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Subject: Bilateral Relations

1. Major World Events
2. India’s Interests in neighbourhood
3. Effects of our Policies

  • Non-War Military Tactics used by China

    An annual report from the U.S. Department of Defense describes Chinese leaders’ use of tactics short of armed conflict to further the country’s objectives, citing border conflicts with India and Bhutan among the examples.

    Try this question:

    Q. What are Non-War Military Activities (NWMA)? Discuss how China is using NWMA as a tool for its overtly ambitious expansionist policy.

    Various non-war military tactics

    The report describes Non-War Military Activities (NWMA) as one of two kinds of military operations (the other is war) used by the PLA. NWMA can be conducted internationally or domestically and encompass activities in multiple domains.

    (1) Provoking armed conflict

    • China calibrates its coercive activities to fall below the threshold of provoking conflict with the United States, its allies and partners, or others in the Indo-Pacific region.
    • It can notably include operations in which the PLA uses coercive threats and/or violence below the level of armed conflict against states and other actors to safeguard its expansionism.
    • These tactics are particularly evident in China’s pursuit of its territorial and maritime claims in the South and East China Seas as well as along its border with India and Bhutan.

    (2) Neo-imperialist tools

    • China also employs non-military tools coercively, including economic tools during periods of political tensions with countries that China accuses of harming its national interests.
    • The Belt and Road Initiative is leading to a greater overseas military presence for China in the guise to protect its economic interests.

    (3) Multilateralism as a strategic messaging tool

    • The report says that China uses multilateral forums and international organisations to generate new opportunities to expand its influence, strengthen its political influence.
    • It promotes strategic messaging that portrays China as a responsible global actor, advances its development interests, and limit outside interference in and criticism of its initiatives.
    • The Brazil Russia India China South Africa (BRICS) grouping and Shanghai Cooperation Organization are among those cited as examples of this alleged phenomenon.

  • India needs an internationalism that is rooted in realism

    The article analyses India’s approach towards regional integration in Asian unity and internationalism and its consequences.

    Clash between internationalism and nationalism

    • Three current developments reveal the clash between grandiose internationalism and the intractable nationalism.
    • 1) India pulled out of the military exercise of the Shanghai Cooperation Organisation, which was to herald a new era of Eurasian unity.
    • Sharpening contradictions between India and China comes in the way of uniting such a large geopolitical space.
    • 2) Turkish President Recep Tayyip Erdogan’s claim to leadership of the Muslim world that has run into resistance from a large section of the Arab rulers.
    • 3) The tension between the globalism of the US foreign policy establishment and Donald Trump’s “America First” nationalism.

    Internationalism and threats to it

    • Western liberalism has had more power than anyone else to promote internationalism.
    • But the liberal internationalist effort at constructing supra-national institutions now faces big setbacks.
    • The greatest resistance to the liberal internationalist vision has not come within the US.
    • Trump channelled the American resentments against the globalist excesses of the Wall Street, Washington and the Silicon Valley.

    India’s nationalism

    • Indian nationalism was inevitably influenced by liberal internationalism, socialism, communism, pan-Islamism, pan-Asianism and Third-Worldism to name a few.
    • Both the Asian Relations Conference (Delhi 1947) and the Afro-Asian Conference (Bandung 1955) showed up the deep differences among the Asian elites.
    • India then turned its back on Asianism to claim the leadership of the broader Non-Aligned Movement.
    • After the Cold War, India re-embraced Asianism in the 1990s when it unveiled the Look East Policy.
    • India also joined the Asian regional institutions led by the Association of South-East Asian Nations.

    RCEP joining issue

    • Few could have anticipated that Delhi would walk out of one of the most consequential agreements negotiated by the ASEAN — the RCEP — that sought Asia-wide economic integration.
    • Delhi believed that the contradiction between India’s domestic commercial interests and a China-led Asian economic regionalism was irreconcilable.

