Africa, Mozambique, Madagascar, Australia and French Polynesia, Clipping New Caledonia, Fiji, Tonga and The Cook Islands Before Landfall at Pitcairn

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Which countries does the Prime Meridian pass through?

In the Northern Hemisphere, the Prime Meridian passes through


theUK, France and Spain in Europe and Algeria, Mali, Burkina, Faso, Tongo and Ghana in Africa. The only landmass crossed
by the Meridian in the Southern Hemisphere is Antarctica.

Which countries does the Prime Meridian pass through? In the Northern Hemisphere, the Prime Meridian passes through
theUK, France and Spain in Europe and Algeria, Mali, Burkina, Faso, Tongo and Ghana in Africa. The only landmass crossed
by the Meridian in the Southern Hemisphere is Antarctica.

The Tropic of Cancer and the Tropic of Capricorn each lie at 23.5 degrees latitude. The Tropic of Cancer is located at around
23.5° North of the equator and runs through Mexico, the Bahamas, Egypt,Saudi Arabia, UAE, Oman, India, and
southernChina.

The line passes through Chile, Argentina, Paraguay, Brazil, Namibia, Botswana,South
Africa, Mozambique, Madagascar, Australia and French Polynesia, clipping New Caledonia, Fiji, Tonga and the Cook
Islands before landfall at Pitcairn.
India Pakistan Relations
Hindu ruler Hari Singh tried to negotiate with India & Pak to have an independent status for his state. Since majority
population of the state was Muslim, the Pakistan thought Kashmir ‘belonged‘ to them.
On 15th August Harisingh offered standstill agreement with both countries which allowed the free movement of
people & goods. Pakistan signed the agreement but India didn’t. Pakistan became impatient & started violating
standstill agreement. 24th October Hari Singh demanded military assistance from India. Mountbatten pointed out that
under international law India can send its troops only after state signs a formal instrument of accession – on 26thOct
Maharaja signed instrument of accession – ratified in 1954.
On 27th Oct. morning nearly 100 planes airlifted men and weapons to Srinagar. Pakistan army left the main valley
region but continue to occupy a large chunk of territory of Gilgit, Baltistan region – Pak occupied Kashmir.
At the same time India lodged complaint against Pakistan for their illegal actions in UN. Instead of getting justice at
UN, Western powers backed Pakistan. India also accepted UN resolution on ceasefire in spite of its advantageous
position and agreed for plebiscite in Kashmir, which laid down two conditions for holding plebiscite –
 Pak should withdraw its forces from the state of J&K
 The authority of the Srinagar administration should be restored over the whole state
 Above mentioned first conditions was never fulfilled, so there was no plebiscite there.

 Meanwhile J&K participated in India’s general elections and then the talk of plebiscite remained irrelevant.
Kashmir conflict didn’t prevent cooperation between governments of India & Pak. Both the governments worked
together to restore the abducted women to their original families, a long term dispute of river water sharing was
resolved – with world Bank’s mediation and India-Pakistan Indus Water Treaty was signed by Nehru and General
Ayub Khan in 1960.

India Pakistan Wars


1965 India Pakistan War
 Pakistan launched armed attacks in the Rann of Kutch area of Gujarat, later it launched bigger offensive in J & K in
1965.
 Pakistan thought that this time the local population would support the cause of Pakistan, but nothing of this sort
happened.
 Meanwhile, in order to ease the pressure from Kashmir front, Shastri ordered Indian troops to launch counter
offensive on the Punjab border.
 War was won by India, and the hostilities came to an end with UN intervention.

Due to the mediation of Soviet Union, Both the countries signed the Tashkent Agreement [Shastri from India &
General Ayub Khan from Pak] in January 1966. Although India won the war, this war added India the economic
difficulties.

1971 India Pakistan War


The internal crisis of Pakistan after the verdict of their general elections turned violent. Ruling party of Zulfikar
Bhutto emerged as winner in West Pakistan while in Eastern Part Rahman’s Awani League won with great margins.
However, strong and powerful western establishment ignored the democratic verdict and didn’t accept the League’s
demand for federation. Instead of responding to their demands and verdict positively, Pak army arrested Rahman and
unleashed brutal terror activities and suppressed their voices.
 To end this menace permanently, people of Eastern Pak started liberation struggle of Bangladesh from Pak.
 Due to the huge influence of refugees from Eastern Pak, India deliberated much and later extended its support to
people’s cause materially and morally, which was frowned by Western Pak as Indian conspiracy to break of
Pakistan.
 The support to Western Pak came from the USA & China to quash the people’s movement.
 To ensure its safety from the attacks of American and Chinese backed Pak, India signed 20 year Treaty of Peace
and Friendship with the Soviet Union.
 Even after much diplomatic deliberations no concrete results could be achieved, and full scale war broke out in
1971 on both the western and Eastern front.
 With the support of local population in the form of “Mukti Bahini” Indian army made rapid progress and compelled
the Pakistani troops to surrender in 10 days only.
With emergence of Bangladesh as an independent country, India declared a unilateral ceasefire. Later Shimla
Agreement of 1972 between Indira Gandhi & Zulfikar Bhutto brought back the peace between two nations.

Kargil War
After the debacle of 1971 war, Pak army never tried to fight with Indian army directly & started the proxy war by
sending the terrorists trained by their secret agencies to create havoc and panic in J & K and India.
 In 1999, so called Mujahideens occupied several points on the Indian side of LOC in the Mashkoh, Dras, Kaksar,
Batalik.
 Suspecting Pak’s hand behind such activities, Indian forces immediately started retaliating to such proxy war which
is known as “Kargil conflict”.
 This conflict got worldwide attention because of the nuclear capabilities attained by these countries in 1998, which
could be used by either side, however nuclear weapons were not used in war, and Indian troops regained their
points.

There was huge controversy surrounding this Kargil conflict, that, the then PM of Pak was kept in the dark of such
move. Later, the then Pak army Chief General Parvez Musharraf took over as its President.
International Court of Justice stayed the execution of Kulbhushan Jadhav, who was sentenced to death by a Pakistan
military court on the charge of spying. The Court said that India should have been granted consular access to
Kulbhushan Jadhav as per the Vienna Convention.
India accused Pakistan of violating the Vienna Convention and conducting a “farcical trial” for convicting Jadhav
without a “shred of evidence.

Sir Creek Dispute


 Sir Creek is a 96 km tidal estuary on the border of India and Pakistan which opens up into the Arabian Sea, &
divides Gujarat state of India from Sindh province of Pakistan.
 Pakistan claims the entire Sir Creek, with its eastern bank defined by a “green line” and represented on a 1914 map belongs to it.
Accepting Pakistan’s premise on the “green line” would mean loss of about 250 square miles of EEZ for India.

 India supports its stance by citing the Thalweg doctrine in international law. The law states that river boundaries between two states may
be, if the two states agree, divided by the mid-channel, also shown on a map dated 1925.

 Though Pakistan does not dispute the 1925 map, it 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.
Sir Creek itself has little value. It is a marshy wasteland. But where the boundary line runs through it will determine
how much Exclusive Economic Zone (EEZ) one country will lose or gain. Much of the region is rich in oil and gas
below the sea bed, and control over the creek would have a huge bearing on the energy potential of each nation.

