Grading India’s Neighborhood Diplomacy

By Vinay Kaura (31 December 2017) – Indian Prime Minister Narendra Modi’s charismatic personality and determined push for India’s economic development have made him immensely popular at home. Modi’s foreign policy initiatives are driven as much by his government’s domestic political strength as by India’s rising concern over rapid expansion of China’s economic clout and military might in Asia.

India’s rise is taking place in the shadow of China’s even more dramatic rise. China’s assertive, and often aggressive, behavior has been viewed as a huge challenge for India because it opens up the likelihood of China dominating India’s immediate neighborhood. By focusing a great deal of energy in the neighborhood, the Modi government is demonstrating that India has the capability to promote regional peace and economic integration. Rather than merely complaining about external intervention in South Asia, New Delhi is developing a regional strategy based on India’s natural geographical advantages, economic complementarities, shared cultural heritage, and preeminent strategic position. Modi is perfectly aware that New Delhi’s ability to deal with Washington and Beijing can be significantly enhanced if India achieves greater strategic confidence in South Asian geopolitics.

The “neighborhood first” policy is the striking feature of Modi government’s diplomatic approach. In his government’s strategic imagination, India’s relations with neighboring countries must receive topmost priority. If India does not resolve its differences with its small neighbors, it will only pave the way for China to exert growing influence in the region.

Enjoying this article? Click here to subscribe for full access. Just $5 a month.

Modi often projects himself as an innovative and decisive leader who could make things happen. True to his style, he began his term as prime minister with a diplomatic first by inviting the leaders from the South Asian subcontinent to attend his inauguration in May 2014. After his first two years in office, Modi had already traveled to almost all of India’s neighbors in an attempt to establish India as a dominant regional power. His successful visits to South Asian capitals indicated that finally India had a leader for whom “neighborhood first” was not mere political rhetoric but a strategic necessity.

Sri Lanka

Sri Lanka has long been in India’s geopolitical orbit, but its relationship with China has strengthened in recent years. As Western countries accused former President Mahinda Rajapaksa of gross human rights violations during the final stages of the civil war with LTTE, China extended billions of dollars of loans to the Sri Lankan government for new infrastructure projects, though these loans turned out to be economically unviable for the island nation.

In February 2015, Sri Lanka’s newly elected President Maithripala Sirisena undertook his first official visit to India, and Modi paid a return visit to Colombo in March 2015. He was the first Indian prime minister to do a stand-alone visit to Sri Lanka in 28 years. While there, Modi not only addressed the Sri Lankan parliament but also made a trip to the northern province of Jaffna. Modi visited Sri Lanka again in May 2017, when he inaugurated a specialty hospital built with Indian assistance and visited the Indian-origin Tamil community there.

Just ahead of China’s Belt and Road Initiative (BRI) summit in May 2017, Colombo refused to allow a Chinese submarine to dock. Under the previous dispensation, Sri Lanka had allowed a Chinese submarine to dock at the Colombo port, drawing protests from India. But Sri Lanka also sent its Prime Minister Ranil Wickremeshinghe to the Belt and Road summit, and was offered an estimated $24 billion in additional loans.

In early December, Sri Lanka handed over the strategic port of Hambantota, which is expected to play a key role in China’s BRI, to China on a 99-year lease. The opposition parties and trade unions in Sri Lanka have already dubbed the port deal as a sellout of their country’s national assets to China. It must be noted that Sri Lanka is struggling to pay back its existing $8 billion debt to China. Many critics feel that the lease could set a precedent for other small South Asian countries that owe money to China to accept deals that involve surrendering a part of their territory. In order to allay Indian concerns that the Hambantota port will not be used for military purposes, the Sri Lankan government has sought to limit China’s role to running commercial operations at the port while it retains oversight of security operations.

Beset by China’s offensive in its strategic backyard, the Modi government is determined to improve its ties with Colombo. Modi’s second visit to Sri Lanka in May this year was primarily aimed at reinforcing traditional ties at a time when China has been aggressively seeking to make inroads in the Indian Ocean region. Similarly, Wickremesinghe visited India in September 2015, his first overseas visit after being appointed as Sri Lankan prime minister. He has been a frequent visitor since. India is also likely to invest in Mattala airport in Hambantota district. It is hoped that India’s presence at the airport, which is just 30 kilometers away from the Chinese-operated port of Hambantota, will help New Delhi to monitor Beijing’s growing presence in Sri Lanka.


Maldives is one South Asian country that Modi has not visited since taking office. Although it was on the itinerary for his March 2015 Indian Ocean tour, the visit had to be canceled due to domestic political turbulence in Maldives. However, Maldivian President Abdulla Yameen visited India in April 2016 and the two countries signed agreements in the fields of defense, taxation, tourism, conservation of mosques, and space research.

India’s ties with Maldives have been impacted by China’s growing footprint on the island. China opened an embassy in Male, the Maldivian capital, only in 2011. Many countries have non-resident embassies either in New Delhi or Colombo; the Chinese embassy in Colombo took care of Maldivian affairs until 2011.

