India Between Power Blocs – Analysis
THE COMING MULTIPOLAR WORLD
By Ramesh Jaura
For close to eight decades since World War II, world trade has been based, though imperfectly, on the premise that rules matter. This was from the General Agreement on Tariffs and Trade (GATT) to the establishment of the World Trade Organization (WTO). Though rules were occasionally bent, states had to justify their conduct within the rules.
This world has come to an end—not in a single disruption but through a gradual erosion.
The WTO’s dispute settlement system has been paralysed for years. “National security” exceptions, which were once narrowly construed and rarely used, have become flexible tools. Export restrictions, sanctions, technology bans, and industrial subsidies have become openly used in strategic competition. The realm of trade has been subsumed into geopolitics; markets have ceased to be neutral spaces and have become battlefields.
The US, the architect and guarantor of the post-war trade system, has de facto abandoned its role of steward. Tariffs and extraterritorial sanctions apply not only to enemies but also to partners. The EU, long a normative cornerstone of the system, has now adopted carbon border tariffs, strategic industrial subsidies, and trade screens that shatter the notion of a level playing field. China continues to pursue selective opening alongside state intervention.
For India, the implications are direct and tangible. With an ever-closer strategic partnership with Washington, New Delhi is now facing penalty tariffs on its oil purchases from Russia, which are not adjudicated by any multilateral body. This is also true for Brazil.
It is in the light of such a collapse of rules and increased leverage that the two foreign policy gestures of India—its increased involvement in Europe in the spirit of the new ‘concept of Indo-Europe’, as well as its plans to assume the BRICS 2026 presidency—need to be understood.
For close to eight decades since World War II, world trade has been based, though imperfectly, on the premise that rules matter. This was from the General Agreement on Tariffs and Trade (GATT) to the establishment of the World Trade Organization (WTO). Though rules were occasionally bent, states had to justify their conduct within the rules.
This world has come to an end—not in a single disruption but through a gradual erosion.
The WTO’s dispute settlement system has been paralysed for years. “National security” exceptions, which were once narrowly construed and rarely used, have become flexible tools. Export restrictions, sanctions, technology bans, and industrial subsidies have become openly used in strategic competition. The realm of trade has been subsumed into geopolitics; markets have ceased to be neutral spaces and have become battlefields.
The US, the architect and guarantor of the post-war trade system, has de facto abandoned its role of steward. Tariffs and extraterritorial sanctions apply not only to enemies but also to partners. The EU, long a normative cornerstone of the system, has now adopted carbon border tariffs, strategic industrial subsidies, and trade screens that shatter the notion of a level playing field. China continues to pursue selective opening alongside state intervention.
For India, the implications are direct and tangible. With an ever-closer strategic partnership with Washington, New Delhi is now facing penalty tariffs on its oil purchases from Russia, which are not adjudicated by any multilateral body. This is also true for Brazil.
It is in the light of such a collapse of rules and increased leverage that the two foreign policy gestures of India—its increased involvement in Europe in the spirit of the new ‘concept of Indo-Europe’, as well as its plans to assume the BRICS 2026 presidency—need to be understood.
From Bandung to BRICS: autonomy in a fractured order
The Indian government’s tendency to hedge during times of systemic stress is not new. Since the Bandung Conference of 1955 and the Non-Aligned Movement, the Indian government has been advocating self-reliance in an internationally polarised environment shaped by the rivalry of two power blocs. During that time, the focus was not on economic integration but rather on political independence. Non-alignment was a policy of sovereignty within the Cold War order, characterised by ideological inflexibility and military alliances.
The BRICS grouping, established in the wake of the 2008 financial crisis, represented a different moment. This was more of a reformist movement—a desire of the major emerging powers to reform the global economy from the inside out. The implication was that institutions such as the IMF, the World Bank, and the WTO should be reformed.
This assumption no longer holds true.
The institutions are no longer able to impose their rules on the most powerful players. The reform has been overtaken by fragmentation. What BRICS faces today is not a problematic system requiring adjustment, but a void in which power has fewer limits and fewer common premises.
This is also true of the Indian strategy for BRICS. Instead of viewing BRICS as a challenge to Western hegemony, the Indian government has increasingly focused on BRICS as an instrument for managing vulnerability—economic, technological, and geopolitical—in a world where the universality of norms no longer carries the force of compliance.
BRICS 2026: Managing Disorder, Not Remaking the World
When India takes over the presidency of BRICS this year, it will be leading a body that has grown to encompass much more than the founding five, which are Brazil, Russia, India, China, and South Africa, to now include Saudi Arabia, the UAE, Egypt, Ethiopia, and Indonesia.
The expansion has increased the geopolitical importance and demographic weight of the BRICS. However, it has reduced cohesion. The present-day BRICS is neither a bloc, nor an alliance, nor a counter-system. The current BRICS is a loose coalition of states with different interests, threat perceptions, and alignments.
