Resilience is India’s new grand strategy

Brahma Chellaney, OPEN magazine

The US and Israel won the opening battles of the war they launched against Iran. They may yet lose the larger strategic contest. More significantly, the conflict continues to hold the global economy hostage. It has turned into an asymmetric war of attrition with mounting strategic, economic and geopolitical costs, with India one of the worst affected countries.

The war, now in its sixth month, has become a textbook example of how overwhelming military superiority does not necessarily translate into political success. Early strikes inflicted devastating damage on Iran’s military infrastructure and decapitated much of its senior leadership. Yet the Islamic Republic did not collapse. Instead, it adapted. Its leadership was rapidly reconstituted, its security apparatus remained intact, and it shifted to an asymmetric strategy that has imposed growing costs on the US and its regional allies.

Despite sustained strikes against Iranian assets, US President Donald Trump’s administration has failed to achieve one of its principal objectives: restoring secure commercial navigation through the Strait of Hormuz. Iran continues to wield its ability to disrupt one of the world’s most important energy chokepoints, keeping global energy markets under constant pressure and prolonging a worldwide economic shock. The war has destabilized the entire Persian Gulf region.

More fundamentally, the war has exposed a central flaw in the way Trump approached the conflict. No military campaign should begin without a clearly defined political end state, a realistic strategy for achieving it, an assessment of how the adversary is likely to respond, and measurable criteria for success. Absent these, tactical victories can accumulate without producing strategic gains. That increasingly appears to describe America’s campaign against Iran—“a bombing campaign in search of a strategy,” as Joe Kent, a former top US counterterrorism official, put it.

The conflict has also expanded well beyond a bilateral confrontation. Hezbollah, Iraqi militias, the Houthis and US-aligned Gulf states have all been drawn into the fighting at various stages. Repeated ceasefires have merely paused, rather than resolved, the violence, even as the financial, military and human costs continue to mount.

Trump’s war has revealed the limits of US power. Iran remains defiant, the Strait of Hormuz remains contested, and Washington’s objectives have become increasingly difficult to define. The longer the conflict continues without a coherent US political strategy, the greater the risk that Trump’s brazen military attack will be remembered not for its spectacular opening, but as a strategic liability that defined his second presidency.

Understanding how the world’s most powerful military arrived at this point—and what it means for American strategy, the Middle East, India and the global balance of power—is essential to understanding the conflict itself.

The war exposed India’s vulnerabilities

While the US risks turning military success into strategic failure, India risks becoming one of the Iran war’s biggest collateral casualties.

For more than two decades, India has carefully cultivated a policy of multi-alignment in the Middle East, maintaining close ties simultaneously with the US, Israel, the United Arab Emirates, Saudi Arabia and Iran. That balancing act has served India remarkably well, securing energy supplies, protecting its large diaspora, expanding trade and opening new strategic partnerships.

A prolonged US-Iran conflict, however, threatens to unravel this equilibrium.

India’s greatest vulnerability is energy. More than 80 per cent of its crude oil is imported, with roughly half originating in or transiting the Persian Gulf. Even more critically, most of India’s imported Liquefied Natural Gas (LNG) and Liquefied Petroleum Gas (LPG) also pass through the Strait of Hormuz.

As long as Iran retains the ability to threaten this maritime chokepoint, India remains exposed to higher energy prices, imported inflation, a widening current account deficit and greater fiscal pressure. Every sustained increase in oil prices ripples through the Indian economy—from transport costs and manufacturing to household cooking fuel and fertilizer production.

The costs do not end there. Higher war-risk insurance premiums and disruptions across the Gulf and Red Sea have sharply increased freight costs, eroding the competitiveness of Indian exports to Europe and North America.

At the same time, the conflict threatens the livelihoods of about nine million Indians living and working in the Gulf. Any large-scale escalation could force New Delhi to undertake a massive evacuation while further reducing remittances that sustain millions of households across states such as Kerala, Tamil Nadu and Bihar.

The strategic consequences may prove even more enduring. The war strikes at the heart of India’s long-term connectivity ambitions.

Iran’s Chabahar Port—in which India invested heavily to obtain direct access to Afghanistan and Central Asia while bypassing Pakistan and offering a counterweight to China’s Gwadar Port—has been crippled by renewed American sanctions, US airstrikes and the reluctance of private shipping, insurance and logistics firms to operate there. Chabahar is a crucial feeder port for the broader International North-South Transport Corridor (INSTC) connecting Mumbai to Moscow. The Iran war has effectively frozen development on missing rail links and dry-run corridors.

Consequently, Afghanistan and the landlocked Central Asian states have been pushed back toward reliance on Pakistani routes or Chinese Belt and Road Initiative (BRI) infrastructure, undermining India’s regional influence.

Simultaneously, the India-Middle East-Europe Economic Corridor (IMEC), unveiled with great fanfare at the G20 summit in 2023 in New Delhi as a flagship alternative to China’s BRI, has effectively been frozen. Aimed at connecting India to Europe via a sea-and-rail network passing through the UAE, Saudi Arabia, Jordan and Israel, IMEC’s viability depends upon a stable Middle East and continued Arab-Israeli normalization—two assumptions that the war has shattered.

