Nepal went into the throes of a political turmoil in December 2020. This has not been a one-off instance. India has been accused in the past of sending delegations and diplomats to resolve the turmoil to ensure her interests are not impacted. It was China that rushed a delegation to try and resolve the political spat in 2020. Diplomats based in Nepal opined that China controls Nepal’s internal politics.1 India, on the other hand, was in the news for altogether different reasons; discussing infrastructure projects being executed in Nepal.2 It is possible that India too may have discussed issues with the Nepalese polity. However, there has been no news of the same in the public domain.

Sri Lanka’s Colombo Port acts as a transhipment hub for India. India has been looking to acquire a stake in the East Container Terminal (ECT) of the Colombo Port.3 India’s External Affairs Minister visited Colombo to interact with the Sri Lankan Government supposedly to discuss the issue.4 Sri Lanka, on 03 February 2021 cancelled the tripartite agreement between Sri Lanka, India and Japan for the development of the ETC.5 India, as part of its Neighbourhood First Policy deployed a naval survey ship to Maldives to undertake hydrographic survey.6 The Maldivian Defence Forces tweeted about the Indian Navy Ship Darshak undertaking hydrographic survey. However, comments made on the tweet clearly highlighted that India was not making much headway in its efforts of giving due importance to its immediate neighbourhood.7

India lives in a complex neighbourhood. The last two decades have seen changing geo-strategic landscapes in South Asia. Countries in the region are busy hedging their options to ensure their national interests are accorded due primacy. India has faced challenges in its relations in South Asia with some countries more than others in the past few years. This could probably be attributed to a combination of India’s focus on enhancing internal growth and quality of life as also increased presence of extra regional players pursuing their own national interests. The Covid-19 pandemic has further increased these complexities. India needs to identify gaps in its diplomacy, which if addressed, may enable increased convergence in the region and beyond, particularly in the backdrop of the Covid-19 pandemic.

This paper aims to examine some of the factors that have led to the challenges in India’s relations in its immediate neighbourhood. The paper also aims to identify principal actor(s) active in the region. The paper will focus primarily on Sri Lanka, Maldives and Nepal, which are important partners in the immediate neighbourhood.

India’s Neighbourhood

India has Nepal, Bhutan and China in the North, Bangladesh and Myanmar on the East, Sri Lanka on the South, Maldives in the South West, and Pakistan and Afghanistan in the North West. India has always given a very high priority to her policy towards her neighbours. This is keeping in line with the fact that a peaceful periphery would help focus on India’s developmental goals.8 However, as is the case in most bilateral relationships, it has not always been smooth sailing.

India -Nepal

India and Nepal share an 1850 km land border and have historical linkages with people-to-people connections and an open border. The 1950 India - Nepal Treaty of Peace and Friendship forms the bedrock of their bilateral relations.9 India and Nepal enjoy robust relations across all domains and fields including Defence, with India being Nepal’s largest trading partner.

The robustness of ties notwithstanding, India-Nepal bilateral relations have had challenges. One of the biggest causes for angst in the recent past, in the author’s view, was the 2015 ‘purported blockade’ of Nepal by India.10 This was supposedly due to changes to the Nepalese Constitution brought in by the government of the Prime Minister, Mr KP Oli. This was even though India helped broker a peace deal between the elected government and Maoists’ waging an armed struggle.11 The blame for the ‘blockade’ was dependent on which news outlet/ report/ article was read; it was either Nepal’s internal dynamics or allegedly an Indian coercion tactic.12,13 On ground, the common Nepalese were impacted with shortages in most items, including fuel and medicines. The purported blockade led to Nepal enhancing its relations with China, probably as a counterweight to India. China capitalised on the ‘chill’ in India-Nepal ties. The newfound bonhomie saw China and Nepal signing a Memorandum of Understanding (MoU) on the Belt and Road Initiative (BRI) and a Transit Transport Agreement (TTA) in 2017. The feasibility of a cross-border railway is also under examination. From $1.81 Mn in 2003 to $399 Mn in 2017, Chinese investments/ pledge of investment have seen a substantial jump.14 However, on ground execution is limited.15 Investments/ pledge of investments have obviously bought influence too. The clearest indication of this has been the Lipulekh imbroglio.16 Matters reached an impasse when Nepal promulgated a new map, which was promptly rejected by India.17 The main factors that may have caused subtle friction points in India - Nepal relations can primarily be summarised as: -

  • India’s perceived assertiveness.