In launching India’s BRICS presidency, External Affairs Minister S. Jaishankar encapsulated India’s agenda as resilience, innovation, cooperation, and sustainability. Note the words themselves. There is no sense of ideology or reformist passion, but a realisation that the challenge is to order the chaos rather than re-establish a previous balance.
This implies that the BRICS are focusing on issues such as resilient value chains, development financing, adaptation to climate change, health collaboration, and resilience. The trade among BRICS nations has surpassed $160 billion but is limited to commodities and energy. The financial talks, ranging from local currency trading to an enhanced BRICS Development Bank, indicate a concern with the weaponisation of finance. However, India has been cautious in approaching these to avoid disturbing its domestic economy.
Perhaps the most obvious contradiction within the BRICS group is the economic dynamic between India and China. Bilateral trade levels have broken the $100 billion mark, but mutual trust in each other’s strategic intentions continues to deteriorate.
During the Indian presidency, the BRICS group is not likely to become an institutionalised or ideologically homogeneous entity. Instead, it will continue to remain a functional group. This instrument will allow its members to better weather the challenges of a world where the safeguarding power of multilateral institutions is waning.
Indo-Europe: why Delhi and Berlin are important today
Whereas BRICS might be seen to embody India’s relations with the Global South within a fractured system, this new concept of Indo-Europe could be said to embody India’s hedge towards Europe and is grounded mainly within its relationship with Germany.
The January 12-13 visit by German Chancellor Friedrich Merz to New Delhi and his meetings with Narendra Modi were widely viewed by the Indian media as more than ceremonial. Indeed, as former Ambassador Gurjit Singh has noted, there are 27 tangible outcomes, including 19 Memoranda of Understanding, which reflect a relationship that has transcended symbolism.
The bilateral trade has already surpassed $51 billion, constituting nearly a quarter of total trade between India and the EU, Modi stated. Both leaders acknowledged that to maintain such momentum, a forward-looking vision was needed. Speaking at the CEOs’ Forum in front of Modi, Merz warned against “dangerous one-sided dependencies.”
Technology cooperation became one of the key elements. Both sides acknowledged the increasing weaponisation of essential technologies and the need for reliable partners to address this challenge. Defence cooperation, long hampered by German export restrictions, also evolved. The export approvals now proceed more swiftly, and an agreement was reached to establish a defence industrial cooperation roadmap, including talks on submarines.
Crucially, differences have been handled in a pragmatic, not ideological, fashion. India has made it clear that its national interest is the overriding consideration in its defence sourcing. Germany has signalled that it is flexible and realises that public pressure on India to move away from Russia is not helpful.
Energy transition has also become another anchor. A long-term off-take agreement between AM Green and Uniper Global Commodities on green ammonia has showcased how climate ambitions are being turned into partnerships.
The people-to-people links are also valuable. There are almost 300,000 people of Indian origin in Germany and 60,000 Indian students. Merz’s open invitation to Indian professionals has both economic and political undertones. However, certain sensitive aspects of the diaspora community, such as cases of custody of children and deportation of students, need to be treated differently.
On matters of geopolitics, opinions differ. Regarding Ukraine, West Asia, and the Indo-Pacific, India and Germany have differing opinions. However, the focus of the visit was on dialogue, principles, and coordination. An invitation extended to Modi for subsequent intergovernmental consultations in Berlin later this year indicated an intention to maintain this momentum.
Indo-Europe, in C. Raja Mohan’s formulation, “is not an alliance, nor a substitute for NATO or the Quad.” Instead, it represents a “supplementary geometry” that seeks to leverage “the demographic scale and market of India with the industrial power and technology of Europe, and to encourage greater burden sharing in Eurasia.”
India’s “multi-alignment” is a system-bridging power blocs
Together, BRICS 2026 and the Indo-Europe initiative represent not so much parallel tracks as intertwined ones. The first fixes India in the politico-economic space of the Global South, while the second seeks to integrate India into the industrial and tech centre of Europe. In either case, the enabling structural condition is the same: an international order in which rules do not effectively govern the behaviour of great powers.
This reflects a more profound transformation in Indian strategic thinking. India is no longer seeking to restore the old order or dismantle it. Instead, it aims to learn how to function in a bipolar world by serving as a bridge rather than a hegemon.
This makes India distinct from other significant players. The United States is increasingly likely to be seen as a rule-breaker; China is trying to use its power and size to shape the rules; the European Union is still a rule-preserver, but one with weaker enforcement capabilities. India does not fit into any of these roles. It cannot impose by force, nor does it want to create dependency. Thus, there is a tendency to create an overlapping network to mitigate risks rather than to require conformity.
The Indian experience in the G20 is a precursor to this strategy, with a focus on mediation rather than mobilisation and an agenda to deliver rather than issue declarations. This thinking is now being taken forward in the context of BRICS and Indo-Europe as well.
