Redefining India’s Neighborhood Policy: Modi’s BIMSTEC Rationale To Replace SAARC


In his first swearing-in ceremony with thumping majority in 16th Lok Sabha elections (2014), India Prime Minister Narendra Modi had invited all SAARC leaders giving neighborhood first policy a top priority. With SAARC turning dysfunctional to regional connectivity and taking Pakistan factor on critical note Modi moved to the BIMSTEC groupings when he invited all its members in the BRICS summit (October 2016), at Goa. Again, the second Modi government has invited all BIMSTEC leaders on 30th May, 2019, the day of oath taking. It clearly indicated that Modi government’s foreign policy is likely to redefine its neighborhood.

The BIMSTEC is commonly known as Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation which includes five SAARC members—Bangladesh, India, Sri Lanka, Nepal, Bhutan along with Myanmar and Thailand.

However, since 2011 particularly with the coming of PM Narendra Modi regime (2014) in power, India has witnessed a dramatic change in its neighborhood policy. Given India-Pakistan bitter relations, India has been trying to isolate Pakistan not only at the world stage but also distancing itself from making any regional proximity with the latter. Even, in his recent swearing-in ceremony for his second term as Indian Prime Minister, Modi has not Invited Pakistan. Rather, he invited all BIMSTEC countries as an indication of posing it a substitute to the SAARC organization. The author would like to call it a “Modi-fication of neighborhood policy.” Speculations are emerging about how India’s neighborhood policy is going to have the effect of Modi charisma and how it will serve as a better option than that of SAARC.

India’s Neighborhood Policy

The regional politics has become a buzzword in the current international settings as every country is trying to seek good neighborly relations with its bordered/adjacent country. In the era of Asian century, China and India, the two big Asian powers, have been striving for securing strategic/diplomatic relations with their neighbors hailing new economic designs and developing new economic blocs. The role of neighbors have always been determining factor in India’s foreign policy as it is well said—“Better is a neighbor who is near than a brother far away.” However, a bad neighbor, on the other hand, is a misfortune.

India also has developed a SAARC-like regional bloc to bring economic prosperity in the region. But it could not succeed due to the Pakistan puzzle—an arch rival neighbor of India. Therefore, the Modi Government has decided to close the SAARC chapter.

Prime Minister Modi’s charismatic personality and diplomatic moves have revived the regional structuralism which has become a backbone of India’s foreign policy. Given its geopolitical position and large size of population in Asia its economic development programmes have not been limited to its immediate neighborhood South Asia rather stretched out to extended neighborhood from Central Asia and West Asia to East Asia. Since independence, India has been striving for developing regional structures and SAARC is the first example as such which came into existence in 1985.
China’s growing and assertive influence on India’s immediate neighborhood and New Delhi’s growing energy and security requirements compelled Modi government to take crucial decisions in the backdrop of regional integration, peace and economic cooperation. Thus, “Neighborhood First” policy has become a cornerstone of Modi’s diplomatic and strategic approach.

Redefining India’s Neighborhood Policy: SAARC Averse

Since the Modi government’s coming into power, India’s regional policy has undergone dramatic twists in its traditional diplomatic stress on “Neighborhood First” agenda. Many incidents of unintelligible diplomacy and growing tensions between neighbors have plagued SAARC with internal problems and bilateral issues. The structural failures of SAARC has made South Asia world’s less connected region.

Terrorist activities on the part of Pakistan providing safe heavens to militant groups have remained a stumbling block for Indo-Pak peaceful dialogue. The terrorist attack on Indian Territory Uri—an Army Brigade headquarters was resulted in the cancellation of 2016-SAARC summit in Islamabad by Indian government. It was backed by all SAARC members. Since then, no movement has been observed on resuming next SAARC summit. Moreover; Pakistan’s counter-India alliance with China to outmaneuver New Delhi has caused China’s geo-economic and geopolitical installations in the region.

