India's Neighborhood First Policy - Features for UPSC

Neighborhood First: Prioritising South Asia and the Indian Ocean with Balance, Speed, and Sensitivity

India’s security and growth depend on a stable, connected, and trusting neighbourhood. “Neighborhood First” aims to deliver development partnerships, connectivity, and crisis response that reassure neighbours while protecting India’s core interests. This note outlines the doctrine, country snapshots, connectivity and energy links, China’s challenge, and what makes neighbourhood policy succeed or fail.

Principles and Strategy

Non-reciprocal goodwill: Rooted in the Gujral Doctrine, India offers asymmetric benefits to smaller neighbours—grants, market access, and quick assistance—without demanding equal return.

Connectivity and integration: Rail/road/water links, power grids, digital payments, and people flows are the backbone of regional integration.

Security reassurance: India positions as a net security provider (HADR, anti-piracy, evacuation, counter-terror), while avoiding overt dominance that fuels suspicion.

China factor: Compete where necessary, cooperate where possible, but prioritise speed, transparency, and local benefit to stay preferred partner.

Country Snapshots

Bangladesh: High point of cooperation. Land Boundary Agreement (2015) resolved enclaves; boundary pillars along most segments; coastal shipping, rail (Maitree/Mitali Express), and power trade (including India–Bhutan hydropower wheeled through India). Cumulative development credit lines are large; trade imbalance persists but value chains (textiles, engineering) deepen. Border management (smuggling, migration) needs constant work.

Bhutan: Hydropower cooperation anchors ties; surplus power flows to India. Bhutan balances its own debt sustainability; India is supporting Sunkosh and new models beyond big dams (distributed renewables, transmission). Security coordination is close; Bhutan–China boundary talks are watched carefully by India.

Nepal: Open border and deep people ties but recurrent political swings. Issues: boundary differences (Kalapani/Lipu Lekh), perceived blockades (2015 crisis) still shape public opinion. Progress: new cross-border transmission lines, power trade to India permitted, petroleum pipelines, and rail links (Jayanagar–Kurtha). Chinese investment interest is rising; India stresses quality and fast delivery.

Sri Lanka: Debt crisis (2022) saw India as first responder (~$4 bn support—fuel, food, credit lines). Ongoing: Trincomalee oil farm redevelopment, renewable projects (Mannar/Pooneryn), connectivity (ferry services, proposed land bridge study), and digital payments (UPI link). Balancing China’s presence (Hambantota lease) with constructive investment and security cooperation remains key.

Maldives: Swings between “India First” and “India Out” rhetoric. India supplies Dornier helicopters, coastal radars, water projects, and budget support; also built the Greater Male Connectivity Project (lines of credit). Current government seeks removal of some Indian personnel; India maintains aid and patience, emphasising community projects and tourism linkage.

Myanmar: Critical for India’s Act East connectivity (Kaladan, IMT highway) and security (insurgency safe havens, border management). Post-2021 coup complicates engagement; humanitarian aid and border security continue, while India balances strategic interests with democratic concerns. China’s influence and projects (Kyaukpyu port) loom large.

Afghanistan: India evacuated missions after 2021 Taliban takeover; continues humanitarian aid (wheat, medicines) via UN channels; engages cautiously on humanitarian grounds while pushing for inclusive governance and counter-terror guarantees.

Pakistan: “Talks and terror cannot go together.” MFN benefits withdrawn; trade paused. Focus shifted to BIMSTEC/IOR platforms; limited engagement on Indus Waters Treaty issues and consular matters. Cross-LOC trade and travel remain suspended; ceasefire along the LoC (2021) has broadly held, reducing firing incidents.

Connectivity and Energy Corridors

• BBIN/rail/road: BBIN motor vehicles framework (Bangladesh-Bhutan-India-Nepal) aims for seamless cargo/passenger movement; progress uneven. Rail links revived with Bangladesh/Nepal; India–Myanmar–Thailand highway still under construction.
• Power grids: India imports hydropower from Bhutan and Nepal; exports power to Bangladesh; regional grid integration expanding with new transmission lines.
• Coastal shipping and ports: Protocol routes with Bangladesh; Chabahar (Iran) provides alternative access to Afghanistan/Central Asia; Sittwe port (Kaladan) links NE India to Bay of Bengal.
• Digital: UPI-based payment linkages and RuPay adoption in neighbours (Bhutan, Nepal, UAE, Mauritius) showcase soft connectivity; scope to extend further.