    India’s approach toward Asian regionalism

    • Eurasian regionalism led by Moscow and Beijing is also facing tensions and there is deepening conflict between Indian and Chinese interests.
    • India’s diplomatic finesse on the SCO has become increasingly unsustainable after Chinese aggression in eastern Ladakh.
    • India underestimated the economic and political consequences of China’s rapid rise while seeking economic regionalism in East Asia and the multi-polar world with Russia and China.
    • India took a benign view of Chinese power and has been shocked to discover otherwise in 1962 and in 2020.

    Conclusion

    India today needs more internationalism, than less, in dealing with the Chinese power. But it must be an internationalism that is rooted in realism and tethered to India’s economic and national security priorities.

  • Supply Chain Resilience Initiative (SCRI)

    With COVID-19 and trade tensions between China and the US threatening supply chains or actually causing bottlenecks, Japan has mooted the Supply Chain Resilience Initiative (SCRI) as a trilateral approach to trade, with India and Australia as the other two partners.

    Q.Discuss the efficacy of the idea of Supply Chain Resilience Initiative (SCRI) initiaited by Japan.

    What is Supply Chain Resilience (SCR)?

    • In the context of international trade, SCR is an approach that helps a country to ensure that it has diversified its supply risk across a clutch of supplying nations instead of being dependent on just one or a few.
    • Unanticipated events whether natural or man-made that disrupt supplies from a particular country or even intentional halts to trade, could adversely impact economic activity in the destination country.

    What is Japan proposing?

    • The pandemic has brought into sharp focus the assembly lines which are heavily dependent on supplies from one country.
    • While Japan exported $135 billion worth of goods to China in 2019, it also imported $169 billion worth from the world’s second-largest economy, accounting for 24% of its total imports.
    • So, any halt to supplies could potentially impair economic activity in Japan.
    • In addition, the U.S.-China trade tensions have caused alarm in Japanese trade circles for a while now.
    • If the world’s two largest economies do not resolve their differences, it could threaten globalisation as a whole and have a major impact on Japan.
    • It is heavily reliant on international trade both for markets for its exports and for supplies of a range of primary goods from oil to iron ore.

    Japan eyeing India as a partner for the SCRI

    • Japan is the fourth-largest investor in India with cumulative FDIs touching $33.5 billion in the 2000-2020 periods.
    • It accounts for 7.2% of inflows in that period, according to quasi-government agency India Invest.
    • Imports from Japan into India more than doubled over 12 years to $12.8 billion in FY19. Exports from India to the world’s third-largest economy stood at $4.9 billion that year, data from the agency showed.
    • It is a clear reflection that the two countries are unlikely to allow individual cases to cloud an otherwise long-standing and deepening trade relationship.

    Where does Australia stand?

    • Australia, Japan and India are already part of another informal grouping, the Quadrilateral Security Dialogue, or the Quad, which includes the U.S.
    • Media reports indicate that China has been Australia’s largest trading partner and that it counts for 32.6% of Australia’s exports, with iron ore, coal and gas dominating the products shipped to Asia’s largest economy.
    • But relations including trade ties between the two have been deteriorating for a while now.
    • China banned beef imports from four Australian firms in May and levied import tariffs on Australian barley.

    India’s stand to gain or lose

    • Following the border tensions, partners such as Japan have sensed that India may be ready for dialogue on alternative supply chains.
    • Earlier, India would have done little to overtly antagonize China. But an internal push to suddenly cut links with China would be impractical.
    • China’s share of imports into India in 2018 stood at 14.5%. It supplies dominate segments of the Indian economy.
    • Sectors that have been impacted by supply chain issues arising out of the pandemic include pharmaceuticals, automotive parts, electronics, shipping, chemicals and textiles.
    • Over time, if India enhances self-reliance or works with exporting nations other than China, it could build resilience into the economy’s supply networks.

