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 UNIT-1
CHAPTER NO CHAPTER NAME PAGE NO
1 INDIA-AUSTRALIA BILATERAL RELATIONS 1
2 INDIA-CANADA BILATERAL RELATIONS 6
3 INDIA-FRANCE BILATERAL RELATIONS 10
4 INDIA-GERMANY BILATERAL RELATIONS 16
5 INDIA-ITALY BILATERAL RELATIONS 21
6 INDIA-ISRAEL BILATERAL RELATIONS 25
7 INDIA-JAPAN BILATERAL RELATIONS 31
8 INDIA-RUSSIA BILATERAL RELATIONS 37
9 INDIA-UNITED KINGDOM BILATERAL RELATIONS 44
10 INDIA-US BILATERAL RELATIONS 49

UNIT-2

1 INDIA – AFRICA BILATERAL RELATIONSHIP 58

2 INDIA – BRAZIL BILATERAL RELATIONSHIP 65
3 INDIA – IRAN BILATERAL RELATIONSHIP 71
4 INDIA – WEST ASIA RELATIONSHIP 79
5 INDIA – UAE BILATERAL RELATIONSHIP 88
6 INDIA – SAUDI ARABIA BILATERAL RELATIONSHIP 93

UNIT-3

1 INDIA – AFGHANISTAN RELATIONSHIP 97

2 INDIA - BANGLADESH 106
3 INDIA – BHUTAN RELATIONSHIP 118
4 INDIA – MALDIVES RELATIONSHIP 124
5 INDIA – CHINA RELATIONSHIP 134
6 INDIA – NEPAL RELATIONSHIP 143
7 INDIA – PAKISTAN RELATIONSHIP 151
8 INDIA – SRI LANKA RELATIONSHIP 160
9 INDIA – MYANMAR RELATIONSHIP 169

UNIT-4

1 NON ALIGNMENT MOVEMENT (NAM) 177

UNIT-5

1 ASIA-PACIFIC ECONOMIC COOPERATION (APEC) 181

2 ASSOCIATION OF SOUTH EAST ASIAN NATION (ASEAN) 185
3 BRICS 191
5 GROUP OF 8/GROUP 7 201
6 GROUP OF 20 205
7 GROUP OF 4 208
8 INDIAN OCEAN RIM ASSOCIATION (IORA) 210
9 SOUTH ASIAN ASSOCIATION FOR REGIONAL COOPERATION (SAARC) 214
10 SHANGHAI COOPERATION ORGANIZATION (SCO) 221
11 NON ALIGNMENT MOVEMENT (NAM) 225
12 ARCTIC COUNCIL 228
13 ASIAN INFRASTRUCTURAL INVESTMENT BANK (AIIB) 231
14 CONVENTION ON INTERNATIONAL TRADE IN ENDANGERED SPECIES OF WILD 234
FAUNA AND FLORA) CITES
15 UNITED NATIONS FRAMEWORK CONVENTION ON CLIMATE CHANGE 237
(UNFCCC)
16 UNITED NATIONS CONVENTION ON BIOLOGICAL DIVERSITY (UNCBD) 241
17 NEW DEVELOPMENT BANK 245
18 AFRICAN DEVELOPMENT BANK 247
19 ORGANIZATION OF ISLAMIC COOPERATION (OIC) 248
20 SOUTH ASIA CO-OPERATIVE ENVIRONMENT PROGRAMME (SACEP) 251
21 INDIA-BRAZIL-SOUTH AFRICA (IBSA) 253
22 GULF COOPERATION COUNCIL (GCC) 256
23 EUROPEAN UNION 259
24 COMMONWEALTH OF NATIONS 264

UNIT-6

1 UNITED NATIONS 267

2 INDIA AND UNSC REFORM 278
3 INTERNATIONAL MONETARY FUND (IMF) 283
4 BRETTON WOOD CONFERENCE 287
5 WORLD TRADE ORGANISATION (WTO) 289
6 ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT (OECD) 295
7 ORGANISATION OF THE PETROLEUM EXPORTING COUNTRIES (OPEC) 298
8 INTERNATIONAL COURT OF JUSTICE 303
9 INTERNATIONAL CRIMINAL COURT (ICC) 308
10 INTERPOL 310
11 FINANCIAL ACTION TASK FORCE (FATF) 313
12 INTERNATIONAL UNION FOR CONSERVATION OF NATURE AND NATURAL 316
RESOURCES (IUCN)
13 INTERNATIONAL LABOUR ORGANISATION (ILO) 318
14 WORLD INTELLECTUAL PROPERTY ORGANISATION (WIPO) 322
15 INTERNATIONAL SOLAR ALLIANCE (ISA) 327
16 WORLD BANK 330

UNIT-7

1 DOUBLE TAX AVOIDANCE AGREEMENT (DTAA) 334

2 WASSENAAR ARRANGEMENT 336
3 NON-PROLIFERATION TREATY (NPT) 338
4 NUCLEAR SUPPLIER GROUP (NSG) 341
5 HAUGE CODE OF CONDUCT (HCOC) 345
6 UNITED NATIONS CONVENTION ON THE LAW OF THE SEA (UNCLOS) 346
 (UNIT-1) CH-1 INDIA-AUSTRALIA BILATERAL
RELATIONS
Basic and Backgrounds

▪ The India-Australia bilateral relationship has undergone evolution in recent years, developing along a positive
track, into a strategic partnership.
▪ The two nations have much in common, underpinned by shared values of a pluralistic, Westminster-style
democracies, Commonwealth traditions, expanding economic engagement and increasing high level interaction.
▪ The historical ties between India and Australia started immediately following European settlement in Australia
from 1788. All trade to and fro from the penal colony of New South Wales was controlled by the British East
India Company through Kolkata.
▪ India and Australia established diplomatic relations in the pre-Independence period, with the establishment of
India Trade Office in Sydney in 1941.
▪ The end of the Cold War and simultaneously India’s decision to launch major economic reforms in 1991 provided
the first positive move towards development of closer ties between the two nations. With the passage of time, the
relationship gained momentum towards a strategic relationship, alongside the existing economic engagement.
▪ India-Australia Strategic Relationship: With the changing global scenario, Australia has come to look at India
as an important partner in promoting regional security and stability. This led to up gradation of bilateral
relationship to a ‘Strategic Partnership’, including a Joint Declaration on Security Cooperation in 2009. Over
the years an array of institutional mechanism has been put in place to promote bilateral co-operation.
▪ Bilateral mechanisms include high level visits, Annual Meetings of Prime Ministers, Foreign Ministers’
Framework Dialogue, Joint Trade & Commerce Ministerial Commission, India-Australia '2+2' Foreign
Secretaries and Defence Secretaries Dialogue, Defence Policy Talks, Australia-India Education Council,
Defence Services Staff Talks, Energy Security Dialogue, JWGs on different issues etc.
▪ Australia's White Paper on Foreign Policy released in November 2017 sees India in the front rank of Australia’s
international partnerships. It says, “Beyond an increasingly important economic relationship, our security interests
are congruent, particularly in relation to the stability and openness of the Indian Ocean. Both the countries have
common interests in upholding international law, especially in relation to freedom of navigation and maritime
security”.

1
Political

▪ The two-way Prime Ministerial visits in 2014 built significant momentum in the bilateral relationship, signifying
deepening relations.
▪ India-Australia '2+2' Foreign Secretaries and Defence Secretaries Dialogue: India and Australia agreed in
2015 to hold annual meetings of Foreign and Defence Secretaries (2+2) to enhance foreign policy and security
cooperation; The 3rd Dialogue was held in New Delhi on 09 December 2019.
▪ India-Australia-Japan Trilateral Dialogue: The inaugural Secretary-level trilateral talks between India,
Australia and Japan was held in New Delhi in June 2015. The second Foreign Secretary level trilateral talks
were held in Tokyo on 26 February 2016 and the third took place in Canberra on 29 April 2017. The 4th India-
Australia-Japan Trilateral Dialogue was held in New Delhi on 13 December 2017.
▪ Indonesia-Australia-India Trilateral Dialogue: The 1st Indonesia-Australia-India Senior Officials’ Strategic
Dialogue was held in Bogor, Indonesia on 27th November 2017. The second dialogue in Canberra on September
21, 2018 and the 3rd in New Delhi on 19 November 2019.
Bilateral Economic and Trade Relationship

▪ The India-Australia economic relationship has grown significantly in recent years.

▪ As part of its efforts to develop strong economic relationship with India, the Australian side accepted some
recommendations of the India Economic Strategy, prepared by Australian Think Tank, to define a pathway for
Australia to unlock opportunities offered by Indian Economic growth.
▪ The strategy aims for a clear exposition of the kind of relationship Australia should aspire to have with India out
to 2035. The paper was released on July 12, 2018. The Paper identifies ten key sectors (Education as flagship
sector; Agribusiness, Resources and Tourism as lead sectors; Energy, Health, Financial Services, Infrastructure,
Sports, Science & Innovation as Promising Sectors) and ten states in India (Andhra Pradesh, Delhi NCR,
Gujarat, Karnataka, Maharashtra, Punjab, Tamil Nadu, Telangana, UP and West Bengal) where Australia should
focus efforts.
▪ India is the 5th largest trade partner of Australia with trade in goods and
services at A$ 29 billion representing 3.6% share of the total Australian trade in 2017-18, with export at
A$ 8 billion and import at A$ 21 billion.
▪ India’s main exports to Australia are Refined Petroleum, medicaments, while our major imports are
Coal, copper ores & concentrates, Gold, and education related services.
Civil Nuclear Cooperation

▪ A Civil Nuclear Cooperation Agreement between the two countries was signed in September 2014 during the
visit of the Australian Prime Minister to India. The agreement came into force from 13 November 2015.
▪ The Australian Parliament passed the “Civil Nuclear Transfer to India Bill 2016” on 01 December, 2016 which
ensures that Uranium mining companies in Australia may fulfil contracts to supply Australian uranium to
India for civil use with confidence that exports would not be hindered by domestic legal action challenging the
consistency of the safeguards applied by the IAEA in India and Australia’s international non-proliferation
obligations.
▪ It also ensures that any future bilateral trade in other nuclear-related material or items for civil use will also be
protected.

Defence Cooperation

▪ The Mutual Logistics Support Agreement has been signed during the summit that should enhance defence
cooperation and ease the conduct of large-scale joint military exercises.
▪ There is a technical Agreement on White Shipping Information Exchange.
▪ Recently Australia and India conducted AUSINDEX, their largest bilateral naval exercise, and there are further
developments on the anvil, including Australia’s permanent inclusion in the Malabar exercise with Japan.
▪ In 2018, Indian Air Force participated for the first time in the Exercise Pitch Blackin Australia. The third edition
of AUSTRAHIND (Special Forces of Army Exercise) was held in September 2018.

2
▪ A broader maritime cooperation agreement with a focus on Maritime Domain Awareness (MDA) is also in the
works and Australia has agreed to post a Liaison Officer at the Indian Navy’s Information Fusion Centre -
Indian Ocean Region (IFC-IOR) at Gurugram.

The Quad:
▪ The informal strategic Quadrilateral Security Dialogue (QSD) that
was initiated by Japan’s Prime Minister Shinzo Abe in 2007 was
largely in response to China’s growing power and influence.
▪ Initially, the “Quad” members included India, Japan, the US, and
Australia; however Australia chose to withdraw when Kevin Rudd
was Prime Minister, since it did not want to be a part of an anti-China
alliance at the time.
▪ However, Australia later re-joined the dialogue in 2017 on the side-lines of the ASEAN Summit, signalling a re-
ignition in Australia’s interest in the dialogue.
Agriculture, Science and Technology

▪ An Australia-India Strategic Research Fund (AISRF), which was established in 2006, supports scientists in
India and Australia to collaborate on leading-edge research. AISRF consists of India Australia Biotechnology
Fund; India-Australia Science & Technology Fund; Grand Challenge Fund and Fellowship Schemes.
▪ The fund, where each side contributes equally, supports large-scale research projects designed to deliver practical
solutions, focusing on energy, food and water security, health and the environment. Joint Committees on
S&T and Biotechnology have been established to administer the Fund.
▪ The Australian side is also cooperating in our Clean Ganga Project as agreed during visit of our PM to Australia
in 2014.
▪ Secretary (Water Resources, River Development and Ganga Rejuvenation) led a delegation to Australia
during 19-25 June 2016 for bilateral cooperation on water resource management, including discussion on Ganga
Rejuvenation.
▪ A four-member delegation led by Shri U. P. Singh, Secretary, Ministry of Water Resources, River Development &
Ganga Rejuvenation visited Canberra for attending 4th India-Australia JWG Meeting on July 11, 2018.
▪ Agreement on Cyber and Cyber-Enabled Critical Technology was signed.
Resource and Energy Cooperation

▪ A Joint Working Group on Energy and Minerals was established in 1999 to expand bilateral relationship in
the energy and resources sector. The 8th JWG meeting held in New Delhi in June 2013.
▪ As energy is one of the central pillars of economic cooperation, both sides agreed during the visit of our Prime
Minister to Australia in November 2014 to cooperate on transfer of clean coal technology and welcomed
Australia's desire to upgrade the Indian School of Mines, Dhanbad.
▪ The 9th JWG meeting in Brisbane in June 2015, provided the opportunity to discuss resources and energy
policy developments and reforms, including opportunities and challenges in mining; petroleum and gas;
power; new and renewable energy, as well as challenges in skills, science and innovation and infrastructure.
Education, Sports & Cultural Ties

▪ The Joint Working Group on Education between the two countries has identified several key areas for co-
operation, including collaborative research in education policy, student exchange programmes, capacity
building in vocational education and distance learning in higher education.
▪ Under the New Colombo Plan of Australian government, Australian undergraduates have studied and completed
internships in India
Indian Diaspora in Australia

▪ The Indian community in Australia continues to grow in size and importance, with the population of nearly
seven lakhs.

3
▪ India is one of the top sources of skilled immigrants to Australia. There is a constant flow of students and
tourists from India.
▪ India is now the third largest source of immigrants to Australia, after UK and New Zealand and the largest
source of skilled professionals for Australia.
▪ The growing significance of the community is reflected in the large-scale celebration of Indian festivals in
Australia, especially Deepawali.

An India Economic Strategy to 2035

▪ Australia’s Prime Minister has announced implementation of “An India Economic Strategy to 2035”, a vision
document that will shape India-Australia bilateral ties.
▪ It is based on three-pillar strategy- Economic ties, Geostrategic Engagement and Rethinking Culture-thrust on
soft power diplomacy.
▪ The focus of this report is on building a sustainable long-term India economic strategy.
▪ The report identifies 10 sectors and 10 states in an evolving Indian market where Australia has competitive
advantages, and where it should focus its efforts. These are divided into a flagship sector (education), three lead
sectors (agribusiness, resources, and tourism) and six promising sectors (energy, health, financial services,
infrastructure, sport, science and innovation).

Significance of Indo-Australia bilateral relations

▪ Pandemic control lessons: Australia is one of the few countries that has managed to combat COVID-19 so far
through “controlled adaptation” by which the coronavirus has been suppressed to very low levels. Two of the
leaders of this great Australia-wide effort are Indian-born scientists.
▪ Agricultural cooperation: From farming practices through food processing, supply and distribution to
consumers, the Australian agribusiness sector has the research and development (R&D) capacity, experience
and technical knowledge to help India’s food industry improve supply chain productivity and sustainability
and meet the challenges of shifting consumption patterns.
▪ Trade: Australia is the 13th largest economy in the world, following closely behind Russia which stands at $1.6
trillion.
▪ Australia is rich in natural resources that India’s growing economy needs.
▪ It also has huge reservoirs of strength in higher education, scientific and technological research.
▪ The dominance of Indo-Pacific countries in India’s trade profile: Fostering deeper integration between India
and Australia will provide the necessary impetus to the immense growth potential of the trade blocs in this region.
▪ Strategic: The two countries also have increasingly common military platforms as India’s defence purchases
from the U.S. continue to grow.
▪ Australia has deep economic, political and security connections with the ASEAN and a strategic partnership with
one of the leading non-aligned nations, Indonesia. Both nations can leverage their equation with ASEAN to
contain China.
▪ Economic and Maritime dynamics in the Indo-Pacific: The Indo-Pacific region has the potential to facilitate
connectivity and trade between India and Australia.
▪ Quad: Being geographically more proximate than the US, Japan, India and Australia can emerge as leading
forces for the Quad.
▪ Health and safe food as well the supply chains: The promise of DTC-CPG (direct to consumer; consumer
packaged goods) which could transform global supply chains.
▪ International cooperation:
1. WHO’s handling of pandemic: India and 62 other countries have backed a draft resolution led by Australia and
the EU to 'identify the zoonotic source' of Covid-19 and its 'route of introduction' to humans.
2. Australia supports India’s candidature in an expanded UN Security Council.
3. Both India and Australia are members of the Commonwealth, IORA, ASEAN Regional Forum, Asia Pacific
Partnership on Climate and Clean Development and have participated in the East Asia Summits.
4. Australia is an important player in APEC and supports India's membership of the organisation. In
2008, Australia became a n Observer in SAARC.
5. Both countries have also been cooperating as members of the Five Interested Parties (FIP) in the WTO context.

4
Concerns in Bilateral Relations:

▪ Trade implications for India- India and Australia are “too far apart” to conclude the bilateral Comprehensive
Economic Cooperation Agreement (CECA) in the near term.
▪ Perception of Indo pacific- There is no coherent Indo pacific strategy as countries do not have one definitive
vision for the region. It is largely seen as global construct to arrest China’s rise.
▪ Australia’s Foreign Policy Issues: While Australia is dependent on USA for defence and security, its economy is
largely dependent on China. In such a scenario, Australia cannot left China as India cannot address Australia’s all
requirements.
▪ Challenges for India’s economy: Australia’s investment in India is not improving due to compromises, an
interfering bureaucracy, corruption etc.
▪ India opted out from Regional Comprehensive Economic Partnership (RCEP). Among other things, India
and Australia could not agree regarding market access over agriculture and dairy products.

Way Forward

▪ In coming years, the overall relationship between India and Australia will continue to grow and has the
potential to assume greater prominence.
▪ The prospects for bilateral relationship are recognised in both countries as strategically useful, economically
productive and aligned with each other’s new agenda.
▪ The several commonalities and closely aligned values in principles of democracy, liberty, the rule of law,
human rights, freedom of speech, free press and multiculturalism serve as a foundation for a closer co-
operation, multifaceted interaction and enhancement of bilateral relationship.
Virtual Bilateral Summit 2020:
First ever virtual bilateral summit was held between India and Autralia.
Outcome:
Elevated the bilateral Strategic Partnership to Comprehensive Strategic Partnership.
Elevated the “2+2” engagement to the level of Foreign and Defence Ministers (from secretary level), where
strategic discussions will be taking place every two years. India already has such mechanism with USA and Japan.
Mutual Logistics Support Agreement was signed.
Joint declaration on shared vision for Maritime Cooperation in the Indo- Pacific region.

5
 CH-2 INDIA-CANADA BILATERAL RELATIONS

Basics and Background

▪ India-Canada bilateral relations have seen a transformation in recent years underpinned by shared values of
democracy, pluralism, expanding economic engagement, regular high level interactions and long standing people-
to-people ties.
▪ During the visit of Prime Minister of India to Canada in April 2015, the two sides agreed to elevate the bilateral
relations to a strategic partnership.
▪ Historical ties between the two countries go back to over a century when Indians began migrating in small
numbers to British Columbia in late 19th century.
▪ After India became independent the bond of ‘Commonwealth of Nations’ was forged.
▪ Over the years an array of institutional mechanisms has been put in place to promote bilateral cooperation. Both
nations are also active members of multilateral forums such as G-20, ARF, WTO, etc.

People to People Connect

▪ Canada hosts one of the largest Indian diasporas in the world, numbering 1.6 million (PIOs and NRIs) which
account for more than 3% of its total population.
▪ The diaspora has done commendably well in every sector in Canada. In the field of politics, in particular, the
present House of Common (total strength of 338) has 22 Members of Parliament of Indian-origin.

Economic Cooperation
▪ Bilateral trade amounted to USD 6.3 billion in 2018-19 (as per DOC). Canadian Pension Funds have invested
around US$22 billion in India till now.
▪ Canadian Pension Funds cumulatively pledged to invest 2 around US$ 42.5 billion in India and are increasingly
viewing India as an attractive destination for investments.
▪ More than 400 Canadian companies have a presence in India, and more than 1,000 companies are actively
pursuing business in the Indian market.
▪ Indian companies in Canada are active in the field such as Information Technology, software, steel, natural
resources and banking sectors.
▪ India and Canada are discussing Comprehensive Economic Partnership Agreement (CEPA) and Bilateral
Investment Promotion and Partnership Agreement (BIPPA/FIPA).

Energy Cooperation
▪ Energy has been a primary area of our focus in the relations.
▪ The scope of the Energy Dialogue was expanded to additionally include electricity, energy efficiency and
renewable.
▪ India Oil Corporation has a 10% participating interest in a Liquid Natural Gas project in British Columbia.
▪ A Nuclear Cooperation Agreement (NCA) with Canada was signed in June 2010 and came into force in
September 2013.
▪ The Appropriate Arrangement (AA) for the NCA was signed in March 2013, under which a Joint Committee
on Civil Nuclear Cooperation was constituted.
▪ Department of Atomic Energy (DAE) and M/S CAMECO Inc. signed an agreement for supply of uranium ore
concentrate to India in 2015-2020.

Science and Technology

▪ Indo-Canadian Science and Technology cooperation has been primarily focused on promoting Industrial R&D
which has potential for application through development of new IP, processes, prototypes or products.
▪ Both side reviewed the status of ongoing activities and finalized the Action Plan for 2017-18 which envisages 3
collaboration in the emerging technologies such as Artificial Intelligence, Nano-technology, 3D printing, etc.

6
▪ Department of Biotechnology under IC-IMPACTS program implements joint research projects in health care,
agri-biotech and waste management.
▪ Department of Earth Science and Polar Canada have started a programme for exchange of knowledge and
scientific research on Cold Climate (Arctic) Studies.

Space Cooperation

▪ India and Canada are pursuing successful cooperative and commercial relations in the field of Space since 1990s
mainly on space science, earth observation, satellite launch services and ground support for space missions.
▪ ISRO and Canadian Space Agency (CSA) have signed two MOUs in the field of exploration and utilisation of
outer space in October 1996 and March 2003.
▪ ANTRIX, the Commercial arm of ISRO, has launched several nano-satellites from Canada.
▪ ISRO in its 100th Satellite PSLV launched on 12 January 2018, also flew Canadian first LEO satellite, from
Indian spaceport Sriharikota, Andhra Pradesh.
Education

▪ Education is a key area of mutual interest.

▪ Recently India became the top source of foreign students with 203000 Indian students studying in Canada. The
MoU on Higher Education (2010) with Canada was renewed in February 2018.
▪ 69 reputed Canadian faculty members have visited India, so far under the Global Initiative of Academic Works
(GIAN) programme for teaching assignments in Indian institutions.
▪ Canada is one of the 28 countries covered under the Scheme for promotion of Academic and Research
Collaboration (SPARC), an initiative aiming to improve research ecosystems in India’s higher education
institutions.
▪ The Shastri Indo-Canadian Institute (SICI) is a unique bi-national organization fostering, since 1968,
education and cultural cooperation 4 and collaboration between India and Canada.
Defence and Security

▪ India and Canada collaborate closely in international fora, particularly through the UN, Commonwealth and
G-20.
▪ Defence ties have been expanding with mutual ship visits.
▪ There is robust cooperation on counter terrorism issues particularly through the framework of the JWG on
Counter Terrorism.
▪ The security cooperation was further enhanced with the Framework for Cooperation between India and Canada
on Countering Terrorism and Violent Extremism signed by the National Security Advisor of India and the
National Security and Intelligence Advisor of Canada on 14 February 2018.
India-Canada Track 1.5 Dialogue

▪ The India-Canada Track 1.5 Dialogue on Innovation, Growth and Prosperity strives to build closer ties
between India and Canada and nurture the relationship to its full potential.
▪ India-Canada has established a Track 1.5 Dialogue on involving experts, government officials and business
leaders from both sides to explore the possibility of future cooperation.
▪ In addition to its focus on innovation, the partnership will examine topics such as collaboration on research and
higher education, promotion of India-Canada trade and investment, energy cooperation, and issues
pertaining to global governance.
▪ The first round was held in 29-30 October 2018 at Ottawa, Canada.
▪ The second round was held on 22 November 2019 in Mumbai.
Indian Diaspora

▪ Canada is home to over 1.2 million Persons of Indian Origin (PIO) who comprise more than 3% of the country’s
population.

7
▪ The highly educated, affluent and industrious Indo-Canadian community, one the largest immigrant groups in
Canada, is well integrated with the mainstream and serves as a strong bridge between the two nations.
▪ The Indian community is culturally active and has organized itself in various associations and groups.
▪ Greater Toronto Area (GTA) has the largest Indian community estimated at around 600,000 followed by
Vancouver at around 300,000. It is estimated that two-thirds of Indo-Canadians are Punjabi speaking, followed
by those who speak Gujarati.
▪ Many Indo-Canadians hold key positions in business enterprises, public service and other professions.
▪ The Diaspora is also well represented in federal Parliament and provincial legislatures. In the present House of
Commons, there are nine Members of Parliament of Indian origin and two of them are Minister of State in
the Federal Cabinet.
▪ Prominent Indo-Canadian organizations include Canada India Business Council (CIBC), Canada India
Foundation (CIF), Indo-Canada Chamber of Commerce (I-CCC) and other local chambers and associations.
Khalistan Issue

▪ Khalistan extremism in Canada dates back to the post-1984 'Operation Bluestar' period.
▪ In 1985, Canada based Sikh extremist outfit, 'Babbar Khalsa', plotted and executed the mid-air bombing of an
Air India flight, which killed 331 people, the deadliest terrorist attack in the history of aviation until the 9/11
horror.
▪ The Sikh expatriates’ support for the Khalistan’s has since ebbed with only a tiny section still espousing the
cause.
▪ Worryingly for India, however, there has been a marked resurgence of Khalistan radicalism in Canada since
2013 when the Liberal Party came to power.
▪ In recent years, India-Canada ties have deteriorated, especially given the view that the current Justin Trudeau
administration is soft on individuals and organisations that support the demand for Khalistan, a separate Sikh
homeland.
▪ Members of Mr. Trudeau’s Cabinet, especially Defence Minister Harjit Singh Sajjan, have been accused of having
links with Sikh separatists.
▪ When Mr. Sajjan visited India in April 2017, Punjab Chief Minister Captain Amarinder Singh refused to meet him
for this reason.
▪ Similarly, Mr. Trudeau received the cold shoulder during his India visit in February 2018.
▪ When Mr. Singh met Mr. Trudeau, their discussion was on the Khalistan issue, rather than on areas of mutual
cooperation.
▪ Recently, Mr. Trudeau drew the ire of the Indian government when “2018 Public Report on the Terrorism Threat
to Canada” avoided the words ‘Khalistan Extremism’.
Concerns in relations:
▪ Canada remains an insignificant trading partner for India. In 2017, comp ared to other North American
countries, Indian exports to Canada stood at just over US$2 billion, behind the US and Mexico.
However, imports from Canada were valued at more than US$4.5 billion in 2017, ahead of Mexico.
▪ In the popular Indian imagination, Canada is an attractive destination for skilled immigrants and a source
of agricultural commodities and energy resources; it is hardly a strategic partner.
▪ India’s Canada policy, on the other hand, has partly been informed by the presence of Khalistan
sympathizers who espouse anti-India sentiments. Canada’s criticism of New Delhi has dented India’s
interest in engaging Canada as a strategic partner.
▪ India’s economic potential, including the investment opportunities it offers, has led Canada to
periodically review the economic dimension of this bilateral relationship in its India policy.
Way Forward
▪ It is indeed tragic that India-Canada relations have become a political hostage to the Khalistan question
▪ Delhi, however, has rightly decided it must stay engaged with Trudeau, who leads one of the world’s top
economies and is a member of the Group of Seven advanced nations.

8
9
 CH-3 INDIA-FRANCE BILATERAL RELATIONS

Basics and Backgrounds

▪ As early as the 1980s, France wished to give greater scope to its relations with India. France bet on India’s
strategic, diplomatic and economic emergence, and steadfastly supported India’s requests in several strategic
matters: a permanent seat at the United Nations Security Council, better participation in the decisions taken at
international fora (such as the expanded G8 and G20), access to civil nuclear cooperation.
▪ India and France have traditionally close and friendly relations. In 1998, the two countries entered into
Strategic Partnership which is emblematic of their convergence of views on a range of International issues apart
from a close and growing bilateral relationship.
▪ The areas of Defence & Security cooperation, Space cooperation and Civil nuclear cooperation constitute the
principal pillars of our Strategic Partnership with France. India and France are increasingly engaged in new areas
of cooperation like security in the Indian Ocean region, climate change including the International Solar
Alliance, and sustainable growth and development among others.
▪ India and France share a close degree of convergence on a range of regional and global issues. In the economic
domain, while there exists vast potential, French economic capacities, its business and industry, its capital and
technologies have forged linkages with Indian economy and India’s developmental goals.
▪ There exist vibrant bilateral cultural and educational linkages as also growing people-to-people contacts. Indian
diaspora also has a sizable presence in France and in its overseas territories.

Area of Cooperation

Political
Cultura
l
Defence
Cooper
ation

Area of
Digital
Energy Cooper Space
ation

Space Science
Cooperatio
n & Tech
Bilatera
l Trade

10
Political
▪ Political cooperation between India and France is relatively new.
▪ It began with French support for India in limiting international sanctions on Delhi after its 1998 nuclear tests.
▪ Today, France has emerged as India’s most reliable partner on issues relating to terrorism and Kashmir; taking this
forward would be crucial now.

Bilateral Trade
▪ Both India and France have important bilateral investments & trade and commercial cooperation.
▪ France has emerged as a major source of FDI for India with more than 1,000 French establishments already
present in India with a total turnover of US $ 20 billion and employing around 300,000 persons.
▪ France is the 9th largest foreign investor in India with a cumulative investment of USD 6.59 billion from April
2000 to December 2018.
▪ There are more than 150 Indian companies operating in France (including sub-subsidiaries), employing more
than 7,000 persons.
▪ The nations also reaffirmed that the India-France Administrative Economic and Trade Committee (AETC)
provides an appropriate framework to assess and find ways to further promote the bilateral trade and investment
as well as to speed up the resolution of market access issues to the benefit of economic operators.
▪ The two leaders decided to further jointly strengthen work on solving trade and investment issues of concern
for both French and Indian companies, including by additional ways and mechanisms.
▪ The two leaders jointly agreed that the high-level France-India economic and financial dialogue should be
reactivated as quickly as possible.

Defence Cooperation
▪ India and France determined to further strengthen the cooperation between their armed forces and in this
connection are working towards increased interoperability as well as pursuing deliberations to develop joint
forces cooperation.
▪ They welcomed the signing of an agreement regarding the Provision of Reciprocal Logistics Support.
▪ Defence industrial cooperation has been one of the mainstays of the strategic partnership between India and
France.
▪ Both PM Modi and the French President commended the progress made in the implementation of agreements
signed previously, particularly the delivery of the first Rafael fighter jet earlier this year.
▪ The two leaders reaffirmed their commitment to further strengthen cooperation in defence industry field and
extended their support to existing and upcoming partnerships between the defence companies of the two countries
in the spirit of “Make in India” and for the mutual benefit of both countries.

MAJOR ON-GOING DEFENCE-RELATED PROJECTS

Purchase of Rafale aircraft:
▪ The Inter-governmental agreement for purchase of 36 Rafale jets by India in flyaway condition was signed in New
Delhi on 23 September 2016 by Raksha Mantri Manohar Parrikar and French Defence Minister Le Drian.
▪ Project implementation is underway.
22
P-75 Scorpene Project:
▪ The contract for six Scorpene submarines from M/s DCNS was signed in October 2006.
▪ All six vessels are to be built under technology transfer at the Mazagaon Docks Ltd. Project implementation is
underway. The first submarine INS Kalvari was commissioned in October 2017.

Space Cooperation
▪ India and France expressed their desire to deepen their space cooperation to meet new challenges in space
exploration together, whether it concerns planetary exploration or human spaceflight.
▪ Both PM Modi and Emmanuel Macron welcomed the decision to train medical support personnel for Indian
astronauts, who will be part of India’s manned space mission by 2022. The training will be carried out both in
France and in India.
▪ The leaders further welcomed the signing of an Implementing Arrangement for the establishment of a
framework for the realization of joint maritime domain awareness mission. They also welcomed the launch of a

11
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 Space Climate Observatory that further enhances Indo-French cooperation on combating climate change, besides
TRISHNA joint mission and accommodating Argos in Oceansat 3.
▪ The two nations also resolved to act together at the international level to promote norms and best practices
necessary for guaranteeing the safety of space missions.

Digital Space
▪ The two leaders adopted cyber security and digital technology road map aimed at expanding Indo-French bilateral
cooperation, particularly in the strategic sectors of high-performance computing and Artificial Intelligence,
with the target of bringing the start-up ecosystems in both the nations closer to each other.
▪ In recent visit, Cooperation Agreement was signed between the Centre for Development of Advanced
Computing and Atos (a France based IT company) for developing cooperation in fields of quantum computing,
Artificial Intelligence and exascale supercomputing.

Energy
▪ PM Modi and Emmanuel Macron expressed satisfaction at the progress in negotiations between NPCIL and EDF
since the conclusion of the Industrial Way Forward Agreement between the two parties in 2018 for the
construction of six nuclear power reactors in India in Jaitapur, Maharashtra.
▪ The leaders also noted that discussions are underway on the Techno-Commercial Offer and the financing of the
project as well as on how to increase localization through manufacturing in India and enhance common
understanding on the CLND Act between the two sides.

Civil Nuclear Cooperation

▪ An agreement on civil nuclear cooperation was signed between India and France on 30 September 2008 during
the visit of then PM to France. Subsequently, during the visit of then French President Nicolas Sarkozy to India in
December 2010, the General Framework Agreement and the Early Works Agreement between NPCIL and M/s
AREVA for the implementation of EPR for the Jaitapur Nuclear Power Project (JNPP) were signed.
▪ Following M/s AREVA’s restructuring, French utility EDF has now been designated as the lead agency from the
French side for negotiations and implementation of the JNPP.
▪ EDF and NPCIL signed a revised MoU on 22 March 2016 for the construction of six EPR units at Jaitapur of
1650 MWe each. 10.
▪ During the visit of President Macron to India (March 2018), NPCIL and EDF concluded an Industrial Way
Forward Agreement. Discussions between EDF and NPCIL have been ongoing with the objective of expeditious
realization of the project.

Terrorism
▪ The two leaders reiterated their strong condemnation of terrorism in all its forms and manifestations including
cross-border terrorism and terror-related incidents in France and India.
▪ Both leaders reaffirmed that terrorism cannot be justified on any grounds whatsoever and it should not be
associated with any religion, creed, nationality and ethnicity.
▪ The leaders also reaffirmed their strong determination to eliminate terrorism wherever it is to be found and
urged the international community to strengthen the efforts to counter and prevent terrorist financing.

Indian Ocean Region

▪ India and France welcomed the swift implementation of the conclusions of the Joint Strategic Vision of India-
France Cooperation in the Indian Ocean Region, adopted during the State Visit to India of President Macron in
March 2018.
▪ For the implementation of the White Shipping agreement, India and France welcome the appointment of a French
liaison officer at the Information Fusion Centre – Indian Ocean Region (IFC-IOR) in Gurugram.
▪ The two nations further intend to coordinate their action at the Indian Ocean Rim Association (IORA) and
undertake, along with interested states, a joint project for reinforcing assets for combatting piracy and all kinds
of maritime trafficking in the Southern Indian Ocean.
▪ France also intends to work concertedly with India at the Indian Ocean Naval Symposium (IONS), over which it
will preside from 2020 to 2022.
▪ Mutual Logistics Support Agreement, that enables Indian naval warships to now seek access to the French
naval base in Djibouti to refuel for an operational turnaround to return to Indian shores.

12
Cultural Cooperation
▪ Indian culture enjoys wide following amongst the people of France. An Indian Cultural Centre, named
Vivekananda Cultural Centre, is being opened in Paris.
▪ The International Day of Yoga has been organized by the Embassy of India in Paris and other cities of France
since 2016 and have received wide acclaim and press coverage.
▪ Yearlong celebrations have also been organized to commemorate 150th Birth Anniversary of Mahatma
Gandhi, 550th Birth Anniversary of Shri Gurunanak Devji and the 70th Year of the Constitution of India.
▪ A Cultural Exchange Programme, initially for the period 2016 to 2018, continues and is under implementation.
GoI has also offered five scholarships for study of Sanskrit in India to French nationals. Various other bilateral
programmes of cultural cooperation are under implementation.

S&T Technology
▪ In the field of S&T, the Indo-French Centre for the Promotion of Advance Research (CEFIPRA) based in
New Delhi established in 1987 is playing a major role by funding joint proposals for research in sciences and
evaluation existing research projects.
▪ Several other bilateral cooperation programmes exist including an Indo-French Ministerial-level Joint
Committee on Science and Technology, established in 2016, whose first meeting was held in New Delhi in June
2018. 17.
▪ Launch of 8-10 satellites as part of a “constellation” for maritime surveillance in the Indian Ocean region.
▪ French Space Agency CNES concluded an agreement with ISRO for training programmes and bioastronautics for
a human space flight - (Gaganyaan) by 2022.
▪ It is estimated that there are about 10000 Indian students in France.
▪ Encouraged by offer of courses in English medium in the French institutes of higher education, especially in the
field of business management, about 3,000 new Indian students come to France every year.

Indian Diaspora
▪ It is estimated that the Indian community, including NRIs in mainland France number around 109,000, largely
originating from French enclaves of Puducherry, Karaikal, Yanam, Mahe and Chandernagore.
▪ Sizeable number of Indian origin population lives in the French Overseas Territories of the Reunion Island
(280,000), Guadeloupe (60,000), Maritinique (6,000) and Saint Martin (300).
▪ There are more than 50 Indian community organizations active in France. Major communities constituting the
Indian origin population originate from Puducherry and Tamil Nadu, Gujarat and Punjab. 20.

13
▪ The two sides signed a Migration and Mobility Partnership Agreement which aims to facilitate temporary
circular migration based on mobility and the encouragement for a return of skills to the home country.

Global Agendas
▪ Climate change, biodiversity, renewable energy, terrorism, cyber security and digital technology, etc:
▪ There have been joint efforts to limit climate change and develop the Solar Alliance
▪ Both countries have agreed on a road map on cyber security and digital technology.

French presence in the Indo-Pacific

▪ Islands of Réunion and Mayotte (Mozambique channel) in the Indian Ocean and New Caledonia and French
Polynesia in the South Pacific.
▪ France the largest EEZ in the world (11 million sq. km.)—62 % of which is in the Pacific and 24 % in the Indian
Ocean.
▪ Military presence in Djibouti and Abu Dhabi

UNSC reforms: France supports India’s permanent membership

▪ India and France jointly call for reform of the United Nations Security Council that would enable India to gain
a permanent seat on it.
▪ They also reaffirmed their commitment to working expeditiously and constructively, together and with others
towards the modernisation of the World Trade Organization, including in the lead-up to the 12th Ministerial
Conference in June 2020.
▪ Further, the two nations reaffirmed their determination to deepen the relations between the EU and India on
strategic and multilateral issues as well as in trade, investment and innovation.

Mutual benefits
▪ Indo-French naval cooperation is aimed at securing the critical sea lanes, the need to effectively combat security
threats piracy, trans-national crime and terrorism and also to build security capacities in the Indian Ocean.
▪ The more substantive pay-off of a nautical pact with France for India is a potential expansion of the Indian
Navy’s operational footprint across the Indo-Pacific region.
▪ Future discussions might result in the signing of a reciprocal agreement granting French naval vessels
access to Indian ports for repair and resupply, and Indian vessels the right to routinely use France’s Indian
Ocean military bases like Djibouti where china has a base.
▪ French facilities are likely to add to India’s network of nautical outposts in the IOR, including in the
Andaman and Nicobar Islands, and Seychelles, where India plans to build and operate a military base.
▪ French companies, such as Dassault Aviation etc. are extremely competitive and the country’s defence industry
has a reliable record of production and supply with firms having particular expertise in navigating India’s
defence market for instance the contracts for the Rafael aircraft and Scorpene Class Submarines (Project-75).
▪ A nautical pact with France sends a strong message to India’s geopolitical antagonists in maritime Asia. India will
be hoping for a closer engagement in the Western Indian Ocean, where France has one of the most
forward-deployed armed forces in the world.
▪ India’s naval leadership would be keen to expand the scope and complexity of the Indo-French bilateral naval
exercise VARUNA
▪ A partnership with the French navy in littoral South-East Asia would allow the Indian Navy to influence the
security-dynamic of the Pacific, even extending operations to the Southern Pacific Islands.

Concerns
▪ While the governments share a robust relationship, the business relationships are weak. Bilateral trade is less
than half of India’s trade with Germany. The target of €12 billion set in 2008 remains elusive.
▪ French FDI has picked up in recent years, but hardly does justice to the fact that there are more than 800 French
enterprises in India.

Way Forward
▪ France also opens the pathway for deeper engagement with Europe on global issues.
▪ Since independence, India has experimented with different institutions including the NAM and BRICS to shape
global norms.

14
▪ The new partnerships with France, Germany and other like-minded countries like Japan would hopefully be
significant for India’s influence on the global stage.
▪ French social security laws, long-term student visas, and the facility to work for two-three years to pay off student
loans are some of the areas that need to be worked out so that more effective cooperation can take place between
the two countries.
▪ France, which had sought strategic autonomy within the framework of its alliance with the US, and India, which
has valued independent foreign policy, are natural partners in building the new coalitions for an uncertain era.
▪ France also opens the pathway for deeper engagement with Europe on global issues, especially after
uncertainty in the region due to BREXIT.
▪ Even though above specified areas provided a robust basis for engagement, it remained primarily at a
government-to-government level. In recent years, it was clear that for a wider partnership, strengthening
business-to-business and people-to-people relationships was essential.

15
 CH-4 INDIA-GERMANY BILATERAL RELATIONS

Basic and Backgrounds

▪ Bilateral relations between India and Germany are founded on common democratic principles and are marked
by a high degree of trust and mutual respect.
▪ India was amongst the first countries to establish diplomatic ties with the Federal Republic of Germany after
the Second World War.
▪ Relations grew significantly following the end of the Cold War and the reunification of Germany. In the last
decade, both economic and political interaction between India and Germany has increased significantly. Today,
Germany is amongst India’s most important partners both bilaterally and in the global context.
▪ India and Germany have a “Strategic Partnership” since 2001, which has been further strengthened with the
Inter-Governmental Consultations (IGC) at the level of Head of Governments (German Chancellor and PM)
which allows for a comprehensive review of Cooperation and identification of new areas of engagement.
▪ India is amongst a select group of countries with which Germany has such a high-level Consultations. The 4th
IGC was held in Berlin on May 30, 2017 wherein 12 Cooperation documents in various sectors were signed.
▪ The 5th IGC, was held in Delhi on Nov. 1, 2019 during which 21 MoUs/Agreements were signed in diverse areas
of engagment including some of the new and emerging areas such as Artificial Intelligence, Space, Smart
Cities, Urban Green Mobility etc.
Political

▪ Regular visits take place from both sides, including at the highest level.
▪ Both the nations are a member of few multilateral groups like G-20, G-4, etc.
▪ The two leaders exchanged pleasantries at the G7 Summit in August 2019 and the UNGA in September 2019.
Promoting Security, Stability, and Sustainability contributing to a Rules Based Global Order

▪ G20 - Challenges to global economic stability and growth.

▪ Support for NSG
▪ G-4 - Reform of the UNSC, discussions towards initiation of text-based negotiations.
▪ Freedom of navigation in international waters, the right of passage and other maritime rights and obligations in
accordance with the UNCLOS and other principles of international law.
▪ Defence cooperation - To conclude negotiations on a binding agreement concerning enhanced cooperation in the
defence field including in defence industry cooperation.

16
▪ Joint Working Group on Counter Terrorism.
▪ Joint Declaration of Intent on German-Indian Cooperation on Cyber Policy.
▪ Exploring the possibilities to cooperate in their assistance to African Countries.
▪ Climate Change - Implementation of the Paris Agreement with a timely transformation to low carbon inclusive
sustainable economies.
▪ Trade & Economy - Negotiation on EU-India BTIA

Parliamentary Exchanges

▪ There is an Indo-German Parliamentary Friendship Group, in German Bundestag since 1971.

▪ The Indo-German Parliamentary Friendship Group (constituted in May 2018) for the present term of German
Parliament consists of 24 Members from all the six parties represented in the German Parliament.
▪ Visit by Parliamentarians from both sides take place regularly.
Sister States

▪ Some States and Cities of India and Germany have entered into twinning arrangements.
▪ Karnataka and Bavaria have Sister State arrangement since 2007. Mumbai and Stuttgart are sister cities since
1968.
▪ In January 2015, Maharashtra and Baden-Wurttemberg signed an MoU to establish a Sister State relationship.
Institutional Cooperation Arrangements

▪ Several institutionalized arrangements exist between India and Germany to discuss bilateral and global issues of
interest namely, Foreign Office Consultations, High Defence Committee, Indo-German Energy Forum, Indo-
German Environment Forum, S&T Committee, and Joint Working Groups in various fields, including skill
development, automotive, agriculture, coal, tourism, water and waste management.
▪ Both countries consult each other and coordinate positions in multilateral fora including G-20 and in the UN on
global issues such as climate change, sustainable development, etc.
▪ There have been consultations between the two countries on regional and international issues such as UN issues,
International Cyber Issues, Disarmament & Non-proliferation, Export Control, East Asia, Eurasia, Africa
etc.
Defence Cooperation

▪ India-Germany Defence Cooperation Agreement (2006) provides a framework for bilateral defence
cooperation.
▪ The then, German Defence Minister Ms. Ursula von der Leyen visited India in May 2015 and Raksha Mantri
visited Berlin in February 2019.
▪ To further enhance the Defence Industry and defence cooperation between Germany and India, an Arrangement
on Implementation of the Agreement of 6th October 2006 concerning Bilateral Defence Cooperation was
signed on February 12, 2019 during the visit of Raksha Mantri to Berlin.
Economic & Commercial Relations

▪ Germany is India's largest trading partner in Europe. Bilateral trade grew from Euro 15.96 billion to Euro
20.41 bn in 2018. In the period January to November 2019, total bilateral trade stood at Euro 19.35 bn.
▪ Germany is the 7th largest foreign direct investor in India since April 2000. Germany's total FDI in India from
April 2000 until June 2019 amounted to US$ 11.9 billion. 12.
▪ Facilitating Trade: A Fast-Track System for German companies has been operating in Department for Promotion
of Industry and Internal Trade (DPIIT) since March 2016.
▪ India and Germany signed a Joint Statement on April 1, 2019 to set up a Fast-Track system for Indian
Companies in Germany.
▪ To facilitate the entry of German Mittelstand (Medium Sized Companies) in India, the Embassy of India, Berlin
runs the Make in India Mittelstand (MIIM) Programme since September 2015. Currently, 135 German

17
 Mittelstand (MSMEs) companies are being facilitated through MIIM Programme for market entry and investment
in India.
Science & Tech

▪ Indo-German Science & Technology cooperation started with the signing of the Intergovernmental S&T
Cooperation Agreement in 1971 and 1974.
▪ There are more than 150 joint S&T research projects and 70 direct partnerships between Universities of both
countries.
▪ India's scientific establishments have close partnerships with German R&D institutions, including the Max Planck
Society, Fraunhofer Laboratories and the Alexander von Humboldt Foundation.
▪ India Germany have High Technology Partnership Group (HTPG) for identifying specific opportunities for
high technology collaboration under the “Make in India” programme.
▪ Both decided on cooperation in the Field of Artificial Intelligence and Digital Transformation.
Culture

▪ India and Germany have a long tradition of academic and cultural exchange. Max Mueller was the first scholar
of Indo-European languages to translate and publish the Upanishads and the Rigveda.
▪ German interest in the Indian philosophy and languages resulted in the setting up of the first Chair of Indology at
the University of Bonn in 1818.
▪ The Government of India has funded 31 short term rotating chairs of Indian studies in German Universities so far.
▪ There has been growing interest in Germany in Indian dance, music and literature, as well as motion picture
and TV industry.
▪ Indian films and artists regularly feature at the Berlin International Film Festival and at Indian Film festivals
held in other parts of Germany.
▪ Promotion of teaching modern Indian languages in German educational institutions as agreed in 2015.

Development Cooperation

▪ Germany has been an important development cooperation partner for several decades. Total bilateral Technical
and Financial Cooperation since it began in 1958, amounts to approx. Euro 17 billion.
▪ Energy, sustainable economic development and environment & management of natural resources are
priority areas.
▪ Financial assistance from Germany is mainly as soft loan, composite loans or grants routed through KfW,
German Government’s Development Bank.
▪ Technical assistance is provided through GIZ, German Government’s development agency. Major projects are in
the sectors of energy (Renewables, Green Energy Corridor), Indo-German Solar Partnership, Skill Development
and Sustainable urban development (water/sanitation/waste, climate friendly urban mobility, smart cities).
▪ India-Germany cooperation on cleaning the river Ganga: The National Mission for Clean Ganga (NMCG) and
GIZ Germany signed an Implementation Agreement for Ganga Rejuvenation in 2016 under which Germany
committed €3 million for data management and capacity building to deal with the pollution.
Indian Diaspora

▪ There are about 1.7 lakh Indians and people of Indian origin in Germany.
▪ The Indian diaspora mainly comprises of professionals, technocrats, businessmen/traders and nurses.
▪ There has been an increase in the last few years in the number of qualified Indian professionals in Germany in the
fields of IT, banking, finance, etc.
▪ There are a number of Indian associations in Germany. Around 17,500 Indian students are pursuing various
courses in Germany.
Germany Boosting ties with India

18
▪ Reflecting the new interest, the German Parliament passed a resolution on boosting ties with India days before
Merkel arrived in Delhi.
▪ India a pillar of Asian stability and a country that shares European political values.
▪ As Germany seeks to bring India into its larger geopolitical calculus, India too is ending its prolonged
indifference to Europe as a strategic actor.
▪ The recent elevation of India’s engagement with France is now being followed by a fresh look at strengthening
ties with Germany.
▪ Engaging Germany is not just about bilateral relations with Berlin. It is about collaboration with the Germany-
led European Union as a whole.
▪ The expansive range of agreements signed during Merkel’s visit include trade and investment, mitigating
climate change, the digital revolution, urban development, agriculture and human resource development.
▪ Unlike in the past, defence and security have acquired a prominent place in Indo-German discussions.
▪ India had recently celebrated remarkable improvements in the ease of doing business, indicating its willingness to
remove bureaucratic hurdles.
▪ However, technical regulations in trade like testing requirement are real burden for German Companies.

Strategic Partnership for Sustainable Growth and a Reliable International Order

▪ Chancellor Merkel and Prime Minister Modi reiterated that the Indo-German Strategic Partnership is based on
the common values and principles of democracy, free and fair trade, and rules-based international order, as well as
on mutual trust and respect.
▪ Key issues in the discussions included jointly driving the digital transformation through innovation and frontier
technologies, especially artificial intelligence, making economic growth sustainable by cooperating on climate
change, creating space for people to people contacts through legal mobility for skilled labour, and contributing
to a reliable international order by strengthening and updating multilateral institutions.
▪ Recognising that AI will fundamentally impact the way the world lives and works in the coming years both sides
intend to work together to foster, encourage and develop cooperation on AI technologies and thereby promote
innovation and sustainable development.
▪ Both sides reaffirmed the importance of building Digital Partnership to intensify regular interaction and
coordination towards collaboration on the next generation technologies.
▪ India and Germany aspire to build a collaborative partnership by leveraging advantages on each side
recognising increasing integration of hardware and software in developing IoT and AI solutions for societal
benefits.

International Cooperation for Multi-lateral Research

▪ Recognizing that international cooperation has long been a key feature of cutting-edge research projects, Germany
and India agreed on working together closely to conduct joint bilateral and/or multilateral research and
development activities on the development and use of AI.
▪ This also includes cooperation between German and Indian companies which are part of the same global value
chains.
▪ Both sides stressed the unique opportunity to enhance Indo-German collaboration in the area of AI for health.
▪ AI collaborations in Agriculture such as precision farming with the aim to increase efficiency and to save
resources as well as reduction of food losses and waste.
▪ Germany and India agree to share research on the complexities arising out of adoption of AI in the workplace and
its impact on the economy and society through a joint workshop.
▪ They welcomed the first stakeholder meeting in Berlin in September 2019 and agreed on facilitating another such
meeting in India.

Expanding frontiers of Trade and Investment

▪ The leaders underlined their determination to enhance bilateral trade and investment.
▪ Both sides confirmed the importance of a balanced Free Trade Agreement between India and the EU and agreed
to deepen efforts to restart negotiations between the EU and India on the Bilateral Trade and Investment
Agreement.

19
▪ Both sides reiterated their strong support for a rules-based international trading system with the WTO at its
centre.
▪ Against this backdrop all efforts should be made to restore the full functioning of the WTO dispute settlement
system and reform the WTO without undermining its fundamental principles such as Special and Differential
Treatment, consensus-based decision making and development objectives.
▪ To this end both Parties will strive to make the next WTO Ministerial Conference in Nursultan, Kazakhstan a
success.
▪ Amidst the current unpredictability of the US security policies, President Donald Trump’s attack on the world
trading system, the rapid economic expansion of China into Europe, the increasing assertiveness of the Sino-
Russian political axis, Berlin is looking to diversify its global partnerships beyond the Euro-Atlantic space.
▪ India is inevitably at the top of its list of potential strategic partners.

5th Biennial Inter Governmental Consultations

▪ Joint Declaration of Intent on the Indo-German Partnership on Green Urban Mobility under which
Germany will provide additional finance of 1 billion euros.
▪ Dedicate a part of the 35 million euros under the framework of the bilateral call of the International Climate
Initiative to grid expansion and storage systems for renewable energy and a part to forest landscape restoration.
▪ "Indo-German Partnerships on Higher Education” (IGP) was signed as part of the overall programme "A
New Passage to India” to increase the number of Indian students studying in Germany.
▪ Both countries called for cooperation of all countries in uprooting terror infrastructure, disrupting terrorist
networks.
▪ Germany will facilitate export of military equipment as well as technology sharing with India including
maritime projects between the Indian and German naval industries (e.g. submarines).

Way Forward

▪ Europe continues to be an important source of capital and technology which India needs for its own
development.
▪ Focusing attention on relations with Germany which is the most powerful and now increasingly assertive player in
European affairs has been a good move on the part of the Modi government.
▪ The current uncertainty in the relations between America, China and Russia demands that India move closer to
the European middle powers — France and Germany.
▪ Delhi must also devote more attention to other parts of the continent, from Spain to Sweden and Portugal to
Poland, that have so much to offer India.

20
 CH-5 INDIA-ITALY BILATERAL RELATIONS

Basic and Backgrounds

▪ India and Italy are ancient civilizations but young states (Italy having been reunified only in 1861).
▪ The classical languages, Sanskrit and Latin both belong to the Indo-European language family.
▪ Peoples of these two ancient civilizations have known, interacted and traded with each other for over 2000
years. Italian port cities were important trading posts on the spice route.
▪ The Venetian merchant Marco Polo, during his travels to the east, also travelled to India in the 13th century and
wrote about his experiences.
▪ Indian troops, serving with the British Indian Army, were active in Italy during the World War II. These
included the Rajputana Rifles and Gurkha Rifles.
▪ The 10th Indian Division took part in the East African Allied campaign against the Italians in Somaliland and
Abyssinia.
Political

▪ Political relations between India and Italy were established in 1947.

▪ The two countries enjoy cordial relationship.
▪ There has been a regular exchange of visits at political and official levels between both countries.
Economic Relations

▪ Amongst EU members-states, Italy is India’s 5th largest trading partner (following Germany, Belgium, UK
and France).
▪ Indian exports to Italy are driven by petrochemical, plastic, textile and steel. Italian exports towards India amount
to 1% of Indian total import.
▪ Italy is the 27th global supplier to India, while is the 10th market of destination of Indian exports.
▪ Italy’s presence in India accounts for slightly less than $3 billion investment cumulatively between April 2000
and June 2018. Those investments are mostly in the automotive industry, trading, services, industrial machinery
and food processing.
▪ Main items of Indian exports to Italy are ready-made garments, leather, iron ore, motor vehicles, textiles,
chemicals, gems & jewellery. Main items of import from Italy are general and special purpose machinery,
machine tools, metallurgical products, and engineering items. Around 140 large Italian companies are active in
India.

21
Trade relations

▪ The Indian-EU free trade agreement has seen bumpy rides in this FTA.
▪ There have been many rounds of negotiations but nothing significant has come out. With Italian support now,
this FTA is expected to be little easier to have breakthrough as it is good to have support from one of the major
EU countries.
▪ The trade between India and Italy is not quite encouraging. The annual turnover is about 8.8 billion US
dollars in favour of India of about 1 billion US dollars. Though it is in India’s favour but there is a great
potential for increasing the trade between India and Italy.

Indian diaspora in Italy

▪ Italy hosts the third largest Indian community in the European Union, with an estimated 1,80,000 people, after
the UK and the Netherlands.
▪ As first generation migrants, majority of them are engaged in economic sectors such as agriculture, dairy
farming, leather industry, construction works and in service industry.
▪ A significant proportion of the Indian diaspora is concentrated in the northern Italy regions like Lombardia,
Piemonte, Veneto and Emilia Romagna regions, Central Italy like Florence, Rome and Southern Italy like
Campania, Puglia and Calabria.
Cultural Ties

▪ The agreement for cultural cooperation was signed in 1976.

▪ It includes the Cultural Exchange Programme (CEP) between Italy and India which entails exchange of
students in language programmes as well as other academic courses.
▪ There are around 10 Universities/higher education institutions in Italy with highly qualified faculties which
conduct courses in Indian art, history and languages.
Science & Tech

▪ An Agreement on S&T Co-operation exists since 1978.

▪ The Agreement envisages three yearly action plans under which a maximum of thirty joint research projects
can be undertaken.
▪ Some of the prime areas of joint research are Electronics, Biotechnology, Design Engineering Automotive
Technologies, Energy, etc.
Defence:

22
▪ Joint Defence Committee was established in 2018 to enhance and encourage a “structured dialogue” between
Indian and Italian defence firms.
▪ Italy supported India’s “intensified engagement” with nuclear, missile and dual-use technology and
substances-export control regimes like the Wassenaar Arrangement, the Australia Group, and the Nuclear
Suppliers’ Group (NSG) which strengthen global non-proliferation efforts.

Support in anti-terrorism

▪ Italy has supported India in the anti-terrorism front. India has for a very long time globally asked the world to be
more proactive and be strict against terrorist organisations especially organisation like the JeM which are
based in Pakistan and are responsible for cross terrorism.
▪ Support by Italy in this matter strengthens India’s hands in its global fight against terrorism especially when it
comes to Pakistan. Today, terrorism has become a global issue and is not restricted to India
only. Acknowledgment of terrorist organisation such as Al Qaida and ISIS calls upon countries to not give safe
haven to the terrorist entities.
▪ India is facing terrorist attacks whereas Italy faces influx of refugees from Syria, Yemen, Libya along with other
countries in Europe. Thus, there is a rising security concern for Italy also and it is significant when such area is
openly discussed.
▪ Italy feels that this concern of cross border terrorism was raised by India for a long time and now it is being
realised as a reality.
▪ Horrific terrorist incidences happening in Europe makes one feel that may be Europe is now a little more sensitive
to a country like India in matters of anti-terrorism.
Significance of India and Italy’s partnership

▪ Strong manufacturing base - Italy is the eighth largest economy in the world and the third largest in the
Eurozone after Germany and France with a GDP of $1.86 trillion. It is also the world’s sixth largest
manufacturing nation, dominated by small and medium enterprises clustered in many industrial districts.
▪ Brexit - Half of the stock of Indian investments in the EU is actually in the UK. Indian investors are therefore
looking for alternative entry points to access the EU market. Italy represents a perfect opportunity for that.
▪ The geopolitical dynamics between India and Europe - India has tried to open its policy towards Europe,
Europe has become more inward looking following Brexit and the rise of the far right parties throughout the
region. So India is looking to build a bridge to the EU.
▪ G20 - Italy and India will be holding the consecutive Presidencies (Italy in 2021 and India in 2022) of the G20,
one of the world’s main fora for global governance.
▪ Fight against climate change - Italy will co-host the 26th session of the Conference of the Parties, COP26, in
2021, together with the United Kingdom, and India is one of the world’s major responsible stakeholders.
▪ Africa - Both India and Italy are stepping up their engagement in the continent, with the aim of managing
migration flow for Italy and fostering developing cooperation for India.

Challenges

▪ Lower trade - India and Italy have been trade partners since the Roman era, and so it is unfortunate that India has
such a low volume of trade and investment.
▪ The Enrica Lexie Case - Where two Indian fishermen were killed by Italian marines in 2012, the event was a big
mistake, this tragic fact quickly became politicised.
▪ Italy’s current political instability - Italy is in a very precarious position – with a nationalist, naturalist near
fascist on one side and a populist movement on the other.
▪ Italy is the ‘Achilles heel of Europe’ having one of the lowest growth rates at 1.5% with high youth
unemployment at 30% and increasing debt at a worrying 133% of its GDP.

Way Forward

▪ Both countries should shape the international discourse around priorities that both countries hold dear:

23
1. from taking advantage of our economic complementarity to strengthening our partnership based on shared values
2. on our thriving creating industries
3. scientific knowledge and technological prowess
4. from the development of a rules-based international system to the promotion of just trade
5. inclusive growth and the realisation of the 2030 Agenda.
▪ Supporting an effective multilateral system, which would be the best political accelerator to win our battle
against the novel coronavirus and to promote a sustainable, equitable and durable recovery.
▪ Improving trade: the potential of India and Italy as trade partners can be further explored if India and European
Union (EU) sign the Bilateral Trade and Investment Agreement (BTIA) which has been in negotiation for over 11
years without conclusion.
▪ Improving relations between EU and India by the recently adopted EU Strategy for Connectivity in Asia.

24
 CH-6 INDIA-ISRAEL BILATERAL RELATIONS

Basics and Background

▪ Although India had recognised the Jewish State of Israel way back in 1950, it established full diplomatic
relations only in 1992.
▪ Since then there has been an upswing in the relations between the two countries in view of the common concerns
about religious extremism and global terrorism.
▪ Israel and India have developed close “cooperation” in intelligence sharing and “counter-insurgency”
operations.
▪ India has become a major buyer of Israeli armaments.
▪ There is a considerable potential for Indo-Israeli cooperation in the field of science and technology, particularly
in areas such as dry land farming.
▪ Israelis, particularly the youth, were attracted by the India culture and history, leading to the initiation of
liaison. The Israelis visited India, resulting in the budding of the people-to-people ties. This formed a significant
base for the establishment of the formal diplomatic relationship in 1992.
▪ Since 1992, many of these impediments ceased to exist. Egypt made peace with Israel in 1979, breaking a huge
anti-Israeli mind-set among the Indians.
▪ Another significant breakthrough in this regard is the Madrid Conference that was held in 1991. This conference
aimed to revive the Israeli-Palestine peace process through negotiations involving the Arab nations and Israel.
▪ Other similar developments include the 1993 Israeli-Palestinian Oslo Accord and the 1994 Israel-Jordan Peace
Agreement. These peace negotiations helped India form close ties with Israel.
▪ Other events that led to the improvement of bilateral ties include the collapse of the Soviet Union in 1991 and
liberalisation of the Indian economy.
▪ Once these barriers were removed, the bilateral ties have exponentially improved at a rapid pace, becoming a
strategic asset for both the nations.

25
Factors which held back India –Israel ties for the first forty years after independence

▪ Legacy of freedom struggle and Mahatma Gandhi who opposed the creation of a Jewish state.
▪ A fear of alienating its large Muslim population
▪ Cold War politics
▪ A desire to counter Pakistan’s influence in the Muslim world
▪ A need to garner Arab support for its position over the Kashmir issue compelled New Delhi to pursue an
exclusively pro-Arab and thus pro-Palestinian foreign policy for more than forty years.
Shift in India’s Israel Policy

▪ This re-evaluation has been based on a realization that India’s largely pro-Arab stance in the Middle East has
not been adequately reciprocated and rewarded by the Arab world.
▪ India has received no worthwhile backing from Arab countries in the resolution of problems it faces in its
neighborhood, especially Kashmir.
▪ There have been no serious attempts by the Arab world to put pressure on Pakistan to reign in the cross border
insurgency in Kashmir.
▪ On the contrary, Arab nations have firmly stood by Pakistan, using the Organization of Islamic Cooperation
(OIC) to build support for Islamabad and jihadi groups in Kashmir.
▪ If Arab nations, such as Jordan, have been able to keep their traditional ties with Palestine intact while building a
new relationship with Israel, there is no reason for India not to take a similar route, which might give it more
room for diplomatic maneuvering in the region.
▪ Additionally, the 1991 Madrid Peace Process prompted India to conclude that if the Arab world and the
Palestinian Liberation Organization (PLO) were now willing to negotiate with Israel, New Delhi had no reason to
maintain the status quo.
▪ They face common challenges such as the terrorism that both India and Israel face comes not only from
disaffected groups within their territories; it is also aided and abetted by neighbouring states, increasingly capable
of transferring weapons of mass destruction to terrorist organizations.
DE-HYPHENATION OF RELATION
▪ De-hyphenation means delink two entities and consider them as individuals.
▪ Now India’s relationship with Israel would stand on its own merits, independent and separate from India’s
relationship with the Palestinians.
▪ This has bolstered the scope for addressing India’s national interests effectively and diversified access to new
markets and technologies.
▪ The hyphenation was a compulsion during the Cold War era, but it continued to underpin India’s approach even in
the subsequent period, probably out of the fear of antagonising the Arab.
▪ However, due to disturbances among the Arab states they were left incapable of pursuing a strong foreign policy
that made it easier for India to pursue its relations with Israel.
TWO- STATE SOLUTION OF ISRAEL PALESTINE ISSUE
▪ It envisages an independent State of Palestine alongside the State of Israel west of Jordan river.
▪ 1937: Proposed on basis of Peel Commission report but rejected by Arabs.
▪ 1948: UN partition plan given with Jerusalem under international control
▪ Oslo Accord, 1991: Provided the foundation for political boundaries as it stands today.
▪ The Madrid Conference of 1991 was a peace conference co-sponsored by the US and the Soviet Union to revive
the Israeli–Palestinian peace process through negotiations.
▪ UNSC Resolution 1397: Agreed in 2000 with support from USA and becoming first UNSC resolution to agree on
two state solution.

Political Cooperation

▪ Since the up-gradation of relations in 1992, defence and agriculture have become the two main pillars of the
bilateral engagement.

26
▪ The political ties have become especially cordial under the Modi Government.
▪ In 2017, Prime Minister Modi became the first-ever Indian Prime Minister to visit Israel.
▪ During this visit, the diplomatic relationship was upgraded to a strategic level and seven agreements/MoUs were
signed in the areas of R&D, innovation, water, agriculture and space.
▪ In 2018, the Israeli Prime Minister visited India, during which Government to Government (G2G) agreement on
cyber security, oil and gas cooperation, film cooperation and air transport were signed, along with five other semi-
government agreements.
▪ An increase in the high-level exchanges in recent times has expanded cooperation in areas like trade, agriculture,
science and technology and security.
Economic Cooperation

▪ The bilateral merchandise trade stood at $5.02 billion (excluding defence) in 2016-17.
▪ While exports from India were $3.06 billion, the import to India from Israel was $1.96 billion.
▪ The diamond trade constitutes more than 53% of the bilateral trade.
▪ India is Israel’s third-largest trading partner in Asia after China and Hong Kong.
▪ In recent years, bilateral trade has diversified to include several sectors like pharmaceuticals, agriculture, IT
and telecom and homeland security.
▪ Major exports from India to Israel include precious stones and metals, chemical products, textiles and textile
articles, etc.
Investment
▪ The major investments from Israel in India include renewable energy, telecom, real estate, water technologies
etc., and are also setting up R&D centres or production units in India.
▪ The extent of Israel’s investment in India is not available as most of these are routed via third countries such as
Singapore, USA.
▪ Also, India’s investments in Israel are mostly in drip-irrigation, pharmaceuticals, wastewater treatment, IT
etc.
▪ Israel’s flexible export policy meets Indian demands for technological transfer that have recently been an
important part of governments overall developmental agenda.

Agriculture
▪ Under a comprehensive Work Plan for cooperation in agriculture signed on 10 May 2006, bilateral projects are
implemented through MASHAV (Center for International Cooperation of Israel’s Ministry of Foreign Affairs)
and CINADCO (Centre for International Agricultural Development Cooperation of Israel’s Ministry of
Agriculture and Rural Development).
▪ Agricultural cooperation between the two sides is formalized through 3-year Work plans wherein 3-year Action
plans are developed.
▪ The two sides signed the fourth phase of the joint action plan (2018-20) in July 2017.
▪ Out of 29 Centres of Excellence expected to be fully active by 2020 in twelve Indian states (Bihar, Gujarat,
Haryana, Karnataka, Maharashtra, Punjab, Rajasthan, Tamil Nadu, Uttar Pradesh, Mizoram, Andhra
Pradesh and West Bengal), 25 have been commissioned.
▪ India has benefited from Israeli expertise and technologies in horticulture mechanization, protected cultivation,
orchard and canopy management, nursery management, micro- irrigation and post-harvest management
particularly in Haryana and Maharashtra.
▪ Israeli drip irrigation technologies and products are now widely used in India.
▪ Some Israeli companies and experts are providing expertise to manage and improve dairy farming in India
through their expertise in high milk yield.
Defence and Security

▪ India imports critical defence technologies from Israel.

▪ There are regular exchanges between the armed forces.
▪ As part of the regular goodwill visits of Indian ships, three Indian naval ships from the Western Fleet made a port
call in Haifa in May 2017.
▪ INS Tarangini, a naval training ship, made a port call in Haifa in September 2018.

27
▪ There is cooperation on security issues, including a Joint Working Group on Counter-Terrorism.
▪ In February 2014, India and Israel signed three important agreements on Mutual Legal Assistance in Criminal
Matters, Cooperation in Homeland Security, and Protection of Classified Material.
Science & Technology
▪ Under a Science and Technology Cooperation Agreement in 1993, Science and Technology institutions undertook
joint research.
▪ Specific areas of cooperation include IT, biotechnology, lasers and electro-optics.
▪ In 2005, India and Israel signed an MoU to set up i4RD fund to encourage bilateral investment into industrial
research and development and specific projects.
▪ Under the agreement, at least one Indian and one Israeli company must be collaborating on a project for it to be
qualified for the fund.
▪ In 2012, both nations signed a five-year $50 million academic research agreement for promoting collaborative
research in various disciplines, including medical technology, IT, social and welfare sciences, humanities and arts.
▪ Israel has also offered to assist with India’s Clean Ganga Mission by providing its expertise in water
management to address water scarcity.
Culture
▪ Israelis know India for its culture and tradition, making it an attractive alternative tourist destination.
▪ In 2017, Indian tourists became the second largest from an Asian country.
▪ In 2011, cultural artists and performers from India participated in a three-week festival commemorating 20 years
of diplomatic relations between the two countries.
▪ In 2019, a large-scale summit was organized to boost cultural ties.
▪ On February 15, 2020, the first of its kind Jerusalem-Mumbai festival was held in Mumbai to promote artistic and
cultural ties between the two nations.
▪ This festival aimed to establish a link between the cities of Jerusalem and Mumbai and boost cooperation in the
field of music, culinary art and dance.
Education

▪ In recent years, several public and private Indian universities have entered into academic agreements with
Israel’s educational institutions.
▪ Since 2012, Israel has been offering post-doctoral scholarships to students from India and China in all fields for
three years.
▪ India too offers scholarships to Israelis every year and an equal number of scholarships are offered by Israel for
10-month programmes in specialized fields of study.
▪ In 2014, the Indian diamond community in Israel had set up a fund to finance study tours to India for meritorious
Israeli students of Hindi.
Indian Diaspora
▪ There are approximately 85,000 Jews of Indian-origin in Israel (with at least one Indian parent), who are all Israeli
passport holders.
▪ The main waves of immigration into Israel from India took place in the fifties and sixties. The majority is from
Maharashtra (Bene Israelis) and relatively smaller numbers from Kerala (Cochini Jews) and Kolkata
(Baghdadi Jews).
▪ In recent years some Indian Jews from North Eastern states of India (Bnei Menashe) have been immigrating to
Israel.
▪ While the older generation still maintains an Indian lifestyle and their cultural links with India, the younger
generation is increasingly assimilated into Israeli society.
India’s stand on Israel Palestine issue
▪ India, for a very long time, had called for the 2-state solution that supports the establishment of a sovereign
independent state of Palestine.
▪ However, India’s stand on Israel-Palestine conflict has not hindered the growing diplomatic relationship with
India and Israel.

28
▪ Yet, the recent close ties with Israel have diluted India’s stance on the issue.
▪ In 2014, India favoured a UN resolution that established a Commission of Inquiry to investigate a violation of an
international humanitarian and human rights law in the “Occupied Territories” during Operation Protective Edge
conducted by Israel in the Gaza strip.
▪ However, the Indian Government did not pass a resolution in the parliament condemning the Israeli action,
contrary to the earlier practices.
▪ At the UN Human Rights Commission (UNHRC), India abstained on the resolution that welcomed the report of
the same Commission of Inquiry, making it the first time India had refused to vote against Israel at the UN.
▪ However, the Indian government clarified that this does not mean that there is a change in India’s traditional
support for the separate state of Palestine.
▪ Nevertheless, from the growing strategic ties, it is evident that India is distancing itself from advocating for
the Palestinian cause.
Differences

▪ Difference in terms of Iran- Where on one hand Israel considers Iran an existential threat, India, on the other, has
a historical relationship, and finds the cooperation useful for energy supplies, and an alternative route through
Chabahar port to Afghanistan and Central Asia.
▪ Different approach towards Arab world- While Israel has inherent differences with Arab countries, India has
significant stakes there and India’s recent vote at the UN against America’s move on Jerusalem was a reflection of
that underlying reality.
▪ Stand on China- China is Israel’s largest trading partner in Asia, there are strong technology and investment
linkages.
▪ In terms of Pakistan, Israel’s interest lies in keeping open the possibility of relations, while there are serious
tensions among India and Pakistan.
▪ Differences in terms of technology transfer- There exist differences between India and Israel over issues related
to technology transfer, end-user agreements and a proposed free trade agreement, more so given India’s policy of
‘Make in India’.
▪ The free trade agreement (FTA) is stuck because of the concerns from the Indian domestic industry.
Challenges

▪ It is difficult to delink Israel and Palestine in India’s foreign policy, making it a significant consideration while
strategizing the diplomatic relationship with Israel and other nations in the Middle East.
▪ India’s ties with Iran are challenged in the current situation due to its close ties with Israel and the US,
making it choose between these nations.
▪ Israel’s politics dominated by its antagonistic attitude towards the Palestinians is also making it difficult for India
to enhance the diplomatic relationship.
▪ Israel’s discrimination towards minorities, especially the Jewish minorities from India is hindering the diplomatic
ties.
▪ The inflexible stance by the current government in Israel and the US makes it highly difficult for India to
maneuver and balance its ties with Iran and other nations that are against Israel.
Way Forward

▪ Taking steps to balance the differences between India and Israel is often difficult and complicated.
▪ Flexibility in favour of India’s national interest must be made the top priority of the Indian government while
dealing with Israel.
▪ India has so far been successful in balancing its interests in the Middle East, both bilaterally and
multilaterally, without taking sides with neither of the conflicting nations in the region.
▪ Maintaining apolitical ties with the Sunni-dominated and Shia-dominated Arab countries and Israel is a step in the
right direction.
▪ Development along with transfer of defence technology will help India.
▪ India can leverage its space technologies to Israel for its developmental purposes where India enjoys upper hand.
▪ An integrated approach involving government to government, government to business and business to
business interactions between Indians and Israeli agencies.

29
▪ India could adopt the three-layered Israeli strategy that goes beyond security to build a cyber system that is robust,
resilient and has strong defence capabilities.
▪ Both need to cooperate to combat growing radicalisation and terrorism, including in cyber space

30
 CH-7 INDIA-JAPAN BILATERAL RELATIONS

Basics and Background

▪ The friendship between India and Japan has a long history rooted in spiritual affinity and strong cultural and
civilization ties dating back to the visit of Indian monk Bodhisena in 752 AD.
▪ The people of India and Japan have engaged in cultural exchanges, primarily as a result of Buddhism, which
spread indirectly from India to Japan, via China and Korea.
▪ PM Modi reiterated Mutual trust and faith, understanding of each other's interests and concerns, and continuous
high level interactions, this is the uniqueness of Indo-Japan relations.
▪ Independence movement: The leader of the Indian Independence Movement, Rash Behari Bose was instrumental
in forging India–Japan relations during India’s independence movement.
▪ During World War II,The British occupiers of India and Japan were enemies during World War II. Subhas
Chandra Bose used Japanese sponsorship to form the Azad Hind Fauj or Indian National Army (INA).
▪ Post Second World War, India did not attend the San Francisco Conference but decided to conclude a separate
peace treaty with Japan in 1952 after its sovereignty was fully restored marking a defining moment in the bilateral
relations and setting the tone for the future.
▪ During the cold war: Relations between the two nations were constrained, Japan as a result of World War II
reconstruction, was a U.S. ally, whereas India pursued a non-aligned foreign policy, often leaning towards the
Soviet Union.
▪ Pokhran nuclear test: In 1998, Japan imposed sanctions on India following the Pokhran-II, an Indian nuclear
weapons test, which included the suspension of all political exchanges and the cutting off of economic assistance.
These sanctions were lifted three years later.
▪ Both nations share core values of democracy, peace, the rule of law, tolerance, and respect for the
environment in realising pluralistic and inclusive growth of the region

Political Relations

▪ Regular high level visits and engagements between India-Japan have taken place at G20 Summit held in
Osaka, G7 Summit in Biarritz in August 2019, and Eastern Economic Forum in Vladivostok in 5 September
2019.
▪ In the meeting in Vladivostok, India-Japan decided to hold the first 2+2 Ministerial Meeting at an early date.

2+2 MINISTERIAL DIALOGUE

▪ The 2+2 ministerial dialogue is seen as an upgrade of the meeting between foreign and defence secretaries of the
two countries, the first round of which took place in 2010.

31
▪ The ministerial level meeting was held after a decision to institute a Foreign and Defence Ministerial Dialogue
was taken during the 13th India-Japan Annual Summit held in Japan in 2018.
▪ 2+2 meeting aimed to give further momentum to their special strategic partnership, particularly in the
maritime domain.
▪ The two sides exchanged views on the situation in the Indo-Pacific region and resolved to work for achieving
shared objective of peace, prosperity and progress in the region.

INDIA’S 2+2 MECHANISM

▪ Japan is the second country with which India has 2+2 ministerial dialogue (USA being the other one)
▪ India and Australia also have the 2+2 at the official level.
▪ With this, India has 2+2 mechanism with all the Quad countries at some level.

Economic Cooperation

▪ The India-Japan Comprehensive Economic Partnership Agreement (CEPA) that came into force in August
2011 is the most comprehensive of all such agreements concluded by India.
▪ Japan already has invested in the $90 billion Delhi-Mumbai Industrial Corridor.
▪ Japanese FDI into India has mainly been in automobile, electrical equipment, telecommunications, and
chemical and pharmaceutical sectors e.g. Suzuki.
▪ Japanese companies have established ten Japan-India Institute of Manufacturing (JIM) in India.
▪ Cooperation in Railway Sector Mumbai-Ahmedabad High Speed Railway (MAHSR). The ambitious project is
being implemented with nearly 90% financial support and technology from Japan.
▪ The two countries have agreed to a Bilateral Swap Arrangement that would allow their central banks to
exchange local currencies for up to $75 billion. This is substantially more than the $30 billion currency swap
arrangement announced between China and Japan.
▪ Japan is the third-largest source of FDI ($28.160 billion between 2000 and June 2018) investment into India
after Mauritius and Singapore.
▪ 57 Japanese companies have committed to investing 320 billion yen in India, which is expected to create at least
3,000 new jobs.

IMPORTANCE OF THE CURRENCY SWAP AGREEMENT

▪ Currency swap typically involves the exchange of interest and sometimes of principle in one currency for the
same in another currency. Interest rates are exchanged at fixed rates through the life of the contract.
▪ It was an important measure in improving the confidence in Indian Market.
▪ It would enable the availability of agreed amount of capital to India
▪ It would also bring down the cost of capital for Indian entities while accessing the foreign capital markets.
▪ It would also give a boost to the internationalization of Indian Rupee.

Strategic cooperation

▪ Japan will supply nuclear reactors, fuel and technology to India. India is not a signatory to the non-Proliferation
Treaty (NPT), and is the only non-signatory to receive an exemption from Japan.
▪ Both countries have a rivalry with China and to counter its behaviour in the Indo-Pacific region the two countries
formed the Quad which includes USA and Australia too.
▪ Japan is only the second country after the United States with which India holding 2+2. The India-Japan 2+2
dialogue is an endorsement of the special strategic partnership between New Delhi and Tokyo.

32
Defense cooperation

▪ India and Japan held their first bilateral exercises, ‘Dharma Guardian’ and ‘Shinyuu Maitri’, in 2018. It was
held between the Armies and Air Forces of both the countries.
▪ Japan participates in the annual India-US Malabar naval exercises on a regular basis.
▪ Japan also joined the India-US Air Force exercise ‘Cope India’ as an observer for the first time.
▪ Progress in Maritime Domain Awareness (MDA). India has two centers - Information Management and
Analysis Centre (IMAC) and Information Fusion Centre – Indian Ocean Region (IFC-IOR) located at Gurugram
specifically for this purpose under the National Maritime Domain Awareness (NMDA) Project.
▪ The sale of the ShinMaywa US-2 amphibious aircraft for the Indian Navy.
▪ Japan has committed to manufacturing 30 percent of the aircraft in India and which would help in improvement of
Indian defense manufacturing.
▪ Acquisition and Cross-Servicing Agreement (ACSA): Negotiations are going on for the agreement through
which Japan could gain access to Indian facilities in the Andaman and Nicobar Islands and India could have
access to Japan’s naval facility in Djibouti.
MARITIME DOMAIN AWARENESS
▪ Maritime Domain Awareness (MDA) is the effective understanding of anything associated with the global
maritime domain that could impact the security, safety, economy or environment of the country.
▪ India has two centers - Information Management and Analysis Centre (IMAC) and Information Fusion
Centre – Indian Ocean Region (IFC-IOR) located at Gurugram specifically for this purpose under the National
Maritime Domain Awareness (NMDA) Project.

India-Japan Digital Partnership (IJDP) and Start-up Hub

▪ In view of synergies and complementarities between the two nations, “India-Japan Digital Partnership” (I-
JDP) was launched during the visit of PM Modi to Japan in October 2018 furthering existing areas of cooperation
as well as new initiatives within the scope of cooperation in S&T/ICT, focusing more on “Digital ICT
Technologies”.
▪ Startup-India (under Invest India) and Japan Innovation Network (JIN) have signed a MoU on innovation
collaboration with a focus on SDGs (Sustainable Development Goals) connecting two start-up eco-systems in
June 2018.
▪ Four Japanese investors- Mizuho Bank, Development Bank of Japan, Nippon Life and Suzuki have already
signed letters of intent.
▪ The fund aims to invest in more than 200 Indian companies focused on emerging areas such as Internet of
Things (IoT), Artificial Intelligence (AI), Machine Learning (ML), fin-tech, healthcare, consumer,
education, robotics, automation and businessto-business (B2B) software.
India-Japan Space Dialogue

▪ Both India and Japan are seeking higher cooperation in critical sectors during their space dialogue held in India.
▪ The Japan-India Space Dialogue was announced by Prime Minister and Japanese Prime Minister in October in
2018 at the end of the annual summit of both countries.
▪ This was the first ever space dialogue between both the countries.
▪ The two countries have their own systems for monitoring satellite images and ship movements in the oceans,
as the information is critical for national security as well as coastal security of the two countries.
▪ Focus area: Surveillance and Maritime Domain Awareness (MDA) of the waters in the East China Sea, the
South China Sea and the Indian Ocean will likely remain focus areas in the bilateral space collaboration.
▪ Space agencies of the two countries ISRO and JAXA focused on global navigation satellite system, space
situational awareness (SSA), space security, space-related norms and Surveillance and Maritime Domain
Awareness (MDA) of the ocean waters.

Disaster Risk Reduction

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▪ Following the 2017 MoC in the field of Disaster Risk Reduction, the Cabinet Office of Japan and Ministry of
Home Affairs of India jointly organized a series of workshops to exchange information on policy and measures on
disaster risk reduction, and to enhance cooperation between Japan and India.
Healthcare

▪ In view of the similarities and synergies between the goals and objectives India’s AYUSHMAN Bharat
Programme and Japan’s AHWIN, both sides had been consulting with each other to identify projects to build the
narrative of AHWIN for AYUSHMAN Bharat.
▪ Both sides have subsequently concluded a MoC to formalize cooperation under the overall MoC in the field of
Healthcare, which includes establishing a high-level consultative mechanism on the lines of HSR cooperation to
build robust health care partnership.

Skill Development:
▪ Under the MoC signed in 2016 to train 30,000 shop floor leaders, Japanese companies have established 12 Japan
India Institute of Manufacturing (JIM) in India and 4 Japanese Endowed Courses (JEC) in Indian Engineering
Colleges.
Sister-State and Sister-City Cooperation

▪ There are growing links between Japan’s Prefectures and States in India.
▪ As of now 7 Indian states (currently active 6 MoUs) and 3 cities/regions in India have partnered with the
Prefectures and Cities of Japan through MoUs to cooperate under diverse sectors.
Indian Diaspora in Japan

▪ In recent years, there has been a change in the composition of the Indian community with the arrival of a large
number of professionals, including IT professionals and engineers working for Indian and Japanese firms as well
as professionals in management, finance, education, and S&T research.
▪ Approximately 38,000 Indians live in Japan. The Nishikasai area in Tokyo is emerging as a “mini-India”.
Their growing numbers had prompted the opening of three Indian schools in Tokyo and Yokohama.
Importance of India – Japan Relations

▪ Wide range of interests including regional cooperation, maritime security, global climate, and UN reforms.
▪ Both India and Japan also share several common ideals like democracy, the rule of law, and human rights, in
addition to the complementarities that bind their economies.
▪ New Delhi is seeking massive investments in its infrastructure sector and Japan is a major investor. Japan’s
technological and economic prowess could accelerate India’s development by transforming its infrastructure and
manufacturing sectors.
▪ India is a big market for Japanese companies: Japan's interest in India is increasing due to a variety of reasons
including India's large and growing market and its resources, especially the human resources.
▪ Indo-Pacific and Quad: Sharing convergent interests, both countries are strongly committed to freedom of
navigation and over flights and unimpeded commerce in the open sea which is important for the stability and
security of the Indo-Pacific region.
▪ India’s Act East Policy and Japan’s “Free and Open Indo-Pacific Strategy” converge in NER as a critical
region, where, and both countries are keen to extend their cooperation to the larger Indo-Pacific region—including
the African continent.
▪ The rise of China has been an important factor, while India’s growing closeness with the US has also played a
role, as the US and Japan already have a close alliance.

Challenges

34
▪ The trade ties which have remained underdeveloped when compared to India’s trade ties with China. The
bilateral trade between New Delhi and Tokyo in 2017-18 stood at a meagre $15.71 billion, whereas the Sino-
Indian bilateral trade in 2017 stood at $84.44 billion in spite of the political tensions between India and China.
▪ The two sides have also been unable to collaborate in the defence sector in spite of huge potential.
▪ India is one of the biggest arms importers in the world, while Japan, especially under Abe, has been looking at
arms exports, though it still remains a very divisive issue within the country.
▪ Both countries have border and hegemonic issues with China. So their policy stance hinges generally on China,
rather than growing comprehensively.
▪ Both had diverging interest with respect to economic issues like on E-commerce rules (Osaka track), Regional
Comprehensive Economic Partnership etc.
▪ A challenge for government is to correct the lopsided trade and calibrate China’s market access to progress on
bilateral political, territorial and water disputes, or else Beijing will fortify its leverage against India.
▪ Balancing between Quad and Brics: India is a member of groups like the BRICS, which brings together Brazil,
Russia, India, China, and South Africa. In addition, though New Delhi has not joined the China-led Belt and
Road Initiative (BRI), it is a member of the AIIB (Asian Infrastructure Investment Bank).So India has to do a
balancing act between Quad and BRICS.
▪ Question mark on Quad: India has long adopted a non-aligned approach as opposed to the stauncher, pro-US
foreign policy stances of Japan and Australia. The failure of these nations to come up with a joint statement points
to an inherent struggle to reconcile their competing views on how best to counter the rise of China.
▪ Asia-Africa Growth Corridor (AAGC) project: there is a great deal of scepticism on the feasibility of the
AAGC itself as well as the nature of the projects embedded in it.

Way Forward
▪ India and Japan are two powerful democratic forces in Asia which are searching for more options to work and
prosper jointly. Economic front needs to be strengthened to reach “Low Hanging Fruit of Asia” wherein
demographic dividend of the India and other Asian countries can be deployed to benefit Asia as whole.
▪ While it need not be institutionalised, it should work towards a roadmap with actionable items and show tangible
results, such as by stepping up coordination in counter-terrorism, cyber security, and disaster relief.
▪ Both need to join hand to establish peace and order in not only disturbed region of Asia but of the whole world.
▪ Indo-Japan should be realistic enough to understand that in any future regional strategic scenario, because of its
economic and military strength.
▪ Pollution is a serious issue in major Indian cities. Japanese green technologies can help India tackle this threat.
▪ Smooth implementation of the prestigious high speed rail project linking Ahmedabad and Mumbai will ensure
credibility of India’s investment climate.
▪ India’s purchase of Japan’s indigenously made US-2 amphibian aircraft if successfully executed, could also
contribute to India’s ‘Make in India’ program.
▪ Both countries are also engaged in discussions on the possibilities of India acquiring Japanese technology in the
production of submarines and on cooperative research in areas like unmanned Ground Vehicle and Robotics.
▪ There are many other areas which are providing opportunities such as Africa continent, although India-Japan
presented a joint venture namely Asia-Africa Growth Corridor for the grab the African opportunities.

35
▪ Close cooperation with a democratic India, located mid-way along trade-routes connecting East Asia with the
Middle East and Africa, would be advantageous to Japan.
▪ At the same time, a technologically deficient India has much to gain from a relationship with a country like
Japan.
▪ Indo-Japan should be realistic enough to understand that in any future regional strategic scenario, because of its
economic and military strength, China will figure quite prominently so efforts should be done to keep the Indo-
Pacific multipolar.

36
 CH-8 INDIA-RUSSIA BILATERAL RELATIONS

Basics and Background

▪ Russia has been a longstanding and time-tested partner for India.

▪ Development of India-Russia relations has been a key pillar of India's foreign policy.
▪ India and Russia have enjoyed good relations since 1947 wherein Russia helped India in attaining its goal of
economic self-sufficiency through investment in areas of heavy machine-building, mining, energy production
and steel plants.
▪ Later India and the Soviet Union signed the Treaty of Peace and Friendship in August 1971 which was the
manifestation of shared goals of the two nations as well as a blueprint for the strengthening of regional and global
peace and security.
▪ After the dissolution of the Soviet Union, India and Russia entered into a new Treaty of Friendship and
Cooperation in January 1993 and a bilateral Military-Technical Cooperation agreement in 1994.
▪ Since the signing of “Declaration on the India-Russia Strategic Partnership” in October 2000 (during the visit
of President Putin), India-Russia ties have acquired a qualitatively new character with enhanced levels of
cooperation in almost all areas of the bilateral relationship including political, security, defence, trade and
economy, science and technology, and culture.
▪ Under the Strategic Partnership, several institutionalized dialogue mechanisms operate at both political and
official levels to ensure regular interaction and follow up on cooperation activities.
▪ During the visit of the Russian President to India in December 2010, the Strategic Partnership was elevated to the
level of a “Special and Privileged Strategic Partnership.”
▪ Russia assumed the BRICS Presidency in April 2015, and since then, it has been organizing a number of events
and meetings under the BRICS format.
Political

▪ New Delhi needs Moscow’s support in the former’s bid for a permanent seat on the UN Security Council
▪ The Russians have backed the Indian position on Kashmir
▪ India and Russia are engaged in several multilateral efforts that are greatly favoured by Russia such as the BRICS
and the Shanghai Cooperation Organisation.
▪ Annual Summit meeting is the highest institutionalized dialogue mechanism under the Strategic Partnership.
International/Multilateral Organizations and Connectivity Projects

▪ BRICS
1. Under the chairmanship of South Africa, EAMs attended the 2nd BRICS Foreign Ministers meeting in
Pretoria on 4th June 2018.

37
 2. NSA participated in the meeting of BRICS National Security Advisors from 28- 29th June 2019 in Durban.
3. PM participated in the BRICS summit in Johannesburg in July 2018 where he also met President Putin on the
side lines.

▪ SCO
1. Chief Justice visited Sochi from June 17-19 2019, for the 14th Meeting of Chief Justices of SCO and held
bilateral meeting with Chief Justice of Supreme Court of Russia.
2. India participated for the first time ever in the Fifth Edition of the biennial Joint Military Counter-Terrorist
Command and Staff Exercise ‘Peace Mission’ at Chebarkul (Chelyabinsk Region), from 22 Aug to 29 Aug
2018.

▪ NSG
1. Russia has been a long standing supporter of India’s membership of the Nuclear Suppliers Group.
2. This support was also reflected in the Joint Statement adopted during President Putin’s visit to New Delhi in
October for the 19th Annual Bilateral Summit.

▪ UNSC
1. In the recently adopted Joint Statement during the 19th Bilateral Summit, India & Russia reaffirmed the need
to reform the UN Security Council to better reflect the current world order and make it more effective in
dealing with emerging global challenges.
2. Russia reiterated its unwavering support to India for Permanent Membership in an expanded UNSC.
Trade and Economic Relations

▪ Intensifying the trade and economic relations has been identified as a priority area by the leaders on both the
sides as is clear by the revised targets of increasing bilateral investment to US $ 50 billion and bilateral trade to
US $ 30 billion by 2025.
▪ Recently India and Russia decided to institutionalize the CEO’s Forum and agreed to liberalize business travel
which will help boost bilateral trade
▪ Russia sees India – one of the fastest growing economies in the world – as a country that could alleviate
Russia’s economic problems.
▪ Make in India initiative would welcome Russian companies from the public and private sectors
▪ Russian firms have shown a willingness to invest in India in construction, major infrastructure projects such as
dedicated freight corridors and industrial clusters, smart cities, and engineering services, sharing technologies and
skills.
▪ Indian companies are exploring major investment options in Russia, especially in natural resources such as coal,
fertilizers, hydrocarbons, minerals, and rare earth metals
▪ In the aftermath of general economic slowdown and Russia’s ongoing dispute with the West over Ukraine issue,
Russia has emphasized on import substitution due to which, there has been a significant reduction in Russia’s
external trade.
▪ India has also been affected by this contraction in Russian exports and imports.

Minerals Pharmaceut
icals

Vehicles
Precious other than
Fertilizers Stones & railway and Electrical
Metals tramway Machinery
Import rolling Exports
During stock
During
2018
2017-18

Nuclear
Electrical Nuclear
reactors, Organic
machinery reactors,
boilers, etc. Chemicals
boilers, etc.

38
International North South Transport Corridor

▪ India, Iran and Russia had in September 2000 signed the INSTC agreement to build a corridor to provide the
shortest multi-model transportation route linking the Indian Ocean and the Persian Gulf to the Caspian Sea via
Iran and St Petersburg.
▪ From St Petersburg, North Europe is within easy reach via the Russian Federation.
▪ The estimated capacity of the corridor is 20-30 million tones of goods per year.
▪ The route primarily involves moving freight from India, Iran, Azerbaijan and Russia via ship, rail and road. The
objective of the corridor is to increase trade connectivity between major cities such as Mumbai, Moscow, Tehran,
Baku, Bandar Abbas, Astrakhan, Bandar Anzali and etc.
▪ INSTC will not only help cut down on costs and time taken for transfer of goods from India to Russia and Europe
via Iran but also provide an alternative connectivity initiative to countries in the Eurasian region. It will be India’s
second corridor after the Chabahar Port to access resource rich Central Asia and its market.
Energy Ties

▪ According to the International Energy Agency, India will cross Japan as the world’s third largest oil user this
year, and is expected to have the highest rate of growth of crude demand globally through 2040.
▪ The Russia-India investments in the oil and gas sector and exports to third countries need to be energised.
▪ Russia is an important partner in peaceful uses of nuclear energy and it recognizes India as a country with
advanced nuclear technology with an impeccable non-proliferation record.
▪ Kudankulam Nuclear Power Plant (KKNPP) is being built in India with Russian cooperation.
▪ DAE signed a trilateral MoU on cooperation in the implementation of the Rooppur NPP construction project in
Bangladesh along with the Ministry of Science and Technology of Bangladesh and Rosatom.
Defence Ties

▪ India’s defence ties with the erstwhile Soviet Union and later with Russia were a major pillar of bilateral ties.
▪ India-Russia military technical cooperation has evolved from a buyer - seller framework to one involving joint
research, development and production of advanced defence technologies and systems.
▪ BrahMos Missile System as well as the licensed production in India of SU-30 aircraft and T-90 tanks, are
examples of such flagship cooperation.
▪ Indian government recently announced the purchase of five S-400 supersonic air defence systems from Russia,
costing around $6 billion, despite threats of sanctions by US under the Countering America’s Adversaries
through Sanctions Act (CAATSA).
Countering America’s Adversaries through Sanctions Act (CAATSA)
▪ It is a USA Act which aims to counter the aggression by Iran, Russia and North Korea through punitive
measures.

39
▪ Under the Act, the Department of State has notified almost all major 39 Russian entities from defence and
intelligence sector, dealings with which could make third parties liable to sanctions.

▪ Two sides agreed that the Kamov 226 helicopter would be manufactured in India.
▪ Recent defence agreements have sent a strong message that New Delhi continues to view relations with Moscow
an indispensable element of India’s foreign policy
▪ India and Russia agreed to strengthen the defence partnership in line with the “Make in India” program.
▪ The two countries also hold exchanges and training exercises between their armed forces annually.
▪ The first-ever Tri-Services exercise –‘INDRA 2017’ took place in Vladivostok from October 19 to 29, 2017.
▪ The bilateral Russian-Indian naval exercise Indra Navy-2018 was held in the Bay of Bengal. Joint Tri-Services
Exercise ‘INDRA 2019’ between India and Russia was carried out simultaneously in Babina, Pune, and Goa from
8 10th -19th December 2019.
▪ Representatives from the Armed Forces of the Republic of India and the Eastern Command of the Russian
Federation participated in the exercises, to strengthen field, marine and flight skills as well as improve
cooperation between Russia and India's armed forces.
▪ The new initiatives will encourage joint manufacturing of defence products in India and motivate the private
sector in developing a strong defence manufacturing base in India
▪ The boost to defence engagement will also help India contain the growing engagement between Russia and
Pakistan.
Counter Terrorism
▪ Counter terrorism is another area where both countries find a convergence of interest
▪ Both countries strongly condemned terrorism in all its forms, stressing the need for an effective global effort in
dealing with the terrorist menace.
▪ They also called for the elimination, once and for all, of all terrorist “safe havens,” presumably referring to
Pakistan.
▪ India and Russia also share concerns about the aggravation of the security situation in Afghanistan, including
along its borders.
▪ India openly shared Russia’s concerns over developments in Syria
▪ India’s stance on Syria will certainly help cement its ties with Russia countering the earlier feeling that India was
not coming forward to support Russia in difficult times.
Science & Technology

▪ The Working Group on Science and Technology functioning under IRIGC-TEC, the Integrated Long Term
Programme (ILTP) and the Basic Science Cooperation Programme are the three main institutional
mechanisms for bilateral Science and Technology cooperation, while the Science Academies of the two countries
promote inter academy exchanges.
▪ A number of new initiatives in this sphere include India-Russia Bridge to Innovation, cooperation in telemedicine,
creation of a Traditional Knowledge Digital Library (TKDL), GIAN, and the Russia-India Network (RIN) of
Universities.
Space Cooperation

▪ India-Russia cooperation in the field of peaceful uses of outer space dates back to about four decades.
▪ 2015 marked the 40th anniversary of the launch of India’s first satellite “Aryabhatt” on a Russian (then USSR)
launch vehicle ‘Soyuz.’
▪ An agreement was signed between C-DAC and GLONASS for cooperation in technologies based on satellite
navigation.
Cultural Cooperation

▪ There is a strong tradition of Indian studies in Russia.

▪ Apart from Hindi, languages such as Tamil, Marathi, Gujarati, Bengali, Urdu, Sanskrit and Pali are taught in
Russian Institutions.
▪ There is general interest among Russian people in Indian dance, music, yoga and ayurveda.
▪ There are regular cultural initiatives to promote people-to-people contacts between India and Russia

40
▪ The Embassy of India through the grant provided by the Ministry of Culture of the Republic of India conducted a
six month long “Festival of India in Russia” from September 2018 to March 2019 in 22 cities with 34
performances by 10 groups, showcasing the best of Indian music, dance, food and spiritual traditions.
▪ The President of India inaugurated the Year of Indian Culture ‘Namaste Russia’ in Moscow on 10 May 2015.
Tri-lateral relation between Russia-China-Pakistan and its impact on India

▪ Russia's growing affinity with Pakistan is bound to give rise to some ruffles between India and Russia. The rivalry
between Pakistan and India only gets worse as the latter accuses the former of breaching international border
norms.
▪ Pakistan's relationship with Moscow deteriorated during 1980s, when the former allied with the West to fight the
Soviet in Afghanistan. The reason of their rivalry has yet again brought the two countries together, binding them
with defence agreements.
▪ The reason of their rivalry (Afghanistan) has yet again brought the two countries together, binding them with
defence agreements.
▪ In June 2014, Russia announced the lifting of its long-standing embargo on arms sales to Pakistan.
▪ The problem for India, of course, is the strategic import of such moves by Russia. Then again, we must realise that
our growing proximity to the U.S. reduces our leverage over Russia. As does Russia’s increasing tilt towards
China. As always, a bit of history can be useful.
▪ Russia leaning towards China to combat the pressure of the West might bring about certain changes in the
power pattern in the South Asian region.
▪ The common apprehension that India and Russia shared with regards to the long borders they shared with China
seems to have lost its significance for Russia, as Russia expands its economic, political, and security ties with
China.
▪ It would be overrated to call Russia's shift towards Pakistan a move taken by the country to bring India on
track. The combination of secure Pakistan and China backed by Russia would mean a huge challenge to India's
position in the South Asian region. The allegation however, cannot be ignored either.
▪ In a joint statement issued at the conclusion of the third meeting of Pak-Russia Inter-Governmental Commission
on Trade, Economic, Scientific and Technical Cooperation in Moscow, both, Pakistan and Russia, hoped to
collaborate in trade, economy, science, technology, agriculture, education, and culture.
▪ The growing closeness between Russia and Pakistan is seen as a threat to India's strategic defence moves.
India-Russia Strategic Economic Dialogue

▪ The second India-Russia Strategic Economic Dialogue (IRSED) was recently held in New Delhi.
▪ The India-Russia Strategic Economic Dialogue (IRSED) was established by a bilateral Memorandum of
Understanding between NITI Aayog and the Ministry of Economic Development of the Russian Federation
during the 19th edition of the Annual India-Russia Bilateral Summit in New Delhi.
▪ The First India-Russia Strategic Economic Dialogue was held in St. Petersburg in 2018.
▪ The Second meeting of the IRSED focussed on six core areas of cooperation:
1. Development of Transport Infrastructure and Technologies
2. Development of Agriculture and Agro-Processing sector
3. Small and Medium Business support
4. Digital Transformation and Frontier Technologies
5. Cooperation in Trade, Banking, Finance, and Industry
6. Tourism & Connectivity
Russian FAR EAST
▪ The 20th India-Russia annual summit and the fifth meeting of the Eastern Economic Forum (EEF) were
recently held in Vladivostok, Russia.
▪ The focus of the visit was on the development of the Russian Far East for which India has extended a $1 billion
line of credit.
▪ The Eastern Economic Forum (EEF), established in 2015 aims to support the economic development of
Russia’s Far East, and to expand international cooperation in the Asia-Pacific region.
▪ Among the participants in this fifth Summit were India, Malaysia, Japan, Australia, and South Korea.

41
▪ Earlier, a proposal for maritime route between Chennai and Vladivostok has been made. It will bypass
Europe, which would enable to transfer cargo between Chennai and Vladivostok in 24 days in comparison to over
40 days currently taken to transport goods from India to Far East Russia via Europe.
▪ Also, recently, India and Russia have finalized roadmap for a government-to-government agreement for long-
term import of crude oil by India from Russia's Far East region.
▪ The pact was part of five-year road map for cooperation in the hydrocarbons sector (2019-24).
Concern
▪ The first concerns the rapidly expanding ties between India and USA, which started with the India-US nuclear
deal in 2008.
▪ The second concerns the growing defence relationship between India and USA. Russia’s share of Indian
defense imports fell from 79 percent between 2008-2012 to 62 percent between 2013-2017.
▪ Russia’s decision to supply Pakistan with the Mi-35 Hind attack helicopters has alarmed the Indian defense
establishment.
▪ The Russia-Pakistan joint exercises raise many questions
▪ India having its own military exercises with the U.S. and has signed logistics agreements which can eventually
give the U.S. access to Indian naval bases.
▪ Growing economic relations between Russia and China. Russia has also made efforts for strategic outreach
towards China since Ukraine Crisis.
▪ Russia-China Defence ties: Recently Russia has also sold Su-30 30MKK/MK2 fighters and especially the Su-35,
S-400 long-range anti-aircraft missiles to China.
▪ Russia had proposed a Russia-India-China (RIC) forum. India is hesitant about this because of the unresolved
issues with China.
Russia-India-China (RIC)
▪ The trilateral Russia-India-China meeting.
▪ Conceived by the then Russian foreign minister in 1998, the trilateral grouping has met annually since 2002.
▪ Together, the RIC countries occupy over 19 percent of the global landmass and contribute to over 33 percent of
global GDP. All three are nuclear powers and two, Russia and China, are permanent members of the UN Security
Council, while India aspires to be one.
Importance of RIC
Strategic
▪ Despite differences India, China and Russia have converging interests in Eurasia, like, peace and stable
Afghanistan. So, they could work together as part of the RIC to ensure stable peace in Afghanistan and by
extension, in Central Asia.
▪ Regular RIC interactions could also help the three countries identify other issues where they have congruent views
like the volatile situation in the West Asia, particularly on issues like the sanctions on Iran.
▪ RIC forms the core of both the Shanghai Cooperation Organisation (SCO) and BRICS. Also, Russia can act as
bridge between India and China, as it enjoys strong relations with both.
Economic
▪ The trio could also contribute to creating a new economic structure for the world, by pushing reforms in global
economic governance and international economic cooperation.
▪ With Russia being a major exporter of energy and India and China being major consumers, the three countries
could discuss the creation of an Asian energy grid, which could go a long way in ensuring energy security for
the region as well as allow these countries to determine prices suitable to them.
RIC stand on global issues
▪ RIC countries emphasised on global issues like- reforms in UN, having Global Counter-Terrorism Strategy,
commitment to address the world drug problem, Prevention of arms race in outer space etc.
▪ The RIC countries could work together on disaster relief and humanitarian assistance.

42
▪ With the Northern Sea Route opening up due to climate change, the RIC has a common interest in ensuring that it
is not left to the West and Russia alone and that India and China make the transition from rule followers to rule
makers by helping formulate some of the rules governing the Arctic route.
Way Forward

▪ India has to rebuild on its strengths and common concerns with the Russians.
▪ Both have to revitalize their earlier agreement on sharing intelligence for a joint strategy on terrorism.
▪ Indian and Russian anxieties on terrorism need to converge and bring about some positive outcome.
▪ India needs to deepen its scientific and technological relations with Russia since a base for this already exists.
▪ Needs focus is increasing trade and investment ties between India and Russia
▪ There are enough reasons for India to remain deeply engaged with Russia as it may well become a key energy
partner as our own energy demand increases and Russia looks for markets outside Europe.
▪ India should pursue the proposed FTA with the EEU and seek to play a more active role in the SCO as a member.
▪ The cordiality and mutual trust of the past may be leveraged to fashion a new relationship but they cannot
substitute for a lack of substantive drivers in the relationship.
▪ Reinventing Indo-Russian relations is an important task facing the political leadership of both countries, who
must find ways to rejuvenate the confluence of political and strategic interests if the relationship must break out of
its current shackles.

43
 CH-9 INDIA-UNITED KINGDOM BILATERAL RELATIONS

Basics and Background

▪ India and the United Kingdom share a modern partnership bound by strong historical ties.
▪ The bilateral relationship that was upgraded to a strategic partnership in 2004, was further strengthened during the
tenure of British Prime Minister David Cameron who visited India thrice in his first term (July 2010, February
2013 and November 2013).
▪ The successful visit of Prime Minister Modi to the UK in November 2015 gave fresh impetus to the bilateral
relationship.
▪ UK Prime Minister Theresa May’s visit to India in November 2016, which was her first overseas bilateral visit
(outside the EU) after assuming office in July 2016 showcased the continuity of interactions at the highest
political level.
▪ Prime Minister Modi held wide-ranging bilateral talks with the British PM on 18 April 2018 in London to further
intensify the future partnership between both countries even in the wake of Britain’s impending departure from the
EU.
Political

▪ Politically, relations between India and the UK occur mostly through the multilateral organizations of which both
are members, such as the Commonwealth of Nations, the World Trade Organization and the Asian Development
Bank.
▪ After becoming the Prime Minister of the United Kingdom, Cameron was actively involved in enhancing the
Indian-British relationship on various dimensions, such as business, energy security, climate change, education,
research, security and defence, and international relations.

