2.2 Technology Consolidation
Digital technology is built around processors and the performance of hardware is defined by the processing power. This has allowed successful processor designers to dominate the hardware market of computers, tablets, mobile phone etc. The consolidation of market share among few players like Intel (60 percent global market Computer market) followed by AMD. (13) The Taiwan based semiconductor foundry TSMC- holds over 60 percent of global foundry market, followed by Samsung with more than 10 percent market share. (14) TSMC customers include big tech companies including Apple, Nvidia, Qualcomm and AMD. The dominance expands as we go deeper into the manufacturing process. The deepest technology is held by companies which manufacture the machines that make semiconductor. Advanced Semiconductor Materials Lithography (ASML), Veldhoven, a Holland-based company has a monopoly over extreme ultraviolet lithography machines required for advanced chip manufacturing. Each EUV lithography machine costs USD 200 million. (15) In the global supply chain, ASML is the narrowest bottleneck. The power that ASML has on the global economy is just unimaginable.
This is not the case with semiconductor industry but it is for currency note publishing. UK based De La Rue, the world leader in security feature design in the currency notes printing, digital and physical authentication solution and passport printing, has an employee base of just 1600 and is involved in almost half of global currency printing. (15) This business allows De La Rue to have the most critical information on its client countries. It is a similar situation in health care technology where few players dominate imaging and diagnostic system manufacturing. The consolidation of core technology is a universal phenomenon across all sectors, and it erodes the authority and political power of states.
One of the major challenges to any effective regulating mechanism is the secrecy in which Tech companies like Google, Apple, Microsoft etc., operate. Then there are Renaissance Technologies, quantitative trading hedge funds, using secret algorithm to predict market movement. And then there is Elon Musk’s Neuralink working on brain-machine interface. (15) It is not corporations but the people who control them who are the most powerful. They have the power to resist the authority of states. World’s richest man Musk has supported Trump, partnered with his administration and his audacity in standing first against the Biden administration, and then against Trump is derived from the services he provides to US government agencies like NASA, the Pentagon and the Intelligence community through the starlink satellite network etc. (16) In the future many more tech leaders will challenge governments.
Recently emerged deep fake and AI generated videos are trending on social media and are blurring the line between real and fake. Their impact on law enforcement, financial frauds and society at large is yet to be ascertained. Since these technologies are self-funded by companies, there is very little regulation space for institutions. How can government and society regulate something which they do not know is coming? Technology companies are moving towards quasi-sovereignty.
2.3 FinTech
The rise of digital payment systems and crypto currencies are changing the world of finance and transnational payments. They will reduce the cost and enhance the efficiency of international transactions. They may eliminate the international credit card system for cross-border operations where American Visa and Mastercard have absolute dominance.
The QR code-based payment system has emerged as one of the major disruptors in the global financial system. National QR payment systems are slowly taking regional and global dimension. India’s QR codes payment system – UPI has an associated RuPay credit card which has taken 28 percent of the Indian credit card market. UPI claims 71 percent of all transactions in India. (17) The total value of transactions through UPI in December 2024 exceeded two trillion rupees. It went above 2.5 trillion in May 2025. (18) The global payment market was valued at USD 88 billion in 2024, and the sector is expected to see a compound annual growth rate of 38 percent. (19) Indian UPI has been granted permission to operate in seven countries, namely, France, Bhutan, Srilanka, Mauritius, Singapore, UAE and Nepal. ASEAN nations are working towards regional settlement systems for cross-border payment. The Regional Payment Connectivity (RPC) initiative, launched in late 2022, would enable QR code-enabled local currency-based systems, replacing the current dollar-based system. (20)
Digital Currencies are the new alternative to physical currency. They are created and stored digitally. They shift values. They require network compatibility to execute transaction between parties. They come in two forms: regulated – released by Central Banks, and unregulated – coined by developers. Crypto-currency is another form of digital currency created and secured by cryptography, like bitcoins. (21) According to an IMF study, the transaction cost of wholesale business is around 0.1 percent whereas for retail transactions it ranges from 1.5 per cent for Business to Business to 6.5per cent for Consumer-to-Consumer. IMF estimates a 80 per cent reduction in cost for cross-border digital currency transactions. The political impact of digital currencies, especially crypto currencies, is immense. They may reduce the number of dollar dependent transactions substantially, as retail commerce would be channelized through either regional QR code settlements or digital currencies. The need for SWIFT to transfer fuds would be not required, thus reducing the global demand of dollar. (22)
The geopolitics of crypto has begun to appear. Recently, Pakistan has announced a plan to create a crypto currency reserve and regulate crypto users in the country. which has witnessed a surge in interest from global crypto players. There is a deal between president Trump’s crypto currency $Trump with World Liberty Financial (WLF) which is supporting Pakistan in the use of block chain technologies and crypto-currency. (23)
2.4 Democratization of Military Technology
Iran has displayed the democratisation of military might which changed the global power dynamics. It was feared that with the militarisation of off-the-shelf commercial technology (drones, surveillance, GPS-based etc.) medium powers or nations with decent industrial and technical capacity would be able to sustain conflicts with major global powers.