Challenges due to non- resolution of Sir Creek Issue


 Due to lack of proper maritime boundary, inadvertent crossing over of fishermen of both nations
 Main route to smuggle drugs, arms and petroleum product to India – exploited by drug syndicate
 Terrorists are using disputed area to cross over Indian side. In 26/11 terror attack, terrorists captured an Indian
fishing vessel, Kuber, off Sir Creek, and used it to attack Mumbai.
Way Forward – Designating the non-delineated area-Sir Creek and its approaches-as a zone of disengagement or a jointly administered
maritime park

Siachen Dispute
Siachen is a triangular bit of land between Pakistan occupied Kashmir and the part ceded by Pakistan to the Chinese,
which has the dubious distinction of being the world’s highest battlefield.
 The Siachen dispute is a direct result of the ambiguity that exists in the Karachi ceasefire agreement of July 1949.
The agreement, which established the ceasefire line, the positions of the two militaries at the end of the 1947-1948
war, did not delineate beyond grid reference NJ 9842, which falls south of the Siachen glacier, to the Chinese
border but left it as “Chalunka (on the Shyok River), Khor, thence North to the glaciers”.
 Indian and Pakistani sides have since interpreted the phrase “thence North to the glaciers” very differently.
 Pakistan argues that this means that the line should go from NJ 9842 straight to the Karakoram pass on the Sino-Indian border.
 India, however, insists that the line should proceed north from NJ 9842 along the Saltoro range to the border with China.

 Siachen sits at a very strategic location with Pakistan on the left and China on the right. So Pakistan re-interpreted it
as North-Eastwards to claim the area beyond the Saltoro Ridge and beyond Siachen as its own.
 This would give Pakistan direct connectivity to China as well as a strategic oversight over the Ladakh region and
on to the crucial Leh-Srinagar highway posing a serious threat to India.
 In 1983, Pakistani generals decided to stake their claim through troop deployments to the Siachen glacier. To pre-
empt Pakistan, India launched Operation Meghdoot in April 1984 and occupied the high points of the glacier.
Cost of military deployment in such inhospitable territory
 According to reliable estimates, over 2,000 soldiers from both sides have died on the Siachen glacier since 1984,
when India beat Pakistan by a few days to occupy many of the strategic locations on the glacier.
 It is not just avalanches; the challenging terrain of the glacier and its surroundings as a whole have been regularly
claiming lives.
 Ever since the two militaries began a costly engagement on the glacier, there have been numerous efforts by both
countries to find a way to demilitarise the glacier, but a result has yet to be seen in actual.

Indus Waters Treaty


The Indus Waters Treaty,
brokered by World Bank, was
signed by the then-Indian
Prime Minister Jawaharlal
Nehru and Pakistani President
Ayub Khan in 1960.
 It administers how Indus
River and its tributaries
would be utilized.
 India governs Beas, Ravi,
and Sutlej; Pakistan governs
Indus, Chenab, and Jhelum.
 However, India is allowed
to use 20% of Indus water
for irrigation, power-
generation, and
transportation.
 Exchange of information about the rivers through Permanent Indus Commission – comprising of representatives
from bothIndia and Pakistan
 Disputes have to be referred to seven member arbitral tribunal called “Court of Arbitration”.

Drawbacks of Indus Water Treaty


 Division of water during the shortage of river water flow
 The impact of storage of water on the Chenab river on Pakistan
 Treaty is criticised being highly technical which leads to far ranging interpretations
 The political situation between India and Pakistan is affecting the performance of treaty.

Way forward
 To resolve the water dispute political will from both the countries is important.
 The Technical aspects of the treaty should be answered through bilateral meetings and discussion involving experts
from both the countries.
 The global warming and climate change is melting the glaciers Tibetan Plateau which will impact Indus river water
system in future. Therefore both the countries should aim to reduce water wastage and develop sustainable river
development plans.

Kulbhusan Jhadav Case


Kulbushan Jadhav was allegedly arrested in the Chaman area of Balochistan on the Pakistan- Afghanistan border.
India denied that he had any links to its government but said that he was running a business in the Iranian port city of
Chabahar after a “premature retirement” from the Navy.
India believed that Kulbhushan Jadhav was kidnapped from Iran and his subsequent presence in Pakistan has never
been explained credibly. Kulbhushan Jadhav was sentenced to death in a Field General Court Martial after he was
found guilty on charges of espionage.
India had dragged Pakistan to the International Court of Justice (ICJ) for refusing consular access to Jadhav and for
violating the Vienna Convention on consular relations. India accused Pakistan of violating the Vienna Convention and
conducting a “farcical trial” for convicting Jadhav without a “shred of evidence”.
India’s argument at ICJ
 Kulbhushan Jadhav has not got the right to get proper legal assistance and the right to consular access.
 The execution of the death sentence cannot be done while this court is hearing the appeal. Else, it will be a violation
of the Vienna Convention.
 Jadhav was kidnapped from Iran where he was involved in business activities after retiring from the Indian Navy.

Pakistan’s argument at the ICJ


 There is no “urgency” in this case as the date on which Jadhav will be executed has not yet been fixed;
 Pakistan argued that Vienna Convention provisions not intended to apply to a ‘spy’ involved in terror activities.

India has achieved its immediate objective in approaching the ICJ i.e. to ensure that Mr. Jadhav is not executed
pending adjudication of the matter. As an immediate consequence, Pakistan is now under an obligation to grant
consular access to Mr. Jadhav. However, this is a preliminary ruling and all issues are open for adjudication at the
final stage.

CHABAHAR PORT

Why in news?

India sent its first consignment of wheat to Afghanistan through the Chabahar port in Iran. More about the Route *
The sea route connects Gujarat’s Kandla port to Chabahar from where the shipment will be taken to Afghanistan
through a land route.
Importance of Chabahar Port *
Bypassing Pakistan’s resistance- India has
strategically circumvented
Pakistan which has opened up new
opportunities for trade and transit from and
to Afghanistan and enhance trade and
commerce between the three countries. *
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. * 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’. * 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. * Important for the stability of the
region- In the long term, the project is expected to improve
the economic conditions of the region with the introduction
of newer opportunities.
About RCEP * The RCEP is billed as an FTA between the 10-member ASEAN bloc and its six FTA partners —
India, China, Japan, South Korea, Australia and New Zealand. * When inked, it would become the world’s
biggest free trade pact. This is because the 16 nations account for a total GDP (Purchasing Power Parity, or
PPP basis) of about $50 trillion (or about 40% of the global GDP) and house close to 3.5 billion people (about
half the world’s population). * The RCEP ‘guiding principles and objectives’ state that the “negotiations on
trade in goods, trade in services, investment and other areas will be conducted in parallel to ensure a
comprehensive and balanced outcome.” * The proposed FTA, aims to boost goods trade by eliminating most
tariff and non-tariff barriers — a move that is expected to provide the region’s consumers greater choice of
quality products at affordable rates. It also seeks
to liberalise investment norms and do away with
services trade restrictions. * The TAPI project is
crucial to India, as its success would spur
other connectivity such as road and rail
between Central Asia and India, and
potentially change economic relations.
Diplomatic relations too could undergo a sea
change, bringing Central Asia out of the
Russian-Chinese orbit. * The TAPI pipeline
gives this fractured region a reason to work
on a project together as well, and it is hoped
the shared stakes in TAPI’s success will ensure
that India, Pakistan and Afghanistan find ways
of cooperating on other issues as well.
Challenges before the project * The project
faces the challenge of terrorism. Unless the
pipeline is secured from the Taliban that operates on both sides of the Durand Line, and from
militant groups operating in Pakistan, it is hard to see how the TAPI dream can go beyond the
groundbreaking ceremony. * The success of TAPI project is also dependent on the overall relation
not only between India and Pakistan but also between Pakistan and Afghanistan. Way forward The
project will be actualised if the leadership of all four member-countries don’t just dwell on the world
that exists today, but the region as it can be: connected, cooperative, peaceful and prosperous.

India China Relations


India & China, both the countries started off on cordial note post independence with signing of Panchsheel. However
the relations turned cold post 1962 war which created mistrust between the two countries since then. Both the
countries have similar attributes and problems including large population, huge rural-urban divide, rising economy
and conflict with neighbours.

