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Subject: International Stories of Key Importance

  • Places in News: Zangezur Corridor

    Why in the News?

    The aftermath of Operation Sindoor highlights India’s strategic concerns over the proposed Zangezur Corridor in Armenia backed by Azerbaijan and Turkiye.

    Zangezur Corridor

    About the Zangezur Corridor:

    • What it is: The Zangezur Corridor is a proposed land route through Armenia’s Syunik Province that would connect Azerbaijan to its Nakhchivan region, cutting across Armenian land.
    • Who supports it: Azerbaijan and Turkiye back the project. They want a direct link without Armenian border checks or customs interference.
    • Route Details: The corridor would be about 43–44 km long and pass near the Iran-Armenia border, giving it high geopolitical value.
    • Why it’s controversial:
      • Azerbaijan sees it as a post-war right after its win in the 2020 Nagorno-Karabakh conflict.
      • Armenia insists it must have full control and sovereignty over any transport through its territory.
    • Turkiye’s Interest: It wants to use this corridor as part of its Middle Corridor project to connect with Central Asia and Europe via land routes.
    • Opposition: Iran and Armenia oppose the corridor, fearing it could:
      • Isolate Armenia,
      • Weaken Iranian access, and
      • Threaten Armenia’s territorial integrity.

    How it concerns India?

    • Strategic Ties: India is a key defence partner for Armenia and supports regional stability in the South Caucasus.
    • Trade Ambitions: India is:
      • Developing Chabahar Port in Iran,
      • Working on a transport route via Iran–Armenia–Georgia to Europe, bypassing Pakistan and the Suez Canal.
    • Concerns: If the Zangezur Corridor bypasses Armenian control, it could:
      • Disrupt India’s land trade route to Europe,
      • Reduce Iran’s regional access,
      • Weaken India’s strategic reach.
    • Larger Geo-Politics: Turkiye and Azerbaijan’s growing influence in the region is worrying for India, especially since Turkiye opposes India’s IMEC (India-Middle East-Europe Corridor).
    • India’s Stand: India supports Armenia’s sovereignty and opposes unilateral moves, aiming to:
      • Protect its trade routes,
      • Preserve strategic balance, and
      • Counter regional encirclement.
    [UPSC 2023] Consider the following pairs:

    Regions often mentioned in news : Reason for being in news

    1. North Kivu and Ituri : War between Armenia an Azerbaijan

    2. Nagorno-Karabakh : Insurgency in Mozambique

    3. Kherson and Zaporizhzhia : Dispute between Israel and Lebanon How many of the above pairs are correctly matched?

    Options: (a) Only one (b) Only two (c) All three (d) None *

     

  • International Atomic Energy Agency (IAEA)

    Why in the news?

    As of May 17, Iran holds 408.6 kg of enriched uranium (near to the weapons-grade level) up to 60%, up sharply from 274.8 kg in February 2024, according to the International Atomic Energy Agency (IAEA).

    About the International Atomic Energy Agency (IAEA):

    • What it is: The IAEA is an international organization that promotes the peaceful use of nuclear energy and ensures it is not used for making nuclear weapons.
    • Establishment: It was created in 1957 following U.S. President Dwight Eisenhower’s “Atoms for Peace” speech. It is autonomous but reports to the UN General Assembly and Security Council.
    • Where it is based: Its headquarters is in Vienna, Austria, at the UN Office.
    • Members: The IAEA has 178 member countries, including India, which was a founding member.
    • Key Roles:
      • Promote peaceful nuclear technology use.
      • Prevent nuclear weapon development through safeguards.
      • Set safety and security standards for nuclear plants and materials.
    • Global Responsibilities:
      • It monitors the Nuclear Non-Proliferation Treaty (NPT) to make sure countries don’t misuse nuclear materials.
      • It performs inspections, gives training, and supports countries in nuclear emergencies.
    • Recognition: In 2005, the IAEA won the Nobel Peace Prize for stopping the spread of nuclear weapons.

    IAEA and India:

    • India is a founding member: It supports the IAEA’s mission for peaceful nuclear development.
    • Nuclear Reactors Monitoring: Out of 22 nuclear reactors, 14 are monitored by the IAEA. These reactors use imported uranium from Russia, Kazakhstan, and Canada.
    • Obligations imposed: In 2014, under the Indo-U.S. Civil Nuclear Agreement, India accepted IAEA safeguards to show transparency.
    [UPSC 2020] In India, why are some nuclear reactors kept “IAEA Safeguards” while others are not?

    Options: (a) Some use uranium and others use thorium (b) Some use imported uranium, and others use domestic supplies* (c) Some are operated by foreign enterprises and others are operated by domestic (d) Some are State-owned and others are privately-owned

     

  • C Raja Mohan writes: In India, needed, a crypto strategy

    Why in the News?

    The MoU signed between Pakistan’s newly created Crypto Council and World Liberty Financial Inc. (WLFI)—a company linked to the Trump family—signals a dramatic pivot by Pakistan toward digital assets, despite its economic fragility.

    What are the key objectives of the Pakistan-WLFI crypto collaboration?

    • Promote Financial Inclusion: Use blockchain technology to increase access to financial services across Pakistan. Eg: The Pakistan Crypto Council aims to leverage blockchain for wider economic participation despite the country’s economic challenges.
    • Monetise National Assets: Utilize crypto to unlock value from untapped resources like rare earth minerals. Eg: Plans include using blockchain to help Pakistan capitalise on rare earth deposits for economic growth.
    • Establish Pakistan as a Crypto Hub: Position Pakistan as a regional leader in cryptocurrency trade and stablecoin usage for remittances. Eg: The MoU with WLFI includes introducing stablecoins to facilitate trade and remittances, boosting Pakistan’s role in the regional crypto market.

    Why is the Trump administration supporting cryptocurrencies in its second term?

