In house Research Archives - BRIEF

India US Tariff War

briefindia — Mon, 22 Dec 2025 12:19:41 +0000

In house Research

Sagnik Samadder|

Senior Research Associate

Tariffs and Trust: Why the U.S.-India Trade Rift Threatens a Strategic Partnership

In late August 2025, the United States took a sharp turn in its economic engagement with India, raising tariffs on Indian imports to as high as 50%[1]. The measure instantly doubled duties on a wide range of goods, from textiles and leather to machinery and gems. It was a move that stunned policymakers and traders alike, marking the steepest escalation in U.S.-India trade tensions in over a decade.

[1] https://cleartax.in/s/us-tariff-on-india

Washington framed the decision as a response to India’s “unfair trade practices” and its continued purchases of discounted Russian oil. New Delhi, however, saw it differently: as an act of economic aggression against a strategic partner. The result is a rapidly widening rift between two democracies that only recently promised to build the world’s most consequential partnership.

Till 2024, the scenario was quite different:

Product category	India tariff on US goods (MFN avg)[1]	US tariff on Indian goods (MFN avg)[2]	Analysis
Agricultural products (overall) Agricultural products (all food, fish, dairy, etc.)	36.7%	5.0%	India’s agri tariffs are among the highest globally; US agri tariffs are low on average but with some very high peaks (esp. dairy, sugar).
Electrical machinery & equipment Electrical machinery and electronic equipment	10.9%	1.2%	Covers HS 85-type products (motors, transformers, electronics, etc.).
Locomotives, aircraft & ships Transport equipment (vehicles, aircraft, vessels, rail)	20.4%	3.4%	Includes motor vehicles as well as aircraft, ships and rolling stock. India’s protection here is much higher.
Textiles (not clothing) Textiles (separate from clothing)	15.9%	8.0%	For apparel, India ≈21.3%, US ≈11.7% under “Clothing”.
Pharma Chemicals (includes organic, inorganic chemicals & many pharmaceuticals)	9.0%	2.7%	Many finished medicines enter the US duty-free or at very low rates; India commonly levies around 10% basic customs duty on pharma plus surcharges, roughly consistent with this average[3].
Precious stones Minerals and metals (includes precious metals/stones; many HS 71 lines are 0%)	9.8%	1.8%	In practice, US duty on many diamonds/gems is 0%; India’s tariffs on gold/jewellery are much higher than this average4.
Fish and aquatic products Fish and fish products	32.8%	0.7%	India treats fish more like a sensitive food product; US fish tariffs are very low on average.
Dairy products	35.6%	16.8%	Both are high by global standards; the US uses tariff-rate quotas, with some out-of-quota rates above 100%.
Plastic materials Chemicals + Rubber, leather & footwear	≈10–16% (Chemicals 9.0%; Rubber/leather/footwear 16.4%)	≈3–4% (Chemicals 2.7%; Rubber/leather/footwear 4.0%)	Plastics (HS 39) sit between chemicals and rubber in classification, so I’ve given a range rather than a single point.
Organic & inorganic materials Chemicals (organic & inorganic chemicals, etc.)	9.0%	2.7%

[1] WTO Tariffs of India on USA

[2] WTO Tariffs of USA on India

[3] Trade Policy Review

A sudden shift in trade dynamics:

One must consider the broader trajectory of U.S.-India relations to understand the shockwaves this decision sent. Over the past decade, the two nations have deepened defence cooperation, aligned on Indo-Pacific strategy, and sought to reduce global dependence on Chinese manufacturing. Yet, on the trade front, friction has never truly disappeared.

India lost its Generalised System of Preferences (GSP)[1] benefits under the Trump administration in 2019, and despite high-level assurances, they were never reinstated. Now, with the second Trump administration in power, Washington’s renewed tariff push suggests that trade protectionism has re-emerged as a defining feature of U.S. policy.

[1] https://economictimes.indiatimes.com/news/economy/foreign-trade/despite-revoking-gsp-status-in-trump-1-0-india-us-trade-surged-trump-2-0-could-continue-the-trend-sbi/articleshow/115199197.cms?from=mdr

For India, which exported USD 79.4 billion[1] worth of goods to the U.S. last year, this decision is not merely an economic setback; it’s a political insult. Commerce Minister Piyush Goyal’s response was uncharacteristically sharp: “India will not bow down.”

[1] BRIEF compilation from WITS Database

The table below provides an example of the various sectors in which India majorly excelled in exports in 2024 (values are showcased in billion USD).

India’s exports far exceed imports from the USA in the pre-tariff year (2024), indicating India’s strong electronics and components export base, possibly including telecom parts, electrical components.

BRIEF compilation from WITS Database semiconductor assemblies, pharmaceuticals, textiles and other items. India exports more in this category, likely from sectors such as aerospace parts and ship components. The USA’s exports include high-tech aerospace machinery, but India still maintains a positive balance here. India is a net exporter, supplying garments, fabrics, and home textiles to the U.S., while imports from the U.S. are minimal. India leads due to its globally competitive generic drug and API industry, though the U.S. also exports some high-value speciality chemicals. Another major surplus category for India is driven by exports of cut and polished diamonds, gold jewellery, and gems. The U.S. exports mainly uncut stones or raw precious metals.

India has a significant advantage, largely from seafood and shrimp exports. U.S. exports in this category are negligible. India exports more agricultural goods to the U.S., such as spices, rice, and tea, while importing limited agricultural produce from the U.S. This is one of the most balanced categories. Both countries trade machinery, but India maintains a slight surplus, possibly reflecting industrial parts and machinery exports. India’s exports are marginal, and imports from the U.S. are almost nonexistent, possibly due to trade restrictions and different sanitary standards. Plastics are one of the few categories where the U.S. slightly outpaces India, showing a narrow deficit for India, reflecting higher-value plastics or polymers imported from the U.S. The data underscores India’s comparative advantage in labour-intensive manufacturing and natural resource-based exports, while the U.S. holds strength in high-value engineered products and polymers.

To understand the depth and distribution of the tariff escalation, it is essential to examine the full structure of U.S. duties imposed during the 1 February-20 November 2025 period. The table below outlines the tiered system, combining country-specific, sector-specific, and emergency-driven measures that form the basis for the sharp increases now impacting Indian exports:

Additional tariffs are currently in effect on top of pre-January 2025 tariffs, based on presidential actions.

Percentage of Tariff	Country-specific tariffs imposed under the International Emergency Economic Powers Act (IEEPA)
+10-41%	Ranging from 10% to 41%, Algeria 30%, Angola 32%, Bangladesh 37%, Bosnia and Herzegovina 35%, Botswana 37%, Brunei 24%, Cambodia 49%, Cameroon 11%, Chad 13%, China 34%, Côte d’Ivoire 21%, Democratic Republic of the Congo 11%, Equatorial Guinea 13%, European Union 20%, Falkland Islands 41%, Fiji 32%, Guyana 38%, India 26%, Indonesia 32%, Iraq 39%, Israel 17%, Japan 24%, Jordan 20%, Kazakhstan 27%, Laos 48%, Lesotho 50%, Libya 31%, Liechtenstein 37%, Madagascar 47%, Malawi 17%, Malaysia 24%, Mauritius 40%, Moldova 31%, Mozambique 16%, Myanmar (Burma) 44%, Namibia 21%, Nauru 30%, Nicaragua 18%, Nigeria 14%, North Macedonia 33%, Norway 15%, Pakistan 29%, Philippines 17%, Serbia 37%, South Africa 30%, South Korea 25%, Sri Lanka 44%, Switzerland 31%, Syria 41%, Taiwan 32%, Thailand 36%, Tunisia 28%, Vanuatu 22%, Venezuela 15%, Vietnam 46%, Zambia 17%, Zimbabwe 18%. (from amendment of Executive Order 14257, Annex I[1]).
Percentage of Tariff	Sector-specific national security tariffs, Section 232 (exempted from country-specific tariffs)[2]
+50%	on iron or steel and derivatives of steel, except for the United Kingdom, 25%
+50%	on aluminium and derivatives; except for the United Kingdom, 25% and the Russian Federation, 200%
+50%	on copper and derivatives
+25%	on automobiles and parts; except for the United Kingdom (≤10%), and the European Union and Japan (≥15%)
+10-25%	on timber, lumber and derivatives; except for the United Kingdom (10%), and the European Union and Japan (≤15%)
+10-25%	on medium- and heavy-duty vehicles, their parts, and buses
Percentage of Tariff	Other tariff treatment pursuant to “deals”, “unilateral preferences” and emergency measures (IEEPA)5
+50%	on goods from India–a 25% country-specific tariff, plus an additional 25% penalty related to oil imports from the Russian Federation
+50%	on goods from Brazil–a 10% country-specific tariff, plus an additional 40% duty related to political reasons, if not exempted
+0-38%	expiry of trade preferences under AGOA for sub-Saharan African economies and the Hope/Help scheme for Haiti on the 30th September 2025
+35%	on non-USMCA-compliant goods from Canada
+25%	on non-USMCA-compliant goods from Mexico
+20%	on goods from China, including Hong Kong SAR–a 10% baseline tariff, plus an additional 10% fentanyl tariff
min 15%	on goods from Japan and the European Union, tariffs increased to 15% if they were lower; for MFN rates apply to certain products
+10%	on non-USMCA originating potash from Canada and Mexico
+10%	on non-USMCA originating energy-related products from Canada

[1] https://public-inspection.federalregister.gov/2025-06063.pdf

[2] UN Trade and Development-Overview of the United States’ tariffs

Taken together, these layered tariff measures translate into sharply uneven impacts across Indian export sectors, the effects of which are detailed in the following section.

In textiles and apparel, India exported USD 8.68 billion worth of goods to the U.S. in 2024. The U.S. imposed tariffs between 45% and 50%[1] (previously 8%), effectively eliminating India’s cost advantage over competitors such as Vietnam and Bangladesh. Analysts at India Briefing (2025) estimate that these hikes could reduce exports by 7-8%, impacting over 45 million MSME workers engaged in the sector[2].

[1] US Tariff on India: Impact, Affected Products, Rates & India’s Response

[2] How US tariffs are unraveling India’s textile industry

The gems and jewellery industry, India’s second-largest export to the U.S., valued at USD 9.15 billion, now faces tariffs of 50%4, up from the pre-2025 rate of 1.8%. The Gems and Jewellery Export Promotion Council (GJEPC) projects losses amounting to USD 3 billion in FY2025-26, particularly impacting diamond polishing hubs in Surat and gold jewellery units in Mumbai[1]. Over 1.7 million workers are at risk due to a potential relocation of U.S. sourcing to Thailand and Hong Kong.

