Saturday, June 19, 2021

India & Bangladesh: Furthering Bilateral Ties

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The visit of Indian Foreign Secretary, Harsh Vardhan Shringla, to Dhaka reflects the enduring close ties that India shares with Bangladesh. The bilateral relationship has particularly received a boost under Bangladesh’s present Awami League government led by Prime Minister Sheikh Hasina. Mr. Shringla’s visit is significant as he has served in Dhaka till January 2019 as India’s High Commissioner to Bangladesh and played a leading role in taking the bilateral relations forward. Moreover, in the recent past, Dhaka had expressed reservation on domestic developments in India which it feared may have implications domestically. However, Prime Minister Narendra Modi has assured Dhaka that developments in India will not have any impact on Bangladesh and Dhaka has been briefed at the official level.

The main reason for Foreign Secretary’s visit was to prepare the ground for Prime Minister Modi’s visit in the middle of this month to participate in the birth centenary celebrations of Bangabandhu Sheikh Mujibur Rahman. Prime Minister Modi had said, Sheikh Mujibur Rahman is our national hero too. There are several other issues that the two countries would be discussing in the coming weeks.

Relations between Dhaka and Delhi has seen an upward swing in last few years, buoyed by several steps that the two countries have taken to address each other’s concerns. The landmark land boundary agreement, and settlement of the maritime boundary through international arbitration laid to rest nagging complaints regarding India’s approach to these issues. Demarcation has improved the policing of the borders and has reduced the border flare ups as one had witnessed during the Pyrdiwah incident in 2001. Yet, the incidents of firing at the border, sometimes; reflects the illegal activities that continue to challenge and makes guarding of the borders difficult.

Bilateral trade has seen upward swing as New Delhi extended duty free access to 61 items, mostly in textiles in 2011. According to Export Promotion Bureau (EPB) data, Bangladesh’s exports to India stood at $1.25 billion, up by 42.91%, which was $873.27 million in the previous fiscal reflecting how Dhaka’s exports have grown over the period. As Bangladesh is growing at more than 7 per cent per annum, bilateral trade would receive further boost. Non-tariff barriers, however, remain a major road block. With connectivity and infrastructure projects that are being implemented and the proposed Bangladesh Bhutan India Nepal (BBIN) Motor Vehicles Act (MVA) and BIMSTEC MVA, bilateral trade is likely to touch a new high. Energy trade and improved navigation through the water-ways is going to play a significant role in trade and commerce.

It is likely that the Defence cooperation may come up for discussing between the two countries, during Prime Minister Modi’s visit to Dhaka later this month. Though India extended a $500 million defence credit line, the two countries are still negotiating its implementation. Perhaps it is time now to give a further push to implement this credit line. The two countries had also signed a MoU in 2019 for setting up Coastal Surveillance system. Further discussions on this may take place during the visit. The two countries already have the ‘Sampriti’ series of anti-terror exercises and also have coordinated patrolling to address common security concerns.

Implementation of the $7.5 billion line of credit requires urgency. According to reports, only 51 per cent of the four credit lines extended over an 8 year period has been utilised. Three rail projects involve $510.12 million which were earmarked under various lines of credit, of which only $87.70 million has been used till December 2019. Dhaka has been slow to prepare project reports for disbursement of the funds. Therefore, some of the projects has incurred cost escalation.

People to People contacts have grown over past few years with the introduction of new trains and buses. Introduction of separate medical visas and relaxation of norms for granting visa under the Indian government’s ‘’Neighbourhood First” policy is another important development. In this backdrop, the Indian Foreign Secretary’s visit signifies continuation of engagement between the two countries at the highest level.

Script: Dr. Smruti S Pattanaik, Strategic Analyst on South Asia

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