Major irritants
 Border Disputes – Share about 3,488-km long border which is yet to be fully delineated.
 India supports a Tibetan gov. in exile formed by Dalai Lama, unacceptable to china. China recently opposed to the
Dalai Lama’s visit to Arunachal Pradesh, particularly Tawang, which it considers as Southern Tibet.
 China began the practice of issuing stapled visa to residents of AP and J & K, though it stopped it for J & K but
continues for AP.
 China has an undeclared policy of String of Pearls to encircle India, which involves building of ports and naval
bases around India’s maritime reaches. While India has been trying to develop closer arrangements with the
countries surrounding China viz. Japan, South Korea & Vietnam
 China has been building dams in Tibet part of Brahmaputra. India has objected to it but there has been no formal
treaty over sharing of the Brahmaputra water.
 China has been blocking India’s attempt to entry to NSG & has also blocked India’s attempt at the UN for sanctions
against Jash-e-Mohammad chief Masood Azhar.
 India considers building of the CPEC as China’s interference in India’s sovereignty and territorial integrity.
 Trade imbalance with the imbalance skewed in China’s favour viz. $46.56 billion in 2016

Border Dispute India China


Western Border Dispute – Johnson’s line shows Aksai Chin to be under Indian control whereas the McDonald Line
places it under Chinese control. Line of Actual Control separates Indian-administered areas of J & K from Aksai Chin
& is concurrent with the Chinese Aksai Chin claim line. China and India went to war in 1962 over disputed territory
of Aksai Chin. India claimed this was a part of Kashmir, while China claimed it was a part of Xinjiang.
Eastern Border Dispute: China considers the McMahon Line illegal and unacceptable claiming that Tibet had no
right to sign the 1914 Convention held in Shimla which delineated the Mc Mahon line on the map – Thus claims parts
of Arunachal Pradesh – India and China have held 19 rounds of Special Representative Talks on the border and there
has yet to be an exchange of maps.

China Pak Axis


 Higher than the mountains, deeper than the oceans, sweeter than honey
 China is Pakistan’s great economic hope and its most trusted military partner
 Pakistan lies at the heart of China’s geostrategic ambitions i.e. New silk road connecting the energy fields of the
Middle East and the markets of Europe to China
 China opposed India’s admission into permanent seat of UNSC, & insisted for Pakistan
 CPEC – will connect Kashgar in China’s Xinjiang province with the port of Gwadar
 Military and nuclear arms support by China in the past besides economic support
 China‘s has been shielding Pakistan’s terrorist outfit chief, Massod Azhar from being listed as a ‘Global Terrorist’
by the UN.

OBOR – Will Connect Asia, Africa, Middle East & Europe


 Three main goals of China are:
 Economic diversification

 Political stability and the

 Development of a multipolar global order


 All of India’s neighbours, except Bhutan, sent highlevel delegations for the summit.
India’s Objection to OBOR
 Projects in the Gilgit-Baltistan region, ignoring India’s “sovereignty and territorial integrity”.
 Lack of transparency in China’s agenda, New Delhi believes that it is not just an economic project but one that
China is promoting for political control
 Smacks of Chinese neo-colonialism – Could push smaller countries on the road into a crushing debt cycle, destroy
the ecology and disrupt local communities.
 India fears that CPEC, passing through the Pakistan controlled Kashmir, would serve the purpose of granting
legitimacy to Pakistan’s control over the region, and by promoting the construction of the corridor, China intends to
meddle in the Kashmir dispute.
 Indian security experts also fear that after gaining access to Gwadar port, the Chinese will find it easy to sail into
the Indian Ocean.

India’s decision to skip the meeting came after a year of bilateral discord over China’s stubborn opposition to India’s
entry into the NSG and a UN ban against Pakistan-based terrorist group Jaish-e-Muhammad leader Masood Azhar.
The decision to not attend even as an observer, however, effectively closes the door for diplomacy. Expert believe that
by boycotting the Beijing meet, India was denying itself unending benefits of something as big as OBOR for ex.
infrastructural shortcoming that it is facing currently. Meanwhile India & Japan have come up with Asia Africa
Growth Corridor to counter China’s OBOR.
The Baloch Angle
Gwadar is located in Baluchistan, & Baloch are against CPEC because they claim that the CPEC’s benefits will not
flow to them. They further state that CPEC is not an economic project. Pakistan and China together are building a
military infrastructure in Balochistan’s coastal areas. The purpose is to strengthen their military supremacy in the
region which will undermine the stability of the region. A fear of a massive inflow of migrants from different areas of
Pakistan which will change the demography of Balochistan and reduce the Baloch people to a permanent minority in
their historic homeland.

South China Sea Dispute


New islands were constructed by dredging sand onto reefs, an effort by China to boost its claim to all of the Spratly
Islands in the South China Sea. It has also built ports, Runaways and radar facilities on the manmade islands. satellite
images of the islands, show that China now appears to have installed large antiaircraft guns and weapons systems as
well – Paracel and Spratly islands

 China rejected an international ruling on the South China Sea as “null and void” and devoid of any “binding force”.
 China’s development in the region is seen as threatening to other nations Taiwan, Brunei, Philippines and Malaysia.
 About half of the world’s annual merchant fleet tonnage—passed through the South China Sea in 2010. Any
tension in the region may immensely affect the international trade and economy
 China has demonstrated a desire to control all of the passage through what it considers its sphere of naval power.
This predilection is in direct opposition to the U.S.-backed global standard of free passage through the high seas.

India has made it clear that it recognised that the tribunal had been set up within the jurisdiction of the UN’s
Convention on the Law of the Sea (UNCLOS) that must be given the “utmost respect”. As part of a soft-diplomacy
effort, India is looking to have South China Sea countries such as Vietnam, Malaysia and Philippines use the tsunami
early warning-system developed by India.

Doklam Plateau Face-off


Indian troops intervened to block the path of Chinese People’s Liberation Army soldiers engaged in building road-
works on the Doklam plateau, a strategically vital 269 sq. km. patch of Bhutan’s territory that Beijing laid claim to.
 This is the first time that India used troops to protect Bhutan’s territorial interests.
 Earlier China have made Bhutan a “package deal” under which the Chinese agreed to renounce their claim over the
495-sq.-km disputed land in the Northern Bhutan, in exchange for disputed land of Doklam plateau.

India’s concern
 The construction of a new road through the Chumbi valley would further endanger the “Chicken’s Neck” – the
narrow Siliguri corridor links the north-east with the rest of India
 India has conveyed to the Chinese government that the latter’s construction of road in the disputed Doklam area
‘would represent a significant change of status quo with serious security implications for India.’
 India is vulnerable in this corridor as it is the only access point to the northeast. The Corridor is about 500 km from
the Chumbi Valley.

Chinese reaction
 Following the tensions, Chinese authorities have closed the Nathu La pass to Kailash Mansarovar pilgrims.
 China served notice on India to withdraw its forces, as a precondition for a “meaningful dialogue” – unacceptable
to India, unless the PLA also withdraws its troops and road-building teams.
 China has long desired an independent Bhutanese stand without Indian advocacy and interference on the boundary
issue. Chinese academia often dubbed India’s interference as hegemony in South Asia.
 By challenging Bhutanese security, Beijing hoped to put a strain on the India-Bhutan “special relationship”.

India & China Mutually Disengaged Their Troops


 The end of Dokalam standoff is a huge political, diplomatic & moral victory for India. It will contribute to raising
the stature of the country. The fact that the Indian government stayed steadfast and resolute in the face of extreme
provocation, speaks volumes of the determined and decisive approach of the present government.
 The episode has significantly established the image of India as a responsible, decisive and reliable actor on the global scene.