[1] Indian gems, jewellery exports

For pharmaceuticals and chemicals, in September 2025, U.S. President Donald Trump announced a 100% tariff specifically on branded and patented pharmaceutical products, effective since October 1[1]. General tariffs of 25% or 50% were imposed on a broader range of Indian goods, but pharmaceuticals were specifically exempted, directly impacting India’s generic drug exports, which were valued at USD ~8.72 billion every year[2]. According to the Pharmaceutical Export Promotion Council of India (Pharmexcil, 2025), the new tariffs will squeeze the profits for major exporters such as Sun Pharma and Dr Reddy’s, while U.S. healthcare costs could rise correspondingly due to reduced access to low-cost generics[3].

[1] Tariffs on Pharma

[2] Donald Trump’s drug tariff spares generics, but India braces for fallout

[3] Trump’s 100% pharma tariffs

The electrical machinery and industrial equipment category, India’s largest industrial export to the U.S. at USD 18.97 billion, now faces tariffs of 30%4 (previously 1.2%). The Department for Promotion of Industry and Internal Trade (DPIIT) warns that this will erode India’s competitiveness within the China-plus-one diversification strategy, deterring investments in electronics and automotive components.

The marine and agricultural products segment, which includes exports such as seafood, spices, and basmati rice worth USD 2.3 billion, now faces tariffs of 35%4 (previously 0.7%). The Marine Products Export Development Authority (MPEDA, 2025) claimed a shrimp export reduction of 6% (from April – September 2025), due to U.S. importers shifting to Ecuador and Indonesia. This will particularly affect coastal economies in Andhra Pradesh and Gujarat. Therefore, the experts believe to emphasise the need to focus on producing and processing high-value marine products to revive the fisheries sector[1].

[1] Seafood exports, MPEDA

The locomotives, aircraft, and ships segment, covering India’s exports of railway locomotives, aircraft components, and marine vessels valued at USD 3.33 billion, now faces significantly higher U.S. tariff barriers, rising to around 50%6. However, tariffs on aircraft and aircraft components remain minimal or even zero, and, similar to aircraft, India exports very few large fully assembled ships to the U.S. market.

It is self-explanatory that these steep tariff increases, particularly on locomotives and related engineering goods, may prompt U.S. buyers to shift procurement to suppliers in Europe and East Asia. This could erode India’s competitiveness in high-value engineering exports, potentially resulting in substantial revenue losses for Indian manufacturers. The impact would be felt most in the major production clusters of Maharashtra, Tamil Nadu, and Karnataka, where heavy engineering industries are concentrated.

Economic Fallout: Exports in Jeopardy

The sectors most exposed to the tariff blow are precisely those that employ millions of Indian workers. Textiles, leather goods, gems and jewellery, automotive components and machinery will now face prohibitively high duties in their largest export market. For Indian exporters already grappling with tight margins and a strong rupee, this change could be the difference between survival and shutdown.

According to GTRI, due to these tariff increases, shipments dropped to USD 6.31 billion from USD 8.38 billion[1] between May and October 2025, coinciding with the US duties rising from 10% in April to 25% in early August to 50% by late August. The World Bank (2025)[2] projects a 6.3% reduction in Indian exports by FY26-27, saying the impact of US tariffs will dampen growth expected from the cut in GST rates and taxes.

[1] Tariff Shock

[2] World Bank Report

By October 2025, reports from Bloomberg indicated that Washington may reduce tariffs to 15-16% under a proposed bilateral trade recalibration[1]. The draft framework involves reciprocal commitments: India would grant greater U.S. agricultural access (corn, soymeal, and dairy derivatives[2]), while the U.S. would restore Generalised System of Preferences (GSP) benefits and moderate its stance on India’s Russian oil imports. Minister Goyal reiterated that “no deal will be made under pressure” (Hindustan Times, Oct 2025), highlighting India’s sovereignty-first policy stance. Meanwhile, domestic industry bodies such as CII and FIEO have urged the government to extend export subsidies and insurance credit to buffer short-term shocks.

[1] US May Cut India Tariff to 15-16% in Trade Deal

[2] Indian Market Opens for US Farm Goods as Trade Agreement Moves Forward

Next Steps for India to Curb the U.S.-India Tariff War:

A. Trade Architecture & FTA-Driven Measures:

Pursue Early Harvest Agreements: Secure quick tariff stabilisation in mutually dependent sectors, APIs, electronics components, and medical devices before a full FTA.
Negotiate Zero-Tariff Corridors for Critical Goods: Create tariff-free pathways for essential items (pharma APIs, clean energy components, data-centre hardware) to ensure continuity of supply.
Fast-Track Regulatory Alignment for Key Export Sectors: Accelerate U.S. approvals in pharmaceuticals, electronics, and digital equipment in exchange for predictable tariff schedules.
Integrate Value Chains with USMCA (Mexico & Canada): Co-produce goods where rules of origin permit partial Indian inputs, enabling tariff-free U.S. entry under USMCA.
Establish a Joint Tariff Review Mechanism under TPF: Create a technical body to anticipate tariff spikes, detect supply-chain harm, and jointly recommend rollbacks.

B. Sector-specific steps:

Sector	Strategy to be adopted
Textiles & Apparel	1. Negotiate TRQs or Tariff Exemptions for Cotton & MMF Garments: Target high-volume categories where U.S. retail depends on Indian supply. 2. Promote Product Standardisation & Scale Manufacturing: Push standardised SKUs (like basics, MMF staples) to achieve mass production efficiencies. 3. Upgrade to High-Value MMF, Technical Textiles: Move to higher-margin segments less sensitive to tariffs.
Leather & Footwear	1. Increase Value-Added Production: Shift from semi-finished leather to finished goods with higher pricing power. 2. Strengthen Clusters for Shared Processing & Lower Costs: Modernise tanning, finishing and common facilities to achieve cost reductions.
Gems & Jewellery	1. Promote Cutting, Polishing & High-Value Design Exports: Add more value domestically so margins absorb tariff impact. 2. Lower Input Duties on Rough Stones and Machinery: Reduce upfront costs and improve competitiveness in the U.S. market. 3. Expand Digital Retail Channels: Use B2C jewellery e-commerce and direct-to-consumer U.S. platforms to bypass intermediaries and retain price margins.
Automotive Components & Machinery	1. Advance Precision Engineering & Component Upgrading: Move from low-value to high-precision and electronics-integrated components. 2. Develop Scale Through Auto & Engineering Clusters: Reduce per-unit costs with shared testing labs, machining hubs, and logistics parks. 3. Deepen Regional Value Chains for Inputs (ASEAN, Africa, LATAM): Source cheaper metals, forgings, castings, and sub-components to offset tariff impact.
Marine Products (Seafood, Shrimp, Fishery Exports)	Marine: 1. Increase value-added processing (cooked, breaded, ready-to-eat shrimp) to improve margins and absorb tariffs. 2. Diversify export markets toward the EU, Japan, South Korea, and GCC to reduce U.S. dependence. 3. Strengthen cold-chain and port logistics to reduce spoilage and improve delivery speed. 4. Adopt MPEDA-led traceability and certification for premium pricing and lower rejection risks. 5. Develop aquaculture clusters with shared feed mills, labs, and processing centres to reduce per-unit costs. 6. Introduce resilient species and improved broodstock to stabilise output and reduce risk.
Agricultural Products	Agriculture: 1. Increase value-added exports (processed spices, ready-to-cook foods, oilseed derivatives) to raise margins. 2. Strengthen compliance with USDA/FDA standards to reduce rejections and secure stable access. 3. Develop specialised agri-export clusters for rice, spices, and horticulture to lower logistics and processing costs. 4. Expand markets to GCC, EU, and ASEAN to reduce price exposure to U.S. tariffs. 5. Leverage GI-based branding (Basmati, Malabar pepper, Darjeeling tea) to command premium prices.

C. Supply-chain integration with the U.S.:

Promote co-production and joint manufacturing Collaborate with U.S. firms in defence, aerospace, clean-tech, and electronics, making products jointly produced and less likely to face tariffs. In case of defence, India and the U.S. have a decade-long strategic defence framework in place to encourage collaboration on manufacturing and technology sharing. A key example is the planned co-production of GE 414 aero-engines in India. For aerospace, India’s growing aerospace industry, driven by domestic demand for commercial aviation and defence needs, provides a strong incentive for U.S. companies to partner on manufacturing and MRO (Maintenance, Repair, and Overhaul). Electronics and Clean-Tech as a sector are also key areas for collaboration, as India aims to become a global manufacturing hub and attract foreign investment.
Expand U.S. investments through targeted PLIs Attract U.S. companies in semiconductors, renewables, and electronics to deepen bilateral supply-chain interdependence. For the semiconductors, India is actively working to build its semiconductor manufacturing ecosystem, as evidenced by the recent focus on the sector and the potential for U.S. investment and technology transfer. Renewables in India have set aggressive renewable energy targets and are attracting significant international investment, making it an attractive market for U.S. companies in this sector. The goal of the supply-chain interdependence initiatives is to create deeper, more resilient supply chains between the two countries, reducing reliance on single sources and creating new opportunities for growth in high-tech industries

India now stands at a decisive juncture in its economic engagement with the United States. The tariff escalation, broad, steep, and sectorally uneven, has exposed the vulnerabilities of labour-intensive and high-value export segments while underscoring the limits of existing trade safeguards. Yet it also provides a moment for strategic recalibration. By pursuing targeted early-harvest arrangements, rebuilding cost competitiveness, accelerating market diversification, and deepening supply-chain integration with North America, India can both cushion immediate disruptions and reshape its long-term export trajectory. The coming phase of negotiations will be critical: India’s response must balance firmness with flexibility, ensuring that short-term shocks evolve into opportunities for structural strengthening rather than a prolonged economic rift.

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Public Transportation and Gender: Bridging the Mobility Gap for Women in India

briefindia — Tue, 25 Nov 2025 09:58:41 +0000

In house Research

Swati Verma

Senior Research Associate

In a nation of 1.4 billion people, public transportation forms the backbone of mobility and economic development. It connects millions to jobs, education, and healthcare, driving social inclusion and productivity. Yet for nearly half of India’s population (women and girls), this essential system often acts as a barrier rather than a bridge.

The experience of navigating India’s vast network of buses, trains, and metros is deeply gendered. While public transport is intended to be a lifeline, its accessibility, affordability, and, most critically, its safety are not experienced equally. Addressing this gap is essential to building a more inclusive and equitable mobility ecosystem.

The High Cost of Constrained Mobility

The mobility gap begins with a fundamental divergence in travel patterns. Women’s journeys are rarely linear. According to the World Bank, they are more likely to travel during off-peak hours, make multiple, shorter trips for domestic and caregiving purposes, and be accompanied by children. Compounding this, women have lower rates of private vehicle ownership, making them overwhelmingly reliant on public transport.

This reliance comes at a steep price. A 2017 International Labour Organization (ILO) study identified inadequate access to safe transportation as the single largest factor limiting women’s economic participation in developing countries, reducing it by 15.5 percentage points.

