Narendra Modi is the prime minister. Subrahmanyam Jaishankar is the foreign minister. Piyush Goyal is the commerce minister. Nirmala Sitharaman is the finance minister.
The BJP lost its parliamentary majority in the 2024 election and now rules with coalition partners. In June 2025 the government announced it would hold a long-delayed census in 2027. After the census India can by law overhaul the boundaries of its electoral districts for the first time in half a century; the poor, populous north, where the BJP is popular, may gain seats at the expense of the prosperous south. In 2026 the BJP introduced a package of reforms to expand the lower house from 543 to 850 seats, redistribute seats to reflect demographic changes, and reserve a third of them for women; opposition leaders, particularly from the south, called the package a power grab and the bills failed. MPs in northern Uttar Pradesh on average represent a fifth more voters than those in southern Tamil Nadu. About 40% of Indians live in urban areas, generating nearly 60% of GDP, yet metropolitan MPs on average represent a tenth more voters than rural ones; Bangalore's four seats hold as many voters as six average rural ones.
India's foreign-policy doctrine has shifted from "non-alignment", a term associated with Jawaharlal Nehru, to "multi-alignment", which allows for close ties with America and signifies India's willingness to work with anyone who backs its ambitions. Indian strategists describe their approach as "cynical realism": balancing America, China and Russia transactionally. For a decade or more India placed great weight on the notion that America and China are locked in an enduring contest, pitching itself as an indispensable hedge against China in Asia. India's economy is one-fifth the size of China's.
In 2001 America lifted sanctions it had imposed on India because of its nuclear-weapons programme; in 2005 it began negotiating a nuclear-co-operation deal, signed in 2008. Nine years before the current crisis, America made India a "major defence partner", a designation that gives it access to advanced defence technologies without having to become a full ally. India and America are members of the Quad, a security group also comprising Australia and Japan. The two sides are due to sign an overarching defence "framework" governing military ties over the next decade, and are putting the finishing touches to a deal, announced in 2023, for America to help India produce jet engines for fighter planes.
On August 31st 2025 Modi attended a meeting of the Shanghai Co-operation Organisation (SCO) in Tianjin, China—his first visit to China in seven years. The trip followed a thaw in relations between India and China since October 2024, when the two came to an understanding over their border dispute. Talks have since moved to economic matters. In the year to March 2025 India imported about $114bn-worth of goods from China, roughly 75% more than five years earlier; only about $14bn went the other way. India has not officially relaxed curbs on Chinese investment imposed in 2020 but the collapse of trade talks with America has put a slightly freer stance on China back on the cards.
India has also been cementing ties with Russia. Since America levied new tariffs in August 2025, Modi twice spoke to Vladimir Putin on the phone. Subrahmanyam Jaishankar, India's foreign minister, met Sergei Lavrov, his Russian counterpart, in Moscow on August 21st; the pair said their countries were aiming to increase bilateral trade. On December 4th 2025 Putin visited Delhi for the 23rd India-Russia summit—his first visit since launching the war in Ukraine in 2022. Well over half of Indians had a favourable view of Russia in 2023, compared with a 24-country median of 15%, according to Pew Research Centre.
For decades after independence India boasted a statistical infrastructure far superior to what its level of development would suggest, but the system suffered from both neglect and political interference. Controversies in 2018 and 2019—over GDP calculations, unemployment rates, payroll data and consumption—sapped confidence in India's numbers; two officials at the National Statistical Commission resigned in protest. A Niti Aayog report warned that "policy rides on numbers no one fully trusts".
In 2024 the government installed Saurabh Garg, a veteran civil servant with a doctorate from Johns Hopkins University, as head of the statistics ministry. He has created a calendar of data releases, cleared the backlog of surveys, speeded up data-gathering and publication, and organised dozens of workshops. He is now focused on producing output numbers for India's 800-odd districts and preparing the statistical infrastructure for AI by harmonising definitions and setting metadata standards. Mr Garg is already past the official retirement age of 60 and serving on an extension.
India's elite civil service—the "steel frame" of governance—comprises just 5,577 officers. It has grown by fewer than 1,100 in the past 15 years, a period in which the population surged by 250m and the economy doubled in size. Britain, whose population is a twentieth of India's, has over 7,500 senior civil servants.
The Election Commission of India (ECI) is the constitutional body that organises the country's polls. On indices compiled by the V-Dem Institute, a Swedish think-tank, India's electoral process has long outperformed its peers in the region, but its score has been sliding over the past decade, dragged down by declines on measures tracking voter irregularities and freedom for parties to operate. Milan Vaishnav, a political scientist, writes that there are signs that elections in India "are free but not necessarily always fair".
The head of the ECI is nominated by a panel that includes the prime minister, leader of the opposition and another minister—skewed towards the executive. The Supreme Court had recommended that the third member should be the Chief Justice of India, but that was ignored by the government. Critics argue that the model code of conduct, which the ECI uses to monitor election campaigns, is unfairly applied, with clear violations by BJP leaders, including the prime minister, ignored.
In August 2025 the ECI began a "Special Intensive Revision" of the electoral rolls in Bihar ahead of polls due by November. Such revisions are rare—the last one in Bihar was in 2003—and are usually planned in great detail. This one was announced abruptly and will be completed for a state with 130m people in a matter of weeks. Some 6.5m voters were struck from the list (approximately 8.3% of the total). The ECI says the deletions were due to deaths, duplicate entries and migration. Rahul Gandhi accused the ECI of colluding with the BJP in a "vote theft" scheme and embarked on a "Voter Adhikar Yatra" (Voter Rights March) in Bihar. The ECI's boss, Gyanesh Kumar, ordered Gandhi to file an affidavit to the courts or apologise.
India has more than 2,500 matchmaking startups, perhaps the most in the world. Well-known Western dating apps entered India about a decade ago but have struggled to make money; over the past 18 months some big foreign apps have begun pulling out. Homegrown apps tend to serve a market they call "date to marry", reflecting a culture where many young Indians are caught between arranged marriages and Western-style dating. Flutrr, one such app, targets aspirational youth in second- and third-tier cities and comes in seven languages; an AI tool composes love poems on behalf of tongue-tied suitors.
India gained independence from Britain in 1947. In 1965 a war with Pakistan following a devastating drought left it dependent on food aid; America made it devalue the rupee. In 1991 a spike in oil prices from the Gulf War and collapse of remittances from workers in Kuwait prompted a balance-of-payments crisis, leaving just enough foreign exchange to cover two weeks of imports. The government pledged nearly 50 tonnes of gold to help tide itself over—a national humiliation—and then devalued the currency by 9%, followed two days later by another 11%. Manmohan Singh, the finance minister, used the crisis to begin dismantling the "licence raj" system of export controls and float the currency. The trauma of 1991 scarred the national psyche; a sharply falling rupee is, for many Indians, inseparable from the shame of that period.
Indians are unusually attentive to the value of their currency; a strong rupee has long been seen as a matter of international prestige. Narendra Modi, then a state leader, exploited this fixation during the 2013 "taper tantrum" (when the rupee fell 20%), delivering fiery speeches blaming the ruling Congress party for the collapse and turning the currency into a political weapon. Opposition politicians now relish giving him a taste of his own medicine. Morgan Stanley counted India among "the fragile five" emerging markets in 2013 (alongside Brazil, Indonesia, South Africa and Turkey).
Since then India's macroeconomic position has strengthened markedly. Foreign-exchange reserves stand at around $700bn, or 18% of GDP—sufficient for 11 months of imports. Ten-year government bonds yield less than 7%. Non-performing loans fell from 15% in 2018 to 3%. The government trimmed its budget deficit from 9.2% of GDP in fiscal 2021 (bloated by pandemic spending) towards a target of 4.4% for fiscal 2026; excluding interest payments, the deficit is only around 0.9% of GDP. It plans to cut its debt-to-GDP ratio from around 56% to 50% by 2031. Revenue from services exports (mostly business-process and IT outsourcing) now amounts to 15% of GDP, up from 11% a decade ago. A mandate to mix ethanol into petrol was introduced in 2021. Cheap imported Russian crude saved around $8bn in foreign exchange last year.
More than half of government jobs are reserved for "backward" castes or other disadvantaged groups. The graduate unemployment rate was 29% last year. Bangladesh, Nepal, Sri Lanka and Pakistan have all been forced into IMF programmes in recent years; India has avoided that fate.
India spends about 3% of GDP on energy from abroad, getting roughly half from the Middle East. Its foreign-exchange reserves cover about seven months' imports; official and commercial oil stocks would last about 70 days. Its refineries are set up to process lower-quality crude, allowing it to take in Russian oil that many others cannot. Unlike much of Asia, India generates little electricity from imported gas, favouring local coal, which limits the channels through which higher energy prices feed through to the economy. As of early 2026 India had roughly 5-6 days of natural-gas inventory. Major Indian fossil-fuel firms include GAIL and Indian Oil. Around 9.5m Indians live and work in the United Arab Emirates and other Arab Gulf states, sending large sums home in remittances; a blockade of the Strait of Hormuz would imperil both that trade and those workers.
India is in the midst of a vast port-building effort expected to continue until 2047, though its ambitious plans are at risk because the country is bracketed by major ports in Singapore and Salalah (in Oman), and its own ports risk cannibalising each other. Hapag-Lloyd, a German shipping giant, raised its stake in JM Baxi Ports, an Indian firm.
India has invested in the Iranian port of Chabahar to gain access to Central Asia. It has been close to Russia to offset China, and friendly with Iran to counterbalance Pakistan, drawing American sanctions (some now lifted). India's ships are among the few that Iran has been allowing out of the Gulf during the 2026 war. America has looked to India to counterbalance China, for instance by helping to track Chinese ships and submarines exiting the Strait of Malacca, but India recoiled from America's and Israel's war on Iran and the associated energy shock.
India consumes around 31m tonnes of liquid petroleum gas (LPG) each year, most of it used for cooking. Around 60% is imported, making India the world's second-largest LPG importer after China. Before the 2026 Iran war, some 90% of those imports came from Qatar and other Middle Eastern countries via the Strait of Hormuz. In just over a decade the number of Indian households using LPG more than doubled, thanks to welfare schemes encouraging people to switch from firewood. But as demand soared India did little to boost domestic production or diversify supply. State-owned oil companies distribute LPG through 26,000 dealers. Only around 5% of Indian homes have piped gas; most rely on cylinders.
In March 2026 the closure of the Strait of Hormuz caused a fearsome gas crunch. Restaurants closed for lack of cooking fuel; fertiliser plants and crematoriums paused operations. Black-market prices for a standard 14kg cylinder reached around 4,000 rupees ($43), four times the government's fixed price. India negotiated the safe passage of two LPG tankers through the strait; together they carried some 93,000 tonnes, enough for roughly one day's supply. Subrahmanyam Jaishankar suggested the agreements with Iran could be a template for other countries, though further movements would be negotiated ship-by-ship. Twenty-two more Indian oil and gas tankers were waiting to make the journey.
In the IMF's April 2026 update, Britain overtook India to regain the title of the world's fifth-largest economy, pushing India to sixth place—largely the fault of the rupee's depreciation. India, which is growing five times as fast as Britain, is expected to reclaim fifth place before long. India was the world's tenth-largest economy in 2014; it has GDP of just under $4trn and a $5trn stockmarket. The gap with Japan, the fourth-largest, is about $300bn at market exchange rates. The IMF projects India will be the world's third-biggest economy by 2028. Its goods exports are worth roughly 11-15% of GDP, compared with 60% for Thailand and 85% for Vietnam, making it relatively insulated from trade shocks. Services now export almost as much as all other sectors put together; tech-services firms make at least half their sales to American customers. The economy grows at almost 6% a year in real terms, the fastest of any big country. In the year to the third quarter of 2025, GDP grew by 8.2%, much faster than expected; the government raised its forecast for the 2026 fiscal year from a range of 6.3-6.8% to 7.4%. GDP is forecast to surpass Japan's in 2025. The current-account deficit is a low 1.1% of GDP. Consumption accounts for 61% of GDP.
On February 27th 2026 the Ministry of Statistics and Programme Implementation released a methodological overhaul of GDP figures, the first since 2015. The base year was reset to 2022 and new data sources added. GDP turned out to be 3.3% smaller than previously thought, making the country look more rural than before. Agriculture, responsible for 18% of GDP, appears bigger, largely thanks to more detail on fisheries and dairy. The service sector, at 41% of the economy, looks 8% smaller than under the old methodology; manufacturing makes up 15% and has also shrunk slightly. On the bright side, GDP expanded by 7.1% in fiscal year 2024-25, up from an earlier estimate of 6.5%, confirming India's title as the world's fastest-growing big economy. That the new figures show a less rosy picture of Modi's record should reassure observers about the independence of Indian statistics; earlier doubts had lingered since the shelving of a 2019 survey that showed a drop in rural consumption.
