Introduction
US hegemony provided relative stability, through the international rules-based order, to the unipolar world that emerged post the Cold War era. This stability has now come under strain, as China has grown to be a great power militarily, economically, industrially, and technologically, leading to increasing great-power competition. Also, economic interdependence, built painstakingly as a guarantor of peace and prosperity for all, has increasingly become an instrument of coercive statecraft. Additionally, multilateral institutions are now increasingly incapable of restraining the powerful. Tariffs, export controls, sanctions, and control over critical supply chains are now routinely being used, alongside the military, as tools of coercion. This is what scholars describe as the weaponisation of interdependence, which states that control over network hubs can turn economic and financial linkages into leverage.
This has a direct impact on the middle powers, including India. India’s External Affairs Minister has opined that India should continue to reform economically and grow faster democratically while continuing to “engage America, manage China, cultivate Europe, reassure Russia, bring Japan into play, draw neighbours in, extend the neighbourhood, and expand traditional constituencies of support.” Strategic autonomy is the organising idea of Indian foreign policy. This idea has deep roots in Indian thought, from the non-alignment of yesteryears evolving into multi-alignment.
However, a declared principle that sounds nice in theory and in speeches may not possibly be put into practice in an uncertain world. This article argues that autonomy is not self-executing, but depends on what a state can defend, produce, finance, innovate, and endure. Strategic autonomy is not simply the freedom to make independent choices; it is more the capacity to sustain those choices and manage the consequences.
China is the classic example. Despite fierce competition with the United States, and while being a competitor, it was yet invited for summit meetings, as both sides had considerable strategic leverage over each other, and military confrontation was not a viable option for both. So, they got together and decided to manage competition through communication, cooperation, and negotiations between themselves to prevent the Thucydides trap.
Strategic leverage can help middle powers like India to be invited to the negotiating table in an uncertain world in a state of flux. Middle powers need to be at the negotiating table, or else PM Mark Carney’s prescient remark that “if we’re not at the table, we’re on the menu” will come true.
A World in Flux
Four features define the above phrase. First, great-power rivalry, noticeably between the United States and China, is a central fact of international politics. Second, economic interdependence is being exploited for strategic ends—semiconductors, rare earth minerals, finance, digital infrastructure, sanctions, and shipping lane choke points all confer leverage. Third, multilateral bodies from the United Nations Security Council to the WTO are constrained by the rivalries that these institutions were built to manage. Fourth, the Russian intervention in Ukraine in February 2022, which is ongoing, and the United States intervention in Venezuela, Iran, and talks of Greenland as a 51st state—all of this has happened within the recent past.
These are all scenarios that have led middle powers to pause and think. The international rules-based order offered predictability and a measure of protection. As predictability erodes, protection must increasingly come from within these states, as a state dependent on others for technology, energy, finance, or weapons will find its autonomy narrowed when it matters the most, whatever its diplomatic posture or skills may be.
The US-China Summits and the Middle Powers Dilemma
The United States and China have had two summit-level meetings, one each in Beijing and Washington. The statements at the end of these G2 summits show that the two are openly shaping the strategic, economic, and technological environment. The two are competing on certain issues, cooperating on a few, and ignoring others that are fundamental and contentious to their interests. Thus, it seems that the G2 will bilaterally decide to compete and cooperate, and it seems like a given that every other country will have to operate in the environment created by these bilateral summits. The very discussion of a more transactional US–China compact has already forced capitals across the Indo-Pacific, Canada, India, Europe, and the rest of the world to recalculate their options to safeguard their vital national interests.
As PM Mark Carney had presciently said during his speech at Davos on 20 January 2026, there was “a rupture, not a transition” in the world order. This rupture will force states to choose sides due to pressure through many channels, which include technology alliances, supply chain realignments, tariffs, financial systems, sanctions, energy security, and security partnerships.
