TECHNO-CAPITALISM IN INTERNATIONAL RELATION: MEANING, CHALLENGES AND WAY FORWARD

Techno-capitalism, where tech and data drive global power, offers India opportunities via DPI and startups. But challenges like digital divides and AI job impacts persist. India's strategic autonomy, tech diplomacy, and self-reliance are key. This approach boosts 'Make in India', transforming crisis into opportunity for 'Atmanirbhar Bharat'.

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Context

Trump’s approach to technology and its intersection with capitalism, dubbed “techno-capitalism,” and the increasing influence of a "tech broligarchy" – a powerful alliance between tech giants and government – presents a complex challenge for India.

What is Techno-Capitalism?

It defines an economic system where technological innovation, vast data collection, and powerful digital platforms are central to stocking wealth, stimulating economic growth, and wielding global power.

Key Elements:

  • Tech Giants Dominance: Companies like Google, Amazon, and China's BAT (Baidu, Alibaba, Tencent) have economic power and data power.   
  • Data as "New Oil": Data collection, analysis, and monetization drive business models and provide strategic advantages.
  • Innovation as Power Currency: Advancements in AI, quantum computing, and semiconductors dictate national competitiveness and global reputation.  

Techno-Capitalism Global Models

American Model (Catalyst, not Controller): The US tech transformed; private firms like SpaceX now conduct more annual launches than NASA.

  • America’s dynamic tech sector accelerated innovation, offering the US a strategic edge.
  • The US government acts as a catalyst, especially in defense procurement and standard-setting.

Chinese Model (Centralized, Mission-Driven): Since Deng Xiaoping’s "scientific modernization" call (late 1970s), the Chinese state pursued a centralized advancement model.

  • Decades of double-digit growth, industrialisation, and heavy investment brought China to the top of global tech power in AI and space.
  • China’s civilian space program now competes with the US and is expanding globally through initiatives like the Digital and Space Silk Roads.

India’s Intermediate Trajectory: Remains between the American and Chinese models.

  • Recent reforms introduced dynamism into the space sector.
  • However, India still needs to fully mobilize its private sector for a larger global space economy share.
  • Requires reform in higher education and scientific research establishments.

SITE (1975) and "Scientific Internationalism"

  • The Satellite Instructional Television Experiment (SITE) launched in 1975, collaboration between ISRO and NASA.
  • The experiment represented a "scientific internationalism" for the US.
    • SITE used the American ATS-6 satellite to expand educational programs to over 2,400 villages in six underdeveloped Indian states.
    • It ended in 1976.
  • In 2023, Critical and Emerging Technologies (ICET), a collaborative framework established by the US and India to enhance cooperation in technology.
    • ICET's survival faces uncertainty due to bilateral differences on Russia, trade, and Pakistan.
  • A structural challenge lies in the divergent trajectories of Indian and American technology ecosystems.

Trump's "Post-Liberal" Techno-Capitalism

USA as an "enthusiastic enabler" of big technology, not a regulator

AI Policy: Trump's 2025 AI policy prioritizes dismantling regulatory barriers, building data infrastructure, promoting AI-led manufacturing, and mobilizing funds in public and private investment.

Financial Innovation (Cryptocurrency): The "GENIUS Act" breaks from cautious crypto approaches.

  • It creates a framework for dollar-backed stablecoins, requiring 1:1 backing by liquid US assets (cash, short-term treasuries).
  • The Act mandates reserve disclosures and consumer protections for mainstream stablecoin adoption.
  • It aims to back the US dollar’s reserve currency role and counter "de-dollarisation" (e.g., from BRICS nations).

The Trump administration rejects a central bank digital currency, rather setting a Strategic Bitcoin Reserve and ending prosecutions of major crypto firms.

A new "state-capital compact" or "tech broligarchy" is forming between Silicon Valley elites and Washington, driven by strategic advantage, with the potential to influence global trade, finance, and security through planned AI investment.

