Sunday, May 10, 2026

From Mother India to Modern Silence - Mothers, Movies and the Changing Emotional Soul of Society

Mother’s Day is not merely a celebration marked on calendars. It is perhaps humanity’s oldest emotional memory. Before nations were formed, before philosophies were written, before religions organized societies, there was the mother as protector, nurturer, teacher, healer and often the silent architect of civilizations. Across cultures and generations, the image of the mother has occupied a sacred space, both divine and deeply human. Cinema, being the mirror of society’s emotions and aspirations, has historically captured this centrality of motherhood with extraordinary intensity. Yet, somewhere along the journey from black-and-white classics to algorithm-driven and VFS streaming entertainment, the mother as the emotional centre of storytelling appears to have slowly moved from the foreground to the margins.

For the baby boomer generation and much of Gen X, the archetype of the Indian mother was immortalized in the iconic Mother India. The film was not merely cinema; it was civilizational storytelling. Radha, portrayed by Nargis, symbolized sacrifice, resilience, morality and motherhood fused into the very idea of India itself. She was not only raising sons but carrying the burden of an entire moral universe. The mother in that era was depicted as the last line of dignity standing against poverty, social injustice and moral collapse.

Indian cinema thereafter remained deeply attached to the emotional power of motherhood. Films like Deewar gave rise to one of the most unforgettable moral conflicts in Hindi cinema — the mother torn between two sons and two visions of justice. Amar Akbar Anthony transformed motherhood into a metaphor for national unity and separation. Karan Arjun gave millennials perhaps the most dramatic cinematic declaration of maternal faith through the unforgettable line that a mother knows her sons will return. In Taare Zameen Par, the mother’s silent anxiety about her misunderstood child became emotionally universal.

Regional cinema too has celebrated mothers with enormous emotional depth. Tamil cinema gave audiences films like Amma Kanakku, portraying a mother’s determination to educate her daughter against all odds. Telugu cinema repeatedly explored maternal devotion in films such as Matrudevobhava, where motherhood itself became sacred philosophy. Malayalam cinema often depicted mothers not through melodrama but through realism and emotional endurance. Kannada films too have long associated motherhood with moral courage and sacrifice.

Hollywood, despite being culturally different, has equally powerful traditions of maternal storytelling. Terms of Endearment explored the evolving relationship between mother and daughter with extraordinary tenderness. Steel Magnolias portrayed maternal strength amidst grief and community bonds. The Blind Side celebrated motherhood beyond biological boundaries, showing how compassion can redefine family. Even science fiction films such as Aliens and Interstellar carried profound themes of parental sacrifice and emotional attachment.

 

Across civilizations, mothers have occupied sacred and symbolic roles. In Hindu culture, motherhood itself is divine. The nation is “Bharat Mata.” Rivers are worshipped as mothers. The Earth is “Dharti Maa.” Goddesses like Durga, Lakshmi and Saraswati embody nurturing strength, prosperity and wisdom. Ancient Indian thought declared “Matru Devo Bhava” — Mother is God. Christianity reveres Mother Mary as the embodiment of purity and compassion. In Islam, paradise is said to lie beneath the feet of mothers. East Asian traditions deeply value filial respect rooted in Confucian ethics. African cultures often see motherhood as the custodian of tribal continuity and collective wisdom. Indigenous civilizations across the world worshipped fertility goddesses and mother earth long before modern theology evolved.

Why then are mother-centric films becoming rarer?

Part of the answer lies in how society itself has transformed. Earlier generations lived in tightly knit joint families where emotional interdependence shaped daily life. Mothers were visible anchors of households, often sacrificing personal ambitions for familial stability. Their struggles were collective experiences understood by society at large. Cinema naturally reflected this emotional structure.

Modern society, however, has become increasingly individualistic, urbanized and transactional. The vocabulary of emotions itself has changed. Public expression of sentiment is often mistaken for weakness or excessive melodrama. Younger generations communicate through short messages, emojis and fleeting digital interactions rather than prolonged emotional conversations. Families are smaller, geographically dispersed and increasingly time poor. In such an environment, the silent, self-sacrificing mother archetype no longer dominates storytelling as it once did.

Cinema too has undergone structural transformation. Earlier filmmakers invested deeply in emotional arcs and family relationships because audiences sought catharsis and moral reassurance. Today’s content economy prioritizes pace, spectacle, franchise potential and youth-centric narratives. Attention spans have shortened. Stories now revolve around self-discovery, ambition, identity crises and dystopian futures rather than collective family endurance. Even when mothers appear in contemporary cinema, they are often peripheral characters rather than emotional nuclei.

