Neighbourhood First Policy : Budget 2024
- In the recently announced Union Budget 2024-25, the (MEA) has outlined its development assistance plans with a focus on strategic partners and neighbouring countries.
- It is designed to promote regional connectivity, cooperation and stability in line with India’s Neighbourhood First policy.
Distribution of development assistance to countries:
- A large part of the expenditure of the Ministry of External Affairs, Rs 4,883 crore, has been earmarked for “assistance to countries.” It is allocated as follows:
- Bhutan: It received the highest assistance of Rs 2, 068.56 crore, though it is slightly lower than last year’s Rs 2,400 crore.
- Nepal: It has been allocated Rs 700 crore, up from Rs 550 crore last year.
- Maldives: It retained an allocation of Rs 400 crore despite a revised amount of Rs 770.90 crore for the previous year.
- Sri Lanka: It received Rs 245 crore, up from Rs 150 crore last year.
- Afghanistan: Afghanistan received Rs 200 crore, reflecting India’s role in assisting the country’s stability and development amid current challenges.
- Maldives: Maldives received Rs 400 crore despite anti-India protests and comments by its top leadership.
- Iran: The Chabahar port project continues to get Rs 100 crore, unchanged for the last three years.
- South Africa: The African countries collectively received Rs 200 crore, reflecting India’s growing influence and engagement with the continent.
- Seychelles: It was increased from Rs 10 crore to Rs 40 crore.
Benefits of development assistance to neighbouring countries:
Strengthening Diplomatic Ties:
- By providing assistance to neighbouring countries, India enhances diplomatic relations, fosters stronger political and economic ties.
Promoting regional stability:
- Financial assistance helps stabilise neighbouring countries, leading to a more secure and stable region, which will benefit India’s strategic interests.
Supporting economic growth:
- Contributes to infrastructure projects, development programs and other initiatives that can boost economic growth in recipient countries, leading to a more prosperous region. For example, the Chabahar port in Iran.
Promoting trade and investment:
- Better infrastructure and economic conditions in neighbouring countries can enhance trade and investment opportunities for India, for example, the Agartala-Akhaura railway project between India and Bangladesh.
To enhance the strategic impact:
- Providing assistance allows India to exert influence and build alliances, ensuring that neighbouring countries have a positive engagement with India and engage more closely with its interests.
- For example, Bhutan siding with India on the Doklam issue.
In order to meet human needs:
- Aid often addresses urgent humanitarian needs such as health care, education and disaster relief, thereby improving the quality of life in recipient countries.
- For example, India launched “Operation Karuna” to provide humanitarian assistance to Myanmar during Cyclone Mocha.
Strengthening Soft Power:
- By investing in the development of neighbouring countries, India strengthens its soft power and reputation as a responsible regional leader.
- For example, it helps reduce the Big Brother syndrome among India’s smaller neighbours.
India’s Neighbourhood First Policy:
- The concept of Neighbourhood First Policy came into existence in 2008.
- India’s’ Neighbourhood First Policy ‘specifies its approach towards managing relations with its immediate neighbours, namely Afghanistan, Bangladesh, Bhutan, Maldives, Myanmar, Nepal, Pakistan and Sri Lanka.
- The Neighbourhood First policy, inter alia, aims at enhancing physical, digital and people-to-people coordination and connectivity as well as trade and commerce across the region.
- This policy has evolved as an institutional priority for all relevant branches of government managing relations and policies with our neighbourhood.
- India’s approach to engagement / coordination with its neighbouring countries is characterised by a focus on consultation, non-reciprocity and achieving tangible / tangible results. This approach gives priority to enhancing connectivity, infrastructure, development cooperation, security and further promoting people-to-people coordination.
Why Neighbourhood First Policy is important for India:
Terrorism and Illegal Migration:
- India faces threats of terrorism and illegal migration, including smuggling of arms and drugs from its immediate neighbours.
- Better relations can improve border security infrastructure and monitor demographic / demographic changes due to illegal migration.
Relations with China and Pakistan:
- Relations with China and Pakistan are tense, especially due to Pakistan-linked terrorism.
- Joining regional and multilateral organisations can highlight Pakistan’s role in terrorism and create a common platform to counter terrorism under the Neighbourhood First policy.
Investments in Border Security Infrastructure:
- Border security infrastructure is lacking, and border areas need to be stabilized and developed.
- Better connectivity infrastructure such as cross-border roads, railways and ports and explore a regional development fund for such infrastructure.