  • India’s supposed interference in Nepal’s internal politics.

  • India’s apparent flexing of economic muscle.

  • India misusing its geographic proximity.

  • India’s concern with Nepal’s economic and foreign policy choices.

  • Nepal playing the China card, particularly post 2015, to make India review its stand on various issues.

India - Sri Lanka

India and Sri Lanka share relations that date back to more than 2500 years. Both countries have a history of cultural, religious, linguistic and intellectual engagements.18 Further, as India’s Ministry of External Affairs highlighted, India and Sri Lanka have relations that span political, economic, military, cultural and people-to-people interactions.19 India helped Sri Lanka in its military action against the Liberation Tigers of Tamil Elam (LTTE). However, due to domestic compulsions, India could only acknowledge, to a limited extent, its otherwise robust military assistance to Sri Lanka.20 China and Pakistan supported Sri Lanka openly and this helped both countries in the years ahead.21 The deal signed in 2007 for developing the Hambantota Port with Chinese assistance and subsequent investments in terms of loans by China, further pulled Colombo into Beijing’s arms. The blocking of the United Nations High Commission for Refugees (UNHCR) resolution in May 2009 for investigations into alleged war-crimes in Sri Lanka by China gave a further fillip to Sri Lanka - China relations. India too, incidentally, supported Sri Lanka during the resolution.22 Chinese loans and aid, just a few million in 2005, soared beyond $6 Billion within a decade.23 Sri Lanka today has major challenges in paying back its loans and is getting further pulled into the Chinese orbit.

India - Sri Lanka relations have a domestic dimension too, which is Tamil Nadu. For many years, most political parties in India were wary of formulating any policies, lest the Indian state of Tamil Nadu should raise objections. This did influence India’s foreign policy decisions in respect of Sri Lanka.24 And China’s presence has not helped much along the way. The main challenges in India’s relations with Sri Lanka include: -

  • India’s inability to match its private views with its public stand.

  • India’s perceived inability to deliver on promises.

  • India’s domestic political compulsions.

  • China’s alleged sway over Sri Lanka.

India - Maldives

India and Maldives share ties dating to antiquity. India played an important role to repel a coup attempt against the Government of Maldives in 1988. India’s timely assistance ensured both the government and country were not impacted.25 The relations, however, have seen a downward trend over the years. Things came to a head in 2018, with India and Maldives putting additional measures in place to issue visas to each other’s citizens.26 India’s Ministry of External Affairs too acknowledges this in its brief on foreign relations in respect of Maldives where it states, “…Except for a brief period between February 2012 to November 2018, relations have been close...”27 This was due to the perceived closeness of the Maldives to China, from India’s standpoint and India interfering in Maldives internal affairs as per the Maldivian standpoint.28 The relations have improved since 2018, after President Solih came into power with emphasis on an ‘India First’ policy.29 The main factors that have led to problems in the India - Maldives relations include:-

  • India’s perceived assertiveness.

  • India’s supposed interference in Maldives internal politics.

  • India’s apparent flexing of economic and military muscle.

  • Maldives playing the China card.

India’s Foreign Policy Gaps

India’s relations with Nepal, Sri Lanka and Maldives can be compared to a ‘sine wave’ in mathematical parlance, with ‘crests & troughs.’ The crests & troughs, though, unlike in a ‘sine wave,’ are not periodic.30 There is a similarity in the likely gaps in the bilateral relations between India and these three South Asian nations, which essentially include: -

  • Perceived assertiveness.

