Economic Security and Resilience Review

This issue opens with PM Narendra Modi’s visit to Uzbekistan, which carries significance for India’s efforts to strengthenresilience of its critical mineral and energy supply chains. The signing of an MOU on mining cooperation provides a framework for collaboration in geological exploration, mineral processing and the development of integrated value chains. The reported progress towards a long-term uranium supply arrangement is particularly noteworthy.

This issue also highlights EAM Dr. S. Jaishankar’s recent advice to Indian industry to “de-risk, distrust and diversify”, providing a framework for thinking about economic resilience in an uncertain global environment. His suggestion that supply chains can no longer be based exclusively on “just in time” considerations, and that some degree of redundancy and hedging may be necessary, has implications not merely for individual enterprises but also for the way India approaches strategic sourcing and supply-chain partnerships.

The author highlights India’s continuing efforts to build greater domestic resilience in energy and technology. The objective of developing and operationalising at least five indigenous small modular nuclear reactors by 2033, alongside the broader goal of achieving 100 GW of nuclear capacity by 2047, could eventually provide greater flexibility in meeting the nation’s energy requirements, apart from reducing vulnerabilities arising from conventional energy dependence.

Commerce Minister Piyush Goyal’s visit to Japan during the month evoked considerable interest, with the current geostrategic situation being seen as conducive to India receiving greater levels of interest from prospective Japanese investors

Meanwhile, US trade policy continues to lack clarity. The outcome of the Section 301 investigations into alleged “excess capacity” involving 16 economies, including India, is awaited, even as separate Section 301-related actions concerning alleged forced labour have been challenged before US courts. The continuing US resort to Section 301 points to the possibility that sectoral trade concerns may increasingly be addressed through unilateral measures rather than established multilateral disciplines.

The US administration’s “Great Transhipment Scam” report adds another potential dimension to this evolving trade policy. By identifying more than 40 countries, including India, as varying degrees of transhipment risk for Chinese-origin goods, it could lead to greater scrutiny of country-of-origin claims and supply chains serving the US market. The absence of detailed supporting evidence in some of the report’s assertions suggests that its purported findings merit careful scrutiny.

The new US National Security Science and Technology Strategy also potentially has wider and longer-term implications. Its emphasis on technological resilience, research security, investment screening and tighter export controls indicates that access to technology, capital and research collaboration is increasingly being viewed through a national-security lens. For India and other partners, the strategy could simultaneously create constraints and opportunities.

Finally, the collapse of US-Canada trade negotiations and their subsequent tariff escalation, together with the expansion of US secondary sanctions against Iran, further illustrate the increasing willingness to of major powers to use economic instruments to pursue strategic objectives. The debate over the EU’s CBAM, meanwhile, highlights the growing contest over the extent to which climate-related border measures may acquire protectionist consequences.

To read this Issue please click ESRR, Vol. IV, Issue 8.