Context:

• Along with a threat to the ecosystem, the melting of Arctic ice is opening the Northern Sea Route (NSR) and creating fresh prospects in the area.
• U.S. pressures and climate change are causing global trade to evolve; nations are looking at new supply networks and paths. Though it warns of a global catastrophe, the Arctic presents great geopolitical and economic promise.
• India wants to make sure it has a part in future Arctic prospects without damaging the delicate ecology as new trade routes develop.

The Northern Sea Route (NSR) Running along Russia's northern coast, the Northern Sea Route (NSR) is a recently established Arctic sea path linking the Atlantic to the Pacific Ocean.It offers the quickest marine path between Europe and Asia, therefore drastically cutting shipping distances.  For example, shipping from Rotterdam to Shanghai via the NSR cuts the trip by about thirty percent, therefore shortening travel time by almost ten days.

Impact of the Northern Sea Route (NSR) on Global Trade

Reduced Freight Costs

• The NSR presents a shorter, more direct path that can significantly cut shipping expenses. By spending less time on the water, vessels help to minimize running expenses and fuel usage.
• For instance, the shortened journey time and fuel consumption could force multinational shipping firms—especially for bulk products and high-value cargo—to change their operations to the NSR.

Expedited Global Trade

• The NSR has the potential to drastically speed up global trade, especially for time-sensitive cargo such as electronics, automotive parts, and perishable goods.
• Example: In 2018, a Chinese cargo ship successfully completed a voyage through the NSR, delivering goods from China to Europe in 18 days, as compared to the 40+ days it would take via the Suez Canal.

Opening New Markets

• New Arctic ports and shipping routes may be easier to establish with the help of the NSR. As a result, underdeveloped economies in the Arctic region may find new avenues for economic growth.
• For instance, ports like Russia's Murmansk and the Arctic's Pevek are poised to expand and become major maritime centers, opening up new markets.

Changing Dynamics of Global Trade

• Multiple factors, particularly climate change, are prompting a realignment in the global trade landscape. Trade strategies are being shaped by the Arctic, which has evolved from a remote frontier into a pivotal player in environmental and geopolitical discussions.
• Consequently, governments are seeking new economic channels and alliances beyond their traditional regional blocs. The opening of the NSR and the changing environment are reshaping the flow of global commerce.

The Geopolitical and Economic Importance of the Arctic Region for India

Climate Change and the Arctic's Significance

• The Arctic region is widely acknowledged as an indicator of global climate change. Since 1981, Arctic sea ice has diminished by 12.2% per decade, a clear indication of global warming.
• This ecological transition signifies environmental turmoil while also creating new economic prospects, especially in shipping and resource extraction.

The Northern Sea Route (NSR): A Geopolitical Game-Changer

As a result of its considerable length along the coastline of the Russian Arctic, the Northern Sea Route (NSR), which is a significant new commercial corridor connecting Europe and Asia, is attracting a lot of attention. The NSR provides a reduced path, which reduces the amount of time needed for shipping as well as the costs of goods. This results in significant economic benefits for nations that are active in global trade.

• Increased Shipping Volumes: From just 41,000 tonnes in 2010, cargo transit along the NSR surged to approximately 37.9 million tonnes by 2024.
• Potential for India: With long-term plans for building Arctic-ready infrastructure including ice-class ships and mega ports, India's strategic interests in the NSR are extending as a rising economic power.
• India’s Budget for Maritime Development: India has recognized the importance of the Arctic and has earmarked $3 billion in its 2025-26 Budget for the development of maritime infrastructure, including the shipbuilding capacity necessary for Arctic navigation.

Arctic Natural Resources: Energy Security and Economic Potential

Oil and natural gas are among the many undeveloped resources found in the Arctic. The United States Geological Survey estimates that it contains thirty percent of the world's natural gas and thirteen percent of its undiscovered oil. As the ice caps melt due to climate change, these resources will be easier to acquire, increasing rivalry among world powers to exploit them.

