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New Delhi – India is at a pivotal moment as it seeks to integrate artificial intelligence into its economy and society, a drive underscored by a recent summit hosted by Prime Minister Narendra Modi. The convergence of India’s ambitions with the capabilities of US tech giants like OpenAI, Google and Anthropic is raising complex questions about technological dependence and national sovereignty, particularly as the nation anticipates a potentially transformative period coinciding with its 80th anniversary of independence in 2027.

Modi framed the potential of AI as a civilizational reset, comparing its impact to the discovery of fire. The AI Impact Summit in Delhi saw announcements of deals aimed at expanding access to AI tools like ChatGPT, Gemini, and Claude. However, this pursuit of technological advancement is unfolding against a backdrop of geopolitical competition, with the United States actively seeking to strengthen its technological ties with India as a counterweight to China’s influence.

The US government, viewing AI as central to its strategic competition with China, has been actively facilitating partnerships with Indian counterparts. A key element of this effort is the “Pax Silica” technology agreement, designed to foster closer collaboration between the US and India in the realm of technology and to steer India away from reliance on Chinese AI models. Jacob Helberg, the US under secretary of state for economic affairs, emphasized the perceived risks of relying on alternative AI sources, referencing a suspected Chinese cyberattack on Mumbai in 2020 – an incident where, according to Helberg, “we have seen the lights of a great Indian city extinguished by a keystroke.”

India’s reliance on external sources for essential components like semiconductors, power infrastructure, and data centers presents a significant challenge to its AI ambitions. The nation faces a critical choice between aligning with US or Chinese AI ecosystems, a decision with profound implications for its future economic and political trajectory. Stuart Russell, a professor of artificial intelligence at the University of California, Berkeley, suggests that if artificial general intelligence (AGI) is achieved, AI could come to dominate global economic output, potentially controlling as much as 80% of it.

The Pax Silica Agreement and US-India Tech Alignment

The Pax Silica agreement represents a strategic move by the US to solidify its technological partnership with India. US officials have characterized the agreement as an alliance between two democracies that have “broken centuries of colonial rule,” framing it as a collaborative effort to build a future based on shared values. Michael Kratsios, Donald Trump’s former science and technology advisor, argued that building on the “American AI stack” would provide India with a secure and independently controlled technological foundation. He stated, “Any country that builds on top of the American AI stack will have the most open, independently controlled, secured stack the world has to offer.”

Prime Minister Modi meets with OpenAI CEO Sam Altman at the India AI Impact Summit 2026.

Sovereignty Concerns and the Path Forward

Despite the allure of US technological partnership, concerns remain within India about potential digital dependence. Shri Krishnan, Modi’s tech secretary, acknowledged the demand to align with “like-minded countries” to avoid becoming “enslaved” by technological reliance. OpenAI’s head of global policy, Chris Lehane, attempted to assuage these concerns, stating that the company views India as a “strategic partner” rather than merely a customer. However, skepticism persists, with some observers, like Stuart Russell, suggesting that Silicon Valley companies may prioritize user engagement – potentially creating “AI addicts” – over genuine technological empowerment.

India is investing heavily in developing its own data center capacity and semiconductor manufacturing capabilities, but these efforts will take years to materialize. OpenAI CEO Sam Altman acknowledged the challenges facing Indian entrepreneurs attempting to compete in the foundational AI space, bluntly stating, “Look, the way this works is we’re going to tell you it’s totally hopeless to compete with us on training foundation and you shouldn’t even endeavor, and it’s your job to try anyway and I believe both of those things.”

As India navigates this complex landscape, it can leverage its position to demand adaptations of US AI models to its diverse linguistic and cultural context, and to establish robust safeguards. Joanna Shields, a former Facebook and Google executive, cautioned against the dangers of a “monoculture” based on a limited number of AI models, warning that it could erode cultural diversity. The path forward for India will require a delicate balance between embracing the opportunities presented by AI and safeguarding its own technological sovereignty.

The coming years will be critical as India attempts to harness the power of AI while mitigating the risks of technological dependence. The success of this endeavor will not only shape India’s economic future but too its position on the global stage. Further developments in India’s AI strategy, including specific policy decisions and investment plans, will be closely watched.

What are your thoughts on India’s AI strategy? Share your comments below.

Concerns are mounting among US senators regarding potential deregulation of the Federal Reserve, sparking debate over the central bank’s oversight and its impact on financial stability. The scrutiny comes as Federal Reserve Vice Chair Michelle Bowman engaged in discussions with Republican Congressman Dan Meuser of Pennsylvania, signaling increased congressional interest in the Fed’s regulatory approach.

The debate centers on the potential rollback of regulations implemented following the 2008 financial crisis. Senators are voicing apprehension that easing these rules could expose the financial system to undue risk, potentially leading to another economic downturn. This concern is particularly acute given the current economic climate, characterized by persistent inflation and uncertainty surrounding future growth. The core issue revolves around the balance between fostering economic activity and maintaining a robust regulatory framework to prevent systemic risk.

Congressional Scrutiny of the Federal Reserve

The increased attention from Congress follows a period of relative calm in financial markets, but lawmakers are wary of complacency. According to reports, senators are particularly focused on the potential for deregulation to impact smaller banks, arguing that these institutions may lack the resources to adequately manage increased risk. The discussion with Bowman, as reported by picture alliance, likely touched upon these concerns and the Fed’s perspective on the appropriate level of regulation.

