The growing irrelevance of India on the global stage

RN Bhaskar

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On 6 April, full four days after US President Trump announced sweeping tariffs for all countries exporting goods to the US, Piyush Goyal and his team were ensconced in the US waiting for the US government to ease conditions for India.  They appear to be there since then. There appears to be no effort to find alternative markets for India’s goods that were being exported to the US.  There is no information about any team being sent to the ASEAN countries, especially to Indonesia, Malaysia, and Thailand, which have large consumer markets.

In USA we trust

Instead, Goyal advised patience.  He wanted no immediate reaction.  He was hopeful that his team could melt Trump’s heart. Fanciful notions indeed.

So while the prime minister of Singapore went on the airwaves, exhorting his countrymen to be ready for touch times, even though his country had chosen not to impose retaliatory tariffs (https://www.youtube.com/watch?v=G0swAZQeZRc).  He asked his people to start exploring new markets and newer ways to deal with worsening trade movement, and the impending recession. India chose to keep quiet on this subject.

US, not China?

India chose instead to keep depending on the US. On the contrary. Goyal exhorted Indian businessmen to identify products where US goods could be chosen over Chinese goods (https://indianexpress.com/article/business/economy/identify-areas-where-us-goods-can-be-chosen-over-china-govt-asks-industry-9885713/).

To make matters worse, he has also stated that Chinese car maker BYD can wait and has expedited clearances for Tesla (https://www.livemint.com/auto-news/india-cautious-of-chinese-strategic-investments-blocks-byd-co-while-courting-rival-tesla-auto-news-business-piyush-goyal-11744085792530.html). At a time when other countries are wooing other business partners and diversify away from the US, India appears to be keen on becoming a vassal of the US.  Moreover, shouldn’t the focus be on what customers want, and not what government officials compel customers to want?

Becoming supplicants

Consider the way, it has chosen to move quickly on reducing spectrum charges to facilitate the entry of Musk’s Starlink, or Apple’s partner Globalsat for satellite-based communications.

Also consider the way Goyal has tried to debunk Indian businessmen’s fears about the consequences of US tariffs (free subscription — https://bhaskarr.substack.com/p/the-russian-bear-looms-large). Goyal stated that trade talks with the US continue, and that the burden on India was “not humongous”.

Experts reckon the burden to be over $5.76 billion (https://timesofindia.indiatimes.com/business/india-business/indias-exports-to-us-could-face-5-76-billion-decline-in-2025-due-to-tariff-hikes/articleshow/120059905.cms).  Now add this to India’s trade deficit of $14 billion in February 2025 (https://www.thehindu.com/business/Economy/indias-goods-trade-deficit-at-a-42-month-low-on-reduced-gold-silver-and-crude-imports/article69341513.ece).  A $5.76 billion increase would mean a surge of 30% in the trade deficit.  At what level will the losses become “humungous” for the minister?

Opening doors wide for US imports?

Consider also the way Prime Minister reportedly agreed to more than quintuple bilateral trade with the US to $ 500 billion (https://www.youtube.com/watch?v=qkljQD0e8AU&t=1s).  Modi apparently even agreed to buy defence equipment from the US, including F-35 aircraft, even though they have not performed well in the Ukraine war or the clash between Israel and Iran.  It may be recalled that Iranian missiles managed to destroy the world’s most heavily guarded military airfield at Nevatim in Israel bypassing all interception (Free subscription — https://bhaskarr.substack.com/p/the-russian-bear-looms-large).  Thereafter, Israel’s F-35s flew towards Iran to bomb Iran’s nuclear facilities, but turned back suddenly because their systems were compromised by that country’s defences. Now, India wants to purchase the same equipment that failed on these battlefields.

Are Goyal and the prime minister determined to sell away India’s interests?  Could it be because they along with the country’s key policymakers are being blackmailed by the US as alleged by Sergey Lavrov in a public meeting in India in November 2023 (Free subscription — https://bhaskarr.substack.com/p/the-indian-government-has-inflated).

