India's digital economy, despite its fifth-most digitalized ranking and robust public infrastructure, faces new challenges in a global order shifting from open trade to mercantilism and economic statecraft, according to Nitin Pai. He argues that the powerful now seek to own entire supply chains, viewing interdependence through the lens of chokepoints rather than mutual gain, necessitating prudent steps to manage risks.
Concurrently, Narayan Ramachandran highlights how the West Asian conflict has damaged India’s Composite PMI, impacting fuel prices, capital inflows, and the rupee, raising the significant risk of stagflation. This economic scenario is particularly difficult for developing countries like India to combat, as monetary policy interventions risk either negative growth or stoking inflation. Furthermore, a recent Quad Foreign Ministers Meeting in New Delhi pivoted from security to economic security and supply chain frameworks, discussing initiatives like Maritime Surveillance Cooperation and the Indo-Pacific Energy Security Framework, reflecting evolving geopolitical priorities.
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