The result is more than the temporary suspension of three infrastructure projects. Together, Chabahar, INSTC and IMEC formed the key pillars of India’s westward strategic outreach, intended to integrate the country more deeply with Central Asia, the Persian Gulf and Europe while reducing dependence on vulnerable maritime routes. Their suspension narrows India’s geopolitical options just as China is expanding its economic and diplomatic footprint across West Asia.

Trump’s Iran war, illustrating how he has turned America’s unrivalled power into an instrument of unilateral coercion, is imposing mounting costs on India. The conflict threatens India’s energy security, strains its economic resilience, endangers millions of overseas citizens and undermines years of painstaking geopolitical investment. Indeed, the conflict has imposed a broad inflationary tax on the Indian economy.

In a war fought far from its borders, India may emerge as one of its principal strategic losers.

India’s new energy realism

The Iran war is forcing India to rethink not merely where it buys its energy, but the very foundations of its energy security strategy.

For decades, India’s overriding concern was ensuring that sufficient energy supplies reached its shores at affordable prices. That objective has become considerably more complicated.

The prolonged disruption of Persian Gulf supplies has demonstrated that energy security can no longer be measured simply in barrels purchased or contracts signed. It now encompasses the resilience of maritime supply routes, the political reliability of suppliers, the financial infrastructure through which payments are made, and the strategic leverage that accompanies dependence on any single power.

New Delhi’s response has therefore evolved into a multi-layered strategy designed to reduce vulnerability without sacrificing strategic autonomy.

The first line of defence is physical resilience. India has significantly strengthened its Strategic Petroleum Reserve (SPR), maintained by Indian Strategic Petroleum Reserves Limited. Underground caverns at Visakhapatnam, Mangaluru and Padur provide an emergency buffer against sudden oil-supply disruptions, while commercial inventories maintained by public-sector refiners substantially extend national cover. The government is also expanding storage capacity at Chandikhol and Padur under Phase II of the SPR program.

These reserves cannot insulate India indefinitely from a prolonged conflict, but they buy policymakers precious time during the opening stages of a supply shock, reducing the likelihood of panic buying or abrupt economic disruption.

Natural gas presents a much greater challenge. Unlike crude oil, liquefied natural gas cannot easily be stockpiled for extended periods. India’s LNG storage infrastructure was designed for operational efficiency rather than strategic resilience, leaving the country with only a limited emergency cushion.

Because a majority of India’s imported LNG originates in the Gulf and transits the Strait of Hormuz, any prolonged disruption immediately exposes the country to shortages. The government has consequently begun encouraging additional cryogenic storage capacity while developing protocols for emergency allocation of scarce supplies. In a severe crisis, household cooking gas, city gas distribution and fertilizer production receive priority, while industrial users, power stations and energy-intensive manufacturers are required to curtail consumption or switch to alternative fuels.

The second pillar of India’s strategy is diversification. Russia’s invasion of Ukraine transformed India’s crude procurement strategy, as refiners took advantage of discounted Russian oil. Although Washington subsequently pressured New Delhi to reduce those purchases, the outbreak of the Iran war demonstrated the strategic value of maintaining multiple suppliers. Russian crude has provided an important economic hedge against volatility in Middle Eastern markets.

At the same time, India expanded purchases from Brazil, Guyana, Nigeria, Angola, Venezuela and the US, reducing the danger that instability in any single producing region could paralyze its economy.

Diversification, however, is not simply about geography. Different crude grades possess different refining characteristics. Indian refineries have spent decades optimizing operations around heavier Middle Eastern and Russian grades. Maintaining a balanced crude basket, therefore, improves both energy security and refinery efficiency, reducing dependence on any one supplier while preserving operational flexibility.

Diversifying suppliers does not eliminate another critical vulnerability: geography. Oil purchased from widely separated producers still converges upon a limited number of maritime chokepoints. The Strait of Hormuz, Bab el-Mandeb and the Red Sea remain indispensable arteries for global commerce. Even when cargoes are rerouted around the Cape of Good Hope to avoid conflict zones, transit times lengthen, freight costs increase and insurance premiums soar.

Recognizing this reality, India has quietly expanded the role of its navy. Through Operation Sankalp, Indian warships now provide escorts for merchant vessels, conduct maritime surveillance across the Arabian Sea and Gulf of Aden, and protect sea lines of communication vital to India’s economy. Importantly, New Delhi has deliberately maintained these operations under independent national command rather than integrating them into U.S.-led naval coalitions.

That distinction is more than symbolic. American-led maritime coalitions pursue broader geopolitical objectives, including deterrence and, when necessary, offensive strikes against hostile launch sites. India’s mission is fundamentally different. Operation Sankalp is narrowly focused on protecting Indian shipping, preserving freedom of navigation for India’s own commerce and avoiding entanglement in regional conflicts. By remaining outside formal coalition structures, New Delhi retains complete freedom to determine when, where and how its forces operate while continuing to exchange maritime information with international partners.

This approach preserves India’s longstanding policy of strategic autonomy while minimizing the risk that it will be perceived by Arab states or Iran as an active participant in the conflict.

Yet the most consequential debate in New Delhi concerns not naval deployments or strategic reserves, but the changing composition of India’s energy imports.