  • Interference in internal politics.

  • Misusing geographic proximity.

  • Economic coercion.

The gaps/ friction points above have led to these countries, and others in the region, being guarded vis-à-vis their relations with India. They are also ‘courting’ extra-regional players to offset India’s influence.

The China Factor

The one common actor, other than India, in India’s neighbourhood is China. According to some analysts, China underestimated India’s stature and rise. This led to minimal friction points between both the countries.31 However, this did not stop China from increasing its investments in South Asia.32 Investments by China are, in most cases, not as transparent as some of the recognised lending institutes. Their investments in Sri Lanka, Maldives and Nepal have come under increased scrutiny in these countries.33,34,35

It is not that India does not provide economic or infrastructure aid. The lines of credit through India’s Export Import Bank alone stand at more than $1.2 Bn each to Nepal, Sri Lanka and Maldives.36 However, the challenge with India’s assistance has been its inability on some occasions to offer development assistance to its neighbours in quick time, lack of strategic engagement and willingness of smaller countries to use China as the bargaining chip for better deals.37 Covid-19, in addition, has made countries in South Asia review their stand vis-à-vis India.

Covid-19

Covid-19 has impacted more than 221 countries and territories around the world, with USA leading and Vanuatu bringing up the rear of the charts. Most countries in South Asia too have been affected.38 The challenge with Covid-19 has been its impact on life, as countries shutdown to stop the spread of the virus. The shutdown led to shutdown of economies, jobs, livelihood and for most, lives. India and its immediate neighbourhood have been severely impacted.

India

India has been one of the worst affected. It continues to battle the challenges of the pandemic. There have been, however, some positives too. India has, during the pandemic, become the world’s second largest producer of Personal Protection Equipment (PPE) kits.39 It is also home to the world’s largest manufacturer of vaccines, the Serum Institute of India Limited.40 In the current situation when countries are resorting to ‘vaccine nationalism,’ India proved to be an exception to the rule by providing vaccines, based on contractual obligations as also grants, to many countries in the region and beyond under ‘Vaccine Maitiri.’41,42 India’s initial response and efforts won it praise around the world, and in South Asia too. Nepal, Sri Lanka and Maldives expressed their gratitude to India for the Covid-19 vaccine delivery. The second wave, however, exposed the underbelly of India’s healthcare system and its inherent limitations. The Covid-19 second wave, provided it can be contained, is not expected to have a substantial impact on the Indian economy.43,44,45,46

Nepal

Nepal has been seriously impacted by Covid-19. There are 455,000 total cases as on May 17, 2021.47 The country is dependent on remittances, tourism and agriculture; all devastated by the pandemic.48 Nepalese working as migrants in the region and beyond have been forced to return home, which will impact remittances and increase joblessness.49

Sri Lanka

Sri Lanka depends to a major extent on Medium, Small and Micro Enterprises (MSMEs) and tourism to sustain its economy.50 With 142,746 reported total cases as on May 17, 2021, Sri Lanka is facing challenges to sustain the economy and its citizens.51 The debt, discussed earlier, is not helping the situation either.

Maldives

Maldives, due to its unique situation as an island nation that is dependent on partner nations for its economic sustenance is expected to have ‘particular and unique impacts’ as per the United Nations.52 The country, as on May 17, 2021 reported a figure of 44,523 total cases.53 Tourism is one of the main contributors to the Maldivian economy.54 Covid-19 has had a direct impact on this.

Impact on South Asia

Covid-19 has brought many challenges in its wake across the globe with health and economy being the most impacted. South Asia, with its developing economies, is no exception to the rule. The common man/ woman has been at the receiving end of this pandemic with no end in sight. Lockdowns, travel restrictions and economic inactivity leading to loss of livelihood have been the norm.