    • Reposition US as a Global Leader in Digital Assets: Trump aims to make the US a frontrunner in blockchain innovation and cryptocurrency adoption. Eg: Issued executive orders promoting a national blockchain strategy and reducing regulatory hurdles.
    • Maintain US Dollar Dominance: By supporting dollar-backed stablecoins and banning central bank digital currencies (CBDCs), Trump seeks to preserve the US dollar’s global supremacy. Eg: The creation of the Strategic Bitcoin Reserve to hold government-seized crypto assets as national reserves, similar to gold.
    • Encourage Crypto Industry Growth and Innovation: Trump reversed previous skepticism to foster a pro-crypto environment, appointing industry-friendly figures to key roles. Eg: Inclusion of pro-crypto leaders like Elon Musk and David Sacks and pausing enforcement actions against major exchanges like Coinbase.

    How might Pakistan’s crypto ambitions affect India’s economic and security interests?

    • Risk of Cross-Border Money Laundering and Terror Funding: Pakistan’s use of decentralized cryptocurrencies may facilitate untraceable financial flows that could fund terrorism and illicit activities affecting India’s security. Eg: Concerns over digital currencies being misused to fund terror networks across borders.
    • Strategic Economic Competition in the Crypto Space: Pakistan’s push to become a regional crypto hub could challenge India’s position in the growing digital asset market and impact economic influence in South Asia. Eg: Pakistan’s plans to monetise national assets and promote crypto adoption with support from WLFI.
    • Leverage of Diaspora and Technology for Geopolitical Influence: Pakistan is engaging its diaspora and tech entrepreneurs to strengthen ties with the US and advance its crypto ambitions, potentially shifting regional power dynamics. Eg: Appointment of a British Pakistani entrepreneur to lead crypto regulation and influence policy, signaling increased geo-economic influence via digital currencies.

    When did the Indian Supreme Court raise concerns about the lack of a crypto regulatory framework?

    During the hearing of Shailesh Bhatt’s bail petition in early 2025: The Supreme Court highlighted the absence of a clear regulatory framework governing cryptocurrencies in India. The Court remarked on the paradox of taxing crypto assets without proper regulation.

    Way forward: 

    • Develop a Comprehensive Crypto Regulatory Framework: India should establish clear, balanced regulations to promote innovation, protect investors, and curb illicit activities in the crypto space.
    • Enhance Cross-Border Collaboration and Monitoring: Strengthen international cooperation to monitor and prevent misuse of cryptocurrencies for money laundering and terrorism financing, while fostering responsible crypto adoption.

    Mains PYQ:

    [UPSC 2021] What is Cryptocurrency? How does it affect global society? Has it been affecting Indian society also?

    Linkage: The growing importance of cryptocurrency, its disruptive potential in global finance, and its implications for India, specifically mentioning India’s significant number of crypto users. This PYQ demonstrates the UPSC’s interest in the fundamental understanding and societal effects of this technology.

  • As US pulls back, China is primed to expand its Soft Power

    Why in the News?

    Under President Trump, the U.S. withdrew from key global commitments like WHO and the Paris Agreement. Meanwhile, China is expanding influence by offering financial aid and increasing global investments.

    Why has the U.S. withdrawn from key international bodies like the WHO and the Paris Agreement?

    • Perceived Bias and Mismanagement: The U.S. accused the World Health Organization (WHO) of being biased towards China and mismanaging the COVID-19 pandemic response. Eg: President Trump alleged that the WHO failed to hold China accountable during the early stages of the outbreak.
    • Disproportionate Financial Burden: The U.S. claimed it was contributing significantly more than other countries, creating an unfair financial burden. Eg: The U.S. contributed around 20% of the WHO’s assessed funding, while China contributed much less until recently.
    • Rejection of Global Climate Commitments: The Trump administration viewed international climate agreements like the Paris Agreement as detrimental to American economic interests. Eg: The U.S. withdrew from the Paris Agreement and announced it would cease all financial commitments under the UNFCCC.

    What steps has China taken to increase its global influence in response to the U.S.’s retreat?

    • Increased Financial Contributions to Global Institutions: China has significantly raised its funding to international bodies like the WHO to fill the vacuum left by the U.S. Eg: After the U.S. announced its withdrawal from the WHO, China pledged an additional $500 million over five years and increased its assessed contribution from 6.5% (2015–16) to 15% (2024–25).
    • Expansion of Bilateral Lending and Debt Diplomacy: China has extended massive loans to developing countries, becoming a dominant bilateral creditor globally. Eg: China’s share in global bilateral sovereign debt rose from around 1% in 2003 to 26% in 2023, making it the largest lender worldwide.
    • Strategic Soft Power and Infrastructure Investments: China has expanded its Belt and Road Initiative and other overseas investments to enhance influence and dependency. Eg: China’s investments across Asia, Africa, and Latin America have increased, with more than 60% of respondents in a 2024 Pew survey acknowledging China’s economic influence in their countries.

    How has China’s financial contribution to the WHO changed after the pandemic?

    • Increased Assessed Contributions: China’s assessed contribution to the WHO rose from 6.5% in 2015–16 to 15% in 2024–25. This increase reflects China’s growing economic stature and its commitment to global health initiatives.
    • Significant Financial Pledges: In response to the U.S. withdrawal from the WHO, China pledged an additional $500 million over five years to support the organization’s activities. This move positions China as a leading state donor and underscores its intent to enhance its influence in global health governance.

    Where does China stand in terms of global bilateral debt holdings compared to the U.S.?

    • China as the Leading Bilateral Creditor: As of 2023, China holds approximately 26% of the external bilateral debt of developing countries, making it the largest bilateral creditor globally. Eg: China is the primary bilateral creditor for 53 countries and ranks among the top five creditors in three-quarters of all developing nations.
    • Decline in U.S. Bilateral Lending: The U.S.’s share in global bilateral debts has significantly decreased over the decades. Eg: In 1973, the U.S. held 36% of global bilateral debt, but by 2023, this share had dropped to just 4%.
    • China’s Influence on Debt Repayments: China’s substantial lending has led to a significant portion of debt repayments from developing countries being directed to it. Eg: In 2025, developing countries are projected to allocate over 30% of their bilateral debt service payments to China, surpassing payments to multilateral lenders and private creditors.

