Strategic road to geopolitical buoyancy

This article is authored by Vivek K. Chandy, joint managing partner and Archana Tewary, partner, JSA Advocates and Solicitors.

The global order is being reshaped by war, trade fragmentation, energy price shocks and an increasingly uncertain macroeconomic landscape. In a fragile world economy, marked by persistent external volatility, India’s economy and markets have demonstrated a remarkable ability to absorb shocks while sustaining growth momentum.

International Relations

In the face of fundamental changes to the way countries and governments engage with each other and the consequent impact on economies, climate imperatives and technological disruption, India’s path to geopolitical buoyancy will depend on its ability to combine strategic resilience, economic competitiveness, corporate agility and regulatory foresight to navigate a rapidly evolving global environment.

In an increasingly complex environment where alignments amongst countries shift frequently and there may be different alliances at play in political and economic spheres, India has emerged as a rare example of strategic agility. Its ability to maintain productive relationships with blocs that on the surface are at loggerheads, such as the US, Russia and China simultaneously is often viewed as a difficult balancing act. The approach has led to difficult conversations at multiple levels for the stakeholders involved, often questioning whether the historic non-alignment adopted by India aligns with the global reality today. Yet, what appears to be geopolitical ambiguity is, in reality, a source of economic strength.

India has recognised that it must lean into its weight as a global market, while also diversifying the market for its own supply so that its growth is less dependent on relationships with any one country or region. At the same time, India has recognised that it must build itself as a self-sufficient market for both the supply and consumption of various goods and services. For years, global players have prioritised entry into the Indian market as a growth strategy, and it is time for India to also recognise its own strength in this regard. Initiatives such as the Indian Semiconductor Mission, alongside growing investments in AI infrastructure, advanced manufacturing, aerospace and defence, reflect a long-term effort to build resilient domestic capabilities in critical sectors.

Recent trends further reinforce this strategy. Economies at the forefront of the AI revolution, including the US, Taiwan and South Korea, continued to attract significant technology-led investment despite heightened geopolitical and economic uncertainty, underscoring how technological leadership is increasingly shaping capital flows and strategic influence. As AI fundamentally reshapes various industries, being an early adopter of the technology can be an unbeatable advantage, however, such adoption must have appropriate guardrails at a policy level as well as at the implementation level.

For Indian corporations pursuing global growth, expansion is no longer a two-dimensional exercise in market entry. It is a three-dimensional chessboard where regulatory foresight, tax efficiency, data stewardship, and cultural intelligence must operate in harmony to sustainably de-risk international ambitions.

Historically, governance discussions centred on the risks associated with inbound foreign investment into India. Today, that dynamic has fundamentally reversed. Indian corporations are deploying capital globally, transforming cross-border risk management into a strategic boardroom imperative.

Cross-border tax structures, in particular, demand careful planning from inception. With the implementation of the OECD’s Pillar Two framework introducing a global minimum corporate tax rate of 15%, multinational enterprises face heightened scrutiny of cross-border structures, reducing the scope for tax arbitrage and increasing the importance of substance-driven operating models.

The regulatory perimeter is also expanding rapidly. While data privacy remains a board-level concern, governments must now implement, and companies must now contend with a new generation of digital regulations covering AI, cybersecurity, platform accountability, and cross-border data governance.

Labour and cultural considerations are equally critical. In knowledge-intensive sectors, where human capital constitutes the primary source of value, governance failures often emerge not from financial missteps, but from an inadequate understanding of local workforce realities, leading to talent attrition and potentially severe legal liabilities.

As businesses navigate these expanding realities, the broader geopolitical environment is simultaneously reshaping trade relationships, capital flows and strategic economic alliances.

As western economies increasingly adopt protective measures - such as tariff restructurings on software and technology exports and limit access to technologies developed for other countries - India must actively diversify its economic alliances. Excessive dependence on a limited set of trading partners leaves economies vulnerable to external policy shifts and geopolitical disruptions.

To hedge this risk, India is aggressively pursuing comprehensive bilateral trade agreements with diverse economic partners, including the UK, the European Free Trade Association (EFTA), Australia, Japan, Brazil, Venezuela and West Asia. Simultaneously, India is strengthening commercial ties across SE Asia and Africa to expand market access and improve export competitiveness.

Further, the global scramble for rare earth minerals requires a highly pragmatic approach to import dependencies. While India possesses substantial mineral reserves, it continues to face constraints in downstream processing and rare-earth magnet manufacturing. Maintaining commercially viable trade relationships, even with geopolitical rivals such as China, therefore, remains essential to safeguarding access to critical industrial inputs and supporting long-term manufacturing ambitions.

This emphasis on resilience extends beyond trade and industrial policy. It is increasingly reflected in the way Indian corporations approach governance, sustainability and stakeholder accountability.

While certain western markets are experiencing a political and corporate pullback from Environmental, Social, and Governance (ESG) mandates, India's corporate ecosystem is moving along an increasingly mature, highly stringent trajectory. Today, in the domestic market, a failure in corporate governance represents an immediate threat to corporate survival, board longevity, and institutional funding.

The Securities and Exchange Board of India (SEBI) has institutionalised accountability through the Business Responsibility and Sustainability Reporting (BRSR) core framework for top listed companies. In fact, more than half of these companies already comply with non-mandatory provisions of the code, guided by independent directors and audit committees with governance as a key compliance feature. Even for the unlisted companies, ESG compliance is robustly enforced by institutional investors who conduct independent ESG due diligence as a prerequisite for capital deployment.

Simultaneously, Indian regulatory bodies and consumer protection laws are aggressively targeting greenwashing, requiring sustainability claims to be supported by verifiable recorded data and disclosures. Legal advisors, therefore, are no longer merely interpreting corporate statutes; they are becoming strategic partners who help organisations navigate environmental, regulatory and reputational risks while preserving long-term access to capital.

The road to a developed India will never be a straight, predictable highway. It will be a complex path requiring continuous adjustment to global supply shocks, intense regulatory overhauls and shifting competitive alliances. Yet, by combining disciplined regulatory foresight, robust corporate governance and an unyielding commitment to self-sustainability, India Inc. possesses the unique capacity to turn global macroeconomic turbulence into a profound industrial and structural transformation.

(The views expressed are personal)

This article is authored by Vivek K. Chandy, joint managing partner and Archana Tewary, partner, JSA Advocates and Solicitors.