Economic Relation

▪ India is the third largest foreign investor in the UK.

▪ There are many bilateral trade agreements between the two nations designed to strengthen ties.
▪ The British government has chosen India as one of its most influential trade partners because it is one of the
“fastest growing economies in the world.”

44
▪ The upcoming UK’s post-Brexit plan would be substantial scope for further strengthening bilateral cooperation
across a range of sectors, including science & technology, finance, trade & investment, and defence & security
between the two countries.
▪ Recently, India and the United Kingdom (UK) affirmed their shared commitment towards a Free Trade
Agreement (FTA) during the 14th virtual Joint Economic and Trade Committee (JETCO) meeting.

Joint Economic Trade Committee

▪ JETCO provides a forum to United Kingdom companies to enhance their links and develop new partnerships
with India business and decision-makers.
▪ Government to Government negotiations, which address issues of market liberalization and market access, are
conducted through the JETCO process.
▪ The UK India Business Council plays a key role in feeding the views of the UK business community into the
JETCO process with a view to achieving favourable outcomes for UK companies.
▪ One of the key objectives of the JETCO process is to unveil opportunities for UK’s most prominent institutional
investors to invest in India.

Trade

▪ UK is among India’s major trading partners and during the year 2016- 17, UK ranked 15th in the list of India’s top
25 trading partners.
▪ As per trade statistics of MoC&I, India’s trade with UK in 2017-2018 was US $14.497 billion.
▪ India’s main exports to the UK are articles of apparel & clothing accessories, power generating machinery &
equipment, petroleum, petroleum products & related materials, etc.
Investment

▪ UK is the 4th largest inward investor in India, after Mauritius, Singapore and Japan with a cumulative equity
investment of US $26.09 billion (April 2000-June 2018), accounting for around 7% of all foreign direct
investment into India.
▪ India continued to be the third largest investor in the UK and emerged as the second largest international job
creator with Indian companies having created over 110,000 jobs in the UK.
Defence

▪ Cooperation in defence sector is another important pillar of bilateral cooperation.

▪ During Prime Minister’s visit to UK in November 2015, the two countries agreed to elevate their Defence
relationship by establishing capability partnerships in strategic areas.
▪ At all the three services level, joint exercises and wide-ranging exchanges between the three services are
conducted regularly.
Education

▪ Education is an important plank of the India-UK bilateral relationship. Over the last 10 years, the relationship has
grown substantially with the introduction of bilateral mechanisms such as the India-UK Education Forum, UK-
India Education and Research Initiative (UKIERI), Joint Working Group on Education, Newton-Bhabha Fund and
Scholarship schemes.
Science & Tech

▪ Science and Technology sector is the fastest growing element of our bilateral relationship.
▪ Joint investment in UK-India research has grown from less than £1 million in 2008 to over £200 million.
▪ During the erstwhile UK PM Theresa May’s visit to India, a India-UK Clean Energy R&D Centre with a focus on
solar energy storage and a collaborative R&D programme in energy efficient building materials were announced.
▪ New research partnerships worth £80 million including a new Joint Strategic group on Anti-Microbial Resistance
(AMR) with a joint investment of up to £13 million have also been established.

45
Cultural Ties

▪ Cultural linkages between India and UK are deep and extensive, arising out of shared history between the two
countries.
▪ There has been a gradual mainstreaming of Indian culture and absorption of Indian cuisine, cinema, languages,
religion, philosophy, performing arts, etc.
▪ There are several Indian cultural organizations in the UK, which have been actively promoting Indian culture by
involving the Indian Diaspora, British organizations and people.
▪ The Nehru Centre is the cultural wing of the High Commission of India in UK which was established in 1992, and
is currently one of ICCR’s flagship cultural centers abroad.
Indian Diaspora

▪ The Indian Diaspora in UK is one of the largest ethnic minority communities in the country, with the 2011 census
recording approximately 1.5 million people of Indian origin in the UK equating to almost 1.8 percent of the
population and contributing 6% of the country’s GDP.
Other Developments

▪ Access India Programme: High Commission of India, London initiated the ‘Access India Programme’ in
September 2017 for facilitating investments by UK SMEs in India. o The primary focus of the AIP programme is
on companies interested in investing in India i.e. those intending to set up manufacturing facilities as part of the
‘Make in India’ initiative.
▪ Rupee-denominated bonds: Over $3.5 billion of rupee-denominated bonds have been issued in London since
July 2016 including by HDFC, NTPC and NHAI.
▪ Green Bonds: Indian Railway Finance Corporation (IRFC) has raised $500 million via a green bond offering and
listed these instruments on the London Stock Exchange.
▪ Varanasi Smart City Development Plan: New technical assistance for the redevelopment of Varanasi railway
station under the Varanasi Smart City Development Plan will be extended by the UK.
▪ Supporting the Start- up India initiative: UK will be investing £160 million across 75 start-up enterprises, apart
from an additional £20million for a Start-Up India Venture Capital Fund.
▪ First bond index series: State Bank of India (SBI) launched India’s first bond index series for overseas investors
at the London Stock Exchange (LSE) in 2017.
BREXIT
▪ A referendum held in 2016, to decide whether the UK should leave or remain in the European Union, decided in
favour of a historic move of the UK leaving the European Union, popularly called as BREXIT.
▪ The UK started the exit process by invoking Article 50 of the EU's Lisbon Treaty. But the withdrawal
agreement reached between the EU and UK has been rejected three times by UK MPs.
▪ Having granted an extension of the Article 50 process until 12 April 2019, EU leaders have now backed a six-
month extension until 31 October 2019. However, the UK will leave before this date if the withdrawal
agreement is ratified by the UK and the EU before then.
Arguments in favour of BREXIT:
▪ Trade benefits- UK feels that it can secure better trade deals with important countries like US, China, India.
▪ Arresting reckless spending-Britain can stop sending £350 million, to Brussels every week. This money could be
spent on scientific research and new Industries.
▪ New Immigration laws- Leaving EU could help Britain reform its immigration policies which currently is
expensive and ungovernable hence can offer an open door to EU and non-EU immigrants, who could contribute to
Britain’s economy.
▪ Reasserting National Sovereignty-Those in favor of Brexit argue that leaving EU would allow Britain to
recapture its lost position in international bodies hitherto captured by EU
Arguments against BREXIT:

46
▪ Trade Imbalance: Britain avoids exporter tariffs and red-tape, which is important because nearly 45% of its trade
goes to EU. Another benefit is that being a member, Britain can obtain better trade terms, because of the EU’s
size. Brexit would damage Britain’s export competitiveness.
▪ EU Budget: The benefits outweigh the costs. According to the Confederation of British Industries UK’s annual
contribution to the EU is equivalent to £340 for each household but trade, investment, jobs etc leads to £3,000 per
year benefit to each household because of EU membership.
▪ Immigration: Leaving EU will not stop immigration to the UK. Migration crisis especially refugee crises is a
global issue requiring global efforts it’s not a country specific problem.

Issues affecting India - UK bilateral relations

BREXIT
▪ Impact on Diaspora - Many members of Indian Diaspora in Britain had voted against BREXIT because it is
likely that Indian IT Professional in Britain will face tough competition when UK will open up its border for more
skilled migration.
▪ Impact on Indian Companies in UK - A hard Brexit would inevitably impact more than 800 Indian companies
in UK in crucial sectors of British economy Indian. But data has shown that companies are increasing investments
in the UK and creating many thousands of new jobs. This demonstrates that, Brexit or no Brexit, India supports
Britain.
▪ Impact on India-EU Relations - With €72.5 billion worth of India-EU trade and €19.4 billion of India UK trade
at stake, all partners needed to think through this issue carefully in the business and commercial context. Brexit
seems to be a challenge to the India EU strategic partnership but India would need to learn to manage its relations
with the EU without UK
▪ Impact on Trade–Forging a Free Trade Agreement with India will not be a priority for UK as it leaves EU.
Instead, Britain would initially focus on tackling existing barriers to trade. But India should grab the opportunity
to fill the trade gap in UK, post-Brexit.

Visas and Immigration

▪ Illegal Migration: There are more than 1 lakh illegal Indian immigrants in UK. Britain has started putting
pressure on Indian government to ensure that Indians who have no right to remain in UK be sent back to India
▪ Latest Measures: On the other hand, a white paper on post-Brexit visas and immigration strategy has been
unveiled. It is expected to benefit Indian students and professionals, with a focus on skills rather than country of
origin. An annual cap of 20,700 on the number of skilled work visas issued will also be removed.

Terrorism
▪ In the context of Brexit, unlike the United States’ contemporary view, India continues to be hyphenated with
Pakistan in London’s outlook.
▪ India states the fact that bilateral relations went beyond the economic realm to issues such as security and
terrorism were not being heeded in Britain, despite continuous efforts by India over the past decades.

Totalization agreement

▪ The UK government has also made it mandatory for people to pay a health care surcharge as part of their
immigration application.
▪ When employees are there for a short term as part of their work, it is important that they get to keep their hard-
earned money rather than giving UK thousands of pounds of free money as social security taxes.
▪ Therefore, it is important for UK and India to sign the totalization agreement at the earliest.
▪ The totalization agreement with the UK would have exempted Indian professionals who are working for a certain
period of time in the UK from paying those social security taxes if they are paying such taxes in India.

Post Brexit Opportunities to develop bilateral relations:

47
▪ Getting rid of EU (European Union) regulations, Britain will be more flexible and increase trade between the two
nations as a result.
▪ GDP growth: As one of the fastest growing economies with a GDP growth projection of 42.9% (period growth at
constant prices) between 2016 and 2021, there are ample investment opportunities in India.
▪ Telecommunications: Globally, India ranked number 3 in 2016 in terms of investment in telecommunications at
US$13.1 bn (constant prices), making India one of the best suitors to invest in the UK’s telecommunication sector.
▪ Tariff free: In the absence of the EU-India free trade agreement, the UK expects to benefit from tariff free trade
with India.
▪ Export: Britain will be able to increase its exports to India by more than £2 billion per year after Brexit by cutting
EU red tape.
▪ There is significant potential for the growth in the export of pearls and precious stones from the UK to India, cars
and car parts and alcohol.
▪ Import: Imports from India to the UK will rise by around £1 billion, meaning the UK’s balance of trade will be
improved.
▪ Exports of U.K - made cars to India rose 8.3% in the first half of 2017, while those of Indian-made cars to the
U.K. almost doubled.
▪ The 8.3% rise in sales of U.K. cars was driven by increased demand for British-made luxury cars, while the
number of India-built cars rose by 48.6%.

Way Forward

▪ UK values its relationship with India just more than trade and India regards UK as an important player in
world politics and development. There is convergence of views on the global issues. Both believe in rule
based international order. UK is the permanent member of the UNSC and supports India for its
permanent membership. Both support for the development in west Asia.
▪ There are areas in which UK seeks India’s support, opinion and share their views with us. At a time
when UK is not the part of Europe, it is very important to have strong friends outside and India is one of
those.
▪ As the UK prepares to leave the EU, it is time to reset this relationship. Both the countries cannot afford to be
complacent or rely on historical connections to deliver a modern partnership.
▪ Britain could further its relationship with India including through security and defence cooperation, joint exercises
of the armed forces, and working with India to achieve reform at international bodies such as the UN and WTO.
Trade, security, a shared commitment to the rules-based international system — these are all factors in our
growing and evolving partnership.
▪ India is one of the fastest growing large economies of the world and FTA with the UK has played a significant
role in enhancing the trade volume of the country.

48
 CH-10 INDIA-US BILATERAL RELATIONS

Basics and Background

▪ India-U.S. bilateral relations have developed into a "global strategic partnership", based on shared democratic
values and increasing convergence of interests on bilateral, regional and global issues.
▪ Historically, the US made an ambivalent approach to the growth of India's power.
o On the one hand, it valued Indian stability and promoted those aspects that served its larger interests. That
explains the US's generosity when it came to development programs at a time when our political relations
were not at their best. When there were serious challenges such as in 1962, American policy makers were
actually anxious about our future.
o But on the other hand, they worked overtime to neutralize our regional dominance strove particularly hard to
ensure some parity with Pakistan.
▪ The emphasis placed by the new Government in India on development and good governance has created new
opportunity to reinvigorate bilateral ties and enhance cooperation under the new motto “Chalein Saath Saath:
Forward Together We Go”, which was adopted following Prime Minister Narendra Modi's first summit with
President Barack Obama on 30 September 2014 in Washington DC.
▪ Regular exchange of high level political visits has provided sustained momentum to bilateral cooperation, while
the wide-ranging and ever-expanding dialogue architecture has established a long term framework for India-U.S.
engagement.
▪ Today, the India-U.S. bilateral cooperation is broad-based and multi-sectoral, covering trade and investment,
defence and security, education, science and technology, cyber security, high-technology, civil nuclear energy,
space technology and applications, clean energy, environment, agriculture and health.

Political Relations

▪ The frequency of high-level visits and exchanges between India and the U.S. has gone up significantly of late.
▪ The recent visit of PM Modi and outgoing US President Donald Trump in the events of “Howdy Modi” and
“Namaste Trump” respectively highlighted India’s soft power diplomacy all over the world.
▪ The outcomes generated by these visits have been instrumental in further strengthening and developing the
multifaceted ties between the two countries.
‘2+2’ Dialogue
High-Level Dialogue Mechanisms
▪ 2+2 Ministerial is the highest-level
India-US 2+2 Ministerial Dialogue institutional mechanism between the
two countries.
▪ India-U.S. 2+2 Ministerial Dialogue is led by the heads of ▪ It is a format of dialogue where the
foreign and defence ministries of India and the US. defence/foreign ministers or secretaries
▪ Three rounds of this Dialogue have been held so far (in meet with their counterparts from
September 2018, December 2019 and October 2020). another country.
▪ India holds such talks with Australia,
India-U.S. Commercial Dialogue Japan and the USA.

49
▪ The India-U.S. Commercial Dialogue is led by the Minister of Commerce and Industry (CIM) and the U.S.
Secretary of Commerce.
▪ This was last held in Delhi in February 2019.

India – U.S. Economic and Financial Partnership

▪ The India – U.S. Economic and Financial Partnership is led by the Finance Minister (FM) and the U.S. Secretary
of the Treasury.
▪ This was last held in Delhi in November 2019.

India-U.S. Trade Policy Forum

▪ The India-U.S. Trade Policy Forum is led by CIM and the U.S. Trade Representative (USTR).
▪ This was last held in Washington, D.C. in October 2017

India-U.S. Strategic Energy Partnership

▪ The India-U.S. Strategic Energy Partnership is led by the Minister of Petroleum and Natural Gas 2 and the U.S.
Secretary of Energy.
▪ This was last held in Delhi in April 2018.

India-U.S. Homeland Security Dialogue (HSD)

▪ The India-U.S. Homeland Security Dialogue is led by the Minister of Home Affairs and the Secretary, U.S.
Department of Homeland Security.
▪ This was last held in Washington, D.C. in May 2013.

Trade Relations

▪ The US is one of the countries, with which India enjoys a trade surplus. Although the trade surplus is reducing
with time, it is still at $23.3 billion.
▪ From 1999 to 2018, trade in goods and services between
the two countries surged from $16 billion to $142
billion. In 2019, overall U.S.-India bilateral trade in
goods and services reached $149 billion.
▪ In 2018, the Indian manufacturing trade in the US
reached US$50.1 billion for the first time, surging by
approximately US$6 billion over the 2017 figures.
▪ The US has become India’s second-largest arms
supplier. India–US defence trade. From nearly zero in
2008, it has increased to over US$15 billion in 2018
▪ India is poised to order a record 2,300 new planes, possibly from US manufacturers such as Boeing, over the next
20 years.
▪ India’s import of US crude rose threefold in early 2019.

Trade Related Issues

Tariff barriers

▪ US officials have been critical of India’s Tariff and non-tariff barriers.

▪ In the past, President Trump has called India’s tariffs “unacceptable,” and has described India as the “king” of
tariffs.
▪ Whereas in 2018 the US levied across-the-board import tariffs of 25 per cent and 10 per cent, on steel and
Aluminium, respectively.
▪ India increased tariff on Agricultural products from the US in retaliation.

50
Non-tariff Barriers

▪ India has been putting many Non-tariff restrictions on the US products e.g.
▪ India’s restrictions on US daily products due to ‘blood-meal’, a protein-rich dietary supplement for cattle that
utilises blood from slaughtered animals.

GSP

▪ Following a public review process, the Trump administration removed India from the GSP program on the pretext
that India is prohibiting the “equitable and reasonable” access to its markets.
▪ The Generalized System of Preferences (GSP) was instituted in 1971. The 13 countries that grant GSP
preferences are: Australia, Belarus, Canada, the European Union, Iceland, Japan, Kazakhstan, New Zealand,
Norway, the Russian Federation, Switzerland, Turkey and the United States of America.
▪ It is a preferential tariff system extended by developed countries (also known as preference giving countries or
donor countries) to developing countries (also known as preference receiving countries or beneficiary countries).
It involves reduced MFN Tariffs or duty-free entry of eligible products exported by beneficiary countries to the
markets of donor countries.

Intellectual property rights (IPR)

▪ Intellectual property rights in India have been a chief U.S. concern. As per “Special 301 report” of US, India
continues to be on the ‘Priority Watch List’ of the United States Trade Representative (USTR) for lack of
adequate intellectual property (IP) rights protection and enforcement and copyright policies that do not properly
incentivize the creation and commercialization of content

Data localisation requirement

▪ India’s requirement for Fintech companies to store and process data in local servers also became a cause of
concern among US companies.

Defence and Security

▪ Defence relationship has emerged as a major pillar of India-US strategic partnership with intensification in
defence trade, joint exercises, personnel exchanges, and cooperation in maritime security and counter-piracy.
▪ India conducts more bilateral exercises with the U.S. than with any other country.
▪ Some important bilateral exercises are: Yudh Abhyas, Vajra Prahar, Tarkash, Tiger Triumph, and Cope
India.
▪ Aggregate worth of defence-related acquisitions from the U.S. is more than US$ 15 billion.
▪ The India-U.S. Defence Technology and Trade Initiative (DTTI) is aimed at promoting co-development and
coproduction efforts.
▪ The US has tried to clear all roadblocks in the way of India for making any defence related purchase e.g. India is
“the first non-treaty partner to be offered an MTCR
Category-1 Unmanned Aerial System” from US.
▪ Before the present BECA deal (being negotiated), Logistics
Exchange Memorandum of Agreement (LEMOA) and
Communications Compatibility and Security Agreement
(COMCASA) were signed between India and US. This
completes a troika of “foundational pacts” for deep military
cooperation between the two countries.
▪ India and the United States cooperate closely at
multilateral organizations, including the United Nations,
G-20, Association of Southeast Asian Nations (ASEAN)
Regional Forum, International Monetary Fund, World Bank, and World Trade Organization.
▪ In 2019, the United States joined India’s Coalition for Disaster Resilient Infrastructure to expand cooperation
on sustainable infrastructure in the Indo-Pacific region.

51
▪ US Senate and House of Representatives have passed an amendment in the National Defense Authorization Act
(NDAA) for Fiscal Year (FY) 2020 to strengthen and enhance its major defence partnership with India. This will
ensure that the US State Department treats India as a non-member NATO ally for the purposes of the Arms Export
Control Act.

BECA

▪ BECA will help India get real-time access to American geospatial intelligence that will enhance the accuracy of
automated systems and weapons like missiles and armed drones.
▪ Through the sharing of information on maps and satellite images, it will help India access topographical and
aeronautical data, and advanced products that will aid in navigation and targeting.
▪ BECA will help India get real-time access to American geospatial intelligence that will enhance the accuracy of
automated systems and weapons like missiles and armed drones.
▪ Through the sharing of information on maps and satellite images, it will help India access topographical and
aeronautical data, and advanced products that will aid in navigation and targeting.

LEMOA

▪ Logistics Exchange Memorandum of Agreement (LEMOA) was the first of the three pacts to be signed in August
2016.
▪ LEMOA allows the militaries of the US and India to replenish from each other’s bases, and access supplies, spare
parts and services from each other’s land facilities, air bases, and ports, which can then be reimbursed.
▪ LEMOA is extremely useful for India-US Navy-to-Navy cooperation since the two countries are cooperating
closely in the Indo-Pacific.

COMCASA

▪ Communications Compatibility and Security Agreement (COMCASA) was signed in September 2018, after the
first 2+2 dialogue during Mrs. Swarajs’ term as EAM.
▪ The pact allows the US to provide India with its encrypted communications equipment and systems so that Indian
and US military commanders, and the aircraft and ships of the two countries, can communicate through secure
networks during times of both peace and war.
▪ The signing of COMCASA paved the way for the transfer of communication security equipment from the US to
India to facilitate “interoperability” between their forces.

Benefits of Troika (BECA, LEMOA & COMCASA)

▪ The strengthening of the mechanisms of cooperation between the two militaries must be seen in the context of an
increasingly aggressive China.
▪ Amid the ongoing standoff on the LAC in Ladakh, the longest and most serious in three decades, thus India and
the US intensified under-the-radar intelligence and military cooperation at an unprecedented level.
▪ These conversations facilitated information-sharing between the two countries, including the sharing of high-end
satellite images, telephone intercepts, and data on Chinese troops and weapons deployment along the LAC.

The Quad

52
▪ The informal strategic Quadrilateral Security Dialogue (QSD) that was initiated by Japan’s Prime Minister Shinzo
Abe in 2007 was largely in response to China’s growing power and influence.
▪ Initially, the “Quad” members included India, Japan, the US, and Australia.
▪ In the Trump years, India signed all the ‘foundational’ agreements with America.
▪ India also bought billions of dollars’ worth of military hardware from them.
▪ India resisted converting the Quad into a primarily military or strategic grouping, and is in fact aimed solely at
containing China.
▪ Though Quad is an anti-China coalition, but how far it can be successful in containing the Dragon remains to be
seen.
▪ India’s External Affairs Minister has stated, India will not join any military alliance.
▪ However, given the fact that all the other three, and perhaps five or six in future, are already in strategic alliance
with one another and with the US, it is highly likely that India too will be forced to agree to some form of military
alliance at a future date.
▪ But no external power would want to get involved on India’s side in case of major hostilities with China.
▪ On the other hand, if there is a major skirmish or worse in the South China Sea, the other members of the Quad
will expect us to join them in fighting China, in an area far removed from our shores.

Countering America’s Adversaries Through Sanctions Act (CAATSA)

▪ CAATSA stands for “Countering America’s Adversaries Through Sanctions Act”

▪ This punitive act was signed by President Donald Trump in August 2017.
▪ It mandates US administration to impose sanctions on any country carrying out significant defence and energy
trade with sanctioned entities in North Korea, Iran and Russia.
▪ This is an act by the Congress, thus the President of the United States of America doesn’t have too much of
authority over it.

Energy and Climate Change

▪ The US-India Energy Dialogue was launched in May 2005 to Paris Agreement
promote trade and investment in the energy sector, and held its
last meeting in September 2015 in Washington DC. ▪ In December 2015, 195 countries signed
▪ There are six working groups in oil & gas, coal, power and an agreement (came into force on Nov
energy efficiency, new technologies& renewable energy, civil 2016) within the United Nations
nuclear co-operation and sustainable development under the Framework Convention on Climate
Energy Dialogue. Change(UNFCCC), dealing with
▪ Investment by Indian companies like Reliance, Essar and greenhouse-gas-emissions mitigation,
GAIL in the US natural gas market is ushering in a new era of adaptation, and finance
India-U.S. energy partnership. ▪ Objective: To slow the process of global
▪ An India-US Natural Gas Task Force was also created in 2018. warming by limiting a global temperature
India has started importing crude and LNG from the US from rise this century well below 2 degrees
2017 and 2018 respectively. Celsius above pre-industrial levels and
▪ Previously, India has walked with the US from Stockholm to pursue efforts to limit the temperature
Convention to Paris Agreement, Rio Summit, Kyoto increase even further to 1.5 degrees
Protocol and Copenhagen Summit. Celsius.
▪ The fine balance struck by India and the U.S. culminated in ▪ Another crucial point in this agreement
the Agenda 21, raising hopes for a renaissance in the areas of was attaining “net zero emissions”
both environment and development. between 2050 and 2100.
▪ US and other developed countries began to default on their
commitments and began demanding mandatory cuts from China, India and Brazil during the Berlin negotiations
(1995).
▪ The bilateral civil nuclear cooperation agreement was signed in October 2008. India and the US have a Civil
Nuclear Energy Working group on R&D activities which has met ten times and has ongoing projects under R&D
collaboration which are reviewed by the Working Group.

53
▪ A US company, Westinghouse is in discussions with Nuclear Power Corporation of India Limited (NPCIL) for
implementation of a project that envisages six AP 1000 reactors at Kovvada (A.P.). Once implemented, the project
would be among the largest of its kind.
▪ US India launched Strategic Energy Partnership, in 2018, to enhance energy security, bolster strategic alignment
etc. Nuclear Power Corporation of India Limited (NPCIL) and Westinghouse Electric Company are looking
to finalize the techno-commercial offer for the construction of six nuclear reactors. Also, India has started
importing crude and LNG from the US in recent years, with total imports estimated at $6.7 billion — having
grown from zero.

US left the Paris Agreement

▪ US formally left the Paris Climate Agreement on 4th Nov 2020, three years after President Donald Trump
announced his intention to undo what had been seen as a key achievement of his predecessor Barack Obama.
▪ During his 2016 presidential campaign, Donald Trump had
described the Paris Agreement as “unfair” to US interests, and Trend of US Retreating from Global
had promised to pull out of the agreement if elected. Initiatives
▪ So in June 2017, months after his inauguration, Trump
announced his government’s decision to quit the accord ▪ Quit the U.N. Human Rights Council
▪ The US could not immediately exit the Paris Agreement, and U.N. cultural agency UNESCO
however, as United Nations rules permitted a country to apply ▪ Pulled out of Paris accord and Iran
for leaving three years after the accord came into force, i.e. nuclear deal
November 4, 2019. ▪ Cut funding for the U.N. Population
▪ The US formally applied to leave on that day, and the departure Fund (UNFPA) and U.N. agency that
automatically came into effect on November 4, 2020, at the end helps Palestinian refugees (UNRWA)
of a mandatory year-long waiting period. ▪ Opposed a U.N. migration pact
▪ The elected Democratic President Joe Biden has long maintained
an election promise that the US would re-join the Paris Agreement.
▪ Joe Biden, who will replace Trump as US President from 2021, has proposed a $2 trillion spending plan that
includes promoting clean energy and climate-friendly infrastructure.

Science & Tech/ Space Cooperation

▪ The multi-faceted cooperation between India and the US in the field of Science and Technology has been growing
steadily under the framework of the India-US Science and Technology Cooperation Agreement signed in October
2005, which was renewed for a period of ten years in September 2019.
▪ The Indo-US Science & Technology Forum (IUSSTF) which was established by India and the US as an
autonomous, bi-national organization in the year 2000 to promote cooperation in Science, Technology and
Innovation is playing an important role in strengthening cooperation in this field.
▪ Both countries also have a long history of cooperation in civil space arena that includes cooperation in earth
observation, satellite navigation, and space science and exploration.
▪ The India-US Joint Working Group on Civil Space Cooperation regularly reviews the status of cooperation and
identifies new areas for furthering space cooperation.
▪ ISRO and NASA are also working towards intensifying cooperation in Mars exploration, helio-physics, and
human spaceflight through relevant working groups between both sides.
▪ During COVID-19, Indo-US Virtual Networks for COVID-19 were established to provide a platform to enable
Indian and American scientists from academia, to carry out joint research activities.

Cooperation on Education

▪ India and the US have very strong linkages and collaboration in the field of higher education.
▪ US is one of the most favoured destinations by Indian students for higher education.
▪ More than 200,000 Indian students are currently pursuing various courses in the US

India out of Developing Countries

54
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▪ US has recently removed India from its list of developing countries.
▪ Under the WTO rules, any country can “self-designate” itself as a developing country.
▪ But, United States Trade Representative (USTR) employed methodology that excludes countries which have per
capita GNI above $12,375 as per World Bank data, or are members of the Organisation for Economic Cooperation
and Development (OECD), G20, classified as “high income” by the World Bank or account for more than 0.5% of
global merchandise trade.
▪ India (along with other countries like Brazil, Indonesia, South Africa) was removed from the list of
developing countries.
▪ US will now on consider India as a developed country for the purpose of deciding on trade related practises and
duty concessions.

H-1B and H-4 Visas

▪ USA has ramped up H-1B denials under the executive order “Buy American and Hire American” and also H-4
visas have been issued at a much lower rate.
▪ The lottery-based H-1B visas allow US companies to employ foreign workers temporarily in specialised
occupations for three years, extendable to six years.
▪ The issuances are capped at 85,000 a year, but some employers such as universities and research non-profits are
exempt.
▪ Out of the total H-1B applications in 2018, 74% came from India. Hence, Indian applicants are most affected
by the increase in visa denials.
▪ Spouses of H-1B workers are granted an H-4 visa, through which some have been allowed to apply to work in
the US.

Diaspora and people to people ties:

▪ Indian diaspora in US is around 4.5 million which is around 1% of its population. Indian diaspora has become
important soft power in USA, that during presidential elections of USA Indian diaspora finds mention in every
political debate.

Impact of Biden’s Presidency on India

Economic Impact
1. Trade

▪ There are several ways in which the US economy, its health and the policy choices of its government affect India.
▪ For one, the US is one of those rare big countries with which India enjoys a trade surplus. In other words, we
export more goods to the US than what we import from it.
▪ The trade surplus has widened from $5.2 billion in 2001-02 to $17.3 billion in 2019-20.
▪ Under a Biden administration, India’s trade with the US could recover from the dip since 2017-18.

2. FDI and FPI

▪ The US is the fifth-biggest source for Foreign Direct Investment (FDI) into India. Of the total $476 billion FDI
that has come in since April 2000, the US accounted for $30.4 billion roughly, 6.5 per cent directly.
▪ Only Mauritius, Singapore, Netherlands, and Japan have invested more FDI since 2000.
▪ Apart from FDI the US also accounts for one-third of all Foreign Portfolio Investments (investment in financial
assets) into India.

3. Ending protectionism
▪ A Biden presidency may also see a renewed push towards a rules-based trading system across the world.
▪ Instead of outright ad-hocism as was the case under Trump — as well as a move away from the protectionist
approach that has been getting strong across the world.

Visa & People to People Relations

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▪ For instance, how a US President looks at the H1-B visa issue, affects the prospects of Indian youth far more than
the youth of any other country.
▪ Under Trump, who severely curtailed the visa regime, thanks to his policy of “America First”, India had suffered
the most.
▪ That could change under Biden, who is unlikely to view immigrants and workers from India with Trump-like
suspicion.

Technology
▪ Other points of contention between India and the US are the tricky issue of data localisation or capping prices of
medicines and medical devices.
▪ These have a better chance of getting towards a resolution as we move away from the radical approach of
President Trump to the pragmatism of a Biden presidency.

Diplomacy
▪ Further, under the Trump administration, the US sanctions on Iran severely limited India’s sourcing of cheap
crude oil.
▪ For an economy such as India, which needs a regular supply of cheap oil to grow fast, a normalization of US-Iran
relationship (and lifting of sanctions) would be more than useful.
▪ On China, too, while the US apprehensions are unlikely to be fewer. It is more likely that a Biden administration
will help India against China, instead of clubbing the two together.

Climate Action
▪ Biden has promised to re-join the Paris Climate Accord, and this may help countries such as India in dealing with
the massive challenges both technical and financial on this front.
Approach towards China
▪ If Mr. Biden adopts a more conciliatory approach towards China, India may find ourselves in a difficult situation.
▪ We do not want China to be permanently hostile to us; it will absorb huge resources, human and material.
▪ The strong rhetoric employed in relation to China will need to be tempered.
▪ Public opinion which has been worked up against China may make it difficult to do so immediately but the
government is efficient in managing and moulding public opinion.

Approach toward Iran

▪ It may be difficult for Mr. Biden to quickly reverse Mr. Trump’s adventurist policy towards Iran.
▪ It may not be possible for him given the domestic compulsions, to readopt JCPOA in its original form.
▪ But he will surely, if slowly, engage Tehran in talks and negotiations through Oman or some other
intermediary, to reduce tensions in the region.
▪ India may be able to buy Iranian oil, and sell our pharma and other goods to that country.
▪ The government may also feel less constrained in investing openly in oil and other infra projects in Iran, including
the rail project in which Indian Railways Construction Ltd has been interested.

Areas of Contention

▪ India is a high tariff country - the USA wants these to reduce and want India to have a more predictable regime.
Although the USA and India’s trade grew by 10 % per annum for the past 2 years it has much more potential.
▪ Movement of skilled persons - Current US President had always made immigration as an election theme. This
rhetoric could sharpen in the election year.
▪ Civil Nuclear cooperation deal was signed in 2008. However, because of the nuclear liability law in India and
Westinghouse’s bankruptcy, it has not taken off.
▪ USA and Pakistan relation - the USA has nuanced its position on Pakistan in the last few months.USA- Pakistan
and Taliban deal will be some of the criteria for India to test the USA. also, Pakistan has consistently lobbied with
the USA to mediate between India and Pakistan on J& K issue. However, India has consistently maintained
that India sees no scope or role for third-party involvement on Kashmir.

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▪ ‘America First’ Outlook - It magnifies the susceptibility of the bilateral dynamic to transactional. It has
created inconsistencies between ‘Make in India’ and ‘America First’ push to indigenisation.
▪ Data localisation requirements of India and the new e-commerce regulations that have become concerns for the
U.S. side.
▪ USA extraterritorial sanctions – In Trump’s presidency USA has imposed imposed several extraterritorial
sanctions (CAATSA) targeting Russia and Iran which would have direct ramifications for India.

Way Forward

▪ India has to change the nature of its economic and commercial ties with China.
▪ The areas where the bilateral partnership has the potential of evolving most positively for India relate to health,
education and science and technology.
▪ There should not be any reluctance in developing ties in defence industries, too, but it cannot be forgotten that
no country will part with any of its critical technologies.
▪ But there cannot be a substitute for developing indigenous capacity for India’s needs for weapon systems.
▪ Despite the historic nuclear deal (2008), civilian nuclear cooperation has not taken off, but the agreement with
Westinghouse to build six nuclear reactors will finally bring US nuclear energy on Indian soil.
▪ In order to counter China in the maritime domain, India needs to fully engage with the US and other partners in
the Indo-pacific region, in order to preserve the freedom of navigation and the rules-based order.
▪ In international politics, there are no permanent friends and no permanent enemies, only permanent interests in
such a scenario India must continue to pursue its foreign policy of strategic hedging.

USA’s New Security strategy (NSS):

▪ Indo-Pacific region: The document explicitly includes India in its definition of the Indo-Pacific, which stretches
“from the west coast of India to the western shores of the United States”.
▪ Combating China and Russia: They have been termed as "revisionist" powers determined to reshape the world
according to their own ideals.
▪ Budding India Alliance: It promotes a deeper partnership with India and asks Pakistan to crack down on"
transnational terrorists" operating from its soil.

▪ Tilt to Bilateralism: It favors bilateral trade deals over multi-country deals considering the countries are in fierce
competition with each other.
▪ It asks U.N. and international financial institutions to be accommodative of US’s interests rather than being
detrimental to it.

Importance for India:

▪ It recognizes India as a “leading global power” and “stronger strategic and defense partner” and seeks to
increase quadrilateral cooperation with Japan, Australia, and India.
▪ This assessment is an upgrade from “regional provider of security” in 2015 and one of “21st century centres of
influence” in 2010.
▪ It further supports sovereignty of South Asian countries indirectly referring to Belt and Road Initiative that
India has kept a distance from.

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 (UNIT-2) CH-1 INDIA – AFRICA BILATERAL
RELATIONSHIP

Basics and Background

▪ The book titled “Periplus of the Erythraean Sea” documents the presence of Indians in East Africa.
▪ The accounts of Marco Polo provides concrete evidences of relations between India and Africa.
▪ Father of India, M.K. Gandhi started his political career in South Africa, where later he became a leader and
establishes Indian Natal Congress in 1894.
▪ Before Colonial powers came to India and Africa, there was flourishing trade between west coast of India and east
coast of Africa.
▪ India and Africa share not only Colonial history but also fight against anti-imperialism, anti-apartheid, etc.
▪ Although trade declined gradually, but the independence of India and Africa again caused the momentum to pick
up.
▪ Under the banner of NAM, India sustained its effort to be a natural ally of Africa.
▪ Cementing India’s warm and friendly relations with African countries, Prime Minister Narendra Modi made state
visits to Rwanda, Uganda and South Africa from July 23 to 27, 2018.
▪ The last few years have seen an intensified engagement between India and African countries in several fields such
as trade and agriculture, and these visits reaffirmed this spirit of cooperation.

Strategic Importance

▪ Because of the proximity of horn of Africa to Indian Ocean, Africa becomes

critical to India’s security, and hence Africa holds an important geostrategic
importance.
▪ Diversification of energy sources, which is one of the stated objective of our
integrated energy policy, can also be achieved with the help of Africa.
▪ Africa not only contains rich reservoir of valuable minerals but also reservoirs
of metal such as gold, diamonds and platinum.
▪ Africa can also address India’s problem of food security by giving access to vast
agricultural land.
▪ Africa is critical to India’s security, especially the Horn of Africa region, because of its proximity with India.
The threat of radicalism, piracy, organized crime emerge from this region.
▪ Djibouti is military hub of many countries. India’s close allies like USA and France have military base in Djibouti.
India can use these military base for logistics purpose as India has logistic agreement with both countries.

Political Relations

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▪ Politically the relationship has progressed from the earlier phase of idealism and sentimentalism to a more
pragmatic and mutually beneficial partnership with African countries is on three levels- bilateral, regional,
multilateral.
▪ There were a number of a high level visit from the continent to India, including South African president Jacob
Zuma, Armendo Guebuza, the President of Mozambique.
▪ President of South Africa Mr. Cyril Ramaphosa undertook a state visit to India on 25 to 26 th Jan., 2019, he was the
state guest of honour for republic day 2019 and became the second of South Africa after President Nelson
Mandela to be the chief guest at the republic day.
▪ India is keen in helping Africa to run fast on the path of progress
▪ A resurging Africa and a Rising India together can act as a significant milestone in the south – south
cooperation.
▪ The ten guiding principles has become important to guide the
policies related to India – Africa engagement as enunciated by
the PM during its Uganda visit:
o Africa will be at the top of our priorities. We will
continue to intensify and deepen our engagement with
Africa. As we have shown, it will be sustained and
regular.
o Our development partnership will be guided by your
priorities. We will build as much local capacity and
create local opportunities as possible. It will be on terms
that are comfortable to you, that will liberate your
potential and not constrain your future.
o We will keep our markets open and make it easier and
more attractive to trade with India. We will support our
industry to invest in Africa.
o We will harness India’s experience with the digital
revolution to support Africa’s development; improve
delivery of public services; extend education and health;
spread digital literacy; expand financial inclusion; and
mainstream the marginalised.
o Africa has 60 percent of the world’s arable land, but produces just 10 percent of the global output. We
will work with you to improve Africa’s agriculture.
o Our partnership will address the challenges of climate change.
o We will strengthen our cooperation and mutual capabilities in combating terrorism and extremism;
keeping our cyberspace safe and secure; and, supporting the UN in advancing and keeping peace.
o We will work with African nations to keep the oceans open and free for the benefit of all nations. The
world needs cooperation and competition in the eastern shores of Africa and the eastern Indian Ocean.
o As global engagement in Africa increases, we must all work together to ensure that Africa does not once
again turn into a theatre of rival ambitions, but becomes a nursery for the aspirations of Africa’s youth.
o Just as India and Africa fought colonialism together, we will work together for a just, representative and
democratic global order that has a voice for one-third of humanity that lives in Africa and India.
▪ In March 2015, Indian PM visited Seychelles and Mauritius, signaling India’s intent to enhance ties with the
African Indian Ocean Rim countries. He enunciated India’s policy vision for the region by coining the term
SAGAR- Security and growth for all
▪ India provides a useful model for Democratic development for new and aspiring democracies.
▪ India’s ambition to become a permanent member of UNSC makes it imperative that it engages with all 54
countries of the continent.
▪ India is keen to enlist support of African Nations in international peace and security, poverty reduction and
cooperation and partnership on human resource development, health, capacity building and ICT.

India- Africa Diplomatic ties

▪ From 2015-2019, India has hosted around 35 African leaders.

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▪ And from Indian side, 29 visits of African countries at the level of President, Vice President and Prime Minister
have already taken place.
▪ In March 2018, the government of India took decision of opening up of 18 new embassies in Africa and it
culminated into establishment of embassies in 5 countries
such as Rwanda, Djibouti, Equatorial Guinea, The
Republic of Guinea and Burkina Faso. Further opening up
of 4 more embassies took place in Feb 2020.
▪ Such a diplomatic engagement brings the Africa more
closer to India.

India - Africa Forum Summit (IAfs)

First IAFS, 2008

▪ It was held in 2008 at New Delhi.

▪ Important outcome was that India offered duty free market
access to least Developed Countries of Africa.

Second IAFS, 2011

▪ It was held at Ethiopian capital Addis Ababa.

▪ India extended $5 billion soft loan to African development project.
▪ India also helped in institution building and gave training fellowships to African students.

Third IAFS, 2015

▪ It was held at New Delhi, which was attended by 54 heads of African nations.
▪ This was the largest gathering of foreign dignitaries since the Nam summit of 1983.

Key Highlights

▪ Climate Change: India invited African nations to join an alliance of solar energy rich countries (Sun-Shine
Countries).
▪ Terrorism and Defence: This was a widely discussed issue between heads of African nation and Indian PM.
Africa wants to increase its capabilities of their defence forces and has a robust intelligence sharing mechanism
with India.
▪ UNSC Reforms: Top agenda of India at IAFS 2015 was to win support of African nations for permanent seat at
UNSC, were India got positive response from most of the nations.
▪ Trade and Development: India extended $10 billion concessional credit for Africa over next five years. India
also gave 50000 scholarships to African students in India. India and Africa development fund of $100 million and
an India-Africa fund of $10 million are included in umbrella assistance of $600 million to African continent.

Economy Indian Technical Economic

Cooperation
▪ Africa can help us in diversifying our energy sources, which is one of
the stated objective of our Integrated Energy Policy It is a bilateral assistance programme
▪ Africa also contains rich reservoir of valuable minerals, metals run by Government of India.
including gold and diamond
▪ Africa provides a space for Indian investment It is demand driven, response oriented
▪ Africa has ample agricultural land which cab address India’s food programme that focuses on addressing
security. India is looking at leasing land in Africa to overcome the the needs of developing countries
land deficit that we face in terms of arable land. through innovative technological
▪ Investment opportunities for private sector- A number of Indian cooperation between India and
multinationals already have significant interests and investments in partnering nation.
the region, with strategic sectors including agribusiness,

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 pharmaceuticals, information and communications technology (ICT), and energy.
▪ Convergence of interest- Two partners are aligned on the outstanding issues at the WTO and are in favor of
multilateral trading systems. At the Bali Ministerial in 2013 too, Africa and India had united in seeking an interim
mechanism for safeguarding minimum support prices to farmers against WTO caps till a permanent solution is found
and adopted.
▪ Asia-Africa Growth Corridor (AAGC): India and Japan agreed to an economic cooperation agreement to create
a “free and open Indo-Pacific region” by rediscovering ancient sea routes and creating new sea corridors that
will link the African continent with India and countries in South-Asia and South-East Asia and further counter
China’s BRI project.
▪ Some facts which highlights India’s engagement with Africa can be listed as:
o India-Africa trade reached $62 billion in 2018 compared to $39 billion during 2009-10.
o Africa is the second-largest recipient of Indian overseas assistance, after Asia with Lines of Credit
(LOC) worth nearly $10 billion (42 per cent of the total) spread over 100 projects in 41 countries.
o India has established dedicated Development Partnership Administration in India’s MEA for effective
implementation of projects under LOC.
o Successful utilization of the Indian Technical and Economic Cooperation (ITEC) programme has been
a manifestation of South-South cooperation that effectively exists between India and Africa.
o Focus Africa was launched in India by Ministry of commerce to extensively engage the nation with sub-
Saharan countries in relation to trade and investment.
▪ Much of capital flows from India is concentrated in extractive sources, such as oil and mining with significant
diversification in recent times like apparel, retail ventures, fisheries, commercial, real estate, transport, tourism
etc.
▪ NEPAD (New Economic Partnership for Africa’s Development) initiative was launched by African countries
to seek support from the Indian Government.

African-Asian Rural Development Organization (AARDO)

▪ African-Asian Rural Development Organization (AARDO) formed in 1962, is an autonomous inter-

governmental organization comprising 33, 17 from Africa, 15 from Asia as full members and one associate
member from Asia.
▪ AARDO is devoted to develop understanding among members for better appreciation of each other’s problems
and to explore, collectively, opportunities for coordination of efforts for promoting welfare and eradication of
thirst, hunger, illiteracy, disease and poverty amongst hundreds of millions of rural people.
▪ AARDO has its headquarters in New Delhi, India. India, one of the founding members of the AARDO, is the
largest contributor in terms of membership contribution.
▪ The Mission of AARDO is to catalyze efforts of the Afro-Asian countries, to help them “restructure their
rural societies and to reconstruct the economy of their rural people”, by launching concerted, and wherever
possible, cooperative action with determination, by the member countries of the Afro-Asian region.

Science and Technology cooperation

▪ Pan African e-Network Project is an Information and Communication Technology (ICT) project between
India and African Union.
▪ The project is implemented in the areas of tele-education, telemedicine, Voice over Internet Protocol,
infotainment, resources mapping, meteorological services, e-governance and e-commerce services.
▪ India’s generic drugs are used heavily, due to their relatively cheap prices, to fight HIV/Aids in Africa.
▪ African Asian Rural Development Organization (AARDO) and Central Marine Fisheries Research Institute
(CMFRI) recently held a workshop recently in Kochi that focused on food security, agriculture, and
fisheries.

Energy Cooperation

▪ India gets over 7% of its oil from Middle East, to diversify the energy basket, India has been working hard to
nurture its relation with African countries.
▪ India has invested in oil and gas blocks in various regions, as Africa is the latest hotspot of the world oil energy.

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Culture

▪ The role of art and culture as a means to bring the two peoples closer together has been rapidly increasing in scope
and impact. Indian films, arts, dance, music, literature and crafts have reached in almost all parts of Africa. They
continue to gain in popularity.
▪ ‘Shared History: An Indian Experience’ has continued to return to South
Africa every year, attracting divergent people from ‘the Rainbow Nation’ to
some of India’s best offerings in classical and popular culture.
▪ India’s crafts, costumes and cuisine have left a deep impact in many
African countries. The reverse inflow of African influences should not be
ignored. Whenever a good quality African dance or music troupe visits
Indian cities, it impresses audiences. What is required is more exposure of
the Indian viewer and listener to the rich heritage of African culture. Greater
attention needs to be paid to enhance cultural cooperation between the two
sides.
▪ Sports have been another potent connector. Cricket is the popular bond,
and also football to a degree. Indian sportsmen can learn much from their
African counterparts when it comes to track events, especially marathons.

Tourism

▪ The number of Indian tourists to select African countries – Mauritius, South Africa, east African countries – has
been increasing steadily, though slowly. India too is in a position to welcome a much larger number of African
tourists.
▪ What is needed is a coherent strategy that focuses on creating new civil aviation links, innovative tourism
packages and a change in mindset. Both sides should realize that their countries have much to offer as attractive
tourist destinations.

People to People

▪ Peoples of Africa and India represent a third of humankind. They have known each other since ages.
▪ Of the three pillars of Africa-India engagement, namely Government-to-Government (G-to-G), Business-to-
Business (B-to-B) and People-to-People (P-to-P) ties, the third pillar is unique in many ways. It dates back to
prehistoric times; and it has immense potential for expansion in the future.

Peace keeping operation:

▪ India is the largest contributor to UN-mandated peacekeeping and other operations in Africa, with more than 30,000
personnel involved in 17 of 22 total missions in the region since 1960.

Support in Fight against Covid-19

▪ India has provided medical assistance to 25 African countries.

▪ MEA has extended the e-ITEC course on “COVID-19 Pandemic: Prevention and Management Guidelines
for Healthcare Professionals” to Healthcare workers in Africa.
▪ India may expand the e-VidyaBharti (tele education) project to establish an India-Africa Virtual University.

Areas of Concern

▪ China is causing resentment among the locals by bringing its own laborers rather than creating jobs in name of
investment. Chinese model is also criticized for creating huge debts for nations in which it sets up project.
▪ India’s poor knowledge about Africa, often based on colonial stories and selective reports on famines, droughts
and wars, have created distorted image, same goes vice-versa.
▪ India does not have a coordinated Africa policy as both business institutions are working in different spheres.
▪ Various conflicts in Africa, such as ethnic and religious creates governance issues and hinder the growth of
foreign investments.

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▪ Political instability in number of African Nation may impact India’s long-term investment opportunities.
▪ There has been an extraordinary increase in terrorist attacks by extremists connected to al-Qaida and ISIS across Africa
over the recent years.
▪ Recently, there have been racial assaults on Africans based in India. These assaults generate a negative image of India
in Africa.

India and China: Two Competitors in Africa

Given the huge importance of Africa in recent times both China and India are trying to strengthen their ties with
African nations.

SECTORS INDIA’S ACTIONS CHINA’S ACTION

ECONOMIC SECTOR ▪ India’s investment in African ▪ Chinese approach towards aid
continent is growing steadily in partnership to African countries is
various sectors with which India more traditional in nature – focusing
has become the fifth largest on resource extraction, infrastructure
investor in Africa, with cumulative development, and elite level wealth
investment at over USD 54 billion. creation.
▪ Significant investment have been ▪ While Chinese projects seems to serve
made in oil and gas, mining, the quest of African nations to build a
baking, pharma, textiles and other sound infrastructure, a closer
sectors. examination reveals that they serve
▪ Several Indian companies have Beijing’s ambitions to write the rules
entered into joint ventures in of the next stage of globalisation.
Africa. ▪ There has been multiple concerns over
▪ Africa has been hugely benefitted Chinese labour practices, often viewed
by India’s Duty Free Tariff as unfair, with various cases reported
Preference Scheme. of poor and harsh working conditions
▪ Although India and Africa’s
economic relations are modest
compared to China, India has
numerous advantages, including
proximity, a common language,
popularity of Indian culture, and
the appeal of democracy.
DEFENCE SECTOR ▪ India contributes to defence and ▪ China’s role in peace and security has
security in African continent grown rapidly through arms sales,
through peacekeeping, setting up military cooperation and peacekeeping
defence Academies, deployment of deployments in Africa.
training teams and contribution of ▪ This rising role in security undergirds
Indian Defence Forces in Beijing’s economic statecraft and
humanitarian assistance and commercial interests in Africa, helps
disaster relief operations. professionalise China’s military and
▪ India has made available defence protect its citizens there, and furthers
equipment and supply to African its ambitions to be a major power with
countries through its robust India- global influence
Africa development partnership
SOCIAL SECTOR ▪ Some recent contribution of India ▪ Over the past two decades, China has
includes: helped in Africa’s infrastructure
o Construction of Presidential financing needs and it is now the
Office in Ghana, National single largest financier of African
Assembly building in Gambia, infrastructure, financing one in five
Kosti Power plant in Sudan, projects and constructing one in three
Rift Valley Textiles factory in ▪ Most funded projects are in the
Kenya, water treatment Transport, Shipping and Ports sectors

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 projects in Tanzania, sugar (52.8 per cent), followed by Energy
factories in Ethiopia, and IT and Power (17.6 per cent), Real Estate
Parks in Mozambique and E- (14.3 per cent, including industrial,
Swatini (Swaziland) commercial and residential real estate)
▪ Unlike China, India’s partnership and Mining (7.7 per cent)
with Africa is based on a model of ▪ China is connecting with Africa
cooperation that is responsive, through its Belt and Road Initiative.
demand-driven, free of ▪ One frequent criticism of these
conditions and one that liberates projects is that such projects have
Africa’s potential, rather than produced little real benefit for local
constraining its future. economies while increasing their debt
burden.

Way Forward

▪ First, we need to take direct control of our development programme instead of handing our funds to
intermediaries whose priorities are often different from India’s.
▪ To make an impact, our aid should be disbursed bilaterally and aligned with national priorities of the recipient
state, which should be a substantial stakeholder and co-investor in schemes and projects from initiation to
operation.
▪ Second, India’s development assistance should prefer the countries with its substantial interests, both existing
and potential.
▪ For instance, Nigeria, South Africa, Egypt, Ghana, Angola and Algeria are India’s top six trading partners in
Africa, accounting for nearly two-thirds of its trade and half its exports to the continent; yet, they do not figure
commensurately in India’s developmental pecking order.
▪ India’s own needs for raw materials, commodities and markets should be factored in its aid calculus.
▪ Third, we ought to prefer aiding countries which are willing to help us from access to their natural resources
to using our generics.
▪ Fourth, the aided project selected should be compatible with local requirements. They should be cost-effective,
scalable, future ready and commercially replicable.
▪ Fifth, for greater transparency, India should prefer its public sector to implement the aid projects.
▪ Sixth, the Indian Head of Mission in the recipient African state must be an integral part of the aid
stream including project selection, co-ordination and implementation.
▪ Apart from empowering our diplomacy, this would ensure better harmonisation between our aid and economic
objectives.
▪ Finally, the aforementioned should not distract us from our duty to provide the needed humanitarian
assistance to Africa: to be rendered promptly and with sensitivity, but without noise.

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 CH-2 INDIA – BRAZIL BILATERAL RELATIONSHIP
Basics and Background

▪ India and Brazil share a close and multifaceted relationship which is based on shared democratic values and
convergence of views on many global issues.
▪ Diplomatic relations were established in 1948, with both countries opening the embassies in the same year.
▪ India has a Consulate General in Sao Paulo while Brazil has a Consulate General in Mumbai. India later moved its
Embassy from Rio to Brasilia in 1971.
▪ India’s first cultural centre in Latin America opened in Sao Paulo in May 2011.
▪ The two countries cooperate not only bilaterally but also at multiple fora such as BRICS, IBSA, G-20 and in
multilateral bodies such as the UN and WTO, among others.
▪ India-Brazil relations were elevated to a Strategic Partnership in 2006, thereby heralding a new phase in
bilateral ties.
▪ Brazil played a crucial role in India-Mercosur Preferential Trade Agreement (PTA) that improves India’s
access to the large South American market.
Facts about India-Brazil Relations
▪ Combined GDP is of around USD 4.5 trillion
▪ Have a total population of 1.5 billion
▪ The volume of bilateral trade in 2018-10 was USD 8.2 billion which included USD 3.8 billion worth of Indian
exports to Brazil and USD 4.4 million as imports by India.
▪ But total trade stands at an underwhelming $7 billion, barely up from 2004 when for the last time a Brazilian
head of state attended Republic Day, standing at $1.5 billion.
▪ Meanwhile, Brazil’s trade with China has ballooned from $4 billion to over $100 billion in the same period.
▪ And India’s trade with China hovers at around $90 billion.

Political Cooperation
▪ The strategic partnership established in 2006 between Brazil and India has deepened, with both countries
cooperating closely within BRICS, IBSA, G4, G20, and the wider multilateral context of the United Nations.
▪ Brazil and India (along with Germany and Japan) jointly pursued aspirations of permanent seats in the UN
Security Council and worked towards a multipolar world where large developing countries can frame global rules
and democratize international institutions.
▪ Both countries played a pivotal role as leaders of the Global South or South-South cooperation.
▪ The Brazilian foreign policy of reciprocal multilateralism is in concurrence with India's policy of strategic
autonomy.

Reciprocal multilateralism & Strategic autonomy

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▪ Reciprocal multilateralism: The rules of multilateral order should benefit all nations, and not being merely
dictated by the superpowers for their benefit.
▪ Strategic autonomy: It denotes the ability of a state to pursue its national interests and adopt its preferred foreign
policy without being constrained in any manner by other states.

Trading ties
▪ Trade between India and Brazil during 2018-19 was worth $8.2 billion, including Indian exports of $3.8 billion
and imports worth $4.4 million., down from $11.4 billion in 2014.
▪ The main items of export from India to Brazil are diesel, organic chemicals and pharmaceutical products, man-
made filaments, nuclear reactors, boilers, machinery and mechanical appliances, textile products (synthetic
filaments/fibres, cotton, apparels, accessories etc.). Main items of imports by India were Petroleum products,
mainly crude oil, cane sugar, copper ore, soya oil and gold.
▪ Under India-Brazil Action Plan, Nations also set target of $15 billion for bilateral trade by 2022, up from
currently about $8 billion.
▪ Trade Monitoring Mechanism: India and Brazil have established an institutional mechanism to monitor and
identify bottlenecks in bilateral trade and take appropriate measures to address them.

India-MERCOSUR PTA

▪ MERCOSUR is a regional grouping comprising Brazil, Argentina, Uruguay and Paraguay.

▪ India signed a Preferential Trade Agreement (PTA) with MERCOSUR in 2004.
▪ Both sides agreed to expand the India-Mercosur PTA from its current list of 450 items as it would unlock the
potential to enhance trade ties.
▪ The last meeting with MERCOSUR, was held on 24 September 2019 via video Conferencing

Investments
▪ In 2018 Indian investments in Brazil were around $6 billion and Brazilian investments in India are estimated at $1
billion.
▪ ONGC, Videocon, TCS, Wipro, Infosys, Cadilla, Mahindra, L&T etc have significant presence in
Brazil. Brazilian companies in India include Marco Polo (automobiles), Vale (biggest mining company),
Stefanini (IT), Gerdau (Steel).

Energy
▪ ONGC Videsh is involved in hydrocarbon exploration in the Brazilian waters. It recently made a significant
discovery of natural gas there.
▪ Brazil has also joined India-led International Solar Alliance to give a push to renewable energy in the
developing countries.
▪ Bio-energy sector offers large business potential for Brazilian companies, who are already leaders in this sector.
India and Brazil are already co-operating in multilateral forums such as Bio platforms. 'National Biofuel Policy'
of India and 'Renova Bio' Programme of Brazil have some common objectives related to increase in the current
blending percentage of bio-fuel with Petro and Diesel.

Animal Husbandry

▪ Recognized the common genetic heritage in cattle in India and Brazil and agreed to collaborate in assisted
reproductive technology that is expected to help increase dairy production in India.
▪ Welcomed the decision to set up a Centre of Excellence in Cattle Genomics in India with Brazilian assistance

Defence cooperation

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▪ Brazil and India have signed a bilateral ‘Defence Cooperation Agreement’ in 2003 that calls for cooperation in
defence-related matters, especially in the field of Research and Development, acquisition and logistic support
between the two countries
▪ Under the framework of the agreement, a ‘Joint Defence Committee (JDC)’ has been set-up that meets at regular
intervals.

Cooperation in the field of Cyber Security

▪ MoU signed on cooperation in the area of Cyber Security between CERT-In and its counterpart agency during
the State visit of President Bolsonaro in January 2020.
▪ India and Brazil also cooperate in cyber issues at BRICS and IBSA.

Space Cooperation

▪ India and Brazil signed a framework agreement for peaceful use of outer space in 2004 as well an Agreement
inter-institutional cooperation between the space agencies.
▪ Both countries have been collaborating in Data sharing and satellite tracking of Indian satellites.
▪ As part of the UNISPACE+50 (50th Anniversary of first UN Conference on Space) initiative, ISRO organized an
8-week long training programme on nanosatellite building. This programme, named as ‘UNNATI’ (UNispace
Nanosatellite 5 Assembly & Training by ISRO), saw participation by two officials from Brazilian Space
Agency (AEB)

Cultural ties
▪ There are over 9000 Indians or PIOs in Brazil, who act as the carriers of Indian cultural values.
▪ Brazil is witnessing a renewed interest in Indian culture, arts, philosophy and religions. Yoga, Ayurveda and
Bollywood are hugely popular among Brazilians.
▪ Mahatma Gandhi is highly regarded in Brazil and the government and NGOs are trying to inculcate the
philosophy of non-violence among students, youth and police. Statues of Mahatma Gandhi have been installed in
Rio de Janeiro, Sao Paulo and Londrina.

ITEC Programme
▪ Brazil is among the 160 odd beneficiaries of the Programme and many Brazilian students and diplomats have
received training under it.
Global politics
▪ Both countries are thriving democracies and as such are vocal for democratic rights of people across the world.
▪ As leading countries in the Third World, they are a critic of Neo-imperialism by the West and exploitative
practices of MNCs. Both are critical of unilateral actions of the Western nations, e.g. NATO bombing of
Yugoslavia in 1999, violation of Libya’s sovereignty in 2011, US’s aggression against Iran etc.

Cooperation in Science and Technology (S&T)

▪ Science and Technology (S&T) is another key area of co-operation. The Agreement on S&T Cooperation between
India and Brazil was signed on 12 September, 2006. A Program of Scientific and Technological Cooperation (PoC
S&T) for the period 2020-2023 was signed during the recent State Visit of President Bolsonaro to India.
▪ In order to encourage implementation of new technologies in Agricultural sector, the first edition of the Maitri-
Indo-BrazilAgritech Cross-Incubation Programme is currently underway.

Significance of India-Brazil Relations

Food security

67
▪ Brazil is among the largest producer of agricultural products like coffee, soybean, crop-based ethanol, sugarcane,
corn, beans, fruits, vegetables etc. Thus it can play a crucial role in India’s food security, in addition
to manoeuvring inflation cycles.
Mineral resources
▪ Brazil is also rich in mineral resources like gold, bauxite, iron ore, tin diamond, Platinum copper etc which India
struggles to meet from domestic production.
Energy security
▪ India imports over 80% of its oil consumption and over 45% of its natural gas needs.
▪ Brazil, on the other hand, is the 10th largest producer of oil, 2nd largest known oil shale, 6th
highest uranium reserves and has expertise in hydropower production.
▪ It has also been a pioneer in ethanol production from crops.

Market
▪ Brazil provides a huge market for India’s export diversification drive in agricultural products (including dairy
products & meat), automobiles, electronic goods, handsets,
▪ Its comparative edge in Pharma and the IT sector can be leveraged in Brazil as well.

Poverty reduction
▪ Both countries are home to millions of poor and face the challenges of providing affordable healthcare, food,
education and employment to their population.
▪ They can learn from each other’s best practices e.g. Bolsa Familia social security programme in Brazil
and Aadhaar based cash transfers in India.

Soft Power
▪ Brazil can act as a gateway to project India’s soft power in South America. This can attract tourists from all over
South America to India, bring in forex reserves.
Reforms in global governance
▪ Both the countries are vocal advocates for reforms in Institutions of global governance to give equitable weightage
to the Global South. This includes IMF quota reforms and securing for themselves a permanent seat at the
UNSC.
South-South Cooperation
▪ Being a victim of colonialism and neo-colonialism, both countries favour deeper cooperation among the members
of the Third World including intra-Third World Funding for socio-economic development projects.
▪ The South-South Cooperation Fund under IBSA Initiative, where both countries are major contributors, seeks to
realise this objective.

New Development Bank

▪ Created by the BRICS, the Bank finances infrastructure projects in member countries at non-exploitative terms,
unlike the IMF which often demands excessive course correction. 40 Projects worth over $12 billion has been
sanctioned till date.
▪ India alone accounts for a third of the total financing by the Bank (e.g. Rs 6,000-crore loan to Andhra
Pradesh for social infrastructure projects).

Outcome of Brazilian President’s Visit to India during Republic Day 2020

• The two countries signed 15 agreements across various fields including oil and gas, mineral resources, traditional
medicine, animal husbandry, bio-energy and trade & investment,

68
• They have set an ambitious target of $15 billion annual trade by 2022, from the current $8.2 billion in 2018-
19.
• Under the Action Plan signed, existing mechanisms, as well as the goals of the Action Plan, have been grouped
in six major thematic areas:
o political and strategic coordination;
o trade and commerce, investments, agriculture, civil aviation and energy mechanisms;
o science, technology and innovation, space cooperation, environment and technical cooperation, health
mechanisms;
o defence and security;
o culture and education;
o consular issues, social security and legal cooperation mechanism.
• The India-Brazil Joint Commission for political, economic, scientific, technological and cultural cooperation
will be the main forum for monitoring the implementation of the Action Plan and will convene every two
years.
• Brazil has also agreed to solve the matter of the Indian Government’s sugar subsidy in a bilateral way,
instead of using the WTO Dispute Settlement Mechanism.
• An MoU has also been signed between Invest India & Brazil’s Trade and Investment Promotion
Agency (Apex Brazil) to implement the Investment Cooperation and Facilitation Treaty.

Challenges
▪ Brazil has filed a complaint at the World Trade Organisation against New Delhi’s subsidies to sugarcane
farmers. Brazil is the largest producer and exporter of sugar and claims Indian subsidies are inconsistent with
global trade rules.
▪ Brazil already counts China as its number one trade partner. India is facing difficulty to compete with deep
pockets of China.
▪ Though BRICS as a group has tremendous potential to grow, it has also received criticism for not having a
common vision.
▪ India and Brazil have developed divergence on climate change cooperation as India is committed to combating
global warming while Brazil has rejected scientific studies on climate change.
▪ Brazil lacks a strategic vision towards the Indo-Pacific region while India also does not have a dedicated South
America policy.
▪ Frequent political and civil unrest in South America desists India to expand its presence in the region, apart
from discouraging business prospects.
▪ So far, Bolsonaro’s foreign policy was unable to articulate a coherent strategy towards Asia, let alone to
India. However, we can expect pragmatism to prevail over ideology in Brazil’s approach to the Indian
subcontinent .
India-Brazil WTO dispute
▪ India is the world’s leading producer of sugar while Brazil is the 2nd largest producer. However, Brazil’s sugar
export of 21.26 MMT accounts for 45% of global sugar exports against India’s 2 % share as of 2018, as per the
International Sugar Organization.
▪ Brazil’s arguments
▪ Brazil has alleged that India's support (in the form of FRP by the Centre and SAP by the States) to the cane
farmers exceeds the levels of domestic support allowed to India under the WTO's Agriculture Agreement which is
10 % of the total output.
▪ Brazil has also flagged the issue of India providing prohibited export subsidies.
▪ India’s stand
▪ India has maintained that the supports were not having a trade-distorting effect on the global sugar market and are
intended to provide for and avoid the over-exploitation of 35 million vulnerable, resource-poor farmers in the
country.
▪ The Govt only announces Fair & Remunerative Price to be paid by Sugar mills to the farmers.
▪ There are very few Public sector mills in the country and the Govt as such neither pay nor procure sugar from
them.
▪ Brazil is supported by Guatemala and Australia at the WTO.

69
▪ WTO allows members to approach its Dispute Settlement Body in cases bilateral mechanism fails. In case the
DSB rules against India, it will have the option to approach the Appellate Body of the DSM.

Way Forward
▪ Both countries must create an environment conducive to trade and investment by cutting into red-tapism and
by providing stable social and political order.
▪ The underutilised areas of trade in fields like agriculture, mining. IT, Pharmaceuticals etc shall also be given a
renewed push. A free trade agreement favourable to both countries can be worked out in this direction.
▪ Establishing a Two plus Two mechanism for regular high-level meetings can also act as a channel for deeper
cooperation.
▪ Direct air connectivity and more diplomatic missions to each other can cater to the needs of increasing people
to people contacts.
▪ The Bilateral Investment Treaty that has been under the table since 2016, needs to be concluded on a priority
basis, so as to ease and boost investment into each other’s market.
▪ India must utilise Brazil’s expertise in Hydropower generation to realise the objectives of its New
Hydroelectric Policy 2019. This can also help us in cutting our GHGs emissions.
▪ Brazil’s success in anti-poverty programmes like Bolsa Familia can be replicated in India as it still holds 369
million multidimensionally poor population as per UNDP 2019 global Multidimensional Poverty Index.
▪ Brazil can also play a crucial role in defusing the chaos in Venezuela which has significantly impacted India’s
energy security.
▪ India, being one of the most vulnerable nations in terms of the impact of climate change, shall play its part
in nudging Brazil’s current negligence of Global warming and Climate Change as was evident in its response
to the unprecedented Amazon forest fires of 2019.
▪ Brazil & India being two large democracies can cooperate across various multilateral fora like the UN, WTO,
G77, BRICS etc. platforms to establish and ensure a just, equitable, and rule-based multilateral world
order even as the USA and China lock horns to pursue their own versions of weltpolitik in a renewed Cold war.
▪ Brazil can be a powerful ally in the international arena, as India p ositions itself as a global leader. As the
largest economy in Latin America and main partner of India in the region, Brazil offers a big market for
a wide variety of Indian manufactured goods, a port of entry to the subcontinent and a large supply of
natural resources.
▪ Brazil can also assist India in meeting its target of 175 GW power generation from renewable energy
sources, given its experience in bio-fuels, including the most advanced ethanol program in the world.

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 CH-3 INDIA – IRAN BILATERAL RELATIONSHIP

Basics and Background

▪ India-Iran relations span centuries marked by meaningful
interactions.
▪ Although a dominant power in the Persian Gulf, Iran itself is
primarily a land power. India’s contacts with Iran have been
traditionally over land, not across the Arabian Sea. (Challenge and
Strategy Rethinking India's Foreign Policy: Rajiv Sikri)
▪ The two countries shared a border till 1947 and share several
common features in their language, culture and traditions.
▪ India and Iran have friendly relations in many areas, despite India
not welcoming the 1979 Revolution.
▪ There are significant trade ties, particularly in crude oil imports into
India and diesel exports to Iran.
▪ Iran frequently objected to Pakistan's attempts to draft anti-India resolutions at international organisations such as
the OIC and the Human Rights Commission.
▪ India welcomed Iran's inclusion as an observer state in the SAARC regional organisation
▪ Both South Asia and the Persian Gulf have strong commercial, energy, cultural and people-to-people links.
▪ India and Iran established diplomatic links on March 15, 1950. In addition to the Embassy in Tehran, India has
two Consulates in Iran, one in Bandar Abbas and other in Zahedan.
▪ For India, another harder and more pressing reality is that relations with Iran have a domestic political
dimension.
▪ As the largest Shia country and home to some of the holiest shrines of the Shia community, Iran remains
influential among India’s large Shia population, which can be an important swing vote in elections.

Political Relations

▪ India and Iran signed a friendship treaty on March 15, 1950.

▪ The high profile bilateral visits enhanced at the turn of the millennium with the visit of Prime Minister Shri Atal
Bihari Vajpayee to Tehran in April 2001 wherein the two countries signed the “Tehran Declaration” which set
forth the areas of possible cooperation between the two countries.
▪ President Mohammad Khatami visited India from January 24-28, 2003 as the Chief Guest at the Republic Day
parade.
▪ Both sides signed “The New Delhi Declaration” which set forth the vision of strategic partnership between India
and Iran.
▪ In 2016, during the visits of Prime Minister Narendra Modi, a Joint Statement titled “Civilizational Connect,
Contemporary context” was released.

71
▪ A Trilateral agreement on Transit and Transport was signed between India, Iran and Afghanistan in the
presence of Prime Minister Shri Narendra Modi, President Dr. Hassan Rouhani and Afghan President Ashraf
Ghani.
▪ In 2018, Dr. Hassan Rouhani, President of Iran visited India and a joint statement with the title “Towards
prosperity through greater connectivity” was issued.

Economic and Trade Relations

▪ India-Iran commercial ties were traditionally dominated by Indian import of Iranian crude oil. In 2018-19 India
imported US$ 12.11 bn worth of crude oil from Iran.
▪ However, following the end of the Significant Reduction Exemption
(SRE) period on 2 May 2019, India has suspended importing crude from
Iran.
▪ The bilateral trade during 2019-20 was $4.77 billion, a decrease of
71.99% as compared to the trade of $17.03 billion 2018-19. What is
significant is that Indian exports to Iran between 2011-12 and 2019-20
have grown by 45.60%.
▪ The Embassy of India has been at the forefront of promoting economic
and commercial relations between India and Iran.
▪ The Embassy of India organized three events titled ‘Potential for expanding India-Iran trade’ to promote
bilateral trade.

Major Export & Import b/w India and Iran

Import Inorganic/organic chemicals, fertilizers, cement clinkers, fruits and
from nuts, leather, etc.
Iran
Export Rice, tea, sugar, soya, medicines/pharmaceuticals, man-made staple
to Iran fibers, electrical machinery, etc.

▪ Considering the importance of India-Iran economic and commercial relations, two Indian banks, State Bank of
India and UCO Bank, have their representative offices in Iran.
Strait of Hormuz dilemma
Geo-economic significance of Iran

▪ The main contributory factor to Iran’s significance continues to

be its huge hydrocarbon resource, which contributes to 80 per
cent of its exports.
▪ Moreover, Iran’s energy resources have gained further
significance with the depletion of energy resources in other oil
producing states.
▪ From India’s point of view, Iran’s energy resources provide one
of the closest and cheapest energy resources available to fuel
India’s growth. ▪ One of the most significant capabilities
▪ Accordingly, India has been looking at the North South of Iran is its ability to disrupt maritime
Transport Corridor and Iran-Pakistan-India (IPI) gas pipeline to access to the Persian Gulf through the
resolve its energy shortages. narrow Strait of Hormuz.
▪ The IPI was proposed as a pipeline that would transport 36 ▪ The disruption of oil and gas production
billion cubic metres of gas every year from Bandar Abbas to or its transportation through the Strait of
Calcutta. Of this, 70 per cent gas was meant for India while 10 Hormuz, would lead to a big spurt in the
and 20 percent were meant for Iran and Pakistan respectively. prices of oil and gas, which, in all
▪ Despite huge oil reserves, Iran lacks adequate refining capacity probability, would create a major global
and as against an annual consumption of 64.5 million litres of economic crisis.
petrol, its refineries can refine only 43 million litres, which ▪ Even if the strait is not closed, any
forces it to import approximately one-third of its consumption. conflict in the region could increase the
global oil prices drastically

72
▪ Iran has been a major destination for the products of some Indian refineries in the private sector, which are unable
to market their products locally as the petroleum products are subsidised by the government.

Geo-political:
Iran is a major player in securing stability in the overall West Asian region, especially with respect to India to
maintain a balance between Shia-Sunni conflict and Arab-Israel conflict.
Securing sea lanes of communication (SLoC), combating piracy in the Indian Ocean region. India aspires to become
a net security provider in the Indian Ocean region where Iran is a major stake holder.

Connectivity

Chabahar Port

▪ The Chabahar port has been jointly financed by Iran and India. India alone plans to invest 20 Billion US
dollars towards development of Chabahar port.
▪ India is helping develop the Chabahar Port, which will give it access to the
oil and gas resources in Iran and the Central Asian states.
▪ By so doing, India hopes to compete with the Chinese, who are building
Gwadar Port, in Pakistan's Balochistan.
▪ Iran plans to use Chabahar for trans-shipment to Afghanistan and Central
Asia, while keeping the port of Bandar Abbas as a major hub mainly for
trade with Russia and Europe.
▪ India, Iran and Afghanistan have signed an agreement to give Indian goods,
heading for Central Asia and Afghanistan, preferential treatment and
tariff reductions at Chabahar.

Importance of Chabahar Project

▪ Bypassing Pakistan- India has strategically bypassed Pakistan to get connectivity with Afghanistan and enhance
trade and commerce between the three countries.
▪ Geostrategic location- This port is located very close (around 100kms) to Pakistan’s Gwadar Port, which has
been developed by China. Thus, the location is strategic to balance the increasing footprint of China in Asia
through the policy of ‘String of Pearls’.
▪ Connectivity with Europe and Central Asia- When linked to the International North-South Transport Corridor
(INSTC), it would connect South Asia and Europe & Central Asia, which would provide Indian business better
opportunities to expand in Central Asia
▪ Reducing transportation cost- The distance between India’s Kandla Port and Chabahar Port is quite short,
thereby reducing the transportation costs of the goods and freight time.

International North South Transport Corridor

▪ India, Iran and Russia had in September 2000 signed the INSTC agreement to build a corridor to provide the
shortest multi-model transportation route linking the Indian Ocean
and the Persian Gulf to the Caspian Sea via Iran and St
Petersburg.
▪ From St Petersburg, North Europe is within easy reach via the Russian
Federation.
▪ The estimated capacity of the corridor is 20-30 million tonnes of goods
per year.
▪ The route primarily involves moving freight from India, Iran,
Azerbaijan and Russia via ship, rail and road. The objective of the
corridor is to increase trade connectivity between major cities such as
Mumbai, Moscow, Tehran, Baku, Bandar Abbas, Astrakhan, Bandar
Anzali and etc.
▪ INSTC will not only help cut down on costs and time taken for transfer of goods from India to Russia and Europe
via Iran but also provide an alternative connectivity initiative to countries in the Eurasian region. It will be India’s
second corridor after the Chabahar Port to access resource rich Central Asia and its market.

73
Chabahar-Zahedan Railway

▪ A contract to develop a railway line (Chabahar-Zahedan) along the Iran-Afghanistan border was signed
in 2016.
▪ It is a 628 km Chabahar-Zahedan line, which will be extended to
Zaranj across the border in Afghanistan.
▪ The entire project would be completed by March 2022.
▪ It was meant to be part of India’s commitment to the trilateral agreement
between India, Iran and Afghanistan to build an alternate trade route to
Afghanistan and Central Asia.
▪ Despite several site visits by engineers, and preparations by Iranian
railways, India never began the work, ostensibly due to worries that these
could attract U.S. sanctions.
▪ The U.S. had provided a sanctions waiver for the Chabahar port and the
rail line to Zahedan, but it has been difficult to find equipment suppliers
and partners due to worries they could be targeted by the U.S.
▪ The Iranian government in July had decided to proceed with the
construction of this project on its own, citing delays from the Indian side in funding and starting the project.
▪ An Iranian diplomat in an interview has said that Tehran now hopes that New Delhi will help facilitate
equipment for the Chabahar-Zahedan railway line under a line of credit promised to it in 2018.

Farzad-B Gas Field

▪ Recently, the Ministry of External Affairs (MEA) has confirmed that India is no longer involved in the Farzad-B
gas field project of Iran.
▪ It is located in Persian Gulf (Iran).
▪ The contract for exploration of the field was signed in 2002 by Indian consortium comprising ONGC Videsh,
Indian Oil Corporation and Oil India.
▪ The contract expired in 2009 after declaration of commerciality of
the field, based on the gas discovery.
▪ Since then, the consortium has been trying to secure the contract
for development of the field.
▪ In January 2020, India was informed that in the immediate future,
Iran would develop the field on its own and would like to involve
India appropriately at a later stage.
▪ India needs gas and Iran remains one of the best options as
geographically, Iran is closest to India of all the countries in the
Persian Gulf region.
▪ Further, it could have improved India-Iran ties as the crude oil
import from Iran remains impacted due to the USA sanctions.

Strategic Relations

▪ Besides being a key source of crude oil for India, Iran is critical to India’s regional policy as it seeks to balance
against China’s growing influence in South Asia.
▪ Pakistan and China have been strategic partners for decades and the ongoing China-Pakistan Economic Corridor
has further cemented this strategic relationship.

Cultural Relations

▪ An Indian Cultural Centre in Tehran, which was inaugurated in May 3, 2013, was renamed as the Swami
Vivekananda Cultural Centre (SVCC) in 2018, and was provided a separate premises in 2019.
▪ The Centre organizes music/cultural/literary programmes/ seminars on cultural/literary issues related to India and
Iran on a regular basis.

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▪ The center conducts regular Yoga and Hindi classes.
▪ The International Day of Yoga was organized in 2018, 2019 and 2020.
▪ To commemorate the 150th Birth Anniversary of Mahatma Gandhi (from October 2018 to October 2019), a series
of events were organized.
▪ The 550th Birth Centenary of Sri Guru Nanak was also observed.

People to People Connections

▪ There is a high level commitment in both countries to promote and facilitate people to people contacts.
▪ Indian pilgrims visit the Sh'ia pilgrimage circuit in Iran (Qom, Mashhad, Hamedan) and Iraq (Najaf and Karbala)
every year. In 2020, more than 1100 Indian pilgrims visited Iran.
▪ These included more than 900 pilgrims from Ladakh, more than 100 from J&K, around 50 from Maharashtra and
the rest from UP, Delhi and other places.
▪ These pilgrimages are increasing progressively. 22. Annually, more than 20,000 Iranian tourists visit India, with
Delhi-Agra-Jaipur, Mumbai-Pune-Goa and Hyderabad being the most preferred destinations.
▪ A large number of Iranian students pursue higher studies in medicine, pharma, engineering, humanities and other
courses in India.

Humanitarian Assistance

▪ India has also helped Iran in times of natural disasters and health emergencies.
▪ India delivered aid that included PPE kits and PCR machines to Iran in April 2020 during the COVID-19 crisis.
▪ In 2019, India provided 103 tonnes of aid to Iran during the floods that ravaged the country.
▪ In June 2020, India supplied Malathion pesticide to Iran to fight the menace of desert locusts.

Counter Terrorism

▪ Globally, New Delhi and Tehran are on the same page in their opposition towards groups like al-Qaeda and the
Islamic State.
▪ Increasing hold of ISIS is a threat to Iran and with India effective efforts against terrorism India can be a attractive
partner.
▪ After the recent US-Taliban agreement, India needs Iran on its side as Taliban’s influence and the Pakistan
military’s influence is on the rise in Afghanistan.

Iran Nuclear Deal and its Complications

▪ Iran has taken further steps away from its crumbling nuclear deal with world powers by announcing it is doubling
the number of its advanced centrifuges, calling the move a direct result of the United States withdrawal from
the agreement last year.
▪ By doing so, Iran is trying to increase the pressure on Britain, France and Germany in particular to find some
arrangement that will allow them to sell the oil they were buying when Iran was not under sanctions.
▪ That requires some level of US support to waive sanctions against European firms by the United States.

Iran Nuclear Deal

▪ Iran agreed to rein in its nuclear programme in a 2015 deal struck with the US, UK, Russia, China, France and
Germany.
▪ Under the Joint Comprehensive Plan of Action (JCPoA) Tehran agreed to significantly cut its stores of
centrifuges, enriched uranium and heavy-water, all key components for nuclear weapons.
▪ The JCPOA established the Joint Commission, with the negotiating parties all represented, to monitor
implementation of the agreement.

Why Iran pulled out from the Deal?

75
▪ Trump and opponents to the deal say it is flawed because it gives Iran access to billions of dollars but does not
address Iran’s support for groups the U.S. considers terrorists, like Hamas and Hezbollah.
▪ They note it also doesn’t curb Iran’s development of ballistic missiles and that the deal phases out by
2030. They say Iran has lied about its nuclear program in the past.

Impact of escalated tension between Iran and the US

▪ Iran can make things difficult for the U.S. in Afghanistan as also in Iraq and Syria.
▪ The U.S.’s ability to work with Russia in Syria or with China regarding North Korea will also be impacted.
▪ And sooner or later, questions may be asked in Iran about why it should continue with other restrictions and
inspections that it accepted under the JCPOA, which would have far-reaching implications for the global nuclear
architecture.
▪ Coming after the rejection of the Trans-Pacific Partnership (TPP), the Paris climate change accord and the North
American Free Trade Agreement, President’s decision further diminishes U.S. credibility.

Implications for India

▪ Oil and Gas: The impact on world oil prices will be the immediately visible impact of the U.S. decision. Iran is
presently India’s third biggest supplier (after Iraq and Saudi Arabia), and any increase in prices will hit both
inflation levels as well as the Indian rupee. It would impact the development of Chahbahar port.
▪ INSTC: New U.S. sanctions will affect these plans, especially if any of the countries along the route or banking
and insurance companies dealing with the INSTC plan also decide to adhere to U.S. restrictions on trade with Iran.
▪ Shanghai Cooperation Organisation: China may consider inducting Iran into the SCO. If the proposal is
accepted by the SCO, which is led by China and Russia, India will become a member of a bloc that will be seen as
anti-American, and will run counter to some of the government’s other initiatives like the Indo-Pacific
quadrilateral with the U.S., Australia and Japan.
▪ Rules-based order: By walking out of the JCPOA, the U.S. government has overturned the precept that such
international agreements are made by “States” not just with prevailing governments or regimes.

Biden’s approach toward Iran

▪ It may be difficult for Mr. Biden to quickly reverse Mr. Trump’s adventurist policy towards Iran.
▪ It may not be possible for him given the domestic compulsions, to readopt JCPOA in its original form.
▪ But he will surely, if slowly, engage Tehran in talks and negotiations through Oman or some other
intermediary, to reduce tensions in the region.
▪ India may be able to buy Iranian oil, and sell our pharma and other goods to that country.
▪ The government may also feel less constrained in investing openly in oil and other infra projects in Iran, including
the rail project in which Indian Railways Construction Ltd has been interested.

Growing Iran-China relations

▪ In 2016, just as sanctions were eased, Chinese President Xi Jinping visited Tehran and proposed a long-term
comprehensive, strategic partnership.
▪ Iran kept the negotiations going for years because of reluctance to grow too close to China.
▪ Meanwhile, tensions in the region have been growing since last year with missile strikes in Saudi Arabia and a
U.S. drone strike killing Gen. Qassim Soleimani.
▪ As a veto-wielding member, China can help Iran at the UNSC.
▪ Even so, the Iran- China comprehensive, strategic partnership road map has run into opposition in the
Majlis[Iranian Parliament].

India’s concerns over Iran-China deal

▪ What is alarming for New Delhi is that Beijing is also concluding a security and military partnership with Tehran.
▪ Initial reports in Iran have suggested China will deploy 5,000 security personnel to protect its projects in Iran.

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▪ Some reports suggest Kish Island in the Persian Gulf, located at the mouth of the Strait of Hormuz, maybe “sold”
to China.
▪ With a growing Chinese presence, India is also concerned about its strategic stakes around the Chabahar port
project.

Challenges

▪ India-Iran oil equation: India has brought down the oil imports from Iran to zero due to the threat of US
sanctions under the Donald Trump administration.
▪ China factor: China has become Iran’s biggest economic partner, and Beijing’s influence is visible in its foreign
policy actions.
▪ The Chabahar problem: Plans to develop a railway link from the port till the Afghan border has not made any
progress, which has upset the Iranians.
▪ With a new set of stringent sanctions coming in and tensions raging between the US and Iran over the
assassination of Iran’s top military leader Qassem Soleimani, Indian firms are not willing to invest in the port.
▪ Involving China: Iran has not only suggested that China would be part of the Chabahar project but has also
dangled the possibility of Pakistan joining the project at some future date.
▪ India’s Middle East Policy shift: Earlier India’s Middle East policy has traditionally tried to balance the three
poles in the region: the Arab Gulf states, Israel and Iran. But now India is being seen as more friendly with the
Saudis, Israelis and Americans which is disliked by Iran. India has also grown increasingly close to Israel, a
country that is the source of vital military equipment for India, but which is also engaged in severe competition
with Iran.
▪ Instability in the gulf region: India’s immediate challenge in an event of escalation in the Gulf of Oman would
be international crude prices.
▪ India’s closeness with the USA: The United States itself is an increasingly vital partner for India. This is disliked
by Iran.
▪ Growing divergences on Afghanistan and regional security: Emboldened by their experience in Syria, Iran and
Russia are also working closely in Afghanistan to challenge the US and, this primarily means, supporting the
Taliban with greater vigour. Iran appears to be more closely aligned to Pakistan in Afghanistan than before, as
evidenced by Pakistan Prime Minister Imran Khan’s recent trip to Iran.
▪ Bilateral trade: Indian exports to Iran have steadily declined from $4.9 billion in 2013-14 to $2.379 billion in
2016-17, increasing the trade deficit.
▪ India’s renewed approach towards Israel has not been accepted well in Iran. Israel was strongly vocal against
nuclear deal with Iran. Israel also portray Iran as biggest security threat.
▪ Kashmir Issue- Iran’s supreme leader Ayatollah Khamenei equated the on-going Kashmir conflict with that of
Yemen and Bahrain has also created suspicion on India.

Significance of Indo-Iran relations

▪ Oil dependency: For India, oil imports are key to sustaining its economic growth trajectory as they are needed to
meet 80 percent of energy requirements. Iran is the third-largest source of oil for India after Saudi Arabia and Iraq.
▪ Access to Afghanistan and Central Asia: New Delhi also sees Iran as a conduit to Central Asia, a region that
India considers strategically vital. India has invested in Chabahar port in Iran and highways that provide an
alternative route to both Afghanistan and Central Asia, bypassing Pakistan.
▪ Containing Pakistan and Taliban: After the recent US-Taliban agreement, India needs Iran on its side as
Taliban’s influence and the Pakistan military’s influence is on the rise in Afghanistan.
▪ Tehran wants India to intervene with the US for more India-specific waivers on the energy front.
▪ Iran is also positioning to play the leadership role in the Islamic world, with Saudi Arabia and the UAE
perceived to be close to the US.
▪ Shia population: India has a Shia population second only to that of Iran. There are two Iranian consulates in India
in Hyderabad and Mumbai. Iran seeks a third one in Lucknow.

Way Forward

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▪ Though China has a greater capacity to resist U.S. sanctions, Iran realises the advantage of working with India as
it enjoys a sanctions waiver from the U.S. for Chabahar.
▪ Iran and India also share an antipathy to a Taliban takeover in Afghanistan.
▪ This is why Iran would like to keep the door open.
▪ Nevertheless, India needs to improve its implementation record of infrastructure projects in its neighbourhood.
▪ There are numerous tales of Indian cooperation projects in Nepal, Bangladesh, Sri Lanka, Myanmar, etc suffering
delays and cost overruns that only make it easier for China to expand its footprint in India’s neighbourhood.
▪ India should continue to remain politically engaged with Iran so that there is a better appreciation of each other’s
sensitivities and compulsions.
▪ India also needs to develop a comprehensive energy policy to arrest its west Asian energy dependence.
▪ As India has learnt the art of de-hyphenation, its time it brings a consistent and autonomous Iran policy.

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 CH-4 INDIA – WEST ASIA RELATIONSHIP
Basics and Background

▪ West Asia is the most volatile and conflict prone region in the world at present.
▪ The decline of the Ottoman power during the 19th and early 20th centuries led to an increase in the influence of
British, who considered it as the “western flank” in the defence of India.
▪ However, with the discovery of oil in Iran at the beginning of the 20th Century, followed by more substantial
finds around the Persian Gulf, the region became the focus of interest for the old as well as emerging great powers
India’s commercial and cultural relations with the region have ancient roots.
▪ After its independence, India under the policy of Non-Alignment extended a hand of friendship to the
countries of West Asia that were resisting the Cold War pressure to join rival military bloc.
▪ This led to close relations with Nasser’s Egypt and Baathist Iraq (after1968).
▪ Incidentally, Pakistan, along with Britain, Turkey, Iran and Iraq, became a member of the US supported Baghdad
Pact in 1955 (renamed as CENTO after Iraq withdrew following the Revolution of 1958).
▪ India’s consistent support to the Palestinian cause created a favourable image of the country among the Arab
States.
▪ This, coupled with the historical ties and the vigorous commercial links, has helped India build vibrant relations
with almost all the countries of the area.
▪ West Asia is important for India because of its geographical proximity and historical-cultural affinity, as well
as present day security concerns and economic interest.

India – Saudi Arabia

▪ Prime Minister presented a gold-plated replica of the Cheraman Juma Masjid to King Salman of Saudi Arabia.
▪ Prime Minister was conferred the Arabian country’s highest civilian honour — the King Abdulaziz Sash.

Importance of Saudi Arabia

▪ Saudi Arabia is India’s largest supplier of crude oil.

▪ India is the largest recipient of foreign remittances from the kingdom.
▪ Of the 11 million Indians working in West Asia, nearly three million are in Saudi Arabia. Therefore, stability in
the region, and particularly in Saudi Arabia, is high on India’s core agenda.
▪ In recent years, bilateral ties had acquired a security dimension with both countries stepping up cooperation
in counter-terrorism and intelligence-sharing.
▪ Riyadh also extradited several terror suspects to India.
▪ Saudi Arabia can force Pakistan to abandon its anti-India foreign policy.

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Importance of India for Saudi Arabia

▪ Economic Strain: Due to persistently weak oil prices. Also competition in oil market due to a sanctions-free Iran
entering the global economic mainstream. In this context, India is a vital market for Saudi Arabia.
▪ Change in US policy: The US is no longer as dependent on the region for energy as it used to be. Also, US is
more accommodative towards Iran to bring peace in west Asia.
▪ Friction with Pakistan: Islamabad renewing its ties with Tehran. Pakistan also refused to join Saudi Arabia’s war
coalition against the Iran-backed Shia rebels (Houthi) in Yemen.

Critical Issues

▪ Saudi – Pakistan relation: Pakistan is a “Historic Ally” of the Saudis.

▪ Saudi-Iran rivalry: destabilizing West Asia and influencing West Asian geopolitics.
▪ Ideological problem:
o While Saudi Arabia denounces all forms of terrorism, Saudi money is funding Wahhabi Islamic
groups around the world.
o Many extremist outfits are inspired by the Wahhabi branch of Islam.
▪ Saudi Arabia’s aggressive foreign policy in West Asia: foreign policy is doing great damage to regional
stability, which is India’s most important goal in the region.
o In Syria, the Saudi support for the rebels has played a key role in destabilising the regime, leading to the
rise of the Islamic State.
o In Yemen, the war has unleashed chaos and a humanitarian catastrophe, creating conditions for
radicalism to flourish.

INDIA - IRAN

The two sides signed a total of 12 of agreements on economy, trade, transportation, port development, culture, science
and academic cooperation.

Chabahar port agreement

▪ India and Iran signed the “historic” Chabahar port agreement, which has the potential of becoming India’s
gateway to Afghanistan, Central Asia and Europe.
▪ A contract for the development and operation for 10 years of two terminals and five berths;

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▪ The extension of credit lines of $500 million for the port and of Rs.3,000 crore for importing steel rails and
implementation of the port;
▪ Memorandums of understanding on provision of services by Indian Railways, including financing to the tune of
$1.6 billion, for the Chabahar-Zahedan railway line — a line that is also part of the trilateral agreement between
India, Iran and Afghanistan on a transit and trade corridor.
▪ India will invest billions of dollars in setting up industries — ranging from aluminium smelter to urea plants
in Iran’s Chabahar free trade zone after it signed a pact to operate a strategic port on the Persian Gulf nation’s
southern coast New Delhi and Tehran had agreed in 2003 to develop the port, near the Iran-Pakistan border. But
the project did not take off, mainly owing to international sanctions against Iran over its nuclear programme,
but also on account of inertia in Delhi.

Economic significance of Port

▪ Once the Chabahar port is developed, Indian ships will get direct access to the Iranian coast; a rail line to the
Afghan border town of Zaranj will allow India a route around Pakistan.

▪ The Zaranj-Delaram road constructed by India in 2009 can give access to Afghanistan’s Garland Highway,
setting up road access to four major cities in Afghanistan — Herat, Kandahar, Kabul and Mazar-e-Sharif. This
will surely boost trade with Iran and Afghanistan.
▪ Once the Chabahar port is developed, goods from India will not only travel up to Afghanistan, but beyond, along
the yet-to-be developed International North-South Transport Corridor (INSTC) to Central Asia.
▪ The road, rail and port development projects, once implemented, will change the way India, Afghanistan and Iran
do business.

International North South Transport Corridor (INSTC)

Multi modal transport corridor signed in 2000 in St. Petersburg with Iran, Russia and India as founding members.
It was expanded to include 11 new members: Azerbaijan, Armenia, Kazakhstan, Kyrgyzstan, Tajikistan, Turkey,
Ukraine, Belarus, Oman, Bulgaria.
It aims to link India and Iran via the sea route and then through Iran to the Caspian sea onwards to Central
Asia.

Strategic significance

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▪ Chabahar is situated just 100 km from Pakistan’s Gwadar port, the centrepiece of a $46 billion economic corridor
that China is building.
▪ The Chabahar port will act as a gateway for India to Central Asia bypassing the China-Pakistan arc.
▪ India’s presence in Chabahar will offset the Chinese presence in Pakistan port of Gwadar.

The trilateral trade treaty

▪ India, Afghanistan and Iran signed the trilateral trade treaty for developing the Chabahar port.
▪ The signing of the trilateral agreement between India, Iran and Afghanistan has been described as a “game
changer”. A trilateral transport corridor project has the potential to alter the geopolitical map of South and Central
Asia.

INDIA-UAE

▪ Prime Minister made his first visit to the Gulf region and West Asia with a trip to the United Arab Emirates
(UAE), marking the first visit by Indian PM to the UAE in more than three decades. In 2014-2015, trade
between India and the UAE crossed $59 billion with the balance of trade in favour of India, making the UAE
one of India’s biggest trading partners.
▪ India and UAE elevated the relationship between the two countries to a comprehensive strategic
partnership. That is being seen as a significant elevation of ties as well as a sign of India’s shift in the region.
▪ Both the countries agreed to “co-ordinate efforts to fight radicalisation and misuse of religion by groups and
countries for inciting hatred, perpetrating and justifying terrorism or pursuing political aims.” It is seen as a shift
in foreign policy where security and terrorism take precedence over diplomacy in driving India’s interests.
▪ The joint statement was also significant in the way it indicted Pakistan and state sponsored terror without
naming the country.
▪ The two countries would also work towards the adoption of India’s proposed Comprehensive Convention on
International Terrorism in the United Nations.
▪ In real terms, the strategic relationship will entail regular meeting (at least every six months) between national
security advisors of both countries, and improve points of contact between their security agencies to improve
operational cooperation.
▪ The UAE will also support India’s candidature for a permanent seat in the United Nation’s Security Council
(UNSC).

Transformational visit

▪ The Joint Statement between the United Arab Emirates and India is an important articulation of a significant shift
in the Arab world’s view of India.
▪ It talks of historic ties of “commerce, culture and kinship”, drawing attention to the unique history of Arab
interaction with Indian communities of the west coast, from Gujarat to Kerala.
▪ The joint statement, outlining closer government-to-government (G2G) relations, draws attention to the vibrant
business-to-business (B2B) and people-to-people (P2P) relationships and commits the UAE to a sharp increase
in its investment in India.
▪ The new strategic partnership outlined by the UAE and India is not just defined by India’s “Look West”
policy but that it is equally defined by the GCC’s “Look East” policy.

Importance of UAE:

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▪ UAE is geographically located at Strait of Hormuz. This is strategically important for India’s energy security.
▪ Over 3 million Indians live in UAE. This is the biggest Indian Diaspora anywhere in the world. They contribute to
Indian economy through large remittances.
▪ Safety of Indians is priority of Indian government for which it needs support of UAE government.
▪ UAE has one of the largest Sovereign Fund in the World. UAE wish to invest fund in India particularly in
National Infrastructure and Investment fund (NIIF). India needs fund for its infrastructure sector.
▪ India needs UAE to contain Terrorism and Radicalization. UAE is influential nation in Middle East and Muslim
World. Of the 24 extraditions from Middle East in last few years, 18 had been from UAE and Saudi Arabia.
▪ With US sanctions on Iran, India needs to import crude oil from other sources to meet its energy need. UAE and
Saudi Arabia have offered India with additional crude oil supplies to meet India’s growing needs.

INDIA-QATAR

▪ MoU between National Investment and Infrastructure Fund (NIIF) and Qatar Investment Authority (QIA).The
MoU aims at establishing framework for facilitating participation of Qatari institutional investors in Infrastructure
projects in India under NIIF
▪ Agreement on Cooperation and Mutual Assistance in Customs Matters.
▪ MoU between Financial Intelligence Unit – India (FIU-IND) and the Qatar Financial Information Unit (QFIU)
concerning cooperation in the exchange of intelligence related to money laundering, terrorism financing and
related crimes.
▪ MoU for Cooperation in Skill Development and Recognition of Qualifications.
▪ MoU on cooperation in Tourism.
▪ The First Executive Programme for MoU in the field of Youth and Sports.
▪ MOU for Cooperation in the field of Health.

Importance of Qatar:

▪ Qatar is an important trading partner for India in the Gulf region with bilateral trade in 2014-15 standing at $15.67
billion of which India’s exports accounted for nearly $1 billion.
▪ It is also one of India’s key sources of crude oil.
▪ India is the third largest export destination for Qatar after Japan and South Korea, with LNG being the major item
of trade.
▪ Indians comprise the single largest group of migrants in Qatar.
▪ The Prime Minister has been focusing on improving ties with the Gulf region which is crucial for India’s energy
security. He has already visited United Arab Emirates and Saudi Arabia. Qatar is member of Gulf cooperation
council (GCC).

First India Arab Ministerial Conference:

▪ The 1st Ministerial Meeting of Arab-India Cooperation Forum was held on 24 January 2016 in the Bahraini
capital Manama.
▪ From Indian side meeting was attended by Minister of External Affairs and Overseas Indian Affairs and foreign
ministers of Arab States also participated in this meet.
▪ In meeting, leaders reviewed the achievements of the Arab- Indian cooperation and adopted the Manama
Declaration.
▪ The Arab-Indian Co-operation Forum was launched in New Delhi in 2008.
▪ Regional Issues
o Arab Israel Conflict – A comprehensive and permanent solution to the Arab-Israeli conflict should be
achieved on the basis of UN Security Council resolutions, Madrid Peace conference of 1991 and the 2002
Arab Peace Initiative in Beirut.
o Syria Issue – There is need to preserve the unity, sovereignty, territorial integrity and stability of Syria and
the importance to reach a political solution to the crisis that preserves the lives of Syrians.
o Israel – Palestine Conflict - Israel should end its occupation of the Palestinian “Arab” territories it seized in
1967 and dismantle all the settlements.
▪ Global Issues

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 o UNSC Reforms – There is a need for urgent reform of the United Nations Security Council through
expansion in both permanent and non-permanent membership to reflect contemporary reality.
o Terrorism – They emphasized the need for concerted regional and international efforts to combat terrorism
and to develop a strategy to eliminate the sources of terrorism and extremism including its funding, and
combating organized cross-border crime.

India’s West Asia Policy:

▪ For decades, India was a passive player in West Asia-a beneficiary of good relationships with multiple actors.
Historically, India’s West Asia policy has been multi-directional.
▪ During the Cold War years, India maintained close economic cooperation with both Saudi Arabia and Iran,
the rival poles in regional geopolitics.
▪ In the post-Soviet world: The bi-directional approach has been expanded to a tri-directional foreign policy to
accommodate the three key pillars of West Asia — Saudi Arabia, Iran and Israel.

Look West Policy

▪ Look West Policy is the overall Indian government’s strategy in dealing with the West Asian nations.
▪ It was adopted by the Indian government in 2005 and has not gained much attention since then.
▪ In recent years, under the present government, the same strategy has been followed with increased intensification.
▪ Currently, the Look West Policy focuses on three main axes:
1. The Arab Gulf countries
2. Israel
3. Iran

Importance of West Asia for India

Energy Security:
▪ 70 per cent of India’s imported energy needs come from West Asia and this dependence will only increase as the
Indian economy continues to grow at 8 per cent or more.
▪ Uninterrupted supply of oil at reasonable prices is vital for India’s economic health in view of its heavy
dependence on imports from the region.
▪ Any conflict in the region, such as the Arab-Israeli war, Iran-Iraq war and Kuwait crisis, is likely to contribute to
the disruption of oil supply and/or price hike, imposing additional burden on the Indian economy.
▪ Also, the choking of Strait of Hormuz would lead to a super spike in prices globally. And the supply cut as
decided by Organisation of the Petroleum Exporting Countries plus (OPEC+) countries will lead to further
escalation in prices.
Remittances
▪ There are more than 3.5 million Indian migrant workers in the Gulf region.
▪ Their annual remittance is to the tune of a few billion dollars and is among the highest foreign exchange earners
for the country.
▪ Their wellbeing is a major concern for India. Any tension in the region, or in India’s relations with these countries,
may have negative consequences for these migrant workers and also for the Indian economy.

Religious Extremism:
▪ The ascendancy of conservative religious elements in the region is a cause for grave concern to India in view of its
large indigenous Muslim population and the militancy in Kashmir.
▪ Pakistan, under the slogan of Pan-Islamism, tries to exploit the situation. It is evidenced by the growing sympathy
shown by the Organisation of Islamic Conference (OIC) with Pakistan’s stand on Kashmir issue.

Geostrategic Interest:
▪ India has substantial trade with West Asia. The liberalisation of the Indian economy has given further boost to
these commercial links.
▪ The region accounts for more than 20 per cent of our imports, mainly hydrocarbons, and 10 per cent of our
exports, which include wheat, non-basmati rice, textiles, and engineering and manufactured goods.

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▪ The Indian construction companies have got some contracts in the region and there are ample opportunities in
view of the reconstruction work in Iraq.
▪ The 8 Persian Gulf and Suez Canal are the main waterways through which bulk of India’s trade is carried out.
Hence, the safety of these routes is vital for the country.
▪ In the age of air travel and transport, West Asia has become an integral link in India’s westbound air service.
▪ Iran is emerging as an important transit route in our interaction with Central Asia, as we have already discussed.
▪ To reduce the influence of China in west Asia and in Arabian Sea. China is continuously making in road to west
Asia through OBOR initiative

Significance
▪ India is in the good position of being trusted by all the major factions in the Middle East; it has good relations with
Iran, Saudi Arabia, Israel, Iraq, and the Gulf States.
▪ The numbers on trade between India and the Gulf countries are impressive.
▪ There are large Indian communities in the Gulf States.
▪ The remittances sent by Indian labour migrants have added to the economic relationship.
▪ West Asia is crucial for stability and economic growth in India because around 65% of our oil and more than 80%
of our gas supplies come from this region.

Change in West Asian strategic thinking:

▪ The structural change in the global energy market with West Asian oil and gas increasingly heading to South
and East Asian markets rather than to the Trans-Atlantic markets.
▪ Partly as a consequence of this change in flows and partly owing to the fiscal stress faced by the trans-Atlantic
economies, West Asia is looking to India and other Asian powers to step in and offer security guarantees to
the region. Many GCC states have welcomed defence cooperation agreements with India.
▪ In the wake of the Arab Spring and the mess in Egypt and Iraq, the Gulf states find India and China to be more
reliable interlocutors than many western states.
▪ Under pressure from radical and extremist political forces within West Asia, most states in the region have come
to value the Indian principle of seeking and securing regional stability as an over-riding principle of regional
security.

Challenges:

▪ ASEAN has been the vehicle for India’s expanding partnership with South East Asia, but there is no similar
forum in the Middle East.
▪ The internal security situation in Syria, Iraq and Yemen has gone from bad to worse. The regional powers
continue to fight proxy wars on sectarian lines, pumping huge amount of money and weapons to bolster their
favoured groups.
▪ The involvement of extra-regional players such as the USA and Russia in the internal conflicts in West Asia has
further aggravated the situation.
▪ The GCC-Iran rivalry, Shia-Sunni conflict, external intervention in the region, the fear of rise of religious
radicalism etc have further contributed to instability in West Asia .
▪ Terrorism has emerged as the biggest security threat to the region. The rise of the Islamic State in Iraq and Syria
(ISIS) is the most disturbing trend.
▪ Saudi-Iran rivalry destabilizing West Asia and influencing West Asian geopolitics.
▪ Pakistan factor is another bone of contention as Pakistan is a very close ally of many west Asian countries
especially with GCC.
▪ Shia- Sunni divide may impact internal security of India.
▪ India’s close relation with the Israel is another sore point with West Asia.

Options Before India:

▪ Mediating Role: India has a very strong case to appeal for de-escalation as it had equity on both sides of the Gulf
(with a trade of over $200 billion) and large diaspora in Iran. Hence, India should play a proactive role in
mediation for long-term gains. However, India talked to both sides but is avoiding playing the role of a mediator.
▪ Substitutes for Oil: India should be relooking at options for oil supply in the worst-case scenario of disruption in
oil supplies. Other countries are going to support India’s oil supply but overall global oil prices are going to rise.

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 Africa has although offered the same. Also, in cases of emergency, buffering for oil and natural gas needs to
be maintained.
▪ Evacuation: In case of a war, preparation for evacuation of our large diaspora should be done.
▪ Foreign Reserve: Foreign reserves of India needs to be enhanced to cope up with the situation of emergency. In
this regard, agreeing with Japan to access its reserves in the form of currency swap agreement can be crucial.

Duqm Port

▪ Recently, India got access to strategic Oman port Duqm for military use.
▪ It is situated on the southeastern seaboard of Oman, overlooking the Arabian Sea and the Indian Ocean.
▪ It is strategically located, in close proximity to the Chabahar port in Iran.
▪ This is part of India’s maritime strategy to counter Chinese influence and activities in the region.
▪ With the Assumption Island being developed in Seychelles and Agalega in Mauritius, Duqm fits into India’s
proactive maritime security roadmap.

Way Forward
▪ De-escalation: This would require firm political will at the highest level from every directly or indirectly involved
stakeholder (like US, Iran, Russia, etc). After the sanctions, Iranians have become hostile towards the US because
of the economic hardships they have to face.
▪ Afghan Peace: India needs to increase its engagement with Afghanistan in order to contain the increasing role
of Pakistan in Afghanistan.
▪ Role of Iraq: The Government of Iraq needs to restrict the presence of American forces within their State and
take strict action against US forces stationed in Iraq.
▪ India’s Role: Diplomatically, India has a longstanding relationship with both Iran and the US. Therefore, can
play a key role in de-escalating the situation.