In August 2025 S&P, a credit-rating agency, gave India its first sovereign-credit rating upgrade in almost 20 years, raising it to the same grade as Greece. Inflation fell to 1.3% by late 2025, helped by two consecutive years of good monsoon rains; food prices, which make up 46% of the consumer-price index, fell by 2.7%. Agricultural wages hit an eight-year high of 4.5% real growth year-on-year in May 2025. Sanjay Malhotra, governor of the Reserve Bank of India since December 2024, has cut interest rates by 1.25 percentage points over the past year. He has been readier than his predecessor to let the rupee depreciate, and has told the Financial Times that rates are likely to stay low for a "long period". Earlier reforms, including the creation of a digital-payments infrastructure and the RBI's shift to an inflation-targeting regime in 2016, have helped reduce inflation expectations and are now paying off.
Modi promises to make India a developed economy by 2047, the centenary of its independence from Britain, which would require GDP to reach $10trn. In 2022 Piyush Goyal, the commerce minister, aimed for $30trn; NITI Aayog, the government's in-house think tank, echoed that target. Modi's subsequent retreat to $10trn is modest: at today's exchange rates, and accounting for the real appreciation of the rupee as India gets richer, it should be comfortably achievable. But a $10trn economy divided among the UN's projected 1.7bn Indians in 2047 would yield a GDP per person of only $6,000—about the same as modern Iraq—placing India in the World Bank's upper-middle-income category rather than the high-income group ($14,000 per person). Reaching that threshold would require GDP per person to quintuple in 22 years, at a growth rate of 7.5% a year—above the average of 5.7% seen so far under Modi. Arvind Subramanian, a former government adviser, doubts the official growth figures, arguing they understate how much growth is actually a rise in prices and overstate improvement in the informal economy.
For decades India's byzantine labour laws have throttled enterprise. Over 95% of industrial firms employ fewer than ten workers, and many others exactly 99, because most rules apply only to firms with ten or more staff—creating compliance and other overheads that Amrit Amirapu of the University of Kent and Michael Gechter of the University of Arkansas found cause a 35% increase in labour costs. The result is a "missing middle": giant companies able to cope with the regulations, tiddlers that would rather not, and little in between. India's Industrial Disputes Act, passed in 1947, has also made it near-impossible for manufacturers with over 100 employees to fire workers, putting off investment, preventing factories from reaching the economies of scale found in east Asia, and skewing the private sector towards capital-intensive businesses. Some 42% of the manufacturing workforce is contract labour, hired for specific, limited tasks; garment factories are two-thirds of the size, on average, of rivals in Bangladesh.
India's gig workforce was 7.7m in 2020-21 and is projected to reach 23.5m by 2029-30, according to NITI Aayog. An NBER working paper comparing gig workers in India, Indonesia and Kenya found that most Indian delivery drivers do not come from full-time formal work, and more than half end up in formal jobs afterwards—suggesting gig work acts as a stepping stone. The new labour laws granted digital gig workers legal protections and social security. Gig drivers are more likely to hold tertiary degrees than the average Indian; the country faces a paradox of the highest GDP growth of any big economy alongside 30% graduate unemployment. India's labour minister asked delivery apps to drop reckless ten-minute delivery promises.
On November 21st 2025 Modi announced the biggest overhaul of labour laws since independence in 1947. Hiring and firing will be liberalised, compliance simplified and flexibility increased. The proposals include social security for gig workers, a right to a contract for every worker, and the removal of restrictions barring women from working at night or in industry. States must implement the changes; most are expected to do so in the next financial year, and some, including Maharashtra and Uttar Pradesh, are preparing further deregulation. Arvind Panagariya of Columbia University called it "the mother of all reforms". The State Bank of India reckons the reforms will boost consumption and increase the share of formal jobs by 15 percentage points. Unions labelled the plans a "deceptive fraud" and began industrial action on November 26th, though labour organisers have less sway with younger workers than they once did.
India has a persistent private-sector investment malaise. When Modi took office in 2014 gross fixed capital formation was 25.3% of GDP; in 2024 it was 25.1%. Business investment has barely surpassed 12.6% of GDP (itself well below historical highs) and in 2024 was a mere 11.5%. Existing factories have operated at only 70-75% capacity over the past decade. A national goods-and-services tax (GST) introduced in 2017 unified India's markets and erased most local taxes. On August 15th 2025 Modi announced a long-overdue reform of the GST, to be implemented by Diwali (late October 2025). The tax's unwieldy four main rates will be simplified to two—5% for essentials and 18% for everything else—plus a 40% sin rate for a handful of items. A corporate-tax cut in 2019 slashed the effective rate from 35% to 25%, but operating profits surged while capex barely budged. Starting in the 2025-26 financial year, anyone earning up to 1.2m rupees ($13,700) pays no income tax, up from 700,000 rupees; the threshold covers more than 85% of those who file returns. Salaried workers make up just a fifth of the labour force. The share of workers in manufacturing, at 12%, is the same as it was two decades ago; half the jobs created since the pandemic have been in agriculture.
Since 2016 the five biggest conglomerates have gained more of the market. Corporate concentration is reinforced by protectionism: government policies have been described as "pro-business rather than pro-market". The average import duty, at 16%, is over a fifth higher than when Modi came to power.
Volkswagen was recently charged by the Indian tax authorities with misclassifying imports; it faces a penalty of $2.8bn. Samsung has been asked to pay $520m for similar alleged offences. Both cases have sent a chilling signal to foreign investors. In February 2025 Modi said his government would set up a deregulation commission to reduce burdens on businesses. On August 19th 2025 it announced the remit of a new committee tasked with making it easier to do business and removing the threat of criminal penalties for even minor mistakes; a bill will decriminalise more than 300 provisions, including arcane laws criminalising selling biscuits labelled with the wrong weight.
Labour-force participation has been climbing, reaching 55% in the most recent quarter. Yet some analysts worry this is misleading, because it counts unpaid jobs. Almost a fifth of under-30s in cities are unemployed. Private corporate investment was just 12% of GDP in 2024. Foreign direct investment inflows rose to $81bn last year, but net FDI has fallen owing to higher repatriation and firms exiting the country.
Indian stocks trade at a premium of around 20% over the rest of the world. Roughly three-fifths of Indians still depend on the rural economy; the monsoon brings three-quarters of the country's annual rainfall, and monsoon quality has an outsized effect on demand and food prices. In 2025 the government sent about 38m farmers forecasts generated by AI weather models rather than traditional numerical ones; see AI weather forecasting.
In January 2026 India's Supreme Court alarmed foreign investors with a ruling that threw into confusion what tax they must pay on capital gains.
India has signed trade deals with Britain, Oman and New Zealand. On January 27th 2026 India and the European Union announced a free-trade pact, alongside a security and defence partnership, a deal on skilled migration (mostly from young India to ageing Europe) and an agreement to expand India's participation in Horizon, the EU's flagship research-funding programme. Ursula von der Leyen, president of the European Commission, and Antonio Costa, president of the European Council, were guests of honour at Republic Day on January 26th; a small contingent of soldiers flying the EU's banner joined the military parade. India is the EU's ninth-biggest trading partner; exports to India are about €76bn ($91bn), or 0.4% of the EU's GDP. The current average tariff on Europe's exports to India is about 9%; under the deal tariffs on European cars will gradually fall from 110% to 10%, subject to a quota. India's €105bn in exports of goods and services to the EU roughly matches the $129bn it exported to America in 2024. The deal is shallower than others the EU has recently signed, reflecting India's protectionism; controversial segments, including many agricultural goods, were excluded. India considers the EU's carbon border adjustment mechanism, which taxes imports whose production emits a lot of greenhouse gases, to be protectionism masquerading as environmentalism. The EU's latest package of sanctions on Russia included three Indian entities. India also negotiated a free-trade agreement with America in the same week as the EU deal. Details remain unclear, but tariffs on Indian exports to America are expected to be around 18%. The two agreements together could make India a near-open economy, with protection largely restricted to agriculture. India's share of low-skilled exports to low- and middle-income countries is just 2-3%, compared with China's 53%; the deals revive the "China Plus One" strategy for India. Under the EU deal, India will have fully liberalised its manufacturing sector within seven to ten years—substantially more ambitious than India's previous "Swiss cheese" trade agreements, which were ridden with exemptions and carve-outs.
Canada and India have also said they are working towards an agreement. This is serious progress for a trade-deal-shy country. An interim trade deal with America has proved elusive: America wants India to accept more farm produce, including genetically modified maize and soyabeans, which is difficult given that nearly half of all Indian workers toil in agriculture. Powerful tycoons resist agreements that would increase foreign competition. Hindu nationalist groups oppose big concessions to foreigners. India reportedly seeks assurances that the Trump administration will not introduce further tariffs after any deal is signed.
Big American companies are increasingly setting up "global capability centres" in India, staffed with Indians skilled in coding and finance. That industry made $65bn in 2024, with projections of around $100bn by 2030. These are no longer just call-centre jobs but increasingly core business functions, including quantitative modelling, AI research and pharmaceutical labs. Western firms are moving more jobs to India to secure the talent they used to get at home through visa programmes. Australian universities Deakin and the University of Wollongong have opened Indian campuses; several British institutions, including the universities of Bristol and York, are planning campuses in Mumbai.
Over the past decade India's electronics industry has grown five-fold, driven by firms looking to reduce their dependence on China. Apple now assembles nearly one in five of its iPhones in India and hopes to make all the handsets it sells in America in Indian plants by 2026. Foxconn, Apple's biggest supplier, recently pledged another $1.5bn to expand local operations. At Samsung's sprawling plant in Noida, near Delhi, workers now make touchscreens and circuit boards themselves rather than assembling kits built elsewhere. The value-added in India's smartphone manufacturing has risen from around $4.5bn in 2021 to $17.3bn in 2025 (estimated using data from the India Cellular and Electronics Association). Electronics are exempt from American tariffs. Yet phones are still assembled locally while their guts—chips, batteries and camera modules—are mostly made in China.
India faces a trade deficit with China of $99bn in 2024-25. The pharmaceutical sector, one of India's biggest exporters to America, relies on China for 70% of precursor chemicals. The smartphone industry assembles phones largely from imported components, including many from China. China recently ordered hundreds of Chinese engineers in Indian electronics plants to return home, and Indian executives report sophisticated Chinese-made machines being blocked from going to India.
Relations with China, which froze after the Galwan Valley border clash in 2020, have thawed. After Galwan, India suspended visas, investment permissions and direct flights. By late 2025 the countries had reached a détente, at least on trade, partly in response to Trump's trade war. In December 2025 exports to China were nearly 70% higher than a year earlier. Recognising that India's ambition to become a global manufacturing hub depends on Chinese expertise and machinery, the government re-liberalised the visa regime, making it easier for Chinese workers to help build Indian factories. It is reported to be mulling allowing Chinese companies to invest in India again.
A vigorous reform effort is under way aimed at problems that have bedevilled the economy for decades. A cap of 74% on foreign direct investment in the insurance industry has been lifted. Nuclear power has been opened to the private sector. Financial-market regulation has been overhauled. States have pursued their own reforms, including allowing women to work after dark so that textile and electronics factories can stay open later. An energetic committee led by Rajiv Gauba, formerly a long-serving cabinet secretary, publishes lists of potential reforms for both states and the central government every month. Quality control orders (QCOs)—certifications required for every import, nominally to protect consumers—had ballooned to 765 by early 2024. Since mid-2025 the government has been cutting them back, mostly on intermediate goods such as purified terephthalic acid (an ingredient in polyester) and viscose staple fibre (used in textiles). Nirmala Sitharaman, the finance minister, intends to simplify tariffs further: "Customs is my next big cleaning-up assignment," she said in December 2025.
Under Modi the government has poured money into roads and railways. India's cities have been linked up with 50,000km of new main roads, expanding the network by 60% in a decade. Almost all Indians now use Aadhaar, an online-identity system; digital-payment transactions almost hit $3trn last year. India's payments network handles around 700m transactions a day. The "India Stack"—the country's digital platform for biometric identification and payments—has become a model for other developing countries.
India's cities contribute at least 60% of GDP but account for just 15% of public employees and a negligible 3% of government spending; by contrast, America's cities command over a quarter and China's more than half. A 1992 constitutional amendment allowed the devolution of power from states to cities, but did not make it mandatory; most states ignored it. Cities are run by bureaucrats appointed by the state; mayors are figureheads. Elections for corporators are frequently delayed: Bangalore has not had elected officials for five years; Mumbai last held local elections in 2017.
Bangalore (formally Bengaluru) ranks third-worst globally in a traffic index compiled by TomTom, a navigation service. Its population is estimated to have expanded to 14m, up from 8.4m at the 2011 census. Earlier in 2025 the state of Karnataka abolished Bangalore's municipal corporation and replaced it with five smaller corporations overseen by a new Greater Bengaluru Authority (GBA). The GBA's chairman is the chief minister of Karnataka and its vice-chair is the minister for Bangalore—bringing political power and political responsibility for the city into the same place for the first time. The transition will be complete once local elections are held in early 2026. Critics argue the GBA violates parts of the 1992 amendment, opening the door to lawsuits. If it succeeds, it could serve as a blueprint for other Indian metropolises.
