The escalating trade conflict between the US and China has the potential to redefine supply chain dynamics in Asia as regional manufacturers search for new growth markets, industry sources in India believe.

Multiple sources who spoke with the Journal of Commerce noted that Chinese exporters facing demand headwinds in the US due to soaring tariffs will likely attempt to dump inventory stocks in other markets, with India widely viewed as a key target. That's because India depends heavily on imports of both finished and unfinished goods from Asia to support burgeoning consumer demand and industrial verticals slowly gathering pace.

Historically, India has a gaping trade deficit with China, which stood close to $100 billion in fiscal year 2024–25, new data shows.

New Delhi has undeniably demonstrated a stronger intent in recent years to emerge as an alternative production hub in Asia, but that push has seen its input sourcing accelerate out of China.

“Nearshoring could gain momentum in a near- to medium-term trend of China-origin goods increasingly flowing regionally,”a Mumbai-based carrier executive who did not want to be identified told the Journal of Commerce.“A lot also will depend on India's anti-dumping policies.”

Sunil Vaswani, executive director of the Container Shipping Lines Association (India), believes China will undoubtedly explore greater business opportunities with India amid the“tariff brouhaha.”

“While it's a win-win proposition for both sides, India needs to keep a vigil on any dumping of goods by Chinese suppliers as that probability could harm domestic interests around the'Make-in-India'strategy,”Vaswani said.“There are indications that Chinese companies are now more willing to accept Indian regulatory conditions, including minority ownership for foreign direct investment.”

Vaswani also noted that India needs to upgrade its supply chain ecosystem to better compete with Vietnam, another key production source in Asia.

A Mumbai-based logistics head at a diversified conglomerate echoed that premise.“There is a fair chance China will use other Asian markets that it believes the US will favor sourcing from, and this could spell a new trade pattern,”the source said.

‘Chasing cargo’

Targeting the trade diversification, predominant intra-Asia liners have already substantially enhanced coverage out of India with China or Vietnam the focal cargo point. And sources anticipate another wave of network expansions in the days ahead as inbound trade prospects for Indian ports brighten.

Some signals are already emerging — a new 2,200-TEU“Southeast Asia-East India”network led by Wan Hai Lines, Evergreen, RCL Feeder and Bengal Tiger is due to begin next month, while Singapore's Pacific International Lines is reportedly in talks with RCL and Sinokor Merchant Marine to open a China-Malaysia-Singapore-India loop in June.

Several mainliners, particularly Maersk and CMA CGM, are also considering entering the intra-Asia market in a bigger way, industry insiders say.

“We are in the business of chasing cargo,”a mainliner source said.“Intra-Asia trades remain vital to container inventory management.”

Indian freight forwarders are already fielding more inquiries from local importers regarding rate indications for services out of China, sources told the Journal of Commerce.

Indian import rates on the intra-Asia trade lane have been mostly steady over the past year, with the current trendline in the range of $900 per TEU and $1,000 per FEU for loads from Shanghai or Ningbo to Nhava Sheva, data reveals.