Neighbours, Big & Small – Bhutan to Bangladesh, New Delhi must prepare to compete with China in the development space

Source: The post is based on the article “Neighbours, Big & Small – Bhutan to Bangladesh, New Delhi must prepare to compete with China in the development space” published in The Times of India on 30th March 2023.

Syllabus: GS – 2: India and its neighbourhood- relations.

Relevance: About Indian neighbours’ policy.

News: Recently, Bhutan has said that China has an equal say in resolving the Doklam dispute. This is different from Bhutan’s 2019 position which said that the tri-junction point between India, China and Bhutan at Doklam should not be unilaterally disturbed. This shows that Bhutan is taking a more accommodating stance on China because of current geopolitical realities.

What are the challenges faced by Indian neighbours in India – China tussle?

While India and China are locked in their own border disputes along the LAC, other countries in the neighbourhood fear getting caught in the tussle. So, they will sometimes stay away from the two Asian giants’ tussle.

Read more: India failed to create positive impression among businesses moving away from China, says House panel report

What are the impacts of Indian neighbours’ policy on India?

Indian neighbours’ inaction policy presents a strategic challenge for India. This is because of China’s dollar diplomacy and its advantage on Indian neighbours. For instance, a recent report highlights, China has handed out $240 billion worth of bailout loans to 22 developing countries over two decades. Around 80% of those funds were provided between 2016 and 2021 when Beijing’s BRI projects picked up steam.

Must read: China ramping up bailout loans to BRI countries: Report

On the other hand, forcing Nepal, Bangladesh, and Sri Lanka to let go of Chinese funds will have the opposite impact and build up resentment against India. For example, the 2015 blockade in Nepal has seriously hurt Indian interests.

Similarly, relations with Bangladesh might be hamper if the Bangladesh government is unable to balance ties with India with Bangladesh’s development imperatives.

What India should do?

India needs to switch to a smarter approach, drop the Big Brother attitude and work on its own attractiveness by timely completion of development projects. India should also sharpen our ‘Neighbourhood First’ policy.

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