India illustrates this vividly. While female labour force participation has risen modestly, it remains far below men’s. A striking example comes from Delhi, where the resettlement of 700,000 squatters to the city’s periphery led to a 5% increase in male employment, but a staggering 27% drop for women, whose travel time increased threefold. This is not a mere inconvenience; it is a structural constraint.

The mechanism of this limitation is clear. Barriers to transport narrow a woman’s potential “job radius”, restricting her opportunities to locations within walking distance or requiring slower, less efficient modes of travel. The same World Bank report notes that 45 percent of women walk to work in India, compared to 27 percent of men, largely because they cannot afford faster transport options. The result is a crippling “time poverty,” where long, arduous commutes and the burden of unpaid care work leave little time for rest, skill development, or formal employment.

These mobility-linked constraints reinforce occupational clustering. According to the Periodic Labour Force Survey 2023–24, over 75 percent of rural women remain concentrated in agriculture, while urban women are clustered in a narrow range of sectors; about 25 percent in manufacturing, 15 percent in trade, hotels, and restaurants, and nearly 40 percent in service-sector roles such as finance, administration, health, and social work. While these patterns stem from multiple structural issues, evidence increasingly shows that transport affordability, reliability, and safety deepen these divides and limit women’s upward mobility.

Compounding this is the lack of women within the public transport workforce itself. In FY 2021–22, women made up less than 2 percent of commercial drivers authorized to operate public transport vehicles, and female conductors accounted for under 10 percent. This underrepresentation amplifies feelings of isolation and reduces perceived safety, further discouraging women from using public transport.

An Anatomy of Anxiety: The Female Commute, Stage by Stage

For many women in India, the journey to work or school is a daily exercise in risk management. In Delhi, over 90% of women reported experiencing sexual harassment in public transport settings (UN Women, 2013). A 2021 Observer Research Foundation (ORF) study revealed that 56% of women faced sexual harassment while commuting, and nearly half avoided professional or educational opportunities due to safety concerns.

To understand why this fear is so pervasive, we can map the female commuter’s journey. A recent study by the Bureau of Research on Industry and Economic Fundamentals (BRIEF), titled, Empowering Women: Unveiling the Importance of Public Transport, breaks it into multiple stages, and at every point, her freedom is chipped away:

It begins at home, with pre-planning routes to avoid “unsafe” areas, often with limited information.
It continues at the stop, with waiting in poorly lit or isolated areas.
It peaks in-transit, with overcrowded buses and trains where groping and harassment are often hidden in plain sight.
It culminates at the destination, with the insecurity of finding safe “last-mile” options to her final doorstep.

These are not isolated inconveniences but interconnected links in a chain of constraints. Critically, over 70% of respondents in the ORF study said they would use public transport more if it were safer, cleaner, and better connected. This daily anxiety is not merely a transport issue, it is a barrier to equality, limiting access to education, employment, and public life.

Charting a Path Forward: A Blueprint for Gender-Inclusive Transport

As India urbanizes rapidly, with its urban population projected to reach 820 million by 2051, the demand for safe mobility will only intensify. Dismantling this architecture of anxiety requires a systemic response that addresses each point of failure. This demands a comprehensive, gender-responsive strategy integrating policy, infrastructure, and community engagement.

Institutionalize Gender Inclusion: Transport governance must mainstream gender equality. This requires establishing dedicated R&D divisions within transport ministries and creating gender teams at state and city levels to collect disaggregated data and monitor compliance.
Enforce a Zero-Tolerance Policy: Stronger, more visible enforcement against harassment is non-negotiable. This must be coupled with public awareness campaigns and seamless coordination between transport authorities and police.
Design for Safety and Accessibility: Infrastructure must be reimagined from a woman’s perspective. This means installing CCTV cameras, improving lighting at stops and stations, providing gender-sensitive amenities like clean restrooms, and ensuring universal accessibility.
Empower a Representative Workforce: Actively recruiting and training women as drivers, conductors, planners, and administrators is crucial. This builds trust, fosters accountability, and makes the system more responsive to its users.
Foster a Culture of Collective Responsibility: Awareness campaigns in schools and communities can promote bystander intervention and challenge patriarchal norms, making public safety a shared civic duty.

Conclusion: Mobility as a Catalyst for Equality

If public transportation is to be a true catalyst for equality, then the system itself must be rebuilt with gender equity at its core. It is more than a mode of travel. It is a social equalizer and an economic enabler. For millions of women across India, it represents the tangible bridge between a life of constraint and a world of opportunity.

A transport system that prioritizes women’s safety, comfort, and accessibility will ultimately benefit everyone. It supports inclusive urbanization, increases workforce participation, and advances sustainable development. Empowering women through mobility is not only about safer travel. It is about unlocking the full potential of a nation.

The post Public Transportation and Gender: Bridging the Mobility Gap for Women in India appeared first on BRIEF.

Viksit Bharat: India’s Aspirations and Challenges

briefindia — Thu, 09 Oct 2025 09:14:06 +0000

In house Research

Vaswati Rudrapal

Research Associate

India’s Vision for 2047

India has set its sights on becoming a Viksit nation by 2047. The vision of Viksit Bharat is not limited to higher income levels. It aims for transform the country into a self-reliant and prosperous economy by 2047.

The broader goals of Viksit Bharat include:

Sustained high growth in GDP and per capita income,
Strengthening India’s position as a leader in science, technology, and innovation (STI),
Ensuring universal access to quality healthcare and education,
Enhancing social equity by reducing regional and gender disparities, and
Pursuing environmentally sustainable growth.

The journey toward becoming Viksit is thus not only about how much India grows, but also about how it grows, and how growth translates into better health, education, skills, and opportunities for all.

To qualify as a developed economy, India must meet international benchmarks of per capita income and social progress. Based on the World Bank’s current threshold for defining an advanced economy i.e. $14,006 per capita, India would need to sustain a nominal GDP growth rate of 10.19% annually from 2023-24 onwards. When adjusted for long-term exchange rate fluctuations and dollar value changes, the target rises to $18,414 per capita, requiring 11.41% annual growth (Rangarajan & Shanmugam, 2025).

However, monetary income alone does not define “development.” While economic growth is often measured through per capita income and industrialisation, true development requires proportional progress in human development.

India’s Current Standing

According to the UNDP Human Development Report 2025, India’s HDI rank improved from 133 in 2022 to 130 in 2025. India’s HDI improved from 0.447 in 1990 to 0.685 in 2023, while its GNI per capita rose from $2,167 to $9,047. This indicates income expanded by over 300%, whereas HDI increased by just 53%.

Its HDI of 0.685 keeps India in the medium human development category, just below the 0.700 threshold for high human development. Over the same period, life expectancy increased from 58.6 years in 1990 to 72 years in 2023, while expected years of schooling rose from 8.2 to 13 years (UNDP, 2025).

India's Economic and Human Development Indicators

*Indicator*	1990	2023	Growth (%)
*HDI*	0.447	0.685	53.2%
*GNI per capita*	2167.22	9046.76	317%
*Life Expectancy at Birth (years)*	58.6	72	22.9%
*Expected Years of Schooling (years)*	8.2	13	58.5%

Source: Tabulated using data from UNDP 2025

These are impressive gains, but India remains below the high-HDI threshold of 0.7. Peers such as China and Vietnam have made faster progress by investing heavily in human capital alongside economic growth.

Global Benchmarks

Countries that began at similar starting points in the 1990s have since diverged sharply in outcomes.

*Country*	HDI 1993	HDI 2023	GNIPC 1993	GNIPC 2023
India	0.458	0.685	$ 2,277	$ 9,046
China	0.52	0.797	$ 2,245	$ 22,029
Viet Nam	0.53	0.766	$ 2,723	$ 13,032
Bangladesh	0.42	0.685	$ 1,863	$ 8,497
South Asian Average	0.47	0.672	$ 2,931	$ 8,722

Source: Tabulated using data from UNDP 2025

In 1993, India, China, Vietnam, and Bangladesh were clustered closely in terms of income and HDI. By 2023, however, China surged to $22,029 per capita income with an HDI of 0.797, Vietnam reached $13,032 with HDI 0.766, and Bangladesh, despite a modest income base, matched India’s HDI at 0.685. India’s performance, while significant in absolute terms, has not matched the pace of its peers.

Over the past three decades, India’s GNIPC has grown far faster than its HDI.

Source: Created using data from UNDP 2025

Between 1993 and 2023, GNIPC increased from $2,277 to $9,046, with compound annual growth rates (CAGR) of 4.19% (1993-2003), 5.17% (2003-2013), and 4.75% (2013-2023). By contrast, HDI rose from 0.458 to 0.685, with corresponding CAGRs of 1.45%, 1.52%, and 1.08%.

This persistent divergence is reflected in the widening gap between GNIPC and HDI growth rates from 2.74 pp in 1993-2003 to 3.67 pp in 2013-2023. Without deeper investment in health, education, and social well-being, income growth alone cannot deliver Viksit Bharat.

The Pearson correlation coefficient between India’s GNIPC and HDI values for the last 30 years is 0.97, which may be interpreted as perfect correlation. While this confirms that income and human development are linked, the imbalance in magnitude of this growth highlights the structural challenge: income gains are necessary but not sufficient for proportional advances in human development.

Key Challenges

Despite these gains in India’s human development indicators, significant challenges persist. Inequality in India remains high, reducing the effective HDI by over 30%, among the highest in the region. Low female labour force participation and political representation highlight gender disparities, despite recent policy efforts (UNDP, 2024).

Educational gaps persist in quality and employability, particularly across rural and marginalized groups, undermining demographic dividends (Chatterjee, 2024). Health inequalities, including malnutrition and inadequate access to care, constrain gains in life expectancy (Bhan, 2016).

Regional disparities exacerbate inequalities, with certain states and social groups lagging behind (Chatterjee, 2024). India’s innovation ecosystem, while expanding, still invests less than 1% of GDP in R&D, constraining competitiveness (Rangarajan & Shanmugam, 2025).

Addressing these intertwined issues is critical to achieving the vision of Viksit Bharat by 2047.

Recommendation and Conclusion

Human development plays a critical role in driving economic growth by enhancing the capabilities and productivity of individuals. The Human capital theory posits that education, skills, and health improve workforce efficiency and generate increasing returns through knowledge spillovers and innovation. Moreover, economic growth itself expedites human development by increasing the resources available for investments in health, education, and social infrastructure, creating a virtuous cycle of mutual reinforcement (Ranis, 2004; Bloom et al., 2022). This dynamic interplay implies the need for balanced focus on income growth and human development necessary for a truly prosperous and Viksit nation.

India’s experience over the past three decades reflects substantial income growth, but moderate gains in human development. While life expectancy and expected years of schooling have improved, challenges remain. This highlights the urgent need for enhanced investment in healthcare infrastructure, quality education, and social safety nets.

