India-Bangladesh Relations: Convergences, Divergences & Way Ahead

Political Instability in Bangladesh

Context (IE): PM Sheikh Hasina’s resignation and flight to India amid protests mark a pivotal shift in South Asian geopolitics, raising concerns about Bangladesh’s stability and its relationship with India.

Recent Bangladesh Elections

Context (IE l IE l LM): Bangladesh Prime Minister Sheikh Hasina won the re-election for a fifth term.

The main opposition, the Bangladesh Nationalist Party (BNP), boycotted the polls.
Western nations, including the US, UK, and EU, have urged Bangladesh to hold free, fair, and participatory elections.
The BNP demanded elections under a caretaker government, which the government rejected.
This election became a high-stakes arena because of several international interests–
1. India’s buffer state priorities
2. China’s Belt & Road vision
3. Strategic interests of the United States
4. Russian infrastructure interests.

Catalyst for PM’s Resignation

Nationwide Uproar: Student protests over job quotas, fueled by governmental repression and violence from the Awami League’s student wing, ignited widespread unrest.
Democratic Deficit: Allegations of electoral violence and rigging diminished democratic credibility and contributed to public dissatisfaction.
Economic Challenges: Falling forex reserves, currency depreciation, and mounting external debt have created a looming debt crisis.
Chinese Loans: Much of the infrastructure development relies on high-interest loans from China.
Authoritarian Measures: Increasing use of stringent laws, such as the Digital Security Act, to suppress dissent led to a more authoritarian governance style.
Economic Disparities: Corruption, high-profile financial scandals, and growing inequality.
Authoritarian Practices: The Awami League’s (AL) authoritarian measures, including arrests and harassment of opposition leaders, have fueled resentment among the masses.
Corruption and Nepotism: Perceived corruption and nepotism within the AL have widened the gap between the government and the impoverished population.
Islamist Influence: The AL encouragement of Islamist groups like Hefazat-e-Islam Bangladesh has created a toxic environment within the ruling party.
Radicalization: Islamist organisations, through religious schools and mosques, have radicalised a significant portion of the population, especially the youth.
Islamist Opposition: The Islamist parties, including Jamaat-e-Islami, Hefazat, and Islami Oikyo Jote, now fill the opposition space.
Political Analyst’s Perspective: Political analysts argue that the AL’s crackdown on the BNP has inadvertently strengthened Islamist parties, which seek to implement strict Sharia laws and turn Bangladesh into an Islamic state.

Current Affairs

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Bangladesh’s Strategic Importance for India

Geostrategic Value: Bangladesh’s location provides critical access to the Bay of Bengal and serves as an essential trade route to Southeast Asia.
Regional Stability: Crucial for maintaining regional security and peace in South Asia.
Economic Interdependence: Eg., Export of Indian pharmaceuticals & import of Bangladesh textiles.

Cultural Connections: Shared heritage and cultural links, reinforced by festivals like Durga Puja and exchanges in music, literature, and film, strengthen interpersonal bonds and foster mutual respect
Regional Cooperation: Collaborative efforts in regional forums such as BIMSTEC and SAARC are vital for mutual development.

India-Bangladesh Relations

Economic relation

In 2022-23, Bangladesh was the fifth largest export destination for Indian goods after the US, the UAE, the Netherlands, and China. It accounted for over 2.7 per cent of all Indian exports, worth $12.2 billion.
Bangladesh is India’s biggest trade partner in South Asia and India is the second biggest trade partner of Bangladesh in Asia.
India is Bangladesh’s largest export destination in Asia, with approximately $2 billion of Bangladeshi exports to India in FY 2022-23.
In 2022, both nations concluded a joint feasibility study on a Comprehensive Economic Partnership Agreement (CEPA).

Security relations

A stable, prosperous and friendly Bangladesh is in India’s best interests.
The previous BNP-led government was quite hostile to India — and provided a haven to numerous anti-India terrorist and militant groups.
It allegedly also had links to Pakistan’s ISI.
The Present Government’s crackdown on anti-India elements and counter-terrorism cooperation with India has single-handedly improved India’s overall security situation over the last decade.
Bangladesh’s action resulted in the arrest of many top leaders of the NE insurgent groups like the ULFA and the National Democratic Front of Bodoland.
Also, Given the deteriorating situation in Myanmar, it becomes even more important that India and Bangladesh remain close security partners.