    What is the status of India in soft power? 

    • Strong Cultural Influence Globally: India’s rich culture, including yoga, Bollywood, and its large diaspora, enhances its global soft power. Eg: The International Day of Yoga is celebrated worldwide, promoting Indian culture and wellness.
    • Growing Economic and Diplomatic Presence: India is increasing its influence through diplomacy, international aid, and participation in global forums. Eg: India’s development projects and humanitarian aid in Africa and neighboring countries strengthen its soft power.
    • Challenges Affecting Soft Power Projection: Internal challenges like social issues and governance impact India’s image abroad. Eg: India’s ranking slipped to 29th in the 2024 Global Soft Power Index, indicating room for improvement.

    Way forward: 

    • Strengthen Multilateral Engagements and Global Leadership: India should actively enhance its financial and diplomatic contributions to key international bodies like WHO and climate forums to build credibility and influence, positioning itself as a responsible global leader.
    • Leverage Cultural Diplomacy While Addressing Domestic Challenges: Amplify India’s soft power by promoting cultural exports and diaspora ties, while simultaneously improving governance and addressing social issues to boost its global image and rankings.

    Mains PYQ:

    [UPSC 2024] The USA is facing an existential threat in the form of a China, that is much more challenging than the erstwhile Soviet Union.’ Explain

    Linkage: The depiction of China advancing its position while the U.S. is perceived as pulling back, creating a dynamic of increased competition and challenge between the two powers. This question presents the U.S. perspective on China as a major challenge.

  • The ongoing oil price tensions

    Why in the News?

    In May 2025, Saudi Arabia led OPEC+ to reverse previous production cuts, sparking a full-fledged oil price war—a new form of global conflict fought aggressively over barrels of crude oil rather than through military aggression.

    What is OPEC+? 

    OPEC+ is a group consisting of the Organization of the Petroleum Exporting Countries (OPEC) plus several non-OPEC oil-producing countries that coordinate their oil production policies to manage global oil supply and influence prices.

    Key points about OPEC+:

    • OPEC: A cartel of 13 major oil-exporting countries, including Saudi Arabia, Iraq, Iran, UAE, Nigeria, and others.
    • The “+”: Includes major non-OPEC producers like Russia, Mexico, Kazakhstan, Oman, and others.

    What led OPEC+ to increase oil production in May 2025?

    • Ineffectiveness of previous cuts: Despite voluntary output cuts of 2.2 million barrels per day (bpd) by eight members in 2023 (including a collective cut of 5 million bpd earlier), oil prices kept declining.
    • Oversupply & competition: New producers (e.g., Brazil, Guyana, shale oil players) increased their market share, reducing OPEC+’s control.
    • Saudi frustration: Overproduction by OPEC+ members like Kazakhstan, Iraq, UAE, and Nigeria undermined collective output discipline.
    • Market flooding strategy: To discipline overproducers and regain market share, Saudi Arabia led a reversal in strategy, increasing output (411,000 bpd) starting June 2025.
    • Preemptive move: Anticipating return of major sanctioned producers (Iran, Venezuela, Russia), OPEC+ may be frontloading production before supply increases further.

    Why is Saudi Arabia called a “swing producer”?

    • Large spare production capacity: It can increase or decrease output swiftly to influence global oil prices.
    • Stabilizing role: Prefers stable and moderately high prices to ensure consistent oil revenue.
    • Historical precedence: Has previously launched price wars (1985–86, 1998, 2014–16, 2020) to discipline the market and punish overproducers.
    • Current context: Took the largest voluntary cut (3 million bpd) in 2024, but shifted to increasing output as a strategic move to reassert influence.

    Who are the key oil producers under U.S. sanctions?

    • Russia: Sanctioned due to the Ukraine conflict and other geopolitical reasons.  
    • Iran: Sanctioned for its nuclear program and regional activities.  
    • Venezuela: Sanctioned for political repression and economic mismanagement.

    How does the oil price war affect India’s economy?

    • Lower Import Bill and Fiscal Savings: Falling oil prices reduce India’s import costs significantly. Eg: In 2024–25, India spent $137 billion on crude imports. A $1 drop in global oil prices can save India roughly $1.5 billion annually.
    • Reduced Export Earnings from Petroleum Products: India exports refined petroleum products, a top export item. Lower crude prices reduce global demand and margins for these exports. Eg: Refinery margins decline, affecting companies like Reliance Industries and Indian Oil Corporation, and reducing foreign exchange earnings.
    • Negative Impact on Gulf Economies and Remittances: Gulf countries face revenue drops, leading to reduced infrastructure spending and job losses for Indian expatriates. Eg: Over 9 million Indians work in the Gulf, sending home more than $50 billion in remittances annually. Job losses or salary cuts can hurt India’s balance of payments.
    • Lower Tax Revenues from Oil Sector: As oil prices drop, the government earns less in excise duties, royalties, and other taxes from oil and gas sales. Eg: The petroleum sector contributes significantly to India’s tax base—lower prices reduce collections, affecting fiscal planning and public spending.
    • Strained Bilateral Economic Ties with Oil Exporters: Economic decline in oil-exporting countries (like Saudi Arabia, UAE, and Nigeria) affects India’s project exports, bilateral trade, and inbound investments. Eg: Indian companies working on infrastructure projects in Gulf countries may face payment delays or cancellations due to budgetary constraints in host nations.

