The Aakhya Weekly #152 | Hard Power, High Stakes, & Global Churn
In Focus: India’s Realpolitik Amid Global Flux
The last couple of months have been some of the busiest for Indian foreign policy. This week alone, Prime Minister Narendra Modi concluded state visits to Cyprus and Croatia, and attended the G7 Summit in Canada at Prime Minister Mark Carney’s invitation. However, PM Modi’s recent visits must not be viewed in isolation, as these were preceded by a series of state visits since April, by India’s President and Vice President to European nations and the subsequent marathon visits to several EU countries by External Affairs Minister, S. Jaishankar, shoring up support for India’s position on terrorism, and strengthening convergences on trade and connectivity. More importantly, India’s diplomatic outreach was marked by the fierce mobilisation of several All Party Delegations comprising MPs and leaders across party lines, projecting a united front in the aftermath of the fateful terror attack in Pahalgam on April 22 by Pakistan-based terror groups, and the subsequent Indian military actions (Operation Sindoor) against Pakistan.
With governments confronting a series of geopolitical crises, policymakers are overwhelmed by the pace of escalation, with ramifications being felt beyond borders. Despite expending significant diplomatic capital, India’s ability to achieve its stated goals is being severely tested. For instance, in a span of months, unusual foreign policy pivots by Great Powers led to disruptions, fault lines widened into conflicts, and open threats were made on tariffs, which then ushered in multiple trade wars.
Risks & Rewards
Several observers believe that the international rules-based order as we know it remains upended. While the debate on the global ‘disorder’ continues, there is no denying that the cacophony and public diplomatic fallouts have made it ever more difficult to decipher the future course of the world. India’s pursuit of high economic growth rates in such times of uncertainty seems ambitious yet herculean, throwing up more surprises than continuity.
As new conflicts shape geopolitics and new realities emerge, India’s choices will determine whether navigating newer relations and partnerships will help achieve its strategic objectives, rather than conforming to old but tried and tested options. When this unravels across geographies at an unprecedented rate, its impact on regional security will only worsen in the coming weeks, accentuating challenges in assessing costs and recalibrating strategies for securing supply chains, trade routes, and energy shipments.
Should India count its losses and safeguard strategic partnerships with the Great Powers?
Or
Should it seize the moment to pursue its great power ambitions amid a world undergoing churn?
India’s approach, for now, seems to balance both prospects. For instance, it is resisting temptations, vis-à-vis, upsetting the Indo-US strategic partnership, taking calculated risks despite some provocations by President Trump and his associates. Add to this the harsh and mocking undertones of established D.C.-based strategists, whose critique of India’s brazen new foreign policy resonates in strategic circles, indicating their discomfort in accepting India's ambitions. Nonetheless, India is attempting to consolidate relations with EU member states, finding common ground through trade, mobility, green energy, and critical technology collaboration, capitalising on the void created by Transatlantic disruptions in the Trump era. Similarly, a new administration in Canada provided an opening to normalise relations and restart dialogue, with ‘Trumpism’ also impacting Canada’s interests.
Exercising Choices Through Global Shifts
The state visit to Cyprus and the decision to send All Party Delegations across the world opened avenues for India to project its interests with renewed aggression, signalling its heft to Pakistan and its supporters like Turkey. Additionally, India’s insistence on continuing Operation Sindoor, in pursuit of its ‘zero tolerance to terrorism’ position, indicates its willingness to project hard power to meet its objectives. This is evident even in India’s diplomatic communiqués at home and abroad, even while President Trump hijacks the narrative, claiming credit for allegedly brokering a ceasefire. His repeated assertions and threats over trade naturally angered New Delhi, which considers the claims preposterous. Saner voices in the US played it down as another ‘Trumpism’; however, the US’s overtures to Pakistan did very little to assuage Indian concerns, rupturing India’s intent to create an amicable partnership with Trump 2.0. India notes this as a deviation from status quo positions on legacy issues, with several Indian red lines being tested. It believes that the rhetoric reversed 25 years of a carefully de-hyphenated Indo-US strategic partnership, which sought to build relations independent of regional dynamics involving Pakistan.
President Trump subsequently feted Pakistan Army’s Field Marshal, Asim Munir, the country’s de facto ruler. He invited PM Modi to visit Washington, D.C., on the sidelines of the G7 Summit, possibly offering a platform for resolving issues with Pakistan. India, however, picked this moment to decline the invite and assert its position, issuing a press statement about the call between the two leaders, allowing PM Modi to articulate India’s views and version of events, denying the White House the first-mover advantage this time around. Diplomatic quagmires notwithstanding, both countries continue to value and hold onto the strategic partnership. However, irritants could emerge if red lines are tiptoed, with the hope that their effects are short-lived, in line with the realities of an eclectic Trump presidency. India would look favourably on the US’s interests in the event of an Israel-Iran conflict escalation, in return for cooperation in intelligence sharing, critical technologies, and trade. However, on defence purchases and issues of national security, India will closely watch the US-Pakistan dynamics, while indicating its capabilities to pursue diverse options and its self-interests.
A Few Wins & Strategies for the Longer Haul
India is enjoying a respite from the compounding diplomatic challenges it faced with European partners and countries like Canada, at least for the near term. Even before President Trump assumed office, contestations played out, vis-à-vis the Khalistan issue and India’s purchase of Russian oil. India’s strong utterances on the purchase of Russian crude won it no admirers in Europe, as it pointed out how EU countries benefited from the supply of refined crude sourced from Russia. While that policy will be changing soon, many countries begrudgingly accepted India’s stance, attempting to impose limits on EU-India and their respective bilateral relations.