As American sanctions on Russia intensified and Washington pressed India to diversify away from both Russian and Iranian supplies, the US has emerged since May as India’s largest supplier of LNG and LPG. Furthermore, India, nudged by Washington, has become the largest export destination for Venezuelan oil, payments for which flow to the US Treasury rather than Caracas. The arrangement increasingly resembles a colonial relationship, with Washington controlling Venezuela’s principal source of national income.

The US-origin or US-controlled energy supplies to India undoubtedly enhance diversification, but they also introduce major vulnerabilities. More importantly, replacing one dependency with another carries its own strategic risks.

Europe offers a cautionary example. Following Russia’s invasion of Ukraine, European governments rapidly reduced their dependence on cheap Russian pipeline gas by dramatically increasing imports of American LNG. While this strengthened energy security in one respect, it also exposed Europe to higher transportation and liquefaction costs, volatile US pricing and growing political dependence upon decisions made in Washington. Energy relationships that appear commercially attractive during one geopolitical crisis can become strategic liabilities during the next.

Indian policymakers are keenly aware of this lesson. Dependence upon US-origin or US-controlled energy sources exposes India to risks extending well beyond ordinary market fluctuations. American energy exports remain subject to executive authority and domestic political priorities. Export licenses can be modified, delayed or conditioned in response to changing geopolitical circumstances. Even more significant is Washington’s demonstrated willingness to employ sanctions, financial regulations and the dollar-based international payments system as instruments of statecraft.

India experienced this first-hand as Washington repeatedly targeted Russian energy exports with sanctions. Although China remained Russia’s largest energy customer and Europe continued purchasing significant quantities, Washington focused its pressure largely on India to curtail imports and shift toward alternative suppliers, especially the US. The broader message was unmistakable: access to energy could become contingent upon alignment with American foreign policy objectives.

Such dependence sits uneasily alongside India’s longstanding commitment to strategic autonomy. For decades, successive Indian governments have sought to avoid excessive dependence upon any single great power. That principle applies as much to energy as it does to defence or diplomacy. Heavy reliance upon US-origin or US-controlled energy supplies could gradually reduce New Delhi’s diplomatic flexibility toward Russia, Iran and other non-Western partners, complicating its ability to pursue an independent foreign policy.

There are also commercial considerations. American LNG generally carries higher transportation and liquefaction costs than supplies from the Gulf, while US crude differs significantly from the heavier grades for which many Indian refineries were designed. Processing large quantities of lighter American crude requires operational adjustments that can reduce the production of diesel and other middle distillates essential to India’s transport economy.

Such import dependence introduces another layer of vulnerability. American energy transactions are denominated in US dollars, reinforcing dependence upon American financial infrastructure precisely when India has sought to diversify payment mechanisms. New Delhi’s growing interest in local-currency settlement reflects not ideological opposition to the dollar but a desire for redundancy.

The successful Rupee-Dirham framework with the UAE demonstrates how local-currency arrangements can reduce exposure to external financial shocks while facilitating bilateral trade. By contrast, the Rupee-Rouble mechanism revealed the practical difficulties created by large trade imbalances and India’s partially convertible currency. The rupee is fully convertible on the current account (for trade, services and remittances), but it has partial and restricted convertibility on the capital account to prevent sudden massive capital flight during global financial crises and to protect the currency from extreme speculative attacks by foreign entities.

The lesson is not that de-dollarization is imminent, but that financial diversification is becoming an essential component of energy security.

Ultimately, India is attempting to avoid exchanging one structural dependency for another.

Its long-term strategy, therefore, extends beyond diversification toward reducing hydrocarbon dependence altogether.

Electrification of transport, accelerated adoption of electric vehicles, nationwide railway electrification, expanded ethanol blending, compressed biogas, green hydrogen for fertilizer and steel production, large-scale renewable energy deployment, grid-scale storage and expanded nuclear generation all serve a common strategic objective: reducing India’s exposure to external energy coercion.

The same logic underpins India’s search for overseas equity oil, investments in critical minerals, and efforts to develop domestic manufacturing across emerging clean-energy supply chains.

Energy security in the twenty-first century is no longer measured solely by oil wells and tanker routes. It increasingly depends upon batteries, transmission networks, hydrogen technologies, nuclear reactors and secure access to lithium, cobalt, nickel and rare earth elements.

The Iran war has accelerated this transformation. It has demonstrated that energy dependence is not simply an economic vulnerability but a geopolitical one.

For India, the lesson is clear: strategic autonomy ultimately requires energy autonomy. Complete self-sufficiency may remain unattainable for a rapidly growing major economy, but reducing dependence on any single supplier, transport corridor or financial system has become a national security imperative. The conflict has therefore reinforced a doctrine likely to shape Indian strategy for decades to come—one that seeks resilience through diversification today while pursuing genuine energy independence tomorrow.

India’s strategic awakening

The Iran war is set to leave a lasting imprint on India’s strategic thinking long after the guns fall silent.

It represents a critical defining moment, just like the 1991 Indian financial crisis, which was driven by a rapid depletion of foreign exchange reserves and external shocks like the US-led Gulf War and which compelled India to pledge gold to the International Monetary Fund (IMF) and abandon the “license raj” for market liberalization.

