India, May 14 -- The US and China, the world's largest and second-largest economies, have agreed to bring down their tariffs on imports from the other from 145% and 125% to 30% and 10%, respectively. The arrangement, which was reached by the two countries in Geneva on Monday, is for 90 days as of now, a period during which they are expected to arrive at a more detailed arrangement. The latest detente between these two countries marks yet another turn in the ongoing drama between the US and China, where each side was expected to suffer heavy losses as they indulged in brinksmanship over complete economic decoupling - which is what would have happened had the tariffs stayed in three digits. To be sure, it is premature to see the current arrangement as something cast in stone or restoration of status quo ante. Experts have pointed out that even the current tariff levels are higher than what they were before the second Trump presidency. There is no reason to believe that an agreement will be worked out in the next three months. What does all this mean for US-China and the world at large? Three things can be flagged at the moment. Trump's mercantilism was not just a challenge to the multilateral global order but also the American financial markets. Big Finance has made a fortune for itself despite a lot of working-class Americans becoming worse off with a rise in US trade deficits. The fact that Trump has had to back off by quite a few steps because of financial market meltdown shows that Wall Street has not lost its power in the US. China, if the current tariff levels persist, will still enjoy a large advantage in bilateral talks vis-a-vis the US and in the global manufacturing landscape. But the events over the last couple of months are only likely to further spook non-Chinese manufacturers into finding locations that are less likely to draw the ire of US mercantilism than China (which should help boost India's China-plus-one appeal). To be sure, the world will increasingly have to deal with China's home-grown brands which have emerged as able competitors in many sectors. The rest of the world, India included, will face both headwinds and tailwinds from this ongoing churn. The investment climate will continue to be uncertain thanks to Trump's flips-flops, but like the Sino-US thaw shows, the world can't go on without trade. It's just that it will become more transactional at a multi-dimensional level....