Fortunately for India, Europe’s security and trade ties with the US dismantled dramatically under Trump 2.0, offering fewer de-risking options away from China and the subsequent trade wars. While certain issues vis-à-vis trade and the Russia-Ukraine conflict persist, including open criticism of the EU’s Carbon Border Adjustment Mechanism (CBAM) by Minister S. Jaishankar, the broad consensus and positive intent shown by the European Commission President, Ursula von der Leyen, indicate mutual dependence and strengthening of relations. Both sides are keen on showing flexibility in accommodating each other's interests to help conclude the EU-India FTA. Similarly, the finalisation of the UK-India FTA and frequent ministerial visits led to the strongest ever bilateral relations between the two countries.
Challenges & Unpredictable Outcomes
When it comes to Canada, the two countries are treading cautiously, considering domestic political realities. Reinvigorating the relationship following PM Carney’s recent electoral victory was well-timed, allowing Canada to depart from the inflexible positions of the Trudeau administration. Before the G7 Summit, PM Carney justified his invite to PM Modi, suggesting that as the 5th largest economy and central to global supply chains, India’s participation was essential. Now that the countries have decided to reinstate the respective high commissioners, such positive statements from both sides set the stage for the restoration of ties. Moreover, the Canadian Security Intelligence Service (CSIS) has officially acknowledged in its 2024 annual report that Khalistani extremists are using Canadian soil to promote, fundraise, and plan violent activities primarily targeting India. It has come after five years of omissions under Trudeau, aligns with long-standing concerns raised by India, and highlights the role of Canada-based Khalistani extremists (CBKEs) in supporting politically motivated violent extremism. While the report retains tough language on India’s alleged foreign interference, it identifies the actions of CBKEs as a key driver of the interference concerns in Canada. Nevertheless, India must view it as a positive move—one which could allow the relationship to strengthen one step at a time.
Despite such posturing in recent months, India’s challenges remain unaddressed. A month after Operation Sindoor, the instabilities in the region have only multiplied after Israel’s actions in Iran, and the latter’s ballistic missile launches, some of which hit multiple sites in Tel Aviv. While Israel managed to neutralise Iran’s air defences to a significant extent, it remains far from achieving its regime change objectives. Amidst the chaos, the US’s perceived interest in using Pakistan’s resources in dealing with Iran leaves India with difficult choices, as several dynamics are yet to play out. Rearmament and military support to Pakistan will raise several red flags for India, which sees the country’s current predicament as an opportune moment to crack down on terrorism and its infrastructure that pose direct security threats to India. The challenge lies in balancing critical technology interests with the US, while achieving accelerated diversification, securing national interests, and preparing reserves in the event of an all-out war.
Top Stories of the Week
India's 2027 Census: A Digital, Inclusive, and Historic Exercise
On June 16, 2025, the Government of India announced that the 16th Census will be conducted in two phases. The first phase will begin on October 1, 2026, in snow-bound and remote Union Territories of Ladakh, Jammu & Kashmir, and mountain states of Himachal Pradesh and Uttarakhand. The rest of the country will be covered from March 1, 2027. While the basic structure remains the same, with House-listing and Housing Census followed by Population Enumeration, the 2027 Census will incorporate major technological and procedural changes.
Around 30 lakh personnel, mostly school teachers, will be engaged in the exercise. Unlike the paper-based method used in 2011, this Census will be largely digital. Enumerators will use smartphones or handheld devices loaded with the Census App to collect data, improving speed, accuracy, and monitoring. For the first time, self-enumeration will be introduced, allowing citizens to submit their information online or via apps. A unique ID will be generated for verification during field visits.
This Census is also significant for its expanded objectives. It will include caste data for all Hindus, provide the basis for delimitation of Lok Sabha and State Assembly seats after 2026, and support the implementation of one-third reservation for women in legislatures.
FASTag Gets Smarter with Annual Toll Pass
The Ministry of Road Transport and Highways has announced the launch of a FASTag-based Annual Toll Pass for private non-commercial vehicles, effective from 15 Aug 2025. This pass will be available at a fixed fee of ₹3,000 and will be valid for either 200 toll transactions or one year, whichever comes first.
The initiative aims to provide a cost-effective solution for regular highway users by significantly reducing toll expenses and enhancing ease of travel. The scheme is expected to bring down the average annual toll cost. The pass will also help drivers avoid repeated toll payments, reduce wait times, and ease congestion at toll plazas.
The Annual Pass can be purchased and managed digitally through the ‘Rajmarg Yatra’ mobile app or the official NHAI/MoRTH platforms, ensuring transparency, efficiency, and user convenience. This step aligns with the Government’s vision of promoting smart mobility and digital infrastructure.
A Few Good Reads
Aruna Sharma explains why a GST cut on fizzy drinks might boost India’s fruit farmers
In the wake of Karnataka’s ban on bike taxis, Anupam Manur calls it a regressive move that reflects governance failure and a resistance to urban innovation.
Sumit Jain and Vikrant Singh stress the need for a policy pincer, combining negative obligations such as curbing anti-competitive practices with positive obligations— interoperability to ensure fair competition in digital markets.
Amit Kapoor sees tier-2 towns rising as new job magnets.
Pranab Dhal Samanta explains how shared nuclear threats from Pakistan and Iran are drawing India and Israel closer, aligning their security and strategic interests.