India benefits as Russia and Iran face war fatigue

For Russia, the strain is becoming harder to ignore. Liquid assets in its National Wealth Fund have fallen to 1.8% of GDP from 6.5% before the war, while military spending, inflation and labour outflows are squeezing the economy. The deeper constraint is geopolitical: China is estimated to account for 33%-35% of Russia’s import-export volume, leaving Moscow increasingly dependent on Beijing in an asymmetric relationship. A compromise on Ukraine would not end Russia’s structural problems, but it could give it room to diversify trade and reduce its reliance on China, including by reopening more economic space with countries such as India.

Iran faces a different but equally familiar bind. The regime’s survival has become tied to its ability to avoid another full-intensity conflict cycle even as tensions around the Strait of Hormuz remain acute. Oman and India have both backed freedom of navigation through the waterway, underscoring that Tehran cannot dictate terms alone. Any deal that restores more predictable access to energy exports would improve Iran’s fiscal stability and buy time for reconstruction. For energy importers, that would be a net positive by broadening supply and easing some pressure on prices.

The strategic point for New Delhi is that it benefits from being seen as a relatively safe, non-aligned growth centre at a time when war-waging states need alternatives to China and more reliable commercial partners. India has already had to balance relationships carefully to keep supply chains open, preserve energy access and avoid being forced into a rigid bloc politics that would hurt trade. The article’s broader thesis is that, in a world of “wars without winners,” India’s recovery can be supported by a shift away from military maximalism and toward compromise-based economic realignment.

That also gives India a more useful role inside groupings such as BRICS and the Shanghai Cooperation Organisation. If those forums are not reduced to Beijing’s agenda-setting platforms, they can become venues for pushing the idea that fatigue, sanctions and fiscal strain are making settlement more rational than escalation. For the US, too, there is a risk in treating such discussions as automatically anti-Washington, when they may instead reflect the growing demand among partners for a less disruptive global order.

For investors, the implication is straightforward: the longer these conflicts persist, the more volatile energy, shipping, inflation and risk assets remain; the sooner compromise becomes politically viable, the better the outlook for emerging-market trade flows and for India’s role as a manufacturing and investment destination. India’s recovery story is safer when geopolitics moves from escalation to rebalancing.