Additionally, other South Asian nations along with Pakistan have started raising demand of China’s inclusion in the SAARC framework. However, it is argued that the dysfunctionality of the SAARC groupings in terms of mutual rivalries slow down their intra-regional geopolitical and economic coherence.

Apart from this, SAARC organization has experienced a controversial legacy over the time. This has been one of the main reasons that India failed to define its demarcation of boundaries with neighboring countries. India’s big land size and “Big Brother” status has remained susceptible for South Asian neighbors. With her aspiration to seek permanent seat in the UN Security Council, India has been characterized as Asian power and economics leader since the introduction of national economic reforms.

India’s neighbors have always remained sensitive to Indian foreign policies vis-à-vis SAARC grouping. Consequently, they have started stepping towards developing sub-regional establishments such as the South Asia Subregional Economic Cooperation (SASEC), Economic Cooperation Organization (ECO), Mekong–Ganga Cooperation (MGC), Shanghai Cooperation Organization (SCO) and BIMSTEC etc. Pakistan has moved towards West Asia.

SAARC Motor vehicle agreement (MVA) could not reach its conclusion because of being opposed by Pakistan. Consequently, India moved forward to Bhutan-Bangladesh-India-Nepal (BBIN) agreement in 2015. The South Asian nations including India have also started developing synergies between several interrelated bilateral and multilateral economic integration initiatives. These factors also caused to keep intra-regional trade and transit activities at lowest ebb. It led Modi government to redefine foreign policy of India towards South Asian neighbors which shifted the emphasis from SAARC to BIMSTEC to put South Asia-integration on the track.

The new India’s neighborhood policy also reads like extra-regional affairs when it became a permanent member of SCO. It is seen that to enhance its outreach to extended neighborhood, India needs direct route-connectivity and Pakistan remained hurdle to India’s connectivity projects such as TAPI, IPI, APTTA, South Asia Satellite and other energy projects etc. It has also impacted SAARC’s functionality. Pakistan, by refusing India to give a status of ‘Most Favoured Nation’ resisted the idea of the South Asia Free Trade Area (SAFTA) agreement. This rage reached its climax when India pull out MFN status form Pakistan after Pulwama attack (2019) this year. Therefore, it appears understandable in context of other regional groupings such a BIMSTEC and ASEAN-Regional Comprehensive Partnership (RCEP) with which India is trying to develop multi-lateral cooperation. These groupings can have also similar bottlenecks when it comes to the question of Indian investments and financial potentials of neighboring countries.
India’s Shift towards BIMSTEC

BIMSTEC earlier known as BISTEC was formed on 6th June, 1997 that included Bangladesh, India, Sri Lanka and Thailand Economic Cooperation. It was renamed “BIMSTEC” in the same year when Myanmar joined at Bangkok Ministerial Meeting on 22 December. In February 2004, BIMSTEC was again renamed as the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation when Bhutan and Nepal became full member.

Transcending their national identities BIMSTEC has become a maritime group of countries located around the Bay of Bengal in order to make progress in technical areas of energy security, tourism, trade, transport, telecommunications and other agricultural-related activities. It has established its first Secretariat in Dhaka in 2014. It has held only four summits since its formation. Given its tense relations with Pakistan within SAARC over terrorism, India wants to do more on BIMSTEC to rediscover the regional organization which appears to be based on India’s Panchsheel objectives.

Many political pundits indicate that BIMSTEC is not a perfect substitution of SAARC by giving the account of its second principle—“Cooperation within BIMSTEC will constitute an addition to and not be a substitute for bilateral, regional or multilateral cooperation involving the Member States.” Its official website lays down the claim that BIMSTEC manages to bridge a gap by providing “platform for intra-regional cooperation between SAARC and ASEAN members” (Association of Southeast Asian Nations). On this, Sri Lanka and Nepal’s leadership said during Modi’s second term swearing-in ceremony that BIMSTEC is important but “BIMSTEC would not replace SAARC as both are significant organizations.”