Key Policy Priorities:

Targeted nutrition support: Expand state-specific programmes in high-burden states (such as Bihar and Madhya Pradesh) and improve primary healthcare hubs in lagging districts.
Skills for employability: Align vocational education with industry demands to bridge workforce gaps through policies like NEP and digital initiatives DIKSHA for improving access to quality education.
Data-driven monitoring: Enhance NITI Aayog’s SDG dashboard to track state-level HDI progress and inequalities.
Boost innovation capacity: Raise public and private R&D spending to at least 2% of GDP by 2030, prioritising health, education, and renewable energy.
Decentralised accountability: Introduce citizen scorecards for health, education, and social welfare schemes at block and panchayat levels.

References

Bhan, N. (2016). Health inequalities research in India: A review of trends. International Journal for Equity in Health, 15(1), 1–8. https://www.ncbi.nlm.nih.gov/pmc/articles/PMC5053026

Bloom, D. E., Canning, D., Kotschy, R., Prettner, K., & Schünemann, J. (2022). Health and economic growth: Reconciling the micro and macro evidence. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4144725
Chatterjee, S. (2024). Inclusive economic growth in India: Inducing prosperity and ending deprivations. Routledge.
Vijayakumar, N. (2025). A study on Human Development Index in India. International Journal for Multidisciplinary Research, 7(2). https://doi.org/10.36948/ijfmr.2025.v07i02.41083
Ranis, G. (2004). Human development and economic growth. Center Discussion Paper No. 887, Yale University.
Rangarajan, C., & Shanmugam, K. R. (2025). Quantitative dimensions of Viksit Bharat. Indian Public Policy Review, 5(6), 1–19.
United Nations Development Programme (UNDP). (2024). Human Development Report 2024: Equality in an unequal world. UNDP.
United Nations Development Programme (UNDP). (2025). Human Development Report 2025: Advancing human development in a changing world. UNDP.

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Arctic–MENA–Asia Trade Triangle: New Corridors, New Competitions

briefindia — Sat, 06 Sep 2025 13:07:18 +0000

In house Research

Smrithi B

Research Intern

The global trade map is undertaking an ultimate recasting, where the Arctic-MENA-Asia Trade Triangle is becoming a core pivot in a disaggregated geopolitical-economic whole. It is a fluid trade route linking Arctic, Middle East and North Africa (MENA) and Asia and is likely to cut transit times, diversify supply chains and cause new strategic alliances – although it poses acute climate and security issues.

Why the Arctic, and Why Now?

Climate change is opening the Arctic at a very high rate. Due to the melt of sea ice, new shipping routes like the Northern Sea Route (NSR) and Transpolar Route are getting more accessible, which guarantees the potential of 40 percent less transit time between Europe and East Asia than the established routes, like the Suez Canal. The transformation is an unexpected opportunity to the countries of Asia and MENA who have found substitutes to the congested/ geopolitically-sensitive choke-points such as the Strait of Hormuz and the Malacca Strait.

India’s Strategic Stakes

As a very energy-dependent country, India is taking up the role of a principal stakeholder in this new triangle. In May 2025, India had been importing 1.96 million barrels per day of crude oil from Russia, representing close to 38 per cent of the imports. This flow of energy could be greatly boosted by the time and cost in transportation using countries such as the Arctic, whose maritime routes, such as the NSR, can greatly improve this transportation. The import of discounted Russian oil helped India save 25 billion dollars in 2023-24, and the optimisation of Arctic routes would only enhance its energy security and logistics efficiency.

The 2022 Aropahika Policy of India is based on a multidimensional policy, focused on scientific study, environmental care, and collaborating with other nations, also forming opportunities for economic interaction, such as investing in Arctic-capable infrastructure and maritime logistics.

Mundra, Vizhinjam and Mumbai ports have the potential of becoming transhipment centres of Arctic and Indian Ocean trade, particularly when fitted with LNG bunkering facilities, ice-class vessel support and cold-chain logistics to support perishables and pharmaceutical exports leading rank based Indian exports with FY 2023-24 of over INR 320.2 billion.

MENA’s Pivot Northward

Arctic shipping routes present a new avenue to the MENA (Qatar, UAE) to access the energy markets in Asia. Qatar was reported to export 9.3 billion cubic feet per day of LNG in 2023, with more than 80 percent of it going to Asia, and the UAE exported 0.7 billion cubic feet per day. Such nations are considering the NSR as an alternative to avoid the Strait of Hormuz and the Suez Canal, thus improving the delivery speed and the geopolitical risks.

An existing major logistics hub like the Jebel Ali Port in the UAE could be used as a relay point in the transportation of goods destined to the Arctic, since the MENA region is a major energy exporter to Asia. Joint infrastructure, such as the creation of specialised Arctic bunkering services, might make ports in the Gulf, India, and Sri Lanka become the key facilitators of the new route.

New Trade Flows and Emerging Players

While Arctic engagement today focuses on crude oil and LNG, the potential for containerized trade, cold-chain perishables, and high-value exports is growing. India’s ambition to become a global export hub for auto components, electronics, seafood, and pharmaceuticals aligns with Arctic shipping advantages, shorter delivery times and lower costs.

Beyond India and the UAE, several strategic players are actively shaping the trade triangle:

China: Declares itself a “near-Arctic state” and is investing in Arctic infrastructure under the Belt and Road Initiative.
South Korea and Japan: Developing ice-class ships and advancing Arctic research.
Nordic nations like Norway and Iceland are leveraging geography and Arctic expertise to enhance connectivity and innovation.

Total Bilateral trade between India and Norway has been reaching INR 1.2 billion in FY 2023-24, following the cooperation in maritime energy and renewable energy. The India-EFTA TEPA in 2024 also eases the path to closer trade relationships with the Arctic-proximate countries.

Security and Governance Challenges

Despite its promise, the Arctic–MENA–Asia triangle introduces complex security risks. The Arctic’s harsh environment demands specialised vessels and rescue capabilities. Melting ice also increases the risk of accidents, oil spills, and environmental damage.

The Arctic is a geopolitically disputed region. This is because Russia, with a claim of control of a large part of the NSR, is opposed by nations such as Canada and the U.S that favour multilateral control. Maritime competition will also increase as the Arctic traffic expands, necessitating a new security framework and governance systems.

Upon the traditional sea lines, we have already witnessed lapses in the form of the ever-given blockage in the Suez Canal, rising tension in the Red Sea and the Strait of Hormuz. The Arctic offers a chance at avoiding these chokepoints on the condition that rules-based governance and infrastructure resiliency do the same.

Climate Paradox

Ironically, climate change is allowing the trade in the Arctic region, but also endangering the delicate ecosystem of the area. Unregulated increased shipping can upset indigenous populations, bring in invasive species and increase carbon emissions. Although shorter routes might help cut down global emissions, arctic warming is a dangerous global feedback loop.

Balancing economic gains with environmental protection will require inclusive decision-making and multilateral cooperation, especially involving local and indigenous stakeholders.

Rethinking Cooperation

To realize the potential of the Arctic–MENA–Asia Triangle, new forms of collaboration must emerge:

Infrastructure investment: Shared funding and technology for Arctic-capable ports, vessels, and refuelling services.
Governance and regulation: Harmonized policies for safety, environmental standards, and equitable access.
Maritime security alliances: Cooperation among Arctic, MENA, and Asian powers to secure new trade lanes.
Energy transition partnerships: Arctic–MENA–Asia synergies on renewable energy, carbon-neutral logistics, and sustainable development.

Existing frameworks, like the Arctic Council, and bilateral agreements (e.g., India-Norway, Russia-China) offer a foundation for expanded trade and climate cooperation. India, as an Observer State, should use its role to push for equitable access and sustainable growth.

What’s Next for India?

India must now align its Arctic Policy with trade, energy, and strategic priorities. Next steps include:

Investing in ice-class vessels and Arctic-ready port infrastructure
Expanding cold-chain logistics for exports
Participating in Arctic governance around maritime law and sustainability
Strengthening partnerships with Russia (energy), Norway (shipping), and UAE (logistics)

As Arctic routes become commercially viable, India must evolve from a passive observer to a strategic stakeholder, leveraging its scientific presence into economic and geopolitical advantage.

The Arctic–MENA–Asia Trade Triangle is more than a trade innovation—it’s a symbol of 21st-century geopolitics and climate-driven adaptation. As the world’s trade patterns shift, this corridor offers both promise and peril. The next decade will be crucial in shaping whether this emerging axis supports inclusive growth and sustainable development or becomes a flashpoint for competition and ecological harm. Global collaboration—between governments, corporations, and communities—will determine whether this new trade frontier is a bridge to shared prosperity or another source of tension in an already fragmented world.

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Navigating the Green Wave: How India Can Lead the Sustainable Shipping Revolution?

briefindia — Sat, 06 Sep 2025 13:00:29 +0000

In house Research

Smrithi B

Research Intern

The global maritime industry, responsible for over 80% of international trade, is at a crossroads. While shipping remains the most carbon-efficient mode of freight transport, it contributes nearly 3% of global greenhouse gas (GHG) emissions – a figure projected to rise without intervention. As climate change accelerates, green shipping has emerged as a critical strategy to decarbonize maritime logistics while maintaining economic growth. For India, a nation with a vast coastline and ambitious trade goals, embracing green shipping is not just an environmental necessity but a strategic economic opportunity. This article explores the concept of green shipping, analyses global best practices, evaluates India’s current initiatives, and outlines a roadmap for the country to become a leader in sustainable maritime transport.

What is Green Shipping?

Green shipping refers to the adoption of environmentally sustainable practices in maritime transport to minimize ecological damage. This includes the use of alternative fuels such as liquefied natural gas (LNG), hydrogen, ammonia, and biofuels, which produce fewer emissions than conventional marine fuels. Additionally, green shipping incorporates energy-efficient vessel designs, such as aerodynamic hulls and wind-assisted propulsion, as well as digital optimization tools like AI-driven route planning and predictive maintenance. The International Maritime Organization (IMO) has set a net-zero emissions target for 2050, with interim goals of 20-40% reductions by 2030. Achieving these targets requires a combination of regulatory mandates, technological innovation, and industry collaboration—areas where India can play a pivotal role.

Global Regulatory Frameworks driving Green Shipping

The transition to sustainable shipping is being propelled by stringent international regulations. The IMO’s Initial GHG Strategy (2018, revised 2023) is the cornerstone of global efforts, mandating carbon intensity reductions through the Carbon Intensity Indicator (CII) and Energy Efficiency Existing Ship Index (EEXI). These frameworks compel shipowners to adopt cleaner technologies or face operational restrictions.

Beyond the IMO, regional policies are accelerating change. The European Union’s Emissions Trading System (EU-ETS), extended to shipping in 2024, imposes a carbon price on vessels calling at EU ports. Similarly, the FuelEU Maritime Regulation enforces progressive GHG intensity limits on marine fuels. By 2028, a global carbon pricing mechanism is expected to further standardize emission costs across trade routes. These regulations create both challenges and opportunities for Indian shipping companies, which must adapt to remain competitive in international markets.

