International Relations (India's Global Engagements: Neighborhood, Bilateral Relations, and Regional Groupings) by Viraj C. Rane

Model Answer

Question #1. Do you think that Bhutan’s foreign policy has evolved from being India centric to the country becoming   fulcrum between India and China? Give reasons for your answer.

Approach:

• Introduction: Bhutan’s relations with India and China and Bhutan as a buffer state.
• Body: Traditionally Bhutan follows an Indo centric policy but changing dynamics is forcing it to expand its reach to resolve order issue and balance the two Asian powers.
• Conclusion: India must deliver on its promises to keep Bhutan in its exclusive sphere of influence.

Bhutan is a small landlocked country located between two of Asia’s biggest economies—India and China. Bhutan has maintained a special relationship with India since the signing of the Treaty of Friendship and Cooperation in 1949. India views Bhutan as a “buffer” state against China’s aggression and military adventures. With China it maintains a neutral relationship with no diplomatic ties.

India centric:

• The basis for bilateral relations between India and Bhutan was formed by the Indo-Bhutan Treaty of Peace and Friendship of 1949. In 2007 the treaty was re-negotiated, and provisions were included to encourage Bhutan’s sovereignty, abolishing the need to take India’s guidance on foreign policy. Bhutan can import arms as long as Indian interests are not harmed.
• According to C. Raja Mohan: The new treaty put the relationship on a footing of mutual respect and equality. 
• Bhutan has been very sensitive to the interests of India and is seen to be in the hegemonic hold of India.
• In 2013, India, in an unambiguous signal, abruptly cut subsidies on gas and kerosene sales right before general elections. This was seen by Bhutan as a gesture by India for its overtures to China. This has caused resentment within the government and also the people.

Changing dynamics and the role of China:

• From the 1990s, China came up with a “package deal”, where in return for the smaller disputed Doklam area (close to the Chicken neck corridor in India) it was willing to give bigger territorial concessions in other disputed areas. The Doklam standoff in 2017 is seen as China’s way to force Bhutan to establish diplomatic ties and move away from India’s embrace.
• China had begun exporting farming and telecommunications equipment to Bhutan. Tourism from China generates lot of income.
• There is a growing demand within Bhutan to establish diplomatic ties to solve the border issue with China and move away from over dependence on India.

Views of Scholars:

• According to C. Raja Mohan has the democratic transition in Bhutan and its search for a larger international profile and the intensifying overtures from Beijing make the warming of Sino-Bhutanese ties inevitable.
• However, Harsh V Pant argues that Bhutan happens to be one of the few countries questioning China’s regional ambitions by not establishing diplomatic ties and demarcating territorial borders with the former. 

Conclusion:

Bhutan still remains closely linked to India. India has consistently assisted Bhutan by funding its hydroelectric power and major infrastructure projects, and providing it with subsidies, grants and currency swaps. India also accounts for 90 percent of Bhutan’s imports and 77 percent of its exports, following the Free Trade Agreement between the two countries. India also reassured Bhutan by standing up to the 2017 Chinese aggression in Doklam. Bhutan has reciprocated by being sensitive to the security needs of India by staying away from China. India must deliver on the pending hydroelectric projects and ensure that the trade deficit is minimal so that Bhutan can justify continuing its India-centric policy.

Question #2. Explain the role played by energy as an instrument of India’s foreign policy in South Asia.

Approach:

• Introduction: South Asia is energy deficient; Nepal and Bhutan have huge hydropower potential.
• Body: Analysis of energy co-operation between India and its neighbors.
• Conclusion: Energy is a crucial concept which can lead to collective prosperity and also pave way for regional integration.

South Asia as region with strong economic growth has led to increase in the consumption of energy and thus increase in the demand for energy. Recent studies on energy requirements in South Asia reveal that India, Pakistan, Bangladesh, Sri Lanka and Afghanistan have energy demand surpassing their domestic supply, while Bhutan and Nepal have energy resources, hydropower in particular, far in excess of their domestic needs that can be traded within the region. 

Energy has become an important instrument in India’s foreign policy tool kit is based on recognition that regional energy cooperation is crucial for mutually beneficial relations rather than one way trade of energy that India experiences with west Asian countries.

Bhutan 

• India and Bhutan signed one of the first hydropower cooperation pacts, in 1961, to harness electricity from the transboundary Jaldhaka river. Since then, energy cooperation has been growing strong with consequent, Chukha hydropower project.
• EAM Jaishankar has remarked that the hydro power sector has been the most visible symbol of the mutually beneficial bilateral cooperation between India and Bhutan 
• Besides helping Bhutan in generation of hydroelectricity, India is also its largest importer of electricity but one of the concerns is growing hydropower debt. 
• India and Bhutan took a major step forward for the construction of the 600 MW Kholongchhu project, their first hydropower joint venture project, it is the first time an India-Bhutan hydropower project will be constructed as a 50:50 joint venture, not as a government-to-government agreement.

Nepal

• India Nepal energy relations are based on a long-term approach in joint development of hydropower. Arun-III hydro power project is one.
• The two countries trade power under the Nepal-India Agreement on Electric Power Trade, which was finalised in 2014 

Sri Lanka 

• India and Sri Lanka signed an MoU to set up hybrid solar and wind farm in the three islands off Jaffna.

Bangladesh

• Deepening of cooperation in the area of power and energy connectivity includes projects such as India-Bangladesh Friendship Pipeline, and Maitree Super Thermal Power Project.
• Former Foreign Secretary Shringla said the IBFPP is a “very unique and significant pipeline that enable us to integrate our energy requirements”.
• India and Bangladesh have also inked the Framework of Understanding (FOU) on Cooperation in the Hydrocarbon Sector. This is expected to further enhance energy linkages by streamlining investments, promoting hydrocarbon connectivity, technology transfer, joint studies, and training.

Pakistan 

The two proposed pipelines under discussion are the Iran-Pakistan-India (IPI) pipeline and the Turkmenistan-Afghanistan- Pakistan-India (TAPI) pipeline. However, both projects face a number of issues because of hostile relations between Pakistan and India.

Maldives: India and Maldives plan to set up a transmission interconnection for transfer of renewable power between the two countries as part of One Sun, One World & One Grid initiative.

Conclusion:

Recently, there is talk about multilateral cooperation in power sector, which talks about expanding cooperation in power sector to include partner countries like BBIN. Energy connectivity and trade will form the basic pillar of regional economic integration which will pave the way for shared economic prosperity and development.