    Way forward: 

    • Diversify Energy Sources and Boost Renewables: Reduce dependency on crude oil imports by accelerating adoption of renewable energy, energy efficiency, and alternative fuels like hydrogen and biofuels to enhance energy security.
    • Strengthen Economic Resilience and Diplomatic Engagement: Build strategic petroleum reserves, improve fiscal buffers, and deepen diplomatic ties with diverse energy suppliers to better manage supply shocks and geopolitical risks.

    Mains PYQ:

    [UPSC 2013] It is said the India has substantial reserves of shale oil and gas, which can feed the needs of country for quarter century. However, tapping of the resources doesn’t appear to be high on the agenda. Discuss critically the availability and issues involved.

    Linkage: It focuses on the potential of unconventional sources like shale oil/gas within India, which could impact its energy security and reduce dependence on imports influenced by global price tensions.

  • Why UK is tightening immigration rules, how Indians will be affected

    Why in the News?

    Recently, the United Kingdom (UK) has announced new plans to change its immigration rules to reduce the number of people moving to the country.

    What are the key immigration reforms proposed to control net migration?

    • Raising Skilled Worker Visa Threshold: The requirement for the ‘skilled worker’ visa will be raised from the senior secondary level (A-level) back to the degree level. (The previous Conservative government lowered it to A-level in 2020.)
    • Ending Social Care Visas: The UK will no longer issue social care visas to foreign workers, reversing the post-COVID-19 expansion that allowed easier entry for care workers.
    • Reducing Graduate Visa Duration: The graduate visa, which allows international students to stay and work after completing their studies, will be shortened from 2 years to 18 months (3 years for PhD holders).
    • English Language Requirement for Dependents: Dependents of visa holders will now have to meet English language proficiency requirements to promote social integration.
    • Increasing Settlement Period: The minimum qualifying period for ‘settlement’ (permanent residency) will be increased from 5 years to 10 years.

    Why has the UK decided to discontinue social care visas for foreign workers?

    • Increased Migration and Pressure on Services: The rise in social care visas after COVID-19 led to a large influx of foreign care workers, which added strain to public services and housing. Eg: Over 114,000 additional health and care worker visas were issued between 2021 and 2023, mainly to South Asian and African nationals.
    • Reducing Low-Skilled Migration: The government plans to reduce low-skilled migration by raising visa requirements, such as increasing the skill level from A-level to a degree. Eg: Social care sector.
    • Promoting Domestic Workforce Development: There is a push to invest in training and apprenticeships for UK residents instead of relying on imported cheap labour. Eg: PM Starmer highlighted the need to focus on local skills development rather than importing workers in sectors like social care.

    Who are the major beneficiaries of the UK’s visa ?

    • South Asian Nationals: A large number of work visas were issued to workers from India, Pakistan, and Bangladesh. Eg: Many Indian care workers received health and care visas between 2021 and 2023.
    • Sub-Saharan African Nationals: Significant numbers of care workers came from countries like Zimbabwe, Ghana, and Nigeria. Eg: The visa route helped fill care sector jobs with workers from these African nations.

    How have Indian students and workers been affected by recent changes in UK visa policies?

    • Shorter Post-Study Work Visa: Graduate visa reduced from 2 years to 18 months, limiting job opportunities for Indian students. Eg, many now have less time to build careers in the UK.
    • Higher Skill Requirements: Skilled worker visas now require a degree-level qualification, excluding some mid-skilled jobs. Eg, Indian engineers and healthcare workers face stricter eligibility.
    • English Language Rules for Dependents: Dependents must meet English proficiency requirements to promote integration. Eg, Indian families may find it harder to join relatives.
    • Longer Residency for Settlement: Permanent residency eligibility increased from 5 to 10 years. Eg, Indians must wait longer to settle permanently.
    • Increased Tuition Costs: Proposed 6% fee levy on international students raises study costs. Eg, this could discourage Indian students from studying in the UK.

    Way forward: 

    • Enhance Domestic Skill Development: Invest significantly in vocational training and apprenticeships to reduce dependency on low-skilled foreign labour and create local employment opportunities.
    • Balance Migration Policies: Implement targeted immigration reforms that maintain the UK’s competitiveness in attracting global talent while ensuring sustainable public service capacity and social integration.

    Mains PYQ:

    [UPSC 2023] Indian diaspora has scaled new heights in the West. Describe its economic and political benefits for India.

    Linkage: The tightening of immigration rules in Western countries like the UK directly impacts the size, composition, and potential “scaling of new heights” of the diaspora, and thus implicitly affects the economic and political benefits for India.

  • [3rd May 2025] The Hindu Op-ed: A profound shift in the global order

    PYQ Relevance:

    [UPSC 2019] ‘The long-sustained image of India as a leader of the oppressed and marginalised Nations has disappeared on account of its new found role in the emerging global order”. Elaborate.

    Linkage: India is at a turning point, and the world is becoming more equal, moving away from old colonial ways. As Asia becomes more important again, this change is also affecting how India is seen and positioned globally.

     

    Mentor’s Comment:  India is at another turning point, similar to when Vasco da Gama arrived in Kozhikode in 1498 and the local ruler, the Zamorin, failed to act strategically. But this time, it’s not about sea trade routes—it’s about how global value chains are being reshaped through power and influence. This is a crucial moment for India, which is on track to become the world’s third-largest economy. For the past 75 years, the world has followed a post-colonial order known as globalisation. It was based on countries following common rules for the greater good, and divided the world into “donors” and “recipients.” But this idea no longer works, especially after China overtook the U.S. in foreign aid, manufacturing, and global trade share. As a result, institutions like the WTO, UN, and various treaties have become less useful to powerful countries, leading to U.S. pullouts.

    Today’s editorial analyses global value chains as being reshaped through power and influence. This content would help in the GS Paper II (International Relations).

    _

    Let’s learn!

    Why in the News?

    President Donald Trump is not acting randomly. He is reacting to a world where countries are becoming more equal and breaking free from old colonial ideas, while still trying to keep their fading advantages.

    What shift in global trade is compared to Vasco De Gama’s arrival?

