The Middle Power Moment

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• Authors: N K SINGH
• Published: June 2, 2026

Geopolitics and the global economic order

• The global economy is shaped as much by geopolitical rivalry as by markets: trade flows are rerouted by political calculus; capital flows are driven by trust rather than efficiency; technology "has become a weapon of war."
• Geopolitics affects:
  • Supply chains and energy security as anchors of national resilience.
  • Financial systems and preferred currencies becoming more segmented.
  • Multilateral institutions facing strategic controversy (example cited: "The US withdrawal from the United Nations Framework Convention on Climate Change and other global platforms").
• Emerging plurilateral reality: coalitions are smaller, issue-specific, often transient; influence derives from the ability to convene, bridge divides, and shape agendas rather than from economic size or military might.

Role and responsibility of middle powers (including India)

• Middle powers can shape the global order by catalyzing plurilateral coalitions and convening pragmatic cooperation.
• Existing multilateral development institutions with limited or indirect US influence cited as alternative pathways: Asian Development Bank; European Bank for Reconstruction and Development; New Development Bank; Asian Infrastructure Investment Bank.
• Policy implication: middle powers must be "at the table, not on the menu"—actively shaping agendas especially where universal frameworks are eroding.

India’s position and strategic reorientation

• India has become the world’s fourth largest economy, averaging 7 percent growth over the past decade.
• India’s commitments and capacities:
  • Committed to net zero emissions by 2070.
  • Committed to 500 gigawatts of non-fossil energy capacity by 2030.
  • Renewable energy already exceeds 50 percent of installed capacity.
• India’s attributes for leadership:
  • Large, diverse democracy with diplomatic traditions emphasizing dialogue and consensus.
  • Economic scale and recent leadership roles (e.g., presidency of the Group of 20) provide leverage to build bridges across fragmented blocs.

Four common challenges facing middle powers

• Challenge 1 — Geopolitics in economic domains & climate transition:
  • India is the world’s third largest oil consumer and thus exposed to external shocks.
  • Developing economies require at least $310 billion annually for adaptation; current flows are only $26 billion.
  • Fiscal context: average fiscal deficit of emerging market economies is about 5.5 percent of GDP.
  • Macro policy need: reconcile transition costs via prudent fiscal policies.

• Challenge 2 — Excess capacity and trade dynamics:
  • In 2023, China produced 1,019 million metric tons of crude steel.
  • Excess global steel is projected to be 644 million metric tons.
  • Solar photovoltaic manufacturing will soon be twice as high as global demand.
  • Policy stance: calibrated protection of domestic industry from unfair competition while remaining integrated in global markets to shield against protectionism.

• Challenge 3 — Demographic divergence and migration:
  • Median age: less than 20 in Africa; below 30 in India.
  • Demographic contrast with shrinking populations in parts of East Asia and Europe.
  • Policy need: review traditional attitudes toward orderly migration; frame flows as an essential orderly response to global labor imbalances rather than a crisis.
  • Human capital caveat: younger demographics are a strength only if matched by skills and employment opportunities.

• Challenge 4 — Technology, digital inequality, and skills gap:
  • Only 1 percent of 14- to 18-year-olds in India have received formal skills training.
  • Businesses will need 1.25 million professionals in artificial intelligence by 2027.
  • Global investment context: $877 billion in global foreign direct investment is cited as the prize for attracting technology-linked capital.
  • Policy imperative: massive sustained investment in human capital and R&D to steer AI toward productivity and inclusive progress, and to avoid its use for surveillance and conflict.

Path forward — strategies and policy recommendations

• Reform multilateralism by strengthening alternative pathways and pragmatic cooperation where universal consensus is lacking.
• Middle powers should:
  • Catalyze new coalitions among emerging market and developing economies.
  • Emphasize dialogue, consensus, and bridge-building across fragmented blocs.
  • Pursue calibrated industrial protection combined with global integration to manage excess capacity and prevent protectionist backlashes.
  • Invest significantly in skills, education, and R&D to capture a larger share of the $877 billion in global foreign direct investment and to meet AI workforce needs (1.25 million professionals by 2027).
  • Reconcile fiscal imbalances (average emerging market fiscal deficit about 5.5 percent of GDP) while mobilizing adaptation finance (need: at least $310 billion annually; current flows: $26 billion).

Strategic outlook and concluding observations

• Fragmentation will persist but need not mean disorder; smaller, issue-specific coalitions can enable action.
• India’s choices will shape both its trajectory and the role of middle powers in the emerging global order.
• Opportunity: redefine the relevance of the Global South through inclusivity and by ensuring "all nations a seat at the table."

The Middle Power Moment — N. K. Singh, June 2026.

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