Iran has weaponised its national industrial and technical capabilities to an extent where it has produced missiles in the thousands and secured them inside underground cities, simultaneously, arming Houthis and Hezbollah with enough quantities of drones, missiles and rockets to sustain the continuous assaults of Israel and western forces in the Red Sea zone for over two years.
Iran is just an example of a nation which has achieved what many nations are capable of doing as well. The world is witnessing a scattering of global industrial supply chains, which will expand the skilled industrial workforce, making developing nations self-sufficient in the production of electronics, communication and propulsion technologies. With the expansion of technical education in developing nations, the barriers imposed by global controls would become inconsequential, especially in aeronautics, shipping, finance, computing, space and nuclear sectors. These are the technologies on which the modern power structure is based.
The new global power structure will be based on new technologies. This would be possible only when a group of nations master and provisionally monopolise a complete set of futuristic technologies that would bring about a new global dependency. This situation is at least two decades away.
2.5 Missing Political Philosophy
Since the dawn of the civilization, humankind has been guided by a grand philosophy which provides a moral code for every aspect of social life: From Confucius and Tao in ancient China, to various schools of philosophy in India and Greece with its famous trio – Socrates, Plato, and Aristotle who taught Alexander; Rome had its own line of stoic philosophers starting with Zeno of Citium, Seneca, Marcus Aurelius etc. Similarly, the medieval world was dominated by Abrahamic religions and their theological tules. The rise of modern world was chaperoned by science, technology, and a related philosophy.
Every major shift in last 500 years has been nursed by one or a set of philosophical ideas. Rene’ Descartes (1596-1650), considered as ‘Father of Modern Philosophy’, said, “I think therefore I am”. This was the beginning of rationalism, and the rejection of scholasticism prevalent. Independent enquiry led to scientific breakthroughs and the intellectual arguments of John Locke’s who affirmed natural rights to ‘life, liberty and property’. That became the ideological foundation of the American and French Revolutions.
Immanuel Kant’s idea of enlightenment is the basis of secular ethics and universal laws. All these ideas were challenged by Karl Marx who looked at history as struggle for material power and demanded a change in the power hierarchy, heralding global socialism. On the other hand, Friedrich Nietzsche (1844-1900) declared the ‘Death of God’ and that man should create new values as a form of nihilism. This is the perfect recipe for disaster as the two main foundations of the industrial world, labour and capital were at loggerheads, leading to world war and then cold war.
Having asked the individual to stand for himself and discard the traditional structure of society, Nihilism and Communism led to Existentialism which argued for absolute personal freedom. When applied to feminism, it led Simone de Beauvoir to challenge the notion of gender and argue that society and not biology makes women what they are. Accordingly Michel Foucault called for the deconstruction of all power structures of society that shape our identities. The world we live in is being shaped by identity politics which aims at the atomisation of the individual, discarding the ideas of nation, country, family, society, culture, and making hi available for exploitation by political powers, states and corporations. Individual desires for a hedonistic lifestyle supersede the common good. This challenges the sovereignty of nation.
As the technologies will progress towards militarisation and automation, self-destructing pleasures would be the new opium, where the control over individual life would be in the hands of corporates providing the opium in the form of social media and virtual realities.
The world needs a grand philosophy to restore balance between the individual and the power structures of society – government, corporate, society, family. In the last two decades, emerging technologies are creating new habits which are in conflict with the human body and brain. Their long-term impact is expected to be devasting. There is a need to save the body not through legislation but by challenging the very concepts that have spawned new lifestyles.
3. Conclusion
Sovereignty should not only be associated with the Nation alone as historically, family, clan, tribe, religion, teh city and culture were sovereign in their respective domains. They ensured the continuity of social order across historical tragedies like famine, genocide, mass migration, colonialism, and slavery. It is only upon the collapse of any civilization that all of these structures would dissolve.
In the globalised world where corporates are displaying sovereign behaviour and technology is moving away from the control of society and nation into private hands, it is critical for nations to be self-reliant and achieve self-sufficiency through their own industrial means, slowly replacing global corporations with home-grown ones, even at the cost of seeming backward. Every penny flowing to global tech giants is available for the erosion of national sovereignty. Nations and societies are thereby funding their own devolution.
References
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