 The episode has contributed to further strengthen relations between India and Bhutan. The message to India’s neighbourhood is also
positive and reassuring.
 However India and China should not see Doklam in terms of point-scoring but rather as a warning of the need for
extending their border management framework across other borders as well.
 Stronger economic and commercial partnership between the two countries can be a win -win scenario for both the
countries if China removes its non-tariff barriers against Indian products and services.
 India must necessarily “hope for the best, and prepare for the worst”, when it comes to tensions with its northern
neighbour.

Deterioration of India-China relation


 Delhi has expressed disappointment over China’s rejection of its concerns on sovereignty issues, and refusal to
corner Pakistan on cross-border terrorism or help India’s bid for NSG membership.
 In turn, India’s spurning of the OBOR Initiative and cooperation with U.S. on maritime issues has not played well
in China
 Dalai Lama visit to Tawang was strongly protested by China – it accused India for fuelling secessionist in Tibet.
 India is also working with Japan, South Korea and the US to contain China’s power in the Indian Ocean provoking
China

Cooperation between India and China


 Both members of BRICS, which is now establishing a formal lending arm, the New Development Bank.
 India, a founding member of the China-backed Asian Infrastructure Investment Bank.
 China welcomed India’s full membership of Shanghai Cooperation Organization.
 Both countries have advocated democratization of international institutions such as World Bank, IMF
 China and India have similar stand during WTO negotiations.
 China and India, being the main targets of criticism by the US and its friends, have so far successfully coordinated
their strategies in the environmental summits
Way forward for India
 Necessary to build up economic and security capabilities and begin to close the power gap with China.
 India’s foreign policy formulations on China and Pakistan need no longer be considered as separate instead one
hyphenated strategic entity.
 Time for India to join hands with Japan, US and EU to promote alternatives to Chinese economic exploitation.
 India should aggressively pursue ‘Cotton Route’, Project Mausam and Spice Route to strengthen economic ties
between countries in the Indian Ocean rim.
 Bring into action planned strategic Asia Africa Growth Corridor with the help of Japan.

Most of its neighbours have been adept at playing the “China card” against India’s alleged “hegemony”, and China
has been quick to exploit this to its advantage. Its strategy has been to bottle up India in the subcontinent, but India
can defeat this strategy of China by mending fences with the neighbours and by convincing them that it has no
hegemonic ambition.

India Japan Relations


Motivated primarily by shared concerns about China – developing a closer defence partnership defined by regular
maritime exercises and highlevel political consultations

Complementarities between the two countries


 Japan’s ageing population and India’s youthful dynamism
 India’s rich natural and human resources and Japan’s advanced technology
 India’s prowess in services and Japan’s excellence in manufacturing
 Japan’s surplus capital for investments and India’s large and growing markets & middle class

Cooperation from Japan


 Japan has been extending bilateral loan and grant assistance to India since 1958. Japan is the largest bilateral donor
to India in priority areas like power, transportation, environmental projects & Infra development –
 New Delhi metro network.

 Western Dedicated Freight Corridor

 Delhi-Mumbai Industrial Corridor

 Chennai-Bengaluru Industrial Corridor


 Agreement for Cooperation in the Peaceful Uses of Nuclear Energy
 To build upon cooperation in the field of smart cities
 Modernisation and expansion of conventional railway system in India
 Consolidation of security and defence cooperation
 MOU between JAXA and ISRO concerning Cooperation in the Field of Outer Space
 A dedicated task force having representatives of both countries for phased transfer of technology for success of
Make in India

India Japan Civil Nuclear Deal, 2016


 Enables Japan to export nuclear power plant technology as well as provide finance for nuclear power plants in India
 Now Companies involved in nuclear reactor programme of India can source the most critical equipment in a reactor
— Steel reactor vessel from Japan
 A major achievement for India as it is Japan’s first civilian nuclear cooperation pact with a country that has not
signed the nuclear NPT
 The agreement confirms India’s position in front of the world as a responsible nuclear nation which uses nuclear
energy peacefully
 Will boost India’s strategy to pursue a low-carbon growth model in decades to come

Asia Africa Growth Corridor


 Indian and Japanese governments unveiled a vision document for the Asia Africa Growth Corridor.
 It is an attempt 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.

 Japan’s contribution to the project will be its state-of-the-art technology and ability to build quality infrastructure,
while India will bring in its expertise of working in Africa.
 Unlike China’s OBOR project Asia Africa Growth Corridor is conceived as a more open and inclusive programme
that will be based on more consultations and keep people as the centre piece rather than just trade and economic
ties.
India’s Concerns With Russia
Once “special and privileged strategic partnership” – present tilt towards China which has border disputes with India
& close ties with Pakistan. Russia is also growing relations with Pakistan as it held its its first ever military exercises
with Pakistan
 Divergences between New Delhi and Moscow on terrorism emanating from Pakistan and Afghanistan
 Russia did not back India’s demand to name two Pakistan-based terror groups as perpetrators of terrorism against
India last year at the Goa BRICS summit
 Russia favouring a role for the rebel Taliban in a future Afghanistan
On the other hand, Russia has been concerned at the rapidly warming ties between India and the US including the recent signing of a
military logistics agreement.

Importance of India for Russia


 A market for its goods to bypass Western sanctions imposed after its power push in Ukraine.
 India is a natural partner for Russia & have been tried & tested in tough situation like Ukraine Crisis
 India still remains the biggest importer of defence equipment from Russia
 India is still a vast market for Russian energy resources & hydrocarbons
 Despite its renewed friendship with China, Russia will soon find itself in competition with it as Beijing regards
itself as the new G2 along with the US. India can help provide the multi-polarity that Russia fiercely seeks

Importance of Russia for India


 It can meet its abundant energy requirements at a cost-effective price
 India still needs to collaborate with Russia to master future technology in defence & space
 India needs support of Russia to pursue nanotechnology on grand scale; an expertise of Russia worldwide
 It improves India’s bargaining power when it negotiates arms sales with the West
 Geopolitically, Russia continues to be a balancing force against China & Pakistan in our region.
 Russia can be a major market for Indian industry such as pharmaceuticals, manufactured goods, dairy products,
bovine meat and frozen seafood
 Joint projects on exploration and exploitation of hydrocarbons in the Arctic shelf of Russia
 Support for India’s bid for permanent membership in UNSCl and NSG

Russia- Pakistan Relations


Pakistan after independence joined western military block by signing SEATO & CENTO, thus making Pakistan and
Russia Cold War rivals. However, only recently in 2014 Russia lifted its self-imposed arms embargo on Pakistan and
signed a landmark military cooperation agreement.
 Both the countries share a common threat i.e. Islamic State of Iraq and Levant
 Increased coordination on combating Narcotic Trade
 Handing over of Chechen Terrorist by Pakistan to Russia
 Pakistan has offered Russia to use the new Gwadar port.
 Russia which currently faces several sanctions after its aggression in Ukraine, is set to find new market for its
defence equipment in Pakistan
 Russia understands Pakistan’s crucial role in establishing resolving civil war in Afghanistan through dialogue with
Taliban

Russia’s change in stance is evident of its re-energised role in Afghanistan. It can be seen as a positive step towards
establishing peace in the neighbourhood. However, India should explore other sector of cooperation with Russia such
as pharmaceuticals, agriculture, food processing etc. to improve its trade prospects. The General Framework
Agreement for Kundankulam is still pending, India should move fast to safeguard its energy needs. Changing Geo-
Political situation across Asia makes it important for India to balance its ties between US and Russia well, to maintain
its leadership role in South-Asia.

