Thinking like a state in an age of cautious budgets

To think like a state is not to think expansively, but integratively. It is to see policy not as a collection of announcements, incentives, and fiscal arithmetic, but as an expression of intent about how power, resources, institutions, and society are to be aligned over time. 

Viewed through this lens, the Union Budget presented in Parliament today reflects both the strengths and the limitations of India’s current governing imagination. It is a competent, stabilising, and politically aware budget. Yet it stops short of the deeper economic reforms required to truly revitalise the Indian system.

The Budget demonstrates that the Indian state has learned to manage scale. Fiscal prudence, targeted welfare delivery, infrastructure spending, and macroeconomic stability are no longer episodic achievements; they have become part of administrative routine. This matters. A state that cannot maintain macro stability cannot claim strategic autonomy. 

In that sense, the Budget signals continuity, reassurance to markets, and confidence in India’s growth trajectory. It recognises that disorder is costly, and that credibility—domestic and global—is itself a form of national power.

But thinking like a state also requires confronting structural constraints rather than navigating around them. Here the Budget is cautious to a fault. Economic revitalisation does not come from incremental allocation alone; it comes from reforming the underlying architecture of incentives, institutions, and productivity. 

India’s economy continues to suffer from well-known bottlenecks: rigid factor markets, fragmented regulation, uneven state capacity, and a private sector that is often risk-averse because the cost of failure remains high. A reformist budget would have treated these not as background conditions, but as central policy problems.

The absence is most visible in the realm of economic freedoms. A state that thinks long-term must trust its citizens and enterprises to create value, while reserving its coercive power for rule enforcement rather than routine control. Yet India’s regulatory ecosystem still leans toward permission rather than facilitation, compliance rather than competition. 

Tax rationalisation, labour flexibility, judicial efficiency, and genuine ease of exit for firms remain politically sensitive but economically indispensable. Without addressing these, growth risks becoming extensive rather than transformative.

At the same time, it would be unfair to dismiss the Budget as unimaginative or timid. Governing a diverse democracy requires sequencing as much as conviction. Rapid reform without social absorption can generate instability, which in turn erodes state legitimacy. 

The Budget’s emphasis on welfare continuity, employment-linked incentives, and public investment reflects an awareness that economic policy is also social policy. A state that thinks only in terms of markets, and not social cohesion, misunderstands its own foundations.

Yet the deeper question remains unanswered: what kind of economy is India trying to become over the next two decades? A manufacturing hub integrated into global value chains? A services-led innovation economy? A continental market driven by domestic demand? Budgets that think like a state articulate direction as much as distribution. 

They signal which sectors will be freed, which protected, which disrupted, and which allowed to fail. In this Budget, the signals are reassuring but diffuse.

To think like a state is also to accept that reform is not an event but a discipline. It involves political risk, administrative overhaul, and the willingness to absorb short-term discomfort for long-term resilience. The Indian state today is capable, confident, and increasingly centralised—but it remains reform-shy at the margins where true productivity gains lie. Stability has been mastered; transformation remains deferred.

The Budget, then, is best read as a holding operation by a state conscious of its responsibilities but cautious of its reach. It keeps the system running, but does not yet rewire it. 

That may be sufficient for sustaining growth in the near term. It is unlikely to be enough for revitalising India’s economic system in a world where competitiveness is relentless and complacency is expensive. Thinking like a state ultimately means asking not only what is affordable today, but what is unavoidable tomorrow.

Power without vocabulary: The risks of inarticulate statecraft

India today operates in an environment that is at once familiar and radically new. Familiar because power, interest, territory, and security remain the core currencies of international and domestic politics; new because the forms through which these forces act—technology, finance, demography, information, and identity—have changed their scale, speed, and reach. 

In this context, India increasingly confronts a paradox: it possesses rising material capabilities and global visibility, yet often lacks a coherent language through which to think about, explain, and integrate its exercise of power. What is needed is not a new ideology, but a new language of statecraft—one that is precise, grounded, and capable of holding contradictions without dissolving into slogans.

For much of the post-independence period, India’s statecraft was articulated through a moral vocabulary. Non-alignment, strategic restraint, peaceful coexistence, and developmental solidarity were not merely policies but ethical positions. This language served India well in an era of bipolarity and limited resources. However, as India’s economic weight, strategic reach, and internal complexity have grown, the older idiom has begun to strain. 

Moral assertion without material follow-through invites scepticism; ambition without clarity invites miscalculation. A new language is required precisely because power without articulation becomes reactive, and articulation without realism becomes performative.

At the same time, calls for “hard realism” or “pure national interest” are equally insufficient. A language of statecraft that reduces policy to transactional deal-making or perpetual rivalry ignores the realities of a plural society and a democratic polity. India’s strength has never rested solely in coercive capacity. It lies equally in institutional legitimacy, social cohesion, and the ability to reconcile authority with consent. 

Any new vocabulary of statecraft must therefore recognise that internal order, social trust, and economic opportunity are not soft variables but central elements of national power. A state that cannot govern its diversity cannot project stability beyond its borders.

The global environment reinforces this need for balance. The world is not moving neatly toward either cooperation or conflict, but toward an unstable coexistence of both. Strategic autonomy today does not mean equidistance from all powers; it means the capacity to make differentiated choices without structural dependence. 

Similarly, development can no longer be framed as a purely economic process detached from security, supply chains, or technological sovereignty. The language of statecraft must therefore integrate economy, security, and society into a single analytic frame, rather than treating them as separate policy silos.

History offers guidance, but not templates. Ancient Indian thinkers understood that statecraft was an exercise in managing uncertainty rather than imposing order. Power was to be accumulated, restrained, and legitimised simultaneously. Yet nostalgia can be as misleading as amnesia. The task is not to revive past doctrines, but to recover a habit of strategic thinking that accepts ambiguity, anticipates second-order effects, and resists moral absolutism. A mature state does not need to declare itself virtuous; it needs to be predictable, credible, and resilient.

Ultimately, a new language of statecraft is about intellectual discipline. It requires speaking honestly about limits as well as ambitions, trade-offs as well as choices. It requires recognising that not every challenge is existential, and not every success is transformational. Most importantly, it requires moving beyond binary thinking—between idealism and realism, growth and welfare, security and liberty. 

India’s rise will not be judged only by what it achieves, but by how coherently it understands and explains its own actions. In that sense, the language of statecraft is not an accessory to power; it is one of its essential foundations.