PM Modi’s Pragmatic Reforms Help India Navigate Global Trade Pressures, Says International Report

Prime Minister Narendra Modi’s approach to global economic pressures and domestic reform has drawn international attention, with a recent report highlighting India’s ability to adapt pragmatically in an increasingly hostile trade environment.

In its latest newsletter introducing a series of articles, The Economist noted that European leaders grappling with pressure from Washington’s trade tariffs could learn from India’s nimble footwork.

The report observed that Prime Minister Modi has tackled adversities, coercion and constraints with a blend of pragmatism, resolve and resilience.

Under PM Modi’s leadership, relations with China have eased, leading to the lifting of certain investment restrictions.

At the same time, India has pursued trade agreements, with a major deal with the European Union expected soon.

While United States tariffs remain in place and continue to affect some exporters, the government has focused on demonstrating economic resilience rather than yielding to external pressure.

This stance, the report suggested, has reduced former US President Donald Trump’s leverage over India.

Reforms Driven by External Pressure

The report also underlined how global challenges have accelerated domestic reform. The government has simplified tax structures, deregulated parts of the nuclear sector and opened the electricity market to private and foreign investment.

Crucially, it has overhauled labour laws to help manufacturers expand and compete globally, reforms that met unexpectedly limited resistance at home.

However, the path has not been without setbacks. The report recalled that much of Modi’s second term lost momentum following widespread protests against agricultural reforms. Even so, it argued that India has shown an ability to find opportunity amid global disruption.

One article described India as a rising giant, attributing its economic ascent to a mix of reform, favourable circumstances and external geopolitical shifts. Despite facing steep US tariffs, amounting to as much as 50 per cent on some exports, India recorded GDP growth of 8.2 per cent up to the third quarter.

The government has since raised its growth forecast for the 2026 fiscal year to 7.4 per cent.

Although challenges such as sluggish private investment, foreign capital outflows and a weaker rupee persist, the report concluded that India’s combination of macroeconomic stability and structural reform offers strong grounds for optimism.

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