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The world of business today, feels like it is balancing on a tightrope. Geopolitical shifts are not just occasional tremors—they are shaking things up daily. From protective policies to shifting trade routes, we are watching globalisation give way to a growing focus on regional connections, rewriting the rules as we know them.
Tariffs are making a comeback, supply chains are being redrawn to prioritise national interests, and the predictability of multilateral agreements is giving way to a more transactional reality.
For Indian businesses with global ambitions, this is unfamiliar terrain. The sheer pace of change has turned risk into a strategic variable. But amidst the noise, there is also opportunity — for those willing to recalibrate, localise, and lead with foresight.
The New Normal: Tariff-Led Uncertainty
KPMG International’s report titled “Top geopolitical risks 2025 paints a clear picture: uncertainty is not an exception anymore—it is the new baseline. The numbers speak volumes—over 3,400 trade interventions worldwide in 2024. Today we are witnessing trade wars escalating between major players, rising tariffs disrupting traditional paths, regulations diverging across regions, and technology being treated as a matter of national security. Add supply chain stresses and workforce transformations, and you get a world that is barely recognisable.
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This new reality is forcing organisations to rethink global strategies and local operations. India Inc. must now manage risks linked not just to where they operate — but how globally exposed their operations are. For businesses, long-term planning now requires sharper scenario modelling, better geopolitical intelligence, and cross-functional alignment between strategy, finance, compliance and operations.
India’s Position: At the Crossroads of Global Realignment
In light of the above scenario, there is a unique opportunity here for Indian businesses to play a central role in this new economic order. As Western economies look to reduce dependence on any single region, India’s appeal as a diversified, democratic, and digitally driven market is on the rise.Middle powers — including India — are becoming new economic nodes. We are no longer just market participants; we are shapers of global norms in areas like digital governance, climate finance, and even manufacturing resilience. But this comes with responsibility. Indian firms expanding globally must be prepared to navigate fragmented tax regimes, digital services levies, and conflicting compliance requirements.
Tariffs, Tech, and Talent: A Three-Front Challenge
In addition to tariffs, two other undercurrents are shaping business risks: the politicisation of technology and the transformation of the workforce. As AI regulation fragments across regions, companies need to be wary of data privacy obligations, IP risks, and cybersecurity vulnerabilities. Many are now clustering their tech operations based on geopolitical alignment — a trend that may reshape global IT architecture.
Simultaneously, demographic shifts, reskilling needs, and immigration challenges are putting talent strategies under pressure. Here again, risk teams must step up — to ensure businesses are not just protecting value, but creating it through resilient, future-ready operating models.
Looking Ahead: From Risk Response to Resilience
The days of predictable global growth are behind us. Those that succeed will be the ones who embed geopolitical awareness into their very DNA—leveraging local insights, adaptive strategies, and a clear-eyed view of the global landscape.
For Indian businesses, this moment demands more than agility. It demands maturity — to look beyond the headlines, to recognise emerging fault lines before they widen, and to adapt business models for a world where the rules are being rewritten.
Boards and leadership teams will need to reassess assumptions, stay alert to regulatory and policy shifts, and act swiftly on signals from across regions. This also means building internal structures — whether through scenario planning or integrated risk frameworks — that enable faster, informed decision-making.
In a time of noise, the role of risk is to bring clarity. And clarity, as always, is the first step toward resilience — not just to withstand change, but to shape it.
The writer is Office Managing Partner – Mumbai and Head of Risk Advisory, KPMG in India.
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