Slowdown in West Asia:

Gulf countries are going through a turbulent phase due to oil price downward moment since last two years. This has
reduced exports, imports and a slowdown in Remittances, though trade deficit has reduced because imports are more
than exports to this region.

Reasons for declining oil prices:

Fall in oil prices:

The oil prices were as high as $115 per barrel in June 2014 and thereafter it took nosedive to reach at $35 per barrel in
February 2016. This fall in oil prices can be attributed to three main reasons:

Less demand in USA:

United States domestic production has nearly doubled over the last several years due to shale gas revolution, pushing
out oil imports that need to look another home. Saudi, Nigerian and Algerian oils that once sold in the United States
are suddenly competing for Asian markets, and the producers are forced to drop prices.

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Less demand in Europe:

The economies of Europe and developing countries are weak and vehicles are becoming more energy-efficient. On the
other hand most of the western world is going through slowdown so demand has reduced in general from western
world.

Overproduction:

Gulf countries are overproducing to catch the new markets as USA has become self-sufficient. Also Iran’s entry into
the market due to signing of JCPOA with P5+1 countries flooded the market with excessive oil. To keep Iran out of
race OPEC countries kept on increasing oil production.
Canadian and Iraqi oil production and exports are rising year after year.
Even the Russians, with all their economic problems in recent years, have managed to pump at record levels.

Impact on Gulf region:

▪ All GCC countries are facing public spending cuts, tightening liquidity and widespread investor uncertainty.
Nearly two years after the start of the collapse in global energy prices, the economic outlook for the six economies
of the Gulf Cooperation Council (GCC) has clearly deteriorated.
▪ Corporate sectors across the region are facing a much more challenging environment, amid waning fiscal support
to the economy; rising financing costs due to tightening liquidity conditions; higher fuel and utility costs; and the
new strains on consumers’ purchasing power.
▪ In United Arab Emirates’ economic position following the global downturn in commodity prices, as well as the
wider effects the slowdown has on a range of real estate sectors, from private property sales to commercial
buildings in Dubai.

Impact on India:

Exports:
Saudi Arabia and UAE are among top ten export destination for India. In 2015 the combined share of export to both these
countries was 14% of total exports, totalling for $37 billion dollars. Export products include Rice, Processed Meat, Motor
Vehicles, Jewellery, Precious Metals, Petroleum products and Machinery. These sectors get hit due to reduced demand.

Imports:
Saudi Arabia and UAE are among top ten import partners. The total imports constitute 11% of total imports and cost $42 billion
Dollars. The imports are dominated by Crude oil and related product. The downward spiral in international crude oil prices
resulted in a decline in oil import bill by around 18 per cent which together with a sharp decline in gold imports led to a reduction
in India’s overall imports.

Employment:
More than seven million Indians currently live and work in the oil-rich Gulf nations. The vast majority of them are in Saudi
Arabia, UAE and Kuwait while the others are spread across Oman, Bahrain, and Qatar. A loss in jobs due to slowdown makes
Indians abroad unemployed. This pushes them to India again worsening unemployment situation in India.

NRI Deposits:
Deposits from non-resident Indians, an important source of US dollar funding for the Indian economy, is collapsing. It fell 60% in
the April-July 2016 period to just about $2.8 billion as the layoffs in the Gulf region mounts amid sluggish oil prices. United Arab
Emirates (UAE), Saudi Arabia, Qatar and other countries in the Gulf region cut spending on construction projects and sent the
Indian workers back home to control budget deficits caused by falling oil prices.

Remittances:
Subdued income conditions in source countries, particularly in the gulf region due to downward spiral in oil prices continued to
weigh down on remittances by Indians employed overseas as private transfers moderated to US$ 28.2 billion in H1 of 2016-17
from US$ 32.7 billion in H1 of 2015-16.

87
 CH-5 INDIA – UAE BILATERAL RELATIONSHIP

Basics and Background

▪ India and the United Arab Emirates (UAE) established diplomatic relations in 1972. UAE opened its Embassy in
Delhi in 1972 & India opened its Embassy in Abu Dhabi in 1973.
▪ India and United Arab Emirates (UAE) enjoy strong bonds of friendship based on age-old cultural, religious and
economic ties between the two nations.
▪ Recently, India held a joint commission meeting with UAE on trade, discussed regional, international
developments.
▪ The Indian side invited further investments from the UAE in key sectors of the Indian economy, such as
infrastructure, including logistics, food parks, highways, ports, airports, renewable energy and defence.
▪ Moreover, India has welcomed full normalization of ties between the UAE and Israel through the Abraham
Accord last month.

Political Relations

▪ The traditionally strong bilateral relations enjoyed by India & UAE received impetus with the visit of PM Modi to
UAE on 16-17 August 2015 that marked the beginning of a new strategic partnership between the two countries.
▪ Sheikh Mohamed bin Zayed Al Nahyan, (MBZ) Crown Prince of Abu Dhabi and Deputy Supreme Commander of
UAE Armed Forces, visited India in from February 2016.
▪ MBZ visited India again in January, 2017 as the Chief Guest at India’s Republic day celebrations. It was during
this visit that the bilateral relations were upgraded to a ‘Comprehensive Strategic Partnership’.
▪ PM visited UAE again in August 2019 to receive the UAE's highest civilian award, 'the Order of Zayed’ that
was conferred on him by the UAE President in April 2019.
▪ The visit also witnessed the official launch of the ‘RuPay Card’ in UAE, and the release of a set of stamps issued
by Emirates Post commemorating the 150th Birth Anniversary of Mahatma Gandhi jointly by PM Modi and
MBZ.

Bilateral Relations

▪ Around 2.8 million Indians are living harmoniously in the UAE.

▪ As India seeks to enhance economic engagement and deepen security cooperation with the Gulf, it finds a willing
partner in the UAE.
▪ As UAE ‘Look East’ to find partners for its economic growth and with security concerns emanating from turmoil
in West Asia and growing threat from terrorism, it finds a natural partner in India.
▪ UAE has a special place due to its business-friendly atmosphere, willingness to invest in the Indian economy and
its important role in maintaining peace and stability in the region.

Economic Relations

88
▪ India and UAE have shared trade links through the centuries. Trade, which was dominated by traditional items
such as dates, pearl and fishes, underwent a sharp change after the discovery of oil in UAE (oil exports began
from Abu Dhabi in 1962).
▪ The real impetus, however, started after Dubai positioned itself as a regional trading hub by the early 1990s and
about the same time, the economic liberalization process started in India.
▪ Growing India-UAE economic and commercial relations contribute to the stability and strength of a rapidly
diversifying and deepening bilateral relationship between the two countries.
▪ India-UAE trade, valued at US$ 180 million per annum in the 1970s, is today around US$ 60 billion, making
UAE, India's third largest trading partner for the year 2018-19.
▪ Moreover, UAE is the second largest export destination of India (after US) with an amount of over US$ 30 billion
for the year 2018-19. For UAE, India was the second largest trading partner during 2018 with US$ 36 billion
(non-oil trade).
▪ UAE’s investment in India is estimated to be around US$13-14 billion; it is the 10th biggest FDI investor for
India.

Service Sector
Construction (15.78%)
Development (-
7.08%)

Infrastructure Sea Transport

(-7.15%) (8.80%)

Power (8.34%)

▪ Indian investments in the UAE are estimated at around US $ 85 billion. There are 4365 Indian companies, 238
commercial agencies and 4862 trademarks registered in the UAE, and the inward Indian FDI stock into the UAE
amounted to $6.2 billion at the end of 2017, as per UAE Ministry of Economy data.
▪ Most Indian companies have invested in real estate, manufacturing, wholesale and retail trade, transportation,
logistics, construction, financial and insurance activities.
▪ The annual remittances made by the large Indian community in UAE (estimated to be around 3.3 million)
amount to over US$ 17.56 billion (Year 2018, source: UAE Central Bank).

Major Export & Import b/w India and UAE

Import Petroleum and petroleum products; precious metals, stones, gems
from & jewellery; minerals; chemicals; wood & wood products.
UAE
Export Petroleum products; precious metals, stones, gems and jewellery;
to minerals; food items (cereals, sugar, fruits & vegetables, tea, meat,
UAE and seafood); textiles (garments, apparel, synthetic fibre, cotton,
yarn); engineering & machinery products and chemicals
World Government Summit
• It is an annual event held in Dubai that brings together leaders in government for a global dialogue about governmental process and
policies with a focus on the issues of futurism, technology and innovation, as well as other topics. It was formed in 2013 by a team of
experts with the goal of improving the lives of the seven billion people. In 2018 Summit Indian Prime Minister was Guest of Honour.

India-UAE Partnership Summit (IUPS) is an event specifically designed for promotion of investments from UAE to
India and India to UAE.

89
Defence Cooperation

▪ Bilateral Defence Interaction between India and UAE has been steadily growing in accordance with other aspects
of the bilateral relationship. The ships of the Navies of both countries have regularly made port calls enhancing
bilateral defence co-operation.
▪ With the spread of radicalism in Gulf and South Asia, India looks to enhance security cooperation with UAE to
counter terrorist threats and combat radicalization.
▪ ‘Desert Eagle II’, a ten day air combat exercise, was held in May-June 2016 between the air forces of India and
UAE.
▪ In the recent years, IAF participated in a bilateral exercise with the UAE counterparts in May 2016 & UAE Air
Force Officers participated as Observers in Trilateral Air Exercise on Humanitarian Assistance & Disaster Relief
(HADR) theme held in March 2018.
▪ Two Indian Navy Ships participated in the maiden IN-UAEN Bilateral Exercise in March 2018 named Gulf Star
1; and Indian Navy and Coast Guard have made a number of port calls to Abu Dhabi and Dubai, along with the
associated PASSEX. IN Ships have been regularly participating in IDEX/NAVDEX held in Abu Dhabi biennially.

Combating Extremism and Terrorism

▪ India and UAE see each other as important players in maintaining peace and stability in their respective regions
and have reinforced their partnership in countering terrorism, combating radicalization and preventing terror
finance through intelligence sharing and close contacts between their National Security Councils.
▪ The growing strategic partnership between New Delhi and Abu Dhabi can be seen in their approach towards
fighting terrorism and extremism.
▪ The most significant support from the UAE came to India after the Uri attack when Abu Dhabi sent out a very
clear public statement suggesting India to take decisive action against perpetrators of the attack.
▪ Even on Pathankot attack, the UAE supported India.

Energy Security

▪ With respect to oil trade, UAE is the 5th largest import source and accounts for about 6% of our total crude imports.
▪ There is an intention for the Abu Dhabi National Oil Company (ADNOC) and the Indian Strategic Petroleum
Reserves Ltd. (ISPRL) to sign a Memorandum of Understanding on the Establishment of a Strategic Petroleum
Reserve in India, and has agreed to conclude negotiations in the near future.

Cultural Relations

▪ UAE has over 3.3 million Indians and Emiratis are quite familiar and receptive to Indian culture.
▪ The importance given to Indian culture by the UAE was further highlighted in April, 2019 when India participated
as the Guest of Honour Country in Abu Dhabi International Book Fair 2019.
▪ Indian cinema/ TV / radio channels are easily available and have good viewership; major theatres/cinema halls in
the UAE screen commercial Hindi, Malayalam and Tamil films.
▪ The Emirati community also participate in our annual International Day of Yoga events and various schools of
yoga & meditation centres are running successfully in the UAE.
▪ Some of the following events reflects the enhanced cultural cooperation
between India and the UAE:
1. Soft launch of Gandhi Zayed Digital Museum was done in Abu Dhabi
by the then EAM and the Foreign Minister of the UAE on 04
December, 2019.
2. The foundation stone for the first Hindu temple in Abu Dhabi was laid
on 20 April 2019 and the ceremony was attended by H.E. Dr. Thani bin
Ahmed Al Zeyoudi, the Minister of Climate Change & Environment of the UAE along with other
representatives of the Government of the UAE and the Ambassador.

Education

90
▪ Indian schools: There are 130 Indian schools in the UAE following the CBSE and Kerala Board curricula with
approx 219,000 students, mostly children of Indian expatriates.
▪ Conduct of Examinations: The Mission & CGI Dubai assist in organizing the Annual and Supplementary
Examinations of the Grade 10 & 12 of CBSE & Kerala Boards. Apart from the CBSE and Kerala Board, we also
co-ordinate examinations twice a year for Indira Gandhi National Open University, National Institute of Open
Studies and Institute of Chartered Accountants.
▪ Issue of Equivalency: The Mission issues Genuineness Certificates after obtaining verification from the
concerned University / Technical board in India to expatriate Indians to facilitate grant of Equivalency Certificate
for their Indian educational degrees/certificates by the UAE Ministry of Education. The Equivalency Certificate
has now become mandatory to continue / obtain employment in the UAE.

Indian Diaspora

▪ Indian expatriate community of approx. 3.3 millions is the

largest ethnic community in UAE constituting roughly about 30
per cent of the country’s population.
▪ Among the Indian States, Kerala is the most represented
followed by Tamil Nadu and Andhra Pradesh. However, Indians
from the Northern States, all put together, also form a significant
portion of the UAEIndian population.
▪ The profile of the community has changed from the 1970s and
1980s, when majority of the Indian community was blue-
collared to the extent of 85% -90%.
▪ Currently, around 35% of the Indian community is made up of professionally qualified personnel, businessmen &
other white collar non-professionals.
▪ The Indian community has played a major role in the economic development of the UAE and is respected for its
technical competence, sense of discipline & law abiding nature.
▪ The annual remittances made by the large Indian community in UAE amount to over US$ 17.56 billion (Year
2018)

Significance of India UAE Relationship

▪ UAE is geographically located at Strait of Hormuz. This is world’s most important oil artery and strategically
important for India’s energy security.
▪ Over 3 million Indians live in UAE. This is the biggest Indian Diaspora anywhere in the world. They contribute to
Indian economy through large remittances.
▪ Safety of Indians is priority of Indian government for which it needs support of UAE government.
▪ UAE has one of the largest Sovereign Fund in the World. UAE wish to invest fund in India particularly in
National Infrastructure and Investment fund (NIIF). India needs fund for its infrastructure sector.
▪ India needs UAE to contain Terrorism and Radicalization. UAE is influential nation in Middle East and Muslim
World. Of the 24 extraditions from Middle East in last few years, 18 had been from UAE and Saudi Arabia.
▪ With US sanctions on Iran, India needs to import crude oil from other sources to meet its energy need. UAE and
Saudi Arabia have offered India with additional crude oil supplies to meet India’s growing needs.

Recent Development

▪ Recently, the eighth meeting of the India-UAE High-Level Joint Task Force on Investments has been virtually
hosted by India in the wake of the ongoing Covid 19 pandemic.
▪ The meeting was co-chaired by Shri Piyush Goyal, Minister of Railways, Commerce & Industry and Consumer
Affairs and Public Distribution, Government of India and His Highness Sheikh Hamed bin Zayed Al Nahyan,
Member of the Executive Council of the Emirate of Abu Dhabi, and Senior officials from both countries
participated in the meeting.

91
▪ The two sides agreed that the recent challenging circumstances
of COVID-19 made it even more important to encourage Joint Task Force
investment and cooperation in areas of mutual interest with the
▪ The Joint Task Force was created in
purpose to stimulate economic activity. 2012 as a crucial forum for
▪ At the meeting, both sides reviewed the existing UAE Plus and further deepening the economic
the Fast Track Mechanism created in 2018. ties between the UAE and India.
▪ UAE Plus is a special and dedicated desk constituted ▪ The mechanism has assumed greater
under Invest India with Arabic speaking officials to help importance as the two countries signed
facilitate investments the Comprehensive Strategic
▪ The Fast Track Mechanism aims to resolve any challenges
Partnership (CSP) Agreement in Jan
experienced by UAE investors in India. uary 2017 and the Joint Task Force is
an integral component of it.
Challenges ▪ The focus areas underlined in the CSP
were economy with emphasis on
▪ As far as investments are concerned, the systemic problem faced a two-way flow of investments,
due to slow implementation from Indian side is a major counter-terror cooperation and
obstacle. defence ties.
▪ While India needs to step up its efforts to tie the loose ends in ▪ India has signed CSPs with the UK,
the implementation of projects and investments funds, it also Indonesia, Vietnam and Australia.
needs to ensure the execution of the investment projects with
required expertise.
▪ Indian companies operating in the UAE also face problems due to lack of clarity in many aspects of commercial
regulations, labor laws and lack of transparency on part of Emirati businesses.
▪ While trade and energy are two of the most significant aspects of Indo-UAE bilateral ties, the bilateral trade has
come down significantly in the past four years.
▪ There is also a need to smoothen problems faced by Indian migrants due to cumbersome and strict regulations that
favour the Emirati employers and at times leads to serious problems for Indian workers, especially unskilled
workers.
▪ It has also been noticed that workers from other nationalities including Filipinos and Bangladeshis are replacing
Indian workers and it is reflected in slight drop in remittances inflow from UAE to India in recent years.

Way Forward

▪ There are untapped potentials as far as Indian health industry and medical sector is concerned. India is home to
one of the finest human resources as far as the medical profession is concerned and its private hospitals have the
necessary infrastructure, facilities and expertise to provide world class medical care within a fraction of the cost
spent in developed countries.
▪ There are further untapped potentials in the arena of renewable energy. The cost for production and transmission
of solar energy in the UAE are a fraction to that of India and this is a priority area for the UAE government.
▪ India has a huge market and there is a significant scope for growth in automobile industry, services sector,
agriculture and allied industries.
▪ There is also significant potential in the education and training sector. India has some of the finest higher
education institutions in engineering and management fields and given their cost-effective and world-class
education, they can be a major attraction for Gulf and Emirati students who are looking for acquiring higher
education and better skills.
▪ In defense sector, there is a need to further enhance cooperation through joint training programs for Indian and
UAE officers. India can also increase the number of Emirati officers who can avail training in its defense schools.

92
 CH-6 INDIA – SAUDI ARABIA BILATERAL RELATIONSHIP
Basics and Background

▪ India and Saudi Arabia have traditionally enjoyed close and friendly relations.
▪ The number of high-level visits by political leaders from both countries manifests the strategic importance
accorded by both countries to one another.
▪ India’s support for the Soviet Union’s 1979 invasion of Afghanistan and Saudi Arabia’s frequent
expressions of solidarity with Pakistan engendered hostilities between India and Saudi Arabia during the Cold
War,
▪ 2006 was a significant year for India — Saudi ties, with the landmark visit of late King Abdullah as the state
guest for the country’s Republic Day celebrations and the subsequent signing of the ‘Delhi Declaration’, laying
down the foundations for a review on how the Saudis had approached India in the past.
▪ This was built upon significantly during the 2010 visit of Prime Minister Manmohan Singh to Riyadh, where
the partnership was christened as a ‘strategic’ one with the signing of the reciprocal ‘Riyadh Declaration’ giving
precedence to the defence and security realms, going well beyond the status-quo of oil and the 3.2 million strong
Indian expatriate population in the country.
▪ Indian Prime Minister Narendra Modi’s two trips have resulted in the expansion of Saudi Arabia’s oil exports
to India, and an increase in the number of Indian guest workers finding employment in Saudi Arabia.

Commercial Ties

▪ Saudi Arabia is India’s fourth largest trade partner (after China, USA and Japan) and a major source of energy
as India imports around 18% of its crude oil requirement from the Kingdom.
▪ Saudi Arabia is also a major source of LPG for India. In 2018-19 (as per DGFT), India-Saudi bilateral trade has
increased by 23.83 % to US $ 34.03 billion.
▪ According to Saudi Arabian General Investment Authority (SAGIA), there are 322 Indian companies
registered as joint ventures/100% owned entities worth US$ 1.4 billion in the Kingdom as of December 2017.
▪ Major Indian companies and corporate groups such as L&T, TATAs, Wipro, TCS, TCIL, Shapoorji &
Pallonji, etc. have established a strong presence in Saudi Arabia.
▪ Saudi Petrochemical Giant SABIC set up its R&D Centre in Bangalore with an investment of over US$ 100
million in November 2013.
▪ Saudi Company Al- Fanar is currently executing a 300 MW power project in Kutchh. Saudi Aramco signed a
MoU with the Mumbai based GumPro to set up a drilling fluids facility in 2018.
▪ The Saudi Arabian oil major Aramco and a partner UAE company had decided to invest half in a planned $ 44 billion in a
refinery-cum-petrochemical project in Maharashtra billed as the world’s biggest.
▪ FUTURE INVESTMENT INITIATIVE(DAVOS IN THE DESERT): FII forum is an initiative of Saudi Crown
Prince who plans to diversify the Kingdom's economy while reducing its economic dependence on petroleum
products under his ambitious vision 2030 plan. In 2019 Summit, Indian Prime Minister attended the forum and
delivered the keynote address “What’s next for India?” at FII.

93
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Strategic Ties

▪ The Riyadh Declaration of 2010 had forged a Strategic Partnership between India and Saudi Arabia.
▪ Saudi Arabia has identified India as one of the 8 strategic partners under “Vision 2030”.
▪ It intends to deepen partnership in areas of political engagement, security, trade and investment, and culture.
▪ As part of this engagement, the two sides are finalising the setting up of a Strategic Partnership Council at the
Ministerial level.
▪ National security advisor Ajit Doval’s Saudi visited Saudi Arabia recently intensify security engagements as both
sides remain concerned by the ongoing security situation in their respective regions.
▪ During the visit of Crown Prince Mohammed bin Salman to India, “Comprehensive Security Dialogue” at the
national security adviser (NSA) level and a Joint Working Group on Counter-Terrorism was constituted.
▪ The two sides agreed to cooperate in producing “spare parts for naval and land systems.
▪ Saudi Arabia promised to share more intelligence to boost counterterrorism cooperation with India
▪ Enhancement of joint military training programs and exercises was agreed in the MoU signed in February
2014.
▪ The recent joint press statement by the two nations made an important assertion that "reiterated categorical
rejection of all forms of interference in the internal affairs of countries”. It is a kind of snub to Pakistan which is
interfering India’s Article 370 issue.

Delhi Declaration & Riyadh Declaration

▪ In Delhi Declaration (2006), the two sides had agreed to ensure "reliable, stable and increased" volume of crude
oil supplies through "evergreen" long-term contracts.
▪ Riyadh Declaration was signed in 2010 to establish a strategic partnership between two nations.

Security

▪ Riyadh has largely shown an understanding of India’s terrorism-related concerns, and has agreed to work with
India in countering the global menace.
▪ During Indian PM's 2016 visit, an MoU on cooperation in the exchange of intelligence related to money
laundering and terrorism financing was also signed.
▪ In recent Saudi Arabia has deported few terrorists linked to LeT and those trying to join ISIS.

Defence

▪ An MoU on Defence Cooperation was signed in 2014 during the visit of the Crown Prince.
▪ The two sides are exploring the possibility of elevating this engagement with Joint Production and Joint Exercises,
particularly in Joint Naval exercises.
▪ Saudi Arabia is part of the the ‘Indian Ocean Naval Symposium’ (IONS).

Energy

▪ Saudi Arabia is a source of 17% or more of crude oil and 32% of LPG requirements of India and thus a key
pillar of India’s energy security.
▪ Recently, Saudi ARAMCO, in partnership with ADNOC of UAE, has agreed to partner in Ratnagiri
(Maharashtra) Refinery and Petro-Chemical project Ltd., a Joint Venture worth US$ 44 billion.
▪ India hopes to transform this buyer-seller relationship in energy to a broad-based partnership.

Diaspora:

Saudi Arabia has the largest Indian diaspora which helps India through remittances. But these people face various issues like
confiscation of their passports, poor working conditions, summary termination of contracts, discrimination on the basis of
nationality.

94
Example: Saudization, officially known as Saudi Nationalisation Scheme or Nitaqat is the policy of Saudi Arabia whereby Saudi
companies and enterprises are required to fill up their workforce with Saudi nationals up to a certain level.

Other Range of Cooperation

▪ Other areas of interest for joint collaboration are fertilisers, food security, infrastructure, renewable energy,
etc.
▪ ICT, healthcare and pharmaceuticals, electronic and manufacturing facilities, and housing are other
potential areas of enhanced cooperation.
▪ The countries are also looking for greater collaboration in civil aviation, a potential area especially in the context
of increasing trade and tourism.
▪ Besides, Saudi Arabia itself is undertaking large development projects in which Indian companies will be
looking to participate.
▪ These include Smart City, Red Sea Tourism Project, Entertainment City, etc.

Significance of Saudi relations for India

▪ Diaspora: India’s citizens make up the largest expatriate group in Saudi Arabia (3 million) as well as the gulf
region (7-8 million). Further, the Indian diaspora in the region remits around $35 billion a year.
▪ Security: Because of the large number of workers of Indian origin working in the Middle East, security and
stability in the region is of paramount importance for it.
▪ Energy interests: As Iran drops its positions as an oil supplier for India, as US sanctions tighten, Saudi Arabia
will be an important partner for India’s energy needs.
▪ India’s Link west policy: Deepening engagement with Saudi Arabia and the UAE could be noted as a galvanizing
point for India’s Link West policy.
▪ Yoga schools are now flourishing in Saudi cities.
▪ The Saudi Kingdom facilitates Hajj pilgrimage to over 1,75,000 Indians every year. This is one of the other
reasons why Saudi Arabia is an important country for India.

Significance of India for Saudi Arabia

▪ Pragmatism is dictating Saudi posture as the very future of the kingdom’s economic model is at stake.
▪ Economic reform programs are underway in Saudi Arabia, for which it needs India’s economic as well as
technological assistance.
▪ Saudi Arabia appears to have limited experience in countering threats from groups like Houthi militias
▪ This is an area where India’s expertise in fighting such threats could be imparted to the Saudi side, by enhancing
joint military training programs.

Saudi Prince visit to India in 2019:

The visit of Saudi Crown Prince to India in backdrop of Pulwama terror attack and subsequent Joint Statement on
terrorism marks the watershed moment in India-Saudi relations.
Outcome of the visit:
Strategic Partnership Council led prime minister and prince launched.
Saudi joined International Solar Alliance
Both countries agreed to establish Joint Working Group on Terrorism
Both countries also agreed to expedite the work for West Coast Refinery and Petrochemical Complex.
Saudi also said that they will share intelligence with India related to terrorism.
Joint Working Group on Skill Development: two countries can benefit from each other’s core competencies in
important fields such as manufacturing, information technology, communications, and programming.

Collaboration against COVID-19

▪ In order to deal with the unprecedented COVID-19 crises in a coordinated and united manner Prime Minister
Shri. Narendra Modi and Saudi Crown Prince had a telephone conversation on March 17, 2020 during which they
also planned to convene a G20 Virtual Summit.

95
▪ Continued coordination has been maintained between the two sides at the ministerial level. Owing to strong
people to people ties and continuous support extended by the Saudi government for the Indian community during
the pandemic.
▪ Both sides are ensuring cooperation in health and food security, maintaining supply chains & trade
commitments during the COVID period.
▪ Both nations have been sharing national experiences and supporting each other to ensure continued flow of food,
medicines and other essential items. Saudi authorities opened up the healthcare system for the Indian community
and provided free healthcare during the pandemic.
▪ Under this cooperation, a total of 1777 Indian healthcare professionals have returned to Saudi Arabia so far to
resume their duties to fight the Covid-19 pandemic.
▪ Mission has been involved in a About 200 charter flights have repatriated 35201 Indian citizens. There has been
excellent cooperation of Saudi authorities during the large-scale repatriation exercise (Vande Bharat Mission) of
the community took place due to COVID-19 pandemic.

Challenges for India

▪ The politics of the Middle East are complex and multidimensional.

▪ The Saudi Arabia-Turkey rivalry is one of the dimensions.
▪ Another dimension is the Saudi Arabia-Iran rivalry.
▪ India has close relations with both Saudi Arabia and Iran.
▪ However, India is yet to work out a way to balance its ties with Iran on the one hand and Saudi Arabia and the
United States on the other.
▪ Saudi Arabia’s aggressive foreign policy in West Asia: It is doing great damage to regional stability, which is
India’s most important goal in the region. Example- Saudi’s intervention in Yemen, Syria.
▪ Ideological support to terrorism: Saudi money has been accused of funding Wahhabi Islamic groups around the
world, which ultimately channel to terrorist groups acting against India & Iran. Many extremist outfits are inspired
by the Wahhabi branch of Islam.
▪ The working conditions for the Indian blue collared labourers in Saudi Arabia have been a major bilateral concern.

Way Forward

▪ Uplifting cooperation in the maritime security domain from the current status would be in the interest of both
countries.
▪ Holding joint naval exercises is important for maritime security cooperation as well as to safeguard international
trade via sea routes.
▪ Space is an important domain where bilateral engagements could be strengthened.
▪ India could explore the possibility to engage with the newly established Saudi Space Agency.
▪ The potential areas for next stage of bilateral cooperation could be greater bilateral synergy in Indian
infrastructure, agriculture, start-ups, skilling and IT.
▪ Shifting some labour-intensive establishments from Saudi Arabia to India would serve the respective national
priorities by reducing the kingdom’s expatriate population and boosting ‘Make in India’.
▪ India’s diplomacy in the wider Middle East region is marked by rich diplomatic ties with the three poles of
power, Riyadh, Jerusalem, and Tehran alike, without burning its hands in the region’s internal quagmire. Till
now, New Delhi’s diplomacy with the Gulf has not breached its equally consistent outreach with the others.

96
 (UNIT-3) CH-1 INDIA – AFGHANISTAN
RELATIONSHIP

India and Afghanistan have a strong relationship based on historical and cultural links. The relationship
has its foundations in the historical contacts and exchanges between the people.

Basics and Background

▪ Since time immemorial India and Afghanistan share good bilateral
relations with each other through trade and commerce.
▪ Selucas Nicator ceded much of its territory in Afghanistan to Mauryan
empire.
▪ There were several invasions from modern day Afghanistan to India in
medieval period.
▪ India has historically had friendly ties with Afghanistan and wishes to see a
stable government installed in Kabul that is independent of any external
interference.
▪ India’s policy towards Afghanistan today is what it has always been: that
there should be no outside interference and no export of
terrorism/extremism from there. In practical terms, its emphasis in recent
years has been on the reconstruction of the country.
▪ In 2016, Prime Minister Narendra Modi was conferred with Afghanistan’s highest civilian honour, the Amir
Amanullah Khan Award.

Political Relations
▪ During the Soviet-Afghan war (1979-89), India was the only South Asian nation to recognize the Soviet-
backed Democratic Republic of Afghanistan. India also provided humanitarian aid to then Afghan President
Najibullah's government.
▪ Until rise of Taliban in 1990s, India supported successive governments in Kabul. But unlike other countries, India
never recognized assumption of Taliban’s power in 1996.
▪ India was one of the key supporters of Anti – Taliban Northern Alliance.
▪ Afghanistan signed its first strategic partnership agreement with India, despite U.S and Pakistan’s keenness
for doing so.
▪ Afghanistan became the newest member of SAARC in 2007, due to India’s consistent efforts.
▪ India-Afghanistan relations have been further strengthened by the Strategic Partnership Agreement, which was
signed between the two countries in October 2011.
o The Strategic Partnership Agreement (SPA) between the two sides, inter alia, provides for assistance to
help rebuild Afghanistan's infrastructure and institutions.
o Education and Technical assistance to rebuild indigenous Afghan capacity in different areas.
o Encouraging investment in Afghanistan's natural resources.
o Providing duty free access to the Indian market for Afghanistan's exports support for an Afghan-led,
Afghan-owned, broad-based and inclusive process of peace and reconciliation.
o Advocating the need for a sustained and long-term commitment to Afghanistan by the international
community.

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▪ India-Afghanistan relationship is characterized by regular high-level exchanges. Leaders of both nations meet
each other during bilateral visits as well as on the sidelines of international events.
▪ The second meeting of India-Afghanistan joint working Group on Development Cooperation (JWG-DC)
was hosted in Kabul on 10 August 2018
o It is one of the four joint working Groups Under the India –Afghanistan Strategic Partnership Council Headed
by the Externals Affairs Minister of India and Foreign minister of Afghanistan.
o The two sides expressed satisfaction over the Successful completion of several development projects such as
the Afghan Parliament Buildings, Afghan-India Friendship Dam, The first phase of Chabahar port etc.
o The Afghan sides highly appreciated India’s timely assistance of 170000 tonnes of wheat and 2000 tonnes of
pulses during this year when large parts of the country are suffering from drought.
▪ Trilateral Meeting of the Islamic Republic of Afghanistan, Islamic Republic of Iran And Republic of India
was held on September 11, 2018 in Kabul, Afghanistan.
▪ Key points of this trilateral meeting are:
o Consolidating economic cooperation, including Chabahar port.
o Enhancing cooperation on Counter -Terrorism
o To support peace and Reconciliation process that is led and owned by Afghanistan.
▪ Days before India passed new Citizenship Act, Afghan government took the initiative to grant citizenship to
Afghan refugees from Hindu and Sikh communities living in India.
▪ Even though India shares a strong relation with Afghanistan, Afghan government has shown displeasure over the
new Citizenship (Amendment) Act, 2019.
▪ Afghan ambassador was among the first few who went public to voice his protest and stated that, Afghan
government has been “respecting the minorities, especially our great Sikh brothers and sisters”.
▪ Recently US-Taliban signed peace deal, after which India is forced to make a difficult decision on opening
dialogue with Taliban especially on being called upon by U.S envoy for Afghanistan and interest shown by
Taliban to have a dialogue with India.

Economic Relations
▪ India and Afghanistan have signed Preferential Trade
Agreement, which gives substantial duty concessions to
certain category of goods from both sides on entering each
other’s territory.
▪ Kabul wants Indian businessmen to take advantage of low
tax regime to develop manufacturing hub in areas such as
cement, oil, gas, electricity and in services including hotels,
banking and communications.
▪ On September 2017, CEO Dr. Abdullah inaugurated the
India-Afghanistan Trade and Investment Show. It
provided a valuable platform to showcase trade and
investment opportunities in Afghanistan. The show
generated business worth US$ 250 million and enhanced
the B2B linkages between India and Afghanistan
▪ The trade relations will realize its true potential once the
Wagah-Attari route is opened for bilateral trade so far, the Afghanistan-Pakistan Transit Trade Agreement
(APTTA) has been restrictive in this aspect.
▪ India is the largest market in the region for Afghan products and the free movement of commodities has been
affected with the blocking of transit. One of the objectives of building Zaranj-Delaram road by India was to
boost bilateral economic relations besides offering Afghanistan another outlet to a seaport.
▪ The successful operation of the Chabahar port in Iran would capitalize on this road to offer a new transit route of
Afghan products to India while opening a new route for India, and the rest of the world, for trade with Central
Asia.
▪ The inauguration of the Dedicated Air Cargo Corridor in June 2017 between Kabul-Delhi and Kandahar-Delhi
has provided a fresh impetus to bilateral trade.
▪ The bilateral trade between India and Afghanistan is expected to more than double to reach USD 2 billion by
2020 with the opening of air cargo route between the two countries.

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▪ Afghanistan offers huge untapped market which is presently dominated by Pakistan, Iran and Turkmenistan for
Indian industries.

Terms of Trade
▪ The bilateral trade at for the year 2017-18 stood at approx. USD 1.14 billion and has immense potential to be
expanded further.
▪ India have trade surplus with Afghanistan, with India exporting USD 715.44 Mn and importing USD 435.44 Mn
in the financial year, 2018-19.

Major items of exports from India: Major items of imports to India:

Electrical, electronic equipment, oils, tobacco, Fruits and nuts, gums and resins, coffee, tea, spices etc.
pharmaceutical products etc.

• The trend of India’s export and imports with Afghanistan can be seen in the figure below:

India's trade with Afghanistan

800
600
400
200
0
2014-15 2015-16 2016-17 2017-18 2018-19

EXPORT ( in Mn) IMPORT ( in Mn )

Infrastructure Project
India has funded some major Afghan reconstruction and
development plans and has invested US$2 billion so far. The funds
have been spent on:
▪ Restoration of Stor Palace in Kabul also known as Star
Palace or Kasre-estar.
▪ India completed construction of Zaranj-Delaram highway in
South-West Afghanistan near Iranian border in January 2009.
▪ The new Parliament of Afghanistan is being built by India.
▪ Rebuilding of the Habibia High School in capital
and providing it with grants-in-aid.
▪ Reconstructing the Indira Gandhi Institute for Child
Health/Indira Gandhi Children’s Hospital in Kabul.
▪ Hydroelectric power projects, such as Salma Dam (Afghan-India Friendship Dam)
▪ Turkmenistan- Afghanistan- Pakistan- India (TAPI) also known as Trans-Afghanistan pipeline is a natural gas
pipeline being developed by the Galkynsh-TAPI Pipline Company Limited with the participation of the Asian
Development Bank.
▪ Some benefits of TAPI pipeline are listed as follows:
o The pipeline is expected to facilitate a unique level of trade and co-operation across the region, while also
supporting peace and security between the four nations.
o More than 1.5 billion people in Afghanistan, Pakistan, and India are expected to benefit from the long-term
energy security provided by the project.
o In addition, the project is expected to boost the revenues of Turkmenistan via the sale of gas.

Overview of TAPI Pipeline

Countries Turkmenistan, Afghanistan, Pakistan, India
General direction North -South
Originated from Galkynysh gas field, Turkmenistan

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 Passes through Herat, Kandahar, Quetta, Multan
Ends at Fazilka, India
Runs Alongside Kandahar-Herat Highway
Type Natural gas
Length 1814 km
Maximum Discharge 33 billion cubic meters per annum

Strategic Importance
▪ With growing economy, India requires more energy to sustain its growth and Afghanistan contributes in India’s
energy security.
▪ Strategically Afghanistan acts as a gateway connecting South Asia with East, Central and West Asia.
▪ A stable government in Afghanistan will help in reducing terrorist activities and militancy in Kashmir.
▪ In any confrontation with Pakistan, Afghanistan will become important for strategy of our military operations.

Security and Defence

• India was the first country Afghanistan chose to sign a strategic
partnership agreement with. India signed a strategic partnership
agreement in 2011 to assist in “the training, equipping and capacity-
building programs for the Afghan National Security Forces”.
• India aids the Afghan National Defence and Security Forces in fighting
the scourge of terrorism, organized crime, trafficking of narcotics and
money laundering. Further India supports an Afghan-led and Afghan-owned
peace and reconciliation process.
• India donated three Mi-25 attack and Mi-35 choppers to Afghanistan as
part of the bilateral strategic partnership to counter the Taliban.
• India has provided military vehicles for the Afghan National Army.

Strategic Partnership Council Agreement (Saudi Arabia)

• India’s first Strategic Partnership Council was formed with Afghanistan under the Strategic Partnership
Agreement signed between Hamid Karzai and Manmohan Singh in 2011.
• Its objective was to strengthen Indian cooperation with Afghanistan post-2014 US withdrawal of troops from
Afghanistan.

Energy
▪ Construction of Salma Dam Power project in Heart, it is now renamed as India-Afghanistan Friendship Dam.
▪ Establishment of an electricity transmission line from Pul-e-Khumri to Kabul.
▪ India has also constructed the Chimtala power substation in Kabul.

Connectivity
▪ Chahbahar Port: India is cooperating with Afghanistan and Iran for development of the Chahbahar Port which
provides an alternative route to Afghanistan and Central Asia. In this context, a trilateral transport and transit
agreement based on sea access through Chabahar has been signed.
▪ Air Freight Corridor: India and Afghanistan inaugurated a dedicated
air freight corridor service in 2017 which could provide Afghanistan
greater access to markets in India.
▪ Afghanistan and Pakistan signed Afghanistan Pakistan Transit and
Trade Agreement (APTTA) in 2011 which gives each country equal
access up to the national boundaries of both. At present, Pakistan allows
Afghan trucks carrying goods meant for India, only up to its last
checkpoint at Wagah, and not to the Indian checkpoint at Attari, less than
a kilometer away. India is keen to join APTTA and Afghanistan has
backed India’s readiness to be an APTTA member though Pakistan has so
far rejected such a proposal.

Human Resource Development and Capacity Building

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▪ Human resource development and capacity building initiatives constitute an important segment of India's
assistance in Afghanistan.
▪ On an average, more than 3,500 Afghan nationals undergo training/education in India every year.
▪ More than 15,000 Afghan students pursue education in India on self-financing basis. India’s assistance in
human resource development has helped to create a large pool of trained manpower that has been an asset to both
the public and private sectors in Afghanistan.
▪ India’s initiatives in this field include:
1. Following the reconstruction and renovation of Habibia School in Kabul, India extended assistance for
training and maintenance of the school.
2. A Special Scholarship Scheme of 1,000 scholarships per annum to Afghan nationals (administered by
ICCR) with 100% utilization in most years.
3. India offers over 1,000 Indian Technical and Economic Cooperation (ITEC) slots to Afghanistan
annually in these areas. The ITEC training is expected to address Afghanistan’s need to strengthen its
administration and governance at national, provincial and district levels, including through sharing
experiences and technical assistance in building capacities of civil administration and project implementation.
4. The Afghanistan National Agricultural Sciences and Technology University (ANASTU) established with
India’s assistance is contributing to capacity building in agricultural sciences. The Indian Agriculture
Research Institute (IARI) is involved in training, equipping and establishing the University.
5. Under India-Afghanistan Agricultural Fellowship Programme, Afghan students and scholars pursue
graduation and research courses at various agricultural universities and institutes in India.
6. Nearly 50 Afghans are completing graduation in the Indian school of Mines Dhanbad with a view to
strengthen technical man-power in mining sector in

Humanitarian Projects
▪ India has provided funds to Afghan Red Crescent Society program.
▪ To combat the global pandemic of COVID-19 and related issues of food security, India is committed to deliver
75,000 MT of Wheat to Afghanistan in 20 A Medical Diagnostic Centre in Kabul was set up in 2015. The
Centre provides latest diagnostic facilities to children of Afghanistan thereby generating goodwill for India.
▪ In addition, India has also undertaken supply of 5 lakh tablets of Hydroxy-chloroquine, 1 Lakh tablets of
Paracetamol and 50,000 pairs of surgical gloves to Government of Afghanistan in 2020.
▪ India also provides free medicine and medical consultations in its medical missions in five Afghan cities.
▪ India enables Afghan public institutions with technical advisers.
▪ India also imparts training for Afghan public servants, policemen and soldiers.
▪ India regularly provides hundreds of scholarships for Afghan students, vocational courses for Afghan youth
and Afghan women
▪ India has also provided tele-education courses to Afghanistan.

Cultural Ties
▪ Afghanistan has been an important trading and craft centre for over 2000 years connecting the civilizations of
Persia, Central Asia with India. However, over 3 decades of war have undermined Afghanistan’s unique traditions
of art and architecture.
▪ India and Afghanistan share centuries old cultural heritage with deep-rooted linkages in the field of music, arts,
architecture, language and cuisine.
▪ In the field of music, in particular, most Afghan musicians were trained in the Patiala Gharana. Today, Indian
films, songs and TV serials are popular with the masses, contributing significantly to the popularization of Hindi
and familiarization of the populace with Indian socio -cultural value system.
▪ An India-Afghanistan Culture Week was held in New Delhi in November 2017 as a result of collaboration of
India-Afghanistan Foundation (IAF) and ICCR.
▪ The 11th Board Meeting of the India-Afghanistan Foundation was held on 24 December 2018 at the Delhi
Chapter. The Board reviewed the working of the Foundation and looked into new proposals from both the
Chapters.

Sports Cooperation
▪ India and Afghanistan have robust relations in the field of sports. Since 2011, Afghanistan Under-14 & Under-
17 Boys’ and Under-17 Girls’ football teams have been participating in the Subroto Cup International Tournament
organized every year by the India Air Force.

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▪ Cricket has been a major factor in promoting people-to-people ties between the two countries. Afghanistan
Cricket Board (ACB) has been allotted three cricket home grounds in India (Noida, Dehradun and Lucknow).

Indian Diaspora in Afghanistan

• Presently, there are estimated to be about 1700 Indians in the country. Most of the Indians in Afghanistan are
engaged as professionals in Banks, IT firms, construction companies, hospitals, NGOs, telecom companies,
security companies, universities, Govt. of India sponsored projects, Govt. of Afghanistan and UN Missions.
• The Mission interacts closely with members of the Indian Diaspora, assisting wherever required. The Diaspora
members also actively participate in the Mission’s cultural activities and celebrations of national days.

Heart of Asia (HoA) -Istanbul Process

▪ The Heart of Asia-Istanbul Process (HoA-IP) was founded on
November 2nd, 2011 in Istanbul, Turkey. The Heart of Asia
provides a platform for sincere and results-oriented regional
cooperation by placing Afghanistan at its center, in recognition
of the fact that a secure and stable Afghanistan is vital to the
prosperity of the Heart of Asia region.
▪ This platform was established to address the shared challenges
and interests of Afghanistan and its neighbors and regional
partners.
▪ The Heart of Asia is comprised of 15 participating countries,
17 supporting countries, and 12 supporting regional and international organizations.
▪ Its three key pillars are:
1. Political Consultation
2. Confidence building Measure (CBM)
3. Cooperation with Regional Organisation

Sixth HoA Conference, 2016

▪ The sixth edition of ‘heart of Asia- Istanbul’ process of Afghanistan conference an annual regional gathering of
Asian and other countries was held in Amritsar, Punjab (India).
▪ Theme of this conference was- “Addressing Challenges, Achieving Prosperity”.
▪ The three big issues of this conference were:

•Countering terrorism to create stabilityin Afghanistan

First

•Providing Afghanistan connectivity to strengthen economic

Second activities

•The development which is important for the progress of Afghanistan

Third

8th Heart of Asia-Istanbul Process Ministerial Conference, 2019:

▪ Theme of this conference was Peace, Partnership and Prosperity
▪ Presidents of Afghanistan and Turkey H.E. Mohammad Ashraf Ghani and H.E. Recep Tayyip Erdoğan
inaugurated with their opening statements the 8th Heart of Asia-Istanbul Process Ministerial Conference convened
in Istanbul

India’s Interest in Afghanistan

• Natural Resources: Afghanistan has significant oil and gas reserves and has rich source
of rare earth materials.
Economic • The massive reconstruction plans for the country offer a lot of opportunities for Indian
importance companies for investment.

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 • It has also signed the TAPI pipeline project that aims to bring natural gas from
Turkmenistan through Afghanistan and Pakistan to India.
• Stable government in Kabul is essential to reduce terror activities across south Asia also
in Jammu and Kashmir. Thus, the most important goal for India remains the prevention
of Pakistan from regaining its central role in Afghan affairs.
Security • Negating the influence of Pakistani Inter – Services Intelligence (ISI) - backed group
like the Taliban, which are hostile to Indian interest.
• Curtailing the spread of drugs- trafficking.
• Securing Afghanistan as a trade and energy corridor to central Asia.
• India needs positive relations with Afghanistan to keep an eye on Pakistan.
• To suppress the rise of Islamist extremism.
Gateway to energy • Afghanistan is situated at crossroads between South Asia and Central Asia and South
rich Central Asia Asia and the Middle East.

US – Taliban Peace Deal

▪ Recently United States and Taliban signed an agreement in Doha
titled, “Agreement for Bringing Peace to Afghanistan”.
▪ The agreement outlines not only about troop withdrawal as well
as sanction removal, prisoner's release and Taliban’s
commitment.
▪ Under the agreement US will withdraw its troops as well as of
NATO and coalition troops, within 14 months.
▪ Taliban have committed that it will not allow any of its members,
other individuals or groups, including Al-Qaeda, to use the soil of
Afghanistan to threaten the security of United States and its allies.
▪ Sanction Removal: UN sanctions on Taliban will be removed in
three months and by August 27, US will also remove its sanctions.
▪ Prisoners Release: The pact says that up to 1000 prisoners held by Taliban and up to 5000 Taliban imprisoned,
will be released by March 10th.

Impact on India
▪ The agreement talks about “preventing the use of Afghan soil by any group, individual, against security of
United States and its allies”. However there is lack in clarity whether India is included in its allies definition
or not and if terrorist groups backed by Pakistan will still operate in Afghanistan soil.
▪ The agreement also discusses about release of prisoners, there are high chances that these released prisoners will
amalgamate with terrorist groups acting against India.
▪ Removal of UN sanctions brings threat to India’s security as it’ll lead to decrease in listings of number of
terrorists housed by Pakistan.
▪ India have never given diplomatic and official recognition to Taliban, however considering the current
scenario, India should not only have a conversation with Taliban but all of its stakeholder for long term stability.

Moscow Format 2017:

• Introduced in 2017, as a multi nation consultations on securing peace in Afghanistan.
• 2018: 2nd meeting led by Russia, held with participation of 12 nations and Taliban.
• US formally ended ‘Operation Enduring Freedom' in 2014, Since then, Taliban has been regaining ground (esp.
with support from Pakistan)
• Various efforts like Quadrilateral group (US, China, Afghanistan, Pak) and Trump’s S. Asian policy to use
Pakistan and strengthen Afghan capabilities have borne almost no results.
• This has led to a fragile situation in Afghanistan and even holding upcoming elections seem a huge challenge.

Interests and stands of key parties in Moscow Format

Russia Looking to strengthen a non- USA alliance in Afghanistan (esp. with Iran, China, C. Asian

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 Countries)
Afghanistan Sent a non-govt delegation (maintaining a distance from Taliban, perhaps under US pressure)

USA Observer status → wait and watch on Russia’s involvement.

• Unwilling to talk to Afghan govt (which it cites as illegitimate)
Taliban • Wants direct negotiations with USA
• Gains legitimacy through involvement in such a multi nation consultation process.

• No direct talks with Taliban

• Opposes 3rd parties conducting talks with Taliban as it provides legitimacy to the terror
organisation
Indian Stand • As direct talk between Afghan-Taliban seems impossible, a regional process like Moscow
Format become next best option
• Sent 2 observers at non-official level
• Supports all efforts for peace but must be led and controlled by Afghanistan.

Security Issues

• Various reports have confirmed that Pakistan provide disguised assistance to

Emerging threats from terror groups in Afghanistan to act against India.
terrorist • India cannot let such camps to further aggravate the situation and it can only be
resolved by establishing democracy and development in that region.
• Indian consulate, Indian aid workers, engineers are facing major attacks in
Afghanistan.
Attacks on Indians • Due to such issues, it becomes critical for Indian government to save the lives of
its citizen and continue development in Afghanistan.
• Therefore, India has deployed its paramilitary forces to guard aid workers and
engineers.
• Instability in the region poses threat to India’s economic interest as well.
Economic Impact • It will also impact India’s connectivity to major west Asian countries.
• Instability in the long run can challenge India’s demand for energy.

Bottomline
• Without bringing about peace, the resources keep getting diverted to conflicts instead of rebuilding Afghanistan.
• Despite different geopolitical considerations of different parties, Moscow Format has presence of all stakeholders
on Afghanistan and if handled right, has the potential to bring about a measure of stability in the fragile region.

Way Forward

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▪ India has a range of interest in Afghanistan that it would like to preserve and enhance.
▪ India must contribute towards its role in the peace efforts in Afghanistan. It can start by doing sincere efforts to
bridge the Ghani-Abdullah divide.
▪ India is now in such position where it can bring other major leaders with whom India has built ties for decades to
play active role in stability of Afghanistan and provide administrative reforms.
▪ There is huge untapped potential in markets of Afghanistan which Indian companies can exploit.
▪ The need of the hour during this time of Pandemic for India is to support Afghanistan in all spectrum and tighten
its belt to prepare for future.

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 CH-2 INDIA - BANGLADESH

▪ India-Bangladesh bilateral relations began on a positive note in this year with the exchange of New Year
greetings between Prime Minister Modi and Prime Minister Sheikh Hasina on 01 January 2020.
▪ The two Prime Ministers jointly inaugurated four bilateral developmental projects in March 2019 in Bangladesh
through video-conferencing including:
1. Supply of 500 trucks, 300 double decker buses and 200 AC buses under the second Line of Credit,
2. Extension of National Knowledge Network to Bangladesh,
3. Establishment of 36 community clinics in five districts of Bangladesh and
4. Establishment of 11 water treatment plants in Bangladesh and another three projects in October 2019
including
a. Inauguration of Vivekananda Bhaban at Rama Krishna Mission in Dhaka,
b. Import of bulk LPG from Bangladesh and
c. Inauguration of Bangladesh-India Professional Skill Development Institute (BIPSDI) at the Institution
of Diploma Engineers, Bangladesh (IDEB), Khulna

Basics and Background

▪ India and Bangladesh have shared history, common heritage, cultural, civilizational and linguistic ties.
▪ India played the great role in emergence of independent Bangladesh. Along with common history of struggle
for freedom and liberation, India was also the first country to recognize Bangladesh as a separate and
independent nation and established diplomatic relations with it.
▪ The historic land boundary agreement signed in 2015 opened a new era in the relations.
▪ India has always stood by Bangladesh in its hour of need with aid and economic assistance to help it cope with
natural disasters and floods.

Bangladesh: A Significant Neighbour for India

▪ Strengthening south Asia as a regional power: Organisation like SAARC (South

Asian Association for Regional Cooperation) for promoting cooperation among its
member nations to economic growth and securing strategic interest.
Geopolitical ▪ Bridge to southeast Asia: Bangladesh is an important pillar for India for act east
policy. Dhaka support in BIMSTEC and BBIN initiatives complement Delhi’s
Southeast outreach.
▪ Connecting Northeast India: Bangladesh’s location is a strategic point between
mainland India and NE seven states. These states are landlocked and has a shorter route
to the sea through Bangladesh.
▪ Fighting terrorism and deradicalization: both the countries are very vulnerable to the
propaganda of religion based on radical thinking; thus, they could cooperate in
Geo-strategic deradicalisation efforts, sharing intelligence, and other counter-terrorism efforts.
▪ To control insurgency in Northeast: A friendly Bangladesh can ensure that no Anti-
India terror or insurgent activities can be carried out from its soil.

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 ▪ Countering China: A neutral Bangladesh also ensures Containment of an assertive
China in this region including along the strategic sea lanes of the Bay of Bengal
▪ The two nations are also part of Indian Ocean Rim Association (IORA) working
together in managing the crucial maritime region, and ensuring its stability which is
also reflected in the Modi government’s SAGAR (Security and Growth for All in the
Region) programme.
▪ Bilateral trade: Currently, the volume of bilateral trade between India and Bangladesh
is about $9 billion while the trade potential is at least four times the present level.
▪ Investment opportunities: There are huge opportunities for investment in defense,
Economic such as in military hardware, space technology; infrastructural development, and other
importance areas.
▪ Cooperation in blue economy: such as exploration of hydrocarbons, deep-sea fishing,
preservation of marine ecology and disaster management.
▪ Social sector development: Bangladesh is now a role model for the developing world
in poverty reduction, achieving success in health and education and fighting climate
change, among others.

Political Relations
▪ During the Indian independence movement, the region of
Bangladesh was place of origin of Muslim League and ‘Pakistan
Movement’.
▪ After partition this region became ‘East Pakistan’ and Jinnah, in
1948, imposed Urdu as national language in East Pakistan too,
despite Bengali being its mother tongue.
▪ A number of other reasons such as a military action of Gen Yahiya
Khan over Bengalis, dismissal of outcome of 1970s general election
resulted in nationwide civil disobedience.
▪ After several clashes between civilians and military which became genocide, nearly 10 million refugees entered
India.
▪ India gave money and material support to Mukti Vahinis. However it has to go on war with Pakistan to fully
settle the issue.
▪ The 1971 war ended in decisive victory over Pakistan and led to the birth of Bangladesh. Mujib-ur-Rehman
became its first Prime Minister.
▪ Relations between India and Bangladesh have been fluctuating ever since with alternate good and bad times.
▪ Presently, India is in the best phase of bilateral relationship with a number of major breakthroughs achieved in
terms of Land Boundary Agreement, resolution of Marine Boundary Dispute, electricity trade etc.

Economic, commercial and Trade Relations

▪ Economic relations between India and Bangladesh has been multifaceted, embracing trade transactions, credit
arrangements, joint ventures, transit facilities and transport development.
▪ These relations have continued and expanded unhindered even in situations of adverse political relations owing
mainly to geographical proximity, common language, similar consumption pattern.
▪ The geographical proximity opens avenues for high volume of
bilateral trade. However, due to large and porous border, there
are huge volumes of informal trade from India.
▪ The substantial informal and unrecorded trade carried across
the India Bangladesh border, is more quasi legal in nature. It is
often described as ‘informal’ rather than illegal, since there is wide
participation of local people in border areas who operate in contact
with the anti-smuggling enforcement agencies.
▪ Bangladesh is India’s biggest trade partner in South Asia.
Bilateral trade between India and Bangladesh has grown steadily
over the last decade. India’s exports to Bangladesh in FY 2018-19
stood at US$ 9.21 bn and imports from Bangladesh during the
same period were US$1.04 bn.

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▪ Meetings of various institutional mechanisms to promote bilateral
trade including that of border haats, shipping, LCS/ICP
infrastructure and on establishment of Indian Economic Zone
etc. were held in 2019.
▪ According to the latest reports of World Bank, Bangladesh is
among the fastest growing economies of South Asia with the real
GDP growth estimated at 8.1 % in 2019.
▪ Low cost labour intensive manufacturing and agriculture are the 2
major pillars of the Bangladeshi national economy.
▪ The minimum necessary legal and institutional infrastructure for
supporting economic relations between two countries has long been
in place. These include bilateral trade agreement, Joint Economic
Commission, trade review meetings, Joint River Commission and Inland Water Trade and Transit
Agreement.

Some of Chinese initiatives in Bangladesh

▪ China is financing 25 energy projects, in Bangladesh including 1320-Megawatt power plant. China has
extended its support to build Bangladesh Second Nuclear power plant.
▪ Highway and rail network connecting Bangladesh through Myanmar to Yunnan province.
▪ Bangabandhu-1 First communication satellite of Bangladesh was negotiated and financed through help of
Chinese government.

Infrastructure Project
1. Connectivity -
▪ The movement of goods by road is operationalised through 20 Land Customs
Stations (LCSs) along the border and more than 20 have been notified for
operationalisation.
▪ India has given $8 Bn Line of Credit (LoC) for the construction of Akhaura-
Agartala rail project which shortened the distance between Dhaka and Kolkata
to 550 km from 1650 kms earlier.
▪ The railway line will provide a major boost to development and economy of
Eastern Bangladesh and North Eastern India.
▪ The two nations are working jointly on the rehabilitation of Kulaura-Shahbazpur
section of railway line which will provide direct rail connectivity to Karimganj
district of Assam and other North Eastern states.
▪ India has launched Dhaka-Khulna-Kolkata bus and Khulna-Kolkata
“Bandhan Express” services in 2017 and end-to-end customs and immigration services for Dhaka-Kolkata
“Maitri Express” to provide transport, connectivity and people to people contact.
▪ The Bangladesh, Bhutan, India and Nepal (BBIN) – Motor Vehicles Agreement (MVA) will significantly
boost connectivity by road. The trial Run of Cargo Movement on Trucks from Kolkata to Agartala via Dhaka and
Dhaka to New Delhi via Kolkata and Lucknow has been conducted in August 2016.
▪ The Protocol on Inland Water Trade and Transit (PIWTT) has been operational since 1972. It permits
movement of goods over barges/vessels through the river systems of Bangladesh on eight specific routes. The
PIWTT was renewed for a period of five years with
provision for auto renewal during the Prime Minister’s visit
to Bangladesh in June, 2015.
▪ Connectivity through the Coastal Waterways enabled by
the signing of the Coastal Shipping Agreement is also of
priority to both India and Bangladesh.

2. Power
▪ The countries have started cooperation on renewable
energy, solar power and nuclear power.
▪ Cooperation in power sector has become one of the
hallmarks of India-Bangladesh relations. Bangladesh is
currently importing 1160 MW of power from India. The

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 meetings of Joint Working Group (JWG)/Joint Steering Committee (JSC) on power were also held in 2019.
▪ India is providing Bangladesh technical assistance for the construction of the 2,400 MW Rooppur Nuclear Power
Plant in Pabna, Bangladesh’s first nuclear plant which is expected to go into operation by 2020.
▪ Maitree Super Thermal Power Project of 1,320 MW at Rampal, Bangladesh is already progressing well.
▪ The nations are working on construction of 130 km Bangladesh-India Friendship Pipeline between Siliguri in
West Bengal and Parbatipur in Dinajpur district, Bangladesh. (The pipeline will supply around 400,000 tonnes
diesel to Bangladesh annually).

Cultural Ties
▪ The India-Bangladesh Cultural Agreement covers a range of areas
of cooperation including art and culture, mass-media, films and press,
sports and youth activities, archaeology, museums, libraries and
education activities.
▪ The objectives enshrined in the Cultural Agreement are realized
through the Cultural Exchange Programmes between the nations
enhancing people to people contacts.
▪ Indo Bangla Baul Music Festival is an example of deep cultural ties
between the two countries.
▪ The Indira Gandhi Cultural Centre (IGCC) in Dhaka has been
regularly organizing 5 cultural activities since 2010.

Defence Cooperation
▪ Defence cooperation between India and Bangladesh has seen significant progress in the last few years.
This push is illustrated in the exchange of visits between leaders of the two nations, as well as the conduct
of training programmes, joint exercises, and Humanitarian Assistance and Disaster Relief (HADR).
▪ The year 2019 witnessed significant strides in defense cooperation between India and Bangladesh. High level
exchanges at the level of services chief of Indian Navy, Bangladesh Navy and Indian Air Force, conduct of second
annual defense dialogue and inaugural tri-services staff talks, service specific talks of Navy and Air Force and the
DG level talks between the Coast Guards have contributed to significant improvement in bilateral defense
cooperation.
▪ The Indian army band also for the first time performed at the national parade of Bangladesh during Victory
Day celebration. In the training domain both the countries have continued and enhanced mutual engagements.
▪ Muktijoddha related engagements, annual reciprocal visit of Mukti-joddhas and war veterans on the occasion of
Victory Day were undertaken in 2019 and scholarships were distributed to heirs of Mukti-joddhas.
▪ The joint exercise of Army –Sampriti And Navy- Milan take place between the two countries on annual
basis for better military cooperation.
▪ During Prime Minister Hasina’s 2017 visit to India, the two countries signed a series of agreements and MoUs in
areas of defence cooperation, including the following:
o MoU on the framework for defence cooperation.
o MoU between India’s Defence Services Staff College and Dhaka’s Defence Services Command and Staff
College for enhancing cooperation in the field of strategic operational studies
o MoU between Dhaka’s National Defence College and India’s Defence College for enhancing cooperation
in the field of strategic studies
o MoU for extending a line of credit worth US$500 million for the purchase of defence equipment
o MoU between the coast guards of the two countries.

Security & Border Management

▪ A number of agreements related to security cooperation have been signed between both the countries. This
includes a Coordinated Border Management Plan (CBMP) signed in 2011 to synergize the efforts of both
Border Guarding Forces for more effective control over cross border illegal activities and crimes as well as for the
maintenance of peace and tranquility along the India-Bangladesh border.
▪ Director General (DG) Level Talks between Border Security Force (BSF) and the Border Guard
Bangladesh (BGB) were held in 2019. In addition, border coordination conferences between regional
commanders of BGB and frontier Inspectors General of BSF were also held to discuss management and security
of 4096.7 Km of the India-Bangladesh land border.

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▪ India and Bangladesh share 4096.7 km. of border, which is the longest land boundary that India shares with any of
its neighbors. The India-Bangladesh Land Boundary Agreement (LBA) came into force following the
exchange of instruments of ratification during Hon’ble PM’s visit to Bangladesh in June 2015.
▪ On 31 July, 2015 the enclaves of India and Bangladesh in each other’s countries were exchanged and strip
maps were signed. Residents of these erstwhile enclaves, who opted to retain their Indian citizenship made a
final movement to India by 30 November 2015.
▪ The settlement of the maritime boundary arbitration between India and Bangladesh, as per UNCLOS award
on July 7, 2014, paved the way for the economic development of this part of the Bay of Bengal, and will be
beneficial to both countries.

Sharing of River Waters and Water Dispute

▪ India and Bangladesh share 54 rivers between each other.
▪ Joint Commission for Water Management was set up in
1972.

Teesta River Dispute and Agreement Issues:

▪ Teesta river has it its source in Sikkim, it flows through
northern part of West Bengal before entering Bangladesh,
where after coursing through about 45km of irrigable land, it
merges with Brahmaputra.
▪ While it drains 2800 sq km of Bangladesh, governing the life
of hundreds and thousands of people. For West Bengal, Teesta
is equally important, considered the lifeline of half-a-dozen
districts in North Bengal. It still remains an unresolved issue.
▪ Bangladesh sought a fair and equitable distribution of Teesta waters from India, on the lines of the Ganga Water
Treaty 1996.
▪ In 2011 India and Bangladesh finalized an arrangement, by which India would get 42.5% and Bangladesh
37.5% while remaining 20% would flow unhindered in order to maintain a minimum water flow of the
river. This agreement was not signed due to opposition from chief minister of West Bengal.
▪ The treaty is an agreement to share surface waters at the Farakka Barrage near their mutual border.
▪ In 2015, the Indian Prime Minister’s visit to Dhaka generated expectations to take forward the issue but it still
remains unresolved.
▪ In India, individual states have significant influence over transboundary agreements, impeding the policymaking
process.
▪ West Bengal is one of the key stakeholders of the Teesta agreement and is yet to endorse the deal.

Timeline of Dispute:

1983 Teesta River Agreement allows India and Bangladesh to share 75% of river water on 39% and 36% basis, but
the transient agreement could not be implemented as the countries hit a roadblock.

According to 1984 Joint Review Commission, countries share increased based on hydrological data. For Bangladesh
it became 37.5% and for India 42.5, unallocated portion being 20%

In 1998, Bangladesh started Teesta Barrage Irrigation Project.

Talks resumed after change of power in Bangladesh, in 2011 when former PM Manmohan Singh visited Dhaka, It was
announced that India would share the remaining 25% of the river water on a 50:50 basis. However this faced stiff opposition
from West Bengal government and therefore India refrained from signing the agreement.

110
 Teesta River
▪ It is a tributary of the Brahmaputra (known as Jamuna in Bangladesh), flowing through India and Bangladesh.
▪ Origin: In the Himalayas near Chunthang, Sikkim and flows to the south through West Bengal before entering
Bangladesh.
▪ Drainage: It covers nearly the entire floodplains of Sikkim while draining 2,800 sq km of Bangladesh. For West
Bengal, it is the lifeline of half-a-dozen districts in North Bengal.
▪ Latest Development: In March 2020, the Border Roads Organisation (BRO) opened a 360 feet long bailey
suspension bridge over Teesta river in Munshithang, Sikkim.

West Bengal’s stand on the issue:

▪ It is estimated that the Teesta River has a mean annual
flow of 60 billion cubic meters but a significant
amount of this water flows only during wet season
(June-Sept) leaving scant flow during the dry
season (October-May) wherein the average flow gets
reduced to about 500 million cubic metres (MCM) per
month.
▪ This creates issues of equitable sharing during lean
season.
▪ Bangladesh has claimed that West Bengal’s
Gazaldoba barrage is ‘unilaterally’ channelizing a
large volume of water on the Teesta, due to which
the country’s historic flow has been reduced to only
10% and its Teesta Irrigation Project has suffered.
▪ It is also claimed that since Bangladesh has higher per
capita water availability, then why to equally share
waters of Teesta. Apart from that after construction of
Teesta Barrage in 1998 by Bangladesh, farmers there
are taking three crops per year.

Tapaimukh Dam Issue:

▪ Tipaimukh hydroelectric power project is a proposed embankment
dam on the river Barak in Manipur state India, first commissioned in
1984.
▪ According to Bangladeshi government, the construction of dam would
disrupt the seasonal rhythm of the Barak River and its two
downstream channels, which in turn would cause great ecological
damage on the Bangladeshi side and potentially turn North East
Bangladesh into a desert and destroy the livelihood of thousands of people.
▪ India however, believes that the dam will actually help control floods,

111
 improve river navigation and aid the fisheries sector.

Farakka Barrage Dispute:

▪ In 1996, the sharing of the Ganga waters was successfully agreed
upon between the two nations but there is a long pending dispute
over India’s construction and operation of Farakka
Barrage which was constructed to increase the water supply in
river Hooghly.
▪ Bangladesh complains that it does not get a fair share of the water
in the dry season and some of its areas get flooded when India
releases excess waters during the monsoons.
▪ Since, water is a state subject in India, so the bottleneck lies in the
non-consensus between state government of Bengal and India,
to review the dam’s relevance & give some concessions to Bangladesh.
Maritime Border Dispute
▪ While Bangladesh, having concave
coastlines, delimits its sea border
southward from the edge of its land
boundary, India stretches its claim
southeast wards, covering around
thousands of miles in the Bay of Bengal.
▪ Due to competing claims of the two
countries, delimitation of the sea
boundary and determining Bangladesh’s
exclusive economic zones have remained
unresolved.
▪ Moreover, in terms of determining the
continental shelf, the presence of the
Andamans and Nicobar Islands puts India, in a
favourable position.
▪ The issue of demarcating territorial waters led to serious differences between the two countries. Questions
of ownership over a new born island known as South Talpatty in Bangladesh and New Moore/ Purbasha in
India spotted by a satellite picture in 1975 in the estuary of Haribhanga River on the border of the two
countries has been a source of contention since its discovery.
▪ In order to settle the above dispute Bangladesh proposed sending a joint Indo‐Bangladesh team to determine
the flow of channels of the river on the basis of existing International Law of the Sea. But the Indian
counterpart sent forces to establish claims by stationing naval troops on the island in 1981.
▪ After initial resentment by Bangladesh, India agreed to resolve the issue through negotiations.
▪ The dispute regarding the delimitation of the maritime bouandary between India and Bangladesh was settled after
the verdict of the Permanent Court of Arbitration (PCA) in july 2014 with a United Nations tribunal awarding
Bangladesh 19, 467 sq. km of the 25,602 sq. km sea area of the Bay of Bengal.

Land Border Dispute

▪ India and Bangladesh share almost 4096 km of land border, which is the longest land boundary that India shares
with any of its neighbors.
▪ The border disputes between two countries are not confined to demarcation problems. It is linked to other
problems like illegal migration of people and goods and other cross border criminal activities.
▪ The border drawn by Sir Cyril Radcliff on basis of two nation theory, provided for India’s control over 112
enclaves and Bangladesh’s control over 32 enclaves based on religious identities of inhabitants of those areas.
▪ The two countries also share nearly 1116 kms of riverine boundary.

Land Boundary Agreement (LBA)

▪ LBA between India and Bangladesh was signed in 1974. Bangladesh parliament ratified it same year but Indian
parliament deferred the ratification as it involved cession of Indian territories to Bangladesh.
▪ The demarcation of land boundary between two countries took place according to 1972 agreement in 2011.

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▪ Real exchange of territories requires constitutional amendment as
it makes changes to 1st schedule. Thus 119th Constitutional
Amendment Bill is passed by parliament in 2015. The Act
contains:
o Transfer of 111 Indian enclaves to Bangladesh in exchange
of 51 Bangladeshi enclaves to India.
o Citizenship rights to those living in 51 Bangladeshi
enclaves in India under section 7 of Indian Citizenship Act,
1955.

Benefits of LBA:
▪ Smuggling, illegal migration, human and drug trafficking and
other criminal activities across the border will now be checked
more effectively.
▪ People living in enclaves will get full citizenship and respective rights.
▪ Improved access to North East India and connectivity to South- East Asia.
▪ Signing of LBA has boosted prospects of future cooperation and trade with Bangladesh.

Technical Cooperation
▪ Bangladesh is an important ITEC partner country, and a large number of participants from Bangladesh have
availed of training courses under the ITEC programme.
▪ In addition, special courses are underway for personnel of administration, police, border guarding forces, military,
narcotic control officers, teachers etc.

Indian community in Bangladesh

▪ About 10,000 Indian citizens are estimated to be living in Bangladesh. Most are engaged in the Ready Made
Garments (RMG) sector or as professionals in MNCs, Indian or Bangladeshi companies.

CAA – NRC: Recent Irritant in ties

▪ There have been recent irritants in the relationship.
▪ These include the proposed countrywide National Register of Citizens (NRC) and the Citizenship Amendment
Act (CAA) passed in December last year.
▪ Bangladesh had insisted that while the CAA and the proposed nationwide NRC were “internal matters” of
India, the CAA move were “not necessary”.

India’s Bilateral Relations post CAA and NRC:

▪ Triggering these concerns are instances of reverse migration of a few hundred people who have been arrested
after the crossing of the border into Bangladesh. All these people have reportedly declared that they are
‘Bangladeshi Muslims’ and have returned home because they no longer have any hope of getting Indian
citizenship after the CAA came into force.
▪ Bangladesh’s dilemma is an acute one because it has a policy of not acknowledging illegal migration from its
territory into India. There is little doubt that during 2001-2006, when the BNP-Jamaat government was in power
in Bangladesh, there were large scale atrocities against Hindus, resulting in migration into India.
▪ The ground reality is that there is always a flow of migrants into India from Bangladesh, though numbers
have come down. How the Indian government will deal with illegal Muslim migrants who will become
stateless, is the million-dollar question.
▪ Reports of large detention centers being built in Assam has spooked Muslim migrants who find their names in
the NRC, though there are provision for appeal. This fear is aggravated by the talk of having a country wide NRC.
Bilateral ties with Bangladesh are at risk of going downhill, if this issue is not managed with sensitivity.

Recent Development

1. India’s engagement post CAA:

▪ Over the last five months, India and Bangladesh have cooperated on pandemic-related moves.

113
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▪ Hasina supported Modi’s call for a Regional Emergency Fund for fighting Covid-19 and declared a
contribution of $1.5 million in March 2020. India has also provided medical aid to Bangladesh.
▪ The two countries have also cooperated in railways, with India giving 10 locomotives to Bangladesh.
▪ The first trial run for trans-shipment of Indian cargo through Bangladesh to Northeast states under a pact on
the use of Chittagong and Mongla ports took place in July.
▪ Bangladesh gave its readiness to collaborate in the development of a Covid-19 vaccine, including its trial, and
looks forward to early, affordable availability of the vaccine when ready.

2. Border Haat:
▪ India-Bangladesh Border Haat is a border trade market
between Bangladesh and India.
▪ It is a market place organized by the two countries one day each
week. It is not only a market for buying daily commodities but
also a reunion spot for families living on both sides.
▪ Currently, four border haats are operational along the India-
Bangladesh border.
▪ Two border haats are located in Meghalaya at Kalaichar and
Balat and two are located in Tripura at Srinagar and
Kamalasagar.

3. Seven major deals between the two nation:

▪ MoU for providing a coastal surveillance system, Withdrawal of water from Fenni River By India , a new
scheme is proposed for water supply in Sabroom town ,Tripura
▪ MoU between University of Hyderabad and Dhaka on cooperation in youth affairs
▪ Joint declaration on the celebration of Mahatma Gandhi’s birth anniversary (2019) and birth centenary of
Bangabandhu Sheikh Mujibur Rahman (2020) And also 50 years of Bangladesh war of Liberation (2021).

Bangladesh’s unexpected development success

114
Challenges:

▪ India has been facing major problem due to illegal migration of

Bangladeshi people. It has even led to outbreaks of xenophobic
Illegal Immigration violence in certain places of West Bengal and North East.
▪ The centre for Women and Children Studies based in Bangladesh also
reported about Bangladeshi women had been forced into prostitution
in India.
▪ According to the report from International Narcotic Control Board
2007, Bangladesh is the transit point route for drug traffickers from
Cross Border Trafficking Europe to South-East Asia.
▪ Locals are used by drug dealers and mafia to supply drugs, arms and
people across border.
▪ The problem of Illegal Bangladeshi infiltrations has been unresolved
since many decades and the influx is continued till date.
▪ China has increased its influence in Bangladesh by increasing
investment here.

115
 ▪ The Chittagong port of Bangladesh which plays an important role in
China’s Influence China’s BRI initiative, has been handed over to China despite India’s
objection.
▪ Bangladesh takes advantage of being strategically important to both
India and China by flipping sides & thus increasing its bargaining
power.

Rohingya Issue:
▪ There are almost 11 lakh Rohingyas refugees living in Bangladesh. While India has supplied humanitarian aid to
Bangladesh under operation ‘Insaniyat’ for the Rohingya crisis but Bangladesh want India to put pressure on
Myanmar for repatriation of over a million of Rohingyas.
▪ The crisis emerged when Myanmar security personnel in August 2017 were attacked by an underground Rohingya
insurgent group, which led to be as described, ethnic cleansing, genocides.
▪ This led to biggest human migration in recent times and death of atleast 10000 Rohingyas.

▪ World’s most victimize people, 1.1 million Rohingya people live in Myanmar
mostly in Rakhine state.
▪ In Myanmar the Rohingya are Muslim minority who are termed as illegal
Who Are Rohingyas? immigrants, and they are denied from citizenship, freedom of movement, access to
medical assistance, Education and other basic services.
▪ Rohingya are linguistically, ethnically and religiously different from the dominant
Buddhist community of Myanmar.
Myanmar’s stand ▪ Despite of many evidences and international pressure Myanmar continues to
deny its acceptance and counter as a violent insurgent group.
▪ India views Rohingyas as a threat to its national security and links to international
India’s Stand terror groups.
▪ The Citizenship Amendment Bill 2019 which exclude Muslim from its zone and
provide citizenship only to Hindu, Jain, Sikh, Parsi, Christian, And Buddhist
immigrants persecuted in Bangladesh, Pakistan, and Afghanistan. The majority of
Rohingyas are Muslim.
▪ India have asked all state governments to collect and identify the biometric details of
Rohingya refugees living in India.
▪ India have deported few Rohingyas back to Myanmar by handing over them to
Myanmar Authorities.
▪ Recently, India abstained to vote on a resolution backed by Bangladesh in United
Nations Human Right Council, which criticized Myanmar government on the
manner of their dealing of the crisis.
▪ India maintains the stand that Rohingyas will be consuming resources which are
meant for Indian citizens.
▪ Rohingyas may also impact the peace and prosperity of India by providing fuel to
radicalization in India.

Way Forward
▪ India’s attempts to equate Bangladesh to fundamentally theocratic Muslim nations such
as Pakistan and Afghanistan are something that is unacceptable to Bangladeshis, where
Consolidation
religious and racial harmony have always been a priority, unlike in many neighboring
countries so we not need to equate it with Pakistan.
▪ Bangladesh-India relations have reached a stage of maturity. Bilateral ties can be
expected to grow stronger in the future. It is for India to take the lead to remove these Cooperation Coordination

irritants.
▪ There is scope for India-Bangladesh ties to move to the next level, based on cooperation,
coordination and consolidation.
▪ New Delhi must keep up the partnership that allows for economic growth and improved developmental
parameters for both countries.

116
▪ It is important to address specific issues like Teesta and to respond to Dhaka’s call for help on the Rohingya
issue.
▪ Effective border management for ensuring a tranquil, stable and crime free border.
▪ Applications of principle of non-reciprocity of Gujral Doctrine.
▪ Increased people to people contacts and tourism.
▪ Assurance regarding NRC and CAA exercise.

117
 CH-3 INDIA – BHUTAN RELATIONSHIP
• Diplomatic relations between India and Bhutan were established in 1968 with the establishment of a special office
of India in Thimphu.
• The basic framework of India-Bhutan bilateral relations is the Treaty of Friendship and Cooperation signed in
1949 between the two countries and revised in February 2007.
• The Golden Jubilee of the establishment of formal diplomatic relations between India and Bhutan was celebrated
in the year 2018.
• India and Bhutan share a unique and time-tested bilateral relationship, characterized by utmost trust, goodwill
and mutual understanding. The special relationship has been sustained by a tradition of regular high-level
visits and dialogues between the two countries.

Basics and Background

• Government of India has consistently supported the socio-
economic development of Bhutan. Hydro-power
cooperation between the two countries is an example of win-
win cooperation.
• The two countries have been sharing ties since 1910, after
British India made Bhutan its protectorate.
• Buddhist Saint from Bhutan, Guru Padmasambhavna
played influential role for spread of Buddhism between
people of both nations.
• Bhutan was among the first nation to recognize India after its independence.
• When Bhutan emerged which was aloof from rest of the world, India was the first country with which it
established diplomatic relation in 1963.
• For the 12th Five Year Plan, India’s contribution of Rs. 4500 cr. will constitute 73% of Bhutan’s total
external grant component. The key areas of focus of GOI’s assistance include agriculture and irrigation
development, ICT, health, industrial development, road transport, energy, civil aviation, urban development,
human resource development, capacity building, scholarship, education and culture.

118
Strategic Importance
• Bhutan acts as a buffer state between India and China. Its importance can
be inferred from the fact that PM Modi’s first abroad visit was to
Bhutan.
• Bhutan helps in curtailing insurgencies in North East India by making
sure to not provide safe heaven to militant organisations such as United
Liberation Front of Assam (ULFA) and National Democratic Front of
Bodoland (NDFB).
• Bhutan is particularly important for India’s chicken neck corridor,
especially among the ever-growing expansionism of china.
▪ Although Bhutan have huge hydropower potential it need technology for
its development for which India have signed agreements with the country
and developments has been made on this respect.
▪ Bhutan is regarded as India’s all-weather friend as well as a “special
friend”.
▪ Bhutan is our only neighbor which has not joined China’s Belt and Road
Initiative.
▪ The Chinese claims on Ladakh, Nepal, Sikkim, Bhutan and Arunachal
jeopardizes Indian and Bhutanese sovereignty. Thus, for both Bhutan and
India it is imperative to avoid such territorial claims together.
▪ Bhutan is also member of SAARC and integrated part of India’s neighbourhood first policy.

Political Relations
• In 1949, India signed “Treaty of Friendship and cooperation” with Bhutan, under which India was to continue
its guidance over Bhutan’s foreign relations. This treaty was revised
in 2007 after which Bhutan was free from its dependence on India for
foreign relations but its security still needs supervision of India.
• In 2006, India signed an agreement on Cooperation in hydropower,
under which India have so far constructed three Hydroelectric
projects in Bhutan.
• The relation between two countries are strengthened with regular
visits and exchange of views at highest levels.
• Bhutan have rejected China’s Special Package in the past with regard to its territorial disputes with China, as it
might provide threat to India’s chicken neck corridor.

Economic and Trade Relations

• The first Agreement on Trade and Commerce between India and
Bhutan was signed in 1972, which established a Free-Trade
Regime between the two countries. This Agreement has been
renewed five times, the last being on 2016.
• The Agreement also provides for duty-free transit of Bhutanese
exports to third countries, as Bhutan is a land locked country.
• India is Bhutan’s largest trading partner and bilateral trade is
conducted in Indian Rupees which is fully convertible to
Ngultrum at par. India has contributed generously towards
latter’s Five Year Plans since 1961.
• In 2018, bilateral trade reached Rs/Nu. 9228 Cr.
o Imports from India were Rs/Nu. 6011 cr. accounting for 84%
of Bhutan’s total imports. Bhutan’s exports to India stood at
Rs/Nu. 3217 cr (including electricity) and constituted 78 % of its total exports.
o GoI refunds excise duty on Bhutanese imports from India.

Major items of exports and imports with Bhutan are:

Exports to Bhutan Imports from Bhutan

119
Light oils and preparations (Diesel), Ferrous products Electricity, ferrosilicon, Portland cement, dolomite,
obtained by direct reduction of iron ore, Other (Wood carbides of calcium carbides of silicon, cement clinkers,
Charcoal), Motor spirit (gasoline) including aviation timber and wood products, potatoes, cardamom and fruit
spirit (petrol), Dumpers designed for off-highway use, products
etc.

Cultural Relations

• India-Bhutan Foundation was established in August 2003.

• Its aim is of enhancing people to people exchanges in focus areas like
India-Bhutan Foundation education, culture, scientific and technical research and environment
protection.
• The Ambassador of Bhutan and India are the Co-Chairpersons of the
Foundation.
• There are vibrant cultural exchanges between the two countries.
• Nehru Wangchuk Cultural Centre located in Thimphu is filled with cultural
Nehru - Wangchuk Cultural activities around the year.
Centre • Regular classes for Indian classical music, tabla and yoga are being organized
in this centre.
• NWCC also organizes cultural functions, exhibitions, movie shows, seminars
etc.

Bilateral Mechanisms
There are a number of institutional mechanisms between India and Bhutan in areas such as security, border
management, trade, transit, economic, hydro-power, development cooperation, water resources. There have been
regular exchanges at the Ministerial and officials’ level, exchanges of parliamentarian delegations to strengthen
partnership in diverse areas of cooperation.

Importance of Bhutan and India for each other

Developmental/ Infrastructural Projects

Hydropower Cooperation:

• Government of India has constructed three Hydroelectric Projects (HEPs) in Bhutan which are operational and
exporting surplus power to India and rest is used for domestic consumption.

120
• The ongoing cooperation between India and Bhutan in the Hydropower sector is covered under the 2006
Agreement on Cooperation in Hydropower and the Protocol to the 2006 agreement signed in March, 2009.

• Punatsangchhu-II HEP is a 1020 MW run-of-the river project located on Punatsangchhu

Punatsangchhu-II river in Wangdue Phodrang Dzongkhag in Western Bhutan. Its estimated capacity is
HEP 4357 million units of electricity in an average year. Construction of Punatsangchhu-II
HEP commenced in December 2010 . Physical progress of the project as of December
2017 is 72%.
• Mangdechhu HEP is a 720 MW, run-of-the river scheme located on river
Mangdechhu in Trongsa Dzongkhag (District) in Central Bhutan. Annual energy
Mangdechhu HEP generation from the Project with 95% machine availability would be 2925.25 million
units. The bilateral agreement to execute the Mangdechhu Hydroelectric Project was
signed between Government of India and Royal Government of Bhutan on 30th April
2010. Physical progress of the project as of December, 2017 is 90%.
Kholongchhu • Kholongchhu HEP is 600 MW run-of-the-river Project in the lower course of
HEP (Joint Kholongchhu river in Trashiyangtse district of Bhutan. It is the first HEP in Bhutan to
Venture) be implemented under the Joint Venture model, by a JV-company between Druk Green
Power Corporation DGPC) of Bhutan and SJVNL Ltd. of India.

Gross National Happiness Index

Gross National Happiness is a term coined by His Majesty the Fourth King of Bhutan, Jigme Singye Wangchuck
in the 1970s. The concept implies that sustainable development should take a holistic approach towards notions of
progress and give equal importance to non-economic aspects of wellbeing. The Gross National Happiness Index is
a single number index developed from 33 indicators categorized under nine domains. The GNH Index is constructed
based upon a robust multidimensional methodology known as the Alkire-Foster method.

Border Management

• There is a Secretary-level mechanism on border management and security related matters.

• There is also a Border District Coordination Meeting Mechanism between the bordering States and the Royal
Government of Bhutan to facilitate coordination on border management and other related matters.

BBIN Motor Vehicle Agreement

• The BBIN project was conceived when SAARC at its 18th
Summit in Kathmandu failed to sign a SAARC Motor
Vehicles Agreement - chiefly because of Pakistan.
• The sub-regional Motor Vehicle Agreement (MVA) seeks
regulation of passenger, personnel and cargo vehicular
traffic between the four BBIN countries.
• Originally, the project mentioned 30 identified priority
transport connectivity projects with an estimated cost of
over US $8 billion that will rehabilitate and upgrade
remaining sections of trade and transport corridors in the
BBIN countries.
• India, Nepal and Bangladesh have ratified the Agreement
while Bhutan failed to get its Parliament’s nod to ratify the
same. It has some reservations about its environmental impact
owing to increased traffic of heavy- duty vehicles.

Water Resources

• There is a Joint Group of Experts (JGE) on flood management between India and Bhutan to discuss/ assess the
probable causes and effects of the recurring floods and erosion in the southern foothills of Bhutan and adjoining
plains in India and to recommend appropriate measures to both Governments.
• Last meeting of JGE was held in April, 2017 in Thimphu, Bhutan.

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Indian Community

• There are about 60,000 Indian nationals living in Bhutan, employed mostly in the hydroelectric power and
construction industry. In addition, between 8000 and 10,000 daily workers enter and exit Bhutan every day in
border towns.

Educational Projects

• India is the most popular educational destination for Bhutanese students - almost 4000 Bhutanese students are
enrolled in Indian Universities at any time, many of whom are also provided scholarship by Govt. of India.

• Government of India scholarships are granted to Bhutanese students

at Undergraduate level every year to study in prestigious Indian
Institutions of higher learning.
Under Graduate and Post – Graduate • Under this scheme, 450 slots have been approved for Bhutanese
Scholarships students to pursue Under Graduate courses in India.
• GoI also provides several fully funded Post Graduate Scholarships
each year to deserving Bhutanese students in their chosen stream of
studies.
• Prestigious Nehru-Wangchuk Scholarship is being awarded to
deserving and talented Bhutanese nationals to undertake studies in
Nehru-Wangchuck Scholarships selected and premier Indian educational Institutions.
• It was initiated in 2010.
• Ambassador’s scholarship is being awarded to meritorious and
Ambassador’s Scholarship deserving Bhutanese students who are studying in various/colleges
in India on self-financing basis as well as to other suitable
candidates.
• Twenty fully funded slots are provided every year to Bhutanese
students under ICCR Scholarship.
• The Aid-to Bhutan ICCR Scholarship scheme has been
Aid-to-Bhutan ICCR Scholarship implemented in Bhutan from the academic session 2012-13.
• The Scholarship is awarded by Government of India on the advice
of Department of Adult and Higher Education (DAHE), Ministry of
Education, RGoB, based on the merit ranking of the student in Class
XII.
• Every year GoI provides 300 training slots under ITEC programme
ITEC Training Programme Scheme and a further 60 slots under TCS Colombo Plan in various fields to
Bhutanese for upgrading their administrative and technical skills.
• Under this scheme trainees are provided with airfare, tuition fee,
accommodation and living allowance by GoI.

Challenges
• Illegal camps are established by militant outfits in the jungles of South-East Bhutan, which is a cause of concern
for India’s internal security.
• India’s too much interference in Bhutan’s internal affairs is highly criticized by its citizens.
• The recent shift of India towards renewable energy sources have caused a concern for profitability of Bhutan’s
hydropower projects.
• The continuous struggle by China to prove its claims over Chumbi Valley and Doklam and China’s consistent
efforts to establish strong economic and political relations with Bhutan remains a concern for India.

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• BBIN motor vehicles Agreement: It was signed in 2015, including Bangladesh, Bhutan, India And Nepal
(BBIN). Later it was blocked by Bhutan’s upper house citing environmental concerns. Bhutanese government
claimed that this pact will impact the smallest country in south Asia with heavy traffic, tourist and pollution.
Finally, in 2019 the Bhutan government has decided to send the bill for ratification to its upper house.
• Balance of Trade issue: Growing trade imbalance in favour of India lead to Export to Bhutan cheaper and
imports from Bhutan more expensive.
• Another issue is Bhutan’s geographically disadvantaged location that has made its economy hugely dependent
on India, giving India an undue advantage over Bhutan’s trade and commerce.

Positive Steps

• Bhutan government has decided to soon launch the RuPay cards which will further strengthen people to people
relations between the 2 countries.
• Ground station being built by ISRO in Bhutan is expected to complete soon which would benefit Bhutan in
tasks such as weather information, telemedicine and disaster relief in the far-flung areas of the country.

Bottomline
• India and Bhutan have been all weather friends and enjoy exemplary ties of friendship and cooperation,
based on utmost trust, goodwill and mutual understanding at all levels.
• It’s in interest of both nations to review the progress in the multifaceted partnership and iron out any differences in
the fast changing geopolitics of south Asia and the world at large.

Way Forward
• Bhutan is recognized as India’s special friend and India need to maintain good relations with it. For this both
nations should continue their high level dialogues and look for further scope of development.
• Recalibrating the friendship: It has to build Bhutan’s trust on India’s intention by following the treaty in letter
and spirit and not on a chose and pick basis.
• Strategic balancing: Bhutan and India bilaterally should look at all matters of territorial incursions. India needs to
develop a standalone Bhutan policy that is independent of Chinese lens.
• Inclusive Economic ties: India has to make efforts to reduce Bhutan’s debt fears. Operationalisation of the
pending projects can reduce the fears.
• There is no harm in diversifying one’s economy and India should see it as a new opportunity to partner with
Bhutan and help diversify its economy. It should transform its relation from an aid provider to an investment led
developer. Skilling Bhutan’s youth, developing a bilateral tourism policy and increasing private investment
can be helpful for both.

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 CH-4 INDIA – MALDIVES RELATIONSHIP

India was one of the first countries to establish diplomatic relations with the Maldives after it gained
independence in 1965 and the two settled their maritime border in 1976. Both the nation shares friendly and close ties
in strategic, economic, cultural and military cooperation. India contributes to maintaining security on the island nation.

Basics and Background

▪ India and Maldives share ethnic, linguistic, cultural,
religious and commercial links steeped in antiquity.
▪ The Maldives is located south of India’s Lakshadweep
Islands in the Indian Ocean.
▪ India and Maldives officially and amicably decided their
maritime boundary in 1976.
▪ India has supported Maldives’ policy of keeping regional
issues and struggles away from itself.
▪ Maldives occupies a very special place in the ‘Neighborhood
First Policy’ and the ‘SAGAR (Security and Growth for
All in the Region)’ vision of the Government of India.
▪ ‘India First’ has been a stated policy of the Government of
Maldives.
▪ Maldives is an integral part of India’s “neighborhood first
policy”.
▪ Both nations are members of the South Asian Association
for Regional Cooperation (SAARC) and signatories to the
South Asian Free Trade Agreement (SAFTA). During the
first few decades of independence, the bilateral partnership
was limited, although the two did sign a comprehensive trade
agreement in 1981.
▪ However, bilateral relations took their first major step
forward following India’s intervention to crush a coup
against the Maldivian government ‘OPERATION
CACTUS’ in 1988. The Indian armed services quickly
restored order in the archipelago and the Indo-Maldivian
relationship reached a new high.
▪ Since then, India has provided considerable economic
assistance and training in the fields of health, civil society development, infrastructure development, disaster
relief, telecommunications and labour resources.
▪ India has established the Indira Gandhi Memorial Hospital in Male, the capital of Maldives, expanded
telecommunications, air links and increased scholarships for Maldivian students. Indian Navy gifted a Trinket
class Fast Track Attack Craft to Maldives National Defence Force’s Coast Guard.
▪ In the wake of the internal security crises and tensions with Sri-Lanka, Maldives saw its relationship with India as
a source of future security with providing permanently base two helicopters and settling up Radars on all 26
atolls for seamless coverage.

124
▪ Indian Coast Guard Dornier was first to land at the Ibrahim Nasir Airport with relief and supplies after the
Tsunami of December 26, 2004.

Political Relations
▪ India was among the first to recognize Maldives after its
independence in 1965 and to establish diplomatic relations with the
country.
▪ Since then, India and Maldives have developed close strategic,
military, economic and cultural relations.
▪ Except for a brief period between February 2012 to November 2018,
relations have been close, cordial and multi‐dimensional.
▪ Since the establishment of diplomatic relations, almost all Prime
Ministers of India visited the Maldives.
▪ India and Maldives have consistently supported each other in
multilateral fora such as the UN, the Commonwealth, the NAM, and the SAARC.

Strategic Importance
▪ Despite being the smallest Asian country with a land area,
Maldives is one of the world’s most geographically
dispersed countries straddling a 960-km-long submarine
ridge running north to south and which forms a wall in
the middle of the Indian Ocean.
▪ Maldives’ proximity to the west coast of India (it is barely
70 nautical miles away from Minicoy and 300 nautical
miles away from India’s West coast), and its situation at
the hub of commercial sea‐lanes running through Indian
Ocean (particularly the 8° N and 1 ½° N channels)
imbues it with significant strategic importance to India.
▪ The geostrategic importance of the nearly 1,200 islands of
the Maldives as a “most important interstate,” underlines
the importance for New Delhi of positive bilateral relations with Male.

▪ Located at the southern and northern parts of this island chain lies the two
important sea lanes of communication (SLOCs).
▪ These SLOCs are critical for maritime trade flow between the Gulf of
Aden and Gulf of Hormuz in West Asia and the Strait of Malacca in
Southeast Asia.
Maldives, a Toll Gate in Indian ▪ While the Indian Ocean is considered as the key highway for global
Ocean trade and energy flow, Maldives virtually stands as a toll gate.
▪ While SLOCs in the vicinity of the Maldives have broader strategic
significance for global maritime trade, these are of vital importance for
India since nearly 50% of India’s external trade and 80% of her
energy imports transit these westward SLOCs in the Arabian Sea.
▪ At present, India is dependent on oil for more than 90 percent of its
energy needs, and over the next few decades, 90 percent of that oil will
come from the Persian Gulf by way of the Arabian Sea.
▪ Moreover, coal imports from Mozambique, are set to increase
dramatically, augmenting the coal that India already imports from around
the Indian Ocean from countries such as South Africa, Indonesia, and
Australia.
▪ Moreover, such access provides strategic depth in any potential conflict
with China, wherein India could attempt to restrict the flow of oil
through the Indian Ocean to the Malacca Strait.
▪ In recent decades with ever rising maritime economic activity in the Indian

125
 Ocean, the geopolitical complexity too has intensified in the Indian Ocean.
Increasing Maritime Activity ▪ This led to the increase in Chinese presence in the Indian Ocean for
their strategic interests.
▪ India’s Strategic priority is to maintain a favourable and positive maritime
environment in the Indian Ocean.
▪ Beyond refuelling stations, by maintaining access to these ports, the
expanding Indian Navy can safeguard its interests by providing security
India’s Strategic Priority for the sea lines of communication and ensuring vital resources reach
India’s coasts.
▪ Thus, India continuously aims at promoting an ever-expanding area of
peace and stability around it.
▪ Moreover, Maldives is an important partner in India’s role as the net
security provider in the Indian Ocean Region.

Security Cooperation
▪ Through the decades, India has rushed emergency assistance to the Maldives, whenever sought.
▪ In 1988, when armed mercenaries attempted a coup against President Maumoon Abdul Gayoom, India sent
paratroopers and Navy vessels and restored the legitimate leadership under Operation Cactus.
▪ Further, joint naval exercises have been conducted in the Indian ocean and India still contributes to the security
of the maritime island.

▪ India helped Maldivian students during Ukraine crisis to return to their home through its evacuation
operation and provided bottled water through its helicopters to Maldives when its only water treatment
plant collapsed.
▪ India shares very close military ties with Maldives by having two helicopter bases, integration of radars and
Indian Coast Guard surveillance along Maldivian coast.

Disaster Management
▪ The 2004 tsunami and the drinking water crisis in Male a decade later were other occasions when India rushed
assistance.
▪ At the peak of the continuing COVID-19 disruption, the Maldives has been the biggest beneficiary of the Covid-
19 assistance given by India among its all of India’s neighbouring countries.
▪ When the world supply chains were blocked because of the pandemic, India continued to provide crucial
commodities to the Maldives under Mission SAGAR.
▪ Operation Neer was initiated by the Indian government in response to the Maldives government's request for
help after a major fire broke out at the Male Water and Sewerage Company.

SAGAR
▪ Security and Growth for All in the Region (SAGAR) was launched in 2015. It is India’s strategic vision for the
Indian Ocean Region (IOR).

126
▪ Through SAGAR, India seeks to deepen economic and security cooperation with its maritime neighbours and
assist in building their maritime security capabilities.
▪ Further, India seeks to safeguard its national interests and ensure Indian Ocean region to become inclusive,
collaborative and respect international law.
▪ The key relevance of SAGAR emerges when seen in conjunction with India’s other policies impacting the
maritime domain like Act East Policy, Project Sagarmala, Project Mausam, India as ‘net security provider’,
focus on Blue Economy etc.

Mission Sagar

▪ Mission Sagar has been launched as part of the government’s outreach initiative towards five Island
nations in the Indian Ocean amidst the ongoing COVID-19.
▪ Under the mission, Indian Naval Ship Kesari has departed for Maldives, Mauritius, Seychelles, Madagascar
and Comoros, to provide food Items, COVID-related medicines including HCQ tablets and special Ayurvedic
medicines with medical assistance teams.
▪ Also, as part of the mission, INS Kesari would enter the Port of Male in the Republic of Maldives, to provide
them 600 tons of food provisions.

People To People Contact

▪ Technology has made connectivity easier for everyday contact and exchanges.
▪ Maldivian students attend educational institutions in India and patients fly here for super speciality healthcare,
aided by a liberal visa-free regime extended by India.

Economic and Trade Relations

▪ Tourism is the mainstay of Maldivian economy. The country is now a major tourist destination for some
Indians and a job destination for others.
▪ India and Maldives signed a trade agreement in 1981, which provides for export of essential commodities.
▪ Under the bilateral agreement, India provides essential food items like rice, wheat flour, sugar, dal, onion, potato
and eggs and construction material such as sand and stone aggregates to the Maldives on favorable terms.
▪ Given the geographical limitations imposed on the Maldives, India has exempted the nation from export curbs
on essential commodities.
▪ State Bank of India has been playing a vital role in the economic development of the Maldives since, 1974 by
providing loan assistance for promotion of island resorts, the export of marine products and business enterprises.
▪ India is Maldives’ 4th largest trade partner after UAE, China and Singapore.
▪ Indian imports from the Maldives primarily comprise scrap metals while Indian exports to the Maldives
include a variety of engineering and industrial products like drugs and medicines radar apparatus, rock
boulders, aggregates, cement and agriculture produce like rice, spices, fruits, vegetables and poultry
produce etc.

Bilateral trade figures (Jan‐Dec, in US$ million)

Year Total Exports to Maldives Total Imports from Maldives Total Trade
2013 154.0 12.3 153.3
2014 170.6 2.9 173.5
2015 225.82 3.0 228.82
2016 275.5 1.6 277.1
2017 286.94 2.86 289.80
2018 286.18 2.81 288.99
2019 290.27 3.42 293.69

Capacity Building and Skills Development

▪ It is one of the key components of India’s assistance to the Maldives. India offers several scholarships to
Maldivian students under the following schemes:
o ICCR scholarships

127
 o SAARC Chair Fellowship
o ITEC training & scholarships
o Technical Cooperation Scheme of the Colombo Plan
o Medical scholarships
▪ Several Maldivian diplomats have received training in India under the Indian Foreign Service Institute’s
Professional Course for Foreign Diplomats (PCFD) program.

Cultural Relations
▪ Both countries share long cultural links. Exchange of cultural troupes takes place regularly between the
countries.
▪ Three historical mosques (Friday Mosque and Dharumavantha Rasgefaanu Mosque - Male’, Fenfushi Mosque -
South Ari Atoll) were successfully restored by Indian experts from NRLCCP, Lucknow.
▪ Hindi commercial films, TV serials and music are immensely popular in Maldives.
▪ The India Cultural Center (ICC), established in Male in July 2011, conducts regular courses in yoga, classical
music and dance.

Operation Sanjeevani
▪ At the request of the govt. of Maldives, the IAF aircraft activated “Operation Sanjeevani” and lifted these
medicines from airports in New Delhi, Mumbai, Chennai and Madurai before flying to the Maldives.
▪ Among other things, these medicines include influenza vaccines, anti-viral drugs such as lopinavir and ritonavir
which have been used to treat patients with COVID-19 in other countries.
▪ The flights are being operated on commercial basis following demands from pharmaceutical companies and
their intermediaries and will carry cargo on inbound as well as outbound flights.
▪ The cargo operations will help the airline earn some revenue at a time there is a ban on passenger flights and the
entire fleet is grounded.

Why the Maldives is Important for India?

128
▪ Strategic location - In the Indian Ocean, Maldives archipelago comprising 1,200 coral islands lies next to key
shipping lanes which ensure uninterrupted energy supplies to countries like China, Japan, and India.
▪ At the Heart of International Geopolitics - Since China started to send naval ships to the Indian Ocean roughly
10 years ago and right up to the Gulf of Aden in the name of antipiracy operations Maldives' significance has
steadily grown.
▪ Regional Security - As the pre-eminent South Asian power and a 'net security provider' in the Indian Ocean
region, India needs to cooperate with the Maldives in security and defense sectors.
▪ Member of SAARC - It is important for India to have the Maldives on board to maintain its leadership in the
region. The Maldives was the only SAARC country which seemed reluctant to follow India's call for a
boycott of SAARC summit in Pakistan after the Uri attack.
▪ Blue economy - The Maldives has an intrinsic role in advancing blue economy through sustainable management
and utilization of marine resources.
▪ UNSC Support - Maldives has extended its support for India's candidature for permanent membership of an
expanded and reformed UN Security Council. The Maldives also has reiterated support for India's candidature for
a non-permanent seat for the year 2020-21.
▪ Diaspora - There are 25,000 Indian nationals living in the Maldives (second largest expatriate community).
Indian tourists also account for close to 6% of tourists Maldives receives every year.

Challenges

Political Instability
▪ India’s major concern has been the impact of political instability in the neighbourhood on its security and
development.
▪ The February 2015 arrest of opposition leader Mohamed Nasheed on terrorism charges and the consequent
political crisis have posed a real diplomatic test for India’s neighbourhood policy.

Radicalisation
▪ In the past decade or so, the number of Maldivians drawn towards terrorist groups like the Islamic State (IS)
and Pakistan-based madrassas and jihadist groups has been increasing.
▪ Political instability and socio-economic uncertainty are the main drivers fuelling the rise of Islamist radicalism
in the island nation.
▪ Events in West Asia, Afghanistan and Pakistan have also influenced Maldivian radicalisation.
▪ This gives rise to the possibility of Pakistan based terror groups using remote Maldivian islands as a launch
pad for terror attacks against India and Indian interests.
▪ Further, India's concern is regarding how radical Islamist forces have been gaining political influence in the
neighbourhood.

China Angle
▪ China’s strategic footprint in India’s neighbourhood has increased. The Maldives has emerged as an important
'pearl' in China’s “String of Pearls” construct in South Asia.
▪ Given the Maldives's strategic location in the Indian Ocean, there are speculations about China trying to develop
strategic bases in the archipelago.
▪ China will remain an influential player in the Maldives, given its financial leverage over the country.
▪ An estimated 80 per cent of the Maldives’ total debt equivalent to about 25 per cent of gross domestic
product is owed to China
▪ Although Solih and other opposition leaders have vowed to review contracts with China, analysts say the
Maldives may find it hard to wriggle out of even unfavourable commitments made by the previous government
▪ It will not be easy to push aside China’s hard economic power and its “debt-trap” diplomacy.
▪ Given the uncertain dynamics of Sino-Indian relation, China’s potential strategic presence in Maldives remains a
concern.
▪ Also, the Maldives often use the China card to bargain with India.

129
 “String of Pearls”
▪ String of Pearls refers to the Chinese intention to establish a
network in India Ocean Region (IOR) surrounding India.
▪ Each Pearl represents some form of permanent Chinese
military installation in a series of locations along a String.
▪ Recent development of ports around India, in Gwadar,
Hambantota, Sittwe on the Bay of Bengal Coast in
Myanmar etc. are seen as part of a string of pearls.
▪ Although these are commercial ports, the fear is that
these could be easily converted to Naval facilities in case
of a conflict in India.

China in Maldives
▪ China's massive infrastructure projects, including the
development of Hulhule Island and the “Friendship” bridge connecting it to Male.
▪ Chinese companies investments of $1 billion
▪ Chinese companies are exploring tourism prospects in the Maldives, leases to resort islands, and reclamation
projects.
▪ Chinese help during massive water crisis.

Spread of the ISIS in Maldives:

▪ In addition they discussed that shared concerns about terrorism have brought the two countries closer together
after a period of drift. India disclosed a recent visit to Male, the capital of the Maldives, by Syed Asif Ibrahim, a
former chief of the Indian Intelligence Bureau. India is specifically concerned over the spread of the Islamic State
in the Maldives. Maldives has said that it estimates between 50 and 100 of its 300,000 citizens have travelled to
Syria and Iraq to fight for the Islamic State.

Initiatives from India to Strengthen Relations

▪ ‘Project Mausam’ – India’s answer to China’s ‘Maritime Silk Road’.
▪ The India International Institute of Democracy and Election Management (IIIDEM) had conducted training on
Election Management of SAARC Countries including the Maldives.
▪ Indian Prime Minister attended Maldives President Solih’s swearing-in ceremony.
▪ India and Maldives recently signed five MoUs for establishing the Addu Tourism zone in five islands of Addu
atoll.

PROJECT MAUSAM
▪ Project ‘Mausam’ is a Ministry of Culture project to be implemented by Indira Gandhi National Centre for the
Arts (IGNCA), New Delhi as the nodal coordinating agency with support of Archaeological Survey of India and
National Museum as associate bodies.
▪ Project ‘Mausam’ aims to understand how the knowledge and manipulation of the monsoon winds has shaped
interactions across the Indian Ocean and led to the spread of shared knowledge systems, traditions, technologies
and ideas along maritime routes. These exchanges were facilitated by different coastal centres and their
surrounding environs.
▪ Project Mausam functions at two levels:
1. At the macro level, it aims to re-connect and re-establish communications between countries of the Indian Ocean
world, which would lead to an enhanced understanding of cultural values and concerns.
2. At the micro level, the focus is on understanding national cultures in their regional maritime milieu.

India’s concerns vis-a-vis Maldives

130
Recent Developments
▪ India recently announced $1.4 billion financial assistance to the island nation in a bid to bail out its debt-trapped
economy.
▪ India plans to renew its offer to extend the coastal surveillance radar systems (CSRS) project. The CSRS project
was initially established in 2015 with the coastal nations of Mauritius, Seychelles, and Sri Lanka.
▪ Backed by India, Maldives recently became Indian Ocean Rim Association (IORA) Member. Also, it is
helping expedite its inclusion in the Commonwealth again.

