Changing Contours of India’s Neighbourhood First Policy

Anurag Dwivedi
10 min readApr 29, 2022

Introduction

India considers itself a South Asian superpower. In terms of population, area, military might, and economic strength, it is unarguably the biggest country in the region. In this era of changing global realities, South Asia is also being affected by geopolitical events worldwide, and India has to find a way to establish itself as a powerful but friendly and enlightened neighbour. India has many challenges in this regard-China’s growing clout in the region by means of investment and giving debt, long-standing unsettled border issues with two giant neighbours, China and Pakistan, conflicting interests of other big powers in the Indian subcontinent region, and the distrust of small neighbours in India primarily because of its vast size and economic might.

In my opinion, India’s relations with its neighbours can be studied in two phases: Pre-2014 and Post-2014. It was 2014 when the 15th Prime Minister of India, Shri Narendra Modi, started following the ‘Neighbourhood Policy’, as some call it, rigorously (India’sNeighborhood_First_Policy.Pdf). Close historical, ethnic, religious, economic, and linguistic ties influence any country’s relationship with its neighbour. India is no exception, and it has historical ties with almost all its neighbours. These ties help improve bilateral trust, shared values and beliefs. Despite this fact, India has not been successful in maintaining a cordial relationship with all its neighbours at a time. In this context, it becomes essential to look at the history of India’s relations with its neighbours before studying the current status of the relations in the neighbourhood.

Pre-2014 India’s Neighborhood Diplomacy

Post-independence Prime Minister (PM) and then Foreign Minister (FM) Jawahar Lal Nehru (1946–64) laid the groundwork of India’s foreign policy, and many of the policy ideas from that era are still ingrained in India’s current foreign policy choices. Neighbourhood diplomacy took a back seat in his quest to seek international cooperation and world peace on the global stage (History_neighbourhood_diplomacy.Pdf). Though India enjoyed an out of proportions prestige and exercised influence in world matters compared to its size and economic power, it could not focus on the immediate regional concern. It was Lal Bahadur Shashtri (1964–66) who took note of India’s neighbourhood in the backdrop of hostile relations with our two big neighbours and sent his FM to Burma (now Myanmar), Nepal, Ceylon (now Sri Lanka), Afghanistan and other neighbouring countries to infuse fresh energy into our bilateral relations. Indira Gandhi (1966–77) further worked towards restoring peaceful relations with the immediate neighbours and at the same time showcasing the dominance of India in the South Asian region. The creation of Bangladesh in 1971 is an apt example of this. India’s military intervention to liberate East Pakistan from West Pakistan and then normalizing relations with Pakistan following the Simla Agreement, 1972, highlights her pragmatism. It was during her reign only when India tried to mend its relations with China in 1976 and also strengthened its sea-zone pacts with Sri Lanka and Indonesia.

During the short two years period of Morarji Desai’s prime ministership (1977–79), developing closer relationships in the neighbourhood was on the top of the agenda. The growing fear of interference among small neighbours and thereby induced suspicion and misunderstanding needed to be addressed at the earliest. This was also the need of the hour as India was producing agricultural surpluses and needed markets for export. These concerns were not just reflected in the government’s outreach to these countries but also in the actions to consolidate its position on seeking close bilateral relations. The issue with Pakistan on Salal Dam in Kashmir was addressed, and concessions were given to Nepal and Bangladesh to reach an understanding. However, during the second term of Indira Gandhi (1980–84), India seemed to be high-handed in her dealings with the neighbours and relations turned sour.

Rajiv Gandhi (1984–89) continued the efforts of his predecessor to repair the relations with neighbours and also pursued the agenda of common development of the South Asian region. He also worked hard on thawing the relations with China that were in the worst state after the 1962 war. The traditional way of practising foreign policy got a new direction in the Narsimha Rao’s stewardship (1991–96) in the wake of economic liberalization and changed economic realities for India. India’s closeness with the US increased, and its status rose globally, most notably in the region. His successor Deva Gowda (1996–97) put forth Gujral Doctrine. It has provisions for making unilateral concessions to neighbours without any expectation for reciprocity in order to take the bilateral relations to a new level. Atal Bihari Vajpayee (1998–2004) laid particular emphasis on improving relations with neighbours along with promoting closer regional relations through SAARC (South Asian Association for Regional Cooperation). Starting a bus service between Delhi and Lahore in February 1999, consolidating friendly ties with our most trusted neighbour Bhutan, working with Bangladesh authorities to check illegal infiltration from there, enhancing defence, cultural and economic cooperation were some of the highlights from his neighbourhood outreach initiatives.