• Due to its increasing energy demands, India has the opportunity to access new energy sources in the Arctic, which would help ensure its energy security.
• India can obtain long-term energy contracts with Arctic nations, reducing its dependence on traditional energy sources and ensuring energy security in the face of escalating global demand.

Geopolitical Influence and Maritime Security

Geopolitical influence in India's favor may rise if the nation were to become more involved in the Arctic administration. The Arctic Council is an institution that supports scientific cooperation and environmental conservation; India is a member of it as an observer state.

Russia, the United States of America, and members of the European Union are all Arctic powers, and India's diplomatic ties with these countries can be strengthened through active engagement in Arctic administration.

• Strengthening Strategic Alliances: India can improve its geopolitical positioning and build ties with key global players through strategic engagement in Arctic affairs.
• Maritime Security: Strategic interaction with the Arctic area by India will also improve maritime security, therefore guaranteeing protection of vital world commerce routes. This is absolutely important as, in global trade, the NSR grows ever more important.

Arctic Governance and Legal Framework

Two international treaties that serve as a framework for Arctic governance are the Arctic Council and UNCLOS. Despite its focus on environmental protection, the Arctic Council is mainly an international forum consisting of eight member nations.

Contrarily, a legal process for resolving conflicts is provided by UNCLOS, which deals with marine boundaries and resource rights. Climate change and indigenous peoples' rights are two major issues that UNCLOS fails to address, despite their continued importance in the region.

• This geopolitical complex in the Arctic is exemplified by the Svalbard Treaty, which gives Norway sovereignty over the Svalbard archipelago but permits other countries to utilize its resources.
• India stands to gain strategically from its involvement in the Arctic, as it will enhance its standing in global legal frameworks and give it more say in regional decisions.

India’s Strategic Role in Arctic Geopolitics

Russia – A Key Partner

• India sees Russia as a crucial ally in the Arctic, primarily due to Russia's expansive Arctic coastline and established infrastructure.
• Bilateral cooperation has led to initiatives like the Chennai-Vladivostok Maritime Corridor, designed to link Indian and Russian trade routes.
• The partnership is vital for India's aim to develop alternate trade corridors, including the Northern Sea Route (NSR).

China’s Ambitions

• The Polar Silk Road is an expansion of China's Belt and Road Initiative. It aims to circumvent old chokepoints such as the Malacca Strait for economic and transportation purposes.
• If India were to identify itself with Russia, it might unwittingly align itself with China's polar ambitions, which would complicate India's strategic objectives. This is especially true when considering the tight relationship that exists between India and China.

Western Bloc – A Delicate Balance

• Aligning too closely with Western nations, especially the United States, could alienate Russia and limit access to Arctic resources.

India’s Potential Partners

Japan, South Korea, and Russia are all important allies. Concerned about China's growing influence in the Arctic, they all agree that a more inclusive Arctic Council is necessary to ensure equitable access to the region's resources.

India’s Arctic Engagement

The interaction of India with the Arctic is not a phenomenon that has evolved in the recent past. The genesis of this phenomenon may be traced back to the signing of the Svalbard Treaty in 1920, which was the moment that marked the commencement of the country's participation in the region. The Arctic strategy of the Indian government has evolved over the course of several years, with substantial strategic, scientific, and geopolitical objectives acting as the primary motivating factors for its activities.

Strategic Importance of the Arctic for India

Northern Sea Route (NSR):

• As a result of the NSR's ability to bridge the gap between the two seas, it is now much simpler to conduct business between Asia and Europe.
• India's ambitions for its economy are bolstered by its interest in the NSR, which is in accordance with its long-term objectives of enhancing maritime trade and reducing the costs of goods.

Geopolitical Leverage:

• India has been a member of the Arctic Council as an observer since 2013, giving it a prominent place in talks about regional governance and resource sharing.
• In the process of extracting resources from the Arctic, it seeks to promote sustainable methods and fair development.

India’s Arctic Policy

Early Involvement:

• India's first Arctic involvement via the Svalbard Treaty prepared the ground for more diplomatic and scientific activity.
• India reached a major turning point in its Arctic presence in 2008 when it built its research station Himadri in Svalbard, Norway.

