S Jaishankar Highlights Politics Over Economics: India's Strategic Response to US-Led Trade Tensions and Global Supply Chain Challenges

US President Donald Trump and India's External Affairs Minister S Jaishankar. (File)

External Affairs Minister S Jaishankar stated on Saturday that politics increasingly "trumps" economics in today's world, and emphasized that amid global uncertainty, countries must diversify their supply sources to secure national requirements.

During his address at IIM-Calcutta, where he received an Honorary Doctorate, Jaishankar noted that the United States has established fundamentally new engagement parameters by approaching countries individually. He highlighted that India continues to actively pursue self-reliance while positioning itself as a manufacturing hub across industries.

"This is an era where politics increasingly trumps economics... and that is not a pun... In an uncertain world, it is all the more important that we continuously diversify supply sources to guarantee our national needs," Jaishankar remarked.

"The United States, long the underwriter of the contemporary system, has set radically new terms of engagement. It is doing so by dealing with countries on a one-on-one basis," he observed.

Currently, India and the US are conducting two parallel negotiations – one focusing on a framework trade agreement addressing tariffs, and another on a comprehensive trade arrangement.

The minister pointed out that China has "long played by its own rules" and continues to do so. In this complex environment, other nations remain uncertain whether to focus on visible competition or the compromises and understandings that characterize international relations.

"Faced with such pulls and pressures of globalisation, of fragmentation and of supply insecurity, the rest of the world responds by hedging against all contingencies," Jaishankar explained.

He asserted that India is making remarkable progress in infrastructure development and scientific advancement.

Noting that one-third of global production currently occurs in China, Jaishankar emphasized the growing importance of "resilience and reliability" in supply chains. "Conflicts and climate events have added to the possibility of that disruption."

Jaishankar highlighted that India is rapidly closing the gap with more successful Asian economies in terms of infrastructure – including highways, railways, aviation, ports, and energy. "We are now moving ahead, by any standards," he stated, noting that the international community is recognizing India's progress.

"With these considerations in mind, we are today endeavouring to forge new trade arrangements and promote fresh connectivity initiatives," the minister said.

Regarding trade policy, "we will naturally be guided by our people-centric vision, just as our connectivity plans will be by strategic as well as economic considerations," he explained.

Jaishankar stated that as the government works toward a developed India by 2047, "the goal of foreign policy is to steadily expand our footprint beyond its current confines." He emphasized that the solidarity India has built with the Global South provides a foundation for this expansion.

The minister asserted that India's diplomatic approach to increasing comprehensive national power is "active rather than passive."

"A major power, that too with high aspirations like us, must have a significant industrial base," he said.

"Promoting industrial growth and even incentivising it, is today a key economic priority," Jaishankar noted, adding that the focus on 'Make in India' over the past decade reflects a "different mindset and greater ambition."

He emphasized that attention is being directed toward advanced technologies and manufacturing to ensure India remains competitive.

"We are now in the world of chips and semiconductors, electric vehicles and batteries, drones and space, or that of nanotech and bioscience. Each of them offers opportunity to leapfrog and establish unique capabilities," Jaishankar concluded.