'Era Where Politics TRUMPS Economics': Jaishankar Slams US’ Radical Trade Rules

2 days ago
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India’s Foreign Minister Subrahmanyam Jaishankar warns that global trade is now driven more by politics than economics. Speaking in Kolkata, he criticized the US for imposing radical new trade rules and highlighted China’s assertive global stance. Jaishankar outlined how Europe, Asia, the Middle East, Africa, and Latin America are reassessing strategies amid rising geopolitical pressures, supply chain risks, and tariffs, signaling a new era where political considerations dominate global economic decisions.
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Transcript

00:00I am requested to kindly present the Ceremonial Shawl to the Honourable Minister.

00:06Our respected...

00:10It's an enormous privilege to be awarded the degree of Doctor of Philosophy, Honoris Causa,

00:22that too from such a prestigious institution like the Indian Institute of Management, Calcutta.

00:30Now, my own life has been spent in the study of international relations and the pursuit of diplomacy.

00:44This was initially as a student, then for more than four decades as a diplomat.

00:51Briefly, as I said, on the global side of business.

00:55And currently, as the Minister with the responsibility for the conduct of our foreign policy.

01:03In the course of this journey, my own understanding of this subject has evolved.

01:09And perhaps the sharpest realization is of the intricate connect between national capabilities and external aspirations.

01:22This is clearly not rocket science.

01:26But the complexity of that linkage and its relationship to policy options is something that is really brought home by experience.

01:37It is therefore natural that on an occasion like this,

01:43that too at an institution so deeply associated with our economic growth,

01:49that this should be the subject of my address.

01:53For many decades now, this connect that I have referred to has been conceptually articulated as comprehensive national power.

02:07A complex aggregation of multiple dimensions.

02:12It is a measure of a country's strength, of its quality of life, and of its ability to shape the world.

02:22Some aspects, like military or economic capacities, are more obvious.

02:28Others, like natural resources, niche technologies, or cultural impact, perhaps much less so.

02:36Occasionally, developing exceptional capabilities provide an added source of power.

02:47Now, conversely, allowing crucial vulnerabilities, such as neglect of border infrastructure,

02:55or indifference to industrialization, can be a great weakness.

02:59Let us turn to the global landscape and begin by recognizing the profound changes underway.

03:08This is an era where politics increasingly trumps economics.

03:14And that's not a pun.

03:17Decisions are now being made not merely on costs,

03:22but taking into account ownership and security.

03:26Where a product is made, or who offers a service,

03:32is as important as their price points.

03:36When de-risking overrides the logic of efficiency,

03:41the mantra of just-in-time

03:44actually gives place

03:46to the caution of just-in-case.

03:49Of course, globalization still exists,

03:53because it's too far gone to be rolled back.

03:57But, with powerful counter-forces today brought into play.

04:03Far from being an aberration,

04:06these trends have only just started,

04:09and will probably pick up pace in times to come.

04:13Now, let's turn our attention

04:15to some key elements of this transformation,

04:18which actually make for a less rule-bound

04:21and a more fragmented world.

04:25The United States,

04:28long the underwriter of the contemporary system,

04:32has set radically new terms of engagement.

04:34Not just that.

04:37It is doing so by dealing with countries

04:40on a one-on-one basis,

04:41rather than through regimes.

04:44China has long played by its own rules,

04:48and is now doing so even more.

04:51In the ensuing scenario,

04:54other nations are unclear

04:56on whether their attention should be

04:58on the visible competition,

05:00or the trade-offs and understandings

05:02that punctuate them.

05:05Faced with such pulls and pressures

05:08of globalization,

05:10of fragmentation,

05:11and of supply insecurity,

05:13the rest of the world responds

05:16by hedging against all contingencies.

05:20Even as it engages the United States

05:23and China directly,

05:25choices are avoided where feasible,

05:28and choices are made when beneficial.

05:30Simultaneously,

05:33other options between themselves

05:35are explored with greater urgency.

05:39One sign of that

05:40is the uptick in the enthusiasm today

05:44for free trade agreements

05:46across geographies.

05:50Now, while all of this is happening,

05:53the global picture is by no means static.

05:55Europe and Asia

05:58are reassessing

06:00their respective strategic predicaments.

06:03The very landscape in the Middle East

06:05has undergone a transformation.

06:08The importance of partnering Africa's growth

06:11is more widely recognized.

06:14And as distances become less relevant,

06:17new opportunities are visualized

06:19in Latin America.

06:20Now, please also bear in mind

06:24that the relative weight of nations

06:27in different domains

06:28is also undergoing a major change.

06:31Whether it is manufacturing,

06:34energy, trade, finance, technology,

06:37natural resources,

06:39connectivity, or mobility,

06:41the world is not what it was,

06:44say, just a decade ago.

06:45A third of global production

06:50currently takes place in China.

06:54This has put the spotlight

06:56on the resilience and reliability

06:58of supply chains.

07:01Conflicts and climate events

07:03have added to the possibility

07:05of their disruption.

07:07When it comes to energy,

07:09the U.S. has gone

07:10from being a major importer

07:13to a significant exporter

07:15of fossil fuels.

07:17At the same time,

07:19China dominates

07:20the world of renewables.

07:22Where trade is concerned,

07:24supply-side risks

07:25are aggravated

07:27by demand-side uncertainty.

07:30The salience of tariff rates

07:31to trade prospects

07:33has obviously heightened volatility.

07:36And as for finance,

07:38the prolific application

07:39of sanctions,

07:40the seizure of assets

07:42at the advent

07:43of blockchain-based technologies

07:45are today part

07:47of the new realities.

08:11Thank you very much for your visit.

08:14...

08:22...

08:24...

08:31...

'Era Where Politics TRUMPS Economics': Jaishankar Slams US’ Radical Trade Rules | APT

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