The breakup of the Soviet Union in 1991 was a game-changer for India, shaking up its economy, defence strategy, and foreign relations.
For years, the USSR had been India’s largest trading partner, pumping in vital support through the rupee-ruble trade agreement.
This wasn’t just any partnership—the Soviet Union helped India build industries like steel, oil, and coal, and set up big enterprises like ONGC and BHEL.
By 1991, trade between the two nations hit a solid $5 billion a year.
But then, December 25, 1991, arrived, and the Soviet Union collapsed.
Trade with Russia and former Soviet states dropped by over 60%, creating a huge gap in India’s economy.
The end of the rupee-ruble trade forced India to use hard currency for imports.
In fact, things got so bad that India had to pledge 67 tons of gold to the IMF to secure a loan.
It was a wake-up call that Soviet-style socialism wasn’t working anymore.
That’s when India’s policymakers launched significant economic reforms in 1991.
The reforms opened India to foreign investment, reduced government control, and launched economic liberalisation.
The defence sector, reliant on the USSR for over 70% of its hardware, was hit hard as the supply chain was cut off.
India had to rethink its defence strategy quickly, diversifying its military imports while continuing to rely on Russia.
But with the Soviet Union gone, India built stronger ties with the US and Western nations, while maintaining relations with Russia. This gave India flexibility in a multipolar world, engaging with global forums like BRICS, SCO, and the G20.
While the USSR’s collapse seemed like a disaster at first, it actually pushed India to evolve—fast.
It led to the reforms and new partnerships that have fueled India’s growth and success.
In this episode of The NEON Show, a former diplomat with a 36-year career in the Indian Foreign Service, Rajiv Sikri examines India’s complex ties with neighbouring countries exploring issues like Kashmir, economic interdependence, and political dynamics. He also sheds light on the impact of global powers, especially the US and China, on India’s strategic choices.
Check out Rajiv Sikri’s book Strategic Conundrums: Reshaping India’s Foreign Policy:
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00:00 – Trailer
02:27 – Host Siddharth Ahluwalia introduces The Neon Show
03:10 – Pakistan, Bangladesh, Afghanistan
07:33 – Pakistan’s ties with the West, China, and the military’s role
11:07 – Kashmir conflict and India-Pakistan relations
14:33 – Pakistan’s internal political dynamics
17:51 – Bangladesh’s identity and India relations
20:27 – India-Bangladesh economic interdependence
28:33 – India’s strategic geographic position
32:19 – India’s foreign policy after the Berlin Wall’s fall
36:07 – Economic impacts and India-US relations
40:19 – US-Russia relations and the Ukraine conflict
44:39 – Russia-Ukraine war’s effect on India
50:43 – US dominance and unilateral actions post-1989
54:31 – Challenges to US hegemony
58:27 – India-US relations amidst strategic concerns
1:03:47 – BRICS and global multipolarity
1:07:07 – Dollar dependency and US financial power
1:10:47 – Concluding thoughts on India’s foreign policy
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Hi, I am your host Siddhartha! I have been an entrepreneur from 2012-2017 building two products AddoDoc and Babygogo. After selling my company to SHEROES, I and my partner Nansi decided to start up again. But we felt unequipped in our skillset in 2018 to build a large company. We had known 0-1 journeys from our startups but lacked the experience of building 1-10 journeys.
Hence was born The Neon Show (Earlier 100x Entrepreneur) to learn from founders and investors, the mindset to scale yourself and your company. This quest still keeps us excited even after 5 years and doing 200+ episodes.
We welcome you to our journey to understand what goes behind building a super successful company. Every episode is done with a very selfish motive, that I and Nansi should come out as a better entrepreneur and professional after absorbing the learnings.
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This video is for informational purposes only. The views expressed are those of the individuals quoted and do not constitute professional advice.
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Very enlightening podcast.
for the consumption of the Indians otherwise not at all creditable
its indo – pacific
There are only four nations (W4) of relevance in the Premier league – US, China, Russia, and Bharat. The urgency to continue the economic development should our premier objectiv first and foremost.