Technological Innovations powering the Green Transition

The shift toward sustainable shipping is being enabled by cutting-edge technologies. Alternative fuels like green hydrogen and ammonia promise zero-emission propulsion, though infrastructure and cost barriers remain. LNG, while not fully carbon-neutral, offers an immediate 20-25% reduction in CO₂ emissions compared to traditional bunker fuel.

Operational advancements are equally transformative. AI-powered voyage optimization systems analyse weather patterns and currents to reduce fuel consumption by 23-35%. Wind-assisted propulsion, using rotor sails or kites, can cut fuel use by 5-20%, particularly on long-haul routes. Meanwhile, port electrification and shore power systems eliminate emissions from docked vessels, a practice already adopted in leading ports like Rotterdam and Los Angeles.

India’s Green Shipping Ambitions: Progress and Challenges

India has taken significant steps toward sustainable maritime operations. The National Centre of Excellence for Green Port & Shipping (NCoEGPS), established in collaboration with The Energy and Resources Institute (TERI), serves as a hub for policy development and innovation. The Green Tug Transition Programme aims to electrify harbor tugs, while green hydrogen pilot projects at ports like Kandla signal India’s commitment to zero-emission fuels.

However, challenges persist. Renewable energy adoption at Indian ports remains below 10%, lagging behind global leaders. Biofuel supply chains are underdeveloped, and high retrofitting costs deter fleet upgrades. Additionally, India must harmonize domestic regulations with IMO standards to avoid trade disadvantages. Addressing these gaps requires public-private partnerships, increased R&D funding, and international collaboration.

Global Best Practices

Several countries offer actionable insights for India’s green shipping transition:

Norway has pioneered hydrogen-powered ferries, demonstrating the viability of zero-emission coastal shipping.
Singapore, a global bunkering hub, is investing in LNG and ammonia fuel infrastructure to maintain its competitive edge.
The EU is leveraging carbon pricing and subsidies to accelerate the adoption of clean technologies.
The Port of Los Angeles has reduced emissions by over 50% through electrification and smart grid integration.
In Australia, the Green Shipping Corridors Initiative is fostering low-carbon routes between major ports like Sydney and Los Angeles.

India can emulate these strategies by incentivizing green shipbuilding, scaling up renewable energy at ports, and fostering innovation through partnerships with global maritime leaders.

Charting India’s Course to a Sustainable Maritime Future

India stands at a pivotal moment in maritime history, where its actions today will determine its position in tomorrow’s green shipping economy. By leveraging strategic partnerships like the India-Australia Renewable Energy Partnership and technological collaborations with Norway and Japan, India is building a comprehensive framework for sustainable maritime development. These international alliances, combined with domestic initiatives such as the Green Tug Transition Program and port modernization efforts, create a powerful synergy between global innovation and local implementation.

The nation’s vast coastline, growing shipbuilding expertise, and renewable energy potential position it uniquely to become a leader in sustainable maritime trade. However, success will require sustained commitment to three critical areas: technology transfer through deepened international cooperation, workforce development to build green maritime capabilities, and policy alignment with evolving global standards.

As climate action becomes increasingly central to global trade, India’s ability to harmonize economic growth with environmental stewardship in its maritime sector will serve as a model for emerging economies worldwide. The journey ahead demands bold action, but the rewards – a cleaner environment, stronger economy, and leadership position in the new maritime order – make this transformation both necessary and inevitable. India’s maritime future must be green, and through strategic global partnerships, that future is within reach.

References

Felício, J. A., Rodrigues, R., & Caldeirinha, V. (2021). Green shipping effect on sustainable economy and environmental performance. Sustainability, 13(4256).
(2023). Initial IMO strategy on reduction of GHG emissions from ships.
(2023). A bibliometric analysis of green shipping: Research progress and challenges for sustainable maritime transport. Journal of Marine Science and Engineering, 12(10), 1787.
(2024). Can the shipping industry chart a course that delivers for the planet?
(2022). Ministry of Ports, Shipping and Waterways and TERI come together to set up India’s first National Centre of Excellence in Green Port and Shipping.
Times of India. (2025). India launches its first green hydrogen plant at Kandla port.

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India’s Growing Economic Clout in the Shadow of the US-China Trade War

briefindia — Mon, 09 Jun 2025 20:37:42 +0000

In house Research

Sagnik Samadder

Senior Research Associate, BRIEF

Key Takeaways:

Businesses are operating under growing uncertainty due to ongoing trade disputes, marked by reciprocal tariffs, para-tariffs, and a recent pause in negotiations, undermining predictability and long-term planning.

India is increasingly emerging as a pivotal hub in global semiconductor manufacturing, playing a critical role in the production of iPhones. The Indian semiconductor market is poised to expand significantly from USD 34.3 billion in 2023 to an estimated USD 100.2 billion by 2032.

India must scale production to capture the U.S. market, e.g., producing 80 – 85 million iPhones. Focus on the production of high-precision lasers, air leak testing stations, and pick-and-place machines in India is crucial, which are currently imported from China.

A pressing need for a comprehensive U.S.-India bilateral trade agreement to unlock the full potential of electronics, specifically smartphone exports to the USA.

With the recent transition in U.S. leadership aimed at addressing the trade deficit, there is a pronounced strategic shift toward tariffs and broader trade policy, leading to a growing tariff dispute between the US and China, whereby India has huge scope to boost its scope of overall production and improve its exports to the US. After a series of reciprocal tariffs, para-tariffs and other non-tariff barriers being implemented with the recent temporary pause, businesses are facing uncertainties now. India, on the other hand, is uniquely positioned to serve both as a reliable ally and a pivotal economic counterweight for the U.S. India has positioned itself to champion a new global order, which is more pragmatic than rigid and away from conflicts. For the USA, a partner in the global south with such a balance can become an asset, as in India’s partnership with the US is compounding its rise to become its biggest stakeholder. As of 2024, China remains the United States’ third-largest trading partner, while India ranks twelfth, with bilateral trade between India and the U.S. totalling USD 129.2 billion, whereas China has a bilateral trade of USD 582.5 billion in 2024. This highlights the imperative for India to enhance its competitiveness and deepen economic engagement to capture a larger share of the U.S. market.

As of April 11, 2025, the United States has raised the base tariff on all imports from China to 145.0%. Effective May 2, the de minimis exemption for shipments under $800 from China will be suspended, subjecting these imports to full tariff enforcement. On April 13, a temporary exemption was granted for selected electronics, such as smartphones, laptops, integrated circuits, and storage devices, though the 20% fentanyl-related tariff remains in place. China, which supplies 24.7% of all U.S. electronic imports, now faces a 100.0% tariff on semiconductors, potentially driving up costs for electronic component procurement. A recent declaration sheds light on reducing the reciprocal tariffs by both the US and China from 145% to 30% and 125% to 10%, respectively, applicable for the next 90 days, yet the reduction of tariffs on the electronic items is unclear, pushing businesses to rely solely on uncertain conditions for a prolonged period.

Electrical machinery and its parts thereof, along with mechanical appliances, machinery, nuclear reactors, boilers, toys, games and sports requirements are mainly among the heavily tariffed commodities, particularly exported the maximum by China to the USA, in which India carries a major scope. The following chart shows the top commodities exported by China and the corresponding export share by India to the USA in 2024. There is a cumulative export of the said products by China, valued at USD 212 billion in 2024. In contrast, India had exported only USD 12.5 billion in 2024, opening immense scope to boost the Indian exports to the USA.

Dissecting the chapter on “Electrical machinery and equipment and parts thereof”, there are certain finished goods or intermediary goods produced by China on which the USA levies additional tariffs as the ‘Reciprocal tariff’. For example, Chinese-made battery parts (non-lithium-ion batteries), lithium-ion electrical vehicle batteries, and lithium-ion non-electrical vehicle batteries experience an additional rate of 25%, apart from the ad-valorem duty of 10% by the USA. On electric vehicles, the tariff has been quadrupled from 25% to 100% in 2024. Semiconductors will experience a 100% increase in tariff in 2025.

Detailed List of US Tariffs on Chinese Imports of electrical items or parts thereof in 2024:

Battery parts (non-lithium-ion batteries)	Increases rate to 25% in 2024
Electric vehicles	Increases rate from 25% to 100% in 2024
Lithium-ion electric vehicle batteries	Increased rate from 7.5% to 25% in 2024
Lithium-ion non-electrical vehicle batteries	Increase rate from 7.5% to 25% in 2026
Semiconductors	Increase rate from 25% to 50% in 2025
Solar cells (whether or not assembled into modules)	Increased rate from 25% to 50% in 2024
Steel and aluminium products	Increased rate from 7.5% to 25% in 2024

Indian semiconductors, copper and critical minerals are exempted from any type of tariffs by the USA. Even the tariff rate of 54% on the Chinese smartphone imports, the analysts are under the notion that the price of a top-end Apple iPhone could jump to $2,300 from $1,599. But with a moderate tariff of 26% on the India-made smartphones in 2025, there lies opportunities for India to focus on this particular sector.

India’s exports of smartphones, including other parts of the phones and various apparatus for transmission or reception of voice, images or other data, both wired or wireless network, have been increasing consistently since 2019, earning a positive trade balance of USD 6.96 billion in 2024, and making India the third largest smartphone exporters after China and Thailand. The trend highlights a significant opportunity to broaden India’s export footprint, particularly in the United States, where Indian exporters hold a distinct comparative advantage over counterparts in China, Vietnam, and Thailand in reinforcing global supply chains. Moreover, the strategic relocation of manufacturing operations by global technology giants such as Apple, Samsung, Google and HP to India further amplifies the country’s position as a critical node in the international electronics value chain. As competing nations grapple with rising trade costs, India’s capacity for resilient, cost-effective production is likely to sustain its appeal among global buyers, positioning the country as a preferred hub for high-tech manufacturing and export.

The upward trajectory can be attributed to the enhanced domestic production capacities, bolstered by the Indian government’s schemes like the Production-Linked Incentive scheme. To fully capitalise on these opportunities, India needs to focus heavily on improving its ease of doing business, ensure policy stability and invest in logistics and infrastructure.

Exports and Imports of smartphones, including other parts of the phones
Year	Gross Exp. in USD Billion	Gross Imp. in USD Billion	Trade Balance in USD Billion
2019	0.24	0.38	-0.14
2020	0.44	0.42	0.03
2021	0.60	0.40	0.19
2022	1.53	0.59	0.94
2023	4.94	0.25	4.69
2024	*7.26*	*0.30*	*6.96*

Source: Author’s computations.

Strengthening supply chain infrastructure is crucial in this domain as increased investments in robust logistics and supply chain networks can ensure timely and efficient delivery of the products, enhancing the reliability for the US buyers and importers. Alongside, adhering to the international quality standards can position the Indian smartphone items as premium offerings, appealing to the discerning consumers in the US. Trade Agreements focusing on electronic items, especially cell phones, semiconductors and other required equipment, can act beneficial for the country itself. Investing in R&D can lead to the creation of cutting-edge technologies and products, establishing India as a hub for innovation in the electronics sector.

