Global Economic Fortress Collapsed: How India’s Hidden Strength Is Becoming Its Saviour | World News
New Delhi: The “citadel” of the global economy has collapsed. The old rules no longer apply. Global supply chains have weakened. Many countries have had to rethink their external dependencies. India also faced similar challenges but managed to overcome them successfully. Shaktikanta Das, former governor of the Reserve Bank of India (RBI) and principal secretary to the prime minister, highlighted the reasons behind India’s resilience.
Speaking at the convocation ceremony of Gokhale Institute of Politics and Economics in Pune, he said India is poised to contribute almost one-fifth of global GDP growth. He noted that the country’s ability to withstand external shocks is based on strong domestic demand and thoughtful economic policies.
Das emphasized that India’s priority in free trade agreements with countries such as the USA is to protect the interests of its citizens while ensuring fair and balanced agreements.
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Speed and Durability
He emphasized that India has shown remarkable speed and resilience amidst global uncertainty. 85. Kalele Smarak, in his conference titled “Indian Economy in a Changing Global Order”, explained that the global economy is going through unprecedented uncertainty and structural change. For more than eighty years, globalization and free trade frameworks dominated international trade. Today, these systems face significant challenges.
Rapidly Changing Global Conditions
In the past, the world was seen as a single market. The countries aimed for unified economic integration. Now the situation has changed. Das explained that global economic and trade systems are falling apart. While established rules are constantly being questioned, new norms have yet to solidify.
Events such as the COVID-19 pandemic and the Russia-Ukraine war have accelerated the push for self-reliance.
The former RBI governor highlighted weaknesses in global supply chains that are forcing many countries to reconsider their external dependency. Countries are now prioritizing supply chain flexibility rather than just cost efficiency.
Strategic autonomy emerged as a top priority. The rise of regional trade agreements reflects this shift towards practical and flexible partnerships.
Why Did India Endure Crises?
Das attributed India’s success to structural reforms and the ‘Atmanirbhar Bharat’ (self-reliant India) approach implemented in the last decade. Strong domestic demand and prudent and comprehensive economic and fiscal policies have enabled India to face global shocks effectively.
The country is now in a position to contribute almost one-fifth of global GDP growth.
Das reiterated that India’s trade priorities focus on fair and balanced agreements that serve the country’s interests. Negotiations regarding free trade agreements with the USA and other countries are carried out with this principle in mind. India’s economic policies are designed to successfully withstand external shocks.
He added that structural changes in the global economy are also transforming trade rules. The world is no longer one single market. COVID-19 and the Russia-Ukraine war have encouraged countries to strengthen their supply chains and become more self-reliant. Countries now consider not only cost efficiency but also the reliability and robustness of their supply chains.