The first decade of the 21st century was a decade of unprecedented geopolitical change. India and China both had emerged as large economies, China’s influence at the global stage was rising at a fast pace, the world has moved from a bipolar regime after the end of the cold war and was now witnessing the emergence of a multi-polar regime. Under the stewardship of Manmohan Singh (2004–2014), India fostered relations with Japan and the South-East Asian Nations. India-U.S. bilateral relations were stronger than ever. However, on the neighbourhood diplomacy front, there is not much to its credit. India could not improve relations with China, the status-quo in Aksai Chin and Arunachal Pradesh was not re-established. The administration also could not get over a dialogue with Pakistan to resolve cross-border terrorism.

‘Neighbourhood First’ Policy (Post 2014)

Post-2014, after Narendra Modi took charge of prime ministership, his focus towards India’s neighbourhood was visible from Day 1. In a first of its kind initiative, PM Modi invited heads of all SAARC nations and Mauritius to attend his swearing-in ceremony on May 26, 2014. He chose Bhutan as the destination of his first foreign trip as PM. When he visited Kathmandu to attend a bilateral meet, this India’s PM visit came after a hiatus of 17 years. His foreign minister, Sushma Swaraj, also chose Bangladesh as the destination of her first official visit to a foreign country. All this suggested that his ‘Neighbourhood First Policy’ was much more than just talks. India was ready to go the extra mile to foster friendly relations with its neighbours.

India’s gesture to mend ties with Pakistan could not last long. Though Pak PM Nawaz Sharif attended Modi’sswearing-in ceremony and their meeting in Russia’s Ufa city led to the resumption of the India-Pak Dialogue process, the relations took a wrong turn in January 2016. Pakistan based Jaish-e-Mohammed (JEM) terror group launched an attack on Pathankot airbase in Punjab. Uri attacks in September and then governments’ decision to withdraw their diplomats seemed to be the last nail in the coffin of diplomatic ties between these two countries. In the last one year, the two South Asian rivals have again attempted to conduct back-channel talks and resolve the outstanding disputes. A positive outcome of these talks is a ceasefire agreement signed by military commanders from the two sides. The trade ties between the two countries have gone to a new low, and there seems to be no hope for an overturn in trade in the near future. China’s growing closeness with Pakistan and Russia and their enhanced defence cooperation are matters of concern for India. India-Pakistan relations are also quite crucial for the economic development and peace in the region. Owing to India-Pakistan rivalry amid other reasons, there has been no SAARC meeting after 2014 making it the least integrated regional grouping in the world.

Importance of Regional Groupings

The administration understands well that it is in India’s overall security interests to have an economically integrated region. Given that SAARC’s performance has been less than satisfactory and it has failed to deliver on regional cooperation along with pursuing ‘Act East Policy’, Indian focus has diverted to BIMSTEC (Bay of Bengal Initiative for Multi-sectoral Technical and Economic Cooperation) in the Bay of Bengal region comprising of five countries from South Asia and two from South-East Asia (Raghuramapatruni). India is the lead for tourism, environment and disaster management, counter-terrorism and transportation and communication sub-sectors under BIMSTEC. India has the potential to lead in all these sectors, and if it manages to deliver on these subsectors, BIMSTEC can prove to be a vehicle of transformation in this region. If BIMSTEC can be utilized by the member countries for dispute resolution as well, this grouping will emerge as a sustainable platform for regional cooperation. The exclusion of Pakistan from this grouping has both positive and negative aspects. On one front, Ind-Pak rivalry will not be at play in this grouping resulting in smooth conduction of its activities, but on the other front, Indian diplomats have one less regional platform to have a dialogue with their Pakistani counterparts. India needs to sideline its differences with Pakistan and work with other countries to revive SAARC to foster regional cooperation and ensure the peaceful existence of everyone in the region. The regime change in Afghanistan with the alleged help given to the Taliban by the Pakistani establishment has further tensed the diplomatic ties.

India’s Bilateral Relations with Old Friends in the Neighbourhood

India has close religious, ethnic and historical ties with Nepal, Bhutan and Sri Lanka. The first two share land borders with India, and the last one shares sea borders with India. India has maintained cordial relations with Bhutan for many years now. Soon after independence, India signed a friendship treaty with Bhutan in 1949, revised in February 2007 (Taneja and Roy). Modi’s first visit as PM to Bhutan and also during the first phase of his trips after swearing-in as PM for the second time in 2019 has shown how much importance his government is giving to this neighbour. These visits served well to the Neighbourhood First policy and further cemented the bilateral cooperation. This was also crucial for the perception management in South Asia as India has long been perceived as a ‘Big-brother Hegemon’ in the region by small neighbouring countries. India has signed multiple MoUs with Bhutan in diverse fields in the last seven years, including education, disaster management, space cooperation and hydropower cooperation. India needs to sustain this diplomatic outreach to Bhutan in order to find more areas of cooperation in the coming days.

