September 3, 2011

Give Dhaka its due

Clearly, Delhi has decided to aggressively engage with Dhaka. The flurry of activity began in early May, with Vice President Hamid Ansari travelling to Dhaka to jointly inaugurate the Indo-Bangladeshi celebrations of the 150th birth anniversary of Tagore. In June, Foreign Secretary Nirupama Rao was in Dhaka for talks. In July, there were visits by UPA Chairperson Sonia Gandhi, External Affairs Minister SM Krishna and Home Minister P. Chidambaram. Also in July, Commerce and Industry Minister Anand Sharma travelled to the Bangladesh border with the West Garo Hills district of Meghalaya. His mission: to join his Bangladeshi counterpart in inaugurating a Border Haat for rural trade.

Sonia Gandhi was in Dhaka to accept the highest state award of Bangladesh on behalf of her mother-in-law, Indira Gandhi. By honouring Indira, Dhaka has exposed the hollowness of the criticism, often heard in India, that Dhaka has “forgotten” the role India played in the liberation of Bangladesh. In fact, from the lukewarm coverage that Delhi’s mainstream press gave to the award ceremony, it seemed it was Indians who suffered from amnesia.

Dhaka’s graciousness in honouring Indira was of a piece with the maturity it displayed a few weeks ago when it made light of the PMO’s faux pas in failing to expunge Dr. Manmohan Singh’s off-the-record statement on the extent of anti-Indian sentiment in Bangladesh. The statement had the potential to cause a significant dent in bilateral ties. But Dhaka refused to make an issue of it.

Photo: Peter Russell

Photo: Peter Russell

Also boding well for improved bilateral ties was the recent Supreme Court decision to lift its 17-month old stay on limestone mining by French multinational Lafarge in Meghalaya to provide feedstock to its cement plant in Bangladesh. The Indo-Bangladesh operations of Lafarge are a symbol of economic interdependence between the two countries. Lafarge, the global leader in cement, has set up a unique two-nation industrial project across the two sides of the Indo-Bangladesh border in the Meghalaya-Sylhet region. The USD255 million cement plant is located at Chhatak, Bangladesh. Raw material for the plant, comprising limestone and shale, comes from quarries in East Khasi Hills, Meghalaya via a 17-km long belt conveyor.

Certain quarters opposed to the Meghalaya mining project had raised the bogey of environmental damage and taken the matter to the Supreme Court. In February, 2010, the Court had barred limestone mining by Lafarge.

The Government of India made a strong plea for the lifting of the ban, citing international commitments and bilateral relations. The viability of the cement plant in Bangladesh would be threatened if limestone supplies from India were not assured. The decision of the Indian Supreme Court is widely seen as giving a boost to ties with Dhaka, not the least because it ensures that India’s critics in that capital have one thing less to gripe about.

There is an air of expectancy in the two capitals today. It is expected that Dr. Manmohan Singh’s September visit to Dhaka will lead to further cementing of ties. And yet there is no denying that there is also, in both Delhi and Dhaka, a very strong feeling of under-realisation of potential: “Look at the end of work, contrast ; The petty done, the undone vast.” And sadly, it is India that is seen as the laggard in this respect.

In Prime Minister Sheikh Hasina, India has a friend of a kind that it has not had in its neighbourhood in a long time. Under her watch, Bangladesh has ceased to be a safe haven for militants and separatists of all hues fleeing from the law in India’s unsettled Northeast. Given the fact that Delhi has been driven up the wall by an unhelpful, and even hostile, Pakistan in the west, a friendly neighbour in the east should be a strategic goal for India.

Economically, a stable Bangladesh that is willing to exploit the fullest potential of neighbourly interdependence can do wonders for India, especially in its Northeast. Bangladesh is an investment destination whose depths are yet to be plumbed by Indian business. Barring the experience of the Tatas, Indian companies that have ventured there have done very well. Marico is the fastest growing FMCG company in Bangladesh. Marico’s Parachute is the biggest FMCG brand there.

On the other hand, India can and should do a lot more to mitigate the huge trade imbalance between the two countries.

Dhaka complains of restricted market access. It cannot understand why Delhi must have a negative list of 48o items for import from Bangladesh. Why must Delhi be so niggardly in increasing the quota of Bangladeshi garments that can be imported duty-free by India? After all, India is assured of quality and price, and Indian businessmen can also gain by making investments in this industry in Bangladesh.

Strategic analysts in Dhaka complain that from a policy perspective, India’s mindspace seems to be almost entirely occupied by its western neighbour. This is odd considering that India shares a longer border with Bangladesh than with Pakistan. Sure, Pakistan is a nuclear power and believes in using terrorism as an instrument of state policy. But equally, Bangladesh can directly or indirectly contribute to both keeping eastern India on the boil and holding it back from speedy economic development.

On the face of it, the spate of high level engagements with Bangladesh in recent months seems to indicate that Delhi’s ostpolitik is finally one of resolving outstanding issues and optimising good relations with Dhaka. But if Delhi’s Dhaka policy is to succeed, it must cease to be seen as the overbearing Big Brother. Influential sections of India’s decision-making apparatus must shed their distrust of Dhaka. Until that happens, policy-making will suffer. Equally important is the need to drive Indian bureaucracy to move expeditiously on all outstanding issues.

On balance, thanks to Prime Minister Sheikh Hasina’s commitment to Indo-Bangla ties and some decisive moves from India’s political leadership, bilateral relations are better today than ever before in recent years and hold the promise of ushering in a new paradigm in regional cooperation.

Dr. Manmohan Singh has spoken in the past of his vision of making borders irrelevant. That was more in the context of India’s western borders. Today, there is an opportunity to actually do so in the East. A trans-border connectivity revolution and turning Bangladesh into a regional transit hub can transform the economies of both Bangladesh and our Northeast. For starters, the two countries can go back to the pre-1965 days when there was free movement of goods and people across international borders through what was then East Pakistan.

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