India’s position is complex. It shares democratic values, an influential diaspora link, and growing defence and technology links with the United States. Even so, this partnership has experienced volatility. India has seen multiple changes in tariff policy since April 2025, with duties being announced, suspended, withdrawn, and replaced at different points. The tariff has been varying, from most favoured nation status to 50 percent until now, with the latest sword hanging over India being the 100 percent Russia-linked tariff threat, even while President Trump signs a diesel deal with Russia to cater to the US domestic agricultural, home heating, and transportation sectors. Whatever the eventual outcome, this tariff episode shows how quickly a friendly relationship can acquire coercive overtones.
India shares a contested border and an unresolved military standoff with China. It depends on it economically through trade. China overtook the United States to become India’s largest trading partner in 2025-26, with bilateral trade of USD 151.1 billion and a trade deficit that widened to USD 112.15 billion. China is India’s top supplier in all eight major industrial product categories. China is thus India’s principal strategic competitor and a key supplier to its factories.
India values strategic autonomy, which dictates that it must keep the freedom to choose. It does not wish to be a dependent partner on either the United States or China to resist being coerced; yet it cannot stand apart, as it is dependent on trade with them. Thus, its strategic challenge is to engage both from a position of growing strength—taking what is useful and needed, resisting what is coercive, and reducing the dependencies that give others leverage over its choices.
India’s Challenge – Lessons from Two Models
Firstly, Chinese state capacity. China proves that sustained, coordinated state action can achieve infrastructure revamps at extraordinary speed, build deep manufacturing ecosystems, align industrial policy with technological ambition, and maintain planning horizons insulated from electoral cycles. But the costs of this model include constrained freedoms, limited accountability to the citizens, suppressed dissent, and the risk of large misallocation when errors cannot be openly challenged. For India, the challenge is state execution, not the political form.
Second is the United States and its democratic mobilisation. The US strength lies in an open society, competitive universities, deep capital markets, talent immigration policies, and a capacity to mobilise in crises, from wartime industry to the Space Race, to the semiconductor, internet, and artificial intelligence (AI) revolutions. Its dynamism has relied on a partnership between a state that funds basic research and creates early demand, and a free private sector that commercialises and scales; the unique academia-industry compact that conducts research and sees the fruits of the research in terms of useful applications and products. Despite all its polarisation, its democracy retains a capacity to self-correct. Yet it also shows gridlock and promulgates policy that unsettles partners.
China shows what a state that can compel can do; the United States shows what an inspired society can do. India’s challenge is to find a path wherein the state becomes more capable, while the society stays free.
India’s Development and Institutional Challenges
Economic and Industrial Base. World Bank data shows that manufacturing contributed only 13 percent to the GDP in 2025. Formal job creation has lagged the needs of a young workforce, which is touted as India’s demographic dividend. Without job creation and the required skill sets, this dividend is not cashable. Production-linked incentives and electronics and semiconductor missions are significant but must deepen domestic supply chains rather than produce assembly operations reliant on imported components. The China trade data above shows how far that task remains. India is still strategically dependent on imports, with an import dependency index of 68.1 percent in 280 of the tracked strategic products. Some of these imports help India scale up exports too, besides being utilised only for domestic consumption; oil, mobile phones, and pharmaceuticals are everyday examples.
Technological Capability. India’s gross expenditure on R&D stands at about 0.64 percent of GDP, as per the Economic Survey of 2025-26. Private industry contributed less than 50 percent until 2023-24 and has crossed 50 percent in recent years. The R&D figures are much lower than other countries like Israel (5%), South Korea (4.8%), the United States (3.5%), Japan (3.3%), and China (2.4%). The private sector’s rising R&D share is a positive and necessary correction. However, it is not sufficient to close the technology gap with the countries it wants to compete with; the United States and China spend 2.4 – 3.5% of GDP, with about 70% of it coming from private industry. Understandably, private R&D in India follows sectors that promise near-term commercial returns: generic and specialty pharmaceuticals, IT services and software products, automotive components and EVs, and consumer-facing digital technologies. “These sectors are undoubtedly important for boosting exports and generating employment, but they are not fully aligned with the areas most consequential for India’s strategic autonomy and long-term economic security: semiconductor fabrication, advanced materials, critical minerals processing, defence and aerospace systems, foundational AI models, and clean energy storage.”