Yet this does not necessarily mean society has become less caring. Perhaps it has become more practical, more psychologically guarded and less publicly expressive. Modern mothers themselves are different from earlier cinematic depictions. Today’s mothers are professionals, entrepreneurs, political leaders, scientists and decision-makers balancing multiple identities simultaneously. Their sacrifices continue, though often in less visible ways. Instead of dramatic acts of renunciation, modern motherhood may involve navigating impossible schedules, emotional exhaustion, digital-age anxieties and the pressure to excel both at home and in professional life.

 

Ironically, the rarity of mother-centric films may itself reflect a deeper emotional vacuum in modern society. As technology accelerates life and hyper-individualism reshapes relationships, audiences perhaps unconsciously avoid stories that force emotional introspection. Films about mothers remind society of dependence, gratitude, vulnerability and unconditional love. These emotions are increasingly difficult to process in a world driven by speed and performance metrics.

And yet, despite changing times, the mother remains the centre of the human universe. Civilizations may modernize, technologies may evolve and entertainment patterns may shift, but the emotional architecture of humanity still quietly rests upon motherhood. A mother remains the first voice a child recognizes, the first touch associated with safety and the final memory many carry through life. Nations celebrate heroes, innovators and conquerors, but every one of them once rested in the arms of a mother.

This Mother’s Day is an opportunity not merely to celebrate mothers through greetings and social media posts, but to introspect on whether society has gradually become uncomfortable expressing tenderness itself. The decline of mother-centric storytelling may not only be about cinema changing. It may also be about humanity slowly learning to hide its emotions behind efficiency, ambition and curated public personas.

But somewhere deep within every generation: whether boomers remembering Mother India, millennials recalling Karan Arjun, or Gen Z discovering old films through streaming platforms, the emotional truth remains unchanged: mothers are not merely part of our stories.

Mothers are the reason stories begin at all.

For every sleepless night unnoticed, every silent sacrifice unrecorded, every prayer whispered without expectation, every fear hidden behind a reassuring smile, and every dream set aside so ours could take flight — gratitude may never be enough, yet gratitude must still be expressed.   Bowing in gratitude to all mothers.

 

 

 


Saturday, May 9, 2026

India and Vietnam: Time to Elevate a Trusted Partnership into a Strategic Economic Alliance

The May 7-9 State Visit of H.E. To Lam, General Secretary and President of Socialist Republic of Vietnam to India comes at a defining moment in Asian geopolitics and geoeconomics. In a rapidly changing global order marked by supply chain disruptions, rising protectionism, strategic competition and technological realignments, the relationship between India and Vietnam is no longer merely a diplomatic partnership rooted in goodwill and historical solidarity. It is steadily emerging as one of the most strategically relevant bilateral relationships in Asia with the potential to reshape regional economic architecture and contribute to a stable Indo-Pacific order.

India and Vietnam have shared warm political relations for decades. India stood firmly with Vietnam during difficult periods of its history, and Vietnam has consistently supported India’s larger regional role and aspirations in international forums. The relationship today rests on mutual trust, strategic convergence and civilizational affinity. Both countries believe in strategic autonomy, peaceful coexistence, rule-based international order and freedom of navigation. Both nations also increasingly see each other as reliable partners in a world where economic dependencies are becoming instruments of geopolitical pressure.

The visit of H.E. To Lam therefore carries significance beyond ceremonial diplomacy. It signals the intent of both governments to elevate the bilateral relationship into a deeper economic and strategic partnership capable of unlocking enormous untapped potential.

The economic relations between India and Vietnam have witnessed substantial expansion and increasing depth in last decade and half. Bilateral trade has risen from around US$ 2 billion in 2009 to more than US$ 16 billion, underscoring the growing economic complementarities between the two countries. The composition of trade has also evolved significantly, extending beyond conventional commodities to include sectors such as electronics, engineering products, textiles, chemicals, pharmaceuticals and agro-based products. This evolution is particularly noteworthy as it reflects the gradual emergence of deeper production linkages and value chain integration, rather than trade being confined merely to conventional buyer-seller transactions.

Vietnam today has emerged as one of Asia’s most dynamic manufacturing hubs, especially in electronics, mobile phones and export-oriented industrial production. India, on the other hand, is positioning itself as a major manufacturing and digital economy under initiatives such as “Make in India,” “Digital India” and the Production Linked Incentive schemes. There exists a natural convergence between the two economies. Vietnam’s manufacturing efficiency combined with India’s scale, technology capabilities, skilled manpower and massive domestic market can together create powerful regional value chains.

