From Periphery to Pivot: How India is Recasting Global Order in the 21st Century

• The global system is undergoing rapid structural transformation, with Western dominance fraying due to economic stagnation, internal polarisation, and crises of legitimacy.
• India has emerged as a pivotal actor in the Global South, leveraging its human capital, services sector, and strategic diplomacy to challenge Western epistemic monopoly and assert multipolar influence.
• The exhaustion of neoliberalism in the West and the South’s call for equitable interdependency have led India to adopt a hybrid model combining market liberalisation with state-led industrial strategies.
• Through realist balancing and efforts to reduce its dependency, India is transitioning from a rule-taker to a rule-maker, helping to shape a multipolar, equitable, and interdependent global order.

The global system has never gone into such a quick structural transformation in the last ten years. Historian Giovanni Arrighi, in his 1994 book The Long Twentieth Century: Money, Power and the Origins of Our Times, characterised Western dominance, initially expressed through European imperialism, then consolidated under American hegemony in the post-1945 liberal order. However, in 2025, this world order is fraying. Western economies face stagnation, internal polarisation and crises of legitimacy in their institutions, and what many think is the end of the U.S.-centred cycle of capitalism. 

Simultaneously, the Global South, once dismissed as the periphery of the world system, has found its voice and is asserting its agency, and India is playing a very important role in that. India, in the last ten years, has emerged as a pivotal actor: not only as an economic and demographic powerhouse, but also as a civilizational state that challenges the epistemic monopoly of the West and is a serious contention for the United States.

This essay analyses the rise of a new world order through four major theoretical prisms: periphery theory, neoliberalism, realism and dependency theory. Each framework reveals a different dimension of the ongoing transformation, while together they illustrate how interdependency is being redefined around principles of equity and multipolarity rather than hierarchy and exploitation. 

Historical Periphery of the South: From Subordinate Margins to Strategic Centres

World-systems theorists such as Immanuel Wallerstein conceptualised the world economy as a triadic structure: core, semi-periphery and periphery. For much of post-industrial revolution modern history, the periphery, comprising Asia, Africa and Latin America, was subordinated to the industrial core of Europe and North America. Raw materials, cheap labour and markets in the periphery sustained the capitalist expansion of the core. India was deliberately deindustrialised under British colonialism, transformed into a supplier of cotton, opium and tea while becoming a vast consumer base for Lancashire textiles. 

Today, the very categories of periphery and core are being destabilised. China has already transitioned into a central node of global manufacturing. India, not yet fully industrialised, has leveraged its human capital and services sector to reposition itself. The Gulf states, Brazil and Indonesia similarly show that the periphery can now shape the flows of capital, technology and energy. The South is no longer merely passive; it has become active in shaping global governance institutions, from BRICS to the Shanghai Cooperation Organisation (SCO).

India is now a classic case study when it comes to understanding the “semi-periphery” evolving toward centrality. It is not a marginal economy, yet not fully a hegemonic one either. But much to the dismay of the West, it has developed its capacity to balance relations between the United States, Russia and China; its role as a refining hub for Russian crude. Though the U.S.-India relationship has hit a temporary roadblock the fact is the periphery theory thus highlights the erosion of the West’s monopoly and the ascent of the South. 

Neoliberalism: Crisis of the Western Model 

The late twentieth century saw neoliberalism institutionalised as the dominant global economic paradigm. It emphasised deregulation, privatisation, free trade and global financial integration. Institutions such as the IMF, World Bank and WTO enforced neoliberal reforms in the South under the guise of structural adjustment. But the 2008 financial crisis exposed neoliberalism after the West, especially the U.S. and Europe, experienced rising inequality, middle-class erosion, and saw the rise of political populism. After replacing the Keynesian consensus that guided the global economic principle, the neoliberal promise of perpetual growth has faltered, exposing vulnerabilities. Meanwhile, the Global South, particularly India and China, benefited from globalisation by becoming manufacturing and services hubs. 

India’s 1991 liberalisation allowed it to be integrated into the global neoliberal order. That made India an Information Technology powerhouse as foreign investment increased, and GDP growth accelerated. Yet, neoliberal reforms also deepened inequality, created dependence on global capital flows, but that was a natural progression. However, what makes India unique in the current dispensation is its hybrid model: neoliberal participation combined with state-led industrial strategies such as Atmanirbhar Bharat, which is playing a very important role in maintaining its strategic autonomy. 

As the political and economic climate has changed in the West due to the exhaustion of neoliberalism, the South’s call for more equitable interdependency is now gaining strength. India’s push for reformed multilateralism (UN Security Council, WTO reform, G20 inclusion of the African Union) reflects a post-neoliberal order where rules are not dictated solely by Western interests, leading to a more plural global economic system. 