  • Striving for amicable relations with Pakistan

    The article pitches for the resumption of India-Pakistan relations. But there are obstacles on both the side which come in the way of such resumption.

    Pakistan and relations over Kashmir issue

    •  In July, the Turkish president had assured Pakistan’s parliament of his country’s support for Islamabad’s Kashmir stand.
    • More recently, Malaysia’s former Prime Minister, Mahathir Mohamad, has reiterated his backing for that stand.
    • Iran’s current negotiations with China do not necessarily mean alignment with the latter’s Kashmir policy.
    • Saudi Arabia and the Gulf countries invited official criticism in Pakistan first time for their refusal to back Pakistan in its disputes with New Delhi.
    • Pakistan’s foreign minister had made a remark against Saudi Arabia over its reluctance to convene the meeting of IOC.
    • Given the long history of Saudi-Pakistani relations, such remarks suggest a high degree of frustration.

    India’s vulnerabilities and relations with Pakistan

    • An excess of confidence and an unwillingness to think things through may be India’s vulnerabilities.
    • Army’s chief of staff made the statement this year, “If Parliament wants that area [PoK] should be ours at some stage, and if we get such orders, we will definitely act on those directions.”
    • Prime Minister made the statement regarding time of a week to 10 days to defeat the neighbouring country in case of war.

    Picturing resumption of relations with Pakistan

    • In case of war, aware of the total devastation to follow, neither side in an India-Pakistan conflict will press the nuclear button.
    • On the other hand, it is also possible, before any war, to imagine negotiations that lead, not necessarily in that order, to a resumption of trade, travel and normal relations, the renunciation of terrorism, and the restoration of the democratic rights of the people of Kashmir.
    • While no realistic person today expects such talks, it is not a crime to picture them.

    Conclusion

    Amicable relations with Pakistan may seem remote but they are worth striving for.

  • Leveraging its market to force China to settle border issue

    The article charts out the plan to leverage the potential and the present size of the India markets to settle the boundary dispute with China.

    Boycott of Chinese goods: view and counterview

    • After Galwan incident, there have been calls for the boycott of Chinese goods.
    • Counter views have been expressed that the Indian economy is so dependent on China that the costs would be disproportionately higher for India.
    • Our dependence can be reduced substantially if there is a national will and resolve to do so.

    Need for mutually acceptable boundary agreement

    • China may not be willing to go back substantially from the areas they have occupied.
    • Agreeing on maintaining peace and tranquillity or clarification of the LAC has left space for the Chinese to create border incidents which have now led to casualties.
    • So India needs to get China to seriously negotiate a mutually acceptable boundary agreement.

    India could use its market as leverage

    • Size of Indian market: The size of the Indian market and its potential in the coming years provides India considerable leverage.
    • But to use this leverage, Indians, individual consumers as well as firms, have to accept that there would be a period of adjustment in which they would have to pay higher prices.
    • The Chinese have a competitive advantage and are integral to global supply chains.
    • But whatever they sell is, and can be, made elsewhere in the world.
    • Indian can produce everything imported by China: Most of what we import from China was, is and can be made in India itself.
    • With volumes and economies of scale, the cost of production in India would decline as it did in China.

    Steps need to be taken to use market as leverage

    • Focus on those imports from China which have been increasing: The initial focus should be on items which are still being made in India and where imports from China have been increasing.
    • Depriciate Rupees: If the RBI let the currency depreciate in real terms it would be equivalent to an increase in import duties of about 10 per cent.
    • China-specific safeguard duties and use of non-tariff trade barriers should be used in segments like electrical appliances to let Indian producers expand production and increase market share.
    • Government Finances for expansion: The government should also facilitate the flow of finances for expansion and provide technical support for testing, improving quality and lowering costs of production.
    • Look for other players: In critical areas such as Active Pharmaceutical Ingredients, we need a vigorous approach to procure from elsewhere and have early production in India.
    • The government could provide support for environmental compliance to bring down costs of production.This would create demand for domestic goods and services.
    • There are strategic sectors where we should reduce vulnerability: Like scrutiny of -Chinese FDI, Chinese 5G participation etc.
    • Assured government procurement: In critical areas like solar panel and grid storage batteries private investment for manufacturing in India would be triggered by assured government procurement.

