The following excerpt is from the episode, “Dhruva Jaishankar on India's Re-alignment,” on the Pacific Polarity podcast, which aired on October 29, 2026.
Jersey Lee
What lessons are Indians taking from the wild swings in American policies, other than, I assume, further vindication of its multi-alignment strategy?
Dhruva Jaishankar
I’m not sure. Actually, even that I’m not so sure about. I think one is—well, one is I’m not even sure India has necessarily a multi-aligned strategy, as some people describe it. That’s a different matter.
India has not ever had, nor will it have, the level of dependence on the United States that many of its American treaty allies and even very close partners such as Israel and Taiwan have to deal with; that is, at least on the security side. India has never sought, nor is it realistically ever going to get American troops, bases, joint commands, a nuclear umbrella, military aid, right? These are all things that are existential issues if you’re a South Korea or an Israel or a Poland or a Baltic country.
I think that uncertainty is playing out in a different way in India. It’s playing out, one, more economically. Two, I’m not sure it’s actually as uncertain. Trump himself, specific policies are driven by executive order by himself. So there is a degree of uncertainty there. But a lot of it is part of a larger trend that we’ve seen really since the global financial crisis of an America that is resetting the terms of engagement with the world. Again, on some issues, there’s actually more consensus, I think, amongst the Democrats and Republicans in the U.S. about international policy, which is there’s more skepticism of the value of alliances, more skepticism of open-ended military interventions in other countries, of non-reciprocal trade agreements, of open-ended immigration. These are all things—I mean, Trump has accelerated that trend, for sure. And the way he governs it is very different—But that broader policy trend, particularly on the economic side, has been pretty consistent.
India is a little bit insulated compared to many others on the security side because it’s not an ally. It has some concerns about export controls and things like that, but in the grand scheme of things, relatively minor. On the economic side, I think it’s more serious because the United States is India’s largest net export destination, a major source of private investment, major source of human capital development. So if you look at even raw materials and energy, if you look at India, what are the drivers India needs for growth? The United States remains an important partner and that’s not going to change. I think it’s more about how do you manage that in the near term? As is understanding what is a short-term trend, what is dependent on the Trump administration, and what is part of what we’ve seen a sort of longer trend.
Jersey Lee
Quickly, if I may, because that’s very interesting; we’ve been hearing so much about India and multi-alignment, when strategic analysts talk about India strategy. So if not multi-alignment, what would you describe India strategy to be? And is there a coherent strategy?
Dhruva Jaishankar
I lay out what I think the strategy is in the book. I don’t have a name for it, and I’m not sure a label is very helpful. I think there are three terms that are commonly trotted out by people, and each one, again, has a very specific definition.
The first is non-alignment, which really described India’s policy in the early Cold War period, where India tried to, and initially with some success, leverage its positive partnerships with both the United States and its allies on the one hand, and the Soviet Union and its allies on the other. And for a time in the early 60s, India was one of the largest aid recipients, for example, from both blocks. You would say it was a success. The downside was when there was an India-China war in 1962, neither the Soviet Union nor the United States came to India’s aid. The United States came a little belatedly, but the Soviet Union didn’t come to India’s aid at that time. In the second half of the Cold War, India effectively tilted towards the Soviet Union. So non-alignment became a bit of a misnomer even then.
The second term that’s often used is strategic autonomy. And there again, it was very much in the context of India’s decision to develop its own independent nuclear program and a realization that India cannot depend on any other partner, not the US or France or China or Russia or anybody else, the established nuclear powers to provide it with a deterrent, and therefore it needed to have its own autonomous capability on the nuclear side and the associated technologies. So sometimes you’ll hear the term strategic autonomy. I think there’s a growing realization that that term has a very negative connotation, saying what India’s not doing rather than what India is doing.
So I think the term multi-alignment has been popularized in recent years. My concern about multi-alignment is that it gives the misconception that all of India’s major relationships are equal, either equal in importance or India strives for some kind of equality there. And that’s not actually true, nor is it possible, India’s relationship with China and the United States are both important, but are very, very different in nature. India’s relationship with Europe and Russia are both important, but again, very different in nature. This idea that this kind of equivocation between its relations with major powers is not—or say between the UAE and Iran, again, those are both important relationships for India, but not the same. So I think that sometimes is misunderstood or misapplied, which is why I hesitate to use it.