Realism: Power Politics in a Multipolar World 

Realism emphasises the centrality of power and national interest in international relations. The world is shifting from a U.S.-led unipolar moment (1991–2008) toward a multipolar order. The West’s inability to end the Russia-Ukraine conflict is economically and politically draining them. They are no longer able to dictate their military dominance and are now increasingly challenged by India, China and Russia. 

The Russia–Ukraine war and India’s balancing diplomacy illustrate the multipolar drift. No single actor can dominate; instead, regional powers carve out spheres of influence. The Middle East, long dominated by U.S. security guarantees, now hosts new alignments. Saudi Arabia is aligning with China, and the UAE is aligning with India, as other countries across the world seek opportunities. 

India’s Realist Strategy

India right now is the best example of classical realist balancing. It maintains strategic autonomy and has shut the door on the U.S sanctions, which are upsetting for importing Russian oil. India is in the Quad with the U.S., but it is also a member of BRICS and SCO. Its defence modernisation, space program, and Indo-Pacific strategy all reflect a realist pursuit of power. India’s realism is pragmatic, rooted in survival in a contested neighbourhood (China, Pakistan) while leveraging opportunities in the global arena.

Realism has the veneer to appear hostile to equity, yet India’s realist practice on the international stage suggests otherwise. By refusing to be a subordinate ally, India asserts equality in partnerships. Culturally, India was never about domination but about securing a seat at the table as an equal among powers in the new world order. However, it is now being pursued not through moral appeals but through power projection and balanced escalation. 

Dependency Theory

Dependency theory, rooted in Latin American scholarship, argued that underdevelopment in the South is not accidental but structured by global capitalism. The periphery is locked into exporting low-value goods while importing high-value ones, perpetuating dependency on the core. However, gone are the days of colonial and Cold War dependencies that were material in nature. But today it is built around technology. Global South countries rely on Western digital infrastructures (Google, Microsoft, SWIFT), pharmaceutical patents, and military-industrial complexes. This created “neo-dependency” even in an era of nominal independence. 

However, in India, in the last twenty-five years, it has consciously resisted dependency traps. There has been a sustained effort to develop indigenous technology, such as satellites, nuclear technology, and digital platforms (like UPI, Aadhaar), to avoid reliance on Western systems. In fact, India is working on its own Operating platforms like Bhar OS and Maya OS. Its diversification of energy sources- Russian crude, Middle Eastern LNG, and renewable expansion has prevented single-source dependence. Even in pharmaceuticals, India has emerged as the “pharmacy of the world,” reversing dependency flows by exporting affordable generics. 

India’s Role: From Rule-Taker to Rule-Maker

India is now firmly in the centre of this new emerging order as the voice of the Global South. The South, particularly India, is reshaping international systems toward interdependency grounded in equity. This is now made possible because India, with the world’s largest population and a rising middle class and its Purchasing Power Parity (PPP), is both producer and consumer, shaping global supply chains. But more importantly, India is still the only functioning civilisation and now wants to assert its rise not just economically, but it is now in a position to offer a non-Western model of modernity. 

The U.S. is upset that it is not towing its line, as India’s refusal to align exclusively with any bloc makes it a swing power capable of shaping multipolarity. What the U.S. has failed to understand under President Donald Trump elucidated Russian President Vladimir Putin when he said, “You have countries like India with 1.5 billion people, China, powerful economies, but they also have their own domestic political mechanisms and laws. When somebody tells you that they are going to punish you, you have to think, how can the leadership of those big countries react? They had difficult periods in their histories too, like colonialism, tax on their sovereignty during a prolonged period of time. You have to understand, if one of them shows weakness, his political career will be over. So that influences his behaviour.” 

Conclusion: Toward Equitable Interdependency

The West, marked by economic stagnation and political disillusion, no longer holds unchallenged hegemony over world affairs. The rising South, exemplified by India, much to the West’s dismay, is slowly reshaping global norms toward Multipolar Equity and Equitable Interdependency. Through periphery theory, we see structural shifts of power; through neoliberalism, the exhaustion of Western economic paradigms; through realism, the pragmatic balancing of interests; and through dependency theory, the South’s quest to avoid subordination.

India, now stands firm at the intersection of these theories, is both a beneficiary and architect of the new world order. The Western hegemony will now witness the transfer of power to the East, and it will lead to the reconstitution of the neo-interdependency or Complex Interdependence international relations theory by Robert Keohane and Joseph Nye. In this theory, nations become deeply and mutually dependent through multiple channels, lacking a strict hierarchy of issues, and with military force being less prominent. The world is moving away from firm hierarchy, toward equity, away from dependency, toward partnership. The twenty-first-century world order, therefore, will not be defined by a single hegemon but by the plural agency where nations will not be penalised for their association with multiple blocs and the Global South, with India, will be its leading voice.

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Balaji Subramanian

_{Balaji is a freelance writer with an MA in History and Political science and has published articles on defence and strategic affairs and book reviews. He tweets @LaxmanShriram78. Views expressed are the author’s own.}