an unprecedented opportunity for India to capture a larger share of global exports and investment. The balance of economic power in Asia may now shift decisively towards India.
