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september 20, 2014 vol xlIX no 38 EPW Economic & Political Weekly
Modi’s Neighbourhood Initiative
S D Muni
The initial optimism about an
improvement in bilateral relations
with Pakistan and Nepal has
largely evaporated. The Hurriyat
imbroglio first stalled the
Pakistan initiative and with Nepal
greater sensitivity needs to be
demonstrated to the concerns of
that country. Bureaucratic and
political hurdles have to be first
overcome and the shadow of
Hindutva hangs over India’s ties
with all of south Asia.
he euphoria generated by Prime
Minister Narendra Modi’s invitation
to the SAARC (South Asian Associa-
tion for Regional Cooperation) leaders
for the inaugural function of his regime
has started fading out. Two countries
seen as most critical to this initiative are
Pakistan and Nepal: Pakistan where af-
ter Prime Minister Nawaz Sharif’s visit,
India initiated the dialogue process
stalemated since 2012, by fixing the date
of foreign secretary-level talks and
Nepal, where both Prime Minister Modi
and Foreign Minister Sushma Swaraj
paid official visits in early August and
late July, respectively.
End to Pakistan Initiative?
The Pakistan initiative suffered a serious
roadblock with the Modi government’s
decision to call off the 25 August foreign
secretary-level talks in protest against
Pakistan’s continued engagement with the
Kashmir Hurriyat leaders. While welcom-
ing Prime Minister Nawaz Sharif at the
time of his swearing in, Modi had clearly
urged upon him to desist from meeting the
Hurriyat leaders. Even before the Pakistan
High Commissioner was scheduled to meet
the Hurriyat leader, Shabir Shah, Foreign
Secretary Sujatha Singh had warned that
such a meeting would result in the cancel-
lation of scheduled talks. Though this prac-
tice has almost a two-decade-old history,
and was endorsed both by the previous
National Democratic Alliance (NDA) and
United Progressive Alliance (UPA) regimes,
the Modi government had a point in end-
ing it. How long could India continue with
this practice of letting Pakistan represent
Kashmir in the name of the Hurriyat,
and to what results? It may be recalled
that the Hurriyat was created in 1993, out
of a large number of motley groups that
were supporting Pakistan-backed insur-
gency in Jammu and Kashmir. The idea
and support for this move came from the
combined efforts of the United States and
Pakistan to give voice and legitimacy to the
extremist fringe in the Kashmir Valley at
the cost of mainstream representative
forces like the National Conference and
the Peoples’ Democratic Party.
The previous governments carried on
with this arrangement in the hope that
Pakistan would be able to moderate the
Hurriyat leaders in facilitating a peaceful
solution of the Kashmir issue. However,
there has been no tangible success in
this respect so far. When in power, Gen
Musharraf even snubbed the Hurriyat
leaders and forced them to follow his
lead on the Kashmir issue while he was
working on his four-point formula through
backchannels with India. One wonders
if this had resulted in a resolution of the
dispute, Hurriyat would have welcomed
it. Pakistan has never accepted Hurriy-
at’s basic stand that they should be
brought on the negotiating table of the
Kashmir question between India and Pa-
kistan. There are now disclosures (by
former Prime Minister Atal Behari Vaj-
payee’s media adviser), that the Inter-
Services Intelligence of Pakistan assas-
sinated moderate Hurriyat leaders and
S D Muni ( is Professor
Emeritus at the Jawaharlal Nehru University
and distinguished fellow, Institute of Defence
Studies and Analysis.
Economic & Political Weekly EPW september 20, 2014 vol xlIX no 38
threatened others to persist with their
anti-India stance.
The biggest challenge now before the
Modi government is to constructively
engage with Pakistan without compro-
mising on its present stand. This would
be easier said than done, particularly in
view of Pakistan’s internal turmoil and
political uncertainty, which may result
in the weakening of the civilian govern-
ment and firmer control of the army on
administration and its India policy. Modi
government’s decision also sends a
strong message to all other neighbours
of India that if and when required, India
can be uncompromisingly tough.
Reviving India-Nepal Ties
In the case of Nepal, the visits of Modi
and Sushma Swaraj have radically altered
the atmospherics by making political-
level discourse between the two countries,
both pleasant and hopeful. Sushma Swaraj
with her three-day visit during 25-27
July broke the ice on the India-Nepal
Joint Commission which had remained
frozen for 23 years. Under the meeting
of this commission, “the entire gamut of
bilateral relations” between India and
Nepal was reviewed and both the sides
recommitted themselves to stepping up
cooperation in the areas of trade, hydro-
power, defence and security. India also
reiterated its willingness to “review, adjust
and update” the 1950 Treaty of Peace
and Friendship that constitutes the foun-
dation of relations between the two
countries, but has been a bone of conten-
tion from the Nepalese side for the past
50 years and more. Swaraj also had
extensive meetings with all the major
political leaders and assured them of
India’s respect and support for Nepal.