This approach does not remove risk. The challenge of dealing with the US, China, Russia, and Europe simultaneously will remain high-risk. However, in a world with no rules, risk management may be the best kind of statecraft that is possible.
A historical coda: Europe and India in the strategic imagination
The emerging Indo-European moment does not occur in a historical vacuum. The idea of Europe and India has appeared in each other’s strategic thinking long before the current concerns in Europe with supply chains, strategic autonomy, or the aftermath of an America in turmoil.
A European perception of India characterises the late nineteenth and early twentieth centuries through the lens of empire. India was the pivot of the empire for Britain, while for the rest of continental Europe, it was a symbol of empire and a possible fault line in British primacy.
Germany’s interest in India during the First World War, evident in the activities of the Berlin Committee and the ill-fated plan to support Indian revolutionaries, was not based on any cultural or value-systemic similarities. India was important because it was a source of leverage in the larger global struggle between European nations.
For nationalists in India, Europe’s position in the strategic imagination was more complex. Europe was, at one level, the source of imperial domination, but also the site on which the rivalries of empires might be turned to advantage. The engagement of Indian nationalists with Europe was not to join Europe but to gain strategic space—a pattern that would continue through the twentieth century.
This ambivalence hardened into a doctrine after independence. The Non-Aligned Movement, among other things, represented a deliberate attempt to avoid India’s assimilation into a bipolar Cold War order led by NATO and the Warsaw Pact. Europe, divided and dependent on the United States’ security umbrella, held a small strategic place in Indian thinking. While contacts with European states were maintained, the continent as a whole was not regarded as a significant actor in international relations.
However, this view was to change only gradually after the end of the Cold War. The European Union became a regulatory and economic power, though not a strategic one. The axes of international politics for India lie through Washington, Moscow and then Beijing. Europe was significant as a market and source of technology, but hardly as a partner for balancing international politics.
The difference in the current decade, the 2020s, is not just in policy, but in mutual perception.
Europe, buffeted by the re-emergence of war on its own continent and the question of long-term American engagement, is returning to the language of strength, resilience, and self-reliance. India, faced with an increasingly bold China and an unpredictable US, is rethinking the parameters of its own bilateral dependence. Here, in this moment of simultaneous reassessments, Europe and India are beginning to view each other less as satellite entities of other power poles and more as autonomous actors facing the same systemic collapse.
This is a subtle but significant shift. The issue of Indo-Europe is not about shared nostalgia for a common past, but about a common present vulnerability. While the previous European engagement in India focused more on development assistance, normative dialogue, and trade, the current engagement is increasingly concentrated on defence industrial cooperation, critical technologies, the transition to a clean energy future, and the resilience of networked systems.
This is a subtle but significant shift in India’s calculations. Europe is not just a market or a moral counterpart; it is being recognised as a partner in its effort to hedge against chaos. For Europe, India is not just a rapidly growing economy or a strategic foil to China; it is now a significant, sovereign power that has experience in dealing with chaos without the protection of formal security arrangements.
Yet this joint process of reframing in no way abolishes the differences. The memory of history continues to count. India remains sensitive to moralising by Europeans, especially when European practices lack consistency. Europe, for its part, remains uncomfortable with India’s failure to align with the West on Russia or global sanctions.
Yet it is the capacity to retain interest in the face of all these differences that makes the Indo-European concept relevant to the current era. Unlike the era of the empire and the Cold War, the current era is not based on notions of superiority or the assimilation of ideals. It is based on the need for pragmatic coexistence in a world where no power can ensure that order is maintained.
Thus, in a way, the course of history stretches not towards alignment but towards a kind of convergence. The rediscovery of each other is not an affair of the heart but a necessity. Each is learning—that is a belated lesson in one case and an intuitive one in the other—that in the twenty-first century no one can gain autonomy alone.
Correcting an old misunderstanding
The Indo-European moment, therefore, is more about correcting an old misunderstanding than building a new partnership. For several decades, Europe has underestimated India’s strategic patience, and vice versa. The current turmoil has compelled both to rethink these views.
Whether this shift will hold will depend not on words but on action: on completing trade agreements, establishing defence collaboration, and transitioning from plans for tech collaboration to action. There is no reason to believe that history will repeat itself. But there is also no need to remind us that, when the world is going through turbulent times, the Indian and European worlds have always found a reason to look at each other differently.
The fall of the world trade order has not been replaced by anything but uncertainty. This is what India’s pursuit of Indo-Europe and its BRICS 2026 chairmanship represents.
Instead of waiting for rules to be re-established, India is learning to live without rules—through diversification, resilience, and strategic cooperation. In a world characterised by leverage rather than law, this ability—to straddle blocs without being tied down by any of them—could well be India’s most significant strategic strength.
Ramesh Jaura is a journalist with 60 years of experience as a freelancer, head of Inter Press Service, and founder-editor of IDN-InDepthNews. His work draws on field reporting and coverage of international conferences and events.
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