Regional Connectivity & Cooperation

Protocol on Inland Water Trade and Transit (PIWTT), operational since 1972, permits the movement of goods over vessels from India through Bangladesh’s river systems on 8 specific routes.
Under the present regime, Bangladesh facilitates efficient connectivity to India’s Northeast through overland transit and inland waterways.
Securing sea lines of communication: Bangladesh strategically places nearby essential sea lanes. It can play a significant role in containing piracy in the Indian Ocean.
Bangladesh is also crucial for economic integration within the subcontinent, especially since Pakistan refuses to support regional economic cooperation.
Bridge to Southeast Asia: Bangladesh is a natural pillar of the Act East policy.
- It can act as a ‘bridge’ to economic and political linkages with South East Asia and beyond.
- Bangladesh is an essential component of BIMSTEC and BBIN initiatives.
- Dhaka hosts the secretariat of The Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC), which connects Myanmar and Thailand.
Beyond the subcontinent, India wants Bangladesh to become a fulcrum for regional cooperation in the Bay of Bengal littoral linking South and South East Asia.
India’s friends, such as Japan, have invested heavily in Bangladesh.

Indo-Bangladesh Protocol (IBP) Route

India and Bangladesh initiated the first trial movement of vessels between Maia Port in India and Sultanganj Port in Bangladesh in February 2024.

It is set to take place on Indo Bangladesh Protocol (IBP) Route no. 5 & 6.
The waterway route from Maia (IBP route) to Dhubri (NW-2) via Aricha will reduce the distance by around 930 kilometers compared to the existing waterway route.
This development is in line with the Act East Policy.

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About IBP Route

IBP protocol was signed for the first time between India and Bangladesh in 1972. Under this, inland vessel of one country can transit through the specified routes of the other country.
50:50 cargo sharing by Indian and Bangladeshi vessels is permitted both for transit and inter-country trade.
This protocol route includes the river routes of Ganga, Brahmaputra, and their tributaries across the two countries.

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It connects the National Waterway (1, 2, 16 & 97).
This route enables easier access to the markets in the Northeast.
The Inland Waterways connectivity through the IBP route also holds significance for Bhutan.
As per the transit agreement between India and Bhutan, Dhubri on NW-2 is declared as an agreed exit/ entry point in India for Bhutan’s EXIM cargo movement.
Number of Port of call increased to 11 with 2 extended Ports of calls in both countries.

Strategic relations

Participation in multilateral forums such as:
1. SAARC (South Asian Association for Regional Cooperation),
2. BIMSTEC (Bay of Bengal Multi-Sectoral Technical and Economic Cooperation),
3. Indian Ocean Rim Association (IORA).
Defence and Security:
- Joint Exercises: Army (Exercise Sampriti) and Navy (Exercise Bongo Sagar).
- Counterterrorism and Counter-Radicalisation initiatives
Other Services:
- E-Medical Visa Facility: India introduced e-medical visas for Bangladesh citizens.
- 350 training slots for Bangladeshi police officers and the Muktijoddha Scheme for medical patients.

India-Bangladesh Relations Under Sheikh Hasina

Trade Growth: Bilateral trade reached $13 billion in FY 2023–24, with Bangladesh becoming India’s largest trade partner in South Asia.
Land Boundary Agreement (2015): Resolving long-standing border disputes marked a significant achievement in bilateral relations.
Key connectivity projects: Successful implementation of cross-border rail links and port agreements. For example, India uses the Agartala-Akhaura rail link and the Chattogram and Mongla ports.
Defence and Medical Collaboration: Joint military exercises, such as the annual “Exercise Sampriti,” and the growth of medical tourism, where Bangladeshi citizens seek medical treatment in India.
Enhanced Security Collaboration: Hasina’s government helped dismantle anti-India militant groups, improving regional security.
Energy Partnerships: Bangladesh imported substantial electricity from India, and the India-Bangladesh Friendship Pipeline facilitated fuel transport.