Sushma Swaraj’s visit greately facili-
tated Modi’s task of bridging the gradu-
ally widening trust deficit between India
and Nepal. This trust deficit also has a
long history and its recent intensity
could be gauged by the fact that India’s
ambassador to Nepal was booed with black
flags and shoes for the first time during
2009-2010, and there is virtually no bi-
lateral issue of significance where Nepal
does not have reservations on India’s
position. Modi was the first Indian prime
minister visiting Nepal in the past 17 years.
Modi addressed the question of the
trust deficit with Nepal at the political as
well as public levels in Nepal; in his ad-
dress to Nepal’s constituent assembly-
cum-parliament as also in the course of
interactions with all the major political
formations. He invoked India’s cultural
and civilisational bonds with Nepal. While
the majority Hindus of Nepal were
delighted to see Modi praying at the
Pashupatinath temple, he took care to
acknowledge the virtues and strength of
Buddhism as the religion of peace and
Nepal as the place of Buddha’s birth. He
underlined the inter-dependence be-
tween India and Nepal in the fields of
hydropower and security, and assured
Nepalese of India’s respect for Nepal’s
sovereignty and self-respect. The level of
bilateral engagement was raised from
the bureaucratic to political plane. He
praised Nepal’s unique peace process
that mainstreamed its 10-year-old Mao-
ist insurgency. The Maoists of Nepal
were particularly pleased by his clichés
like “from “Yudha (War) to Buddha
(Peace)” and “Shastra (arms) to Shastra
(scriptures)”. He aroused Nepal’s devel-
opmental aspirations by highlighting its
hydropower and tourism potentials and
offering India’s cooperation in taking
Nepal to prosperity and growth.
Internal Obstacles in Nepal
Everyone in Nepal and outside is acutely
aware that political instability and lack
of democratic institutionalisation have
been the principal obstacles to Nepal’s
development. Modi strongly urged the
Nepali lawmakers and political leaders to
complete the writing of their constitution
as scheduled. He did not shy away from
asserting that India as well as the whole
world has stakes in the timely comple-
tion of the constitution-writing process
because only then Nepal’s peace process
will reach its culmination, setting an ex-
ample of how violence and destruction
are transformed into stable democratic
governance. As agreed by almost every-
one in Nepal, Modi underlined that the
constitution will be “federal, democratic
and republican”. The reference to the re-
publican character of the constitution in
Modi’s address set at rest the speculation
that the new Indian government was
supportive of the revival of monarchy in
Nepal. However, the omission of the
word “secular” to characterise the evolv-
ing Nepali constitution in Modi’s address
and interactions in Kathmandu created
a mild flutter among the minorities who
do not favour the revival of Hindu state
in Nepal. Such fears have been aroused
in Nepal as the Vishva Hindu Parishad
leaders have been propagating the revival
of a “Hindu Rashtra” in Nepal.
It may be noted in this respect that
Sushma Swaraj in answer to a Hindutva
question had clearly stated that she took
her oath of office under a secular Indian
Constitution and was thus not committed
to advancing Hinduism elsewhere. It is
also useful to keep in mind here that
Nepal constitutionally became a “Hindu
Rashtra” only in 1962 and that too was
done at the behest of the monarchy which
wanted to legitimise its authoritarian rule
by invoking Hindu scriptures that project
a king as the incarnation of the Hindu
god, Vishnu. Prior to 1962, and since
2008, Nepal like India has remained a
predominantly Hindu society governed
by a secular state and there is no reason
why it cannot continue to be the same
under the new Nepali constitution.
An interesting omission, by both
Sushma Swaraj and Narendra Modi in
Nepal was any reference to China or India’s
regional security concerns. This was a pru-
dent and perhaps a calculated omission.
It avoided any possible irritation to China
and its supporters in Nepal. It also ensured
that the Nepalese do not take India as
being unduly preoccupied with China and
its presence in the neighbourhood. If
India’s economic engagement with China
is growing, how can India take any excep-
tion to any of its neighbours doing the
same? In any case, India’s security con-
cerns in Nepal for long have undergone
drastic changes. Far from outright mili-
tary interventions by China or any other
country, these concerns are now focused
on the use of Nepal by third countries in
areas inimical to India, such as in terrorism
and counterfeiting of Indian currency.
Aid for Nepal
Besides improving the atmospherics, Modi
also gave a firm indication to Nepal that
India was willing and prepared to walk
september 20, 2014 vol xlIX no 38 EPW Economic & Political Weekly
the talk in bilateral cooperation. He of-
fered a soft loan of $1 billion for Nepal’s
“infrastructure development and energy
projects as identified and prioritised
by the Government of Nepal”. India
agreed to undertake the construction of
Raxaul-Amlekhgunj oil pipeline and
reiterated its commitment to expand
rail and road links with Nepal. An Emi-
nent Persons Group was established to
look into the “totality of India-Nepal
relations”. Timelines were fixed for con-
cluding negotiations on “the agreement
on trade in the power sector” and a
number of other agreements. Above all,
Modi endorsed the Joint Commission
decision to “review, adjust and update”
the 1950 Treaty.