India Bhutan Relations


Bhutan- India relations are governed by a friendship treaty (1949) that was renegotiated in 2007, freeing Thimphu’s
external relations & arms import permission from Delhi, but still subjecting the Himalayan nation’s security needs to
supervision.
Under the 2007 India-Bhutan Friendship Treaty, the two sides have agreed to “cooperate closely with each other on
issues relating to their national interests” + Neither Government shall allow the use of its territory for activities
harmful to the national security and interest of the other
 India is Bhutan’s largest trading partner -Bhutan sources the majority of its import requirements from India.
 One-third of Bhutan’s exports to India is electricity, highly valuable for India
 Free trade regime between the two countries
 India has been providing financial assistance to Bhutan’s five-year development plans since 1961
 Hydro-electric power generated by Bhutan’s river dams is economic bedrock of the India-Bhutan relationship.

 India has helped finance the dams through a combination of aid & loans and buys the excess electricity at very low prices.

Importance of Bhutan
 Buffer state between India and china
 Strategic Importance – Chumbi Valley is situated at the trijunction of Bhutan, India and China and is 500 km away
from the “Chicken’s neck” in North Bengal, which connects the northeast with rest of the country.
 Bhutan in past has helped India to contain insurgency in North-East by flushing out militants groups like NDFB &
ULFA.
 Only country in the region that joined India in its boycott of Chinese President OBOR project
 China is interested in establishing formal ties with Thimphu, where it does not yet have a diplomatic mission.
Bhutan is strategically important for both India and China.

BBIN Initiative
Bangladesh, Bhutan, India and Nepal (BBIN) motor vehicle agreement, for streamline movement of passenger and
cargo transport, was rejected by the upper house of the Bhutanese Parliament.

Reasons Given
 Streamline movement of passenger & cargo transport will overwhelm Bhutan with traffic, tourists & pollution.
 BBIN MVA is not much of help to Bhutan in economic development as Bhutan’s trade is mostly with India & both
nations already allow free movement of vehicles across their border.

Significance of BBIN for India


 Significance for its neighbourhood diplomacy.
 Would have paved the way for a seamless movement of people and goods across their borders for the benefit and
integration of the region and its economic development.
 India’s plan to single out Pakistan by implementing the pact has suffered a jolt by Bhutan rejection.

India has asked the Bhutanese government to reconsider the pact. However, the reconsideration can be done only after
a year, as per the procedure there.For the time being, it has been decided that the pact will be implemented only
amongst those countries which have ratified it- India, Bangladesh and Nepal.

India Nepal Relations


The relationship between the two countries is bound by history, geography, economic cooperation, socio-cultural ties
and people-to-people relations. As close neighbours, India and Nepal share a unique relationship of friendship and
cooperation characterized by open borders and deep-rooted people-to-people contacts of kinship and culture.

Significance of Nepal for India


 Nepal is a buffer state between India and China
 Nepal shares a long open border with India. There is alleged link between Naxalites and Maoist in Nepal.
 Socio-economic development of bordering states especially Bihar and Uttar Pradesh
 To check the growing influence of china in Nepal. Chinese are planning to construct road and rail link as part of
silk route project.
 Nearly 30 lakh Nepalis (some 10 % of Nepal’s population) are employed in India; this includes some 50,000-
60,000 soldiers.

Major Irritants
 Nepal has accused that India is interfering in its internal political matters
 India is worried about Nepal growing close relation with China
 OBOR has a blueprint of connecting Nepal with the Eurasian transport corridor.
 Nepal had signed Transit agreement with China mainly aimed at reducing Nepal’s overwhelming economic
dependence on India.
 There is a set pattern of the Kathmandu regime using the China card whenever it runs into difficulties with its own
people and India lends support to the Nepali people’s cause.

Nepal-India tensions spiked last year with the promulgation of a constitution that was perceived as non-inclusive of
ethnic Madhesi and Tharu groups. For almost six months there was blocked in India-Nepal border. 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; particularly those related to transit through China
and rail and road connectivity between Nepal and China.
India refuted those allegations, stressing that the border tensions were caused by the Madhesi parties and were the
outcome of internal protests in Nepal. India also accused Nepal of stoking ‘anti-India’ sentiment and has been irritated
about Nepal’s attempt to use the ‘China card’.
Nepal is a challenge for Indian government not only for the China factor but also for how to deal with its ethnic
question- the controversy between the Nepali & Madhesi (Indian origin Nepalese of the Terai region) identities.
India Bangladesh Relations
India’s links with Bangladesh are civilizational, cultural, social and economic – a shared history and common
heritage, linguistic and cultural ties, passion for music, literature and the arts.

Importance of Bangladesh for India


 Bangladesh’s location is a strategic wedge between mainland India and NE seven states. Each of these states is
land-locked and has shorter route to the sea through Bangladesh. Transit agreement with Bangladesh will spur the
socio-economic development of North-East India.
 Bangladesh is a natural pillar of ActEast policy. It can act as a ‘bridge’ to economic and political linkages with
South East Asia and beyond.
 To contain insurgency in North-East – Ensuring that no anti-India terror or insurgent activities can be carried out
from its soil.
 A ‘neutral’ Bangladesh also ensures containment of an assertive China in this region.

Major Irritants with Bangladesh


 Illegal migration since the 1971 war of independence of Bangladesh
 Border Management: The Indo-Bangladesh border is notorious for smuggling, apart from trafficking in arms, drugs
and people
 Bangladesh uses China card to supplement its bargaining capacity against India.
 Water-sharing: India- Bangladesh share 54 trans-boundary rivers – Major irritant is sharing water of river Teesta.

Water Sharing Disputes


Ganga River Dispute
 In 1996, the sharing of the Ganga waters was successfully agreed upon between the two nations.
 However, the major area of dispute has been India’s construction and operation of the Farakka Barrage to increase
water supply to the 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.

Barak River Contension


 Bangladesh has been demanding to stop the construction of the Tipaimukh Hydro-Electric Power Project on the
Barak River on the eastern edge of Bangladesh.
 Bangladesh says that the massive dam will disrupt the seasonal rhythm of the river and have an adverse effect on
downstream agriculture, fisheries and ecology of the region.

Teesta River Dispute


 Teesta river is a major source of irrigation to the paddy growing greater Rangpur region of Bangladesh.
 Bangladesh has sought an equitable distribution of Teesta waters, on the lines of Ganga Water Treaty of 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.
Teesta River Agreement Importance
 The deal will help New Delhi get more political leverage, which, it thinks, is necessary to check the rising influence
of an extra regional power – China – in the Bay of Bengal region.
 India’s perceived refusal to give Bangladesh its share of the river waters has fuelled a lot of anti-India sentiments in
Bangladesh. India is being accused of being a regional bully.
 For Sheikh Hasina, the deal will support her chances to retain power in the 2018 general elections in Bangladesh –
Pro India

On the Teesta River, Indian PM reiterated government’s strong resolve to conclude the water sharing treaty. However,
the central government is not willing to go ahead with the agreement without taking West Bengal CM on board.

Recent Development in Relations


 Land Boundary Agreement – Exchange of certain enclave territories with Bangladesh and conferment of
citizenship rights to residents of enclaves’ 100th Amendment Act paves the way for the operationalization of the
1974 India-Bangladesh Land Boundary agreement. Under the Agreement (LBA), 111 border enclaves will be
transferred to Bangladesh in exchange for 51 that will become part of India.
 Power agreement and internet service – India will supply 100 megawatt (MW) of electricity in return for 10
Gigabits per second Internet bandwidth to North East.
 Sundarban Moitry - A joint exercise between Border Security Force (BSF) and Border Guard Bangladesh (BGB).
 Border Haats on India-Bangladesh Border
 ICT enabled Integrated Check Post to enable greater economic integration and significantly improve the
connectivity between India and Bangladesh
India Sri Lanka Relations
India is Sri Lanka’s closest neighbour that has ethnic links to its most significant minority. India has a huge influence
in the island nation’s political, economic, social and cultural consciousness, and its world view.

