The Watchword in This VUCA World is ‘Security’

We are living in a disruptive decade, having witnessed a series of catastrophic events over the last six years. Starting with the COVID-19  pandemic in early 2020, followed by the Russia-Ukraine conflict since early 2022 and the Israel-Hamas conflict in 2024, the world has gone through multiple crises.

In early 2025, US President Donald Trump’s indiscriminate imposition of trade tariffs further skewered the global trade order. Sanctions, protectionism, resource nationalism, counter-tariffs, disruption of established supply chains, price volatility, and inflation became the norm. Geopolitical instability and geo-economic uncertainty have combined, and their lingering effects are still visible in global trade and international relations.

As if all this were not enough, we now have the US-Israel joint military action against Iran. Not just the Persian Gulf countries, but the entire world is facing collateral damage. The energy security of import-dependent countries is at risk. These successive events are set to exert a profound, and possibly lasting, effect on government policies and international relations.

Importantly, what was once rare is now normal. Geopolitical risks, for instance, are no longer exceptional. Several hotspots across continents remain vulnerable to stress. It may be naïve to assume that the world has seen the last of military conflict.

The global policy context is becoming increasingly complex. Governments often find themselves on the horns of a dilemma, needing to strike a balance between domestic socio-economic and political compulsions on the one hand, and international trade obligations on the other. More often than not, domestic compulsions prevail.

We live in a VUCA world characterised by volatility, uncertainty, complexity, and ambiguity. Navigating these conditions demands resilience.

Amid this, the word ‘security’, in all its dimensions, has assumed heightened importance. Countries and corporations are scrambling to achieve security on multiple fronts—energy security, food security, investment security, and, not least, military or national security.

Self-reliance and diversification have become the new mantras. Given the uneven distribution of natural resources across geographies, self-reliance often proves to be a chimera. As a result, countries and corporates are continually re-evaluating supply sources for imports and destination markets for exports. ‘Nearshoring’ or ‘friendshoring’ has become the new buzzword.

Dependence on a single supply source for imports or a single market for exports is giving way to the realisation that, over time, such dependence can turn into vulnerability.

Countries and corporates are learning agility—the capacity to remain nimble and flexible in the face of rapidly changing economic and market conditions. Equally important is resilience: the ability to manage men, money, and material over a long time horizon. Here, the role—and maturity—of governments and corporate leadership becomes critical.

Energy transition, sustainability, and technological infusion have become new-age imperatives. Navigating these choppy waters will require grit, foresight, and patience.