    • Transition from Trade Routes to Value Chains: Vasco De Gama’s 1498 voyage opened sea-based trade routes connecting India to Europe. Today, the world is witnessing a shift from traditional trade to technology-driven global value chains (GVCs), reshaped by geopolitical forces rather than free markets. Eg: The semiconductor supply chain, where countries like Taiwan, South Korea, and the U.S. dominate chip design and fabrication, reflecting value chain complexity over simple trade.
    • Strategic Inertia vs Strategic Foresight: The Zamorin’s complacency during Vasco’s arrival represents a lack of strategic foresight in seizing global opportunities. India now faces a similar moment and must act strategically to capitalize on the global trade realignment and not miss out like in the colonial past. Eg: India’s PLI (Production Linked Incentive) schemes in electronics and pharmaceuticals are efforts to plug into global manufacturing chains proactively.
    • Geopolitically Driven Trade Structures: Earlier global trade was commercially motivated, but today it is increasingly geopolitically driven, with blocs forming and multilateralism weakening. Eg: The U.S.-China trade war and decoupling from Chinese supply chains are forcing countries like India to reposition themselves in new GVCs.

    Why is the post-colonial global order losing relevance?

    • Shift from Multilateralism to Bilateralism and Power Politics: The post-colonial world order was built on rule-based multilateral institutions (e.g., WTO, UN), promoting equal participation. Now, major powers prefer bilateral deals that prioritize national interest over global consensus. Eg: The U.S. withdrawing from multilateral agreements like the Paris Climate Accord and WTO dispute mechanisms.
    • Obsolescence of Donor-Recipient Hierarchy: The older order assumed a world divided into ‘donors’ (developed nations) and ‘recipients’ (developing nations). This has become irrelevant as emerging powers like China now surpass traditional Western powers in aid and trade influence. Eg: China’s Belt and Road Initiative (BRI) has made it a larger global lender than the World Bank in many regions.
    • Erosion of Trust During Global Crises: Global institutions failed to uphold equitable principles during emergencies, revealing self-serving behavior by developed nations. Eg: During the COVID-19 pandemic, G-7 countries hoarded vaccines and medical supplies, sidelining poorer nations and weakening trust in global cooperation.

    Who should lead India’s push for new global governance principles?

    • India’s World-Class Diplomats: India should empower its skilled and experienced diplomatic corps to frame and advocate new governance principles suited to a multipolar world. Eg: Indian diplomats played a key role in shaping the International Solar Alliance, showing leadership in global climate governance.
    • Cooperation Between Political Leadership and Policy Experts: A coordinated approach involving political vision (e.g., Prime Minister’s “Asian Century” narrative) and strategic policy institutions can guide India’s global engagement. Eg: NITI Aayog and MEA’s policy think tanks can jointly shape proposals for reforms in multilateral institutions like the WTO and UN.
    • Engagement with Global South and Emerging Institutions: India must lead with inclusive principles by aligning with BRICS, ASEAN, and the African Union, promoting a fair and tech-driven global order. Eg: India’s BRICS presidency and advocacy for the Global South Voice at G-20 summits shows readiness for leadership beyond the West-dominated system.

    How can India become a global leader in AI and technology?

    • Leverage Human Capital and Digital Infrastructure: India must build on its skilled workforce, vast datasets, and proven digital stack (like Aadhaar, UPI) to drive AI innovation. Eg: IndiaStack enabled large-scale digital public goods, which can now serve as the foundation for developing large language models (LLMs) and AI applications.
    • Promote Open-Source and Indigenous Innovation: Focusing on open-source technologies and encouraging local R&D will allow India to innovate independently and at scale. Eg: India can emulate models like DeepSeek (an open-source AI rivaling U.S. models) to build affordable, accessible AI tools.
    • Create National Consensus and Industry-Academia Collaboration: A national policy consensus involving all stakeholders—governments, academia, and industry—must be built to focus on AI, chips, and deep tech. Eg: China’s rise in hardware was driven by state-industry coordination; India needs similar programs for semiconductors and AI research centers.

    Which regions should India partner with for a new economic framework?

    • ASEAN (Association of Southeast Asian Nations): India should collaborate with ASEAN to build an Asian Common Market and leverage regional complementarities in trade, manufacturing, and digital economy. Eg: India’s Act East Policy and its trade agreements with Singapore and Thailand provide a base for deeper economic integration.
    • African Union: Africa offers a growing consumer base and untapped potential for investment in infrastructure, technology, and education. Eg: India’s Pan-African e-Network Project and growing pharma exports make Africa a strategic partner in India’s south-south cooperation.
    • BRICS and Emerging Economies: Collaborating within BRICS helps India shape multipolar global governance and alternative trade norms. Eg: India’s proposal for a BRICS currency system and its role in the New Development Bank demonstrate long-term strategic engagement.
    • Middle East (West Asia): Strong energy ties and growing interest in tech cooperation make the Middle East a key partner in India’s economic future. Eg: The India-UAE CEPA and I2U2 group (India-Israel-UAE-USA) promote trade, food security, and innovation-led partnerships.
    • Latin America and Caribbean (LAC): This region provides opportunities for trade diversification, agricultural cooperation, and technology exchange. Eg: India’s investments in pharmaceuticals and IT sectors in Brazil and Mexico mark a growing footprint in the LAC region.

    Way forward: 

    • Institutionalise Strategic Partnerships: India should formalise economic and technology alliances through frameworks like FTAs, digital cooperation pacts, and regional value chains with emerging regions (ASEAN, Africa, LAC).
    • Champion Inclusive Global Norms: Lead the Global South in advocating reforms in global governance institutions, emphasising equity, sustainability, and tech sovereignty to shape a multipolar, resilient global order.

  • From a rules-based world to shambolic disorder

    Why in the News?

    Even before Donald Trump’s time in office, there were clear signs that the world was becoming more uncertain in many areas. This was a warning of trouble in different parts of the world, and leaders in government, business, and strategy had already started getting ready for tougher times.