    Consider the question “Size and potential of India market could be leverage by India to settle the issues it has with its neighbour. What India needs to achieve this is a strategy and its implementation. Comment.”

    Conclusion

    A sustained and graded economic response to the recent Chinese conduct on the border is needed. We should signal India’s firm resolve and willingness to bear the cost. China could choose to settle the border amicably and have full access to our market. We could then work together to make this the Asian century.

  • Seeking equilibrium with China

    The article analyses the India’s efforts to establish strategic equilibrium with assertive China and how that idea clashes with China’s desire to form an Asian order with itself at the top.

    Strategic equilibrium

    •  External Affairs Minister S Jaishankar articulated that India is seeking strategic equilibrium with an increasingly aggressive China.
    • It is hoped that with China’s growing differences with the U.S. China would pay attention to India’s sensitivities.
    • In achieving equilibrium with China, India has bravely been confronting a face-off in the Himalayas for the past several months.
    • India has been building issue-based alliances with the US and Asian majors like Japan, Korea, Vietnam and Indonesia, and Australia.
    • It has taken initiatives in the direction of economic de-coupling with China in the name of “atmanirbharata”.

    Hierarchical Asian order with China at top

    • China is not interested in equilibrium with any of its Asian neighbours, least of all with India.
    • China’s efforts are clearly to build a hierarchical Asian order, with itself at the top.
    • It is acutely conscious of India’s economic strength, military modernisation and overall capabilities.
    • It knows that India is also far behind on these counts.
    • China is ruthlessly resisting India’s access to global governance bodies, such as the UNSC and NSG.
    • To keep India tied at that level, China is objecting to India’s growing strategic proximity to the US. I
    • It is encircling India strategically and economically through its strategic and economic corridors — BCIM (Bangladesh, China, India and Myanmar), CPEC and the Trans-Himalayan Connectivity Network.
    • It is raising issues like Kashmir at the UN and establishing footprints in the Indian Ocean.

    What should India do

    1. Adjust with China, at least tactically.

    • Such an adjustment could be based on mutual give and take.
    • For India, our first priority could be the resolution of the border dispute.
    • Secondly, since China has offered to mediate between India and Pakistan, it should be asked to prevail over Pakistan to resolve the Kashmir issue.
    • In return for these “takes” India could offer access to Chinese commercial cargos to sea, through the Nathula pass.
    • India could also join China’s BRI on mutually acceptable terms.
    • India may also show its willingness, at least tactically, to join CPEC as both Pakistan and China have asked for, provided, India is allowed to undertake projects in PoK and Balochistan.

    2.India should revisit its Tibet policy, which is a core irritant for China.

    Consider the question “China seeking to establish an Asian order with itself at the top comes in the way of India establishing strategic equilibrium with China. Comment.”

    Conclusion

    It is possible that this “give” and “take” may not be acceptable to China. Even if it does not work out as planned, India would have made a bold diplomatic initiative and a huge tactical move towards thinking through out-of-the-box solutions and displaying that it can undertake risks to pursue its long-term national interests.

  • India’s strategic autonomy and its evolution

    The article analyses the evolution of India’s approach to strategic autonomy from the unipolar world dominated by the U.S. to now when the Chinese threat has been looming large.

    Context

    • Addressing a Southeast Asian forum last week, external affairs minister outlined India’s new quest for “strategic autonomy” in its global economic engagement.

    Connection with Atmanirbhar Bharat

    • This new quest for “strategic autonomy” is the natural external complement to new economic strategy, described as “Atmanirbharata” or “self-reliance”.
    • The concept carries so much ideological baggage, its revival by Government inevitably raised many questions
    • Senior ministers and officials of the NDA government sought to reassure India’s partners that Delhi was not marching backwards.
    • When applied to the foreign policy framework, “self-reliance” becomes “strategic autonomy”.