In early December, Maldives rushed a much-criticized Free Trade Agreement (FTA) with China through the Maldivian parliament at midnight, without any opposition members present. This is Maldives’s first FTA with any country, and also China’s second with any country in South Asia, after Pakistan. The manner in which China managed to secure this FTA is nothing short of a diplomatic coup by Beijing. On the sidelines of the FTA agreement, Yameen pledged full backing for China’s Maritime Silk Road (MSR), which is part of the BRI. Given its security impact in India’s strategic backyard, China’s foray into Maldives has already aroused concerns in New Delhi.

Following the unexpected FTA deal between Maldives and China, India’s foreign ministry issued a statement saying it is India’s “expectation that as a close and friendly neighbour, Maldives will be sensitive to our concerns, in keeping with its ‘India First’ policy.” Rather than allaying India’s concerns, the Maldivian government took the drastic step of suspending three local councillors for meeting with the Indian ambassador without seeking prior permission. In the past, Maldives would not have dared snub India in such a manner.


Modi’s initial outreach to Nepal in 2014 managed to strike the right chord, and captured the imagination of people and policymakers in Nepal. After the devastating earthquake caused great havoc in Nepal in 2015, India carried out extensive rescue operations and extended much-needed financial assistance for post-earthquake reconstruction projects.

However, things began to take an ugly turn when Nepal announced a new constitution, which, according to critics, disadvantaged ethnic groups such as the Madhesi people in the country’s Terai region. Consequently, Madhesi protesters’ blockade stopped all essential supplies from India from reaching Nepal and created a humanitarian crisis. Kathmandu blamed New Delhi for being complicit in an unofficial economic blockade and began to play the “China card” to balance India’s immense power over Nepal. In May 2016, the Nepali government went to the extent of cancelling the visit of the country’s President Bidhya Devi Bhandari to India and recalling its ambassador in New Delhi. This radical step was symbolic of the frosty relationship between the two countries.

The recent victory of the left coalition in Nepal’s parliamentary elections is expected to pose several challenges for the Modi government. Due to inconsistent policies and conflicting priorities from New Delhi as well as the emergence of a new crop of politicians and opinion makers in Nepal, India’s leverage in Nepal’s internal politics has shrunk to its lowest level. China is more than willing to fill this vacuum. Kathmandu has already signed on to the BRI plan, which is likely to cement China’s communication links with Nepal. It may be reasonable to argue that Nepal would prefer China’s model of economic engagement without political dictation to Modi’s “neighborhood first” policy.


On the way back from Afghanistan in December 2015, Modi paid a surprise visit to Pakistan, where he held a meeting with his Pakistani counterpart, Nawaz Sharif, in Lahore. The move sparked a great deal of enthusiasm in public opinion, but later proved to have little real impact on improving ties between the two nuclear neighbors. Since the Pathankot terror attack and the invitation for Pakistan’s intelligence officials to join an investigation into the attack, the bilateral relationship has hit a dead end. The talks between India’s National Security Advisor Ajit Doval and his Pakistani counterpart, Naseer Khan Janjua, have stopped. Frequent violations of the ceasefire along the Line of Control have also contributed to the failure of talks. In fact, relations are perhaps the worst they have been since the 2008 Mumbai terror attacks.

The Modi government’s policy of diplomatically isolating Pakistan does not seem to be succeeding as Islamabad has stepped up its diplomatic efforts to engage Beijing, Moscow, and Tehran. Escalation of hostilities also inadvertently helps in reinforcing Pakistan’s narrative that India-Pakistan relations are facing a deadlock, which can only be removed if big powers intervene. New Delhi has always resisted international intervention in the bilateral dispute.

Moreover, Modi, during a recent election campaign, cast aspersions on a private dinner hosted for a visiting former foreign minister from Pakistan by Congress leader Mani Shankar Aiyar and attended by former Prime Minister Manmohan Singh along with retired Indian diplomats. In this climate, the risks of losing valuable intellectual and constructive inputs into the making of Modi government’s Pakistan policy are real. One cannot dispute the fact that India’s external affairs ministry is not the only source of wisdom on foreign policy, and such politically motivated allegations can destroy creativity in framing strategic thought vis-à-vis Indo-Pak relations.


Afghanistan is a real success story of Modi government’s neighborhood policy. Afghanistan underwent a change in its political leadership when Ashraf Ghani was elected president in September 2014. Ghani came to India for his first official visit in April 2015. Modi’s first Afghan visit came in December 2015, during which he inaugurated the Afghan Parliament building that was constructed with Indian assistance. In June 2016, Modi made another trip to Afghanistan and inaugurated Salma Dam in Herat, proclaiming that “Your friendship is our honor; your dreams are our duty.” India’s assistance for reconstruction and development in Afghanistan stands at $2 billion, making New Delhi the biggest donor among regional countries.

