India explores Arctic opportunities balancing trade, climate and geopolitics

Source: The post India explores Arctic opportunities balancing trade, climate and geopolitics has been created, based on the article “Exploring India’s potential in the Arctic region” published in “The Hindu” on 23 April 2025. India explores Arctic opportunities balancing trade, climate and geopolitics.

UPSC Syllabus Topic: GS Paper 2 – International Relations — Important International institutions, agencies and fora- their structure, mandate.

Context: As global trade faces new challenges, melting Arctic ice is opening the Northern Sea Route (NSR), a shorter trade path between Europe and Asia. This development has triggered discussions about India’s strategic, economic, and climate-related interests in the Arctic region.

For detailed information on India’s Polar Expeditions in Arctic and Antarctic read this article here

Melting Ice and the Rise of the Northern Sea Route

1. New Trade Possibilities: Arctic sea-ice is shrinking by 12.2% per decade (NASA). This is opening up the Northern Sea Route (NSR), connecting the Atlantic and Pacific Oceans. It is now the shortest trade route between Europe and Asia. This will save time and reduce freight costs.
2. Strategic Importance for India: India’s interest in NSR fits its long-term aim of developing mega ports and new sea routes. This is not only for economic gain, but also for geopolitical advantage. The rising number of Observer nations at the Arctic Council, exceeding Arctic states, shows growing concern over existing trade routes.

India’s Arctic Presence and Policy Execution

1. Early Engagement and Scientific Roles: India signed the Svalbard Treaty in 1920. It has a permanent Arctic research base, Himadri, and is the only developing country besides China with such a base. It also worked with national and international agencies to study how Arctic ice loss may affect India’s monsoons and agriculture.
2. Need For Policy Implementation: India released its Arctic Policy in 2022, but it now needs focused action. The 2025–26 Budget allocated $3 billion to the Maritime Development Fund to strengthen India’s shipping sector. It also supports the development of shipbuilding clusters. India must build ice-capable fleets for Arctic navigation.

Climate Warnings and Responsible Engagement

1. Environmental Risks: Cargo on the NSR rose sharply—from 41,000 tonnes in 2010 to 37.9 million tonnes in 2024. Meanwhile, global temperatures breached the 1.5°C mark in 2024, exceeding the Paris Agreement threshold. According to Nature Climate Change, even a single year at this level could mark long-term damage.
2. The balance between growth and protection: India must act cautiously. It must protect the fragile Arctic ecosystem while using trade benefits wisely. This is a critical policy dilemma—how to avoid accelerating climate disaster while staying economically competitive.

Geopolitical Partnerships and Regional Strategy

1. Russia as a Natural Partner: Russia has a long Arctic coastline and strong maritime capacity. During the Modi–Putin summit, both countries agreed to form a working group on the NSR. The Chennai–Vladivostok Maritime Corridor can serve as a gateway to Russian Arctic ports like Pevek, Tiksi, and Sabetta.
2. Risks of Aligning Too Closely: However, close cooperation with Russia could imply support for China’s Polar Silk Road, part of its Belt and Road Initiative. This would let China bypass the Malacca Strait and gain greater control over Arctic routes.
3. Balancing Global Powers: On the other hand, aligning with the U.S. might limit access to Russian Arctic resources. The ideal but difficult approach is to engage both blocs. India should also partner with Japan and South Korea, who share concerns about China–Russia dominance. Together, they can push for a more equitable Arctic Council.

Looking Ahead

The Arctic Circle India Forum on May 3–4, 2025, in New Delhi offers a key opportunity. India can use it to refine its Arctic policy, build partnerships, host stakeholder talks, and perhaps appoint a ‘polar ambassador’ to represent its interests.

Question for practice:

Examine how India is balancing its economic, strategic, and environmental interests in the Arctic region amid the opening of the Northern Sea Route.