    Evolution of the idea of strategic autonomy

    • America towered over the world after the collapse of the Soviet Union in 1991.
    • India’s past emphasis on strategic autonomy was in the context of the “unipolar moment” [dominated by the U.S.] that emerged after the Cold War.
    • On the one hand, India needed Western capital as well as technology and better access to its markets.
    • On the other hand, Delhi had to protect some of its core national interests from the threats of US intervention.

    India-U.S. Relations: Evolution after the Cold war

    • In the early 1990s, the Clinton Administration strong desire to resolve the Kashmir dispute between India and Pakistan.
    • The Clinton Administration saw the nuclear and Kashmir disputes as one and the same thing.
    • Indian diplomacy for the next two decades tried to change the US policy on both Kashmir and nuclear issues.
    • Under President George W Bush, the US discarded the long-standing temptation to insert itself in the Kashmir dispute.
    • The US also went out of the way to resolve the nuclear dispute with India by changing its domestic laws and international norms on nuclear proliferation.
    • The Obama and Trump Administrations have stayed the course since then.

    China challenge for India

    • On the atomic front, as the US sought to lift the prolonged atomic blockade against India, China sought to block the process.
    • China turned an obstacle to India’s membership of the Nuclear Suppliers Group.
    • China takes up the Kashmir issue regularly in the United Nations Security Council.
    • Today, India’s strategic autonomy is about coping with China’s challenge to India’s territorial integrity and sovereignty.
    •  China today is viewed in Delhi as a major threat to India’s economic development.
    • The bilateral trade deficit reached nearly $55billion in 2019.
    • India pulled out of an Asia-wide free-trade arrangement called the Regional Comprehensive Economic Partnership late last year, sensing the threat posed by China-led economic order.
    • Ladakh aggression forced India to go from a passive commercial withdrawal to an active economic decoupling from China.

    Way forward

    • The logic of strategic autonomy from China nudges India to look for strong security partnerships with the US, Europe, Japan and Australia.
    • On the economic front, India is exploring various forms of collaboration with a broad group of nations that have a shared interest in developing trustworthy global supply chains.

    Consider the question “Delineate the evolution of India’s approach towards the idea of strategic autonomy. How it differs from the past?”

    Conclusion

    Threats to either territorial integrity or economic prosperity are powerful enough on their own to compel drastic changes in any nation’s policies. Coming together, they promise to make strategic autonomy from an assertive China an enduring theme of India’s economic and foreign policies in the years ahead.

  • Thinking through the Nepal policy

    Unilateral actions by Nepal

    • Minor dispute involving territory around the Kalapani springs, was expanded to claim a large wedge of Indian territory towards the east, measuring nearly 400 square kilometres.
    • The expanded claim was incorporated into Nepal through a constitutional amendment and a revised official map.

    Future course of action

    • India should be willing to engage in talks with Nepal on all aspects of India-Nepal relations.
    • But any talks on the Kalapani issue should be limited to the area which was the original subject for negotiations and Susta.
    • Borders which have been accepted by both sides for more than 100 years and which have also been reflected on their official maps cannot be unilaterally altered by one side coming up with archival material which has surfaced in the meantime.
    • This would make national boundaries unstable and shifting, and create avoidable controversies between countries as is the case now between India and Nepal.