Impact on Global Order

Shifts in Economic Power: Digital economy growth redefines national wealth and influence.

New Forms of Influence: Control over digital platforms grants leverage over information and commerce.

Data Governance as Geopolitical Issue: Nation competition to control over data flows and privacy, recognize data as a strategic asset.

Opportunities for India

Digital Public Infrastructure (DPI): India's DPI (Aadhaar, UPI, DigiLocker) offers a unique model for inclusive digital transformation.  

Startup Ecosystem: Third-largest startup ecosystem globally, facilitating innovation and attracting FDI. In 2022-23, India attracted over $9.4 billion FDI in computer hardware and software.

IT Services and Software Exports: Global leader in IT and business process outsourcing, generating foreign exchange.  

Talent Pool: India has a vast pool of skilled engineers and tech professionals, advantage in the global tech race.

Digital Transformation: Technology drives efficiency in governance (e.g., Ayushman Bharat Digital Mission), healthcare, education, and agriculture.

Challenges for India

Digital Divide: About 45% of the population, or about 665 million people, do not have access to the internet, deepening inequalities; rural broadband penetration lags urban areas.

Data Privacy and Security: Protecting citizen data from misuse and breaches remains a major challenge.

Foreign Tech Dominance: India depends on foreign technology and platforms, raising concerns about data sovereignty and strategic autonomy (e.g., dependence on foreign semiconductor supply chains).

Cyber Security Threats: Techno-capitalism brings increased vulnerability to cyberattacks, ransomware, and state-sponsored espionage.  

Regulatory Hurdles: Regulating powerful global tech giants poses complex challenges related to anti-trust, content moderation, and taxation.  

AI Ethics and Governance: Developing ethical AI frameworks and ensuring responsible use of emerging technologies is important to prevent misuse and biases.

Vulnerabilities in IT Sector: AI automation threatens many services, making traditional jobs obsolete.

Immigration Hostility: Growing restrictions toward H-1B visas. Western techno-nationalism and hostility to immigration.

India's Strategic Responses  

Digital Sovereignty and Self-Reliance: "Make in India" and "Atmanirbhar Bharat" in electronics and semiconductors, to establish a robust ecosystem.

  • Restrictions on certain foreign apps (e.g., TikTok ban in 2020) and telecommunications equipment (e.g., Huawei).

Tech Diplomacy and Alliances: Engage in critical and emerging technology (CET) dialogues with partners like the US (iCET initiative), focusing on AI, quantum, and semiconductors.

  • Participates in global tech governance discussions in forums like the G20, advocating for equitable access and common standards.
  • Promotes diversification of global supply chains, especially in critical minerals and semiconductors, working with trade partners, and Quad.

Data Governance and Cyber Security Cooperation: India advocates for responsible data governance frameworks, emphasizing data localization for sensitive data.

  • Collaborates with international partners to share threat intelligence and enhance cyber resilience.

Conclusion

Techno-capitalism impacts international relations, presenting both opportunities and complex challenges for India. India's strategic autonomy, driven by its digital public infrastructure and active tech diplomacy, are crucial to navigate the challenge and make the crisis an opportunity to boost Make in India to become Atmanirbhar Bharat

For Prelims: CRYPTOCURRENCY l BLOCKCHAIN l BASICS OF ARTIFICIAL INTELLIGENCE

For Mains: Artificial Intelligence (AI) in Military Operations l Science and Technology l Technology & Innovation

Source: INDIAN EXPRESS 

PRACTICE QUESTION

Q. "Technological dependencies can be a more potent tool of coercion than military force." Critically analyze. 250 words

Frequently Asked Questions (FAQs)

Techno-capitalism is an economic system where technology and innovation are the primary drivers of capital accumulation, with large tech corporations holding immense power.

Data localization is a policy that requires data about a country's citizens to be stored and processed within its own geographical borders.

Digital diplomacy is the use of internet platforms and digital tools by governments to conduct foreign policy and achieve diplomatic goals.

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