Talks are going on about Apple shifting to Indian manufacturing companies to enhance their production. Yet, predictions say that India would need to double its production to meet the US iPhone demand. Considering the already existing iPhone production capacity of Indian manufacturers, to satisfy the US consumers, India should now produce approximately 80-85 million iPhones. Along with the improved investments by Apple, partner companies like Tata Electronics, Foxconn, and Pegatron should also be enhancing their capacities.

The manufacturing bases in India for the improved production of iPhones will be enhanced further in the years to come. Already, Apple had assembled iPhones worth USD 22 billion in the FY2024- 25, a 60 per cent increase year-on-year. India’s production enhancements are in full swing, with Foxconn’s Bangaluru plant being operational by next month, bolstering production up to 20 million units. However, there is a hurdle from China, hindering the path to bolster the production in India, by delaying the supply of the crucial key manufacturing equipment required for the final assembly. Along with this, the shipments of the specialised manufacturing equipment to India are repeatedly being hindered in the Chinese ports.

The Chinese government has reportedly intensified its scrutiny of exports to India, specifically targeting advanced manufacturing equipment such as high-precision lasers, air leak testing stations, and pick-and-place machines, which are crucial for the final assembling of the iPhone. In light of this development, strategic measures should be undertaken to bolster domestic production capabilities in these critical technology segments. Keeping aside the geo-political reasons, India should focus on bettering the quality standards to meet the international standards. Reports speak that Tata’s Hosur factory, which produced iPhone casings, had a yield rate as low as 50%, wherein half of the components failed the rigorous quality checks by Apple. While India doesn’t have a mandatory Bureau of Indian Standards (BIS) standard for iPhone cases, adhering to the following international safety and quality practices is highly recommended:

Restriction of Hazardous Substances (RoHS) Compliance: Ensure materials are free from harmful substances like lead, cadmium, and phthalates.
Military standard or MIL-STD-810G Drop Testing, required for the rugged cases
Scratch resistance, UV resistance, and thermal durability testing for premium products, like the Pro and Max.

The semiconductor industry is growing at a remarkable pace, which will contribute positively to the enhanced production of iPhones. India’s semiconductor market was valued at US$34.3 billion in 2023 and is projected to reach US$100.2 billion by 2032, growing at a CAGR of 20.1% over the forecast period. The improved semiconductor environment will reduce the supply chain dependence. The current scenario showcases that Apple and its contract manufacturers, such as Foxconn, Pegatron, and Wistron, are relying mainly on imported semiconductors from China, Taiwan, and South Korea. Local semiconductor fabs will shorten the supply chains, reducing the dependence on foreign suppliers and mitigating the risks arising from the geopolitical tensions. Local semiconductor production will make India’s iPhone manufacturing more cost-efficient, agile, and geopolitically resilient, enabling Apple to scale its India operations and reduce reliance on China and Taiwan.

The scenario also demands the signing and ratification of the India-USA Bilateral Agreement, with a specific chapter on the electronic items, specifically mentioning the tariff concessions from both ends for a seamless and smooth way to trade electronic items, including phones and their parts thereof. This agreement will also nullify the effect of para-tariffs, reciprocal trade measures, and export restrictions (especially from the U.S. on sensitive technologies) on the supply chains.

Certain areas demand immediate reforms to enhance the Ease of Doing Business (EoDB) in India, which is essential for accelerating the growth of iPhone and other smartphone exports. India currently faces delays in customs clearance, and port congestion increases lead time. Implementing end-to-end digital clearance, single-window customs, and priority clearance for electronics components and finished goods is the need of the hour. Complex tax filing and overlapping state and central regulations increase operational burden. To curb this issue, India needs to harmonise the compliance requirements, reduce the Goods and Services Tax disputes, and ensure prompt refund of export incentives. Another step could be the creation of plug-and-play parks with cutting-edge technology, established on the pre-approved land, including utilities like power, water and improved logistics with better roads and internet connectivity, tailored for electronics manufacturing.

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South Asia’s Twin Deficits of Trade and Trust

briefindia — Tue, 20 May 2025 19:19:49 +0000

In house Research

Bhanavi Bahl

Research Assistant, BRIEF

The recent border standoff between India and Pakistan has altered the contours of South Asian geopolitics. For India, the idea of South Asia is increasingly defined by its eastern counterparts—where fostering deeper economic and diplomatic ties with neighbours like Bangladesh, Nepal, and Bhutan has become the cornerstone of its regional engagement strategy.

A region that once epitomized ancient civilizations and fostering unity for over four millennia, now grapples with the challenge of rekindling interconnectedness in its fractured landscape. Emerging as the least integrated region in the world, with intra-regional trade accounting for less than 5% of its total trade, South Asia finds itself at the helm of political turmoil and trade disintegration. Yet, amidst tensions, South Asia is presented with the opportunity to unlock its dormant trade potential by facilitating economic and trade integration.

Amidst the ongoing political estrangement between India and Pakistan, India’s regional trade posture is undergoing a clear eastward shift. With formal cross-border trade suspended and diplomatic dialogue at a standstill, the prospects for India–Pakistan economic cooperation remain bleak—undermined further by recent military standoffs, steep tariffs, restrictive visa regimes, and entrenched non-tariff barriers. Over the last few years, India has been recalibrating its strategy by deepening ties with its eastern neighbours such as Nepal, Bhutan, particularly Bangladesh, under former Prime Minister, Sheikh Hasina’s regime.

This pivot is not without precedent. Initiatives like the BBIN (Bangladesh, Bhutan, India, and Nepal) have offered glimpses of integration. Yet, despite these glimpses of sub-regional level integration, the broader South Asian regional architecture remains gridlocked by geopolitical frictions, institutional inertia and infrastructural deficits that hamper connectivity efforts.

Encouragingly, in the past India’s diplomatic engagement gained traction with Bangladesh, with renewed focus on connectivity, energy cooperation, and trade facilitation. This shift in India’s strategic posture comes at a time when regional economic integration is more essential than ever—particularly in the wake of heightened global protectionism and inward-looking economic policies such as America’s sweeping tariff hikes, which exposed the vulnerabilities of over-reliance on distant markets; making the case for resilient and regionally embedded trade partnerships stronger than ever.

In that vein, this article outlines the importance of economic integration for a region where borders once figured as lines of connection not division. In doing so, it establishes the detriments of low trade integration as the world copes with burgeoning fragmentation with economies. In that regard, the discussion is then steered towards Nontariff Barriers (NTBs) and Non-Tariff Measures (NTMs) in South Asia, and how these must be addressed to boost economic integration in the region, in turn facilitating India’s foothold in South Asia through greater value chain integration, similar to Southeast Asia.

Fragmented Growth: South Asia’s Rising Intra-Regional Disconnect

A trend of low economic complementarity reverberates through the subcontinent that marrs trade relations. As a case in point, despite geographical proximity, trade between India and Bangladesh accounts for only 10-12% of Bangladesh’s trade and a mere 1% of India’s trade, even at the peak of our trade relationship. Border and connectivity challenges make trading with Germany more feasible for both countries than trading with one another. Analysis also guides one to argue that apart from politics in the region, low connectivity, similar trade baskets further dampen prospects of higher intra-regional economic integration.

This reality underscores not the absence of potential, but the magnitude of opportunity that remains untapped. Regional economic integration, if pursued, could reinvigorate intra-regional trade. The barriers that currently stifle trade could, with strategic cooperation and political will, pave way to a new era of economic integration—one where proximity becomes an advantage.

Owing to the significant development and GDP growth of South Asia’s economies, this growth has been largely disconnected, as our economies expand individually but fail to align regionally. As a result, the trade gap between neighbors continues to widen, accompanied by a deepening trust deficit. Instead of fostering partnerships within our home ground and neighborhood, we increasingly look outward, forging economic ties globally while neglecting opportunities for collaboration within the region.

While South Asia’s economies have accelerated impressively on the global stage—expanding their collective trade with the world from USD 84.8 billion in 2015 to over USD 126.4 billion in 2024—regional economic integration remains conspicuously weak. Intra-regional trade continues to hover well below USD 100 million, with recent years even witnessing a downturn. This paradox is striking: as individual economies thrive, the region as a whole drifts further apart.

Though intra-regional trade has edged up slightly—from an early base of around 5% to approximately 6–8% of total trade in the past two years—this growth is not only modest but also fragmented. Rather than evolving in concert, South Asian economies appear to be rising in isolation. The result is a widening trade gap among neighbours, compounded by a deepening trust deficit shaped by persistent political tensions and divergent geopolitical allegiances.

Weaving Regional Strength: Integrating South Asia’s Textile Value Chain

Figure 4 and 5 : Regression Analysis on South Asia’s Textile Trade

The figures above are an attempt to capture South Asia’s trade complementarity in textiles. Textiles being one of its top commodities that have high trade volume. Its textile exports amounted to USD $ 78 billion in 2023, contributing roughly 7.3% to the global textile industry. Despite being at the helm of this industry, South Asia remains remarkably disconnected within its own region. With Bangladesh, India, and Pakistan leading the charge, South Asia has firmly established itself as a global powerhouse in textile production. And yet, as the figures above reveal, this dominance has not translated into deeper regional trade integration.

The scatter plots tell a perplexing story, feeding into one of the causes of low trade complementarity in the region. On the left, South Asia’s textile trade with the European Union shows a clear, consistent upward trajectory. Exports to the EU have grown in a highly linear fashion, underpinned by a striking R² value of 0.98, reflecting strong trade complementarity. This is a classic case of economic alignment: South Asia produces low-cost, high-volume garments, while the EU offers a stable consumer market. The relationship is well-defined, mutually beneficial and reinforced by trade facilitation mechanisms such as the EU’s GSP+ scheme. In sharp contrast, the chart on the right — mapping intra-South Asia trade in textiles — paints a fragmented picture. Trade volumes within the region are modest, and the overall correlation between imports and exports is weak (R² ≈ 0.45). For a region with such concentrated textile capacity, this is a puzzling disconnect. The reasons, however, are primarily structural and political.

First, South Asian countries have largely overlapping trade baskets. Most are exporters of similar goods — cotton yarn, home textiles, and ready-made garments — leading to competition rather than complementarity. Second, the region has failed to develop integrated value chains, where, for example, one country supplies yarn and another manufactures garments. Instead, each economy has built an export-oriented textile sector aimed largely at Western markets.

To overcome this fragmentation, South Asia must adopt a collective strategy focused on Regional Value Chain (RVC) Integration. Such an approach would enable countries to specialize in different segments of the textile value chain based on their comparative advantages, thereby unlocking the untapped potential of intra-regional trade. India, as a global leader in cotton and yarn production, stands at producing 25 million 480 lb Bales of cotton, contributing 21% to the global cotton production.

