Editorial 1: ​​​Navigating the global economic transformation

Context

India and the Global South can join hands to build a fair new economic system for all countries.

Introduction

The world’s economic order is changing fast. The U.S. and China are caught in a major power struggle, each building its own economic network to protect its interests. This global shift is altering trade routes, currency systems, and strategic plans. Yet, within this change lies a rare chance to create a fairer and more balanced world order.

Analysing New Economic Paradigms

1. State–Capital Nexus

• Populist leaders are joining hands with big businesses.
• They give special treatment to a few rich companies that help them hold power.
• Public wealth is traded for private gain, hurting ordinary citizens.
• This weakens the social contract between people and the state.

2. Resurgence of Power Politics

• Crony capitalists influence national leaders to revive old-style power games.
• The U.S. is reworking its global strategy to protect its dominance.
• It presses Taiwan to shift chip production, secures Panama routes, and controls rare earth supply in Africa and Central Asia.
• It mixes digital currency and foreign policy to expand reach.
• Such moves create rival “zones of influence” and spark new conflicts.

3. Digital Colonialism

• Big Tech and cloud giants reshape economies and influence politics.
• They control data, media, and financial systems.
• This digital power supports populist leaders who restrict digital rights.
• Over 100 central banks are testing digital currencies, which could weaken national independence.

Result:
While digital systems make transactions faster, they also erode economic freedom and transparency, deepening global inequalities.

Opportunity in Crisis

1. Lessons from Global Disruptions

• Economic shocks bring new chances for countries like India and China, which led the world economy for most of history.
• The old model of neoliberal globalisation focused on profit, cheap labour, and exploiting nature.
• This system created huge debt, reduced funds for welfare, and handed public assets to private elites.
• The result was extreme wealth gaps between the Global North and the rest of the world.

2. Deepening Inequality

• The World Bank’s 2022 report says nearly half of the world lives below the $6.85/day poverty line.
• About 735 million people still suffer hunger.
• These harsh conditions create frustration and social divides.
• Populist leaders often use this anger to push undemocratic agendas.

3. Building a Fairer Economic Order

• India and the Global South must not accept an unjust system.
• They can collaborate to design a New Economic Deal that helps all nations.
• India should seek reform of global financial institutions to ensure fair representation.
• It must also push for debt-relief frameworks to help developing nations regain freedom from unfair conditions.
• Through BRICS and South-South cooperation, India can lead new alliances and promote fair trade.
• To keep relations strong, India should build bipartisan ties with key partners like the U.S., Bangladesh, and Nepal — not just government-to-government links.

Need for a Recalibration

1. Rethinking India’s Growth Path

• India must make a clear course correction to reach its true potential.
• The private sector helps growth and creates jobs, but it focuses mainly on profit.
• The state must take the lead in key areas like energy, defence, space, health, and education.
• A strong public role ensures security, equal access, and national self-reliance.

2. Preventing Corporate Dominance

• India needs strong anti-monopoly laws to stop a few firms from gaining control.
• Setting up a sovereign wealth fund, like Norway’s, can help manage national savings wisely.
• This fund can invest profits from public assets back into people’s welfare and national goals.
• Redirecting public sector units (PSUs) to act like China’s state-owned enterprises can boost both revenues and global influence.

3. Investing in Knowledge and Digital Sovereignty

• India must invest deeply in science, research, and education.
• Giving academic freedom will make innovation faster and more meaningful.
• The digital-financial system should follow constitutional values like equality, justice, and transparency.
• Aligning technology with national goals will protect both citizens’ rights and India’s independence.

Conclusion

India stands at a defining crossroads in a rapidly changing world economy. To turn global disruption into opportunity, it must blend state-led vision with inclusive growth. By reforming financial systems, strengthening social foundations, and championing South–South cooperation, India and the Global South can together build a fair, resilient, and balanced global order rooted in justice and shared prosperity.