How China emerged stronger than ever amid US tariffs—and what India can learn from it

Subscribe to enjoy similar stories. Few questions are as revealing today as how the world’s two largest economies—the US and China—differ in their economic approaches. In Breakneck: China’s Quest to Engineer the Future (2025), Dan Wang offers a useful lens.

China, he argues, functions as an “engineering state," where leaders and institutions think like engineers, prioritizing large-scale building, rapid industrial expansion and centralised problem-solving. This contrasts sharply with the US’s more process-oriented, rule-bound “lawyerly society". This engineered flexibility helps explain how China weathered successive rounds of US tariffs and emerged stronger, posting a record trade surplus of $1.2 trillion in 2025.

Below is a look at the forces behind China’s trade resilience—and the lessons for India. China’s response to US tariffs in 2025 offers a clear example of this flexibility. The trade war pushed cumulative US tariffs on Chinese goods to a peak of about 145%, before easing to around 30%.

China’s exports to the US fell by roughly 20%. Yet the export engine did not stall. Instead, Chinese firms rapidly redirected shipments to alternative markets.

Exports rose sharply to Africa (26%), the ASEAN bloc (13.4%), India (12.8%) and the European Union (8.4%). At the same time, US imports from countries such as Thailand and Vietnam surged, reflecting trans-shipments of Chinese goods routed through these economies. India has shown resilience under tariff pressures as well, but via a different route.