Major Irritants
 Fishermen Issue – Both countries are separated by the International Maritime Boundary Line. Often, fishermen
from both sides cross over to other side for fishing expeditions – results in arrests &, sometimes, shootings.
 Sri Lanka accuses Indian fishermen of straying into its territorial waters, while the latter maintain they are only
fishing in their traditional areas, especially around Katchatheevu, an islet ceded to Colombo in 1974.
 Katchatheevu Island – One of the major reasons complicating the issue is of Katchatheevu Island which India
ceded to Sri Lanka in 1974 under a conditional accord. In 2009, the Sri Lankan government declared Katchatheevu
Island as sacred land owing to a Catholic shrine’s presence on the piece of land.
 India stands for a “united Sri Lanka”, but wants an “early and full implementation of the 13th Amendment” that
provides for devolution in the Tamil majority Northern and Eastern provinces.
 Sri Lanka is part of China’s Maritime Silk Road. China is also modernizing Hambantota port in Sri Lanka
 Sri Lanka has decided to clear the stalled $1.4 billion Colombo Port City, which had China as a partner
For Fisherman issue Indian Navy or Coast Guard should join the Sri Lankan Navy in jointly patrolling the international boundary to prevent
trespassing.
Cooperation Fields
 India is Sri Lanka’s largest trading partner globally
 India-Sri Lanka Free Trade Agreement of 1998 was followed by efforts towards a Comprehensive Economic
Partnership Agreement (CEPA) to liberalise trade in services and investment starting in the mid-2000s
 India to assist Sri Lanka in the enhanced usage of Natural Gas
 joint investments in the development of Port, Petroleum Refinery and other industries in Trincomalee.
 India and Sri Lanka signed a civil nuclear cooperation agreement, the first such deal signed by Sri Lanka with any
foreign country, reflecting the new Lankan government’s pro-India approach.
 To encourage Indian companies to invest in a Container Terminal in Colombo Port, considering that majority of
transhipment in Colombo Port is related to India
 Sampoor project: 500-MW Sampoor thermal power project, a joint venture involving Sri Lanka and India, was
granted environmental clearance.
While New Delhi’s anxiety over Chinese presence might be justified, it should avoid using China lens to view Sri
Lanka, respecting the country’s autonomy to engage with any willing partner. The more India treats Sri Lanka as an
equal partner, the stronger the relationship is likely to grow.

India Afghanistan Relations


India & Afghanistan have a strong relationship based on historical & cultural links. Since time immemorial, people of
Afghanistan and India have interacted with each other through trade and commerce, peacefully coexisting on the basis
of their shared cultural values and commonalities.
 In 1999, India became one of the key supporters of the anti-Taliban Northern Alliance.
 In 2005, India proposed Afghanistan’s membership in the SAARC.
 Recently, Prime Minister Narendra Modi was conferred with Afghanistan’s highest civilian honour, the Amir
Amanullah Khan Award.
 India has been favouring an Afghan led and Afghan-owned peace process.

India’s Contribution
 India is the sixth largest donor to Afghanistan in diverse development projects – education, agriculture, infra
 India has contributed close to $ 2 billion untied funds in infrastructure development in Afghanistan

 Zaranj to Delaram road project for facilitating movement of goods and services to the Iranian border
 220kV DC transmission line from Pul-e-Khumri to Kabul
 Construction of Afghan-India Friendship Dam (Salma Dam) in Herat province
 Construction of Afghan Parliament
Strategic Significance of Afghanistan
 Afghanistan is gateway to energy rich central Asia & situated at crossroads between South Asia & Middle East
 Afghanistan has significant oil and gas reserves and has rich source of rare earth materials
 Stable government in Kabul is essential to reduce terror activities across south Asia & in J & K
 India was the first country Afghanistan chose to sign a strategic partnership agreement with, despite the U.S. and
Pakistan keen on doing so
 India donated three Mi-25 attack helicopters to Afghanistan as part of the bilateral strategic partnership to counter
the Taliban
 The massive reconstruction plans for the country offer a lot of opportunities for Indian companies.
 It has also signed the TAPI pipeline project that aims to bring natural gas from Turkmenistan through Afghanistan
and Pakistan to India
 In the absence of transit route through Pakistan, India depends on other countries, including Iran, to send goods to Afghanistan even
though it increases time and costs for Indian exporters.

 Hence, Recently India and Afghanistan inaugurated a dedicated air freight corridor service. It will provide Afghanistan, a landlocked
country, greater access to markets in India.

 India is also cooperating with Afghanistan and Iran for development of the Chahbahar Port which provides an alternative route to
Afghanistan and Central Asia.

 India hosted the 6th Ministerial Conference of Heart of Asia at which the Amritsar Declaration was adopted. It called for immediate
elimination of terrorism to help Afghanistan in its political and economic transition.

Global Conference on Afghanistan in Russia


 To discuss ways of ending conflict in Afghanistan and establish durable peace
 Moscow invited Iran, Pakistan, India, China and five Central Asian States
 Russia’s pursuit of “great power” status + growing concern over terrorism and narcotic drugs pushed it to enter the
Afghan conflict
 Russia believes the Taliban is a “legitimate stakeholder” in the conflict that must be engaged,& and is “lesser evil”
than Islamic State/Da’esh forces in Afghanistan; & established links with the Taliban to coordinate efforts against
Daesh in Afghanistan.
 By supporting the Taliban, Russia intends to strengthen barriers to US interests in the region. Moreover Russia also reminds the West not
to ignore Moscow’s interests in discussions of the Afghanistan agenda at regional & international platforms.

 Chinese interest in Afghan reconciliation stems not only from a security/terrorism angle but also more significantly to ensure the
sustainability of OBOR given its importance in providing access to Central Asia.
 India supports an Afghan led and Afghan owned national reconciliation process within the framework of the
Afghan constitution.
 India took a hard line, opposing the dominant view from Russia, China and Pakistan to involve the Taliban in
reconciliation efforts.
 Russia’s support to the Taliban will have numerous implications for the future of Afghanistan. It will weaken the
central government in Kabul, which may result in the situation like Syria.
India Myanmar Relations
India and Myanmar have traditionally had much in common, with cultural, historical, ethnic and religious ties, in
addition to sharing a long geographical land border and maritime boundary in the Bay of Bengal.

Importance of Myanmar for India


 Cultural, historical, ethnic and religious ties
 To tackle insurgency in North-East – “a large number of cross-border ethnic groups and insurgents from Northeast
India have military bases in Myanmar
 For Economic development of North- East – Act east policy – Myanmar lies at tri-junction of east, southeast and
south Asia
 Strategically important to India as it is the only ASEAN country that shares a border with India
 India is eying Myanmar’s abundant oil and natural gas” reserves to meet her energy requirements
 Myanmar, a rapidly growing economy, offers significant opportunities for trade in goods and services, investment
and project exports.
 ASEAN + BIMSTEC +Mekong Ganga Cooperation – Forum they share together
 In addition to a land border, both countries also share a long maritime boundary in the strategically significant
Andaman Sea and Bay of Bengal where they face common challenges, which include not just a rising China but
illegal fishing and smuggling.
Kaladan Multi-Modal Transit Transport Project
The project will connect the seaport of Kolkata with Sittwe seaport in Myanmar by sea; it will then link Sittwe seaport
to Lashio in Myanmar via Kaladan river boat route & then from Lashio on to Mizoram in India by road transport.

