Understanding India’s Neighbourhood Policy

A peek into India’s foreign relations and policy perspectives with its neighbours

India’s neighbourhood is facing a massive crisis at present. Sri Lanka, Pakistan and Bangladesh are knocking on the doors of the IMF. Pakistan is still recovering from a devastating flood which put one-third of its area underwater.

China is the new elephant in the room and is facing economic stagnation, a real-estate crisis, a banking crisis, supporting a weakened Russia and facing the wrath of its disastrous zero-COVID policy. Nepal and Maldives are hedging with China.

India has seven land neighbours and two island neighbours.

India is no saint; it does have its own problems, but being surrounded by crisis, India isn’t going to escape the aftereffects of what these countries are facing. Being a big brother in the South Asian region, which most small members do not approve of, India still has a long way to go, especially under a government which claims to have improved India’s outlook amongst the world community.

The neighbourhood is the most important area for any country, and it does play a very important role in your stature in the world order. Take the Americas and Western Europe, which are relatively peaceful neighbourhoods. On the other hand, see the crisis in Ukraine or the civil wars in West Asia; bad neighbours can certainly ruin you.

Whether you like it or not, the neighbourhood being a geographical reality cannot be changed. Quoting India’s former Prime Minister A B Vajpayee, “You can change our friends but not neighbours”. He had worked a lot to engage with the neighbourhood, primarily with India’s arch-rival Pakistan. You ultimately are left with no choice. It doesn’t mean you can overstep yourself and gulp down your neighbours like China or Russia.

I take the book written by the eminent author of International Relations, Harsh V Pant, to explain India’s neighbourhood policy in a contemporary scenario. Overall the book is a blend of history and the present mixed with the author’s perspectives and suggestions. The book begins by introducing the audience to important decisions, which are the cornerstone of current neighbourhood policy.

India’s current Neighbourhood Policy was shaped by former PM Narasimha Rao through the Look East Policy in 1991. Through this, India would look to its eastern neighbours and the members of the Association of Southeast Asian Nations or ASEAN. This policy was carried forward by all future Prime Ministers. It was current PM Narendra Modi, in 2014, who unveiled the Act East and Neighbourhood First Policy which are refurbished versions of the Look East Policy and the Gujaral Doctrine.

When PM Modi took the oath of office in 2014, he began his tenure with an extremely unconventional, as well as a positive gesture, by inviting the heads of government of all the neighbouring countries to the oath-taking ceremony. Whether he will be able to continue with this good gesture, only time will decide.

What does India aim for with its current Neighbourhood Policy?

India at present has two aims: To reduce the dominance of China in the Indian Ocean Rim region, as well as maintain its hegemonic presence and to counterbalance and contain Chinese influence in the neighbourhood, which India considers to be its playground (and not China’s).

If you take the broader scenario, India wishes to see itself as one of the important players in the Indo-Pacific, which is a confluence of the Indian and Pacific Oceans. Here, India sides with the United States on its vision of a free and open Indo-Pacific as well as freedom of navigation. Although, India doesn’t want to name or call out China just like Taiwan or U.S. or Japan.

Issues, Stakes, and Policies

Hereby, we will take into consideration India’s policy with each of its neighbouring countries and discuss the issues, stakes, and policies as well as the present relations between India and the neighbour.

Afghanistan

India and Afghanistan, even though they theoretically share a border with each other, you cannot travel to Afghanistan from India as there is Pakistan Occupied Kashmir between both nations.

Ever since the Taliban was ousted in 2001 power through the U.S. war on terror operation, both democratically elected Presidents- Hamid Karzai and Ashraf Ghani, sought a great deal of cooperation with India. Under three Prime Ministers of India, the relations evolved.

India engaged with Afghanistan on two fronts- one at the diplomatic level, between the respective governments and the second at the people-people level. India took an interest in building and providing various projects to Afghanistan and its people. This includes the renowned Afghanistan Parliament building- the National Assembly, which was built at the cost of $90 Million and integrated in late 2015.

Other important projects include Harihud and Sahood Dam, big and small road connectivity works, and the Kabul Drinking Water Project. Indian Companies have also invested a lot in Central Asia-South Asia Power Projects. A lot of Afghan students come to India for Education as well.

There is no doubt that Afghanistan and India want to come closer, but that is impossible because of Pakistan. Thus, India is a very limited beneficiary of the relationship with Afghanistan, and much can be exploited.

Everything was fine until the US, under Trump Administration, entered into an agreement with the Taliban, legitimising the Non-State entity, which India isn’t happy about. Biden Administration took forward the idea and made the US exit from Afghan soil inevitable, making Afghanistan return back to 2000.

Thus, India’s invested relationship with Afghanistan is on a halt. There are multiple attempts being made by both sides, but unless India opens to the Taliban and the Taliban takes into Indian concerns, the deadlock is set to continue.