States are emerging as reform laboratories. Tamil Nadu grew at 11% in 2024, attracting Apple by adopting a pragmatic approach to land acquisition and labour relations. Karnataka now spends one-sixth of its budget on direct handouts. Telangana and Maharashtra have adopted far-reaching electricity reforms that will end farmers' entitlement to free power by placating them with solar panels.
India's fantasy-gaming industry included more than 2,000 startups with collective annual revenues of about $3.8bn. Dream11, the largest platform, had 200m users. On August 21st 2025 India's parliament passed a bill banning all money-based online games; the president signed it into law the following day. Operators face fines and up to three years in prison; banks that process transactions for them would also be punished. The industry body claims gaming firms contributed more than 200bn rupees annually in taxes (around 0.8% of all tax receipts). Several firms are considering a Supreme Court challenge.
India is a milk superpower. For nearly three decades it has been the world's biggest producer and is the source of about a quarter of the global total. The industry has particular importance for Hindu-nationalist politicians (the cow is sacred in Hinduism) and is a source of national pride, seen as a poverty-alleviating triumph of enlightened policymaking, technological advance and international co-operation.
India's "white revolution" was launched in 1970. At the time Indians already had more cattle than any other country but consumed an average of about 100 millilitres of milk a day, far below recommended nutritional standards. By the turn of the century India had virtually doubled per-person milk availability. A network of tens of thousands of co-operatives was established, financed by the sale of skimmed milk powder and butter donated by the European Economic Community. India has about 200m cattle, of which an estimated 62m are dairy cows, yet the average "herd" consists of fewer than four and the average landholding has just one hectare. Around 80m families have one or more cows or buffaloes. America, by contrast, has just 24,000 dairy farms with an average herd size of about 390. The average American cow produces about seven times as much milk as her Indian counterpart.
Import tariffs on dairy are comparable to those Mr Trump has imposed on Indian exporters: 40% on most butter and cheese and 60% on powdered milk. Amul, a co-operative from Gujarat—home state of Modi and Amit Shah—is one of the biggest dairy organisations. "White Revolution 2.0", launched in 2024, aims to expand the co-operative system, with procurement increasing by 50% over five years.
Dairy access is a sticking-point not just with America but also in negotiations with the EU, and was one of the thorniest issues in the trade deal with Britain signed in 2025. It may also have been the main reason India pulled out of a big regional trade deal in 2019.
Around half of India's voters depend economically on agriculture, making farm reform politically perilous. Though yields have risen steadily for 60 years, they remain poor: Indian rice-growers harvest about a third less than their Chinese peers, and pulses are grown more efficiently in crisis-ridden Myanmar. Low agricultural productivity slows urbanisation, because rural poverty means people lack the resources to move into cities.
Much of the blame lies with distorted incentives produced by a web of subsidies—cheap power, cheap fertiliser and government-backed price guarantees for certain crops. Politicians make things worse by imposing controls whenever consumer prices rise: a ban on exporting wheat has been in place since 2022. Modi has twice attempted farm reform and twice retreated. At the start of his first term he was forced to withdraw a land-acquisition law after his government was branded a "suit-boot ki sarkar". During his second term, a year-long protest by farmers from the north and west forced him to repeal three deregulatory laws in 2021. The kernel of the 2020 proposal was the idea of giving farmers freedom to sell their produce as they pleased; that failed largely because big landowners and powerful middlemen convinced farmers it was a path to exploitation.
Yet in practice the system is changing by the back door: politicians have been nudging farmers to sell outside the mandis (state-run markets), including by encouraging contracting. In Haryana the state government has given farmers incentives to diversify into more valuable crops. On the back of two good monsoons, agricultural wages in 2025 rose by 4.5%, the biggest jump in eight years. The government has also announced plans to reform a giant rural employment scheme.
The Ministry of Railways employs 1.2m people and runs 70,000km of track. One of the first main lines was built by the British in 1862, running between the coal mines of Bengal and the then capital, Calcutta. After independence in 1947 the railways were nationalised. Employees receive pensions, lodgings or reduced rent, medical allowances and free travel. (Mahendra Singh Dhoni, the former India cricket captain, started his career as a ticket inspector playing for a regional railways team.)
In the 1980s the ministry standardised its recruitment and gradually introduced nationwide exams. The entrance tests—multiple-choice questions on current affairs, logic, maths and science—bear little direct relation to the jobs in question and function as an arbitrary filtering mechanism for overwhelming application volumes. During the most recent recruitment drive there were around 90,000 positions on offer and roughly 30m applicants. For some jobs, such as junior ticket collectors, applicants face odds of more than 1,800 to one. Since 2015 the ministry has eliminated more than 70,000 low-level and administrative positions.
About 500,000 students currently prepare for government exams in Musallahpur Haat, a suburb of Patna in eastern India, where dozens of coaching centres are concentrated. Many are taking railway-entrance papers. Students often spend years in Musallahpur waiting for exams to be called, which do not follow a fixed schedule. Cheating is a persistent problem: leaked papers can sell for tens of thousands of dollars, and when irregularities are identified the exams may be cancelled, forcing candidates to wait indefinitely for a re-sit. In 2022 students rioted across Bihar, occupying railway tracks and setting fire to a train, after authorities announced that candidates who had sat one exam would have to take another.
India's branded hotel rooms rose to 200,000 in 2024, up from 100,000 in 2014—about the same as the UAE, which has less than a hundredth of India's population. Another 100,000 rooms are expected by the end of the decade. IHCL (Indian Hotel Company Limited), India's biggest chain, has opened around 50 hotels since the start of 2024 and plans to double from more than 350 to nearly 700 by 2030. Accor and InterGlobe want to grow from 111 to 300 hotels in the same period.
Ten years ago 69% of branded rooms were in ten cities; that dropped to 58% in 2025 and is expected to hit 50% by 2029. India's GDP per person is approaching the $2,000-$3,000 threshold at which discretionary spending on travel tends to boom. "Spiritual tourism"—visiting temples such as the one at Ayodhya—is a growing driver. Government infrastructure investment, including thousands of miles of new highways and flight connections up more than 25% since before the pandemic, is opening up second-tier cities.
India is experiencing an IPO boom. Some 298 deals were completed in 2025 through October, more than in the whole of 2023, according to Dealogic. Jio, a telecoms behemoth backed by Mukesh Ambani, is expected to list in 2026. Households now direct about 5% of their savings into shares and mutual funds, up from 2.5% in 2020; retail participation in IPOs has surged thanks to deregulation and digital payments. Private investment has been stagnant at about 10% of GDP. Power companies, especially in renewables, have been among the biggest to list: Waaree Energies listed in October 2024; NTPC Green Energy listed at a valuation of $12bn. Swiggy, a delivery app, listed in late 2024 at $12.7bn; Ather Energy, an electric-scooter maker, listed in March 2025. About 63% of shares sold in 2025 IPOs were "offers for sale" by existing owners rather than fresh capital raised. LG Electronics and Hyundai, both South Korean, listed their Indian arms. Foreign institutional investors sold around $18bn of Indian equities in 2025.
India's retail-trading boom has created the world's most active derivatives market. During the covid-19 pandemic online-trading platforms took off and retail investors, many with little experience, soared in number. By mid-2023 stock derivatives had trading volumes 422 times larger than those of the underlying cash market; America's ratio was nine to one. In early 2024, by one estimate, 84% of all global derivatives trading was occurring in India. In July 2025 the Securities and Exchange Board of India (SEBI) banned Jane Street, an American trading firm, from the country's securities markets, accusing it of manipulation in the options market.
The rupee lost around a tenth of its value against the dollar in the fiscal year to March 2026. Sanjay Malhotra, the governor of the Reserve Bank of India, has previously suggested that modest depreciation is "normal" for the rupee—an arithmetic consequence of India's inflation being higher than America's. In the 12 months to March, however, inflation in both countries was virtually identical at a smidge above 3%, meaning the rupee's decline represented a collapsing real effective exchange rate. Nearly two-thirds of that decline predated the 2026 Gulf energy crisis.
Some $31bn have flowed out of Indian debt and equities since the start of 2025, compared with total inflows of nearly $50bn in the preceding two years. Millions of zealous domestic retail traders have pushed up valuations: before the Iran-induced slump, Mumbai's Nifty 50 index of large firms traded at some 26 times earnings, compared with 17 for MSCI's benchmark basket of emerging-market stocks. India lacks artificial-intelligence firms that excite investors, and AI could put some of its giant listed IT consultants such as TCS and Infosys out of business. Net foreign direct investment turned negative in late 2024 and early 2025, then again in the first three months of 2026, as foreign multinationals, venture capitalists and buy-out firms took advantage of high valuations to cash out.
The 2026 Iran war made matters worse. As a big energy importer spending around 3% of GDP on oil, natural gas and petroleum products, India would see its current-account deficit increase by around $80bn (2.1% of GDP) if oil stays at $100 a barrel for a year, according to Neelkanth Mishra of Axis Bank. During the war the RBI's foreign-exchange reserves dwindled by $25bn to around $700bn (partly reflecting a drop in the price of gold, which makes up about a fifth of the kitty). The RBI also limited banks' daily bets against the rupee to $100m—the first such restriction in 15 years—before reversing the measure on April 20th, perhaps concluding that making it harder to hedge currency risk is not the best way to keep investors in India.
India spends $71bn a year on research and development, less than a tenth of America's or China's outlay. R&D intensity is just 0.7% of GDP, compared with 3.6% in America and 2.4% in China. In the World Intellectual Property Organisation's innovation index, India ranks 39th; China is 11th; America is third.
The private sector contributes just over a third of R&D spending, against around two-thirds in the most innovative countries. Among the world's top 2,000 corporate R&D spenders in 2023, only 15 were Indian, investing about $5.9bn in total. The five most profitable non-financial firms in India spend just 0.3% of their sales on R&D, compared with 8.8% in America and 2.1% in China. Infosys, a big tech company, devotes only 0.6% of its $19bn turnover to R&D. Tata Motors accounts for over half of India's corporate R&D spending, but most of that comes from its British subsidiary, Jaguar Land Rover.
Indian academics are prolific: by number of publications they rank third in the world. But on quality, measured by the h-index (tracking how often work is cited), India slips to 19th. No Indian university ranks among the world's top 100 for scientific research, according to the Nature Index. India is the second-most popular destination (after Britain) for American firms to set up R&D hubs, but sees little domestic spillover into deep innovation.
In 2023 the government launched the Anusandhan National Research Foundation (ANRF), modelled on America's National Science Foundation, with plans to spend $6bn over the coming years, roughly 70% from non-government sources.
Between 2017 and April 2025, Indian "deep-tech" startups—those in AI, computer vision and robotics—raised just $8bn, barely 5% of total startup funding in India in that period. Chinese deep-tech firms raised $6.4bn in 2024 alone.
Jawaharlal Nehru established the precursor to the Indian Space Research Organisation (ISRO) in 1962, at the urging of Vikram Sarabhai, a leading physicist. Unlike the cold-war agencies of America and the Soviet Union, India's was devoted to development goals such as monitoring monsoons. It has since become a rare example of a widely respected Indian government institution. In 2020 the government opened the space sector to private firms. Before that, companies could act only as suppliers to ISRO. A new agency, IN-SPACe, was created as a "single window" where companies could obtain licences for space activity and access ISRO's launch capacity. The government estimates private space-industry revenues now exceed $8bn, with around 400 startups, many set up by alumni of the Indian Institute of Space Science and Technology (IIST).
India boasts a handful of space clusters. One is in Bangalore, long a centre of the aerospace and defence industry: aeronautics labs were established there shortly after independence, close to what had been a British military base. Another is in Chennai, near ISRO's launch site. AgniKul Cosmos, also based in Chennai, plans to become a "taxi" for satellites using 3D-printed smaller reusable rockets; its first commercial launch is scheduled for later in 2026. Digantara, whose satellite-mounted lasers can track missiles as well as orbital debris, supplies American defence contractors and has attracted interest from India's defence establishment. The brief conflict with Pakistan in 2025 showed the need for capabilities in space; China reportedly provided Pakistan with satellite images during the clash.
ISRO's Gaganyaan mission aims to achieve crewed space flight in 2027, which would make India only the fourth country—after America, Russia and China—to do so. The government hopes the space sector will contribute to India's rise as a powerhouse of advanced manufacturing.
India is OpenAI's second-biggest market by users, accounting by some estimates for about 14% of ChatGPT's user base. Anthropic also counts India as its second-largest market by usage. According to BCG, a consultancy, 92% of Indian office workers regularly use AI tools, compared with 64% in America; a large majority of Indians believe AI's benefits outweigh its risks. In 2024 India attracted just $1.2bn in private AI investment, placing it 12th globally, behind Austria and Sweden. In America the figure was $109bn; in China $9bn. India's datacentres account for just 3% of global capacity. The country has more open-source developers than China, second only to America, but no Indian model features among the top 200 large language models ranked by LMArena, a benchmarking website.
