India's Economic Resilience Meets Influence Challenge in Latest Survey
The Economic Survey 2025-26, presented before Parliament on Thursday, paints a nuanced picture of India's global positioning. While acknowledging the nation's strong resilience and absorptive capacity against global shocks, the document emphasizes a crucial transition ahead: moving from being a recipient of stability to becoming a source of stability and opportunity for others.
Reclaiming Major Power Status with a Caveat
According to the Lowy Institute's Asia Power Index 2025, India has reclaimed its status as a major power in Asia, scoring 40 points. This achievement places the country third in overall regional power rankings. However, this rising profile starkly contrasts with its performance in specific domains, revealing what analysts term a significant power gap.
The index introduces a critical metric: the Power Gap, which measures whether a nation punches above or below its weight by comparing available resources to actual influence exerted. India's Power Gap stands at -4.0, indicating that its considerable resources are not yet fully translating into proportional regional influence. Countries with positive gaps wield outsized influence, while those with negative gaps, like India, exert less sway than their resource base would suggest.
Economic Relationships: A Mixed Bag of Progress and Potential
A closer look at the sub-indices reveals the complexity of India's position. Despite its third-place overall ranking, India languishes at 10th place in economic relationships. This underperformance highlights a disconnect between economic heft and diplomatic or trade influence within Asia.
Yet, there is a notable silver lining. For the first time since the index's inception in 2018, India's ranking in economic relationships has shown improvement. More significantly, the country has overtaken China to become Asia's leading destination for inward investment after the United States, measured on a 10-year cumulative basis. This shift is attributed to geopolitical supply chain diversification and India's growing attractiveness to global capital.
The Path from Resilience to Interdependence
The Economic Survey frames this context within India's broader developmental journey. "This transition from resilience to interdependence is central to India's journey towards Viksit Bharat," the document states. It underscores that future influence will hinge on competitiveness, export capability, and deep integration into regional and global production networks, especially in a fragmented world.
The survey notes that India's overall score of 40 and its expected score of 44 are more balanced when compared to top overachievers like Japan, which scores 38.8 overall against an expected 27.5. This comparison suggests that while India's power is undeniable, the critical question remains: how effectively will this power be wielded to bridge the influence gap?
The findings present a dual narrative: one of reclaimed status and economic opportunity, and another of untapped potential. As India navigates its next phase of development, converting resources into sustained regional influence will be paramount.