Pakistan

India and Pakistan are one of the biggest bitter enemies in the world. Both have fought four wars against each other, and several proxy wars continue. The major roadblock between both states is nothing but two issues- Kashmir and Afghanistan.

India-Pakistan relations saw an upheaval in the 2014–15 period but fell apart starting from the 2016 Uri Attack, followed by India’s surgical strikes. The rise of Imran Khan as the PM has not helped improve India’s relations with Pakistan at all.

Since both Nations are not ready to compromise on this issue as both them won’t talk, the dispute is set to continue, and the relationship will not improve.

Read about Kashmir

In Afghanistan, Pakistan is not supporting India’s role as it believes that India will destabilise Pakistan with the help of Pakistan, especially since 2021; it has been facing a lot of problems from the Taliban government.

The major concern from India’s point of view with respect to Pakistan remains to be Terrorism, which it believes originates from Pakistan and is causing trouble in Kashmir and elsewhere.

India’s current Pakistani policy is to diplomatically isolate it and not start talks unless there is calm on the border. Both situations sound bleak, resulting in no progress from both sides. India has stopped people-people connect, cricket matches, direct flights and even the MFN status. The only progress that has happened in the past few years has been opening the Kartharpur Sahib corridor for Sikh pilgrims.

Through UN speeches and International platforms, India names and shames Pakistan and is keeping its counter-strategy active. It wants Pakistan to stay on the FATF grey list. It also hates the growing rapport between Pakistan and China. The Indo-Pak rivalry has also affected the functioning of the SAARC.

The Indus Water Treaty remains to be a treaty which has never been violated between both countries, even at the time of war. In 2020, both countries signed a new ceasefire agreement which has calmed the borders and Line of Control for now.

China

Being India’s direct arch-rival and a growing global hegemon, India doesn’t believe that China is good for all the countries in the neighbourhood. Similarly, on the maritime front, India and China are at loggerheads in the Indian Ocean as China is trying to access multiple ports that potentially surround India.

Chinese President Xi Jinping visited India two times in 2014 and 2019. India-China relations in their current form were the result of PM Rajiv Gandhi’s visit to Beijing in the 1980s. The border disputes between them were kept aside, and relations were made.

Major disagreements between both India and China started in 2012 with the standoff in Depsang, which was followed by multiple standoffs in 2013 in Chumar, in 2017 in Dhoklam and lastly, and 2020 in Galwan. India also refused to be part of China’s Belt and Road Initiative (BRI) as it doesn’t take into India’s concerns as well as the Regional Comprehensive Economic Partnership (RCEP).

India-China relations have always been Up-Down relations with a lot of good and bad times. The 2020 Galwan Valley incident has dampened the improving relations and has never recovered since then. India has banned a long list of Chinese apps and has also blacklisted Huawei. Historically, the question has always been how much we should trust the Chinese.

Currently, India’s strategy is Peace at the border is necessary for improved bilateral relations. The same line that the Modi government has been following in the case of Pakistan. However, India continues to be active in BRICS and SCO. India is now part of QUAD, which is a US-backed forum which is aimed at the containment of China without naming it.

Despite all this, China continued to be India’s top trading partner until recently, when the US overtook China in May 2022. India remains open for companies exiting China, and India has warmed up a lot towards the US for security and building partnerships like 2+2 talks.

Nepal

A tiny country sandwiched between two powers, India and China, has always been hedging with the two. Culturally, it has more similarities with India, but in a lot of other aspects, it works closely with China. For the ruling BJP, Nepal is an important pillar of its Hindutva project, and hence better relations with Nepal are something the party can show as its achievements.

Nepali Nationalism has always been against India and is something which New Delhi isn’t greatly fond of. India has tried to support the democratic process in Nepal to have a friendly government. Under the Communist party, Nepal tends to favour Beijing more than Delhi.

India and Nepal signed the Friendship treaty in 1950, which enabled the free movement of people and goods between the two countries. During the 2015 Earthquake that hit Nepal, both SAARC and BIMSTEC, of which India is a part, helped the country. In 2015, India blockaded Nepal after the passing of a new Constitution in Nepal. This move raised a lot of anti-India sentiments in the country.

In 2020, Nepal raised the border issue of Kalapani and Lipulekh by including them in its map, which raised tensions between both countries. The US and the West have also started influencing the country to counter China.

As of now, India-Nepal relations have a lot to go, and the best way is through people-to-people connectivity and the effective use of cultural ties.

Bhutan

Bhutan is a tiny country surrounded by India on three sides and China on one side. India and Bhutan share a long period of friendship, starting with the Treaty of Perpetual Peace and Friendship in 1949, which called for long-lasting peace between both states.

India has always had a say in Bhutan’s Foreign and Defence Policy. Hence India’s influence in the country cannot be underlooked.