Evolving an Enduring Strategy

India certainly has had challenges in the neighbourhood and continues to have them. However, there are positives too. Dr Constantino Xavier and Riya Sinha of the Centre for Social and Economic Progress in their study of India’s connectivity projects in Nepal, for an article in the Economic Times, have highlighted the cross-border oil product pipeline that was completed 15 months ahead of schedule.55 They have, however, mentioned the need for India to be more proactive and adopt best practices of some credible international agencies to ensure timely completion of projects.56

Sri Lanka needed to increase pace of basic infrastructure, in particular housing, in the war ravaged North and East of the country. In 2010, India stepped forward and offered to build 50,000 houses. Out of these, 48,300 houses have been handed over. The Government of India has announced construction of another 10,000 houses.57

Maldives has been trying to find ways to pay its loans and India has been helping, as brought out earlier, wherein the Exim Bank of India has provided more than $1.2 Billion to Maldives. Whilst these are big ticket projects, it’s the smaller projects that help transform lives of people and help shape opinions. The inauguration of the Ekuveni Running Track in Male is one such project .58

India wishes for a harmonious periphery to ensure unhindered progress. Towards this Nepal, Sri Lanka and Maldives are considered important actors. China, though an external actor, has an enduring presence and is, therefore, an important actor. India has proved, through its response and actions in the challenging times of Covid-19, that it can deliver through timely outreach, despite domestic requirements.

India as also South Asia have fundamental requirements. These, at the macro level, translate into graduating up the income level metrics. Hans Rosling with Ola Rosling and Anna Rosling Ronnlund in their book Factfulness - Ten Reasons We’re Wrong About the World - And Why Things Are Better Than You Think put forth the point that every individual and country likes to move up the income levels.59 The World Bank adopted the Rosling model and classifies countries based on their income levels; low, lower-middle, upper-middle and high-income countries.60 In South Asia, India and Nepal are in the lower-middle income countries group. Sri Lanka, due to Covid-19, has moved from upper-middle to lower-middle income group. Maldives is in the upper-middle group.61

India should reach out to these nations and create a collaborative approach that is mutually beneficial. Based on various challenges that have been faced and those that have been briefly referred to above, India’s enduring strategy to enhance its diplomatic outreach and heft would entail a Whole of Government approach to include: -

  • Evolving a meticulous plan of action, based on local government requirements, with clearly identified timelines.

  • Incorporating best practices, in line with prevalent international norms, in project conceptualisation and execution.

  • Generating capacities to cater for anticipated requirements, both at home and abroad.

  • Ensuring systems work optimally to ensure achievement of targets, if not ahead of targeted timelines.

  • Work quietly, away from media glare, and ensure credit firmly goes to the host nation.

  • Avoid public statements on domestic developments in neighbouring nations, even it if entails being considered as ‘going soft.’

  • Delivering on time on promises made.

  • Focus on projects that have impact for the common people to enhance reputation through word of mouth rather than through media.

  • Identify ‘Red Lines’ that have implications for India’s geo-strategic interests and national security and clearly enunciate them to immediate neighbours. If crossed, initiate punitive measures on the quiet avoiding public posturing.

India inhabits a complex neighbourhood. The presence of extra-regional actors does not help matters. India needs to enhance capacities, deliver on promises and needs to stay away from limelight to enhance convergence in the region and beyond. India’s actions during the intervening period between the Covid-19 waves in the country have proved that she can deliver. India needs to persevere and adhere scrupulously to a strategy that is enduring. India needs to identify, in consultation with countries in the region, sectors and areas that need to be provided due impetus to kick-start economies that have been impacted by Covid-19 and identify agencies that adhere to international norms to provide financial assistance. India’s collaborative approach will help assuage feelings of unease and facilitate all round development and upliftment of people in the region.

Endnotes

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  2. Constantino Xavier, Twitter, 23 December 2020, 6:32 am. https://twitter.com/ConstantinoX/status/1341549693042479106, accessed 03 February 2021.

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  5. Coronavirus Update (Live), Op Cit., n.38.“COVID-19 Pandemic Response: Humanity Needs Leadership and Solidarity to

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