Wars often force changes to help plug vulnerabilities. The current conflict in the Persian Gulf has done precisely that for India. It has exposed vulnerabilities that many Indian policymakers understood in theory but had never experienced on such a scale: the fragility of maritime energy lifelines, the limits of multi-alignment during great-power confrontation, the vulnerability of ambitious connectivity projects to geopolitical shocks, and the revolutionary impact of low-cost autonomous weapons on modern warfare.

The most important lesson concerns energy itself. For decades, Indian policymakers viewed energy security largely through the lens of supplier diversification. The assumption was straightforward: purchasing oil from a wider range of countries would reduce strategic vulnerability.

The Iran war has exposed the limitations of that approach. Diversifying suppliers does little if much of the country’s oil and gas imports must still pass through vulnerable maritime chokepoints. A tanker carrying American, Russian or Gulf crude offers little comfort if it cannot safely transit the Strait of Hormuz.

The lesson is that energy security is no longer simply about suppliers. It is about resilience. That requires larger strategic reserves—not only for crude oil but also for natural gas—greater redundancy in shipping routes, stronger naval protection for sea lines of communication, and a faster transition toward domestically produced energy.

India’s long-term energy strategy is, therefore, becoming inseparable from its national security strategy.

The conflict has also exposed the hard limits of multi-alignment. India has spent the past two decades cultivating close relationships simultaneously with Washington, Riyadh, Abu Dhabi, Tel Aviv and Tehran. That strategy worked because those relationships could largely be compartmentalized. The Iran war demonstrates what happens when those compartments collapse.

The US and Israel expect partners to tighten sanctions and isolate Tehran. Iran expects countries benefiting from access to Chabahar and the Strait of Hormuz to remain politically neutral. Gulf monarchies are simultaneously deepening ties with Asia while hedging between Washington and Beijing. In such an environment, maintaining cordial relations with all sides becomes progressively more difficult.

This does not mean India’s policy of strategic autonomy has failed. On the contrary, it makes strategic autonomy even more valuable. But autonomy will increasingly require active diplomacy rather than passive balancing. India can no longer assume that staying equidistant from competing blocs will automatically protect its interests. It will have to become more proactive in crisis diplomacy, regional mediation and coalition-building while preserving freedom of action.

The war also delivers a sobering verdict on infrastructure strategy.

The suspension of the IMEC and INSTC corridors illustrate how quickly geopolitical assumptions can collapse. Multinational corridors crossing politically unstable regions may appear commercially attractive during peacetime but can become financially and strategically untenable almost overnight.

Future connectivity strategies will thus likely place greater emphasis on redundancy rather than efficiency alone. Direct maritime access, diversified shipping routes, protected port investments and multiple transport corridors are likely to receive greater priority than ambitious but politically fragile mega-projects.

Perhaps nowhere are the lessons more striking than on the battlefield. Like the war in Ukraine, the Iran conflict demonstrates that the economics of warfare are changing. Militaries can no longer afford to intercept $20,000 drones with multi-million-dollar missiles. Drone swarms, loitering munitions, precision missiles and electronic warfare increasingly allow relatively inexpensive systems to impose disproportionate costs on technologically superior adversaries.

For India, this is not an argument against acquiring sophisticated aircraft such as the French Rafale. High-end fighters remain indispensable for establishing air superiority, conducting deep precision strikes and deterring peer competitors such as China. But the conflict demonstrates that quality alone is insufficient.

The future lies in integrating crewed aircraft with large numbers of inexpensive autonomous systems capable of saturating enemy air defences, conducting reconnaissance and absorbing attrition before high-value platforms enter contested airspace.

India’s emerging Combat Air Teaming System (CATS), indigenous stealth drones and loyal-wingman concepts point in precisely this direction. Equally important will be mass-producing low-cost interceptors, directed-energy weapons and electronic warfare systems capable of defeating drone swarms without exhausting expensive missile inventories.

The central challenge is no longer simply technological sophistication. It is achieving technological sophistication at industrial scale.

The conflict also exposes another dimension of national resilience that has often received insufficient attention: India’s overseas citizens.

About nine million Indians live and work across the Gulf. Previous crises allowed New Delhi to organize limited evacuation operations. A prolonged regional war would present an entirely different challenge. Airspace closures, damaged infrastructure and maritime disruptions could make evacuating millions of people impossible. Protecting the diaspora therefore requires a shift from emergency evacuation toward pre-crisis planning, civil-defence cooperation with Gulf sheikhdoms, resilient communications networks and stronger domestic mechanisms for absorbing returning workers without severe economic and social disruption.

Taken together, these lessons point toward a broader transformation.

The Iran war demonstrates that twenty-first-century national security can no longer be compartmentalized into separate military, economic, technological and diplomatic domains. Energy policy affects foreign policy. Financial infrastructure influences strategic autonomy. Maritime security shapes economic resilience. Industrial capacity determines military effectiveness. Critical technologies increasingly matter as much as traditional weapons systems.

For India, strategic autonomy is thus acquiring a new meaning. It is no longer simply the freedom to avoid choosing sides in great-power competition. Increasingly, it is the ability to withstand external coercion regardless of where it originates—whether through disrupted energy supplies, sanctions, financial pressure, supply-chain shocks or military intimidation.

