India navigates US-China tech rivalry and Middle East conflicts

Key facts

• India's foreign policy is being reshaped by US-China tech rivalry and Middle East conflicts.
• India is adopting a strategy of 'principled multi-alignment'.
• The 'China Plus One' strategy is driving investment into India as companies diversify manufacturing.
• India and the US have formalized cooperation in critical technologies through the iCET initiative.
• India's Production Linked Incentive (PLI) scheme supports sectors like electronics and pharmaceuticals.

India is navigating a challenging geopolitical environment defined by the escalating economic and technological competition between the United States and China, alongside the ongoing conflicts in the Middle East. In response, India has adopted a foreign policy of 'principled multi-alignment,' actively engaging with various global powers while safeguarding its autonomy. This strategy is exemplified by the 'China Plus One' initiative, which encourages multinational corporations to diversify manufacturing away from China and invest in India. Concrete examples include Apple's decision to produce iPhones in India, Micron's semiconductor plant in Gujarat, and GE's jet engine co-production agreement. Furthermore, the India-US initiative on Critical and Emerging Technology (iCET) formalizes bilateral cooperation in key sectors like semiconductors and AI. India's Production Linked Incentive (PLI) scheme actively supports these shifts by offering financial incentives across strategic industries.