India enjoys historical relations with Sri Lanka that are more than 2500 years old. In recent years, India’s investment in Sri Lanka has grown, trade is on an upward trajectory, high-level visits have occurred, and areas of convergence have been explored. At the same time, China has also been expanded its footprint in Sri Lanka by funding many infrastructure projects and lending money. Recently Indian ties with Sri Lanka were strained after the Sri Lankan Government decided to cancel an MoU with Japan and India to jointly develop the East Container Terminal (ECT) at Colombo Port. Slow progress in the number of ongoing Indian projects in Sri Lanka and quick clearance of Chinese projects have also been matters for the displeasure of the Indian diplomatic circle. Foreign Secretary made a four-day visit to Sri Lanka in early October this year to reset the strained ties and also bolster the energy ties.

Since time immemorial, India has warm and friendly ties with its land-locked neighbour Nepal marked by close borders and deep-rooted people-to-people contact. India-Nepal Treaty of Peace and Friendship of 1950 is the bedrock of this close cooperation between the two countries (Author and K). PM Modi has visited Nepal four times post 2014, and this reflects India’s commitment towards Neighborhood first policy and also highlights Nepal’s position in India’s strategic consideration. Bilateral ties turned sour in 2020 when Nepal published new official maps which included areas India considers under its territory. However, high-level visits from the Indian side have re-opened the communication channels between India and Nepal again. Besides people-to-people contact, robust government-to-government contact needs to be maintained to avoid such friction scenarios.

India has also maintained good neighbourly relations with Bangladesh since its liberation in 1971 (Obhan). PM Modi’s visit to Bangladesh on the 50th Anniversary of its independence as a chief guest was a turning point in the bilateral relations after friction on the Citizenship Amendment Act (CAA) and National Register of Citizens (NRC) and water sharing. Both countries have engaged over connectivity projects and sought cooperation in inland water trade and transit and also over COVID-19 vaccines.

India’s issues with China

India- China relationship is at a crossroads post Galwan clash in 2020, and its direction is still uncertain. Sharp exchanges of words over border issues have become a common occurrence. Since Indian independence, India and China have border issues, and we have still not found a permanent solution to it. Despite border issues, India-China economic relations have grown. China is now India’s one of the largest trade partners (Fundamentals and Future). Phenomenal success has been achieved on the multi-sectoral cooperation front. The perception about each other on both sides have not changed, and this is one of the major roadblocks to a friendly relationship between the countries. Apart from that, China’s expansionist behaviour, high-handedness while dealing with neighbours and quest to increase its influence by its massive Belt and Road Initiative (BRI) still hinder India’s efforts towards resetting ties.

The way ahead

India is in a unique position today when it comes to neighbourhood diplomacy. Barring China and Pakistan, it has managed to maintain a warm and cordial relationship with its other neighbours. Despite the challenges, India’s diplomatic outreach and continued efforts to find areas of convergence with neighbours have yielded promising results. Given the changed geopolitical situation in the region, it is now more important than ever to restore and maintain good ties with historical friends, work on perception management, and seek cooperation with Pakistan and China in select areas. China’s increasing political clout in South Asia and efforts to balance India’s influence in the region are India’s diplomats’ most significant hurdles. India has taken steps to counter China’s growing influence by adopting neighbourhood first policy and pushing economic integration among South Asian countries through other platforms. This is a changing world and India has to continuously evolve its foreign policy to seek peace and prosperity in the region and ensure good ties with neighbours.

References:

Author, Corresponding, and Kavitha K. K. “The Changing Paradigm of India-Nepal Relations: Problems and Prospects.” Quest Journals Journal of Research in Business and Management, vol. 4, no. 5, 2016, pp. 10–15, www.questjournals.org.

Fundamentals, Strong, and Bright Future. China-India Bilateral Trade : China-India Bilateral Trade : no. december 2005, 2016.

History_neighbourhood_diplomacy.Pdf.

India’sNeighborhood_First_Policy.Pdf.

Obhan, Guntash. India ’ s Neighbourhood First Policy in the Backdrop of CAA-NRC : Effect on India-Bangladesh Ties in a Globalizing World. no. 2, pp. 637–47.

Raghuramapatruni, Radha. “India’s Trade with the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic-Cooperation (BIMSTEC) — A Study.” International Journal of Management Studies, vol. V, no. Special Issue 5, 2018, p. 67, doi:10.18843/ijms/v5is5/10.

Taneja, Nisha, and Riya Roy. Working Paper 384 India-Bhutan Economic Relations. no. August, 2019.

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Anurag Dwivedi

Policy Enthusiast | IITK’20 | Fellow, CPL’21 | Youth Leader, UNCTAD Youth Forum | IIGL’21 | Engineer, Applied Materials