Military Capability. India accounted for 8.2 percent of global arms imports in 2021–25, making it the second-largest arms importer, after Ukraine. Russia’s share of India’s arms imports fell from 70 percent in 2011–15 to 40 percent in 2021-25, which is an encouraging sign. However, this was the result of diversification towards suppliers from France, Israel, the United States, and an expansion in domestic design and production. Diversifying suppliers is good, but it is not the same as self-reliance or atmanirbharta. Credible deterrence along two contested borders, sea lanes used to transport energy supplies, and in the Indian Ocean region requires a defence industrial complex capable of innovation at scale, faster procurement processes, and jointness among the services.
Institutional Capacity. The deepest constraint is the state’s machinery of governance, which has limited specialist expertise in the civil services bureaucracy, is prone to delays, slow regulatory and judicial processes, fragmented centre-state coordination, weak local finances, and uneven implementation. The problem is less about plans and is mostly tied to delivery. Lateral specialist entry, performance-based accountability, and data-driven systems are key to aiding efficient and effective delivery.
Human Capital. Autonomy ultimately rests on the people manning various systems. School learning outcomes, public health, skill development, and women’s workforce participation matter as much strategically as any weapon system. A demographic dividend that is not educated, healthy, and employed becomes a liability.
The Way Forward – Strengthen the State Without Weakening the Republic
This is the only way forward for a diverse and free country like India, constituting over 1.4 billion diverse—in every conceivable way—human beings. Observing China’s progress since the late 1970s, one may conclude that rapid capability development requires centralisation, that pluralism is a luxury, and that dissent is a drag. This would be an error, normatively and strategically. The US model has shown that a democracy that delivers does not rely on centralisation or conformity. Instead, it relies on legitimacy, institutions, trust, valuing talent, and freedom of enterprise.
Domestic legitimacy is a strategic asset, which sustains cohesion in an extraordinarily diverse country; it channels disagreement through institutions rather than unrest; it generates credible information through a free press and independent courts; and it attracts partners who value predictability. Economic dynamism depends on trust in contracts and courts, which erodes when power is unchecked. Freedom of enterprise, expression, and inquiry is also the engine of the kind of innovation that India needs in an uncertain world.
The goal, then, is a state that is strong because it is accountable: one that delivers infrastructure, regulation, justice, and security effectively; invests patiently in science and industry; treats federalism as a strength rather than an obstacle; and earns consent rather than manufacturing it. Capacity and liberty need not be rivals. Intelligently designed, each reinforces the other.
Conclusion
India will continue to be evaluated by the gap between its ambitions and its capabilities. Declaring strategic autonomy is easy; sustaining it requires an economy that can withstand coercion, technologies that cannot be held hostage by others, armed forces that deter, institutions that deliver, and a society united by freedom rather than fear. The aim is not to avoid dependence, which is impossible in an interconnected world, but to ensure that no dependence becomes a veto over national choices.
If India can combine the state capacity China has shown with the democratic energy America has historically mobilised, while avoiding the pitfalls of each, it can offer something rarer than either: a large, diverse, and free society that is also strong. In doing so, it will preserve its own autonomy and widen the space for other middle powers to chart their own course. The old order no longer exists; the contours of a new one are still emerging. Between these two lies a period of uncertainty and experimentation.
Finally, India’s task is to build the economic, technological, institutional, military, and industrial foundations that allow it to determine its own future and sustain the choices on which that future depends. Strategic autonomy provides the freedom to choose, but only national capability or power can make that freedom meaningful as well as realistic.
Header Picture Credit: Representative Image Generated using AI
Author: Wg Cdr JP Joshi
Twitter: @AirPowerAsia
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