Broadly, is there a strategy? I mean, again, I lay out in my book what I think are five pillars of that strategy, which is:
Internal balancing and developing its own military and economic capabilities at home.
Neighborhood first policy, particularly focused on smaller neighbors in India’s region, countries like Nepal, Bangladesh, Sri Lanka.
Balance of power in the Indo-Pacific; the Act East policy in some ways would be one major aspect of that.
Trying to manage the Pakistan problem from India’s point of view, and that involves engagement with the Middle East in a significant way.
A hybrid approach to global governance: there’s reforming existing institutions, creating new ones, and outreach to the Global South.
You can call it what you want. I actually initially wanted to call it my book “re-alignment”—which is in some ways a take on non-alignment to multi-alignment, but a bit more realistic—but sort of went away from that. So if you want to—I’m not one for labels—but if you want to call it something, that would be my preferred nomenclature.
Jersey Lee
On China-India specifically, if the two might come to a detente or even a grand bargain, what should China give ground on and what might India need to reciprocate in compromising on?
Dhruva Jaishankar
I think that the Indian concerns are quite clear, right? I think the major ones are, we need respect on the border. China’s mobilization and actions in 2020 essentially tore to shreds three decades of pretty careful India-China engagement on the border issue and boundary management issues. So you had a series of five agreements between 1992-1993 and 2013 that kind of determined how the two sides were going to approach the border. And starting in 2013, we saw that dented and again, completely torn up in 2020. So rebuilding that trust is going to take some time, but even small efforts—we’ve even had some incidents this year where it’s clear that China’s not respecting, in some cases, agreements it has signed with India. So the border remains a live issue. And China has been repeatedly saying, let’s set that issue aside and continue to engage. And India keeps saying, no, this is a very central part of our relationship. We cannot have normal relations if the boundary is not—I mean, even if the boundary is not settled, that’s a more complicated matter, but just if the border management is not respected.
I think a second issue, and I think probably of equal importance right now, is economic and trade issues. Indian companies that are competitive in almost every market around the world are not given the same market access in China. And this is contributing to a major trade deficit that remains. And there is no economic logic for this trade deficit. Wages in India are lower. You’re not seeing the level of integrated supply chains that you should. And if anything, we’re seeing, again, Chinese policy contributing further to that. Efforts are being made to disincentivize investment by Chinese investors in India in certain sectors. There have been export control restrictions most recently announced on tunnel boring equipment, but on other things, rare earths and other things like that. Even Chinese engineers have been taken off flights bound for India and who are contributing to what is perceived as a sort of China plus one strategy on the part of some manufacturing.
Those are the two big issues. There are a bunch of more minor issues, things that China is doing to help Pakistan, some of its activities in the Indian Ocean region, which are, again, not contributing to security or actually degrading security in the region, and some multilateral issues, but I think those are secondary. The two most concrete things are border management and the trade deficit.
Now, India could do a few things as well, but mostly I think dialing back certain restrictions, but again, for the most part, with one exception, most of the economic and technological restrictions on Chinese companies remain in place from 2020. There’s one that was diluted a little bit, some investment screening, but most remain in place. And for India, the security concerns are just too high associated with that. And the reasons they’re so high is because of the lack of trust on the disputed border.
Jersey Lee
We had the earlier discussion about the various alignments that India has pursued throughout its history. But regardless of what alignment, India has generally had a concept of needing to prioritize its national sovereignty, needing to prioritize being able to choose, and maintain some form of balance. Whereas a lot of the Western partners of the US, which are quite shocked by what’s happening in the US right now, they’re kind of scrambling to respond. Do you think that from India’s perspective, does it see the Western partners of the US responding as fast as they can? Or might they be frustrated that it’s still proceeding a bit more slowly, slower than they would have hoped?
Dhruva Jaishankar
I think right now, just in the last year, there’s a bit more enthusiasm, particularly for Europe, the EU in particular. This year has been in some ways a banner year for India-EU relations. Things that have been stuck for 10 years are finally moving because of the shared pressure they’re facing from the United States. But again, there are things happening between India and Japan, India, South Korea, Australia, Canada even, and many other US allies that I think would have been inconceivable even five years ago. So I think we’re still in this early stage of discovery.
