The case of Himalayan handshake and indispensable partnership

India engaged with the world’s second and third largest economies over the past two weeks. The Chinese premier Li Keqiang made his first stop in India on his four nation itinerary. The visit happened weeks after Chinese military pitched tents 19 km inside Indian territory in early April. The incident attracted international attention and set rolling diplomatic manoeuvres between India and China. The standoff was resolved just in time to salvage the state visit of External Affairs minister Salman Khurshid to China and recently concluded visit of Mr Li to India.

China’s relationship with India has not been smooth in the past decades. Much like China’s strained relationship with its other neighbours in South China Sea, its relationship with India is soured over a border dispute (both countries fought a brief war in 1962, which India lost). Despite the border issues and lack of mutual trust both countries do significant amount of trade between them. China is India’s largest trade partner with total trade in 2012 at USD 66 billion (a decline of 12% over 2011). While trade is a good sign of cooperation and stability between the two countries, the fundamentals of a lasting peaceful coexistence are missing. Both countries accuse each other of encircling eachother with strategic assets in its immediate neighbourhood. The long standing border dispute, one of the main reasons for lack of trust is not heading towards a solution. China and India are rapidly building up their military and naval powers much to the dislike of each other.

The hand across the Himalaya

Given the strained relationship of India and China the visit of premier Li should have been used to start a process of easing the tensions. Sadly the visit ended with lot of politically correct statements and eight uninspiring documents signed by the two sides. Of these eight documents only two were of any real value. The first is the work programmes of three working groups for services and trade promotion, economic and trade planning and trade statistical analysis. The second is sharing of information on Brahmaputra (a river in north eastern India, which originates in Tibet) during flood seasons. The other six documents deal with Kailash Mansarovar yatra (a Hindu pilgrimage in Himalayas now under Chinese control), meat quarantine, sewage treatment, irrigation, translation and publication of classical work and identifying sister cities. Mr Li however reiterated that the handshake across the Himalaya is now stronger than before. When two fastest growing emerging economies sign agreements on sewage treatment and meat quarantine it can hardly be seen as a handshake. It was more of a nodding from a distance than a real handshake.

The more interesting visit is however that of India’s prime minister Mr Manmohan Singh to Japan. Japan, like many other countries in the region shares an uneasy relationship with China which goes back to the days of imperialist Japan. On top of that both countries have seen loud sabre rattling over a group of uninhabited islands (Senkaku to Japanese and Diaoyu to Chinese) recently. In fact the situation there is much more volatile than that between India and China. The rise of Mr Shinzo Abe, a nationalist as the prime minister of Japan has made matters worse for China. He has taken an aggressive stand against the long stagnation of the economy and is projecting himself as a man who wants to restore the lost glory of Japan.

Lets do it together

At the end of the visit India and Japan agreed on various issues ranging from civil nuclear energy cooperation, possible technology transfer of an amphibious aircraft the US-2, funding for urban infrastructure, funding of Chennai – Bangalore industrial corridor, a high speed train between Mumbai and Ahmedabad, educational grants and so on. This kind of cooperation will have a long lasting impact on the bilateral relationship and will create opportunities for both countries in the near future. India with its growing economy and younger population is a large market for Japanese investments. 

At present Japan is the second largest foreign investor in China with a total investment of USD 70 billion. A survey by Japan export trading organisation last year showed that India is emerging as the most preferred alternative site for Japanese investment. Japanese companies are facing problems in China due to the political relations of the two countries. Industry experts say that even if a small fraction of the Japanese investment in China moves to India it will create many jobs and boost industrial production.

The difference between the two visits is stark. The Chinese visit can at best be considered as a step towards an attempt to forge good relationship. The Japanese visit on the other hand is graduation of a long relationship into that of a natural indispensible partnership.  

India’s improving Bangla relations

Out from the cold storage

Prime Minister Manmohan Singh will breathe a little easy on September 6^th and 7^th. He will be on a state visit to Bangladesh, away from heat of the anti corruption movement back home. Prime Minister Singh’s visit is closely watched by many in India and Bangladesh (more closely by Bangladesh media). After a long period of hostile and unfriendly governments in Bangladesh, Prime Minister Sheikh Hasina has come as a welcome change. Relationships between the two countries have improved significantly with a state visit by Prime Minister Hasina in early 2010. The current visit by India is expected to further strengthen the relationship.

After the first military coup in Bangladesh which eliminated the entire family of its first Prime Minister Sheikh Mujibur Rehman (from which Sheikh Hasina escaped), India lost interest in its neighbour. Domestic issues, Pakistan and an escalating cold war kept India busy. Lack of active Indian interest and successive regimes hostile to India were used by China and Pakistan to nurture insurgency in North Eastern states of India. Matter got worse with thousands of Bangladeshis migrating illegally into India for economic reasons. In effect India Bangladesh relations were strained.

Off late it has dawned upon India to actively involve Bangladesh and forge a mutually beneficial relationship. India sees a great prospect of connecting its North East with rest of the country by means of transit corridors. Currently it is extremely difficult to connect its North East through the existing Siliguri corridor (also known as ‘chicken neck’), which is barely 20 km wide at some points. For people living in India’s North East, transportation is a major issue and is often expensive. Air travel is the only means to travel quickly. Other critical matters like disaster management, health services, food supply, etc proves to be difficult owing to long distances to be covered and wastage in transit.

Bring it to the table

With Bangladesh doing its bit to curb anti India activities on its soil, India wants extend the deal and include infrastructure to connect to its remote region. India and Bangladesh together have identified transit corridors which will help not just India and Bangladesh, but Nepal and Bhutan too will be able to make use of transit corridors to connect to the ports in Bangladesh. India has extended a credit line worth $ 1 billion on concessional terms to implement the project.

Let the barbed wire not stop the dove

India and Bangladesh are also working hard to resolve their border issues. The two countries share the longest international border in the world (4,100 km) and also have a unique situation of enclaves and counter enclaves in each other’s territories. A solution is expected to be arrived at before Prime Minister Singh visits Dhaka early next month. Available information suggest at a possible land swap to firm up the border. This will be a first complete border settlement case for India.

One of the most sensitive issues between India and Bangladesh was of shooting of illegal migrants (most of them are Bangladeshis). India’s Border Security Force (BSF) killed 33 Bangladeshis in 2010, while they were crossing over illegally into India. This had not gone down well with the government and common man in Bangladesh. Killing of Felani, a teenage girl by the BSF was widely criticised by Bangladesh and international media and human rights agencies. A meeting between home ministers of the two countries has resolved the issue with India promising not to shoot any one crossing the border.

On the trade front India and Bangladesh did trade worth $ 2.6 billion, which is close to 0.58% of India’s total trade. This can definitely be improved. Prime Minister Singh should take this opportunity to foster closer business ties with Bangladesh, offering greater private investment in the country. Taking advantage of India’s strengths in information technology, companies like TCS and Infosys should be encouraged to set shops in Bangladesh. Active involvement in Bangladesh’s economy will ally fears of a sell off to India. India and Bangladesh should eventually move towards a free trade agreement where there is no list of negative trade items.

For all this to happen, both countries should upgrade their surface transport. A road or train trip to Dhaka from Indian state of West Bengal can take as long at 12 hours, to cover 400 km. To ensure more people to people contact, a convenient transport system is very important. A swift system will ensure more cross border movement and hence closer cultural ties. India and Bangladesh share a lot in common, from Rabindra Nath Taogre who wrote the national anthem of both countries to a common language (in West Bengal) to culinary habits and of course the love for cricket. Bringing the two countries closer will not be difficult provided India plays its cards wisely.