The timing of this scrutiny is also significant. Federal Reserve officials recently opted to hold interest rates steady, a decision that has drawn criticism from some quarters who believe a more aggressive approach is needed to combat inflation. This decision, as noted in a Bloomberg report, has led to Powell being “headed for a congressional grilling.” The debate over deregulation adds another layer of complexity to the Fed’s already challenging task of navigating the economic landscape.

The specific regulations under review are not yet fully defined, but discussions are expected to focus on capital requirements, stress testing, and the Volcker Rule, which restricts banks from engaging in proprietary trading. These regulations were designed to prevent a repeat of the risky behavior that contributed to the 2008 financial crisis. Opponents of deregulation argue that weakening these safeguards could incentivize banks to take on excessive risk, potentially jeopardizing the stability of the financial system.

Geopolitical and Economic Context

The US financial system’s stability has global implications. As the world’s largest economy, any significant disruption in the US financial sector could have ripple effects across international markets. The debate over Fed deregulation is therefore being closely watched by policymakers and investors around the world. The US dollar’s status as the world’s reserve currency means that any changes in US monetary policy or financial regulation can have a significant impact on global trade and investment flows.

The current economic environment adds to the urgency of the debate. Global economic growth is slowing, and geopolitical tensions are rising, creating a climate of uncertainty. Some argue that deregulation could provide a much-needed boost to economic activity, whereas others contend that it would be a reckless gamble with potentially devastating consequences. The potential for increased risk-taking by financial institutions is a key concern, particularly as global economic conditions remain volatile.

What to Watch Next

The coming weeks are likely to spot increased scrutiny of the Federal Reserve’s regulatory policies. Congressional hearings are expected to be held, where Fed officials will be questioned about their approach to deregulation. The outcome of these debates will have significant implications for the future of the US financial system and the global economy. The focus will be on whether lawmakers can strike a balance between fostering economic growth and maintaining financial stability. Further discussions between the Fed and Congress, as well as ongoing economic data releases, will be crucial in shaping the debate and determining the path forward.

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WASHINGTON – Former President Donald Trump is expected to address the nation following today’s Supreme Court ruling that significantly limits presidential authority over trade policy. The Court determined that the power to impose sweeping global tariffs rests with Congress, not the executive branch. This decision represents a major setback for Trump, whose administration frequently utilized tariffs as a key economic tool, but doesn’t necessarily signal the complete of his trade agenda.

The ruling, delivered on Friday, February 20, 2026, upholds the constitutional principle of separation of powers, asserting that Congress holds the authority to regulate commerce with foreign nations. While the Court struck down the president’s ability to unilaterally levy broad tariffs, it did leave in place existing tariffs on specific goods from certain countries, potentially offering the administration a pathway to refine its approach. The core of the dispute centered on whether the president could impose tariffs for broad policy goals, or if such actions require congressional approval.

The decision echoes historical precedents, where presidents have been granted limited leeway to impose tariffs in specific circumstances. President Richard Nixon, in 1971, implemented a sweeping tariff on imports to address a currency crisis, but the tariffs were short-lived, lasting only four months. Similarly, in 2003, President George W. Bush imposed tariffs on steel imports, maintaining them for approximately nine months, as reported by the Congressional Research Service (LSB11292). Had Trump adhered to these more limited timelines, more of his tariffs may have withstood legal challenges.

Supreme Court Ruling: A Constitutional Check on Presidential Power

The Supreme Court’s decision stems from a case, Trump v. United States (case number 23-939), argued in July 2024 (23-939_e2pg.pdf). The Court found that the president’s authority to regulate international trade is not unlimited and that Congress retains the power to define the scope of such regulations. This ruling builds upon a series of recent Supreme Court decisions that have scrutinized the extent of presidential power, particularly under the “unitary executive” theory, as noted in a Washington Post opinion piece (Trump, Firing, and the Supreme Court).

The administration now faces the task of navigating a novel legal landscape. Experts suggest the ruling may prompt a shift towards more targeted tariffs, focusing on specific goods or industries, rather than broad, global levies. This approach would likely require collaboration with Congress, a potentially challenging prospect given the current political climate. The Los Angeles Lawyer Magazine reported in November 2025 that Congress has largely acquiesced to Trump’s policies, but this dynamic could change in light of the Court’s decision (The Unitary Presidency: Trump’s Second Term, the Supreme Court…).

Trump’s Longstanding Advocacy for Tariffs

Despite the legal setback, analysts believe Trump is unlikely to abandon his long-held belief in the effectiveness of tariffs. For decades, he has argued that an aggressive tariffs regime is essential for competing with economic rivals, particularly China. This stance predates his entry into politics and remains a core tenet of his economic philosophy. In November 2025, the Supreme Court deferred a decision on whether Trump could fire the head of the U.S. Copyright Office, highlighting a pattern of challenging established norms (Supreme Court defers decision on whether Trump can fire head of…).

The former president’s upcoming address is anticipated to address the Court’s ruling and outline his future plans regarding trade policy. While the specifics remain unclear, it is widely expected that he will reiterate his commitment to protecting American industries and securing favorable trade deals. The focus will be on how the administration intends to perform within the new constitutional constraints imposed by the Supreme Court.

The implications of this ruling extend beyond the immediate trade landscape. It raises fundamental questions about the balance of power between the executive and legislative branches and could have lasting effects on future presidential administrations. The Court’s decision underscores the importance of congressional oversight in shaping trade policy and reinforces the constitutional framework designed to prevent any single branch from wielding unchecked authority.

As the situation develops, further details regarding Trump’s address and the administration’s response are expected. This is a developing story, and we will continue to provide updates as they become available.

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