Multilateral order under strain, India pursuing both self-reliance and rules-based cooperation: Shaktikanta Das
NEW DELHI: India is navigating a rapidly fragmenting global economic order by backing a cooperative, rules-based system while simultaneously strengthening domestic capabilities through self-reliance, Principal Secretary to the Prime Minister Shaktikanta Das said on Tuesday.
Delivering the inaugural Bibek Debroy Memorial Lecture, Das said the world is at an “inflection point” as shifting geopolitics and trade policies reshape global governance. Traditional multilateralism, once the backbone of the global economic system, is increasingly under strain due to geopolitical rivalries, protectionism and fragmentation, he noted.
“Institutions that were once the bedrock of the rules-based system are underperforming in their core mandates,” Das said, adding that key international institutions are struggling to deliver amid rising geopolitical contestation.
He pointed out that trade and global supply chains, earlier viewed as neutral enablers of globalisation, are now being used as instruments of disruption and dominance. Trends such as reshoring and friend-shoring—where strategic alliances are prioritised over global integration—are fragmenting established global networks.
“This geo-economic fragmentation extends beyond trade to restricted technology flows, barriers to labour mobility and growing uncertainty over global public goods,” he said. Critical sectors such as semiconductors, rare earths, energy and pharmaceuticals are increasingly being leveraged as tools of influence, exposing vulnerabilities, particularly in dependent economies.
Das said these shifts have had far-reaching consequences, including slower global trade growth, realignment of supply chains and a weakening of the multilateral global order. The share of trade in global GDP has stagnated, signalling a move away from hyper-globalisation towards regionalisation, he observed.
“At some level, these trends could result in higher costs and inefficiencies,” Das said, warning that emerging markets, especially countries in the Global South, are particularly vulnerable. Economic volatility is rising, while opportunities for convergence with advanced economies are narrowing, he added.
Against this backdrop, Das said India’s position in the evolving world order is unambiguous. “India stands for a cooperative and rules-based global system, even as we proactively forge partnerships and strategies to secure our national interest in a world where power is more diffused,” he said. While acknowledging the need to revitalise multilateral institutions, he said India is also adapting to new global alignments.
Highlighting India’s policy response, Das said the country has embraced Atmanirbharta, or self-reliance, as a guiding principle. He noted that Prime Minister Narendra Modi articulated the vision of Atmanirbharta as early as 2020, ahead of broader global recognition of the risks posed by a fragmented economic order.
“Atmanirbharta is not isolationism,” Das emphasised. “It is a strategy to build core competencies and resilience.” Economic self-reliance, he said, involves developing the capacity to produce critical goods and technologies domestically and reducing excessive dependence on external sources, while remaining engaged with the global economy.