 Will reduce distance from Kolkata to Mizoram by approximately 1000 km and cut travelling time to 3-4 days for
transport of goods.
 Necessary in case of any conflict with China as present route i.e. chicken neck could be blocked by China in
conflict situation.
 The access to the sea that the project provides its Northeastern states could boost their economies.
 It would strengthen India’s trade and transport links with Southeast Asia.
 It will be instrumental for “act-east policy”

India-Myanmar-Thailand trilateral highway


India’s renewed commitment to complete the 3,200-km India-Asean trilateral highway that extends from Moreh in
India to Mae Sot in Thailand via Mandalay, Myanmar

Concern
 Discontent over continuing delay in completion of flagship projects
 Kaladan and India-Myanmar-Thailand trilateral highway – Conceived over a decade back, they are scheduled to be
completed by 2019.
 In addition to a land border, both countries also share a long maritime boundary in the strategically significant
Andaman Sea and Bay of Bengal where they face common challenges, which include not just a rising China but
illegal fishing and smuggling.

Rohingya Muslims Issues


More than one million people in Myanmar identify as Rohingya, a predominantly Muslim group living mainly in
Rakhine State on the country’s western coast. These people lack documentation to satisfy the constitutional
requirement that their ancestors settled in the country before 1823.
 Since 2016 Myanmar’s army has carried out “clearance operations” in the north of the western state to root out
insurgents accused of deadly raids on police border posts.
 UN human rights office said that Myanmar’s security forces had committed mass killings and gang rapes of
Rohingya Muslims and burned their villages.

Impact
 Many Rohingya have fled to neighbouring Bangladesh, alleging rape, murder and torture at the hands of security
forces. A large number of those escaping the violence end up in the trafficking networks.
 The persecuted Rohingya Muslims are likely to provide fertile recruiting grounds for extremists.
 Bangladesh fears that Islamist hard-liners, who staunchly support the Rohingya Muslims, are trying to exploit the
situation for their political benefits.
 Some sections of the Rohingyas have formed armed guerilla groups in Rakhine to fight Myanmar’s Army and
operate along the mountainous border.
 Despite Myanmar’s transition towards democracy, the country’s government refuses to address the issue.

The Rohingya crisis is a political issue in Myanmar. The ultimate solution lies in the granting citizenship and ensuring
equal rights in their ancestral home. Until a permanent solution is found in Myanmar, it is the responsibility of refugee
hosting countries, including Bangladesh, to ensure that Rohingya people can live with basic human rights and dignity.
International community needs to play more proactive role in resolving present crisis. Due to lack of economic
interest in Myanmar, western world is not very enthusiastic to resolve the crisis and deals it as internal problem of
Myanmar.

India Central Asia Relations


Long historical, cultural and economic connections. The famous Silk Route not only connected the people and
businesses, but also let the thoughts, culture and beliefs flow freely from one region to the other.
 India considers the Central Asian countries as part of its ‘extended and strategic neighbourhood
 In 2012, India announced the ‘Connect Central Asia’ policy with four major interests in Central Asia: security,
energy, trade and mutual cooperation in various realms

Importance of central Asia


 Energy security – Significant hydrocarbon (gas) and mineral resources (uranium) + close to India geographically
 Strategic Location – Geographically a bridge between different regions of Asia and between Europe and Asia
 Complementary Economies – India wants energy reserves, they want agricultural & pharmaceutical products
 Security – To tackle the challenge of terrorism, narcotics trafficking and arms smuggling – as it lies in
neighborhood of ‘Golden Crescent’
 Central Asian nations and India can play effectively role in bringing normalcy in Afghanistan.
 Regional cooperation: Four central Asian Nations are part of SCO

Challenges
 The key constraint India faces is the lack of direct access to Central Asia
 Central Asian region is land locked. It has hampered India’s relation with central Asia. Poor connectivity has also
contributed to the below-par trade between India and Central Asia.
 The unstable situation in Afghanistan and a highly problematic India-Pakistan relation have deprived India from the
benefit of relations with Central Asia.
 Chinese presence: Central Asia is part of Silk Road Economic Belt initiative

Latest development to connect central Asia


 India has become full member of SCO. Annual SCO summits will provide a forum to leaders of these countries to
meet and discuss issues of bilateral and regional interest.
 India is a founding member of International North-South Transport Corridor, a multi-nation project to create
transport and logistics infrastructure
 India plans to develop Chabahar port in Iran, which will allow access to landlocked Afghanistan and energy-rich
Central Asia from Indian Ports
 India has acceded to Ashgabat Agreement, an international transport and transit corridor facilitating transportation
of
 Goods between Central Asia and the Persian Gulf.
 Turkmenistan-Afghanistan-Pakistan-India (TAPI), expected to be completed by end 2019

India – Kazakhstan
 The biggest source of Uranium for India, besides Australia and Canada
 India was one of the first countries to recognize the independence of Kazakhstan.
 Have agreement on defence and military-technical cooperation
 Kazakhstan is India’s largest trading partner in Central Asia
 Kazakhstan is the biggest oil and gas producer in Central Asia
 Kazakhstan is supportive of India’s permanent membership of UNSC and full membership of SCO and India
supported Kazakhstan’s candidature for non-permanent membership of UNSC for 2017-18.
India Africa Relations
South–South cooperation, people-to-people linkages and common development challenges + India’s consistent
support to anti-colonial & antiracist liberation, & apartheid struggles in South Africa.

Importance of Africa (1 billion population market)


 Africa is resource-rich – moving from being an underdeveloped continent to having fast-growing economies
 India’s ambition to become a permanent member of UNSC needs support from all 54 countries of the continent.
 Africa has emerged as an important market for Indian goods, agribusiness, pharmaceuticals and services; & in
return proves to be a vital element in India’s quest for strategic minerals and other natural resources
 Africa is crucial to the India-fostered International Solar Alliance. Over a dozen of the ISA’s members are from
Africa, the continental powerhouse of solar energy.

Convergence of Interest
 Aligned on the outstanding issues at the WTO and are in favour of multilateral trading systems.
 Cooperation on climate change as both had “contributed the least to global warming”.
 Convergence of interest for reforming the Security Council
 India provides a useful model for democratic development & is increasingly responding to requests from African
governments to share its democratic experience
 Indian generic drugs, due to their relatively cheap prices, are used heavily to fight HIV/ Aids in Africa

 In 2006, India launched its flagship aid initiative in Africa, Pan-African e-Network, the continent’s largest tele-education and
telemedicine initiative.

 The network links 47 African countries with schools and hospitals in India through satellite and fiber-optic links.

India’s challenges in Africa


 China strong presence in the continent
 Political instability in number of African Nation may impact India’s long term investment opportunities
 An extraordinary increase in terrorist attacks by extremists connected to al-Qaida and ISIS across Africa recently
 In recent months, there has been a spate of assaults on Africans based in India. These assaults generate a negative
image of India in Africa

China Vs India in Africa


The growing Sino-Indian involvement has been economically beneficial and has resulted in widespread investment
and development, with African leaders welcoming the competition.
While China’s aggressive economic approach has caused it to achieve more influence in Africa, its dominance is
slowly being impeded by India’s growing involvement in the region. India has focused on emphasizing its cultural and
historical ties to enhance its trade relations with resource-rich countries of Africa for ex. Sudan, where Indian
corporations have attained near complete control of the local oil and natural gas industry.
 African nations are realizing that though Chinese investments are attractive, there are certain issues like:
 Chinese companies instead of employing locals use Chinese workers.

 Chinese companies don’t pay much attention to environment protection.

 Chinese loans come with strict conditions that only Chinese technology will be utilized.
 India needs to harness this opportunity. India already enjoys the good will of African people due to historical ties
and Indian company’s practices of employing local workers and skilling them.

Asia Africa Growth Corridor


 Indian and Japanese governments unveiled a vision document for the Asia Africa Growth Corridor.
 It is an attempt 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.

