Why India and China Are Competing for Better Ties With Bangladesh

Earlier this month, India’s new foreign secretary, Vijay Kashev Gokhale, visited neighboring Bangladesh for meetings on issues ranging from Rohingya refugees to the sharing of water supplies. New Delhi and Dhaka also signed a memorandum of understanding to build an 80-mile oil pipeline that would allow oil to be exported to Bangladesh. India’s efforts to deepen ties with Bangladesh are part of Prime Minister Narendra Modi’s ambitious “neighborhood first” foreign policy initiative. In an email interview, Michael Kugelman, the deputy director of the Asia Program and senior associate for South Asia at the Woodrow Wilson International Center for Scholars, discusses the state of Indian-Bangladeshi relations, how they fit into Modi’s regional agenda, and why China is “the key obstacle” to strengthening ties.

WPR: What is the current state of ties between India and Bangladesh?

Michael Kugelman: The India-Bangladesh relationship is in a fairly good place today, and it has improved significantly in recent years. One major convergence between the two governments has been counterterrorism; both states are very tough on terror and are not afraid to crack down hard on it.

There are certainly irritants. These include the Rohingya issue. New Delhi is uncomfortable about the security implications of so many Rohingya refugees from Myanmar being housed across the border in Bangladesh. There are also tensions over a water-sharing agreement for the Teesta River, which flows from India through Bangladesh. Dhaka has pushed for finalizing the accord for years, and New Delhi is on board, too. However, in India, water is a state issue, meaning local state governments must sign off on transboundary water deals. The state government in West Bengal has balked for years at signing the accord. But perhaps the biggest irritant in India-Bangladesh relations is the deepening inroads in Bangladesh being made by China, New Delhi’s core strategic rival.

WPR: How successful has Modi’s “neighborhood first” policy been so far, and how do closer ties to Bangladesh advance India’s regional goals?

Kugelman: One criticism about Modi is that he has attached a bunch of catchy slogans to new policies, but hasn’t really made substantial progress in pursuing those policies. The “neighborhood first” policy, which is meant to boost New Delhi’s relations with its neighbors, is an example. It has good intentions: One of its first manifestations was Modi’s decision to invite Pakistani Prime Minister Nawaz Sharif to Modi’s inauguration in 2014. However, since then, the India-Pakistan relationship has faltered and is currently mired in a nasty stalemate. Even India’s relations with its best friends in South Asia have suffered hiccups. In Nepal, for example, the two countries got into an ugly spat over accusations that India was blocking the delivery of goods into Nepal. Meanwhile, India hasn’t been able to stop China from deepening its footprint and influence in New Delhi’s backyard, from Pakistan to Sri Lanka and many places in between.

Perhaps the most sobering indication of the failure of “neighborhood first” is India’s decision over the past two years to use South Asia’s chief regional organization, the South Asian Association for Regional Cooperation, or SAARC, as a way to undercut Pakistan. In 2016, India managed to get several SAARC countries to agree to boycott an annual SAARC conference scheduled to be held in Islamabad. Pakistan had no choice but to cancel the summit. There’s nothing neighborly about using a regional forum for cooperation to turn your neighbors against each other.

Bangladesh is really the exception to the rule when it comes to the “neighborhood first” policy. This is one country where the Modi government has been able to make major strides in deepening relations with a key neighbor. In recent weeks alone, top officials from both countries have met multiple times and concluded a number of agreements. For India, which worries that it’s slowly being pinned down and encircled by China in its own backyard, its deepening relationship with Bangladesh is an important strategic achievement.

WPR: What opportunities are there for deepening the relationship? What are the obstacles?

Kugelman: One of the less-discussed avenues for potential cooperation is energy. India and Bangladesh have quietly pursued a series of energy deals that can potentially bring big benefits to both countries. These include an arrangement for India to use transit facilities and the electricity grid in Bangladesh to provide energy supplies to India’s impoverished northeast. Another deal involves India providing electricity to Bangladesh in return for Bangladesh providing internet bandwidth in India’s northeast. Additionally, very preliminary discussions are underway for an electricity-sharing mechanism between India, Bangladesh, Bhutan and Nepal. These energy deals can bring more goodwill to a relationship already demonstrating a fair amount of growth.

The key obstacle for the India-Bangladesh relationship moving forward is China. Beijing is bent on deepening its influence and investments in Bangladesh, and Dhaka isn’t about to shoo the Chinese away. For New Delhi, that’s reason for concern.

The question is, Can India’s relationship with Bangladesh deepen at the same time that China’s does? Ultimately, the China factor need not be an insurmountable obstacle. New Delhi is no stranger to pursuing deep partnerships with countries that court India’s rivals. The U.S.-India relationship, for example, continues to expand even as Washington maintains a workable, albeit shaky, relationship with Islamabad. In due course, there’s reason to believe that New Delhi will be pragmatic, accept that Dhaka will continue to seek Chinese capital and investment, and keep working to build more cooperation with Bangladesh. Of course, it will be easier for New Delhi to accept a deepening Chinese footprint in Bangladesh if it receives assurances that the footprint will be strictly economic in nature—with no Chinese plans, for example, to construct naval facilities off the coast of Bangladesh. And on that count, I don’t see India being reassured anytime soon.