All this, however, does not constitute
more than a sincere new beginning. It
will take a long time and serious efforts
for the promises of Modi’s neighbour-
hood initiative in Nepal and Nepal’s ex-
pectations from the new Indian govern-
ment to be turned into a reality. Formi-
dable challenges lie at two levels; one at
the level of Indian and Nepali bureauc-
racies and another at the level of inter-
nal political consensus within Nepal on
how to engage with India.
Bureaucratic Stubbornness
On the Indian side of bureaucracy, Modi
knows that it is not an easy task. He
admitted that in so many words in his
Independence Day address from Red Fort.
There are moves on his part to stream-
line Indian bureaucratic decision-making,
improve intra- and inter-departments and
ministries coordination and ensure that
there is no delivery deficit between policy
and performance. It remains to be seen
as to how and when these moves will
start yielding results and if they will also
apply in the area of foreign policy. India
has seen prime ministers come and go but
the bureaucratic structure has remained
in place. The idea of administrative re-
forms has remained largely a promise and
a wish unfulfilled. One hopes that before
Modi streamlines the bureaucracy, the
latter does not take over the former. There
are innumerable examples where bureau-
cratic processes have frustrated strategic
policy moves, especially in relation to
the neighbours. For instance, India took
a policy decision to review the Treaty of
1950 with Nepal almost two decades
ago, but nothing moved forward. Even
in the present context, the way the power
trade draft was presented by the Indian
side before the Swaraj and Modi visits
clearly reflected India’s indifference
towards Nepal’s sensitivities. The micro
issues involved in trade and transit,
power production and transmission in-
cluding the price of power, border de-
marcation and border management, etc,
will all need continuous accommodation
and understanding on the part of Indian
bureaucrats. There is a natural and gen-
uine clash of interests in all these areas
but the task of a strategic vision and di-
plomacy is to turn those friction points
into win-win solutions.
The Nepalese side of the bureaucracy
may face even bigger difficulties in rising
to the new expectations as their processes
and procedures of decision-making and
implementation have for long been inef-
ficient and directionless. When it comes
to India, there are deep layers of suspicion
and distrust cultivated through long
years of the monarchy’s dominance and
subsequent democratic dithering. Nepali
nationalism has been fed liberally on an
anti-India diet for all these years and the
bureaucracy has been directly influ-
enced and acultured by this.
Nepal’s approach towards India will not
improve unless this nationalism is recast
into a developmental mode. Modi’s visit
to Nepal has tried to give a well-meaning
push in this direction unleashing a lively
debate within Nepal on how to relate to
India. In this debate there is no dearth of
voices that have not only dismissed Modi’s
visit as being nothing more than rhetorical
and patronising, but have also persisted
in doubting India’s real intentions in
Nepal. Much of the direction of this
debate will be decided by the evolving
political dynamics of Nepal.
Politically, all the parties in Nepal are
deeply divided internally owing to per-
sonality clashes and power struggles. In
all these fault lines India is a major con-
tentious issue. All those political leaders
who will happily seek quiet support
from India in the accretion of their power
and influence at the party as well as
national levels will display an irresistible
tendency to show off their distance and
independence from India in public. India
will be used as a convenient whipping
boy by the parties and the political lead-
ers in their rivalries and conflicts. This is
the reason why many of the agreements
formally entered into have remained ly-
ing in files. No constructive proposal has
ever been forwarded by Nepal on coop-
eration in the harnessing of common
water resources and Nepal’s huge hydro-
power potential. The bilateral investment
agreement signed by Nepal’s prime min-
ister with India in 2011 was publicly op-
posed by his own foreign minister,
though the latter was present at the time
of signing. For the past three years, in-
tra-party differences have not allowed
the Nepalese government to appoint an
ambassador to India. One should, there-
fore, not expect much on the ground un-
less there is a robust national consensus
among the major political parties and
their leaders in Nepal that they have to
join hands with India in marching
towards the developmental goals.
Shadow of Hindutva
The difficulties that stare in the face of
Modi’s neighbourhood initiative in Nepal
and Pakistan may apply equally to other
neighbours as well. Polities are highly
polarised in Afghanistan, Bangladesh,
Maldives, Sri Lanka, Myanmar and also
in Bhutan. In most of these countries,
India is an important issue along the
polarising axis. In all these countries,
there is also a serious national identity
issue which comes in the way of closer
economic integration or social and stra-
tegic cooperation with India. Modi’s Hin-
dutva flavour that was robustly displayed
during the Nepal visit may create greater
complications to the identity issue in
Pakistan, Bangladesh and Maldives. The
strategists in all these neighbouring
countries prefer playing India vis-à-vis
China and other major powers to reap as
many strategic and economic benefits as
possible rather than get themselves
closely identified with India alone. The
lure of China’s huge resources and gen-
erous offers often heavily outweigh what
India can promise and deliver. India,
therefore, faces a formidable task in
streamlining its neighbourhood approach.