China’s Offer vs India’s Offer

China’s BRI brings quick capital for large projects but has raised debt, transparency, and sovereignty concerns (e.g., Hambantota lease). India cannot match dollar for dollar; it differentiates on community impact, transparency, and respect for local priorities. Speed of delivery has been a weakness for India—streamlining approvals and execution is essential to stay competitive.

Crisis Response as Influence

Vaccine Maitri during COVID and rapid aid to Sri Lanka established India as first responder. HADR missions (Nepal earthquake, Maldives water crisis, cyclone relief) reinforce credibility. Quick disbursement, not just pledges, is what neighbours value.

Regional Forums: SAARC, BIMSTEC, IORA

SAARC is paralysed by India–Pakistan tensions; summits stalled. India shifts energy to BIMSTEC (Bay of Bengal), IORA (Indian Ocean), and subregional groupings where cooperation is easier. Nepal and Bangladesh welcome BIMSTEC progress; Maldives and Sri Lanka look to IORA/Colombo Security Conclave for maritime security coordination.

Security Cooperation

• Colombo Security Conclave (India, Sri Lanka, Maldives, Mauritius observer Seychelles/Bangladesh): maritime domain awareness, HADR, cyber security.
• Defense training, joint patrols, and equipment grants (coastal radars, patrol vessels, aircraft) build capacity and goodwill.
• Counter-terror and intelligence sharing remain strong with Bangladesh, Sri Lanka, and Maldives; sensitive with Pakistan.

Obstacles and Sensitivities

• Domestic politics in neighbours can swing narratives; India must avoid overt partisanship.
• Implementation delays erode trust (e.g., Kaladan, some LoC projects); faster execution is key.
• Perceptions of big-brother attitude or interference can backfire; communication and local hiring mitigate this.
• Border management: illegal trade, smuggling, migration, and river disputes (Teesta) require steady diplomacy.

Metrics to Track

• Project delivery timelines and utilisation of Indian credit lines.
• Trade volumes and balance with each neighbour; share of power/digital connectivity achieved.
• HADR/aid disbursement speed during crises.
• Chinese project pipeline and debt exposure in each neighbour; how India positions alternatives.

Takeaway: Neighborhood First succeeds when India delivers quickly, listens to local priorities, and keeps security cooperation credible without heavy-handedness. Development partnerships, connectivity, and swift crisis support are the best antidotes to external influence. Balancing firmness on core concerns (terror, sovereignty) with generosity and respect will shape whether the neighbourhood sees India as a partner of choice.

SAGAR and the Indian Ocean

Security and Growth for All in the Region (SAGAR) frames India’s maritime outlook—HADR, maritime domain awareness, capacity building, and respect for international law/UNCLOS. Coastal radar chains, information fusion centres (IFC-IOR), and joint patrols with island states enhance awareness. Assistance during cyclones and evacuations (e.g., Yemen, Ukraine evacuation staging via neighbours) reinforces India’s role as first responder.

Country Details (continued)

Maldives (deeper dive): Greater Male Connectivity Project (funded by Indian LOC) is the largest infrastructure project there. Community projects (fisheries harbours, water/sanitation) are well received. Managing perceptions around defence personnel and helicopter deployment is crucial to avoid “India Out” campaigns gaining traction.

Nepal (more detail): Hydropower exports to India now permitted under certain conditions; large projects (Arun-III by Indian firm) progressing. Fast clearance of power purchase agreements and transmission lines can turn Nepal into a clean power exporter. Inland waterways access via India to seaports remains an ask.

Bangladesh (more detail): Joint rivers management (Teesta unresolved), border fencing completion, and shared migration management remain sensitive. CEPA (Comprehensive Economic Partnership Agreement) is being explored to deepen trade/value chains.

Sri Lanka (more detail): Debt restructuring includes India as an official creditor; emphasis on transparent, comparable treatment. Renewables and logistics projects (Kankesanthurai port) and cultural links (Buddhist tourism circuits, Jaffna flights) are part of soft power.

Bhutan (more detail): Transition to higher-income status needs diversification; India can support digital, tourism, and climate-resilient infrastructure alongside hydropower.

