I recently joined David Oualaalou on Geopolitical Trends for a wide-ranging discussion on BRICS, India’s foreign policy, China, the yuan, UPI, India’s economy, Manipur, Kashmir, and the changing balance of power in Asia.

I remain deeply skeptical of BRICS as a coherent geopolitical or economic bloc. China and Russia have identifiable strategic objectives, particularly in reducing their dependence on the U.S. dollar, but many of the other members operate through short-term expediency. I argue that India is especially problematic in this regard: it tries to position itself simultaneously among competing camps without developing a consistent strategic framework of its own.

We also discuss the reality behind India’s economic claims and digital infrastructure, why apparently cheap labor can become extraordinarily expensive once productivity, corruption, supervision, and institutional weakness are taken into account, and why I remain cautious about investing or operating businesses in India.

The discussion then turns to India’s relationships with China, Pakistan and Bangladesh, the continuing conflict in Manipur, my experiences with public safety in China, and the complicated historical and geopolitical realities surrounding Kashmir.

Watch the full discussion below.

Key Takeaways

• I remain skeptical that BRICS can become a coherent geopolitical or financial bloc. Its members often have conflicting interests, while China and Russia have the clearest strategic objectives.
• Whatever eventually emerges as a BRICS alternative to the Western financial system, I believe the Chinese yuan is likely to provide its real monetary backbone rather than some genuinely independent BRICS currency.
• India does not, in my view, have a consistent strategic position. Its foreign policy is largely transactional, moving between the United States, Russia, China and other powers according to immediate expediency.
• India’s UPI payment system has changed domestic transactions, but I see little that makes it uniquely attractive to the rest of the world when compared with China’s already highly developed digital-payment infrastructure.
• Cheap wages do not necessarily make India an inexpensive place to operate. Low productivity, supervision, delays, corruption, legal costs and unreliable execution can make the final cost far greater than the headline wage suggests.
• I see little on the ground consistent with the extraordinarily high economic-growth figures commonly reported for India. Manufacturing weakness, institutional dysfunction and poor productivity remain serious constraints.
• India is strategically weak in its own neighborhood. Its continuing disputes with China and Pakistan, and deteriorating relationships with other neighbors, consume resources that could otherwise be used for domestic development.
• The Manipur crisis is better understood as a long-running tribal and institutional problem than simply as a Hindu-Christian religious conflict. I argue that India’s governing institutions have repeatedly failed to resolve such conflicts.
• My experience of China is strikingly different: I have found even remote Chinese cities exceptionally safe, orderly and functional, including late at night.
• Kashmir is historically and legally far more complicated than the claim that the entire territory simply belongs to India. I argue that India should seek negotiated settlements with Pakistan and China rather than perpetuating conflicts it is unlikely to resolve militarily.