FTA between China and Maldives

▪ The first bilateral FTA has been signed by Maldives with China. The Indian Ocean nation had previously
signed the South Asian Free Trade agreement in 2004. This is also Maldives’s first FTA with any country.
▪ Under the FTA agreement, China will exempt its Maldivian imports, mostly fisheries products, from taxes.
Maldives, on its part, would waive tariffs on its Chinese imports. The FTA will “enable exemption of duties
on fisheries products exported to the world’s largest consumer market”.
▪ Maldivian government has extended invitations to establish free trade agreements with countries including Japan,
the United States of America, the United Kingdom and countries of the European Union.
▪ But when talking about FTA with other countries, Maldivian government didn’t mention India. It creates the
sign of how much India and the Maldives have drifted apart.

Implications for India

▪ Increase in presence of aggressive China in South Asia will lead to India’s worry in different spheres.

▪ Maldives does not have an FTA with India. It is not only Maldives first FTA with
any country, but also it is China’s second FTA with any country in South Asia after
Pakistan. China seems to be ready to ramp up the business ties across South Asia.
▪ China has already ongoing negotiations with Sri Lanka, Nepal, and Bangladesh on
Economic sphere: FTA and this agreement with Maldives will help China to negotiate with other
countries diplomatically.
▪ Chinese companies are exploring tourism prospects in the Maldives, leases to resort
islands and reclamation projects.
▪ Maldives political leadership has expressed displeasure over India, so it will
Political sphere: undermine the future prospects of India-Maldives relationship. China leveraged
favourable economic

131
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India – Maldives Relations a model for ties with other neighbours
▪ Personal involvement of the PM on the Indian side and the President on the Maldivian side has been a
crucial factor in the success story so far.
▪ The external affairs ministry deserves credit for speedy implementation and follow-up of projects and
commitments made at the highest level.
▪ Strategic convergence between the two countries was made possible because of the policies of India First and
Neighbourhood First.
▪ Maldives’ own objectives in the Indian Ocean are not very different from our own policy of Security and
Growth for All in the Region. India’s strong commitment to be a net maritime security provider in the region can
be dovetailed with Maldives own desire for maritime security.
▪ The people-centric projects aided by India such as capacity building, ITEC programmes and the crucial health
sector, India is seen by the ordinary people of Maldives as a benevolent and friendly power. The importance of
this aspect cannot be overemphasised.

Way-Forward
▪ Strengthen democratic institutions - It is important to gradually get democratic institutions of Maldives to
function constitutionally, with proper checks and balances. The constitution must also be strengthened to eliminate
room to drift back towards authoritarianism. India, and not China, is in a better position to help the Maldives in
this regard.
▪ Exercise economic leverage prudently - A widening trade deficit with India is one of the major economic
concerns the Maldives has, India could diversify bilateral trade, especially by enhancing its export basket from the
atoll state.
▪ Enhancing trade sphere - India should consider without delay the proposal from its neighbor regarding the
import of diesel, petrol and aviation fuel from India. The India-Maldives Trade Agreement signed in 1981 could
be revisited in the light of current realities.
▪ Encourage Indian private sector - To deepen its engagement in the Maldivian economy it will need to become
more welcoming to investments made by India.
▪ Increasing connectivity - through the establishment of enabling infrastructure.
▪ Encourage people-to-people interactions - In this regard, visas to Maldivian nationals could be further
liberalized, depending on the purpose of the visit for smooth diplomatic relations.
▪ Security front - India has been the net security provider to the Maldives by frequently extending its help in
securing the sovereignty and territorial integrity of the atoll state.

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▪ Cooperation on Climate Change - India can help the Maldives in adapting to climate change. The policy option
for India is to promote a comprehensive and deepen engagement with the Maldives at all levels including on
climate change.
▪ Geographical Proximity - It is effectively an opportunity for New Delhi and Male to strengthen security ties, as
also to work towards greater understanding in their bilateral relationship.

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 CH-5 INDIA – CHINA RELATIONSHIP

Basics and Background

▪ China and India are both ancient civilisations and major developing countries.
▪ India-China historical exchanges date back to many centuries and there is some evidence that conceptual and
linguistic exchanges existed in 1500- 1000 B.C. between the Shang-Zhou civilization and the ancient Vedic
civilization.
▪ During first, second and third centuries A.D. several Buddhist pilgrims and scholars traveled to China on the
historic “silk route”.
▪ Ancient Indian monk-scholars such as Kumarajiva, Bodhidharma and Dharmakshema contributed to the
spread of Buddhism in China. Similarly, Chinese pilgrims also undertook journeys to India, the most famous
among them being Fa Xian and Xuan Zang.
▪ On 1 April, 1950, India became the first non-socialist bloc country to establish diplomatic relations with the
People’s Republic of China.
▪ Prime Minister Nehru visited China in October 1954. While, the India - China border conflict in 1962 was a
serious setback to ties; Prime Minister Rajiv Gandhi’s landmark visit in 1988 began a phase of improvement in
bilateral relations.
▪ In 1993, the signing of an Agreement on the Maintenance of Peace and Tranquility along the Line of Actual
Control (LAC) on the India-China Border Areas during Prime Minister Narasimha Rao’s visit reflected the
growing stability and substance in bilateral ties.
▪ India-China relations, though occasionally showing signs of peace and cooperation, have often been afflicted by
tension and mistrust.
▪ As the only two major developing countries and important representatives of emerging economies, China-India
relations assume global and strategic significance.
▪ The year 2020 marks the year of the 70th anniversary of the establishment of diplomatic relations between
China and India.
▪ It is also China-India Year of Cultural and People-to-People Exchanges, where the two sides agreed to hold 70
celebratory activities to demonstrate the historic connection between the two civilizations as well as their growing
bilateral relationship.
▪ India and China shares the good economic, commercial and the cultural relationship means through the BRICS
nations. New development bank is an initiative taken from the BRICS countries to boost up the trade and bilateral
relations.
▪ Shanghai Cooperation Organization is one of the Eurasian political, economic and militaryorganization and India
became its full member in the 2015.

Political and Diplomatic Relations

▪ The Communist Party of China (CPC) has maintained friendly exchanges with 9 major Indian political parties
including the BJP, Congress and left-wing parties for a long time.
▪ 20 Inter-parliamentary friendship groups have been set up by China and India.
▪ There are 50 dialogue mechanisms between China and India for exchanging views on various topics of bilateral,
regional and global concern.

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▪ The cumulative outcomes of the exchange of high-level visits have added value and substance to our ties.
▪ The two Asian powers have the immense potential to make big contributions to regional peace and
development, by design or accident, themselves been the sources of regional tension and insecurity to some
extent.
▪ Besides their internal dynamics, the interplay of interests and moves of their neighbours, and several external
powers would have significant bearing on the equation and relations between them.

Economy and Trade Relations

▪ Since the beginning of the 21st century, trade between China and India has grown from less than $3 billion to
nearly $100 billion, an increase of about 32 times.
▪ In 2019, the trade volume between China and India was $92.68 billion.
▪ With a combined market of over 2.7 billion people and a GDP of 20% of the world's total, China and India
enjoy huge potential and broad prospects for economic and trade cooperation.
▪ Our trade relationship is grossly imbalanced, coupled with justified grievance about China’s reluctance to
open sectors like IT and pharmaceuticals to Indian companies and its non-tariff barriers.
▪ Our imports from China in 2018-19 amounted to $70.3 billion while our exports to China were $16.7
billion for the same period.
▪ Chinese investments into India since 2014 has changed the nature of the transactional trade relationship.
The sectors involved include manufacturing, infrastructure, energy, automobiles, consumer goods, and
real estate.
▪ Starting 2016, Chinese capital has entered the technology sector through investments and acquisitions
of Indian start-ups. Chinese tech giants Alibaba (in Paytm, Snapdeal, Big Basket, Zomato) and Tencent
(Ola, Flipkart, Byju, Swiggy) are some entrants. Mobile phone company Xiaomi is another big investor
▪ India’s trade deficit with China is estimated to have narrowed to $48.7 billion during the last financial
year, the lowest in five years compared with $53.6 billion a year ago, as imports from across the border
dropped over 7% to $65 billion in 2019-20.
▪ Joint Economic Group led by the Commerce Ministers of both sides.
▪ Development Research Center Dialogue and the Financial Dialogue led by Secretary Department of Economic
Affairs of India and Vice Minister, Ministry of Finance of China.
▪ BCIM Corridor: The 4 countries (Bangladesh, China, India and Myanmar) at present are discussing the
construction of a multi-modal economic corridor passing through 4 countries starting from Kolkata and ending at
Kumming (in Yunnan province in China) passing through Bangladesh, India again (Assam and Manipur) and
Myanmar (Yangon and Mandalay).
▪ Asia Pacific Trade Agreement (APTA) signed in 1975 is the oldest preferential trade agreement between
countries in the Asia-Pacific region. This is the only trade agreement where India and China share common
platform.

Major Exports Major Imports

to China from China
Cotton, Copper Machinery,
and Telecom and
Diamonds/Natu Power-related
ral gems equipment,
Organic
Chemicals, and
Fertilizers.

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Science and Technology

▪ Both nations have held Joint Research workshops on Science and Technology Innovation.
▪ Indian companies have set up IT corridors in China, which help promote China-India cooperation in information
technology and high technology.

Defence

▪ ‘Hand-in-Hand’ joint anti-terrorist exercises to enhance mutual understanding and trust, exchange training
experiences and jointly improve anti-terrorism capabilities.
▪ China-India defence and security consultation to strengthen exchanges and cooperation in the defence field.
▪ India, China sign first ever ‘internal security’ cooperation agreement where both countries will cooperate with
each other in dealing with terrorism, smuggling of arms, drugs and human trafficking. India also asked China to
support its efforts to get Masood Azhar designated as a global terrorist at UN and not to give shelter to ULFA
leader Paresh Baruah.

People-to-People Exchanges

▪ Both nations have held meetings of China-India High-Level People-to-People and Cultural Exchanges
Mechanism. The two sides have made new progress on exchanges and cooperation in the fields of art, publishing,
media, film and television, museum, sports, youth, tourism, locality, traditional medicine, yoga, education and
think tanks.
▪ Sessions of China-India High Level Media Forum and China-India Think Tank Forum were held to
strengthen exchanges and cooperation in the field of media and think tanks.
▪ The two countries have established pairs of sister cities and provinces. For example, sister provinces and cities
between Fujian Province and Tamil Nadu State, Quanzhou City and Chennai City.
▪ The number of Indian pilgrims to Xizang Autonomous Region of China has surged from several hundred in
the 1980s to more than 20,000 in 2019.

Cultural Relations

▪ As a mark of the historical civilizational contact between India and China, India constructed a Buddhist temple in
Luoyang, Henan Province, inside the White Horse Temple complex which was said to have been built in honour
of the Indian monks Kashyapa Matanga and Dharmaratna.
▪ In June 2008, joint stamps were released, one stamp depicting the Mahabodhi temple at Bodhgaya and the
other depicting the White Horse temple at Luoyang.
▪ Indian Bollywood movies were popular in China in the 1960s and 1970s and the popularity is being rekindled in
recent times again. India and China have entered into an agreement on co-production of movies, the first of which
based on the life of the monk Xuan Zang that hit the theaters in 2016. Many recent Bollywood movies like Three
Idiots, Dangal, Secret Superstar, Bajrangi Bhaijan, Hindi Medium, Toilet – Ek Prem Katha and Andhadhun have
become super hits in the Chinese boxoffice.
▪ Yoga is becoming increasingly popular in China. China was one of the co-sponsors to the UN resolution
designating June 21 as the International Day of Yoga.
Education and Academic Relations

▪ India and China signed Education Exchange Programme (EEP) in 2006,

which is an umbrella agreement for educational cooperation between the
two countries. Under this agreement, government scholarships are
awarded to 25 students, by both sides, in recognized institutions of
higher learning in each other’s country.
▪ In order to further academic exchanges, a Centre for Indian studies was
set up in Peking University in 2003. Chairs of Indian Studies/Hindi have also been established in Shenzhen
University, Jinan University, Fudan University, Guangdong University and in Shanghai International Studies
University.

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Area of Conflict

Border Disputes
▪ One in a region called Aksai Chin and another in a region called Arunachal Pradesh. Both nations claim both
regions although China controls the former and India the latter. In both these places the geography favors the
current arrangement. With both nations nuclear armed, it is inconceivable for any solution other than formalizing
the status quo.
▪ When Prime Minister Narendra Modi visited China in May 2015, one of his objectives was to persuade the
Chinese leadership to restart discussions on the clarification of the Line of Actual Control (LAC) through the
exchange of maps.
▪ The rationale for India’s demand was that, pending a final settlement of the border question, LAC clarification
would help ease border tensions. But the Chinese leadership was not enthusiastic about India’s proposal. Instead,
China called for a comprehensive ‘code of conduct’ for the forces deployed along the border. Here, it is useful to
remember that both LAC clarification and Confidence Building Measures (CBMs) are part of the agreed
principles in the 2005 agreement.
▪ However, in the Wuhan (2018) and Mahabalipuram (2019) summits, both China and India had reaffirmed that
they will make efforts to “ensure peace and tranquility in the border areas”.
▪ This mismatch in desired outcomes was the main obstacle in the recent border talks, and it showed once again
India and China’s contrasting approaches to border negotiations at large.
▪ India’s reluctance to consider a ‘code of conduct’ suggests that it entertains reservations about agreeing to
restrictions on its plans for infrastructure development in the border region.
▪ Perhaps, this reluctance is because of two inferences. One, that the Chinese proposal is aimed at limiting India’s
military and infrastructure modernisation, and thereby enabling China to preserve its military advantage in Tibet.
And two, accepting the Chinese proposal could potentially curtail the ability to effectively patrol and intercept
PLA movements in territory claimed by India.
▪ Doklam and the disputed border between the two countries remains an issue of concern.
▪ In June 2020, violent clashes took place between Indian and Chinese soldiers at the Galwan valley and
Pangong Tso Lake in Ladakh along the Line of Actual Control (LAC), with reported casualties on both sides.
▪ The Indian position on the Sino-Pakistan understanding on Chinese activities in PoK has been consistent. There
are often debates in India-mostly episodic and lacking vigour-about Sino-Pakistan relations.
Domination of Indian Ocean
▪ China has been accused of pursuing strategic maneuvers on a well-thought
out route encircling India in the Indian Ocean.
▪ Beijing has been reaching out to India’s neighbors on the premise of
development and trade, allegedly recreating the Silk Route. From Nepal in
the south east to Myanmar, Bangladesh to Sri Lanka in the south and
Pakistan in the west, China plans to choke India diplomatically.
▪ There are diplomatic visits, courtesy calls, exchange of gifts and promises
between Mr. Modi and the heads of all of the surrounding countries, to not
just counter the Chinese influence but also strengthen the Indian presence.
Tibet and Dalai Lama
▪ This led to the first ever war between these two nations. China is very sensitive about the territorial sovereignty
and having Dalai Lama run a shadow government in India has historically been a major irritator for them.
▪ India's support for the Dharamasala regime is a huge issue for China, but not even headline-worthy for India.
Water Dispute
▪ The dispute between India and china is mainly regarding the Brahmaputra
River flowing through the two countries.
▪ The search for water resources in China and India has persistently been a
source of tension between the two countries.

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▪ Chinese efforts to divert the water resources of the Brahmaputra River away from India will worsen a situation
that has remained tense since the 1962 Indo-China war.
▪ The melting glaciers in the Himalayas as a result of accelerating global climate change will have a dramatic effect
on this river’s water supply. This will increase water scarcity as well as the likelihood of floods, impact agrarian
livelihoods and strain the fragile equilibrium between the two Asian giants.
Pakistan factor
▪ The long-time "all-weather friendship" between China and Pakistan, rooted in a time when both countries were
deeply mistrustful of India, has long made a serious concern for New Delhi.
▪ The relationship has mainly gone one way, with China providing economic assistance and political backing to
Pakistan.
▪ Islamabad is also anxious for an alliance it can use to balance the growing economic and political clout of India.
▪ But Pakistan also offers China a gateway to South Asia, Iran and the Arabian Sea, one of the economic
beltways that President Xi Jinping has sought to build through the region.
▪ China is giving 8 submarines to Pakistan, building 2 nuclear power plants in Karachi. Instability in Pakistan,
Pakistan’s posture towards India puts questions on legitimate use of such investments.
South China Sea issue and India
▪ China opposes India’s oil exploration in the SCS (which has been undertaken at Vietnam’s request) by calling the
area of exploration a ‘disputed’ area and asserting ‘Chinese sovereignty’ over the SCS in the ‘historical’ context.
▪ It has been continuously expressing its reservation in this
regard in the last few years, and sometimes quite belligerently
at that. India has taken note of the Chinese reservation and has
carefully gone ahead in signing a few agreements with
Vietnam for oil exploration in the SCS. These exploration
fields are very much within the maritime space under the
actual control of Vietnam.
▪ Though India is not a direct party in the South China Sea
dispute and in best of its interest it may like to have an
amicable relationship both with China as well as ASEAN
nations.
▪ India’s stand on South China Sea as follows:
o The South China Sea is not China’s sea but a global common.
o It has been an important sea-lane of communication since the very beginning, and passage has been
unimpeded over the centuries.
o Indians have sailed these waters for well over 1,500 years — there is ample historical and archaeological
proof of a continuous Indian trading presence from Kedah in Malaysia to Quanzhou in China.
o Nearly $200 billion of Indian trade passes through the South China Sea and thousands of our citizens study,
work and invest in ASEAN, China, Japan and the Republic of Korea.
o India’s stakes in the peace and security of this region in common with others who reside there, and freedom
of navigation, as well as other normal activities with friendly countries, are essential for our economic well-
being.
o India have historical rights established by practice and tradition to traverse the South China Sea without
impediment.
India’s entry into the UNSC and the NSG

▪ China has been opposing India’s entry into the United Nations Security Council (UNSC) and in the Nuclear
Supplier’s Group (NSG)

India’s opposition to the OBOR

▪ India has been opposing China’s flagship ‘One Belt One Road’ (OBOR) initiative’, as the ‘China Pakistan
Economic Corridor (CPEC)’, a part of OBOR, passes through the Pakistan Occupied Kashmir (POK) and
acceding to OBOR would mean undermining India’s sovereignty.

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Strengthening of India-USA relations

▪ China is critical of India-USA relations and it is not merely a coincidence that the escalation at the tri-junction
coincided with the Indian Prime Minister’s visit to the United States.
▪ India supports the US and other countries in reaffirming the freedom of navigation in international waters,
which includes the South China Sea.
▪ Along with this, the ‘MALABAR Naval exercise’ between India, Japan and USA is also a matter to worry for
China.
▪ Recently formed Quad Group which consist of USA, India, Australia and Japan is perceived by China as Anti-
China Front

Maritime Silk Route project

▪ Beijing’s plan for a maritime infrastructure corridor in the broader Indo-Pacific region, first proposed by
President Xi Jinping’s during his trip to Southeast Asia in October
2013, has attracted attention because of its potential to establish a
Chinese foothold in the Indian Ocean. Needless to say, China’s outreach
to India - inviting it to join the project - has generated much analytical
curiosity.
▪ The first thing of interest about the MSR is that it was initially mooted
as an ASEAN-centered project. The intention then was to enhance
connectivity and cultural links in China’s strategic backyard-the South
China Sea.
▪ Beijing later expanded the scope of the project to include the Indian Ocean, but in reaching out to Sri Lanka and
India, it found a willing partner only in the former. India has been ambivalent about the MSR and is yet to make
up its mind on joining the project.
▪ The problem with the MSR, essentially, is the ‘opaque’ nature of its proposal. Outwardly, the project is about
the development of massive maritime infrastructure and connectivity in the Indian Ocean and the Western
Pacific. Beijing has been careful to project the MSR as an exclusively commercial venture, trying hard to dispel
any impressions of it being a cover for maritime military bases.
India – China informal Summits

Wuhan summit

▪ The first informal meet between the leaders was held at Wuhan, China in April 2018. The leaders exchanged
views on issues of bilateral and global importance.
▪ The simultaneous emergence of India and China as two large economies has implications in regional and
global significance.
▪ The summit was to address the imbalances created in the process.
▪ They agree that proper management of the bilateral relationship will be conducive for the development of the
region.
▪ They also discussed about terrorism, disaster risk reduction, combating diseases, addressing climate change,
etc.
▪ Hopes raised at the Wuhan Summit that the two countries would jointly work together on an economic project
in Afghanistan have proved to be evanescent. Instead, even as the political situation in Afghanistan deteriorates,
China, along with countries like Pakistan, remains more intent than ever on ensuring that India has no role to play
there.

Mamallapuram Summit

▪ The Indian Prime Minister Narendra Modi and his Chinese counterpart Xi
Jingping attended the second edition of informal summit between India and
China in Mamallapuram.
▪ 'Sister-state relationship' between Tamil Nadu and Fujian Province.
▪ The first one was held at Wuhan, Hubei, in April 2018, which was considered

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 the flashpoint that revived ties between the neighbours after the Dokalam standoff.
▪ The meeting assumes greater significance as the trade war between the US and China has been escalating in the
recent times.
▪ The meeting is also likely to help Mamallapuram become a must visit place for Chinese tourists, who mostly
visit Bodhgaya
▪ India clearly viewed this ‘informal summit’ as a trust-building exercise, hoping to quietly sort out problems
that existed between the two countries, including the vexed border issue.
▪ It will help in a strong relationship and better communication, between the two countries.
▪ Such strategic communication will have a positive influence on enhancing mutual understanding and will
contribute to regional and global stability.

India - China Strategic Economic Dialogue

▪ India hosted the 6th India-China Strategic Economic Dialogue in New Delhi.
▪ It is a bilateral dialogue platform between the planning bodies of India and China- the Planning Commission
of India (now NITI Aayog) and the National Development and Reform Commission (NDRC) of China.
▪ The idea of having such a dialogue was first floated by Premier Wen Jiabao on his visit to India in 2010.

Recent India-China Conflict in Ladakh

▪ Rekindling tensions over boundary claims, Indian and Chinese troops have
clashed at two points along the Line of Actual Control (LAC) recently, leaving
personnel injured on both sides.
▪ After the first round of talks on 6th June, 2020, clashes occurred in Galwan
Valley (Ladakh) that claimed 20 Indian soldiers’ lives and an unknown number
of casualties on the Chinese side.
▪ While faceoffs and standoffs keep occurring on the LAC due to differences in
perception on the alignment, there has been no instance of firing on the LAC
since 1975.

India’s Response

Military

▪ India has moved in additional divisions, tanks and artillery across the LAC to match Chinese deployments.
▪ Further, India has approved the purchase of 33 Russian fighter jets and upgrades to 59 war planes at a cost of Rs.
18,148 crore.

Economic

▪ Citing the “emergent nature of threats” from mobile applications, including popular ones of Chinese origin such
as TikTok, ShareIt, UCBrowser, and Weibo, the government has banned 59 apps.
▪ Further, India’s trade deficit with China fell to $48.66 billion in 2019-20 on account of the decline in
imports. The trade deficit stood at $53.56 billion in 2018-19 and $63 billion in 2017-18.
▪ However, the tensions on the border, as well as the Covid-19 pandemic, have thrown light on India’s economic
dependencies on China.
▪ India remains reliant on Chinese products in several critical and strategically sensitive sectors, from
semiconductors and active pharmaceutical ingredients to the telecom sector, where Chinese vendors are involved
not only in India’s 4G network but in on-going 5G trials as well.
▪ Foreign Direct Investment (FDI) from China in India has dipped to $163.78 million in 2019-20 from $229
million in 2018-19.
▪ In April 2020, the Indian government tightened FDI norms coming from the countries which share land
borders with India. Government approval has been made mandatory.

Panchsheel: Relevance in current situation

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In 1954, India and China agreed on five principles of peaceful co-
existence. These principles are: Agreements and initiatives to resolve border
1. Equality and cooperation for mutual benefit disputes
2. Peaceful coexistence
3. Mutual non-aggression ▪ Shimla agreement 1914- McMahon line was
4. Mutual non-interference in each other’s internal affairs established and was accepted by Tibet and
5. Mutual respect for each other’s territorial integrity and British Indian authorities. Chinese authorities
sovereignty have been against this from 1914 till today as
However these were abandoned during the Indo-China war 1962. they believe that Tibet was not a sovereign
authority with no power to conclude any
Relevance: treaties.
▪ Experts believe that these principles have priceless ▪ Panchsheel agreement 1954- It was a pact to
importance for the bilateral relations because of its emphasis respect each other’s territorial boundaries
on non-use of power and tolerance. and sovereignty but since 1962 China has
▪ India’s stand: rarely honoured the agreement.
• India is following these principles since it has been ▪ 1989 CBM- Confidence Building Measure
signed in letter and spirit. Example- India accepted Tibet policy was aimed to settle disputes mutually
as an integral part of China. and peacefully.
▪ Line of Actual Control- India considers Aksai
▪ Territorial integrity: chin as a part of India and China as theirs,
• China is persistently claiming Arunachal Pradesh, raising both of them follow a different line of control
objections to high level visit to Arunachal Pradesh. but in 1993 PM Narasimha Rao agreed to
• China also refuses to accept Sikkim as a part of India. maintain peace along LAC which separates
• China led CPEC project passing through POK, despite Jammu and Kashmir from Aksai Chin.
India’s reservations. ▪ 2003 Principles for Relations &
Comprehensive Cooperation- It was a three-
▪ Non-interference- step process where both sides prepared their
• It is alleged that China is funding Maoists and North East maps and exchanged for each other’s
insurgents. approval. China accepted India’s authority
• China’s indirect interference in India through Pakistan over Sikkim.
and Nepal. ▪ CBM in 2005- Both nations agreed to
implement modalities in CBM along LAC.
▪ Non-Aggression:
• It was violated in 1962 war.
• Recent stand-offs like Doklam, Ladakh.

China talks of its relevance just to drive attention away from the Chinese threat. India might face heavy losses if it
follows the Panchsheel blindly while dealing with China.
Thus looking at the current situations like Ladakh stand-off, China’s aggressiveness over pandemic, the Panchsheel
somewhat has lost its relevance. Thus we need to review the principles according to the changing circumstances.

Way Forward

▪ The countries need to stick to the 2005 protocol and the 2013 Border Defence Cooperation Agreement.
▪ On 1st April, 2020, India and China completed their 70 years of diplomatic relations. Both sides should
acknowledge that the situation is precarious, and that the recent days in particular have undone decades of
painstakingly negotiated confidence-building mechanisms.
▪ For India, the first priority has to be to restore the status quo ante at the border as it existed in April. This
will require both a display of military strength at the border by standing up to Chinese aggression, and diplomatic
work by making it clear to China that its intervention will lead to heavy costs across all spheres of the relationship.
▪ Regional disputes should be resolved through dialogue and consultation.
▪ India cannot afford to sever all its economic links with the world’s second-largest economy, even in the digital
space. Chinese finance will help in sustaining India’s start-up economy.

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▪ However, through Atmanirbhar Bharat Abhiyan, India can try to replace chinese products with domestic
products in the sectors where it is possible. Further, it needs to boost up its economic relations with other
countries.
▪ The two sides can strengthen cooperation under the WTO framework, jointly safeguard the legitimate rights
and interests of developing countries.
▪ India needs to suggest ways and means to prevent Pakistan from intruding in its relationship with China.
▪ Both need to identify roadmaps to address the burgeoning trade deficit favouring China.
▪ People to people contact, tracing the work of Chinese traveller Huen zang and Indian counterpart Kashyap
Matenga in relation with Buddhism.
▪ A strong India-China relationship is important not only for the mutual benefit of the people of India and
China, but also for the region and the world.

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 CH-6 INDIA – NEPAL RELATIONSHIP

Basics and Background

▪ India and Nepal as a close neighbor share unique ties of
friendship and cooperation characterized by an open border Treaty of Peace and Friendship of 1950
and deep-rooted people-to-people contacts of kinship and ▪ The treaty talks about reciprocal
culture. treatment of Indian and Nepali citizens in
▪ There has been a long tradition of free movement of people the two countries, in residence, property,
across the border. business and movement.
▪ The India-Nepal Treaty of Peace and Friendship of 1950 ▪ It also establishes national treatment for
forms the bedrock of the special relations that exist between both Indian and Nepalese businesses (i.e.
India and Nepal. once imported, foreign goods would be
▪ Nepalese citizens avail facilities and opportunities on par treated no differently than domestic
with Indian citizens in accordance with the provisions of the goods).
Treaty. Nearly 8 million Nepalese citizens live and work in ▪ It also gives Nepal access to weaponry
India. from India.

Historical Ties
▪ Nepal that lies in the north of India is a significant neighbour of India and due to the wide range of geographic,
historical, cultural and economic ties Nepal occupies a vital position in India’s foreign policy.
▪ In terms of religion, both India and Nepal share similar ties in Hinduism and Buddhism.
▪ Besides sharing an open border and unhindered cross border movement of people, both the nation also shares a
close bonds or Roti-Beti ka Rishta, through marriage and familiar linkages.

Strategic Importance
▪ Nepal shares a border of over 1850 km with five Indian states
– Sikkim, West Bengal, Bihar, Uttar Pradesh and
Uttarakhand.
▪ Importance for India can be studied from two different
angles:
1. Their strategic importance for India’s national security;
and
2. Their place in India’s role perception in international
politics.
▪ Nepal is situated in the centre of India’s ‘Himalayan
frontiers’, and along with Bhutan it acts as northern
‘borderland’ flanks and acts as buffer states against any
possible aggression from China.

Trade and Economic Relations

▪ India is Nepal’s largest trade partner as well as the largest source of foreign investments.

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▪ India also provides transit for almost the entire third-country trade of Nepal. Nepal uses Kolkata port for its sea
trade.
▪ Indian companies also engage in various economic activities in Nepal. There is Indian presence in their
manufacturing, power, tourism and service sector among others.

Exports from India Imports from Nepal

Petroleum products, vehicles & spare parts, M.S. billet, Juice, oil cakes, jutes goods, handicrafts, noodles,
Other Machinery & parts, cement, Rice, Medicine, Hot woollen carpet, cardamom, readymade garments,
rolled Sheet in coil, Agri equipment and electrical polyester yarn and tea.
equipment.
Exports to Nepal in India increased to 39.48 INR Imports from Nepal in India increased to 5.06 INR
Billion in September from 32.71 INR Billion in August Billion in September from 4.03 INR Billion in August
of 2020 - Reserve Bank Of India of 2020 - Reserve Bank Of India.

Connectivity
▪ The biggest disadvantages of Nepal are that it is landlocked and has difficult terrain. It is difficult for it to
create connectivity towards the north (Tibet) due to the lofty Himalayas.
▪ In this context, India plays a crucial part, being the gateway of Nepal to the world with open borders and
connectivity initiatives enhancing people-to-people contact and economic growth and development.
▪ Linking Sagarmatha (Mt. Everest) and Sagar (Indian Ocean), developing inland waterways to enhance the
movement of Cargo and provide access to the sea.
▪ Developing railway connectivity – to link Kathmandu and Raxaul (Bihar).

Development Assistance
▪ Government of India provides development assistance to Nepal, focusing on creation of infrastructure at the
grass-root level.
▪ The areas of assistance include infrastructure, health, water resources, and education and rural & community
development.

Education
▪ Over the years, India’s contribution to the development of human resources in Nepal has been one of the major
aspects of bilateral cooperation.
▪ Government of India provides around 3000 scholarships/seats annually to Nepalese nationals for various
courses at the Ph.D/Masters, Bachelors and plus–two levels in India and in Nepal.
▪ These scholarships cover a wide spectrum of subjects including engineering, medicine, agriculture,
pharmacology, veterinary sciences, computer application, business administration, music, fine arts, etc.

Cultural ties
▪ Hinduism and Buddhism have served India’s soft power in Nepal. Lumbini is part of the Buddhist circuit
being developed.
▪ India has sister city agreements with Nepal:
o Kathmandu-Varanasi
o Lumbini-Bodhgaya
o Janakpur-Ayodhya
▪ Apart from these initiatives promote people-to-people linkages in the area of art & culture, academics and
media with different local bodies of Nepal.

Defence Ties
▪ India trains and equips the Nepalese Army and assist in its development in modern lines.
▪ According to the 1950 friendship treaty, Nepal can buy arms from India.
▪ The joint military exercise of India with Nepal is known as “Surya Kiran”.
▪ The Gorkha Regiments of the Indian Army are raised partly by recruitment from hill districts of Nepal.
Currently, about 32,000 Gorkha Soldiers from Nepal are serving in the Indian Army.
▪ Since 1950, India and Nepal have been awarding each other’s Army Chief with the honorary rank of General in
recognition of the mutual harmonious relationship between the two armies.

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Disaster Management
▪ Nepal is frequently prone to natural disasters such as earthquakes, landslides and avalanches, cloudbursts and
flash floods. This is mainly due to geographical factors that Nepal lies in a fragile zone (Himalayas – suture line
of Indo-Australian and Eurasian plates).
▪ India provides assistance both in terms of personnel aid, technical aid and humanitarian assistance in such
instances.
▪ India helped Nepal in earthquake of April 2015 by launching operation maître (rescue & relief operations);
pledged $2 billion for the redevelopment of Nepal.

Multilateral Ties
▪ India and Nepal share space on several multilateral forums such as BBIN (Bangladesh, Bhutan, India, and Nepal),
BIMSTEC (Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation) NAM, and
SAARC (South Asian Association for Regional Cooperation) etc.

Pancheswar Dam Project – Water Cooperation

▪ It is a bi-national project aimed at energy production and
augmenting irrigation in India and Nepal. Other Important Projects between the
▪ It is proposed on river Mahakali (known as river Sharda in two countries-
India), where the river forms the international boundary between ▪ Kamla and Bagmati Multipurpose
Nepal and State of Uttarakhand in India. Projects
▪ A Treaty known as “Mahakali Treaty” concerning the ▪ Sapta-Kosi High Dam Project and SUN
integrated development of the Mahakali River, which included Kosi storage cum diversion scheme
Sharda barrage, Tanakpur barrage and Pancheshwar Dam ▪ Karnali Multipurpose Project
Project, was signed between the Nepal and India in 1996.

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Madhesi Issue
▪ In 2015, the Madhesis, the Janajatis and the Tharus, who are considered as the marginalised groups, felt they
were being left out in the newly promulgated Constitution.
▪ These groups, Madheshis in particular, blockaded the border points for 135 days. More than 50 people were
killed in protest-related violence.
▪ The Nepal government called it an undeclared blockade by India, it systematically raised the anti-Indian
nationalism sentiment; and it tried to cozy up to China and use it as an alternative source of supplies.
▪ At the height of the blockade, as critical fuel supplies from India were choked off, Nepal turned to China and
signed an MoU with the China National United Oil Corporation to import petroleum products.
▪ Before this, Nepal had relied exclusively on India for its energy needs.
▪ India usually sends Nepal about 100,000 tonnes of fuel every month, including diesel, kerosene and LPG.

India – Nepal Fuel Pact

▪ The renewed agreement is an umbrella document between the two parties
which apart from detailing the supply of petroleum, oil and lubricant
products and also puts in place an institutional mechanism for cooperation
in the areas of additional services and technical assistance between the two.
▪ India also agreed to extend the proposed Raxaul-Amlekhganj product
pipeline to Chitwan with the promise to start work on the pipeline in
2017-18. The project has been hanging since 2006 with Nepal willing to
bear the expenses and IOC providing technical help.
▪ An announcement is also made to form a high-level official committee to
look into Nepal’s demand for a LPG pipeline from Motihari to
Amlekhganj as well as extending the natural gas pipeline from Gorakhpur
into Nepal.

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Bridge over Mechi River
▪ The Union Cabinet approved a MoU to be signed between India and Nepal for laying down implementation
arrangement on Cost sharing, Schedules and
Safeguarding issues for starting construction of a new Mechi River
Bridge over Mechi River at Indo-Nepal border. ▪ Mechi is a trans-boundary River that originates
▪ The new bridge is part of up-gradation of the in the Mahabharat Range in Nepal.
Kakarvitta (Nepal) to Panitanki Bypass (India) ▪ It enters Indian state of Bihar to
covering a length of 1500 meters including a six lane join Mahananda River.
approach road of 825 meters. ▪ The Mechi originates in the Mahabharat Range
▪ Mechi Bridge is the ending point of Asian Highway 02 in Nepal.
in India leading to Nepal and provides critical ▪ It flows through Nepal, forms the boundary
connectivity to Nepal. between India and Nepal and then flows
▪ The cost for the construction will be borne by GOI through the Indian state of Bihar to join the
through Asian Development Bank (ADB) loan. Mahananda in Kishanganj district.
▪ National Highway and Infrastructure Development
Corporation (NHIDCL) under Ministry of Road
Transport & Highways has been designated as the implementing agency for this project.
▪ The construction of the bridge will improve regional connectivity and has potential to strengthen cross border
trade between both the nations and cementing ties by strengthening industrial, social and cultural exchanges.

Kosi - Mechi River Interlinking Project

▪ The Centre has approved the Rs 4,900 crore project for interlinking of Kosi and Mechi rivers of Bihar.
▪ This is the second major river interlinking project in the country to be approved after the Ken-Betwa project
in Madhya Pradesh.
▪ Bihar has got the final remaining mandatory techno- administrative approval for the project from the MoEFCC.
▪ The central government has approved construction of 76.20 km canals on eastern bank of Kosi for irrigation
purpose, the minister said.
▪ Being a green project, it will not displace people nor require acquisition of forest land. The total land requirement
is about 1,396.81 hectares.

Benefits of the project:

▪ The project will not only prevent recurring floods in north Bihar, but also irrigate over 2.14 lakh hectares of
cultivable land in Araria, Purnea, Kishanganj and Katihar districts, collectively called Seemanchal region.
▪ The project is aimed at alleviating hardships of the people resulting from the floods and has the potential to
usher in a green revolution in Seemanchal region.
▪ This project will provide a diversion to the surplus water of Kosi River through existing Hanuman Nagar
barrage to Mechi River of Mahananda basin.
▪ Mechi River will get water from another source and it will become a vast natural resource of irrigation.
▪ There are no national parks, wildlife sanctuaries or eco-sensitive zones within 10 km radius of the project.

Move for a national project:

▪ Bihar is pitching the river interlinking project for the national project & status and in that case the majority
funding of the project will be borne by the Centre.
▪ The fact that the entire command area is contiguous to Indo-Nepal international boundary is a critical aspect
that the Government of India would likely take special note.

Nepal’s Withdraw from BIMSTEC Military Exercise

▪ Nepal’s decision shows that it is not completely on board with Indian efforts to promote defense and security
cooperation with BIMSTEC nations.
▪ The situation is worrisome, especially in context of India’s renewed effort to revive BIMSTEC as a vibrant
regional collaboration against SAARC which has Pakistan’s participation.

India- Nepal military relationship:

Nepalese citizens serve in the Indian Army, mainly in the Gorkha Regiment, where they can rise to 3-star level.
Currently, over 30,000 Nepalese Gorkhas are serving in Indian army’s seven Gorkha Rifle and other paramilitary
forces. The chief of the Indian Army is also the honorary chief of the Nepalese army and vice versa. Two armies

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regularly conduct bilateral military exercise, known as “Surya Kiran”, every 6 months alternatively in India and
Nepal.

2+1 Dialogue Mechanism

▪ China has proposed a new dialogue mechanism with Nepal that would also involve India.
▪ Two Plus One format for dialogue as proposed is different from a trilateral mechanism. Under the Chinese
proposal, China and India can jointly conduct a dialogue with a third regional country i.e. it is not
▪ Nepal specific and can be applied to any other country in South Asia.
▪ This was announced after the Wuhan Summit, which was an informal summit between India and China.

India – Nepal Integrated Check Post

▪ India Nepal recently inaugurated 2nd integrated check post at Jogbani (Bihar)– Biratnagar (Nepal). The first
was at Raxaul, Bihar.
▪ ICPs are envisaged to provide all the facilities required for smooth cross-border movement of individuals, vehicles
and goods under an integrated complex.
▪ It has integrated 3 main border related functions - customs, immigration and border security.

Operational ICPs
▪ Attari in Punjab (Pakistan border),
▪ Petrapole in West Bengal (Bangladesh border),
▪ Akhaura in Tripura (Bangladesh),
▪ Raxaul in Bihar (Nepal),
▪ Jogbani in Bihar (Nepal),
▪ Moreh in Manipur (Myanmar).

India – Nepal Cross border Cooperation:

▪ Nepal’s Armed Police Force (APF) has assured India, cooperation in checking doubtful
"third country" operatives on its soil.
▪ The decision was inked during the fourth India-Nepal coordination meeting held
between Indian border guarding force Sashastra Seema Bal (SSB) and its Nepalese
counterpart Armed Police Force (APF) at Pokhara, Nepal.
▪ This is for the first time that the joint record of discussions had a special mention of
'third country' operatives.
▪ With this, not only terrorist elements from Pakistan and other countries, but smugglers and
fake Indian currency notes (FICN) mafia can also be better checked along 1,751-km
long open India-Nepal border.

India Exploring Air Bubble agreement with Nepal

▪ India has an air bubble agreement with 22 countries globally. Within South Asia, India has an air bubble
agreement with Afghanistan, Bhutan, Bangladesh, and the Maldives.
▪ Air bubbles are arrangement which has come about amidst the coronavirus pandemic impacting global air
transport. Global air travel came to a grinding halt due to the COVID-19 pandemic.
▪ Aimed at restarting commercial passenger services, the transport bubbles are reciprocal in nature, and airlines
from both countries enjoy similar benefits.

India gifted ICU and ventilators to Nepal to tackle COVID-19

In a recent ceremony held at the Health Ministry of Nepal, Indian Ambassador handed over the ICU ventilators to
Health Minister who in turn thanked India for the help “in this time of crisis despite having troubled relations in
the past”.

Major Challenges:

▪ Nepal has witnessed chronic political instability, including a 10-year violent

Political Instability insurgency, damaging Nepal’s development and economy.
▪ This has significantly affected its ties with India as the changing regimes flip-

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 flopped between pro-India and pro-China stands.
▪ There was a brief economic blockade, during the Madhesi protest against the new
constitution of Nepal in 2014, which led to detoriation of bilateral ties.
Big Brother ▪ There is a perception that India is tinkering with the internal affairs and
political sovereignty of Nepal. This has led to an anti-India feeling among certain
ethnic groups in Nepal.
Trust deficit ▪ India’s reputation has been eroding over years as the implementation of various
projects has been delayed and facing issues.
Internal Security ▪ The open (porous) borders with Nepal is also a matter of concern to the Indian
security of India as it is exploited by terrorist outfits and insurgent groups from
North Eastern part of India for infiltration of trained cadres, the supply of arms, and
injecting fake Indian currency notes.
Human Trafficking ▪ Human trafficking in Nepal is a serious concern.
▪ An estimated 100,000–200,000 Nepalese in India are believed to have been
trafficked.
▪ Sex trafficking is particularly rampant within Nepal and to India, with as many as
5,000–10,000 women and girls trafficked to India alone each year.
China Factor ▪ Chinese influence is growing in Nepal which has led to the erosion of Indian
leverage.
▪ China provided Nepal with fuel supply at the time and after that China has offered
Nepal, energy and infrastructure deals, rail links, a free trade agreement and a trade
and transit treaty.
▪ Through these agreements Nepal tried to send a strong message to India that
Nepal has a viable option in mobilizing support from China to counter any pressure
generated from India.
▪ Increasing Chinese investment and co-operation with Nepal will reduce
dependence of Nepal on India. This may have serious strategic implication for
India.
▪ Nepal will actively participate in China’s Belt and Road initiative ignoring the
India’s sovereignty contention of China Pakistan economic Corridor.
▪ Nepal and China are also exploring the possibility of a free trade agreement and
China is also pressing for a Peace and Friendship Treaty.
▪ Even cooperation between Nepal Army and Chinese People’s Liberation Army is
also on rise, after their first joint military exercise last year.

Kalapani River Dispute

▪ Currently,
India and
Nepal have
border
disputes
over Kalapani
-
Limpiyadhura
- Lipulekh
trijunction
between India-
Nepal and
China and Susta
area (West
Champaran district, Bihar).
▪ Kalapani has become an issue of contention between India and Nepal after the Nepal government raised
objections to its inclusion in India's new political map. The Nepal government claimed that the Kalapani
territory located in its far-west is an integral part of its region.

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▪ The Nepal government made the claim on November 6, 2019, few days after India issued its new political map,
which showed Kalapani as a part of its own territory.
▪ Kalapani is a valley that is administered by India as a part of the Pithoragarh district of Uttarakhand. It is
situated on the Kailash Man Sarovar route.
▪ Kalapani is advantageously located at a height of over 20,000 ft and serves as an observation post for that area.
▪ The Kali River in the Kalapani region demarcates the border between India and Nepal.
▪ The Treaty of Sugauli signed by the Kingdom of Nepal and British India (after Anglo-Nepalese War)
in 1816 located the Kali River as Nepal's western boundary with India.
▪ The discrepancy in locating the source of the Kali river led to boundary disputes between India and Nepal,
with each country producing maps supporting their own claims.

Way Forward
▪ Nepal is strategically and economically important for India. Hence, India should strengthen its ties with Nepal.
Various issues should be sorted out amicably and the 1950 agreement should be
renewed considering Nepalese interests. The open border should be managed so
that it does not affect the safety and security of both nations.
▪ India should effectively use its soft power to enhance its cultural ties and people-to-
people contact.
▪ India should commit itself to complete infrastructure projects without delay.
There is huge untapped hydropower potential in the Himalayan river system
originating in Nepal. India should focus on it too.
▪ Apart from this, India should evolve a narrative to change the perception of
playing a Big brother and allay Nepal’s insecurities of its interfering with Nepal’s
internal affairs.
▪ With a growing Chinese power, Nepal’s significance has only increased further. A stable and secure Nepal is
necessary as it is of immense strategic and economic relevance for India’s security.

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 CH-7 INDIA – PAKISTAN RELATIONSHIP

Basics and Background

▪ India Pakistan relation has always been through multiple vicissitudes due to involvement of non-state actors in
the bilateral relations.
▪ Relations between India and Pakistan have been complex due to a number of historical and political events.
▪ Relations between the two states have been defined by the violent partition of British India in 1947, the
Kashmir conflict and the numerous military conflicts fought between the two nations.
▪ Consequently, even though the two South Asian nations share linguistic, cultural, geographic, and economic
links, their relationship has been plagued by hostility and suspicion.

Political Relations

▪ Since their independence, the two countries have fought three major wars, one undeclared war and have been
involved in numerous armed skirmishes and military standoffs.
▪ The Kashmir conflict is the main centre-point of all of these conflicts. There have been numerous attempts to
improve the relationship notably, the Shimla summit, the Agra summit and the Lahore summit.
▪ Since the early 1980s, relations between the two nations soured particularly after the Siachen conflict, the
intensification of Kashmir insurgency in 1989, Indian and Pakistani nuclear tests in 1998 and the 1999 Kargil
war.
▪ India with its “Neighbourhood First Policy”, desires normal neighbourly relations with Pakistan.
▪ India’s consistent position is that issues, if any, between India and Pakistan should be resolved bilaterally and
peacefully, in an atmosphere free of terror and violence.
▪ It has been made clear that India will not compromise on issues relating to national security and will take
firm and decisive steps to deal with all attempts to undermine India’s security and territorial integrity.

Bureaucratic Engagements vs. Back Channel Talks

▪ In amidst of the less trust among the India-Pakistan government after the Pathankot attack, the utility of the back
channel talks has again surfaced. Both government wants to engage, but the attacked has dented the
momentum of the process.

Track II Diplomacy

▪ It was held on the lines of Neemrana dialogue between India and Pakistan which was first held in 1991-92, in
Neemrana Fort (Rajasthan).
▪ Track II Diplomacy is also known as Backchannel Diplomacy, in which private individuals (such as former
diplomats, military veterans, academicians etc.), meeting unofficially, can find their way to common ground
that official negotiators can’t and the talks under it are not codified as official statements.
▪ Track I Diplomacy is official government diplomacy whereby communication and interaction is between
governments.

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▪ In the current scenario, government strategy becomes critically dependent on opening a back channel to
Pakistan. The sooner the back channel diplomacy begins the better. Without back channel diplomacy, the
prospects for a ‘constructive engagement’ with Pakistan look rather bleak.
▪ While Track I talks should continue despite terror attacks as non-state actors involved will not like the
peace process to gain any momentum. But the Bureaucratic engagements are generally marred by the unreal
expectation generated by the media. So to have a balanced approach, India should engage Pakistan via both routes.

Economic and Trade Relations

▪ India had accorded MFN status to Pakistan in 1996.

▪ In August 2012, India announced reduction of 30% in its SAFTA Sensitive List for non-Least Developed
Countries of SAFTA [including Pakistan], bringing down tariff on 264 items to 5% within a period of three
years. However, Pakistan continued to follow restrictive trade policy towards India.
▪ In the aftermath of cross border terror attack in Pulwama, India, on 15 February 2019 withdrew Most Favoured
Nation Status to Pakistan.
▪ India also hiked customs duty on exports from Pakistan to 200% on February 2019. Subsequently, as part of its
unilateral measures, Pakistan suspended bilateral trade with India on August 2019.

India Pakistan bilateral trade in the last 5 years

2013-14 2014-15 2015-16 2016-17 2017-18 2018-19

Exports US$2.2bn US$1.85 bn US$2.1bn US$1.83bn US$ 1.92bn US$ 2.06 bn
Imports US$0.426 bn US$0.497 bn US$.441bn US$.456bn US$0.488bn US$ 0.495 bn
Trade US$1.8bn US$1.3bn US$1.7bn US$1.3bn US$1.435 US$ 1.57 bn
Balance

Attempts for Engagement

▪ India has made a number of attempts to build normal 10-point Comprehensive Bilateral
neighbourly relations with Pakistan.
Dialogue
▪ Many a times the EAM also took the initiative to propose a
Comprehensive Bilateral Dialogue in December 2015. ▪ Peace and security, confidence
▪ These initiatives have been responded with acts of crossborder building measures (CBMs)
terrorism and violence against India (attack on Pathankot ▪ Jammu and Kashmir
Airbase; attack on Army Camp in Uri; and terror attack on the
▪ Siachen
convoy of Indian security forces in Pulwama by Pakistan based
▪ Sir creek boundary dispute
Jaish-e-Mohammad (JeM) on 14 February 2019.)
▪ On August 2019, Pakistan announced unilateral measures, ▪ Wular Barrage/Tulbul navigation
including downgrading of diplomatic relations, suspension project
of bilateral trade and review of bilateral arrangements with ▪ Economic and commercial
India. cooperation
▪ Subsequently, Pakistan suspended all bus and train services ▪ Counter-terrorism, Narcotics control
between India and Pakistan. ▪ People-to-people exchanges
▪ India has rejected Pakistan’s attempt to present an alarming ▪ Humanitarian issues
picture of bilateral ties to the world by taking such unilateral ▪ Religious tourism
measures.
▪ India has urged Pakistan to review its unilateral actions in respect of relations with India so that normal
channels of diplomatic communications are preserved.

People to People Relations

▪ There are 275 Indians, including fishermen presently believed to be in Pakistan’s custody. However, Pakistan has
acknowledged the custody of 262 of them.
▪ As a result of persistent efforts, India has been successful in securing the release and repatriation of 2133 Indians,
including fishermen, from Pakistan’s custody since 2014.

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▪ The visit to religious shrines between India and Pakistan is governed by the Bilateral Protocol on Visits to
Religious Shrines signed between India and Pakistan in 1974.
▪ The protocol provides for three Hindu pilgrimage and four Sikh pilgrimage every year to visit 15 shrines in
Pakistan while five Pakistan pilgrimage visit 7 shrines in India.
▪ India and Pakistan have signed an agreement to operationalise the Kartarpur corridor. The agreement will
facilitate visa-free movement of Indian pilgrims who would just need a permit to cross over to Pakistan.

Fight against COVID-19 & Locust attack

▪ India’s initiative of cooperation of all SAARC nations, including Pakistan, through video conferencing as well as
India’s proposal of trilateral response with Pakistan and Iran to combat desert locust attack can lay down the
path of greater cooperation between the two countries on issues impacting both of them, provided other bilateral
issues are managed or resolved.

Areas of Conflict

Cross Border Terrorism

▪ Peaceful and friendly relations between India and Pakistan require an environment free from violence and
terrorism
▪ Terrorism emanating from territories under Pakistan's control remains a core concern in bilateral relations.
India has consistently stressed the need for Pakistan to take credible, irreversible and verifiable action to end
cross border terrorism against India and fulfill its assurances, given to India at the highest level in January
2004 and reiterated several times, that territory under its control would not be allowed to be used for terrorism
against India in any manner.
▪ India has repeatedly called upon Pakistan to bring perpetrators of Mumbai terror attacks to justice
expeditiously. However, there has been no progress in the ongoing trial of Mumbai terror attacks case in Pakistan
even after all the evidence has been shared with Pakistan side.
▪ It has also been emphasised that India will continue to take firm and decisive steps to protect its national
security.
▪ Following the cross border terrorist attack on an army camp in Uri in Jammu and Kashmir on 2016 and
continued incidents of terrorist infiltrations, the Indian Army conducted surgical strikes at various terrorist
launch pads across the Line of Control, based on specific and credible inputs, and inflicted significant casualties
to terrorists and those providing support to them.
▪ In a heinous and despicable act of cross border terror attack on the convoy of Indian security forces in
Pulwama, Jammu & Kashmir on 14 February 2019, 40 security personnel were martyred.
▪ In an intelligence led operation in the early hours of 26 February 2019, India carried out a successful anti-terror
pre-emptive air strike against a training camp of JeM in Balakot, Pakistan.

Measures taken by India to deal with Pak- sponsored terrorism

• Military Efforts: India has conducted strikes on terror camps in 2016 and 2019. Also, the state has launched the
Mission All Out to liquidate all the terrorists in the Jammu and Kashmir.
• Economic Efforts: Indian government has withdrawn "Most Favoured Nation" or MFN status accorded to Pakistan.
• Strategic Shift: India made an unprecedented direct reference to Baloch freedom struggle in the PM’s Independence
Day speech.
• Diplomatic Efforts
o All major countries including America, Russia, France, U.K and Australia have supported India on its counter-terror
activity. Saudi Arabia and Organization of Islamic Countries also supported India’s stand on terror.
o India has started to completely utilize its share of water under the Indus Water Treaty, by building dams in Jammu
and Kashmir.

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o In 2016, after the Uri Attack, India successfully isolated Pakistan in the 19th SAARC summit. Since then, no
SAARC meeting has happened.
• International Measures on Terrorism: India has been pushing for the adoption of universal definition of
terrorism and steps needed to tackle it under the Comprehensive Convention on International Terrorism (CCIT).

Issues in dealing with Pakistan’s terror infrastructure

• It is difficult to completely isolate Pakistan in the international community for long time, because it has:
o Large population
o Nuclear Capabilities
o Certain Islamic nations backing Pakistan
• The organs of Pakistani state, be it the Executive or the Judiciary or the Civil Society- have been overshadowed by
its deep state. Whenever in the past, any of the other organs tried to stand, they have been crippled by the
deep state.

Impact of Pakistan sponsored terror activities:

Threat to regional peace and security.
Threat of SAARC becoming obsolete.
Diversion of resources for the procurement of military equipments.
Threat of nuclear weapons falling in the hands of terrorists.
Reduced people to people contact and cultural exchange.

Siachen

▪ Indian and Pakistani forces have faced off against each other in mountains
above the Siachen glacier in the Karakoram Range, the world’s highest
battlefield, since 1984.
▪ The two sides have been trying to find a solution that would allow then to
withdraw troops, but India says it is unwilling to bring its forces down until
Pakistan officially authenticates the positions they hold.
▪ Pakistan has said it is willing to do so but on the condition that it is not a
final endorsement of India’s claim over the glacier, sources of melt water for Pakistan’s rivers.

J&K problem

▪ Insurgency and promotion of terrorist activities, interference from Pakistani side in J&K further creating
problems for India.
▪ Consistent rise of tension along the border and frequent cease fire violation may lead to susceptibility of use of
nuclear weapons which can be catastrophic.
▪ Pakistan has been wary of India’s executive-legislative actions that scrapped Article 370.
▪ 5th August 2020 marks the one year anniversary of that move. On its eve, Pakistan released a new political map
that includes all of J&K, Ladakh, Sir Creek and Junagadh.
▪ Pakistan continuously trying to raise the J&K issue in UNSC.

Counterfeit currency and drugs

▪ Various terrorist groups operating from Pakistan supply fake notes and illegal drugs, which has been an important
security concern for India.

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▪ Golden Crescent region of South Asia consisting of Pakistan, Afghanistan and Iran is a principal global site for
opium production and distribution.

Indus Water Treaty

▪ The distribution of waters of the Indus and its

tributaries between India and Pakistan is governed by
the Indus Water Treaty (IWT).
▪ The treaty brokered by World Bank, was signed by the
then-Indian Prime Minister Jawaharlal Nehru and
Pakistani President Ayub Khan on 19 September 1960.
▪ The Permanent Indus Commission (PIC) was set up as a
bilateral commission to implement and manage the Treaty.
The Commission also solves questions arising over water
sharing.
▪ The World Bank’s role in relation to “disputes” and
“differences” with respect of IWT is limited to the
designation of people to fulfil certain roles when requested
by either or both of the parties.
▪ It is said to be the most successful water treaty in the world. As, it has survived various India-Pakistan wars and
other issues. Most disagreements and disputes have been settled via legal procedures, provided for within the
framework of the treaty.

Kishanganga Project

▪ It is a 330 megawatt Run of the River Hydroelectric

power project located in Gurez valley in Kashmir. Other Disputed Project
▪ It envisages diversion of water from the Kishenganga
River to a power plant in the Jhelum River basin through ▪ Pakal Dul Dam (concrete face rock fill dam)
an underground tunnel and the discharge of the water - Marusadar River, a tributary of the Chenab
into the Wular lake. in Jammu and Kashmir
▪ The project began in 2009 but in 2010 Pakistan appealed ▪ Ratle (run of the river hydroelectric power
to Hague’s Permanent Court of Arbitration station) - Chenab River, downstream of the
complaining that the project violated the Indus River village of Ratle in Jammu and Kashmir.
Treaty and deprived Pakistan the water share to its power ▪ Miyar (run of the river scheme) - Miyar
project which is under construction at Neelam valley in Nallah, a tributary of Chenab near Lahaul &
PoK, as the Kishanganga river flows into Pakistan. Spiti in Himachal Pradesh.
▪ Court of Arbitration ordered India to submit technical ▪ Lower Kalnai (gravity dam) On Lower Kalnai
data of the project and allowed India to go ahead with the Nalla, tributary of river Chenab in Jammu
construction of the dam while maintaining minimum 9 and Kashmir.
cubic metres of flow of water across border.

Sir Creek Dispute

▪ Sir Creek is a 96 km (60 mile) estuary in the Rann of

Kutch. The Rann of Kutch lies between Gujarat on
the India side and Sindh on Pakistan side.
▪ The dispute lies in the interpretation of the maritime
boundary line between Pakistan and India. Before
independence, the area was part of Sind Province of
British India. After independence in 1947, Sindh
became a part of Pakistan while Gujarat remained a part
of India.
▪ Though the creek has little military value, it holds
immense economic gain. Much of the region is rich in

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 oil and gas below the sea bed, and control over the creek would have a huge bearing on the energy potential of
each nation.
▪ The biggest casualty of not solving the Sir Creek is that thousands of innocent fishermen from the border region
are routinely arrested and their boats and materials confiscated under the premise of illegal intrusion. It is
difficult to know where the boundary starts and ends in sea. This unawareness added with wind flow, waves and
turbulence that push the boat in sea makes it very difficult for fishermen.
▪ If India gives up control of the eastern bank of the Creek, there is no guarantee that Pakistan would not claim
any new territory in the sector, particularly if any oil or gas discovery is made in the region. Thus, the trust deficit
in Pakistan that bedevils the overall Indo-Pak relations also makes any progress in resolving the Sir Creek issue
that much more difficult.
▪ Pakistan’s Stand on the Issue
o Pakistan claims the entire Sir Creek, with its eastern bank defined by a "green line'' and represented on a
1914 map belongs to it.
o Accepting Pakistan's premise on the "green line" would mean loss of about 250 square miles of EEZ for
India.
▪ India’s Stand on the Issue
o India says that the green line is an indicative line and felt the boundary should be defined by the "mid-
channel'' of the Creek as shown on a map dated 1925.
o India supports its stance by citing the Thalweg doctrine in international law. It states that river boundaries
between two states may be, if the two states agree, divided by the mid- channel.
o Pakistan maintains that the doctrine is not applicable in this case as it most commonly applies to non-tidal
rivers, and Sir Creek is a tidal estuary.

Gilgit Baltistan Issue

▪ India recently opposed Pakistan’s Supreme Court order to integrate the region of Gilgit-Baltistan into the
federal structure of the country.
▪ The region was a part of the erstwhile princely
state of Jammu and Kashmir, but has been under
Pakistan’s control since November 4, 1947,
following the invasion of Kashmir by tribal militias
and the Pakistan army.
▪ The region was renamed ‘The Northern Areas of
Pakistan’ and put under the direct control of
Islamabad. The Northern Areas were distinct from
Pakistan-occupied Kashmir (PoK), the part of
J&K that Pakistan calls “Azad Kashmir”. The
Northern Areas are, however, more than six times
the size of PoK.
▪ China–Pakistan Economic Corridor (CPEC) is
passing through Gilgit Baltistan.
▪ China has signed a contract with Pakistan to
construct Diamer-Bhasha Dam,a concreted-filled gravity dam on the River Indus in Gilgit-Baltistan Region.
▪ Making GB its fifth province would thus violate these UN resolutions that would damage its position on the
Kashmir issue.
▪ That would also be violative of the 1963 Pak-China Boundary Agreement that calls for the sovereign authority
to reopen negotiations with China after the settlement of the Kashmir dispute between Pakistan and India.
▪ It is also violative of the 1972 Shimla Agreement that mentions that “neither side shall unilaterally alter the
situation”.
▪ Pakistan would also have to overcome the adverse reaction of Kashmiris on both sides of the LoC.

Impact of Chinese Projects in PoK on India:

Threat to India’s sovereignty
Situation of two front war
China would strategic connectivity to whole of Asia where India would face security threat.

156
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It will increase the militarization of the area as it will become possible for Pakistan to mobilise military resources on
large scale.

Afghanistan Issue

▪ Afghanistan has become a major source of friction, although Indian and Pakistani differences over Pakistan’s
western neighbour have not been a part of their official talks.
▪ The withdrawal of US forces from Afghanistan and the prospects for renewed civil war in the nation make it
difficult to sustain India’s expansive economic engagement with Kabul. At the same time, Pakistan’s growing
weight in Afghan affairs and China’s improving role are also likely to limit Delhi’s security cooperation with
Kabul.
▪ The resurgence of the Taliban in Afghanistan and growing strength of the extremist forces in Pakistan would
suggest the north-western marches of the subcontinent will remain India’s greatest vulnerability.

China – Pakistan Axis

▪ The long-time "all-weather friendship" between China and Pakistan, rooted in a time when both countries were
deeply mistrustful of India, has long made a serious concern for New Delhi.
▪ The relationship has mainly gone one way, with China providing economic assistance and political backing to
Pakistan.
▪ The China-Pakistan Economic Corridor is being termed as
a ‘game and fate changer’ for Pakistan.
▪ China appears to have stolen a march over the U.S. and
emerged as Pakistan’s unrivalled external partner.
▪ China’s golden run in Pakistan implies a significant
mutation of the regional balance of power in South Asia
and Afghanistan.
▪ Through the corridor from Kashgar, in China’s restive
Xinjiang province, to Gwadar, Beijing will find a point of
access in the Indian Ocean at the virtual tri-junction of South Asia, West Asia and Africa.

Kulbhushan Jadhav Case

Vienna Convention on Consular Relations
▪ Kulbhushan Jadhav was arrested in March 2016 by Pakistani
security forces in Balochistan province after he reportedly ▪ The Vienna Convention on Consular
entered from Iran. Relations is an international
▪ He was sentenced to death by a Pakistani military court on the treaty that defines consular
charges of espionage and terrorism in April 2017. relations between independent states.
▪ India has always maintained that Kulbhushan Jadhav is not a ▪ A consul, (who is not a diplomat) is
spy, and that Pakistan should provide counsellor access to him a representative of a foreign state in a
as his case pertains to abduction from the Iranian territory. host country, who works for the
▪ In May 9, 2018, ICJ has stayed his death sentence after India
interests of his countrymen.
had moved a petition before the UN body to seek justice for
him, alleging violation of the Vienna Convention on Consular ▪ Article 36 of the Vienna Convention
Relations by Pakistan. states that foreign nationals who
▪ During the latest hearing in the case on February, 2019, India are arrested or detained in the host
said Pakistan's continued custody of Indian national country must be given notice without
Kulbhushan Jadhav without any consular access should be delay of their right to have their
declared "unlawful" as it was an egregious violation of the embassy or consulate notified of that
Vienna Convention. arrest.
▪ Harish Salve, who is representing India and Kulbhushan Jadhav ▪ If the detained foreign national so
in the ICJ, said Pakistan was using the issue of Kulbhushan requests, the police must fax that
Jadhav as a "propaganda tool" without even following the due notice to the embassy or consulate,
proper procedure. which can then verify the person.

157
India-Pakistan: Scope of Soft Diplomacy

▪ Deterioration of bilateral relations between India and Pakistan India’s Dimension of Soft Power
and withdrawal from all level of talks and summits from
both the sides, post Pulwama attack on 14, Feb 2019 has
▪ Ayurveda
created a need for comprehensive and sustainable conflict
resolution mechanism. ▪ Buddhism
▪ In this light, role of soft diplomacy is discussed to establish ▪ Cricket, Culture
peace between India and Pakistan. ▪ Democracy, Diaspora
▪ In contrast to the coercive nature of Hard power, Joseph Nye ▪ Entertainment: Bollywood
suggested concept of soft power in post cold war world ▪ Food (Indian style of cooking and
▪ Soft power is the ability to shape the preferences of others spices)
through appeal and attraction. ▪ Gandhian ideals
▪ The three pillars of soft power are: political values, culture, ▪ Colonial historical linkages with the
and foreign policy. nations
▪ Nye argues that successful states need both hard and soft ▪ Yoga
power, the ability to coerce others as well as the ability to shape
their long-term attitudes and preferences.

Kartarpur Corridor

▪ India and Pakistan have signed an agreement to operationalize

the Kartarpur corridor. The agreement is valid initially for five years.
▪ The Kartarpur corridor connects the Darbar Sahib Gurdwara in Narowal
district of Pakistan with the Dera Baba Nanak shrine in Gurdaspur
district in India’s Punjab province.
▪ The agreement will facilitate visa-free movement of Indian pilgrims who
would just need a permit to cross over to Pakistan.
▪ Either party can terminate the agreement at any time by giving notice of
one month to the other party of its intention to terminate this agreement.
▪ Also, the pact could be suspended in case of exigency or persistent violation of its provisions.
▪ The corridor was built to commemorate 550th birth anniversary celebrations of Guru Nanak Dev, founder of
Sikhism on 12th November 2019.

Way Forward

▪ In order to strengthen the bilateral engagements between India and Pakistan need of the hour is to employ perfect
balance of soft and hard power diplomacy coupled with International diplomacy.
▪ International Organizations can be used for building pressure over Pakistan for carrying out anti-terrorist
activities like Pakistan’s inclusion on the FATF Grey list makes it harder for its government to access
international markets at a time when its economy is weakening.
▪ Initiation of bilateral dialogue between India and Pakistan based on the "UFA" agreement aimed at combating
terrorism, freeing fishermens, meeting of military personnel’s, encouraging religious tourism will bring new
dimensions to the diplomatic engagements.
▪ In South and Central Asia, there is an opportunity with gas and electricity. Two pipeline projects — Iran-
Pakistan-India (IPI) and Turkmenistan-Afghanistan-Pakistan-India (TAPI) have been going slow due to
bilateral differences and lack of international support and US sanctions on Iran. Hopefully, now with Joe Biden in
the USA Presidency things will work out as before.
▪ Both countries can keep on engaging at multinational forums like SCO, SAARC (as seen during the Covid-19
crisis) and also continue with the Track II diplomacy. This will ensure that the window for frontline
engagement is always open.
▪ Initiatives such a Kartarpur Corridor can go a long way in improving the relationship, so other religiously or
culturally important sites such as Shakti Peeth in Pakistan Occupied Kashmir can help in developing better
People-to-people relations between the two countries.

158
▪ As the dominant power in South Asia and one of the world’s leading democracies, India must find a proper
answer to what could otherwise become a serious existential crisis
▪ Imposing economic and political sanctions on Pakistan and asking the world to follow suit
▪ There is a strong need for India to change its approach from Responsive to Proactive.
▪ A united Indo-Pak can address any threats in the sub-continent. Together India and Pakistan should take on joint
responsibility for peaceful, prosperous and cooperative development in South Asia.

159
 CH-8 INDIA – SRI LANKA RELATIONSHIP

Basics and Background

▪ The relationship between India and Sri Lanka is more than 2,500 years
old. Both countries have a legacy of intellectual, cultural, religious, and
linguistic interaction.
▪ During the period of Mauryan empire, Ashoka sent his son, Mahinda to
then Ceylon to propagate Buddhism.
▪ Linguistically, the Sinhalese speak an Indo-Aryan language descended
from Sanskrit, and not a Dravidian language like their neighbors, the
Tamils.
▪ By 1000 CE, the Tamil kingdoms in the south developed an advanced
naval apparatus and an interest in maritime conquest.
▪ Chief among these was the Chola Empire, based in today’s Tamil
Nadu. Rajendra Chola conquered Anuradhapura in 1017 and Tamil
forces occupied the island for several decades.
▪ This was the first sustained political and military contact between the
Indian mainland and Sri Lanka in centuries
▪ Pandyans, invaded Sri Lanka again in the 13th century, and eventually a
Tamil kingdom, the Jaffna Kingdom, was founded in northern Sri Lanka
▪ In recent years, the relationship has been marked by close contacts at all levels. Trade and investment have grown
and there is cooperation in the fields of development, education, culture and defence. Both countries share a
broad understanding on major issues of international interest.

Importance of India for Sri Lanka

Strategic Importance:

160
▪ India is Sri Lanka’s closest neighbour in Indian Ocean.
▪ With China’s constant efforts to occupy and encircle India, through its String of Pearls strategy, Sri Lanka
becomes an important location.
▪ Some of the ports of Sri Lanka are located among busiest sea lanes of communication.
▪ Military as well as commercial purposes can be served through this strategic location of Sri Lanka.
▪ SriLanka is part of India’s “Neighborhood First Policy”

Political Relations
▪ Political relations between the two countries have been marked by high-
level exchanges of visits at regular intervals.
▪ Both countries share a broad understanding on major issues of international
interest.
▪ In July 29, 1987 Indo-Sri Lanka Peace Accord was signed in Colombo.
▪ In recent years, significant progress in implementation of developmental
assistance projects for Internally Displaced Persons (IDPs) and
disadvantaged sections of the population in Sri Lanka has helped further
cement the bonds of friendship between the two countries.
▪ The nearly three-decade long armed conflict between Sri Lankan forces and the LTTE came to an end in May
2009. During the conflict, India supported the right of the Government of Sri Lanka to act against terrorist forces.
At the same time, it conveyed its deep concern at the plight of the civilian population, emphasizing that their
rights and welfare should not get enmeshed in hostilities against the LTTE.
▪ The need for national reconciliation through a political settlement of the ethnic issue has been reiterated by India
at the highest levels. India's consistent position is in favor of a negotiated political settlement, which is acceptable
to all communities within the framework of a united Sri Lanka and which is consistent with democracy, pluralism,
and respect for human rights.
▪ New Delhi attaches “a special priority” to its relations with Colombo.
Economic Relations
▪ Sri Lanka has long been a priority destination for direct investment from India. Sri Lanka is one of India’s
largest trading partner in SAARC.
▪ There are healthy linkages between the business chambers of the two countries. Various Indian Chambers have
signed MOU’s with Sri Lankan Chambers to promote trade and economic relations, investments between India
and Sri-Lanka.
▪ According to Sri Lankan Customs, bilateral trade in 2018 amounted to US $4.93 billion. Exports from India to Sri
Lanka in 2018 were US $4.16 billion, while exports from Sri Lanka to India are US $767 million.

▪ India is one of the largest investors in Sri Lanka.

Trade Policy ▪ The investments are in diverse areas including petroleum retail, IT, financial services,
real estate, telecommunication, hospitality & tourism, banking and food processing (tea
& fruit juices), copper and other metal industries), tires, cement, glass manufacturing,
and infrastructure development (railway, power, water supply).
▪ Last few years have also witnessed an increasing trend of Sri Lankan investments into
India. Significant examples include Brandix (about US $1 billion to set up a garment city

161
 in Visakhapatnam), MAS holdings, John Keels, Hayley’s, and Aitken Spence (Hotels),
apart from other investments in the freight servicing and logistics sector.

▪ Trade between the two countries grew rapidly, particularly after coming into force of the
India-Sri Lanka Free Trade Agreement in March 2000, whereas it was signed in
India-Sri Lanka 1998.
Free Trade ▪ Both countries have agreed upon to promote economic cooperation, in mutually
Agreement identifiable sectors like fish, energy, drugs and pharma, textiles, financial infrastructure
(ILFTA) and Tourism for greater economic integration.
▪ They agreed to Institute an annual defense dialogue.
▪ The two countries will also promote the use of space technology for societal services.

Terms of Trade
▪ Exports to Sri Lanka from India decreased to 18.34 INR Billion in March from 22.16 INR Billion in February of
2020.

Exports to Sri Lanka Imports from Sri Lanka

Gas oil/ Diesel, Motorcycles, Pharmaceutical Products, Base Oil, Poultry feeds, Areca nuts, (waste and scrap)
Portland cement, Semi finished products of Iron, paper or paperboard, Pepper, Ignition Wiring Sets,
Military weapon, Fuel oil, Rice, Cement clinkers, Copper wire, Marble, travertine and alabaster.
Kerosene type jet fuel.

Cultural Relations
▪ The Cultural Cooperation Agreement signed by the Government of India and the
Government of Sri Lanka on 29 November 1977 at New Delhi forms the basis for
periodic Cultural Exchange Programmes between the two countries.
▪ 550th Anniversary of Guru Nanak Dev was celebrated on 9 November 2019 at Swami
Vivekananda Cultural Center. During the event there was a document screening and a
Kirtan by Gyanji from Guru Nanak Darbar Gurudwara, Colombo.
▪ Indian Cultural Centre in Colombo
▪ It actively promotes awareness of Indian culture by offering classes in Indian music,
dance, Hindi, and Yoga. On 21 June 2015 the First International Day of Yoga was
celebrated at the iconic ocean side promenade Galle Face Green.
▪ As a part of commencement of 150th Birth Anniversary Celebrations of Mahatma
Gandhi in Sri Lanka, various events were organized on 2nd October.
▪ Share religious (Buddhism) and linguistic (Tamil) ties; in April 2015 India announced
Ramayan train in SL and Buddhist circuit in India; in March 2015, India organized a dialogue between
Buddhists of ‘Therevada’ tradition in SL and ‘Nalanda’ tradition in India.

People to People Relations

▪ To further strengthen people-to-people ties, the first ever pilgrimage to Bodh Gaya for Sri Lankan Armed
Forces personnel and their families was organized from 24-26 June 2018.
▪ Tourism also forms an important link between India and Sri Lanka. Sri Lankan tourists are among the top ten
sources for the Indian tourism market. The tourism sector of Sri Lanka which was severely hit by Easter Sunday
attacks received a boost by the arrival of Indian tourists. On 24 July 2019 Sri Lanka included India in the free visa
on arrival scheme and commenced the scheme on 1 August 2019.
▪ In April 2015, India granted visa-on-arrival facilities for Lankans visit India;
Developmental/ Infrastructural Projects
In recent years, significant progress in implementation of developmental assistance projects for Internally
Displaced Persons (IDPs) and disadvantaged sections of the population in Sri Lanka has helped further cement the
bonds of friendship between the two countries.

• India recently announced line of credit of $ 400 Mn to boost Sri Lanka’s

development.

162
 Line of Credit • India also announced a special line of credit of $ 50 Mn to strengthening Sri
Lanka’s ability to counter terror threats.
India-Sri Lanka Foundation • It was set up in December 1998 as an intergovernmental initiative.
• It also aims towards enhancement of scientific, technical, educational and
cultural cooperation through civil society exchanges and enhancing contact
between the younger generations of the two countries.
• With an initial commitment to build 50,000 houses for the war affected as
well as the estate workers in the plantation areas, it is Government of India
Indian Housing Project (GoI)’s flagship project of developmental assistance to Sri Lanka.
• With an overall commitment of over Indian rupees (INR) 1372 crore in
grants, it is one of the largest projects undertaken by GoI abroad.

Human Resource Development

▪ India now offers about 710 scholarship slots annually to Sri Lankan students, including study in Sri Lanka and in
India.
▪ In addition, under the Indian Technical and Economic Cooperation Scheme and the Colombo Plan, India
offers 400 slots annually to Sri Lankan nationals for short- and medium-term training courses in a wide variety of
technical and professional disciplines.
▪ From the academic session 2017-18, Sri Lankan students can also appear for National Eligibility cum Entrance
Test (NEET) in centers in India for MBBS/BDS admissions. IIT JEE (Advanced) entrance examinations have
commenced in Sri Lanka from 2017.

Indian Community
• The People of Indian Origin (PIOs) comprise Sindhis, Borahs, Gujaratis, Memons, Parsis, Malayalis and
Telugu speaking persons who have settled down in Sri Lanka (most of them after partition) and are engaged in
various business ventures.
• Though their numbers (10,000 approximately) are much lesser as compared to Indian Origin Tamils (IOTs), they
are economically prosperous and are well placed. Each of these communities has their organization which
organizes festivals and cultural events. According to unofficial statistics, it is estimated that around 14,000
Indian expatriates are living in Sri Lanka.
• According to Government census figures (2011), the population of IOTs is about 1.6 million.

13th Amendment in Sri Lankan Constitution

• In July 1987, Indo-Sri Lanka accord was signed between; in November 1987, Sri Lanka Parliament passed the
13th amendment to the constitution.

• Devolution of powers:
• Establishment of provincial councils
Objective: • Merge North and eastern provinces into a single province.
• Making Tamil as one of the official languages (along with Sinhalese)
• Have High Court, finance commission for each province.
Evaluation • The provision of merging of north and eastern provinces was revoked back in
2006.
• Although provincial councils have been created but much power has not been
devolved.

• 13th amendment plus - Former SL President Rajapaksa assured India of going beyond the 13th Amendment “to
devolve substantial powers to the Tamil majority areas”. This was termed as the ‘13th Amendment Plus.’
Approach. However, he never clearly defined what is it and it wasn’t done.

19th Amendment in Sri-Lankan Constitution

• In April 2015, Sri Lanka parliament adopted the 19th constitutional amendment.

163
• It introduces curbs on the powers of executive presidency which was the main promise of president Sirisena’s
campaign.
o Reduces the presidential and parliamentary terms to 5 yrs from 6 yrs.
o Reintroduction of 2-year limit on president’s tenure.
o President can’t dissolve parliament before it has completed atleast 4 and half years. (Earlier it could be done
after 1 year)
o Establishment of independent commissions (autonomous bodies) such as the Election Commission, the Police
Commission, the Public Services Commission and the Human Rights Commission.
o President can’t make appointment without the recommendation of constitutional Council to key posts like
Supreme Court judges.
▪ Comment -
o Like president, hold Governors of provinces accountable to elected provincial councils.
o With the arbitrary powers being taken away, minorities will, of course, feel safer.
o These reforms fall short of the abolition of executive presidency as President remains the head of Cabinet that
is Presidents current power over ministers remain intact. This can also create two power centers (president and
PM).
o Constitution council has only 3 independent members (earlier proposal was of 7).

Challenges

Fisherman Issue:
▪ Due to proximity of territorial waters of both countries, incidents of straying of Fisherman are common especially
in Palk Straits and Gulf of Mannar.
▪ Sri Lanka have repeatedly accused Indian Fisherman for straying in its territorial water especially around
Katchchativu, an islet ceded to Sri Lanka in 1974.
▪ Both countries have agreed on arrangements to deal with issue of bona-fide Fisherman of both sided crossing the
international maritime border.
▪ Indian fishermen’s entry in Sri Lankan waters and their subsequent arrests, torture and killing by Sri Lankan Navy
is a key irritant; Over 550 fishermen have been killed in the last 30 years.
▪ Through these arrangements it has been possible to deal with the issue of detention of Fisherman in a humane
manner.
▪ However, India considers it a socio economic, livelihood problem and seeks a long-term solution.

About the issue:

▪ In 1974 an international maritime boundary was delineated between these two countries. Since then both the
countries invoke their sovereignty in their own maritime territories. For many years there have been instances of
arrest of Indian fishermen who have crossed into the Sri Lankan waters by Sri Lankan coast guards. Similar
instances of arrest of Sri Lankan fishermen have also been there but it is comparatively less. Though both
countries release each other’s prisoners on humanitarian grounds but such thing impose a great loss to India,
particularly Tamil Nadu state which is and will be losing its working force and many physical assets too till the
time a permanent solution is not achieved.
▪ Indian fishermen are said to be more efficient technologically in getting a good fish catch in Palk Bay.
Sometimes they knowingly or unknowingly penetrate into Sri Lankan water for fishing. All this is affecting
severely to the fishermen of Northern Province in Sri Lanka. This region is much underdeveloped and fishing is
the only source of livelihood for them.
▪ There is also another associated issue about the sovereignty over Kachhiteevu island. This island was never
demarcated on ground as per the 1974 agreement. Hence Government of India considered it as a disputed
territory with Sri Lanka. Later on, India decided to cede this territory to Sri Lanka in order to keep the bilateral
relations undisturbed and ignored the concerns expressed by Tamil Nadu fishermen.

• Maritime boundary is clearly demarcated, but sometimes due to ignorance of it.

• To have a good catch, (due to over-fishing we have exhausted our resources).
• Now we can go to high seas (international waters; away from continental shelf)
but that requires multi-day crafts for multi-day fishing, which we don’t have.
• Fishermen continued assertion of their traditional fishing rights around

164
 Kachchathivu Island (although under 1974 agreement, this island belongs to
SL). Tamil parties even advocate unrealistic solutions like retrieving
Katchativu.
• Territorial waters overlap in some areas: Maritime border between the two
Reasons for entering: countries is about 400 kms spreading along three different areas: the
o Bay of Bengal in the north,
o the Palk Bay and
o the Gulf of Mannar in the centre and the Indian Ocean in the south.
• LTTE issue has raised vigilance: The issue of fishermen came to existence
with the emergence of violent ethnic conflict between the Tamil militants and
the Sri Lankan government in the mid 1980s. Increased vigilance by the Sri
Lankan Navy to check intermittent flow of Tamil refugees into India and flow
of arms and supplies to Tamil militant groups made fishing difficult and risky.
Due to these fishermen from both nations suffered.
• Security concerns: The monitoring is still on which aimed at preventing
possible return of LTTE cadres, who fled from the island during the height of
the conflict in 2009, to revive the insurgency all over again.

Status of Katchchativuu:
▪ It is a small barren island in the Palk Bay area.
▪ Though the 1974 agreement India agreed to Sri Lanka’s
sovereignty over Katchchativu, but with some safeguards to its
India Fisherman through article 5.
▪ However, this argument was vague enough for the Sri Lankan
government to argue, ‘the agreement did not give any fishing
rights, but only the rights to dry their fishing nets, to rest and to
the right of pilgrims to visit the islands for religious purpose.’
▪ Until civil War broke out in Sri Lanka in 1983, the Indian
Fisherman did not find it difficult to operate near the islands for
fishing.
▪ In due course of time, Sri Lankan navy became unfriendly to
Indian Fisherman owing to their inability to distinguish
between genuine fishing vessel and boats used for smuggling goods for Sri Lankan Tamil militants.
▪ Despite various outcries, the humanitarian aspect of the problem was overlooked by both countries.

1. The dispute between the two nations is affecting the basic livelihoods of
fishermen. The livelihood security of fishermen of both the sides, especially
the Sri Lankan part of Northern Province which is high deprived of
economic development and is the home to Indian origin Tamils for the
welfare and security of whom various governments of India have expressed
their concerns is at stake.
Benefits of resolving the issue: 2. Second, thing is the sovereign rights of the both the Republics and their
bilateral relations which each one has to respect.
3. Third, thing is the ecological balance of the Palk Bay which may get
damaged irreversibly by the bottom trawling if such a mad race continues by
both the sides.
4. Fourth, thing is about the traditional rights over the island in Palk Bay
especially the Kachiteevu island.
5. Fifth thing is in Indian side where the central government has to take Tamil
Nadu government into confidence and keep up the spirit of cooperative
federalism.

Possible solutions:
▪ Avoid shooting incidents due to “mistaken identity”, ‘coordinated patrolling’ between marine forces.

165
▪ Developing fish farming extensively in Indian waters would prevent its fishermen from venturing into other
waters in search of a ‘big catch’.
▪ India can also consider leasing fishing blocks, especially those identified as ‘surplus total available catch’, from
Sri Lanka.
▪ To preserve marine resources, impose strict and complete ban on mechanized trawlers.
▪ Proper fisheries management.
▪ Educate the Indian fishermen to keep to the Indian side of the Palk Bay and not to transgress Sri Lankan waters in
the Bay or in other areas.

The ‘Tamil’ issue:

1st
1983-
1987

EELAM
WAR

2nd
3rd 1995-
1990-
2002
1995

India’s Response:
• Deployment of Indian Peace Keeping Force (IPKF), under operation Pawan.
• Signing of Indo-Sri Lanka Accord, 1987 to provide political solution to the ongoing conflict.
• When conflict ended in 2009, India agreed for reconstruction of war-torn areas. It also started many rehabilitation
programs.
• Proposal for establishment of provincial council system along with devolution of power for nine provinces in Sri
Lanka (also known as The Thirteenth Amendment).

China Factor in India-Sri Lanka Relation:

▪ Some of the important infrastructure projects
developed by China in Island state include
Hambantota port, Katunayake-Colombo
Expressway, Norochcholai Coal Power Project,
Maththala airport, Colombo South Harbor
expansion project.
▪ China has invested heavily in Sri Lanka’s
infrastructure as part of its “string of pearls” policy
aimed at establishing a naval presence across South
Asia.
▪ The most talked is Hambantota port, which is
Strategically located not only Chinese merchant
vessels and cargo carriers sailing to and from Africa
and the Middle East to make a stopover but can also
be used by any military fleet.
▪ A strong foothold for Chinese in Hambantota
would allow them to have dominance over vast area
of Indian ocean extending from Australia in the east,
Africa in the west up to Antarctica in the south.
▪ Sri Lanka is in a security dilemma as growing too close to China would affect its relations with India while
leaning in favor of India would impact in arms acquisition from china.

166
Reconciliation process and war crimes:
• The UNHRC resolution on war crimes is another important issue on which both the countries have to reach an
understanding.
• India has advocated for speedy rehabilitation and ports and other facilities in friendly countries – including
Pakistan, Bangladesh, and Myanmar.
• This concerns India as China’s encroachment on its sphere of influence and eroding its commercial and cultural
links with the island resettlement of the Internally Displaced Persons (IDP).

Security Issues:
▪ India and Sri Lanka conduct joint military (MITRA-SHAKTI) and naval exercise (SLINEX).

▪ India, Sri Lanka, and Maldives signers a trilateral maritime security cooperation agreement to improve anti party
operations, surveillance and work together to reduce pollution in Indian ocean region. DOSTI is a trilateral coast
guard exercise between India, Sri Lanka & Maldives.
▪ India and Sri Lanka also signed an agreement on countering Drug and Human trafficking in April 2019.
▪ Defense trainings are also provided by India to Sri Lankan forces.

Recent development:
▪ India signed MoUs to develop Trincomalee Port and oil tank farms and LNG terminal in Kerawalapitiya
Near Colombo.
▪ India signed an agreement with Japan to develop the East Container Terminal at Colombo Harbour and offer to
operate the Mattala Airport in Sri Lanka.
▪ Expressed Sri Lanka’s willingness to see cooperation and progress in SAARC.
▪ He asked India to defer debt repayments for 3 years so that other countries can follow suit. Sri Lanka owes
approximately $60 billion total foreign and domestic debt.
▪ India and Sri Lanka agreed to hold a meeting with the Maldives leadership to re-operationalize India-Sri Lanka-
Maldives NSA level dialogue and trilateral maritime security cooperation amid growing Chinese interests.
▪ Building infrastructure in the Northern and Eastern Provinces, including upgrading the Jaffna-Colombo
rail track, providing electricity transmission lines for power imports from India, and rebuilding the
Kankesanthurai port.
▪ India is Sri Lanka’s largest trading partner globally, while Sri Lanka is India’s second largest trading partner
in the SAARC.
▪ Indo-Sri Lanka Free Trade Agreement was signed in March 2000.

Bottomline
▪ While India has returned to the settled principle of ‘non-interference’ in the internal affairs of another nation,
more so in the immediate neighborhood, the Sri Lankan situation seems to remain unclear and unsure even after
the return of ‘near- normalcy’ in political and constitutional terms. India should continue with the wait and watch
policy and be willing to engage with any leader who will emerge to hold power.
▪ India can use this opportunity to send out the right signals to Nepal and Maldives which hold suspicions against
Indian interests in their respective internal political and constitutional turmoil.

Way Forward
▪ Sri Lanka’s importance, for India, increases many folds due to its strategic location in the Indian Ocean,
especially with the Quad talks in progression.

167
▪ India and Sri Lanka agreed to hold a meeting with the Maldives leadership to re-operationalize India-Sri
Lanka-Maldives NSA level dialogue and trilateral maritime security cooperation amid growing Chinese
interests.
▪ India should rise above the domestic political pressure and forge a strong relationship with its closest neighbor.
▪ India should comply with speedy completion of projects such as India-Japan agreement to develop East
Container Terminal at Colombo harbor.
▪ India should act together with Sri Lanka on Fisherman Issue though proposed solution such as limiting the
days, timeframe, issuing identity cards etc.
▪ To improve economic cooperation, Comprehensive Economic Partnership Agreement (CEPA) must be signed
between the two countries.
▪ India should focus more on its cultural ties and try to strengthen its people to people relations.

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 CH-9 INDIA – MYANMAR RELATIONSHIP

Basics and Background

▪ India and Myanmar share a heritage of religious, linguistic and ethnic
ties. Myanmar has a substantial population of Indian origin (est. 1.5- 2
million).
▪ India and Myanmar relationship officially got underway after the Treaty
of Friendship was signed in 1951.
▪ Further, Myanmar is our gateway to South East Asia and ASEAN with
which we are seeking greater economic integration through India’s
'Look East' and later ‘Act East’ Policy.
▪ Myanmar also offers us an alternative access route to the Northeast.
Apart from supply of pulses, possibilities of energy supply from offshore
blocks in Myanmar and business opportunities that emerging from an opening economy underpin bilateral
relations.

Political Relations
▪ The relations between two countries, which in past were part of a single
empire many times, were warm and strong, until overcoming tensions
related to drug trafficking, the suppression of democracy and the rule of
the Junta captured the power in Myanmar.
▪ After the Junta cauterization in Myanmar, India has maintained careful
neutrality, while maintaining a dialogue with the government. India
condemned the suppression of democracy and Myanmar ordered the
expulsion of the Burmese Indian community, increasing its own isolation
from the world.
▪ Only China maintained close links with Myanmar while India supported to the pro-democracy movement.
▪ The decision was in part motivated by India’s own commitment to democracy and support for Aung San Syu Kyi,
and in part to not allow China to grow deeper ties with the important neighbor.
▪ In 2015, democracy was restored in Myanmar and this, has paved the way for a deeper engagement between
the India- Myanmar relationships.
▪ Since 2014, 2 visits by Indian PM to Myanmar, 2 Visits by Myanmar State Counsellor to India, 1 visit by Indian
President to Myanmar and 3 visits by Myanmar President to India, and various ministerial visits.
▪ Over 25 institutionalized mechanism including JWGs on Power, Oil& Gas, and Science & Technology etc.
▪ At the signing of the Nation-wide Ceasefire Agreement on 15 October 2015 between Myanmar and eight Ethnic
Armed Groups, NSA represented India.

Strategic Significance
▪ Myanmar shares a long land border of over 1600 Km with India as well as a maritime boundary in the Bay of
Bengal.
▪ Myanmar shares borders with 4 Indian states – Mizoram, Manipur, Nagaland and Arunachal Pradesh in
Northeast India.

169
▪ Myanmar is the only ASEAN country bordering India which
provides a gateway to South East Asia.
▪ India - Myanmar border is highly porous, poorly guarded and
located along a remote, underdeveloped, insurgency-prone
region and proximate to opium producing area.
▪ The border is also vulnerable to the activities of insurgents and
drugs and arms traffickers.
▪ Myanmar is also important from the security point of view as
the influx of sizable numbers of Rohingya from Myanmar’s
Rakhine state continues.
▪ India–Myanmar border poses a challenge to India’s security.
▪ China’s massive ‘One Belt One Road’ project fall in
importance with the one area that is often highlighted is the
Bangladesh-China-India-Myanmar (BCIM) economic
corridor, so India has long been skeptical of this project with
many analysts believing that it as being used to strengthen
China’s “STRING OF PEARL” strategy same as like it will gives teeth to India’s ‘Act East Policy’. India and
China compete in some area; Myanmar’s geographical location is such that there is plenty of room for a healthy,
cooperative relation.

India-Myanmar-Thailand (IMT) Trilateral Highway

▪ India-Myanmar-Thailand Trilateral Highway is ambitious project of 3200
kms. that will connect India with the ASEAN region.
▪ Route → Moreh (India) – Tamu (Myanmar) – Kalewa (Myanmar) – Yagyi
(Myanmar) – Monywa (Myanmar) – Mandalay (Myanmar) –– Nay Pyi Taw
(Myanmar) –Myawaddy (Myanmar) – Mae Sot (Thailand).
▪ The highway will link Moreh in Manipur state (India), via Mandalay city
(Myanmar) and to Mae Sot district (Thailand). It is a part of India’s
upgraded “Act East” policy, which seeks to strategically build India’s link
with the Southeast Asian region.
▪ The project comes off the heels of the Bangladesh, Bhutan, India and
Nepal Motor Vehicle (BBIN MV) Agreement, signed in June 2015, and the
proposed India-ASEAN trade center.
▪ Myanmar Friendship Road → The India–Myanmar Friendship Road, forms
part of the IMT trilateral highway

Economic and Trade Relations

▪ The success of India’s Act East Policy, Neighbourhood first policy largely depend on its relations with
Myanmar.
▪ Total bilateral trade between India and Myanmar: US $1.5 billion in 2019- 20.
▪ India announced the quota of 1.5 lakh tons of Vigna Mungo for import from Myanmar till 31 March 2021.
▪ Recently, India announced the debt service relief to Myanmar under the G20 Debt Service Suspension
Initiative from 1 May 2020 to 31 December 2020.
▪ Duty Free Trade Preference (DFTP) and ASEAN-India Trade in Goods Agreement (AITGA), are the two
policy frameworks for India-Myanmar normal trade through the land border.
▪ Some of the Indian companies such as Essar, GAIL, and ONGC Videsh Ltd. have invested in
Myanmar’s energy sector.
▪ Cooperation in the banking sector, which is crucial for investment and trade, is moving ahead steadily. United
Bank of India and EXIM Bank have representative offices in Myanmar.
▪ Indian firms engage in manufacturing, services (banking, insurance, dry port), power sector etc.
▪ Both sides have identified 10 locations for border haats and are in discussions for the finalization of mode of
operations.

Energy

170
▪ India and Myanmar agreed to cooperate in the field of petroleum products, inter alia, for cooperation in
refining, stockpiling, blending and retail through a Government-to-Government Memorandum of
Understanding.
▪ Both sides agreed to encourage and facilitate cooperation among oil and gas companies of India and
Myanmar for development of petroleum products, including enhancing trade and investments in this area.
▪ Both sides welcomed investments by Indian oil and gas Public Sector Undertakings (PSUs) in Myanmar’s
upstream sector and agreed that efforts would be made to explore opportunities to export to India a portion of the
output from such projects where investments have been made by Indian oil and gas PSUs.

Development Assistance
▪ Around US $ 1.4 billion is spent in development partnership. Most of our exposure in Myanmar is in grant
projects.
▪ India supplied medical equipment worth more than USD 1 million to fight COVID 19 in Myanmar. During the
FS visit, India handed over 3000 vials of Remdesivir.
▪ Grant projects include connectivity infrastructure like Kaladan Multi Modal Transit Transport Project, IMT
Trilateral Highway (Kalewa Yargi, 69 bridges etc.)
▪ Line of Credit projects include railway projects, establishment of data link, telecommunication projects etc.
India is also providing assistance in setting up institutions for higher learning and research, namely Myanmar
Institute of Information Technology, Advanced Centre for Agricultural Research and Education, Myanmar-
India Centre for Enhancement of IT Skills, India-Myanmar Industrial Training Centres.
▪ A new Indian proposal suggests the setting up of infrastructure and socio-economic projects jointly with
Myanmar in the restive Rakhine state—in the areas of education, health, agriculture, agro-processing,
upgradation of roads, small power projects and livelihood activity.

Connectivity
▪ India is building the Kaladan Multi-Modal Transit Transport, a
road-river-port cargo transport project, to link Kolkata to Sittwe in
Myanmar and then from Myanmar’s Kaladan river to India’s north-
east.
▪ India, Myanmar, and Thailand are building the Asian Trilateral
Highway, which will connect India to ASEAN. The road is expected
to boost trade and commerce in the ASEAN–India Free Trade
Area, as well as with the rest of Southeast Asia.
▪ Signing of Land Border Crossing Agreement (LBCA) in 2018
facilitated movement of bonafide citizens of both countries with valid
travel documents/visas to travel across India-Myanmar land border.
▪ Opening of Integrated Check Post (ICP) at Moreh (Manipur) and
Land Customs Station at Zokhawthar (Mizoram).
▪ Both sides are in discussion and moving forward on the Motor vehicles Agreement and agreed on the
operationalization of Imphal Mandalay coordinated bus service.

Free Movement Regime

▪ In order to facilitate free movement of the tribal people along the border of India and Myanmar, the
mechanism of the free movement regime was introduced.
▪ Free Movement Regime (FMR) allows the tribes living along the border to travel 16 km across the boundary
without visa restrictions.

Capacity Building
▪ India has been undertaking a number of capacity building programs for Myanmar.
▪ India is one of the largest trainers in Myanmar.
▪ President of India dedicated an advanced Centre for Agricultural Research & Education and Rice Bio-park to
the people of Myanmar (2018).
▪ Myanmar Institute of Information and Technology a bilateral capacity building project between India and
Myanmar became operational (2015).
▪ Upgradation of Sittwe Children Hospital and Yangon General Hospital projects completed

171
▪ Completion of Microwave Radio Link Rhi-Mindat Telecommunication project (EXIM Line of Credit)
▪ First three years’ work of Border Area Development programme completed. (Around 140 projects for the first
4 years completed. 4th year almost 90% complete)
▪ Up gradation of Women and Children Hospital, Monywa completed.
▪ India handed over 18 locomotives to Myanmar under Line of Credit between 2017-18.

Assistance in Disaster Management

▪ India’s assistance in disaster relief- Cyclone Mora (2017), Komen (2015), earthquake in Shan State (2010),
Cyclone Nargis in 2008 and the outbreak of influenza virus in Yangon in July-August 2017.
▪ India has also offered 20,000 kits of relief materials to displaced persons in Rakhine.

Defence Cooperation
▪ India-Myanmar Bilateral Army Exercise (IMBAX) is aimed at building and
promoting closer relations with armies.
▪ Myanmar is a key partner in the fight to end insurgency in India's northeast.
▪ Both sides are committed to peace and stability along the border areas and to
not allow any negative elements to use their respective soil for hostile activities
against the other side.
▪ Both sides have an agreement on Maritime Security Cooperation covering
Maritime Domain Awareness and signed a White Shipping Agreement.
▪ India has been concerned over some militant groups like the United National
Liberation Front (UNLF) and National Democratic Front of Bodoland (NDFB) from the North-East region
taking shelter in Myanmar. Myanmar handed over 22 cadres of Indian insurgent groups in May 2020.
▪ On February 2016, the navies of the two countries signed the standard operating procedure (SOP) for India –
Myanmar Coordination Patrol (IMCOR). This pact formalises the key part of ongoing maritime cooperation
between India and Myanmar.

Cultural Relations
▪ India and Myanmar share cultural ties in terms of Buddhist heritage and shared history of colonialism.
▪ Building on this shared heritage, India is undertaking some key initiatives in the restoration of the Ananda
Temple in Bagan and the repair and conservation of a large number of damaged pagodas.
▪ Archaeological Survey of India (ASI) preserved and restored stone inscriptions and temples of King Mindon
and King Bagyidaw of Myanmar in Bodh Gaya.
▪ The year 2020 marks the commemoration of 100th birth anniversary of Bal Gangadhar Tilak. There is a
proposal to install his bust in Mandalay where he had spent 6 years and penned the Gita Rahasya.

Multilateral Partnership
▪ Myanmar is also a key component of India’s strategy to bridge South and
South-East Asia through BIMSTEC (Bay of Bengal Initiative for Multi-
Sectoral Technical and Economic Cooperation).
▪ Myanmar's membership of ASEAN, BIMSTEC and Mekong Ganga
Cooperation has introduced a regional/sub-regional dimension to bilateral
relations and imparted added significance in the context of our "Act East"
policy.
▪ Myanmar has generally been supportive of India's stand in various
international organisations. For our part, we have supported Myanmar's
association with SAARC as an observer, a status Myanmar formally
acquired in 2008.
▪ Myanmar has recently ratified the amendment to the Framework
Agreement of the International Solar Alliance (ISA) which would enable
the expansion of the scope of ISA membership to all Member States of the United Nations.

172
 Mekong Ganga Cooperation
▪ It is an initiative by six countries – India and five ASEAN countries, namely, Cambodia, Laos, Myanmar,
Thailand and Vietnam (Mekong passes through these five countries along with China).
▪ It seeks for cooperation in tourism, culture, education, as well as transport and communications.
▪ It was launched in 2000 at Vientiane, Laos.
▪ Both the Ganga and the Mekong are civilizational rivers, and the MGC initiative aims to facilitate closer
contacts among the people inhabiting these two major river basins.

Rohingya Issue
▪ Recently, Rohingyas were deported to Myanmar via Manipur’s Moreh along the India-Myanmar border.
▪ Building on the progress made under the Rakhine State Development Programme (RSDP), India proposed to
finalise projects under phase-III of the programme, including setting up of a skills training centre and upgrading of
agricultural mechanisation.
▪ The balancing act between Bangladesh and Myanmar gives relief to Delhi and remains one of the keys to
its overall approach to the Rohingya issue.

Rohingya
▪ They are a predominantly Muslim group living mainly in Rakhine State (Arakan Region) on the Myanmar’s
western coast. They speak a dialect of Bengali, as opposed to the commonly spoken Burmese language.
▪ Though they have been living in the South East Asian country for generations, Myanmar considers them as
persons who migrated to their land during the Colonial rule. So, it has not granted Rohingyas full citizenship.
▪ India legally deports the Rohingya to Myanmar since it is not party to the 1951 Convention on Refugees and its
1967 Protocol. Both these legal instruments enshrine the principle of non-refoulement or the obligation of state
parties to not return refugees to countries where they face a clear threat of persecution.
▪ They are treated as illegal immigrants in India and India does not have any domestic law on procedure or law
that governs the protection of refugees in India.
▪ In response to the humanitarian crisis being faced on account of the large influx of refugees into Bangladesh,
Government of India has decided to extend assistance to Bangladesh under “Operation Insaniyat”.

Military Cooperation
Indian army crossed into Myanmar territory to raid NSCN (Khaplang) camps without Myanmar’s consent. It led to a
debate of sovereignty.
Arguments in favor: Arguments against:
▪ It was done in response to attack by militants on the ▪ The doctrine of hot pursuit lacks legal validity on
Indian Army in Manipur on June 4, 2015. land. It has validity only in high seas. This doctrine
▪ Every country has the right to protect its boundary. has been codified only for navy to cross
▪ Myanmar’s relation with NSCN (K) is warming up. international waters under United Nations
It wouldn’t have helped us the way Bhutan and Convention on the Law of the Sea). But no such
Bangladesh did. doctrine has been codified for state to pursue
▪ These terror outfits are taking benefits of the border criminals crossing land border
i.e. after conducting strikes they went back to ▪ As the term is open-ended/vague thus armed forces
Myanmar knowing that Indian forces won’t cross can use it attack not only militants, but even armed
the border. In this asymmetric warfare they don’t forces thus leading to war among the nations
have an option. ▪ It will set a bad precedent as other countries can also
▪ India has a reputation of respecting the sovereignty start using it to cross border
of other country, hasn’t invaded any till now, and so ▪ If Myanmar had done the same vis-à-vis India then
won’t do this unnecessarily. how would we have reacted?
▪ It is more to assert regional dominance and coerce
neighbors.
▪ Even a possibility of military action justified by hot
pursuit can fuel wide-scale humanitarian crises e.g.
displacing the innocent people.

Way forward:

173
▪ First option is that the two countries should coordinate so no need arises (like Bhutan and Bangladesh did).
▪ If not then cross the border as everything is valid to protect our sovereignty. But only for self- defense and not to
assert dominance.
▪ And quote the expanded doctrine of self-defense under UN charter instead of hot pursuit (which lacks legality) -
which is used by many states after 9/11 to deal with non-state actors. It is more acceptable.
▪ Above all stop chest-thumping as witnessed in its aftermath. Remain silent while doing it.

Democracy in Myanmar
Myanmar elections:
▪ 1st genuine free elections in 25 years
▪ Massive turnout of 80% of eligible voters

▪ Tackling Poverty [one of the LDC (least developed country)]

▪ Government schemes reach only 3% of the population
▪ Armed Ethnic conflicts continues (many Guerrilla groups from kachin states haven’t
signed it)
▪ Armed religious conflict (persecution of Rohingyas by radical Buddhist groups.)
▪ Sustainable development (Myanmar has the 3rd largest deforestation rate in world)
Challenges ahead - ▪ The country’s military will retain several key cabinet positions, including the
need to solve the ministries of defence, home, border security and the police. Not only are 25% of
following issues: parliamentary seats reserved for the military making any constitutional amendments
without its approval impossible it also retains the power to take over government
under certain circumstances.
▪ The constitution mandates that the military can take direct control of government
should it deem it necessary.
▪ Perhaps most important, the military-dominated National Defence and Security
Council retains decision-making powers on the internal security issues facing the
country
▪ Suu Kyi will still not be allowed to stand for president on account of having children
with foreign citizenship a provision of the military-drafted constitution.
▪ Return of democracy for a democratic India is an important opportunity.
▪ Need to seize the opportunity and launch a new partnership with it as it’s our
gateway to the east.
▪ For, even during the years of western sanctions against Myanmar, India maintained
ties with the Yangon-Naypyidaw administration.
Significance for India: ▪ And given Suu Kyi’s India connection she had spent considerable time in this
country in her younger days India is perfectly placed to facilitate better
understanding between NLD and Myanmar’s military officers.
▪ Plus, stability in Myanmar is important for India given their shared border. The
Naga insurgency in India’s northeast also has roots in Myanmar, requiring
cooperation between the two countries to tackle this problem. Thus, NLD’s expected
victory provides scope for India to aid the democratic process in Myanmar and boost
the bilateral relationship.

Recent Developments
▪ Opening of coordinated bus service between Imphal and Mandalay.
▪ India’s assistance in the construction of Integrated Check Point at Tamu, Myanmar, bordering Manipur.
▪ India will offer medical radiation equipment Bhabhatron II for treatment of cancer patients, and strengthen
cooperation in the health sector.
▪ Agreed to have government-to-government cooperation in petroleum, including in refinery, stockpiling,
blending and retail.
▪ Extend the Quick Impact Project (QIP) schemes to Myanmar.
▪ India will help Myanmar with the project of e-ID cards, which is modelled after the Aadhaar project.
▪ Both sides agreed to enable the launch of India’s RuPay Card in Myanmar.
▪ Commitment to continue negotiations on various pending treaties like Mutual Legal Assistance Treaty and
Extradition Treaty.

174
▪ Early completion of the Paletwa - Zorinpui road – the final leg of the Kaladan project.
▪ Also, recently, under ‘India-Myanmar Friendship Project’ India has handed over 250 pre-fabricated houses in
the Rakhine State for the rehabilitation of refugees.
▪ Earlier, Myanmar bought India’s first locally-produced anti-submarine torpedo, called TAL Shyena, in 2017. In
2019 Myanmar acquired a diesel-electric Kilo-class submarine, INS Sindhuvir.
▪ The inauguration of the liaison office of the Embassy of India in Naypyidaw may seem a routine diplomatic
activity.

Challenges

Internal Security
▪ Internal Security is a major concern for India; Indo-Myanmar border is porous and lightly policed which is
exploited by terrorist outfits and insurgent groups from North Eastern part of India eg. supply of trained cadres,
arms trafficking.

Growing Chinese Influence

▪ China has asserted itself through its soft power as well as through its trade and economic relations with Myanmar
by taking up large infrastructure projects.
▪ As China’s growing influence in the region is a potential threat to India, New Delhi would like to enhance India’s
presence by developing infrastructure and connectivity projects in the country.
▪ India has found it difficult to counter Chinese influence in Myanmar.

China-Myanmar Economic Corridor (CMEC)

▪ CMEC is proposed economic corridor of China under Belt and Road Initiative providing connectivity between
Myanmar and China.
▪ It involves a central road and rail transport infrastructure leading from Southern China’s Yunnan Province
through Muse and Mandalay to Kyaukphyu in Rakhine State in Myanmar.
▪ It provides China another node to access the Indian Ocean.

