SCO Summit 2025: 5 Big Achievements That Will Reshape Global Trade and Diplomacy

SCO Summit 2025: In a world grappling with geopolitical tensions, trade wars, and shifting alliances, the SCO Summit 2025 in Tianjin, China, emerged as a pivotal moment. Held from August 31 to September 1, 2025, this summit brought together leaders from Asia, Europe, and Africa, representing over 40% of the global population. With escalating U.S. tariffs and sanctions impacting nations like China, India, and Russia, the Shanghai Cooperation Organisation (SCO) showcased its potential to redefine global trade and diplomacy. This article explores five transformative achievements from the SCO Summit 2025, their implications for the global economy, and how they address the needs of a multipolar world. From trade innovations to diplomatic breakthroughs, these outcomes signal a new era of cooperation.

What Is the SCO Summit 2025?

The SCO Summit 2025 marked the 25th meeting of the Shanghai Cooperation Organisation, a regional bloc founded in 2001 by China, Russia, Kazakhstan, Kyrgyzstan, Tajikistan, and Uzbekistan. Over time, it expanded to include India, Pakistan, Iran, and Belarus, with 14 dialogue partners like Turkey and Saudi Arabia. Representing 42% of the world’s population and 23% of global GDP, the SCO focuses on security, economic cooperation, and cultural ties. Hosted in Tianjin, a key port city, the summit underscored China’s leadership in fostering Eurasian connectivity and countering Western-dominated frameworks.

Historical Context of the SCO

The SCO evolved from the Shanghai Five in 1996, initially focusing on border security. By 2001, it became a platform for broader cooperation, addressing terrorism, trade, and regional stability. The 2025 summit was the largest yet, with over 20 world leaders, including China’s Xi Jinping, India’s Narendra Modi, and Russia’s Vladimir Putin. This gathering highlighted the SCO’s growing influence amid global challenges like U.S. tariffs and the Russia-Ukraine conflict.

5 Major Achievements of the SCO Summit 2025

The SCO Summit 2025 delivered concrete outcomes that promise to reshape global trade and diplomacy. Below, we explore five key achievements, their significance, and their potential impact.

1. Yuan-Based Trade Initiatives to Challenge Dollar Dominance

One of the summit’s boldest moves was China’s push for yuan-backed trade settlements. Beijing proposed using stablecoins and digital currencies for cross-border transactions, aiming to reduce reliance on the U.S. dollar-dominated SWIFT system. This aligns with the SCO’s vision of a multipolar financial order.

• Why It Matters: With SCO member states accounting for 17.5% of global trade (up from 5.4% in 2001), yuan-based trade could weaken Western financial hegemony.
• Real-World Impact: Iran and Russia, both under U.S. sanctions, have already piloted yuan-based oil trades. This could expand to other SCO members, stabilizing their economies.
• Challenges: Internal divides, such as India’s cautious approach to anti-Western policies, may slow adoption.

Table 1: Comparison of Dollar vs. Yuan-Based Trade Systems

2. Resumption of India-China Bilateral Ties

The summit marked a historic reset in India-China relations, with Prime Minister Narendra Modi’s first visit to China since 2018. A bilateral meeting with Xi Jinping resulted in agreements on border troop withdrawals, visa resumption, and direct flight connectivity. The Kailash Mansarovar Yatra, a symbolic pilgrimage, was also reinstated.

• Diplomatic Significance: These steps follow tensions from the 2020 Galwan Valley clash. The summit’s optics signal a cautious détente, vital for regional stability.
• Trade Implications: Restoring direct flights and visas could boost India-China trade, valued at $136 billion in 2024, by easing business travel and cultural exchanges.
• Case Study: The resumption of the Kailash Mansarovar Yatra reflects people-to-people diplomacy, fostering trust at the societal level.

3. SCO Development Bank Institutionalization

The summit advanced plans to establish the SCO Development Bank, a long-discussed initiative to fund infrastructure, trade, and green projects. China and Russia championed this to counter Western-dominated institutions like the World Bank.

• Economic Impact: The bank could finance projects like energy corridors and digital customs systems, enhancing SCO’s trade infrastructure.
• Comparative Advantage: Unlike the World Bank, the SCO bank would prioritize Eurasian connectivity, aligning with China’s Belt and Road Initiative (BRI).
• Challenges: India’s reluctance to fully endorse BRI projects may limit the bank’s scope.