The gentleman knows foreign affairs not agriculture. Indian agriculture is on the brink of collapse because of ceiling on land holding act , black land laws And hindoo succession act amendment 2005. . No wonder modi uncle came with his 3 agriculture laws to corporatize indian agriculture :- the dream of ghe old masters since 1857.
The only one that is radical is India Itself! ALL EYES ON INDIAN MINORITIES!
Has India’s strategic shift from reliance on the USSR to embracing the US and Russia left it vulnerable to being caught in the crossfire of global power struggles?
😢😢😢
India and Modi biggest blunder is enslaving India to collapsing American empire! It is shameful after building RIC to BRIC to BRICS India chose enslave to America and Israel!
American economic and military hegemony is coming to an end.
Great Analysis,Sir, Thanks Sid. 2
I'm not Pakistanis or Indian. You both countries like cat and mice.
India should focus its neighbors to achieve peace and blessings.
It has a handful of problems within India.
Pakistan too, it should take available helps from China to improve its economy and build the current situation.
indians and their obsession with Pakistan 😂😂😂.
A very enlightened Indian. His conclusion that there's a great deal of internal division based on language & religion. Modi must accept India is a diverse country & his idea of homogenized India is a dream.
A nation whose leader says “our people will eat grass but we want to have nuclear weapons so that we can use against India” will forever be a failed and a poor state. A country of clowns called Pakistan
In short there is a lot of corruption in pakistan and everyone in power thinks only of their own purse.
Bangladeshis want to reduce rest of the Hindu population, Pakistan already wiped of Hindus there, while in India, muslims are increasing more than majority Hindus(muslims are growing at much faster rate) , not sure where this is going, does future of India belongs to muslims?
Indinpurnobersbolcksires
Alotpesntmanepurbolck
Mr Sikri is saying that we have to tag along with the US in a subservient state to become some kind of 'Super Power'. The US is dying. Joining with a dying State will hardly make us a Super Power!
Indingornmantwareslose
Indinpurlose
Indinmanepurrad
Indinmanepurbolck
Indincincimlongano
Indingoramantwarscincimnoborepurbolck
I think Indian foreign policy is a failure. He has no friend in the neighborhood.
This is the first podcast I saw from your channel after going thru multiple YT shorts, it was worth it! you're very respectful and sensible in what you're doing! Good luck, Jai Hind
Same old crap from India. All your neighbors are “bad”. He never mentions indian fundamentalism. More of the same garbage
All muslim countries should Boycott India 🇮🇳⛔ and Israel🇮🇱⛔.
ইন্ডিয়া বাংলাদেশের শত্রু এটা বুঝতে পারাই আমাদের সার্থকতা। – নুরুল কবির
😂😂😂😂
Just another Modi guy.
US AND CHINA BOTH ARE SAME..
I bow my head to Shri Sikri.
This collar-and-tie pseudo-scholar with bogus credentials is repeating its bloviating rhetoric, that is, terrorism associated with Pakistan when in fact the Hindu Rashtra (India) and its hindutva hordes with their piercing tridents for terrorism, for example, Ajith Doval, etc are facing international summons and indictments in North America for gruesomely murdering foreign citizens of Indian origins. Hindu democracy is fraud and so is its pretentious peacefulness which is full of conflicting conflagrations and confrontational pogroms of vulnerable non-Hindu minorities, such as Muslims, Sikhs, and even the low-caste Hindu Dalits that have been explicitly exposed before the international community.
Linking indias economy with islamic bangladesh was such a brilliant move 😂. Now india will enjoy the benefits of this super brilliant move. After all bongladesh us such a friendly country.
WHO DIVIDED THE ORIGINAL COLONIAL INDIA ??? THE UK . DIVIDE AND RULE WAS THE POLICY ,BUT IT NEVER WORKS AND LATER ON USE THE ISSUE TO KEEP THE ISSUE ALIVE AND CAUSE WARS. I THINK INDIA AND PAKISTAN SHOULD PUT THEIR DIFFERENCES AND UNITE AND THEN YOU HAVE A SUPER POWER BORN ♥
Ended on such a hypocritical note, on one hand you want Chinese to uprise & oppose their Govenrment but you want Indians to not critize its own establishment.
I am sorry but disappointed to hear your views.