Silicon Valley firms have pursued "blitzscaling" tactics in India: OpenAI sells chatbot access at a fifth of the price of its cheapest American plan; xAI's Grok is priced at a quarter of its American rate; and Perplexity has made its service free for a year to all 360m users of Airtel, a big Indian mobile operator. Tata Consultancy Services, India's biggest IT-services firm, said in September 2025 it would cut 12,000 staff to become "future ready"; Jefferies, an investment bank, predicts that more IT firms will follow.
India's rules do not restrict companies from transferring data across borders, and there is nothing on the books to prevent data collected in India being used to train AI models overseas. Google's Android powers over 90% of the country's smartphones. Indian users show a preference for speaking to AI models rather than typing queries, perhaps because many internet users cannot read or write.
The government announced a $1.2bn programme to support local AI, some of which has gone to buying more than 34,000 chips (Meta owns ten times as many). The IndiaAI Mission makes AI processors available at roughly a third of the global cost. Four companies, including Sarvam AI, a Bangalore-based startup, have been selected to develop a fully homegrown AI model. Sarvam AI has adapted open-source models by training them on local voice and language data; recent benchmarks show it outperforms general-purpose models for certain niche tasks, such as reading documents in Indian languages. A study in 2022 by MacroPolo, an American think-tank, found that only one-fifth of India's top AI researchers remain in the country. A venture-capital partner estimates the country has fewer than 300 skilled AI researchers, far fewer than Britain or France.
India was the first developing country to host the annual AI summit, following Britain, South Korea and France. At the February 2026 summit in Delhi, Narendra Modi stood on stage with Sam Altman and Dario Amodei, the bosses of OpenAI and Anthropic. India has 900m internet users who spend on average seven hours a day online. Anthropic opened an office in Bangalore on February 16th 2026. India's political and tech leaders promote a distinctive "adoption capital" approach—not trying to build frontier models but focusing on use cases and applications. Supernova, which aims to make English tuition affordable to all Indians, has a million monthly users and is growing at a clip. Telemedicine and AI-triage chatbots are expanding in a country where health care remains limited.
In late 2021 the central government announced $10bn of incentives for semiconductor investors, alarmed by post-covid chip shortages and keen to cut reliance on cheap chips from China. Five big projects have been approved. Most are facilities for assembly, testing and packaging—an end-stage that is less technical but more labour-intensive than other parts of chip production. Tata Group, in partnership with Powerchip of Taiwan, is building India's first commercial chip fabrication plant in Dholera, Gujarat, in an $11bn project. The government provides 50% of project costs; state authorities contribute another 20-25%. About 125,000 Indians work in semiconductor design, most for big international chip companies in cities such as Bangalore, accounting for about one-fifth of the world's chip designers—but very few work for home-grown firms.
In 2020 India introduced a policy giving officials full discretion to block Chinese investment proposals. It has since selectively approved joint ventures that give the Indian partner a controlling stake. Chinese firms signing such deals include Vivo, a smartphone producer; Suzhou Inovance, an electric-vehicle component maker; and ZNShine, a solar-panel maker.
In April 2025 the commerce minister said India would not approve an application for BYD, a Chinese EV-maker, to invest $1bn in an Indian joint venture. Ant Group, a Chinese fintech giant, sold its stake in an Indian company in 2025.
In March 2026 the government announced two changes to the Chinese investment regime: companies with less than 10% Chinese beneficial ownership would be able to bypass onerous checks; and decisions on projects in several critical sectors, such as capital goods, electronic components and inputs to solar-power projects, would have to be made within 60 days. The rules were drafted vaguely, and Chinese analysts were sceptical they would make much difference. India's trade deficit with China now exceeds $100bn annually, up from roughly the same levels five years earlier. Modi visited China in August 2025, his first trip since border clashes in 2020 and 2021 that killed dozens. Direct flights between the two countries resumed in October 2025.
Agriculture and dairy have been the most contentious issues in India's trade talks with America. Modi has declared that "India will never compromise on the well being of its farmers, dairy and fishermen." India excludes imports of all genetically modified crops except cotton, and in dairy there is a ban on "non-veg milk"—a requirement that imported dairy products be certified to come from cows not fed animal products such as bone meal. The ban was introduced in 2003 in response to the BSE (mad-cow disease) scare in Europe, though it is often decried as a non-tariff barrier dressed up in Hindu-nationalist clothes. Twice in four years India's farmers have fended off attempts at reform: in 2021 prolonged protests in Delhi forced Modi to repeal three deregulatory laws.
America's "reciprocal" tariffs initially included a 26% levy on India, paused at a 10% rate until July 8th 2025. In August 2025 Trump imposed 25% tariffs on India, then added a further 25% days later—pushing the total rate to 50%—citing India's "massive" oil purchases from Russia. Indian manufacturers of textiles and garments now face a huge disadvantage compared with regional competitors such as Bangladesh, Indonesia and Vietnam, which face tariff rates less than half of India's. Existing exemptions for pharmaceuticals and electronics survived.
By October 2025 negotiations on a detailed trade agreement with America were at an advanced stage. India put on the table historic concessions on agriculture, described as a legally enforceable "thousand-line trade deal". It was exploring creative ways around long-held red lines, for example by relaxing bans on imports of dairy products and genetically modified food. It might allow American milk from cows fed non-vegetarian diets if cartons are labelled accordingly. A decrease in tariffs on American industrial goods could also be included. India was also preparing to spend big on American aircraft, weapons and oil—including a potential $4bn deal for Boeing P-8 maritime surveillance aircraft, useful for tracking Chinese submarines in the Indian Ocean—but was holding such purchases in reserve to sweeten a trade agreement.
On February 2nd 2026 Trump announced a trade truce. America's reciprocal tariff on Indian goods would fall from 25% to 18%, and the additional 25% levy imposed in August over India's purchases of Russian crude would be lifted. In return, India would halt purchases of Russian oil, Trump said. Modi confirmed the tariff reduction but was mum on Trump's claim that India had pledged to buy $500bn-worth of American energy and agricultural products—a figure that dwarfs total Indian imports from America, which amounted to $83bn in 2024. Two days after the deal, Piyush Goyal, India's commerce minister, said agriculture and dairy had been "completely protected"; Jamieson Greer, America's trade representative, confirmed India would retain protections in some "key areas". The Kremlin said it had heard nothing from India about cutting Russian oil purchases after the deal was announced.
HSBC estimated that the previous, higher tariffs would have shaved 0.7 percentage points off annual Indian growth; it now reckons the effect will be half that. The 18% tariff is lower than the levies America imposes on rival labour-intensive manufacturing hubs such as Vietnam, Bangladesh and China. The rupee rallied and equity indices jumped after the deal's announcement. Indian officials hope the truce will also improve sentiment: investment spending, by both foreign and domestic companies, has been muted despite India remaining the world's fastest-growing major economy. The deal came less than a week after India and the EU unveiled their own trade agreement. The new American ambassador in New Delhi, Sergio Gor, is credited with taking the edge off relations since his arrival in January 2026.
Russia supplied a negligible 0.2% of India's oil imports before the war in Ukraine. Since then it has become India's biggest supplier; the share of oil coming from Russia jumped from 2% before 2022 to 36% in 2024, saving India $13bn on its energy bill in the first two years of the war, according to ICRA, a ratings agency. Total bilateral trade with America is $212bn. American sanctions on Russian oil firms that kicked in in late 2025 and forthcoming European ones are disrupting the arrangement, though Indian officials are already speculating about when to reopen the taps.
Russia's share of India's oil imports peaked at around 44% before falling to 25% by February 2026, as Trump used Indian purchases of Russian crude as a rationale for additional tariffs and EU sanctions dissuaded refiners hoping to keep selling into Europe. The closure of the Strait of Hormuz during the Gulf war halved the roughly 2.5m barrels a day India had been receiving from the Middle East, chiefly Iraq, Saudi Arabia and the UAE. India's refiners—including Reliance Industries, Nayara Energy (part-owned by Rosneft), Indian Oil Corporation, Bharat Petroleum and Hindustan Petroleum—turned again to Russia, but now at a premium of $10-15 over Brent, the global benchmark, with competition from China, Japan and South Korea. India managed to replace less than two-thirds of the lost Middle Eastern supply. The Indian government froze local fuel prices in 2022 and has kept them fixed even as oil has grown dearer to source.
On May 6th 2025 India and Britain agreed a trade deal described as the most ambitious agreement in India's history. India reduced tariffs on 90% of products—the most open agreement on goods it has struck. Tariffs on whisky and gin were halved from 150% to 75%; tariffs on cars fell from 100% to 10%, subject to a quota. Britain reduced tariffs on Indian clothes, shoes and food. The deal is expected to boost annual trade between the two countries by £25.5bn over 15 years. India accounts for around 2% of Britain's trade in goods. Indian workers on inter-company transfers in Britain will not have to pay national insurance for three years; around 110,000 workers are employed by Indian companies in Britain. Since Modi won re-election in 2024, India's appetite for trade agreements has grown. India had previously struck serious trade deals with relatively few countries.
Under Jawaharlal Nehru, India's first prime minister, the government pursued state-led development through import permits and the promotion of domestic industry—a system that came to be known as the Licence Raj. Firms wanting to buy foreign equipment or parts needed a permit; consumer imports were effectively banned. In 1974 Anne Krueger, then of the University of Minnesota, coined the term "rent-seeking" to describe how companies competed to secure licences for monopolies or oligopolies; she calculated India's rents were worth 7% of GDP in 1964, when the government was spending 1.5% of GDP on education. Coca-Cola pulled out of India in 1977 after the government told it to hand over its recipe. In 1978 Raj Krishna, of the Delhi School of Economics, coined the term "Hindu rate of growth" for India's dismal annual advances of 3-4%.
The assassination of Rajiv Gandhi in 1991 and an IMF bail-out helped set off a chain of events that led to the system's demolition. Manmohan Singh, a reforming finance minister, scrapped import licensing and slashed tariffs. Since then growth has been closer to 6% a year. Jagdish Bhagwati of Columbia University helped inspire the dismantling. The legacy of the Licence Raj proved sticky: families that built wealth under it had a head start when public assets were privatised, and Singh's own government later culminated in scandals over telecommunication licences and coal concessions.
IndiGo holds a 66% share of the domestic market and is the only carrier on 60% of India's roughly 1,000 domestic routes. Air India, the flag carrier, has 27% of the market; it is the only other airline of any size. Making money out of aviation is especially difficult in India: high taxes on fuel swallow profits, the growing heft of airport operators—one firm controls half of privately operated airports—risks driving costs up further, and an imperfect bankruptcy law drives teetering airlines out of business even when they might be saved. In December 2025 IndiGo's failure to prepare for new pilot-rest regulations caused a meltdown that cancelled more than half its flights, effectively grounding Indian aviation as a whole.
India has one of the world's most comprehensive rail networks; the railway minister says roughly 80% of trains run on time. But stations are chaotic and grimy, the majority of trains are trundlers, and many services sell out far in advance. Roads are marred by unlicensed drivers, baffling signage, potholes and frequent obstructions such as stopped vehicles and stray animals; they rank among the world's most dangerous.
India has only 34 cars for every 1,000 people; their owners are unusually rich and privileged. Indian cities are run by unelected bureaucrats who serve for just a few years; real power resides at the state level, where politicians tend to be more focused on rural voters than urban ones. Bangalore has overhauled many kilometres of inner-city roads—burying pipes and wires, installing wide pavements and marking out parking spots and lanes—becoming a model other cities plan to replicate. Andhra Pradesh is running a pilot programme involving "clean-air zones" along the most clogged and polluted arteries.
India's total fertility rate has fallen below the replacement level of 2.1, standing at 1.9 nationally. In Delhi women can expect to have just 1.2 babies. In the poorer northern states of Uttar Pradesh and Bihar—together home to about 300m people—the rate is more than double Delhi's but falling. India is more or less bound to start shrinking around mid-century. See global population decline.
The sex ratio at birth was 107 boys per 100 girls in 2023, down from 109 in 2010—still above the natural baseline of about 105. Sex-selective abortions resulted in 111 boys per 100 girls in 2011, according to census data; The Economist calculates that around 20m more boys than girls were born in India in 2000-15. See son preference and singlehood.
Over the past four years Russia has supplied 36% of all the arms India has imported—much less than two decades ago, in part because India worries Russian support might be withdrawn if it finds itself at war with China. Russia accounts for over a third of India's defence imports, down from nearly three-quarters a decade or so ago. France and Israel together supply around 46% of India's arms. On August 22nd 2025 India announced that a French firm will help it produce engines for homegrown fighter jets. America and India had been tightening defence co-operation, but the relationship is now uncertain after disputes over tariffs and Kashmir. India has 62 French-made Rafale fighters and is considering buying more.
