If there is one country poised to benefit from this trans-Pacific tension, it is the world’s most populous democracy. India combines low labour costs, a massive youth workforce, digital infra, and growing strategic alignment with the West.
OTTAWA: Last week, the Dow Jones Industrial Average surged over 3,000 points for a moment; a market rally driven not by peace or prosperity, but by Donald Trump’s pause in the economic war unleashed by the US President himself, just over a week ago.
President Trump has carried through on his promise to slap 125% tariff on Chinese goods; coupled with China’s swift retaliatory moves, this has set the tone for what may become the most consequential trade conflict of the 21st century. Yet this isn’t just about economics. It’s about power, security, and a seismic shift in who will control global manufacturing and commerce. China had set out to dominate critical minerals and the control of the green agenda EV supply chain—one where North America and India may become the twin engines of a post-PRC/CCP world if we can align the stars.
The Trump administration’s tariff proposals may appear outrageous to some. But beneath the bombast lies a clear and calculated strategy: to dismantle China’s grip on key industrial sectors and re-anchor manufacturing within a continental economic and security zone—a de facto fortress economy shared by the United States, Canada, and Mexico. This emerging framework resembles a modern-day “Fort Knox”—not of gold, but of semiconductors, batteries, rare earths, nuclear energy, pharmaceuticals, and AI infrastructure.
America is starting to regain its swagger and emerging as leader in new military infrastructure technologies and how we build our future defence systems in the critical areas including cyber and robotics. AI is driving America’s new military technology complex and organizations like Palantir Technologies is one of a host of new leaders in DC that is shaking the hold of the big five on defence spending at the Pentagon. Value for money is driving the bus and DOGE, in spite of its poor execution at times, is sending the message to all.
When one sits back and looks at how the tariffs were riled out, it resembled Chaos in oh so many ways, but perhaps in every sense, it was a pre-emptive strike—not against China’s military, but its manufacturing and industrial base that was set to flood Europe and the rest of the world with cheap government subsidized electric vehicles that would have met surging demand from environmentally astute consumers.
No this was about the current global order, shaped by decades of outsourcing and economic interdependence, and it’s about to be reset. Trump’s tariffs are not only a reaction to China’s trade surplus and its intellectual property theft—they are an opening salvo in a broader geopolitical realignment. Washington is drawing new red lines in supply chains. And the Dow’s exuberance for a day showed that Wall Street, once a bastion of globalist thinking, may finally be betting on national resilience over foreign dependence but believing that the rest of the world will buckle and acquiesce to the administration’s tough love approach. In Beijing, the response was predictable. Reciprocal tariffs, nationalist rhetoric, and quiet lobbying through American multinationals. Yet Xi Jinping knows that the global tide is turning. China is no longer the irreplaceable factory of the world. It is a rival superpower locked in a struggle over everything—from rare earths to naval and freedom of navigation routes. And in this new contest, the battlefield is economic before it is kinetic. However, but that scenario (military conflict) was seen as more imminent in the South China Sea than any other time in our history.
Enter India
If there is one country poised to benefit from this trans-Pacific tension, it is the world’s most populous democracy. India combines low labour costs, a massive youth workforce, digital infrastructure, and growing strategic alignment with the West. Already, Apple, Foxconn, and a slew of other companies are shifting production to Tamil Nadu and Uttar Pradesh. There are also a number of new biotechnology and leading edge cancer therapy partnerships emerging with European NGOs. The Narendra Modi government, understanding the opportunity, has rolled out aggressive production-linked incentives and free trade deals with key partners. India is not just filling the vacuum left by China—it is redesigning the floor plan.
A North American-Indian economic axis could become the centrepiece of a new, resilient global order. Think of it as NAINDO—a NATO-style framework for economic security, not military defence. Such a coalition could pool innovation, shield supply chains, and erect joint tariffs against coercive economies. It could also accelerate the decoupling from Chinese overreach in everything from green energy to biotech.
Of course, critics argue that tariffs will raise prices for consumers and trigger inflation
What we are witnessing is not merely protectionism—it is the birth of an economic doctrine: continentalism for the age of great power competition. Just as the U.S. once mobilized its industries to defeat fascism, it is now retooling to counter Chinese authoritarian capitalism. Canada and Mexico have a choice to make and with a Canadian election now in full swing, will Canadians accept a globalist China-centric Liberal party or a Conservative party that is only now articulating a new vibrant economic plan for resource extraction, bio-technology, nuclear energy and a new course and partnership with our allies including India?
This tariff plan, which looked crazy to all at the outset, and his sudden reversal in the form of a 90-day pause (one-on-one negotiations commence on Sunday with a European delegation) that led to the 3,000-point Dow rally, is not a market anomaly, but get used to the economic instability for the next 60 days until deals can be made and commitment to economic decoupling from China can be realized.
It is a signal. Investors know a new game is one where national power and industrial capacity once again walk hand in hand. The question is not whether Trump’s economic war will reshape the world.
It already has
Dean Baxendale is Publisher, CEO of the China Democracy Fund and co-author of the upcoming book, Canada Under Siege.