    What are the main global disruptions contributing to geopolitical and economic instability?

    • Leader-led Disruption and Geopolitical Tensions: Authoritarian leaders such as Xi Jinping, Vladimir Putin, and Donald Trump are reshaping global politics. Eg: Russia’s invasion of Ukraine and U.S. trade wars under Trump have strained international alliances.
    • Rise of Protectionism and Trade Wars: Economic nationalism and tariff barriers have disrupted global trade. Eg: Trump’s tariff war with China reduced U.S. GDP growth and disrupted global supply chains.
    • Technological Disruption and Cyber Threats: Rapid tech changes and cyber warfare are causing instability in national security and job markets. Eg: Growing reliance on disruptive technologies without governance frameworks leads to digital vulnerabilities.
    • Regional Conflicts and Expanding Military Influence: Conflicts in West Asia, increasing military presence, and border tensions are destabilizing regions. Eg: Israel’s offensive in Gaza, tensions in Syria, and China’s naval expansion in the Indian Ocean.
    • Resurgence of Terrorism and Non-State Actors: Groups like ISIS are re-emerging in Africa and South Asia, causing fresh security challenges. Eg: Recent terror attacks in Kashmir and IS activity in Mozambique and Congo signal renewed threats.

    Why is the United States, once a model of democratic stability, now perceived as a deeply divided nation?

    • Deepening Political Polarization: Internal divisions between conservative and liberal ideologies have intensified, weakening national unity. Eg: Sharp divide over Trump’s policies and Capitol Hill riots in January 2021 reflect erosion of democratic consensus.
    • Transactional Foreign Policy Approach: U.S. foreign relations have become self-serving, leading to fractured alliances. Eg: Trump’s tariff wars and criticism of NATO allies strained transatlantic relations.
    • Targeting of Educational and Immigration Systems: Policies against foreign students and elite institutions hurt America’s soft power and economy. Eg: Restrictions on student visas under Trump threatened $40 billion in economic contribution.
    • Economic Protectionism and Declining Global Trade Role: Shift from free trade to protectionist policies reduced U.S. leadership in global economic governance. Eg: Imposition of tariffs led to decline in U.S. GDP growth and disrupted global supply chains.

    How is China capitalising on the shifting geopolitical landscape in Asia?

    • Expanding Influence through the Belt and Road Initiative (BRI): China is using infrastructure projects to create economic dependencies and increase political leverage across Asia. Eg: China’s investment in the China-Pakistan Economic Corridor (CPEC) strengthens its hold in South Asia and secures a vital trade route.
    • Exploiting U.S. Retreat and Growing Global Uncertainty: As the U.S. retreats from global leadership, China has stepped in as a key player, especially in the Indo-Pacific. Eg: China’s leadership in the Regional Comprehensive Economic Partnership (RCEP), the world’s largest free trade bloc, contrasts with U.S. absence under Trump.
    • Enhancing Military and Naval Presence in Key Regions: China is expanding its military presence, particularly in maritime zones crucial for trade and regional security. Eg: China’s aggressive stance in the South China Sea, including artificial island building and military installations, asserts control over disputed waters.
    • Strengthening Bilateral and Multilateral Ties with Neighboring Countries: China is forging strategic alliances with neighboring countries to offset U.S. influence and enhance regional dominance. Eg: China’s growing ties with Southeast Asian countries like Cambodia and Laos, as well as influence in Sri Lanka through infrastructure projects like the Hambantota Port.
    • Leveraging the China-India Rivalry to Expand Influence: China is exploiting tensions between India and its neighbors to increase its regional influence. Eg: China’s increasing influence over Nepal, Sri Lanka, and Bangladesh, alongside tensions at the India-China border, shifts regional power dynamics in China’s favour

    What implications could this have for India?

    • Strategic Encirclement and Security Concerns: China’s increasing presence in India’s neighborhood (Pakistan, Nepal, Sri Lanka) creates strategic pressure and challenges India’s regional dominance.Eg: The development of the Hambantota Port in Sri Lanka under China’s BRI is seen as part of a “String of Pearls” strategy encircling India.
    • Economic Competition and Trade Imbalance: China’s dominance in Asian trade frameworks like RCEP and its export power pose risks to Indian manufacturing and trade sovereignty. Eg: India opted out of RCEP over concerns that cheap Chinese imports would harm Indian MSMEs.
    • Border Tensions and Military Confrontation: Persistent border disputes, particularly along the Line of Actual Control (LAC), escalate military spending and diplomatic tensions. Eg: The 2020 Galwan Valley clash led to casualties on both sides and worsened India-China relations..

    Way forward: 

    • Strengthen Strategic Partnerships: India should deepen ties with like-minded nations through forums like Quad and ASEAN to counterbalance China’s regional dominance. Eg: Enhanced defense and technology cooperation with Japan, Australia, and the U.S.
    • Boost Domestic Capabilities and Connectivity: Accelerate infrastructure development, self-reliant manufacturing (Atmanirbhar Bharat), and regional connectivity with neighbors to reduce Chinese influence. Eg: Development of the Chabahar Port to bypass China-influenced trade routes.

    Mains PYQ:

    [UPSC 2021] The USA is facing an existential threat in the form of a China, that is much more challenging than the erstwhile Soviet Union.” Explain.

    Linkage: Major shift in the global power balance and a challenge to the established international order (historically dominated by the US post-Cold War).

  • [28th April 2025] The Hindu Op-ed: The ‘political trilemma’ and the crisis in the West

    PYQ Relevance:

    [UPSC 2019] Are we losing our local identity for the global identity? Discuss

    Linkage: The tension between globalising forces and national or local identities, which is at the heart of the debate surrounding the political trilemma, particularly the interplay between international economic integration and national sovereignty/popular democracy.

