‘Politics now trumps economics’: Jaishankar, says US rewriting global rules; China playing own game

'Politics now ‘Trumps’ economics': Jaishankar as India Accelerates Push for Supply Chain Resilience 

In a world where geopolitical turbulence increasingly shapes economic outcomes, External Affairs Minister S Jaishankar on Saturday said that politics today “trumps” economics, underscoring the need for India to diversify its supply sources and strengthen its manufacturing backbone. 

Speaking at the IIM-Calcutta campus after being conferred an Honorary Doctorate, Jaishankar offered a sweeping assessment of shifting global power equations, India’s evolving partnerships, and the country’s renewed push toward self-reliance and high-tech industrial capability. 

‘Era of uncertainty’ 

“This is an era where politics increasingly trumps economics... and that is not a pun,” Jaishankar remarked, highlighting how global fragmentation, supply insecurity, and geopolitical rivalries have reshaped trade dynamics. In such an environment, he said, India must “continuously diversify supply sources” to safeguard national interests. 

Pointing to China’s entrenched dominance — where a third of global production currently takes place—the minister said this concentration has raised serious questions about the “resilience and reliability” of supply chains. Conflicts and climate-triggered disruptions, he added, have only heightened the risks. 

US sets ‘radically new’ engagement terms 

Jaishankar described a transformed role for the United States, long considered the architect of the global economic order. Washington, he said, is now operating on “radically new terms of engagement” by dealing with nations individually rather than through broad multilateral frameworks. 

India and the US are presently navigating two parallel conversations — a framework trade deal focused on tariffs and a more comprehensive trade agreement aimed at deeper market access. 

China plays by its own rules 

Offering a sharp geopolitical contrast, Jaishankar said China has “long played by its own rules” and continues to do so, leaving many nations uncertain on whether to focus on overt competition or behind-the-scenes accommodations that define today’s power play. 

As a result, countries around the world are “hedging against all contingencies,” recalibrating their strategies amid globalisation’s fragmentation. 

Despite these challenges, Jaishankar emphasised India’s rapid transformation — especially in infrastructure and advanced technology. The country’s gap with successful Asian economies is “fast narrowing” across sectors such as highways, railways, aviation, ports, energy and power. 

“We are now moving ahead, by any standards,” he said, adding that the world is taking increasing note of India’s momentum. 

India’s ambitions extend deep into frontier sectors — from semiconductors and electric vehicles to drones, nanotechnology, and biosciences. Each area, he said, represents an opportunity for India to “leapfrog and establish unique capabilities.” 

India's foreign policy  

With India aiming to become a developed nation by 2047, Jaishankar said foreign policy must expand the country’s global footprint. New trade arrangements and connectivity initiatives, he noted, will be shaped both by India’s “people-centric vision” and broader strategic considerations. 

He underscored the role of the Global South, where India’s solidarity and leadership have strengthened its diplomatic influence. 

Jaishankar argued that India’s industrial ambitions are essential to boosting its comprehensive national power. A major power “with high aspirations,” he said, must possess a significant industrial base.