Trust Deficit
▪ Overtime trust deficit has widened between India-Myanmar because of the Indian reputation for delaying
implementation of various projects
▪ India suffers from an image of being a poor executioner of infrastructural projects.

Rohingya Illegal Immigrants

▪ The Indian government is concerned about Rohingya immigrants in the country
▪ Around 40,000 Rohingyas are said to be staying illegally in India.
▪ Negotiations on the deportation of Rohingya to Myanmar are a point of contention.

Smuggling and Drug Trafficking

▪ The India Intelligence Agency stated that the smuggling of light arms, drugs and counterfeit currencies have been
spotted along the border.

Way Forward
▪ Strengthening existing cooperation in areas of security and counter-terrorism, trade and investment,
infrastructure and energy, and culture
▪ Boosting cooperation in areas like training and capacity-building of Myanmar’s military.
▪ India can help in improving the socio-economic conditions in the Rakhine state and also create employment
opportunities.
▪ The two countries must start negotiating for the smooth movement of goods and vehicles
▪ With Myanmar’s government emphasizing higher education and vocational training, more Indian assisted
institutions can be setup in the country.
▪ Border trade need to become more formalized with single-window clearances and easier currency
arrangements.
▪ The border haats can energise exchange of local produce.

175
▪ Cross- border bus services can promote people-to-people connectivity.
▪ Cross-border trade in services can be boosted in sectors like medicine, diagnostics, education and training for
which there is a large market.
▪ All this will mean that the Northeast will gain from the Act East policy.

176
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 (UNIT-4) CH-1 NON ALIGNMENT MOVEMENT (NAM)
Basics and Backgrounds
▪ Founded in 1961 in Belgrade.
▪ It was created by the heads of Yugoslavia, India, Egypt, Ghana and Indonesia.
▪ All five leaders believed that developing countries should not help either the Western or Eastern blocs in the
Cold War.
▪ The Non-Aligned Movement was formed during the Cold War as an organization of States that did not seek to
formally align themselves with either the United States or the Soviet Union, but sought to remain independent
or neutral.
▪ It was created by Yugoslavia’s President, Josip Broz Tito, India’s first PM, Jawaharlal Nehru, Egypt’s
second President Gamal Abdel Nasser, Ghana’s first president Kwame Nkrumah, and Indonesia’s first
President, Sukarno.
▪ The movement represented the interests and priorities of developing countries. The Movement has its origin in
the Asia- Africa Conference held in Bandung, Indonesia in 1955. "Ten Principles of Bandung", were proclaimed
at that Conference were guiding principles of NAM.
▪ As a condition for membership, the states of the NAM cannot be part of a multilateral military alliance (such as
the NATO) or have signed a bilateral military agreement with one of the “big powers” involved in Great Power
conflicts.

Principles

The principles of NAM was largely guided by Panchsheel principles, some of them are:

▪ Respect for the principles enshrined in the charter of the United Nations and international law.
▪ Respect for sovereignty, sovereign equality and territorial integrity of all States.
▪ Peaceful settlement of all international conflicts in accordance with the charter of the United Nations.
▪ Respect for the political, economic, social and cultural diversity of countries and peoples.
▪ Defence and promotion of shared interests, justice and cooperation, regardless of the differences existing in the
political, economic and social systems of the States, on the basis of mutual respect and the equality of rights.
▪ Respect for the inherent right of individual or collective self-defence, in accordance with the charter of the
United Nations
▪ Non-interference in the internal affairs of States. No State or group of States has the right to intervene either
directly or indirectly, whatever the motive, in the internal affairs of any other State.
▪ Promotion and defence of multilateralism and multilateral organisations as the appropriate frameworks to
resolve, through dialogue and cooperation, the problems affecting humankind.

Objective

▪ NAM has sought to "create an independent path in world politics that would not result in member States becoming
pawns in the struggles between the major powers."
▪ It identifies the right of independent judgment, the struggle against imperialism and neo-colonialism, and the use
of moderation in relations with all big powers as the three basic elements that have influenced its approach.
▪ At present, an additional goal is facilitating a restructuring of the international economic order.

NAM in Cold War Era

Positive Role Negative Role

▪ NAM played an important role during the Cold War ▪ Could not prevent India-Pakistan and Indo-China
years in furthering many of the causes that India wars.
advocated like: ▪ During the wars, NAM members invariably adopted
▪ Decolonisation diplomatic positions that were not favourable
▪ End to apartheid towards or supportive of India.

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 ▪ Global nuclear disarmament ▪ Taking a broader perspective:
▪ Ushering in of new international economic and ▪ Non-alignment stood for policy autonomy for the
information orders erstwhile newly independent countries. 2)These
countries banded together because of their shared
traditions and histories, which included anti-
colonialism, anti-imperialism and anti-racism.
▪ The idea behind non-alignment thus conceived was
to promote peace and security in a global arena
where superpowers were constantly posturing to
achieve their hegemonic ambitions.

How has NAM benefitted India?

▪ India being a founder and largest member in NAM was an active participant in NAM meetings till 1970s but
India’s inclination towards erstwhile USSR created confusions in smaller members. It led to the weakening of
NAM and small nations drifted towards either US or USSR.
▪ Further disintegration of USSR led the unipolar world order dominated by US. India’s New Economic Policy and
inclination towards US raised questions over India’s seriousness over non alignment.
▪ Prime Minister of India skipped the 17th Non Aligned Movement (NAM) summit held in Venezuela in 2016, it
was only second such instance when Head of a state didn’t participate in NAM conference.
▪ Moreover, NAM continued losing relevance for India in a unipolar world, especially after the founding members
failed to support India during crisis. For instance, during 1962 War with China, Ghana and Indonesia, adopted
explicitly pro-China positions. During 1965 and 1971 wars, Indonesia and Egypt took an anti India stance and
supported Pakistan.
▪ India in particular, but also most other NAM countries, have integrated themselves to varying degrees within the
liberal economic order and have benefited from it.
▪ India is a member of the G20 and has declared itself as a nuclear weapons power and has for all practical purposes
abandoned the call for global nuclear disarmament.
▪ India has also engaged itself with new and old global powers. India joining the Quadrilateral Security Dialogue, a
coalition seen by many as a counterforce to China’s rise in the Indo-Pacific and Shanghai cooperation organisation
led by China shown India’s balancing approach in new world order.
▪ India is striving hard for a multipolar world order and asserting itself as one of the player. Multi polar world order
is very much closed to NAM principles.

Present Situation

▪ The end of cold war led to unipolar world and now tending towards multi-polarity. The NAM is now reached
irrelevance.
▪ NAM could not push for reforms in the global bodies like UN, IMF and WTO.
▪ Inability to find solution to the West-Asian crisis. Withdrawal of one of the founder members- Egypt, after the
Arab Spring.
▪ Most of the members are economically weak; hence they have no say in world politics or economy.
▪ World has again moved towards bi-polarity, one led by US and other by China-Russia. The war torn syria is
prime example of this, where both US and Russia is asserting power.
▪ The escalating tension in Indo-pacific region due to China’s assertion and US acting as a counterweight to
check the Chinese expansionist policy.
▪ The large scale migration in Europe and Asia due to the unstable regimes and ethnic conflict in different parts
of world.
▪ Issue of global climate change and occurrence of catastrophic disasters raising demand to form global
consensus to deal with it.
▪ Changing US policies, protectionism, prevalent terrorism and nuclearisation of middle east.
▪ Formation of multiple regional economic groupings like TPP and RCEP and fading away of multilateral
bodies WTO from global arena.

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▪ Several members of the NAM including India have been strengthening their engagement with the developed
world to bring capital, technology, larger markets etc. to improve the economic conditions of their people.
These reduce scope for effective agenda for NAM bringing countries together.
▪ There has been no specific agenda among members on policies required to address challenges related to peace,
security and economic development of developing countries.
Relevance of NAM
▪ Can be used as a platform to bring about disarmament.
▪ Voice of the South Bloc (Third World Countries)
▪ Stability in the rising multipolar world order
▪ Can help to contain the rise of China by raising a collective voice.
▪ A platform where India’s Leadership is recognized
▪ A unique platform of countries with dissimilar backgrounds and interests
▪ Can be used to gather support for India’s quest to become a permanent member of the UNSC.
▪ Developing countries share much in common, have similar experiences and shared aspirations.
▪ Principles like strategic independence and autonomy collective position on challenges faced by the developing
world always remain relevant.

Non Alignment Movement Virtual Summit

▪ The virtual Non-Aligned Movement (NAM) Contact Group Summit held through video conferencing
recently.
▪ Theme: “United against Covid-19”.
▪ The meeting was convened at the initiative of President Ilham Aliyev of Azerbaijan, in his capacity as chair of
the Non Aligned Movement.
▪ Moreover 30 Heads of State and other leaders had joined the Summit.
▪ The Summit was also addressed by the UN General Assembly president and World Health Organisation
(WHO) chief.
▪ It was the first time that Prime Minister Narendra Modi participated in a NAM Summit since he assumed the
office in 2014.
▪ Prime Minister Narendra Modi became the first Indian Prime Minister to skip the NAM Summit in 2016 and
in 2019.

India’s Stand

▪ India’s Role in Fight Against Covid-19:

o India is regarded as the pharmacy of the world especially for affordable medicines.
o Despite its own needs during Covid-19 pandemic, it has ensured supply of medicines to 123 partner countries
including 59 NAM members.
o India is also active in global efforts to develop remedies and vaccines for Covid-19.
▪ Need for the New Template of Globalisation:
o India stated that Covid-19 has shown limitations of the existing international system. The world needs more
representative international institutions and thus world order should be more representative.
o Thus, in the post-Covid world, a new template of globalisation, based on fairness, equality, and humanity is
needed.
▪ International Cooperation:
o NAM should call upon the international community and the WHO to focus on building health-capacity in
developing countries.
o World needs to ensure equitable, affordable and timely access to health products and technologies for all.
▪ Other Issues:
o India also flagged the issues of “terrorism” and “fake news”, calling them “deadly viruses” at a time when
the world fights the novel coronavirus.
o The above issues divide communities and countries creating difficult situations.

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Way Forward

▪ NAM as a concept can never be irrelevant, principally it provides a strong base to foreign policy of its members.
▪ It should be seen as “Strategic Autonomy”, which is the need of the hour of today’s world. The principles of
NAM still can guide the nations towards it.
▪ NAM is a platform where India can assert its soft power and provide an active leadership and by being a
torchbearer for smaller countries at multilateral platforms.
▪ Platform like Non Aligned Movement should be used for consensus making on spectrum of global issues like
terrorism, climate change and trade protectionism and others.
▪ NAM platform can be used to garner support by South-East Asian countries like Vietnam, Malaysia,
Indonesia and Philippines against Chinese assertion in South China Sea and related island and border
disputes.
▪ NAM can provide a platform for Afro-Asian cooperation and a strong position for poor African nation to have
healthy negotiations with China and US for economic development without compromising the sovereignty of their
land.

NOTE: Rest of the portion already covered in other topics of this book.

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 (UNIT-5) CH-1 ASIA-PACIFIC ECONOMIC COOPERATION
(APEC)
Basics and Backgrounds
Free and open
▪ The forum initially started as an informal dialogue trade and
investment
of economic leaders in 1989 in Canberra,
Australia to leverage the growing
Facilitate a
interdependence of the Asia-Pacific. favourable and
Accelerate
regional
▪ It was formally established in 1993 with 12 sustainable
business
economic
integration
members. environment.
Objective
▪ Currently, APEC has 21 member economies of
the Pacific Rim.
▪ India was invited to be an observer for the first
time in November 2011. India is not in the Enhance
Encourage
economic and
grouping and has applied for membership. human
security
technical
cooperation

Member Countries

1. Promote free and open trade and investment

2. Promote and accelerate regional economic
integration
3. Encourage economic and technical cooperation,
4. Enhance human security,
5. Facilitate a favorable and sustainable business
environment.

Quick Facts

▪ The member countries collectively account for

nearly 50% of world’s trade and about 57% of
world’s GDP.
▪ The founding members of APEC were Australia; ▪ The creation of APEC was primarily in response to
Brunei Darussalam; Canada; Indonesia; Japan; the increasing interdependence of Asia-Pacific
Korea; Malaysia; New Zealand; the economies.
Philippines; Singapore; Thailand; and the ▪ Also, the proliferation of regional economic blocs,
United States. such as the European Union (EU) and the now
▪ China; Hong Kong, China; and Chinese Taipei defunct, North American Free Trade Area
joined APEC in 1991. (NAFTA), encouraged its formation.
▪ Mexico and Papua New Guinea joined in 1993. ▪ In 1994 during the Bogor, Indonesia summit,
▪ Chile acceded in 1994. APEC set the Bogor Goals of “free and open
▪ And in 1998, Peru; Russia; and Viet Nam joined. trade and investment in the Asia-Pacific by
2010 for industrialized economies and 2020 for
Goals and Objective developing economies.”

• The primary goal of APEC is to support Bogor Goals

sustainable economic growth and prosperity in
the Asia-Pacific region. In 1994, APEC Leaders committed to achieving the
• Objective – ‘Bogor Goals’ of free and open trade and
investment by 2020 through reducing trade barriers
in the region and promoting the free flow of goods,
services and capital among APEC economies. Since

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then, members have made measurable progress in competition and better functioning markets in
achieving these goals. the Asia-Pacific through regulatory reform,
improving public sector and corporate
governance, and strengthening the legal
infrastructure.
Functions ▪ Average tariffs fell from 17% in 1989 to 5.2% in
2012.
▪ APEC region’s total trade increased over seven
times outpacing the rest of the world with two-
thirds of this trade occurring between member
economies.

Ease of Doing Business

▪ APEC launched its Ease of Doing Action Plan in

2009 with an aim of making it cheaper, easier and
faster to do business in the region.
▪ Between 2009 and 2015, member countries
improved ease of doing business in the Asia-
▪ APEC works to help all residents of the Asia- Pacific by 14.8% across all areas of the initiative
Pacific participate in the growing economy.
▪ APEC projects provide digital skills training for Initiatives for a cleaner environment
rural communities and help indigenous women
export their products abroad. ▪ APEC has been encouraging the development of
▪ Recognizing the impacts of climate change, clean technologies and greener growth across
APEC members also implement initiatives to the region by lower tariffs on environmental
increase energy efficiency and promote goods.
sustainable management of forest and marine ▪ APEC has helped urban planners develop low-
resources. carbon model town plans for a series of cities
▪ The forum adapts to allow members to deal with throughout the Asia-Pacific.
important new challenges to the region’s ▪ These cities are reducing their carbon footprint
economic well-being. This includes ensuring by adopting a set of carbon emission reduction
disaster resilience, planning for pandemics, and targets and energy efficient initiatives from solar
addressing terrorism. panels to electric vehicles.

Achievements of APEC Inclusive growth

Growth and Development of the Region ▪ APEC has launched a wide variety of initiatives
that have helped foster SME development in the
▪ As a result of APEC’s work, there has been a Asia-Pacific region.
surge in growth in the region, with real GDP ▪ In 2005, the APEC SME Innovation Center was
increasing from USD 19 trillion in 1989 to USD established in Korea to help improve the
42 trillion in 2015. competitiveness of SMEs in the region through
▪ Further, per capita income in the region rose by hands-on business consulting.
74% ▪ In 2013, The APEC Start-up Accelerator Network
was launched to promote entrepreneurship and
Promotion of regional economic integration and innovation by connecting technology start-ups
trade: with funding and mentors.

▪ The APEC removed trade barriers between Cooperation and Consensus

members, harmonized standards and regulations,
and streamlined customs procedures which have ▪ APEC operates as a cooperative, multilateral
enabled goods to move more easily across borders. economic and trade forum.
▪ To improve behind-the-border barriers to trade,
APEC has been working to foster transparency,

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▪ Member economies participate on the basis of ▪ Shrinking Economy due to Covid – The Asia-
open dialogue and respect for views of all Pacific Economic Cooperation (APEC) region
participants. is expected to post a 2.7 per cent economic
▪ In APEC, all economies have an equal say and decline in 2020 due to the impact of Covid-
decision-making is reached by consensus. 19.
▪ There are no binding commitments or treaty ▪ Rising Unemployment – The region’s
obligations. Commitments are undertaken on a unemployment rate is projected to rise to 5.4 per
voluntary basis and capacity building projects cent in 2020 from 3.8 per cent in 2019, or an
help members implement APEC initiatives. additional 23.5 million workers being unemployed
▪ APEC's structure is based on both a "bottom-up" in 2020.
and "top-down" approach.
▪ Four core committees and their respective working India and APEC
groups provide strategic policy recommendations
to APEC Leaders and Ministers who annually set ▪ For several years, India has aspired to become a
the vision for overarching goals and initiatives. member of the Asian-Pacific Economic
▪ The working groups are then tasked with Cooperation Organisation (APEC).
implementing these initiatives through a variety of
▪ However, India’s request for becoming a formal
APEC-funded projects. member of the group, first made in 1993 and then
▪ Members also take individual and collective in 2007 is yet to be accepted.
actions to carry out APEC initiatives in their
individual economies with the assistance of APEC
capacity building projects. Why India has not got membership in APEC ?

Issues and challenges ▪ India was denied APEC membership in 2007 on

the ground that its economy was not integrated
into the global system.
▪ Lack of consensus on including any new member
▪ Fears of disrupting consensus procedures
Trade War
▪ Extra-regional status of India might undermine
APEC’s geographic net beyond the Pacific Rim.
▪ large trade deficit of India
Creation of Shrinking
▪ APEC members do not view India’s politics and
Sub- Economy policies as supportive of wide regional
Regional due to
Agreements Covid integration and wider trade options.

Why APEC needs India ?

Rising Unemployment
▪ India is the region's third largest and now fastest
growing major economy. APEC economies,
which account for 60 percent of global GDP, are
experiencing sluggish growth and must look for
▪ Trade War - APEC members have a conflicting opportunities to bring new markets
aims and objectives towards world trade. Rising ▪ India is also projected to be the world's third
protectionism and US-China Trade war, largest economy by 2030 and will need well over
threatens economic growth in the region. The 2018 $1 trillion of investment in infrastructure over the
APEC Summit, to produce a joint communique next decade.
because of tensions between the US and China ▪ With Trans-Pacific Partnership (TPP) trade
over trade and security issues. agreement becoming into a reality APEC needs to
▪ Creation of Sub-Regional Agreements - Many reinvent itself.
APEC economies seek to reach sub-regional free ▪ On the supply side, India's labor force, which
trade agreements has a negative impact on the will be the largest in the world by 2030, will help
roles APEC was originally expected to play in the offset the impact of aging populations and
region. The negotiations over Trans-Pacific shrinking work forces in APEC economies.
Partnership and Regional Comprehensive ▪ India's trade with APEC economies, which has
Economic Partnership (RCEP) had further grown rapidly over the last fifteen years will
undercut the importance of APEC. grow further once it joins APEC.

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▪ A forward-looking commitment to India's initiative needed to boost stubbornly sluggish
economic future is precisely the kind of bold regional and global growth.
Advantages for India
▪ Membership in APEC would allow India to negotiate trade, integrate with the global economy, and help boost
growth.
▪ India’s inclusion in APEC will give a boost to its ‘Act East Policy’ and will further integrate the Indian economy
into the Asia-Pacific economic milieu.
▪ Apart from facilitating greater regional economic integration, APEC promotes the development of small and
medium enterprises in the member countries by removing hurdles for trading across borders.
▪ APEC mechanisms and best practices will help Indian officials and businesses become more competitive and
better prepared for the changing global economy.
▪ Inclusion of India in APEC will act as catalyst for further economic reforms in the country.

Way Forward

▪ The APEC member countries should work together to ensure their collective and individual interests are best
represented.
▪ At a time of global and regional geopolitical disturbances, Covid pandemic situation and domestic challenges,
it is of immense importance to find a wise solutions that are designed to promote sustainable and equitable
growth and development according to the specific circumstances of the Asia-Pacific region.
▪ With the rise of India as one of the global economic power and its changing regional economic and political
influence, necessitates that India is included APEC. This would ensure a free and open trade and investment
in the Indo-Pacific region and foster growth.

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 CH-2 ASSOCIATION OF SOUTH EAST ASIAN NATION (ASEAN)
Basics and Backgrounds ▪ 2008 – ASEAN Charter comes into force and
becomes a legally binding agreement.
▪ The Association of Southeast Asian Nations, or ▪ 2015 – Launch of ASEAN Community.
ASEAN, was established on 8 August 1967 in
Bangkok, Thailand, with the signing of the ASEAN Community
ASEAN Declaration (Bangkok Declaration) by
the Founding Fathers of ASEAN. ▪ At the 9th ASEAN Summit in 2003, the ASEAN
▪ The motto of ASEAN is “One Vision, One Leaders resolved that an ASEAN Community
Identity, One Community”. shall be established.
▪ At the 12th ASEAN Summit in January 2007, the
Member Countries Leaders affirmed their strong commitment to
accelerate the establishment of an ASEAN
▪ Founding Members Indonesia, Malaysia,
Community by 2015 and signed the Cebu
Philippines, Singapore and Thailand. Declaration on the Acceleration of the
▪ Brunei Darussalam (1984), Vietnam (1995), Lao Establishment of an ASEAN Community by
PDR and Myanmar (1997), and Cambodia 2015.
(1999), joined the ASEAN later. ▪ The ASEAN Community is comprised of three
▪ ASEAN Secretariat – Indonesia, Jakarta. pillars, namely
The ASEAN Political-
Security Community

ASEAN Economic
Community

ASEAN Socio-Cultural
Community

Goals and Objective

▪ To accelerate the economic growth, social

progress and cultural development in the region
Evolution of ASEAN through joint endeavors in the spirit of equality
and partnership in order to strengthen the
▪ 1967 – ASEAN was established with the signing foundation for a prosperous and peaceful
of the ASEAN Declaration (Bangkok community of Southeast Asian Nations
Declaration) by its founding fathers. ▪ To promote regional peace and stability through
▪ 1990s – Membership doubled after the changing abiding respect for justice and the rule of law in
conditions in the region following the end of the the relationship among countries of the region and
Vietnam War in 1975 and the Cold War in 1991. adherence to the principles of the United Nations
Addition of Brunei (1984), Vietnam (1995), Charter
Laos and Myanmar (1997), and Cambodia ▪ To promote active collaboration and mutual
(1999). assistance on matters of common interest in the
▪ 1995 – Members signed a deal to create a nuclear- economic, social, cultural, technical, scientific
free zone in Southeast Asia. and administrative fields
▪ 1997 – Adoption of ASEAN Vision 2020. ▪ To provide assistance to each other in the form of
▪ 2003 – Bali Concord II for the establishment of training and research facilities in the educational,
an ASEAN Community. professional, technical and administrative
▪ 2007 – Cebu Declaration, to accelerate the spheres
establishment of ASEAN Community by 2015.

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▪ To collaborate more effectively for the greater ▪ ASEAN Plus Three: The consultative group
utilization of their agriculture and industries, the initiated in 1997 brings together ASEAN’s ten
expansion of their trade, including the study of members, China, Japan, and South Korea.
the problems of international commodity trade, ▪ East Asia Summit (EAS): First held in 2005, the
the improvement of their transportation and summit seeks to promote security and prosperity
communications facilities and the raising of the in the region and is usually attended by the heads
living standards of their peoples of state from ASEAN, Australia, China, India,
▪ To promote Southeast Asian studies; and Japan, New Zealand, Russia, South Korea, and
▪ To maintain close and beneficial cooperation the United States. ASEAN plays a central role as
with existing international and regional the agenda-setter.
organizations with similar aims and purposes, and
explore all avenues for even closer cooperation India and ASEAN
among themselves. ▪ India’s focus on a strengthened and multi-faceted
relationship with ASEAN is an outcome of the
Significance significant changes in the world’s political and
economic scenario since the early 1990s and
• It is the 3rd largest market in the world, larger India’s own march towards economic
than EU and North American markets. liberalisation. India’s search for economic space
• It is the 6th largest economy in the world, 3rd in resulted in the ‘Look East Policy’. The Look East
Asia. Policy has today matured into a dynamic and
• The Free-trade agreements (FTAs) with China, action oriented ‘Act East Policy.
Japan, South Korea, India, Australia and New ▪ India’s relationship with ASEAN has emerged as a
Zealand. key cornerstone of our foreign policy.
▪ The relationship has evolved from the ‘Look East
• The Fourth most popular investment destination
Policy’ enunciated in early 1990s which led India
globally.
to become a Sectoral Partner of ASEAN in 1992,
a Dialogue Partner in 1996 and a Summit-level
Fundamental Principles Partner in 2002.
▪ The India-ASEAN Strategic Partnership
In their relations with one another, the ASEAN acquired a new momentum with the announcement
Member States have adopted the following of “Act-East Policy” in the 12th Summit in 2014.
fundamental principles, as contained in the Treaty of ▪ India has a separate Mission to ASEAN and the
Amity and Cooperation in Southeast Asia (TAC) of EAS in Jakarta.
1976: ▪ India and ASEAN already has 25 years of
1. Mutual respect for the independence, Dialogue Partnership, 15 years of Summit Level
sovereignty, equality, territorial integrity, and interaction and 5 years of Strategic Partnership
national identity of all nations with ASEAN.
2. The right of every State to lead its national ▪ Economic Cooperation
existence free from external interference, 1. ASEAN is India's fourth largest trading
subversion or coercion partner.
3. Non-interference in the internal affairs of one 2. India's trade with ASEAN stands at approx.
another 10.6% of India's overall trade.
4. Settlement of differences or disputes by peaceful 3. India's export to ASEAN stands at 11.28% of our
manner total exports. The ASEAN-India Free Trade Area
5. Renunciation of the threat or use of force; and has been completed.
6. Effective cooperation among themselves 4. ASEAN India-Business Council (AIBC) was set
up in 2003 to bring key private sector players from
ASEAN-led Forums India and the ASEAN countries on a single
platform.
▪ ASEAN Regional Forum (ARF): The 27 5. Major exports from India to the region: Ships,
member multilateral grouping was developed in boats, floating structures, mineral fuels, mineral
1993 to facilitate cooperation on political and oils and meat.
security issues to contribute to regional 6. Major imports: telecom equipment, electrical
confidence-building and preventive diplomacy. machinery, mineral fuels, mineral oils and animal
or vegetable fats and oils.

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▪ Socio-Cultural Cooperation: Programmes to through Cooperatives, Training Course on Organic
boost People-to-People Interaction with ASEAN, Certification for Fruits and Vegetables etc.
such as inviting ASEAN students to India, Special ▪ In the S&T field, we have projects such as
Training Course for ASEAN diplomats, Exchange ASEAN-India S&T Digital Library, ASEAN-India
of Parliamentarians, etc. Virtual Institute for Intellectual Property, ASEAN-
▪ Funds: Financial assistance has been provided to India Collaborative Project on S&T for Combating
ASEAN countries from the following Funds:
Malaria, ASEAN-India Programme on Quality
1. ASEAN-India Cooperation Fund
2. ASEAN-India S&T Development Fund
Systems in Manufacturing, ASEAN-India
3. ASEAN-India Green Fund Collaborative R&D Project on Mariculture, Bio-
▪ Delhi Declaration: To identify Cooperation in the mining and Bioremediation Technologies etc
Maritime Domain as the key area of cooperation
ASEAN-India Plan of Action
under the ASEAN-India strategic partnership.
▪ Delhi Dialogue: Annual Track 1.5 event for ▪ A Plan of Action (2004-2010) was developed to
discussing politico-security and economic issues implement the ASEAN-India Partnership for
between ASEAN and India.
Peace, Progress and Shared Prosperity.
▪ ASEAN-India Centre (AIC): To undertake
policy research, advocacy and networking ▪ The 3rd Plan of Action for 2016-2020 has been
activities with organizations and think-tanks in finalized after successful implementation of
India and ASEAN. previous one and a list of prioritized activities
▪ Political Security Cooperation: India places chalked out for 2016-18.
ASEAN at the centre of its Indo-Pacific vision of ▪ It envisages functional cooperation in a range of
Security and Growth for All in the Region. sectors in the political, economic and socio-
▪ Apart from ASEAN, India has taken other policy cultural spheres with the objective of capacity
initiatives in the region that involve some building and development, particularly to
members of ASEAN like BIMSTEC, MGC etc. narrow the development gaps between ASEAN
India is also an active participant in several member states under their Initiative for ASEAN
regional forums like the Asia-Europe Meeting Integration (IAI) programme.
(ASEM), East Asia Summit (EAS), ASEAN ▪ The financing of POA projects is done through
Regional Forum (ARF), ASEAN Defence ASEAN-India Fund, Science & Technology
Ministers' Meeting + (ADMM+) and Expanded Development Fund and Green Fund.
ASEAN Maritime Forum (EAMF).
▪ Connectivity: ASEAN-India connectivity is a Delhi Dialogue
priority for India as also the ASEAN countries. Delhi Dialogue is a premier annual track 1.5 event
In 2013, India became the third dialogue partner of since 2009 to discuss politico-security and economic
ASEAN to initiate an ASEAN Connectivity issues between ASEAN and India. Nine editions of
Coordinating Committee-India Meeting. While Delhi dialogue have been held so far at New Delhi. It
India has made considerable progress in has evolved into a premier event for taking stock of
implementing the India-Myanmar-Thailand global geo-political movements and their impact on
Trilateral Highway and the Kaladan ASEAN-India relations and making recommendations
Multimodal Project, issues related to increasing for future direction of this landmark relationship.
the maritime and air connectivity between ASEAN
and India and transforming the corridors of East Asia Summit Conference On Maritime
connectivity into economic corridors are under Security Cooperation
discussion. A possible extension to India-
Myanmar-Thailand Trilateral Highway to ▪ Recently, India hosted East Asia Summit (EAS)
Cambodia, Lao PDR and Viet Nam is also under maritime conference in Chennai.
consideration. ▪ This is the fourth in a series of EAS Maritime
Security Conferences organised by the Indian
▪ In Agriculture, we are cooperating with ASEAN
government.
by way of projects such as Exchange of Farmers,
▪ Earlier three were, (New Delhi in 2015), (Goa in
ASEAN-India Fellowships for Higher Agricultural 2016) and (Bhubaneswar in 2018).
Education in India and ASEAN, Exchange of
Agriculture Scientists, Empowerment of Women

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 New China
▪ It was organized by Ministry of External Affairs, Zealan
d
in partnership with the governments of Australia
and Indonesia. Australi South
▪ It is to provide a platform for free and open a Korea
dialogue among all the EAS partners on various
issues of maritime security cooperation, and to India Japan
come up with useful suggestions on tackling
challenges in the maritime domain in a
cooperative manner.
▪ The RCEP negotiations were launched between
the Ten ASEAN member states and six ASEAN
East Asia Summit (EAS) FTA partners during the 21st ASEAN Summit
and related summits in Phnom Penh, Cambodia
▪ It is leader-led forum at which all key partners in November 2012.
meet to discuss the full range of political, security
and economic challenges facing the Indo-Pacific,
India Exit from RCEP
and has an important role to play in advancing
closer regional cooperation.
▪ The EAS has 18 members - the ten ASEAN ▪ Recently India opt out from RCEP trade deal.
countries (Brunei, Cambodia, Indonesia, Laos, ▪ India held that it will not become part of RCEP
Malaysia, Myanmar, the Philippines, Singapore, until “significant outstanding issues” are
Thailand, Vietnam) along with Australia, China, resolved.
India, Japan, New Zealand, the Republic of Korea, ▪ Reasons for India’s Withdrawal
the United States and Russia. 1. Trade deficit: India’s merchandise trade deficit
▪ This represents 54 per cent of the world's with the RCEP grouping hit $105 billion in FY19
population and accounts for around 58 per cent of (60% of its total deficit).
global GDP. 2. Dumping of Chinese Goods
▪ The inaugural EAS was held in Kuala Lumpur 3. Non-acceptance of Auto-trigger Mechanism
on 14 December 2005. India has been a part of this 4. Protection of Domestic Industry
process since its inception in 2005. 5. Lack of Consensus on Rules of Origin
▪ The 14th EAS was held in Bangkok, Thailand in 6. Dismantling import duties pushed by ASEAN
November 2019. members. It would mean unhindered access to
Chinese products in Indian market.
7. will expose India’s agriculture and industry to
ASEAN & RCEP indiscriminate competition
8. India unwilling to cater to demands from some
▪ The Regional Comprehensive Economic RCEP countries to open up procurement segment.
Partnership (RCEP) is a mega-regional
economic agreement being negotiated since 2012, India’s Vision for Indo-Pacific
between ASEAN and Free Trade Agreement
(FTA) member partners. In the Shangri La Dialogue, India embraced the
▪ The Association of Southeast Asian Nations concept of Indo-Pacific and highlighted following
(ASEAN) (ASEAN+1 FTAs) has free trade points-
agreements with six partners namely, ▪ It stands for a free, open, inclusive region, which
embraces all in a common pursuit of progress and
▪ To broaden and deepen the engagement among prosperity. It includes all nations in this
parties and to enhance parties' participation in the geography as also others beyond who have a stake
economic development of the region, the leaders in it.
of the 16 participating countries established the ▪ Southeast Asia is at its Centre and ASEAN
RCEP. central to its future.
▪ The RCEP was built upon the existing ASEAN+1 ▪ Evolve, through dialogue, a common rules-based
FTAs with the spirit to strengthen economic order for the region. These rules and norms should
linkages and to enhance trade and investment- be based on the consent of all, not on the power of
related activities as well as to contribute to the few.
minimizing development gap among the parties.

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▪ Rather than growing protectionism, India seeks for 4. Economic and Other Possible Areas of
a level playing field for all. India stands for open Cooperation.
and stable international trade regime.
▪ Connectivity is vital and India is doing its part, by Challenges
itself and in partnership with others like Japan –
in South Asia and Southeast Asia, in the Indian ▪ Currently, the grouping is facing a great challenge
Ocean, Africa, West Asia and beyond. amid the strategic competition for influence in the
▪ India’s view can be summarized into five “S” in Asia-Pacific between the United States and
Hindi: China. Recently, countries in Southeast Asia have
been forced to choose sides.
Samman
▪ As the U.S. and China increase their strategic
Samvad rivalry and start a new cold war, ASEAN is locked
up in a strategic tug-of-war that could destabilize
Shanti
the whole region, if it fails to navigate the
Sahyog geopolitical challenge effectively.
▪ Moreover, ASEAN countries tend to have
Samriddhi
divergent interests and priorities. Each member
faces their own unique social, economic, and
political challenges.
▪ ASEAN is not free from internal and external
security challenges either. Within the region, there
are border disputes and conflicts, illegal
ASEAN Outlook on the Indo-Pacific migration, ethnic crises, and issues surrounding
the life of the Mekong River, which has
▪ Recently, the Association of Southeast Asian increasingly made headlines in the last few years.
Nations (ASEAN) ▪ Outside of the region, there are serious challenges
▪ has adopted the ‘ASEAN Outlook on the Indo- concerning the territorial disputes in the South
Pacific’. China Sea and other concerns regarding
▪ ASEAN Outlook reinforces the ASEAN-centered ASEAN’s role and relevance in the region and
regional beyond.
▪ architecture which is not aimed at creating new ▪ ASEAN is also constrained by other key
mechanisms challenges, including corruption, demographic
▪ or replacing existing ones. changes, uneven social development, disparities
▪ It intends to enhance ASEAN’s Community in economic development and technology
building process adoption and environmental degradation.
▪ and to strengthen and give new momentum for ▪ imbalance between many ASEAN nations and
existing India because many of them are industrialized
▪ ASEAN-led mechanisms, including the East Asia with manufacturing bases primed for exports,
Summit while India’s export sector remains weak and the
▪ (EAS), the ASEAN Regional Forum (ARF) etc. government’s focus has shifted to boosting
▪ It enumerates the four functional areas through manufacturing domestically.
which ▪ India’s capacity to provide development
▪ ASEAN believes collaboration can be tangibly assistance, market access and security guarantees
advanced: remains limited
1. Maritime cooperation
2. Connectivity
3. Sustainable development
Way Forward

▪ ASEAN must put in extra efforts to sustain and enhance its existing successes and achievements. The bloc has
been regarded as a catalyst for peace; therefore, it is vital that ASEAN increase its strengths and step up to
promote rule of law in the region.
▪ ASEAN must also promote transparency and work to reduce corruption. At the same time, this association
needs to enhance closer coordination and regional connectivity.

189
▪ More collective efforts are required to address the development gap, especially regarding health care, education,
technology adoption, and infrastructure development.
▪ More importantly, ASEAN must work hard to enhance the development of good governance, inclusive growth,
sustainable development, and democracy, which is in decline. It needs to work together to help less developed
members to catch up with others in the region.
▪ Closer attention and investment should be placed on the development of the knowledge-based and digital
economy.
▪ ASEAN needs to work collaboratively rather than individually, particularly with regard to a regional response to
the COVID-19 pandemic.
▪ ASEAN must support and embrace regionalism and multilateralism by constructively and genuinely working
together to achieve common goals and realize the ASEAN Community Vision.

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 CH-3 BRICS
Basics and Backgrounds ▪ The first BRIC Summit took place in 2009 in the
Russian Federation and focused on issues such as
▪ BRICS is an acronym for the grouping of the reform of the global financial architecture.
world’s leading emerging economies, namely ▪ South Africa was invited to join BRIC in
Brazil, Russia, India, China and South Africa. December 2010, after which the group adopted
▪ The BRICS members are known for their the acronym BRICS.
significant influence on regional affairs. ▪ South Africa subsequently attended the Third
▪ Since 2009, the BRICS nations have met annually BRICS Summit in Sanya, China, in March 2011.
at formal summits.
▪ Originally the first four were grouped as "BRIC" Salient Features
before the induction of South Africa in 2010.
▪ Brazil hosted the most recent 11th BRICS
summit on 13–14 November 2019.
Member Countries

▪ An estimated total population of about 3.21

billion, or about 27% of the world land surface
and 41% of the world population.
▪ These five nations had a combined nominal GDP
▪ Founding Members were Brazil, Russia, India & of US$18.6 trillion, about 23.2% of the gross
China. world product, a combined GDP (PPP) of
▪ Later South Africa joined in the group in 2010 around US$40.55 trillion (32% of World's GDP
PPP), and an estimated US$4.46 trillion in
Evolution of BRICS combined foreign reserves.
▪ It’s an emerging investment market and global
▪ The acronym "BRICS" was initially formulated in power bloc.
2001 by economist Jim O'Neill, of Goldman
Sachs, in a report on growth prospects for the Goals and Objective
economies of Brazil, Russia, India and China –
which together represented a significant share of ▪ The BRICS seeks to deepen, broaden and
the world's production and population. intensify cooperation within the grouping and
▪ In 2006, the four countries initiated a regular among the individual countries for more
informal diplomatic coordination, with annual sustainable, equitable and mutually beneficial
meetings of Foreign Ministers at the margins of development.
the General Debate of the UN General Assembly ▪ BRICS takes into consideration each member’s
(UNGA). growth, development and poverty objectives to
▪ This successful interaction led to the decision that ensure relations are built on the respective
the dialogue was to be carried out at the level of country’s economic strengths and to avoid
Heads of State and Government in annual competition where possible.
Summits. ▪ BRICS is emerging as a new and promising
political-diplomatic entity with diverse

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 objectives, far beyond the original objective of ❖ BRICS member political and security
reforming global financial institutions. cooperation is aimed at achieving peace,
security, development and cooperation for a
Areas of Cooperation more equitable and fair world.
❖ BRICS provides opportunities for sharing policy
advice and exchanges of best practices in terms of
domestic and regional challenges as well as
advancing the restructuring of the global political
architecture so that it is more balanced, resting on
the pillar of multilateralism.
❖ BRICS is utilised as a driver for South Africa’s
foreign policy priorities including the pursuit of
the African Agenda and South-South
Cooperation.

▪ Cooperation Mechanism

Cooperation among members is achieved through:

❖ Track I: Formal diplomatic engagement between

▪ Economic Cooperation the national governments.
❖ Track II: Engagement through government-
❖ There are rapidly growing trade and investment affiliated institutions, e.g. state-owned enterprises
flows between BRICS countries as well as and business councils.
economic cooperation activities across a range of ❖ Track III: Civil society and People-to-People
sectors. engagement.
❖ Agreements have been concluded in the areas of
Economic and Trade Cooperation; Innovation
Impact of BRICS on Institutional Reforms
Cooperation, Customs Cooperation; strategic
cooperation between the BRICS Business
Council, Contingent Reserve Agreement and the ▪ The main reason for co-operation to start among
New Development Bank. the BRICs nation was the financial crises of 2008.
❖ These agreements contribute to realization of the The crises raised doubts over sustainability of the
shared objectives of deepening economic dollar-dominated monetary system.
cooperation and fostering integrated trade and ▪ The BRICs called for the “the reform of
investment markets. multilateral institutions in order that they reflect
the structural changes in the world economy and
▪ People-to-People exchange the increasingly central role that emerging
markets now play”.
▪ BRICs managed to push for institutional reform
❖ BRICS members have recognized the need for
which led to International Monetary Fund
strengthening People-to-People exchanges and to
(IMF) quota reform in 2010. Thus the financial
foster closer cooperation in the areas of culture,
crises had momentarily reduced western
sport, education, film and youth.
legitimacy and briefly let the BRICs countries
❖ People-to-People exchanges seek to forge new
become “agenda setters” in multilateral
friendships; deepen relations and mutual
institutions.
understanding between BRICS peoples in the spirit
of openness, inclusiveness, diversity and mutual
learning. New Development Bank
❖ Such People to people exchanges include the
Young Diplomats Forum, Parliamentarian ▪ NDB is headquartered in Shanghai.
Forum, Trade Union Forum, Civil BRICS as ▪ At the Fourth BRICS Summit in New Delhi
well as the Media Forum. (2012) the possibility of setting up a New
Development Bank was considered to mobilize
▪ Political and Security Cooperation resources for infrastructure and sustainable
development projects in BRICS and other

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 emerging economies, as well as in developing Partnership on New Industrial Revolution
countries. (PartNIR).
▪ During the Sixth BRICS Summit in Fortaleza ▪ ‘BRICS outreach to Africa’ and ‘BRICS Plus’
(2014) the leaders signed the Agreement formats: BRICS plus format initiated at Xiamen
establishing the New Development Bank (NDB). Summit in 2017 by inviting a few countries from
▪ Fortaleza Declaration stressed that the NDB will different regions was carried forward in
strengthen cooperation among BRICS and will Johannesburg Summit also.
supplement the efforts of multilateral and
regional financial institutions for global Importance for India
development thus contributing to sustainable and
balanced growth. ▪ India can benefit from collective strength of
▪ NDB’s key areas of operation are clean energy, BRICS by way of consultation and cooperation
transport infrastructure, irrigation, sustainable on economic issues of mutual interests, as well
urban development and economic cooperation as topical global issues, such as, international
among the member countries. terrorism, climate change, food and energy
▪ The NDB functions on a consultative mechanism security, reforms of global governance institutions,
among the BRICS members with all the member etc.
countries possessing equal rights. ▪ India remains engaged with the other BRICS
countries on its NSG membership.
Contingent Reserve Arrangement ▪ BRICS is an integral part of India’s grand
strategy, and a vehicle in India’s journey from
▪ Considering the increasing instances of global being a norm taker to a norm shaper.
financial crisis, BRICS nations signed BRICS ▪ It offers greater bargaining space as India seeks
Contingent Reserve Arrangement (CRA) in to gain more prominence in institutions of global
2014 as part of Fortaleza Declaration at Sixth governance, and shape them in the liberal
BRICS summit. international tradition with a southern ethos.
▪ The BRICS CRA aims to provide short-term ▪ The NDB will help India to raise and avail
liquidity support to the members through resources for their infrastructure and sustainable
currency swaps to help mitigating BOP crisis development projects. The NDB has approved its
situation and further strengthen financial first set of loans, which included a loan of US$
stability. 250 million in respect of India for Multitranche
▪ The initial total committed resources of the CRA Financing Facility for Renewable Energy
shall be one hundred billion dollars of the Financing Scheme’.
United States of America (USD 100 billion).
▪ It would also contribute to strengthening the global Role of BRICS in Multi-Polar World
financial safety net and complement existing
international arrangements (IMF). ▪ BRICS needs to acquire weight in the
international space so as to respond to
▪ Interbank Local Currency Credit Line contemporary realities. It needs the engagement of
Agreement: all the stakeholders
▪ The economic-financial sphere stands out as one
It is a non-binding umbrella agreement which of the most promising areas of activity for the
would serve as an enabler to enter into bilateral BRICS.
agreements with member banks subject to national ▪ High growth rate, economic potential and
laws, regulations and internal policies of the demographic development are putting the BRICS
signatories. increasingly in a leading position in setting the
Local currencies usage will promote mutually global agenda and having a greater say in the
beneficial economic cooperation, mitigate global governance.
currency risks, increase trade, and facilitate ▪ Also, BRICS as a group are expected to step up
companies in accessing the BRICS markets. their role and extend to pressing peace and
security challenges, from terrorism, piracy and
▪ Johannesburg Declaration: nuclear non-proliferation to regional security in
▪ Importance of 4th Industrial Revolution: It North Africa and the Middle East.
recommends the establishment of BRICS ▪ In areas of Climate change BRICS as a grouping
works on common agreed principles.

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▪ Hearing voices of 40% of world is a step towards India’s stand in the BRICS Summit 2019
equality.
▪ India put forward the concern of increasing
Johannesburg Declaration terrorism in the world.
▪ As per PM Modi’s speech in the summit, the
▪ Importance of 4th Industrial Revolution: It menacing threat of terrorism has caused the
recommends the establishment of BRICS world economy of huge value of $1 trillion.
Partnership on New Industrial Revolution ▪ He proposed various steps that are needed to
(PartNIR). be taken in to account in order to overcome
▪ ‘BRICS outreach to Africa’ and ‘BRICS Plus’ this loss.
formats: BRICS plus format initiated at Xiamen ▪ India invited the leaders of the participating
Summit in 2017 by inviting a few countries from countries to invest in India’s infrastructure
different regions was emulated in Johannesburg development which will eventually help in
Summit also. increasing the trade participation of India.
▪ India also proposed to hold the first meeting
11th BRICS Summit of BRICS Water Ministers in India.

▪ 11th BRICS Summit was held in Brasilia, XII BRICS Summit, 2020
Brazil.
▪ At a time when the five countries are heading ▪ XII BRICS Summit to Be Held on 17
in different directions politically, they found November 2020 Via Video conference
ways to build a common vision for the ▪ The theme of the Meeting of the Leaders of
world’s economic future BRICS countries is “BRICS Partnership for
▪ Emphasis on multilateralism and a joint Global Stability, Shared Security and
statement at Brasilia that decried “unilateral Innovative Growth”.
and protectionist” actions. ▪ The main purpose of the Russian BRICS
▪ Member nations held dialogues on cementing Chairmanship in 2020, as it is for a multifaceted
ties in trade, innovation, technology and cooperation between the BRICS countries, is to
culture. contribute to raising living standards and quality
▪ The grouping decided to open a regional office of life our peoples.
of the New Development Bank (NDB) in ▪ This year the five countries have continued close
India. strategic partnership on all the three major
▪ Terrorism was one of the priority areas for pillars: peace and security, economy and
BRICS 2019. finance, cultural and people-to-people
exchanges.

Challenges
Key Focus Areas
▪ The marked dominance of big three Russia-
China-India (RIC) is challenge for the BRICS as
it moves ahead.
▪ To become a true representative of large emerging
markets across the world, BRICS must become
pan-continental. Its membership must include
more countries from other regions and
continents.
▪ The BRICS will need to expand its agenda for
increasing its relevance in the global order. As of
now, climate change and development finance,
aimed at building infrastructure dominate
agenda.
▪ As BRICS moves forward foundational principles
of BRICS i.e. respect for sovereign equality and
pluralism in global governance are liable to be

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 tested as the five member countries pursue their ▪ China’s efforts to co-opt nation states, which are
own national agendas. integral to its Belt and Road Initiative, into a
▪ The military standoff between India and China broader political arrangement has potential to
on the Doklam plateau and Ladakh, which has cause conflict among BRICS members especially
effectively brought to an end the naive notion that China and India.
a comfortable political relationship is always
possible amongst the BRICS members.
Way Forward

▪ BRICS should promote comprehensive development of all states both big and small and
enhanced mutually beneficial cooperation among them on the basis of shared interests.
▪ A civil society dialogue is much needed.
▪ BRICS nations should strive for peaceful and politico-diplomatic settlement of crisis and conflict in
various regions of the world.
▪ BRICS, being one of the pillars of the emerging fairer polycentric world order, plays an important
stabilising role in global affairs.
▪ Democratization of international issues agreements on global agendas should be reached with the
widest and equal participation of all stakeholders and be based on universally recognised legal norms.
▪ The principle of respect for cultural and civilizational diversity of the world should be a top priority.
▪ In the storming ocean of world politics, BRICS can contribute significantly in maintaining
international stability and ensuring global economic growth and becoming a united centre of the
multipolar world.

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CH-4 BAY OF BENGAL INITIATIVE FOR MULTI-SECTORAL
TECHNICAL AND ECONOMIC COOPERATION (BIMSTEC)
Basic and Backgrounds ▪ With the admission of Nepal and Bhutan in 2004,
the name of the grouping was changed to ‘Bay of
▪ The Bay of Bengal Initiative for Multi-Sectoral Bengal Initiative for Multi-Sectoral Technical and
Technical and Economic Cooperation Economic Cooperation’ (BIMSTEC).
(BIMSTEC) was established in 1997 Bangkok
Declaration with secretariat in Dhaka. Objective
▪ Its members lie in the littoral and adjacent areas of
the Bay of Bengal constituting a contiguous ▪ Technical and economic cooperation among
regional unity. members.
▪ BIMSTEC not only connects South and ▪ Encouraging the spirit of equality and
Southeast Asia, but also the ecologies of the partnership.
Great Himalayas and the Bay of Bengal. ▪ Promoting active collaboration and mutual
▪ It mainly aims to create an enabling environment assistance in the areas of common interests of the
for rapid economic development; accelerate member countries
social progress; and promote collaboration on ▪ Accelerating support for each other in the fields of
matters of common interest in the region. education, science, and technology, etc.
▪ Act as a bridge between South and South East
Member Countries Asia and represents a reinforcement of relations
among these countries
▪ Bangladesh, India, Myanmar, Sri Lanka, Thailand,
Nepal and Bhutan (No Maldives, Afghanistan, Important Facts
Pakistan)
▪ The BIMSTEC countries are home to a population ▪ Bridge between South and South East Asia and
of around 1.5 billion, approximately 21 % of represents a reinforcement of relations among
global population, with a cumulative GDP of these countries.
US$ 2.5 trillion. The annual GDP growth rate ▪ Platform for intra-regional cooperation between
has averaged around 6 %. SAARC and ASEAN members.
▪ Home to around 1.5 billion people that constitute
Permanent Secretariat & Chairmanship around 22% of the global population.
▪ With a combined gross domestic product (GDP) of
▪ The BIMSTEC Permanent 2.7 trillion economy, BIMSTEC Member States
Secretariat at Dhaka was opened in 2014 and have been able to sustain an average 6.5%
India contributes 33% of its expenditure. economic growth trajectory in the last five years.
▪ The current Secretary General of the BIMSTEC ▪ A fourth of the world’s traded goods cross the bay
is Ambassador Mohammad Shahidul Islam every year.
from Bangladesh and the former Secretary General
was Sumith Nakandala from Sri Lanka.
Previous BIMSTEC Summit
▪ The BIMSTEC uses the alphabetical order for the
Chairmanship. The Chairmanship of the
BIMSTEC has been taken in rotation commencing ▪ 1st Summit (2004) - Bangkok (Thailand)
with Bangladesh (1997–1999). ▪ 2nd Summit (2008) - New Delhi (India)
▪ 3rd Summit (2014) - Nay Pyi Daw (Myanmar)
Evolution ▪ 4th Summit (2018) – Kathmandu (Nepal)
▪ 5th Summit (2022) – Colombo (Sri Lanka)
▪ This sub-regional organization came into being in
1997 through the Bangkok Declaration. Priority Areas
▪ Initially, it was formed with four Member States
with the acronym ‘BIST-EC’ (Bangladesh, India, ▪ A sector-driven cooperative organization – total
Sri-Lanka and Thailand Economic Cooperation). 14 sectors.
▪ It became renamed ‘BIMST-EC’ in 1997, ▪ Each Country leads some of the sector.
following the inclusion of Myanmar. ▪ India is the lead country for following sectors:

196
 2017 in New Delhi, to facilitate coastal shipping
within 20 nautical miles of the coastline in the
Transportation & Communication region to boost trade between the member
countries.
▪ Compared to the deep sea shipping, coastal ship
require smaller vessels with lesser draft and
Tourism involve lower costs.

Environment & Disaster Management

Counter-Terrorism & Transnational Crime

Institutional Mechanisms

▪ BIMSTEC Summit – highest policymaking body

in BIMSTEC process and is comprised of heads of
state/government of member states. ▪ Once the agreement becomes operational after it is
▪ Ministerial Meeting – second apex policy-making ratified, a lot of cargo movement between the
forum of BIMSTEC attended by the member countries can be done through the cost
External/Foreign Ministers of Member States. effective, environment friendly and faster
▪ Senior Officials’ Meeting – represented by Senior coastal shipping routes.
Officials of Foreign Ministries of the Member ▪ On 7th and 8th of November, 2019, the first
States. ever BIMSTEC Conclave of Ports summit was
▪ BIMSTEC Working Group – attended by held in Visakhapatnam, India.
Ambassadors of BIMSTEC Member Countries to ▪ The main aims of this summit is providing a
Bangladesh or their representatives on a monthly platform to strengthen maritime interaction,
basis at the BIMSTEC Secretariat in Dhaka. port-led connectivity initiatives and sharing best
▪ Business Forum & Economic Forum – the two practices among member countries.
important forums to ensure active participation of
private sector. Principles of BIMSTEC

BIMSTEC Free Trade Area Framework ▪ Sovereign Equality

▪ Territorial Integrity
Agreement
▪ Political Independence
▪ No-interference in Internal Affairs
▪ The BIMSTEC Free Trade Area Framework
▪ Peaceful Co- existence
Agreement (BFTAFA) has been signed by all
▪ Mutual Benefit
member nations to stimulate trade and investment
▪ Constitute an addition to and not be a substitute for
in the parties, and attract outsiders to trade with
bilateral, regional or multilateral cooperation
and invest in the BIMSTEC countries at a higher
involving the Member States.
level.
▪ Subsequently, the "Trade Negotiating
Committee" (TNC) was set up, with Thailand as
Connectivity Project
the permanent chair, to negotiate in areas of trade
in goods and services, investment, economic co- 1. Kaladan Multimodal Project – links India and
operation, trade facilitations and technical Myanmar
assistance for LDCs.
▪ The BIMSTEC Coastal Shipping ▪ Agreement was signed in 2008. Construction
Agreement draft was discussed on 1 December began in 2010. But inadequate funds and poor

197
 planning led to delays. Objective is to complete enable movement of passenger and cargo
the project in 2019. vehicles across borders among the four
▪ The project will provide an alternate access route countries.
to the North Eastern region of India. ▪ Bhutan has not yet ratified the pact for its entry
▪ The project aims to create a multi-modal mode of to come into force.
transport for shipment of cargo from the eastern ▪ However, Bhutan had given its consent for the
ports of India to Myanmar as well as to the BBIN MVA to enter into force amongst the other
North-Eastern part of India through Myanmar. 3 countries i.e. Bangladesh, India and Nepal,
▪ It will connect Kolkata port with Sittwe port in who have already ratified it.
Myanmar by sea, and then link Sittwe seaport to ▪ The main objective of the agreement is to provide
Lashio in Myanmar via Kaladan river via inland seamless people-to-people contact and enhance
water transport and then from Lashio to Mizoram economic interaction by facilitating cross border
in India by road transport. movement of people and goods.
▪ When completed, the KMTT will shorten the ▪ The Asian Development Bank (ADB) has been
current time taken to transport goods from Kolkata providing technical, advisory, and financial
to Mizoram by three-four days, and the distance by support to the BBIN MVA initiative as part of its
around 950 km. KMMT is hailed as “Future assistance to the South Asia Sub regional
gateway to South East Asia”. Economic Cooperation (SASEC) program, a
projects-based economic cooperation initiative that
2. Asian Tri-lateral Highway brings together the BBIN countries, Maldives,
Sri Lanka and more recently, Myanmar.
▪ The 1360 kms long India-Myanmar-Thailand
Trilateral Highway is an initiative pertaining to BIMSTEC Disaster Management Exercise
India, Myanmar and Thailand. India is undertaking (BIMSTEC-DMEx) 2020
construction of two sections of the Trilateral
Highway in Myanmar namely,
▪ The 2nd BIMSTEC Disaster Management
1. Kalewa-Yagyi road section
Exercise (BIMSTEC-DMEx) 2020 is a 3-day
2. Tamu-Kyigone-Kalewa (TKK) road section
exercise that discussed standardization of
▪ The above mentioned projects are funded by
protocol, formulation of policy and guidelines
Government of India under Grant Assistance to
for protection of heritage sites during disasters
the Government of Myanmar.
and their conservation post-disaster.
▪ The India-Myanmar-Thailand Trilateral
▪ It was attended by five (out of seven) member
Highway is a highway under construction under
nations Bangladesh, India, Myanmar, Sri Lanka
India’s Look East Policy that will connect Moreh,
and Nepal at Puri, Odisha. Thailand and
India with Mae Sot, Thailand via Myanmar.
Bhutan did not participate.
▪ The road will boost the trade and commerce in the
▪ National Disaster Response Force hosted
ASEAN-India Free Trade Area, and with the
BIMSTEC- DMEx 2020.
rest of Southeast Asia. India has also proposed
extending the highway to Cambodia, Laos and
Tourism:
Vietnam.
▪ Tourism has rich potential in the BIMSTEC
region, as this region is home to ancient
Look East Policy
civilizations with deep civilization and cultural
▪ India’s Look East Policy is an effort being made
linkages, several historic monuments, and natural
by the Indian government to cultivate and
splendour.
strengthen economic and strategic relations
▪ BIMSTEC Tourism Information Centre was
with the nations of Southeast Asia in order to
established in July 2007 in Delhi to create a
solidify its standing as a regional power.
Network of Tour Operators among the BIMSTEC
▪ This policy also serves to position India as
Member States to promote tourism in the region
a counterweight to the strategic influence of the
including the Buddhist Tourist Circuit and luxury
People’s Republic of China in the region.
cruise.
▪ India hosted the First Meeting of this Network on
3. Bangladesh-Bhutan-India-Nepal (BBIN) Motor
7 July 2017 in New Delhi where it was decided to
Vehicles Agreement
work on common marketing strategies, creation of
the brand BIMSTEC for tourism; creation of
▪ Bangladesh, Bhutan, India and Nepal (BBIN)
BIMSTEC specific products; promoting Public
had signed a framework MVA in June 2015 to

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 Private Partnerships; developing and sharing of ▪ Neglect by member states - It seems that India
common safety protocols and development of has used BIMSTEC only when it fails to work
common circuits and cruise tourism. through SAARC in the regional setting and other
major members like Thailand and Myanmar are
Significance for India focused more towards ASEAN than BIMSTEC.
▪ Broad Focus Areas - The focus of BIMSTEC is
▪ Allows India to pursue three core policies: very wide, including 14 areas of cooperation like
o Neighborhood First - primacy to the connectivity, public health, agriculture etc. It is
country’s immediate periphery; suggested that BIMSTEC should remain
o Act East - connect India with Southeast committed to small focus areas and cooperate in
Asia; and them efficiently.
o Economic development of India’s north ▪ Same projects reappearing as “fresh initiatives” in
eastern states – by linking them to the serial joint statements over recent years. Our
Bay of Bengal region via Bangladesh and capacities and institutions continue to lag behind
Myanmar. our ambitions. It is time to move from an event-
▪ Allows India to counter China’s creeping influence oriented to a process-driven approach
in countries around the Bay of Bengal due to the ▪ Bilateral Issues between Member Nations -
spread of its Belt and Road Initiative. Bangladesh is facing one of the worst refugee
▪ A new platform for India to engage with its crisis of Rohingyas from Myanmar who are
neighbors with South Asian Association for fleeing prosecution in the state of Rakhine in
Regional Cooperation (SAARC) becoming Myanmar. There is a border conflict between
dysfunctional because of differences between Myanmar and Thailand.
India and Pakistan. ▪ No FTA - BIMSTEC FTA was negotiated in
▪ BIMSTEC Leader's Retreat The BIMSTEC 2004, talks on it are yet to be concluded.
Leader's Retreat hosted by India in Goa in October
2016 served as an important impetus to BIMSTEC vs. SAARC
BIMSTEC. The “Agenda of Action” - A robust
policy agenda agreed during the Retreat was meant SAARC BIMSTEC
to translate the shared commitment into delivery of A regional organisation Inter-regional organisation
specific, people oriented initiatives to achieve looking into South Asia. connecting South Asia
greater connectivity, trade, people-to-people and South East Asia
contacts, and sustainable use of resources which is Established in 1985; a Established in 1997 in the
being steadily implemented. product of the Cold War post-Cold War period.
era.
Criticisms Member countries suffer Members maintain
for mistrust and reasonably friendly
▪ India’s engagement with them has been mostly suspicion. relations.
episodic and ad hoc. We have not created the Suffers from regional Core objective is the
capacity to engage with our neighbors on a politics. improvement of economic
sustained basis and at multiple levels. cooperation among
▪ BCIM & Belt and Road Initiative - The countries.
formation of another sub-regional initiative beside Asymmetric power Balancing of power with
China’s ambitious Belt and Road Initiative, the balance. the presence of Thailand
Bangladesh-China-India-Myanmar (BCIM) and India on the bloc.
Forum, with the proactive membership of China, Intra-regional trade only Intra-regional trade has
has created more doubts about the exclusive 5%. increased around 6% in a
potential of BIMSTEC. decade.
▪ Delivery Deficit - India’s own resources are
limited, but more than that its record of delivery
on commitments continues to be abysmal.
Way Forward

▪ Forge practical cooperation in six areas, to start with: trade and investment, connectivity, energy, tourism,
counter-terrorism, and Blue Economy.

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▪ Security challenges must be addressed through a realistic programme, but the grouping’s principal focus must
remain on social and economic development.
▪ BIMSTEC needs to produce a few visible results or successes in the short term. Concluding the protracted
negotiations for a FTA in goods, and later, services, and investment, is the way forward.
▪ Without an appropriate FTA, the grouping will continue to be perceived as an empty shell.
▪ BIMSTEC must now move into a rapid implementation stage, for which the necessary resources should be
injected into the Dhaka-based secretariat.
▪ It will be prudent to divert resources from less critical areas to BIMSTEC to realise its undisputed potential as a
sub-regional organization and a strategic vehicle for India’s foreign-policy goals.

200
 CH-5 GROUP OF 8/GROUP 7
Basics and Backgrounds ▪ There are no formal criteria for membership, but
participants are all highly developed democracies.
▪ The aggregate GDP of G-7 member states makes
up nearly 50% of the global economy and 10% of
the world’s population.

Structure
▪ The group does not have a permanent
secretariat, or offices for its members.
▪ The presidency of the group rotates annually
among member countries, with each new term
▪ The Group brings together eight major industrial beginning on 1 January of the year.
economies of the world for consultation and policy ▪ The rotation order is: France, the United States,
coordination at the highest level. the United Kingdom, Russia (suspended),
▪ The origins of the Group can be traced back to Germany, Japan, Italy, and Canada.
November 1975 when the then President of ▪ The country holding the presidency is responsible
France, Velary Giscard d’ Estaing, and the for planning and hosting a series of ministerial-
German Chancellor, Helmut Schmidt, invited the level meetings, leading up to a mid-year summit
US, Britain, Italy and Japan for a meeting at the attended by the heads of government.
Chateau of Rambouillet, France, to discuss the ▪ The president of the European Commission
economic crisis resulting from the rise of oil participates as an equal in all summit events.
prices.
▪ Another member, Canada, attended the meeting of Summit Participation
the group in June 1976 in San Juan, Puerto Rico, ▪ Summits are held annually and hosted on a
and the Group of Seven (G-7) was formally rotation basis by the group's members. The host
created. country not only holds the G7 presidency but
▪ The G-7 became an international forum for also sets the agenda for the year.
discussing various issues like economic growth, ▪ Invitation to Global leaders are sent by host
inflation, unemployment, trade ailments and other nation to participate in summit as special invitees.
problems confronted by the developed nations. Countries like China, India,
▪ At the 20th G-7 summit, held in Naples, Italy, in Mexico, and Brazil have attended summit at
July 1997, at the summit in Denver, the US, Russia various occasions.
became a full-fledged member, and the G-7 was ▪ The leaders of important international
renamed as the Group of Eight (G-8) or the Group organizations like European Union, IMF,
World Bank and the United Nations are also
of Seven plus One (G-7 + 1).
invited.
▪ In March 2014, Russia was cast out of the Group
of 8 due to its involvement in the 2014 Crimea
crisis in Ukraine. Sherpas

Objective ▪ The groundwork for the Summit, including matters

to be discussed and follow-up meetings, is done by
▪ The Group aims at deliberating on and evolving the “sherpas”, who are generally personal
strategies to deal with the major economic and representatives or members of diplomatic staff
political international issues. such as ambassadors.
Members Facts about G-7
▪ The G-8 Constitutes of Canada, France, Germany, ▪ Leading export countries
Italy, Japan, Russia, the UK and the USA. ▪ Largest gold reserves

201
▪ Largest nuclear energy producers 1. fighting inequality of opportunity, promoting in
▪ Top contributors to the UN budget particular gender equality, access to education and
high quality health services
G-7 Vs G-20 2. reducing environmental inequality
3. strengthening the social dimension of globalization
▪ The G-20 is a larger group of countries and was 4. taking action for peace against security threats and
formed in 1999, which also includes G7 members terrorism
and was formed in response to a felt need to bring 5. tapping into the opportunities created by digital
more countries on board to address global technology and artificial intelligence (AI).
economic concerns.
▪ Apart from the G-7 countries, the G-20 comprises India at G7
Argentina, Australia, Brazil, China, India,
Indonesia, Mexico, Russia, Saudi Arabia, South ▪ PM Modi is a participant at the 45th G7 summit at
Africa, South Korea, and Turkey. the special invitation of French President
Emmanuel Macron, as India is not a member of
▪ The G20 members represent around 80% of the
the group of seven.
world’s economic output, two-thirds of the global ▪ The Ministry of External Affairs (MEA) referred
population and three-quarters of international to the invitation as a “reflection of the personal
trade. chemistry” between the two leaders and also
recognition of India as a major economic power.
G-7 and FATF ▪ PM Modi reached Biarritz, France for the summit
▪ In response to mounting concern over money on August 25 after his three-nation tour of France,
UAE and Bahrain.
laundering, the Financial Action Task Force on
Money Laundering (FATF) was established by the
Key takeaways from the G7 summit
G-7 groping in Paris in 1989.
▪ In 2001 its mandate expanded to include terrorism 1. G7 might consider reinstating Russia
financing.
▪ Recognising the threat posed to the banking ▪ US President Donald Trump pressed the G7 group
system and financial institutions, the G-7 Heads of to reinstate Russia as a permanent member of the
State or Government and President of the grouping, saying it would be better to have Russia
European Commission convened the Task Force inside the group than outside.
from the G-7 member States, the European ▪ However, no consensus was reached on whether or
Commission and eight other countries. not to invite Russia to the next year’s G7 summit
▪ The FATF’s primary objective is to ensure that in the United States.
“financial systems and the broader economy are ▪ French President Emmanuel Macron said that he
protected from the threats of money laundering and German Chancellor Angela Merkel would be
and the financing of terrorism and proliferation, organizing a summit in the coming weeks with the
thereby strengthening financial sector integrity and Russian and Ukrainian leaders to obtain results on
contributing to safety and security.” the Ukraine crisis.
Significance
2. Trump open to talks with Iran
▪ G7 is capable of setting the global agenda because
decisions taken by these major economic powers ▪ Donald Trump said that he was open to meet
have a real impact. Iran’s President under the right circumstances to
▪ Thus, decisions taken at the G7 are not legally end the confrontations over the 2015 nuclear deal
binding, but exert strong political influence. and that talks were underway to see how countries
could open up credit lines to keep Iran’s economy
2019 G7 Summit afloat.
▪ Trump, however, ruled out compensating for
▪ Presided over by France, will focus on fighting
losses suffered by Iran and made crippling
inequality.
▪ France has identified the following five objectives sanctions.
for the Summit:

202
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3. Trump opens doors to a possible trade deal ▪ US President Donald Trump vowed to work out a
with China very big trade deal, bigger than ever with the
United Kingdom after Brexit.
▪ The G7 leaders had expressed concern during their ▪ The US president stated that the British would lose
summit meeting that trump’s trade war with China the anchor
could spiral outward and called for a sensible
resolution. 8. US-Japan trade agreement
▪ However, US President Donald Trump in a
welcoming move opened the path for a possible ▪ US President Donald Trump announced locking of
trade deal with China following days of an intense a new trade agreement with Prime Minister Shinzo
trade war. Abe of Japan.
▪ The US-China trade war has had a damaging effect ▪ The deal aims to secure market access for several
on the global economy and overall GDP. American agricultural goods and Japan has agreed
to purchase large sums of corn from the US.around
4. Trump skips session on ‘climate and their ankle after leaving the EU.
biodiversity’
Proposal for G-7 Expansion
▪ The G7 summit this year laid increasing focus on ▪ U.S. President Donald Trump announced that he
climate change amid a backdrop of the burning would like to expand G-7 to a G-11, by adding
Amazon, a month after the Earth recorded its India, Russia, South Korea and Australia.
hottest month ever. ▪ US President followed up his announcement with
▪ However, US President Donald Trump who invitations to these four country’s leaders, to
claimed to be an environmentalist in a press attend the 2020’s G-7 summit in the U.S.
conference later notably skipped the climate crisis
meeting of the G7. Reaction of countries on G-11 plan
▪ Trump defended his absence saying that the US
wealth is based on energy exports and he is not ▪ India has welcomed the decision and commended
going to lose it on dreams. Trump for his “creative and far-sighted” decision
to expand the format of the grouping to keep up
5. India- Pakistan tensions expected to lighten with the new realities of the “post-COVID
world”.
▪ Australia and South Korea have also welcomed
▪ Indian Prime Minister Narendra Modi while
the invitation,
interacting with the media alongside US President ▪ Russia, that lost its membership of the grouping in
Donald Trump said that all issues between India 2014 over its annexation of Crimea, has stated it
and Pakistan are bilateral and that is why India would attend “if treated as an equal”
does not don’t want to trouble any third country.
▪ Modi reiterated that India and Pakistan were Consequences of G-11 plan for India
together before 1947 and he was confident that the
two nations can discuss and resolve these issues ▪ The proposed G-11 grouping would recognise
bilaterally. India’s place amongst the world’s richest nations.
Membership will acknowledge India’s global
6. G7 leaders support Hong Kong’s autonomy voice
▪ It will provide a platform for India to address its
▪ The G7 leaders confirmed the existence and concerns like terrorism and ensure that world work
importance of the Sino-British Joint Declaration of towards it
1984 on Hong Kong and called for violence to be ▪ It helps increase the soft power of India
▪ Exclusion of China from G-11 means possible
avoided.
strengthening of India’s alliance against China
▪ This is step in democratization of international
7. US-UK trade deal institutions which are facing the criticism of being
biased in favour of developed countries

203
Critical Analysis of G-11 Plan no single country or bloc of countries has the
political and economic leverage—or the will—to
▪ Improves Effectiveness: Expansion is needed to drive a truly international agenda’.
improve the groupings effectiveness as a ▪ In relation to legitimacy and political clout, the
multilateral forum to arrive at consensus on issues G20 has one undeniable advantage over the G7.
like climate change, security contributions, Iran, Namely, the G20 represents a wider range of
etc countries, and a far greater proportion of the
▪ Against G-8+ 5: China, India, Brazil, Mexico and world’s population, with the G7 representing
South Africa, were invited regularly to G-8 approximately 10%, whilst the G20 accounts for
summits as an outreach by the developed world to two-thirds. Linked to this is the argument that the
the five emerging economies. The G-11 plan G7 only discusses issues which are relevant to the
leaves out all these members except India G7 countries, whereas the G20’s members exhibit
▪ Potential fora for Cold War: The summit a far greater variety in their geography, politics
appears aimed at fuelling a new Cold War between and cultures, encouraging a wide-ranging agenda,
the U.S. and China. and therefore a far greater mandate when
▪ Adds fire to US-China tensions: US and China attempting to address global issues.
are fighting each other over trade, IPR, 5G ▪ G7 has no permanent secretariat to look after the
Technology, Hong Kong, South China Sea, decisions taken at the meetings.
Climate issues and recently over origins of ▪ It’s decisions are also not binding on the members.
Coronavirus. This action by US will further widen ▪ G7 countries are most developed countries in the
their rift world and these are also responsible for the
▪ Long Way: As host, Mr. Trump can invite any climate change and global warming. But these
country as a G-7 special invitee, but changing its countries failed to deliver their commitments
composition will require the approval of the other under Kyoto Protocol. USA, the lage economy in
members. the world even withdrew from Kyoto Protocol and
▪ Opposition from within G-7: There are some Paris Agreement.
concerns by European countries over Russia
joining the group, which could derail the entire G-
11 plan
▪ Short term Challenges: It is unclear when the
summit will actually be held, given the November
polls in the U.S. This might derail the plan in
initial stages itself.
Criticism of G7 group

▪ At the first ‘G6’ meeting in 1975, it was clear that

all of the world’s economic powers were in
attendance. The countries present were specially
selected, as they were the major advanced
economies, and they had the financial impetus to
provide an effective solution to the most pressing
issue of the moment: the looming global economic
crisis. However, the G7’s current share of the
world’s GDP is 29% lower than that which it
owned in the mid-1980’s.
▪ The loss of economic power represents a great
problem for many of the countries involved in the
G7. We now live ‘in a G-Zero world, one in which

204
 CH-6 GROUP OF 20

Basics and Backgrounds ▪ Policy coordination between its members in order

to achieve global economic stability, sustainable
growth
▪ To promote financial regulations that reduce risks
and prevent future financial crises
▪ To create a new international financial
architecture.

Structure
▪ The G20 Presidency rotates annually according
to a system that ensures a regional balance over
time.
▪ For the selection of presidency, the 19 countries
are divided into 5 groups, each having no more
than 4 countries.
▪ The presidency rotates between each group. Every
year the G20 selects a country from another group
to be president.
▪ The G20 (or Group of Twenty) is an international India is in Group 2 which also has Russia,
South Africa, and Turkey.
forum for the governments and central
▪ The G20 does not have a permanent secretariat
bank governors from 19 countries and
or Headquarters. Instead, the G20 president is
the European Union (EU). responsible for bringing together the G20 agenda
▪ Founded in 1999 with the aim to discuss policy in consultation with other members and in
pertaining to the promotion of response to developments in the global economy.
international financial stability, the G20 has ▪ TROIKA: Every year when a new country takes
expanded its agenda since 2008 and heads of on the presidency (in this case Argentina 2018),
government or heads of state, as well as finance it works hand in hand with the previous presidency
ministers, foreign ministers and think tanks, (Germany, 2017) and the next presidency (Japan,
have periodically conferred at summits ever since. 2019) and this is collectively known as TROIKA.
▪ It seeks to address issues that go beyond the This ensures continuity and consistency of the
responsibilities of any one organization. group’s agenda.
▪ Collectively, the G20 economies account for
around 90% of the gross world product (GWP), Classification
80% of world trade (or, if excluding EU intra- The work of G20 is divided into two tracks
trade, 75%), two-thirds of the world
population, and approximately half of the world 1. The finance track comprises all meetings with
land area. G20 finance ministers and central bank governors
and their deputies. Meeting several times
Members throughout the year they focus on monetary and
fiscal issues, financial regulations, etc.
▪ Membership of the G20 consists of 19 individual 2. The Sherpa track focuses on broader issues such
countries plus the European Union. The EU is as political engagement, anti-corruption,
represented by the European Commission and by development, energy, etc.
the European Central Bank. ▪ Each G20 country is represented by its Sherpa;
▪ Spain as a permanent, non-member invitee, also who plans, guides, implements, etc. on behalf of
attends leader summits. the leader of their respective country. (Indian
Sherpa, at the G20 in Argentina, 2018 was Shri
Objective Shaktikanta Das)

205
 concept in the Income Tax Act for taxation of
Cooperation non-residents in India or global digital
companies.
▪ In Toronto in 2010, leaders declared it to be the ▪ Boycotting Osaka Track- India, South Africa,
premier forum for global economic co-operation. and Indonesia have boycotted the “Osaka Track"
▪ The work of G20 members is supported by several on the “digital economy”, as it overtly
international organisations that provide policy undermines “multilateral" principles of consensus-
advice. These organisations include: based decisions in global trade negotiations, and
1. The Financial Stability Board (FSB). The FSB, denies "policy space" for digital-industrialisation
which was established by G20 leaders following in developing countries. It is an initiative launched
the onset of the global financial crisis, by Japan's Prime Minister Shinzo Abe that seeks
2. The International Labour Organization (ILO). the removal of
3. The International Monetary Fund (IMF). ▪ Prohibitions on data localisation and urges
4. The Organisation for Economic Co-operation nations to negotiate rules on data flows, cloud
and Development (OECD) computing among others. Countries such as US
5. United Nations (UN) and Europe have supported it.
6. World Bank ▪ India has also supported the fight against fugitive
7. The World Trade Organization (WTO) economic offenders, need for WTO reforms and
▪ The G20 also regularly engages with non- keeping a close watch on global current account
government sectors. Engagement groups from imbalances.
business (B20), civil society (C20), labour (L20),
think tanks (T20) and youth (Y20) are holding Osaka Track
major events during the year, the outcomes of
which will contribute to the deliberations of G20 ▪ It is proposal by Japan that seeks the removal of
leaders. prohibitions on data localisation and urges nations
to negotiate rules on data flows, cloud computing
Agenda of G-20 among others. India, South Africa, and Indonesia
have boycotted the “Osaka Track" on the “digital
The G20 focuses on a broad agenda of issues of global economy”.
importance, although, issues pertaining to the global ▪ The 2019 G20 Summit in Osaka discussed eight
economy dominate the agenda, additional items have themes which are crucial to ensure Global
become more important in recent years, like Sustainable Development, that are Global
Economy; Trade and Investment; Innovation;
▪ Financial markets Environment and Energy; Employment; Women’s
▪ Tax and fiscal policy Empowerment; Development; and Health.
▪ Trade
▪ Agriculture G-20’s Role in fighting Covid-19
▪ Employment
▪ Energy ▪ Today, when the global pandemic COVID-19 is
▪ Fight against corruption making its way into the annals of the world, G20
▪ Advancement of women in job market needs a more humane touch.
▪ 2030 agenda for Sustainable development ▪ Realising the dream of a virus-free world will take
▪ Climate Change extra effort from every G20 nation.
▪ Global Health ▪ A “reformed multilateralism” is required for
▪ Anti-terrorism making the systems more effective to meet
▪ Inclusive entrepreneurship present-day challenges as well as making them
more inclusive.
14th G-20 summit ▪ A humanitarian call by Indian PM for the
empathy to nurture within states is an endeavour
The 14th G-20 summit was held in Osaka, Japan.
in the right direction.
Important takeaways for India at G-20 ▪ In the Seoul Summit in 2010, the theme ‘Shared
Growth Beyond Crisis’ was central. This vividly
▪ Taxing global digital companies- India has made explains the core agenda of the grouping but
a strong case for adoption of "significant undermines the humanitarian issues which need
economic presence" concept for taxing global urgent attention.
digital companies. India had introduced this

206
▪ The role of G20 will become more active if the ▪ Therefore, as a larger chunk of G20 integrates a
leaders will put the parlance into practice by larger population, the role of G20 has become
bringing COVID-19 impact and humanitarian more and more fierce and integral. A
agenda into centrality. comprehensive and collective endeavour is a need
for an hour for the institution to live.

Relevance of G-20

▪ Influence on the policies of the countries around the world- It allows the leaders of the world’s major
economies to work together to lift growth in mutually-supportive ways and align their domestic policies to the
decisions taken by the grouping across Ministerial level meetings and Summits.
▪ It provides good platform for emerging economies like India, China, Brazil, or Turkey for addressing
structural domestic problems of slowing stagnating industrial productivity, job creation, and deflating export
prices that requires greater economic cooperation with countries in Europe, the US and Canada.
▪ Helps in reshaping the governance of global finance- as done by developing strict rules on the "too big to fail"
problem, increasing the lending capacity of the International Monetary Fund (IMF) and collecting richer
information on the shadow banking system.
▪ Helps in strategic balancing among countries- such platforms provide opportunities for countries to conduct
various bilateral and plurilateral meetings such as JAI (Japan-America-India), RIC (Russia-India- China) which
tries to address conflicting interests of various groupings on one platform.

207
 CH-7 GROUP OF 4
Basics and Backgrounds

▪ The Big Four, also known as G4, refers

to France, Germany, Italy and the United
Kingdom. ▪ The need for an early reform of the Council
▪ These countries are considered major European including the expansion of both the permanent
powers and they are the Western and non-permanent categories of membership to
European countries individually represented as full enhance its legitimacy.
members of the G7, the G8, the G10 and ▪ The current composition of the 15 nation Council
the G20. does not reflect the changed global realities.
▪ France, Germany, Italy and the United ▪ The ministers reiterated their support for Africa’s
Kingdom have been referred to as the "Big Four representation in both categories of membership
of Europe" since the interwar period. in a reformed and expanded Security Council.
▪ The term G4 was used for the first time when ▪ India and G-4 nations voiced concern over the
French President Nicolas Sarkozy called for a lack of substantive progress in the long pending
meeting in Paris with Italian Prime Security Council reform.
Minister Silvio Berlusconi, Prime Minister of ▪ It is time to finally initiate text-based
the United Kingdom Gordon Brown and negotiations to safeguard the legitimacy and
Chancellor of Germany Angela Merkel to credibility of the powerful UN organ.
consider the response to the financial crisis during
the Great Recession. G4 on UNSC Reforms
▪ The Organisation for Economic Co-operation
and Development describes them as the "Four ▪ Ensuring greater representation for Africa:
Big European Countries". Africa needs to be represented in both the
permanent and non-permanent categories of
G-4 Meeting Key Highlights UNSC to correct the historical injustice against
this continent with regard to its under-
▪ They stressed the need to safeguard the representation in the Security Council.
legitimacy and credibility of UN organ which ▪ Enhanced role of developing countries and of
deals with international peace and security. major contributors to the UN: To make UNSC
▪ The need for the reform is underlined by the fact more legitimate, effective and representative, it is
that the current composition of the Council does needed to increase the number of permanent (from
not reflect the changed global realities. 5 to 11) and non-permanent (from 10 to 14) seats.
▪ This is critical because the Security Council takes ▪ The permanent seats shall be elected in the
the lead in determining the existence of a threat to following manner: Two from African States; Two
the peace or act of aggression. from Asian States; One from Latin American and

208
 Caribbean States ; One from Western European G-4 Nations and Coffee Club
and Other States.
▪ Non-permanent members shall be elected ▪ Uniting for Consensus (UFC) is a movement,
according to the following pattern : One from nicknamed the Coffee Club.
African States ; One from Asian States ; One from ▪ It aims to counter the bids for permanent seats
Eastern European States ; One from Latin proposed by G4 nations.
American and Caribbean State ▪ It was developed in the 1990s.
▪ The UNSC reforms proposed earlier had been ▪ Most members are middle-sized states who
opposed by the five permanent members (P5) of opposed bigger regional powers grabbing
UNSC as they demanded veto power for new permanent seats in the UN Security Council.
members as well (Razali Plan). However, later the ▪ The prime movers of the club include Italy, Spain,
new countries decided to forego the veto power for Australia, Canada, South Korea, Argentina and
new countries which was accepted by P5 countries Pakistan.
(Razali Reform Plan). ▪ It consists of nations that are selectively opposed
to the G4 members due to regional rivalry such as
Razali reform plan Pakistan against India, Italy against Germany,
Argentina and Mexico against Brazil, etc.
▪ Under the plan, the UNSC would have five new
permanent members without veto powers, besides Present structure of the UNSC
four more non-permanent members taking the
council’s strength to 24. ▪ At present, the UNSC comprises five permanent
members and 10 non-permanent member
Text-Based Negotiations countries which are elected for a two-year term
by the General Assembly of the UN.
▪ The G4 will work with other reform-minded ▪ The five permanent members are Russia, the UK,
countries and groups to start text-based China, France and the United States.
negotiations (TBN) ▪ These countries can veto any substantive
▪ India is a proponent of TBN at the UN. Countries resolution.
opposed to UNSC reform, including China, are
hesitant to have TBN for intergovernmental Way Forward
negotiations on the grounds that the matter is too
sensitive for text. ▪ Speeding reform process: G4 have offered to
initially forgo veto powers as permanent members
Concerns over IGN in a reformed security council as a bargaining chip
to get the reform process moving.
▪ Two sessions in February and March 2020 of ▪ Expanding only the non-permanent categories, as
Inter-Governmental Negotiations (IGN) on suggested by UFC, would only worsen “the
UNSC reform were adjourned due to Covid-19, imbalance of influence” in the council and does
which could have taken place virtually. “grave injustice to Africa’s aspirations for
▪ The countries expressed concern that IGN lacks equality”
the necessary openness and transparency and is ▪ The permanent members should realise that a
constrained by flawed working methods. more democratic and representative Security
▪ IGN should also have included a reflection of Council would be better-equipped to address
the Common African Position as enshrined in global challenges.
the Ezulwini Consensus and the Sirte ▪ Meaningful reform of the council to make it
Declaration. more representative and democratic is inevitable to
The Ezulwini Consensus (2005) is a position on enable it to take a comprehensive, coordinated and
international relations and reform of the United coherent approach to peace and security,
Nations, agreed by the African Union. It calls for a sustainable development, and human rights
more representative and democratic Security challenges.
council, in which Africa, like all other world
regions, is represented.
▪ The Sirte Declaration (1999) was the resolution
adopted to establish the African Union.

209
 CH-8 INDIAN OCEAN RIM ASSOCIATION (IORA)

Basics and Backgrounds IORA strengthens cooperation and dialogue with

Member States namely:
▪ Commonwealth of Australia, People's Republic of
▪ The Indian Ocean Rim Association is an inter- Bangladesh, Union of Comoros, Republic of India,
governmental organization which was Republic of Indonesia, Islamic Republic of Iran,
established on 7 March 1997. Republic of Kenya, Republic of Madagascar,
▪ The Indian Ocean Rim Association (IORA) is a Malaysia, Republic of Maldives, Republic of
dynamic inter-governmental organization aimed Mauritius, Republic of Mozambique, Sultanate of
at strengthening regional cooperation and Oman, Republic of Seychelles, Republic of
sustainable development within the Indian Singapore, Federal Republic of Somalia , Republic
Ocean region through its 22 Member States and of South Africa, Democratic Socialist Republic of
10 Dialogue Partners. Sri Lanka, United Republic of Tanzania, Kingdom
▪ It is a regional forum, tripartite in nature, of Thailand, United Arab Emirates and Republic
bringing together representatives of of Yemen.
Government, Business and Academia, for ▪ All sovereign States of the Indian Ocean Rim are
promoting co-operation and closer interaction eligible for membership of the Association. To
among them. become members, States must adhere to the
▪ IORA is based on the principles of Open principles and objectives enshrined in the Charter
Regionalism for strengthening Economic of the Association.
Cooperation particularly on Trade Facilitation
and Investment, Promotion as well as Social Dialogue Partners
Development of the region.
▪ IORA’s apex body is the Council of Foreign ▪ Dialogue Partners refer to individual sovereign
Ministers (COM) which meets annually to discuss states and not members of IORA, but with a
the developments of IORA. special interest and/or capacity to contribute to
▪ The United Arab Emirates is the current Chair IORA, particularly in the areas of common
of IORA form October 2019-2021. interest.
▪ The Vice-Chair will be the People’s Republic of ▪ Dialogue Partners provide valuable assistance in
Bangladesh which would take Chair as from
the field of technology transfer, environmental
October 2021-2023.
▪ Its Secretariat is based in Cyber City, Ebène, issues, the promotion of trade and investment,
Mauritius. technical cooperation and assistance to the Special
Fund.
Members ▪ The Dialogue Partners of IORA are People’s
Republic of China, Arab Republic of Egypt,
France Republic, Republic of Germany, Republic
of Italy, Japan, Republic of Korea, Republic of
Turkey, United Kingdom and United States of
America.

Objectives
▪ To promote sustainable growth and balanced
development of the region and member states
▪ To focus on those areas of economic cooperation
which provide maximum opportunities for
development, shared interest and mutual
benefits
▪ To promote liberalization, remove impediments
▪ Promoting sustained growth and balanced
and lower barriers towards a freer and enhanced
development within the Indian Ocean region,

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 flow of goods, services, investment, and ▪ Encouraging less developed member countries to
technology within the Indian Ocean rim. host various IORA events.

Priority areas Challenges

Indian Ocean Rim Association (IORA) has identified IORA faces several obstacles that prevent it from
eight priority areas, namely: growing into a highly successful and influential
▪ Maritime security, regional organization; these issues range from
▪ Trade and investment facilitation, structural deficiencies to geopolitical conflicts existing
▪ Fisheries management, outside IORA that permeate the organization and
▪ Disaster risk reduction, prevent cooperation.
▪ Academic and scientific cooperation and Diverse States, Diverse Objectives
▪ Tourism promotion and cultural exchanges.
▪ Blue Economy
▪ Women’s Economic Empowerment ▪ Though IORA's large membership affords it with
the ability to understand perspectives of a wide
array of nations in the Indian Ocean Region, it also
The Indian Ocean Dialogue (IOD)
creates differences in objectives, in what
▪ The Indian Ocean Dialogue (IOD) is a flagship successful maritime security cooperation would
initiative of the Indian Ocean Rim Association look like, among member states.
(IORA). ▪ Economically and developmentally, IORA brings
▪ It is originated in the 13th Council of Ministers together some of the world's richest countries - the
meeting, held in 2013 in Perth, Australia. United Arab Emirates, Singapore, and Australia -
▪ The first IOD was held in Kerala, India in 2014, with some of the poorest, such as Mozambique,
▪ Areas of discussion includes economic and island nations with very low GDPs, such as
cooperation, maritime safety and security, blue Seychelles; this creates uneven benefits from
economy, human assistance and disaster relief, etc. participation in IORA projects and can lead to
▪ The 6th Indian Ocean Dialogue will be held in economic competition and resentment among
New Delhi on 13th and 14th December 2019. member states.

IORA Sustainable Development Program Overlapping Regional Organizations

(ISDP)
▪ IORA faces competition with other regional and
▪ The ISDP is a project-based program intended to international organizations for member states'
meet the needs of the Member States of the IORA. attention and investments; in fact, 14 such bodies
▪ Project proposals are formulated by the Member have IORA member states in their membership.
countries in collaboration with IORA Secretariat.
▪ As an instrument of sustainable development, the Geopolitical Disputes
ISDP Program is expected to strengthen regional
cooperation and forge new partnerships within the
▪ Interstate conflicts have greatly hindered the
IORA Member States and with Dialogue Partners.
strengthening of IORA, most notably through
India's intentional exclusion of Pakistan from
ISDP Objectives IORA membership.
▪ Though the India-Pakistan dispute has generally
▪ Encouraging lesser developed member countries to been terrestrial, it has manifested itself in IORA,
participate in IORA. as noted above; in the maritime realm; and in other
▪ Encouraging capacity building, peer-to-peer regional maritime organization.
learning and sharing of information to IORA ▪ Pakistan and India have recently engaged in an
member countries. arms race for nuclear submarine technology, with
▪ Enhancing and strengthening bonds amongst each state having equipped its navy with nuclear
member countries. weapons to some extent.
▪ Extending opportunities to lesser developed ▪ In addition, recent Chinese involvement in the
member countries to share their experience and Indian Ocean Region, particularly through the Belt
expertise in specific areas that would benefit their and Road Initiative, has further sparked Indian
economies.

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 distrust of a key nation in the strengthening of ▪ A Declaration on Preventing and Countering
IORA, in this case, a dialogue partner. Terrorism and Violent Extremism was also
▪ Though experts contend that Chinese involvement adopted last year.
in the Indian Ocean Region has the potential to
greatly benefit IORA proposals, especially those Obstacles for India
related to the Blue Economy, India sees such
involvement as an attempt to shift power in the ▪ At the time of Independence, India was at the heart
region from India to China and pushes back of trade and capital flows across the Indian Ocean,
accordingly. deeply connected to the rest of the littoral through
multiple corridors, and the very centre of regional
19th Indian Ocean Rim Association (IORA) Council security management.
of Ministers Meeting ▪ India marginalised itself from the region’s
economic and security dynamics due to its inward
▪ The 19th Indian Ocean Rim Association (IORA) oriented policies.
Council of Ministers (COM) Meeting was held ▪ By the time it came back to into the play in the
in Abu Dhabi (UAE). new millennium, it finds huge obstacles for
▪ Theme - “Promoting a Shared Destiny and Path reclaiming the regional leadership of the littoral.
to Prosperity in the Indian Ocean”. ▪ The rise of China has meant that Beijing has
▪ South Africa was the chair for the period of 2017- become a powerful economic force in the Indian
2019. Ocean. It has the resources and the will to develop
▪ The meeting was attended by IORA’s 22 Member regional infrastructure and connectivity.
States and nine Dialogue Partners. ▪ In contrast, India’s economic liberalism is too
weak to let it drive regional integration.
▪ India cannot match the resources, financial or
India and Indian Ocean institutional, that Beijing brings to bear on Indian
Ocean connectivity.
▪ India is a peninsular country which is surrounded
▪ Its political class remains hesitant about building
by Indian Ocean on three sides. The geographical
coalitions with other powers to improve India’s
location of India makes Indian Ocean integral part
regional position.
of its foreign policy, security decision, trade etc.
▪ Delhi’s defence establishment appears utterly
▪ At present, Indian Ocean carries about half of
unprepared to build real military partnerships in
world’s container shipment, one-third of bulk
the littoral.
cargo traffic and two-third of oil shipments.
▪ Its littoral states are densely populated with over
40% of global population which makes it an India’s Role in IORA
attractive market.
▪ It also carries 90% of India’s trade by volume ▪ India continues to promote its official policy of
and 90% of oil imports. “coordination, cooperation and partnership” in
▪ With the changing geopolitical equations of the the regional maritime domain.
world powers such as USA and China, ▪ As coordinator to the priority area on disaster risk
importance of Indian Ocean has increased. management, India has published guidelines for
▪ India is planning to expand and further IORA. It has also urged partners to join the
invigorate IORA’s activities, from renewable Coalition for Disaster Resilient Infrastructure
energy and the blue economy to maritime safety launched at the UN in September 2019.
and security, water science and greater ▪ India has been trying to emerge as the net
institutional and think-tank networking. provider of information in the IOR and in that
▪ Earlier 21-member states of IORA had issued a direction it created the Information Fusion
strategic vision document, known as the Jakarta Centre located in Gurugram to assist member
Concord, that “sets out a vision for a revitalized countries of IOR with real-time crisis information.
and sustainable regional architecture’’. Bangladesh, Mauritius, Maldives, Sri Lanka and
▪ Besides maximizing the potential of trade, Seychelles have been part of the information
investment and economic cooperation in the support structure of India.
region, the Jakarta Concord also aims to address ▪ Indian policy takes into consideration that IOR is
non-traditional issues, such as illegal, unreported not an India-run maritime domain and that is
and unregulated fishing, human trafficking, reflected in the government's Security and
drug trafficking, illegal migration and piracy. Growth for All in the Region (SAGAR)

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 programme, which aims to turn the region more ▪ IORA needs to consider a special regional
inclusive. cooperation programme on Blue Economy.
▪ Recently, India has been granted the observer
status in Indian Ocean Commission (IOC). India
SAGAR Policy can learn from IOC Bottom-up regionalism.
▪ India’s inclusion in the IOC countries will help to ▪ There is a need to make a tangible impact
broaden its Security and Growth for all in the through Project Sagarmala, with a focus on
Regional aka SAGAR Policy in the region. port development, connectivity, port-led
▪ Aim of SAGAR Policy - industrialisation, and coastal community
development, in a timely and effective manner.
1. Increment of abilities for safeguarding land and ▪ The role of the Coast Guard Agencies in all the
maritime territories and interests. Indian Ocean littorals becomes critical Therefore,
2. Reinforcement of economic and security SAGAR vision should now be expanded to include
collaboration in the zone. the coast guard agencies of the IOR littorals
3. Activities for coping with natural disaster, countries.
maritime warnings like terrorism, theft, etc. ▪ SAGAR vision should not only tap the potential of
oceans and marine areas for economic
development of member states but also consider
Recent developments in Indian Ocean: focusing on contribution to achieving
▪ India and Seychelles agreed to work together on a the Sustainable Development Goals.
project to develop a naval base at the Assumption
Island.
▪ India signed a deal with Singapore to expand
existing Indian access to Changi naval base.
▪ India also contributes to the development of
Agalega in Mauritius with dual-use logistical
facilities.
▪ India and France have signed the “reciprocal
logistics support” agreement as part of which
warships of both the nations would have access to
each other’s naval bases.
▪ India and the United States signed the Logistics
Exchange Memorandum of Agreement in 2016,
giving both countries access to designated military
facilities for refueling and supplies.
▪ India also secured access to the Port of Duqm in
Oman for military use and logistical support
earlier this year.
▪ India and France have released a joint strategic
vision for cooperation in the Indian Ocean
Region (IOR). The vision establishes an open,
inclusive and transparent cooperation architecture
for peace, security and prosperity
Way Forward
▪ India must focus on the Indian Ocean Rim
Association (IORA). IORA's mandate is to
promote sustainable growth and balanced
development in the region.

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CH-9 SOUTH ASIAN ASSOCIATION FOR REGIONAL COOPERATION
(SAARC)

Basics and Backgrounds ▪ Russia has applied for observer status membership
of SAARC.
• It was established on 8 December 1985. ▪ Turkey applied for observer status membership of
• Its member countries are—Bangladesh, Bhutan, SAARC in 2012.
India, Maldives, Nepal, Pakistan, Sri Lanka and ▪ South Africa has participated in meetings.
Afghanistan (2005)
• The Headquarters and Secretariat of the Principles
Association are at Kathmandu, Nepal.
• SAARC comprises 3% of the world’s area, 21% of ▪ Respect for the principles of sovereign equality,
the world’s population and 3.8% (2018) of the territorial integrity, political independence,
global economy non-interference in the internal affairs of other
States and mutual benefit.
▪ Such cooperation shall not be a substitute for
Member states
bilateral and multilateral cooperation but shall
complement them.
▪ Such cooperation shall not be inconsistent with
bilateral and multilateral obligations.

Objective

▪ To promote the welfare of the people of South

Asia and to improve their quality of life.
▪ To accelerate economic growth, social progress
and cultural development in the region and to
provide all individuals the opportunity to live in
dignity and to realize their full potentials.
▪ To promote and strengthen collective self-
reliance among the countries of South Asia.
▪ To contribute to mutual trust, understanding and
appreciation of one another’s problems..
▪ To promote active collaboration and mutual
assistance in the economic, social, cultural,
technical and scientific fields.
▪ To strengthen cooperation with other
▪ SAARC comprises of eight member States
developing countries.
namely, Afghanistan, Bangladesh, Bhutan, ▪ To strengthen cooperation among themselves in
India, Nepal, the Maldives, Pakistan and Sri international forums on matters of common
Lanka. Afghanistan joined SAARC in 2007. interests; and
▪ There are currently nine Observers to SAARC, ▪ To cooperate with international and regional
namely: Australia, China, the European Union, organizations with similar aims and purposes.
Iran, Japan, the Republic of Korea, Mauritius,
Myanmar and the United States of America.
Areas of Cooperation
Future Member
▪ Human Resource Development and Tourism
▪ Agriculture and Rural Development
▪ Myanmar has expressed interest in upgrading its ▪ Environment, Natural Disasters and Biotechnology
status from an observer to a full member of the ▪ Economic, Trade and Finance
SAARC. ▪ Social Affairs
▪ China has requested joining SAARC. ▪ Information and Poverty Alleviation

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▪ Energy, Transport, Science and Technology ▪ The 13th SAARC Summit (Dhaka, 12-13
▪ Education, Security and Culture and Others November 2005) decided to establish SAARC
Development Fund (SDF) as a comprehensive
Principal Organs funding mechanism with the provision of three
Windows (Social, Economic and Infrastructure).
▪ SDF Secretariat was formally commissioned in
April 2010 in Thimphu during the Sixteenth
SAARC Summit with the primary objective of
Meeting of Heads
of State or funding project-based collaboration. Since then,
Government SDF has been funding projects approved by the
SDF Board under its Social Window.
▪ SDF is governed by a Board consisting of
representatives from the Ministry of Finance of the
Member States. The Governing Council of SDF
Standing (Finance Ministers of MSs) oversees the
Committee of
Secretariat
Foreign
functioning of the Board.
Secretaries ▪ MS have also been emphasizing on opening up of
the two remaining windows of SDF, i.e. Economic
and Infrastructure Windows.

2. SOUTH ASIAN UNIVERSITY

▪ The Agreement for the Establishment of South
1. Meeting of Heads of State or Government Asian University was signed by the Ministers of
▪ Meetings are held at the Summit level, usually on Foreign/External Affairs of the MSs of SAARC
an annual basis. during the Fourteenth SAARC Summit (New
Delhi, 4 April 2007).
2. Standing Committee of Foreign Secretaries ▪ As per Article 7 of the Agreement of the SAU, it is
▪ The Committee provides overall monitoring and necessary for the MS to recognize the Degrees and
coordination, determines priorities, mobilizes Certificates awarded by the SAU at par with the
resources, and approves projects and financing. respective Degrees and Certificates awarded by the
National Universities / Institutions.
3. Secretariat
▪ The SAARC Secretariat was established in 3. SOUTH ASIAN REGIONAL STANDARDS
Kathmandu on 16 January 1987. Its role is to ORGANIZATION
coordinate and monitor the implementation of ▪ The fifteenth SAARC Summit paved the way for
SAARC activities, service the meetings of the establishing SARSO in order to harmonize
association and serve as a channel of standards and promote cooperation in the fields of
communication between SAARC and other metrology, accreditation and conformity
international organizations. assessment for enhancing the capacity of the
▪ The Secretariat comprises the secretary-general, respective national institutions in carrying out their
seven directors, and the general services staff. The technical tasks.
secretary-general is appointed by the Council of ▪ The agreement on SARSO came into effect on
Ministers on the principle of rotation, for a non- 25th August 2011.
renewable tenure of three years.
4. SAARC ARBITRATION COUNCIL
SAARC Specialized Bodies ▪ The agreement on SARCO was signed during the
Thirteenth Summit and came into effect on 2 July
SAARC has established new institutions such as 2007.
SAARC Arbitration Council (SARCO), South ▪ SARCO was established with a view to resolve
Asian University (SAU), SAARC Development cost-effective settlement of disputes via arbitration
Fund (SDF) Secretariat and SAARC Regional within the region.
Standards Organization (SARSO) which have
mandates and structures different from the Regional SAARC Disaster Management Centre
Centers.
1. SAARC DEVELOPMENT FUND

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▪ South Asian Association of Regional Cooperation
(SAARC) Disaster Management Centre (SDMC- Principles of SAFTA
IU) has been set up at Gujarat Institute of Disaster
Management (GIDM) Campus, Gandhinagar, ▪ SAFTA will be governed by the provisions of
Gujarat, India. this Agreement and also by the rules, regulations,
▪ Eight Member States, i.e., Afghanistan, decisions, understandings and protocols to be
Bangladesh, Bhutan, India, Maldives, Nepal, agreed upon within its framework by the
Pakistan and Sri Lanka are expected to be served Contracting States.
by the SDMC (IU). ▪ The Contracting States affirm their existing
▪ It is entrusted with the responsibility of serving rights and obligations with respect to each other
Member States by providing policy advice, under Marrakesh Agreement establishing the
technical support on system development, capacity World Trade Organization and other
building services and training for holistic Treaties/Agreements to which such Contracting
management of disaster risk in the SAARC region. States are signatories.
▪ The centre also facilitates exchange of information ▪ SAFTA shall be based and applied on the
and expertise for effective and efficient principles of overall reciprocity and mutuality of
management of disaster risk. advantages in such a way as to benefit equitably
all Contracting States, taking into account their
South Asian Free Trade Agreement (SAFTA) respective levels of economic and industrial
development, the pattern of their external trade and
▪ Motivated by the commitment to strengthen intra- tariff policies and systems.
SAARC economic cooperation to maximise the ▪ SAFTA shall involve the free movement of goods,
realisation of the region's potential for trade and between countries through, inter alia, the
development for the benefit of their people, in a elimination of tariffs, para tariffs and non-tariff
spirit of mutual accommodation, with full respect restrictions on the movement of goods, and any
for the principles of sovereign equality, other equivalent measures.
independence and territorial integrity of all States. ▪ SAFTA shall entail adoption of trade facilitation
▪ The Contracting States hereby establish the South and other measures, and the progressive
Asian Free Trade Area (SAFTA) in 2004 during harmonization of legislations by the Contracting
the 12th SAARC Summit held in Islamabad States in the relevant areas.
(Pakistan) to promote and enhance mutual trade ▪ The special needs of the Least Developed
and economic cooperation among the Contracting States shall be clearly recognized by
Contracting States, through exchanging adopting concrete preferential measures in their
concessions in accordance with this Agreement. favour on a non-reciprocal basis.

Objective of SAFTA SAARC Development Fund

The Objectives of this Agreement are to promote and ▪ It was established by heads of all eight SAARC
enhance mutual trade and economic cooperation member states during 16th SAARC summit at
among Contracting States by, inter-alia: Thimphu, Bhutan in 2010.
▪ eliminating barriers to trade in, and facilitating the ▪ Its Secretariat is located at Thimphu, capital of
cross-border movement of goods between the Bhutan. Its Governing Council comprises finance
territories of the Contracting States. ministers of these eight countries.
▪ Promoting conditions of fair competition in the ▪ It was created as umbrella financial mechanism
free trade area, and ensuring equitable benefits to for all SAARC developmental projects and
all Contracting States, taking into account their programmes.
respective levels and pattern of economic ▪ It funds projects in South Asia region via three
development. windows viz. Social Window, Economic
▪ Creating effective mechanism for the Window and Infrastructure Window.
implementation and application of this ▪ The SDF has a total corpus of $1.5 billion with the
Agreement, for its joint administration and for the total capital base currently at $497 million.
resolution of disputes.
▪ Establishing a framework for further regional SAARC and its Importance
cooperation to expand and enhance the mutual
benefits of this Agreement.

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▪ SAARC comprises 3% of the world's area, 21% BBIN MVA
of the world's population and 3.8% (US$2.9
trillion) of the global economy. ▪ Bangladesh, Bhutan, India and Nepal (BBIN)
▪ Creating synergies: It is the world’s most densely had signed a framework MVA in June 2015 to
populated region and one of the most fertile areas. enable movement of passenger and cargo vehicles
SAARC countries have common tradition, dress, across borders among the four countries.
food and culture and political aspects thereby ▪ Bhutan has not yet ratified the pact for its entry to
synergizing their actions. come into force. However, Bhutan had given its
▪ Common solutions: All the SAARC countries consent for the BBIN MVA to enter into force
have common problems and issues like poverty, amongst the other 3 countries i.e. Bangladesh,
illiteracy, malnutrition, natural disasters, internal India and Nepal, who have already ratified it.
conflicts, industrial and technological
backwardness, low GDP and poor socio-economic
condition and uplift their living standards thereby
creating common areas of development and
progress having common solutions.

SAARC Achievements

▪ Free Trade Area (FTA): SAARC is

comparatively a new organization in the global
arena. The member countries have established
a Free Trade Area (FTA) which will increase
their internal trade and lessen the trade gap of
some states considerably.
▪ SAPTA: South Asia Preferential Trading
Agreement for promoting trade amongst the
member countries came into effect in 1995.
▪ SAFTA: A Free Trade Agreement confined to
goods, but excluding all services like information About the Project
technology. Agreement was signed to reduce
customs duties of all traded goods to zero by the ▪ The BBIN project was conceived when SAARC at
year 2016. its 18th Summit in Kathmandu failed to sign a
▪ SAARC Agreement on Trade in Services SAARC Motor Vehicles Agreement -chiefly
(SATIS): SATIS is following the GATS-plus because of Pakistan.
'positive list' approach for trade in services ▪ The sub-regional Motor Vehicle Agreement
liberalization. (MVA) seeks regulation of passenger, personnel
▪ SAARC University: Establish a SAARC and cargo vehicular traffic between the four
university in India, a food bank and also an energy BBIN countries.
reserve in Pakistan. ▪ Originally, the project mentioned 30 identified
priority transport connectivity projects with an
Recent Developments estimated cost of over US $8 billion that will
rehabilitate and upgrade remaining sections of
▪ South Asia Satellite trade and transport corridors in the BBIN
o Pakistan has decided to opt-out of the countries.
satellite project. So it cannot be called a ▪ India, Nepal and Bangladesh have ratified the
SAARC satellite. It will be a South Asia Agreement while Bhutan failed to get its
satellite. Parliament’s nod to ratify the same. It has some
▪ Framework agreement in power sector - reservations about its environmental impact owing
Electricity trading through grid connectivity. to increased traffic of heavy-duty vehicles.
▪ India Business Card for SAARC trade - “India ▪ Under South Asia Sub-regional Economic
Business Card” to be given to businessmen of Cooperation (SASEC) programme, Asian
high repute in SAARC countries. Development Bank (ADB) has been providing
technical, advisory, and financial support to this
initiative.

