economy
The Guardian view on India’s Iran shock: Asia’s neoliberal era starts to fracture
Narendra Modi’s austerity appeals reveal how war, energy insecurity and dollar pressures expose the fragility of globalisation
TL;DR
- Indian Prime Minister Narendra Modi has urged citizens to reduce consumption of fuel, fertilizer, and gold, and curb foreign travel.
- This call for austerity marks a potential shift away from neoliberal globalization in Asia towards strategic economic management.
- India's decision is driven by surging global energy prices, the need to conserve foreign exchange, and a higher import bill in dollars.
- The crisis exposes the fragility of Asia's post-1990 growth model, which relied on a stable geopolitical environment and secure shipping lanes.
- The UN warned that South Asia faces significant economic losses from the war on Iran, emphasizing resilience through domestic productive capacity and economic security over efficiency.