Post Operation Sindoor: Modi’s policies sink India into economic and diplomatic crisis
Islamabad: Following the humiliating defeat in Operation Sindoor, Indian Prime Minister Narendra Modi’s government has adopted economic and diplomatic policies that have backfired, pushing the country into a deepening crisis.
According to Kashmir Media Service, political analysts say India’s double-dealing strategy on the global stage—swinging between Washington and Moscow—has shattered its credibility and dragged its economy into turmoil. In retaliation, the United States imposed a crippling 50 percent tariff on Indian exports, devastating financial markets and export industries.
The Trump administration stated that India is purchasing cheap oil from Russia and reselling it at inflated prices in global markets while indirectly financing Moscow’s war machine during the Ukraine conflict. As a result, Washington enforced tariffs in two phases: 25 percent on August 1, 2025, followed by another 25 percent on August 27, raising the cumulative tariff on Indian exports to 50 percent. Out of India’s 87 billion dollars in exports, nearly 55 billion dollars—destined for the U.S. market—have been directly hit.
The fallout has been severe. India’s stock markets crashed, with Sensex plunging by 849 points to 80,786.54, Nifty falling by 1.025 percent to 24,712, while BSE mid-cap and small-cap indices dropped by 1.34 and 1.68 percent respectively. The Indian rupee weakened to 87.68 against the dollar, its lowest in three weeks. Export industries are collapsing: in Tripura, the 16 billion-dollar ready-made garment sector has seen factory closures and order cancellations, leaving exporters without work beyond September. In Surat, Gujarat, where 10 billion dollars’ worth of diamond jewelry was annually shipped to the U.S., production units employing five million workers are now operating only half the month, with pay cuts and forced leaves becoming common.
Shrimp farming, once India’s leading export to the U.S., has suffered the heaviest blow, with costs soaring by 60 percent and prices plunging from 60 cents to 75 cents per kilo, directly affecting one million workers.
Analysts noted that the U.S. has sent a clear message over India’s tilt toward Russia: duplicity will no longer be tolerated. A scheduled U.S. delegation visit to India was canceled, ending prospects of negotiations. Meanwhile, Bangladesh, Vietnam, and China are rapidly filling the void left by India in global markets.
Observers say Modi’s much-publicized schemes, including Atmanirbhar Bharat and subsidy packages, have failed to offset the crisis. Export industries are shutting down, millions are facing unemployment, and financial markets remain in turmoil. India’s global reputation has been severely damaged, with Modi’s war hysteria and duplicitous policies pushing the country into a dangerous abyss from which recovery appears increasingly difficult.