But I think a reality will soon hit, particularly on security matters. I think Indians generally [over]estimate how much strategic leeway many of the US allies actually have. So many of them remain extremely dependent on the United States for key technologies, whether it is simple things like communications and navigation technologies, targeting, intelligence gathering, supply chains, and also particularly questions of export control coordination. While India may want—well, it may be a genuine desire on the part of many US allies to work more with India, and India wants to work with them—Very soon, we’ll come up to some of the limits of what is possible without bringing in the United States.
On some of these issues, the US may not care, in fact, may even encourage it as part of burden sharing. In other areas, they may say, wait, why are the Europeans cutting a deal with India? Why aren’t the Indians buying American arms instead of European? And you get into a bit of a tussle there. So I think that in India, because we’re not used to—India has not been part of that kind of alliance before—We don’t really know how it’s operating in practice, that’s leading to some limitations in engagement or it will soon lead to some limitations with US allies.
Economically, I think it’s a different story where I think there’s, again, greater autonomy, greater competitiveness, certainly in some areas less of a dependency on the US, apart from market access. So I think there’s scope, at least, for much more. But again, it’s very hard to see, even collectively, the entire West, and I would include for our purposes Japan and South Korea in this too, minus the United States as a real one-to-one replacement on many issues. It could be a partial replacement, but it’s very hard to be a full replacement. So again, I think this will be part of a gradual diversification rather than anything very sudden.
Jersey Lee
Focusing on India now, on the one hand, India increasingly recognizes the need to foster advanced manufacturing. However, we see that even in China, this isn’t leading to a sustained employment boom. Meanwhile, the advancements in AI could potentially allow India to lean on its traditional service industry and IT strengths. So what sector should India prioritize given budgetary limitations?
Dhruva Jaishankar
On the one hand, you would say all of the above, right? India is a country of 1.4 billion people. It needs everything domestically, everything from basic services to advanced technologies.
One of the challenges—you know, there are a lot of comparisons done between India’s attempts at industrial policy or industrial development compared to like South Korea or Singapore; that’s not quite, you can’t really do the same thing, the domestic market is so different in India. India is like the size of ASEAN, in terms of the demand. So deciding that you could specialize in two, three things and that can sustain your economy, in the way that it has for Taiwan or it has for Korea, four or five really competitive economies like shipbuilding, autos and things like that and electronics, that’s not really... it cannot afford just to do that. It will have to cater to a very wide variety of just for its domestic audience.
That being said, as you mentioned, there’s scarce resources. And so you see in some ways already a focus on a few kinds of things. I have written a report on this, and all it does is just take public documents from the Indian government, and essentially tracks where public spending is going behind, things like infrastructure and welfare spending. And the key industrial areas are really quite clear. It’s one, what I would call strategic technologies, defense, space, nuclear, which are needed for national security. So that requires a degree of emphasis. But you’re seeing, for example, a growth in Indian defense exports. So that’s been, I think, a little appreciated story. It is now exporting to the European Union, to Armenia, to Southeast Asia. So that’s one area.
A second is digital technologies: AI, quantum, but also the hardware associated with that: undersea cables, drones, some of the automated technologies. The third is energy, food, health, security, important for national reasons. So again, it’s everything from some pretty simple agribusiness, food storage and things like that, energy production, refined—India is not very energy rich, so it is very dependent on imports of raw materials, but it can become a big processor, as it has become for oil; but you could see that in some other critical minerals and other areas.
There are a few again, which are just of employment focus, so that’s textiles, gems and jewelry and things like that, where are sensitive because they’re large employers. So I’d say those have been the main areas where you see public support going behind in an effort to stimulate industrial policy. I would say that so far, it’s early stages, but most of this has happened in the past five years, really since the pandemic. And we’ve seen some really positive stories emerge, some really good stories on defense, space; electronics assembly has been very positive. But other areas like batteries have been much harder to do. So you have a situation now where India can produce EVs and the entire EV and quite competently at relatively low cost, relatively good quality for export markets, but cannot produce the battery associated with it, that they remain import dependent on. We’re sort of in the early stages of what is a real industrial policy, which is going to have very mixed effects. Some things are going to work much better than others.
Jersey Lee
You said at the start of your response that India can’t be compared against the Japanese and Korean economic success story. What about the Chinese experience?
