Answer

India’s neighbourhood policy is evolving from a focus on regional engagement like SAARC to prioritising bilateral relationships, influenced by great power dynamics and traditional rivalries with China and Pakistan. This shift seeks to safeguard strategic interests, as highlighted in the Neighbourhood First Policy while balancing India’s role as a regional leader.

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Transition of India’s Neighbourhood Policy from Regional Engagement to Bilateral Relationships

• Focus on Strategic Autonomy: India is shifting towards bilateral ties to maintain strategic autonomy and reduce dependency on regional frameworks like SAARC, which have been ineffective due to political constraints.
  For example: India’s active engagement with Bangladesh on water-sharing treaties bypassed SAARC’s stagnation and promoted bilateral cooperation.
• Tailored Partnerships: Bilateral engagements enable India to address the specific needs of countries, enhancing mutual trust and delivering customised solutions, unlike generalised regional approaches.
  For example: The India-Bhutan hydropower cooperation is a targeted bilateral success story enhancing Bhutan’s economy and India’s energy security.
• Bypassing Regional Gridlocks: India’s bilateral focus mitigates regional stalemates caused by rivalries like India-Pakistan tensions that often paralyse regional mechanisms.
  For example: India concluded the India-Maldives Defense Cooperation Agreement without involving SAARC due to Pakistan’s obstructive policies.
• Economic Prioritization: Bilateral frameworks facilitate robust trade agreements, ensuring quicker negotiations and implementation compared to slower regional consensus-building.
  For example: India and Nepal’s bilateral energy trade agreements boosted renewable energy exchange, bypassing regional energy-sharing delays.

Managing Great Power Dynamics with Traditional Rivalries

• Balancing Act with China: India counters China’s Belt and Road Initiative (BRI) while maintaining engagement on multilateral platforms like BRICS and SCO to manage tensions without confrontation.
  For example: India opposed BRI but joined SCO’s initiatives on counter-terrorism to retain strategic leverage.
• Leveraging the Quad: By aligning with the Quad (USA, Japan, Australia), India balances great power competition while ensuring strategic security in the Indo-Pacific.
  For example: India conducted the Malabar Naval Exercise 2023 with Quad members, strengthening maritime security against Chinese aggression.
• Russia-India Partnership: Despite Western sanctions, India sustains its defence and energy ties with Russia to retain strategic autonomy while balancing US expectations.
• Strategic Engagement with the US: Strengthening ties with the US boosts India’s technological and defence capabilities, countering Chinese assertiveness without overly depending on the West.
  For example: The US-India Initiative on Critical and Emerging Technologies (iCET) focuses on AI and semiconductor collaboration.

Impact of the Shift on India’s Strategic Interests

• Enhanced Bilateral Cooperation: Bilateral ties allow India to tailor agreements to each neighbour’s unique priorities, reducing dependency on regional forums.
  For example: India’s USD 1.4 billion aid package to the Maldives in 2023 strengthened ties through direct financial assistance.
• Reduction in Collective Bargaining Challenges: By focusing on bilateral relations, India minimises obstacles posed by divergent interests within regional organisations like SAARC, enabling swifter decision-making.
• Countering External Influences: Bilateralism reduces external powers’ leverage in multilateral forums, strengthening India’s regional foothold against China’s Belt and Road Initiative (BRI).
  For example: India’s direct engagement with Sri Lanka secured access to strategic ports, countering Chinese influence at Hambantota.
• Increased Resource Allocation Efficiency: Bilateral relationships ensure focused resource deployment tailored to specific projects, enhancing diplomatic and economic returns.
  For example: India’s Kaladan Multimodal Project in Myanmar exemplifies strategic, outcome-driven investment.

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Framework for Balanced Neighbourhood Engagement in 2025

• Strengthened Bilateral Infrastructure: Build robust bilateral economic and strategic partnerships while respecting neighbours’ sovereignty and sensitivities to ensure mutual benefits.
  For example: India’s BBIN Motor Vehicle Agreement demonstrates cooperative regional connectivity through bilateral and subregional efforts.
• Integrated Multilateral Approach: Revitalize platforms like BIMSTEC alongside bilateral ties to address regional challenges and foster collective decision-making.
  For example: BIMSTEC’s 2024 summit prioritised disaster management and energy cooperation, promoting regional unity.
• Balancing Great Power Dynamics: Maintain strategic autonomy by diversifying partnerships and ensuring transparent regional engagements to avoid polarising alignments.
  For example: India’s Quad membership balances partnerships with the US while maintaining ties with Russia and ASEAN nations.
• Focused Economic Diplomacy: Prioritize trade agreements and infrastructure investments to promote interdependence, ensuring economic resilience within the region.
  For example: India’s concessional credit line to Nepal in 2024 accelerated cross-border energy projects.

A balanced neighbourhood engagement framework in 2025 should emphasise bilateral cooperation, regional stability, and strategic autonomy amidst great power rivalries. Leveraging platforms like BIMSTEC, focusing on connectivity, and advancing economic partnerships, India can uphold its strategic interests while fostering a harmonious South Asia.

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