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▪ On November 1, 2015, a cargo vehicle made the ▪ Inadequate public health service
first successful trial run from Kolkata to infrastructure to cope with rising cases, as all
Agartala via Bangladesh that reduced the distance SAARC members are developing nations with
by over a thousand kilometers. sub-standard public health infrastructure.
▪ In recent meet, the delegations discussed a draft
enabling MOU (memorandum of Video Conference of SAARC Leaders on
understanding) among Bangladesh, India and COVID-19
Nepal for implementing the BBIN MVA, without
obligation to Bhutan. Bhutan participated in ▪ The South Asian Association for Regional
observer capacity. Cooperation (SAARC) should create a fund to
fight the threat of COVID-19, Prime Minister
Significance of SAARC for India Narendra Modi announced on 15th March 2020 –
Addressing the first ever video conference among
▪ Neighborhood first: Primacy to the country’s the heads of governments of the SAARC member
immediate neighbours. countries.
▪ Geostrategic significance: Can counter China ▪ Foreign Secretary of India Harsh Vardhan Shringla
(OBOR initiative) through engaging our and his counterparts from other member countries
neighbours in development process and economic of SAARC should meet and decide the plan ahead
cooperation. for the creation of the SAARC COVID-19
▪ Regional stability: These regional organisations Emergency Fund.
can help in creation of mutual trust (India & ▪ Proposal from the South Asian leaders came days
Pakistan) and ensure that regional interest over after the World Health Organisation (WHO)
ride bilateral disputes floated the COVID-19 Solidarity Response Fund
▪ Global leadership role: It offers India a platform with the help of corporate bodies, foundations and
to showcase its leadership in the region by taking the UN Foundation.
up extra responsibilities. ▪ The conference is considered as a step towards
▪ Game changer for India’s Act East the revival of SAARC as the SAARC Summit
Policy: Linking of South Asian economies with has not taken place since 2014 because of India-
South East Asian region will bring further Pakistan tensions.
economic integration and prosperity to India
particularly in its under-developed Eastern region India’s Proposal in the Conference
▪ Potential for India’s export: With closer
economic integration of economies in the region, 1. COVID-19 Emergency Fund
India’s domestic companies will get access to ▪ India has proposed to create a COVID-19
much bigger market thus boosting their revenues Emergency Fund which could be based on
a voluntary contribution from all SAARC
Impact of COVID-19 on SAARC members.
▪ Further, $10 million has been extended
▪ Major concern is of an escalation in the virus’s by India as a contribution to the fund.
spread in the subcontinent. ▪ The fund can be used to meet the cost of
▪ With close to 300 positive cases, South Asia has immediate actions by any member and will be
seen a much lower incidence globally, but given coordinated through foreign secretaries and
its much higher population density, it is clear embassies of the member countries.
that any outbreak will lead to far more casualties. ▪ The World Health Organisation (WHO) has also
▪ Afghanistan and Pakistan have specific constituted the COVID-19 Solidarity Response
challenges as they share long borders with Iran, Fund with the help of corporate bodies,
which has emerged, after China and Italy, as a foundations and the UN Foundation.
major hub of the virus.
▪ Bhutan, the Maldives, Nepal and Sri Lanka worry 2. Other Proposals by India
about the impact on tourism, which is a mainstay ▪ India has also proposed a rapid response team of
of their economies. doctors and specialists, along with testing kits
▪ Other concerns are about under-reporting, as and other equipment for all the member countries.
fewer people are being tested in much of South ▪ India has set up an Integrated Disease
Asia Surveillance Portal to better trace possible virus
carriers and the people they contacted. India has
offered to share it with member countries.

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 its promises thus pushing Nations to seek help
Other Issues Discussed from China or West.
▪ Rising China in the region with its overarching
1. Economic Issues and Measure Belt & Road initiative (Cheque book Diplomacy
▪ The conference also discussed longer-term of China).
economic consequences of COVID-19. ▪ South Asia Free Trade Agreement (SAFTA)
▪ The member countries have also proposed to that came into force in 2006 is often highlighted
insulate internal trade of South Asia and local as a prominent outcome of SAARC, but given the
value chains from its impact. presence of sensitive lists, it is yet to be
implemented in spirit. Almost 35 percent of the
2. Measures by SAARC to Manage Health value of intraregional trade in South Asia is subject
Pandemics to sensitive list tariffs. There is no provision in
▪ It has been decided to frame and enforce SAFTA to phase out this list.
the common SAARC pandemic protocols. ▪ SAARC does not have any arrangement for
▪ The members have also decided to establish resolving disputes or mediating conflicts.
a working group of national authorities for ▪ Pakistan’s non-cooperation has stalled some major
health information, data exchange and initiatives under SAARC. For example: SAARC–
coordination in real-time. Motor Vehicles Agreement (MVA) and SAARC
▪ It has also proposed a SAARC health ministers’ satellite project.
conference and the development of regional Why SAARC has been dormant in the recent
mechanisms to share disease surveillance data in past?
real-time.
▪ Lack of trust among the member countries: In
3. Country-Specific Issues the many failures of SAARC, lack of trust among
▪ Afghanistan has highlighted the vulnerability as the member countries has been the most
it shares a long and open border with Iran, one significant factor between India and Pakistan. In
of the worst affected countries in the world. recent times, Pakistan’s non-cooperation has
▪ The Maldives has cited the economic stalled some major initiatives under SAARC. For
downturn owing to the drop in tourists inflow example, despite India’s keen interest in
from Italy, China and Europe - the main source cooperating and strengthening intra-regional
of tourists for the country and sought a South connectivity by backing the SAARC–MVA during
Asian response to the crisis. the 18th summit of SAARC, the agreement was
▪ The tourism-dependent countries like Bhutan, stalled following Pakistan’s reluctance.
Sri Lanka has also sighted issues related to ▪ Security cooperation: SAARC has also faced
the economic slowdown. obstacles in the area of security cooperation. A
major hindrance in this regard has been the lack of
Challenges of SAARC consensus on threat perceptions, since member
countries disagree on the idea of threats. For
▪ Broad area of cooperation leads to diversion of instance, while cross-border terrorism emanating
energy and resources. from Pakistan is a major concern for India,
▪ Low Intra-regional trade: South Asia is the Pakistan has failed to address these concerns.
world’s least integrated region; less than 5% of the ▪ Big Brother attitude of India: The asymmetry
trade of SAARC countries is within. between India and other member countries in
▪ Inadequate Political Will: India’s inclination terms of geography, economy, military strength
towards Big powers which leads to neglecting its and influence in the global arena make the smaller
relationship with its neighbours countries apprehensive. They perceive India as
▪ Bilateral tensions, especially between India and “Big Brother” and fear that it might use the
Pakistan, spilling over into SAARC meetings. SAARC to pursue hegemony in the region. The
▪ Perception of India being a Big Brother vis-à- smaller neighbouring countries, therefore, have
vis its neighbours whereby India enforces its own been reluctant to implement various agreements
agenda on small neighbouring countries through under SAARC.
these groupings ▪ Resources: SAARC faces a shortage of resources,
▪ Slow implementation of the projects announced and countries have been reluctant to increase their
by India – declines India’s credibility to deliver on contributions.
▪ Lack of Connectivity: The lack of connectivity
among member states is another weakness of the

219
 SAARC. This ties in with the lack of a proper by SAARC members, are concentrating on
infrastructure of member states. This infrastructure promotion of economic and social interactions and
deficit in turn leads to reduced connectivity among relations. There is hardly any significant
the SAARC nations. South Asia needs to invest up development, under the banner of SAARC, to
to $2.5 trillion to bridge its infrastructure gap over promote mutual trust and resolve mutual disputes.
the next ten years, says a 2014 World Bank report. Dispute resolving has been, unfortunately, left out
Women, the poor, and marginalized social groups of the scope of SAARC. Even “SAARC Regional
are particularly affected by the region’s Convention on Suppression of Terrorism” was
infrastructure gap. nothing but ratification and implementation of the
▪ Agreements and Conventions: Almost all the UN resolutions and conventions
agreements and conventions, adopted and signed

Way Forward

▪ In a region increasingly targeted by Chinese investment and loans, SAARC could be a common platform to
demand more sustainable alternatives for development, or to oppose trade tariffs together, or to demand
better terms for South Asian labour around the world.
▪ SAARC, as an organisation, reflects the South Asian identity of the countries, historically and contemporarily.
This is a naturally made geographical identity. Equally, there is a cultural, linguistic, religious and culinary
affinity that defines South Asia.
▪ The potential of organisation to maintain peace and stability in the region should be explored by all the
member countries.
▪ SAARC should be allowed to progress naturally and the people of South Asia, who make up a quarter of the
world’s population should be offered more people-to-people contact.
▪ All of India’s neighbours implicitly recognize that India is South Asia’s natural leader. However, India cannot
take leadership for granted; it has to earn it.
▪ South Asia may be politically divided but it faces common security challenges. Nation-building is still a work
in progress in southern Asia, and state sovereignties are still new and fiercely defended.
▪ Regional connectivity in South Asia should be a strategic priority for India.

220
 CH-10 SHANGHAI COOPERATION ORGANIZATION
(SCO)
Basics and Backgrounds Republic of Nepal, the Republic of Turkey, and
the Democratic Socialist Republic of Sri Lanka.
▪ Shanghai Cooperation Organization is a
permanent intergovernmental international Goals and Objective
organisation.
▪ Its creation was announced on 15 June 2001 in ▪ Promoting mutual trust and neighbourliness.
Shanghai (China) by the Republic of ▪ Promoting cooperation in politics, trade,
Kazakhstan, the People’s Republic of China, economy, research, technology and culture.
the Kyrgyz Republic, the Russian Federation, ▪ Enhancing ties in areas like education, energy,
the Republic of Tajikistan, and the Republic of transport, tourism, environmental protection
Uzbekistan. and healthcare.
▪ It was preceded by the Shanghai Five ▪ Maintaining and ensuring peace, security and
mechanism. stability in the region.
▪ The Shanghai Cooperation Organisation Charter ▪ Moving towards establishment of democratic, fair
was signed during the St. Petersburg SCO and rational international political and
Heads of State meeting in June 2002, and economic order.
entered into force on 19 September 2003.
▪ The SCO’s official languages are Russian SECURE Strategy
and Chinese.
S- Security of citizens
Member Countries E- Economic development for all
C- Connecting the region
U- Uniting our people
R- Respect for sovereignty and territorial integrity
E- Environmental protection

Structure

Heads of State Council

Heads of the Government Council

Council of Ministers of Foreign Affairs

▪ SCO comprises eight member states, namely the Regional Anti-Terrorists Structure
Republic of India, the Republic of Kazakhstan,
the People’s Republic of China, the Kyrgyz SCO Secretariat
Republic, the Islamic Republic of Pakistan, the
Russian Federation, the Republic of Tajikistan,
and the Republic of Uzbekistan. ▪ Heads of State Council – The supreme SCO body
▪ The Islamic Republic of Afghanistan, the which decides its internal functioning and its
Republic of Belarus, the Islamic Republic of interaction with other States & international
Iran and the Republic of Mongolia are the organisations, and considers international issues.
observer states in SCO. ▪ Heads of Government Council – Approves the
▪ SCO has six dialogue partners, viz, the Republic budget, considers and decides upon issues related
of Azerbaijan, the Republic of Armenia, the economic spheres of interaction within SCO.
Kingdom of Cambodia, the Federal Democratic ▪ Council of Ministers of Foreign Affairs –
Considers issues related to day-to-day activities.

221
▪ Regional Anti-Terrorist Structure (RATS) – How does the West view SCO ?
Established to combat terrorism, separatism and
extremism. ▪ The SCO describes one of its main goals as
▪ SCO Secretariat – Based in Beijing to provide moving towards the establishment of a
informational, analytical & organisational support. democratic, fair and rational new international
political and economic order.
Shanghai Spirit: The Fundamental Principles ▪ In 2005, the Astana declaration called for SCO
countries to work on a “joint SCO response to
▪ Internal policy based on the principles of mutual situations that threaten peace, security and
trust, mutual benefit, equality, mutual stability in the region”, indicating the group’s
consultations, respect for cultural diversity, and strategic ambitions
a desire for common development. ▪ As a result, the SCO was eyed with some
▪ External policy in accordance with the principles misgivings by the U.S. and Europe. It was even
of non-alignment, non-targeting any third dubbed the “Anti-NATO” for proposing military
country, and openness. cooperation.
▪ Western and NATO concerns were heightened
Strength when they placed heavy sanctions against Russia
for its actions in Crimea, but China came to
▪ The SCO covers 40%of the global population, Russia’s aid, signing a 30-year, $400 billion gas
nearly 20% of the global GDP and 22% of the pipeline framework agreement.
world’s land mass.
▪ The SCO has a strategically important role in Bishkek Summit of 2019
Asia due to its geographical significance - this
enables it to control the Central Asia and limit the ▪ Marked the second year in which India
American influence in region. participated as a full member.
▪ SCO is seen as counterweight to the North ▪ Honourable Prime Minister Narendra Modi in his
Atlantic Treaty Organisation. address to the SCO leaders presented his vision for
the organization in the form of Health (healthcare
SCO RATS: cooperation, economic cooperation, alternate
Regional Anti-Terrorist Structure (RATS) of SCO is a energy, literature and culture, terrorism-free
permanent body based in Tashkent, Uzbekistan. The society and humanitarian cooperation).
objective of RATS is based upon the Shanghai ▪ He called upon member states to ensure that
Convention on Combating Terrorism, Separatism and nations which support, promote or finance
Extremism. RATS possess information on terrorist terror must be held accountable – referring to
organisations and terrorists. Pakistan without explicitly naming it.
The military exercise ‘Peace Mission 2018’ was ▪ India refused to join the clause in the declaration
conducted in Russia and became the1st platform after in support of the Belt and Road Initiative, while
UN Peace Mission Peace Keeping Missions for joint all the other SCO members ‘reaffirmed their
military engagement between India and Pakistan. support’ for the Chinese initiative.
▪ The declaration called for ‘consistent
Operations implementation’ of the Joint Comprehensive
Plan of Action (Iran nuclear deal) and asked all
▪ Initially, the SCO focused on mutual participants ‘for comprehensive and effective
intraregional efforts to curb terrorism, implementation of the document,’ a year after US
separatism and extremism in Central Asia. pulled out of it.
▪ In 2006, SCO’s agenda widened to include ▪ The ‘Roadmap for Further Action of the SCO
combatting international drug trafficking as a Afghanistan Contact Group’ was signed by the
source of financing global. leaders.
▪ In 2008, SCO actively participated in bringing ▪ The Indian position of an ‘Afghan-led, Afghan-
back stability in Afghanistan. owned and Afghan-controlled inclusive peace
▪ In 2003, SCO member states signed a 20-year process’ was similarly highlighted by the prime
Programme of Multilateral Trade and minister.
Economic Cooperation for the establishment of a ▪ Russian leader invited Modi to be the chief guest
free trade zone within the territory under the SCO at the Eastern Economic Forum in Vladivostok
member states.

222
 in September, which would also see the annual ▪ Talks on the construction of stalled pipelines like
bilateral summit being held alongside the same. the TAPI (Turkmenistan-Afghanistan-Pakistan-
▪ The India-China bilateral, coming after India) pipeline; IPI (Iran-Pakistan-India)
successful listing of Masood Azhar as a global pipeline can get a much needed push through the
terrorist, led to the decision to expedite border SCO.
talks and plans to mark the 70th anniversary of ▪ SCO provides direct access to Central Asia –
establishment of diplomatic relations. overcoming the main hindrance in flourishing of
▪ Addressing the first India-Kyrgyzstan Business trade between India and Central Asia.
Forum, the Prime minister emphasised on better ▪ SCO acts as an alternative route to Central Asia.
connectivity as being crucial for better trade ties. ▪ Central Asian countries provide India with a
The two countries signed the Double Taxation market for its IT, telecommunications, banking,
Avoidance Agreement as talks continue on the finance and pharmaceutical industries.
preferential trade agreement with the Eurasian
Economic Union (EAEU).

Importance for India Challenges for SCO membership for India

▪ The full membership of the SCO will provide ▪ India joining the SCO has been seen as puzzling
India greater visibility in the affairs of the foreign policy move, as it has come at a time
Eurasian region which is strategically when New Delhi is looking more keenly at the
important for India. West, and in particular at the maritime
▪ Central Asia is a part of India's Extended ‘Quadrilateral’ with the U.S., Japan and
Neighbourhood – SCO provides India an Australia.
opportunity to pursue the “Connect Central ▪ Since 2014, India and Pakistan have cut all ties,
Asian Policy”. talks and trade with each other, and India has
▪ Helps India fulfil its aspiration of playing an refused to attend the SAARC summit due to
active role in its extended neighbourhood as tensions with Pakistan, but both their
well as checking the ever growing influence of leaderships have consistently attended all
China in Eurasia. meetings of the SCO.
▪ It will enable India, as an integral part of the ▪ Despite the fact that India accuses Pakistan of
Eurasian security grouping, to neutralise perpetrating cross-border terrorism at every
centrifugal forces arising from religious other multilateral forum, at the SCO, Indian and
extremism and terrorism in the region. Pakistani armed forces even take part in military
▪ It will help India in managing much more and anti-terrorism exercises together.
effectively the negative impact of a Talibanised ▪ India has again refused to endorse the BRI
Afghanistan, especially in the post-2014 project. Without its participation the success of
scenario. project cannot be ensured. All other countries have
▪ India through RATS can improve its endorsed BRI, thus its interesting to see how long
counterterrorism abilities by working toward India can sustain its stand on BRI.
intelligence sharing, law enforcement and ▪ India is seating in that where India’s relations
developing best practices and technologies. with countries like Pakistan, China and Russia
▪ Through the SCO, India can also work on anti- have been heightened in recent time. It will be
drug trafficking and small arms proliferation. challenging for India to balance new nexus
▪ Cooperation on common challenges of terrorism between China-Pakistan-Russia and its approach
and radicalisation. towards West.
▪ It will provide India with a forum where it can
constructively engage both China and Pakistan in SCO deal with bilateral tensions
a regional context and project India’s security
interests in the turbulent regional swathe— ▪ The SCO Charter doesn’t allow any bilateral
including West Asia. dispute to be taken up, but it provides a
▪ India being an energy deficient country with comfortable platform for finding common ground
increasing demands for energy, SCO provides it and eventually, creating conditions for dialogue
with an opportunity to meet its energy between countries.
requirements through regional diplomacy. ▪ In 2009, India and Pakistan held the first talks after
the Mumbai attacks on the side-lines of the SCO

223
 summit in Astana, where then Prime Minister Ufa, for a meeting that even resulted in a joint
Manmohan Singh and former Pakistani President statement.
Asif Ali Zardari met and tried to resolve tension ▪ In 2020, SCO host, Russia, encouraged and
through talks. facilitated meetings between between India and
▪ In 2015, Prime Minister Narendra Modi met then China to discuss the stand-off at the LAC.
Pakistani PM Nawaz Sharif at the SCO summit in
Way Forward

▪ SCO provides a very good opportunity to India to connect with the leadership of Central Asian countries and
that a very big take away.
▪ India has a good record of economic growth and handling problem which is a problem of other countries which
lays foundation to huge foreign investment.
▪ The SCO which had stated with a group of five members has expanded and included India and Pakistan in 2017.
Its goals and objectives have also widened from security to economy and other areas.
▪ For India, it is a very good opportunity to boost its ties with Central Asian countries.

224
 CH-11 NON ALIGNMENT MOVEMENT (NAM)

Basics and Backgrounds ▪ Non-interference in the internal affairs of States.

No State or group of States has the right to
intervene either directly or indirectly, whatever the
▪ Founded in 1961 in Belgrade. motive, in the internal affairs of any other State.
▪ It was created by the heads of Yugoslavia, India, ▪ Promotion and defence of multilateralism and
Egypt, Ghana and Indonesia. multilateral organisations as the appropriate
▪ All five leaders believed that developing countries frameworks to resolve, through dialogue and
should not help either the Western or Eastern cooperation, the problems affecting humankind.
blocs in the Cold War.
▪ The Non-Aligned Movement was formed during Objective
the Cold War as an organization of States that did
not seek to formally align themselves with either ▪ NAM has sought to "create an independent path in
the United States or the Soviet Union, but sought world politics that would not result in member
to remain independent or neutral. States becoming pawns in the struggles between
▪ It was created by Yugoslavia’s President, Josip the major powers."
Broz Tito, India’s first PM, Jawaharlal Nehru, ▪ It identifies the right of independent judgment, the
Egypt’s second President Gamal Abdel Nasser, struggle against imperialism and neo-colonialism,
Ghana’s first president Kwame Nkrumah, and and the use of moderation in relations with all big
Indonesia’s first President, Sukarno. powers as the three basic elements that have
▪ The movement represented the interests and influenced its approach.
priorities of developing countries. The ▪ At present, an additional goal is facilitating a
Movement has its origin in the Asia-Africa restructuring of the international economic order.
Conference held in Bandung, Indonesia in 1955.
▪ As a condition for membership, the states of the NAM in Cold War Era
NAM cannot be part of a multilateral military
alliance (such as the NATO) or have signed a
Positive Role Negative Role
bilateral military agreement with one of the “big
▪ NAM played an ▪ Could not
powers” involved in Great Power conflicts.
important role during prevent India-
the Cold War years in Pakistan and Indo-
Principles
furthering many of China wars.
the causes that India ▪ During the wars,
The principles of NAM was largely guided by advocated like: NAM members
Panchsheel principles, some of them are: ▪ Decolonisation invariably adopted
▪ End to apartheid diplomatic
▪ Respect for the principles enshrined in the charter ▪ Global nuclear positions that were
of the United Nations and international law. disarmament not favourable
▪ Respect for sovereignty, sovereign equality and ▪ Ushering in of new towards or supportive
territorial integrity of all States. international of India.
▪ Peaceful settlement of all international conflicts economic and ▪ Taking a broader
in accordance with the charter of the United information orders perspective:
Nations. ▪ Non-alignment stood
▪ Respect for the political, economic, social and for policy
cultural diversity of countries and peoples. autonomy for the
▪ Defence and promotion of shared interests, erstwhile newly
justice and cooperation, regardless of the independent
differences existing in the political, economic and countries. 2)These
social systems of the States, on the basis of mutual countries banded
respect and the equality of rights. together because of
▪ Respect for the inherent right of individual or their shared
collective self-defence, in accordance with the traditions and
charter of the United Nations

225
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 histories, which counterforce to China’s rise in the Indo-Pacific
included anti- and Shanghai cooperation organisation led by
colonialism, anti- China shown India’s balancing approach in new
imperialism and world order.
anti-racism. ▪ India is striving hard for a multipolar world order
▪ The idea behind non- and asserting itself as one of the player. Multi
alignment thus polar world order is very much closed to NAM
conceived was principles.
to promote peace
and security in a Present Situation
global arena where
superpowers were ▪ The end of cold war lead to unipolar world and
constantly posturing now tending towards multi-polarity. The NAM is
to achieve their now reached irrelevance.
hegemonic ambitions. ▪ NAM could not push for reforms in the global
bodies like UN, IMF and WTO.
▪ Inability to find solution to the West-Asian crisis.
Withdrawal of one of the founder members-
How has NAM benefitted India? Egypt, after the Arab Spring.
▪ Most of the members are economically weak;
▪ India being a founder and largest member in NAM hence they have no say in world politics or
was an active participant in NAM meetings till economy.
1970s but India’s inclination towards erstwhile ▪ World has again moved towards bi-polarity, one
USSR created confusions in smaller members. It led by US and other by China-Russia. The war
led to the weakening of NAM and small nations torn syria is prime example of this, where both
drifted towards either US or USSR. US and Russia is asserting power.
▪ Further disintegration of USSR led the unipolar ▪ The escalating tension in Indo-pacific region
world order dominated by US. India’s New due to China’s assertion and US acting as a
Economic Policy and inclination towards US counterweight to check the Chinese expansionist
raised questions over India’s seriousness over non policy.
alignment. ▪ The large scale migration in Europe and
▪ Prime Minister of India skipped the 17th Non Asia due to the unstable regimes and ethnic
Aligned Movement (NAM) summit held in conflict in different parts of world.
Venezuela in 2016, it was only second such ▪ Issue of global climate change and occurrence
instance when Head of a state didn’t participate in of catastrophic disasters raising demand to
NAM conference. form global consensus to deal with it.
▪ Moreover, NAM continued losing relevance for ▪ Changing US policies, protectionism, prevalent
India in a unipolar world, especially after the terrorism and nuclearisation of middle east.
founding members failed to support India during ▪ Formation of multiple regional economic
crisis. For instance, during 1962 War with China, groupings like TPP and RCEP and fading away
Ghana and Indonesia, adopted explicitly pro-China of multilateral bodies WTO from global arena.
positions. During 1965 and 1971 wars, Indonesia
and Egypt took an anti India stance and supported Relevance of NAM
Pakistan.
▪ India in particular, but also most other NAM ▪ Can be used as a platform to bring about
countries, have integrated themselves to varying disarmament.
degrees within the liberal economic order and have ▪ Voice of the South Bloc (Third World Countries)
benefited from it. ▪ Stability in the rising multipolar world order
▪ India is a member of the G20 and has declared ▪ Can help to contain the rise of China by raising a
itself as a nuclear weapons power and has for all collective voice.
practical purposes abandoned the call for global ▪ A platform where India’s Leadership is
nuclear disarmament. recognized
▪ India has also engaged itself with new and old ▪ A unique platform of countries with dissimilar
global powers. India joining the Quadrilateral backgrounds and interests
Security Dialogue, a coalition seen by many as a ▪ Can be used to gather support for India’s quest
to become a permanent member of the UNSC.

226
 ▪ Other Issues:
Non Alignment Movement Virtual Summit o India also flagged the issues of “terrorism”
and “fake news”, calling them “deadly
viruses” at a time when the world fights the
▪ The virtual Non-Aligned Movement novel coronavirus.
(NAM) Contact Group Summit held through o The above issues divide communities and
video conferencing recently. countries creating difficult situations.
▪ Theme: “United against Covid-19”.
▪ The meeting was convened at the initiative of
President Ilham Aliyev of Azerbaijan, in his Way Forward
capacity as chair of the Non Aligned Movement.
▪ Moreover 30 Heads of State and other leaders ▪ NAM as a concept can never be irrelevant,
had joined the Summit. principally it provides a strong base to foreign
▪ The Summit was also addressed by the UN policy of its members.
General Assembly president and World Health ▪ It should be seen as “Strategic Autonomy”,
Organisation (WHO) chief. which is the need of the hour of today’s world.
▪ It was the first time that Prime Minister The principles of NAM still can guide the nations
Narendra Modi participated in a NAM Summit towards it.
since he assumed the office in 2014. ▪ NAM is a platform where India can assert its soft
▪ Prime Minister Narendra Modi became the first power and provide an active leadership and by
Indian Prime Minister to skip the NAM being a torchbearer for smaller countries at
Summit in 2016 and in 2019. multilateral platforms.
▪ Platform like Non Aligned Movement should be
India’s Stand used for consensus making on spectrum of global
issues like terrorism, climate change and trade
protectionism and others.
▪ India’s Role in Fight Against Covid-19:
▪ NAM platform can be used to garner support by
o India is regarded as the pharmacy of the world
South-East Asian countries like Vietnam,
especially for affordable medicines.
Malaysia, Indonesia and Philippines against
o Despite its own needs during Covid-19
Chinese assertion in South China Sea and
pandemic, it has ensured supply of medicines
related island and border disputes.
to 123 partner countries including 59 NAM
▪ NAM can provide a platform for Afro-Asian
members.
cooperation and a strong position for poor African
o India is also active in global efforts to develop
nation to have healthy negotiations with China and
remedies and vaccines for Covid-19.
US for economic development without
▪ Need for the New Template of Globalisation:
compromising the sovereignty of their land.
o India stated that Covid-19 has shown
limitations of the existing international system.
The world needs more representative
international institutions and thus world order
should be more representative.
o Thus, in the post-Covid world, a new template
of globalisation, based on fairness, equality,
and humanity is needed.
▪ International Cooperation:
o NAM should call upon the international
community and the WHO to focus on building
health-capacity in developing countries.
o World needs to ensure equitable, affordable
and timely access to health products and
technologies for all.

227
 CH-12 ARCTIC COUNCIL
inter-governmental, inter-parliamentary, global,
Basics and Backgrounds regional and non-governmental organizations that
the Council determines can contribute to its work.
Arctic Council Observers primarily contribute
through their engagement in the Council at the
level of Working Groups.
▪ Permanent Participants: In 1998, the number of
Permanent Participants doubled to make up the
present six, as,the Aleut International
Association (AIA), and then, in 2000, the Arctic
Athabaskan Council (AAC) and the Gwich'in
Council International (GGI) were
appointed Permanent Participants.

Organization structure

▪ Arctic Council assessments and recommendations

are the result of analysis and efforts undertaken by
the Working Groups. Decisions of the Arctic
Council are taken by consensus among the eight
Arctic Council States, with full consultation and
involvement of the Permanent Participants.
▪ The Chairmanship of the Arctic Council rotates
▪ The Arctic Council is a high- every two years among the Arctic
level intergovernmental forum that addresses States. The first country to chair the Arctic
issues faced by the Arctic governments and Council was Canada (1996-1998).
the indigenous people of the Arctic. ▪ The next country to assume the Chairmanship will
▪ The first step towards the formation of the be Iceland (2019-2021).
Council occurred in 1991 when the eight Arctic
Arctic Council working groups
countries signed the Arctic Environmental
Protection Strategy (AEPS).
▪ Arctic Contaminants Action Program (ACAP) :
▪ The 1996 Ottawa Declaration established the
strengthening and supporting mechanism to
Arctic Council as a forum for promoting encourage national actions to reduce emissions and
cooperation, coordination, and interaction among other releases of pollutants.
the Arctic states, with the involvement of the ▪ Arctic Monitoring and Assessment Programme
Arctic Indigenous communities and other Arctic (AMAP) : monitors the Arctic environment,
inhabitants on issues such as sustainable ecosystems and human populations, and provides
development and environmental protection. scientific advice to support governments as they
▪ The Arctic Council has conducted studies tackle pollution and adverse effects of climate
on climate change, oil and gas, and Arctic change.
shipping. ▪ Conservation of Arctic Flora and Fauna
(CAFF) : addresses the conservation of Arctic
Members, Observer and Permanent biodiversity, working to ensure the sustainability
Participant of the Arctic’s living resources.
▪ Emergency Prevention, Preparedness and
▪ Members: The eight countries with sovereignty Response (EPPR) : protect the Arctic
over the lands within the Arctic Circle constitute environment from the threat or impact of an
the members of the accidental release of pollutants or radionuclides.
council: Canada, Denmark, Finland, Iceland, N ▪ Protection of the Arctic Marine Environment
orway, Russia, Sweden, and the United States. (PAME) : protection and sustainable use of the
▪ Observer Status: Observer status in the Arctic Arctic marine environment.
Council is open to non-Arctic states, along with

228
▪ Sustainable Development Working Group ▪ As routes open up because of climate change, the
(SDWG) : works to advance sustainable non-renewable resources previously inaccessible
development in the Arctic and to improve the will then be extracted, and these activities in turn
conditions of Arctic communities as a whole will contribute to further global warming.

Three Legally Binding Agreement Arctic not a Global Common

▪ The first, the Agreement on Cooperation on ▪ There is a lack of overarching guidelines for how
Aeronautical and Maritime Search and Rescue stakeholders can engage the Arctic’s resources,
in the Arctic, was signed in Nuuk, Greenland, at akin to the Antarctic Treaty of 1959 that limited
the 2011 Ministerial Meeting. the use of the Antarctic only for scientific and
▪ The second, the Agreement on Cooperation on peaceful purposes and freed it from any territorial
Marine Oil Pollution Preparedness and Response claims making the Antarctic a global common.
in the Arctic, was signed in Kiruna, Sweden, at
the 2013 Ministerial meeting. Ease of navigability
▪ Third, the Agreement on Enhancing
International Arctic Scientific Cooperation, was ▪ It triggered by ice-melt giving rise to new shipping
signed in Fairbanks, Alaska at the 2017 routes: The other area of potential disputes relates
Ministerial meeting. to the opening of new shipping routes (via Canada,
US, Russia) owing to the melting Arctic ice.
Arctic Characteristics and Issues Advantages will be huge economic returns via:
1. Shortening of journey time (40-percent shorter
Resource rich Arctic distances between Europe and East Asia.)
2. Reduction of costs.
▪ Varied estimates suggest that the Arctic holds a 3. Free of piracy and terrorism thus more secure than
significant portion of 30% of the world’s the conventional see lanes.
undiscovered natural gas and 13% of its 4. Estimates suggest that by 2025, over 60 million
undiscovered oil reserves. tonnes of energy resources will be transported via
▪ However, exploitation of the resources has been the Northern Sea Route, including coal and LNG.
difficult because of the natural barriers created by
harsh weather conditions and difficult terrain. India and the Arctic
▪ Also, the resources are unevenly distributed, for
instance, the Russian region is richer in gas ▪ India launched its first scientific expedition to
reserves, while the Norwegian region has more the Arctic Ocean in 2007 and opened a research
oil resources. base named "Himadri” at the International
Arctic Research Base at Ny-Alesund, Svalbard,
Scramble for Arctic Norway in July 2008 for carrying out studies in
disciplines like Glaciology, Atmospheric sciences
▪ As the various countries scramble for a share of its & Biological sciences.
resources, it could give rise to conflict and ▪ India has been closely following the developments
tensions. Recently, China has released its first in the Arctic region in the light of the new
official Arctic policy white paper, outlining its opportunities and challenges emerging for the
ambition for a Polar Silk Road. There are existing international community due to global
disputes related to territorial claims between the warming induced melting of Arctic’s ice cap.
region’s coastal states, such as those between ▪ India’s interests in the Arctic region are scientific,
Canada and Greenland, Russia and the US etc. environmental, commercial as well as strategic.
▪ In July 2018, Ministry of Earth
Environmental hazards Sciences renamed the Goa based “National
Centre for Antarctic and Ocean Research” to
▪ There is also the danger of extraction activities the “National Centre for Polar and Ocean
triggering negative consequences on the fragile Research.”
Arctic ecosystem, such as oil spills, as was seen in ▪ It is a nodal organisation coordinating the research
the 1989 Exxon Valdez oil spill in Alaskan waters. activities at the stations at the poles.
▪ It will create the so-called ‘Arctic-paradox’. ▪ India has also entered into MOU with Norwegian
Polar Research Institute of Norway, for
cooperation in science, and also with Kings

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 Bay (A Norwegian Government owned company) and ice core records from the Arctic glaciers
at Ny-Alesund for the logistic and infrastructure and the Arctic Ocean.
facilities for undertaking Arctic research and 2. To characterize sea ice in the Arctic using
maintaining Indian Research base ‘Himadri’ at satellite data to estimate the effect of global
Arctic region. warming in the northern polar region.
▪ In 2019, India has been re-elected as an 3. To conduct research on the dynamics and
Observer to the Council. mass budget of Arctic glaciers focusing on
▪ India does not have an official Arctic policy and the effect of glaciers on sea-level change.
its Arctic research objectives have been centred on 4. To carry out a comprehensive assessment of
ecological and environmental aspects, with a focus the flora and fauna of the Arctic and their
on climate change, till now. response to anthropogenic activities. In
▪ The major objectives of the Indian Research addition, it is proposed to undertake a
in Arctic Region are as follows: comparative study of the life forms from both
the Polar Regions
1. To study the hypothesized tele-
connections between the Arctic climate and
the Indian monsoon by analyzing the sediment
Commercial and Strategic Interests

▪ The Arctic region is very rich in minerals, and oil and gas. With some parts of the Arctic melting due to global
warming, the region also opens up the possibility of new shipping routes that can reduce existing distances.
▪ Countries already have ongoing activities in the Arctic hope to have a stake in the commercial exploitation of
natural resources present in the region.
▪ The Arctic Council does not prohibit the commercial exploitation of resources in the Arctic. It only seeks to
ensure that it is done in a sustainable manner without harming the interests of local populations and in conformity
with the local environment.
▪ Therefore, to stay relevant in the Arctic region, India should take advantage of the observer status it has earned in
the Arctic Council and consider investing more in the Arctic.

Why is it significant to India?

▪ The Arctic Council does not prohibit the commercial exploitation of resources in the Arctic.
▪ It only seeks to ensure that it is done in a sustainable manner.
▪ So countries with ongoing activities in the Arctic hope to have a stake in the commercial exploitation of
natural resources there.
▪ India could derive some commercial and strategic benefits, given the fact that the Arctic region is rich in some
minerals, and oil and gas,
▪ With some parts of the Arctic melting due to global warming, the region also opens up the possibility of new
shipping routes.

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 CH-13 ASIAN INFRASTRUCTURAL INVESTMENT BANK (AIIB)
Basics and Backgrounds
Board of Governors
▪ The Asian Infrastructure Investment Bank (AIIB)
is a multilateral development bank with a mission ▪ The Board of Governors consists of one Governor
to improve social and economic outcomes in Asia. and one Alternate Governor appointed by
▪ It is established by the AIIB Articles of each member country.
Agreement (entered into force Dec. 25, 2015) ▪ The Board of Governors may delegate to the
which is a multilateral treaty. The Parties (57 Board of Directors any or all its
founding members) to agreement comprise the powers, except the power to:
Membership of the Bank. 1. admit new members and determine the conditions
▪ It is headquartered in Beijing and began its of their admission;
operations in January 2016. 2. increase or decrease the authorized capital stock
▪ The members to Bank have now grown to 97 of the Bank;
approved members worldwide. There are 27 3. elect the Directors of the Bank and determine the
prospective members including Armenia, expenses to be paid for Directors and Alternate
Lebanon, Brazil, South Africa, Greece, etc. Directors and remuneration;
▪ Fourteen of the G-20 nations are AIIB members 4. elect the President, suspend or remove him from
including France, Germany, Italy and the United office, and determine his remuneration and other
Kingdom. conditions of service;
▪ By investing in sustainable infrastructure and 5. approve, after reviewing the auditors’ report, the
other productive sectors in Asia and beyond, it will general balance sheet and the statement of profit
better connect people, services and markets that and loss of the Bank;
over time will impact the lives of billions and 6. amend the 'AIIB Articles of Agreement'
build a better future.
Board of Directors
Goals
▪ The Board of Directors are composed of twelve
▪ To foster sustainable economic members who shall not be members of the Board
development, create wealth and improve of Governors, and of whom:
infrastructure connectivity in Asia by investing in ✓ nine are elected by the Governors representing
infrastructure and other productive sectors. regional members; and
▪ To promote regional cooperation and ✓ three are elected by the Governors
partnership in addressing development challenges representing non-regional members.
by working in close collaboration with other
multilateral and bilateral Senior Management
development institutions.
▪ To promote investment in the public and ▪ AIIB staff is headed by the President who is
private capital for development purposes, in elected by AIIB shareholders for a five-year term
particular for development of infrastructure and and eligible for reelection once.
other productive sectors. ▪ The President is supported by Senior Management
▪ To utilize the resources at its disposal for which includes five Vice Presidents responsible
financing such development in the region, for:
including those projects and programs which will 1. policy and strategy
contribute most effectively to the harmonious 2. investment operations, finance
economic growth of the region; 3. administration and the corporate secretariat and the
▪ To encourage private investment in General Counsel
projects, enterprises and activities contributing to 4. Chief Risk Officer and Chief Programmer Officer
economic development in the region when private
capital is not available on reasonable terms and International Advisory Panel
conditions.
▪ The Bank has established an International
Various Organs of AIIB Advisory Panel (IAP) to support the President and

231
 Senior Management on the Bank’s strategies and ▪ India is the second-largest shareholder,
policies as well as on general operational issues. contributing USD 8.4 billion.
▪ The Panel meets in tandem with the Bank’s
Annual Meeting, or as requested by the President. Voting Rights
▪ The President selects and appoints members of the
IAP to two-year terms. ▪ China is the largest shareholder with 26.61 %
▪ Panellist receive a small honorarium and do not voting shares in the bank followed by India
receive a salary. The Bank pays the costs (7.6%), Russia (6.01%) and Germany (4.2 %).
associated with Panel meetings. ▪ The regional members hold 75% of the total voting
power in the Bank.
Annual Meeting
AIIB Financing Framework
▪ The first AIIB Board of Governors meeting was
held in Beijing, China in 2016. ▪ The recipients of AIIB financing may
▪ The second was held in Jeju, Korea in 2017 and include member countries (or agencies and
the third was held in Mumbai, India in 2018. entities or enterprises in member territories), as
▪ On July 12-13, 2019 Luxembourg will well as international or regional
host AIIB’s first Annual Meeting to be held agencies concerned with the economic
outside Asia. development of the Asia-Pacific region.
▪ The theme of the 2019 Annual ▪ The AIIB has signed a co-financing framework
Meeting is “Cooperation and Connectivity” in agreement with the World Bank and three
recognition of the economic and social benefits to nonbinding Memoranda of Understanding (MOU)
be realized through better connectivity within and with:
between countries and regions, including Europe 1. Asian Development Bank (ADB),
and Asia. 2. European Bank for Reconstruction and
Development (EBRD),
Membership 3. European Investment Bank (EIB).
▪ The bulk of AIIB’s operations are in South Asia.
▪ Membership in the AIIB is open to all members ▪ The Bank can lend outside Asia provided that it
of the World Bank or the Asian Development supports connectivity with Asia or it is for a global
Bank and is divided into regional and non- public good and that the loan significantly benefits
regional members. Asia.
▪ Regional members are those located within areas
classified as Asia and Oceania by the United China and AIIB
Nations.
▪ Unlike other MDBs (multilateral development ▪ The creation of the AIIB is part of a broader
bank), the AIIB allows for non-sovereign reorientation of Chinese foreign and
entities to apply for AIIB membership, assuming international economic policy that has taken
their home country is a member. place since Xi Jinping became Chinese
Communist Party General Secretary in 2012 and
Financial Resources of AIIB the President in 2013.
▪ To realize the vision of “One Belt, One Road”
▪ Paid-Up Share Capital: It is the amount of (OBOR) Initiative, China is investing in a range
money that has already been paid by investors in of institutions and initiatives, including
exchange for shares of stock. the AIIB, and other funding mechanisms such as
▪ Called-Up Share Capital: Some companies may the Silk Road Fund (established in 2014) and
issue shares to investors with the understanding the New Development Bank (also known as
they will be paid at a later date. the BRICS Bank established in 2014), a collective
▪ This allows for more flexible investment arrangement with Brazil, Russia, India, and South
terms and may entice investors to contribute Africa.
more share capital than if they had to provide ▪ China also seeks to influence the emerging
funds up front. structure of regional trade and
▪ China is the largest contributor to the Bank, investment relations.
contributing USD 50 billion, half of the initial
subscribed capital. India and AIIB

232
 ▪ It is well proved throughout the history of
▪ India was among the AIIB’s 57 founding economic growth & development that the creation
members in 2016. and development of robust financial institutions
▪ It is also its second-largest shareholder (with will make market forces more competitive leading
7.62% voting shares) after China (26.06%). towards comprehensive growth and development
▪ It has received USD 4.35 billion from the Bank. of society.
▪ AIIB has approved financing projects in India in a ▪ India should continue to engage with AIIB as it
host of sectors like energy, transport and water will be able to access resources for the financing
including the Bangalore metro rail project (USD of national and cross-border infrastructure projects
335 million), Gujarat rural roads project (USD from the Bank.
329 million) and Phase 3 of the Mumbai urban ▪ AIIB is also significant as the World Bank is
transport project (USD 500 million). continued to be dominated by the
▪ AIIB's third Annual Meeting was held in USA while Japan has more influence over Asian
Mumbai, India on June 25 and 26, 2018. The Development Bank (ADB).
theme was “Mobilizing Finance for Infrastructure: ▪ Further, India needs to ensure that its own interests
Innovation and Collaboration,” in recognition of are served by its membership very explicitly. It
the private sector's vital role in bridging the should make sure that AIIB doesn’t end up
infrastructure gap. becoming a tool of Chinese geopolitical agenda.
▪ In a recent virtual meeting, India said that it
expects AIIB to introduce new financing
instruments, provide financing for social
infrastructure and to integrate development of
climate resilient and sustainable energy access
infrastructure into AIIB’s recovery response to the
Covid-19 crisis.
▪ In June 2020, AIIB approved USD 500 million for
Covid-19 Emergency Response Fund and
Health Systems Preparedness Project and
another USD 750 million for Covid-19 Active
Response and Expenditure Support, in a co-
financing arrangement with the Asian
Development Bank (ADB).

Concern for India

▪ China Factor is a bone of contention for India

▪ There are various issues between India and China:
1. Indian membership in the Nuclear Suppliers
Group (China maintains that it will not support
India’s entry until there is a universal formula to
accept applications from all countries that haven’t
signed the Non-Proliferation Treaty- indirectly
pursuing case for Pakistan),
2. territorial disputes in the Himalayas,
3. concerns over the China-Pakistan Economic
Corridor’s traversal of disputed territory in
Kashmir.
▪ India has serious concerns over Chinese foreign
policy in its region generally and the OBOR
initiative specifically, regarding Beijing’s
attempts to seek influence in its immediate
neighborhood with great interest.

Way Forward

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CH-14 CONVENTION ON INTERNATIONAL TRADE IN
ENDANGERED SPECIES OF WILD FAUNA AND FLORA) CITES
▪ It accords varying degrees of protection to more
Basic and Backgrounds than 35,000 species of animals and plants.
▪ In order to ensure that the General Agreement on
▪ CITES (the Convention on International Trade Tariffs and Trade (GATT) was not violated, the
in Endangered Species of Wild Fauna and Secretariat of GATT was consulted during the
Flora, also known as the Washington drafting process.
Convention) is a multilateral treaty to protect
endangered plants and animals. Structure
▪ It was drafted as a result of a resolution adopted in
1963 at a meeting of members of
the International Union for Conservation of
Nature (IUCN).
▪ The convention was opened for signature in 1973
and CITES entered into force on 1 July 1975.
▪ CITES is legally binding on state parties to the
convention, which are obliged to adopt their own
domestic legislation to implement its goals.

▪ The CITES Secretariat is administered by UNEP

(The United Nations Environment Programme)
and is located at Geneva, Switzerland.
▪ It plays a coordinating, advisory and servicing role
in the working of the Convention (CITES).

International Union for Conservation of Function

Nature (IUCN
▪ The CITES works by subjecting international trade
▪ The International Union for Conservation of in specimens of selected species to certain
Nature (IUCN) officially International Union controls.
for Conservation of Nature and Natural ▪ All import, export, re-export and
Resources is an international introduction from the sea of species covered by
organization working in the field of nature the Convention has to be authorized through a
conservation and sustainable use of natural licensing system.
resources. ▪ Each Party to the Convention must designate one
▪ It is involved in data gathering and analysis, or more Management Authorities in charge
research, field projects, advocacy, and of administering that licensing system and one
education. or more Scientific Authorities to advise them on
▪ IUCN's mission is to "influence, encourage and the effects of trade on the status of the species.
assist societies throughout the world to conserve ▪ Appendices I, II and III to the
nature and to ensure that any use of natural Convention are lists of species afforded different
resources is equitable and ecologically levels or types of protection from over-
sustainable". exploitation.

Objective Classifications of CITES Appendix

▪ Its aim is to ensure that international trade in ▪ Appendix I: It lists species that are in danger of
specimens of wild animals and plants does not extinction. It prohibits commercial trade of these
threaten their survival.

234
 plants and animals except in extraordinary ▪ Illegal trade is estimated by it to be worth
situations for scientific or educational reasons. between USD 5 billion and USD 20 billion per
▪ Appendix II species: They are those that are not year. CITES has played a pivotal role in
threatened with extinction but that might suffer a containing the illegal activities that is driving
serious decline in number if trade is not restricted. many species towards extinction, and depriving
Their trade is regulated by permit. local people of development choices and
▪ Appendix III species: They are protected in at governments of potential revenue.
least one country that is a CITES member states ▪ The International Consortium on Combating
and that has petitioned others for help in Wildlife Crime (ICCWC), a consortium of
controlling international trade in that species. the CITES Secretariat,
INTERPOL (International Criminal Police
CITES COP Organization), the UN Office on Drugs and
Crime, the World Bank and the World Customs
▪ The Conference of the Parties (CoP) meet every Organization has been established to tackle
two to three years. illegal wildlife trade. It brings together the entire
▪ The CITES Committees (Animals Committee, enforcement chain to assist national enforcement
Plants Committee and Standing Committee) authorities and regional bodies to combat illicit
hold meetings during each year that does not have trade in wildlife.
a CoP, while the Standing committee meets also
in years with a CoP. CITES and India
▪ The Committee meetings take place
in Geneva, Switzerland, unless another country ▪ India is a CITES Party since 1976.
offers to host the meeting. ▪ Due to its extreme diversity, India is recognized all
▪ The latest COP was CITES COP18 that took over the world for harbouring up to 7-8% of all the
place in August 2019 at Geneva, Switzerland. species recorded by CITES.
▪ CITES COP3 took place in India in 1981 in ▪ Out of 34 global biodiversity hotspots in the
New Delhi. world, India has 4 of them: Western Ghats,
▪ They provide the occasion for the Parties to: Sundaland, Himalayas and Indo-Burma region.
o Review progress in the conservation of ▪ As an active CITES Party, India prohibits the
species included in the Appendices; international trade of endangered wild species.
o Consider (and where appropriate adopt) ▪ India has placed several measures to control the
proposals to amend the lists of species in threats from invasive alien species.
Appendices I and II; ▪ This is done by regulating the trade by export
o Consider discussion documents and certificates and import permits.
reports from the Parties, the permanent
committees, the Secretariat and working India at COP18/2019
groups;
o Recommend measures to improve the ▪ India has proposed to remove rosewood
effectiveness of the Convention; and (Dalbergia sissoo) from Appendix II of CITES.
o Make provisions (including the adoption The species grows at a very fast rate and has the
of a budget) necessary to allow the capacity to become naturalised outside its native
Secretariat to function effectively. range, it is invasive in other parts of the world as
well.
CITES Contribution ▪ India has also proposed to transfer small clawed
otters (Aonyx cinereus), smooth coated
▪ The CITES regulates international trade in close otters (Lutrogale perspicillata), Indian Star
to 35,000 species of plants and animals. Tortoise (Geochelone elegans) from Appendix II
▪ CITES has been at the cutting edge of the debate to Appendix I, thereby giving more protection to
on the sustainable use of biodiversity for the past the species.
42 years and it has records of over 12,000,000 ▪ The proposal also includes inclusion of Gekko
international trade transactions in its data- gecko and Wedgefish (Rhinidae) in Appendix II
bases for that period – trade which on many of CITES
occasions has benefitted local communities, such
as with the vicuña in South America.

235
Limitations

General limitations about the structure and philosophy of CITES include:

▪ By design and intent it focuses on trade at the species level and does not address habitat loss, ecosystem
approaches to conservation, or poverty;
▪ It seeks to prevent unsustainable use rather than promote sustainable use (which generally conflicts with
the Convention on Biological Diversity), although this has been changing.
▪ It does not explicitly address market demand.
▪ CITES listings have been demonstrated to increase financial speculation in certain markets for high value species.
▪ Funding does not provide for increased on-the-ground enforcement (it must apply for bilateral aid for most
projects of this nature).

Way Forward

▪ More regular missions by the Secretariat (not reserved just for high-profile species);
▪ Improvement of national legislation and enforcement; better reporting by Parties (and the consolidation of
information from all sources-NGOs, TRAFFIC, the wildlife trade monitoring network and Parties);
▪ More emphasis on enforcement-including a technical committee enforcement officer; the development of CITES
Action Plans (akin to Biodiversity Action Plans related to the Convention on Biological Diversity) including
designation of Scientific/Management Authorities and national enforcement strategies;
▪ CITES would benefit from access to Global Environment Facility (GEF) funds, although this is difficult given the
GEFs more ecosystem approach-or other more regular funds.
▪ Development of a future mechanism similar to that of the Montreal Protocol (developed nations contribute to a
fund for developing nations) could allow more funds for non-Secretariat activities.

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CH-15 UNITED NATIONS FRAMEWORK CONVENTION ON
CLIMATE CHANGE (UNFCCC)
COP session. Their role is to facilitate the work of
Basic and Background the COP and promote agreements among Parties.
▪ The work of the COP and each subsidiary body is
▪ The United Nations Framework Convention on guided by an elected Bureau. To ensure continuity,
Climate Change (UNFCCC) is it serves not only during sessions, but between
an international environmental treaty which sessions as well.
seeks to reduce atmospheric concentrations
of greenhouse gases, with the aim of preventing
dangerous anthropogenic interference with the 3. Subsidiary Bodies (SBs)
earth's climate system. ▪ The Convention establishes two permanent
▪ The UNFCCC, signed in 1992 at the United subsidiary bodies (SBs), namely the Subsidiary
Nations Conference on Environment and Body for Scientific and Technological Advice
Development also known as the Earth Summit, (SBSTA), by Article 9, and the Subsidiary Body
for Implementation (SBI), by Article 10. These
the Rio Summit or the Rio Conference
bodies advise the COP.
▪ It is a framework which requires individual
▪ The SBSTA’s task is to provide the COP “with
participating countries to commit to stabilizing timely advice on scientific and technological
greenhouse gas emissions. matters relating to the Convention”.
▪ There are 197 parties to the convention, who meet ▪ The SBI’s task is to assist the COP “in the
annually in Conferences of the Parties (COP) to assessment and review of the effective
assess progress in dealing with climate change. implementation of the Convention”
Objective 4. The Secretariat
▪ The secretariat, also known as the Climate Change
▪ According to Article 2, the Convention’s ultimate Secretariat, services the COP, the SBs, the Bureau
objective is “to achieve, stabilization of
and other bodies established by the COP.
greenhouse gas concentrations in the
atmosphere at a level that would prevent 5. Other Bodies
dangerous anthropogenic interference with the
▪ Other bodies have been set up by the COP to
climate system”. undertake specific tasks. These bodies report back
▪ This objective is qualified in that it “should be to the COP when they complete their work
achieved within a time frame sufficient to allow ▪ COP 1 established two ad hoc groups to conduct
ecosystems to adapt naturally to climate negotiations on specific issues.
change, to ensure that food production is not
▪ COP 11 established the “Dialogue” to exchange
threatened and to enable economic experiences and analyse strategic approaches for
development to proceed in a sustainable long-term cooperative action to address climate
manner”. change.
Structure
1. The Conference of the Parties (COP) Kyoto Protocol
▪ Article 7.2 defines the COP as the “supreme body” ▪ The Kyoto Protocol was adopted in Kyoto, Japan,
of the Convention, as it is its highest decision-
in 1997.
making authority. ▪ India ratified Kyoto Protocol in 2002.
▪ The climate change process revolves around the ▪ The Kyoto Protocol came into force in
annual sessions of the COP. February 2005.
▪ There are currently 192 Parties.
2. COP President and Bureau
▪ USA never ratified Kyoto Protocol.
▪ The office of the COP President normally rotates ▪ Canada withdrew in 2012.
among the five United Nations regional groups. ▪ Goal: Fight global warming by reducing
The President is usually the environment minister greenhouse gas concentrations in the atmosphere
of his or her home country. S/he is elected by to “a level that would prevent dangerous
acclamation immediately after the opening of a

237
 anthropogenic interference with the climate ▪ Groups of hydro fluorocarbons (HCFs) and
system.” ▪ Groups of Perfluorocarbons (PFCs).
▪ Kyoto protocol aimed to cut emissions of
greenhouse gases across the developed world by
about 5 per cent by 2012 compared with 1990 Paris Deal
levels.
▪ The Protocol is based on the principle of common ▪ It is an international agreement to combat
but differentiated responsibilities. climate change and to reduce, mitigate
▪ Kyoto Protocol is the only global treaty with greenhouse gas emissions.
binding limits on GHG emissions. ▪ The aims of the Paris Agreement are:
o Keep the global temperature rise this
century well below 2 degrees Celsius
above the pre-industrial level.
o Pursue efforts to limit the temperature
increase even further to 1.5 degrees
Celsius.
o Strengthen the ability of countries to deal
with the impacts of climate change.
▪ Nationally determined contributions
(NDCs) were conceived at Paris summit which
requires each Party to prepare, communicate and
maintain successive nationally determined
contributions (NDCs) that it intends to achieve.
▪ Paris Agreement replaced earlier agreement to
deal with climate change, the Kyoto Protocol.
▪ In the Paris agreement, there is no difference
between developing and developed countries. In
the Kyoto Protocol, there was a differentiation
between developed and developing countries by
clubbing them as Annex 1 countries and non-
Classifications of Parties Associated with
Annex 1 country.
UNFCCC
India’s efforts
The classifications of countries that are signatories to
UNFCCC are given in the table below: ▪ India has achieved a reduction of 21% in the
Category of Parties Meaning emission intensity of its GDP between 2005 and
2014, which fulfils its pre-2020 voluntary target.
Annex I 43 parties (countries) come under this category. The countries that come under
this category are developed countries. ▪ Renewable energy installed capacity
has increased by 226% in the last 5 years and
Annex II 24 countries of Annex I also come under Annex II countries. The countries in
stands more than 87 GW.
this category are expected to provide technical and financial assistance to
▪ 80 million LPG connections are provided in rural
countries coming under the category of developing countries.
areas under PM Ujjwala Yojana, with clean
Annex B The countries in this category are Annex I countries, who have first or second-
cooking fuel and a healthy environment.
round Kyoto greenhouse gas emissions target.
▪ More than 360 million LED bulbs have been
Least-developed 47 Parties (countries) come under the category of LDCs. These countries are
distributed under the UJALA scheme, which has
countries (LDCs) given special status under the treaty taking into consideration their limitations
led to an energy saving of about 47 billion
adapting to the effects of climate change. units of electricity per year and reduction of 38
Non Annex I Parties (countries) that are not listed in Annex I thattonnes
million comeof
under
CO2the
percategory
year.
of low-income developing countries. ▪ India has also leapfrogged from Bharat Stage-IV
(BS-IV) to Bharat Stage-VI (BS-VI)
Kyoto Protocol Emission Target Gases emission norms by April 1, 2020, which was
earlier to be adopted by 2024.
▪ Carbon dioxide (CO2),
▪ Methane (CH4),
▪ Nitrous oxide (N2O), Conference of the Parties 25 (COP25)
▪ Sulphur hexafluoride (SF6),

238
 agreement, but the overriding issue of how fast the
world needs to cut greenhouse gas emissions has
received little official attention.
▪ Countries agreed in Paris in 2015 to revisit their
climate pledges by 2020. But many countries were
pushing this year for a clear call for all countries to
submit more ambitious climate pledges next year.
▪ But countries such as China and Brazil opposed
placing any obligation on countries to submit
enhanced pledges next year, arguing it should be
each country’s own decision. They instead argued
the focus should be on pre-2020 action by
developing countries to meet their previous
CoP pledges
▪ There was a recognition that tougher carbon
▪ The COP is the supreme decision-making body of targets are needed globally, but few countries
the United Nations Framework Convention on came up with any and the resolve to come back
Climate Change (UNFCCC). next year with more ambitious plans was worded
▪ All States that are Parties to the Convention are too weakly to satisfy most campaigners.
represented at the COP.
▪ At COP, they review the implementation of the India’s stance
Convention and any other legal instruments that it
adopts and take decisions necessary to promote the ▪ India played a mixed role at the recently
effective implementation of the Convention. concluded 25th Conference of Parties (CoP 25)
to the United Nations Framework Convention
on Climate Change at Madrid.
Objective ▪ On the question of markets, India emphasised the
▪ The prime objective of the people meeting in transition of the Clean Development Mechanism
Madrid is to complete the rule-book to the 2015 (CDM) credits earned under the Kyoto Protocol
Paris Agreement so that it starts getting to the Paris Agreement.
implemented from 2020. ▪ Pointed out that that excessively cheap emissions
▪ It will happen amid warnings that the world has reductions enabled by the CDM as well as the
not been doing enough to save itself from possibility of double counting could corrupt the
catastrophic impacts of climate change. process.
▪ India played a strong role in critiquing the
Warning developed world’s continuing poor record on
climate action.
▪ Unless countries scale up their actions ▪ It argued that unless a stocktaking exercise of the
significantly, there is little hope of keeping fulfilment of various pre-2020 commitments by
average global temperatures within 2ºC higher developed countries, India would not raise its
than pre-industrial trends. climate ambition for its next round of Paris
▪ This is the warning that is being reiterated by a Agreement targets due in 2020.
series of reports from the Inter-governmental Panel ▪ India also took a lead in calling for more finance
on Climate Change (IPCC) and other agencies for developing countries for climate action.
through the year.
Limitations of UNFCCC
Why CoP25 failed?
▪ Non-inclusive: Most scientists agree the most
▪ The failure of the talks underlined starkly the dangerous environmental air pollutants today are
massive gap between what scientists say the microscopic particulates that come from car
world’s nations need to do on climate change, and engines and combustion-based power plants, but
what the most powerful political leaders on the these pollutants are largely ignored by the Kyoto
planet are prepared to even discuss. Protocol.
▪ According to scientist, talks focused on some of
the rules for implementing the 2015 Paris

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▪ Slow progress: It took a long time for COP to
bring Russia to agree into participating in the CoP 21, 2015:
Kyoto Protocol. (until 2005) • Global Geothermal Alliance
▪ UNFCCC failed to persuade USA to ratify the • Breakthrough Energy Coalition
Kyoto protocol thereby keeping one of the largest • Mission Innovation
emitter of greenhouse gases away from • 4 Per Thousand Initiative
commitments. • Mobilise Your City Programme
▪ Unsustainable targets: The world reached at
almost 1degree Celsius warming post CoP 22, 2016:
industrialization and the Paris contributions are not • Biofuture Platform
enough to maintain 2 degree Celsius levels.
▪ Unsatisfactory Response: Many countries argued CoP 23, 2017:
for a tougher target of 1.5C - including leaders of • Below 50 Initiative
low-lying countries that face unsustainable sea
levels rises in a warming world. CoP 24, 2018:
▪ Financial Constraints: The agreement requires
• Katowice Partnership for Electromobility
rich nations to maintain a $100bn a year funding
pledge beyond 2020, which is not enough as
highlighted by several pacific island countries.
▪ Non-binding agreement: The US withdrawal
from the 2015 Paris climate agreement, citing, that
the deal punished" the US and would cost millions
of American jobs”, has created new barriers and
more pressure on rest of the nations in achieving
the targets of Paris agreement.
▪ No enforcement mechanism: Under the Paris
agreement, each country determines, plans, and
reports its own efforts to mitigate global warming.
The only penalty for non-compliance is a so-called
“name and shame” — or “name and encourage” —
system whereby countries that fall out of
compliance are called out and encouraged to
improve.

Way Forward

▪ Adaptation is increasingly becoming central to

efforts on mitigating the climate change
impacts.
▪ A greater readiness on the part of all nations is
required to take forward the goals on mitigation.
▪ Countries have to compromise on their erstwhile
hard positions, to make progress in reducing
emissions and building climate resilience.
▪ It is entirely appropriate for countries such as India
to insist on not taking on an even more unfair
share of the global mitigation burden unless
developed countries deliver on the minimal
parameter of fulfilling their existing promises.
▪ It is crucial that India continue to push
developed countries in this fashion as the entire
global climate action framework has been put in
jeopardy by the inaction of big polluters.

Various initiatives launched under UNFCCC CoPs:

240
 CH-16 UNITED NATIONS CONVENTION ON BIOLOGICAL
DIVERSITY (UNCBD)

Basics and Backgrounds ▪ Sustainable use of the components of the

Biodiversity
▪ Fair and equitable sharing of benefits arising from
▪ The United Nations Convention on Biological the genetic resources
Diversity (UNCBD) is a United Nations treaty that
is responsible for the conservation of Biological To achieve the above mention goals CBD follow
Diversity around the world. certain Targets and Protocols as follows
▪ The United Nations Convention on Biological
Diversity, informally known as the Biodiversity Goals Targets/Protocols
Convention is a multilateral treaty opened for Protect biodiversity
COP meetings, Aichi
signature at the Earth Summit in Rio De Janeiro in Targets
1992. It is a key document regarding sustainable Safe use of bio- Cartagena Biosafety
development. It comes under the United Nations technology Protocol
Environment Programme (UNEP). Stop unfair use of Nagoya Genetic Resources
▪ 196 countries are a party to the CBD. Genetic resources Protocol
▪ India is also a party to the Convention.
▪ The convention is legally binding on its Functions
signatories.
▪ The Conference of Parties (COP) is the governing
▪ Asserting intrinsic value of biodiversity
body of the convention. It consists of the
▪ Affirming conservation of biodiversity as a
governments that have ratified the treaty.
common concern of population
▪ Its Secretariat is in Montreal, Canada.
▪ Taking responsibility to conserve biodiversity in
▪ Only two member states of the United Nations are
the State and that the state uses this biodiversity
not Parties to the CBD, namely: the USA and the
sustainably
Vatican.
▪ Affirming the State to put the biological resources
▪ In the 1992 Earth Summit, two landmark binding
as the Sovereign Rights of the State.
agreements were signed, one of them being the
▪ Taking a precautionary approach towards
UNCBD. The other one was the Convention on
conservation of biodiversity
Climate Change.
▪ Highlighting the vital role of local communities
▪ More than 150 countries signed the document at
and women
the Summit, and since then, over 175 nations have
▪ Supporting access to technologies for developing
ratified the agreement.
countries and searching for provisions for new and
additional financial resources to address the
Objective biodiversity loss in the region
▪ The conservation of biological diversity, the Cartagena Protocol
sustainable use of its components and the fair and
equitable sharing of the benefits arising out of the
▪ The Cartagena Protocol on Biosafety to the
utilization of genetic resources and by appropriate
Convention on Biological Diversity is an
transfer of relevant technologies, taking into
international treaty governing the movements of
account all rights over those resources and to
living modified organisms (LMOs) resulting
technologies, and by appropriate funding.
from modern biotechnology from one country to
another.
Goals ▪ It was adopted on 29 January 2000 as a
supplementary agreement to the Convention on
▪ Conservation of Biological Diversity Biological Diversity and entered into force on 11
September 2003.

241
 compliance.
Objective

▪ The Cartagena Protocol on Biosafety is an Traditional Knowledge

additional agreement to the Convention on
Biological Diversity. ▪ The Nagoya Protocol addresses traditional
▪ The Protocol establishes procedures for regulating knowledge associated with genetic resources with
the import and export of LMOs from one country provisions on access, benefit-sharing and
to another. compliance.
▪ The Protocol also requires Parties to ensure that ▪ It also addresses genetic resources where
LMOs being shipped from one country to another indigenous and local communities have the
are handled, packaged and transported in a safe established right to grant access to them.
manner. ▪ Contracting Parties are to take measures to ensure
▪ The shipments must be accompanied by these communities’ prior informed consent, and
documentation that clearly identifies the LMOs, fair and equitable benefit-sharing, keeping in mind
specifies any requirements for the safe handling, community laws and procedures as well as
storage, transport and use and provides contact customary use and exchange.
details for further information.
Strategic Plan for Biodiversity 2011-2020
Nagoya Protocol
▪ In the tenth meeting of the Conference of the
▪ The Nagoya Protocol on Access to Genetic Parties, held in 2010, in Nagoya, Aichi Prefecture,
Resources and the Fair and Equitable Sharing of Japan, adopted a revised and updated Strategic
Benefits Arising from their Utilization (ABS) to Plan for Biodiversity, including the Aichi
the Convention on Biological Diversity is a Biodiversity Targets, for the 2011-2020 period.
supplementary agreement to the Convention on ▪ The tenth meeting of the Conference of the Parties
Biological Diversity. agreed to translate this overarching international
▪ It provides a transparent legal framework for the framework into national biodiversity strategies and
effective implementation of one of the three action plans within two years.
objectives of the CBD. ▪ Additionally, the meeting decided that the fifth
national reports, due by 31 March 2014, should
Objective focus on the implementation of the 2011-2020
Strategic Plan and progress achieved towards the
▪ The fair and equitable sharing of benefits arising Aichi Biodiversity Targets.
from the utilization of genetic resources, thereby
contributing to the conservation and sustainable 12 National Biodiversity targets of India
use of biodiversity.
1. By 2020, a significant proportion of the country’s
Obligations population, especially the youth, is aware of the
values of biodiversity and the steps they can take
▪ The Nagoya Protocol sets out core obligations for to conserve and use it sustainably.
its contracting Parties to take measures in relation 2. By 2020, values of biodiversity are integrated into
to access to genetic resources, benefit-sharing and national and state planning processes, development
programmes and poverty alleviation strategies.
3. Strategies for reducing the rate of degradation,
fragmentation and loss of all natural habitats are
Access Obligations finalized and actions put in place by 2020 for
environmental amelioration and human well-
Obligations

Benefit Sharing being.

Obligations 4. By 2020, invasive alien species and pathways are
identified and strategies to manage them
Compliance developed so that populations of prioritized
Obligations invasive alien species are managed.
5. By 2020, measures are adopted for sustainable
management of agriculture, forestry and fisheries.

242
6. Ecologically representative areas under terrestrial A biodiversity loss by mainstreaming
and inland water, and also coastal and marine biodiversity across government and
zones, especially those of particular importance for society.
species, biodiversity and ecosystem services, are Strategic Goal Reduce the direct pressures on
conserved effectively and equitably, based on B biodiversity and promote sustainable
protected area designation and management and use.
other area-based conservation measures and are
integrated into the wider landscapes and seascapes, Strategic Goal To improve the status of biodiversity
covering over 20% of the geographic area of the C by safeguarding ecosystems, species
country, by 2020. and genetic diversity.
7. By 2020, genetic diversity of cultivated plants, Strategic Goal Enhance the benefits to all from
farm livestock, and their wild relatives, including D biodiversity and ecosystem services.
other socio-economically as well as culturally Strategic Goal Enhance implementation through
valuable species, is maintained, and strategies have E participatory planning, knowledge
been developed and implemented for minimizing management and capacity building
genetic erosion and safeguarding their genetic
diversity. India’s Sixth Report
8. By 2020, ecosystem services, especially those
▪ India recently submitted its Sixth National
relating to water, human health, livelihoods and Report to the Convention on Biological
well-being, are enumerated and measures to
Diversity (CBD).
safeguard them are identified, taking into account
▪ India is among the first five countries in the
the needs of women and local communities,
world, the first in Asia and the first among the
particularly the poor and vulnerable sections. biodiversity-rich mega diverse countries to have
9. By 2015, Access to Genetic Resources and the
submitted the report.
Fair and Equitable Sharing of Benefits Arising
▪ The submission of national reports is a mandatory
from their Utilization as per the Nagoya Protocol obligation on parties to international treaties,
are operational, consistent with national including the CBD.
legislation.
▪ As a responsible nation, India has never reneged
10. By 2020, an effective, participatory and updated on its international commitments and has earlier
national biodiversity action plan is made
submitted on time five national reports to the
operational at different levels of governance.
CBD.
11. By 2020, national initiatives using communities’
traditional knowledge relating to biodiversity are Highlights of the Report
strengthened, with the view to protecting this
knowledge in accordance with national legislation
▪ The report provides an update of progress in
and international obligations. achievement of 12 National Biodiversity
12. By 2020, opportunities to increase the availability
Targets (NBT) developed under the convention
of financial, human and technical resources to
process in line with the 20 global Aichi
facilitate effective implementation of the Strategic biodiversity targets.
Plan for Biodiversity 2011-2020 and the national
▪ The report highlights that while India has
targets are identified and the Strategy for Resource
exceeded/ overachieved two NBTs, it is on track to
Mobilization is adopted.
achieve eight NBTs and with respect to two
remaining NBTs, the country is striving to meet
Aichi Targets the targets by the stipulated time of 2020.
▪ According to the report, India has exceeded the
▪ The ‘Aichi Targets’ were adopted by the terrestrial component of 17% of Aichi target 11,
Convention on Biological Diversity (CBD) at its and 20% of corresponding NBT relating to areas
Nagoya conference. under biodiversity management.
▪ It is a short term plan provides a set of 20 ▪ Also, India has been investing a huge amount on
ambitious yet achievable targets, collectively biodiversity directly or indirectly through several
known as the Aichi Targets. development schemes of the central and state
governments, to the tune of Rs 70,000 crores per
Strategic Goal Targets annum as against the estimated annual requirement
Strategic Goal Address the underlying causes of of nearly Rs 1,09,000 crore.

243
Criticism

▪ There have been criticisms against CBD that the convention has been weakened in implementation due to the
resistance of Western countries to the implementation of the pro-South provisions of the convention.
▪ CBD is also regarded as a case of a hard treaty gone soft in the implementation trajectory.
▪ The argument to enforce the treaty as a legally binding multilateral instrument with the Conference of Parties
reviewing the infractions and non-compliance is also gaining strength.
▪ Although the convention explicitly states that all forms of life are covered by its provisions, examination of
reports and of national biodiversity strategies and action plans submitted by participating countries shows that in
practice this is not happening.
▪ Scientists working with biodiversity and medical research are expressing fears that the Nagoya Protocol is
counterproductive, and will hamper disease prevention and conservation efforts, and that the threat of
imprisonment of scientists will have a chilling effect on research.
▪ Non-commercial researchers and institutions such as natural history museums fear maintaining biological
reference collections and exchanging material between institutions will become difficult, and medical researchers
have expressed alarm at plans to expand the protocol to make it illegal to publicly share genetic information, e.g.
via GenBank.

244
 CH-17 NEW DEVELOPMENT BANK
Basics and Backgrounds
▪ It is a multilateral development bank operated Open and
by the BRICS states (Brazil, Russia, India, China Approachable

and South Africa).

▪ The New Development Bank was agreed to by Transparen Transform
t ative
BRICS leaders at the 5th BRICS summit held in
Durban, South Africa in 2013.
▪ It was established in 2014, at the 6th BRICS
Summit at Fortaleza, Brazil.
Values
▪ The bank is set up to foster greater financial and
development cooperation among the five Egalitarian Sustainable
emerging markets.
▪ In the Fortaleza Declaration, the leaders stressed
that the NDB will strengthen cooperation among
BRICS and will supplement the efforts of Flexible Bold and
multilateral and regional financial institutions for and Path-
Adaptive breaking
global development.
▪ The bank will be headquartered in Shanghai,
China. ▪ The Agreement on the New Development Bank
▪ Unlike the World Bank, which assigns votes based entered into force in July 2015, with the official
on capital share, in the New Development declaration of all five states that have signed it.
Bank each participant country will be assigned The five founding members of the Bank include
one vote, and none of the countries will have Brazil, Russia, India, China and South Africa.
veto power. ▪ Bank's Articles of Agreement specify that all
▪ K. V. Kamath, from India, is the first elected members of the United Nations could be
president of the NDB. He was replaced as members of the bank, however the share of the
president by Marcos Prado Troyjo from Brazil BRICS nations can never be less than 55% of
since 7 July 2020. Marcos Troyjo was elected voting power.
president of the New Development Bank on 27 ▪ Expanding the NDB's membership is considered
May 2020 by some experts to be crucial to its long-term
development by helping boost the bank's
Objectives business growth.
▪ According to the Bank's General Strategy: 2017–
▪ Fostering development of member countries. 2021, the NDB plans to expand membership
▪ Supporting economic growth. gradually so as not to overly strain its operational
▪ Promoting competitiveness and facilitating job and decision-making capacity.
creation.
▪ Building a knowledge sharing platform among 5th Annual Meeting of Board of Governors of
developing countries. New Development Bank

Values ▪ India asked the New Development Bank (NDB) to

enhance emergency facility to $10 billion to deal
▪ The New Development Bank is a partner in with the challenges posed by the outbreak of
development that goes beyond the conventional COVID-19 pandemic.
codes of multilateral banks. It represents, operates ▪ The country appreciated the efforts of the
and is recognized for its values that fulfil the multilateral lending agency on fast tracking of
founding vision. financial assistance of about $5 billion to BRICS
countries, including an emergency assistance of $1
billion to India to combat COVID-19 pandemic.
▪ Lauding efforts of the NDB in establishing itself as
Membership: a credible Global Financial Institution, India said it
should take appropriate actions to join G-20 forum

245
 along with other Multilateral Development Bank (IFIs).
(MDBs)/ International Financial Institutions
Measures taken by India to respond to COVID-19 crisis

▪ Creating a COVID-19 Emergency Fund

▪ Allocation of $2 billion (Rs 15,000 crore) by the government for strengthening the healthcare system.
▪ Announcement of a scheme of social support measures amounting to $25 billion (Rs 1.70 lakh crore) to alleviate
the hardship of the poor and the vulnerable.
▪ Insurance cover of $67,000 (Rs 50 lakh) per person to over 2.2 million frontline health workers and others
provision of relief to firms in statutory and regulatory compliance matters.
▪ Easing of monetary policy by the Reserve Bank of India.
▪ Supplying critical medicine to the needy countries to tackle the COVID-19.

NDB Approved Projects in India:

Renewable Energy:
Canara Bank Renewable Energy Financing Scheme
Madhya Pradesh Major District Roads Project

Sustainable Development:
Madhya Pradesh Multi Village Water Supply Project

Irrigation, agriculture:
Rajasthan Water Sector Restructuring Project

Transportation:
Bihar Rural Roads Project
Madhya Pradesh Bridges Project
Madhya Pradesh Major District Roads II Project
Mumbai Metro Rail Project
Assam Bridge Project
Andhra Pradesh Road Sector Project

246
 CH-18 AFRICAN DEVELOPMENT BANK

Basics and Backgrounds ▪ The AfDB is also required to give special

attention to national and multinational projects
▪ ADB is a multilateral development finance which are needed to promote regional integration.
institution. ▪ Other functions include
▪ It provides finance to African governments and 1. Mobilizing financial resources from the
private companies investing in the Regional Government or the foreign financial institutions
Member Countries (RMC). with
▪ It was founded in 1948. 2. A view to lending the money for development of
▪ Its fundamental duty is to fight poverty and specific sectors of the economy.
improve the standard of living of the continent by
investing in projects and programs which uplifts Status
the socio-economic conditions of the common
mass. ▪ The AfDB promotes economic development and
▪ The Headquarter is located in in Abidjan, Côte social progress of its RMCs in Africa.
d’Ivoire. But it moved to Tunis, Tunisia in 2003, ▪ It’s relatively small lending and tendency to
before returning in September 2014. follow in the footsteps of more prominent
▪ The AfDB is controlled by a Board of Executive public institutions like the World Bank, implies
Directors, made up of representatives of its that the African Development Bank has been
member countries. receiving little interest from civil society
▪ Akinwumi Ayodeji Adesina is the 8th organizations as well as academia.
elected President of the African Development ▪ AfDB emphasizes the role of women along with
Bank Group, on September 1, 2015. education reforms, and lent its support to key
▪ Member governments are officially represented at initiatives such as debt alleviation for Heavily
the AfDB by their Minister of Finance, Planning Indebted Poor Countries and the New
or Cooperation who sits on the AfDB Board of Partnership for Africa's
Governors. Development (NEPAD).
▪ It is to be noted that Cabo Verde and Libya are the
only two countries are without the beneficiary of India and AfDB
AfDB or ADF.
▪ India joined the African Development Fund in
1982, and became a member of the Bank in 1983.
Components ▪ India is a non-regional member of the Bank.
▪ India and Africa share a great relationship, and
The AfDB comprises three entities:
have great degree of commonalities in terms of a
1. The African Development Bank,
shared history, and current challenges.
2. The African Development Fund and
▪ In March 2018, the Bank and the International
3. The Nigeria Trust Fund.
Solar Alliance signed a joint declaration
committing to scale up the partnership on
Functions renewable energy for Africa’s development needs,
such as the Bank’s transformative Desert to Power
▪ AfDB is making loans and equity investments for initiative in Africa’s Sahel and Sahara, which
the socio-economic advancement of the RMC. envisages 10 GW of solar power generation and
▪ The bank provides technical assistance for providing clean energy access to 90 million
development projects and programs. people.
▪ It promotes investment of public and private ▪ In addition to trade, India has undertaken
capital for development. significant investment initiatives in recent years to
▪ The bank assists in organizing the development strengthen its strategic partnership with Africa,
policies of RMCs. and has become one of the largest investors,
mainly in energy, construction, ICT, and the
railway and auto industries.

247
 CH-19 ORGANIZATION OF ISLAMIC COOPERATION (OIC)
▪ The Organization was established upon a decision
of the historical summit which took place in Rabat,
Basic and Backgrounds Kingdom of Morocco 25 September 1969 as a
result of criminal arson of Al-Aqsa Mosque in
▪ Organization of Islamic Cooperation is an occupied Jerusalem.
international organization founded in 1969,
consisting of 57 member states.
Priority Areas
▪ It is the second largest inter-governmental
organization after the United Nations. ▪ The priority areas include issues of Peace and
▪ The organization states that it is “the collective Security, Palestine and Al-Quds, Poverty
voice of the Muslim world” and works to Alleviation, Counter-terrorism, Investment and
“safeguard and protect the interests of the Muslim
Finance, Food Security, Science and
world in the spirit of promoting international peace
and harmony“. Technology, Climate Change and
▪ The OIC has permanent delegations to the Sustainability, Moderation, Culture and
United Nations and the European Union. Interfaith Harmony, Empowerment of Women,
▪ Permanent Secretariat is in Jeddah, Saudi Joint Islamic Humanitarian Action, Human
Arabia. Rights and Good Governance, among others.
▪ Like NAM again, the OIC is a toothless tiger
when it comes to dealing with squabbles among Bodies of OIC
member states.
▪ Among the OIC’s key bodies: the Islamic Summit,
the Council of Foreign Ministers (CFM), the
Membership
General Secretariat, in addition to the Al-Quds
Committee and three permanent committees
concerned with science and technology, economy
and trade, and information and culture.
▪ There are also specialized organs under the banner
of the OIC including the Islamic Development
Bank and the Islamic Educational, Scientific and
Cultural Organization, as well as subsidiary and
affiliate organs that play a vital role in boosting
cooperation in various fields among the OIC
member states.

India and Islamic World

▪ In the last few years, India has improved ties with
▪ It is the second largest inter-governmental the Islamic world from Saudi Arabia to Indonesia,
organization after the United Nations with a while building on good relations with countries
membership of 57 states. like Qatar and Oman.
▪ Of these, 47 are Muslim Majority countries. ▪ While it was Bangladesh that floated the idea of
▪ Bosnia and Herzegovina; Central African India becoming an observer at the OIC in 2018,
Republic; Thailand; Russia and Turkish Cypriot the UAE invite offered India an opportunity to
State are the observer country. address the forum.
▪ The Crown Prince of Abu Dhabi, Sheikh
Objective Mohammed bin Zayed Al Nahyan (MBZ), was a
very special Chief Guest at the 68th Republic Day
▪ The main motive of the organisation is to the celebrations in 2017, the first time that India laid
safeguard and protect the interests of the Muslim out the Republic Day red carpet for a leader who
world in the spirit of promoting international peace was neither a Head of State nor Head of
and harmony among various people of the world. Government.

248
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▪ The Crown Prince MBZ had earlier visited India in ▪ India was invited to attend the first summit of the
February 2016, following a visit by Prime Minister OIC 50 years ago in 1969 in Morocco. But the Indian
Narendra Modi to the UAE in August 2015. delegation had to return midway due to a withdrawal
▪ Recently, Crown Prince of Saudi Arabia, of the invitation after Pakistan’s objection.
Mohammed bin Salman visited India. ▪ In 2002, it was Qatar that first proposed observer
status for India at the OIC foreign ministers’ meet
OIC's stance on J&K but Pakistan had consistently blocked the move.
▪ In 2018, Bangladesh along with Turkey proposed
▪ The OIC has been generally supportive of restructuring of the charter of the Organisation of
Pakistan’s stand on Kashmir. Islamic Cooperation to pave way for the inclusion
▪ It has earlier even issued statements criticising the of non-Muslim countries like India as an 'observer
alleged Indian “atrocities” in the state. state'.
▪ The 2017 session of Council of OIC Foreign ▪ For the first time in five decades, the United Arab
Ministers had adopted a resolution reaffirming the Emirates invited foreign minister of India Sushma
unwavering support for the Kashmiri people in Swaraj to attend the inaugural plenary 46th
their just cause. meeting of OIC foreign ministers. (Pakistan
▪ Recently in December 2018 too, the OIC boycotted the meet)
expressed strong condemnation of the killing of ▪ From the mid-1990s, when this Contact Group was
innocent Kashmiris by Indian forces in Indian- formed, it has issued several statements on behalf
occupied Kashmir. of Pakistan (on Kashmir issue)
▪ It called upon the international community to play ▪ The United Arab Emirates, for instance, conferred
its role in order to reach a just and lasting solution the “Order of Zayed”, its highest civilian award
to the conflict in Kashmir. on Prime Minister Narendra Modi, more than a
week after New Delhi’s moves on Article 370, and
46th Session of CFM of OIC declared that Kashmir was India’s internal matter.

▪ Theme of the meet: “50 years of Islamic Significance of this invitation

cooperation: The road map for prosperity and
development,". ▪ This is the first-time invitation to India to be a
▪ External Affairs Minister Sushma Swaraj was Guest of Honour at the Plenary of the OIC.
invited to deliver an address at the 46th Session ▪ At the 45th session of the Foreign Ministers’
of Organisation of Islamic Cooperation (OIC) Summit in 2018, host country Bangladesh noted
Council of Foreign Ministers (CFM) summit, that India had more than 10% of the world’s
held in Abu Dhabi on 1-2 March. Muslims live.
▪ It adopted the “Abu Dhabi declaration”. ▪ Bangladesh thus proposed that India be given
the Observer status, but Pakistan opposed the
Abu Dhabi declaration proposal.
▪ So the present invite is a welcome recognition of
▪ It was named “Document on Human Fraternity the presence of 185 million Muslims in India and
for World Peace and Living Together” and it of their contribution to its pluralistic ethos.
seeks to encourage stronger relationships between ▪ Especially, it comes at the time of heightened
people to promote coexistence among peoples and tensions with Pakistan following the Pulwama
to confront extremism and its negative Impacts. terrorist attack.
▪ The OIC refrained from giving in to Pakistan's ▪ Hence, it is seen as a significant diplomatic
demands to include Kashmir issue in the final victory for New Delhi.
declaration. ▪ It also signals India's improved ties with both
Saudi and the UAE, and the Gulf region as a
whole.
India – OIC Relation
▪ It indicates their desire to go beyond the bilateral
▪ India’s relationship with Pakistan has always been ties and forge a true multifaceted partnership at
tense and has a direct impact on India-OIC the multilateral and international level.
relations, with Pakistan being a founding member
of the OIC. India has pushed for the OIC to accept Arguments in favour of India’s membership at
India as a member, Pakistan opposes India’s entry the OIC
into the OIC.

249
▪ Second largest Muslim Community: Though embarrass India by raising the J&K dispute in the
India is neither a part of the Muslim world nor a OIC even if India had Observer status.
Muslim majority state in statistical terms, yet it ▪ India has good reason to be pleased that Pakistan
host the second largest community of Muslims in can no longer veto India’s engagement with
the world. Countries like Thailand and Russia are critical states of the Middle East.
observer members, despite having a significant ▪ For the emerging forces of political moderation
minority Muslim population. and social modernisation in the Middle East, India
▪ West Asian Diaspora: There are also some eight is a more attractive partner than Pakistan.
million Indians in West Asia, who contribute to ▪ Therefore, in the given circumstances, the best
these economies as well as cultural richness. option would be for India to continue to work
▪ Co-operation in Strategic and economic with individual members of the OIC to establish
matters: Apart from a large diaspora, India is the friendly relations and deepen bilateral cooperation,
third largest economy in the world and one of the and work to negate the designs of Pakistan
biggest importers of hydrocarbons like gas and oil. within the OIC ranks.
West Asia and `India’s growing economic and
energy interdependence makes it difficult for the
former to ignore the latter.
▪ Countering Pakistan: India’s deepening ties with
Islamic world could act as a bulwark to prevent
Pakistan from using the secretariat and OIC forum
for its own propaganda.

Challenges faced by India in OIC:

▪ OIC’s stance on Jammu and Kashmir: It has
been generally supportive of Pakistan’s concerns
over Jammu and Kashmir. With regards to this, the
OIC has been issuing statements criticizing alleged
atrocities and human rights violations in the state.
▪ Presence of Pakistan: Pakistan has always
objected India’s entry into the group, stating that
any country wishing to get observer status should
not be involved in any dispute with an OIC
member state.
▪ Position on Israel: OIC condemns any arbitrary
steps by Israel which undermine the international
efforts to reach the two-states solution and achieve
peace. Though traditionally, India has been a
supporter of the two-State solution, its deepening
relation with Israel can be a challenge.

Way Forward
▪ For India to become a full member, special
concession has to be invoked as in the case of
other Muslim minority states that became OIC
members.
▪ However, given the current state of relations
between India and Pakistan and the sensitivities
of managing their own domestic public opinion,
OIC members are unlikely to offer India full
membership.
▪ On the other hand, Observer status does not entail
voting rights, and Pakistan will continue to

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 CH-20 SOUTH ASIA CO-OPERATIVE ENVIRONMENT
PROGRAMME (SACEP)

Basics and Backgrounds ▪ Integration of environment and development as

essential prerequisites to Sustainable
Development, and
▪ Importance of co-operative action in the South
Asian region where many ecological and
development problems transcend national and
administrative boundaries.

Governing Structure

▪ The Colombo Declaration and the Articles of

Association of SACEP constitute the legal base
for SACEP.
▪ The principal organs of the Governance
Structure of SACEP are the Governing Council
▪ South Asia Co-operative Environment Programme (GC), Consultative Committee (CC) and the
(SACEP) is an intergovernmental organization. SACEP Secretariat.
It is headquartered in Colombo, Sri Lanka. ▪ The GC is the principal review and deliberative
▪ It was established in 1982 by the governments of body of SACEP and is responsible for determining
South Asia to promote and support protection, its policy and programmes.
management and enhancement of the environment ▪ It consists of one representative from each
in the region. member state who will be of Ministerial portfolio
▪ The members of SACEP includes Afghanistan, and as per Articles of Association, should meet
Bangladesh, Bhutan, India, Maldives, Nepal, annually.
Pakistan and Sri Lanka. ▪ Since becoming a legal entity in 1982, up to date
▪ SACEP also acts as the Secretariat for the South Twelve GC meetings and Three Special Sessions
Asian Seas Programme which comes under the of the GC had been held.
purview of UNEP’s Regional Seas Programme. ▪ The Consultative Committee is responsible for
▪ Since its creation, SACEP has implemented a facilitating implementation of Policies, Strategies
number of projects and programmes in the areas of and Programme/Projects determined by the GC
environment education, environment and it consists of representatives of the Diplomatic
legislation, biodiversity, air pollution, and the Missions of member countries residing in
protection and management of the coastal Colombo.
environment. SACEP is also secretariat for the ▪ The Secretariat consists of the Director General
South Asian Seas Programme. and professional, administrative and supporting
▪ The Malé Declaration on control and prevention staff. The secretariat is based in Colombo, Sri
of air pollution and its likely trans boundary Lanka and is under the patronage of the Sri
effects for South Asia is another significant efforts Lankan Government.
which encourages intergovernmental cooperation
to combat the trans boundary air pollution problem Vision

Objectives ▪ Recognition of environmental degradation caused

by factors like poverty, over population, over
consumption and wasteful production threatening
▪ Recognition of environmental degradation caused economic development and human survival,
by factors like poverty, overpopulation, over ▪ Integration of environment and development as
consumption and wasteful production threatening essential prerequisites to Sustainable
economic development and human survival, Development, and

251
▪ Importance of co-operative action in the South the region accounted for over 60 percent of
Asian region where many ecological and disaster-related deaths worldwide.
development problems transcend national and
administrative boundaries. India and SACEP

Mission ▪ Recently the Union Cabinet chaired by Prime

Minister has approved signing of a MoU between
▪ To promote regional co-operation in South Asia in India and SACEP for cooperation on the response
the field of environment, both natural and human to Oil and Chemical Pollution in the South Asian
in the context of sustainable development and on Seas Region.
issues of economic and social development which ▪ The MoU intends to promote closer cooperation
also impinge on the environment and vice versa between India and other maritime nations
▪ To support conservation and management of comprising the South Asian seas region namely,
natural resources of the region Bangladesh, Maldives, Pakistan, Pakistan and Sri
▪ To work closely with all national, regional, and Lanka for protection and preservation of marine
international institutions, governmental and non- environment in the region.
governmental, as well as experts and groups
engaged in such co-operation and conservation 15th SACEP Meeting
efforts.
▪ The Union Minister for Environment, Forest and
Salient Features of South Asia climate change & Information and Broadcasting
(I&B), Prakash Javadekar, has participated in
▪ The region covers almost one twentieth of the the 15th governing council meeting (GCM) of
earth’s surface and provides a home for about one the South Asia Cooperative Environment
fifth of the world population. Programme 2019 (SACEP) in
▪ The degree of urbanization in 1999 ranged from 7 Dhaka, Bangladesh.
percent in Bhutan to 33 percent in Pakistan. ▪ The meet with the SACEP member countries
Mumbai, Calcutta, Delhi, Karachi and Dhaka are witnessed the issues of plastic waste
fast growing cities with population more than 10 management, biodiversity and other issues
million. related to the environment were discussed
▪ Over 30 percent of the population earns less than among South Asian Member countries.
one dollar per day and the per capita GNP for 1998
ranged from US$ 210 to 130. It is US$ 210 in
Nepal to 1,130 in Maldives.
▪ Although the economies of the countries are
primarily agricultural, industrialization has
increased during the past decade.
▪ South Asia is home to 14 percent of the world’s
remaining mangrove forests and the Sundarbans
found between Bangladesh and India is one of the
largest continuous mangrove stretch in the world .
▪ 6 percent of the world’s coral reefs are in the
South Asian seas. The atolls of Maldives and
Lakshadweep islands of the region, are
biodiversity rich marine habitats.
▪ Hindu Kush Himalayan belt is home to over
25,000 major plant species, comprising 10 percent
of the world’s flora.
▪ The region is prone to natural disasters such as
cyclones, floods and landslides. From 1990-1999,

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 CH-21 INDIA-BRAZIL-SOUTH AFRICA (IBSA)
Basics and Backgrounds ▪ At the highest level, it counts on the Summits of
Heads of State and Government.

IBSA Summits

▪ 1st: In New Delhi (2004)

▪ 2nd: In Cape Town (2005)
▪ 3rd: In Rio de Janeiro (2006)
▪ 4th: In New Delhi (2007)
▪ 5th: In Somerset West (2008)
▪ 6th: In Brasília (2009)
▪ 7th: In New Delhi (2011)
▪ 8th: In Durban (2017)
▪ IBSA is a unique Forum which was formalised by ▪ 9th: In New York (2018)
the Brasilia Declaration of 6 June 2003 and brings
together India, Brazil and South Africa, three large Initiatives of IBSA
democracies and major economies from three
different continents, facing similar challenges. ▪ IBSA fund has formed various developing projects
▪ All three partners are developing, pluralistic, in the needy countries like- Vietnam, Cambodia,
multi-cultural, multi-ethnic, multi-lingual and Burundi and so on.
multi-religious nations. ▪ The external ministries of the three countries are
▪ Established in June 2003, IBSA is a coordinating actively supporting each other for a coordinated
mechanism amongst three emerging countries, grouping.
three multi ethnic and multicultural democracies. ▪ India has been coordinating IBSA Visiting Fellows
Programme through the Delhi-based Research and
Objective Information System for Developing Countries.

▪ Contribute to the construction of a new Cooperation of IBSA Countries

international architecture
▪ Bring their voice together on global issues ▪ Political Coordination
▪ Deepen their ties in various areas ▪ Sector Cooperation, through 14 Working Groups
▪ IBSA also opens itself to concrete projects of ▪ IBSA Facility for Poverty and Hunger Alleviation
cooperation and partnership with less developed (IBSA Fund)
countries. ▪ People-to-People fora (Involvement of other actors
beyond the Executive, e.g. civil society)
Principles
IBSA’s Declaration on South South
▪ The principles, norms and values underpinning the Cooperation
IBSA Dialogue Forum are participatory
democracy, respect for human rights and the Rule ▪ SSC as a common endeavour of peoples and
of Law. countries of the South. It notes the shared
▪ The strength of IBSA is the shared vision of the histories, understanding and beliefs and
three countries that democracy and development developmental experiences of global south.
are mutually reinforcing and key to sustainable ▪ Developing Countries as developing Partners:
peace and stability. Developing countries engaged in SSC are not
donors and recipients but developing partners.
Structure ▪ Solidarity and the spirit of sharing are the
primary motivations for SSC.
▪ IBSA keeps an open and flexible structure. ▪ Voluntary in nature: SSC is voluntary in nature
▪ IBSA does not have a headquarters or a permanent and not obligatory like Official Development
executive secretariat. Assistance (ODA).

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▪ Demand driven process: Partner countries IBSA Mechanism for Development
determine the priorities in the SSC projects. Cooperation – IBSA Fund for the Alleviation
Primary responsibility towards development rests of Poverty and Hunger
with the States themselves under their ownership
and leadership.
▪ It was set up with the objective of facilitating the
▪ Respect for national sovereignty is at the core of
execution of human development projects to
SSC. It is guided by principles of respect for
advance the fight against poverty and hunger in
national sovereignty; national ownership and
developing countries.
independence; equality; non-conditionality; non-
▪ Each member country contributes $1 Million
interference in domestic affairs; and mutual
annually to this fund.
benefit.
▪ The IBSA Fund is managed by the United Nations
▪ Complements North-South Cooperation: South-
Office for South-South Cooperation (UNOSSC).
South Cooperation serves as a complement to and
▪ With a cumulative contribution of $35mn, IBSA
not as a substitute for North-South cooperation, in
Fund has thus far partnered 19 countries from the
supporting the acceleration of the development
Global South for implementing 26 projects over
agenda. It calls upon the global North to honour its
the last decade. 62.4 percent of the IBSA Fund has
ODA commitments fully, scale up existing
been devoted to Least Developed Countries
resources and commit additional resources to
(LDCs).
provide the necessary means to achieve the goals
of the Paris Agreement on Climate Change as well
as implementing SDGs. Relevance of IBSA vis-à-vis BRICS

INDIA-BRAZIL-SOUTH AFRICA (IBSA) ▪ Although IBSA’s visibility in international affairs

Dialogue Forum pales against that of the yearly BRICS Summits,
the three IBSA members have identified
themselves as partners because they share a set of
fundamental notions about global order.
▪ All three IBSA members are multiparty
democracies and are thus able to freely debate
how to implement difficult reforms necessary to
boost growth in a messy and complex political
context. These matters cannot be discussed openly
at BRICS Summits.
▪ In the same way, issues related to human rights
and civil society are not mentioned when the
BRICS meet. During the 2011 IBSA Summit, the
Brazilian President succeeded in including the
“Responsibility While Protecting” (a concept
that seeks to qualify and refine the “Responsibility
to Protect” concept) into the final declaration,
something which it promptly failed to do several
months later at the 4th BRICS Summit due to
Chinese and Russian opposition.
▪ As emerging countries that are not yet fully
▪ IBSA Dialogue Forum is an international tripartite
integrated in today’s international structures, they
grouping for promoting international cooperation
all consider current structures to be unjust and
of India, Brazil and South Africa.
in need of reform. While the degree of rejection of
▪ IBSA was formally established by the Brasilia
some institutions differs – for example, India is far
Declaration of 6 June 2003 by external affairs
more hostile towards the Non-Proliferation Treaty
ministers of India, Brazil and South Africa.
(NPT) than Brazil – all three agree that they
▪ It represents three important poles for galvanizing
deserve more institutional responsibility, including
South-South cooperation and greater
permanent seats on the UN Security Council.
understanding between three important continents
▪ IBSA provides an intimate setting undisturbed
of the developing world namely, Africa, Asia and
by at times strained bilateral ties – after all,
South America, facing similar challenges.
relations between India, Brazil and South Africa

254
 are simply too incipient to hit any meaningful
roadblocks or clashes of interest.
Way Forward

▪ Strengthening IBSA is a positive step for the BRICS perspective also.

▪ It will then strengthen the voice of BRICS in other international institutions and forums.
▪ As IBSA’s main aims are-to contribute to the construction of a new international architecture, bring their voice
together in the world and to deepen their ties in various areas; IBSA has definitely its unique importance in global
south.

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 CH-22 GULF COOPERATION COUNCIL (GCC)

Basics and Backgrounds

Supreme Council

Ministerial Council

Secretariat General

Monetary Council

Patent Office
Peninsular Shield
Force

▪ The GCC consists of the Supreme Council, the

Ministerial Council, the Cooperation Council,
the General-Secretariat, and various
Committees on economic, social, industrial, and
trade and political affairs.
▪ The Kuwait government formulated a proposal for ▪ The highest authority is the Supreme Council,
an organisation to link the six Arabian Gulf States consisting of heads of the member-states. It meets
which have special cultural and historical ties. annually and determines the policies of the
▪ Accordingly, the Riyadh Agreement was issued organisation.
which proposed cooperative efforts in cultural, ▪ The Ministerial Council comprises foreign
social, economic, and financial affairs. ministers of the member-states.
▪ A Constitution was initiated in March 1981 and ▪ It meets every three months to prepare for the
was signed by the Gulf Heads of State (Bahrain, meetings of the Supreme Council and draw up
Kuwait, Oman, Qatar, Saudi Arabia, and the UAE) policies, recommendations, studies, and
on May 25-26, 1981 at Abu Dhabi, the UAE. projects aimed at developing cooperation and
Consequently, the Gulf Cooperation Council coordination among member-states.
(GCC) came into existence. ▪ The Cooperation Council has a commission, the
▪ The GCC is a political and economic alliance of Commission for the Settlement of Disputes,
countries in the Arabian Peninsula. which is attached to the Supreme Council.
▪ It was established in 1981 to foster socioeconomic, ▪ The Secretariat is headed by the Secretary-
security, and cultural cooperation. General, appointed by the Supreme Council for a
▪ Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and renewable three-year term.
the UAE are its members. ▪ The Secretariat, consisting of several specialized
▪ They gather every year to discuss cooperation and sectors, implements the recommendations given
regional affairs. by the Supreme Council and the Ministerial
▪ All current member states are monarchies, Council.
including three constitutional
monarchies (Qatar, Kuwait, and Peninsula Shield Force
Bahrain), two absolute monarchies (Saudi
Arabia and Oman), and one federal ▪ The Peninsula Shield Force (Peninsula Shield) is
monarchy (the United Arab Emirates). the military arm of the Gulf Cooperation
Council (GCC).
The Structure ▪ It is intended to deter, and respond to, military
aggression against any of the GCC member
countries: Bahrain, Kuwait, Oman, Saudi
Arabia, Qatar, and the United Arab Emirates.

256
Objectives of GCC ▪ The letter also mentioned Iran’s shoot down of a
Ukrainian passenger plane and its navy
▪ To achieve coordination, integration, and accidentally killing 19 sailors in a missile strike
cooperation among the member-states in all fields during an exercise.
to bring about their unity ▪ Iran also is suspected of launching an attack on
▪ To deepen and strengthen the bonds of Saudi Arabia’s oil industry in September 2019.
cooperation existing among their peoples in all ▪ Iran has denied the various accusations of its
fields involvement in arms supply.
▪ To draw up similar systems in all fields ▪ Iran has condemned the GCC letter and called it
▪ To promote scientific and technical progress in an irresponsible statement that serves the USA’s
the fields of industry, minerals, agriculture, sea interests.
wealth and animal wealth for the good of the ▪ It has also criticized the GCC countries for
peoples of the member-states. being “among the largest arms buyers in the
region and the world,” even amidst the economic
downturn caused by the Covid 19 pandemic.
Gulf Union Proposals
Qatar Crisis
▪ A proposal in 2011 to transform the GCC into a
"Gulf Union" with tighter economic, political
▪ Qatar crisis, which saw Bahrain, Egypt, Saudi
and military coordination was advanced by
Arabia and the Emirates cut diplomatic ties
Saudi Arabia, a move meant to counterbalance with Qatar and launch a boycott of the nation
the Iranian influence in the region. beginning in 2017.
▪ Objections were raised against the proposal by ▪ Qatar has had good relations with Iran and has
other countries. used its airspace while sharing a vast offshore oil
and gas field with Tehran (Iran’s capital).
The Gulf is widening between GCC Countries ▪ Qatar is home to the massive Al-Udeid Air Base
and the forward headquarters of the USA
▪ Oman continues to keep ties open with Qatar and
military’s Central Command.
Iran. The blockade made Qatar more independent
in foreign policy decisions.
▪ The cold-blooded murder of Jamal Khashoggi India’s priorities in the Gulf
created ripples. The blockade last year triggered
tensions among the GCC countries.
▪ Qatar also strengthened its alliance with Turkey,
which stepped in as provider of security for Doha.
▪ And Turkey checkmated any plans that Saudis and
Investment Energy Security
Emiratis might have had to use force to bring the
Qatari emir down on his knees.
▪ Saudi Arabia is upset that Oman and Kuwait did
not join the embargo. Kuwait is in fact trying to Extended
Trade
mediate. Neighbourhood
▪ Qatar stepped up assistance for Hamas in Gaza
strip. It accelerated a plan to allow Turkey to set
up military camp in the country.
▪ Qatar also resisted calls to cut ties with Iran. ▪ The Gulf is an integral part of India’s ‘extended
neighbourhood’, both by way of geographical
GCC and Iran proximity and as an area of expanded interests and
growing Indian influence.
▪ The UN, the USA and other armament experts ▪ Securing long term energy supply is of primary
have accused Iran of providing arms to Yemen’s importance for India in the region.
Houthi rebels. ▪ India is currently the fourth largest energy
▪ Iran allegedly arms Hezbollah fighters in consuming country in the world and it may go up
Lebanon and Syria and also provides weapons to to third position in next couple of decades.
Shiite militias in Iraq and terrorist groups in ▪ India’s annual GDP growth at the rate of eight
Bahrain, Kuwait and Saudi Arabia. per cent would require further industrial growth

257
 which would demand more energy supply for the
country. Strategic relations
▪ The growing energy necessity has undoubtedly ▪ From the strategic point of view, India and GCC
dictated India’s initiative of building up a share the desire for political stability and security
‘strategic energy partnership’ with the region to in the region. The common political and security
secure long-term energy supply for the country. concerns of India and GCC translate into efforts
▪ The Gulf countries look at India as a fast growing for peace, security and stability in the Gulf region
economy which holds the potential to compete and South Asia.
with the major world economies. ▪ The emerging common security perceptions create
further opportunities for GCC-India cooperation in
▪ Realising the trade potential of the Gulf countries, the future. The GCC States are going through
India has entered into a negotiation with the GCC important changes and transformation; the process
to finalise a Free Trade Agreement. of understanding and integration is coming of age.
▪ The Gulf countries have huge potential ▪ Along with it the areas for cooperation are also
for investing in different sectors in India as FDI widening beyond investments, trade & commerce
for mutual benefit. and sharing & development of human resources to
security.
India’s relations with GCC region:
India-GCC Industrial Conference
▪ The Gulf Cooperation Council (GCC) as a ▪ The first GCC-India Industrial Conference was
collective entity has tremendous significance for held in Mumbai in February 2004, the second was
India. The Gulf constitutes the “immediate” held in Muscat in March 2006, the third was held
neighbourhood of India separated only by the in Mumbai in May 2007 and the fourth was held at
Arabian Sea. India, therefore, has a vital stake in King Abdullah Economic City, Jeddah in
the stability, security and economic well-being of November 2015.
the Gulf.
▪ As a group, the GCC has been increasingly India-GCC FTA
determining the economy, political and security ▪ India and GCC signed a Framework Agreement
policies of its member States. The GCC countries for enhancing and developing economic
are moving ahead rapidly with their economic cooperation between the two sides in in New Delhi
integration efforts. in August 2004. Two rounds of talks for finalizing
▪ The GCC has emerged as a major trading partner aspects like tariff rules, rules of origin, etc. have
of India. It has vast potential as India’s investment been held. The India-GCC FTA is under
partner for the future. negotiation.
▪ The GCC’s substantial oil and gas reserves are of
utmost importance for India’s energy needs. The
Way Forward
GCC countries are collectively host to a large
Indian expatriate community.
▪ India has acquired a large and rewarding
▪ In short, the GCC offers tremendous potential for
cooperation in trade, investment, energy, regional footprint, particularly as the preferred
source of manpower, food products,
manpower, etc.
pharmaceuticals, gem and jewellery, light
engineering items, etc.
Economic and Commercial Relations:
▪ Indians are also the biggest stakeholders in
Dubai’s real estate, tourism and Free Economic
Zones.
▪ India enjoys traditionally cordial relations and
▪ In the evolving scenario, there may be scope for a
cooperation with the GCC. India’s old, historical
profitable trilateral synergy, but India cannot take
ties with GCC States, coupled with increasing
its preponderance as a given.
imports of oil and gas, growing trade and
investment, and presence of approximately 6.5
million Indian workers in the region, are of vital
interest to India.
▪ During 2015-16, India’s exports to GCC were US
$ 41.71 billion. The bilateral two-way trade during
the period was US$ 97.46 billion, registering a
decline of about 27% over the previous year.

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 CH-23 EUROPEAN UNION
Basics and Backgrounds ▪ Combat social exclusion and discrimination
▪ Promote scientific and technological progress
▪ Enhance economic, social and territorial cohesion
and solidarity among EU countries
▪ Respect its rich cultural and linguistic diversity
▪ Establish an economic and monetary union whose
currency is euro.

