THEN Few countries have more reason to be close and have such a touchy relationship. The Indian elite often saw Bangladeshis as ungrateful for India's assistance in winning them independence. Dhaka's leadership complained about New Delhi's highhandedness on water, immigration and land issues. The Bangladesh Nationalist Party headed by Khaleda Zia has consistently made defiance of India one of its campaign planks. However, the core source of New Delhi's irritation with Dhaka was its belief Bangladesh was allowing itself to be used as a haven for Northeast rebels and Pakistan-backed terrorists. As long as Bangladesh refused to do anything about these concerns, New Delhi treated Dhaka as the capital they had to tolerate but not deal with.
NOW A massive window of opportunity swung open when Sheikh Hasina Wajed's Awami League swept the polls in 2008. Sheikh Hasina decided to spend much of this political capital to transform relations with India. Her visit to India with a 123-member delegation in 2010 put in place the contours of a broader, swifter engagement.
Hasina worked hard to address India's security concerns: among other things, top ULFA leader Arabinda Rajkhowa was handed over and the terror conduits from Pakistan were closed down. Senior Indian officials say that Bangladesh "gave complete security cooperation over the past three years".
This paved the way for Prime Minister Manmohan Singh's visit last year. It should have been a historic summit, a giant sweeping away of all the cobwebs and detritus that had accumulated for 40 years. Answers to all existing problems were there: land enclaves, river water sharing, Northeast transit, trade and investment, and so on.
At the last moment, West Bengal chief minister Mamata Banerjee put a spanner in the works and let the air out of the visit. She blocked the Teesta water treaty, leading an angry Bangladesh to freeze the transit agreement and five other river agreements.
WHY With 80% of Parliament behind her, an economy buoyed by natural gas finds and strong military backing, Sheikh Hasina believed she had a mandate to erase India as a "problem" in Bangladeshi politics. It was also about changing the Bangladeshis "blame it on India" mindset and neutralising an issue used against her by the nationalist Khaleda Zia and Islamicist groups.
Mamata Banerjee's intervention, seemingly driven by a dual desire to blackmail New Delhi for funds and weaken the Congress Party's hold on North Bengal, has left Indian officials in cold sweat. With Bangladesh going to the polls, all that has been negotiated is at risk. Bangladeshi foreign minister Dipu Moni is privately believed to have pushed for deep-sixing the entire India policy, but Sheikh Hasina continues to hold the line.
NEXT Two scenarios face the relationship. The best would be for the Centre to strike a deal with Banerjee and allow the shebang to quickly go through. There should be no doubt as to how big this would have been for India - a foreign policy coup on the scale of the Indo-US nuclear deal.
The more likely one is that a moth-eaten version of the deal, minus transit, Teesta and an enclave agreement, will go ahead. India will have to pray Dhaka's next government will uphold what has been agreed to and agree to finish the rest later. Assuming that Kolkata changes its attitude.