'Up to China to step back': US Treasury Secretary Bessent on tariff war, signals first trade deal could be with India

Markets were already on edge when Treasury Secretary Scott Bessent raised the stakes, putting the burden for trade progress squarely on China. In an April 28 interview with CNBC, Bessent made it clear: Beijing must move first. "I believe that it’s up to China to de-escalate, because they sell five times more to us than we sell to them, and so these 120%, 145% tariffs are unsustainable," he said.

Bessent’s comments arrive at a tense moment, just weeks after President Donald Trump’s April 2 declaration of sweeping global tariffs jolted financial markets. Trump later moderated his stance, announcing he would maintain 10% tariffs across the board while delaying harsher measures against specific countries for 90 days.

Since then, negotiations have made headway, according to Bessent, who highlighted India as a frontrunner for a new agreement among 15 to 18 "important trading relationships" currently under discussion.

"We’ve had many countries come forward and present some very good proposals, and we’re evaluating those," he said. "I would guess that India would be one of the first trade deals we would sign. So, watch this space," Bessent added.

Beyond Asia, Bessent noted growing anxiety in Europe over currency dynamics fueled by trade uncertainty. The euro has strengthened nearly 10% against the US dollar this year, after flirting with parity in January — a development he said European leaders view with alarm.

"You’re going to see the (European Central Bank) start cutting rates to try to get the euro back down," Bessent said. "Europeans don’t want a strong euro. We have a strong-dollar policy."

Meanwhile, confusion persists about the status of talks with China. While Trump mentioned discussions with Chinese officials in Washington last week, reports suggest the meetings were unrelated to trade, coinciding instead with World Bank and IMF gatherings.

Bessent emphasised that the White House intends to keep negotiations private: "We will not be conducting negotiations in the press."