Table 2: SCO Development Bank vs. World Bank

4. Strengthened Regional Security Frameworks

The SCO’s Regional Anti-Terrorist Structure (RATS) was bolstered with plans for deeper security drills, including drone and robotics-based counter-terrorism exercises. The summit also adopted the Program of Cooperation in Countering Terrorism, Separatism, and Extremism for 2025–2027.

• Why It Matters: With instability in Afghanistan and Central Asia, RATS strengthens collective security against terrorism and cyberattacks.
• Real-World Example: The 2024 Astana summit’s counter-terror drill set a precedent, with 2025 exercises expected to integrate advanced technology.
• Limitations: Tensions between India and Pakistan, evident in India’s refusal to endorse a joint statement in June 2025, highlight challenges in unified action.

5. Draft SCO Development Strategy for the Next Decade

The summit unveiled the Draft SCO Development Strategy for the Next Decade, focusing on digital customs systems, pooled development funds, and sustainable growth. This strategy aims to transform the SCO from a diplomatic forum into a results-driven organization.

• Key Components:
  • Harmonized digital customs to streamline trade.
  • Joint oversight mechanisms for transparency.
  • Green industries and digital economy initiatives.
• Global Impact: By fostering connectivity and innovation, the SCO could bridge economic gaps across Eurasia, benefiting smaller members like Kyrgyzstan and Tajikistan.
• Example: The SCO University, a student exchange program, has already fostered cultural ties, setting a model for broader cooperation.

SCO Summit 2025: How These Achievements Impact Global Trade and Diplomacy

The SCO Summit 2025 achievements signal a shift toward a multipolar world. Yuan-based trade challenges Western financial dominance, while the SCO Development Bank offers an alternative to traditional institutions. The India-China reset could stabilize South Asia, a region critical to global supply chains. Enhanced security frameworks address pressing threats, and the decade-long strategy positions the SCO as a proactive player in global governance.

• Trade Growth: SCO’s trade share grew from 5.4% in 2001 to 17.5% in 2020, and these initiatives could push it higher.
• Diplomatic Leverage: The summit’s optics, with leaders like Modi, Xi, and Putin, counter U.S.-led narratives of isolation.
• Challenges Ahead: Internal divides, particularly between India and Pakistan, and India’s strategic autonomy, may limit cohesive action.

Real-World Implications for Businesses and Governments

For businesses, the SCO’s focus on digital customs and yuan-based trade opens opportunities in Eurasian markets. Governments, especially in Central Asia, gain access to funding and security cooperation, reducing reliance on Western aid. However, navigating the SCO’s complex dynamics requires strategic diplomacy, as India’s cautious approach demonstrates.

• Internal Link: Learn more about India’s role in global trade.
• External Link: World Trade Organization on global trade systems.
• Internal Link: Explore China’s Belt and Road Initiative.
• External Link: Council on Foreign Relations on global trade shifts.

FAQ Section: Understanding the SCO Summit 2025

1. What Was the Main Focus of the SCO Summit 2025?

The SCO Summit 2025, held in Tianjin, China from August 31 to September 1, primarily focused on fostering a multipolar world order through enhanced regional cooperation. Leaders from 27 nations, including 10 full member states, aimed to reshape global governance by promoting economic integration, security collaboration, and sustainable development. Chinese President Xi Jinping emphasized rejecting “Cold War mentality” and “bloc confrontation,” advocating for a “just and balanced” international framework. The summit prioritized trade, counter-terrorism, and technological innovation, with initiatives like the SCO Development Bank and new cooperation platforms in energy, digital economy, and artificial intelligence. The Tianjin Declaration outlined a 2026-2035 development strategy, reinforcing the SCO’s ambition to challenge Western-dominated institutions.

2. How Does the SCO Summit 2025 Impact Global Trade?

The SCO Summit 2025 significantly impacts global trade by fostering economic integration among its 27-nation family, representing nearly half the world’s population and 25% of global GDP. China’s trade with SCO members reached $890 billion in 2024, and the summit’s outcomes, including the establishment of an SCO Development Bank, aim to boost infrastructure and economic progress. New platforms for energy, green industry, and digital economy were introduced, aligning with China’s Belt and Road projects. These initiatives counter U.S. tariffs, like the 50% levy on Indian goods, by promoting a multilateral trading system. The SCO’s focus on maritime trade routes also enhances regional connectivity, potentially reshaping global trade dynamics.