Values
▪ The EU values are common to the EU countries in
a society in which inclusion, tolerance, justice,
solidarity and non-discrimination prevail.
▪ These values are an integral part of our European
way of life:

Human
Dignity

Human Freedom
Rights
▪ The European Union is a group of 28 countries
that operate as a cohesive economic and political
Value
block.
▪ 19 of these countries use EURO as their official
Rule of Democrac
currency. 9 EU members (Bulgaria, Croatia, Law y
Czech Republic, Denmark, Hungary, Poland,
Romania, Sweden, and the United Kingdom) do Equality
not use the euro.
▪ The EU grew out of a desire to form a single
European political entity to end centuries of
warfare among European countries that culminated History
with World War II and decimated much of the
continent. ▪ After World War II, European integration was
▪ The EU has developed an internal single seen as a cure to the excessive nationalism which
market through a standardized system of laws that had devastated the continent.
apply in all member states in matters, where ▪ In 1946 at the University of Zurich,
members have agreed to act as one. Switzerland, Winston Churchill went further and
▪ In 2012, the EU was awarded the Nobel Peace advocated the emergence of a United States of
Prize for advancing the causes of peace, Europe.
reconciliation, democracy and human rights in ▪ In 1952, European Coal and Steel Community
Europe. (ECSC) was founded under Treaty of Paris
(1951) by 6 countries called Six (Belgium, France,
Goals Germany, Italy, Luxembourg and the Netherlands)
to renounce part of their sovereignty by placing
▪ Promote peace, values and the well-being of all their coal and steel production in a common
citizens of EU. market, under it.
▪ Offer freedom, security and justice without ▪ European Court of Justice (called "Court of
internal borders Justice of the European Communities" until 2009)
▪ Sustainable development based on balanced was also established in 1952 under Paris Treaty.
economic growth and price stability, a highly ▪ European Atomic Energy Community (EAEC
competitive market economy with full or Euratom) is an international organisation
employment and social progress, and established by the Euratom Treaty (1957) with
environmental protection the original purpose of creating a specialist market

259
 for nuclear power in Europe, by developing the European Council and the President of the
nuclear energy and distributing it to its member European Commission.
states while selling the surplus to non-member ▪ The High Representative of the Union for Foreign
states. Affairs and Security Policy also takes part in its
▪ European Economic Community (EEC) was meetings.
created by the Treaty of Rome (1957). The ▪ Established as an informal summit in 1975, the
Community's initial aim was to bring about European Council was formalised as an institution
economic integration, including a common market in 2009 upon the entry into force of the Treaty of
and customs union, among its founding members Lisbon.
(Six). ▪ The decisions of its summits are adopted by
▪ It ceased to exist by Lisbon Treaty-2007 and its consensus.
activities were incorporated in EU.
▪ Merger Treaty (1965, Brussels) in which an European Parliament
agreement was reached to merge the three
communities (ECSC, EAEC, and EEC) under a ▪ It is the only parliamentary institution of the
single set of institutions, creating the European European Union (EU) that is directly elected by
Communities (ECs). EU citizens aged 18 years or older.
▪ Schengen Agreement (1985) paved the way for ▪ Together with the Council of the European
the creation of open borders without passport Union (also known as the 'Council'), it exercises
controls between most member states. It was the legislative function of the EU.
effective in 1995.
▪ Single European Act (1986): enacted by the Council of the European Union
European Community that committed its member
▪ It is part of the essentially bicameral EU
countries to a timetable for their economic merger
and the establishment of a single European legislature (the other legislative body being the
currency and common foreign and domestic European Parliament) and represents the
policies. executive governments (Minister) of the EU's
▪ The Maastricht Treaty-1992 (also called member states.
the Treaty on European Union) was signed on 7
February 1992 by the members of the European European Commission (EC)
Community in Maastricht, Netherlands to further ▪ It is an executive body of the European
European integration. It received a great push Union, responsible for proposing legislation,
with the end of the Cold War. implementing decisions, upholding the EU treaties
and managing the day-to-day business of the EU.
Euro Crisis
European Court of Auditors (ECA)
▪ The EU and the European Central Bank
(ECB) have struggled with high sovereign debt ▪ It investigates the proper management of finances
and collapsing growth in Portugal, Ireland, Greece within both the EU entities and EU funding
and Spain since the global financial market provided to its member states.
collapse of 2008.
The Court of Justice of the European Union
▪ Greece and Ireland received financial bailouts
(CJEU)
from the community in 2009, which were
accompanied by fiscal austerity. Portugal followed ▪ It interprets EU law to make sure it is applied in
in 2011, along with a second Greek bailout. the same way in all EU countries, and settles legal
disputes between national governments and EU
Governance
institutions.
European Council The European Central Bank (ECB)

▪ It is a collective body that defines the European ▪ It is the central bank for the euro and administers
Union's overall political direction and priorities. monetary policy within the Euro zone, which
▪ It comprises of the heads of state or government of comprises 19 member states of the European
the EU member states, along with the President of Union.

260
Functions contemporaneous occurrence of two shocks, the
economic and the migration crises.
▪ EU’s law and regulation is meant to create a ▪ USA, by withdrawing from the Paris climate
cohesive economic entity of its countries, so change deal, by pulling out of the Joint
that goods can flow freely across the borders of Comprehensive Plan of Action (JCPOA) on Iran’s
its member nations, without tariffs, with the ease
nuclear programme, and by attacking the integrity
of one currency, and the creation of one enlarged
labour pool, which creates a more efficient of the international trading system through the
distribution and use of labour. unilateral imposition of tariffs, has called into
▪ There is a pooling of financial resources, so that question Europeans’ formerly unshakeable faith in
member nations can be "bailed out" or lent money diplomacy as a way to resolve disagreements and
for investment. to protect Europe.
▪ Union's expectations in areas such as human ▪ European leaders now fear that the transatlantic
rights and the environment have political security guarantee will centre not on alliances and
implications for member countries. Union can common interests but purchases of American
exact a heavy political cost such as severe technology and materiel.
cutbacks and an austerity budget on its members as ▪ Like the United States, the EU has been forced to
a condition of giving aid. reconsider its relationship with a more assertive
▪ This is a great experiment, really, in cooperation Russia with implications for European security and
amongst nations, who wish to be economically
stability. The EU has sought to support Ukraine's
unified, ceding as little political and national
power as possible. political transition, condemned Russia's
annexation of Crimea in March 2014, and strongly
Challenges & Reforms urged Russia to stop backing separatist forces in
eastern Ukraine.
▪ It is no longer self-evident that all old member
states will stay in the Union. The Treaty of Lisbon Brexit
gave the members the right to leave the EU. The ▪ EU has imposed too many rules on business and
financial crisis has hit Greece so hard that many charged billions of pounds a year in membership
people have predicted for a long time that the fees for little in return.
country will exit from the Union. ▪ The EU added eight eastern European countries in
▪ Layoffs, redundancies and migration of jobs to 2004, triggering a wave of immigration that
countries where labour is cheap affect the daily strained public services.
lives of European citizens. The EU is expected to ▪ In England and Wales, the share of foreign-born
find solutions to economic problems and residents had swelled to 13.4 percent of the
employment. population by 2011, roughly double the level in
▪ There is also demand for standard labour 1991.
agreements on terms of employment and working
conditions that would apply across Europe and
even worldwide. As a member of the World Trade
Organisation, the European Union is in a position
to influence developments worldwide.
▪ EU is a global leader in the development of Key
Enabling Technologies (KETs). However, EU’s
record in translating this knowledge advantage into
marketable products and services doesn't match
this. KETs-related manufacturing is decreasing in
the EU and patents are increasingly being
exploited outside the EU.
▪ Europe is experiencing a renaissance of national
sovereignty supported by a nationalistic turn of
public opinion and represented by parties on both
ends of the political spectrum. Popular disaffection
toward EU membership is fuelled by the

261
▪ Brexit supporters wanted Britain to take back full 2004. Since the Lisbon summit in 2000 India and
control of its borders and reduce the number of EU holds regular summits.
people coming here to live and/or work. ▪ As India graduated from low to medium income
▪ They argued that the EU is morphing into a country (OECD 2014), the EU-India cooperation
super-state that increasingly impinges on national also evolved from a traditional financial
sovereignty. Britain has global clout without the assistance type towards a partnership with a
bloc, they said, and can negotiate better trade focus on common priorities.
treaties on its own. ▪ At the 2017 EU-India Summit, leaders reiterated
▪ Withdrawal from the EU is governed by Article their intention to strengthen cooperation on the
50 of the Treaty on European Union. implementation of the 2030 Agenda for
▪ A deal between UK & EU that gives it control Sustainable Development and agreed to explore
over immigration and also preferential access to the continuation of the EU-India Development
the EU’s tariff-free single market of 500 million Dialogue.
people (UK), the economic backbone of the ▪ The EU is India's largest trading partner,
world’s largest trading bloc is rejected by accounting for €85 billion (95 billion USD) worth
Germany & other EU leaders. of trade in goods in 2017 or 13.1% of total India
trade, ahead of China (11.4%) and the USA
(9.5%).
Brexit and India: ▪ EU is also the largest destination for Indian
exports and a key source of investment and
Easing of Bilateral Relations in terms of trade and technologies. Major EU exports to India include
commerce: India sees the British exit as an engineering goods, gems and jewellery and
opportunity to expand its trade and economic chemical and allied products. The primary EU
relations with the UK. This will pave a way for imports include textiles and clothing, chemical and
signing of bilateral free trade agreement between India allied products and engineering goods.
and UK on the lines of Model Bilateral Agreements. ▪ EU is the second largest investor in India. The
Brexit provides a fresh opportunity to India to EU's share in foreign investment inflows to India
strengthen its economic relationship with the UK has more than doubled from 8% to 18% in the last
through an India–UK trade and investment decade, making the EU the first foreign investor in
agreement. India.
UK and EU will compete for trading with India and ▪ EU foreign direct investment stocks in India
enter into long term relationships with increased amounted to €73 billion in 2016, which is
growth of trade. significant but way below EU foreign investment
Britain’s exit from the European Union might benefit stocks in China (€178 billion).
students and professionals from India as after Brexit. ▪ INDIA-EU Bilateral Trade and Investment
After Brexit, Indian professionals will be competing Agreement (BTIA): It is a Free Trade Agreement
on merit rather than on nationality, as the UK will no between India and EU, which was initiated in
longer have to favour EU nationals. 2007. Even after a decade of negotiations, India
Brexit and the uncertainty it produces would have and EU have failed to resolve certain issues
many adverse impacts on the Indian businesses in the which have led to a deadlock.
UK. UK’s exit would shut the direct access of these ▪ EU and India remain close partners in the G20 and
companies to the EU market. have developed a regular macroeconomic
dialogue to exchange experience on economic
EU & India policies and structural reforms.
➢ Energy Cooperation: EU - India Clean
▪ The EU works closely with India to promote Energy and Climate Partnership.
peace, create jobs, boost economic growth and ➢ Research and Development: India,
enhance sustainable development across the participates in international ITER fusion
country. project which aims to build and operate
▪ In 1962, India was the first developing country to an experimental facility to demonstrate the
establish diplomatic relations with European scientific viability of fusion as a future
community. sustainable energy source. India also
▪ EU-India Cooperation Agreement 1994 provides participates in research and innovation
the legal framework for EU-India relations. India funding programme 'Horizon 2020'
and the EU have been strategic partners since wherein individual scientists can receive
grants from the European Research

262
 Council (ERC) or the Marie Skłodowska- with Geographical
Curie Actions (MSCA) Indication
➢ Environment and Water: The EU and
India also cooperate closely on the Indian ▪ Trade imbalance: India accounts for only 1.9% of
Clean Ganga initiative and deal with other EU total trade in goods in 2019, well behind China
water-related challenges in coordinated (13.8%). Trade imbalance is expected to further
manner. increase with ratification of the European Union
➢ City to City Cooperation: There is city- Vietnam Free Trade Agreement (EVFTA) and
to-city cooperation between European the EU-Vietnam Investment Protection
and Indian cities such as Mumbai, Pune Agreement, which will make Indian exports less
and Chandigarh in a first phase and twelve competitive.
more cities involved in the current phase.
Now it is being formalized in an India-EU ▪ Human Rights concerns of EU: The European
Partnership for Smart and Sustainable Parliament was critical of both the Indian
urbanization, which will support the government’s decision to scrap Jammu and
Indian ‘Smart cities’ and 'AMRUT'
Kashmir’s special status in 2019 and the
initiatives to boost joint research and
innovation. Citizenship (Amendment) Act.
➢ ICT Cooperation: The EU and India aim ▪ Brexit: It is unclear how U.K.’s withdrawal from
to link the ‘Digital Single Market’ with EU will affect India’s relation with EU as whole.
the ‘Digital India’. Apart from these
"Start-up Europe India Network" ▪ India’s perception of EU: It views EU primarily
initiative and EU-India Cyber Security as a trade bloc, preferring bilateral partnerships
Dialogue deserves special mention. with Member States for all political and security
➢ Migration and mobility: The EU-India matters. This is evident from lack of substantive
Common Agenda on Migration and agreements on matters such as regional security
Mobility (CAMM) is a fundamental and connectivity.
cooperation agreement between India and
EU. The CAMM addresses four priority
areas in a balanced manner: Conclusion
1. Better organised regular migration and the
fostering of well-managed mobility; ▪ Evolution of EU has roots in looking for an
2. Prevention of irregular migration and integration of divided Europe because of excessive
trafficking in human beings; nationalism over a long period of time which also
3. Maximizing the development impact of witnessed two world wars.
migration and mobility; and ▪ It has played an important role in improving
4. The promotion of international protection. economic conditions and raising living standard of
people in weaker members of group.
▪ Concerns in relations
▪ Stalled EU-India BTIA: It is being negotiated
since 2007. Major reasons for deadlock:

EU’s demands India’s demands

Duty cuts in automobiles Ease norms on temporary
movement of skilled
workers
Strong intellectual Relaxation of Sanitary
property regime and Phytosanitary (SPS)
and Technical Barriers to
Trade (TBT) norms
Tax reduction on wines, Data secure’ status
spirits etc
Relaxation in India’s data
localisation norms
Protection to all its items

263
 CH-24 COMMONWEALTH OF NATIONS

Basics and Backgrounds

▪ The primary activities of the Commonwealth are
designed to create an atmosphere of economic
cooperation between member nations, as well as
the promotion of democracy and good governance
in them.
▪ The Commonwealth is not a political union of any
sort and does not allow the United Kingdom to
exercise any power over the affairs of the
organization’s other members.
▪ While some nations of the Commonwealth, known
as Commonwealth Realms, recognize the British
Monarch as their head of state (and thus in theory
still have some limited political ties to London),
the majority do not.
▪ The Commonwealth of Nations, at one time Commonwealth Heads of Government Meeting
known as British Commonwealth, is an
organisation of 54 states that were principally ▪ The main decision-making forum of the
below the colonial rule of British Government. organisation is the biennial Commonwealth
They came into existence with the proclamation of Heads of Government Meeting
sovereignty of the state from the colonial rule of (CHOGM), where Commonwealth heads of
British Empire and were later given self- government, including (amongst others) prime
governance. ministers and presidents, assemble for several days
▪ It was originally created as the British to discuss matters of mutual interest.
Commonwealth through the Balfour Declaration ▪ The Commonwealth Heads of Government
at the 1926 Imperial Conference and formalised by Meeting is a biennial summit meeting of the
the United Kingdom through the Statute of heads of government from all Commonwealth
Westminster in 1931. nations.
▪ It proclaims that the Commonwealth nations are
“free and equal”. The insignia of this
Commonwealth Association is Queen Elizabeth II
who is considered the Supreme of the Prosperity
Commonwealth nations.
▪ The member states of the commonwealth are not
legally liable or bound to each other. They are
rather united by language, history, culture, likeness
of the democracy, human rights and the rule of Sustaina Security
law. bility
▪ Their values are listed down within the
Commonwealth Charter and the hands of
harmony towards the member states are extended
by the Commonwealth Games held every four
Fairness
years.
▪ Former British mandates that did not become
members of the Commonwealth are Egypt,
Transjordan, Iraq, British Palestine, Sudan, London Meet of Commonwealth Heads of
British Somaliland, Oman, Kuwait, Bahrain, Government Meeting
Qatar, and the United Arab Emirates.

Structure

264
▪ London hosted the Commonwealth Heads of ▪ It emphasized fair ocean governance, more
Government Meet (CHOGM) with the theme prosperous maritime and marine industries,
“Towards a Common Future” for 2018. sustainable ocean use, and secure marine space
▪ The four main goals for the summit were: across the Commonwealth.

Commonwealth Cyber Declaration

▪ Prosperity: Boosting intra-Commonwealth trade
and investment. ▪ It is the world’s largest and most geographically
▪ Security: Increasing cooperation to deal with diverse intergovernmental commitment on cyber-
security challenges including global terrorism, security cooperation.
organized crime and cyber-attacks.
▪ Fairness: Promoting democracy, fundamental Commonwealth Innovation Index
freedoms and good governance across the ▪ It was launched as part of a new Commonwealth
Commonwealth.
Innovation Hub on the sidelines of the CHOGM.
▪ Sustainability: Building the resilience of small
and vulnerable states to deal with the effects of ▪ It has been created in partnership with the
climate change and other global crisis. United Nations World Intellectual Property
Organisation (WIPO) and its annual Global
Commonwealth Secretariat Innovation Index (GII).
▪ India was ranked 10th on the new Index, topped
▪ The Commonwealth Secretariat, established by the UK, Singapore and Canada.
in 1965, is the main intergovernmental
agency of the Commonwealth, facilitating Commonwealth Innovation Fund
consultation and co-operation among member
governments and countries. It is responsible to ▪ The Global Innovation Fund (GIF) will also host
member governments collectively. a new Commonwealth Innovation Fund (CIF) with
▪ The Commonwealth of Nations is represented in size of 25 million pounds with financial
the United Nations General Assembly by the commitments from member-countries.
secretariat as an observer. ▪ It will deploy grant, equity and debt investments to
▪ The secretariat organises Commonwealth support innovators across the Commonwealth to
summits, meetings of ministers, consultative accelerate the development, testing and scaling up
meetings and technical discussions; it assists
of evidence-based and market-tested innovations.
policy development and provides policy advice,
and facilitates multilateral communication among India & the Commonwealth
the member governments.
▪ India became a member of the Commonwealth in
Commonwealth Human Rights Initiative (CHRI) 1947, the first with chiefly non-European
populations.
▪ The Commonwealth Human Rights Initiative ▪ India’s new political interest in the
(CHRI) is an independent, non-partisan, Commonwealth is evident by the participation of
international nongovernmental Prime Minister Narendra Modi at the 25th
organization, headquartered in New Delhi. Commonwealth Heads of Government Meeting
▪ The organization works for the practical (CHOGM) in London in 2018, marking the first
realization of human rights across the Indian prime ministerial presence in a
Commonwealth. In 1987, several Commonwealth Summit after nearly a decade.
Commonwealth associations founded CHRI as a ▪ There are few reasons behind India’s political
response to South Africa’s policy of racism. interest in the Commonwealth
▪ CHRI's objectives are to promote awareness of and 1. First, the membership of the Commonwealth,
adherence to the Harare Commonwealth virtually spanning the entire globe. For India,
Declaration, the Universal Declaration of membership and prospective leaders of the
Human Rights, and other internationally Commonwealth helps enhance its bilateral ties
recognized human rights instruments, as well as with individual countries.
domestic instruments supporting human rights in 2. The growing importance of small states for India’s
member states. foreign policy. A high proportion of
Commonwealth members, about 60 per cent, are
Blue Charter on Ocean Governance small states.

265
3. Commonwealth-wide presence of Indian diaspora.
4. China is not and will never be a member of the
Commonwealth.
Issues with the Commonwealth

▪ The grouping has no political or economic power, and even former immigration advantages between
Commonwealth countries have also ceased to exist.
▪ Considering its declining importance former PM Manmohan Singh skipped two CHOGM meets, while Narendra
Modi didn’t attend the last one, held in Malta in 2015.
▪ Amidst the calls for the position of Commonwealth Head to be more democratically shared or rotated the
announcement of Prince Charles as the successor has also put a dent on its democratic credentials.

Importance of Commonwealth
▪ From the Indian perspective, the Commonwealth offers opportunities to reach out to small states that make up
around 60% of Commonwealth members. In some of these states, India has no diplomatic presence, and forging
relations with these countries could help India secure crucial votes during UN or multilateral contests it is
involved in.
▪ It is also a larger network of countries than any other, except for UN, which gives a chance for smaller countries
to have their voices heard and make their projects and concerns known.
▪ On a geo-political scale, the Commonwealth of Nations continues to be an impressive show of the force of a
peaceful alliance. Also, for India it provides an excellent opportunity to give shape to a model of international co-
operation and partnership distinct from that of China.
▪ It also remains a great platform for development aid, democratic values and educational opportunities, but its
relevance is unlikely to increase unless it adopts a more egalitarian and inclusive attitude to its next generation of
Commonwealth citizens.

Maldives re-joined the Commonwealth

▪ The Maldives has recently re-joined the Commonwealth as 54th member, reversing its earlier policy of isolation.
▪ The island nation was readmitted after showing evidence of functioning democratic processes and popular
support for being part of the family of nations.

266
 (UNIT-6) CH-1 UNITED NATIONS
Basics and Background:
▪ The United Nations (UN) is an international organization founded in 1945. It is
currently made up of 193 Member States.
▪ Its mission and work guided by the purposes and principles contained in its
founding Charter and implemented by its various organs and specialised
agencies.
▪ Its activities include maintaining international peace and security, protecting
human rights, delivering humanitarian aid, promoting sustainable
development and upholding international law.
▪ UN has 4 main purposes–
1. To keep peace throughout the world;
2. To develop friendly relations among nations;
3. To help nations work together to improve the lives of poor people, to conquer hunger, disease and illiteracy,
and to encourage respect for each other’s rights and freedoms;
4. To be a centre for harmonizing the actions of nations to achieve these goals.

Organs of UN:

UN
ICJ
Secretariat

Security Trusteeship
Council Council

General UN ECOSOC
Assembly
Organs

▪ The main organs of the UN are the General Assembly, the Security Council, the Economic and Social Council,
the Trusteeship Council, the International Court of Justice, and the UN Secretariat.
▪ All were established in 1945 when the UN was founded.

General Assembly:
▪ The General Assembly is the main deliberative, policymaking and representative organ of the UN.
▪ All 193 Member States of the UN are represented in the General Assembly, making it the only UN body
with universal representation.
▪ Each year, in September, the full UN membership meets in the General Assembly Hall in New York for
the annual General Assembly session, and general debate, which many heads of state attend and address.
▪ Decisions on important questions, such as those on peace and security, admission of new members and budgetary
matters, require a two-thirds majority of the General Assembly.
▪ Decisions on other questions are by simple majority.
▪ The President of the General Assembly is elected each year by assembly to serve a one-year term of office.
▪ 6 Main Committees: Draft resolutions can be prepared for the General Assembly by its six main committees:

1. Disarmament & International Security

2. Economic & Financial
3. Social, Humanitarian & Cultural
4. Special Political & Decolonization

267
 5. Administrative & Budgetary
6. Legal

Security Council
▪ It has primary responsibility, under the UN Charter, for the maintenance of international peace and security.
▪ The Security Council is made up of fifteen member states, consisting of five permanent members - China,
France, Russia, the United Kingdom, and the United States—and ten non-permanent members elected for two-
year terms by the General Assembly on a regional basis.
▪ "Veto power" refers to the power of the permanent member to veto (Reject) any resolution of Security Council.
▪ The unconditional veto possessed by the five governments has been seen as the most undemocratic character of
the UN.
▪ Critics also claim that veto power is the main cause for international inaction on war crimes and crimes against
humanity.
▪ However, the United States refused to join the United Nations in 1945 unless it was given a veto. The absence
of the United States from the League of Nations contributed to its ineffectiveness.
▪ Supporters of the veto power regard it as a promoter of international stability, a check against military
interventions, and a critical safeguard against U.S. domination.

Economic and Social Council (ECOSOC)

▪ It is the principal body for coordination, policy review, policy dialogue and recommendations on economic, social
and environmental issues, as well as implementation of internationally agreed development goals.
▪ It has 54 Members, elected by the General Assembly for overlapping three-year terms.
▪ It is the United Nations’ central platform for reflection, debate, and innovative thinking on sustainable
development.
▪ Each year, ECOSOC structures its work around an annual theme of global importance to sustainable
development. This ensures focused attention, among ECOSOC’s array of partners, and throughout the UN
development system.
▪ It coordinates the work of the 14 UN specialized agencies, ten functional commissions and five regional
commissions, receives reports from nine UN funds and programmes and issues policy recommendations to the UN
system and to Member States.

Trusteeship Council
▪ It was established in 1945 by the UN Charter, under Chapter XIII.
▪ Trust territory is a non-self-governing territory placed under an administrative authority by the Trusteeship
Council of the United Nations.
▪ A League of Nations mandate was a legal status for certain territories transferred from the control of one country
to another following World War I, or the legal instruments that contained the internationally agreed-upon terms
for administering the territory on behalf of the League of Nations.
▪ United Nations trust territories were the successors of the remaining League of Nations mandates, and came
into being when the League of Nations ceased to exist in 1946.
▪ It had to provide international supervision for 11 Trust Territories that had been placed under the administration of
seven Member States, and ensure that adequate steps were taken to prepare the Territories for self-government and
independence.
▪ By 1994, all Trust Territories had attained self-government or independence. The Trusteeship Council suspended
operation on 1 November 1994.
International Court of Justice
▪ The International Court of Justice is the principal judicial organ of the United Nations. It was established in June
1945 by the Charter of the United Nations and began work in April 1946.
▪ The ICJ is the successor of the Permanent Court of International Justice (PCIJ), which was established by the
League of Nations in 1920.

Secretariat
▪ The Secretariat comprises the Secretary-General and tens of thousands of international UN staff members who
carry out the day-to-day work of the UN as mandated by the General Assembly and the Organization's other
principal organs.

268
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▪ The Secretary-General is chief administrative officer of the Organization, appointed by the General Assembly
on the recommendation of the Security Council for a five-year, renewable term.
▪ UN staff members are recruited internationally and locally, and work in duty stations and on peacekeeping
missions all around the world.

Funds and Programmes

1. UNICEF:
▪ The United Nations Children's Fund (UNICEF), originally known as the United Nations International
Children's Emergency Fund, was created by the United Nations General Assembly in 1946, to provide
emergency food and healthcare to children and mothers in countries that had been devastated by World War
II.
▪ In 1950, UNICEF's mandate was extended to address the long-term needs of children and women in
developing countries everywhere.
▪ In 1953, it became a permanent part of the United Nations System, and the words "international" and
"emergency" were dropped from the organization's name, though it retained the original acronym, "UNICEF".
▪ Executive Board: A 36-member board establishes policies, approves programs and oversees administrative
and financial plans. The members are government representatives who are elected by the United Nations
Economic and Social Council (ECOSOC), usually for three-year terms.
▪ UNICEF relies on contributions from governments and private donors.
▪ UNICEF's Supply Division is based in Copenhagen (Denmark) and serves as the primary point of
distribution for such essential items as vaccines, antiretroviral medicines for children and mothers with HIV,
nutritional supplements, emergency shelters, family reunification, and educational supplies.

2. UNFPA:
▪ The United Nations Population Fund (UNFPA), formerly the United Nations Fund for Population
Activities, is the United Nations sexual and reproductive health agency.
▪ Its mission is to deliver a world where every pregnancy is wanted, ‘every childbirth is safe’ and every young
person's potential is fulfilled.
▪ In 2018, UNFPA launched efforts to achieve three transformative results, ambitions that promise to change
the world for every man, woman and young person:
o Ending unmet need for family planning
o Ending preventable maternal death
o Ending gender-based violence and harmful practices

3. UNDP:
▪ The United Nations Development Programme (UNDP) is the UN's global development network.
▪ UNDP was established in 1965 by the General Assembly of the United Nations.
▪ It provides expert advice, training and grants support to developing countries, with increasing emphasis on
assistance to the least developed countries.
▪ The UNDP Executive Board is made up of representatives from 36 countries around the world who serve on
a rotating basis.
▪ It is funded entirely by voluntary contributions from member nations.
▪ UNDP is central to the United Nations Sustainable Development Group (UNSDG), a network that spans
165 countries and unites the 40 UN funds, programmes, specialized agencies and other bodies working to
advance the 2030 Agenda for Sustainable Development.

4. UNEP:
▪ The United Nations Environment Programme (UN Environment) is a global environmental authority that sets
the global environmental agenda, promotes the coherent implementation of the environmental dimension of
sustainable development within the United Nations system.
▪ It was founded by UN General Assembly as a result of the United Nations Conference on the Human
Environment (Stockholm Conference) in June 1972.
▪ UNEP and World Meteorological Organization (WMO) established Intergovernmental Panel on
Climate Change (IPCC) in 1988 to assess climate change based on the latest science.
▪ Since its founding, the UNEP has played a key role for the development of multilateral environmental
agreements (MEAs). The secretariats for the following nine MEAs are currently hosted by UNEP:

269
 o Convention on Biological Diversity (CBD)
o Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES)
o Convention on the Conservation of Migratory Species of Wild Animals (CMS)
o Vienna Convention for the Protection of the Ozone Layer
o Minamata Convention on Mercury
o Basel Convention on the Control of Trans-boundary Movements of Hazardous Wastes and Their
Disposal
o Stockholm Convention on Persistent Organic Pollutants
o Rotterdam Convention on the Prior Informed Consent Procedure for Certain Hazardous Chemicals and
Pesticides in International Trade

5. UN-HABITAT:
▪ United Nations Human Settlements Programme (UN-Habitat) is the United Nations programme working
towards a better urban future.
▪ Its mission is to promote socially and environmentally sustainable human settlements development and the
achievement of adequate shelter for all.
▪ It was established in 1978 as an outcome of the First UN Conference on Human Settlements and
Sustainable Urban Development (Habitat I) in Vancouver, Canada, in 1976.
▪ 2nd United Nations Conference on Human Settlements (Habitat II) in Istanbul, Turkey, in 1996, set the
twin goals of the Habitat Agenda:
o Adequate shelter for all
o Development of sustainable human settlements in an urbanizing world.
▪ 3rd United Nations Conference on Housing and Sustainable Urban Development (Habitat III) was held
in 2016 in Quito, Ecuador. It elaborated on Goal-11 of the Sustainable Development Goals (SDG): "Make
cities and human settlements inclusive, safe, resilient, and sustainable.

6. WFP:
▪ World Food Programme (WFP) is the leading humanitarian organization saving lives and changing lives,
delivering food assistance in emergencies and working with communities to improve nutrition and build
resilience.
▪ The WFP was established in 1963 by the FAO (The Food and Agriculture Organization) and the United
Nations General Assembly.

UN Specialized Agencies:
Articles 57 and 63 of UN Charter provides provision of creating specialized agencies.

1. FAO
▪ In 1945, Food and Agriculture Organization (FAO) was created in Quebec City, Canada, by the first
session of the newly created United Nations.
▪ FAO is a specialized agency of the United Nations that leads international efforts to defeat hunger.
▪ FAO is also a source of knowledge and information, and helps developing countries in transition modernize
and improve agriculture, forestry and fisheries practices, ensuring good nutrition and food security for all.

2. ICAO
▪ Under Chicago Convention, the International Civil Aviation Organization (ICAO) was established in
1944, as a UN specialized agency. It manages the administration and governance of the Convention on
International Civil Aviation (Chicago Convention).
▪ It provides the principles and techniques of international air navigation and fosters the planning and
development of international air transport to ensure safe and orderly growth.

3. IFAD
▪ The International Fund for Agricultural Development (IFAD) was established as an international financial
institution in 1977 through United Nations General Assembly Resolution as one of the major outcomes of
the 1974–World Food Conference.

270
 ▪ This conference was organized by the United Nations in response to the food crises of the early 1970s, when
global food shortages were causing widespread famine and malnutrition, primarily in the Sahelian countries
of Africa.

4. ILO
▪ The International Labour Organization (ILO) is a United Nations agency whose mandate is to advance social
justice and promote decent work by setting international labour standards.
▪ It sets international labour standards, promotes rights at work and encourages decent employment
opportunities, the enhancement of social protection and the strengthening of dialogue on work-related issues.
▪ As an agency of the League of Nations, it was created in 1919, as part of the Treaty of Versailles that ended
World War I.
▪ 9 International Labour Conventions and 10 Recommendations which dealt with hours of work in
industry, unemployment, maternity protection, night work for women, minimum age, and night work for
young persons in industry were adopted in less than two years (by 1922).
▪ By signing of the United Nation agreement whereby the ILO became the first United Nations specialized
agency in 1946.
▪ The Organization won the Nobel Peace Prize on its 50th anniversary in 1969 for pursuing decent work and
justice for workers.
▪ It emphasised that the future of work is not predetermined: Decent work for all is possible but societies have
to make it happen. It is precisely with this imperative that the ILO established its Global Commission on the
Future of Work as part of its initiative to mark its centenary in 2019.
▪ Its job is to undertake an in-depth examination of the future of work that can provide the analytical basis for
the delivery of social justice in the 21st century.

5. IMF
▪ UN Monetary and Financial Conference (1944, also called Bretton Woods Conference), Bretton Woods,
New Hampshire, United States was held to regulate the international monetary and financial order after the
conclusion of World War II.
▪ It resulted in foundation of International Monetary Fund (IMF) in 1945.

6. WORLD BANK
▪ UN Monetary and Financial Conference (1944, also called Bretton Woods Conference), was held to
regulate the international monetary and financial order after the conclusion of World War II. It resulted in
foundation of IBRD in 1945. IBRD is the founding institution of World Bank

7. IMO
▪ The International Maritime Organization (IMO) – is the United Nations specialized agency with
responsibility for the safety and security of shipping and the prevention of marine and atmospheric
pollution by ships.

8. ITU
▪ International Telecommunication Union (ITU) is a specialized agency of the United Nations (UN) that is
responsible for issues that concern information and communication technologies (ICT). It is the oldest among
all the specialised agencies of UN.
▪ It was founded in 1865 and based in Geneva, Switzerland. It works on the principle of international
cooperation between governments (Member States) and the private sector (Sector Members, Associates and
Academia).
▪ ITU is the premier global forum through which parties work towards consensus on a wide range of issues
affecting the future direction of the ICT industry.
▪ It allocates global radio spectrum and satellite orbits, develop the technical standards that ensure networks
and technologies seamlessly interconnect, and strive to improve access to ICTs to underserved communities
worldwide.

9. UNESCO

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 ▪ United Nations Educational, Scientific and Cultural Organization (UNESCO) was founded in 1945 to
develop the “intellectual and moral solidarity of mankind” as a means of building lasting peace. It is
located in Paris (France).
▪ In this spirit, UNESCO develops educational tools to help people live as global citizens free of hate and
intolerance.
▪ By promoting cultural heritage and the equal dignity of all cultures, UNESCO strengthens bonds among
nations.

10. UNIDO
▪ United Nations Industrial Development Organization (UNIDO) promotes industrial development for poverty
reduction, inclusive globalisation and environmental sustainability.

11. WHO
▪ The World Health Organization (WHO) is the United Nations’ specialized agency for health.
▪ It was established in 1948, and is headquartered in Geneva, Switzerland.
▪ It is an inter-governmental organization and works in collaboration with its Member States usually through the
Ministries of Health.
▪ The World Health Organization (WHO) is responsible for:
o Providing leadership on global health matters,
o Shaping the health research agenda,
o Setting norms and standards,
o Providing evidence-based policy options,
o Providing technical support to countries,
o Monitoring and assessing health trends.

12. UNCTAD
▪ UNCTAD supports developing countries to access the benefits of a globalized economy more fairly and
effectively.
▪ It helps to use trade, investment, finance, and technology as vehicles for inclusive and sustainable
development.

13. UNODC
▪ United Nations Office on Drugs and Crime (UNODC) is a global leader in the fight against illicit drugs and
international crime.
▪ It was established in 1997 through a merger between the United Nations Drug Control Programme and the
Centre for International Crime Prevention.
▪ UNODC is mandated to assist Member States in their struggle against illicit drugs, crime and terrorism.

14. UNHCR
▪ The office of the United Nations High Commissioner for Refugees (UNHCR) was created in 1950, during
the aftermath of the Second World War, to help millions of Europeans who had fled or lost their homes.
▪ In 1954, UNHCR won the Nobel Peace Prize for its ground-breaking work in Europe.
▪ The start of the 21st century has seen UNHCR help with major refugee crises in Africa, the Middle East and
Asia.
▪ It also uses its expertise to help many internally displaced by conflict and expanded its role in helping stateless
people.

15. ESCAP
▪ United Nations Economic and Social Commission for Asia and the Pacific (ESCAP) is the main economic
and social development centre of the UN in the region, headquartered in Bangkok (Thailand) in 1947.
▪ It responds to the development needs and priorities of the region through its convening authority, economic
and social analysis, normative standard-setting and technical assistance.

Area of UN Contributions:

1. MAINTAIN INTERNATIONAL PEACE AND SECURITY

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 ▪ The United Nations came into being in 1945, following the devastation of the Second World War, with one
central mission: the maintenance of international peace and security.
▪ The UN does this by working to prevent conflict; helping parties in conflict make peace; peacekeeping;
and creating the conditions to allow peace to hold and flourish.
▪ These activities often overlap and should reinforce one another, to be effective.
▪ The UN Security Council has the primary responsibility for international peace and security.
▪ The General Assembly and the Secretary-General play major, important, and complementary roles, along with
other UN offices and bodies.

2. PROTECT HUMAN RIGHTS

▪ The term “human rights” was mentioned seven times in the UN's founding Charter, making the promotion
and protection of human rights a key purpose and guiding principle of the Organization.
▪ In 1948, the Universal Declaration of Human Rights brought human rights into the realm of international
law.
▪ Since then, the Organization has diligently protected human rights through legal instruments and on-the-
ground activities.

3. DELIVER HUMANITARIAN AID

▪ One of the purposes of the United Nations, as stated in its Charter, is "to achieve international co-operation
in solving international problems of an economic, social, cultural, or humanitarian character."
▪ The UN first did this in the aftermath of the Second World War on the devastated continent of Europe, which
it helped to rebuild.
▪ The Organization is now relied upon by the international community to coordinate humanitarian relief
operations due to natural and man-made disasters in areas beyond the relief capacity of national authorities
alone.

4. PROMOTE SUSTAINABLE DEVELOPMENT

▪ From the start in 1945, one of the main priorities of the United Nations was to “achieve international co-
operation in solving international problems of an economic, social, cultural, or humanitarian character
and in promoting and encouraging respect for human rights and for fundamental freedoms for all
without distinction as to race, sex, language, or religion.”
▪ Improving people’s well-being continues to be one of the main focuses of the UN.
▪ The global understanding of development has changed over the years, and countries now have agreed that
sustainable development – development that promotes prosperity and economic opportunity, greater social
well-being, and protection of the environment – offers the best path forward for improving the lives of
people everywhere.

A SUSTAINABLE DEVELOPMENT AGENDA

▪ A sustainable development portal, 2015 Time for Global Action for People and Planet, was launched by the
United Nations in 2015.
▪ It focuses on the UN’s post-2015 sustainable development agenda and contains information on the UN’s
efforts to tackle climate change and on many other related issues.
▪ The UN’s new post-2015 sustainable development agenda was launched at the Sustainable Development
Summit in September 2015.
▪ The Millennium Development Goals helped end poverty for some, but not for all.
▪ The UN’s new Sustainable Development Goals (SDGs) will complete the work begun with the MDGs.

5. UPHOLD INTERNATIONAL LAW

▪ The UN Charter, in its Preamble, set an objective: "to establish conditions under which justice and
respect for the obligations arising from treaties and other sources of international law can be
maintained".
▪ Ever since, the development of, and respect for international law has been a key part of the work of the
Organization.

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 ▪ This work is carried out in many ways - by courts, tribunals, multilateral treaties - and by the Security
Council, which can approve peacekeeping missions, impose sanctions, or authorize the use of force when
there is a threat to international peace and security, if it deems this necessary.
▪ These powers are given to it by the UN Charter, which is considered an international treaty. As such, it is
an instrument of international law, and UN Member States are bound by it.
▪ The UN Charter codifies the major principles of international relations, from sovereign equality of States to
the prohibition of the use of force in international relations.

India and the UN

▪ India was among the original members of the United Nations that signed the Declaration by United Nations at
Washington, D.C. in October of 1944 and also participated in the United Nations Conference on International
Organization at San Francisco from 25 April to 26 June 1945.
▪ As a founding member of the United Nations, India strongly supports the purposes and principles of the UN and
has made significant contributions in implementing the goals of the Charter, and the evolution of the UN's
specialized programmes and agencies.

INDIAN CONTRIBUTION TO UNITED NATIONS PEACEKEEPING

▪ India has a long and distinguished history of service in UN peacekeeping, having contributed more personnel than
any other country.
▪ To date, more than 244,500 Indians have served in 49 of the 71 UN peacekeeping missions established around the
world since 1948. India has a long tradition of sending women on UN peacekeeping
missions. In 2007, India became the first country to deploy an all-women contingent
for Formed Police Unit to the UN peacekeeping mission in Liberia.
▪ Hailed as role models, they helped to build the capacity of the Liberian police which
led to increase in the number of local women working in the Liberia’s security sector.
▪ The members of Indian Women FPU also distinguished themselves through
humanitarian service, including organizing medical camps.
▪ Indian peacekeepers in South Sudan received prestigious UN medal.

REPRESENTATION IN UN BODIES
▪ India enjoys strong goodwill and support at the UN and has been elected to several UN bodies. In the last few
years, India was elected to the Human Right Council (HRC), Economic and Social Council (ECOSOC),
International Narcotics Control Board (INCB), International Court of Justice (ICJ), UN Board of Auditors,
Committee on Economic, Social and Cultural Rights (CESCR), International Tribunal for the Law of the
Sea (ITLOS), International Law Commission (ILC) and Joint Inspection Unit (JIU), among others.
▪ Currently India is represented in 22 UN Bodies.

INDIA ON THE UN SECURITY COUNCIL

▪ India has served in the UN Security Council seven times (1950-51, 1967-68, 1972-73, 1977-78, 1984-85, 1991-
92 and 2011-12). During its last term (2011- 12) on the UN Security Council, India chaired the UNSC 1373
Committee concerning Counter-Terrorism, the 1566 Working Group concerning threat to international peace
and security by terrorist acts and the Security Council 751/1907 Committee concerning Somalia and Eritrea.
▪ India played an active role in discussions on all issues related to international peace and security, including
several new challenges which the Security Council was called upon to deal with in Afghanistan, Cote d’Ivoire,
Iraq, Libya, South Sudan, Syria and Yemen.
▪ India also worked for enhancing international cooperation in the areas of counter-terrorism, prevention of the
proliferation of weapons of mass destruction to non-state actors, and the strengthening of UN peacekeeping and
peace building efforts.

TERRORISM
▪ The international effort against terrorism is a key priority for India in the UN.
▪ Terrorism is a global phenomenon whose destructive potential and lethal reach is enhanced by linkages to illicit
trafficking in drugs and small arms, and international money laundering operations.
▪ India is a party to the 13 sectoral conventions on terrorism adopted by the UN. With the objective of providing a
comprehensive legal framework to combat terrorism, India took the initiative to pilot a draft Comprehensive
Convention on International Terrorism (CCIT) in 1996.

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▪ India also supports strict global implementation of anti-terrorism mechanisms established by UN Security
Council Resolutions, including Resolutions 1267/1989 (related to sanctions against ISIS (Da’esh) and Al-Qaeda)
and 1988 (related to sanctions against Taliban), 1373 (related to Counter-Terrorism Committee), and 1540 (
pertaining to non-proliferation of WMDs), and other international mechanisms such as Financial Action Task
Force (FATF).

HUMAN RIGHTS
▪ On human rights, India advocates a holistic and integrated approach that emphasizes the inter-dependence,
inter-relatedness, indivisibility and university of human rights.
▪ India’s position reinforces the inter-relationship between democracy, development, human rights and
international cooperation for development.
▪ India played an active role in drafting the Universal Declaration on Human Rights and is fully committed to
the rights proclaimed in the Universal Declaration.
▪ India is party to the five core human rights covenants/conventions, namely, the International Covenant on
civil and Political Rights (ICCPR), the International Covenant on Economic, Social and Cultural Rights
(ICESCR), International Convention on the Elimination of All Forms of Racial Discrimination (ICERD),
the Convention on the Elimination of All Forms of Discrimination against Women (CEDAW) and the
Convention on the Rights of the Child (CRC).
▪ India has also signed the UN Convention against Transnational Organized Crime (UNTOC).

REFORM & RESTRUCTURING OF THE UN

▪ India strongly advocates the process of reform and restructuring of the UN to make it better equipped to
effectively respond to the evolving needs of its membership, particularly developing countries.
▪ The expansion of the Security Council and improvement of its working methods must be integral part of Security
Council Reform.
▪ It is essential that the Security Council is expanded in both the permanent and non-permanent categories.
▪ The inclusion of countries who are capable of global responsibility regarding peace and security, including
developing countries from Asia, Africa and Latin America, will contribute to optimal decision by the Council as
well as address the concerns of the developing countries.

Un Global Counter Terrorism Coordination Combat:

▪ It is an agreement between the UN chief, 36 organizational entities, the International Criminal Police
Organisation (INTERPOL) and the World Customs Organisation, to better serve the needs of Member States
when it comes to tackling international terrorism.

OBJECTIVE:
▪ To ensure that the United Nations system provides coordinated capacity-building support to Member States, at
their request, in implementing the UN Global Counter-Terrorism Strategy and other relevant resolutions.
▪ To foster close collaboration between the Security Council mandated bodies and the rest of the United
Nations system.
▪ The UN Global Counter-Terrorism Compact Coordination Committee will oversee and monitor the
implementation of the Compact which will be chaired by UN Under-Secretary-General for counterterrorism.
▪ It will replace the Counter-Terrorism Implementation Task Force, which was established in 2005.

UNSC Non-Permanent Seat

▪ India has won the unanimous support of all countries in the 55-member Asia-Pacific Group at the United
Nations in support of its bid for a non-permanent seat at the UN Security Council (UNSC) for a two-year term
in 2021-22.

UNSC MEMBERSHIP
▪ Along with the five permanent members, the Security Council of the United Nations has ten temporary members
that hold their seats on a rotating basis by geographic region.
▪ Five permanent members: China, France, Russia, UK, and the US.
▪ The 10 non-permanent seats are distributed on a regional basis:
1. Five for African and Asian States;
2. One for Eastern European States;

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3. Two for the Latin American and Caribbean States; and
4. Two for Western European and other States.
▪ Each year the 193-member of UNGA elects five non-permanent members for a two-year term at the UNSC,
with five replaced each year.
▪ To be approved, a candidate must receive at least two-thirds of all votes cast for that seat, which can result in
deadlock if there are two roughly evenly matched candidates.
▪ A retiring member is not eligible for immediate re-election.
▪ The Asia-Pacific Group gets to nominate one of its members for the 2020 elections to a non-permanent seat of
UNSC.
▪ Currently the 10 non-permanent members are Belgium, Cote d'Ivoire, Dominican Republic, Equatorial
Guinea, Germany, Indonesia, Kuwait, Peru, Poland and South Africa.

UN Habitat Assembly
▪ India has been elected to the Executive Board of the first UN-Habitat Assembly.
▪ The first session of UN- Habitat assembly was held at the headquarters of UN-Habitat in Nairobi.
▪ The special theme for the UN-Habitat assembly is "Innovation for Better Quality of Life in Cities and
Communities".

UN HABITAT
▪ The United Nations Human Settlements Programme (UN–Habitat) is the United Nations programme for
human settlements and sustainable urban development.
▪ Established in 1978 as an outcome of the First UN Conference on Human Settlements and Sustainable Urban
Development (Habitat I) held in Vancouver, Canada in 1976.
▪ Mandate is to promote socially and environmentally sustainable towns and cities. It is the focal point for all
urbanization and human settlement matters within the UN system.
▪ It is a member of the United Nations Sustainable Development Group.

UN 75th Declaration
▪ As the UN marks 75 years of its existence, the 193-member UN General Assembly adopted a forward-looking
political declaration that gave a clarion call for –
✓ Strengthening mechanism to combat terrorism,
✓ Reformed multilateralism,
✓ Inclusive development
✓ Better preparedness to deal with challenges like the Covid-19 pandemic
✓ Reform of the United Nations itself
▪ This declaration is meant to commemorate the 75th anniversary of UN on 24th October.
▪ The UN is marking its 75th anniversary at a time of great disruption for the world, compounded by an
unprecedented global health crisis with severe economic and social impacts. In these hard times, the role and
responsibility of the UN increase more than ever.
▪ Since January 2020 the UN is holding a people’s debate UN75, through which it aims to encourage people to put
their opinions together to define how enhanced international cooperation can help realize a better world by 2045.

Successes of UN
▪ The UN defined, codified and expanded the realm of international law, governing the legal responsibilities of
States in their conduct with each other, and their treatment of individuals within State boundaries.
▪ The U.N. has solved many violent conflicts, prevented wars, and saved millions of lives.
▪ More than 560 multilateral treaties on human rights, refugees, disarmament, trade, oceans, outer space, etc.
encompassing all aspects of international affairs were negotiated by the U.N.
▪ The ECOSOC continually monitors the progress of development, particularly in the light of the MDGs.
▪ It has created a new UN Committee of Experts on Global Geospatial Information Management which brings
together government experts from all Member States to compile and disseminate best practices and experiences on
geospatial information which helps in the context of sustainable development and humanitarian assistance.
▪ The ICJ has a positive effect on the development of International Law and the propagation of the principles of
sovereignty, non-conquest, human rights and the rights of existence and self-defence of a state.

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▪ The ICJ provides an additional option for states to settle their disputes peacefully through third party
intervention, and this has reduced the threat of open war.

Failures of UN
▪ In 1970, though the Nuclear Non-proliferation Treaty (NPT) was signed by 190 nations, all five superpowers
owned nuclear weapons. Despite the NPT and Partial Test Ban Treaty, several countries – North Korea, Israel,
Pakistan, and India have developed nuclear weapons. Thus the UN has failed to enforce regulations on
offending nations.
▪ Though the ICJ has resolved major international disputes, the U.N.’s veto powers have limited its effectiveness at
critical times.
▪ Human Rights violations are happening at conflict-prone regions like Gaza-strip but UNSC has failed as the
United States vetoes any action against Israel.
▪ The Arab Spring in the Middle East which caused thousands of deaths and regime changes, the rise of ISIS,
gruesome killings might have been prevented if the Member States of the U.N. had the ability to resolutely act in a
timely manner.
▪ But the U.N. is not a world government, and it does not have a standing army of peace-keepers ready for
deployment.
▪ NGO workers from around the world have blamed that vulnerable people are being denied representation at
the UN by the dysfunctional nature of the NGO committee and its parent body, the Ecosoc.
▪ The ICJ is noted for its failures to successfully resolve inter-state disputes. To date there are more than 30
unresolved frontier cases concerning land of greater value, which has never been submitted to the ICJ, because
one party’s claim is not on legal grounds.
▪ Major issues of peace and security between the more powerful states are rarely submitted as most governments
tend to “consider the recognition of the jurisdiction of the court as infringing on their sovereignty”.
▪ There is no real means of enforcing the ICJ’s verdict.

Overall Reforms Needed

▪ The UN, in recent years, has faced a cash crunch. Hence there should be an increase in funding which is timely.
▪ Once the world is on a robust path to achieve the SDGs, the need for peacekeeping and emergency-relief
operations should decline as conflicts diminish in number and scale.
▪ The UN needs to strengthen its expertise in areas such as ocean health, renewable energy systems, urban design,
disease control, technological innovation, public-private partnerships, and peaceful cultural cooperation.
▪ Some UN programs should be merged or closed, while other new SDG-related UN programs should be created.
▪ UN’s governance should be mended, starting with the Security Council, the composition of which no longer
reflects global geopolitical realities.
▪ The Western Europe and Other Group (WEOG) now accounts for three of the five permanent members (France,
the United Kingdom, and the US) but Africa or Latin America has none.
▪ The rotating seats on the Security Council do not adequately restore regional balance.
▪ Seats for Asia, which represents the world’s most dynamic and populous region should be increased.
▪ Any substantial reform can be achieved by amending the UN Charter which requires an affirmative vote and
domestic ratification by two-thirds of UN member states.
▪ In addition to charter reform, procedural changes, including greater transparency and closer consultations
with troop-contributing countries is required.

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 CH-2 INDIA AND UNSC REFORM
Basics and Background:
▪ India has been actively pursuing its quest to be included in the reformed United
Nations Security Council for many years.
▪ The argument of including new members is that UNSC has to acknowledge the
current geopolitical realities which are very different from the time when UNSC
was formed.
▪ The current permanent members of the Security Council are the five nations that
were made permanent members in the charter when the United Nations was founded.
▪ These countries were the victors in the World War II and China were their allies.

UNSC:

▪ The UNSC is one of the six principal organs of the United Nations and is charged with the maintenance of
international peace and security.
▪ Its powers include the establishment of peacekeeping operations, the establishment of international sanctions,
and the authorization of military action through Security Council resolutions.
▪ It is the only UN body with the authority to issue binding resolutions to member states.
▪ The Security Council consists of fifteen members. Russia, the United Kingdom, France, China, and the
United States—serve as the body’s five permanent members.
▪ These permanent members can veto any substantive Security Council resolution, including those on the
admission of new member states or candidates for Secretary-General.
▪ The Security Council also has 10 non-permanent members, elected on a regional basis to serve two-year terms.
The body’s presidency rotates monthly among its members.

UNSC Reform Agenda:

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▪ The current negotiation process is based on Decision 62/557 which was adopted in 2008.
▪ It defines five key issues for reform:
o Categories of membership,
o The question of the veto,
o Regional representation,
o The size of an enlarged Security Council and its working methods, and
o The relationship between the Security Council and the General Assembly.
▪ Decision 62/557 also stipulates that any solution must garner “the widest possible political acceptance”, although
in 1998 the UN General Assembly already agreed that the support of two-thirds of UN member states is
sufficient.
▪ Yet even if these conditions are met any of the P5 will still be able to veto the final resolution. For example,
China and Russia have previously stated that reform should be based on a consensus and not on a majority vote.

Need of reforms in UNSC:

▪ Reforms Long Overdue: It was expanded only once in 1963 to add 4 non-permanent members. Although the
overall membership of the UN has increased from 113 to 193 but no change in the composition of the UNSC
happened.
▪ Crisis of legitimacy and credibility: various issues including its Interventions in Libya and Syria in the guise of
responsibility have put the credibility of the institution in jeopardy.
▪ Emerging issues: Issues such as transnational threats, deepening economic interdependence, worsening
environmental degradation also call for effective multilateral negotiations for reforms yet all critical decisions are
still being taken by the veto-wielding permanent members of the Security Council.
▪ Changing geopolitics: UNSC still reflects the geopolitical architecture of the WW II despite the change in power
relations in world. The developing nations, including India, now play a larger role in both the international
economy and politics, yet are not represented in the forum.
▪ Inequitable economic and geographical representation: Major economic and regional powers like Germany
(Europe), Japan, & India (Asia) and Brazil (Latin America) are not yet a part of UNSC. Similarly, there is no
permanent member from Africa, despite the fact that 75% of its work focused on Africa it has no permanent
member from this region.
▪ North South Divide: The permanent UNSC membership of P5 today only portrays the big North-South divide in
the decision making of security measures.

Geopolitics that affected the UN over the years:

▪ Realism at the core of UN System: UN, was meant, by design, to be a concert of great powers who had a
permanent seat in the Security Council. Cooperation among the great powers was the precondition for its success
in the security arena.
▪ During the Cold War, Washington and Moscow were at each other’s throats and the UNSC was deadlocked.
▪ During the brief unipolar moment of the 1990s, post-Soviet Russia was willing to acquiesce to the sweeping
US agenda for global security. China was feeling its way around multilateral institutions and avoided any
challenge to the US and West.
▪ In 2000s, Russia and China began to offer resistance to US dominance.
▪ Present Situation is that of Political Fragmentation: The conflict between the US on the one hand and China
and Russia on the other has become full-blown. To make matters more complicated, the West itself is divided.

UNSC Committee 1267:

▪ Jaish-e-Mohammad (JeM) chief Masood Azhar was listed as a designated global terrorist by the UN Security
Council 1267 Committee in May, 2019.
▪ UNSC Committee 1267 was established in 1999, by Resolution 1267, which imposed a limited air embargo and
asset freeze on the Taliban.
▪ Over time, measures became a targeted asset freeze, travel ban and arms embargo against designated
individuals and entities.
▪ In 2011, after the adoption of resolution 1988, the Committee split into two.
▪ The 1267 Committee was henceforth known as the Al-Qaida Sanctions Committee, mandated to oversee
implementation of the measures against individuals and entities associated with Al-Qaida.
▪ A separate Committee was established pursuant to resolution 1988 (2011) to oversee implementation of the
measures against individuals and entities associated with the Taliban.

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India and UNSC:
▪ India has been spearheading decades-long efforts to reform the Security Council, saying a structure set up in
1945 does not reflect contemporary realities of the 21st century and is ill-equipped to handle current challenges.
▪ There is widespread support, including by four of the five permanent members of the Security Council – US,
UK, France and Russia – for a permanent seat for India at the Council.
▪ China, part of the permanent five (P5) of the UNSC with veto power, has been stonewalling India’s efforts to
become a member of the UN’s powerful body for years, pointing to lack of consensus even though the other four
members have supported New Delhi’s membership.

India and UNSC Reform

▪ Reformed Multilateralism guides India’s approach to the United Nations.
▪ India has long sought a permanent seat at the Council.
▪ It is also a proponent of other UNSC reforms — such as increasing the number of permanent (currently five)
and non-permanent (currently 10) seats and ensuring greater representation for Africa.
▪ India is claiming a permanent seat at the UNSC on the basis of following arguments:
o It's a regular contributor to the UN's peacekeeping missions.
o It's one of the main financial backers of the UN.
o It's the world's largest democracy.
o It's the world's second most populous country.
o It maintains one of the largest armies in the world.
o It is responsible nuclear power despite being non-signatory to NPT.
o India has been elected eight times to the UN Security Council, most recently from 2021 to 2022 after
receiving 184 of 192 votes.
o As a member of G4: The G4 consists of Germany, Japan, India and Brazil. The G4 mainly seek permanent
seats for themselves, but are willing to forego their veto rights for fifteen years or possibly even longer.
o They also demand that Africa should be represented in both the permanent and non-permanent
categories of membership of a reformed and expanded Security Council to correct the historical injustice
against this continent.

G-4 on UNSC Reform:

▪ Ensuring greater representation for Africa: Africa needs to be represented in both the permanent and non-
permanent categories of UNSC to correct the historical injustice against this continent with regard to its under-
representation in the Security Council.
▪ Enhanced role of developing countries and of major contributors to the UN: To make UNSC more legitimate,
effective and representative, it is needed to increase the number of permanent (from 5 to 11) and non-permanent
(from 10 to 14) seats.
▪ The permanent seats shall be elected in the following manner: Two from African States; Two from Asian
States; One from Latin American and Caribbean States ; One from Western European and Other States.
▪ Non-permanent members shall be elected according to the following pattern : One from African States ; One
from Asian States ; One from Eastern European States ; One from Latin American and Caribbean State
▪ The UNSC reforms proposed earlier had been opposed by the five permanent members (P5) of UNSC as
they demanded veto power for new members as well (Razali Plan). However, later the new countries decided to
forego the veto power for new countries which was accepted by P5 countries (Razali Reform Plan).

Razali Reform Plan

Under the plan, the UNSC would have five new permanent members without veto powers, besides four more non-
permanent members taking the council’s strength to 24.

Impact of India’s Permanent Membership:

▪ New included members will get to say in the matters of war and peace, effectively UNSC move towards a
democratic set up where nations like India can put up their matters more strongly and vehemently with
support of their partner nations.
▪ India can represent or lead other countries to stop western forces from promoting their vested interests.
Invasion of Iraq, bombing of Libya, non-recognition of Palestine state are few examples.

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▪ Currently, veto power is a unique privilege of the permanent members, in the regional context China can
exercise this power in matters of war and peace in its own interest. With India getting veto power it will dilute
China's elite status in Asia and will help India to put forward its interest in a better way.
▪ With India's background of continued support of UN's peace keeping missions since 1945 India can assert
more productively its stand on various international issues.
▪ If India becomes a permanent member of UNSC it can shift focus on developing nation’s interest which is the
current demand due to visible shift in focus from west to Asia in world dynamics.
▪ Thus India will have leverage in geopolitics, military, economic and political groupings and negotiations as
permanent member of UNSC.

India’s win on UNSC Non-Permanent Seat:

▪ India has been elected to the United Nations Security Council (UNSC) as a non-permanent member from the
Asia-Pacific category.
▪ India has been elected as one of the non-permanent members to the UNSC with an overwhelming majority of 184
votes out of 192, where the minimum requirement was 128.
▪ This was for the eighth time that India has been elected to UNSC. India has served seven times earlier: 1950-1951,
1967-1968, 1972-1973, 1977-1978, 1984-1985, 1991-1992 and 2011-2012.
▪ India should work with all member countries to promote global peace, security, resilience and equity.

India’s objective as a Non-Permanent Member in UNSC:

▪ Ahead of the vote, India had launched a campaign brochure which highlighted its demand for transparency in
mandates for UN peacekeeping missions and push for the India-led Comprehensive Convention on
International Terrorism, and called for joint efforts for UN reform and expansion of the Security Council.
▪ A “new orientation for a reformed multilateral system” (NORMS), as laid out by External Affairs Minister,
would be India’s overall objective during the two-year tenure that will begin next year.
▪ Achieving this would depend on how India will conduct diplomacy in the global body, build alliances and raise
issues that go beyond the interests of the big five.
▪ India has long been of the view that the structure of the UN Security Council doesn’t reflect the realities of the
21st century.
▪ It has also got increasing support from member countries for its push for reforms. But the five permanent
members of the Security Council have resisted these attempts.
▪ The COVID-19 pandemic has already shaken up the global order and sharpened the rivalry between the U.S.
and China. It has also opened up fresh debates on strengthening multilateralism and multilateral institutions.

Significance of winning:
▪ India’s winning of a non-permanent seat of the UN Security Council one of its best performances ever.
▪ The strong support by almost the entire U.N. membership demonstrates the goodwill that India enjoys in the
U.N. and the confidence that the international community has reposed in India.
▪ India’s EAM gave India’s overall objective during its forthcoming UNSC tenure as an acronym ‘NORMS’ —
New Orientation for a Reformed Multilateral System.
▪ NORMS includes the push for expanding the UNSC permanent membership.

Challenges Ahead:
▪ Implementation hurdles: Achieving the objective laid out in NORMS, would depend on how India will conduct
diplomacy in the global body, build alliances and raise issues that go beyond the interests of the big five
▪ Declining Multilateralism: The COVID-19 pandemic has already shaken up the global order and sharpened the
rivalry between the U.S. and China. This has opened up fresh debates on strengthening multilateralism and
multilateral institutions.
▪ Polarised world: India should avoid the temptation of taking sides at a time when the Security Council is getting
more and more polarised, especially in the wake of US-China tensions

Way Forward:
▪ India’s claim for permanent membership is a genuine demand in the changed geo politics of 21st century as we
have discussed before. India is possibly the most obvious and least controversial option to add as a permanent
member, and probably long overdue for a seat.
▪ UNSC is mandated to keep international peace and security.

281
▪ However it is under constant criticism for its plans and actions. It is said to be performing in unilateral way
with unquestioned authority, working only for vested interests and not making non-permanent members inclusive
in their decision making.
▪ In this context, we can see that India’s demand is not illegitimate as India does wield a certain influence in
world affairs today due to its impressive economic growth and strong military base.
▪ South Asia being a victim of various repercussions of war, terrorism, and extremism India gains more say on its
and neighbor’s problems and will have power to challenge the ethos and working style of permanent members of
UNSC.
▪ In the contemporary period, if India has to make a strong claim to permanent membership, it has to single
mindedly focus on economic growth, with concomitant military might.

282
 CH-3 INTERNATIONAL MONETARY FUND
(IMF)
Basics and Background:
▪ The International Monetary Fund (IMF) is an organization of 189 member
countries, each of which has representation on the IMF's executive board in
proportion to its financial importance, so that the most powerful countries in the
global economy have the most voting power.
▪ The IMF, also known as the Fund, was conceived at a UN conference in Bretton
Woods, New Hampshire, United States, in July 1944.
▪ The 44 countries at that conference sought to build a framework for economic
cooperation to avoid a repetition of the competitive devaluations that had
contributed to the Great Depression of the 1930s.
▪ Countries were not eligible for membership in the International Bank for
Reconstruction and Development (IBRD) unless they were members of the IMF.

Objectives:
▪ Foster global monetary cooperation
▪ Secure financial stability
▪ Facilitate international trade
▪ Promote high employment and sustainable economic growth
▪ And reduce poverty around the world

Functions
▪ Regulatory functions: IMF functions as a regulatory body and as per the rules of the Articles of Agreement, it
also focuses on administering a code of conduct for exchange rate policies and restrictions on payments for
current account transactions.
▪ Financial functions: IMF provides financial support and resources to the member countries to meet short term
and medium term Balance of Payments (BOP) disequilibrium.
▪ Consultative functions: IMF is a center for international cooperation for the member countries. It also acts as a
source of counsel and technical assistance.

IMF Quotas:
▪ IMF funds come from two major sources – Quota and Loans.
▪ Quotas which are pooled funds of member nations, generate most IMF funds.
▪ The size of a member’s quota depends on its economic and financial importance in the world.
▪ Nations with larger economic importance have larger quotas.
▪ The quotas are increased periodically as a means of boosting the IMF resources in the form of Special Drawing
Rights.

Special Drawing Rights:

▪ Special Drawing Rights (SDRs) are supplementary foreign exchange reserve assets defined and maintained by
the International Monetary Fund (IMF)
▪ SDR is not a currency, instead represents a claim to currency held by IMF member countries for which they
may be exchanged.
▪ The value of an SDR is defined by a weighted currency basket of four major currencies – the US Dollar, the
Euro, the British Pound, the Chinese Yuan and the Japanese Yen.
▪ Central bank of member countries held SDR with IMF which can be used by them to access funds from IMF in
case of financial crises in their domestic market.

Concern with Quota System:

▪ The 15th General Review of Quotas (GRQ), the most recent attempt to revise the size and composition of the
system, was to be completed by October 2017, but now extended to 2019.

283
▪ The delay was not unexpected, given the poor precedent set by the long delay in adoption in 2016 of the previous
GRQ (originally approved in 2010).
▪ That had doubled the overall size of the quotas to $659 billion (from $329 billion) while allotting an additional 6%
of quotas to the developing world.

India and IMF:

▪ International regulation by IMF in the field of money has certainly contributed towards expansion of
international trade. India has, to that extent, benefitted from these fruitful results.
▪ Post-partition period, India had serious balance of payments deficits, particularly with the dollar and other hard
currency countries. It was the IMF that came to her rescue.
▪ The Fund granted India loans to meet the financial difficulties arising out of the Indo–Pak conflict of 1965 and
1971.
▪ From the inception of IMF up to March 31, 1971, India purchased foreign currencies of the value of INR. 817.5
crores from the IMF, and the same have been fully repaid.
▪ Since 1970, the assistance that India, as other member countries of the IMF, can obtain from it has been increased
through the setting up of the Special Drawing Rights (SDRs created in 1969).
▪ India had to borrow from the Fund in the wake of the steep rise in the prices of its imports, food, fuel and
fertilizers.
▪ India wanted large foreign capital for her various river projects, land reclamation schemes and for the
development of communications.
▪ India has availed of the services of specialists of the IMF for the purpose of assessing the state of the Indian
economy. In this way India has had the benefit of independent scrutiny and advice.
▪ The balance of payments position of India having gone utterly out of gear on account of the oil price escalation
since October 1973, the IMF has started making available oil facility by setting up a special fund for the purpose.
▪ The foreign reserves started picking up with the onset of the liberalisation policies in 1991.
▪ India has occupied a special place in the Board of Directors of the Fund. Thus, India had played a creditable
role in determining the policies of the Fund. This has increased the India’s prestige in the international
circles.

Criticism:
▪ This delay is raising the question of relevance of the Bretton Woods Institutions among the developing
countries.
▪ Also at stake is the potency of the IMF in keeping up with the changed fundamental needs of developing
economies.
▪ The developing world is looking beyond the short-term crisis management tools that the IMF, as the sole
international lender of last resort, has traditionally offered them for decades now.
▪ China, for instance, with its steadily rising influence on the global economy, has grown to be the focal point
for economies seeking alternative sources of capital to fund their long-term growth needs.
▪ India announced that it is seeking $2 billion from the New Development Bank, set up by the BRICS countries in
2015 with a more equitable power structure, to fund infrastructure projects.
▪ The Asian Infrastructure Investment Bank, launched in 2014, could be an even bigger threat to the IMF’s
influence given its larger membership, lending capacity and international reach.
▪ In this environment of competition, the IMF will have to do more than just superficially tinker with its asymmetric
power structure and out-dated quota system.

Bangladesh set to overtake India in per capita GDP:

▪ Recently, the International Monetary Fund (IMF) has released its World
Economic Outlook (WEO) report.
▪ In the IMF's latest Economic Outlook, Bangladesh surpasses India in per
capita GDP.
▪ India is currently the fifth-largest economy in the world and is considered the
most developed country in South Asia. But recently, the result of the IMF's
economic outlook has come as a shocker for India.
▪ From 5 years India's per capita GDP is 25% more than Bangladesh but
now India lagged behind. Per capita GDP is obtained by dividing the GDP of
a country by the population of that country.

284
Key points of the IMF report
▪ India's economy has registered a decline of 10.3% in 2020-21 while the global economy has registered a decline
of 4.4% in the same period but Bangladesh's economy has recorded a growth of 4%.
▪ India's GDP per capita in the last five years was 24% more than the GDP of Bangladesh.
▪ As a result of the coronavirus, India's per capita GDP has fallen below Bangladesh's per capita GDP.
▪ IMF has estimated that India's per capita income will increase from Bangladesh's income in 2021 but will
decrease again by 2025.

Reasons of this situation

▪ Bangladesh's GDP has been steadily increasing since 2004. Whereas India's economy is trying to cope with the
2008 economic slowdown and reforms like demonetization and GST reforms.
▪ The economic effects of the recent coronavirus have affected India more than Bangladesh. This year, where India
was registering a decline of around 10%, the economy of Bangladesh was growing at a rate of 4%.
▪ In the last 15 years, where the population of India has grown rapidly (at a pace of about 21%), the population
of Bangladesh has increased at the rate of 18% i.e. Bangladesh has succeeded to some extent in controlling its
population.
▪ In Bangladesh, where the majority of the population is dependent on industries, the population of India is
dependent on agriculture. Along with this, in the last few years, Bangladesh has also paid special attention to the
social sector like health, hygiene.
▪ In the last few years, while India has faced trade stress from countries like China, America, trade stress on
Bangladesh is less.
▪ India is the most affected country from Covid-19, whereas Bangladesh has a bright spot in it.

World Economic Outlook

▪ WEO is a survey by the IMF that is usually published twice a year in the months of April and October.
▪ It analyses and predicts global economic developments during the near and medium term.
▪ In response to the growing demand for more frequent forecast updates, the WEO Update is published in January
and July between the two main WEO publications released usually in April and October.

IMF Reforms:
▪ IMF Quota: a member can borrow up to 200 percent of its quota annually and 600 percent cumulatively.
However, access may be higher in exceptional circumstances.
▪ IMF quota simply means more voting rights and borrowing permissions under IMF. But it is unfortunate that IMF
Quota’s formula is designed in such a way that USA itself has 17.7% quota which is higher than cumulative of
several countries. The G7 group contains more than 40% quota whereas countries like India & Russia have
only 2.5% quota in IMF.
▪ Due to discontent with IMF, BRICS countries established a new organization called BRICS bank to reduce the
dominance of IMF or World Bank and to consolidate their position in the world as BRICS countries accounts for
1/5th of World GDP and 2/5th of world population.
▪ It is almost impossible to make any reform in the current quota system as more than 85% of total votes are
required to make it happen. The 85% votes does not cover 85% countries but countries which have 85% of
voting power and only USA has voting share of around 17% which makes it impossible to reform quota without
consent of developed countries.
▪ 2010 Quota Reforms approved by Board of Governors were implemented in 2016 with delay because of
reluctance from US Congress as it was affecting its share.
▪ Combined quotas (or the capital that the countries contribute) of the IMF increased to a combined SDR 477 billion
(about $659 billion) from about SDR 238.5 billion (about $329 billion). It increased 6% quota share for
developing countries and reduced same share of developed or over represented countries.
▪ More representative Executive Board: 2010 reforms also included an amendment to the Articles of
Agreement established an all-elected Executive Board, which facilitates a move to a more representative
Executive Board.
▪ The 15th General Quota Review (in process) provides an opportunity to assess the appropriate size and
composition of the Fund’s resources and to continue the process of governance reforms.

Way Forward

285
▪ India’s share has increased to 2.75% from 2.44%, making it the 8th largest shareholder in the quota system.
▪ The quota system of is most controversial due to its asymmetric power structure.
▪ Today the world is looking towards developing countries due to their fast growing economy, but their say in IMF
is minimal.
▪ Hence considering the current economic scenario there is an urgent need to make comprehensive reforms in
the current quota system.

286
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 CH-4 BRETTON WOOD CONFERENCE
Basics and Background
▪ The United Nations Monetary and Financial Conference (1944), commonly known as Bretton Wood
conference, was held in Bretton Woods, New Hampshire, USA to regulate the international monetary and
financial order after the conclusion of World War II.
▪ The conference resulted in the agreements to set up the International Bank for Reconstruction and
Development (IBRD) popularly known as World Bank and the International Monetary Fund (IMF).The IMF
was set up to foster monetary stability at global level.
▪ The IBRD was created to speed up post-war reconstruction. The two institutions are known as the Bretton
Woods twins.

Agreements:
▪ Articles of Agreement to create the IMF, whose purpose was to promote stability of exchange rates and
financial flows.
▪ Articles of Agreement to create the IBRD (later World Bank), whose purpose was to speed reconstruction
after the Second World War and to foster economic development, especially through lending to build
infrastructure.
▪ Other recommendations for international economic cooperation.

Final Act
Within the Final Act, the most important part in the eyes of the conference participants and for the later operation of
the world economy was the IMF agreement. Its major features were:
▪ Foreign Exchange Market Rate System: Exchange rates were pegged to gold. Governments were only supposed
to alter exchange rates to correct a “fundamental disequilibrium.”
▪ Member countries pledged to make their Currencies Convertible for trade-related and other current account
transactions. The goal of widespread Current Account Convertibility did not become operative until December
1958, when the currencies of the IMF's Western European members and their colonies became convertible.
▪ As it was possible that exchange rates thus established might not be favourable to a country's Balance of
Payments position, governments had the power to revise them by up to 10% from the initially agreed level ("par
value") without objection by the IMF. The IMF could concur in or object to changes beyond that level. The IMF
could not force a member to undo a change, but could deny the member access to the resources of the IMF.
▪ All member countries were required to subscribe to the IMF's capital. Membership in the IBRD was conditioned
on being a member of the IMF. Voting in both institutions was apportioned according to formulas giving greater
weight to countries contributing more capital ("quotas").

Encouraging Open Market

▪ The seminal idea behind the Bretton Woods Conference was the notion of “open markets”.
▪ This meant countries would maintain their national interest, but trade blocs and economic spheres of influence
would no longer be their means.
▪ The second idea behind the Bretton Woods Conference was joint management of the Western political-economic
order, meaning that the foremost industrial democratic nations must lower barriers to trade and the movement
of capital, in addition to their responsibility to govern the system.

Structure of the Conference

▪ The conference conducted its major work through three "commissions."
1. Commission I dealt with the IMF and was chaired by Harry Dexter White
2. Commission II dealt with the IBRD and was chaired by John Maynard Keynes.
3. Commission III dealt with "other means of international financial cooperation" and was chaired by Eduardo
Suárez,

Post-World War Monetary Order

287
▪ The need for post-war Western economic order was resolved with the agreements made on monetary
order and open system of trade at the Bretton Woods Conference (1944).
▪ These allowed for the synthesis of Britain's desire for full employment and economic stability and the United
States' desire for free trade.
▪ The Bretton Woods system of pegged exchange rates lasted into the early 1970s.

IMF
▪ The International Monetary Fund, a UN specialised agency, was established under the
Bretton Woods Agreement in 1944 along with the World Bank. It has 187 members
(2011).
▪ It is headquartered in Washington and its Managing Director is Christine Lagarde. It
started functioning in 1947.

IMF objectives
▪ To promote international monetary cooperation
▪ To facilitate balanced growth of international trade for the economic growth of all
member countries
▪ To promote exchange rate stability; maintain orderly exchange rate arrangements; and to avoid competitive
exchange rate revaluation
▪ To help members in times of balance of payments crisis.

SDRs
▪ The SDR is an international reserve asset, created by the IMF in 1969 to supplement its member countries’
official reserves. Its value is based on a basket of four key international currencies- dollar, euro, yen and pound.
SDRS can be exchanged for national currencies.
▪ SDR is neither a currency, nor a claim on the IMF. Rather, it is a potential claim on the freely usable currencies
of IMF members. Holders of SDRs can obtain these currencies in exchange for their SDRs.

World Bank Group and World Bank

▪ The World Bank Group (WBG) is a family of five international
organizations that gives loans, generally to poor and LDC countries. The
Bank came into existence in 1945 following international ratification of the
Bretton Woods agreements, which emerged from the United Nations
Monetary and Financial Conference (1944).
▪ It is responsible for the preparation of the “World Development Report”.
Commencing operations in 1946, it began operations for post-war
reconstruction. Its current role is different as it focuses on lending to and
develop the poor countries and help fight poverty in all its facets.
▪ The Group’s headquarters are in Washington. It is an international
organization owned by member governments; although it makes profits,
these profits are used to support continued efforts in poverty escalation.
▪ Technically the World Bank is part of the United Nations system, but its governance structure is different:
each institution in the World Bank Group is owned by its member governments, which subscribe to its basic share
capital, with votes proportional to shareholding. Membership gives certain voting rights that are the same for all
countries but there are also additional votes which depend on financial contributions to the organization.

Agencies of World Bank

1. International Bank for Reconstruction and Development (IBRD)
2. International Development Association (IDA)
3. International Finance Corporation (IFC)
4. Multilateral Investment Guarantee Agency (MIGA)
5. International Centre for Settlement of Investment Disputes (ICSID)

288
 CH-5 WORLD TRADE ORGANISATION (WTO)
Basics and Background:
▪ WTO is an international organization set up in 1995 by replacing the General
Agreement on Trade and Tariffs (GATT) under the Marrakesh Agreement.
▪ It is the only global international organization dealing with the international Trade
between nations.
▪ Its HQ is located in Geneva, Switzerland.
▪ Currently, WTO has 164 members and India is a founding member of WTO.
▪ Currently, the head (Director-General) of WTO is Roberto Azevedo.

Objective:
▪ To formulate and implement rules for international trade.
▪ To provide a platform for negotiating and monitoring further trade liberalization.
▪ To provide a platform for the settlement of disputes.
▪ Providing assistance to the developing, least-developed and low-income countries in transition to adjust to
WTO rules and disciplines through technical cooperation and training.
▪ To cooperate with the other major economic institutions (like UN, World Bank, IMF etc.) involved in global
economic management.

Principles of WTO:
▪ Non-Discrimination
▪ Most Favored Nation - All nations should be treated equally. No one country can grant any other member
country any special favour. For example, if one country lower tariff to one country then it has to be lowered to all
other member countries.
▪ National Treatment- Same treatment to all products, either local or foreigners. Fair and equal treatment is given
to local as well as the products imported from other countries.
▪ Reciprocity - Lowering of import duties and other trade barriers in return for similar concessions from another
country.
▪ Predictability through Binding and enforceable commitments - To make the business environment stable and
predictable.
▪ Transparency - The WTO members need to publish their trade regulations and to notify changes in trade policies
to the WTO.
▪ Encouraging Development and Economic Reforms - All efforts are made by the WTO system to contribute to
development.

Important Trades Agreements of WTO:

▪ Agreement on Agriculture (AoA),
▪ Agreement on TRIPS (Trade-Related Aspects of Intellectual Property Rights),
▪ Agreement on the Application of Sanitary and Phytosanitary Measures (SPS),
▪ Agreement on Technical Barriers to Trade (TBT),
▪ Agreement on Trade-Related Investment Measures (TRIMS),
▪ General Agreement on Trade in Services (GATS) etc.

Agreement on Agriculture (AoA):

▪ It was negotiated during the Uruguay Round of the GATT and was concluded with the establishment of the
WTO in 1995.
▪ Through AoA, WTO aims at reforming trade in agriculture with a fair and market-driven system.
▪ The Agreement allows governments to support their rural economies, but only allowed those policies that cause
less trade “distortions”.
▪ This agreement has fixed commitments from all member states on the following three agricultural supply chain
system:-

289
▪ Improving Market access– This can be done by removing various trade barriers by the member states. By fixing
the tariffs and progressively promoting free trade among member states which will ultimately lead to an increase
in market access.
▪ Domestic Subsidies- It basically motivates for the reduction in domestic subsidies that distorts free trade and fair
prices. This is based on the premise that not all subsidies distort trade to the same extent. Under this agreement,
Subsidies can be categorized into the following three boxes –

Green Box All those subsidies that do not distort trade or causes minimal distortion, comes under the
green box. E.g. All government services such as research, disease control, and infrastructure
and food security. Also, all those subsidies are given to the farmers that directly do not affect
international trade also comes under the green box.
Amber Box All kinds of domestic subsidies or support that can distort production and trade (with
some exceptions) fall into the Amber Box. The measures to support prices come under this
box. The exception is the provision that accepts subsidies upto 5% of agricultural production
for developed countries, 10% for developing countries.
Blue Box All those Amber Box subsidies which tend to limit the production comes under Blue Box.
This can be increased without limit as long as subsidies are linked to production-limiting
programs.
Export subsidies: All those subsidies that make the export of agricultural products cheaper are called export
subsidies. These are basically presumed to have trade-distorting effects. This agreement prohibits the use of
export subsidies by the member states for agriculture products.

MOST FAVOURED NATION

▪ Most Favoured Nation is a treatment accorded to a trade partner to ensure non-discriminatory trade
between two countries vis-a-vis other trade partners.
▪ The importance of MFN is shown in the fact that it is the first clause in the General Agreement on Tariffs and
Trade (GATT). Under WTO rules, a member country cannot discriminate between its trade partners. If a special
status is granted to a trade partner, it must be extended to all members of the WTO.

The Council for Trade-Related Aspects of Intellectual Property Rights (TRIPS Council):
▪ It monitors implementation of the Agreement on Trade-Related Aspects of Intellectual Property Rights (the
TRIPS Agreement).
▪ It provides a forum in which WTO Members can consult on intellectual property matters, and carries out the
specific responsibilities assigned to the Council in the TRIPS Agreement.
▪ The TRIPS Agreement:
o Sets the minimum standards of protection for copyrights and related rights, trademarks, geographical
indications (GIs), industrial designs, patents, integrated circuit layout designs, and undisclosed
information.
o Establishes minimum standards for the enforcement of intellectual property rights (IPRs) through civil
actions for infringement, actions at the border,
o At least in regard to copyright piracy and trademark counterfeiting, in criminal actions.

Ministerial Conferences (MC):

MC Place Year Details

MC1 Singapore 1996 Ministers of finance, trade, foreign, and agriculture from more than 120
countries participated and the following issues were in discussion:
1. trade and investment
2. trade facilitation
3. transparency in government procurement
4. trade and competition
These are known as the Singapore Issues.
MC2 Geneva, 1998 ▪ Discussions on the implementation of Singapore Issues.
Switzerland ▪ Further discussions for the next round related to Export subsidies,
market access, etc.

290
 MC3 Seattle, USA 1999 ▪ The Uruguay Round was discussed.
▪ Further discussions on agricultural and services mandated at the
last Ministerial.
▪ The Ministerial Conference ended without a conclusion though.
MC4 Doha, Qatar 2001 The Doha Round was discussed.
MC5 Cancún, Mexico 2003 Discussions on the progress of the Doha Development Agenda and
other negotiations from the last Ministerial.
MC6 Hong Kong 2005 ▪ Discussions on aiming to conclude the Doha Round by 2006.
▪ Adoption of the ‘Swiss Formula’ to cut down tariffs on non-
agricultural goods (NAMA) by both developed and developing
countries with different coefficients.
MC7 Geneva, 2009 ▪ This meeting didn’t revolve around the Doha Round.
Switzerland ▪ Ministers discussed various other ideas for further development.
▪ The theme of MC7 was ‘The WTO, the Multilateral Trading
System and the Current Global Economic Environment’
MC8 Geneva, 2011 ▪ Discussions on multiple topics for least developed nations and
Switzerland trade policy reviews.
▪ WTO approved Montenegro, Russian Federation, and Samoa
accessions.
▪ Doha Round was discussed to make the mandate more effective,
operational, and precise.
MC9 Bali, Indonesia 2013 The ‘Bali Package’ was adopted by the WTO that aimed at the
following points:
1. Boosting trade in the least developed countries (LDCs)
2. Higher food security provisions for developing countries
3. Streamlining trade
4. The Bali Package is a selection of issues from the broader Doha
Round negotiations.
Yemen became a part of WTO.
MC10 Nairobi, Kenya 2015 Discussion on agriculture, cotton, and issues of LDCs.
The Nairobi Package was adopted by WTO that delivered beneficial
commitments to WTO’s poorest members.
MC11 Buenos Aires, 2017 Discussions on e-commerce duties, fisheries subsidies, and other
Argentina commitments to negotiations in all sectors.
MC12 Nur-Sultan, 2020 The WTO members have agreed that the organization’s Twelfth
Kazakhstan Ministerial Conference (MC12) will take place in June 2020 in
Kazakhstan, which joined the WTO in 2015.

Doha Declaration:
The Doha Declaration is the November 2001 declaration that came out of the 4th Ministerial Conference of the WTO,
that took place in Doha, Qatar.
▪ This declaration gives the mandate for negotiations on an array of topics including issues concerning the
implementation of the previous agreements.
▪ This is called the Doha Declaration on the TRIPS Agreement and Public Health.
▪ There were disagreements between developed and developing countries.
▪ The major bones of contention were agriculture, non-tariff trade barriers, industrial tariffs, services, and trade
remedies.
▪ The Bali Ministerial Declaration was achieved in 2013 which is the first agreement under the Doha Round, and
also the first unanimous agreement under WTO.

USA and India at WTO:

▪ India has won a major trade dispute against the US at the World Trade Organization (WTO), with a dispute
settlement panel.

291
▪ India had claimed that the Domestic Content Requirements and subsidies instituted by the governments of the
eight states of the US in the energy sector violated several provisions of the Trade-Related Investment Measures
(TRIMs) Agreement and Subsidies and Countervailing Measures Agreement.
▪ India brought this dispute to the WTO in 2016.
▪ The same year, the US had won a case at WTO against India's solar power policies, claiming that policies had
resulted in a 90% reduction of U.S. solar exports to India.
▪ The panel pronounced that subsidies and mandatory local content requirements instituted by eight American states
(Washington, California, Montana, Massachusetts, Connecticut, Michigan, Delaware and Minnesota) breached
global trade rules.
▪ The panel found that all the US state measures at issue are inconsistent with GATT 1994 (Article III-National
Treatment) because they provide an advantage for the use of domestic products, which amounts to less
favourable treatment for similar imported products.

WTO’s Appellate Body

▪ The Appellate Body, set up in 1995, is a standing committee of seven members that presides over appeals against
judgments passed in trade-related disputes brought by WTO members.
▪ Countries involved in a dispute over measures purported to break a WTO agreement or obligation can approach
the Appellate Body if they feel the report of the panel set up to examine the issue needs to be reviewed on points
of law. Existing evidence is not re-examined; legal interpretations are reviewed.
▪ The Appellate Body can uphold, modify, or reverse the legal findings of the panel that heard the dispute.
Countries on either or both sides of the dispute can appeal.
▪ The WTO’s dispute settlement procedure is seen as being vital to ensuring smooth international trade flows.
▪ The Appellate Body has so far issued 152 reports. The reports, once adopted by the WTO’s disputes settlement
body, are final and binding on the parties.

WTO Appellate Body on Shaky Ground

▪ Over the last two years, the membership of the body has dwindled to just three persons instead of the
required seven.
▪ The understaffed appeals body has been unable to stick to its 2-3 month deadline for appeals filed in the last few
years, and the backlog of cases has prevented it from initiating proceedings in appeals that have been filed in the
last year.
▪ With the Appellate Body unable to review new applications, there is already great uncertainty over the WTO’s
dispute settlement process.
▪ If the body is declared non-functional, countries may be compelled to implement rulings by the panel even if they
feel that gross errors have been committed.
▪ Should such a country refuse to comply with the order of the panel on the ground that it has no avenue for
appeal, it will run the risk of facing arbitration proceedings initiated by the other party in the dispute.

USA has crippled functioning the WTO:

▪ The smooth and effective functioning of the Appellate Body, which is regarded as the jewel in the crown, has
posed hurdles to the U.S. for adopting unilateral measures.
▪ Several U.S. provisions for imposing countervailing and anti-dumping measures were found to be inconsistent
with core provisions of the WTO agreements.
▪ Finally, the U.S. chose to spike the Appellate Body by resorting to starving funds for its functioning as well as
blocking the selection process for filling six vacancies.
▪ Consequently, the Appellate Body is left with only one member, who will not be able to deliver any rulings on the
pending trade disputes.
▪ A minimum of three members are required to adjudicate any dispute.

India’s Role:
▪ As the U.S. loses interest in multilateralism in trade, India should actively try to arrest the organisation’s
slide
▪ India should be more actively engaged to make the WTO a more equitable organisation.
▪ India needs to work on persuading all members of the WTO to return to the table and negotiate on issues like
agriculture, industrial tariffs, and services.
▪ India’s positions have much in common with the African nations’ stand; we have to build bridges with Africa.

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▪ India needed to quickly forge a larger alliance to counter the moves that are against India’s interests.
▪ India’s journey towards achieving 5 Trillion Dollar Economy is not possible without expansion of our basket
of global trade.

Dispute Panels against India:

▪ Recently, the Dispute Settlement Body (DSB) of the World Trade Organisation (WTO) has set up two dispute
settlement panels targeting import duties imposed by India on a number of Information and Communication
Technology (ICT) products including mobile phones.
▪ It was done on the request of Japan and Taiwan, taking up the number of panels constituted to examine the
same tariff-related issue to three.
▪ In June 2020, the European Union (EU) had a panel established against India on the same issue.
▪ The panels would determine whether India’s customs duties on imports of certain ICT products infringe the
WTO’s norms or not.
▪ The panels have been set up to decide on 20% customs duty levied by India on mobile phones and some other
ICT products.

India’s Stand:
▪ India managed to block Japan’s first request for a panel on the grounds that the complaint undermined India’s
sovereignty.
▪ India also rejected the EU’s suggestion of agreeing to one consolidated panel combining complaints from all
three of them and saving time and resources.
▪ India argued that all three complainants are seeking to get the country to take on commitments under the
Information Technology Agreement-II (ITA-II) which it never agreed to.

India’s trade concerns and WTO:

▪ Tariff on Steel and Aluminum – Recently the USA govt imposed 10% tariff on aluminum and 25% tariff on
steel against various trade partners. India wants that it should be removed or it will raise the issue in WTO.
▪ Export Subsidy Issue – Recently USA dragged India to WTO and raised concern on the export subsidy regime
provided to the Indian companies in the form of SEZ, MEIS, EPCG, etc. USA argues that as India’s Per Capita
Income has increased from $ 1000, India can’t use the export subsidy regime as per the ASCM.
▪ Agricultural subsidies - The present quota of subsidies is based on the price levels of 1986-88. Presently the
minimum support price (MSP) concept which provides subsidies to the farmers in India falls under the Amber
box. It can directly affect India’s food security program. India wants that it should be at the current price level and
the amber box concept should be done away with. However, through a ‘peace clause’ agreed to during the Bali
conference allows India to carry on with its PDS program as of now. But the developed member states are not
taking any steps for permanent solution of this problem.
▪ Special and Differential Treatment (SDT) - During Doha round, member states agreed to provide favourable
treatment to developing nations. However, developed countries are denying the emerging economies such as India
and China as unworthy of this provision.
▪ Issues related to intellectual property rights – The issues of compulsory licensing of medicines have been
resolved through TRIPS. However, the developed nations are trying to push for TRIPS+ commitments.

Challenges:
▪ Dispute settlement cases continue to be filed for the time being and are being litigated. A civil dialogue over
trade issues persists.
▪ Technical functioning is now wholly inadequate to meet the major challenges to the strategic relevance of the
WTO in the 21st century. In critical areas, the organisation has neither responded, nor adapted, nor delivered.
▪ Dimensions of its structures and functions are fragile, creaking, and failing in parts.
▪ Functioning of state enterprises engaging in commercial activities is interfering with and distorting the
operative assumption of the General Agreement on Tariffs and Trade (GATT)/WTO that international trade
is to be conducted, principally, by private sector operators in response to conditions of supply and demand through
price in a market economy.
▪ Many WTO members bear responsibility for the use of trade-distorting domestic subsidies. Agricultural and
industrial subsidies have caused blockages in the system and prompted protectionist reactions in a number of
WTO members.

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▪ Blockage and deadlock in the Appellate Body stage of the WTO dispute settlement system triggered the present
crisis.
▪ The WTO lost the critical balance between the organisation as an institution established to support,
consolidate, and bind economic reform to counter damaging protectionism, on the one hand, and the
organisation as an institution for litigation-based dispute settlement, on the other hand.
▪ For years now, the multilateral system for the settlement of trade dispute has been under intense scrutiny
and constant criticism. The U.S. has systematically blocked the appointment of new Appellate Body members
(“judges”) and de facto impeded the work of the WTO appeal mechanism.
▪ Growing protectionism: Over the past two years, governments have introduced trade restrictions covering a
substantial amount of international trade — affecting $800 billion in global imports in the past year alone. WTO
has been less affective in addressing them, including US China trade war. This raised questions over WTO’s
credibility.
▪ WTO has played a very limited role in helping address other global issues related to trade, such as food security,
climate change and global trade imbalances.
▪ Doha Development Round focused on reducing important trade barriers in sectors, such as agriculture, industrial
goods and services. However, after a decade of talks, it still remains to be concluded.

Way Forward:
▪ A vibrant WTO cannot accommodate conflicting economic models of market versus state. All WTO members
will have to accept the operative assumption of a rules-based order steered by a market economy, the private
sector, and competition.
▪ Launch negotiations to address the intertwined issues of agricultural subsidies and market access, while
recognising that food security concerns will not disappear.
▪ A credible trading system requires a dispute settlement system that is accepted by all.
▪ Launch serious negotiations to restore the balance, and it must be done in an open-ended plurilateral manner that
cannot be blocked by those who do not want to move ahead.
▪ GATT/WTO rules in a number of areas are outdated. New rules are required to keep pace with changes in
the market and technology. Rules and disciplines on topics ranging from trade-distorting industrial subsidies to
digital trade require updates.
▪ A reaffirmed commitment to the rules-based liberal market order with a development dimension must be the
foundational starting point.

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 CH-6 ORGANISATION FOR ECONOMIC CO-OPERATION
AND DEVELOPMENT (OECD)
Basics and Background:

▪ OECD originated in 1948, as the Organisation for European Economic Co-operation (OEEC). OEEC was
renamed as the OECD in 1961 when the USA and Canada joined to reflect a broader membership.
▪ Reformed in subsequent years as OECD by the Convention on the Organisation for Economic Co-operation
and Development.
▪ Most OECD members are high-income economies with a very high Human Development Index (HDI) and are
regarded as developed countries. OECD members are democratic countries that support free-market economies.
▪ The OECD member states collectively comprised 62.2% of global nominal GDP (US $49.6 trillion) and 42.8%
of global GDP (Int $54.2 trillion) at purchasing power parity (PPP) in 2017.
▪ OECD is known as a statistical agency, as it publishes comparable statistics on a wide number of subjects.
▪ OECD is an official United Nations Observer.

Objectives:
The objectives of the OECD include fostering economic development and cooperation and fighting poverty
through the promotion of economic stability.
▪ To promote policies that will improve the economic and social well-being of people around the world.
▪ Over the years, OECD has raised the standards of living in multiple countries.
▪ To stimulate economic progress and world trade.
▪ To provide a forum of countries describing themselves as committed to democracy and the market economy.
▪ To provide a forum in which governments can work together to share experiences and seek solutions to
common problems.

Focus Area:
▪ Restore confidence in markets and the institutions that make them function.
▪ Re-establish healthy public finances as a basis for future sustainable economic growth.
▪ Foster and support new sources of growth through innovation environmentally friendly “Green Growth”
strategies and the development of emerging economies.
▪ Ensure that people of all ages can develop the skills to work productively and satisfyingly in the jobs of
tomorrow.
▪ The OECD also maintains a “blacklist” of nations that are considered uncooperative tax havens.
▪ It also took efforts to eradicate tax avoidance by profitable corporations and in the G-20 countries. It also
encourages the G-20 countries to promote tax reforms.

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Members:
▪ Most OECD members are high income economies with a very high Human Development Index (HDI) and are
regarded as developed countries.
▪ 36 member countries along with emerging countries like Mexico, Chile and Turkey.
▪ The European Commission participates in the work of the OECD alongside the EU member states.

Secretariat:
▪ Exchanges between OECD governments benefit from the information, analysis, and preparation of the OECD
Secretariat.
▪ The secretariat collects data, monitors trends, and analyses and forecasts economic developments.
▪ Under the direction and guidance of member governments, it also researches social changes or evolving patterns
in trade, environment, education, agriculture, technology, taxation, and other areas.

Committees:
▪ Representatives of member and observer countries meet in specialized committees on specific policy areas, such
as economics, trade, science, employment, education or financial markets.
▪ There are about 200 committees, working groups and expert groups.
▪ Committees discuss policies and review progress in the given policy area.

Specialized Bodies:
▪ Africa Partnership Forum (APF)
▪ Business and Industry Advisory Committee (BIAC)
▪ Development Assistance Committee (DEC)
▪ OECD Development Centre
▪ International Transport Forum (ITF) (formally known as the European Conference of Ministers of Transport)
▪ International Energy Agency (IEA)
▪ Nuclear Energy Agency (NEA)
▪ Multilateral Organisation Performance Assessment Network (MOPAN)
▪ Partnership for Democratic Governance (PDG)
▪ Sahel and West Africa Club
▪ Trade Union Advisory Committee (TUAC)

PISA:
▪ The OECD administers and publishes the Programme for International Student Assessment (PISA)
▪ A regular assessment of the attainment of 15-year olds in three areas of knowledge.
▪ PISA is the only international education survey to measure the knowledge and skills of 15-year-olds, an age
at which students in most countries are nearing the end of their compulsory time in school.
▪ PISA is also unique in the way it looks at:
1. Public policy issues.
2. Literacy.
3. Lifelong learning.

India ends PISA Boycott:

▪ India and Organisation for Economic Co-operation and Development (OECD) has
signed an agreement to enable India’s participation in Programme for International
Students Assessment (PISA) to be held in 2021.
▪ India has participated in the PISA test only once before, in 2009.
▪ India stayed away from PISA in 2012 and 2015 on account of its dismal
performance in 2009, when it was placed 72nd among the 74 participating countries.
▪ India criticized the method saying that questions were "out of context”. Thus, India chose not to participate in
the 2012 and 2015 cycle of PISA.

Important features of India’s participation in PISA:

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▪ Schools run by Kendriya Vidyalaya Sangathan (KVS), Navodaya Vidyalaya Samiti (NVS) and schools in the
UT of Chandigarh will participate.
▪ PISA uses test items aligned with international benchmarks. OECD has agreed to contextualize the questions
for Indian students.
▪ Learnings from participation in PISA will help to introduce competency-based examination reforms in the
school system and help move away from rote learning. The CBSE and NCERT will be part of the process and
activities leading to the actual test.
▪ It would lead to recognition and acceptability of Indian students and prepare them for the global economy in
the 21st century.

Reports:
▪ OECD Economic Outlook
▪ OECD Communication Outlook
▪ OECD Internet Economy Outlook

India and OECD:

▪ India is not a member of OECD.
▪ India became the 27th member of the OECD’s Development Centre.
▪ India has had a co-operation programme with the OECD since 1997.
▪ The OECD Council at Ministerial level adopted a resolution on 16 May 2007 to strengthen co-operation
with India, as well as with Brazil, China, Indonesia and South Africa, through a programme of enhanced
engagement, defining these countries as Key Partners of the OECD.
▪ As a Key Partner, India is included in OECD analysis and statistical databases.
▪ Its participation in OECD bodies and fora is encouraged as a means of allowing Indian policy makers to benefit
from the OECD’s technical expertise and analytical capacity.

Mutual Benefits:
▪ OECD statistics, sector-specific country reviews and targeted joint activities are key to advancing India’s
domestic reform agenda while increasing the OECD’s relevance in global governance.
▪ This interaction also benefits OECD members and other Key Partners’ engagement with India as a major
player in the global economy. At fora like the G20, this dialogue supports a coordinated approach to addressing
pressing policy challenges through leveraging the Organisation’s policy advice.

Areas of work:
▪ OECD-India collaboration continues to build, in areas such as anti-corruption, corporate
governance, economic policy, environment, fiscal relations, as well as, responsible business
conduct, steel, taxation, trade and investment.

India’s Participation in OECD General Activities:

▪ India participates in selected OECD Committees and their subsidiary bodies. India is also a member of
the Development Centre, the Global Forum on Transparency and Exchange of Information for Tax
Process, the International Transport Forum, the Financial Action Task Force, and an Association Country
of the International Energy Agency. Engagement in the G20 context includes India’s active role in the Global
Forum on Steel Excess Capacity and its adherence to the G20/OECD Principles of Corporate Governance.
▪ Indian ministers and officials have also attended the OECD Ministerial Council Meetings.

India designated Vice-Chair of OECD Working Group on GLP:

▪ India has been designated the ‘Vice-Chair’ of Good Laboratory Practice (GLP) Working Group of the
Organisation for Economic Co-operation and Development (OECD), recognizing the contribution of the
Indian GLP programme.
▪ Good Laboratory Practice (GLP) is a quality system, which has been evolved by Organisation for Economic Co-
operation and Development (OECD) to ensure that safety data generated on various chemicals like industrial
chemicals, pharmaceuticals (Human and Veterinary), agrochemicals, cosmetic products, food/ feed
additives, and medical devices, etc., can be relied upon by regulatory authorities.

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 CH-7 ORGANISATION OF THE PETROLEUM
EXPORTING COUNTRIES (OPEC)
Basics and Background:
▪ The Organization of the Petroleum Exporting Countries
(OPEC) is a permanent, Intergovernmental
Organization, created at the Baghdad Conference held
at Iraq in 1960 by Iran, Iraq, Kuwait, Saudi Arabia and
Venezuela.
▪ It initially had its headquarters in Geneva, Switzerland
which was then moved to Vienna, Austria in 1965.
▪ It accounts for an estimated 44 percent of global oil
production and 81.5 percent of the world's "proven"
oil reserves.

Objective
▪ Coordinate and unify petroleum policies among Member Countries
▪ In order to secure fair and stable prices for petroleum producers
▪ The efficient, economic and regular supply of petroleum to consuming nations
▪ A fair return on capital to those investing in the industry

Member
▪ Currently, the Organization has a total of 13 Member Countries – Algeria, Angola, Congo, Equatorial Guinea,
Gabon, Iran, Iraq, Kuwait, Libya, Nigeria, Saudi Arabia, United Arab Emirates, and Venezuela.
▪ Qatar terminated its membership on 1 January 2019. Ecuador suspended its membership in December 1992,
rejoined OPEC in October 2007, but decided to withdraw its membership of OPEC effective 1 January 2020.
Functions of OPEC:

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▪ Review the status of the international oil market and the forecasts for the future in order to agree upon
appropriate actions which will promote price stability in the oil market.
▪ Decisions about matching oil production to expected demand are taken at the meeting of the OPEC conference.
▪ Provides research and administrative support to the secretariat body that disseminates news and information to the
world at large.

OPEC and Russia:

▪ Russia happens to be the 3rd largest supplier of Oil in the world (12% of all oil produced).
▪ This means they too have considerable influence in controlling the global oil supply.
▪ And back in 2017, OPEC and Russia started colluding informally to cut production and prop up prices. This
came against the backdrop of oil having made some terrible lows.
▪ So two big parties come together to keep prices stable and it obviously helped.

OPEC+
▪ The non-OPEC countries which export crude oil along with the 14 OPECs are termed as OPEC plus countries.
▪ OPEC plus countries include Azerbaijan, Bahrain, Brunei, Kazakhstan, Malaysia, Mexico, Oman, Russia,
South Sudan and Sudan.
▪ Saudi and Russia, both have been at the heart of a three-year alliance of oil producers known as OPEC Plus,
which now includes 11 OPEC members and 10 non-OPEC nations that aims to shore up oil prices with
production cuts.

INTERNATIONAL ENERGY AGENCY

▪ The International Energy Agency (IEA) is an autonomous organisation which works to ensure reliable, affordable
and clean energy.
▪ It was established in the wake of 1973 (set up in 1974) oil crisis after the OPEC cartel had shocked the world
with a steep increase in oil prices.
▪ It is headquartered in Paris, France
▪ The IEA has four main areas of focus, i.e. 4Es:
1. Energy security,
2. Economic development,
3. Environmental awareness
4. Engagement worldwide.
▪ India became an associate member of the International Energy Agency in 2017.

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▪ Mexico officially became the International Energy Agency’s 30th member country in February 2018, and its first
member in Latin America.

Qatar quit OPEC:

▪ Qatar recently announced that it was walking away from the
Organisation of the Petroleum Exporting Countries (OPEC).
▪ Qatar is a small oil producer which accounts for less than 2 percent of
total oil output, so its departure may not have a significant impact on
the oil market.

Reason behind Qatar’s Decision:

▪ Qatar is among the world’s smallest countries by area.
▪ However, it is the richest in terms of per capita gross national income
($128,000 according to World Bank figures).
▪ Qatar’s riches are due to its natural gas reserves, and it is the world’s
largest exporter of liquefied natural gas (LNG).
▪ So it wanted to focus on its gas industry rather than on oil, in which it
was in any case a small player.
▪ It denies any political reasons for leaving OPEC.
▪ However, Qatar's broken diplomatic relationship with Saudi Arabia is to be noted.
▪ Notably, Saudi Arabia plays a dominant role in the OPEC, having pumped 11 million barrels per day in
October, 2018.
▪ So Qatar feels it was pointless to put efforts, resources and time in an organisation that it was a very small
player in.

Why is Qatar’s Regional Relations Strained?

▪ Qatar has long showed an independent mind in foreign policy.
▪ This includes having a close economic and diplomatic relationship with Shia Iran, Sunni Saudi’s great regional
rival.
▪ This stance does not always align with the priorities of its regional Arab neighbours.
▪ In June, 2017, Saudi Arabia, UAE, and Bahrain cut ties with Qatar.
▪ They directed Qatari citizens to leave within 14 days, and forbade their citizens from going to or staying in Qatar.
▪ Egypt too severed diplomatic contact with Qatar.
▪ All of these countries shut their airspace to Qatari aircraft, and told foreign airlines to seek permission if flying to
and from Qatar.
▪ Saudi also sealed Qatar’s only land border, and closed its ports to Qatari-flagged ships.
▪ It claimed Qatar had refused to end ties with “terrorists”, after Doha declined to fulfil 13 demands that were
presented to it.
▪ It included:
o Cutting diplomatic relations with Tehran and military ties with Turkey
o Shutting down the TV station Al Jazeera
o Aligning with other Arab countries “militarily, politically, socially and economically”
▪ But Qatar said the demands amounted to surrendering their sovereignty, which it would never do.
▪ It has backed the Muslim Brotherhood and Hamas, but it is also part of the US-led war on the Islamic State.
▪ It has assisted the rebels fighting Bashar al-Assad’s regime in Syria.
▪ Over the last year and a half, hopes of reconciliation of Qatar with its neighbourhood have dimmed.
▪ Doha has only deepened its cooperation with Iran and Turkey, and with political Islamist organisations.

How will Qatar's Decision Impact Global Oil Prices?

▪ Qatar is a tiny player that pumped only 2% of OPEC’s total output of 32.9 million barrels per day.
▪ It has limited influence on OPEC’s pricing decisions and so the exit would not make a much impact in terms of
global oil prices.
▪ However, over the last many decades, it has played a role mediating internal rivalries in OPEC.
▪ It helped strike production-cut deals with producers like Russia.
▪ So in these areas, Qatar's absence may hurt OPEC slightly.

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▪ India - Qatar's position as the world’s top LNG exporter and an influential player in the global LNG market
is important for India.
▪ Qatar is one of India’s oldest LNG suppliers, with Petronet LNG among the companies that have contracted to
buy LNG from Qatar.
▪ But LNG pricing is not in OPEC’s domain, so Qatar’s decision is unlikely to impact these trends.