The ASEAN-India Trade in Goods Agreement has certainly contributed to the expansion of bilateral trade between India and Vietnam. However, the existing framework is increasingly proving inadequate to fully address the evolving aspirations and emerging realities of the contemporary global economy. Despite the steady growth in economic engagement, bilateral trade between the two countries continues to remain well below its actual potential. This itself highlights the enormous untapped opportunities available for deeper commercial integration, stronger market access and expanded economic cooperation between India and Vietnam.

To unlock this potential, both governments must now move decisively from incrementalism to strategic economic integration.

First, India and Vietnam should seriously engage to sign Comprehensive Economic Partnership Agreement. Such an agreement must not only focus on tariff liberalisation but also address non-tariff barriers, harmonisation of standards, customs facilitation and regulatory cooperation. Businesses in both countries often face avoidable procedural delays, certification issues and logistics bottlenecks that reduce competitiveness and increase transaction costs.

Second, strengthening connectivity must become a strategic priority within the bilateral partnership. Inadequate maritime linkages and the absence of sufficient direct shipping connectivity continue to act as significant impediments to the expansion of bilateral trade. There is therefore a pressing need to enhance direct shipping services between key ports of India and Vietnam, improve air connectivity, develop integrated logistics networks and establish more efficient trade facilitation mechanisms. Improved connectivity infrastructure would substantially reduce transit time and logistics costs, particularly benefiting sectors such as perishables, pharmaceuticals, engineering goods and textiles.

Third, both nations should actively collaborate in emerging sectors that will define the next generation of economic growth. These include semiconductors, electronics, green technologies, electric vehicles, renewable energy, digital trade, artificial intelligence, critical minerals and resilient supply chains. Vietnam’s growing role in global electronics manufacturing and India’s push for semiconductor and electronics ecosystems create substantial scope for co-production and joint ventures.

The recent investment by Vietnamese EV major VinFast in Tamil Nadu is a highly encouraging development and should be viewed as a beginning rather than an isolated success story.  India should facilitate investments in other sectors such as food-processing, chemicals, and electronics. Indian companies too must look at Vietnam not only as an export destination but as a gateway to ASEAN and East Asian markets.

Services trade also offers enormous untapped possibilities. India’s strengths in IT services, digital public infrastructure, fintech, healthcare, pharmaceuticals, education and professional services align well with Vietnam’s developmental priorities. At the same time, Vietnam’s rapidly growing tourism and hospitality sector can integrate strongly with Indian aviation, wellness and tourism industries. Direct flights between more Indian and Vietnamese cities would further accelerate tourism, business mobility and people-to-people exchanges.

Equally important is the strategic dimension of the relationship. India and Vietnam are both important stakeholders in the Indo-Pacific region. Maritime security, blue economy cooperation, defence manufacturing, cyber security and strategic technology cooperation must continue to deepen. Vietnam occupies a strategically critical location in Southeast Asia while India remains a major stabilising force in the Indian Ocean region. Stronger India-Vietnam cooperation therefore contributes not only to bilateral prosperity but also to broader Asian stability.

At a time when global supply chains are being reconfigured due to geopolitical uncertainties, both countries have a historic opportunity to emerge as trusted partners in alternative production and supply networks. International businesses today are increasingly looking for politically stable, demographically strong and economically competitive destinations. India and Vietnam together can become important anchors of such diversification strategies.

However, achieving this vision will require greater institutional engagement between industry bodies, chambers of commerce, policymakers and businesses. Industry-to-industry partnerships, SME collaborations, startup exchanges, academic cooperation and innovation platforms should become integral parts of the relationship. Business communities on both sides must also move beyond traditional sectors and actively identify future-oriented areas of collaboration.

The India-Vietnam partnership has all the ingredients necessary for transformational growth reflecting in political trust, strategic convergence, economic complementarities, demographic strength and regional importance. What is needed now is scale, speed and strategic intent.

The momentum generated by the visit has been further reinforced by the announcement of an ambitious target to raise bilateral trade between India and Vietnam to US$ 25 billion by 2030. The visit has also witnessed the signing of multiple agreements and Memoranda of Understanding across sectors including critical minerals, digital payments, pharmaceuticals, technology, cultural cooperation, maritime collaboration and supply chain resilience.   This clearly demonstrates that both governments now recognise the strategic and economic importance of elevating the partnership beyond traditional trade engagement into a more comprehensive and future-oriented economic alliance.

