Xi and Putin's First 2025 Call Signals 'Grand Plan' for Deepening Ties

Chinese President Xi Jinping and Russian President Vladimir Putin held their first video call of 2025 on Wednesday, with Xi declaring that bilateral relations were on the "right trajectory" and emphasizing the need for a "grand plan" to develop ties further.

Beyond Diplomatic Pleasantries

This wasn't just another routine diplomatic exchange. Putin's assessment that China-Russia ties serve as a "stabilizing factor" during global turbulence reveals the strategic calculus behind their partnership. As both nations face mounting pressure from Western sanctions and containment efforts, their cooperation has evolved from convenience to necessity.

The timing is particularly significant. With Donald Trump returning to the White House and European nations grappling with their own economic challenges, Beijing and Moscow see an opportunity to reshape global power dynamics. Xi's call for a "grand plan" suggests they're moving beyond tactical cooperation toward systematic strategic alignment.

Economic Interdependence Deepens

The numbers tell the story. China-Russia trade reached $240 billion in 2023, with energy forming the backbone of their economic relationship. Russia has become China's largest oil supplier, while Chinese technology and manufacturing goods flow in the opposite direction. This interdependence creates a buffer against Western economic pressure.

But there's more at stake than trade figures. Both countries are developing alternative financial systems to reduce dependence on Western-dominated institutions. Russia's exclusion from SWIFT and China's concerns about potential CHIPS Act-style restrictions are driving innovation in payment systems and supply chains.

The Limits of Partnership

Yet this isn't a marriage of equals, nor is it without friction. China remains cautious about directly supporting Russia's war in Ukraine, walking a careful line between solidarity and self-preservation. Chinese companies have largely complied with Western sanctions, even as Beijing provides diplomatic cover for Moscow.

Russia, meanwhile, harbors concerns about becoming too dependent on its larger neighbor. Historical tensions over Siberian territories and Central Asian influence haven't disappeared—they've simply been shelved for mutual convenience.

Global Implications

For the rest of the world, this partnership poses complex challenges. Middle powers like South Korea, India, and Turkey must navigate between competing blocs while protecting their own interests. The era of clear-cut alliances is giving way to more fluid, interest-based partnerships.

Investors are watching closely too. Companies with significant exposure to either China or Russia face difficult choices about supply chains, market access, and regulatory compliance across different jurisdictions.