3. Why Was India’s Participation in the SCO Summit 2025 Significant?

India’s participation in the SCO Summit 2025 was pivotal due to its strategic meeting between Prime Minister Narendra Modi and Chinese President Xi Jinping, their first on Chinese soil in seven years. Representing 2.8 billion people, both leaders emphasized partnership over rivalry, addressing border disputes and U.S. tariffs. The summit’s Tianjin Declaration condemned the Pahalgam terror attack in India, signaling SCO’s support for India’s security concerns. India’s role strengthens the SCO’s geopolitical weight, balancing China and Russia’s influence while advocating for multipolarity. This engagement enhances India’s global diplomatic clout and fosters economic cooperation, aligning with SCO’s vision for a balanced world order.

4. What Role Does the SCO Development Bank Play?

The SCO Development Bank, established at the 2025 Summit, plays a critical role in boosting economic and social progress among member states. It aims to fund infrastructure projects, enhancing connectivity and trade across Eurasia. Backed by China’s $280 million in grants and $1.4 billion in loans through the SCO Interbank Consortium, the bank supports sustainable development and counters Western financial dominance. By aligning with Belt and Road initiatives, it facilitates cross-border projects in energy, transportation, and digital infrastructure. This financial institution strengthens the SCO’s economic influence, offering an alternative to Western-led institutions like the IMF, fostering regional self-reliance and global trade integration.

5. How Does the SCO Address Security Concerns?

The SCO Summit 2025 addressed security concerns by inaugurating four new centers focused on countering security threats, transnational organized crime, information security, and anti-drug cooperation. The Tianjin Declaration condemned terrorism, specifically referencing the Pahalgam attack in India, and outlined a 2026-2030 program to counter extremist ideologies. The SCO’s security framework emphasizes regional stability, countering terrorism, separatism, and extremism, rooted in its 2001 founding principles. By fostering joint actions and confidence-building measures, the SCO strengthens Eurasian security. These initiatives position the SCO as a counterbalance to Western security alliances, promoting a non-Western approach to global stability amid rising geopolitical tensions.

6. Can the SCO Rival Western Alliances Like NATO or the G7?

The SCO’s expansion to 27 nations and its focus on economic and security cooperation position it as a potential rival to Western alliances like NATO and the G7. Covering nearly half the world’s population and 25% of global GDP, the SCO’s Tianjin Summit showcased its ambition to reshape global governance. Its non-ideological “Shanghai Spirit” of mutual trust and shared development contrasts with Western bloc confrontations. However, the SCO’s diverse membership and lack of ideological uniformity may limit its cohesion compared to NATO’s military focus or G7’s economic alignment. While not yet a direct rival, the SCO offers a viable alternative for multipolar governance.

7. What Are the Challenges Facing the SCO Post-Summit?

Post-summit, the SCO faces challenges in maintaining cohesion among its diverse 27-nation membership, including rivalries like India-China border disputes. Implementing the ambitious 2026-2035 Development Strategy and operationalizing the SCO Development Bank require significant coordination and funding. Resistance from Western institutions, particularly in response to the SCO’s push against U.S.-led trade policies, could hinder its global influence. Additionally, balancing China’s dominant role with other members’ interests risks internal friction, as Russia plays a junior role. The SCO must also navigate global turbulence, including U.S. tariffs and geopolitical conflicts, to sustain its momentum in reshaping trade and diplomacy without succumbing to external pressures.

Conclusion

The SCO Summit 2025 in Tianjin has set a bold course for global trade and diplomacy. From yuan-based trade to the SCO Development Bank, these achievements challenge Western dominance and foster Eurasian connectivity. The India-China reset and enhanced security frameworks signal pragmatic cooperation, while the decade-long strategy ensures long-term impact. Despite internal challenges, the SCO’s growing influence—representing 42% of the world’s population—makes it a force to watch. How do you think these developments will shape global trade? Share your thoughts below or subscribe to our newsletter for more insights!