    Some historical background

    • The Treaty of Sugauli of 1816 sets the Kali river as the boundary between the two countries.
    • There was no map attached to the treaty.
    • Nepal is now claiming that the main tributary of the Kalapani river rises east of the Lipu Lekh pass from the Limpiyadhura ridgeline and hence should serve as the border.
    • Even if the lengthiest tributary may be one principle for a riverine boundary, it is not the only one.
    • There are many boundaries which do not follow any geographical principle at all but are the result of historical circumstances, mutual agreement and legal recognition.
    • British surveys of the region consistently showed the India-Nepal border heading due north of Kalapani springs.
    • This alignment never changed in subsequent years and was also reflected in Nepali official maps.
    • It has been argued by Nepal that it was the East India Company and successor governments “cartographic chicanery” to shift the source of the Kali river towards the east.
    • But Nepali government never contested such actions.
    • In 1969, the then Prime Minister of Nepal demanded that India military personnel manning 17 villages along the Nepal-Tibet border since the early 1950s be withdrawn.
    • If Lipu Lekh and Kalapani were on Nepali territory then why were they omitted from the list?
    • The Chinese, at least since 1954, have accepted Lipu Lekh Pass as being in Indian territory.
    • In the Nepal-China boundary agreement of 1960, the starting point of the boundary is clearly designated at a point just west of the Tinker Pass.

    Consider the question “Nepal’s newfound aspiration has led to the introduction of friction in India-Nepal ties, what is needed is recognition of each others’ concerns. Comment.”

    Conclusion

    For India, more than the exemplary inter-state relationship, it is the unique people-to-people relations between India and Nepal; and, fortunately, inter-state relations have been unable to undermine the dense affinities that bind our peoples together. While India should reject the Nepali state’s ill-conceived territorial claims, it should do everything to nurture the invaluable asset it has in the goodwill of the people of Nepal.

  • Explained: Pakistan-Saudi Rift

    The rift between Pakistan and Saudi Arabia over Jammu and Kashmir is out in the open after a delegation led by Pak Army Chief was denied a meeting with Crown Prince Mohammed bin Salman (MBS).

    Try this question:

    Q. Discuss the new geopolitical realignment in the Arab world and India’s role in it.

    Take a look after how the ties emerged and deteriorated:

    Saudi-Pakistan ties: A Recap

    • The relationship between Saudi Arabia and Pakistan was most prominent during the 1971 war between India and Pakistan.
    • Saudi Arabia is also reported to have transferred arms and equipment including the loan of some 75 aircraft to Pakistan.
    • After the war, Saudi Arabia consistently supported the call for the return of Pakistan’s prisoners of war and for dropping the Dacca (Dhaka) Trial against 195 of them.
    • After the war, Saudi Arabia gave loans to Pakistan enabling it to buy arms worth about $1 million by 1977, including F-16s and Harpoon missiles from the US.
    • Saudi oil and dollars have kept Pakistan’s economy on its feet after sanctions following the nuclear tests.
    • Over the last two decades, Saudi Arabia has provided oil on deferred payments to Pakistan whenever it ran into economic difficulty.
    • Saudi funding of madrasas has also led to their mushrooming, later giving rise to religious extremism.
    • In 1990, Pakistan sent its ground forces to defend Saudi Arabia against Iraq’s invasion of Kuwait.

    Alignment over Kashmir

    • The alignment over Kashmir at the Organisation of Islamic Conference (OIC) crystallized since 1990 when the insurgency in J&K began.
    • While the OIC has issued statements over the last three decades, it became a ritual of little significance to India.
    • Last year, after India revoked Article 370 in Kashmir, Pakistan lobbied with the OIC for its condemnation of India’s move.
    • To Pakistan’s surprise, Saudi Arabia and the UAE issued statements that were nuanced rather than harshly critical of New Delhi.
    • Over the last year, Pakistan has tried to rouse the sentiments among the Islamic countries, but only a handful of them — Turkey and Malaysia — publicly criticised India.

    The Saudi perspective

    • Saudi Arabia’s change in position has been a gradual process under Crown Prince MBS.
    • As it seeks to diversify from its heavily oil-dependent economy, it sees India as a valuable partner in the region.
    • New Delhi, for its part, has wooed the Arab world over the last six years.
    • From Saudi Arabia to the UAE, it worked the diplomatic levers through high-level visits and dangled opportunities for investment and business
    • MBS, who is looking to invest in India, has taken a realistic view, along with UAE’s crown prince Mohammed bin Zayed.