Russia's S-400 air-defence system was described as a "game-changer" in India's war with Pakistan in May 2025 by the air-force chief. India ordered five S-400 systems in 2018 but is still waiting for two of them. India is keen to acquire more, and Russia has offered an updated Su-57 stealth-fighter jet with a full transfer of technology; India had turned down an earlier version, partly for not being stealthy enough. The two countries are also discussing co-production of the next-generation S-500 missile-defence system. Russian kit is developing a reputation for shoddy quality and supply disruptions, not helped by the war in Ukraine.
India's defence-and-aerospace startup scene is flourishing, boosted by the government's push for indigenisation and the experience of the May 2025 war with Pakistan. In 2018 the defence ministry launched Innovations for Defence Excellence (IDEX), a scheme connecting startups with military units that want specific problems solved. By 2024 IDEX had attracted more than 600 companies; its largest individual grants jumped from $178,000 in 2021 to almost $3m. For some projects the government promises a minimum order, giving startups guaranteed revenue if prototypes work.
Just days after the ceasefire following Operation Sindoor, India launched "emergency procurement" worth almost $5bn—around 25% of its annual capital spending on defence. A substantial chunk went to replenishing ammunition, missiles and interceptors consumed during the operation. There is also renewed focus on drones and counter-drone defences; India's air defences were "stressed by drone saturation" and the challenge of distinguishing real weapons from decoys, forcing India to use expensive interceptors against cheap projectiles.
The border clash with China in 2020 had already deepened the relationship between Delhi's defence establishment and the mostly Bangalore-based startup scene; firms increasingly take products to front-line commands to test them in real-world conditions. Notable startups include Digantara (satellite-movement intelligence, valued at more than $65m, 150 employees in India, Singapore and America), GalaxEye (radar and satellite imagery), IdeaForge (a big drone-maker) and Fabheads (3D-printed carbon-fibre parts). America has more than a dozen defence-related "unicorns"; Europe at least three. India is chasing its first.
In 1963, after being thumped by China in a war in which the Indian Air Force stood by helplessly, India acquired the Soviet MiG-21, which propelled the country into the supersonic age and cemented its reliance on Soviet hardware. Around 900 aircraft passed through the IAF, most of them made in India under Soviet licence. The early version was celebrated for shooting down Pakistani planes in the 1971 war over Bangladesh. Over 400 Indian MiG-21s crashed over 60 years, killing 200 pilots and 60 civilians—earning the grim moniker "the flying coffin" from the Indian press. On September 26th 2025, after 62 years of service, the MiG-21 was retired. In 2019 a MiG-21 Bison was shot down during tit-for-tat air strikes with Pakistan; its pilot, Wing Commander Abhinandan Varthaman, acquired cult status after being captured and returned. When India launched air strikes on Pakistan in May 2025, the MiG-21s were used again.
The IAF had assumed it would start replacing its MiGs in the 1990s. The Tejas, an Indian-designed and -built jet, was meant to take over but was slow to arrive and disliked by many in the IAF. Instead, India's government ploughed cash into upgrading its French Mirage-2000 and Russian MiG-29 fleets and into buying the Rafale, rather than replacing the huge MiG-21 fleet wholesale. India lost five jets to Pakistani missiles on the first night of the May 2025 conflict, according to Western intelligence assessments. China now has around three combat aircraft for every Indian one, a higher ratio than a decade ago.
Jammu & Kashmir is a Muslim-majority region claimed in full but ruled in part by both India and Pakistan. Tens of thousands of people have been killed there since an anti-India insurgency began in 1989. In 2019 India revoked Kashmir's semi-autonomous status, splitting what had been an Indian state into two federally administered territories: Jammu & Kashmir, and Ladakh. That allowed tens of thousands of outsiders to get jobs and buy land in the region.
On April 22nd 2025 at least 26 people were killed and 17 injured after gunmen opened fire on tourists in Pahalgam, the deadliest attack on tourists since the insurgency began in 1989. A group calling itself the Resistance Front claimed responsibility (only to deny it later, saying it had been hacked). Indian officials allege, without providing public proof, that the Resistance Front is a proxy for Lashkar-e-Taiba (LeT), a Pakistan-based militant group with alleged headquarters near Muridke, a town 30km north of Lahore. Indian Foreign Secretary Vikram Misri alleged cross-border involvement from Pakistan. India immediately suspended a 1960 river-sharing treaty and closed the two countries' only land border crossing.
India and Pakistan have fought two wars, plus a more limited conflict, over Kashmir since their independence in 1947. Both have nuclear weapons. In 2016 Modi sent troops to hit militant targets in the part of Kashmir ruled by Pakistan, 11 days after an attack on an Indian military base. In 2019, after a suicide-bombing that killed 40 Indian policemen, India conducted air strikes on alleged militant sites in Pakistan 12 days later; Pakistan shot down an Indian jet and captured the pilot (returning him after a few days under American pressure). India has about half a million security forces in the region.
On May 7th 2025, two weeks after the Pahalgam attack, India launched its largest aerial assault on Pakistan in more than 50 years (Operation Sindoor), striking nine sites using SCALP cruise missiles and Hammer smart-bombs from Rafale jets, fired from Indian airspace. For the first time India targeted sites in Punjab province, including alleged camps of Lashkar-e-Taiba and Jaish-e-Mohammed. Both sides exchanged artillery fire and drone attacks across the line of control over four days.
India has 62 Rafales and is considering buying more; it is expected to launch a long-overdue tender for 114 fighters. Foreign military officials believe five Indian aircraft were destroyed in the fighting, including at least one Rafale. General Anil Chauhan, India's chief of defence staff, acknowledged "tactical mistakes" on the first night. A debate erupted over whether the Rafales under-performed: Dassault is reluctant to share the jet's source code, and a French parliamentarian raised concerns that its SPECTRA electronic-warfare system failed to detect China's PL-15 air-to-air missiles used by Pakistan. Dassault dismissed Pakistan's claims of shooting down three Rafales as "simply untrue".
On May 10th Donald Trump announced a ceasefire, which India was frustrated by—officials say they were blindsided. Modi addressed the nation claiming the operation established a "new normal": terrorist attacks would henceforth be treated as acts of war. India objected when Trump offered to help negotiate a deal over Kashmir, given its longstanding opposition to third-party involvement. During the conflict, China provided Pakistan with real-time intelligence that allowed Pakistan to target Indian military assets down to individual missile launchers.
Under Article 370 of India's constitution, Jammu & Kashmir was granted notional autonomy except on foreign policy, defence and communications. In 2019 Modi scrapped Article 370, stripped J&K of its statehood and brought it under federal rule, deploying half a million security personnel to watch over the 14m locals. In 2020 residency cards became available for non-Kashmiris, as did the right to buy land—fitting a Hindu-nationalist desire to rebalance the demography of the Muslim-majority region. The Supreme Court blessed the revocation in 2023 but ordered the government to reinstate J&K's rights as a regular state, an order critics believe the government is using the volatile security situation to ignore. A record 3.5m tourists visited Kashmir in 2024.
Since the April 2025 Pahalgam attack, security forces have pursued what one member of the J&K legislative assembly called "collective punishment", including bulldozing homes belonging to families of suspected militants. Within two weeks police said they had questioned or detained 2,800 Kashmiris, including journalist Hilal Mir, detained for "anti-national" social-media posts.
Indian television news has long served as a platform for the ruling BJP, praising the government, disparaging minorities and opposition politicians. During the May 2025 fighting with Pakistan, broadcast news fabricated events wholesale—reporting Indian naval strikes on Karachi, an army border crossing and a Pakistani army coup, none of which occurred. Newspapers proved more reliable but were hampered by the nocturnal nature of the skirmishes.
Journalists who seek to expose abuses by the ruling BJP face a hailstorm of discouragement. Supporters of the party refer to critical reporters as "presstitutes". Abhinandan Sekhri, the boss of Newslaundry, a digital news group in Delhi, says he has received official notices that he or his firm is suspected of tax evasion about 80 times in the past four years. Pro-government media firms sue Newslaundry for "defamation" and "copyright infringement" when it criticises their bias. Tax officials raid its offices. Police question Mr Sekhri—once for six hours, another time for 13. Those most at risk are not high-profile journalists in Delhi but those "uncovering shady activities of some local god-man in a small village". Jagendra Singh, who wrote about alleged links between a politician in Uttar Pradesh and the "sand mafia"—who steal truckloads of sand from public land and sell it to cement firms—died of burn injuries after a visit from police; the police said it was suicide. Independent journalism survives in online outlets such as the Wire and the Caravan, and on social media and YouTube. See press freedom.
In November 2025 the Digital Personal Data Protection Act came into effect. In the name of protecting privacy, it significantly curtails a right-to-information law that has been a vital tool for investigative journalists; by weakening a public-interest justification, it makes it harder for reporters to unearth documents essential to corruption investigations. It also requires journalists to obtain consent from those they are tracking. In February 2026 the government granted itself the power to instruct websites and platforms to remove content in just three hours, without needing to seek a court order first—among the strictest such policies in the world. Platforms including Meta have questioned its feasibility.
B.V. Nagarathna, a supreme court judge, warned publicly in February 2026 that the government has no need of direct censorship, since it already has a range of tools—including tax, regulation, ownership laws and advertising budgets—to muzzle its critics. She observed that the media may be "legally free" but "economically constrained." For print publications with dwindling circulations, the state has become a major source of advertising revenue. The press is often "dependent on corporate power, which itself may rely on state patronage," she said.
Gautam Adani, a tycoon with close ties to Narendra Modi, has filed suits against at least 15 journalists who have dug into his business arrangements. In February 2026 Ravi Nair, an investigative journalist and persistent thorn in Adani's side, was sentenced to a year in prison by a court in Gujarat after being found guilty of criminal defamation for social-media posts making exaggerated claims about murky dealings. He is due to appeal. Countering these trends are a handful of digital-first sites—Scroll.in, Newslaundry and The News Minute—with subscribers willing to pay for scrutiny, but they remain small.
Freedom House, a think-tank, classifies India as "partly free", alongside countries such as El Salvador and Mozambique. India's constitution claims to guarantee freedom of speech, but makes exceptions for the sake of "public order, decency or morality". It also states that "no person shall be deprived of his life or personal liberty", which the Supreme Court has ruled includes a right to dignity. This allows anyone who feels a remark transgresses that right, or is indecent, to file a police complaint—or indeed multiple complaints with multiple police agencies—forcing the target to spend time and money defending themselves even if no conviction follows.
Stand-up comedy has become one of the most prominent arenas for this tension. Comedy was the most popular genre among Indians who stream TV shows and movies in a 2023 study by Nielsen, a market-research firm, yet performers face threats of violence, mob attacks on venues and politically motivated arrests. The comedian Munawar Faruqui was jailed for five weeks in 2021 for "hurting religious sentiments"; in October 2025 police in Delhi arrested members of a gang planning to murder him. Censorship has captured most other art forms—films, television shows and plays require funding, crews and often an official censor's approval—but comedy is decentralised, needing only a microphone and, in the age of social media, easily disseminated.
According to Vidhi, a legal think-tank in Delhi, India has 7,305 crimes at the national level, three-quarters of which attract imprisonment. Some 301 crimes carry the death penalty, though it is rarely applied. In 2023 India decriminalised 183 defunct provisions in 42 laws, and is working on a second rationalisation. The Bombay Prohibition Act of 1949 requires a permit to drink alcohol in Mumbai; a first offence is punishable by a fine and up to six months in prison.
India's 28 states control vast swathes of policy and are no less assiduous in regulating everyday life. The state of Uttarakhand requires couples in live-in relationships to register within 30 days of cohabiting; failure to comply attracts a fine and up to three months in prison. Tax rules make almost everyone cower: companies that grow beyond even a small size must register for a goods-and-services tax, and must register in each state in which they have any activity, even without a physical presence.
India's Insolvency and Bankruptcy Code was introduced in 2016, hailed as the end of the "defaulter's paradise". The World Bank had estimated that bankruptcies in the country dragged on for 4.3 years on average, more than twice as long as China. The new regime promised to cut that to 270 days. Of 8,000 firms admitted into the insolvency programme, over three-fifths were successfully dealt with. But three out of four cases exceed the 270-day deadline; of 1,900 ongoing cases, 78% are overdue, up from 68% in June 2024, according to CareEdge Ratings. Recoveries stand at 32%, only marginally better than the 25% under the old regime.
Judicial delay is a core problem: in theory, lenders can trigger insolvency proceedings for defaults over 10m rupees ($113,600), but in practice admission can take up to two years. Infrastructure is rickety—cramped courtrooms with broken air-conditioning and retired bureaucrats rather than industry experts sitting as judges. Even voluntary liquidations with clean paperwork take around 4.3 years, nearly three of them to chase government clearances. In May 2025 India's Supreme Court scrapped JSW Steel's $2.3bn takeover of Bhushan Power and Steel, citing procedural lapses, only to reverse its verdict in September following industry backlash.
In August 2025 the government proposed a raft of fixes: fast-tracking cases once a default is proven, a "clean-slate" rule to wipe out old claims upon approval, and a new out-of-court route for genuine failures.