Dhruva Jaishankar
China, if you think, there was a template that Japan pioneered called the Asian model of growth, which in some ways Japan had a bit of a head start because of the pre-war history, was industrialized largely before World War II, but it kind of rebuilt that infrastructure after the war in the 50s, 60s, 70s. And it was mostly characterized by inbound investment, manufacturing exports, and that required a level of market access. And this cycle, relatively high savings rate, relatively low consumption, that was the blueprint that Japan pioneered. And then you had the four Asia Tigers, South Korea, Taiwan, Hong Kong, Singapore, and then parts of Southeast Asia and the mainland China was a big one. And now Vietnam in some ways is really riding that wave. It’s a certain set of conditions that enabled all of that and some core competencies, very good early investment for example in human capital and health and education helped.
Now, India didn’t do that for a variety of reasons. And so in some ways, India almost did it backwards, right? It was a services and consumer led economy. And it was the export of services rather than the export of manufactured goods that really drove the growth of the past three decades. I think a bunch of external shocks have reinforced the need. The need had been recognized, but not a lot was really done about it for a while. Even Prime Minister Modi came in 2014 with the idea that he wanted to focus more on industrial growth; they tried some things, but there wasn’t real incentives driven.
I think it was external shocks. It was COVID pandemic, the India-China clashes of 2020, the Russian invasion of Ukraine, Trump tariffs and now the Hormuz closure that have all contributed to a real change on the ground. And again, it’s having a mixed effect because in practice it’s much harder to do. But again, some green shoots. So we’re starting to see that, but so much is driven by the domestic market in India that it’s not replicating that at scale. Today we have an oversupply of almost everything because of China. To compete on a pure market basis globally is just going to be difficult to do. So I think we’re seeing a sort of gated globalization. That’s why India is moving towards very select FTAs in an effort to get market access there and stimulate somewhat belatedly that industrial policy.
Jersey Lee
India has a reputation for being difficult for international firms to operate in. To what extent has this changed and what challenges remain? More broadly, how can India balance encouraging business activities with national sovereignty, in order to find the right balance that can maximize its development goals?
Dhruva Jaishankar
I think that that stereotype is a little dated, and I’ll give you some facts to back that up. American companies today employ more people in India than they do any in any other country in the world: 1.8 million employees outside the United States, so more than in Canada, more than China, more than in Mexico. And if India was such a difficult place to do business, I’m not sure they would do that. If you look at market access, Japanese car companies have been pretty successful: Suzuki is market leader in India; Hyundai has done spectacularly well. If you look at electronics, Samsung, Vivo, Oppo have all done pretty well in the Indian market. So from a consumer goods standpoint at least, foreign firms have found—at least those that have stuck with India—have found tremendous success.
I think it’s more true on the services side. So legal firms, foreign law firms are not allowed to operate. Foreign universities until recently could not really operate effectively. That’s changed a bit in the past couple of years. So I think on the services side, there’s more to it.
But India is an easier place to open up a foreign business than France. I think if we look at it holistically at the Indian market, foreign companies have—almost every Fortune 500 company has R&D center today in India. So again, it’s for certain kinds of things.
I think the difficulty has been in manufacturing again, and that’s because of some particular concerns about land acquisition. Historically, the main concerns were land acquisition, pretty restrictive labor laws that were often at a local level, concerns about the speed of judicial resolutions and historically poor infrastructure as well. And those, I think, contributed to this idea that India was a difficult place to manufacture in particular. So that was not entirely untrue. I think the infrastructure pieces improved radically, although India is now trying to compete with Southeast Asia. But again, by historical standards today, Indian ports have improved their capacity by more than almost 40% in the past decade. There are 90 new airports in India that have opened in the past decade. If you look at the infrastructure build out, it has been significant, but again, India is competing in many ways with Southeast Asia, which has become much more competitive in that area.
So I think there have been some tweaks to land acquisition and things like that, but I think some things have become a little bit easier. But overall, it remains a difficult place to set up a large-scale factory and operate at scale. It’s happening mostly in certain geographies, so certain states have been better: Gujarat, Maharashtra, the southern Indian states, for example, have been better, have been more in some ways a bit more business friendly and a bit more industrial friendly. So I think it’s playing out a little bit differently by region in India and by sector.
Read the full interview here or listen to the episode below.