Undoubtedly, it is therefore well-positioned to anchor the upstream end of the chain. Bangladesh (USD 52 billion) and Sri Lanka, (USD 5.6 billion) with their strengths in garment manufacturing and finishing, can drive the midstream and downstream stages. Meanwhile, Nepal and Bhutan can play a crucial role in the emerging segment of sustainable textile inputs, such as biomass-based and natural fibres like wool, nettle, and hemp—products increasingly in demand in ethical and eco-conscious markets.

By aligning production roles within a complementary framework, South Asia can move from fragmented competition to cohesive cooperation—laying the foundation for a more resilient and integrated regional textile industry.

Third, political tensions and logistical inefficiencies continue to undermine regional trade. Sensitive border relations — especially between India and Pakistan — a lack of cohesive cross-border infrastructure, and protectionist trade policies have eroded trust and stymied collaboration. As a result, South Asia trades more confidently with Brussels than with its own neighbours.

This dissonance between global integration and regional fragmentation is not just ironic — it is inefficient. While the world readily absorbs South Asia’s textile output, the region itself has failed to leverage its shared strengths. Unlocking this potential will require more than trade agreements. It will demand strategic supply chain planning, targeted investment in infrastructure and connectivity, and above all, political will.

The Role of NTBs and NTMs in South Asia

The textiles industry is one such example amongst myriad other commodities, where South Asia’s intra-regional trade potential remains largely unrealized. At the core of stagnated integration efforts lie the pervasive imposition of Non-Tariff Barriers (NTBs) and Non-Tariff Measures (NTMs)- creating an atmosphere clouded by mistrust and hesitance in South Asia. These barriers, ranging from bureaucratic delays to inconsistent standards and regulatory hurdles, discourage seamless trade flows, undermining the very aims of such projects. Addressing these systemic issues is critical not only to reviving the vision of initiatives such as BBIN but also to unlocking South Asia’s vast trade potential.

To overcome this, South Asia must prioritize reducing NTBs and NTMs through policy harmonization, mutual recognition of standards, and streamlined customs procedures. This is complemented by a cooperative political environment, where trust and shared economic goals take precedence over historic tensions. By tackling these barriers, South Asia can attempt to transform its fractured trade landscape into a model of regional integration, creating lasting benefits for its people and economies alike.

Examining the manifestation of NTBs and NTMs necessitates a parallel focus on addressing the structural barriers that enable them. One prominent manifestation is the lack of adequate infrastructure and facilities at border points, which hinders the seamless flow of trade across the region. For instance, the absence of storage facilities and incapacities to handle large volumes of consignments, delays the timely clearance of goods- a challenge frequently observed at several of India’s border points. Similarly, despite four border check points between India and Myanmar, its regional cross-border trade has been 1% consistently, with only the Moreh-Tamu ICP (Integrated Check-Post) as operational. Apart from unfavorable domestic political drivers, insufficient infrastructural development at these points prevents the maximizing of trade potential between these economies.

A second major challenge is the lack of harmonized and standardized quality of goods across the region. Establishing common standards would ease trade by reducing regulatory barriers is thus crucial. Taking from the case of Southeast Asia, that has achieved great feats in intra-regional trade over the years, accounting for almost 22% of total ASEAN trade, this can largely be attributed to the implementation of the ASEAN Guidelines for Harmonization of Standards that was primarily aimed at facilitating intra-regional trade of electrical goods and machinery, making it the top traded commodity. In 2023, it accounted for US$53.5 billion or 37.5% of Singapore’s intra-ASEAN exports. Similarly, Malaysia, another major intra-ASEAN exporter, recorded US$92.2 billion in trade, with electrical goods comprising a significant share of its exports within the region.

In a similar manner, as previously suggested in a report published by BRIEF, developing mechanisms that facilitate cross-border PGA (Partner Government Agency) cooperation and recognition between bodies like the FFSAI (Food Safety and Standards Authority of India) or the BIS (Bureau of Indian Standards) with other national agencies in South Asia such as the SLSI (Sri Lanka Standards Institution) will contribute to jointly implementing or complying with standards of goods across borders, provide quality assurance and in turn boost trade across the region.

By exploring the establishment of practices such as NTB-Free Economic Zones, which function similarly to Special Economic Zones (SEZs), could be beneficial. These zones can be developed with the aim to reduce barriers at border points that restrict the trade of certain goods. By identifying high-priority sectors such as textiles and agriculture which contribute to large volumes of trade to South Asia, that also witness higher percentages of risk inspections- the countries can focus on developing unified Risk Management Frameworks at border points to expedite the movement of goods through reduced barriers in customs procedures and eventually foster a conducive environment for trade and investment. In a similar fashion, developing Green Channel clearance facilities at border points can significantly reduce trade delays and enhance cross-border efficiency. By streamlining customs procedures and allowing expedited clearances for low-risk and compliant traders, that are identified and given certifications based on prior checks; such facilities could reshape cross-border trade amongst South Asia’s neighbors. This feature necessary for border points between India and its neighbors like Bangladesh and Nepal, where logistical inefficiencies and regulatory bottlenecks have long stalled trade.

With increased connectivity projects at border points through the sustained efforts by bodies like the LPAI (Land Ports Authority of India) over the years, South Asia stands at a critical juncture that challenges its regional trade facilitation, especially as domestic politics continue to set the tone for neighborhood relations. Thus, the journey to overcoming these obstacles is not merely an economic necessity but also a step towards the revival of South Asia’s legacy of unity and interconnectedness. By prioritizing collective economic progress over historic divides, and drawing from successful examples of harmonized standards of goods in ASEAN and implementing measures such as Green Channel facilities, South Asia can chart a new course by filling trade gaps through procedures that mend its trust deficits.

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The post South Asia’s Twin Deficits of Trade and Trust appeared first on BRIEF.

As Pakistan and Bangladesh get close, India should be watchful

briefindia — Fri, 25 Apr 2025 09:29:03 +0000

In house Research

Afaq Hussain

Director, BRIEF

This article was published in the Indian Express

While India was committed to its eastern neighbourhood through the Act East Policy and the Neighbourhood First Policy, the latest developments should alert India to be cautious.

Since Sheikh Hasina’s overthrow in August last year and the visit of Pakistan’s Foreign Secretary Amna Baloch to Bangladesh this week, there has been a renewed friendship between the two nations. For decades, their relations were strained, particularly during Hasina’s tenure. But in the last few months, they have warmed up to each other through multiple economic and diplomatic initiatives including direct shipping routes, enhanced trade, a relaxed visa regime, and a proposed visit of Pakistan’s Foreign Minister to Bangladesh at the end of April.

Under Sheikh Hasina and Narendra Modi, ties were built on pillars like trade, connectivity-linked infrastructure, people-to-people initiatives, culture, etc. But the recent revocation of a transhipment facility by India for exports from Bangladesh to third countries, and the existing ban on the import of selected Indian products by Bangladesh, has adversely impacted this relationship.

Trade ties had witnessed a significant surge in the last decade and a half, reaching around $12 billion in 2024, as India became the second-largest exporting country to Bangladesh. These strong numbers were supplemented by multiple initiatives apart from the natural advantage offered by geographical proximity. Initiatives on the infrastructure and connectivity front in the form of Integrated Check Posts (ICPs) at multiple border points, transit rights, trade corridors, and maritime cooperation treaties like access to India for the Chattogram and Mongla ports were instrumental in boosting ties.

While India was committed to its eastern neighbourhood through the Act East Policy and the Neighbourhood First Policy, the latest developments should alert India to be cautious. Bangladesh is India’s largest trading partner in South Asia. Given India’s historical and present ties with Pakistan and the creeping influence of China, cooperation with Bangladesh was a critical fillip to the former’s dominance in South Asia.

Bangladesh and Pakistan’s renewed friendship, along with the China factor, does present strategic and security challenges for India.

Unfortunately, India will now have to maintain a strict vigil at another border — the one shared with Bangladesh. The situation along the border of civil war-torn Myanmar, which is in the vicinity of the India-Bangladesh border, brings further complications.

Bangladesh is scheduled to graduate out of the Least Developed Country status in 2026, which would mean more tariffs on exports, fewer incentives for its exporters, and stricter standards and compliances in international markets. All of this would eventually lead to higher costs, and perhaps direct competition with India’s exports, particularly in the ready-made garments segment.

While Pakistan-Bangladesh trade is yet to show any significant progress, bilateral trade between India and Bangladesh has come to pre-August 2024 levels. Amidst global economic turmoil, it is important for both India and Bangladesh to not give up on the bilateral and regional connectivity initiatives. One of the key success stories of India-Bangladesh cooperation was the operationalisation of “Border Haats”, which had a significant impact on border economies through enhanced trust, people-to-people connect, local livelihood generation, and women’s empowerment.

India should be watchful of the overall developments with respect to Pakistan-Bangladesh as well as the influence of China; but at the same time, should not give up its role as a leading country in South Asia and let other countries drive the political and economic narrative in the region.

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The post As Pakistan and Bangladesh get close, India should be watchful appeared first on BRIEF.

Skills, Youth and Employability: India’s Quest for Economic Empowerment

briefindia — Tue, 31 Dec 2024 11:05:39 +0000

In house Research

Pratik Dake

Bureau of Research on Industry and Economic Fundamentals

Photo credit – Youth Futures

Education is the Manifestation of the Perfection Already in Man’

Swami Vivekananda, Prose: What We Believe In

Youth, often referred to as ‘YuvaShakti’, are powerful agents of change driving progress and development[1]. The National Youth Policy 2014 defines youth as the individuals between the ages of 15 to 29 years. India is home to one of the youngest populations in the world, with youth accounting for 27[2]% of the total population. However, this share is expected to decline to around 24% in the coming years. Despite this, the absolute number of youths will remain substantial, reaching approximately 365 million by 2030. This demographic shift presents an opportunity for a ‘Youth Bulge’ that can help propel India toward its the national goal of a USD 5 trillion economy.

[1] National Youth Policy 2021

[2] Project Figure for the Year 2021, National Youth Policy 2014

Following the adoption of the International Year of Youth in 1985, the Government of India established a separate Department of Youth Affairs and Sports[1], which led to the formulation of the National Youth Policy in 1998, 2003, 2014 and 2021. To fully harness the potential of youth, it is essential to ensure they acquire the right skills necessary for future growth.

[1] Ministry of Youth Affairs and Sports

An economic trigger occurs when a country has more people available to work than those to feed. With the significant shifts in the India’s skilling ecosystem and the shortcomings of past skill development programs, there was a clear need to reassess the existing skill development framework. As a result, the National Policy on Skill Development and Entrepreneurship was introduced in 2015. Skill development is a shared responsibility among all stakeholders in the ecosystem.