Microfinance was popularised by Grameen Bank in Bangladesh and is far preferable to village moneylenders, who often demand usurious rates, security or pledges of labour. Microloans are collateral-free; most are to poor women. Some 60m Indians owe $35bn-worth of such loans, with repayment rates near 95%. Over 90% of repayments are in cash, so must be made in person; field officers note everything down to whether a house's roof is tin or concrete.
In 2018 India's Supreme Court restricted the use of Aadhaar, the national ID system, for loan verification and reporting. Without a centralised system, borrowers can use duplicate IDs to secure multiple loans. In 2022 the Reserve Bank of India created one regulatory framework for all lenders, including banks and microlenders, exposing microlenders to more competition. Real rural wages fell by 0.4% from 2019 to 2024. As incomes stagnated and food prices rose, borrowing increased and defaults climbed. The total value of outstanding microloans in India fell year-on-year by 17%, to $41bn in June 2025. Delinquency rates more than doubled, to 6%. In May 2025 IndusInd Bank disclosed a $76m accounting error in its microfinance portfolio. In August Manappuram Finance reported a 75% year-on-year drop in quarterly profit. In August 2025 the Microfinance Industry Network sought up to $2.2bn in government-backed credit guarantees to shore up liquidity.
India's judicial system is painfully slow. More than 50m cases are awaiting a verdict across the country. Nearly a third have been pending for more than five years; around half have been delayed by at least three years. Around 75% of India's prisoners are awaiting trial, the sixth-highest share in the world. The World Bank estimated in 2019 that enforcing a contract in India takes roughly 1,500 days, compared with less than 500 in the rich world and China. The World Justice Project ranked India 131st out of 142 countries on judicial speed, below Pakistan and Sudan.
Nearly a third of judge positions and a quarter of support staff roles in high courts are vacant. Even at full strength, vacancies alone would not clear the caseload: in 2024 the lower courts disposed of 23m cases while 25m were added. The India Justice Report, a non-profit, expects the backlog to increase by at least 15% by 2030.
Bhushan Gavai was appointed chief justice on May 14th 2025. He will have only six months in the role before mandatory retirement. His successor will serve around a year. The short tenures of chief justices have hampered reform.
The judiciary controls its own appointments, a process long considered opaque. In 2014 the ruling BJP tried to involve the government in appointments but the Supreme Court struck down the proposal as undermining judicial independence. Critics argue the judiciary is hardly insulated from political influence: several decisions have seemingly favoured the government, and post-retirement government jobs for judges create perverse incentives.
Southern Indian courts dominate national rankings of judicial performance, thanks to better governance, more efficient use of budgets, investment in court infrastructure and better staff-to-case ratios. The High Court of Kerala has pioneered machine-learning examination of filings and a case-management system that tightens schedules.
India has consistently fared worse on composite measures of justice than Indonesia, China and Vietnam, according to the World Justice Project. Indians, however, are more confident in their courts than Americans, Britons and Japanese, according to Gallup. A study by the Development Data Lab in Washington found no evidence that Indian judges exhibit bias towards groups from their own communities, based on an analysis of more than 5m criminal cases between 2010 and 2018.
2024 was the hottest year ever recorded in India, with some places exceeding 50°C. Ten of the country's 15 warmest years on record have occurred in the past decade and a half. Over 40% of people globally experiencing very strong or extreme heat stress live in South Asia. Around half of Indians work outdoors.
South Asia has warmed far more slowly than elsewhere over the past 40 years—around 0.09°C per decade, compared with 0.30°C over the rest of the world's land mass. Scientists attribute this "warming hole" to heavy aerosol pollution (which intercepts sunlight) and expanding irrigation (which cools through evaporation). India's irrigated land has doubled since 1980. As pollution is cleaned up and groundwater becomes depleted, warming is expected to accelerate sharply: atmospheric scientists say India is "pretty much assured" to warm at twice the rate of the past two decades over the next 20 years.
Aerosol pollution kills 2m-3m people in South Asia each year, while extreme heat kills 0.1m-0.6m. The government aimed to reduce aerosol concentrations by 20-30% relative to 2017 levels by 2024, extended to 40% by 2026. Many cities missed the 2024 target. In the Delhi Legislative Assembly election campaign earlier in 2025, all three major parties promised to clean up the air.
According to UN data compiled in 2022, Indian cities are among the loudest in the world. Noise levels on Delhi's streets average around 75dB—four times louder than the threshold recommended by the WHO. Much of the racket comes from road traffic, above all from the incessant blare of horns. More than 60m Indians suffer hearing loss, which researchers attribute partly to noise pollution. A review in 2020 concluded that louder road-traffic noise raises the risk of heart disease. Poor city planning has made traffic chaotic as trucks, rickshaws, motorcycles and pedestrians jostle for space. Data from thousands of scooters found that riders in Kolkata honk roughly 131 times an hour. Mercedes-Benz has adapted its horns in India to withstand heavier use.
Air pollution is a year-round problem in Delhi: in 2024 the city did not record a single day in the "good" air category and just 65 in what the government calls "satisfactory". The problem is expanding geographically—Kolkata's Howrah Bridge is often invisible, and even Mumbai's skyline vanishes behind the haze. Some 1.7m people die annually from causes related to bad air, according to the Lancet. In 2019 Dalberg, a consultancy, estimated the annual economic loss from air pollution at 3% of GDP. A junior health minister recently told parliament that there is "no conclusive data" linking pollution to death and disease. The latest budget, delivered on February 1st 2026, cut funding for pollution control. Businesses are finding it harder to attract talent: foreign executives decline jobs in India because of the air, and a cricket match between India and South Africa was called off because smog made it impossible to see the ball.
Only 10% of Indian households had an air-conditioner in 2023. Annual air-conditioner sales more than doubled in the five years to 2024, to 14m units. Sales tax on air-conditioners sits at the highest rate of 28%. India's minimum energy-efficiency standards are so low that the vast majority of units sold would not be eligible for sale in China. India has ratified a global treaty to phase out 85% of hydrofluorocarbons by 2047.
India's electricity distribution companies (known as discoms) are in a dire state. Globally, distributors aim to lose no more than 7.5% of power that enters their networks through shoddy cables, theft and unpaid bills; in China they lose 3-5%. India's losses come in at 16%, making its discoms some of the world's least efficient. The root cause is political: promises of free power for farmers without the cash to pay for them, a trend that gathered pace in the 1990s. Discoms now owe some $80bn, or 2% of GDP. Unable to borrow, they have let pylons and substations decay. In several states, incumbent parties have lost votes by trying to rescind free-power promises.
Free power for farmers has distorting effects. It makes water-hungry crops artificially attractive, which is why so much rice is grown in semi-arid states such as Punjab, depleting water tables. Meanwhile, higher tariffs for commercial users mean manufacturers pay around 50% more for electricity than they should. Power prices for industrial users are far higher in India than in places such as China, Vietnam or Indonesia; adjusted for purchasing power they are among the highest in the world. Many big users exit the system altogether by building their own power plants.
The eastern state of Odisha offers a model for reform. Six years ago its four state-run discoms were deep in debt, leaking 25-30% of their power. The state set up a joint venture with Tata Power, which has since cut power losses by almost half while holding prices flat. Odisha's discoms are now among the best-run in the country. The central government is preparing a bill to foster more competition and reduce subsidies, and is reportedly considering an $11bn bail-out fund for indebted discoms, contingent on states opening up to the private sector. Uttar Pradesh, India's most populous state, is mulling privatisation and has studied Odisha's example.
India has nearly doubled its power-generation capacity in recent years—half of which is now renewable—and produces a surplus. Renewables, including hydro, account for 224GW of the 472GW installed generation capacity. The government has ambitious plans for renewables to provide half of a total capacity of 1,000GW by 2030. Three-quarters of generation is still met by dirty thermal-energy plants. During heatwaves, air-conditioning alone accounts for a fifth of power demand. By mid-2025 India had seen four consecutive months of decline in coal-power generation, aided by a 14% increase in renewable generation. India's imports of finished solar panels have stagnated as the country seeks to build its own supply chain. Narendra Modi is expected to visit China for the first time in seven years; Indian firms are exploring joint ventures with Chinese counterparts in electric vehicles and batteries.
India is in the midst of a huge construction boom. Developers in its eight biggest cities launched 362,000 housing units in 2025, up from just under 225,000 in 2019. Railway stations, airports and other infrastructure are getting facelifts or being built brand new.
Kerala, nestled in India's south-western corner, has a population of 36m. On November 1st 2025 it declared that it had eliminated extreme poverty, becoming the only state in India to do so. According to the government's "multidimensional poverty index", less than 1% of Keralites were defined as poor in 2019-21, by far the lowest rate in the country (the all-India average was 15%).
Kerala's politics are distinctive: power at the state level alternates between the centre-left Congress and the further-left Communist Party of India (Marxist), which is currently in power. The Hindu-nationalist BJP has only ever won a single parliamentary seat in the state's history as a modern polity. Just over half the population is Hindu, compared with 80% nationally; large Muslim (27%) and Christian (18%) minorities mean that identitarian politics resonate less. Regular changes of government keep the communists responsive, unlike those who ruled for 34 years in West Bengal, who grew stagnant and corrupt.
Kerala worked with local councils and community organisations such as Kudumbashree, a women's co-operative with over 4m members, to identify 64,000 households in extreme poverty. Local officials then drafted and implemented "micro-plans" to lift each household out. Decentralisation also helped during the covid pandemic, especially with contact tracing and targeted local lockdowns.
Leftist rule may have made Kerala more equal, but it has stifled growth and investment. Thousands of trade unions emerged at the height of communist dogmatism in the 1960s and 70s and became a nuisance for businesses and citizens alike. Industry accounts for only a quarter of Kerala's output, a share that has barely budged in two decades. Next-door Tamil Nadu is at 33%. Overall growth—6.2% last year—slightly trailed the national average. Youth unemployment of around 24% is the second-highest in the country, despite its youngsters being the most literate in India. The state's income figures are flattered by vast remittances from the Gulf, which has for generations lured Keralite migrants with brighter prospects. The state ranks ninth among the 15 states that the Economist Intelligence Unit tracks for business environment, well behind leaders Tamil Nadu and Gujarat. The Communist Party has sought to distance itself from unions, and now courts investors and hosts startup summits.
An estimated 1.7m Keralites live in the Gulf, equal to 5% of the state's population and close to 11% of its workforce. K.P. Kannan and K.S. Hari of the Centre for Development Studies, an Indian think-tank, calculate that by the mid-2010s remittances from the region were equivalent to about a quarter of the state's output—more than both its value added in manufacturing and its public spending. Consumption per person in Kerala is nearly three-quarters above the Indian average. Much of the remittance windfall is spent on building houses and buying cars, which raises living standards but not productivity. Businesses struggle to match wage expectations hoisted high by labour-market links to deep-pocketed Gulf employers, so companies prefer to set up shop in business-friendlier places like Tamil Nadu. The number of Keralites in the Gulf has plateaued in recent years as Gulf countries reserve certain jobs for citizens, and their remittances could decline by 20% in 2026 as knock-on effects of the Iran war hurt the region's economies.
Tamil Nadu, a littoral state in India's south-east, is roughly as populous and as rich as Gujarat. Last year its economy expanded by 11%, making it India's top performer among states that have reported figures. The spurt has much to do with electronics manufacturing—and in particular Apple's decision to increase the number of devices it makes in India. Tamil Nadu exported around $15bn of electronics in the last financial year (about 40% of India's total), up three-fold from 2022-23. It is also a big maker of cars, motorbikes and lorries, and has picked up some of the tech-services and back-office work usually associated with Bangalore and Hyderabad.
Tamil Nadu lags Gujarat in infrastructure: the electricity grid "is atrocious" by comparison, and it has invested less in humongous highways. Yet when it comes to creating a healthy and well-educated workforce, Tamil Nadu outstrips most peers. Its primary-health centres have about 60% more doctors than Gujarat's; its public hospitals have more than twice as many beds (and the most, in absolute terms, of any state). Over 80% of its youngsters stay in school for the maximum period. Around half of young adults go on to college or university (the national average is 28%). The state started social reforms a century ago; many other Indian states remain "feudal bastions". Far fewer Tamils live in very poor conditions than Gujaratis, despite similar GDP per person.
Success in social policy boosts industry. Tamil Nadu's many engineering colleges produce striking amounts of talent, and the state's well-educated female workforce has been a selling point for electronics-assembly firms (which say they prefer women for their smaller hands). About 40% of all the women who work in manufacturing in India are employed in Tamil Nadu.
Gujarat, with some 70m people on India's west coast, has outsized importance in Indian politics. Modi served as its chief minister for almost 13 years before becoming prime minister in 2014, campaigning on a promise to turn all of India into Gujarat—synonymous with efficient governance, ease of doing business, high growth and first-class infrastructure. Amit Shah, his home minister and BJP chief strategist, is also Gujarati, as are Mukesh Ambani and Gautam Adani, whose conglomerates run everything from ports to telecoms. Modi flew to Delhi in Adani's private jet upon becoming prime minister.
