What Happened
- External Affairs Minister S. Jaishankar, speaking at the Global Economic Cooperation Conference in Mumbai (February 17, 2026), warned that the global order is entering its most turbulent phase in living memory.
- He stated that "the world is witnessing the weaponisation of production, finance, leveraging of market shares and tightening of export controls" — framing these as instruments of geopolitical competition rather than purely economic activity.
- Jaishankar argued that "economics will give way to politics and security in how nations make choices," signalling a structural shift from globalisation's logic of comparative advantage to one of strategic autonomy and resilience.
- He described the "established global order" as clearly changing, with no stable replacement emerging — characterising the current period as a "long twilight zone."
- India's response, he said, is to engage international partners "from a position of strength," citing recently concluded trade deals as evidence of India's capacity to negotiate on its own terms.
- He called de-risking and diversification "no longer optional," advocating for building national capabilities while deepening selective partnerships.
Static Topic Bridges
Geoeconomics — The Weaponisation of Economic Tools
Geoeconomics refers to the use of economic instruments — trade policy, financial systems, investment controls, supply chains, technology access — as tools of geopolitical competition. The concept gained mainstream policy salience after 2017, accelerated by the US-China trade war, the COVID-19 supply chain crisis, and the weaponisation of financial systems (SWIFT exclusion of Russia in 2022) following the Ukraine war.
Jaishankar's specific reference to "weaponisation of production" points to practices like export controls on semiconductors, rare earth minerals, and pharmaceutical APIs; "weaponisation of finance" refers to dollar sanctions regimes and restrictions on capital flows; "leveraging of market shares" refers to the use of market access as coercive leverage (as China has done with Australia, Lithuania, and others).
- Geoeconomics definition: "systematic use of economic instruments to accomplish geopolitical objectives"
- Key instruments: tariffs, export controls, investment screening (CFIUS model), sanctions, technology denial
- US semiconductor export controls (2022-24): banned advanced chip exports to China; extended to allies' firms
- SWIFT exclusion: Russia excluded from SWIFT for select banks after 2022 Ukraine invasion — demonstrated financial weaponisation
- Rare earth leverage: China controls ~60% of rare earth mining and ~85% of processing — a supply chain vulnerability for defence and electronics
- IMF estimate: geoeconomic fragmentation could reduce global GDP by 2-7% in long-run scenarios
Connection to this news: Jaishankar's remarks are a conceptual framing of the new global reality — one in which India must navigate a world where economic relationships are no longer governed primarily by efficiency but by strategic logic, and where India must build leverage rather than simply integrate.
India's Trade Strategy — De-risking, Diversification, and FTAs
India's response to geoeconomic fragmentation has been a dual strategy: building domestic manufacturing capacity (through PLI schemes, industrial corridors) while simultaneously deepening trade partnerships through bilateral and regional free trade agreements. Jaishankar's reference to "recently concluded trade deals" reflects India's accelerated FTA agenda under the current government.
Key recent milestones include the India-UAE Comprehensive Economic Partnership Agreement (CEPA, 2022), the India-Australia Economic Cooperation and Trade Agreement (ECTA, 2022), and ongoing negotiations with the UK, EU, and GCC. India also formally joined the Supply Chain Resilience Initiative (SCRI) with Japan and Australia in 2021 — aimed at reducing dependence on single-source supply chains, particularly from China.
- India-UAE CEPA: signed February 2022; first CEPA in a decade; covers 90% of tariff lines
- India-Australia ECTA: signed April 2022; interim agreement; full FTA negotiations ongoing
- India-UK FTA: under negotiation since January 2022; 14+ rounds completed
- India-EU FTA: resumed negotiations (stalled since 2013); ongoing
- PLI (Production Linked Incentive) Schemes: launched 2020 onwards; 14 sectors; ₹2 lakh crore outlay
- Supply Chain Resilience Initiative (SCRI): India, Japan, Australia (2021) — reduce China concentration risk in supply chains
- India's merchandise exports (2024-25): ~$437 billion; target $2 trillion by 2030
Connection to this news: Jaishankar's framing that India is engaging from "a position of strength" reflects the confidence that India's market size, demographic dividend, and strategic autonomy give it leverage in negotiations — a shift from earlier postures of defensive trade liberalisation.