At the Indo Vietnam Chamber of Commerce and Industry (IVCCI), we are witnessing a steadily growing interest among Indian enterprises to explore opportunities in Vietnam across sectors such as manufacturing, renewable energy, agro-processing, pharmaceuticals, information technology, logistics, education and hospitality. Indian businesses increasingly recognise Vietnam not merely as an export destination, but as a strategic gateway into ASEAN and East Asian supply chains. Equally encouraging is the rising interest from Vietnamese enterprises looking at India as a large and trusted market, investment destination and technology partner. The ongoing State Visit of H.E. To Lam reflects this mutual intent at the highest political level and demonstrates that the enthusiasm for stronger engagement is now equally strong on both sides. The moment is therefore opportune to convert this growing interest into concrete investments, institutional partnerships, industrial collaborations and long-term strategic economic integration.

Beyond economics and geopolitics, India and Vietnam also share a profound civilisational and spiritual connection rooted in Buddhism and centuries of cultural exchange. His Excellency To Lam’s visit commencing with Bodh Gaya symbolically underlines this enduring civilisational bond.   The Buddhist heritage of India has always occupied a special place in the hearts and minds of the Vietnamese people. Sacred sites associated with Lord Buddha in India naturally create an emotional and cultural bridge between the two countries. Expanding Buddhist tourism circuits, direct connectivity to pilgrimage destinations, academic exchanges in Buddhist studies and cultural cooperation can further deepen people-to-people ties and create a stronger societal foundation for the strategic partnership. In many ways, the India-Vietnam relationship is not merely a partnership of economies or governments, but a relationship anchored in trust, history, shared values and civilisational affinity.

The visit of H.E. To Lam represented an important opportunity for India and Vietnam to redefine and elevate their partnership in line with the emerging realities of the Asian century. With strategic vision, institutional commitment and stronger economic integration, the goal of achieving US$ 25 billion in bilateral trade by 2030 can become a steppingstone towards an even larger and more consequential partnership in the years ahead.


Friday, May 1, 2026

When Growth Masks Imbalance: Rethinking the Freebie–Inequality Debate

By all accounts, Swaminathan Aiyar remains one of India’s most lucid and compelling economic commentators. His recent column arguing that Bengal voters have moved beyond the “inequality narrative” and that rapid growth can comfortably fund both welfare and public investment deserves careful attention. Yet, precisely because of his intellectual influence, it is important to respectfully disagree where the argument risks normalising a dangerous fiscal and developmental trajectory.

At the heart of the article lies a claim that inequality, when measured more holistically—including welfare transfers—appears far less severe, and that voters prioritise opportunity over redistribution. While this may reflect electoral sentiment, it does not settle the economic question. The reliance on recalibrated Gini coefficient estimates, including those by World Bank or researchers at SP Jain, risks obscuring structural disparities rather than resolving them. Welfare transfers can soften inequality statistically, but they do not necessarily address the underlying drivers—namely unequal access to quality education, healthcare, digital infrastructure, and productive employment.

This distinction is crucial. Redistribution through cash transfers or subsidies is not the same as building capability. A nation becomes genuinely egalitarian not by compressing income gaps temporarily, but by expanding opportunity structurally. That requires sustained investment in human capital and infrastructure—areas that are increasingly under pressure due to rising fiscal commitments on non-productive expenditures.

The argument that “India’s rapid growth has so far provided enough for both freebies and public investment” is, at best, a snapshot of the present—not a guarantee for the future. Economic history offers repeated warnings against extrapolating current growth trends indefinitely. India’s growth itself is contingent upon continuous capital formation, technological upgrading, and productivity gains. These, in turn, demand large and sustained public and private investments.

Here lies the core concern: the expanding culture of electoral freebies risks crowding out precisely those investments that sustain long-term growth. This is not a theoretical worry. Chief Economic Advisor, V Anantha Nageswaran has explicitly cautioned that unchecked welfare commitments could constrain fiscal space for infrastructure and social sector spending. When a larger share of state budgets is pre-committed to consumption subsidies, the flexibility to invest in future growth diminishes.

Empirical evidence from states reinforces this concern. Several Indian states now carry debt levels exceeding 30–35% of their Gross State Domestic Product (GSDP). Punjab, Rajasthan, and West Bengal are among those with particularly high debt burdens, while even relatively stronger states like Tamil Nadu and Maharashtra are witnessing upward fiscal pressures due to expanding welfare schemes. Interest payments alone consume a growing share of state revenues, leaving less room for capital expenditure.