The broader significance of the Iran war lies precisely here. The conflict, by exposing India’s vulnerabilities, has helped clarify its strategic priorities. Building larger energy reserves, diversifying supply chains, strengthening maritime power, accelerating indigenous defence production, investing in new military technologies and reducing structural dependence on imported hydrocarbons are no longer separate policy initiatives. They are becoming components of a single national strategy.

The war may ultimately be remembered not only for reshaping the Middle East but also for accelerating India’s evolution from a country managing external crises to one systematically preparing for an era in which geopolitical disruption is no longer the exception but the norm.

The Iran war marks more than a turning point for India or any other important state. It marks the emergence of a new strategic era in which resilience has become the defining currency of national strength. Countries that can secure their energy, protect their supply chains, manufacture critical technologies and withstand economic coercion will enjoy far greater strategic freedom than those that remain dependent on vulnerable external systems.

India has begun to absorb that lesson. Whether it can translate it into policy may prove one of the defining strategic questions of the coming decade.

Trump’s show of force has triggered the deepest global disruption in decades

Brahma Chellaney

Nikkei Asia

The U.S.-Israeli war on Iran lasted just 40 days. Its consequences will last years.

What ended with a fragile ceasefire on April 8 has already become the most economically disruptive war in half a century. Not since the oil shocks of the 1970s has a conflict simultaneously ruptured energy supply, disrupted trade arteries, strained food systems and tightened global financial conditions.

What distinguishes this war is not just its scale, but its breadth: It hit multiple pillars of the global economy at once, and in ways that cannot be quickly reversed.

U.S. President Donald Trump returned to office promising to end “stupid wars.” Instead, he delivered one of the most strategically self-defeating conflicts. While U.S. and Israeli forces degraded Iran’s military capabilities, the war revealed a harsher truth: Overwhelming force cannot compel favorable outcomes against a resilient adversary capable of imposing systemic costs by widening the battlefield beyond its borders. The result was power without resolution.

Like the 1956 Suez Crisis that exposed the limits of British power, this war has prompted a growing question: Did Trump just engineer America’s own Suez moment?

What began on Feb. 28 as a military campaign quickly metastasized into the largest energy-supply disruption in history. Energy infrastructure across Iran and the Gulf was damaged or disabled. Supply routes fractured. And most critically, the Strait of Hormuz became effectively unusable.

Unlike past crises, there was no workaround. Oil and gas output fell sharply. Shipping insurance premiums in the Gulf surged more than fourfold.

Even after the ceasefire, a permanent risk premium has been embedded into global energy markets, as investors and shippers now assume that instability in the Gulf is no longer episodic but enduring.

In effect, Trump became the first leader in modern history to trigger a global energy crisis through direct military action.

For Asia, particularly India, Japan and South Korea, the shock has been severe. Along with China, these economies depended heavily on Gulf energy flows. But while Beijing has accelerated its pivot toward overland pipelines from Russia and Central Asia, Tokyo, Seoul and New Delhi remain structurally exposed, with no viable alternative to vulnerable sea lanes.

Because energy underpins every stage of modern production, the global shock does not stop at fuel. It is already cascading into the world food system.

Modern agriculture runs on energy. Natural gas is essential for fertilizer production; oil powers irrigation, transport and mechanization. When energy systems fracture, food systems follow.

The Gulf is a key supplier of fertilizers such as urea and ammonia. Disruptions sent prices soaring, just as the Northern Hemisphere entered its spring planting season. Reduced fertilizer use is now locked in for the 2026 harvest.

The consequences are unfolding in stages: first an input shock, then a production shortfall, and finally a consumption crisis marked by rising food prices.

By next year, analysts expect significant increases in the cost of grains, vegetable oils and meat. Corn — central to global feed systems — is particularly vulnerable, raising the prospect of a “protein shock.”

A sign displayed at a Thai gas station announces that diesel fuel has run out. Photo: AP

Government responses are compounding the problem. High oil prices have made biofuels more attractive, prompting countries to divert more crops into fuel production. The result is a self-reinforcing cycle: Higher energy prices tighten food supply, pushing prices even higher.

The war also exposed a rarely acknowledged vulnerability: the Gulf’s heavy dependence on desalination.

After a desalination facility on Iran’s Qeshm island was struck, reprisal attacks on desalination plants in Bahrain, Qatar and the UAE triggered a cascading water-energy crisis. Desalination facilities are highly energy-intensive and indispensable. Damaging them forced governments to divert enormous resources simply to maintain potable water supplies.

In the world’s most freshwater-scarce region, water itself became a weapon of war.

While the war-triggered crisis is global, its burden is not.

In advanced economies, the crisis manifests as inflation and industrial strain. Households face higher costs, while central banks delay rate cuts. But these countries retain buffers.

The Global South does not. Many developing economies rely heavily on imported energy, particularly from the Gulf. Rising prices have ballooned import bills, weakened currencies and increased debt burdens, especially where liabilities are dollar-denominated.

