India, Oct. 9 -- America's imposition of sharp tariff hikes on Indian exports has led to an unexpected rapprochement between India and China, one that has momentous global geopolitical and geoeconomic implications. Against the backdrop of a rather unexpected disorder in trade relations between India and the US, this provides significant tailwinds to a Global South agenda where two of its most populous stakeholders are looking to find ways of working together as the multilateral order suffers serious fractures. India's strategy of engagement with China must provide the policy space for both countries to achieve shared goals and impart resilience to a Global South agenda that can navigate the realities of the disrupted global order. There are three key realities that need to be factored in. China's approach to the Global South has revolved around a strategy of financial investments and loans through State and private actors. This has done reasonably well in reducing the receiving countries' dependence on Western finance, especially in the infrastructure and energy sectors. This has given China a geopolitical stature that serves its interests well. However, the Chinese-financing approach has limited utility in a pragmatic strategy of engagement with India, a democratic country with its own geopolitical needs and ambitions and its suspicions regarding the China Pakistan Economic Corridor and the Chinese adventures around the Belt and Road Initiative. India's own ability to attract global finance is significant. The country has been making tremendous infrastructure and energy investments over the last decade and has a robust capital market of its own. This provides limited avenues for absorbing Chinese finance through pathways deployed in other Global South arenas. Therefore, Chinese financing must evolve beyond the strategy of infrastructure and energy investments to create the necessary policy space for coherent engagement between these countries. A strategy of engagement between India and China must also understand the moment in India's trajectory of structural transformation. Over the last few years, there has been a consolidation of conviction at the highest levels of the Indian government on pursuing a manufacturing-led trajectory of structural transformation, one that focuses on addressing India's rapidly expanding consumption needs and developing an export-strategy that imparts resilience to its macro-economic stability. From Make in India to Production Linked Incentives to the upcoming National Manufacturing Mission, the government couldn't make its manufacturing ambitions clearer. India and China must engage with each other in a way that centres the potential of manufacturing on achieving shared goals. Manufacturing across sectors provides significant potential. This includes green energy where China's advantage, particularly in solar, wind, electric vehicles (EVs), and batteries, is absolute. Engagement between India and China must centre the ability of firms across the two countries on finding ways to work together and building productive capacity. Chinese firms are at a technological frontier that is aspirational for a large number of Indian firms. By creating the policy space where Indian and Chinese firms can work together to address shared goals, both India and China can solve a first-order problem that has often plagued the ability of Indian firms to leverage their core competencies. This has often revolved around their inability to address bottlenecks in supply chains, work-force training, and technology transfers. A certain kind of inertia and political wariness on both sides has only exacerbated these constraints in scaling up a partnership. This wariness has significant negative spillovers on the ability of Chinese firms, especially in the green sector, to make inroads into building manufacturing capacity in India. While Chinese EV-maker BYD's attempts at participating in India's growing EV market through actual investment commitments on productive capacity in India have been cold shouldered, Tesla, on the other hand, has received a red carpet without any immediate plans of production in the country. The divergent experience of Tesla and BYD in India has key lessons on how engagement-strategies must address suspicions. But there are also examples that show tremendous possibilities of joint projects. JSW (Jindal Steel Works) recently entered into a joint venture with the Chinese State-owned automobile manufacturer SAIC Motor to make inroads into India's EV market. The joint venture between SAIC Motor, a global leader in EV battery manufacturing, and JSW, to sell EVs in India under the MG brand has significantly disrupted the market in India, with MG Windsor becoming India's fastest-selling EV. This must be seen as the kind of Schumpeterianism that can energise India's EV market and create possibilities of supply-chain coordination and technology transfers - moving India up the technology ladder and expanding the basket and quality of EVs for Indian consumers. The ball seems to have been set in motion already. The recently announced collaboration between Ashok Leyland, one of India's premier commercial vehicle companies, and CALB, a Chinese battery manufacturer, for developing and manufacturing next-generation batteries in India is welcome. Similar strategies of joint ventures and collaborations between Indian and Chinese firms need to be deployed across sectors and at scale. China must see its unparalleled technological frontier as a source of synergy with India. India, on the other hand, must find ways to allow these synergies to unfold. If the elephant is to indeed dance with the dragon and achieve shared goals and impart resilience and agency to a Global South mandate, India and China must build on this moment of unexpected opportunity....