Over the past few years, the Government of India has launched numerous schemes targeting skilling, employment, and entrepreneurship. The Pradhan Mantri Kaushal Vikas Yojana (PMKVY), one of the flagship initiatives, was launched on World Youth Skills Day. By the end of Year 2020, it had trained approximately 1.05 crores youth through Short-Term training (STT) and Recognition of Prior Learning (RPL) Courses[1]. Ambitious programs such as Make in India, Startup India, Deen Dayal Upadhyaya Grameen Kausalya Yojana (DDU-GKY), National Apprenticeship Promotion Scheme (NAPS) play a crucial role in supporting youth through skill development. In addition to skill development, higher education is an important contributor to Science, Technology and Innovation (STI), benefiting both individuals and society. The Gross Enrolment Ratio (GER) for higher education was reported as 27.1% in the year 2019-20, compared to 24.5% in 2015-16 and 20.8 % in 2011-12[2].

[1] Ministry of Skill Development and Entrepreneurship

[2] All India Survey on Higher Education (AISHE) 2019-20

Source: Annual Report on Periodic Labor Survey Report (PLFS), MoSPI

The labor force participation rate of young aged 15 to 29 has risen from 38.20% in 2017-18 to 46.50% in 2023-2024. Additionally, the youth unemployment rate, which stood at 17.8% in 2017-18, decreased significantly to 10.20% in 2020-21; although it remains relatively high.

The GoI incurred an expenditure of around 1289.20[1] crores for the last financial year 2023-24 under various schemes of Ministry of Skill Development and Entrepreneurship (MSDE). The allocation of the budget to the youth agenda remains constant at an average of nearly 18% across all ministries, with over 50% of the expenditure committed to three ministries, the Ministry of Education, the Ministry of Social Justice and Empowerment and the Ministry of Skill Development and Entrepreneurship[2]. The budget allocated to youth development remains at 0.01% of India’s GDP[3], which is significantly lower than that of less develop countries such as Nepal and Bahrain (0.2% of GDP) and Bangladesh (0.1% of GDP).

[1] BUDGET ALLOCATION FOR ENTREPRENEURSHIP AND SKILL DEVELOPMENT PROGRAMME

[2] National Youth Policy 2021

[3] Ibid

In addition to revisiting the allocation of financial resources for the Youth Agenda, it is crucial to focus on emerging employment areas both within India and globally, particularly regarding cross-country talent demand. Job roles in the country focusing on green jobs, renewable energy, electric vehicle manufacturing, green mobility, robotics, machine learning, AR/VR should be supported through targeted interventions and programs, similar to Finland’s Talent Boost Initiative[1]. This initiative emphasis on promoting cross-sectoral cooperation between the states, cities and business sector for talent attraction and retention with an aim of boosting international skill mobility channels.

[1] Talent Boost – Ministry of Economic Affairs and Employment

One of the major challenges in current skilling programs is the lack of coordination between the numerous initiatives operating at both the state and central levels, leading to duplications of efforts. There is a need for a clear distinction among programs focused on skilling, reskilling, and upskilling to effectively achieve the desired targets. A key factor for the successful implementation of skill development programs is a robust mobilization strategy[1] and accurate mapping of training needs, ensuring that youth are well-informed about vocational opportunities and the labor market. As a result of these gaps, only 54% of certified candidates under the PMKVY scheme are placed[2].

[1] article-skill.pdf

[2] Pradhan Mantri Kaushal Vikas Yojana (PMKVY) | Placement Dashboard

India’s Skilling Paradox highlights a significant challenge: while agricultural opportunities are shrinking, there is a growing demand for skilled workers in manufacturing and services, yet the gap in essential skills remains vast. The 21st century job market will not only require task-specific roles but also multidimensional competencies that combine technical expertise with adaptability. To bridge the gap, India must develop a comprehensive blueprint for transferable skills that align with both current and future industry needs. This can be achieved by leveraging the efficiencies of the private sector through its direct participation in skill development and training programs. While this approach has already been initiated, it requires a more strategic focus in its implementation. In addition to focusing on employability, this approach should prioritize the portability of skills to ensure long-term, sustainable employment. By fostering adaptability, India will be better equipped to address future employment challenges arising from the rapidly changing economic landscape.

The post Skills, Youth and Employability: India’s Quest for Economic Empowerment appeared first on BRIEF.

From Big Brother to a Leader: Modi’s Soft power surge in South Asia

briefindia — Tue, 22 Oct 2024 10:50:56 +0000

In house Research

Rishabh Sachdeva, Research Assistant

Bureau of Research on Industry and Economic Fundamentals

Photo credit – Aspenia Online

Introduction

Soft power isn’t a mere concept it is the society-driven activity that drives India’s public diplomacy, especially under PM Modi and EAM Jaishankar. From Mandir diplomacy to Vaccine maitri, diplomatic initiatives and cultural outreach today are a calculative attempt to garner and reshape India’s projection as a formidable force in the South Asian Theater. India’s image revolved around Bollywood, Bomb, Bangalore and Boy Next Door, over the past decade Modi’s governance stands as a compelling case for India’s soft power owing to his dynamic personality and diplomatic outreach, cultural exchange and people-to-people contacts, an emphasis on digital diplomacy. While India has great triumphs globally with something as major as the Hindu temple in UAE, to multiple accolades from the Indian music industry owing to an Oscar to ‘Naatu-Naatu’ and a Grammy for the album ‘This Moment’, it is crucial to understand how India has elevated its soft power in the South Asian region. The article will explore how the BJP and Modi administrations, throughout their two terms, have actively cultivated soft power. It will examine their efforts, the resultant impact, and their endeavor to transition from the perception of a ‘Big brother’ or a bully to that of a ‘Vishwaguru’, or global mentor.

Religion Tourism

The connections between South Asia and Southeast Asia are deeply rooted in shared civilizational ties, characterized by similarities in art, culture, cuisine, and, notably, religion and religious practices. Tourism possesses the ability to draw visitors while also conveying cultural and governance perspectives. Religious places have become some of the most visited and appreciated destinations in the world, not only for adherents but for general tourists as well and India is a hotspot for religions like Hinduism and Buddhism as most adherents of Buddhism are outside India. The Buddhist Circuit, encompassing key sites in Gautama Buddha’s life, and the Ramayana Circuit, tracing the epic journey of Lord Rama, serve as significant tools of India’s cultural diplomacy, especially in South Asia. These circuits showcase India’s rich heritage, and religious diversity, and foster connections with Buddhist-majority nations in Southeast and East Asia, and Hindu communities globally, respectively They contribute to India’s soft power by promoting its spiritual significance and boosting tourism in India.

Border Haats

Another initiative by India is the Border haats which are local markets established along the borders of India with neighbouring countries such as Bangladesh and Myanmar. These haats serve as platforms for cross-border trade and cultural exchange, allowing residents from both sides to buy, sell, and interact with each other. The impact of border haats is significant as they promote economic cooperation, enhance people-to-people contact, and foster mutual understanding between communities living along the border regions. By facilitating trade and commerce at the grassroots level, border haats contribute to poverty alleviation, economic empowerment, and regional integration. Moreover, they serve as symbols of goodwill and cooperation between India and its neighbouring countries, showcasing India’s commitment to peaceful coexistence and collaboration in South Asia.

Vaccine Maitri

India today envisions being the pharmacy to the world, and the true test for this was COVID-19 vaccinations. India’s Vaccine Maitri program is a significant initiative aimed at providing COVID-19 vaccines to countries around the world, including those in South Asia. Launched by the Indian government, the program reflects India’s commitment to global health cooperation and solidarity, particularly in the face of the COVID-19 pandemic. Out of the 150 countries supported by India, 29.44% of total vaccines were given to South Asia some as gifts and some as exports. The Vaccine Maitri program demonstrates India’s commitment to global health and solidarity. By providing COVID-19 vaccines to neighbouring countries, India enhances its soft power in South Asia and beyond. Through vaccine diplomacy, India strengthens bonds of friendship and trust while promoting regional cooperation and stability, reinforcing its position as a key player in addressing public health crises.

Act East Policy and Soft Power

In 2014, PM Modi renewed its emphasis on South Asian relations with an update from the Original ‘Look East policy’ to a new and dynamic ‘Act East Policy’. Now this policy primarily has had hard power dimensions in the context of economic cooperation and business, but this policy has also enabled an expansion of its soft power by using the region’s historical ties and cultural legacy. Act East policy (AEP) has led to India’s support to restore temples in Cambodia and Nepal along with development and cooperation initiatives to build infrastructure through projects like the India-Myanmar-Thailand Trilateral Highway and the Kaladan Multi-Modal Transit Transport Project. India’s large diaspora in South Asia also serves as a bridge to foster cultural ties.

India as Vishwaguru

India’s ambitions to become a beacon of wisdom and ‘Vishwa guru’ world teacher elaborating upon. India’s aspiration to embody the world’s teacher reflects a profound acknowledgement of South Asia’s colonial history and deep civilizational ties. Through the title of Vishwaguru, India seeks to revive the collective wisdom of the region in a global political discourse largely dominated by Western ideologies. This vision not only offers an alternative perspective but also highlights the rich intellectual heritage that has often been overlooked. By asserting its strategic vision, India not only reinforces its influence within the South Asian region but also asserts its rightful place on the global stage, advocating for a more inclusive and diverse representation of ideas and values. The impact of this narrative resonates through cultural diplomacy, forging lasting connections that extend beyond geopolitical considerations. As India asserts itself as a beacon of knowledge and virtue, it strengthens its influence, creating a narrative that emphasizes cooperation, inclusivity, and shared heritage in the diverse tapestry of South Asia.

Big Brother – Being Bully or Being Generous

India’s image as a “big brother” in the South Asian region has been a subject of both admiration and criticism. While some view it as a symbol of protection, guidance, and leadership, others perceive it as an assertion of dominance and hegemony. The notion of India as a big brother reflects its geopolitical significance and historical ties with neighboring countries, as well as its responsibility to promote stability and development in the region. However, this image can also evoke concerns about India’s intentions and the potential for unequal power dynamics. Conversely, India’s idealism and generosity are embodied in its efforts to promote cooperation, mutual respect, and shared prosperity among South Asian nations. Through initiatives such as the Vaccine Maitri program and infrastructure development projects, India demonstrates a commitment to regional integration and collective well-being. Striking a balance between its role as a big brother and its ideals of generosity and inclusivity is essential for India to effectively navigate its relationships in the region and uphold its principles of diplomacy and soft power.

Conclusion

India’s transition from a perceived “big brother” to an embodiment of idealism and generosity in South Asia marks a significant shift in its soft power dynamics under Prime Minister Modi’s leadership. Through strategic initiatives like the Vaccine Maitri program, border haats, and the Act East Policy, India has effectively projected itself as a global mentor, or Vishwaguru. These efforts not only strengthen regional cooperation and connectivity but also redefine India’s role as a responsible and benevolent actor on the world stage. By leveraging its cultural heritage and historical ties, India is reshaping narratives of cooperation and inclusivity in the South Asian region, solidifying its position as a leading force in shaping the region’s future. As India continues to navigate its relationships, striking a balance between its guiding role and its ideals of idealism and generosity remains crucial for maintaining its soft power influence and fostering enduring partnerships in the region.