Capital is flowing out of these economies into perceived safe havens, tightening financial conditions further. The result is a vicious cycle: higher costs, weaker currencies and shrinking fiscal space. For some countries, the risks are existential.

Compounding the crisis is a sharp drop in remittances. Millions of workers from developing countries are employed in Gulf economies. War-related disruptions have reduced remittance flows significantly. At the household level, families are losing financial lifelines just as food and energy prices surge. At the national level, governments are losing critical foreign exchange, undermining their ability to stabilize economies.

Globally, what makes this moment especially dangerous is not any single disruption, but their convergence.

Energy systems are fractured. Food systems are under strain. Financial flows are shifting. Trade routes are costlier and more uncertain. The Strait of Hormuz, once a reliable artery of global commerce, is now a contested chokepoint, with lasting implications for how energy moves and power is exercised.

The era of cheap energy, secure transit and frictionless globalization is giving way to something more fragmented, more politicized and more volatile. Even if the ceasefire holds, this will not quickly reverse.

Damaged energy infrastructure will take several years to rebuild. Confidence in Gulf transit has been eroded to the extent that the costs — in terms of prices, insurance and strategy — are now locked into the system.

The irony is stark. A war intended to assert American supremacy has instead imposed global costs that the world will continue to bear even after Trump leaves office.

Global growth will likely remain constrained. Energy markets will stay tight. Food systems will absorb delayed shocks. And U.S. credibility will continue to erode.

The war’s true legacy is not the 40 days it lasted but the systemic crisis it set in motion. And that bill is only beginning to come due.

Brahma Chellaney, a professor of strategic studies at the independent New Delhi-based Centre for Policy Research and fellow at the Robert Bosch Academy in Berlin, is the author of nine books, including “Water: Asia’s New Battleground,” which won the Bernard Schwartz Book Award.

Brahma Chellaney, Special to The Globe and Mail

The U.S.-Israeli war on Iran crossed a dangerous threshold that few have yet fully grasped. It was not just one more Middle Eastern conflict defined by missiles, drones, bunker-busting bombs and cyberwarfare. It marked the normalization of something far more insidious: the deliberate targeting of water facilities.

Water itself became a weapon of war in a region already defined by extreme scarcity of the world’s most vital resource. 

This weaponization was not incidental: it was deliberate, reciprocal and escalating, with implications far beyond the Persian Gulf.

The Middle East is the most water-stressed region in the world, with over 80 per cent of its population living under conditions of extreme scarcity.

Within this region, the Persian Gulf stands out for its acute water scarcity, with per capita renewable freshwater availability falling well below the “absolute” scarcity threshold of 500 cubic meters per year in most countries. Contrast that with between 80,000 and 100,000 cubic meters per capita availability in Canada, which, along with Brazil and Russia, ranks among the richest in freshwater resources. 

The Gulf Arab countries and Iran’s coastal areas and islands rely heavily on desalination rather than renewable internal water resources, which are less than 100 cubic meters per capita in all the Gulf sheikhdoms other than Oman. 

In such an environment, water infrastructure is not just civilian; it is existential.

What the war revealed was a profound transformation in how such infrastructure is perceived. Desalination plants, water treatment systems and electrical grids that sustain them were no longer treated as protected civilian assets; they became targets.

Early in the conflict, damage to desalination facilities in Kuwait and the UAE was dismissed as collateral — an unfortunate byproduct of strikes on nearby military installations. That illusion did not last. Within days, the logic of retaliation took hold.

On March 7, a desalination plant on Iran’s Qeshm Island was struck, cutting off water to dozens of villages. The very next day, an Iranian drone targeted a desalination facility in Bahrain, disrupting supply to civilian areas.

A taboo had been broken. Water-for-water retaliation had entered the battlefield.

The anatomy of vulnerability

Nowhere is such escalation more dangerous than in the energy-rich Gulf Arab nations. These petro-states are, more precisely, “saltwater kingdoms,” surviving by converting seawater into potable water through desalination.

Yet this highly energy-intensive technological solution, long seen as a triumph of engineering over geography, revealed itself as a strategic weakness in wartime because of the plants’ vulnerability to attack.

In some Gulf states, up to 90 per cent of drinking water comes from desalination. These supplies are produced by a small number of massive, highly visible coastal facilities that are nearly impossible to fully defend. 

Most states maintain only three to seven days of potable water reserves, although some are now working to expand them. A successful strike on a major plant could leave millions without water in less than a week.

In other words, modern Gulf cities — from Dubaito Doha toRiyadh — are never more than a few days away from a total water blackout.

Iran, for its part, faces a different but equally severe water crisis. It is not dependent on desalination to the same degree, but population and economic growth and resource mismanagement have pushed it into virtual “water bankruptcy,” with consumption exceeding natural replenishment. Aquifers have been depleted, rivers diminished and ecosystems like Lake Urmia nearly disappeared.

Even before recent U.S. and Israeli airstrikes on critical infrastructure compounded these pressures, Iran’s president Masoud Pezeshkian had proposed relocating the capital to a wetter area, warning that Tehran’s deepening water crisis could render the city “uninhabitable.”

The infrastructure asymmetry between the Gulf states and Iran creates a volatile dynamic. The Gulf states are technologically resilient but physically exposed. Iran is structurally fragile but less vulnerable to single-point infrastructural collapse.

