US and Chinese president met on the sidelines of Asia-Pacific Economic Cooperation (APEC) summit in Busan

Posted 31 Oct 2025

2 min read

Article Summary

US and China agreed to reduce tariffs, extend rare earth export controls, and promoted a G-2 partnership, signaling a shift towards bipolar global dynamics affecting regional institutions and India’s strategic position.

Key Outcomes of Busan meet

U.S. agreed to reduce a tariff punishing China for the flow of fentanyl into the U.S. by 10%.
- Fentanyl is an opioid drug, like morphine or heroin, made entirely in laboratories with no natural ingredients.
China agreed to extend for one year a pause on export controls of rare earth minerals.
- Rare earths (group of 17 metallic elements) are used to produce magnets and other components used in missiles, aircraft, cars, refrigerators, other hi-tech devices etc.
US president dubbed the meeting as G-2, a word first popularized by American economist C.F Bergsten in 2005.
- G-2 envisaged the US and China as co-managers of global stability through joint responsibility on economic governance, trade imbalances, and global problem-solving.

Implication of G2 for world

Relevance of Regional institutions: Like Quad, Aukus, which were put to counter China could be questioned as US and China move towards a strategic accommodation.
Shift Towards Bipolarity: G2 signals convergence between US and China as global powers and bilateral decisions on key global issues can undermine multipolarity and interests of global south.
Dependence on China: The shift identifies global and American reliance on China for critical minerals and semiconductor supply chains.
Implications for India: US-China rapprochement could reduce the US’s reliance on India as a geopolitical counter to China while emboldening China’s assertiveness towards India.