     

    Mentor’s Comment:  Democracies in the West are facing a crisis marked by increasing polarization, mistrust in institutions, and rising populism, leading to more insular policies. Economist Dani Rodrik’s “political trilemma” suggests countries can only have two of three things: global economic integration, national sovereignty, and popular democracy. Despite globalization, nations have imposed trade barriers, limiting its benefits.

    Today’s editorial examines the growing polarization, distrust in institutions, and the rise of populism, which are driving countries towards more insular policies despite globalization. This topic is relevant for GS Paper 1 on Society and GS Paper 2 on Polity in the Mains exam.

    _

    Let’s learn!

    Why in the News?

    What was once just a concept in academic studies is now happening around the world, with its effects being more noticeable in Western countries than in others.

    How has globalization impacted sectors and populations in Western countries, fueling populism?

    • Job Losses in Manufacturing: Outsourcing of jobs to lower-cost countries has led to job losses in traditional sectors like steel and textiles, especially in regions like the U.S. Rust Belt, fueling populist sentiments. Eg: The U.S. steel industry decline and its role in Donald Trump’s 2016 campaign.
    • Economic Inequality: Globalization has widened the gap between prosperous urban elites and struggling rural populations, contributing to resentment and populist support. Eg: The Brexit vote, with economically disadvantaged areas pushing for leave due to perceived inequality.
    • Cultural and Identity Concerns: The movement of people and ideas has raised fears of cultural dilution, driving anti-globalization and nationalist rhetoric. Eg: The rise of far-right parties in Europe, like the National Rally and AfD, focusing on immigration and national identity.

    What are the three choices in balancing democracy, sovereignty, and globalization, according to Rodrik’s trilemma?

    • Democracy + Globalization, but Ceding Sovereignty: Countries embrace democratic participation and global economic integration but surrender some national sovereignty. Eg: The European Union (EU), where countries gave up control over key areas like trade and migration for economic benefits, leading to nationalist backlash, such as Brexit.
    • Globalization + Sovereignty, but Restricting Democracy: Countries maintain sovereignty and integrate into the global economy but limit democratic influence on economic decisions, often relying on technocratic governance. Eg: IMF-imposed austerity measures in countries like Kenya, which prioritized fiscal stability over popular democracy, leading to public dissatisfaction.
    • Democracy + Sovereignty, but Limiting Globalization: Countries preserve both sovereignty and democracy but restrict the extent of globalization, often through protectionist policies. Eg: India’s approach of using protectionism and selective foreign investment to balance globalization with domestic control, ensuring political stability and sovereignty.

    How have China and India managed their economies through selective globalisation?

    • Controlled Foreign Investment: Both countries selectively allow foreign investments in specific sectors while restricting or limiting them in others to protect strategic industries. Eg: China has encouraged foreign investments in manufacturing but tightly controls foreign ownership in sectors like media, telecom, and finance. India has similarly promoted foreign direct investment (FDI) in industries like technology but has been cautious in sectors like retail and defense.
    • Export-Oriented Growth: Both nations have prioritized export-led growth, using globalization to access international markets while maintaining strong domestic industrial policies. Eg: China’s “Made in China” strategy focused on becoming the global manufacturing hub, while India’s “Make in India” initiative aims to boost domestic manufacturing for export.
    • Government Control Over Key Sectors: Both countries retain significant government control over critical sectors, such as banking, energy, and infrastructure, to safeguard national interests. Eg: China’s state-owned enterprises (SOEs) dominate key industries like energy and finance, while India has state-run companies in sectors like oil, railways, and defense.
    • Selective Trade Agreements: China and India have negotiated trade agreements that protect domestic industries while opening up others for global competition. Eg: China joined the World Trade Organization (WTO) in 2001 but protected its agricultural sector with subsidies. India has been cautious in committing to trade agreements that might undermine its domestic sectors, like agriculture.
    • Managing Political and Economic Sovereignty: Both nations maintain tight political control, limiting the influence of external forces on domestic governance and policy-making. Eg: China tightly controls its political landscape and restricts foreign influence through measures like the “Great Firewall,” while India enforces its sovereignty by regulating foreign content in media and restricting foreign NGOs in sensitive areas.

    What consequences have Western democracies faced from balancing free trade, self-determination, and democracy?

    • Economic Inequality and Job Losses: Free trade has led to the outsourcing of manufacturing jobs to lower-cost countries, resulting in job losses and economic insecurity for certain segments of the population. Eg: In the U.S. and the U.K., industrial regions like the Rust Belt have seen significant declines in manufacturing jobs due to globalization, contributing to growing economic disparities.
    • Rise of Populism and Nationalism: As global competition increased, many voters felt left behind by globalization, leading to the rise of populist and nationalist political movements that prioritize national sovereignty over international cooperation. Eg: Brexit in the U.K. and the election of populist leaders like Donald Trump in the U.S. were fueled by sentiments of reclaiming national sovereignty and resisting the perceived negative impacts of globalization.
    • Erosion of Trust in Democratic Institutions: The challenges of balancing democracy with the pressures of globalization have caused frustration among citizens, leading to diminished trust in democratic institutions and the political establishment. Eg: In France, protests like the “Yellow Vest” movement reflect public dissatisfaction with economic policies seen as favoring global markets over local welfare, questioning the legitimacy of institutions and their responsiveness to the people’s needs.

    Way forward: 

    • Balancing Globalization with Domestic Welfare: India must ensure that globalization benefits are equitably distributed, addressing economic insecurity and preventing resentment. Eg: Support local industries and vulnerable sectors through skill development and welfare programs.
    • Strengthening Democratic Institutions: India should make democratic institutions more responsive to public concerns, ensuring inclusivity and addressing inequality. Eg: Engage citizens in policymaking to ensure economic policies benefit all.

  • [17th April 2025] The Hindu Op-ed: How China is fighting U.S. tariffs

    PYQ Relevance:

    [UPSC 2018] What are the key areas of reform if the WTO has to survive in the present context of ‘Trade War’, especially keeping in mind the interest of India?