War turned these vulnerabilities into targets.

What distinguished this conflict was not simply that water infrastructure was hit, but that it was targeted as part of a deliberate strategy.

The logic is straightforward: modern societies depend on tightly integrated systems — electricity powers water infrastructure, and water sustains public health, industry, agriculture and social stability. Disrupt one node, and the entire system begins to unravel.

The U.S. understands this well. During the 1991 Gulf War, it systematically destroyed Iraq’s electrical grid, disabling water purification systems. The consequences were catastrophic: contaminated water supplies, collapsing hospitals, surging waterborne diseases and rising child mortality.

A subsequent study analyzing declassified U.S. Defense Intelligence Agency (DIA) documents concluded that the destruction of electricity and water-treatment infrastructure effectively functioned as a “biological weapon in slow motion.” One cited DIA document, “Iraq’s Water Treatment Vulnerabilities,” detailed how sanctions combined with electrical-grid destruction would produce “incidences, if not epidemics, of disease.”

In the Iran war, that logic — using electricity and water systems as instruments against civilian populations — was being reapplied.

Threats by U.S. President Donald Trump to destroy Iran’s electricity and desalination plants and broader energy infrastructure underscored how deeply that approach was embedded in thinking. Iran’s response was to mirror that logic in its own retaliatory approach.

Civilian lifelines were recast as instruments of coercion. The result was an emerging doctrine of “hydro-warfare,” one that threatened to intensify an already acute regional water crisis.

There was also an “invisible front” in this hydro-warfare: cyberattacks.

The war began with one of the largest cyberattacks in history, disrupting Iran’s digital infrastructure and crippling the automated systems that manage water distribution. A prolonged near-total internet blackout followed. In response, Iranian-linked cyber groups targeted industrial control systems associated with water and wastewater facilities across the region.

Such attacks aimed not to destroy infrastructure physically, but to manipulate its “digital brain” — to disrupt flow, degrade supply or trigger system-wide failures.

Unlike conventional strikes, cyber operations offer deniability and scalability. They blur the line between war and sabotage, making attribution difficult and escalation harder to control.

But their effects are no less real. A malfunctioning water system can be as devastating as a bombed one.

The collapse of legal restraints

International humanitarian law is unequivocal. The Geneva Conventions, reinforced by Additional Protocol I, explicitly prohibit attacks on objects indispensable to civilian survival — water facilities foremost among them.

Yet the Iran war suggests that these norms are rapidly eroding. Mr. Trump, while mocking international law, threatened to return Iran to the Stone Age and destroy a “whole civilization.”

Each side accused the other of initiating the escalation. Each strike was framed as retaliation. Each violation became justification for the next.

This is how norms collapse, not through formal repudiation, but through gradual normalization.

Had this trajectory continued, the consequences would have extended far beyond this war. The targeting of water infrastructure risked becoming an accepted instrument of statecraft — a precedent waiting to be replicated elsewhere.

In a warming world where water scarcity is intensifying, that is a profoundly destabilizing prospect.

The humanitarian and environmental consequences of hydro-warfare are stark.

Water scarcity unleashes cascading impacts. Hospitals are among the first to fail. Sanitation systems collapse, increasing the risk of disease outbreaks. Industrial sectors, from petrochemicals to data centers, grind to a halt, amplifying economic disruption.

The environmental risks are no less grave. Damage to desalination plants can release toxic chemicals into the Persian Gulf, while disruptions to brine discharge systems can create localized ecological “dead zones.” In a narrow, semi-enclosed body of water already under stress, such contamination could have long-term consequences for marine life — and for the seawater on which desalination depends.

Hydro-warfare also carries profound political implications. In the Gulf monarchies, state legitimacy rests on an implicit social contract: political acquiescence in exchange for stability and provision. Water is central to that bargain. If governments cannot guarantee basic supply — even under the umbrella of U.S. security protection — that contract begins to fray.

Iran appeared acutely aware of this dynamic. By targeting Gulf infrastructure, it sought not only to retaliate against U.S. and Israeli actions, but to drive a wedge between Gulf Arab states, which all host American military bases, and their Western patrons.

In short, the weaponization of water is self-destructive, even for those who imagine they gain short‑term leverage. It degrades the shared ecological foundation on which all communities depend.

Normalizing the unthinkable

What made the Iran war particularly dangerous was the convergence of three forces: deepening water stress, technological dependence and geopolitical confrontation.

Rising temperatures and erratic rainfall are intensifying water scarcity across the Middle East. At the same time, technological solutions like desalination have created new forms of dependency — systems that are efficient, even if costly, but fragile, centralized and exposed. War exploits that fragility.

The Iran conflict demonstrated how quickly these systems can be weaponized — and how difficult they are to restore once broken.

The targeting of water infrastructure marks a profound shift in warfare, extending conflict from the battlefield into the biological core of civilian life. What is at stake is not just the legality of certain tactics, but the survival of a foundational principle: that even in war, some things remain off-limits. That principle is no longer under strain; it is being dismantled.

If water can be weaponized with impunity, the distinction between combatant and civilian collapses. War ceases to be a contest between militaries and becomes an assault on the conditions of life itself.