Take the case of Karnataka’s free bus travel scheme. While politically popular, it has reportedly strained the finances of state transport undertakings and altered commuter patterns in ways that have affected urban transport viability, including metro systems. Similarly, Maharashtra’s “Ladki Bahin” scheme and other cash transfer programmes have added recurring fiscal commitments that must be financed either through higher borrowing or reallocation from other heads.

The broader issue is not whether welfare is necessary—it unquestionably is—but whether its design is fiscally sustainable and economically productive. There is a qualitative difference between targeted welfare that enhances capabilities (such as education, healthcare, or skilling) and untargeted consumption subsidies that create long-term dependency without improving productivity.

This is where the debate intersects with the future of India’s economic ambitions. As Mustafa Suleyman argues in his book The Coming Wave, the next phase of global competition will be defined by technological capabilities—particularly in artificial intelligence, synthetic biology, and advanced computing. Nations that invest aggressively in research, digital infrastructure, and human capital will dominate the economic landscape.

For India, this is not optional—it is existential. Building indigenous capabilities in AI, semiconductor manufacturing, biotechnology, and advanced manufacturing requires massive upfront investment. Digital public infrastructure, high-quality data ecosystems, research institutions, and skilled talent pipelines cannot be funded as residual expenditures after meeting ever-expanding welfare commitments. They must be prioritised.

The risk, therefore, is not immediate fiscal collapse, but gradual erosion of growth potential. When public resources are increasingly directed toward short-term consumption, the economy may continue to grow for a while, but the quality and sustainability of that growth deteriorate. Rising public debt compounds the problem. Even if India’s overall debt-to-GDP ratio remains manageable today, persistent fiscal deficits at both Union and state levels can create vulnerabilities—especially in a global environment of higher interest rates and uncertain capital flows.

The notion that voters are indifferent to inequality because they aspire for opportunity rather than redistribution is both insightful and incomplete. Aspirations are indeed rising, but they are anchored in the expectation of upward mobility. If the state substitutes structural reform with fiscal handouts, it risks undermining the very pathways through which that mobility is achieved.

Moreover, the political economy of freebies is inherently self-reinforcing. Once one state introduces a large welfare scheme, others face pressure to follow suit, creating a competitive spiral. Over time, this can lead to a “race to the bottom” in fiscal discipline, where electoral incentives override long-term economic prudence.

 

None of this implies a return to austere, minimalist governance. On the contrary, a strong state is essential—but its strength must lie in enabling productivity, not perpetuating dependency. Investments in education, healthcare, nutrition, digital connectivity, and urban infrastructure yield long-term dividends by enhancing the productive capacity of citizens. These are not “freebies;” they are foundational investments.

A more balanced approach would involve rationalising subsidies, better targeting through technology, and gradually shifting expenditure toward capital formation and capability-building. Fiscal responsibility frameworks at both Union and state levels must be strengthened and adhered to more rigorously. Transparency in off-budget borrowings and contingent liabilities is equally critical.

While the inequality narrative may indeed be losing electoral resonance in places like West Bengal, it would be premature—and potentially dangerous—to infer that the underlying economic concerns have disappeared. Growth can temporarily mask imbalances, but it cannot indefinitely compensate for misplaced priorities.

India stands at a pivotal juncture. The choices it makes today—between consumption and investment, between short-term appeasement and long-term capability—will determine whether it emerges as a truly advanced economy or remains constrained by its own fiscal contradictions. Respectfully, my humble opinion is that it is here that the optimism of Swaminathan Aiyar must be tempered with caution.


Thursday, April 9, 2026

Reforming the WTO: Why the World Cannot Afford the Collapse of Multilateral Trade

The global trading system is passing through one of its most uncertain and turbulent phases in modern economic history. For nearly three decades, the World Trade Organization (WTO) provided the institutional foundation for a rules-based global trading system that ensured predictability, stability, and fairness in international trade. That system is now under visible strain. Rising geopolitical tensions, unilateral tariff measures, industrial subsidies, supply chain nationalism, and climate-related trade barriers are increasingly challenging the multilateral framework that has governed global trade since the end of the twentieth century. The crisis facing the WTO today is not merely an institutional crisis; it is a crisis of multilateralism itself.