Monitoring of Loan Arrangement (LOC) Projects:
- India’s LOCs to neighbouring countries have increased significantly, accounting for 50% of global soft lending.
- It enhances India’s influence in the region, expands the presence of Indian firms and builds economic ties with recipient countries.
Defence and Maritime Security:
- Defence cooperation is important in which joint military exercises are conducted with various neighbouring countries.
- It helps in increasing Maritime Domain Awareness in the extended neighbourhood.
Development of Northeastern Region:
- Development of Northeastern Region is important for policies like Neighbourhood First and Act East Policy.
- Countries like Myanmar and Thailand can help improve connectivity, economic development and security in the Northeastern Region, such as the India-Myanmar-Thailand Trilateral Highway.
Promotion of Tourism:
- India is a major source of tourists for Maldives and Bangladesh and a destination for Nepalese religious tourism.
- Tourism promotes cultural exchange, which can lead to increased interest in Indian culture and businesses, which in turn can promote the export of Indian cultural products and services.
Multilateral Organizations:
- India’s engagement with neighbours is driven by regional mechanisms such as SAARC and BIMSTEC.
- Both help India establish its leadership role in South Asia and balance the influence of other major powers in the region.
Challenges in India’s relations with its neighbouring countries:
- Border disputes: Differences over borders, especially with China and Pakistan, lead to tension and conflict.
- China’s growing influence in the South Asian region and its close ties with Pakistan pose strategic challenges.
Terrorism:
- Pakistan has provided continued support, safe haven and funding to various terrorist groups such as Lashkar-e-Taiba (LeT) and Jaish-e-Mohammed (JeM), which have carried out attacks in India.
Illegal Migration:
- The influx of illegal migrants from Bangladesh into India raises demographic and security concerns.
Trade imbalances:
- Economic issues and trade barriers affect relations with neighbours such as Pakistan, Bangladesh and Nepal.
- Issues related to trade restrictions and tariffs have often exacerbated diplomatic tensions.
Water disputes:
- Disputes over river water treaties such as the Indus and Teesta rivers have been the cause of worsening relations with Pakistan and Bangladesh respectively.
Internal Conflicts:
- Political instability or disputes in neighbouring countries such as Nepal and Bangladesh affect bilateral relations.
Diplomatic relations:
- Issues such as the treatment of minorities in Sri Lanka and India’s stance on the Myanmar government create tensions.
- For example, the issue of Free Movement Mechanism (FMR) with Myanmar.
The environmental issues:
- Natural disasters and environmental problems (e.g. floods in Bangladesh) require joint efforts that can affect the relationship.
- For example, concerns about Bhutan’s BBIN and the environmental impact of tourism on its fragile ecology.
Regional cooperation:
- Differences within regional organizations such as SAARC and BIMSTEC can hinder effective cooperation.
- India’s initiatives to improve relations with neighbours
- Neighbourhood First Policy
- Act East Policy
- Security and Growth for All in the Region (SAGAR)
- Project Mausam
- BIMSTEC
- Rejuvenation of SAARC
- Gujral Doctrine
Suggestions:
Strengthening of diplomatic relations:
- Establish and maintain regular diplomatic dialogue and high-level meetings to address and resolve issues.
- Develop and institutionalize mechanisms such as joint committees and arbitration panels to resolve disputes.
Enhancing economic cooperation:
- Negotiate and implement fair trade agreements that address imbalances and promote mutual benefit.
- Cooperation on roads, railways and energy corridors to improve connectivity and economic integration.
Promoting Security and Stability:
- Coordinate regional security initiatives to address common threats such as terrorism and illegal migration.
- Establishing joint task forces and intelligence-sharing mechanisms.
Promoting people-to-people contact:
- To enhance educational and tourism initiatives to build mutual understanding and goodwill among the people.
Addressing environmental and humanitarian issues:
- Coordinating natural disasters and environmental problems using joint efforts and regional plans. To provide humanitarian assistance and support in times of crisis, promoting goodwill and cooperation.
- Coordinate on natural disasters and environmental problems using joint efforts and regional plans.
Strengthening of Regional Organizations:
- Actively participate in regional organizations such as SAARC and BIMSTEC to address regional issues and improve their mechanisms for decision-making and implementation.
Focus on internal and external factors:
- Ensure that domestic policies do not adversely affect relations with neighbouring countries.
- To strive for balanced policies that take into account both domestic and international implications in line with the Gujral Doctrine.
