India’s rise over the past decade as an economic and geopolitical powerhouse has not only transformed its domestic landscape but has also recalibrated the balance of power across South Asia and beyond. With a GDP projected to exceed $3.7 trillion in 2023 and defence spending topping $76 billion, India has fortified its role as a regional hegemon. Strategic partnerships with the United States, Japan, and Australia through platforms like the Quad, coupled with its growing clout in multilateral institutions such as BRICS and the United Nations, have allowed India to assert its interests more confidently. For neighbouring Pakistan, the implications are particularly significant, ranging from shifting Gulf alliances and diplomatic setbacks on Kashmir to growing economic disparities and strategic isolation.
India’s geopolitical rise is rooted in both economic performance and diplomatic agility. As one of the fastest-growing major economies, India has become a preferred destination for foreign investment and strategic cooperation. Its status as the world’s fifth-largest economy in nominal GDP and third-largest by purchasing power parity has enhanced its ability to influence trade corridors, maritime security, and diplomatic narratives. The U.S.-led "Indo-Pacific" strategy increasingly positions India as a counterbalance to China's assertiveness, making it a central pillar in global containment efforts against Beijing. This new stature has drawn in support from the West, particularly the United States, which backs India’s aspirations for a permanent seat at the UN Security Council and greater influence in global decision-making bodies.
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The implications of India’s ascension are wide-ranging across the region. First, it has strengthened its geopolitical stature through strategic partnerships. New Delhi’s defence modernization, underscored by its $76 billion military budget, reflects its ambition to project power in the Indian Ocean and beyond. Joint military exercises with the U.S., Australia, and Japan have elevated its profile and signalled its readiness to shape the regional security order.
Second, India’s growing military power bolsters its political leverage. With a modernized navy, advanced missile systems, and increasing surveillance capabilities, India has fortified its control over critical maritime routes in the Indo-Pacific. These developments, backed by strong defence ties with the West, position India as both a stabilizing force and a strategic rival in an already tense nuclear triangle comprising China, India, and Pakistan.
Third, India’s economic expansion encourages regional trade and connectivity. Projects such as the Bangladesh-Bhutan-India-Nepal (BBIN) initiative and infrastructure investments in Sri Lanka and the Maldives have allowed New Delhi to expand its economic footprint. Its role as a regional lender and trading partner has sidelined smaller economies and drawn them closer into India’s orbit, in part by offering an alternative to Chinese investments under the Belt and Road Initiative.
Fourth, India's strengthened position has raised the stakes in the Kashmir dispute. The revocation of Article 370 in 2019, which stripped Indian-occupied Kashmir of its autonomy, has been met with muted responses from key international players. Gulf countries, previously sympathetic to Pakistan’s position, have refrained from criticising India, with some even labelling the issue as "internal." This shift reflects a broader trend of India’s successful diplomatic overtures, as evidenced by separate Independence Day greetings from U.S. leadership—President Biden congratulated India directly. At the same time, Pakistan received a message from the Secretary of State.
Fifth, India’s rise increases the risk of direct confrontation with China. The border clashes in Ladakh, the strengthening of India-Japan defence ties, and India’s participation in joint Indo-Pacific exercises point toward heightened tensions. India’s growing strategic importance has prompted Chinese countermeasures, including satellite surveillance and aggressive posturing in disputed territories, further entangling regional dynamics.
For Pakistan, these developments present serious challenges. The erosion of Islamabad’s influence in the Muslim world, particularly in the Gulf, is a visible consequence. As India strengthens its trade and energy partnerships with the UAE and Saudi Arabia, Pakistan’s own ties with these states have stagnated. India has capitalized on Pakistan’s diplomatic inertia, positioning itself as a reliable economic and strategic partner to Arab capitals.
The Kashmir issue has suffered as a result. Following India's revocation of Article 370, Gulf states either remained silent or endorsed New Delhi's move as a sovereign matter. Kuwait and the UAE, traditionally seen as sympathetic to Pakistan, chose to prioritise their economic interests, reflecting India’s growing sway in Arab foreign policy. For Islamabad, this diplomatic drift is a major setback in its international advocacy on Kashmir.
Furthermore, India's assertive opposition to the China-Pakistan Economic Corridor (CPEC) has created additional hurdles. New Delhi views Gwadar port as a potential Chinese naval outpost and has responded by bolstering its maritime presence in Oman through the Duqm port, potentially undermining Chinese and Pakistani maritime ambitions. India’s strategic positioning in initiatives such as the I2U2 (India, Israel, the UAE, and the United States) further demonstrates its commitment to countering Chinese influence, which indirectly affects Pakistan’s regional projects.
Pakistan’s economic standing also continues to suffer in comparison. While India and the UAE aim to double their trade to $100 billion, Pakistan expects just $25 million in combined investments from the UAE and Saudi Arabia over five years. This widening gap underscores not only differing economic trajectories but also the shifting perceptions of reliability and potential among foreign investors.
In response, Pakistan and China are recalibrating their strategic outlook. For Islamabad, this has involved reinforcing its alliance with Beijing, as well as reasserting its position on Kashmir in multilateral forums such as the Shanghai Cooperation Organization (SCO). Yet these moves are met with mixed success. China’s growing regional aggression, whether in the South China Sea or Taiwan, could further complicate Pakistan’s attempts to balance its security interests with diplomatic moderation.
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Critically, India’s rise has not only marginalised Pakistan diplomatically but also exposed its strategic vulnerabilities. Islamabad now finds itself grappling with the consequences of diplomatic inertia, economic stagnation, and waning global relevance. While China remains a strong partner, Pakistan must diversify its alliances and rethink its foreign policy orientation to avoid further isolation. This includes revisiting its ties with the Gulf, enhancing regional trade cooperation beyond China, and investing in economic diplomacy to project itself as more than just a strategic counterweight to India.
In conclusion, India’s ascent as a global economic and political force is reshaping South Asia’s strategic framework in unprecedented ways. With deeper defence alliances, stronger economic networks, and growing diplomatic influence, New Delhi has firmly asserted itself on the world stage. For Pakistan, this changing landscape demands a fundamental reassessment of its strategic posture, foreign alliances, and diplomatic tools. The path forward will require agility, diversification, and a long-term vision, without which Pakistan risks further marginalisation in a rapidly evolving regional order.
