File this one under "the decreasing relevance of the US as the world's single economic superpower". According to India's Economic Times, China will soon surpass the US as India's largest trading partner (World Trade Magazine gets the hat-tip for finding this story). According to the article, "A Chinese official said that in 2007, total trade volume between India and China had touched $38.5 billion and was growing at a rate of close to 50% ... India's trade with the US may be marginally more than that but is growing at less than 20%, and with the slowdown in the US economy intensifying, it could decelerate further." As I read stories likes this, it strikes me as further proof that global sourcing and global trade is about serving the needs of growing markets -- not simply looking for short-term East/West labor cost arbitrage opportunities. Indeed, provided that India and China can avert tariffs and trade quibbles between themselves, there's no reason that the two Asian economies will not become increasingly intertwined in the years to come.
- Jason Busch