The recent formation of the US-led Pax Silica initiative, a strategic alliance to secure supply chains in critical minerals, semiconductors, energy, and artificial intelligence, sent a clear signal about the new rules of global power. Notably, India was not among the nine member nations, nor was it even listed as an invited guest. This exclusion, as argued by economist Dhiraj Nayyar in a January 3, 2026 analysis, is not a diplomatic snub but a stark reflection of India's decades-long inattention to high-technology capabilities and mineral resource development.
The Transactional Reality of Modern Geopolitics
The Pax Silica group, announced during the tenure of US President Donald Trump, includes the United States, Japan, South Korea, Singapore, the UK, the Netherlands, Israel, the UAE, and Australia. Each member brings either cutting-edge technological prowess or significant natural resources to the table. Guest participants like Taiwan (semiconductors) and Canada (resources) also have clear strategic offerings.
In this transactional world of great power politics, India currently finds itself with limited leverage. The initiative, widely seen as a move to counter China's dominance, logically bypassed India because, in the crucial areas of semiconductors, AI, and energy minerals, India does not yet bring substantial assets to the alliance. This gap is a direct outcome of policy choices stretching back decades.
The Twin Deficits: Stagnant R&D and Unexplored Geology
The statistics on India's research and development investment are revealing and stagnant. For over twenty years, India has spent merely 0.6% to 0.7% of its GDP on R&D. This pales in comparison to the United States (3%), China (2.5%), or leaders like South Korea and Israel, which invest close to 5% of their GDP. Consequently, India has not transformed into a product or innovation powerhouse, with its space sector being a notable but isolated exception.
A parallel story of underperformance unfolds in the minerals sector. Despite possessing geology comparable to resource-rich Australia, India has explored only 25-30% of its mineral potential. The country remains heavily import-dependent: over 90% for oil and gas, 99.9% for gold, 95% for copper ore, and even for seemingly abundant minerals like coal and bauxite. For critical minerals like lithium, the import reliance is a staggering 100%. Mining contributes a mere 2% to India's GDP, a figure that has seen little growth, unlike the 8-10% contribution seen in geologically similar nations.
Charting a Path Forward: From Potential to Delivery
The policy focus in minerals has historically been on allocation and revenue generation post-discovery. The greater challenge, however, lies in the exploration phase. To unlock the wealth lying undiscovered underground, India needs a new policy framework that actively brings in the private sector. This would require allowing companies to freely monetize discoveries without excessive government intervention, creating the incentive for large-scale exploration investment.
Nayyar suggests that India's other potential avenue for global relevance is its vast domestic market. Leveraging this market access could attract transactional interest from the US and other economies. However, the prevailing political reality and the difficulty of domestic reform lean towards protectionism, as evidenced by the prolonged negotiations for a US trade deal.
India's time on the global high table will come, but it hinges on moving from potential to delivery. Today's geopolitics rewards actual capability, not promise. The exclusion from Pax Silica should serve as a catalyst for urgent action. By significantly boosting R&D expenditure and aggressively exploring its mineral riches, India can accelerate its journey to becoming an indispensable player in the new geo-economics, ensuring its strategic relevance is recognized sooner rather than later.