Ghani has been extremely eager to reduce landlocked Afghanistan’s reliance on Pakistani territory for trade and to corrode Pakistan’s undesirable influence over Afghan affairs by improving ties to India. New Delhi and Kabul have decided to improve transport connectivity through Iran’s strategically located Chabahar port, which is likely to ramp up trade between India, Afghanistan, and Iran in the wake of Islamabad denying New Delhi transit access for trade between the two countries. Ghani has even gone to the extent of threatening Islamabad that Afghanistan would block Pakistan’s access to Central Asia if Afghanistan is not permitted to trade with India via Wagah-Attari.

By reaching through Afghanistan into Central Asia’s road and railway network, India has the potential to shape events as a counterweight to Pakistani and Chinese influence. The first phase of Chabahar port has been recently inaugurated by Iranian President Hassan Rouhani. This important milestone in India’s foreign policy came after the first consignment of wheat from India was sent to Afghanistan through Chabahar in October.

In view of Pakistan denying access through its territory, India and Afghanistan have also launched an air freight corridor in June this year. The decision to establish an air cargo route was taken in December 2016 when Modi met Ghani ahead of the Heart of Asia Conference held in Amritsar. Besides giving a boost to bilateral trade, the air corridor is also expected to help Afghan students seeking to pursue studies and patients seeking treatment in India. Growing convergence between India and the United States on resolving the Afghan conflict, as reflected in the Trump administration’s recently announced South Asia policy, is another shot in the Modi government’s diplomatic arm.


The real benefit for India of “neighborhood first” approach is that Bangladesh has provided great strategic opportunity to change South Asia’s geopolitical situation. In July 2014, New Delhi and Dhaka accepted the judgment of International Tribunal for the Law of the Sea and settled a long-standing maritime order dispute. In June 2015, when Modi visited Bangladesh, the two countries exchanged the instruments of ratification on the historic land boundary agreement. In April this year, Prime Minister Sheikh Hasina visited India, during which India announced a new credit line of $4.5 billion with an additional $500 million for Bangladesh’s defense hardware purchase.

Bangladesh continues to be bright spot for India’s neighborhood, policy despite attempts by pro-Pakistan radical groups and ISI-sponsored elements to derail the flourishing bilateral relationship. Bangladesh is now at the forefront of India’s counterterror strategy. Bangladesh has emerged as a key gateway for India’s sub-regional initiatives, the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) and the Bangladesh-Bhutan-India-Nepal (BBIN) initiative. Showcasing ties with Bangladesh as a testimony to India’s official policy of “neighborhood first,” India’s Foreign Secretary S. Jaishankar has rightly said that “If there is one example where the neighborhood first policy has yielded good result, it is in case of Bangladesh.”

Despite growing bonhomie, the long-standing deal on the sharing of waters of the Teesta River is yet to be signed between the two countries. While New Delhi and Dhaka have been on the same page, the proposed deal has become hostage to West Bengal Chief Minister Mamata Banerjee’s reservations. As general elections are due in Bangladesh in December 2018, the Hasina government would try to push the Teesta deal to deny the opposition parties a chance to play the anti-India card. In order to brighten the electoral prospects of the India-friendly Hasina regime, the Modi government must expedite the deal making process on Teesta.

Countering China’s Push

China has embarked on a series of infrastructure development projects, most as part of its BRI, which many strategic experts fear can leave India isolated regionally and encircled by Chinese allies. India has serious apprehensions over growing ties between China and Pakistan, which are seen as compromising India’s national security. There is widespread concern in India’s policymaking circles of Beijing’s expanding presence in Pakistan and Nepal and now in Maldives. China’s relentless attempts to establish formal engagement with Bhutan has also highlighted Beijing’s aggressive posturing.

There are many reasons behind China’s ability to move much faster than India, including an authoritarian one-party governing structure that gives President Xi Jinping decision-making power far beyond what Modi is able to command. Besides the fact that Indian economy is only a fifth of China’s in size, India suffers key institutional constraints, including a notoriously slow and cumbersome bureaucracy. Hence, it is no surprise that India has been struggling to compete with China across different regions, where many nations are now economically dependent on China.

Despite this, Modi’s achievements in South Asia have been significant, if not exceptional. Some of his initiatives have admittedly fallen short, but they do not taint his larger record. The “neighborhood first” policy has seen some intense engagements with neighbors that are a high point of Indian foreign policy in recent decades. Yet these relationships need constant nurturing amid China’s relentless expansionism. As China has deeply entrenched its economic and strategic footprints in South Asia, the Modi government has a long road ahead of it to try to bolster India’s regional leadership.

Vinay Kaura, Ph.D., is an Assistant Professor at the Department of International Affairs and Security Studies, Sardar Patel University of Police, Security and Criminal Justice, Rajasthan. He is also the Coordinator at the Centre for Peace and Conflict Studies in Jaipur. The article first appeared in  The Diplomat.


Comment Here