OPEC+ Decides Combine Slashing Of Crude Oil Production:

▪ The global economy, grappling with the COVID-19 pandemic, is now faced with an energy war, resulting
in crashing of crude oil prices in the international market.
▪ After many talks OPEC and Russia finally agreed upon a huge production cut amounting to 10% of Global
Oil supply.
▪ This is an unprecedented agreement because it’s not just between OPEC and OPEC+, but it also found support
among the U.S. that is the biggest Oil supplier in the world, and other G-20 countries too.
▪ India has made a case for affordable oil prices in the backdrop of the Organization of the Petroleum Exporting
Countries-plus (OPEC+) combine slashing production amid the COVID-19 pandemic.
▪ OPEC accounts for around 40% of global production.
▪ The OPEC accounts for 80% of India’s crude oil imports.
▪ Any production cut by the OPEC plus arrangement impacts India’s energy security efforts in the short run.

NORD STREAM 2
▪ It is a gas pipeline project with a purpose to bring Russian gas
under the Baltic Sea direct to Germany.
▪ The decision to build Nord Stream 2 was taken after the success
of building and operating the first Nord Stream gas pipeline.
▪ It will also facilitate reliable supply of Russian gas to Europe.

Impact on India:
▪ India, which is one of the major OPEC consumers, has always stood for a global consensus on responsible
pricing.
▪ Indian refiners have cut production as the lockdown has led to a sharp decline in demand for transportation
fuels.
▪ Demand for domestic cooking gas has, however, increased as more people stay indoors during the lockdown
aimed at containing the spread of the coronavirus.
▪ However, Saudi Arabia has agreed to supply crude oil at lower rates to refiners in India and China, two
primary customers.
▪ For India, it comes as a respite given the fact that it is the world’s third-largest importer of crude oil and
the fourth largest importer of LNG.
▪ India saves ₹10,700 crores for every $1 drop in prices, this may help manage the Current Account Deficit
(CAD).

India wants OPEC to fix Asian Oil Pricing Anomaly:

▪ India in virtual OPEC-India Dialogue meeting expressed that, India wants OPEC to review its pricing policies
for the Asian market and end the premium it puts on its crude for Asia.
▪ India urged OPEC about the urgency and need to address the historical aberration in crude pricing for Asia by
ending Asian Premium recognizing the shifting of demand for crude oil to Asia, which is further accelerated by
Covid-19 pandemic
▪ Previously India also tried to coordinate with China and other Asian countries to raise voice against the
“Asian premium” being charged by OPEC.
▪ Both sides drew attention to the close cooperation and engagement in many projects and investments between
OPEC Member Countries and India, and other topical issues were addressed, including the Asian Premium and
term contracts

Why countries, including India, are against Asian Premium?

▪ India, which sources 85% of its crude oil supplies from OPEC member countries, wants producers to offer
discounts rather than charge a premium, as today it has become buyer’s market.

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▪ The direction of crude flow from West Asia has now shifted to Asia. Besides, with OPEC deciding not to
reduce production, there is a tilt in the demand-supply balance.
▪ Earlier, crude flow was from West Asia to North America and the pricing also depended on the market. Now,
with the shale revolution, the flow has shifted to Asia.

ASIAN PREMIUM
▪ It is the extra charge being collected by OPEC countries from Asian countries when selling oil.
▪ It has roots in the establishment of market oriented crude pricing in 1986.
▪ There are 3 important benchmarks in global market, representing the cost of oil produced in respective
geographies.
1. Brent: Light sweet oil representative of European market
2. West Texas Intermediate(WTI): US market
3. Dubai/Oman: Middle East and Asian Market.
▪ However, US and Europe had an advantage because their markets and prices were based on future trading and
reflected every trend in the crude market. On the other hand, Asia represented by Dubai/Oman do not have any
derivative trading, doesn’t have that edge.
▪ Hence, price charged from Asian countries remained $1-$2 dollar higher than that from Europe and the US.
This price differential is termed as ‘Asian Premium’.

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 CH-8 INTERNATIONAL COURT OF JUSTICE
Basics and Background:
▪ The International Court of Justice (ICJ) is the principal judicial organ of
the United Nations (UN). It was established in June 1945 by the Charter of the
United Nations and began work in April 1946.
▪ Article 33 of the United Nations Charter lists the negotiation, enquiry,
mediation etc. methods for the pacific settlement of disputes between States.
Some of these methods involve the services of third parties.
▪ The evolution of modern international arbitration:
o The Jay’s Treaty of 1794 between the United States of America and Great
Britain.
o The Alabama Claims arbitration in 1872 between the United Kingdom
and the United States.
o The Hague Peace Conference of 1899, convened on the initiative of the
Russian Czar Nicholas II
▪ With respect to arbitration, the 1899 Convention provided for the creation of permanent machinery, known as the
Permanent Court of Arbitration, established in 1900 and began operating in 1902.
▪ Various plans and proposals submitted between 1911 and 1919, both by national and international bodies and by
governments, for the establishment of an international judicial tribunal, which culminated in the creation of
the Permanent Court of International Justice (PCIJ)
▪ Subsequently, G.H. Hackworth (United States) committee was entrusted with preparing a draft Statute for the
future international court of justice in 1945.
▪ In April 1946, the PCIJ was formally dissolved, and the International Court of Justice, meeting for the first time,
elected as its President Judge José Gustavo Guerrero (El Salvador), the last President of the PCIJ.
▪ The seat of the Court is at the Peace Palace in The Hague (Netherlands). Of the six principal organs of the
United Nations, it is the only one not located in New York (United States of America).
▪ The Court’s role is to settle, in accordance with international law, legal disputes submitted to it by States and to
give advisory opinions on legal questions referred to it by authorized United Nations organs and specialized
agencies.

Qualifications for ICJ Judge:

▪ A judge should have a high moral character.
▪ A judge should fit to the qualifications of appointment of highest judicial officers as prescribed by their respective
states or.
▪ A judge should be a juriconsult of recognized competence in international law.

Composition:
▪ The Court is composed of 15 judges, who are elected for terms of office of nine years by the United Nations
General Assembly and the Security Council.
▪ The 15 judges of the Court are distributed in following regions:
o Three from Africa.
o Two from Latin America and Caribbean.
o Three from Asia.
o Five from Western Europe and other states.
o Two from Eastern Europe.
▪ In order to be elected, a candidate must receive an absolute majority of the votes in UNGA and UNSC.
▪ In order to ensure a measure of continuity, one third of the Court is elected every three years and Judges are
eligible for re-election.
▪ It is assisted by a Registry, its administrative organ. Its official languages are English and French.

Presidency of the ICJ:

▪ The President and the Vice-President are elected by the Members of the Court every three years by secret
ballot.

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▪ The election is held on the date on which Members of the Court elected at a triennial election are to begin their
terms of office or shortly thereafter.
▪ An absolute majority is required and there are no conditions with regard to nationality. The President and the
Vice-President may be re-elected.
▪ The President presides at all meetings of the Court; he/she directs its work and supervises its administration, with
the assistance of a Budgetary and Administrative Committee and of various other committees, all composed of
Members of the Court.
▪ During judicial deliberations, the President has a casting vote in the event of votes being equally divided.
▪ In The Hague, where he/she is obliged to reside, the President of the Court takes precedence over the doyen of the
diplomatic corps.

Jurisdiction and Functioning:

▪ ICJ acts as a world court with two fold jurisdiction i.e. legal disputes between States submitted to it by them
(contentious cases) and requests for advisory opinions on legal questions referred to it by United Nations
organs and specialized agencies (advisory proceedings).
▪ Only States which are members of the United Nations and which have become parties to the Statute of the Court
or which have accepted its jurisdiction under certain conditions, are parties to contentious cases.
▪ States have no permanent representatives accredited to the Court. They normally communicate with the
Registrar through their Minister for Foreign Affairs or their ambassador accredited to the Netherlands.
▪ The judgment is final, binding on the parties to a case and without appeal (at the most it may be subject to
interpretation or, upon the discovery of a new fact, revision).
▪ By signing the Charter, a Member State of the United Nations undertakes to comply with the decision of the Court
in any case to which it is a party.
▪ A State which considers that the other side has failed to perform the obligations incumbent upon it under a
judgment rendered by the Court may bring the matter before the Security Council, which is empowered to
recommend or decide upon measures to be taken to give effect to the judgment.
▪ ICJ discharges its duties as a full court but, at the request of the parties, it may also establish ad hoc chambers to
examine specific cases.
▪ Advisory proceedings before the Court are only open to five organs of the United Nations and 16 specialized
agencies of the United Nations family or affiliated organizations.
▪ Opinions provided by the court in advisory proceedings are essentially advisory and not binding.

Limitation of ICJ
▪ ICJ suffers from certain limitations, these are mainly structural, circumstantial and related to the material
resources made available to the Court.
▪ It has no jurisdiction to try individuals accused of war crimes or crimes against humanity. As it is not a criminal
court, it does not have a prosecutor able to initiate proceedings.
▪ It differs from the Courts which deal with allegations of violations of the human rights conventions under
which they were set up, as well as applications from States at which courts can entertain applications from
individuals that is not possible for the International Court of Justice.
▪ The jurisdiction of the International Court of Justice is general and thereby differs from that of specialist
international tribunals, such as the International Tribunal for the Law of the Sea (ITLOS).
▪ The Court is not a Supreme Court to which national courts can turn; it does not act as a court of last resort for
individuals. Nor is it an appeal court for any international tribunal. It can, however, rule on the validity of arbitral
awards.
▪ The Court can only hear a dispute when requested to do so by one or more States. It cannot deal with a dispute
on its own initiative. Neither is it permitted, under its Statute, to investigate and rule on acts of sovereign States
as it chooses.
▪ The ICJ only has jurisdiction based on consent, not compulsory jurisdiction.
▪ It does not enjoy a full separation of powers, with permanent members of the Security Council being able to
veto enforcement of cases, even those to which they consented to be bound.

Indian Judge at the ICJ

▪ Justice Dalveer Bhandari won the election to the International Court of Justice with 183 of 193 votes in UN
General Assembly and all 15 at UNSC voting in his favour.

304
▪ India thanked UN members for supporting the re-election of its judge to the International Court of Justice (ICJ)
and said the process reflected respect for its constitutional integrity and independent judiciary.
▪ The UN Security Council and the General Assembly voted overwhelmingly in support of India.
▪ Justice Dalveer Bhandari won the votes in the UN General Assembly to make it to the International Court of
Justice after UK pulled out the race.
▪ The extraordinary support from the UN membership is reflective of the respect for strong constitutional
integrity of the Indian polity and independent of the judiciary in India.
▪ Mr Bhandari will fill the fifth vacancy for the 2018-2027 term.
▪ India’s strategy of portraying the UNGA as the “voice of the people” and the UNSC as the “voice of the global
elite” yielded dividends.

Indian Judges at the ICJ

▪ Judge Dalveer Bhandari: Member of the Court since 27 April 2012
▪ Raghunandan Swarup Pathak: 1989-1991
▪ Nagendra Singh: 1973-1988
▪ Sir Benegal Rau: 1952-1953

Significance for India:

▪ Analysts say the election result was crucial for India to gauge the support it enjoys in the world body where
New Delhi has been campaigning for reforms, including a permanent seat for itself in the powerful Security
Council.
▪ The re-election is also crucial as it ensures India’s continued influence at the ICJ where the Kulbhushan
Jadhav case against Pakistan will come up next month.
▪ India has moved the International Court of Justice (ICJ) against Pakistan, accusing the latter of violating the
Vienna Convention in the case of Indian spy Kulbhushan Jadhav, who was handed a death sentence by a Field
General Court Martial (FGCM) last month.
▪ India requested the ICJ to ensure that Jadhav’s death sentence is suspended and declared a violation of the Vienna
Convention on Consular Relations.
▪ The re-election was a positive affirmation of Indian diplomacy.
▪ This was the first time that a permanent member of the United Nations Security Council (UNSC) was in direct
contest with a non-member for the post of a judge at the ICJ. And India clinched the deal in the end.

Kulbhushan Jadhav Case:

▪ Kulbhushan Jadhav was arrested in March 2016 by Pakistani security forces in Balochistan province after he
reportedly entered from Iran.
▪ He was sentenced to death by a Pakistani military court on the charges of espionage and terrorism in April
2017.
▪ India has always maintained that Kulbhushan Jadhav is not a spy, and that Pakistan should provide counsellor
access to him as his case pertains to abduction from the Iranian territory.
▪ In May 9, 2018, ICJ has stayed his death sentence after India had moved a petition before the UN body to
seek justice for him, alleging violation of the Vienna Convention on Consular Relations by Pakistan.
▪ During the latest hearing in the case on February, 2019, India said Pakistan's continued custody of Indian
national Kulbhushan Jadhav without any consular access should be declared "unlawful" as it was an egregious
violation of the Vienna Convention.
▪ Harish Salve, who is representing India and Kulbhushan Jadhav in the ICJ, said Pakistan was using the issue of
Kulbhushan Jadhav as a "propaganda tool" without even following the due proper procedure.

Vienna Convention on Consular Relations

▪ The Vienna Convention on Consular Relations is an international treaty that defines consular
relations between independent states.
▪ A consul, (who is not a diplomat) is a representative of a foreign state in a host country, who works for the
interests of his countrymen.
▪ Article 36 of the Vienna Convention states that foreign nationals who are arrested or detained in the host
country must be given notice without delay of their right to have their embassy or consulate notified of that arrest.

305
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▪ If the detained foreign national so requests, the police must fax that notice to the embassy or consulate, which
can then verify the person.

Vienna Convention on Diplomatic Relations

▪ It is an international treaty of 1961 which gives a framework for diplomatic relations between independent
countries.
▪ It specifies the privileges of a diplomatic mission that enable diplomats to perform their functions without fear of
coercion or harassment by the host country.
▪ It forms the legal basis for diplomatic immunity.
▪ India is a party to both the above conventions.

Difference between International Court of Justice and International Criminal Court:

BASIS INTERNATIONAL CRIMINAL COURT INTERNATIONAL COURT OF

JUSTICE
Relationship Independent; UN Security Council may refer Primary judicial branch of the UN.
with the United matters to it
Nations
Members 105 members 193 members (all members of the United
Nations).
Derives authority The Rome Statute Charter of the United Nations and the
from Statute of the International Court of
Justice.
Scope of work Criminal matters – investigating and prosecuting Civil matters- settling legal disputes
crimes of genocide, crimes against humanity, and between the member-states and giving
war crimes advisory opinions on international legal
issues
Jurisdiction Only the member nations of the ICC, which means All the member nations of the UN,
around 105 countries. Can try individuals. which means 193 countries. Cannot try
individuals and other private entities.
Composition 1 prosecutor and 18 judges, who are elected for a 15 judges who are elected for a 9-year
9-year term each by the member-states which term each and are all from different
make up the Assembly of State Parties with all nations.
being from different nations
Funding Funded by state parties to the Rome Statute and Funded by the UN.
voluntary contributions from the United Nations,
governments, individual corporations, etc.

ICJ On Decolonization of Mauritius:

▪ International Court of Justice (ICJ) in an advisory opinion has said that Britain has to handover Chagos
Archipelago to complete the process of decolonization of Mauritius.
▪ According to Britain, the request for an advisory opinion by the Government of Mauritius circumvents a vital
principle, that a State is not obliged to have its bilateral disputes submitted for judicial settlement without its
consent.
▪ Mauritius has maintained that Britain’s “unilateral” decision to ban the right of return of Chagossians (African
Tribe) and to renew the lease for the US base on Diego Garcia, one of the Chagos Islands, breached
international law.

Way Forward
▪ The International Court of Justice is endowed with both a privileged institutional status and procedural
instruments whose potential is frequently underestimated.
▪ The International Court of Justice is a component, not only of the machinery for the peaceful settlement of
disputes created by the Charter but also of the general system for the maintenance of international peace
and security it established.

306
▪ Its jurisprudence had helped to consolidate the Organization’s role and place in the international legal order
by clarifying its legal status as an international organization and the scope of powers with which it was entrusted.
▪ Its decisions had also shed light, within the institution itself, on the functioning and responsibilities of the
Organization’s principal organs and on those functions’ limits.
▪ Moreover, the Court had pronounced itself in texts adopted by the General Assembly, thereby strengthening the
cooperation in the promotion and development of international peace.
▪ Recently, the Court had the opportunity to reiterate that finding in its opinion on the Legal Consequences of the
Construction of a Wall in the Occupied Palestinian Territory, which had been delivered in 2004.
▪ The Court had recalled that, although the Security Council had primary responsibility for the maintenance of
international peace and security under Article 24 of the Charter, its responsibility was not exclusive.
▪ Turning to "Crimes against humanity", while the Rome Statute regulated "vertical relationships" between
the International Criminal Court and its States Parties, it did not prescribe any obligations regarding adoption of
national laws on such crimes or inter-State cooperation.
▪ The current work would create "Horizontal Relationships" among States and regulate inter-State cooperation,
strengthening the international community’s efforts to prevent those crimes.

307
 CH-9 INTERNATIONAL CRIMINAL COURT (ICC)
Basics and Background:
▪ Governed by an international treaty called 'The Rome
Statute', the ICC is the world’s first permanent
international criminal court.
▪ On 17 July, 1998 Rome Statute was adopted by 120 States in
direction of creating a more just world.
▪ On 1 July, 2002 Rome Statute took effect upon ratification
by 60 states, officially establishing the ICC. Since it has no
retroactive jurisdiction, the ICC deals with crimes committed
on or after this date.
▪ It investigates and, where warranted, tries individuals charged
with the gravest crimes of concern to the international
community: genocide, war crimes, crimes against humanity
and the crime of aggression.
▪ Through international criminal justice, ICC aims to hold those responsible for their crimes and to help prevent
these crimes from happening again.
▪ India is not a party to Rome Statute along with US and China.
▪ Recently Malaysia has ratified the Rome Statute and became the 124th State party to the ICC.

Organisation Structure
▪ The Assembly of States Parties provides management oversight for the Court, including electing judges and the
Prosecutor and approving the ICC’s budget.
▪ Four organs of the ICC:
o Presidency conducts external relations with States, coordinates judicial matters such as assigning judges,
situations and cases to divisions, and oversees the Registry's administrative work.
o Judicial Divisions (18 judges in 3 divisions) Pre-Trial, Trial and Appeals – conduct judicial proceedings
o Office of the Prosecutor conducts preliminary examinations, investigations, and prosecutions.
o Registry conducts non-judicial activities, such as security, interpretation, outreach, support to Defence and
victims' lawyers etc.
▪ Trust Fund for Victims provides assistance, support and reparations to victims.
▪ The ICC has field offices in several of the countries in which investigations are being conducted.
▪ The ICC detention centre is used to hold in safe, secure and humane custody those detained by the ICC.
▪ The International Committee of the Red Cross (ICRC) is the Detention Centre's inspecting authority and as
such has unrestricted access and examine, on unannounced visits.

Jurisdiction and Working of Court

▪ The Rome Statute, grants the ICC jurisdiction over four main crimes –
▪ The crimes were committed by a State Party national, or in the territory of a
State party, or in a State that has accepted the jurisdiction of the court.
▪ The crimes were referred to the ICC Prosecutor by the UNSC pursuant to a
resolution adopted under Chapter VII of the UN Charter.
▪ The ICC is intended to complement, not to replace, national criminal
systems, it prosecutes cases only when States do not are unwilling or unable to
do so genuinely.
▪ ICC is not a UN organisation but it has a cooperation agreement with the
UN.
▪ When a situation is not within the Court’s jurisdiction, the UNSC can refer the
situation to the ICC granting it jurisdiction.

India and ICC

India did not signed the Rome Statute, and thus, is not a member of ICC because of following reasons:
▪ State sovereignty

308
▪ National interests
▪ Difficulty in collection of evidences
▪ Problem to find impartial prosecutors
▪ Crime definition

Relevance of ICC:
▪ Serve as catalyst for strengthening domestic legal action in pursuit of justice and accountability for atrocities
and international crimes.
▪ Act as a court of last resort with the capacity to prosecute individuals for genocide, crimes against humanity and
war crimes, when national jurisdictions for any reason are unable or unwilling to do so.
▪ Have made particular advances in combating impunity in relation to crimes against children and women.
Gender crimes were featured in the vast majority of ICC cases to date.
▪ Creating nexus between justice and development by setting up Trust Fund for Victims, which provides
assistance to victims and their families to rebuild sustainable livelihoods.

Limitations of ICC:
▪ As a judicial institution, the ICC does not have its own police force or enforcement body; thus, it relies on
cooperation with countries worldwide for support, particularly for making arrests, transferring arrested persons to
the ICC detention centre in The Hague, freezing suspects’ assets, and enforcing sentences.
▪ This State cooperation is problematic for several reasons. It means that the ICC acts inconsistently in its
selection of cases, is prevented from taking on hard cases and loses legitimacy.
▪ It also gives the ICC less deterrent value, as potential perpetrators of war crimes know that they can avoid ICC
judgment by taking over government and refusing to cooperate.
▪ There is insufficient checks and balances on the authority of the ICC prosecutor and judges.
▪ ICC has been accused of being a tool of Western imperialism and biased in favour of powerful countries against
weak states.
▪ ICC cannot impose a death sentence; it can impose lengthy terms of imprisonment of up to 30 years or life when
so justified by the gravity of the cases.
▪ The ICC court has no retrospective jurisdiction as it can deal only with crimes committed after 1 July 2002
when the 1998 Rome Statute came into force.
▪ ICC has automatic jurisdiction only for crimes committed on the territory of a state which has ratified the
treaty; or by a citizen of such a state; or when the United Nations Security Council refers a case to it.
▪ Procedural and substantive deficiencies leading to delays and frustration, have questioned the efficacy of the
court.
▪ It also faces scarcity of human resources and funds.

Way Forward:
▪ States should actively encourage cooperation with ICC and support human rights defenders working
towards international justice and the fulfilment of the ICC’s mandate.
▪ To enhance its credibility the court needs to broaden its ambit by including more permanent members of UN
and by strengthening of investigations and prosecutions.
▪ ICC role is very important as international justice can contribute to long‐term peace, stability and equitable
development in post‐conflict societies.
▪ Having said so it is also important to know that the ICC actively works to build understanding and cooperation
in all regions through seminars and conferences worldwide.

309
 CH-10 INTERPOL
Basics and Background
▪ The International Criminal Police Organisation (INTERPOL) is an international
organization that facilitates worldwide police cooperation and crime control.
▪ It originated with the first International Criminal Police Congress in 1914, which
brought officials from 24 countries to discuss cooperation on law enforcement matters.
▪ It was founded in 1923 as the International Criminal Police Commission (ICPC).
▪ In 1946, after the end of World War II, the organization was revived as
the International Criminal Police Organization (ICPO) by officials from Belgium,
France, Scandinavia and the UK.
▪ In 1956, the ICPC adopted a new constitution and the name
INTERPOL.
▪ It is headquartered in Lyon, France.
▪ It has seven regional bureaus worldwide and a National Central Bureau
(NCB) in all 194 member states, making it the world’s largest police COUNTER
organization. CYBERCRIME
TERRORISM
▪ India has been a member since 1956.
▪ India maintains NCB which serves as the national platform for
cooperation between domestic law enforcement units and the
international police community. ORGANISED AND
▪ Central Bureau of Investigation (CBI) is designated as National Central EMERGING CRIMES
Bureau of India.

Objectives of INTERPOL:
▪ To ensure and promote the widest possible mutual assistance between all criminal police authorities within the
limits of the laws existing in the different countries.
▪ To establish and develop all institutions which contribute to the prevention and suppression of ordinary law
crimes.
▪ It cannot undertake any intervention or activities of a political, military, religious or racial character.

Structure of INTERPOL:
▪ The General Assembly is the governing body and it brings all countries together once a year to take decisions.
▪ The General Secretariat coordinates the day-to-day activities to fight a range of crimes.
▪ Run by the Secretary General, it is staffed by both police and civilians.
▪ In each country, an INTERPOL National Central Bureau (NCB) provides the central point of contact for the
General Secretariat and other NCBs.
▪ The NCB is run by national police officials and usually sits in the government ministry responsible for policing.

INTERPOL - General Assembly:

▪ It is Interpol’s supreme governing body, and comprises representatives from all its member countries.
▪ It meets annually for a session lasting approximately four days, to vote on activities and policy.
▪ Each country is represented by one or more delegates at the Assembly, who are typically chiefs of law
enforcement agencies.
▪ The Assembly also elects the members of the Interpol Executive Committee, the governing body which
“provides guidance and direction in between sessions of the Assembly”.

Assembly Resolutions:
▪ The General Assembly’s decisions take the form of Resolutions.
▪ Each member country has one vote.
▪ Decisions are made either by a simple or a two-thirds majority, depending on the subject matter.

Functions of INTERPOL:
▪ The General Secretariat provides a range of expertise and services to the member countries.

310
▪ It manages 18 police databases with information on crimes and criminals (from names and fingerprints to
stolen passports), accessible in real-time to countries.
▪ It offers investigative support such as forensics, analysis, and assistance in locating fugitives around the world.

▪ The expertise supports national efforts in combating crimes across three global areas including terrorism,
cybercrime and organized crime.
▪ Carry out research and development in international crime and trends.
▪ The Interpol doesn’t have law enforcement powers such as arrest. When a member nation approaches it with a
specific request backed with court orders, the Interpol sends it out to other countries. The information received is
sent back to the country.

Different Types of INTERPOL Notices:

The Interpol facilitates information exchange, knowledge sharing and research between nations by issuing colour-
coded ‘notices’ in four languages – English, Spanish, French, and Arabic.

Red Notice: It is a request to locate and provisionally arrest an individual pending extradition. It is issued
by the General Secretariat at the request of a member country or an international tribunal
based on a valid national arrest warrant. However, the arrest of the fugitive is based on the
rule of the member nation where he or she is located.
Yellow Notice: It is issued to help locate missing persons, often minors, or to help identify persons who are
unable to identify themselves. This is highly useful in cases of human trafficking or in case of
missing persons due to calamities.
Blue Notice: It is issued to collect additional information about a person’s identity, location or activities in
relation to a crime. This does not guarantee extradition or arrest of the person.
Black Notice: It is a request to seek information on unidentified bodies in member nations.

Green Notice: It is issued to provide warnings and intelligence about persons who have committed criminal
offences and are likely to repeat these crimes in other countries.
Orange Notice: It is issued to provide warnings about an event, a person, an object or a process representing a
serious and imminent threat to public safety.
Purple Notice: It is a request to seek or provide information on the modus operandi, objects, devices and
concealment methods used by criminals.

311
INTERPOL and COVID-19:
▪ INTERPOL has warned member countries that cybercriminals were attempting to
target hospitals and institutions on the front lines of the fight against COVID-19 with
ransomware.
▪ In an alert sent to 194 nations, including India, Interpol said organisations at the
forefront of the global response to the COVID-19 outbreak had also become targets of
ransomware attacks, which were designed to lock them out of their critical systems in an
attempt to extort payments.
▪ The agency’s Cybercrime Threat Response Team had detected an increase in the
number of attempted ransomware attacks against key organisations and infrastructure engaged in the virus
response.
▪ Interpol also issued a ‘Purple Notice’. It is issued to seek or provide information on modus operandi, objects,
devices and concealment methods used by criminals.

312
 CH-11 FINANCIAL ACTION TASK FORCE (FATF)
Basics and Background
▪ The Financial Action Task Force (FATF) is an inter-governmental decision-making
body. It was established in 1989 during the G7 Summit in Paris to develop policies
against money laundering and its Secretariat is located in Paris.
▪ It brings national legislative and regulatory reforms in money laundering and it also
works to stop funding for weapons of mass destruction.
▪ The FATF reviews money laundering and terrorist financing techniques and
continuously strengthens its standards to address new risks, such as the regulation of
virtual assets, which have spread as crypto currencies gain popularity.
▪ The FATF monitors countries to ensure they implement the FATF Standards fully
and effectively and holds countries to account that does not comply with the
standards.
▪ India became an Observer at FATF in 2006. Since then, it had been working
towards full-fledged membership. On June 25, 2010, India was taken in as the 34th
country member of FATF.

Objectives of FATF:
▪ To set standards and promote effective implementation of legal, regulatory and operational measures for
combating money laundering, terrorist financing and other related threats to the integrity of the international
financial system.

Roles and Functions:

▪ Initially it was established to examine and develop measures to combat money laundering.
▪ In October 2001, the FATF expanded its mandate to incorporate efforts to combat terrorist financing, in addition
to money laundering.
▪ In April 2012, it added efforts to counter the financing of proliferation of weapons of mass destruction.

FATF On Terror Financing:

▪ FATF’s role in combating terror financing became prominent after the 9/11 terror attacks in the US. In 2001 its
mandate expanded to include terrorism financing.
▪ Financing of terrorism involves providing money or financial support to terrorists.
▪ As of 2019, FATF has blacklisted North Korea and Iran over terror financing and 12 countries are in the grey
list, namely: Bahamas, Botswana, Cambodia, Ethiopia, Ghana, Pakistan, Panama, Sri Lanka, Syria,
Trinidad and Tobago, Tunisia and Yemen.

Lists of FATF:

Grey List: ▪ Countries that are considered safe haven for supporting terror funding and money
laundering are put in the FATF grey list. This inclusion serves as a warning to the country
that it may enter the blacklist.
Black List: ▪ Countries known as Non-Cooperative Countries or Territories (NCCTs) are put in the
blacklist. These countries support terror funding and money laundering activities. The
FATF revises the blacklist regularly, adding or deleting entries.

FATF & Pakistan:

▪ Pakistan has been on the FATF grey list since June 2018 and was asked to implement the FATF Action Plan
fully by September 2019. It was in the same category from 2012 to 2015 too.
▪ Pakistan’s inclusion in the grey list can be attributed to the fact that the country’s anti-terror laws are still not in
line with FATF standards and also with the latest UN resolution 2462 that pitches for criminalising terrorist
financing.
▪ Multiple internationally designated terrorist groups operate from its soil.

313
▪ Notable among them are the Afghan Taliban, Haqqani Network, Lashkar-e-Taiba (LeT) and Jaish-e-
Mohammed (JeM).
▪ Pakistan detained both Masood Azhar and Hafiz Saeed for ‘apprehension’ of breach of peace in response to
degradation to the grey list. The FATF seeks freezing of funds, denial of weapons access and travel ban.
▪ While there were some arrests of LeT, JeM, JuD cadres, they were all apprehended under the country’s
Maintenance of Public Order Act and not the Anti-Terrorism Act, 1997.
▪ Pakistan, which continues to remain on the Grey List of FATF, had earlier been given the deadline till the June
2020 to ensure compliance with the 27-point action plan against terror funding networks and money laundering
syndicates, or face “black listing”.
▪ However, owing to the Covid-19 pandemic, the deadline has been shifted to October 2020.

Things To Do For Pakistan:

▪ To improve the mechanisms for curbing terror financing.
▪ To amend laws to curb ‘Hawala’ transactions and placing sanctions against cash couriers who facilitate terror
groups.
▪ To complete the prosecution of groups banned by the UNSC.
▪ To convert the madrassas run by these groups into formal schools.
▪ Each item demands more accountability by Pakistan on terror groups.

Consequence Of FATF Grey List:

▪ Economic sanctions from IMF, World Bank, ADB.
▪ The problem in getting loans from the IMF, World Bank, ADB and other countries.
▪ Reduction in international trade.
▪ International boycott.

FATF’S View on Crime Amid Covid-19:

▪ The FATF which is actively monitoring the impact of the pandemic on measures to combat illicit financing,
released a paper on “Covid-19-related Money Laundering and Terrorist Financing Risks and Policy
Responses”.
▪ It observed an increase in the Covid-19 related crimes, including fraud, cyber-crime, misdirection or
exploitation of government funds or international finance assistance.

Effectiveness of FATF In Curbing Money Laundering and Terror Financing:

▪ Over a period of time the FATF has gained perceptible credibility as a professional organisation, which has
succeeded in not only increasing awareness regarding the challenges being faced by the global financial system,
but also human security issues like terrorism.
▪ The FATF has been at the forefront of international efforts to fight money laundering and combating finance to
terrorism. Its efforts have been in conjunction with relevant resolutions of the United Nations Security Council
(UNSC).
▪ It has gained considerable influence over the regulatory framework that deals with financial transactions, in an
attempt to make it less liable to exploitation by both profiteers and terrorists.
▪ Terrorist financing investigation and prosecution ensures that terrorist financing offences and activities are
investigated and persons who finance terrorism are prosecuted and subject to effective, proportionate and
dissuasive sanctions.
▪ FATF has become one of the major factors for countries like Pakistan being pressurised to take requisite action
against terrorists operating from its soil. Terrorist financing preventive measures & financial sanctions require
that terrorists, terrorist organisations and terrorist financiers are prevented from raising, moving and using funds,
and from abusing the non-profit sector.
▪ The naming and shaming policy of the FATF has a corrective underlying principle. A country can be placed on
a list and then removed thereafter on receipt of assurance from the highest political authority, along with a
judgment on the progress made to implement the guidelines, has ensured an improvement in the overall CFT
standards.

Pakistan Unlikely to Exit FATF's Grey List:

▪ Pakistan might remain on the grey list of the Financial Action Task Force (FATF) as it has been unable to
comply with 6 of the 27 points in the global watchdog's action plan.

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▪ The FATF had placed Pakistan on the grey list in June 2018 and asked Islamabad to implement a plan of action to
curb money laundering and terror financing by the end of 2019, but the deadline was extended later on due to
the coronavirus pandemic.
▪ However, the country has managed to avert being blacklisted.
▪ The country had completed its legal formalities and informed the watchdog that it had managed to comply with
21 of the points in the action plan.
▪ Pakistan has succeeded in making 20 per cent progress in the remaining six points of the action plan.

Way Forward:
▪ As Pakistan has now been placed in the grey list, it will now have to provide a detailed 27 point action plan to
curbing funding for UN-designated terrorist groups.
▪ If Pakistan fails, FATF will be ‘black listing’ it, a move that could virtually cut all financial flows.
▪ Pakistan has only completed about 21 points so far.
▪ The developments at FATF have frustrated many in Pakistan.
▪ But no political party seems capable of asking the military to end its support for terrorists.
▪ As there seems to be a lack of a genuine effort to curtail terrorist activity, all major economies must be
persuaded to boycott Pakistan.
▪ While China might continue to aid Pakistan financially, its funding model thus far has been only increasing
Pakistan’s debt burden.
▪ Given its precarious foreign exchange position, Pakistan will inevitably have to seek a bailout from international
organisations like IMF and World Bank.
▪ Consensus needs to be strengthened for not providing concessional credits unless terror infrastructure is
irrevocably dismantled.

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CH-12 INTERNATIONAL UNION FOR CONSERVATION OF
NATURE AND NATURAL RESOURCES (IUCN)
Basics and Background:
▪ IUCN was founded in October 1948 as the International Union for the Protection of Nature
(or IUPN) following an international conference in Fontainebleau, France.
▪ The organization changed its name to the International Union for Conservation of Nature
and Natural Resources in 1956 with the acronym IUCN (or UICN) with its headquarters in
Gland, Switzerland.

Vision:
▪ Just world that values and conserves nature.

Mission:
▪ To influence, encourage and assist societies throughout the world to conserve the integrity and diversity of
nature and to ensure that any use of natural resources is equitable and ecologically sustainable.
▪ IUCN supports scientific research, manages field projects globally and brings governments, non-government
organizations, United Nations agencies, companies and local communities together to develop and implement
policy
▪ IUCN Members include both States and non-governmental organizations.
▪ A neutral forum for governments, NGOs, scientists, business and local communities to find practical solutions to
conservation and development challenges.

Priority Areas of IUCN:

Biodiversity

Green Climate
Economy Change

Human well- Sustainable

being Energy

IUCN Red Data Book

▪ Threatened species are any species which are vulnerable to extinction in the near future.

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▪ International Union for Conservation of Nature treats threatened species not as a single category, but as a group of
three categories: vulnerable, endangered, and critically endangered, depending on the degree to which they are
threatened.

Critically Endangered Species

▪ Critically Endangered (Cr) is the highest risk category assigned by the IUCN for wild species.
▪ Critically endangered species means a species numbers have decreased, or will decrease by 80% within three
generations.
▪ It is therefore considered to be facing an extremely high risk of extinction in the wild.

Endangered (EN) species

▪ Endangered (EN) species is a population of organisms which is at risk of becoming extinct because it is either
few in numbers, or threatened by changing environmental or predation parameters.
▪ Also it could mean that due to deforestation there may be a lack of food and/or water.
▪ It is therefore considered to be facing a very high risk of extinction in the wild.

Vulnerable (VU) species

▪ Vulnerable (VU) species is a species which has been categorised by the IUCN as likely to become endangered
unless the circumstances threatening its survival and reproduction improve.
▪ It is therefore considered to be facing a high risk of extinction in the wild.

Extinct, Functionally Extinct and Extinct in the wild

▪ A species becomes extinct when the last existing member of that species dies. Extinction therefore becomes a
certainty when there are no surviving individuals that are able to reproduce and create a new generation.
▪ A species may become functionally extinct when only a handful of individuals survive, which are unable to
reproduce due to poor health, age, sparse distribution over a large range, a lack of individuals of both sexes
(in sexually reproducing species), or other reasons.
▪ An important aspect of extinction at the present time is human attempts to preserve critically endangered species,
which is reflected by the creation of the conservation status “Extinct in the Wild” (EW).
▪ Species listed under this status by IUCN are not known to have any living specimens in the wild, and are
maintained only in zoos or other artificial environments.
▪ Some of these species are functionally extinct; as they are no longer part of their natural habitat and it is
unlikely the species will ever be restored to the wild.

Reasons for Species Extinction:

▪ Main reasons for extinction are either natural or manmade. Through evolution, new species arise through the
process of speciation and species become extinct when they are no longer able to survive in changing conditions
or against superior competition.
▪ A typical species becomes extinct within 10 million years (1 crore year) of its first appearance although some
species, called living fossils, survive virtually unchanged for hundreds of millions of years.
▪ Extinction, though, is usually a natural phenomenon; it is estimated that 99.9% of all species that have ever lived
are now extinct.
▪ Various anthropogenic activities causing extinction are manmade reasons. Only recently scientists have
become alarmed at the high rates of recent extinctions due to various anthropogenic activities.
▪ Some of these anthropogenic activities include intentional or accidental introduction of invasive alien species,
over exploitation and unscientific collection of Non-Timber Forest Produce (NTFPs) including medicinal
plant, climate change, unsustainable tourism, habitat destruction, encroachment etc.

IUCN PUBLICATION:
▪ The IUCN Red List of Threatened Species assesses risk of species extinction
▪ The IUCN Red List of Ecosystems assesses risk of ecosystem collapse
▪ The IUCN World Heritage Outlook assesses World Heritage sites over time
▪ The World Database of Key Biodiversity Areas assesses sites important for biodiversity
▪ Protected Planet assesses protected areas
▪ ECOLEX provides a gateway to environmental law
▪ PANORAMA

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 CH-13 INTERNATIONAL LABOUR ORGANISATION (ILO)
Basics and Background:
▪ It is the only tripartite United Nations agency, bringing together governments,
employers and workers representatives from its 187 member states to devise
international labour standards.
▪ It became the first specialized agency of UN in 1946.
▪ Established in 1919 by the Treaty of Versailles as an affiliated agency of Governments
the League of Nation (LoN).
▪ Became the first affiliated specialized agency of the United Nations in 1946.
▪ Headquarters: Geneva, Switzerland
▪ Founding Mission: Social Justice is essential to universal and lasting peace.
▪ Promotes internationally recognized human and labour rights. Workers
Representatives
Employers
▪ Received the Nobel Peace Prize in 1969.

Structure of ILO:
▪ International Labour Conference: it sets the International labour standards
and the broad policies of the ILO. It meets annually in Geneva. It is often
referred to as an International Parliament of Labour.
▪ Governing Body: it is the executive council of the ILO. It meets three times a
year in Geneva.
▪ International Labour Office: it is the permanent secretariat of the
International Labour Organization.
▪ Regional meetings of the ILO member States are held periodically to examine
matters of special interest to the regions concerned.

Objective
▪ To promote and realize standards and fundamental principles and rights at work.
▪ To create greater opportunities for women and men to secure decent employment.
▪ To enhance the coverage and effectiveness of social protection for all.
▪ To strengthen tripartism and social dialogue.

Functions:
▪ Creation of coordinated policies and programs, directed at solving social and labour issues.
▪ Adoption of international labour standards in the form of conventions and recommendations and control over
their implementation.
▪ Assistance to member-states in solving social and labour problems.
▪ Human rights protection (the right to work, freedom of association, collective negotiations, protection against
forced labour, protection against discrimination, etc.).
▪ Research and publication of works on social and labour issue

Eight-core conventions of the ILO:

▪ Forced Labour Convention (No. 29)
▪ Abolition of Forced Labour Convention (No.105)
▪ Equal Remuneration Convention (No.100)
▪ Discrimination (Employment Occupation) Convention (No.111)
▪ Minimum Age Convention (No.138)
▪ Worst forms of Child Labour Convention (No.182)
▪ Freedom of Association and Protection of Right to Organised Convention (No.87)
▪ Right to Organise and Collective Bargaining Convention (No.98)

ILO Declaration on Fundamental Principles and Rights at Work:

▪ Freedom of Association and The Right to collective bargaining (Conventions 87 and 98)

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▪ Elimination of forced or compulsory labour (Conventions No. 29 and No. 105)
▪ Abolition of child labour (Conventions No. 138 and No. 182)
▪ Elimination of discrimination in respect of employment and occupation (Conventions No. 100 and No. 111)

Contribution of ILO:
▪ Workers right: The ILO Declaration on Fundamental Principles and Rights at Work.
▪ Reducing forced labour and providing minimum wage scale: The organisation has set uniform, universal
standards for corporations to follow.
▪ Employment: From advice to government policies to direct training to poor communities.
▪ Migrants: Protection of Migrant workers.
▪ Reducing Child Labour: To eradicate child labour, the ILO had launched International Programme on the
Elimination of Child Labour (IPEC) in 1992.
▪ HIV/AIDS: The ILO is the lead UN-agency on HIV workplace policies and programmes and private sector
mobilization.

India and ILO

▪ India is a founding member of the ILO and it has been a permanent member of the ILO Governing Body
since 1922.
▪ In India, the first ILO Office was started in 1928. The decades of productive partnership between the ILO and its
constituents has mutual trust and respect as underlying principles and is grounded in building sustained
institutional capacities and strengthening capacities of partners.
▪ India has ratified six out of the eight-core/fundamental ILO conventions. These conventions are:
1. Forced Labour Convention (No. 29)
2. Abolition of Forced Labour Convention (No.105)
3. Equal Remuneration Convention (No.100)
4. Discrimination (Employment Occupation) Convention (No.111)
5. Minimum Age Convention (No.138)
6. Worst forms of Child Labour Convention (No.182)
▪ India has not ratified the two core/fundamental conventions, namely Freedom of Association and Protection of
the Right to Organise Convention, 1948 (No. 87) and Right to Organise and Collective Bargaining
Convention, 1949 (No. 98).

Global Commission on the Future of Work:

▪ The formation of an ILO Global Commission on the Future of Work marks the second stage in the ILO Future
of Work Initiative.
▪ It was co-chaired by South African President Cyril Ramaphosa and Swedish Prime Minister, Stefan Löfven.
▪ The commission outlines a vision for a human-centred agenda that is based on investing in people’s capabilities,
institutions of work and decent and sustainable work.
▪ It has undertaken an in-depth examination of the future of work that can provide the analytical basis for the
delivery of social justice in the 21st century.
▪ It outlines the challenges caused by new technology, climate change and demography and calls for a collective
global response to the disruptions they are causing in the world of work.

KEY RECOMMENDATIONS:
▪ A universal labour guarantee that protects the fundamental rights of workers’, an adequate living wage, limits
on hours of work and safe and healthy workplaces.
▪ Guaranteed social protection from birth to old age that supports people’s needs over the life cycle.
▪ A universal entitlement to lifelong learning that enables people to skill, reskill and upskill.
▪ Managing technological change to boost decent work, including an international governance system for digital
labour platforms.
▪ Greater investments in the care, green and rural economies.
▪ A transformative and measurable agenda for gender equality.
▪ Reshaping business incentives to encourage long-term investments.

Universal ratification of Convention 182:

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▪ The historic first universal ratification of a global labour
standard may be an occasion for celebration; it is nonetheless a
moment for sober reflection.
▪ ILO Director General celebrates the universal ratification of
ILO Convention No. 182, the first ILO Convention in history
to achieve universal ratification.
▪ As of this day, children benefit from critical legal protection from
the worst forms of child labour in every ILO member State.
▪ Since its adoption in 1999, ratification of this Convention
and ILO Convention No. 138 on Minimum Age has ushered in
targeted programmes to tackle child labour through education,
social protection, and decent work for adults and youth of working
age, resulting in a decline in child labour of almost 100 million
since 2000.
▪ The welcome decision by the Kingdom of
Tonga to outlaw the worst forms of child labour is the first
time in the International Labour Organization (ILO)’s 101-year
history that a labour standard has been universally ratified.

ILO conventions of 182:

▪ Convention 182, which was adopted in the 1999 annual
international labour conference, prohibits the sexual exploitation
of children, trafficking, deployment in armed conflict and
other conditions that compromise their overall well-being.
▪ The Convention complements the ILO’s efforts under the 1973 Minimum Age Convention to prevent the
employment of children below a lower age threshold.
▪ Under the influence of both these ILO standards, millions of young boys and girls have been rescued from
hazardous conditions of work.
▪ Concomitantly, these have resulted in significant increases in enrolments in primary education. The landmark
ratification, however, does not detract from the enormity of the challenge that remains.
▪ An estimated 152 million are trapped in child labour and 72 million of them are engaged in hazardous work.
▪ If anything, current efforts would have to be stepped up significantly to achieve the ambitious goal of total
abolition of the scourge of child labour by 2025.
▪ But the COVID-19 pandemic is threatening a reversal of recent gains, with widespread job losses, deterioration in
conditions of work, decline in household incomes and temporary school closures.

INDIAN CONSTITUTIONAL PROVISIONS

▪ Article 21(A) and Article 45 – The child has the right to Education i.e. the state shall provide compulsory and
free education to the children of the age six to 14 years.
▪ Article 24 –There is a provision under which a child below the age of 14 years cannot be employed in any mine,
factory or hazardous workplace.
▪ Article 39(f) –The child’s youth and childhood are to be protected against moral and material abandonment and
exploitation.

IPEC+ Flagship Programme:

▪ The International Programme on the Elimination of Child Labour (IPEC) and the Special Action
Programme to combat Forced Labour (SAP/FL) – to establish a major new force in the fight against child
labour, forced labour and human trafficking.
▪ It recognizes that these unacceptable forms of work deny workers their basic human rights at work and that,
while their overlap concerns 4.5 million children trapped in contemporary forms of slavery, they share root causes
of poor governance, discrimination and social exclusion, family and community poverty and lack of access to
decent work and to the rights of freedom of association and collective bargaining.
▪ The objective of the IPEC+ Flagship Programme, in line with target 8.7 of the 2030 Sustainable Development
Agenda, is to provide ILO leadership in global efforts to eradicate all forms of child labour by 2025 and all
forms of contemporary slavery and human trafficking by 2030.

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▪ It also aims to ensure that all people are protected from and can protect themselves against these gross human
rights violations.

IPEC+ Flagship Programme and COVID-19:

▪ COVID-19 has plunged the world into a crisis of unprecedented scope and scale. The harmful effects of this
pandemic will not be distributed equally.
▪ They are expected to be most damaging for those in already disadvantaged or vulnerable situations, such as
children in child labour and victims of forced labour and human trafficking, particularly women and girls.
▪ These vulnerable groups are more affected by income shocks due to the lack of access to social protection,
including health insurance and unemployment benefits.
▪ IPEC+ Flagship Programme has developed plans to mitigate the risks and to repurpose its strategy and is
seeking to allocate additional funding to support efforts to monitor the impact of COVID-19 on child labour
and forced labour.

ILO Publication:
1. World Employment and Social Outlook Report
2. Global Wage Report
3. World Social Protection Report

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 CH-14 WORLD INTELLECTUAL PROPERTY
ORGANISATION (WIPO)
Basics and Background:
▪ WIPO is one of the oldest specialised agencies of United Nation's (UN).
▪ WIPO was created in 1967 "to encourage creative activity, to promote the protection of intellectual property
throughout the world".
▪ WIPO currently administers 26 international treaties.
▪ It is headquartered in Geneva, Switzerland.
▪ Every year “World Intellectual Property Day” is being celebrated on 26th April.

Intellectual Property (IP)

▪ Intellectual Property (IP) is a category of property that includes intangible creations of the human intellect,
and primarily encompasses copyrights, patents and trademarks.
▪ It also includes other types of rights, such as trade secrets, publicity rights, moral rights, and rights against
unfair competition.

Types of Intellectual Properties:

▪ Copyright covers literary works (such as novels, poems and plays), films, music, artistic works (e.g., drawings,
paintings, photographs and sculptures) and architectural design. Rights related to copyright include those of
performing artists in their performances, producers of phonograms in their recordings, and broadcasters in their
radio and television programs.
▪ Industrial Property includes patents for inventions, trademarks, industrial designs and geographical indications.

Patents: Patents are exclusive rights granted by the Government to a company/individual for an
invention. Patents are time bound. For ex: In India patents are granted for a period of 20 years
from the date of filing of the patent application. It is also to be noted that the patents are valid
only within the territory where they have been granted. Once a patent expires, protection ends
and the invention enters the public domain.
Trademark: Trademark is a word, or symbol, or phrase, or design, or any combination of these, which
identifies and distinguishes the source or origin of a product or service. Other forms of
identifying features which have come to be recognised as trademarks include particular
colour combinations, smells and sounds (for example, an advertisement jingle), textures,
packaging, shapes, etc. The period of protection varies, but a trademark can be renewed
indefinitely upon payment of the corresponding fees.
Design: Design refers to the features of shape, configuration, pattern, ornamentation or composition
of lines or colours applied to any article, in two or three dimensional (or both) forms. It may
be applied by any industrial process or means (manual, mechanical or chemical) separately or
by a combined process, which in the finished article appeals to and is judged solely by the
eye. Term of protection granted is generally five years, with the possibility of further renewal,
in most cases for a period of up to 15 years.
Geographical A geographical indication is a sign used on goods that have a specific geographical origin and
Indication: possess qualities or a reputation due to that place of origin. Most commonly, a geographical
indication consists of the name of the place of origin of the goods.

Timeline of WIPO:

1883 Paris Convention for First step taken to protect intellectual work in other countries.
the Protection of It covers:
Industrial property • Inventions(patents),
• Trademarks,
• Industrial Designs.

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 1886 Berne Convention For the Protection of Literary and Artistic Works.
It covers:
• Novels, short stories, poems, plays;
• Songs, opera, musicals;
• Drawings, paintings, sculptures, architectural works.
1891 Madrid Agreement The first international IP filing service is launched.
1893 BIRPI established Two secretariats set up to administer the Paris and Berne Conventions combine
to form the United International Bureaux for the Protection of Intellectual
Property (BIRPI).
1970 BIRPI becomes WIPO WIPO becomes a member state-led intergovernmental organization.

1974 WIPO joins the United WIPO become one of the agencies of UN.
Nations
1978 Patent Cooperation By filing one international patent application under the PCT, applicants can
Treaty (PCT) system simultaneously seek protection for an invention in a very large number of
launched countries.
1994 Arbitration and The Centre offers alternative dispute resolution services to help solve
Mediation Centre international commercial disputes between private parties.
(AMC) established

Membership of WIPO:
▪ WIPO currently has 191 member states.
▪ All member states of the UN are entitled, though not obliged, to become members of the specialized agencies like
WIPO.
▪ 188 of UN member states as well as Cook Islands, Holy See and Niue are members of WIPO.
▪ Palestine has permanent observer status.
▪ Some 250 non-governmental organizations (NGOs) and intergovernmental organizations (IGOs) have official
observer status at WIPO meetings.
▪ India joined WIPO in 1975.

Functions of WIPO:
▪ Policy forum to shape balanced international IP rules for a changing world.
▪ Global services to protect IP across borders and to resolve disputes.
▪ Technical infrastructure to connect IP systems and share knowledge.
▪ Cooperation and capacity-building programs to enable all countries to use IP for economic, social and cultural
development.
▪ A world reference source for IP information.

Treaties of WIPO:

Name Purpose Acceded/Ratified?

WIPO Performance Deals with the rights of two kinds of beneficiaries, particularly in the India has acceded to
and Phonograms digital environment: this agreement.
Treaty ▪ Performers (actors, singers, musicians, etc.); and
▪ Producers of phonograms (persons or legal entities that take the
initiative and have the responsibility for the fixation of sounds).

Budapest Treaty International Recognition of the Deposit of Microorganisms for the India has acceded to
Purposes of Patent Procedure. the treaty.
Madrid Protocol for Provides for the international registration of trade marks by way of India has acceded to
the International one application that can cover more than one country. the protocol.
Registration of
Marks

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 Marrakesh Treaty The treaty allows for copyright exceptions to facilitate the creation of India has ratified the
to Facilitate Access accessible versions of books and other copyrighted works for visually treaty.
to Published Works impaired persons.
by Visually
Impaired Persons
and Persons with
Print Disabilities
WIPO Copyright A special agreement under the Berne Convention which deals with India has acceded to
Treaty the protection of works and the rights of their authors in the digital the treaty.
environment.

Publications By WIPO:
▪ Global Innovation Index (GII) - an annual ranking of countries by their capacity for, and
success in, innovation.
▪ It is published by Cornell University, INSEAD, and the WIPO, in partnership with other
organisations and institutions.
▪ The 2020 edition of the Global Innovation Index (GII) presents the latest global innovation
trends and the annual innovation ranking of 131 economies.
▪ India has climbed 4 spots and has been ranked 48th (52nd in 2019) by the WIPO in the Global
Innovation Index 2020 rankings.

Components of GII
Five input pillars capture elements of the national 1. Institutions,
economy that enable innovative activities under GII 2. Human capital and research,
are: 3. Infrastructure,
4. Market sophistication, and
5. Business sophistication.
Two output pillars capture actual evidence of 1. Knowledge and technology
innovation outputs: outputs and
2. Creative outputs

India’s performance in 2020:

▪ In midst of the COVID -19 pandemic, it comes as uplifting news for India and is a testament of its robust R&D
Ecosystem.
▪ The WIPO had also accepted India as one of the leading innovation achievers of 2019 in the central and southern
Asian region, as it has shown a consistent improvement in its innovation ranking for the last 5 years.

World Intellectual Property Indicators 2019:

▪ World Intellectual Property Organization (WIPO) has released the World Intellectual Property Indicators 2019.
▪ In 2018, patent filings around the world exceeded by around 3.3 million, representing a 5.2% growth over 2017
figures.
▪ The global growth in IP filings was driven by China which accounted for over 50% of IP filings including
patents, trademarks and design.
▪ The US was ranked second as it witnessed a 1.6% fall in patent filings, which is the first decline for the
country in the previous decade.
▪ India was among the top ten countries of the total (resident and abroad) Intellectual Property (IP) filing activity
by origin.
▪ India saw over 20% growth in trademark filing whereas in respect of industrial design filing activity, it
witnessed a 13.6% rise.

India’s initiatives for IPR protection

WTO: India has been a member of the World Trade Organisation (WTO) since 1995. This requires
member nations to establish Intellectual Property (IP) laws whose effect is in line with

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 minimum standards.
Copyright: India is a signatory to the Berne Convention on copyright. Copyrights Act and Information
Technology Act, 2000 (for copyright in electronics and digital field) govern the laws for
copyright in India.
Patents: India’s Patents Act of 1970 and 2003 Patent Rules govern the law concerning patents. The
regulatory authority for patents is the Patent Registrar within the department of the Controller
General of Patents, Designs and Trade Marks, which is part of India’s Ministry of Commerce
and Industry.
Designs: Law on industrial designs are governed by Designs Act, 2000 under DIPP, Ministry of
Commerce and industry.
Geographical The GIs are governed under Geographical Indications of Goods Act, 1999 under DIPP,
Indications: Ministry of Commerce and industry.
Traditional A Traditional Knowledge Digital Library has been created to safeguard and bring together
Knowledge: traditional knowledge at one platform through collaboration – between the CSIR and
the Department of Ayurveda, Yoga and Naturopathy, Unani, Siddha and Homeopathy (Dept. of
AYUSH), Ministry of Health & Family Welfare, Government of India.

India’s National Intellectual Property Rights (IPR) Policy, 2016

“Creative India; Innovative India: रचनात्मक भारत; अभभनव भारत”

▪ The National IPR Policy is a vision document that encompasses and brings to a single platform all IPRs. It
views IPRs holistically, taking into account all inter-linkages and thus aims to create and exploit synergies
between all forms of intellectual property (IP), concerned statutes and agencies. It sets in place an institutional
mechanism for implementation, monitoring and review. It aims to incorporate and adapt global best
practices to the Indian scenario.
▪ Policy aims to push IPRs as a marketable financial asset, promote innovation and entrepreneurship, while
protecting public interest.
▪ The plan will be reviewed every five years in consultation with stakeholders.
▪ To ensure strong and effective IPR laws, steps would be taken - including review of existing IP laws.
▪ The policy is entirely compliant with the WTO’s agreement on TRIPS.
▪ Special thrust on awareness generation and effective enforcement of IPRs, besides encouragement of IP
commercialisation through various incentives.
▪ India will engage constructively in the negotiation of international treaties and agreements in consultation
with stakeholders.
▪ It suggests making the department of industrial policy and promotion (DIPP) the nodal agency for all IPR
issues.
▪ Copyrights related issues will also come under DIPP’s ambit from that of the Human Resource Development
(HRD) Ministry.
▪ Films, music, industrial drawings will be all covered by copyright.
▪ The Policy also seeks to facilitate domestic IPR filings, for the entire value chain from IPR generation to
commercialisation. It aims to promote research and development through tax benefits.
▪ The policy left the country’s patent laws intact and specifically did not open up Section 3(d) of the Patents Act,
which sets the standard for what is considered an invention in India, for reinterpretation.
▪ Compulsory licensing (CL) remains intact and compliant with TRIPS.

Limitations and Exceptions:

▪ In order to maintain an appropriate balance between the interests of right holders and users of protected works,
copyright laws allow certain limitations on economic rights.
▪ These are cases in which protected works may be used without the authorization of the right holder and with
or without payment of compensation.
▪ Limitations and exceptions is an issue considered in the agenda of the WIPO.
▪ The debate has been focused mainly on three groups of beneficiaries or activities in relation to exceptions and
limitations – on educational activities, on libraries and archives and on disabled persons, particularly
visually impaired persons.

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Chronological development of IPR in India:

1947 Patents & Designs Act, 1911

1995 India joins WTO
1998 India joins Paris Convention/PCT
1999 Patent amendment provided EMR retrospectively from 1/1/95
2005 Patents (Amendment) Act 2005
2013 India was the first country to ratify the Marrakesh Treaty 2013 for Access to copyright works
for visually impaired persons. India also joins Madrid Protocol.
2016 India’s IPR Policy

Way Forward:
▪ India needs a clear and tough stance on intellectual property both in domestic policy and at the multilateral
level.
▪ Support for innovation has to be accompanied with instruments that guard local companies against the misuse
of market power, coercive bargaining and aggressive acquisition strategies.
▪ India needs to spread awareness on IPR in public and for its traditional industries to enable fair monetisation of
IP Rights.
▪ It needs to safeguard its patents, copyrights and traditional knowledge by ensuring easy IPR rules.

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 CH-15 INTERNATIONAL SOLAR ALLIANCE (ISA)
Basics and Background:
▪ The International Solar Alliance is an alliance of more than 120 countries, most of them being sunshine
countries, which come either completely or partly between the Tropic of Cancer and the Tropic of Capricorn.
▪ The primary objective is to collectively work for efficient exploitation of solar energy to reduce dependence on
fossil based fuels.

▪ This initiative was proposed by our Prime Minister of India first during his speech at Wembley Stadium,
London.
▪ This initiative was launched at the India Africa Summit and
a meeting was held among them before the conclave of 2015
United Nations Climate Change Conference in Paris on
November 2015.
▪ This is a treaty-based inter-governmental organization. The
alliance will take the shape of an international treaty once its
rules are worked out.
▪ The Headquarters is in India with its Interim Secretariat
being setup in Gurugram.
▪ The agreement will become operational after at least 15
countries have ratified it.
▪ The framework agreement says that the members of ISA would
take coordinated actions through programmes and activities that will aggregate the demands for solar finance,
solar technologies, innovation, research and development, and capacity building.
▪ The ISA aims to develop cost-efficient solar technologies and applications.
▪ It is also expected to mobilise $1 trillion for funding solar energy projects by 2030.

Objective:
▪ To collectively address key common challenges to scale up solar energy applications in line with their needs
▪ To mobilize investments of more than USD 1000 billion by 2030

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▪ To take coordinated action through programmes and activities launched on a voluntary basis, aimed at better
harmonization, aggregation of demand, risk and resources, for
promoting solar finance, solar technologies, innovation, R&D,
capacity building etc.
▪ Reduce the cost of finance to increase investments in solar energy
in member countries by promoting innovative financial mechanisms
and mobilizing finance from Institutions
▪ Scale up applications of solar technologies in member countries
▪ Facilitate collaborative research and development (R&D)
activities in solar energy technologies among member countries
▪ Promote a common cyber platform for networking, cooperation and
exchange of ideas among member countries.

Target
▪ The ISA has set a target of 1 TW of solar energy by 2030, which would require $ 1 trillion to achieve.
▪ India has set a target of 175 GW of renewable energy capacity by 2022, which includes 100 GW of solar energy.

Focus Area
▪ Grid connected solar power – Solar parks, solar thermal projects, Rooftop solar projects, canal top projects,
Solar on water bodies.
▪ Off-grid and decentralised applications – Village electrification and mini-grids, solar lanterns, mobile chargers,
solar powered telecom towers, solar pumps, etc.

Vision & Mission

▪ Vision – Let us together make the sun brighter.
▪ Mission – Every home no matter how far away, will have a light at home.

Significance:
▪ The role of the International Solar Alliance is extremely important in fulfilling the 2030 SDG goals and
objectives of the Paris Agreement on Climate Change.
▪ India had pledged at the UN Climate Action Summit 2019 to increase the renewable energy capacity of India to
175 gigawatts (GW) by 2022 and further increase it 450 GW.
▪ The alliance objectives include lowering the cost of energy, increasing investment in renewable energy, training
and sharing of knowledge and technology among the member nations.
▪ To sum up, it can be stated that ISA is certainly going to add a new dynamism to energy diplomacy in the 21st
century.

First Assembly of ISA (2018):

▪ For building domestic capacity of the ISA member countries programmes such as STAR - C
Programme, development of the Infopedia etc. have been launched.
o STAR C is a Solar Technology Application Resource Centre project.
o Infopedia is an online platform dedicated to the dissemination of information, best practices and knowledge
on Solar Energy.
▪ The ISA sent country missions to eight countries over the course of 2019 in order to understand the challenges and
issues ‘on the ground’.

328
▪ ISA has significantly extended outreach and have partnered with over 40 organizations. These broadly
include United Nations (UN), Multilateral Development Banks (MDBs), Development Finance Institutions
(DFIs), etc.

Second Assembly of ISA (2019):

▪ The Assembly is the supreme decision making body of the ISA, and gives directions on various administrative,
financial and programme related issues.
▪ India (represented by the Minister for New and Renewable Energy and Power) is the President and France is
the Co-President of the ISA Assembly.
▪ Till now, 81 countries of the 121 prospective member countries have signed the Framework Agreement of the
ISA. Of these, 58 countries have ratified the same.
▪ During the first Assembly of the ISA, an Indian resolution to extend the Membership of the organisation to all
countries that are Members of the United Nations was adopted.

World Solar Technology Summit:

▪ The International Solar Alliance (ISA) to organize the First World Solar Technology Summit on 8th September,
2020 on a virtual platform.
▪ The objective of the event is to bring the spotlight on state-of-the-art technologies as well as next-generation
technologies which will provide impetus to the efforts towards harnessing solar energy more efficiently.
▪ Four Sessions: The event will hold four technical sessions that would be available to the participants in different
languages namely English, Spanish, French & Arabic.

World Solar Bank:

▪ International Solar Alliance (ISA) aims to create a World Solar Bank with authorized capital of $15 billion to
fund projects, a senior official said. A special finance vehicle is needed for funding solar projects.

I JOSE
ISA would also launch the ISA Journal on Solar Energy (I JOSE) that would help authors from across the globe to
publish their articles on solar energy, during the event.

Issues and Challenges:

▪ Many critics are of the opinion that alliance is more a platform for some countries to showcase their technologies
and programmes.
▪ Many member countries of ISA have poor capabilities, therefore they do not know how best to leverage the
platform.
▪ The cost of solar installations remains high in many of the ISA countries. For example – Most African countries
have a high Most Favoured Nation (MFN) tariffs for photo voltaic (PV) cells, modules and semiconductor
devices. Same happens with the Pacific island countries. High tariffs are detrimental to cost effective solar
development.

Way Forward:
▪ There should be greater clarity and better communication so as to convey the purpose of the alliance.
▪ ISA should focus on its core goals i.e. aggregating demand, technical collaborations, and financial assistance for
achieving its target of TW of solar energy by 2030.
▪ ISA should create awareness among the masses with regard to the use and benefits of solar energy. It further
needs to ensure that solar benefits are clear and tangible to users.
▪ ISA should demonstrate business models that are viable for users, suppliers and financiers. Further, the alliance
should support member countries in implementing policies to expedite these business models.

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 CH-16 WORLD BANK
Basics and Background
▪ World Bank (WB) is one of the five institutions created at
Bretton woods in 1944, of which India was a founding member.
▪ World Bank comprises of four institutions:
1. International Bank for Reconstruction and Development
(IBRD)
2. International Development Association (IDA),
3. IFC
4. MIGA
▪ The World Bank group is affiliated to United Nations it maintains
its unique governance structure, with an official goal of “Reduction Of Poverty”, thus directly contributing
towards Sustainable Development Goals.
▪ World Bank has initiated many social development programmes in India ranging from alleviating poverty to
inclusive growth.
▪ Social Development focuses on the need to “put people first” in development processes. Poverty is more than
low income it is also about vulnerability, exclusion, unaccountable institutions, powerlessness, and exposure to
violence.
▪ Social Development promotes social inclusion of the poor and vulnerable by empowering people, building
cohesive and resilient societies, and making institutions accessible and accountable to citizens.
▪ Working with governments, communities (including Indigenous Peoples’ communities), civil society, and the
private sector, Social Development translates the complex relationship between societies and states into
operations.
▪ Empirical evidence and operational experience show that Social Development promotes economic growth and
leads to better interventions and a higher quality of life.
▪ The World Bank’s work in social development supports measures for poor, excluded, and vulnerable women and
men to have equal access to opportunities and to contribute to social and economic progress and share in its
rewards. It brings voices of the poor and vulnerable into development processes by making evidence-based
policy and program contributions.
▪ World Bank has also been actively engaged in improving economic and social status of women, tribals
through targeted programmes so that they can become part of mainstream.
▪ Addressing common needs, overcoming constraints, and giving consideration to diverse interests helps maintain
cohesion and prevents conflict.
▪ The Bank also supports community organization and empowerment to demand more effective, efficient,
responsive, and transparent public institutions and service providers. This approach helps communities confront a
range of negative trends and shocks whether economic, political, or environmental.

Role of Different Institutions under World Bank group:

1. IBRD:
▪ IBRD provides commercial or concessional loan to only sovereign states or projects backed by sovereign
states.
▪ Its loans are aimed to improve transportation and infrastructure, education, domestic policy, environmental
consciousness, energy investments, healthcare, access to food and potable water, and access to improved
sanitation.

2. IDA:
▪ International Development Association (IDA) helps the world’s poorest countries and aims to reduce
poverty by providing interest-free loans (called IDA Credits) and grants for programs that boost economic
growth, reduce inequalities and improve people’s living conditions.

3. International Finance Corporation (IFC):

▪ IFC was created in 1956 to foster private sector investment in developing nations.

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 ▪ It finances the private sector investment, mobilizing capital in the international financial markets, and
providing advisory services to businesses and governments.

4. Multilateral Investment Guarantee (MIGA):

▪ MIGA promotes foreign direct investment (FDI) into developing countries to help support economic
growth, reduce poverty, and improve people’s lives.

Role of World Bank in the Development Project in India

▪ India has been one of the main beneficiaries of developmental assistance from World Bank. India received
support to the tune of USD 5 billion in 2014 for different projects.
▪ Social development projects focusing on areas of community development, health, education, sanitation,
agriculture, women have been an important area where loan assistance from World Bank has been used.
▪ Apart from providing loan assistance, World Bank has been involved in providing knowledge support in
efficient implementation of programmes.
▪ Achievement of MDG and SDG has been an important objective of financial and technical assistance provided by
World Bank. Replicating best practices, innovating has been the main benefits of WB supported programmes.
▪ Focus of good governance, participative approach and community building and thus achieving sustainable
development has been the hallmark of World Bank led projects.

Some of the Important Programmes supported by World Bank

1. The India Elementary Education Project (Sarva Shiksha Abhiyan or SSA):
▪ IDA $1.25 billion over two projects, Specific Investment Loans) is an example of a project that reaches out to
groups that have been excluded, aiming to boost the enrollment of children from poor families, marginalized
and tribal groups and those with special needs.
▪ It has helped the government enroll more than 17 million out-of-school children in elementary school,
including girls, first-generation learners from long-deprived communities and minority communities, and
children with special needs.
▪ The number of out-of-school children declined from 25 million to 8.1 million (less than 5 percent of the age
cohort 6-14).
▪ Approximately 2.9 million children with special needs have been identified and are being covered with a
variety of interventions, like residential centers, home-based education.

2. Bihar Rural Livelihoods Project, popularly known as JEEViKA (livelihoods):

▪ A World Bank project has supported 1.8 million women in rural Bihar to organize themselves into self-
help groups and federations.
▪ Women in Bihar are running commercial organizations like producer companies contributing to increase in
agricultural productivity and realization of better prices of their produce.
▪ The institutional platform of empowered women is now being scaled up by the government of Bihar all over
the state to cover 4.5 million more women.

3. Tejaswini: Socio-economic Empowerment of Adolescent Girls & Young Women Project:

▪ This is the first World Bank project in India that is solely focused on the welfare of adolescent girls and
young women which will support adolescent girls and young women, ages 14-24, to complete their secondary
level education and acquire relevant skills for the job market.

4. Telangana Rural Inclusive Growth Project:

▪ With a support of US$ 75 million project to enhance the agricultural incomes of small and marginal
farmers in the state, and ensure increased access to services related to health, nutrition, sanitation and
social entitlements.
▪ It will focus on increasing economic opportunities for small and marginal farmers, especially from
scheduled caste and scheduled tribe households, by helping them gain access to extension services, quality
inputs like improved seeds, market linkages, and institutional credit.
▪ Investments will also be made in improving access to services in the areas of health, nutrition, water and
sanitation, and increasing coverage and effectiveness of India’s social safety net programs.

5. Nai-Manzil Scheme:

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 ▪ The Government of India and the World Bank today signed a US$ 50 million credit for the Nai Manzil:
Education and Skills Training for Minorities Project to help young people from minority communities
complete their education and gain from market-driven training programs with the aim of improving their
employment outcomes.
▪ The project will support the Government of India’s national Nai Manzil (New Horizon) Scheme, a
comprehensive education and skills development program for youth from minority communities, launched in
August this year.
▪ The project will reach out to disadvantaged youth from minority communities and support their enrolment in
open schooling, as well as provide hands-on vocational training.
▪ It will also provide post-placement support to assist them in finding sustainable employment.

World Bank is also supporting many transport initiatives

▪ National Highway Development Project: The World Bank is financing highway construction on the Lucknow-
Muzaffarpur corridors. It is also involved in other sector activities such as improving road safety.
▪ Rural Roads Program: The project supports the PMGSY in providing all weather roads to villages in four states
– Uttar Pradesh, Jharkhand, Rajasthan and Himachal Pradesh.
▪ State Roads Projects: State Highways are being upgraded in the states of Kerala, Mizoram, Uttar Pradesh, Tamil
Nadu, Punjab, Himachal Pradesh, Orissa and Andhra Pradesh.
▪ Mumbai Urban Transport Project: The project aims to improve transportation in the Mumbai Metropolitan
Region by fostering the development of an efficient and sustainable urban transport system - suburban rail, bus
and link roads - and building effective institutions.
▪ Sustainable Urban Transport Project: The project aims to promote environmentally sustainable urban transport
in various cities and support implementation of the India National Urban Transport Policy (NUTP).

Critical analysis of World Bank:

World Bank faces criticism, and rightfully so, over four key issues:
1. Power distribution
2. Structural Measures
3. Sovereign Immunity
4. Planning and Implementation

1. Power Distribution:
▪ There has been inequitable distribution of voting power ever since the inception of the World Bank. The
World Bank system amounts to $1 = 1 vote. Therefore, richer countries often tend to decide how the
developing nations carry out their developmental process, while they only contribute 14% to the world’s
population.

2. Sovereign Immunity:
▪ The World Bank faces has sovereign immunity from all member countries. This leads to moral injustice as it
is not accountable to its members and does not have a binding obligation to work in their best interests.

3. Structural Measures: The structural measures are arguably the main reasons for the astronomical rise in the
levels of third-world debt.
• Development of exports: The development of exports was encouraged mainly to empower these borrower
countries to procure the foreign currency needed to repay the debt. This led them to, reduce food crops for
local population, to specialize in one or several export crops.
• The complete opening up of markets through elimination of customs barriers: The opening up of markets
matched untrained, less well-equipped local producers against multinational conglomerates, hampering their
livelihood.
• The massive privatization of public companies: The massive privatization of public companies involved
selling them off for a song. As a result, the state lost control of strategic elements for development and
essential services were entrusted to the private sector.

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4. Planning and Implementation: The World Bank has a very poor implementation record in terms of helping
developing countries and has in fact been criticized of extending funds and support with the motive of simply
extending its geopolitical presence in these regions.

333
 (UNIT-7) CH-1 DOUBLE TAX AVOIDANCE
AGREEMENT (DTAA)
Basics and Background:
▪ A DTAA is a tax treaty signed between two or more countries. Its key objective is that tax-payers in these
countries can avoid being taxed twice for the same income. A DTAA applies in cases where a tax-payer resides in
one country and earns income in another.
▪ DTAAs can either be comprehensive to cover all sources of income or be limited to certain areas such as taxing of
income from shipping, air transport, inheritance, etc.
▪ India recently amended its Double Taxation Avoidance Agreement (DTAA) with Mauritius to plug certain
loopholes.
▪ Now, a Mauritian entity will have to pay capital gains tax here while selling shares in a company in India from
April 2017.
▪ Earlier, the company could avoid tax as it was not a ‘resident’ in India. It could get away from the taxman in
Mauritius too, due to non-taxation of capital gains for its residents.
▪ As a result, many shell entities sprang up in Mauritius to profit from investments in India and get away without
paying taxes anywhere.

Importance of DTAA:
▪ DTAAs are intended to make a country an attractive investment destination by providing relief on dual taxation.
▪ Such relief is provided by exempting income earned abroad from tax in the resident country or providing credit to
the extent taxes have already been paid abroad. DTAAs also provide for concessional rates of tax in some cases.

India has DTAAs with which nations?

▪ India has DTAAs with more than eighty countries, of which comprehensive agreements include those with
Australia, Canada, Germany, Mauritius, Singapore, UAE, UK and USA.

What are the benefits of DTAA?

▪ DTAAs are intended to make a country an attractive investment destination by providing relief on dual taxation.
▪ Such relief is provided by exempting income earned abroad from tax in the resident country or providing credit to
the extent taxes have already been paid abroad. For example, if a person is sent on deputation abroad and receive
emoluments during stint away from home, income may sometimes be subject to tax in both the countries.
▪ The person can claim relief when filing tax return for that financial year, if there is an applicable DTAA.
▪ Similarly, if the person is an NRI having investments in India, DTAA provisions may also be applicable to income
from these investments or from their sale. DTAAs also provide for concessional rates of tax in some cases.
▪ For instance, interest on NRI bank deposits attract 30 per cent TDS (tax deduction at source) here. But under the
DTAAs that India has signed with several countries, tax is deducted at only 10 to 15 per cent. Many of India's
DTAAs also have lower tax rates for royalty, fee for technical services, etc.

Categories
▪ The following categories are covered under the Double Taxation Avoidance Agreements (DTAA):
1. services
2. salary
3. property
4. capital gains
5. savings/fixed deposit accounts
Base Erosion and Profit Shifting (BEPS)
▪ BEPS is a term used to describe tax planning strategies that exploit mismatches and gaps that exist between
the tax rules of different jurisdictions.
▪ It is done to minimize the corporation tax that is payable overall, by either making tax profits ‘disappear’ or shift
profits to low tax jurisdictions where there is little or no genuine activity.
▪ In general BEPS strategies are not illegal; rather they take advantage of different tax rules operating in different
jurisdictions.

334
▪ BEPS is of major significance for developing countries due to their heavy reliance on corporate income tax,
particularly from multinational enterprises (MNEs).
▪ The BEPS initiative is an OECD initiative, approved by the G20, to identify ways of providing more standardised
tax rules globally.

India Sri Lanka DTAA Amended

▪ Recently, the Union Cabinet approved the signing and ratification of the protocol amending the agreement
between India and Sri Lanka for the avoidance of double taxation and the prevention of fiscal evasion.
▪ The existing DTAA between India and Sri Lanka was signed on January 22, 2013, and entered into force on
October 22, 2013.
▪ India and Sri Lanka are members of the Inclusive Framework and as such are required to implement the minimum
standards in respect of their DTAAs with Inclusive Framework countries.
▪ India is a signatory to the MLI, however, Sri Lanka is not a signatory to the MLI as of now.
▪ Therefore, amendment of the India-Sri Lanka DTAA bilaterally is required to update the Preamble and also to
insert Principal Purpose Test (PPT) provisions to meet the minimum standards.

335
 CH-2 WASSENAAR ARRANGEMENT
Basics and Background:
▪ It is an elite club of countries which subscribe to arms
export controls, similar to the Nuclear Suppliers Group and
the Missile Technology Control Regime.
▪ The body came into being in 1996 to succeed the Cold War-
era Coordinating Committee for Multilateral Export Controls.
▪ The name comes from Wassenaar, a suburb of The Hague,
where the agreement to start such multi-lateral
cooperation was reached in 1995.
▪ The WA was designed to promote transparency, exchange
of views and information and greater responsibility in
transfers of conventional arms and dual-use goods and
technologies, thus preventing destabilizing accumulations.
▪ It complements and reinforces, without duplication, the existing regimes for non-proliferation of weapons
of mass destruction and their delivery systems, by focusing on the threats to international and regional peace
and security which may arise form transfers of armaments and sensitive dual-use goods and technologies where
the risks are judged greatest.
▪ This arrangement is also intended to enhance co-operation to prevent the acquisition of armaments and
sensitive dual-use items for military end-uses, if the situation in a region or the behaviour of a state is, or
becomes, a cause for serious concern to the Participating States.
▪ The Participating States seek through their national policies to ensure that transfers of arms and dual-use goods
and technologies do not contribute to the development or enhancement of military capabilities that undermine
international and regional security and stability and are not diverted to support such capabilities.
▪ The Arrangement does not impede bona fide civil transactions and is not directed against any state or
group of states.
▪ All measures undertaken with respect to the Arrangement are in accordance with member countries’ national
legislation and policies and implemented on the basis of national discretion.

Member countries
▪ It has 42 members, the latest entrant being India. With the exception of China, all the other permanent
members of the U.N. Security Council are signatories of the WA, which is headquartered in Vienna.
▪ The Arrangement is open on a global and non-discriminatory basis to prospective adherents that comply with
the agreed criteria. To be admitted, a state must: be a producer/exporter of arms or industrial equipment
respectively; maintain non-proliferation policies and appropriate national policies, including adherence to
relevant non-proliferation regimes and treaties; and maintain fully effective export controls.

Five basic principles of Wassenaar Arrangement:

1. It contributes to regional and international security and stability.
2. It promotes transparency and greater responsibility in transfers of conventional arms and dual-use goods and
technologies.
3. It complements and reinforces the export control regimes
for weapons of mass destruction and their delivery
systems.
4. It is not directed against any state or group of states.
5. It uses export controls as a means to combat terrorism.

How does the Wassenaar Arrangement work?

▪ The goal of the Arrangement is to “promote transparency
and greater responsibility in transfers of conventional
arms and dual-use goods and technologies”.
▪ Participants are required to “ensure that transfers of these

336
 items do not contribute to the development or enhancement of military capabilities which undermine the goal”.
▪ The aim, according to WA, is also to prevent the acquisition of these items by terrorists.

Wassenaar Control Lists:

▪ The Arrangement works according to what it calls WA Control Lists. The controls are subject to
ratification by the participants.
▪ WA members agree to exchange information on sensitive dual-use goods and technologies and report on such
transfers and denials of controlled items to non-participants.

India’s entry to the Wassenaar Arrangement:

▪ In a significant victory for its non-proliferation track record, India in the recent past has gained a step ahead
in its elite export control regime becoming the 42nd member of the Wassenaar Arrangement.
▪ Even though India is not a signatory to the Non-Proliferation Treaty, it has managed to make its entry into the
Wassenaar group.
▪ India has managed to do that by updating its export control lists earlier this year, to bring it in line with
international standards, including those required by the Wassenaar Arrangement.
▪ To be precise, India approved SCOMET (Special Chemicals, Organisms, Materials, Equipment, and
Technologies) items, mandatory under the Wassenaar Arrangement. Through the revised list of items, India also
seeks to send a message about its larger commitment to non-proliferation.

Significance of India’s entry:

▪ Earlier India’s efforts at the NSG were stopped by China, which is not a member of the Wassenaar Arrangement.
▪ Wassenaar Arrangement membership is seen as a credit on India’s need for diplomacy in sensitive nuclear issues,
compared to the failed attempt to gain entry to the NSG in 2016.
▪ India’s admittance into the Wassenaar Arrangement will strengthen India’s credentials as a responsible nuclear
power.
▪ India’s WA membership is expected to build up a strong case for India’s entry into the 48-member Nuclear
Suppliers Group (NSG).
▪ Wassenaar Arrangement will also embed India deeper in the global non-proliferation architecture and enable
access to critical technologies in the defence and space sectors.

Other Nuclear Groups:

NSG ▪ The Nuclear Suppliers Group (NSG) is a group of nuclear supplier countries that seeks to
contribute to the non-proliferation of nuclear weapons.
▪ It has 48 members and India is not a member of this group.
▪ Support of international efforts towards non-proliferation of weapons of mass destruction is
the main consideration for the participation in the group.
▪ The NSG Guidelines authorises a member country to transfer only when satisfied that the
transfer would not contribute to the proliferation of nuclear weapons.
MTCR ▪ Missile Technology Control Regime (MTCR) was established in April 1987 by Japan.
▪ It aims to limit the spread of ballistic missiles and other unmanned delivery systems that
could be used for chemical, biological, and nuclear attacks.
▪ It has 35 members, which include most of the world's key missile manufacturers, India is a
member in this group.
▪ It seeks to restrict the exports of missiles and related technologies of any type of weapon of
mass destruction.
Australia ▪ The Australia Group (AG) is an informal forum of countries which, through the
Group harmonization of export controls.
▪ It seeks to ensure that exports do not contribute to the development of chemical or biological
weapons.
▪ It has 42 members and India is not a member of this group.

337
 CH-3 NON-PROLIFERATION TREATY (NPT)
Basics and Background
▪ Treaty on the Non-Proliferation of Nuclear Weapons, commonly known as the Non-Proliferation
Treaty or NPT, is an international treaty whose objective is to prevent the spread of nuclear weapons and
weapons technology, to promote cooperation in the peaceful uses of nuclear energy and to further the goal of
achieving nuclear disarmament and general and complete disarmament
▪ It is the only binding commitment in a multilateral treaty to the goal of disarmament by the nuclear-weapon States
▪ It was opened for signature in 1968 and the Treaty entered into force in 1970.
▪ It was designed to prevent the spread of nuclear weapons, to further the goals of nuclear disarmament and general
and complete disarmament, and to promote cooperation in the peaceful uses of nuclear energy.
▪ Year 2020 marked the 50th anniversary of the entry-into-force of the Treaty on the Non-Proliferation of
Nuclear Weapons (NPT), a legal instrument treated as the cornerstone of the global nuclear non-proliferation
regime.

Three pillars of the treaty

Non-Proliferation

Peaceful use of
Disarmament
Nuclear Energy

Member countries

338
▪ A total of 191 States have joined the Treaty, including the five nuclear-weapon States
▪ Four UN member states have never accepted the NPT, three of which possess or are thought to possess nuclear
weapons: India, Israel, and Pakistan.
▪ In addition, South Sudan, founded in 2011, has not joined.

Objectives:
▪ To further the goal of non-proliferation and as a confidence-building measure between States parties, the Treaty
establishes a safeguards system under the responsibility of the International Atomic Energy Agency (IAEA).
▪ Safeguards are used to verify compliance with the Treaty through inspections conducted by the IAEA.
▪ The Treaty promotes cooperation in the field of peaceful nuclear technology and equal access to this technology
for all States parties, while safeguards prevent the diversion of fissile material for weapons use.
▪ The provisions of the Treaty, particularly article VIII, envisage a review of the operation of the Treaty
every five years, a provision which was reaffirmed by the States parties at the 1995 NPT Review and Extension
Conference.

Implications:
▪ States without nuclear weapons will not acquire them.
▪ States with nuclear weapons will pursue disarmament.
▪ All states can access nuclear technology for peaceful purposes, under safeguards.

Key provisions:
▪ The Treaty defines nuclear weapon states (NWS) as those that had manufactured and detonated a nuclear
explosive device prior to 1 January 1967. All the other states are therefore considered non-nuclear weapon states
(NNWS).
▪ The five nuclear weapon states are China, France, Russia, the United Kingdom, and the United States.
▪ The Treaty does not affect the right of state parties to develop, produce, and use nuclear energy for peaceful
purposes.

Role of States:
▪ Nuclear weapon states are not to transfer to any recipient whatsoever nuclear weapons and not to assist,
encourage, or induce any NNWS to manufacture or otherwise acquire them.
▪ Non-nuclear weapons states are not to receive nuclear weapons from any transferor, and are not to manufacture or
acquire them.
▪ NNWS must accept the International Atomic Energy Agency (IAEA) safeguards on all nuclear materials on
their territories or under their control.

International Atomic Energy Agency (IAEA)

• The International Atomic Energy Agency is the world's central intergovernmental forum for scientific and
technical co-operation in the nuclear field.
• It works for the safe, secure and peaceful uses of nuclear science and technology, contributing to international
peace and security and the United Nations' Sustainable Development Goals.

Why India never signed the treaty?

▪ As per the stance of the Indian Government, the treaty in its current form is unfair as it, virtually, states that the
5 victorious nations of World War II have the right to possess nuclear weapons while condemning the rest of the
nations who don’t have the weapons, to be subservient to the whims and fancies of the nations who do. In short,
the treaty divides the world into nuclear ‘haves’ and ‘have-nots’.
▪ India’s traditional position has always been that either the five nations denuclearize or everyone has the same
rights as those who possess them.
▪ Also escalation of tensions by one of its nuclear-armed neighbours i.e. China was the primary reason why India
conducted its own nuclear tests in the first place.
▪ It is this same escalation by India that prompted Pakistan to conduct its own nuclear test in order to act as a
deterrent to what is perceived as “India’s naked aggression.

Limitations of the Treaty:

339
▪ The main drawbacks of the treaty are that it never held accountable the 5 nations who possessed nuclear
weapons at the time when the treaty was signed.
▪ At the same time, the enforcement of the treaty is also a serious cause for concern. Despite the threat of
economic sanctions and other serious consequences, North Korea detonated its first bomb in 2006. Now even Iran
is poised to go down the same route.
▪ The treaty even has serious loopholes which can be exploited by other nations in order to have their own nuclear
weapons program.
▪ Regardless, it’s clear that the world is a better place because of the Non-Proliferation Treaty. It was predicted that
about 25 nations will possess nuclear weapons. But the mere presence of it has reduced it to 9.
▪ The NPT was not the only reason for this, but the mere presence of the safeguard can at least promise an era of
peace, and if the current loopholes are fixed, it will fulfil such a promise

Peaceful Nuclear Explosions:

▪ Peaceful nuclear explosions (PNEs) are nuclear explosions conducted for non-military purposes.
▪ The US proposed to prohibit PNE rights and instead offered to provide the technology on a commercial basis.
▪ The Indian representatives consistently termed the offer as 'atomic apartheid' and 'commercial super-monopoly,'
and insisted that PNE rights need to be integral to all peaceful uses of nuclear energy.
▪ India conducted its first PNE in 1974 in opposition to this discriminatory principle.

Post-Cold War Challenges:

▪ The treaty’s existential challenges began in the post-Cold War setting when the attempts by a few State Parties to
break-out or gain nuclear latency led to numerous instances of non-compliance, violations and defiance.
▪ The NPT’s indefinite extension in 1995, while invoking its irreplaceability, also underlined the inability of states
to formulate a stand-alone instrument towards the objective of disarmament, as enshrined in the NPT.
▪ The emergence of non-state actors with declared intent to access weapons of mass destruction and the detection of
a global nuclear black-market, has raised concerns on the limitations of the treaty to address the challenges thrown
up by the new strategic milieu.

Way Forward:
▪ Rising energy demands have led to a growing number of countries pursuing nuclear energy, and many countries
wish to be energy-independent, in order to ensure a sustainable and dependable domestic energy supply. As clean
energy, development, and peaceful coexistence are essential for every country.
▪ Thus, the challenge for the international community will be to reconcile states’ desire for energy independence
with their desire to both reduce the intrusiveness of IAEA safeguards and diminish the possibility of proliferation.
▪ Also, NNWS welcomes New START and other initiatives, but is anxious to see more concrete actions on
reducing the role of nuclear weapons in national security doctrines, reducing alert levels, increasing transparency,
and other steps.
▪ More regions in the world (preferably comprising NWS) should enter into an arrangement of
establishing Nuclear-weapon-free zones.
▪ Further, Treaty on the Prohibition of Nuclear Weapons is a step in the right direction for nuclear disarmament.

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 CH-4 NUCLEAR SUPPLIER GROUP (NSG)
Basics and Background

▪ The Nuclear Suppliers Group (NSG) is a multilateral export control regime and a group of nuclear supplier
countries that seek to prevent nuclear proliferation by controlling the export of materials, equipment and
technology that can be used to manufacture nuclear weapons.
▪ The NSG was founded in response to the India’s nuclear test in May 1974 and first met in November 1975.
▪ The NSG first met in November 1975 in London, and is thus popularly referred to as the “London Club”.
▪ The test demonstrated that certain non-weapons specific nuclear technology could be readily turned to weapons
development.
▪ Nations already signatories of the Nuclear Non-Proliferation Treaty (NPT) saw the need to further limit the
export of nuclear equipment, materials or technology.
▪ Another benefit was that non-NPT and non-Zangger Committee nations, then specifically France, could be
brought in.
▪ It is not a formal organization, and its guidelines are not binding. Decisions, including on membership, are
made by consensus.
▪ Membership till now is to 48 supplier states.

Objective:
▪ It aims to ensure that nuclear trade for peaceful purposes does not contribute to the proliferation of nuclear
weapons or other nuclear explosive devices, while not hindering international trade and cooperation in the nuclear
field.
▪ It facilitates the development of peaceful nuclear trade by providing the means whereby obligations to facilitate
peaceful nuclear cooperation can be implemented in a manner consistent with international nuclear non-
proliferation norms.

Criteria for Membership:

▪ The ability to supply items (including items in transit) covered by the annexes to Parts 1 and 2 of the NSG
Guidelines;
▪ Adherence to the Guidelines and action in accordance with them;
▪ Enforcement of a legally based domestic export control system which gives effect to the commitment to act in
accordance with the Guidelines;
▪ Full compliance with the obligations of one or more of nuclear non-proliferation agreement.

341
▪ Support of international efforts towards non-proliferation of weapons of mass destruction and of their delivery
vehicle.

Benefits for the members:

▪ Timely information on nuclear matters.
▪ Contributes by way of information.
▪ They will have confirmed credentials.
▪ They can act as an instrument of harmonization and coordination.
▪ It is a part of a very transparent process.

MTCR
• Established in April 1987, the voluntary Missile Technology Control Regime (MTCR) aims to limit the spread of
ballistic missiles and other unmanned delivery systems that could be used for chemical, biological, and nuclear
attacks.
• The regime urges its 35 members, to restrict their exports of missiles and related technologies capable of carrying
a 500-kilogram payload at least 300 kilometers or delivering any type of weapon of mass destruction.

Wassenaar Arrangement
• The Wassenaar Arrangement has been established in order to contribute to regional and international security and
stability, by promoting transparency and greater responsibility in transfers of conventional arms and dual-use
goods and technologies, thus preventing destabilising accumulations.
• The aim is also to prevent the acquisition of these items by terrorists.

Australia Group
▪ The Australia Group (AG) is an informal forum of countries which, through the harmonisation of export controls,
seeks to ensure that exports do not contribute to the development of chemical or biological weapons.
▪ The formation of the Australia Group (AG) in 1985 was prompted by Iraq’s use of chemical weapons during the
Iran-Iraq War (1980-1988)
▪ Coordination of National export control measures assists Australia Group members to fulfil their obligations under
the Chemical Weapons Convention and Biological & Toxin Weapons Convention.
▪ The Australia Group has a list of 54 compounds that are identified to be regulated in global trade. This list
includes more items than the Chemical Weapons Convention.

India’s Quest for NSG Membership

▪ Since 2008, India has been trying to join the group.
▪ India submitted its membership application to the NSG in May 2016, a month before the Seoul plenary of the
Group. However, at the Seoul plenary group, India’s membership was blocked by China.
▪ Again, in Nur-Sultan (Kazakhstan) on 21st June 2019, China blocked the India’s membership and has clarified
that India’s membership of the Nuclear Suppliers Group (NSG) was not on the agenda of the plenary of the
grouping.

Why the membership is important for India?

▪ Membership will increase India’s access to state-of-the-art technology from the other members of the
Group.
▪ Access to technology and being allowed to produce nuclear equipment will give a boost to the Make in India
program. That will, in turn, boost the economic growth of our country.
▪ As per India’s INDC under the Paris Climate agreement, India have committed to reducing dependence on fossil
fuels and ensuring that 40% of its energy is sourced from renewable and clean sources. In order to achieve this
target, India need to scale up nuclear power production. This can only happen if India gains access to the
NSG.
▪ Namibia is the fourth-largest producer of uranium and it agreed to sell the nuclear fuel to India in 2009.
However, that hasn’t happened, as Namibia has signed Pelindaba Treaty, which essentially controls the supply of
uranium from Africa to the rest of the world. If India joins the NSG, such reservations from Namibia are expected
to melt away.

342
▪ India will get an opportunity to voice it’s concern if in case of change in the provision of the NSG
guidelines.

INDIA’S NUCLEAR DOCTRINE

▪ No First Use
1. India will only use nuclear weapons in response to a nuclear attack on Indian territory, or Indian forces.
2. A caveat is made about their possible use in response to a chemical or biological attack.
▪ Massive Retaliation
1. India’s response to a first strike will be massive, to cause ‘unacceptable damage’.
2. While the doctrine doesn’t explicitly espouse a counter-value strategy (civilian targets), the wording implies the
same.
▪ Credible Minimum Deterrence
1. The number and capabilities of India’s nuclear weapons and delivery systems should merely be sufficient to
ensure intolerable retaliation, also keeping in mind first-strike survival of its relatively meagre arsenal.

Impediments in India’s membership to NSG:

▪ Since all decisions at NSG (including on membership) are taken by consensus, any country, small or big, can
stand in the way of a consensus.
▪ Non-signatory to NPT: India is not eligible to become a member of the NSG as it is not a member of the nuclear
non-proliferation treaty (NPT), adherence to latter is necessary for membership in the former.
▪ Norm-based entry: China has also averred that for non-NPT members some definite criteria should be evolved
rather than granting country specific waivers. No single country waiver should be granted to India as was done in
2008.
▪ Linking India’s membership with Pakistan: At other times, China has stated that Pakistan also has similar
credentials to join the NSG; and that if India is admitted, Pakistan should also be admitted simultaneously.
▪ Will fuel nuclear arms race in South Asia: If only India were to be admitted, it would disturb the nuclear-arms
balance in South Asia as India will engage in a massive nuclear weaponization programme.

India’s response to China’s apprehension:

▪ Nine General Commitment: A new draft formula proposes "nine general commitments" that non-NPT
countries "would need to make" in order to receive the "fullest" atomic trading privileges. According to analysts,
India already fulfils all these nine criteria for becoming a NSG member.
▪ NPT membership is not mandatory: According to the guidelines adopted in 2001 at Aspen, membership of NPT
is not a pre-condition for becoming a NSG member. It is only a guiding principle to which consideration needs to
be given.
▪ Impeccable track record: If the NSG granted waiver to India in 2008 on the basis of its past performance, then
it should have no objection in admitting India as a member because of India’s impeccable track-record in
observing the provisions of the NPT and NSG, even though it has not been a member of either any of them.
▪ India’s view on Pakistan’s membership to NSG: Pakistan’s credentials for NSG membership are highly flawed
and inadequate. Pakistan has a blemished and flawed proliferation record as it has engaged in illicit supply of
nuclear technology and materials to Iran, Libya and North Korea.
▪ On nuclear arms race: Since 2008, as per its commitment, India has separated its civilian and military nuclear
programmes, and put the civilian part under International Atomic Energy Agency safeguards.
▪ India’s view on criteria-based membership: India maintains that rather than evolving criteria, its performance
should be the basis of its track record.

Way Forward:
▪ India should convince China that, its interest in NSG membership is not guided by any political or strategic
considerations but only to facilitate the expansion of its clean and green nuclear energy programme.
▪ Besides, India should continue with a low-key building of partnership with other NSG members.
Meanwhile, India should focus on developing the efficient green energy technologies to meet the massive
energy requirement.
▪ India has in recent times emerged as major global player in all respects and the global foras’ must recognize the
importance of this.

343
▪ China also must see it as an important confidence building step. If it does not block India’s membership it can
have huge positive effects on the relationship between the two countries. India on its part must be ready for some
hard and smart diplomatic efforts with China on the issue.

344
 CH-5 HAGUE CODE OF CONDUCT (HCOC)
Basics and Background
▪ The HCoC is a voluntary, legally non-binding international confidence building and transparency
measure that seeks to prevent the proliferation of ballistic missiles that are capable of delivering weapons of
mass destruction.
▪ The HCoC was formally brought into effect on November 25, 2002, at a launching conference hosted by the
Netherlands in The Hague.
▪ The Hague Code of Conduct against Ballistic Missile Proliferation (HCoC) is the result of efforts of the
international community to internationally regulate the area of ballistic missiles capable of carrying weapons
of mass destruction.
▪ Along with the MTCR, the HCOC is the only multilateral transparency and confidence building instrument
concerning the spread of ballistic missiles.
▪ By subscribing to the HCoC, members voluntarily commit themselves politically to provide pre-launch
notifications (PLNs) on ballistic missile and space-launch vehicle launches (SLVs) and test flights.
Subscribing States also commit themselves to submit an annual declaration (AD) of their country’s policies on
ballistic missiles and space-launch vehicles.
▪ As of February 2020, 143 countries have subscribed to the HCoC

BALLISTIC MISSILE
It is a missile with a high, arching trajectory which is initially powered and guided, but falls under gravity on to its
target. Most of its trajectory is unpowered and governed by gravity and air resistance if it is in the atmosphere. In
contrasts, cruise missiles are aerodynamically guided in powered flight.

Objective
▪ The HCoC aims to contribute to the process of strengthening existing national and international security
arrangements and disarmament and non-proliferation objectives and mechanisms.
▪ Participants recognize a need to prevent and curb the proliferation of ballistic missile systems capable of
delivering weapons of mass destruction, as well as the importance of strengthening, and gaining wider adherence
to, multilateral disarmament and non-proliferation mechanisms.
▪ To meet these objectives, participants try to exercise maximum possible restraint in the development, testing,
and deployment of ballistic missiles capable of carrying weapons of mass destruction.

Relevance of HCoC in MTCR

▪ The HCoC complements the important, ongoing work of the MTCR.
▪ All states, whether or not they are members of the MTCR are encouraged to join the HCoC, which reflects the
founding States’ intent to make the Code universally accepted.

India joins The Hague Code of Conduct

▪ India’s joining HCoC strengthened the worldwide attempt to contain the spread of ballistic missiles
▪ It signals our readiness to further strengthen the global non-proliferation regimes
▪ HCoC has been focused on West Asia, South Asia and the East Asia due to the rising missile and nuclear arms
race among rival powers
▪ In the meeting of the HCoC held in 2015, a special mention was made of the increased number of missile launches
by North Korea.
▪ India is on track for membership in other technology regimes like the Missile Technology Control Regime

345
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 CH-6 UNITED NATIONS CONVENTION ON THE
LAW OF THE SEA (UNCLOS)
Basics and Background:
▪ The United Nations Convention on the Law of the Sea (UNCLOS) is an international treaty which was adopted
and signed in 1982.
▪ It replaced the four Geneva Conventions of April, 1958, which respectively concerned the territorial sea and
the contiguous zone, the continental shelf, the high seas, fishing and conservation of living resources on the
high seas.

Three new institutions created by the convention:

▪ International Tribunal for the Law of the Sea,
▪ International Seabed Authority,
▪ Commission on the Limits of the Continental Shelf.

UNCLOS Features:
▪ Nations are provided with full money rights by UNCLOS for a 200-mile zone along the shoreline.
▪ The sea and oceanic bed extending to this area are regarded to be the Exclusive Economic Zone (EEZ) of a
country and that country can use these waters for their economic utilization.
▪ Another important organization that plays a vital role in UNCLOS operations is the International Maritime
Organization (IMO).
▪ Other important parties involved in Nautical Law and its functioning are the International Seabed Authority
and the International Whaling Commission.

INTERNATIONAL WHALING COMMISSION

▪ It is an international body set up under International Convention for the Regulation of Whaling (ICRW).
▪ ICRW governs the commercial, scientific, and aboriginal subsistence whaling practices of fifty-nine member
nations. It was signed in Washington, D.C., United States, in 1946.
▪ Headquarters — Impington, near Cambridge, England.
▪ In 1986, it adopted a moratorium on commercial whaling. This ban still continues.

Maritime Zones:

▪ Baseline:
o It is the low-water line along the coast as officially recognized by the coastal state.

▪ Internal Waters:

346
 o Internal waters are waters on the landward side of the baseline from which the breadth of the territorial sea is
measured.
o Each coastal state has full sovereignty over its internal waters as like its land territory. Examples of internal
waters include bays, ports, inlets, rivers and even lakes that are connected to the sea.
o There is no right of innocent passage through internal waters.
o The innocent passage refers to the passing through the waters which are not prejudicial to peace and security.
However, the nations have the right to suspend the same.

▪ Territorial Sea:

o The territorial sea extends seaward up to 12 nautical miles (nm) from its baselines.
o The coastal states have sovereignty and jurisdiction over the territorial sea. These rights extend not only
on the surface but also to the seabed, subsoil, and even airspace.
o But the coastal states’ rights are limited by the innocent passage through the territorial sea.

Nautical Mile
A nautical mile is based on the circumference of the earth and is equal to one minute of latitude. It is slightly more
than a land measured mile (1 nautical mile = 1.1508 land miles or 1.85 km).
▪ Contiguous Zone”:

o The contiguous zone extends seaward up to 24 nm from its baselines.

o It is an intermediary zone between the territorial sea and the high seas.
o The coastal state has the right to both prevent and punish infringement of fiscal, immigration, sanitary,
and customs laws within its territory and territorial sea.
o Unlike the territorial sea, the contiguous zone only gives jurisdiction to a state on the ocean’s surface and
floor. It does not provide air and space rights.

▪ Exclusive Economic Zone (EEZ):

o Each coastal State may claim an EEZ beyond and adjacent to its territorial sea that extends seaward up to 200
nm from its baselines.
o Sovereign rights for the purpose of exploring, exploiting, conserving and managing natural resources, whether
living or nonliving, of the seabed and subsoil.
o Rights to carry out activities like the production of energy from the water, currents and wind.
o Unlike the territorial sea and the contiguous zone, the EEZ only allows for the above-mentioned resource
rights. It does not give a coastal state the right to prohibit or limit freedom of navigation or
overflight, subject to very limited exceptions.

▪ High Seas:

o The ocean surface and the water column beyond the EEZ are referred to as the high seas.
o It is considered as “the common heritage of all mankind” and is beyond any national jurisdiction.
o States can conduct activities in these areas as long as they are for peaceful purposes, such as transit,
marine science, and undersea exploration.

‘Enrica Lexie’ case:

▪ In Feb 2012, two Italian Marines Massimiliano Latorre and Salvatore Girone on board an Italian oil tanker
“Enrica Lexie” had opened fire on a fishing St.Antony boat and killed two fishermen Ajeesh Pink and Valentine
Jelastine mistaking them as pirates.
▪ The incident took place in the contiguous zone waters at a distance of 20.5 nautical miles off Kerala coast and
the marines were arrested on murder charges by India.
▪ Italy challenged the arrest of marines before Kerala High Court stating that India has no jurisdiction to try Italian
naval marines. Italy provoked Article 97 of the United Nations Convention on the Law of the Sea
(UNCLOS).
▪ The matter was taken up by the Supreme Court and the apex court ruled that as per the Indian government
notification issued in pursuant of the Convention on the Law of the Sea, India has jurisdiction over the entire 200-

347
 mile Exclusive Economic Zone, and thus the case can be triable in India. It mentioned that only the Indian
Government can exercise jurisdiction, not the state government.
▪ In 2015 Italy approached the International Tribunal for the Law of the Sea, an arbitral tribunal under the
International Court of Justice and filed an arbitration case under Annex VII of UNCLOS.
▪ A tribunal was established by the International Tribunal for the Law of the Sea (ITLOS) under the provisions
of the United Nations Convention on the Law of the Sea (UNCLOS). The ITLOS ruling of 2015 asked Italy
and India to suspend all prosecutions in the case. Both Italian marines returned from India to Italy in 2014 and in
2016 respectively.
▪ The Permanent Court of Arbitration heard the case in July 2019.
▪ Recently, India lost jurisdiction over two Italian marines who are facing charges of killing two Indian
fishermen in the “Enrica Lexie” case.
▪ Italy, since the beginning, has been trying for domestic trails of the marines in Italy. Now as per the new verdict
the case will not stand trial in India, and the marines will face criminal proceedings in Italy.
▪ This case and its progress have soured the diplomatic relations between India and Italy.

International Tribunal for the Law of the Sea

▪ It is a multi-governmental establishment formed by the mandate of the 3rd UN Conference on the Law of the Sea.
It was established in 1996 and has headquarters in Hamburg, Germany. It adjudicates on disputes relating to the
interpretation and application of the United Nations Convention on the Law of the Sea.
▪ It has jurisdiction to resolve a variety of international law of the sea disputes such as the delimitation of maritime
zones, fisheries, navigation and the protection of the marine environment.

Philippines decided to resume oil exploration in its EEZ:

▪ Philippine government has decided to resume oil exploration in its exclusive economic zone, a 320-km stretch of
waters where a coastal state can exclusively exploit maritime resources under the 1982 U.N. Convention on the
Law of the Sea.
▪ This includes Reed Bank, which China also claims. This region is located in the disputed South China Sea.

South China Sea:

▪ South China Sea is an arm of western Pacific Ocean in Southeast Asia.
▪ It is south of China, east & south of Vietnam, west of the Philippines and north of the island of Borneo.
▪ Bordering states & territories (clockwise from north): the People’s Republic of China, the Republic of China
(Taiwan), the Philippines, Malaysia, Brunei, Indonesia, Singapore and Vietnam.
▪ It is connected by Taiwan Strait with the East China Sea and by Luzon Strait with the Philippine Sea.
▪ It contains numerous shoals, reefs, atolls and islands. The Paracel Islands, the Spratly Islands and the
Scarborough Shoal are the most important.

Claims of different Countries:

▪ China
o Claims by far the largest portion of territory – an area defined by the “nine-dash line” which stretches
hundreds of miles south and east from its most southerly province of Hainan.
▪ Vietnam
o hotly disputes China’s historical account, saying China had never claimed sovereignty over the islands before
the 1940s. Vietnam says it has actively ruled over both the Paracels and the Spratlys since the 17th Century –
and has the documents to prove it.
▪ Philippines
o both the Philippines and China lay claim to the Scarborough Shoal (known as
Huangyan Island in China) – a little more than 100 miles (160km) from the
Philippines and 500 miles from China.
▪ Malaysia and Brunei
o They lay claim to territory in the South China Sea that they say falls within their
economic exclusion zones, as defined by UNCLOS – the United Nations
Convention on the Law of the Sea. Brunei does not claim any of the disputed
islands, but Malaysia claims a small number of islands in the Spratlys.

348
What makes it so important?

▪ This sea holds tremendous strategic importance for its location as it is the connecting link between the Indian
Ocean and the Pacific Ocean. (Strait of Malacca)
▪ According to the United Nations Conference on Trade And Development (UNCTAD) one-third of the global
shipping passes through it, carrying trillions of trade which makes it a significant geopolitical water body.
▪ According to the Department of Environment and Natural Resources, Philippines, this sea has one-third of
the entire world’s marine biodiversity and contains lucrative fisheries providing food security to the Southeast
Asian nations.
▪ South China Sea is believed to have huge oil and gas reserves beneath its seabed.

United Nations Conference on Trade And Development (UNCTAD)

▪ Permanent intergovernmental body established by the United Nations General Assembly in 1964.
▪ Headquartered in Geneva, Switzerland.
▪ Part of the UN Secretariat and the United Nations Development Group.
▪ Main UN body dealing with trade, investment and development issues.

349
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