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By:

Rajiv Shah

22 September 2025 at 8:32:23 pm

New Alliances, New Pressures, New Fault Lines

To its west, old relationships in the Gulf are acquiring new strategic and military dimensions. Across the Atlantic, Washington is increasingly using tariffs as an instrument of foreign policy. At the same time, India holds the BRICS presidency in 2026 and prepares to host its summit when the grouping is being watched in the West as a potential challenge to the American-dominated global financial order. Individually, these developments may appear unrelated. Put together, they reveal a larger...

New Alliances, New Pressures, New Fault Lines

To its west, old relationships in the Gulf are acquiring new strategic and military dimensions. Across the Atlantic, Washington is increasingly using tariffs as an instrument of foreign policy. At the same time, India holds the BRICS presidency in 2026 and prepares to host its summit when the grouping is being watched in the West as a potential challenge to the American-dominated global financial order. Individually, these developments may appear unrelated. Put together, they reveal a larger geopolitical churn in which alliances, energy, trade, currencies and economic coercion are becoming interconnected. India finds itself almost at its centre. The emerging Saudi Arabia–Türkiye–Pakistan security equation deserves particular attention. Saudi Arabia brings enormous financial and energy influence; Türkiye possesses considerable military strength, NATO experience and an expanding defence industry; Pakistan brings a large military establishment and nuclear capability with the open support of Washington. Any arrangement containing a collective-defence commitment naturally acquires significance beyond ordinary diplomatic cooperation. Alongside it, another strategic convergence has gradually developed among India, Israel and the UAE. It would be incorrect to describe this as a formal military alliance. Yet geopolitics does not operate through defence treaties alone. India's extensive defence and technology relationship with Israel, its rapidly expanding economic and strategic partnership with the UAE, and the UAE-Israel relationship following the Abraham Accords have created considerable common ground. I2U2—bringing together India, Israel, the UAE and the United States—added another institutional dimension. Thus, without necessarily becoming opposing military camps, two interesting strategic formations are visible across West Asia: Saudi Arabia–Türkiye–Pakistan and the looser India–UAE–Israel convergence. Balancing Challenge India faces a similar balancing challenge. The Gulf is not a distant geopolitical theatre for New Delhi. Nearly nine million Indians live and work there. India's energy security, investments, trade and remittance flows are closely connected with the region. The proposed India-Middle East-Europe Economic Corridor also requires relative stability across this geography. Polarisation in West Asia can therefore rapidly become an Indian economic and strategic problem. There is another question Indian planners cannot ignore. If a future India-Pakistan confrontation escalates, how would any collective-defence commitment involving Pakistan be interpreted by Saudi Arabia and Türkiye? It would be alarmist to assume that either country would automatically enter a conflict against India. Saudi Arabia, in particular, has substantial economic and strategic interests in maintaining good relations with New Delhi. Nevertheless, defence planners are paid to examine possibilities before they become crises. While these equations develop in India's neighbourhood, economic pressure is emerging from Washington. The US Senate has voted 86–11 for legislation intended to increase pressure on Russia by targeting major purchasers of Russian energy. The measure could authorise tariffs reaching 100 per cent against goods from countries continuing large-scale purchases of Russian oil and gas, with India among those potentially exposed. China is powerful enough to shrug off similar challenges from the West." However this does not mean that America has already imposed a 100 per cent tariff on India. Further legislative steps remain necessary, and presidential waiver provisions are important. But the overwhelming Senate vote carries a political message that New Delhi cannot dismiss. Tariffs are no longer merely tools of trade protection; they have become instruments of geopolitical coercion. Washington's argument is understandable: revenues from Russian petroleum help sustain Moscow's economy during the Ukraine war, and reducing those revenues increases pressure on Russia. But in that case what about European countries who too were/are customers of Russian oil? India's question is equally legitimate: who should determine where India purchases the energy required by more than 1.4 billion people? If Russian crude remains commercially advantageous and helps contain domestic energy costs, New Delhi cannot reasonably be expected to make every energy decision according to another country's geopolitical priorities. Strategic partnership cannot become strategic obedience. This is where BRICS enters the larger picture. India holds the BRICS presidency in 2026 and will host its leaders at an unusually sensitive moment. BRICS is no longer merely the original grouping of Brazil, Russia, India, China and South Africa. Its expansion has considerably increased its demographic, energy and geopolitical weight. More importantly, discussions around BRICS increasingly touch a sensitive nerve in Washington: alternative payment mechanisms, local-currency trade, development finance and the possibility of gradually reducing dependence upon the dollar-dominated international financial system. The BRICS Summit this time is poised to take some decisive steps which may affect western interests especially US. (The writer is an advocate, legal, geopolitical and public policy analyst. Views personal.)

Revenue Spirits

It seems when states run out of money, they often turn to the bottle. Maharashtra, India’s second-most populous state, is doing just that by preparing to lift a 50-year freeze on new liquor shop licences. In the works are 328 new licences, set to end an era dating back to 1974 when alcohol was a politically touchy subject and the socialist movement still wielded real clout. Money is the state’s simple rationale behind Maharashtra lifting its half-century liquor licence freeze.


With ambitious welfare schemes like the ‘Mukhyamantri Majhi Ladki Bahin’ programme straining the exchequer, fresh sources of revenue are urgently needed. The Excise Department already generates Rs. 43,000 crore a year, making it Maharashtra’s fourth-largest revenue stream. Officials estimate the new liquor policy could add another Rs. 14,000 crore annually.


On the surface, the move appears long overdue. Maharashtra’s population has soared over the decades, but the number of licensed liquor outlets has remained stubbornly stuck at a little over 1,700. That works out to just 1.5 liquor shops per one lakh residents - far below the national average of six.


A comparative laggard in retail density, the state is also out of step with peers that have steadily liberalised their alcohol markets over the years. But liquor policy is never just about arithmetic. It is about optics and inevitably, patronage. The new rollout is being steered by a committee headed by Deputy Chief Minister Ajit Pawar.


Critics argue this dual role represents more than just a bureaucratic convenience. Pawar’s links to the liquor industry, particularly a large manufacturing facility in the family bastion of Baramati, have raised red flags about conflicts of interest. Opposition leaders have branded the move as a form of state-sponsored cronyism.


The new leasing model has also raised eyebrows. Unlike the previous regime, where liquor licences were purchased outright at exorbitant costs on the grey market, the government will now offer new licences on lease with a non-refundable deposit of Rs. 1 crore and a projected Rs. 35 crores in annual fees. Officials claim this will democratise access to the liquor business and break old monopolies. But unless the leasing process is transparent, it could end up consolidating control among those already well-connected.


In earlier decades attempts to expand Maharashtra’s liquor network were routinely derailed by socialist stalwarts who argued that easy access to alcohol would exacerbate public health problems. Today, the moral argument has been drowned out by fiscal exigency.


Yet the ethical questions remain potent. Who benefits from this expansion? Will the proceeds be earmarked for social upliftment or vanish into a general revenue sinkhole? And can a state regulate a sector effectively when its top officials are so closely tied to its expansion? The economic logic behind the policy is hard to fault. But its execution and more crucially, the actors behind it will determine whether this is a legitimate revenue reform or a slippery slope of favour trading in the name of public finance.

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