Scientific Contributions:

• Indian studies have concentrated on how the loss of Arctic ice affects local events such as monsoons and agricultural output.
• Research on Arctic glacial dynamics, marine biodiversity, and climate trends under direction of the National Centre for Polar and Ocean Research (NCPOR)

India’s Arctic Policy (2022)

India's Arctic Policy, which was unveiled in 2022, lays out the country's plans for long-term development and scientific cooperation in the Arctic.  

• Among the most important things to do is to increase diplomatic representation in the Arctic Council and other governance bodies.
• Fostering international relationships and technical progress.

Arctic Circle India Forum (2025):

In May of 2025, during the Arctic Circle India Forum, India will have a once in a lifetime chance to bring its Arctic policy in line with regional and international priorities. The nomination of a "Polar Ambassador" is another possible outcome.

Challenges and Concerns

• The Arctic is one of the most vulnerable ecosystems, and additional activity may exacerbate climate change effects.
• Nature Climate Change reported that global temperatures exceeded the 1.5°C threshold above pre-industrial levels in 2024, indicating a possible long-term divergence from the Paris Agreement's goals.
• India must balance its business interests and its commitment to global sustainability.
• To navigate Arctic waters, specialised ice-breaking fleets and polar-ready ships are required.
• The Union Budget 2025-26 set aside $3 billion for maritime development, including Arctic-specific shipbuilding expenditures.
• UNCLOS allows nations to extend their claims to the seabed beyond the 200-nautical-mile EEZ if they can demonstrate that the area is a natural extension of their continental shelf.
• Russia, Canada, and Denmark (via Greenland) have all filed claims to expand their seabed sovereignty under the UN Convention on the Law of the Sea.
• The United States, which has not ratified UNCLOS, faces limitations in exercising its claims. Meanwhile, Russia has utilized legal maneuvers and strategic military positions to strengthen its claims and challenge Western interests.

Way Forward for India in the Arctic Region

International Cooperation

• India should participate in multilateral negotiations emphasising knowledge transfer, training, and capacity building. Cooperation on these fronts will enable India increase its impact in Arctic governance.

Balancing Commercial and Environmental Interests

• India must strike a balance between seeking commercial advantage and safeguarding the fragile Arctic ecosystem. While expanding trade and commercial ventures, India must ensure that these efforts do not undermine the Paris Agreement goals.
• The exploration of Arctic resources should be called for in a way that is both sustainable and responsible. Through its participation in international rules, India has the ability to guarantee that commercial activities in the Arctic do not result in the damage of the environment.

Strategic Partnerships and Geopolitical Alignment

• India should align with like-minded nations, including Japan and South Korea, to advance its geopolitical and environmental interests. These nations share concerns about China-Russia cooperation in the Arctic and have mutual economic and strategic goals.
• A dual engagement strategy with both the U.S. and Russia can maximize India’s strategic and economic interests, while also maintaining geopolitical neutrality in Arctic affairs.

Maritime Connectivity and Regional Integration

• The Chennai–Vladivostok Maritime Corridor has the potential to connect Indian ports to the Northern Sea Route (NSR) ports like Pevek, Tiksi, and Sabetta. This maritime link would facilitate trade and strategic cooperation between India, Russia, and other Arctic nations.

Reforming the Arctic Council

• Along with Japan and South Korea, India should advocate change inside the Arctic Council to produce a more inclusive and fair governance structure. This would guarantee Arctic policy's more democratic and open approach of making decisions.

Advocacy for Sustainable Development

• India has to support global rules on climate-resilient policies and environmentally friendly development methods in order to advocate sustainable resource management in the Arctic.  
• Through its involvement in international venues such as the Arctic Council and stressing the preservation of the environment alongside economic development, India can affect world Arctic governance.

Conclusion

India's Arctic involvement has to strike a mix between strategic alliances, commercial aspirations, and environmental obligations. Essential is a neutral but constructive attitude with both Western and Russian blocs. 

Practice Question How can India strategically balance its economic ambitions and environmental responsibilities while exploring its potential in the Arctic region?