The Growth of India-Bangladesh Ties

Syllabus: GS 2/International Relations 

In Context

• The External Affairs Minister emphasised the significance of the bilateral relationship between India and Bangladesh, labelling it as a “model relationship” in the Indian subcontinent.

India-Bangladesh Relations

• Beginning: India’s relationship with Bangladesh is anchored in common history, heritage, culture and geographical proximity, the foundation of which was laid in the 1971 Bangladesh Liberation War.
  • India provided critical military and material support to assist Bangladesh in its fight for independence from Pakistan. This became a primary factor in shaping the newly independent nation’s policy, as acknowledged by ‘Bangabandhu’ Sheikh Mujibur Rahman: “Friendship with India is a cornerstone of the foreign policy of Bangladesh.”
    • But There was a rise in anti-India sentiment in the mid-1970s over issues ranging from boundary disputes and insurgency to the sharing of water. 
• Economic cooperation: Bilateral trade between India and Bangladesh has grown steadily over the last decade. 

• Bangladesh has emerged as India’s largest trade partner in South Asia, with bilateral trade reaching $18 billion in 2021-2022 from $10.8 billion in 2020-21, though there was a dip in 2022-23 due to the pandemic and the Russia-Ukraine war.
•  India is also the second biggest trade partner of Bangladesh, with exports amounting to $2 billion in Indian markets.
• In 2022, both nations concluded a joint feasibility study on a Comprehensive Economic Partnership Agreement (CEPA).
  • The agreement, typically designed to reduce or eliminate customs duties on traded goods and simplify trade norms, is anticipated to open up broader social and economic opportunities. 
• The CEPA gains additional significance as Bangladesh is set to lose its Least Developed Country (LDC) status after 2026, thereby losing its duty-free and quota-free market access in India. 

• Infrastructure: As a “major development partner” of Bangladesh, India is funding several infrastructure and connectivity projects.
  • Since 2010, India has extended Lines of Credits worth over $7 billion. 
  • The Akhaura-Agartala rail link was inaugurated that connects Bangladesh and the northeast through Tripura.
    • It is likely to boost small-scale industries and develop Assam and Tripura.
  •  The Maitree Express connecting Kolkata with Dhaka was started in 2008 after a hiatus of over 40 years.
  • Bangladesh is also part of the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) which has its headquarters in Dhaka.
    •  The group is a multilateral regional organisation established to improve cooperation between littoral and adjacent countries in the Bay of Bengal region. 
• In the energy sector, Bangladesh imports nearly 2,000 megawatts of electricity from India. 
• Agreements : The two countries successfully resolved long-pending issues, like the land boundary agreement (LBA) in 2015 and a maritime dispute over territorial waters.
  •  In September 2022, India and Bangladesh inked an agreement on the sharing of the waters of the common border river Kushiyara — the first such pact since the Ganga Waters Treaty of 1996. 
  • The two countries are members of various regional trade agreements such as the Asia Pacific Trade Agreement (APTA), the SAARC Preferential Trade Agreement (SAPTA) and the Agreement on South Asian Free Trade Area (SAFTA) which govern the tariff regimes for trade. 

Issues and Concern

• The looming Teesta dispute will take centre-stage in the agenda of the Hasina-led government. 
• Teesta dispute : The issue revolves around the sharing of Teesta’s waters, with Bangladesh seeking an equitable distribution.
• Rohingya issue: The Bangladesh government aims for the peaceful repatriation of Rohingyas to Myanmar, but it’s talks with the military junta have been unsuccessful so far.
  • Bangladesh seeks India’s cooperation to influence Myanmar, but the Modi government, which has ties with the junta, asserts that it will deport Rohingyas from its mainland. 
• Cross-border terrorism and infiltration are additional threats to internal security. The rise of majoritarian forces adds another layer to the complex landscape.
  • While violence against Muslims has increased in India in the past few years, PM Hasina has stood at the forefront to condemn the attacks and express displeasure over comments by Indian leaders on “illegal” immigrants.
• China Factor: India’s concern is the deepening relationship between Bangladesh and China, marked by the substantial Chinese investments in infrastructure in recent years. 

Way Forward

• India considers Bangladesh a critical ally in the region.
  • a 4,096-km border, the India-Bangladesh border is the longest land boundary India has with any of its neighbours.
• India will look to advance its interests with the Awami League government, in line with its ‘Act East’ policy to counter China’s expanding influence in the Indo-Pacific and build a friendly and stable neighbourhood.
• The foreign policy alignment between the two nations promises increased collaboration in traditional and new areas, and provides an opportunity for the two countries to address unresolved conflicts.
• Both the countries are poised to take forward discussions on a FTA to enhance their economic partnership and boost investments