New East India Company avatar?

Is India going to see the US become another East India Company. Is India to get colonised by the US?

It would appear to be so (https://www.youtube.com/live/3B5Mi_oHGRY?si=9E8FHo8ENaIBGQoB).  Just look at the indicators:

• India is willing to play supplicant to the US;
• It refused to endorse an alternative currency at the BRICS summit last year;
• It has refused to work on alternate plans to create new markets for Indian goods in order to cope with the US imposition of tariffs;
• Its willingness to allow more import of US goods and services into India;
• Its exhortation to Indian businesses to find out more goods that can be imported from the US;
• And its willingness to allow import of more expensive Tesla cars instead of a cheaper and more popular cars from global leader BYD.

All these point to a government that is willing to sell India’s interests down the drain, and not stand up to bullying.  The latter is what almost the entire world has done.

Is India willing to become the US poinsman in Asia even at the risk of becoming another Ukraine?  Does it not recall the famous words of Henry Kissinger, that to be an enemy of the US may be dangerous; but to be a friend is fatal?

Canada retaliated with a fresh set of tariffs which rattled the US government and consumers (https://www.facebook.com/reel/1368031624244413). Trucks bound from the US to Alaska were also slapped with tariffs (https://www.bloomberg.com/news/articles/2025-03-06/trump-tariffs-on-canada-mean-new-fees-for-alaska-bound-trucks) making the land route extremely expensive for the US.  Europe retaliated by banning US imports. Consumers in countries like Canada and Denmark boycotted goods from the US.

India, however, chose to sit quiet.  For a country that likes railing against China, Pakistan, Malaysia and Turkey at the slightest provocation, this meekness was unexpected and out of character.

Goyal’s contrasting approaches

The most baffling, even sad, is the manner in which Goyal has led his team to adopt a supine posture with the US.  Compare that with the belligerence with which he addressed his railway employees (https://www.ndtv.com/india-news/railways-asks-staff-to-give-up-privileges-exercise-restraint-at-home-1760143). Or the sleight of hand he adopted when pushing through the UDAY  scheme which he said would revive the power sector (https://asiaconverge.com/2018/09/discom-losses-continue-to-bleed-the-country/).  Everyone knew that the scheme would not work until the basics were address.  But Goyal wouldn’t listen.

The belligerence with which Goyal reportedly deals with his counterparts at the ASEAN is in sharp contrast with the body language and the demeanour when he meets officials from New Zealand or the US.

Now Goyal belies that the losses to be suffered by India on account of the US tariffs will not be “humungous”.  He needs to be reminded that the tariffs on autos and steel continue to be in force, despite the 90-day reprieve.  So are the 10% tariffs across the board.  Even they will hit India hard.

Hope isn’t enough

Maybe, India may get a good deal from Trump.  But how does one reach the $500 billion trade volume mark without more US imports?  And how does one explain the willingness to substitute imports from China with imports from the US.  Obviously, if businessmen wanted to import from China, they do so because they get a better deal from there.

And, finally, one more thing. Is it possible to play an even hand with both the US and China? That is the way even a small country like Vietnam manages and thrives  (Free subscription — https://bhaskarr.substack.com/p/is-india-spooked-by-china).  Vietnam deals with China and the US, with excellent bargains from both.  Why can’t India do the same, especially because it always touts its negotiating skills on the world stage?

As a result, India is getting marginalised.  Its voice in BRICS is getting weaker, even while Russia, China and Iran play a bigger role.  As a result, it is now being perceived as being weak and ineffectual – even as a global leader.

Either India is losing its vision or is being bullied into submission.  Neither is a good sign. This is not good for India, nor for its future generations.  The present course needs immediate correction.

The author is a senior journalist and researcher

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Do watch my latest podcast on India’s disastrous move to link Aadhaar with Voter ID cards at  https://youtu.be/TLkG2jpbQmY

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