Gujarat has a history of communal violence dating back to the late 19th century. A pogrom in 2002, while Modi was chief minister, killed about 1,000 people, mostly Muslims. Ahmedabad is India's most religiously segregated city. Despite making up a tenth of the population, no Muslim has been elected to Parliament from Gujarat since 1989. The BJP has held power there uninterrupted since 1998. A government survey in 2021 found that 40% of Gujaratis consume meat, undermining the state's famed vegetarian image.
Gujarat is home to about 5% of India's population but produces more than 8% of GDP and accounts for more than a quarter of exports. In the decade to 2022-23, its economy expanded at about 8% a year at constant prices. Income per person is 60% above the national average. For generations the state has prospered as a manufacturer of textiles, polisher of diamonds and hub for shipping. Over roughly 20 years Gujarat boosted its power-generating capacity five-fold and earned a reputation for an ever-expanding network of high-quality roads. Yet nearly 12% of Gujaratis live in "multidimensional poverty"—five times more than Tamil Nadu—and less than half of the state's youngsters study to high-school level, below India's national average of 58%.
Mohandas Gandhi and Muhammad Ali Jinnah, respectively the "father of the nation" of India and of Pakistan, were both Gujarati. So was Sardar Vallabhbhai Patel, India's first home minister, who cajoled 565 princely states into joining the union.
India is home to around a fifth of the world's university-age population but has no entry in the top 100 of international university league tables. China, having only broken into the global top 100 in the 2010s, now has the world's highest number in many rankings.
At the Indian Institutes of Technology (IITs), over 60% of the top 100 performers migrate abroad, mostly to America. Nearly a third of international students in America are from India. Admission rates for India's most prestigious institutions sometimes sink to 0.2%, against 3-9% for America's Ivy League.
In the past decade India has spent between 4.1% and 4.6% of GDP on education. China's spending as a share of GDP may be roughly similar, but its GDP per person is five times that of India's. India lacks the rupees to match China's efforts to lure back academics from the West.
Indian academics teach from a government-dictated syllabus and endure oversight by the all-powerful University Grants Commission. Hiring at public universities is hostage to the ruling party of the day. In 2024 India ranked as "completely restricted" in the Academic Freedom Index by Scholars at Risk and V-Dem, the lowest score since the 1940s.
In 2017 an "Institutions of Eminence" programme was launched to reward promising universities with more autonomy and funds, but not enough suitable candidates could be found. A new National Education Policy in 2020 made bold recommendations to curb government oversight, but reform is slow and the policy's proposal to switch from English to Hindi at central universities would hold back institutions trying to compete globally.
The rise of private universities may be India's best hope. Two decades ago there were fewer than 20; today there are over 400, accounting for around a quarter of total academic enrolments. Many are funded by big industrial groups and are snapping up foreign faculty members. Exempted from the public sector's expansive affirmative-action programme and government say over appointments, private universities can poach top talent as they see fit.
India supplies around 70% of applicants for America's H-1B "high-skilled" worker visa as well as about 30% of international students to America—more than any other country. Indians also make up 25% of international students in Britain and around 40% of those in Canada. In total 1.8m Indians are studying abroad. Cash from emigrants is worth around 3% of GDP, covering about 40% of the trade deficit. Rich countries became the dominant source of remittances for the first time in 2024, overtaking the Gulf countries.
Tighter migration policies across the rich world are reshaping flows. New applicants for America's H-1B visa must now pay an upfront fee of $100,000. Britain has reduced the length of its post-study visa from two years to 18 months. Canada has capped foreign-student numbers. In the "big four" English-speaking countries—America, Britain, Canada and Australia—the number of Indian students has dropped by roughly a quarter. Germany has recorded a 68% rise in Indian students over two years as it relaxes rules on skilled migration and expands English-language programmes. Enrolments in France have risen by more than a third after it introduced foundation-year French-language courses and added more postgraduate degrees in English. Russia has seen a 59% jump.
Economists argue that the migration of software engineers from India to America was neither a "brain gain" nor a "brain drain" but "brain circulation": the knowledge that high wages were available to the lucky few who came through the H-1B lottery encouraged Indian students to learn computer science and India's technical institutes to expand their courses. The challenge, suggests Chinmay Tumbe of the Indian Institute of Management in Ahmedabad, will be persuading the best scientists to return to India, as China did with its own high-flyers, known as "sea turtles".
India's IT exports are now worth more than $220bn annually, more than the $135bn the country earns in total from remittances. Gaurav Khanna of the University of California, San Diego, argues in the Journal of Economic Perspectives that waves of Asian migration to America facilitated this "brain circulation": many Indians earned software-engineering degrees hoping to seize Silicon Valley opportunities, and those who stayed behind created a new export industry deliverable remotely from places like Bangalore.
India's address system is notoriously unreliable. The Department of Posts estimates 750m households, businesses and other discrete locations exist in the country. Estimates of roads without names nationwide range from 60% to 90%. When street names exist, signage often does not; official names frequently differ from those in common use, and politicians regularly change the names of streets and even cities. Around 30% of postcodes are incorrectly written.
Rural land records use a mishmash of colonial and pre-colonial revenue systems, with different officers assigning different number schemes across states. The sub-division of plots over the decades adds an ever-expanding series of numbers. Different documents frequently have different, if similar, addresses for the same property, driving up the cost of verifying land ownership and increasing the risk of fraud.
The combined hit of inefficiencies created by poor addresses adds up to about 0.5% of GDP, according to Santanu Bhattacharya of MIT Media Lab. The government is working on digital solutions including a "Unique Land Parcel Identification Number" (a 14-digit alphanumeric identifier), a "Unique Property Identification Code" for some cities, and a 10-character "DIGIPIN" from the postal department.
Clusters of luxury residential towers—known as "gated communities"—are proliferating across Indian cities, offering residents gyms, pools, private cinemas and meditation areas. At last count in 2021 these developments hosted 16m households in India's 50 biggest cities, according to Redseer, a consultancy; by 2031 the number may double. "Ultra-luxury" homes accounted for around a fifth of all new developments launched in first-tier cities in the first quarter of 2025, according to Anarock, a research firm; developments classed as "luxury" or "high-end" made up a further half. Affordable homes represent less than 15% of recent launches.
Entry to many complexes is controlled by security guards; staff and delivery workers are often directed to use separate lifts. Many Hindu-run complexes explicitly or implicitly prevent Muslims from moving in. Big developments often secure their water supplies by drilling deep wells, depleting groundwater for everyone. By walling themselves away, India's rich secede from society: if the elites do not use public services, there is less pressure on the state to improve them. In 2024 the statistics ministry complained that Indians in posh apartment buildings refused to respond to surveys, one reason official data in India is wretched.
Between 2020 and 2024 the number of private jets registered in India jumped by nearly a quarter to 168. The number of monthly private flights tripled to more than 2,400, higher than anywhere else in Asia. In the year to March 2025, four of the ten most popular private-jet routes in Asia were domestic Indian ones, connecting Mumbai to Delhi, Bangalore, Ahmedabad and Pune. Indian buyers tend towards practical models and use their planes more intensively than Chinese peers. India lacks small airfields of the kind used for private jets in other countries, with only about 300 airfields in total compared with 16,000 in America. Taxes on private jets run at 28%, though chartering them out can cut the levy to 5%.
India is the world's biggest supplier of generic drugs, meeting about 20% of global demand. It also supplies nearly half the generic drugs Americans consume. Major generic firms include Cipla, Lupin, Sun Pharma (the country's biggest drugs company), Biocon, Mankind Pharma and Dr Reddy's. Dr Reddy's plans to launch a generic version of Wegovy in 87 countries when the semaglutide patent expires, targeting Brazil, Turkey and other emerging markets.
India's obese population is one of the largest in the world, along with America's and China's. In Delhi, every fourth resident has Type 2 diabetes. Unlike in America, where poorer people tend to be fatter, obesity in India peaks in the most prosperous southern regions and is more common among urban and university-educated populations. Between 2021 and 2024 Indian sales of weight-loss drugs grew five-fold to $72m. The semaglutide patent expires in India in 2026, after which generics firms will produce knock-offs; some analysts predict a 95% price cut. South Asians are unusually genetically predisposed to fatty-liver disease. Mankind Pharma is expecting trial results by the end of 2025 for what would become India's first oral weight-loss drug that could rival injectables.
The pharmaceutical sector relies on China for 70% of precursor chemicals.
About a third of India's constitution borrows directly from the Government of India Act of 1935, passed by Britain's Parliament to govern the colony. Jawaharlal Nehru described it as a "charter of slavery". The constitution is colonial both in drawing heavily on that document and in setting up a government that towers over the citizen, as the constitutional scholar Arghya Sengupta writes in "The Colonial Constitution". Where America's first amendment enshrines an inalienable right to free speech, India's first amendment severely curtails it.
In 2023 Modi's government replaced the Indian Penal Code of 1860 with the Bharatiya Nyaya Sanhita, a new code said to be fit for a modern country. The government made a point of excising the colonial-era crime of sedition, yet the new act contains provisions that scholars and judges worry could serve as a proxy for the old offence.
Indians have a deeply held belief—among leaders and citizens both—that the state sits at the centre of society and must control it. In Hindi this vision is called the maibaap sarkar, or "mother-father government". It is distinct from the "colonial hangover" of vestiges such as the country's elite gymkhana clubs and old-fashioned courts.
Fourteen of India's 28 states have anti-conversion laws, dubbed "freedom-of-religion laws". The more aggressive recent versions, passed since 2017 by state governments led by the BJP, punish "allurement" to convert—a term that can be stretched to cover most forms of proselytising. Would-be converts must give months of notice and register publicly; fellow citizens are invited to object, prompting a police inquiry in which the convert must prove they were not coerced. In March 2026 Chhattisgarh passed one of the most restrictive such laws, with a maximum penalty of life imprisonment and a fine of 2,500,000 rupees (~$26,000) for "mass or forced conversions". Maharashtra passed its own law the previous month.
The movement behind such laws is known as ghar wapsi ("homecoming"), the idea that conversion to "foreign" religions like Islam or Christianity denies Indians their "real" Hindu identity; a return to Hinduism is not counted as conversion. A related concern is "love jihad"—a conspiracy theory alleging that Muslim men lure Hindu women into marriage in order to convert them. Maharashtra's law bans "unlawful conversions through marriage" and decrees that the children of interfaith unions must adopt their mother's religion.
India's Supreme Court is considering whether anti-conversion laws flout constitutional rights to privacy and freedom of conscience.
Indian cities are home to street dogs, feral cats, stray cows, monkeys, snakes and the occasional leopard. Delhi has about 1m street dogs; last year people there reported 25,210 dog bites, and the number is rising. The UN reckons India suffers 18,000-20,000 rabies deaths annually, about a third of the global total; many victims are children. India has the highest rate of snakebite deaths in the world. Cows trample property, obstruct traffic and cause road accidents; monkeys steal food and phones.
Strict animal-protection laws prevent the public from driving out or killing feral canines. Religious sensitivities complicate enforcement: monkeys represent the Hindu monkey-god Hanuman, snakes are worshipped on Naag Panchami, and the cow is revered as a "mother". In 2025 India's Supreme Court gave authorities in Delhi eight weeks to put the city's stray dogs into shelters, then modified its order to allow dogs to be released once vaccinated and neutered.
Bangalore has expanded rapidly: only about 50% of land within its city limits was classed as built-up in 2008; by 2025, roads or buildings covered around 88%.
India's art market is booming, driven by a strong domestic economy rather than foreign speculators. Excluding the pandemic year of 2020, India's GDP has grown annually by an average of 7.1% since 2009. A new crop of buyers in their 30s and 40s has emerged post-covid, and major institutions outside India are taking an interest: the photographer Sohrab Hura recently had a solo show at PS1 in New York, and the painter Arpita Singh had her first show outside India at the Serpentine Gallery in London.
India's "modern masters"—a group of painters including M.F. Husain, F.N. Souza and S.H. Raza, who studied with and were influenced by European Modernist artists—fetch the highest prices at auction. India experienced a speculative art bubble in 2006-07, driven by international trend-hunters attracted to the BRICs story, which crashed with the global financial crisis. Today's boom is considered more stable because it is underpinned by domestic demand.
The Antiquities and Art Treasures Act of 1972 heavily restricts the export of any object more than 100 years old, as well as work by nine artists designated "national treasures". India's instinct for protectionism extends to culture as well as industry, and gallerists fret over confusing regulations that leave them uncertain whether they can import art to sell on consignment.
Uttar Pradesh, India's most populous state with 240m people, has long been one of the poorest. Under chief minister Yogi Adityanath, a Hindu-nationalist monk who has held the post since 2017, the state has undergone an infrastructure boom and grown faster than India as a whole in recent years. Income per head, at $1,300, remains about half the Indian average. His "Bulldozer Baba" approach to crime has reduced the homicide rate but drawn criticism for extrajudicial killings and the targeting of Muslim neighbourhoods. Noida, near Delhi, is a tech and manufacturing hub accounting for a tenth of UP's GDP with just 1% of its population.
