Sunday, February 19, 2012

India and its near-abroad-The elephant in the region

Competition with China is making it nicer, but India could do still more to sweeten relations with its neighbours

SOUTH ASIA is about the least integrated part of the world. Neighbours supply just 0.5% of India’s imports, and consume less than 4% of its exports. India and Pakistan, mutually antagonistic, account for a fifth of all living humans, yet their bilateral trade is puny, at less than $3 billion a year. The main regional body, the South Asian Association for Regional Co-operation, is an irrelevance. Diplomatic torpor usually reigns in the region: last week, when the elected president of one member country, the Maldives, was toppled in a coup, there was a resounding silence from the neighbours.

India, the regional superpower, is largely to blame. Though it is a democracy and has easily the biggest economy and armed forces in South Asia, it has rarely been a force for good. Instead it has treated the neighbours, by turns, with negligence and high-handedness.

Ideology and size are largely to blame. Economic self-sufficiency—the doctrine that informed Indian policymaking for nearly half a century after independence—made co-operating with the neighbours unnecessary. And India’s size—its population is seven times that of its nearest neighbour, Pakistan—has encouraged bullying tendencies. It has meddled in Nepal’s politics, and in the early stages of Sri Lanka’s civil war it backed Tamil guerrillas. Even today the opposition in Bangladesh claims nefarious Indian influence, and Pakistan says its old foe is supporting separatists in the province of Baluchistan. It has offered no evidence for the claim. But past Indian arrogance makes neighbours ready to believe anything.

This is an economic as well as a diplomatic problem. Lack of integration helps to keep South Asians poor. By one estimate, without barriers trade between India and Pakistan would grow nearly tenfold. Today the main border-crossing near Pakistan’s eastern city of Lahore is at times almost deserted. If educated Sri Lankans were allowed to work in India, they could get good jobs there instead of having to take menial work in the Gulf, thus easing a growing shortage of skilled Indian workers. A regional energy market could boost prosperity; and Indian engagement in the problem of water-sharing could reduce dangerous tensions on the issue.

As a measure of India’s priorities, consider that the world’s second-most-populous country has no more diplomats than tiny New Zealand. By contrast, China has a huge and sophisticated foreign service, housed in sleek new embassies around the world. And it is partly with an eye to a rising China that India now shows signs of change.
Niceness contest

These days India is putting more effort into improving neighbourly relations (see article), and is dishing out aid to sweeten the air. The foreign minister, S.M. Krishna, vows never to meddle inside another country. This week the trade minister led a business delegation to Lahore. And for all the accusations of anti-Pakistan meddling in Afghanistan, Indian efforts are accomplishing some good there: training police, and building roads and electricity lines. All over the region, India is opening new consulates. It may even recruit more diplomats.

But there is much more that India could do. It should unilaterally boost regional trade by unclogging roads, and by building better ports and freight parks at its borders. Non-tariff barriers—including the one that insists Pakistani cement crosses the border only by train, not lorry—should go. And India could take lessons from other big emerging powers, such as South Africa and Brazil, on how to build relationships in the region. Elephants must learn to move carefully, for fear of causing damage in the neighbourhood. The Economist

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