    Linkage: A “trade war” means a situation where countries, like the U.S. and China, put extra taxes (tariffs) on each other’s products. In this article, we saw how Trump delayed these reciprocal tariffs for most countries but kept them in place for China.

     

    Mentor’s Comment:  In the three months since U.S. President Donald Trump introduced his “America First” trade policy—using trade measures to pressure other countries into giving concessions—there are signs it could seriously harm the global economy. A key part of this plan was the introduction of “reciprocal tariffs” to counter what Trump saw as unfair trade practices by other nations. However, on April 9, the day these tariffs were supposed to begin, Trump changed his mind and delayed their implementation by 90 days for all 57 target countries—except China.

    Today’s editorial discusses how Trump’s views on reciprocal tariffs have changed over time. This topic is useful for General Studies Paper 2 (International Relations) and Paper 3 (Indian Economy).

    _

    Let’s learn!

    Why in the News?

    Recently, China’s unexpected response to Trump’s trade war showed its smart long-term planning. By preparing for risks from aggressive trade partners, it managed to handle one of the worst trade tensions ever.

    What are the main features of Trump’s “America First” trade policy?

    • Imposition of Reciprocal Tariffs: The U.S. aimed to impose tariffs on imports from countries that had higher duties on American goods. Eg: A 34% tariff was imposed on Chinese goods, leading to retaliation from China.
    • Push for Bilateral Trade Deals: Trump preferred one-on-one negotiations over multilateral agreements to secure favorable terms. Eg: He delayed tariffs for 90 days to pressure 57 countries into bilateral deals.
    • Targeting Trade Deficits: The policy aimed to reduce U.S. trade deficits by demanding more access to foreign markets. Eg: The U.S. demanded that India open its agricultural market and relax patent laws.

    Why was the implementation of “reciprocal tariffs” postponed?

    • Facilitating U.S.-India Trade Negotiations: The U.S. paused the tariffs to create a conducive environment for bilateral trade discussions with India. Both nations aim to finalize the first phase of a trade agreement by autumn 2025, targeting a bilateral trade volume of $500 billion by 2030. Eg: India is contemplating significant tariff reductions on over half of its $23 billion worth of U.S. imports, marking its most substantial tariff cut in years.
    • Avoiding Economic Disruption for Indian Exporters: The tariff pause offers relief to Indian exporters, particularly in sectors like seafood, which would have been adversely affected by increased duties. Eg: Indian shrimp exporters, who rely heavily on the U.S. market, benefit from the temporary suspension, allowing continued access without additional tariffs.
    • Strategic Focus on U.S.-China Trade Tensions: By postponing tariffs on India and other countries, the U.S. can concentrate its trade enforcement efforts on China, where it has imposed tariffs as high as 125%. Eg: The U.S. maintains a 10% reciprocal tariff on Indian goods, contrasting with the significantly higher tariffs on Chinese imports.
    • Encouraging Indian Concessions in Trade Talks: The delay serves as an incentive for India to make concessions in ongoing trade negotiations, such as reducing tariffs and increasing imports of U.S. goods. Eg: India has agreed to lower tariffs on products like motorcycles and whiskey and to increase purchases of American defense and energy goods.
    •  Preventing Market Volatility and Economic Uncertainty: Immediate implementation of reciprocal tariffs could have led to market instability and economic uncertainty. The pause allows for a more measured approach to trade policy. Eg: Following the announcement of the tariff pause, Indian stock markets rebounded, with the Nifty 50 and BSE Sensex indices experiencing significant gains.

    What hurdles does the U.S. face in negotiating trade deals with countries like India?

    • Tariff and Regulatory Differences: India maintains higher tariffs on several U.S. goods, and there are strict regulations in sectors like agriculture, dairy, and e-commerce that clash with U.S. interests. Eg: The U.S. has long pushed for greater market access for its dairy products, but India restricts imports based on religious and cultural norms around animal feed.
    • Concerns Over Intellectual Property (IP) and Data Localization: The U.S. demands stronger IP protection and opposes India’s data localization rules that require storing data within Indian borders—citing it as a barrier to digital trade. Eg: U.S. tech giants like Amazon and Mastercard have raised concerns over India’s personal data protection policies impacting cross-border data flows.
    • Divergent Strategic and Economic Priorities: India prioritizes strategic autonomy and developmental needs, which often conflict with U.S. demands for liberalized trade and investment norms. Eg: India walked out of the RCEP partly due to fears of opening up markets too quickly, showing its cautious stance in trade liberalization.

    How can global economies respond to U.S. trade unilateralism?

    • Strengthening Regional Trade Blocs and Multilateral Agreements: Countries can reduce dependence on the U.S. by forming or deepening trade alliances within regions to maintain economic stability. Eg: The EU signed trade agreements with Japan and Mercosur to diversify away from U.S.-centric trade after tariff tensions.
    • Filing Disputes Through the WTO Framework: Nations can challenge unfair U.S. tariffs or trade actions at the World Trade Organization to uphold rules-based trade. Eg: The EU, China, and others filed WTO complaints against U.S. steel and aluminum tariffs imposed under national security grounds.
    • Promoting Strategic Bilateral Partnerships: Economies can build stronger bilateral trade ties with other major players to counterbalance U.S. influence and create alternative economic hubs. Eg: China and ASEAN deepened trade through the Regional Comprehensive Economic Partnership (RCEP), enhancing trade flows in Asia-Pacific.

    Way forward: 

    • Revitalise Multilateralism and WTO Reforms: Global economies should work together to strengthen the rules-based trading system and push for WTO reforms to address dispute resolution and emerging trade challenges.
    • Promote Inclusive and Balanced Trade Partnerships: Encourage fair, equitable trade agreements that consider development concerns of the Global South, ensuring that trade fosters mutual growth rather than unilateral advantage.