Morning Brief: China’s Push To Unite Pakistan, Afghanistan Begins To Unravel; India-US Trade Talks Deadlocked; Industrial Growth Slows To Nine-Month Low; And More

Kick-start your morning with Swarajya’s Morning Brief – your news fix, curated for clarity and insight.

China’s Push To Unite Pakistan, Afghanistan Begin To Fall Apart

Tensions are flaring along the Afghanistan–Pakistan border after a deadly suicide bombing targeted a Pakistani army convoy in North Waziristan’s Mir Ali region on Saturday. Following the attack, Pakistan abruptly shut the Ghulam Khan border crossing, a crucial trade route, without offering any explanation. Travellers and traders have been advised to use alternate crossings like Torkham or Spin Boldak.

The closure comes embarrassingly soon after China hosted a trilateral dialogue with Pakistan and Afghanistan, aimed not at peacebuilding but at strategically bridging their differences to sideline India. Beijing also helped Islamabad secure the chair of the UN sanctions committee on the Taliban, strengthening Pakistan’s ability to shield Taliban factions aligned with its interests. But the sudden flare-up threatens to derail China’s effort to unite Afghanistan and Pakistan in order to sideline India.

India-US Trade Talks Deadlocked Ahead Of Tariff Deadline

Indian trade negotiators have extended their stay in Washington in a final effort to clinch an interim trade deal before the US pause on reciprocal tariffs expires on July 9. The talks have taken on added urgency after the US concluded a trade agreement with China—negotiations that began later than those with India but moved faster.

While India is pushing for the removal of additional US tariffs on items like steel, aluminium, and auto parts, Washington is demanding broader access to Indian markets, including for genetically modified crops and dairy products. These demands run into what Indian officials have called “red lines,” especially in agriculture. Despite public optimism from US President Donald Trump, resistance from domestic groups like the Swadeshi Jagaran Manch has made the path to a deal politically sensitive.

Industrial Growth Slows To 9-Month Low

India’s industrial output growth fell to a nine-month low of 1.2 per cent in May, dragged down by contractions in electricity and mining, and continued weakness in manufacturing. The Index of Industrial Production (IIP) had risen by 2.6 per cent in April and 6.3 per cent in May last year, but a weaker performance this time signals stress in the sector amid global uncertainties.

Electricity output fell 5.8 per cent, while mining slipped 0.1 per cent. Both were hit by the early onset of the monsoon. Manufacturing grew just 2.6 per cent, down from 5.1 per cent last year. Capital goods were a bright spot, rising 14.1 per cent on a low base, but three out of six use-based categories saw contraction.

Other Developments

China’s Manufacturing Slump Continues

China’s manufacturing sector contracted for the third straight month in June, with the official purchasing managers’ index (PMI) rising slightly to 49.7 from 49.5 in May—still below the 50-point mark that signals growth. The modest uptick came amid tepid domestic demand and a fragile export environment, with the new export orders sub-index barely improving to 47.7.

While the broader non-manufacturing PMI edged up to 50.5, indicating modest growth in services and construction, factory owners remain cautious as a prolonged property slump and deflationary pressures weigh on consumer spending. Industrial profits fell 9.1 per cent year-on-year in May, deepening concerns about Beijing’s ability to revive demand and maintain momentum toward its 2025 growth target of “around 5 per cent.”

Dalai Lama To Address Succession Amid China Tensions

Dharamshala: The Dalai Lama is expected to speak on his succession during a major three-day Buddhist gathering this week, days before his 90th birthday. Followers anticipate he may offer clues about where his next incarnation could be found—a move that could heighten tensions with China, which insists it will name his successor.

The exiled Tibetan leader has long rejected Beijing’s claim, saying his reincarnation will be born outside China. On Monday, he told followers he would devote the rest of his life to serving others and hinted at a framework for continuing the Dalai Lama lineage.

Elon Musk has threatened to unseat lawmakers who support Donald Trump’s massive tax and immigration package, calling it “insane and destructive.” The $4.5 trillion “One Big Beautiful Bill” aims to extend Trump’s tax cuts, boost military spending, and fund mass deportations, but critics say it would gut welfare programs and add over $3 trillion to the national debt.

Musk warned on X that any member backing the bill “will lose their primary” and floated launching a new “America Party” if it passes. The Senate, where Republicans hold a slim majority, is racing to approve the bill before Independence Day. Meanwhile, a social media feud between Musk and Trump has escalated, adding political drama to an already tense vote.

From The States

Telengana: BJP's Raja Singh Quits Over New State Chief

Hyderabad: Telangana BJP MLA T Raja Singh resigned from the party after his nomination for state president was rejected and N Ramchander Rao emerged as the unopposed candidate. Singh alleged his supporters were threatened and called Rao’s appointment a betrayal of grassroots workers.

The move has exposed internal cracks in the BJP, where several leaders had been eyeing the top post. Singh, a three-time MLA known for his hardline Hindutva stance, said he would stay committed to the ideology and continue serving his Goshamahal constituency. Rao dismissed talk of factionalism, saying the party remains united on ideology.

Surjewala Meets Karnataka MLAs Amid Congress Power Struggle

AICC general secretary Randeep Singh Surjewala has begun meeting Karnataka Congress MLAs and MLCs as tensions simmer between Chief Minister Siddaramaiah and his deputy D K Shivakumar. His three-day visit aims to assess discontent within the party and address concerns over governance, factionalism, and recent poll setbacks.

Party insiders say the outreach is meant to gauge opinion on a possible Cabinet reshuffle, though the Congress high command has denied any immediate leadership change. Speculation over a term-sharing deal between Siddaramaiah and Shivakumar has been circulating for months. Surjewala’s meetings follow public criticism from senior MLAs, whose allegations of corruption have fueled attacks from the BJP and JD(S).

BJP Moves Closer To Picking National President

The BJP is set to appoint several new state unit chiefs on Tuesday, crossing the halfway mark required to elect a new national president under its constitution. With J.P. Nadda on an extended term since June last year, party leaders and the RSS are now said to be closing in on a consensus for his successor.

State presidents have already been elected in Puducherry and Mizoram, with uncontested nominations filed in Maharashtra, Uttarakhand, Telangana, and Andhra Pradesh. More appointments are expected in big states like Karnataka and Madhya Pradesh in the coming days, possibly followed by a Union Cabinet reshuffle.

Setback For INDIA Bloc Ahead Of Mumbai Civic Polls

A section of Maharashtra Congress leaders has urged the party to contest the upcoming Brihanmumbai Municipal Corporation (BMC) elections alone, fearing it could be sidelined if it remains in alliance with the Shiv Sena (Uddhav) and the NCP (Sharad Pawar) under the Maha Vikas Aghadi (MVA). At a meeting in Delhi on Monday, leaders argued that minority votes were drifting toward Uddhav’s Sena.

The Congress now faces a dilemma, though it may be spared a tough decision as the Uddhav Sena has also expressed its intention to contest the polls independently. The BMC, one of India’s richest civic bodies, is expected to go to polls later this year or early next. Congress, which won just 31 of 227 seats in the 2017 BMC polls, is trying to regain relevance after the MVA’s poor performance in assembly elections.

You’re all caught up—until next time.