Veteran Indian banker Uday Kotak strongly criticized a United States proposal to "rent" the Strait of Hormuz, labeling it a return to colonialism. Speaking on Tuesday, April 7, 2026, at a FICCI foundation day event in Mumbai, Kotak, the founder and director of Kotak Mahindra Bank, warned that such actions reflect a dangerous shift in global geopolitics. He highlighted recent comments made by former US President Donald Trump regarding control over the vital global oil transit route.[m+5]
Kotak Cites Trump's 'Spoils of War' Remarks
Kotak's sharp remarks came as he referenced explicit statements from former US President Donald Trump. Trump reportedly asserted a principle that "whoever wins the war keeps the spoils." Furthermore, he suggested that if the United States gains control of the Strait of Hormuz, it would impose a charge, or "rent," for its passage. Kotak explicitly stated during his speech that he was repeating these facts directly from Trump's earlier address at the White House.[m+3]
The concept of controlling and "renting" the Strait of Hormuz signifies a clear move towards hard-power geopolitics, according to Kotak. He cautioned that the world is currently at a very important juncture, potentially entering a new phase of what he termed "global colonialism." This situation, he argued, mirrors historical patterns where economic and strategic control were the primary drivers of global power dynamics.[tribuneindia+3]
The Strait of Hormuz is recognized as an exceptionally critical waterway for global energy markets. It facilitates the transit of between 20% and 30% of the world's total oil supplies. The region has been experiencing heightened tensions, particularly due to the ongoing US-Israel conflict that involves Iran. Earlier, former President Trump had issued a stark ultimatum to Tehran, demanding that free passage be maintained through this strategic oil chokepoint. He even threatened the "complete demolition" of Iran's critical infrastructure if the strait was not reopened.[m+3]
Historical Parallels and Shifting Global Power
Uday Kotak drew a powerful and direct parallel between the current geopolitical climate and the historical rise of British colonial rule in India. He elaborated on how the British East India Company, which began purely as a trading enterprise, strategically utilized superior military technology, specifically guns and gunpowder, to gain immense leverage. This technological advantage progressively allowed the company to transition from trade to extensive economic and territorial control, ultimately leading to the establishment of the British Empire's dominance across India.[tribuneindia+2]
Kotak underscored that such contemporary developments resonate with historical patterns of colonial expansion. He suggested that the proposed "renting" of the Strait of Hormuz reflects a potential regression to the global order that prevailed before 1945. This pre-1945 era was largely characterized by international relations being shaped more by the exercise of raw power and territorial ambitions rather than adherence to established international rules and cooperative frameworks.[timesofindia+2]
The veteran banker also observed a significant and ongoing shift in the global balance of power. He identified at least three major global powers—the United States, China, and potentially Russia—as possessing substantial economic and strategic leverage over other nations. Kotak conveyed his concern that these recent developments collectively indicate a world that is increasingly being governed by power dynamics rather than a stable, rules-based international system. He stated, "At this stage there are at least three powers with significant leverage over others… one is US, second is China and third rising because of geopolitics may be even Russia."
India's Economic Strategy Amid Global Uncertainty
Against this backdrop of global uncertainties and the looming specter of "new colonialism," Uday Kotak strongly urged Indian businesses, collectively referred to as "India Inc," to fundamentally reassess and enhance their approach to innovation, manufacturing, and energy security. He specifically called for a dramatic increase in investment towards research and development. Kotak emphasized that this heightened focus on R&D is absolutely vital for achieving India's ambitious self-reliance goals, encapsulated in the "Atmanirbhar Bharat" initiative.
Kotak pinpointed the "middle manufacturing" segment as a critical area requiring immediate strengthening. He characterized this sector, which includes companies investing between ₹100 crore and ₹1,000 crore, as the weakest component within India's broader industrial ecosystem. He asserted that bolstering this segment is paramount for building long-term economic resilience and reducing the nation's reliance on external dependencies. Kotak also urged Indian companies to introspect why, despite excelling in trade and services, they have not moved to productizing services like their counterparts in the US.[tribuneindia+4]
The ongoing geopolitical shocks emanating from West Asia have already had tangible impacts on global markets. Notably, crude oil prices have surged, with Brent crude reaching $116.48 per barrel on April 7, 2026. This significant rise in oil prices directly contributes to increased inflation and introduces considerable supply chain risks for Indian businesses and financial institutions. Kotak underscored that strengthening domestic industry is a key strategy for navigating these economic challenges and ensuring national economic stability.[madhyamamonline+2]
Kotak cautioned against dismissing the possibility of profound structural changes in the global order, urging that a low probability should not be equated to zero. He called for a "sense of paranoia and a purpose" within India to effectively capitalize on opportunities that arise in this rapidly evolving global landscape. He concluded that while India has demonstrated phenomenal success in entrepreneurship and services, there is an undeniable need to shift greater focus towards product development and robust manufacturing to build genuine and enduring economic strength.[whalesbook]