    Energy connection to India

    • Saudi Arabia is India’s fourth-largest trade partner (after China, US and Japan) and a major source of energy: India imports around 18% of its crude oil requirement from the Kingdom.
    • Saudi Arabia is also a major source of LPG for India.
    • And, with India stopping oil imports from Iran due to the threat of US sanctions, Saudi Arabia is key in this respect as well.

    Saudi-Pakistan tension

    The tension between Saudi Arabia and Pakistan has been brewing for some time.

    • In 2015, Pakistan’s Parliament decided not to support the Saudi military effort to restore an internationally recognised government in Yemen.
    • Later, Pakistan’s then army chief General Raheel Sharif led the Saudi-led Islamic Military Alliance to Fight Terrorism, comprising 41 Muslim countries.
    • In February 2019, after the Pulwama terror attack, it was Saudi Arabia and the UAE that pulled their weight to get Wing Commander Abhinandan released, apart from the US.
    • The Saudi Crown Prince visited Pakistan and India at that time and made it clear that he valued economic opportunities. He did not wade into the Kashmir issue in India or the terrorism issue in Pakistan.

    Frustration over Kashmir

    A year after Article 370 was revoked, Qureshi belled the cat.

    • Pak accuses that Saudi Arabia has failed to deliver on the Kashmir and OIC had not played a leadership role in backing Pakistan against India.
    • This angered Saudi Arabia, which in November 2018 had announced a $6.2 billion loan package for Pakistan.
    • The package included $3 billion in loans and an oil credit facility amounting to $3.2 billion.
    • Riyadh demanded the return of the $3 billion loans and refused to sell oil to Islamabad on deferred payment. Pakistan immediately returned $1 billion, displaying the rift.
    • But, in the current economic situation, Pakistan is unable to pay the next tranche.
    • What has also angered Saudi Arabia is that Pakistan has been trying to pander to Turkey and Malaysia.

    The China factor

    • Pakistan and China have called themselves “all-weather allies” and “iron brothers” (during FMs meet).
    • Over the last year, Beijing has supported Pakistan on Kashmir, raising the issue at the UN Security Council thrice.
    • China has also emerged as Pakistan’s biggest benefactor through its funding of the CPEC.
    • Saudi Arabia too has invested in CPEC projects, to the tune of $10 billion, but Pakistan now looks towards Beijing for both diplomatic and economic support.

    Implications for India

    • Saudi’s silence on J&K as well as CAA-NRC has emboldened the Indian government.
    • At a time when India and China are locked in a border standoff, India has to be wary of Pakistan and China teaming up.
    • But with Saudi Arabia in its corner, for now, it may have leverage over Pakistan — Riyadh would not want a conflict and regional instability.
    • What is key to India’s calculus is that the Pakistan-China and the Pakistan-Saudi axes are not fused together at the moment: It is not a Saudi-Pakistan-China triangle.

  • China twist in Teesta Challenge

    Bangladesh is discussing an almost $1 billion loan from China for a comprehensive management and restoration project on the Teesta river. These discussions with China come at a time when India is particularly wary about China following the standoff in Ladakh.

    Try this question from our AWE initiative:

    Teesta River has become an important factor in India – Bangladesh relations. What are the hindrances in successful implementation of river water sharing agreement and what are its possible implications on India-Bangladesh relations? What could be the possible solutions?

    Teesta Project

    • The project is aimed at managing the river basin efficiently, controlling floods, and tackling the water crisis in summers.
    • India and Bangladesh have been engaged in a long-standing dispute over water-sharing in the Teesta.

    How has the Teesta dispute progressed?

