Relevance: GS-2: Bilateral, Regional, and Global Groupings and Agreements involving India and/or affecting India’s interests.

Key Phrases: India’s Leadership, South Asian Flux, South Asian governance, Corruption and misgovernance, political instability, political apathy, and poor governance, Neighbourhood first policy, South Asian Free Trade Agreement.

Why in News?

• At a time of multiple global disruptions unfolding almost simultaneously, it is easy to forget that South Asia has always been a turbulent region.
• Political and economic challenges have continued unabated in a region that hosts around a quarter of the world’s population with simmering inter - as well as intra-State rivalries.

Challenges in the South Asian governance:

• Sri Lanka:
  • The unfolding economic and political crisis in Sri Lanka has once again underscored the challenges of South Asian governance.
  • Corruption and misgovernance of the Sri Lankan political elites have exposed the vulnerabilities of an island nation that was seemingly doing rather well till a few years ago.
  • The fall has been dramatic and the inability of the Sri Lankan political class to manage the crisis has been equally revealing.
  • The Sri Lankan crisis is creating a new awareness in other South Asian nations about the vulnerabilities within their economic structures.
• Nepal:
  • Concerns have been expressed about the economic underpinnings of Nepal, though its external debt situation is not that serious.
  • But it is political apathy and poor governance that are the real issues that need tackling.
• Myanmar:
  • Myanmar, reeling under western sanctions and pandemic-induced declining economic productivity, is facing serious troubles but the military junta remains adamant about further isolating itself, as exemplified by the execution of pro-democracy activists.
• Bangladesh:
  • Even Bangladesh is seeking help from the IMF to ward off a potential economic crisis.
• Pakistan:
  • Pakistan has taken the challenge to another level with its political instability making it impossible to manage its dire economic crisis effectively.
  • It has struck a deal with the International Monetary Fund for a $6 billion loan programme, but it needs $41 billion in foreign exchange over the next 12 months.
  • Pakistan’s government remains unstable and unable to make any difficult choices.
  • There is a gathering storm of political turmoil and economic distress that none of Pakistan’s traditional partners, least of all China, will be able to help in managing.

What does India need to do?

• Keeping its own growth intact:
  • It has to first ensure that its economic fundamentals remain strong, and it continues to remain on an upward growth trajectory.
  • The Indian economy cannot remain completely immune from global and regional economic trends and will have to navigate its way forward carefully.
• Focusing on Neighbourhood first policy:
  • India’s help to South Asian countries by prioritizing neighbouring countries in its pursuit of foreign policy objectives, particularly by extending help to Sri Lanka and Afghanistan in their time of crisis, is a testimony to New Delhi’s importance to its Neighbourhood First policy.
• Sustained engagement:
  • Sustained engagement with the neighbouring countries will facilitate creating a cordial atmosphere in the region, which has been a constant impediment to establishing stability, trust, and progress.
  • Stability will enable India to pursue its foreign policy goals and facilitate growth and development in other South Asian countries.
  • By extending necessary assistance, India can strengthen its position in the region and achieve both economic and strategic depth vis-à-vis China.
  • Therefore, there is a greater need for sustained engagement with its neighbouring countries.
• People-to-people contact:
  • Priority should be given to people-to-people connections and deep cultural affinities for sustained cordiality and stability.
  • Further, the focus should be given to prompt delivery of its commitments for the overall development of the region.
• Promoting Sub-Regional Initiatives:
  • Strengthening of sub-regional initiatives such as the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation and the South Asian Association for Regional Cooperation (SAARC) can maximize regional interests.
• Improving Regional Trade:
  • India could leverage regional trade, connectivity, and investment, and strengthen the South Asian Free Trade Agreement as a game-changer for the region.
  • One step that could dramatically galvanize economic energies would be to lower barriers to intra-regional food trade and encourage regional supply chains.

India’s response to the Sri Lankan crisis:

• As the crisis mounted in Sri Lanka, India was proactive in keeping the interests of the Sri Lankan people at the heart of its policy response.
• It committed $3.8 billion to Sri Lanka and supplied fuel, rations as well as over 44,000 metric tonnes of urea under a credit line to help Lankan farmers.
• China’s silence despite owning a large part of Sri Lankan debt and India’s very visible help at a time of great need are factors that will shape the contours of regional politics for some time to come.
• At a time when South Asia is widely viewed as a central pillar of the wider Indo-Pacific maritime geography and when major power contestation is rising by the day, for many states in South Asia and beyond, this moment is a critical one.
• The contrast between Indian and Chinese responses is being registered globally.

Conclusion:

• India’s rise as a serious global player today allows it to leverage its role in mobilizing multilateral institutions and other major powers to support its neighbours in tiding over the present crisis.
• New Delhi should do this with a sense of urgency and to some extent, it has already begun.
• New Delhi’s leadership during the Covid-19 crisis has generated a new sense of expectation and the multiple crises brewing in the neighbourhood should also be seen as an opportunity to project an India that takes its regional responsibilities with the seriousness they deserve.

Source: ORF-Online

Mains Question:

Q. In times of turmoil in the South Asian region, India can play a leadership role in driving South Asia forward. Discuss.