PM Modi’s first International visit was to Bhutan hence reiterating the importance of India-Bhutan Relations. An essential arena of relations between both countries is a power exchange, where India operates multiple dams in Bhutan for energy.

Bhutan always looks forward to India countering China. Thus, India-Bhutan relations are a counter to China. Bhutan is the only country that doesn’t recognise both China and Taiwan. Thus, for Bhutan, India is the Big brother, and there is no sympathy for China. During the 2017 Dhoklam standoff, India came in defence of Bhutan.

India has a Free Trade Agreement with Bhutan as per the 1949 treaty; similarly, the 2007 Treaty allowed land ports not to check and scrutinise trade flowing to Bhutan. Several Indian universities and Bhutanese universities have MoUs. Thus Bhutanese youth will have access to quality education in India.

Bangladesh

India has been credited with the liberation of Bangladesh. But that didn’t bring it closer to India. Initial problems emerged as Bangladesh lacked political stability, followed by a long rivalry between two big parties- Awami League and Bangladesh Nationalist Party.

One important victory was the Ganga Water Sharing Treaty between both countries in 1996. Bus and train services between Kolkata and Dhaka soon followed.

One big divergence in the relations has been Illegal immigration and the porous border where border guards of both sides end up killing civilians. Both BSF and BGP are responsible for the same. The persecution of minorities in Bangladesh has also made India unhappy. A lot of climate refugees have been entering India illegally.

Alongside all the differences, there is a new challenge as Bangladesh is also getting closer to China. It is also a part of the BRI project.

Despite the differences, both countries cooperate a lot in Trade and Commerce. Cyberspace, energy cooperation, tourism, visa, etc., are areas where both countries can expand their relations for sustained friendship amidst differences.

Myanmar

An earlier part of British India, Burma, was separated out and made an independent region. Myanmar is a country known for a lot of political instability, with a military Junta having primary control of the state.

India improved its relations with Myanmar whenever democratic governments were in charge. India has had strong relations with Aung San Suu Kyi, who was the country's leader for a brief period and is currently under detention.

With the military coup in Myanmar, the tide has changed, and now China has the upper hand in the country. India although doesn’t want to anger it too much for two reasons- it might push Myanmar further to China, while on the other hand, India’s long border with Myanmar has been known for the insurgency. Thus alienating the military is not a choice.

The major issue of contention between both countries is border insurgency with India’s East and the Rohingya crisis. The latter originated in Myanmar and has created a refugee crisis in the South Asian region. India currently isn’t welcome any more of them as per the Government. This is after the fact that the Myanmar military has its hand in the Rohingya crisis.

Myanmar has a lot of natural resources which are of India’s interest. Similarly, the Asian Highway AH-2 enters India through Myanmar; hence, there is wide scope for trade, commerce and extensive connectivity.

Sri Lanka

India’s most important and closest island neighbour has also got its mentioned in Indian mythology. It is a tiny country known for high living standards in the subcontinent and a high HDI index. Currently, the country is going through an acute financial crisis.

Historically, Lanka has a vital role in Ramayana, an epic of Hinduism; thus, BJP governments have an extra interest in the country. Also, being a Buddhist-majority nation, India can rake more stakes to tie up with the country.

The country lies in a strategic location, namely on the Indian Ocean Rim region as well as on the International Sea route. Both India and China are competing in the area of maritime dominance.

Sri Lanka has a lot of people of Indian origin. India also had a passive role in the civil war, which also led to the assassination of Indian PM Rajiv Gandhi. It also has a lot of anti-India political parties with a fixed vote bank, which is a threat to improved relations.

Recently, Sri Lanka has grown very close to China which India believes is a threat. The newly built Hambantota port has been leased to China. It is now also an active member of China’s BRI, which India refuses to join. India and Sri Lanka also had a lot of issues concerning fishermen crossing each other's territorial waters, causing tensions.

Maldives

It is an archipelago of many small islands which currently faces a threat from climate change and rising sea levels. Tourism is the major source of revenue for the country. A lot of Indians also work and visit the country.

Just like any other country in the region, Maldives has grown friendly with China and hence has threatened good relations with India. Under different leaders, the relations go up and down. Terrorism and the presence of anti-India forces have also been an increasing concern for India.

Maldives is important for India as it is an integral part of South Asia and the SAARC organisation. India also has FTA signed with the Maldives, which enables trade easily. India has been contributing a lot to Maldives' healthcare sector.

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Conclusion

Except for China and Myanmar, all the countries are part of SAARC. Due to deteriorating India-Pakistani relations, SAARC has become a defunct organisation. Strengthening SAARC is one of the most important ways to improve relations with its neighbours as India is centrally located, and India is the bridge between all the neighbours.

The neighbourhood is facing a lot of crises, and it is up to India to decide whether to turn it into an opportunity or a hostility. This is what this book is all about.

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