Challenges Ahead for India

Political Uncertainty: A less friendly administration could reinvigorate anti-India militant groups, exacerbating border security tensions.
Geopolitical Dynamics: Instability in Bangladesh could enable China to expand its influence, necessitating India’s vigilance as Beijing might offer lucrative deals to any new regime, similar to its actions in Sri Lanka.
Economic Implications:
- Disruptions in trade and payment delays impact the profitability and stability of these investments.
- Indian-owned textile manufacturing units in Bangladesh, which constitute around 25% of the sector, may shift operations back to India due to instability.
- It raises doubts about the future of the potential free trade agreement (FTA).
Infrastructure and Connectivity Risks:
- India has provided USD 8 billion in credit since 2016 for road, rail, and port projects, including the Akhaura-Agartala rail link and the Khulna-Mongla Port rail line.
- Current unrest threatens to disrupt trade and access to India’s Northeast region.

Teesta Water Sharing Agreement

About Teesta River

The Teesta River originates from the Pahunri (or Teesta Kangse) glacier in the Eastern Himalayas in the state of Sikkim, India.
It flows southward through the Indian states of Sikkim and West Bengal, eventually entering Bangladesh.
In Bangladesh, it merges with the Brahmaputra River (known locally as the Jamuna River).
Major tributaries: Rangpo River, the Rangit River, and the Great Rangit River.

Key Events and Agreements

1983 Agreement:
- An ad-hoc agreement on the sharing of Teesta waters was reached in 1983, with Bangladesh allocated 36% and India 39% of the water flow, leaving 25% to be decided later.
- However, this agreement was never fully implemented.
1996 Ganges Water Treaty:
- Although this treaty primarily addressed the Ganges River, it set a precedent for bilateral cooperation on water-sharing between India and Bangladesh.
Attempts at a Comprehensive Agreement:
- In 2011, an attempt was made to resolve the dispute when Indian PM visited Bangladesh.
- Proposed agreement aimed at allocating 37.5% of Teesta’s waters to Bangladesh and 42.5% to India.
- However, West Bengal govt opposed it arguing that it would harm its agricultural interests.

Way Forward

Fostering New Alliances:
- Maintain a cautious “wait-and-watch” strategy to assess developments and their potential impacts on regional stability.
- Engage with various political factions in Bangladesh to foster a more inclusive relationship.
- Engage with a broader spectrum of Bangladeshi society to counteract negative perceptions of India and move beyond the 1971 liberation narrative.
Strengthening Security Measures: Bolster security measures along the border to address potential spillover effects and maintain stability.
Advancing Digital Connectivity: Develop a digital connectivity corridor to enhance trade, technological exchange, and e-commerce.
Strategic Geopolitical Maneuvering:
- Collaborate with international partners, including the US, UK, and European nations, to mitigate the risks of possible Chinese and Pakistan influence.
- Work with Gulf partners like the UAE and Saudi Arabia to support Bangladesh’s economic stabilization and counter extremist influences, maintaining regional stability.
Support for Democratic Processes: India should advocate for democratic principles and reforms in Bangladesh while avoiding direct political interference.
Address Critical Issues: Focus on resolving ongoing disputes, such as water sharing and the Rohingya refugee crisis, and manage cross-border challenges effectively.

Bangladesh-China Relations

Bangladesh’s two-way trade with China exceeded $25 billion in 2022.
Bangladesh aligns strategically with China, helping transform its landscape through mega projects.
Chinese investments in BRI-financed infrastructure projects have surpassed $10 billion.
Bangladesh has significant military relations with China, and it is the second-largest importer of Chinese arms.
- India, too, gave Bangladesh $500 million credit for defence imports.
Bangladesh has granted port access to India and China, fostering modernisation in Mongla port under the banners of the BRI and Bangladesh-China-India-Myanmar Corridor (BCIM).
- Pyra Port– A similar cooperative enhancement was undertaken, but India backed out due to the PPP being granted to a Chinese company.
There are around $450 million of Chinese investments into 1,845 MW of domestic power generation as of 2021.

Bangladesh-USA Relations

Bangladesh has had tense relationships with the US and the UK, given their proximity to Pakistan and their damaging role in 1971.
The present regime unsurprisingly views the US with tremendous distrust.
The US has been relatively inconsistent regarding calling out authoritarianism. While the Americans seldom talk about democracy in Pakistan, they tend to bully Bangladesh.
The US has begun to appreciate India’s interests in Bangladesh (After the G20 Summit) and is toning down its hostility toward Dhaka.