External Affairs Minister S Jaishankar delivered a stark assessment of the changing global order on Saturday, declaring that the world has entered an era where politics increasingly trumps economics. The minister's crucial remarks came as he received an Honorary Doctorate from IIM-Calcutta.
New Global Realities Demand Strategic Shift
Jaishankar emphasized that in this uncertain world, India must continuously diversify its supply sources to safeguard national interests. This is an era where politics increasingly trumps economics—and that is not a pun, he stated clearly during his address.
The minister highlighted significant changes in global power dynamics, noting that the United States, long the underwriter of the contemporary system, has now set radically new terms of engagement by dealing with countries individually. Meanwhile, China has long played by its own rules and continues to do so, creating additional complexities in international relations.
Trade Challenges and Supply Chain Security
Jaishankar's warnings come at a critical time for Indian exports. According to a GTRI report, Indian exports to the US saw a sharp 28.5% decline between May and October 2025 due to aggressive tariff hikes that pushed duties as high as 50% by late August.
The minister revealed that India and the US are currently engaged in two parallel negotiations—one focused on a framework trade deal concerning tariffs, and another on a more comprehensive agreement. This dual approach reflects the complex nature of contemporary trade relations.
Jaishankar highlighted several concerning global trends:
- One-third of global production currently takes place in China
- Increasing supply chain fragmentation and insecurity
- Growing risks of disruption from conflicts and climate events
- Nations increasingly hedging against uncertainties
India's Path Forward: Self-Reliance and Manufacturing
The External Affairs Minister asserted that India has been actively pursuing self-reliance and developing itself as a robust manufacturing base. We are now moving ahead, by any standards, he declared, noting that the gap with successful Asian economies is narrowing rapidly.
Jaishankar pointed to significant progress in critical infrastructure areas including:
- Highways and railway networks
- Aviation and port facilities
- Energy and power infrastructure
He emphasized that a major power like India must possess a strong industrial base, describing the Make in India initiative as reflecting a different mindset and greater ambition. The minister urged industries to build domestic supply chains even as India seeks a stronger role in global ones.
Regarding emerging technologies, including artificial intelligence, Jaishankar underscored the need to strengthen domestic capabilities and reduce vulnerabilities. He reiterated that India's foreign policy aims to expand the country's global footprint as it works toward becoming a developed nation by 2047.
The minister's comprehensive analysis paints a picture of a world in transition, where traditional economic principles are being overshadowed by political considerations, requiring nations like India to adopt more strategic and self-reliant approaches to international engagement and economic development.