The WTO System Under Stress — Multilateralism vs. Minilateralism
The World Trade Organization (WTO), founded in 1995 as successor to GATT, was built on the principles of most-favoured nation (MFN) treatment, non-discrimination, and rules-based trade dispute settlement. However, it faces multiple crises: the Appellate Body has been non-functional since 2019 (US blocked new appointments); the Doha Development Agenda negotiations have stalled; and the proliferation of bilateral and regional trade agreements has fragmented the rules-based order.
Jaishankar's observation that nations will prioritise politics and security over economics echoes the broader shift from multilateralism (WTO, UN frameworks) toward minilateralism (QUAD, I2U2, SCRI, IPEF — smaller groupings with strategic coherence). India participates in multiple such minilateral formats — QUAD, I2U2 (India, Israel, UAE, US), BRICS, SCO — as complementary tracks alongside formal multilateral engagement.
- WTO founded: 1995 (replaced GATT, 1947); Geneva headquarters; 164 member countries
- Appellate Body crisis: non-functional since December 2019 (US blocked new judge appointments)
- Doha Round: launched 2001; stalled on agricultural subsidies (US, EU position vs. India, developing world)
- India's WTO position: defends public stockholding for food security; opposes IP waivers on pharma being diluted; advocates for developing country interests
- QUAD: India, USA, Japan, Australia — technology, supply chain, infrastructure, maritime
- I2U2: India, Israel, UAE, USA — food security, clean energy, infrastructure
- IPEF (Indo-Pacific Economic Framework): 14 members; trade pillar, supply chains, clean economy, fair economy
Connection to this news: Jaishankar's statement that the global order is in a "twilight zone" with no clear replacement is a diagnosis of the multilateral system's failure — and implicitly, a case for India's active participation in shaping new minilateral arrangements on its own terms.
India's Strategic Autonomy — Foreign Policy Philosophy
Strategic autonomy is the foundational principle of India's foreign policy, tracing back to Nehru's Non-Alignment Movement (NAM, 1961). In contemporary context, it refers to India's capacity to make independent foreign policy and economic choices without being constrained by alignment with any single great power bloc. This is distinct from non-alignment in a bipolar world — India today engages actively with the US (QUAD, defence deals), Russia (S-400, energy purchases), and China (trade, border diplomacy) simultaneously.
Jaishankar has articulated this as India moving from a "swing state" to a "leading power" — one that shapes outcomes rather than simply choosing between existing poles. His February 2026 remarks — citing de-risking, diversification, and engagement from "a position of strength" — are consistent with this philosophy: India builds capabilities domestically and diversifies partnerships externally to maximise its autonomy in a multi-polar world.
- Non-Alignment Movement (NAM): founded 1961 (Belgrade); India was a founding member under Nehru
- Strategic autonomy: post-Cold War evolution of NAM philosophy; India engages all blocs on India's terms
- "Multi-alignment": India's current posture — simultaneous engagement with US, Russia, EU, Gulf, Global South
- India's trade with Russia (FY2024): ~$65-70 billion (surge driven by discounted oil purchases post-Ukraine war)
- India-US relations: Comprehensive Global Strategic Partnership (2023); Major Defence Partner status
- De-risking vs. decoupling: India advocates de-risking (reducing concentration risks) not decoupling (severing ties)
Connection to this news: Jaishankar's speech is a public articulation of India's strategic autonomy doctrine applied to the geoeconomic domain — India will diversify dependencies, build domestic strength, and engage selectively from a position of strength rather than reactive dependence on any single partner or system.
Key Facts & Data
- Jaishankar's speech venue: Global Economic Cooperation Conference, Mumbai, February 17, 2026
- Key terms used: "weaponisation of production, finance," "long twilight zone," "de-risking," "position of strength"
- WTO Appellate Body: non-functional since December 2019 (US blocked appointments); 164 members
- India-UAE CEPA: February 2022; India-Australia ECTA: April 2022
- PLI schemes: 14 sectors; ~₹2 lakh crore outlay; aims to boost domestic manufacturing
- Supply Chain Resilience Initiative (SCRI): India, Japan, Australia (2021)
- India merchandise exports: ~$437 billion (2024-25); target $2 trillion by 2030
- QUAD members: India, USA, Japan, Australia
- I2U2 members: India, Israel, UAE, USA
- IPEF: 14 members (Indo-Pacific framework, no tariff commitments)
- India's trade with Russia (FY2024): ~$65-70 billion (crude oil dominant)
- IMF estimate: geoeconomic fragmentation cost — 2-7% of global GDP in long-run scenarios