The weakening of the multilateral trading system is occurring at a time when global economic interdependence is deeper than ever before. Global supply chains span continents, digital trade is expanding rapidly, and emerging technologies are reshaping production and trade patterns. Yet, instead of greater cooperation, the world is witnessing a return to protectionism, industrial policy competition, and strategic trade interventions. Trade is no longer viewed purely as an instrument of economic efficiency; it is increasingly being used as an instrument of strategic and geopolitical influence. In such a world, the need for a strong multilateral trading system becomes even more important, not less.

The WTO was created to ensure that global trade would be governed by rules rather than by economic power. One of its greatest achievements was the creation of a dispute settlement system under which even small and developing countries could challenge trade measures imposed by larger economies. This gave legitimacy and balance to the global trading system. However, the paralysis of the WTO Appellate Body since 2019 has severely weakened this mechanism. Today, dispute settlement cases can be appealed into a legal vacuum, preventing enforcement of rulings and undermining the credibility of the entire system. If this situation continues, the world risks moving gradually from a rules-based trading system to a power-based trading system, where the outcome of trade disputes depends not on rules but on economic strength. Such a shift would be particularly damaging for developing countries, which rely on multilateral rules to ensure fair treatment in global markets.

At the same time, the negotiating function of the WTO has been stalled for years. The Doha Development Round, which was launched with the objective of addressing the concerns of developing countries, remains incomplete even after more than two decades. Key issues such as agriculture subsidies, public stockholding for food security, and special and differential treatment for developing countries remain unresolved. Meanwhile, new issues such as digital trade, investment facilitation, and environmental standards are being pushed into the WTO framework without adequately addressing the development concerns that were at the heart of earlier negotiations. This has created a perception among many developing countries that the multilateral trading system has become unbalanced and that historical asymmetries in global trade rules have not been adequately corrected.

One of the most significant developments in recent years has been the resurgence of industrial policy across major economies. The United States, the European Union, and China are all implementing large-scale industrial strategies supported by subsidies, tax incentives, local content requirements, and strategic investment programs in sectors such as semiconductors, renewable energy, electric vehicles, and advanced technologies. While these policies are often justified on grounds of economic security, technological leadership, and climate transition, they have the potential to distort global competition and create subsidy races among major economies. If industrial subsidies become the primary instrument of trade competition, countries with greater fiscal capacity will gain an unfair advantage, further widening the gap between developed and developing economies.

Another emerging challenge comes from unilateral trade measures linked to climate and environmental policies. Measures such as carbon border adjustment taxes and deforestation regulations are being introduced with the objective of addressing climate change and environmental degradation. While these objectives are legitimate, the unilateral nature of these measures and the compliance burdens they impose raise concerns that they may function as non-tariff barriers, particularly against exports from developing countries. If environmental standards are used as trade barriers without providing technology transfer and financial support for green transitions in developing countries, the result could be a new form of green protectionism.

 

Simultaneously, the rapid proliferation of regional and bilateral trade agreements is reshaping global trade governance. Countries are increasingly entering into regional trade arrangements to secure market access and strengthen supply chain partnerships. While such agreements can promote trade among participating countries, they also risk fragmenting the global trading system into competing trade blocs. The more trade rules are negotiated outside the WTO framework, the weaker the multilateral system becomes. Over time, this could lead to a world divided into regional trading blocs, reducing the universality of trade rules and increasing the complexity of global trade governance.

Despite all these challenges, the WTO remains indispensable. It still provides the only global platform where all countries — large and small — can negotiate trade rules, resolve disputes, and discuss emerging trade issues. Nearly the entire world is part of the WTO framework, and a large share of global trade still takes place under WTO rules. The collapse of the WTO would not lead to a free and open trading system; it would lead to a fragmented and unstable trading system dominated by power politics, trade wars, and competing economic blocs. Therefore, the objective before the global community should not be to abandon the WTO, but to reform and strengthen it.

The most urgent reform required is the restoration of the dispute settlement system. A time-bound dispute resolution mechanism must be established so that trade disputes are resolved quickly and rulings are enforceable. The appellate mechanism must be restored with reforms that address concerns about delays and judicial overreach. Fast-track dispute resolution mechanisms could be introduced for smaller disputes, and greater use could be made of mediation and arbitration to reduce litigation time. Without an effective dispute settlement system, the credibility of WTO rules cannot be maintained.

Equally important is the need to restore the development dimension of the WTO. Developing countries must be able retain policy space to industrialize, diversify their economies, and move up the value chain. Special and differential treatment provisions must be strengthened and made more operational rather than being diluted over time. Agriculture subsidy rules must also be rebalanced to address long-standing asymmetries, as developed countries continue to provide significant subsidies to their agricultural sectors while developing countries face restrictions on supporting their farmers and maintaining food security programs.

