Explained : India’s silver coin diplomacy amid shifting global politics and Its Impact

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NEW DELHI: In the global crisis shaped by the ongoing conflict in West Asia, questions are being raised about how effectively India’s influence is asserting itself. The answer will become clearer only once conditions stabilise. However, it is worth recalling that in the 1950s, large Indian silver coins were widely circulated in parts of China. In that sense, while India may not yet retain the image of a “golden bird,” its credibility could well grow through a form of “silver coin diplomacy” in the years ahead—provided there is sustained political consensus on broader national and international interests despite democratic contestation.

Amid the Iran-Israel-United States tensions, sections of the opposition and sections of the media have repeatedly questioned why India does not openly support Iran or ideally align with the United States and Israel. A historical perspective offers clarity. During the tenure of former Prime Minister P. V. Narasimha Rao, India maintained strong ties with Iran while, in 1992–93, simultaneously permitting Israel to establish a full embassy in India with a resident ambassador. Around that time, interactions with Israeli diplomats in New Delhi reflected this shift.

Simultaneously, with the knowledge of the Rao government, Iran’s leadership invited a group of Indian editors, including Sriram Sharma, for a week-long visit, underscoring parallel engagement. Around the same period, Rao also travelled to Beijing in 1993 to sign a major agreement with China, reflecting a consistent policy of strategic balance.

Questions are now being raised about Prime Minister Narendra Modi’s relatively restrained public stance on the current geopolitical crisis. In this context, a remark attributed to Rao, recalled by diplomat Shyam Saran, is instructive: a successful leader must combine decisiveness with the calm of a sage. This philosophy underpins India’s approach—what may be described as a modern adaptation of non-alignment.

Historically, the Non-Aligned Movement often leaned toward the Soviet bloc. At the 1983 summit in New Delhi, figures such as Fidel Castro and Yasser Arafat held significant influence, while India navigated complex regional disputes involving Iran, Iraq and others. The tradition of balancing competing interests has thus deep roots.

In the present context, India continues to maintain ties with Iran, Israel, the United States, Russia, China and Europe, aiming to safeguard long-term economic and strategic interests.

Since independence, India’s foreign policy has rested on three pillars: non-alignment, anti-colonialism, and support for Arab nations and Palestine. This led to early and long-lasting efforts at maintaining close ties with Iran and the Arab world. India’s relationship with Iran spans centuries, shaped by Persian cultural influence, Sufi traditions and sustained trade, particularly in energy.

After the 1979 Iranian Revolution, India continued to maintain ties with Tehran despite its shift toward an anti-West posture. Post-1990, cooperation deepened further, including projects like the Chabahar port, which provides India access to Afghanistan bypassing Pakistan.

At the same time, India recognised Israel in 1950 but established full diplomatic relations only in 1992 under Rao. Since then, ties have expanded rapidly, particularly in defence, technology and agriculture. Israel has emerged as a key defence partner, supplying equipment and technology, including during conflicts such as Kargil in 1999.

Under Modi, relations have strengthened further, marked by his 2017 visit to Israel and expanded cooperation in areas such as defence, agriculture and artificial intelligence. Today, the relationship is often described as a strategic partnership.

India’s ability to maintain balanced ties with both Iran and Israel remains one of its most significant diplomatic achievements. This balance is essential for ensuring energy security through Iran, defence and technological collaboration with Israel, the welfare of Indian diaspora populations in West Asia, and a stable positioning in global geopolitics.

In the current crisis, India’s call for “restraint and dialogue” reflects this longstanding approach—one that prioritises strategic autonomy while navigating an increasingly complex international landscape.