Bridges, Not Blocs: India’s Quiet Ascent in a Fractured Global Order

The interplay of trade wars, protectionist policies, and the proliferation of neo-plurilateral frameworks is reshaping the global economic landscape. As countries recalibrate their positions amidst fractured multilateralism, the rise of parallel systems – from exclusive trade agreements to alternative financial architectures – has accelerated. These developments are fragmenting global markets and redefining the concept of spheres of influence in the 21st century, extending beyond territorial domains into economic, financial, and technological realms. In this evolving context, India’s position as a stabilizing force and a potential pivot between competing blocs is particularly salient.

Major powers are increasingly shaping the global economic order through overlapping networks of financial systems, trade flows, technological ecosystems, and ideological narratives. Revisionist powers such as China, Russia, Iran, and North Korea have led this charge, constructing frameworks that serve as both defensive bulwarks against Western economic coercion and offensive instruments to project influence. The ultimate goal is eroding the post-Cold War order led by the United States and its allies. 

The construction of parallel systems – such as the BRICS+ expansion, the New Development Bank (NDB), the Asian Infrastructure Investment Bank (AIIB), China’s Belt and Road Initiative (BRI), Russia’s energy corridors, and Iran’s anti-dollarization campaigns – reflects a broader push to bypass traditional nodes of global governance.

Yet the contest is not simply a binary clash between the West and revisionist powers. India’s emergence as a pivotal, non-aligned economic actor complicates this narrative, introducing a third axis of influence that is both a product and a driver of global realignments.

The construction of parallel systems – such as the BRICS+ expansion, the New Development Bank (NDB), the Asian Infrastructure Investment Bank (AIIB), China’s Belt and Road Initiative (BRI), Russia’s energy corridors, and Iran’s anti-dollarization campaigns – reflects a broader push to bypass traditional nodes of global governance. These initiatives aim to erode dollar centrality, reduce dependence on Western-dominated institutions such as the International Monetary Fund (IMF) and the World Bank, and establish alternative supply chains and financial networks. At their core lies a shared objective: to assert strategic autonomy, leverage economic tools for political gains, and advance a narrative of resistance against Western hegemony.

Most recently, in the wake of the April 22, 2025 Pahalgam terrorist attack in the Indian union territory of Jammu and Kashmir, which claimed 26 lives, India launched Operation Sindoor, targeting terrorist infrastructure in Pakistan and Pakistan-administered Kashmir. Amid this heightened conflict, the IMF approved a $2.4 billion bailout package for Pakistan on May 9. India abstained from the IMF Executive Board vote, expressing concerns that the timing of the disbursement could inadvertently support Pakistan’s military expenditures and embolden its support for cross-border terrorism. Despite these ongoing tensions, India maintained its strategic equilibrium, striking a balance between its immediate security imperatives and its broader economic and diplomatic engagements.

India’s geostrategic influence is not defined by aggressive ideological or military posturing, but by its role as a systemic stabilizer: a large, rule-abiding economy offering scale, relative predictability, and deepening integration with Western markets.

India’s trajectory as a rising economic power, however, introduces a distinct dynamic. New Delhi has resisted absorption into either camp, maintaining strategic neutrality while shaping a distinct financial and diplomatic footprint. India’s stability, vast domestic market, and non-aligned posture have made it an attractive destination for capital seeking refuge from geopolitical turbulence. The global realignment of supply chains, intensified by the China-U.S. trade war, has been pivotal to India’s ascent. The China-plus-one strategy adopted by multinationals has disproportionately benefited India, bolstered by policy frameworks such as the Production-Linked Incentive (PLI) scheme and a narrative that positions India as a trusted partner amidst trade tensions.

Empirical evidence underscores India’s growing centrality. A 2025 Bank of America survey revealed that 42 percent of Asia-Pacific fund managers are overweight in Indian equities, surpassing Japan and eclipsing China. With GDP growth projected to exceed 6 percent in 2025, moderate inflation, and robust foreign exchange reserves, India has demonstrated resilience in an era of global fragmentation. Even during the India-Pakistan standoff following the Pahalgam terrorist attacks, investor confidence in India remained strong, contrasting with earlier decades when such crises triggered capital flight. Markets now reflect India’s enhanced capacity to absorb and manage shocks.

India’s geostrategic influence is not defined by aggressive ideological or military posturing, but by its role as a systemic stabilizer: a large, rule-abiding economy offering scale, relative predictability, and deepening integration with Western markets. India has strengthened its ties with key Western partners, notably the United States, while also engaging with alternative forums, such as BRICS and the Shanghai Cooperation Organization (SCO). The recent agreement to negotiate a bilateral trade pact with the United States, coupled with increased imports of U.S. energy and defense products, illustrates India’s strategic flexibility, even as the alternative power centers intensify their push for parallel systems.

Nevertheless, India’s position is not without challenges. While it has capitalized on the China-U.S. decoupling, it must address structural bottlenecks, such as high logistics costs, regulatory inefficiencies, and infrastructure gaps, to sustain its gains. Competitors like Vietnam and Malaysia are vying for a greater share of the China-plus-one business, and China itself is regaining some investor confidence as China-U.S. tariff tensions ease. Yet India’s diversified growth model, driven more by domestic consumption than export dependence, insulates it from some external shocks and reinforces its status as a safe haven in an era of turbulence.

India’s ability to navigate these overlapping spheres – partnering with the West on its terms while maintaining functional ties with the anti-Western axis – will be critical to shaping the future of global geoeconomics.

In the contest over spheres of influence, India is best understood as a balancing power rather than a challenger. While China and Russia seek to build alternatives to the dollar system – such as the Cross-Border Interbank Payment System (CIPS) or System for Transfer of Financial Messages (SPFS), which reduce dependence on the Society for Worldwide Interbank Financial Telecommunication (SWIFT) – India has pursued a strategy of selective engagement. It participates in forums like BRICS+ and the NDB but does so from a position of hedging, enhancing its agency without becoming a client state. 

India’s ability to navigate these overlapping spheres – partnering with the West on its terms while maintaining functional ties with the anti-Western axis – will be critical to shaping the future of global geoeconomics. Ultimately, the contest over spheres of influence is no longer a binary struggle between the U.S.-led system and revisionist powers. It is a multipolar game, where India occupies a pivotal hinge position as a swing state in the global economic order, capable of shaping outcomes through its choices and partnerships. 

• International Affairs
• Indian Foreign Policy
• Great Power Dynamics
• India
• BRICS
• Global South
• multilateralism
• Multipolar
• Trade War

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