E-Paper
Beyond the past: Complex trajectory of Indo-Bangladesh relations
This article is authored by Shishir Priyadarshi, president, Chintan Research Foundation, New Delhi.
The recent dramatic overthrow of the Awami League government led by Sheikh Hasina waged by a spontaneous student uprising, later joined by other actors with varied intentions, seems a watershed event. Bangladesh has little continuity in political trends and constitutional commitments when political power changes hands and it is too early to say what political framework the interim government will create. However, the new dispensation will likely adjust the underlying norms to facilitate their preferred political orientation and policies.
The interim government expects to hold elections within three months, and even though the political environment, at the moment, is primarily filled with anti-India sentiments, Bangladesh–India relations have a strong foundation and have witnessed significant developments in mutual interest since Bangladesh's independence. These include addressing longstanding issues such as the land boundary agreement, the exchange of enclaves, improvements in trade and commerce, and granting India limited freight rights across Bangladesh to improve regional connectivity. While some matters, like the Teesta water-sharing agreement, remain unresolved, the overall trajectory of bilateral ties has shown marked progress.
However, both countries must look ahead; undoing the bilateral gains of the past will not be in either country's interest. The key to any bilateral relations is to strengthen mutual benefits and common understandings while continuing to discuss areas of divergence and sometimes even agreeing to disagree. In the case of India-Bangladesh relations, either country can ill afford a prolonged period of mistrust and a freezing of relations. This makes an even stronger case for pragmatism to take charge of the relations.
The strengthening of bilateral relations, which has been the guiding light of India's Neighbourhood First Policy, has brought unprecedented economic benefits to Bangladesh and pulled it above the ranks of the least developed countries. Much of this can be attributed to a historic and enduring partnership with India, built upon shared values and interests, trust, and equality and rooted in mutual sensitivity to each other's aspirations and concerns.
Bangladesh is India's biggest trade partner in South Asia, and India is the second biggest trade partner in Asia. In FY 2022-23, the total bilateral trade has been reported as $15.9 billion. The partnership transcends connectivity, power, energy collaboration, green and digital technologies, water and disaster management, defence and security, and humanitarian and developmental aid.
All-weather, robust, and secure connectivity with Bangladesh is in the interest of the countries and the region. It facilitates trade-led economic prosperity, provides pathways for greater people-to-people interaction and cross-country interdependencies, and generates mutual goodwill. It also gives India's landlocked Northeast territories connectivity to the mainland and access to the sea for improved maritime trade opportunities. Both governments have made efforts to strengthen this connectivity. Accordingly, six rail links have been rehabilitated connecting multiple cities of both countries; five bus service routes are operational between India and Bangladesh, connecting cities of Kolkata, Agartala, and Guwahati to Dhaka and further up to Khulna.
Along with this, the agreement for usage of Chattogram and Mongla Ports has been operationalised for transiting cargo between northeast and mainland India, reducing the cost and time of transportation. Strengthening Indian links with the Chattogram port is also poised to boost regional networks. It will connect with the Ranong Port in Thailand, providing India with another route to Southeast Asia to realise its Act East Policy.
In spite of improved connectivity, the BBIN (Bangladesh, Bhutan, India, Nepal) sub-region remains one of the least integrated areas globally. According to a study by CUTS International, trade between Bangladesh and India, the region's largest economies, remains minimal, accounting for only 1% of Indian trade and 10% of Bangladeshi trade. In contrast, interregional trade in East Africa and sub-Saharan Africa accounts for 50% and 22% of their total trade, respectively. Given these disparities, enhancing regional connectivity is imperative. Bangladesh's strategic geographic location, serving as a crucial transit route between mainland India and its northeast and providing port access to Nepal and Bhutan, underscores its pivotal role in facilitating regional integration. The 2021 World Bank report suggests that boosting regional trade could increase India's national income by up to 7.6% and Bangladesh's by more than 16%, promoting prosperity for a substantial portion of the global population.
In addition to connectivity to enhance bilateral trade and investment, India has approved a third line of credit worth $115 million to develop two Indian Special Economic Zones (ISEZ), one at Mirsarai and one at Mongla each. The ISEZ is anticipated to boost industrialization and create jobs, particularly in manufacturing and exports to neighbouring countries, including India's Northeastern states.
New Delhi has also made significant efforts to help Bangladesh mitigate its energy challenges. Bangladesh imports significant electricity from India, amounting to 2,656 megawatts (MW) from various Indian public-private owned power stations. This electricity is supplied by major Indian companies, including NTPC's subsidiary Vidyut Vapar Nigam Limited (NVVN), Sembcorp Energy, PTC India, and Adani Power. Specifically, 160 MW comes from NTPC's Tripura power plant, while 250 MW is supplied by Sembcorp Energy, 200 MW by PTC India, and a substantial 1,496 MW by Adani Power's Jharkhand plant. Despite the heavy reliance on imported power, Bangladesh is struggling with outstanding dues due to its inability to pay bills regularly, partly because of delays in receiving government subsidies, the depreciation of the Bangladeshi currency against the dollar, and a subsequent decline in foreign reserves. The ongoing delays in settling these dues have reduced the electricity supply from some Indian providers.
The potential for cooperation between the two countries is immense on the renewable energy front. India, the world's third-largest producer of renewable energy, has already achieved two of its Nationally Determined Contributions (NDCs), with 40% of its installed electricity capacity coming from non-fossil fuel sources. Indian companies like Tata Power and Adani Green Energy, which are leaders in the renewable energy sector, can offer Bangladesh technical expertise, investments, and infrastructure support. This is especially crucial as Bangladesh aims to generate 40% of its energy from renewables by 2041 but currently only derives 3% from these sources. India's experience in rapidly scaling up its renewable capacity, cross-border energy trade, and grid integration can accelerate Bangladesh's transition to green energy while enhancing regional energy security. This cooperation would also reduce Bangladesh's dependence on fossil fuel imports and strengthen the energy partnership between the two countries.
Bangladesh and India cannot change their geographical proximity. Both countries will need an active and yet flexible "look east and west" policy. A State with a poor land-man ratio and most seriously affected by the climate crisis has to prioritise socio-economic development over everything else. India also has to acknowledge the limits of its bargaining vis-à-vis smaller neighbours. The changed geopolitical environment with an aggressive China impacting at least some elements of Indian foreign policy means that New Delhi must exercise generosity and flexibility in dealing with its neighbours.
While India cannot, and must not, forgo the priority of its national interest, it needs to engage imaginatively and proactively with the people, civil society, NGOs, press, and industry in Bangladesh, as more than conventional diplomacy is needed. Track 2 diplomacy involving non-governmental and informal contacts can be critical in improving India-Bangladesh relations. In the current context of political instability in Bangladesh, informal dialogues between academicians, business leaders, and civil society actors from both countries can create platforms for mutual understanding. These initiatives can provide valuable insights and recommendations that help shape official policies, creating a collaborative environment that strengthens bilateral ties. The past practice of keeping all eggs in one basket will no longer work. It is necessary to recognize the diversity of political positions in Bangladesh to work out a new framework of relations within a reasonable timeframe in a creative manner. Today's watershed moment will decide the future of 'Sonaali Adhyaay' in the bilateral relations between the two countries.
This article is authored by Shishir Priyadarshi, president, Chintan Research Foundation, New Delhi.
