Reframing India’s Foreign Policy in a Fragmented Global Order

PM Modi’s Admission: India’s Foreign Policy Reels in a Fragmented Global Order

On February 14, 2026, Prime Minister Narendra Modi, addressing Parliament, openly acknowledged the grim erosion of rules-based multilateralism worldwide. His statement pointed to a pervasive shift toward transactional geopolitics—a departure with significant implications for India’s foreign policy. For a nation historically vested in multilateral frameworks, this recognition is both a pragmatic assessment and a daunting challenge.

Why This Is More Than a Statement

Modi’s remarks mark a rare departure from the habitual diplomatic optimism that Indian governments tend to project regarding global governance. For the last two decades, India has advocated reforms in global institutions such as the United Nations, World Trade Organization, and others to reflect emerging power realities. Yet, these institutions, once pillars of multilateral rule-making, are increasingly paralysed by geopolitical fissures. The WTO's dispute resolution mechanism has been effectively defunct since 2019 as major economies undermine consensus-building altogether. The irony is that India's long-standing plea for reform now coincides with an era where multilateral reform seems near impossible.

Moreover, the rise of bilateral economic strategies worldwide—the U.S. imposing unilateral tariffs on allies and rivals alike, China constructing alternative supply chains—renders India’s reliance on multilateralism outdated. This is not just a shift in approach but a seismic breakdown of the diplomatic scaffolding India has long leaned on.

Strategic Autonomy in 2026: Declaring Independence or Hedging Weakness?

India’s foreign policy has evolved from its Cold War-era Non-Aligned Movement doctrine to the present-day strategy of "multi-alignment." The post-Cold War era brought with it a less ideological and more transactional lens to India’s autonomy. Examples abound: India’s deliberate purchase of Russia’s sophisticated S-400 air defence system despite active U.S. sanctions, and its membership in the Quad, a grouping often perceived as anti-China.

While these moves affirm India’s independence, they also highlight the precarious balancing act New Delhi faces. The United States, increasingly portraying India as a "swing state" in its strategic rivalry with China, implicitly demands more alignment than India may be willing—or able—to provide. On the other hand, China's deepening trade and supply chain penetration worldwide—including as the largest trading partner for over 120 countries—forces India to engage while deterring simultaneously. The gap between autonomy and power projection here is glaring. India may be declaring independence, but does it have enough leverage to enforce it?

The Institutional Machinery: Who Sets the Rules?

India’s multi-alignment strategy necessitates enhancing its capabilities across defence, trade, and diplomacy. Key institutions facilitating this approach include:

• Ministry of External Affairs (MEA): Responsible for orchestrating India's engagement with multilateral platforms like BRICS, G-20, and various regional blocs.
• Defence Agreements: India has significantly scaled defence cooperation with the U.S. under agreements such as the Communications Compatibility and Security Agreement (COMCASA) and the Basic Exchange and Cooperation Agreement (BECA).
• Foreign Trade Policy: Managed by the Directorate General of Foreign Trade under the Foreign Trade Development and Regulation Act, 1992. Diversifying exports beyond Europe and North America falls under its ambit.

Yet, institutional readiness remains mixed. India’s low contributions to multilateral development financing, tensions within regional investments like SAGAR (Security and Growth for All in the Region), and slow bureaucratic responses render its foreign policy machinery less agile than the geopolitical volatility demands. This is an uncomfortable reality.

Does the Data Back It Up?

The government’s rhetoric on multi-alignment hides certain vulnerabilities. For instance:

• Export Concentration: Over 65% of India’s exports are directed to just 10 countries, exposing Indian trade to supply chain volatility and tariff risks.
• Defence Imports: Despite "Make in India" campaigns, approximately 40% of India’s defence procurements still come from Russia—a figure unlikely to change quickly.
• FDI Attraction: India attracted $83 billion in FDI in FY2023-24, but comparative figures from Southeast Asia indicate heavy competition. Vietnam’s FDI inflow rose by almost 90% during the same period.

The larger question is whether India’s institutions are equipped to reduce dependencies in trade, defence, and energy—three pillars of its foreign policy framework.

Uncomfortable Questions Nobody Is Asking

Despite frequent invocations of lofty strategies, there are significant blind spots that remain under-discussed. First, India’s advocacy for multilateral reform feels increasingly rhetorical in a geopolitical milieu dominated by bilateral power deals. Are these calls for reform credible when even platforms like BRICS produce limited structural outputs?

Another glaring issue is state-level implementation capacity within India. For example, trade expansion into ASEAN and Africa requires active state participation to promote export zones, secure technology investments, and streamline logistics. Yet, uneven governance across states undermines these measures. Will India’s federal structure ever truly complement foreign policy?

Finally, there is the shadow of domestic politics encroaching into external engagement. With elections slated for March 2027, the government may skew its foreign policy toward symbolic rather than substantive moves to consolidate voter sentiment. This renders longer-term strategies vulnerable to short-term political calculus.

A Comparative Anchor: South Korea’s Strategic Adaptability

India’s foreign policy evolution mirrors certain elements of South Korea’s adaptive strategies during periods of geopolitical fragmentation. Facing U.S.-China trade wars, South Korea diversified its exports aggressively, with ASEAN overtaking China as its largest trading bloc by 2022. Bilateral defence agreements notwithstanding, Seoul tactfully resisted pressures from Washington to decouple from Beijing entirely. This balance of "pragmatic interdependence" offers a possible template for India to engage China economically while maintaining strategic deterrence, particularly in the Indo-Pacific.

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