 

Reform of subsidy rules is another important area. The WTO needs new rules that address modern industrial subsidies, particularly in high-technology and green sectors, while allowing developing countries the flexibility to support emerging industries. A proper distinction must be made between subsidies that distort global trade and subsidies that are necessary for development and structural transformation.

The WTO must also develop a multilateral framework to address climate-related trade measures. Climate change is a global problem and requires global solutions. If countries begin imposing unilateral carbon taxes and environmental standards without coordination, global trade will become increasingly complex and fragmented. A multilateral approach that combines environmental responsibility with development support is essential.

India has an important role to play in shaping the future of the WTO. As one of the largest developing economies and a major participant in global trade, India is well positioned to articulate the concerns of the Global South while also contributing constructively to WTO reform discussions. India has consistently supported a rules-based multilateral trading system and has emphasized the importance of development, food security, and policy space for industrialization. In the coming years, India can play a leadership role in building consensus among developing countries and in advocating balanced and development-oriented WTO reforms.

The debate on WTO reform is therefore not merely about trade rules; it is about the future of global economic governance. The world today faces multiple challenges — geopolitical tensions, climate change, technological transformation, and economic inequality. A stable and predictable global trading system is essential for addressing these challenges.

A weakened WTO would lead to greater uncertainty, more trade disputes, and slower global growth.

The history of global trade clearly shows that periods of economic nationalism and trade wars often lead to slower economic growth, declining trade, and rising political tensions between nations. The rise of protectionism during this period is widely regarded by economic historians as one of the factors that worsened the global economic crisis and increased political tensions leading up to the Second World War.

The choice before the world is clear. Either the global community reforms and strengthens the WTO to reflect the realities of the twenty-first century, or the multilateral trading system will gradually lose relevance, replaced by a fragmented system dominated by bilateral deals, regional blocs, and unilateral trade measures. A rules-based system, even if imperfect, is far better than a power-based system. Preserving and reforming the WTO is therefore not only a trade policy priority; it is a global economic necessity for global peace and prosperity.

The time has come to build a reformed WTO — a WTO 2.0 — that is faster in dispute resolution, fairer to developing countries, capable of addressing modern trade issues such as digital trade and climate trade, and strong enough to ensure that global trade remains governed by rules rather than by power. The future of free and fair global trade depends on the success of this reform effort.

 


Saturday, April 4, 2026

Impact on Indian Economy if the war continues for one more month and suggestions for short-term/temporary policy support measures

 If the ongoing geopolitical conflict continues for another month, the impact on India would extend beyond energy prices and logistics disruptions and could begin to affect growth, inflation, exports, MSMEs and fiscal stability.

The situation becomes more complex because, in addition to global uncertainties arising from the conflict, there is also a growing possibility of below-average rainfall due to the potential development of El Nino conditions. The combination of an external energy shock and a domestic monsoon risk could compound inflationary pressures and weaken rural demand, thereby creating a dual economic challenge for the Indian economy.

At the macroeconomic level, the most immediate transmission channels of the conflict are higher crude oil and LNG prices, increased freight and insurance costs, and supply chain disruptions.

Higher energy prices will increase transportation and manufacturing costs and eventually feed into inflation. At the same time, a higher oil import bill will widen the current account deficit and will put further pressure on the already weak rupee. The RBI move to force banks to unwind foreign exchange position beyond $100 million to steady the slide is timely but banks will lose money hampering credit growth. If the government reduces fuel taxes to control inflation, fiscal pressures will also increase.

These above factors together can slow economic growth if the situation persists.

If, simultaneously, the country experiences below-average rainfall due to El NiƱo conditions, the impact could be more pronounced. Lower rainfall can affect agricultural output, increase food prices, and reduce rural incomes. Since rural consumption plays a significant role in supporting domestic demand in sectors such as FMCG, two-wheelers, tractors, consumer goods and affordable housing, a weak monsoon combined with high inflation could dampen consumption demand in the economy.

Therefore, the risk is not only inflation but also a slowdown in consumption, which is an important pillar of India’s growth.

