Jaishankar calls for 'national security filters' in investment decisions, makes 'safe prediction' on Trump 2.0

External Affairs Minister S Jaishankar on Monday stressed the need to integrate “national security filters” into economic policymaking, including investment decisions, citing the growing global trend of leveraging trade for strategic purposes.

Speaking at the Confederation of Indian Industry (CII) Partnership Summit 2024, Jaishankar said, "Like it or not, we are increasingly in an era of leveraging, if not of weaponisation. Policy makers, therefore, have to place national security filters when it comes to economic decisions, including those of investment."

"This is the trend the world over, and we would ignore it at our own peril," he added.

The remarks came amid increasing global concerns over China's aggressive trade practices.

Jaishankar also stressed the need for partnerships with trusted allies to drive growth.

"Inorganic endeavours to rapidly grow will require collaboration with trusted partners. And that is exactly what we see as the beginnings underway."

Addressing the implications of the upcoming second term for Donald Trump as US President, Jaishankar acknowledged the unpredictability it might bring but expressed confidence in the deepening of strategic convergences between India and the US.

“The advent of the second Trump Administration is also obviously a major consideration in business circles. Obviously, the only safe prediction is a degree of unpredictability," he said.

“Where India is concerned, I can state with confidence that the strategic convergences with the United States have only grown deeper with time. They have created a larger environment in which more collaborative possibilities can be explored. Naturally, between two major economies, there will always be some give and take,” he added.

Jaishankar also touched on the complexities surrounding free trade agreements (FTAs), pointing to the challenges posed by subsidised and large-scale competition.

"In any economic conversation, FTAs inevitably arise as a possible avenue of partnership. There is much truth in that, but equally, grounds for some caution."

"A low per capita income country with small producers will have a natural reticence about excessive external exposure. This is all the more so if that exposure is to unfair, subsidised and large-scale competition.

"The nature of commerce and supply chains in the world is such that orthodox precautions are not always adequate. Yet, it would be unwise to forego opportunities and limit access," he said.

The working principle, Jaishankar noted, has to be one of proceeding with caution.