Tuesday, August 2, 2011

India and its near neighbours

Six Decades and counting

After sixty four years and five wars, India is yet to sort a single dispute with its neighbours. On the contrary it has got itself into uncomfortable situation in the past. Be it the peacekeeping forces in Sri Lanka or constant meddling in the internal affairs of Nepal. Relationships with the neighbours are anything but cordial.

In 1971, India championed the cause of Bangladesh and helped carve a new country in South Asia. The first government of Bangladesh lead by Sheikh Mujibur Rehman looked all set to enter into a long lasting friendship with Mrs Gandhi. The dream met a premature end with the coup in 1975, which wiped out most of Bangladesh’s first family. India hardly took a second look at Bangladesh after that. With India getting more and more obsessed with its western neighbour Pakistan in the past few decades, there was hardly any attention paid to rest of neighbourhood.

India’s issues with Pakistan are deep rooted and extremely sensitive with its political class. It can be safely assumed that all the issues with Pakistan (including Kashmir) can not be resolved overnight or even in the medium term. However, this should not distract the attention of Ministry of External Affairs from its near neighbours. Pakistan is and will be an ongoing affair for a long time to come. India should spare some energy and resources to mend its ties with countries which can prove to be long term partners in regional cooperation.

What can we do?

Handing out aid is not a guarantee to good relations. Had it been the case, America should have been the world’s best friend. Secondly India can not afford to offer aid on a large scale, given the fact that there is a pressing need for social development with in the country. Under such circumstances the best way forward is to engage in increased business activity. And for once, these business activities should move beyond exchanging a few truck loads of onion and sugar, which only helps a handful of people that too for an extremely short period of time.

The long term strategy for India should be to establish business relations with countries like Bangladesh, Sri Lanka and Nepal on a larger scale. Bangladesh after a long time has a friendly government in power. Civil war in Sri Lanka has come to an end and Nepal will sooner or later have a full time prime minister. Given these favourable situations India should push for large scale contribution to these countries in form of setting up manufacturing facilities and some kind of secondary outsourcing (which some big Indian companies already are doing with South East Asian countries).

India should look for incentives for its private sector companies from sectors like two wheelers, pharmaceuticals, FMCG, BPOs, etc to set shop in countries like Bangladesh, Sri Lanka and Nepal. This will prove to be a win all situation for the countries. The local population will benefit from employment generated at the manufacturing unit, the economy will benefit from the money pumped in, the parent company will benefit from incentives and possible relaxation in export rules to foreign markets (Bangladesh gets substantial tariff exemption for its textile export to Europe).

Economic and trade connection will inevitably bring in more people to people contact, which in turn will help reduce the trust deficit. All three countries mentioned share very close cultural, linguistic and religious bonds with India. A little push on the economic front can change the way South Asians see each other. But before India does any of this, it should raise the profile of the ministry of external affairs.