 

From a sectoral perspective, energy, petroleum, and refining would remain the most impacted sectors due to sustained high crude oil and gas prices. However, a particularly serious concern arises in LPG and gas-dependent sectors. Several industries in India, especially MSME clusters such as ceramics, glass, chemicals, foundries, food processing units, and small manufacturing units depend heavily on LPG and gas for their furnaces and heating processes. In addition, a large number of small eateries, bakeries, food processing units, and hospitality establishments also depend on LPG for daily operations.

If LPG supply becomes constrained or prices rise sharply due to prolonged disruption in supplies, several small and medium factories may be forced to reduce production or temporarily shut down. Similarly, small eateries and food-related businesses may face severe cost pressures affecting their viability. This has implications not only for domestic employment and livelihoods but also for exports, particularly in sectors such as ceramics, chemicals, processed foods, glassware, and certain engineering products where India has a significant presence in global markets. Any production disruption in these sectors would affect export commitments, employment in MSME clusters and overall industrial output, thereby putting additional strain on the economy.

The aviation sector would be significantly affected due to higher aviation turbine fuel prices, longer routes to avoid conflict zone, which would increase operating costs for airlines and potentially lead to higher airfares, thereby affecting tourism, hospitality and business travel.

Fertilisers and agriculture would become particularly sensitive if both global supply disruptions and weak monsoon conditions occur simultaneously. Higher fertiliser input costs combined with lower rainfall could affect agricultural production and farm incomes, which would have second-order effects on rural consumption and inflation.

Export-oriented sectors such as engineering goods, textiles, gems and jewellery, chemicals and pharmaceuticals would face increased freight costs, higher marine insurance premiums, shipment delays and longer working capital cycles. This could particularly affect MSME exporters who operate on thin margins and limited liquidity.

Logistics, shipping and port operations would continue to face disruptions due to rerouting of ships, higher freight rates and insurance costs, which would impact both imports of raw materials and export shipments.

MSMEs would be among the most vulnerable segments because they face immediate working capital stress when input costs rise and payments are delayed. Even otherwise viable MSMEs may face temporary financial stress due to external disruptions of this nature.

Suggested Short-Term Policy Support Measures

In view of the above situation, if the conflict continues for another month and the monsoon outlook also remains uncertain, the government may consider the following short-term measures:

1. Energy Security and LPG Availability

  • Continue diversification of crude oil, LNG and LPG sourcing.
  • Ensure uninterrupted availability of LPG and natural gas for MSME clusters and critical industries such as ceramics, glass, chemicals, food processing and small manufacturing units.
  • Maintain readiness to use strategic reserves in a calibrated manner to manage extreme price volatility.

2. Support for Exporters

  • Faster GST refunds and duty drawback disbursement.
  • Increase export credit availability and provide temporary interest subvention for export sectors affected by freight and insurance cost escalation.
  • Extension of export obligation and realisation timelines where shipments are delayed due to global disruptions.
  • Consider partial support for abnormal war-risk insurance premiums for a limited period.

3. Support for MSMEs

  • Temporary working capital support through enhanced emergency credit lines.
  • Partial credit guarantee support for MSME loans.
  • Flexibility in loan restructuring for viable MSMEs affected by external disruptions.
  • Faster release of payments due from government departments and public sector undertakings.
  • Temporary deferment of select statutory dues for the most affected sectors.

4. Aviation and Tourism

  • Temporary and calibrated reduction in taxes on Aviation Turbine Fuel in consultation with state governments to prevent sharp increases in airfares.

5. Fertilisers and Agriculture

  • Priority allocation of natural gas to fertiliser plants.
  • Timely import of fertiliser raw materials.
  • Build buffer stock of key fertilisers in case global supply disruptions coincide with weak monsoon conditions.

6. Logistics and Shipping

  • Establish a coordination mechanism between Ministries of Commerce, Shipping, Petroleum and Finance to monitor freight rates, insurance costs and shipping routes.
  • Provide logistics facilitation and faster clearances for critical imports and export consignments.

7. Inflation and Food Security Management

  • Maintain adequate buffer stocks of food grains and essential commodities.
  • Be prepared for timely market intervention to control food inflation if monsoon conditions weaken.

8. Temporary Relief in Corporate and Individual Taxes

Given the extraordinary global situation involving war, supply chain disruptions, energy price volatility and the possibility of a weak monsoon, the Government may consider temporary and targeted relief in corporate tax and individual income tax for one year. This would help companies manage rising input costs, maintain employment and investment, and help households cope with rising prices, thereby sustaining consumption demand in the economy.

Timely intervention will be critical to ensure that a temporary global crisis does not translate into factory shutdowns, export losses, MSME distress and a broader economic slowdown.