2025 proved to be a year of crises for India, marked by military tensions with Pakistan and economic challenges, according to the Financial Times. Trade disputes with the United States, a weakening rupee, and internal unrest further worsened the situation. Experts say India struggled to maintain strategic autonomy in global affairs.
The report highlighted several key issues. Military skirmishes with Pakistan strained New Delhi, while delays in US-India trade agreements created economic pressure. Limited GST reforms slowed growth, and rising oil prices added to financial stress. The rupee lost value against the dollar, signaling weakened investor confidence.
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US-India tensions were compounded by Pakistan’s stronger diplomatic and military ties with Washington. Experts cited the US President taking credit for a ceasefire with Pakistan as a diplomatic setback for India. Analysts also noted that India often failed to proactively solve its problems in 2025, instead enduring them.
Financial and geopolitical instability, combined with internal weaknesses, is expected to challenge India further in 2026. Experts warn that unresolved domestic and regional issues may increase India’s vulnerability in global and South Asian affairs.
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The Financial Times concluded that India’s limited economic and diplomatic capacity, coupled with regional tensions, paints a tough outlook. Analysts emphasize the need for stronger reforms, economic resilience, and strategic planning to avoid recurring crises.