Bihar is India's poorest state, with per-person income of about 66,000 rupees ($800) a year—less than a third of the national average. It is also India's youngest state, with a median age of just 22, compared with 30 nationally. Its 130m people are key to India's ambition of getting rich. Bihar's GDP has expanded by more than 60% in real terms over the past decade, but from a terribly low base; several other states, including neighbouring Uttar Pradesh, have grown faster. A mere 1% of the country's factories are in Bihar. Around half of its workforce toils on farms that are less productive than elsewhere in India. Only about one-third of 15-to-29-year-olds are in the labour force, among the lowest rates in the country. The caste system is particularly entrenched: villages are still organised into caste enclaves, and the upper-caste minority tend to be more educated and wealthier than everyone else. Bihar completed a state caste census in 2023. State-assembly polls were due on November 6th and 11th 2025.
India has 22 legally recognised languages and hundreds more besides. State boundaries were drawn on linguistic lines after independence: Gujarat for Gujarati speakers, Maharashtra for Marathi. Southern states have long bristled at attempts by the north to promote Hindi nationally. The Bharatiya Janata Party (BJP) promotes a Sanskritised version of Hindi that differs from the varied demotic Hindi spoken across the north.
Hindi has spread without—or despite—government efforts, propelled by Hindi-language pop culture from Mumbai, the growing use of the Roman alphabet for Hindi words online, and migration from poor northern states to the prosperous south. English is also rising as the language of economic mobility. A study by the Indira Gandhi Institute of Development Research found the chance that two random Indians could speak a common tongue was about one in four in 2011, up from one in five in 1971.
India's women won the Cricket World Cup for the first time on November 2nd 2025, beating South Africa before 45,000 in a packed Mumbai stadium and 200m watching on screens. India became the first non-Western country to be crowned women's world champions. The Board of Control for Cricket in India (BCCI) ordered gender parity in match fees around 2022, and launched the Women's Premier League (WPL) the following year—the female version of the Indian Premier League, the sport's most lucrative franchise tournament. India's men won their first World Cup in 1983.
The BCCI, though nominally independent, acts in practice as a wing of the BJP. Until the end of 2024 its boss was Jay Shah, the son of Amit Shah, India's home minister and Modi's right-hand man. Jay Shah now runs the International Cricket Council (ICC), the sport's global governing body. Matches between India and Pakistan are the most watched in any cricket tournament; advertising rates are set accordingly, with much of the benefit accruing to India.
During the 2026 men's T20 World Cup, hosted in India, cricket became entangled in South Asian geopolitics. After a BJP politician objected to the Indian Premier League's Kolkata team purchasing Mustafizur Rahman, a Bangladeshi bowler, the BCCI forced the team to drop him. Bangladesh—with which relations have worsened since Sheikh Hasina fled to India in 2024—asked to move its World Cup matches to Sri Lanka, arguing India could not guarantee its players' security; the ICC excluded Bangladesh and replaced it with Scotland. Pakistan then banned its team from playing its fixture against India, citing solidarity with Bangladesh but calculating that pulling out of the most-watched match would hit India's advertising revenues. After ten days of backchannel negotiations, Pakistan relented, and Bangladesh faced no financial penalty.
India and China have long disagreed on where their border lies. Each side claims vast swathes held by the other. In lieu of a border they have a Line of Actual Control (LAC), but even that is imprecise: in a dozen or so areas the two sides differ on where it runs. In 2020 a bloody clash in the Galwan valley in Ladakh—the worst mêlée between the two countries in more than 50 years—blew up ties between the world's two most populous countries. Vijay Gokhale, a former Indian ambassador to China, says the Galwan clash took Sino-Indian relations to their "lowest point since the 1962 war". Both sides rushed troops to the region and began building infrastructure. Direct flights stopped for five years; tourism was halted; India began turning away Chinese investment.
After Galwan each side pulled its forces slightly back from the LAC, suspended some patrols and created buffer zones which neither side could enter. In late 2024 a diplomatic breakthrough reduced friction further: the two sides agreed to allow each other to resume weekly foot patrols at two points (Depsang, a high-altitude plain, and Demchok, a valley). Patrols are co-ordinated so that troops do not pass within 300 metres of each other; soldiers exchange a "friendly wave". During a four-day war between India and Pakistan in May 2025, India felt confident enough to divert two brigades from the LAC to the border with Pakistan.
In 2020 India had a single division in Ladakh. By late 2025 it had more than twice that, plus an armoured brigade and permanently deployed air-defence systems. In mid-November 2025 India opened a new airbase at Nyoma, just 25km from the LAC. Operating at these altitudes is hard: Leh is at 11,500 feet, engines and batteries have shorter lives, and soldiers need two weeks to acclimatise fully. Both sides now have similar numbers of tanks and armoured forces in the region. But China's side of the LAC—Aksai Chin, which India claims—is a plateau, allowing it to move forces to the LAC in only two nights, much faster than India can. Indian officials acknowledge that real-time satellite coverage remains patchy.
The border conflict is increasingly a race to plant infrastructure. China has moved civilians closer to the border near Pangong lake, built a new bridge over the lake (opened July 2024) and increased the number of structures along the LAC ten-fold since Galwan. India has constructed underground ammunition dumps and tunnels and is building a new road over the Saser La pass (17,660 feet) to provide routes less vulnerable to Chinese interdiction. But China's rate of infrastructure development is at least four times India's.
Yet Ladakh's topography complicates any simple assessment of the military balance. Chinese planes taking off from the heights of Aksai Chin can carry less than Indian warplanes taking off from plains south of Ladakh, and precision strikes in the mountains are tricky. Chinese officials, unlike those dealing with America, always pick up the phone to Indian officers; parlay sessions stretch to several hours. "What I can say," observes Mr Gokhale, "is that the state of armed coexistence will remain for a long while."
Personality cults pervade all levels of Indian politics. India's biggest cricket stadium is named after Modi. A rail service to the capital is called Namo Bharat, after a short version of his name. There is even a road named after his mother. Supporters of Indira Gandhi, an autocratic prime minister, famously conflated her with the nation itself, claiming that "India is Indira and Indira is India."
Other politicians are catching on. In Maharashtra, the state's leader has sponsored billboards showing him showering rose petals at the feet of a medieval warrior-king. In states run by the opposition, the local satrap is usually as inescapable as Modi is elsewhere: Mamata Banerjee, the chief minister of West Bengal, is plastered across walls and public spaces; Tamil Nadu's leader, M.K. Stalin, is seen everywhere in his state, often alongside his late father, a former chief minister.
The phenomenon extends beyond elected officials. After E. Sreedharan, a civil servant, oversaw the successful roll-out of Delhi's metro network in the early 2000s, his thoughts on public transport came to be treated as pronouncements from above. A.P.J. Abdul Kalam, a scientist who played a big role in India's nuclear tests of 1998, was so admired that he was made president. India has barely updated its structures of governance from the feudal-colonial system it inherited at independence, and officials are still able to rule by diktat; voters know this and reward charismatic characters accordingly.
India's "VIP culture" is pervasive and sometimes lethal. There is no public infrastructure so important that it cannot be disrupted for VIPs. Crucial roads across India's already congested cities are routinely blocked to allow swift passage for public servants. Some state leaders travel in convoys that rival the American president's; even minor ministers get police escorts that run traffic lights and bully other motorists. When Narendra Modi visited Mumbai to campaign for the general election in 2024, authorities shut down a metro line as well as bus services. After a bombing in Delhi in 2025, relatives of victims were prevented from entering the hospital to see their loved ones even as VIPs were escorted in. At a big religious gathering in north India in 2025, a stampede killed at least 37 people; eyewitnesses said crowds were pushed into crowded pens because vast spaces had been reserved for VIPs. When another stampede occurred at a later religious event, pilgrims reported that the exit had been blocked for VIPs, leaving only one point for ingress and egress. VIP culture operates on an ancient principle of India's highly stratified society: that servant and master must never drink from the same glass, sit at the same table or pass through the same doorway.
The government has renamed the street on which Mr Modi lives from Race Course Road to the Path of Public Welfare. In 2025 it changed the names of state governors' residences from Raj Bhavan (Government House) to Lok Bhavan (the People's House). In February 2026 Mr Modi inaugurated a new prime-ministerial office christened Seva Tirth, or Sacred Place of Service. Mounted on the outside is a legend that translates as "The citizen is akin to God."
Manipur is a state in India's north-east; its capital is Imphal. In May 2023 a shocking outbreak of ethnic violence erupted between the mostly Hindu Meitei community, which makes up around half of the state's population, and the Kukis, mainly Christian hill tribes who account for 16%. The proximate cause was a court recommendation that the Meiteis be named among India's "scheduled tribes", handing them preferential access to government jobs and tribal land—a change the Kukis fiercely opposed. Several hundred people were killed, thousands of homes destroyed and tens of thousands displaced. By early 2026 around 50,000 people from both sides remained in refugee camps, surviving on government stipends of roughly 84 rupees ($0.90) a day.
The state remains partitioned along ethnic lines: Meiteis stay in Imphal and its surrounding areas; Kukis in the hills. Violence still strikes sporadically. Kukis demand a semi-autonomous territory carved out of the state; the Meiteis and Delhi fiercely oppose this. In the 2024 general election the opposition Congress party won both of Manipur's parliamentary seats, a rebuke to the BJP. The BJP's chief minister hung on until February 2025, when "president's rule" was invoked—a constitutional provision suspending state-level democracy and transferring control to officials in Delhi.
Manipur has been riven by a decades-long insurgency, led largely by Meitei groups who desire independence. That had been quelled in recent years, but deepening frustration and alienation risk its resurfacing.
India's rivers are a growing source of regional tension. The Indus Water Treaty, a water-sharing deal with Pakistan since 1960, was suspended by India in April 2025 following a terrorist attack in Kashmir, though India still shared flood forecasts afterwards. Thousands of Bangladeshis protested against India's influence over the flow of the Teesta river, a tributary of the Brahmaputra (known as the Jamuna in Bangladesh), in October 2025. India wants to boost its hydropower capacity of 42GW by more than 50% by 2032, and perhaps build 200 new dams. It also plans a mega-dam downstream from a $167bn Chinese dam on the Brahmaputra (called the Yarlung Tsangpo in Tibet), which would be the world's largest if completed. Between 2019 and 2023 there were 191 water-related disputes in South Asia, according to the Pacific Institute.
See Naxalite insurgency. Amit Shah, the home minister, vowed in early 2026 that India would be Maoist-rebel-free by March 31st. By February 2026, the number of districts with Maoist activity had fallen to only seven out of some 800, down from a third of India's districts at the movement's peak around 2010. Indian forces say they have killed 748 guerrillas since 2024, a record tally.
Bangalore's tech billionaires are rethinking the role of the super-rich in India. Old-money philanthropy flows mostly to education and health, which together account for half of all donations. The newer generation of donors, many of them engineers from IT-services firms, focuses on institution-building: governance systems, brain-research labs and venues promoting science. Nandan Nilekani, a co-founder of Infosys, is India's second most generous individual philanthropist, according to Hurun; his wife, Rohini Nilekani, is third. Kris Gopalakrishnan, another Infosys co-founder, has donated millions to set up brain-research labs in Bangalore and Chennai. Kiran Mazumdar-Shaw, the founder of a biotech firm, has funded a Science Gallery in Bangalore. Nikhil Kamath (39) and his brother Nithin (46), who founded a popular trading platform, are now also becoming generous donors. Many of Bangalore's tycoons have experience of being normal people—taking public transport and wrangling with public services—which sets them apart from inheritors in Mumbai or Delhi.
Bollywood, long an apolitical but patriotic place, retained a liberal streak through Modi's first term in office, making its usual fare of romances and comedies even as other parts of the media fell under government control. That changed in 2020 when a campaign to paint the industry as a den of drug-addled homosexuals cowed many. Then came the detention on bogus drug charges of the son of Shah Rukh Khan, India's biggest star (and a Muslim). The message was clear: no one is safe.
Since then Bollywood has embraced propaganda. Hits include "The Kashmir Files", which dramatised the violent expulsion of Hindus from the Kashmir valley, and "The Kerala Story", about Hindu girls manipulated by Muslim men into converting to Islam. "Dhurandhar", released in December 2025, became the highest-grossing Bollywood movie at the domestic box office; its sequel "Dhurandhar: The Revenge", a four-hour action extravaganza released in March 2026, is on its way to surpassing it. The films depict an Indian spymaster sending an undercover agent to infiltrate criminal gangs in Karachi that have been supporting Pakistan's spies and terrorists. Critics dismiss them as undisguised propaganda not for the government or even the ruling party but for Modi himself. Their genius, however, is to reflect the world many Indians, browbeaten by years of shrill pro-Modi messaging on television news and social media, already believe to be real.
The Asian Development Bank reckons that more than 40% of Asia's urban population lives in substandard accommodation. India's housing shortage has been estimated at up to 47m homes.
Most people need some of their problems to help take their mind off some of the others.