South Asia Journal
Extreme heat has presented another real-world test. Since May, many parts of India have experienced extreme heat, causing a surge in residential cooling demand and disrupting manufacturing, IT parks, and urban life. India’s peak electricity demand reached 270.73 gigawatts at one point, exceeding the government’s previous estimates, and power outages occurred in some areas. In Chennai, nighttime blackouts lasted between 40 minutes and one hour, and the government urged residents to conserve electricity. This has exposed shortcomings in India’s grid peak-shaving capabilities, coal transportation, energy storage, and urban infrastructure. On the other hand, however, India has managed to maintain basic operations in most regions despite such intense pressure on electricity consumption and has swiftly directed coal companies to increase supplies to power plants. This indicates that the Modi government is pursuing a pragmatic balance between energy transition and ensuring practical energy security.
Meanwhile, U.S. tariff pressures are testing India’s resilience in external negotiations. On June 5, Indian Commerce Minister Piyush Goyal stated that the first phase of the U.S.-India bilateral trade agreement is expected to be finalized by mid-July. The U.S. has raised the possibility of imposing an additional 12.5% tariff on Indian imports over alleged forced labor issues. This indicates that while India faces real pressure from the U.S. market, it has not simply chosen to back down. On the one hand, it continues negotiations with the U.S. to secure preferential market access; on the other, it continues to safeguard its industrial policies, energy choices, and strategic autonomy. This approach—neither rushing to a showdown nor compromising easily—is a consistent feature of India’s foreign and economic policies.
Deeper challenges stem from youth unemployment and educational equity. The “Cockroach People’s Party,” which rapidly gained popularity in India this year, began as an online satire but quickly transformed into a force for youth protest. The group’s founder, Abhijit Dipak, arrived in New Delhi to join protests against the Modi government, with demands centered on youth unemployment, exam leaks, and the resignation of Education Minister Damendra Pradhan. India’s population aged 15 to 29 is nearly 400 million, and the youth unemployment rate in April was close to 14%. Protesters at Jantar Mantar wore cockroach masks and held national flags and books to express their dissatisfaction with unemployment, educational inequality, and economic disparities.
The Indian government should take these social sentiments seriously. Young people are at the heart of India’s demographic dividend and form the labor base for the future manufacturing, service, and technology sectors. If educational examinations frequently face crises of credibility and youth unemployment remains high, the demographic dividend could turn into political pressure. However, it should also be noted that while Indian youth have chosen to vent their dissatisfaction through online expression, peaceful protests, and public discourse, they have not immediately descended into uncontrolled confrontation. This indicates that Indian society still possesses a considerable degree of space for expression and self-regulatory mechanisms. For the government, this presents both a challenge and an opportunity to adjust its policies.
The Modi administration’s proactive measures this year have primarily manifested in three areas. First, stabilizing growth. Even as the external environment deteriorated, India maintained relatively high growth by relying on agriculture, construction, private investment, and government capital expenditure. Second, stabilizing supply. Faced with extreme heat and power shortages, the government did not simply emphasize long-term renewable energy goals but continued to rely on coal-fired power, crude oil supplies, and grid dispatch as practical supports. Third, stabilizing expectations. Whether in response to the depreciation of the rupee or U.S. tariff negotiations, India did not react emotionally but maintained market confidence through negotiations, interventions, and policy statements.