Myanmar (more detail): Insurgencies in India’s Northeast and refugee flows link internal security to Myanmar stability. Balancing humanitarian principles with infrastructure continuity (Kaladan/IMT) is tricky; delays give space to Chinese projects.

Economics and Trade Architecture

• SAFTA under SAARC exists but political blocks limit progress; many tariffs reduced, but non-tariff barriers and logistics still hinder trade.
• India offers duty-free/quota-free access to LDC neighbours; rules-of-origin enforcement aims to prevent diversion.
• Local currency trade pilots (e.g., with Sri Lanka) could reduce forex stress; success depends on convertibility and trust.

Water, Environment, and Climate

Many neighbours share rivers with India (Ganga-Brahmaputra-Meghna basin). Flood forecasting data sharing with Bangladesh/Nepal reduces disaster risk. Joint river commissions need revitalisation to address silt, embankments, and climate-driven variability. Coastal and island states seek support on erosion, salinity, and coral/mangrove protection; India’s own coastal programmes can be shared as templates.

Domestic Delivery and Perception

Implementation lags (ports/roads/power lines) have hurt credibility. Streamlining clearances, empowering missions with faster financial approvals, and using local contractors/consultations can speed delivery and improve ownership. Scholarships, cultural exchanges, and media engagement counter negative narratives and build long-term goodwill.

China–India Dynamics in the Neighbourhood

Neighbours hedge: they welcome Chinese capital and Indian markets/security. India must avoid zero-sum framing, instead offer viable, timely alternatives and collaborate where interests align (e.g., with multilateral banks). Surveillance over dual-use projects and debt sustainability analyses remain important for risk management.

Metrics of Success for Neighborhood First

• Time from announcement to completion of projects.
• Share of regional power and transport links operational under open access regimes.
• Public sentiment and tourism/study flows as proxies for goodwill.
• Reduction in crisis response time and volume of aid delivered.
• Level of Chinese security footprint (military presence, long-term leases) vs Indian development footprint.

Future Moves

• Finalize Teesta and other river agreements with safeguards; expand flood forecasting cooperation.
• Scale cross-border electricity trade and green grids; position the region as a clean-power hub.
• Digitally connect payment systems and customs to cut friction; expand UPI/RuPay interoperability.
• Prioritise project execution units with joint India–neighbour teams to reduce delays.
• Keep politics out of development delivery; focus on community-level wins that survive electoral cycles.

Pakistan and Outstanding Issues

India’s red line is terror; cross-border attacks (Pathankot, Uri, Pulwama) froze dialogue and led to surgical and air strikes. Trade is suspended; MFN revoked; SAARC stalled. The Indus Waters Treaty (1960) endures; India is upgrading hydropower within treaty limits. A stable LoC ceasefire since 2021 reduces firing casualties but mistrust is deep. Any opening will likely be incremental and contingent on terror restraint.

North-East Integration and Act East

Connectivity to neighbours also integrates India’s Northeast. Better roads, rail, and river links to Bangladesh reduce the Siliguri Corridor’s vulnerability and cut logistics costs. Act East hinges on Myanmar stability; delays there hurt NE economic prospects. Ensuring local communities benefit from border trade and infrastructure reduces insurgency incentives.

Migration, Border Management, and People Flows

Open border with Nepal and long land borders with Bangladesh make movement easy. Managing illegal migration, smuggling, and human trafficking requires joint patrolling, smart fencing where needed, and legal pathways for trade and labour. Cultural and educational exchanges can soften perceptions; visa facilitation for students/business travellers signals openness. Tourism circuits (Buddhist/Ramayana) extend soft power and shared heritage.

Data to Refresh

• Value and utilisation of Indian lines of credit by country.
• Power trade volumes (imports from Bhutan/Nepal; exports to Bangladesh/Nepal).
• Major connectivity milestones commissioned (bridges, rail links, ports, ferries).
• Debt indicators for neighbours vis-à-vis China and others; India’s share of assistance.
• Trade balances and top items with each neighbour.

Concluding Note

Neighborhood First is less about grand declarations and more about steady, visible delivery: moving goods faster, lights staying on, water flowing, and timely help in crises. If India pairs humility with speed and keeps security concerns firm but fair, the neighbourhood is more likely to see India as an indispensable partner rather than a domineering one.