TheUnited States and Israel may see these tactics as instruments of coercion, and Iran as tools of deterrence and retaliation. But all sides have participated in a dangerous experiment whose consequences will outlast the war.

The Middle East has long been a region defined by the politics of oil. It may now be entering an era shaped by the geopolitics of water. And unlike oil, water has no substitute. It is irreplaceable.

Brahma Chellaney is the author of two award-winning books on water: Water: Asia’s New Battleground and Water, Peace, and War: Confronting the Global Water Crisis.

By Brahma Chellaney, The Hill

When President Trump launched his war on Iran, attention fixed on missiles, drones and the risks of escalation. The real story lay elsewhere: a grandiose and ultimately reckless vision of American “energy dominance” that helped propel Washington into war.

This was not simply a security decision, but an economic and ideological gamble rooted in Trump’s long-held belief that U.S. control over international energy flows would translate into global geopolitical supremacy and arrest America’s relative decline.

In his second term, that belief hardened into doctrine. But in Iran, it collided with reality.

For years, Trump has openly flirted with the idea that the U.S. should “take” or otherwise control the oil resources of states too weak to impose retaliatory costs. That impulse, once dismissed as rhetorical excess, became operational policy under the banner of “energy dominance” — maximize U.S. and allied fossil-fuel output and then wield global supply and pricing as a strategic weapon against adversaries and even friendly states.

By last year, the U.S. had indeed become the world’s largest oil and gas producer, flooding global markets with shale output and liquefied natural gas. This surge created a dangerous illusion in Washington — that America had insulated itself from the geopolitical risks of energy disruption. If the U.S. no longer depended on Middle Eastern oil, the thinking went, it could act militarily in the Persian Gulf without suffering serious economic consequences at home.

That misperception proved decisive. Trump’s advisers argued that any Iranian retaliation — whether through attacks on Gulf infrastructure or disruption of shipping in the Strait of Hormuz — could be offset by U.S. and allied production. Last June’s limited U.S. strikes on Iran had triggered only temporary price spikes, reinforcing the belief that markets could be managed.

Energy dominance, in this reading, was not just an economic strategy; it was a license for geopolitical coercion.

It removed a constraint that had shaped decades of U.S. policy. Where previous presidents hesitated — fearing that war with Iran would send oil prices soaring and damage the global economy — Trump saw an opportunity. If supply could be controlled, then conflict could be contained.

But this logic rested on a profound miscalculation that energy systems are linear, predictable and ultimately subordinate to American power. They are not.

Once the conflict escalated and the Strait of Hormuz was effectively compromised, the consequences rippled far beyond what Washington had anticipated. Prices surged, volatility spiked and the shock spread through every layer of the global economy.

Energy is not just another commodity. It is the foundation of modern economic life. When energy prices rise sharply, food prices follow. Natural gas is essential for fertilizer production, while oil powers agricultural machinery, irrigation and transport. The result is a cascading effect: an energy shock becomes a food shock and, for many societies, a political shock, hitting the most vulnerable countries hardest.

This is the real legacy of Trump’s war: not battlefield outcomes, but systemic disruption.

The energy logic that helped drive the conflict was never confined to Iran. Just eight weeks earlier, the Trump administration had demonstrated its willingness to operationalize resource control in Venezuela, where U.S. military intervention resulted in the capture of President Nicolas Maduro and the installation of a more pliable regime. Vice President JD Vance was explicit about the rationale: control over one of the world’s largest oil reserves.

Iran represented the same logic, scaled up.

Together, Iran and Venezuela account for almost one-third of global proven oil reserves.

The prospect of bringing both into Washington’s strategic orbit would amount to an unprecedented lever over global energy markets, allowing the U.S. not just to influence prices, but to shape the economic trajectories of rivals and partners alike. It is difficult to overstate how radical this vision was.

It marked a return to a resource-centric foreign policy reminiscent of earlier eras, when access to oil routinely drove foreign intervention, regime change and covert operations — from the 1953 CIA-assisted coup in Iran to Cold War-era resource conflicts. The difference today is the scale of ambition: not merely securing supply, but globally dominating it.

Dominance, however, has proven illusory. Far from demonstrating control, the Iran war has exposed the fragility of the global energy system — and the limits of American power within it. With markets interconnected, geopolitical shocks cannot be neatly contained. And even a country as energy-rich as the U.S. remains deeply vulnerable to global systemic shocks.

The irony is stark. A strategy designed to give Washington greater freedom of action has instead produced global constraint — slowing growth, fueling inflation and amplifying financial instability across continents.

If anything, the Iran war underscored the opposite of what its architects intended: that energy interdependence remains a structural reality, not a vulnerability that can be engineered away.

In the end, Trump’s pursuit of energy dominance did not merely enable the war on Iran; it made it conceivable for the first time. By convincing itself that the economic risks of conflict could be managed, the administration crossed a threshold earlier leaders had resisted. What followed was not the calibrated use of American power, but an unleashing of forces far beyond Washington’s control.

The costs mounted swiftly, at home and abroad. The bill was global — paid for one man’s delusion.

Brahma Chellaney is the author of nine books, including the award-winning “Water: Asia’s New Battleground.”