    • The two countries were on the verge of signing a water-sharing pact in September 2011, when PM Manmohan Singh was going to visit Bangladesh.
    • But, West Bengal CM objected to it, and the deal was scuttled.
    • After the regime change in 2014, the government hoped that it could reach a “fair solution” on the Teesta through cooperation between central and state governments.
    • Five years later, the Teesta issue remains unresolved.

    Trends in India’s relationship with Bangladesh

    • New Delhi has had a robust relationship with Dhaka, carefully cultivated since 2008, especially with the Sheikh Hasina government at the helm.
    • Security: India has benefited from its security ties with Bangladesh, whose crackdown against anti-India outfits has helped the Indian government maintain peace in the eastern and Northeast states.
    • Trade: Bangladesh has benefited from its economic and development partnership. Bangladesh is India’s biggest trade partner in South Asia.
    • Bilateral trade has grown steadily over the last decade: India’s exports to Bangladesh in 2018-19 stood at $9.21 billion, and imports from Bangladesh at $1.04 billion.
    • Visas:India also grants 15 to 20 lakh visas every year to Bangladesh nationals for medical treatment, tourism, work, and just entertainment.

    Recent irritants in ties

    • There have been recent irritants in the relationship.
    • These include the proposed countrywide National Register of Citizens (NRC) and the Citizenship Amendment Act (CAA) passed in December last year.
    • Bangladesh had insisted that while the CAA and the proposed nationwide NRC were “internal matters” of India, the CAA move were “not necessary”.

    Chinese affinity with Bangladesh

    • China is the biggest trading partner of Bangladesh and is the foremost source of imports.
    • In 2019, the trade between the two countries was $18 billion and the imports from China commanded the lion’s share. The trade is heavily in favour of China.
    • Recently, China declared zero duty on 97% of imports from Bangladesh. The concession flowed from China’s duty-free, quota-free programme for the Least Developed Countries.
    • This move has been widely welcomed in Bangladesh, with the expectation that Bangladesh exports to China will increase.
    • China has promised around $30 billion worth of financial assistance to Bangladesh.
    • Additionally, Bangladesh’s strong defence ties with China make the situation complicated. China is the biggest arms supplier to Bangladesh and it has been a legacy issue — after its liberation.
    • Recently, Bangladesh purchased two Ming class submarines from China.

    India’s engagement post CAA

    • Over the last five months, India and Bangladesh have cooperated on pandemic-related moves.
    • Hasina supported Modi’s call for a regional emergency fund for fighting Covid-19 and declared a contribution of $1.5 million in March 2020. India has also provided medical aid to Bangladesh.
    • The two countries have also cooperated in railways, with India giving 10 locomotives to Bangladesh.
    • The first trial run for trans-shipment of Indian cargo through Bangladesh to Northeast states under a pact on the use of Chittagong and Mongla ports took place in July.
    • Bangladesh gave its readiness to collaborate in the development of a Covid-19 vaccine, including its trial, and looks forward to early, affordable availability of the vaccine when ready.

    Among other issues

    • The two sides agreed that Implementation of projects should be done in a timely manner and that greater attention is required to development projects in Bangladesh under the Indian Lines of Credit.
    • Bangladesh sought the return of the Tablighi Jamaat members impacted by the lockdown in India.
    • Bangladesh requested for the urgent reopening of visa issuance from the Indian High Commission in Dhaka, particularly since many Bangladeshi patients need to visit India.
    • India was also requested to reopen travel through Benapole-Petrapole land port which has been halted by the West Bengal government in the wake of the pandemic.

    Way forward

    • While the Teesta project is important and urgent from India’s point of view, it will be difficult to address it before the West Bengal elections due next year.
    • What Delhi can do is to address other issues of concern, which too are challenging.
    • Now, the test will be if India can implement all its assurances in a time-bound manner.
    • Or else, the latent anti-India sentiment in Bangladesh, which has been revived after India’s CAA -NRC push can permanently damage the historic ties.

    Back2Basics: Teesta Water Dispute