Global order is disrupted by trade weaponization: Rajnath

Topic: GS2 – International Relations

Context

• Defence Minister Rajnath Singh highlighted emerging global threats at the Defence Services Staff College convocation in Wellington.

Trade Weaponization

What is Trade Weaponization?

• Trade weaponization refers to the strategic use of trade, finance, and technology as tools to exert geopolitical pressure or achieve political goals.

• Countries may impose sanctions, restrict exports/imports, control critical technologies, or block financial access to coerce or punish other nations.

• It includes using supply chain dominance, currency influence, or data flow control to create dependencies or vulnerabilities.

Impacts on the Global Order:

• Leads to a decline in trust in multilateral systems like WTO and global financial institutions.

• Encourages unilateralism and self-help, weakening rules-based international order.

• Results in disrupted supply chains, trade wars, and economic fragmentation.

• Increases strategic rivalry between global powers (e.g., U.S.-China tech war).

• Promotes economic nationalism and de-globalisation.

• Smaller economies face vulnerability and exclusion from global value chains.

• Affects global cooperation on climate, health, and security issues.

Way Forward:

• Promote transparent and rules-based global trade systems.

• Diversify supply chains and technological sources to reduce dependency.

• Enhance South-South cooperation and regional economic integration.

• Build resilience in critical sectors like food, energy, and health.

• Strengthen multilateral forums and reform global institutions for equity.

• Encourage technological self-reliance and innovation.

Practice Question: What do you understand by the weaponization of trade and finance? Discuss its impact on global institutional order and India’s strategic autonomy. (250 Words /15 marks)