However, Modi’s stress on BIMSTEC is, in fact to stimulate the trade-transit and economic related initiatives in the region which remained drowsy over the last two decades. In additions to boosting blue economy; India also wants to cope with the maritime security issues through diplomatic engagements with all island and littoral nations. Indian PM Narendra Modi’s diplomatic visit to Maldives and Sri Lanka is an indicator to get all these nations out of Chinese debt-trap diplomacy.

Important to mention here that except Bhutan and India, all rim countries of the Bay of Bengal are participatory to China-led Belt Road Initiative (BRI). In his BIMSTEC strategy, Modi has urged for mutual cooperation against illegal migration and incidents of maritime piracy.

Also, India’s BIMSTEC engagement appears to be conforming to the Security and Growth for All in the Region (SAGAR) Initiatives which was outlined by PM Modi’s during his visit to Mauritius, Sri Lanka and Seychelles in 2015. It includes the objectives of economic potential, enhancing connectivity and accruing benefits from blue economies. It would also improve the trade scenario as FICCI’s knowledge paper “Reinvigorating BIMSTEC” has forecasted its intra-regional trade potential of US$250 billion which is currently at about US$40 billion. Given the current global trade dynamics, it appears understandable that India needs a greater connectivity for smooth trade transactions and economic cooperation. BIMSTEC is, therefore, going be a key priority for India in its neighborhood policy.

Impending Possibilities vis-à-vis SAARC

Indian leadership finds great potential in BIMSTEC groupings. The former Foreign Minister Kanwal Sibal reasoned for Pakistan not being invited in the oath taking event that, “the invitation to BIMSTEC leaders shows that India clearly believes that its interests are better served by this grouping than by SAARC. It implicitly conveys that there will be no move to engage Pakistan despite overtures by Prime Minister Imran Khan.”

A day before his first scheduled visit to Bhutan, the External Affairs Minster Mr. S. Jaishankar in his first public talk with CII (Confederation of Indian Industry), expressed that “SAARC has certain problems which are known to all. Even if you put the terrorism issue aside, there are trade and connectivity issues.” He further added that reason behind inviting all BIMSTEC leaders for the swearing-in ceremony has great future perspectives as India “see today energy and a possibility in BIMSTEC and a mindset which fits in with that very optimistic vision of economic cooperation that we want.”

India perceives strategic possibilities in the BIMSTEC in the backdrop of growing Chinese presence in the Indian Ocean. China’s debt-trap diplomacy has strategic implications for Indian security. Therefore, India is likely to enhance diplomatic as well as economic engagements with BIMSTEC countries which remained distant dream being in SAARC given India-Pakistan skirmishes.

It would be too early to comment on that India’s BIMSTEC policy aims at isolating Pakistan. In fact Modi government want to build more on BIMSTEC as it would give significant voice to India’s Act East policy and boost up India’s quad relations with Australia, Japan and the USA. It provides for a transitional gateway to integrate Indian market to ASEAN economies.

It will be important to see that how India will help BIMSTEC nations to rebuild their economies? How does the shift in regional balance of power make India a trust-winner among BIMSTEC countries because they have also been struggling over several issues such as migration/refugees, human-trafficking, scarcity of financial wherewithal? Returning to SAARC’s failure, it is more important than just imprecating Pakistan, India will have to improve its suspicious status in the eyes of its neighbors. Verily, relationships with India’s big as well as small neighbors need constant diplomatic attention amid the emerging regional dynamics.

*Sandeep Singh is an Assistant Professor in the Department of Political Science in the School ho Humanities and Physical Education at CT University, Ludhiana, Punjab, India. Email: [email protected]

Dr. Sandeep Singh

Dr. Sandeep Singh teaching at the Dr. Ambedkar Centre of Excellence, Central University of Punjab, Bathinda, India.

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