 Japan’s contribution to the project will be its state-of-the-art technology and ability to build quality infrastructure,
while India will bring in its expertise of working in Africa.
 Unlike China’s OBOR project Asia Africa Growth Corridor is conceived as a more open and inclusive programme
that will be based on more consultations and keep people as the centre piece rather than just trade and economic
ties.
India West Asia Relations
Importance of West Asia for India
 India has huge stakes involved in the region such as energy, trade and safety of Indian community in the region
 70 % of India’s imported energy needs come from West Asia & will increase as Indian economy grow
 11 million Indians working in West Asia. India is the largest recipient of foreign remittances from west Asia.
Therefore, stability in the region is high on India’s core agenda.
 Close cooperation is essential to counter radicalization in India
 To reduce the influence of china in west Asia and in Arabian Sea

Challenges in West Asia


Security situation in West Asia has been continuously deteriorating ever since the onset of Arab Spring in 2010. 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.
 Saudi-Iran rivalry: destabilizing West Asia and influencing West Asian geopolitics
 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.
 Pakistan is very close ally of many west Asian countries especially with GCC
 India’s close relation with Israel is another sore point with west Asia.
 India’s close relation with Iran may antagonize Saudi Arabia. India has to balance its ties with all three regional
power in west Asia-Iran, Israel and Saudi Arabia.
India’s “Look West” Policy
 A tri-directional foreign policy to accommodate the three key pillars of West Asia — Saudi Arabia, Iran and Israel
 A Secular and Non- Aligned Policy – Muslims and Jews / Shia-Sunni
 Driven more by economic calculation than political rhetoric.
 Major emphasis on Maritime Diplomacy + Energy and economic security

 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.
 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.

China West Asia Policy


China built ties with West Asian nations based on three principles — secure energy supplies, expand markets for
finished goods and find investment opportunities.
 For Iran, Beijing remained a trusted ally even during the time of sanctions
 It is one of the top buyers of oil from Saudi Arabia and a key trading partner of Israel
 China’s economic ties with West Asia assumed greater significance after One Belt, One Road initiative
 It repeatedly, along with Russia, vetoed the resolutions prepared by Western powers demanding the ouster of
Syrian President Bashar al-Assad, an ally of Tehran.
 China has also recognised Palestine as a state and offered support for the Palestinians
All over indicates a major shift from passive foreign policy of China to pro-active approach that suits the country’s big power ambitions.
From China’s point of view, Iran is among the most stable countries in the region. And it’s the only major country in
West Asia where the U.S. has practically no influence. So it’s natural for China to see Tehran as a vehicle entry into
West Asia. During Iran’s isolation era, China adopted a dual approach: it supported UN resolutions against Iran’s
nuclear programme while expanding economic and security cooperation with Tehran.

India ASEAN Relations


India adopted the “Look East Policy” soon after economic liberalisation in 1991 to increase economic & commercial
ties with East and Southeast Asian.
 ASEAN India Free Trade Agreement – An essential step towards deeper economic integration
 India was accorded full ASEAN Dialogue Partner Status in 1995, followed by its membership in ASEAN Regional
Forum. ASEAN has been a strategic partner of India since 2012.
 Commerce, Culture and Connectivity are the three pillars of India’s robust engagement with ASEAN.

 Under the AEP, India not only expected to bolster its economic engagements with the region; it yearned to emerge as a potential security
balancer as well.

India has attempted to demonstrate its ability to play a dynamic role in the region. India sent a strong signal to China
by mentioning the importance of maintaining freedom of navigation in the South China Sea, respecting United
Nations Convention on the Law of the Sea (UNCLOS)

ASEAN Significance
 ASEAN countries, particularly Myanmar, Vietnam & Malaysia can potentially contribute to India’s energy
security.
 The highly underdeveloped NE States of India, which lie at the gateway to a region offering unlimited economic
opportunities, will witness an economic transformation.
 Trade between India and ASEAN comprises 10.12% of India’s total trade with the world
 Conclusion of a balanced Regional Comprehensive Economic Partnership (RCEP) Agreement will further boost
our trade and investment ties with the region.
 Cooperation in areas such as maritime security including freedom of navigation, drug trafficking and cybercrime

‘Act East’ Policy


 India’s ‘Act East’ policy, upgraded from ‘Look East’ policy in 2014, serves as a platform for deepening and
strengthening its economic, cultural & strategic relationship with ASEAN and the East Asian economies.
 Providing enhanced connectivity to North East states of India ASEAN and the East Asian economies, has been a
priority in Act East Policy.
India has pushed a host of trans-national projects that seek to weave the region together:
 India has set up an Indian mission to the ASEAN in Jakarta, and has set up an ASEAN-India Centre which is
housed in New Delhi.
 Kaladan Multi-Modal Transit Transport Project will connect Myanmar to NE India
 Tamu-Kalewa-Kalemyo sector of the India- Myanmar-Thailand Trilateral Highway is a work in progress and is
expected to create a new dynamic in India’s multi-faceted ties with the region.
 India is also set to launch a Tracking & Data Reception Centre in Vietnam, which would make remote sensing data
available from Indian Satellites for applications in disaster management and mineral exploration for ASEAN
countries.
 ASEAN-India Agreement on Trade in Service and Investments has entered into force for India and seven ASEAN
countries

From Look East to Act east


The transformation from “Look East Policy” to Act East Policy is not merely of terminology. The AEP has gone way
far and wider than the Look East Policy –
 AEP has imparted greater vigour to India’s ties with ASEAN. Relations, which were stagnating, are again assuming
renewed vitality.
 India has now recognized that the success of AEP will be determined by its contribution to security and economic
development of Northeast India. And thus, many efforts have been in the direction.
 Relations with ASEAN now encompass security, strategic, political, counterterrorism, & defence collaboration in
addition to economic ties.
 The policy has sought to significantly expand its geographical coverage beyond ASEAN, to include other countries
like Japan, Australia, Pacific Island nations, South Korea, and Mongolia.
 Government has also sought to rejuvenate ties with countries that have been neglected in recent years, including
Australia, Fiji and Mongolia.

With ‘Make in India’ emerging as a key campaign for manufacturing, developing new global value chains in
partnership with the economies of ASEAN would bring benefits to both sides. India is also expected to play a
significant role in upholding the security and stability of the region, which India needs to get ready for.

Indian Ocean and India


India – surrounded by Indian Ocean on three sides – geographical location of India makes Indian Ocean integral part
of its foreign policy, security & trade decision.
 At present, Indian Ocean carries about half of world’s container shipment.
 Indian Ocean carries 90% of India’s trade by volume and 90% of oil imports
 India is highly dependent upon ocean resources such as fishing and aquaculture.
 India is also involved in deep sea mineral exploration in Central Indian Ocean with help from South Korea.
 Indian Ocean gives India access to the South-Asia, South East Asia, Africa, West Asia and Oceania – important
from the point of view of energy, economic trade and security
 After the attack on Mumbai and increasing presence of China in Indian Ocean, Indian Ocean has become an
integral part of India’s maritime policy
 The Indian Navy played a pivotal role in containing piracy on the high seas and is positioning itself as the “net
security provider” in the broader Indian Ocean region with capacity building & joint exercises

Challenges in IOR
 Maritime crime + Piracy + Security of choke points like Strait of Malacca & Sunda strait
 Drug hauls and human trafficking in South and Southeast Asia is rising exponentially
 Illegal migration & rise in refugee movement from Bangladesh & Myanmar resulted in a humanitarian crisis

Indian Ocean Rim Association


 International association of 21 Indian Ocean littoral states with India as a core member.
 Aims at strengthening Maritime Cooperation for economic association, regional integration promote sustainable
development and balanced regional growth

Way Ahead
 Littoral states should promote regional groupings like IORA which promote inclusive and sustainable regional
development.
 Initiatives such as SAGAR – Security and Growth for All in the Region – a good strategy to engage the regional
countries and counter not only Chinese presence but also increase the economic integration and security.
 Areas such as disaster management, technological advancement, blue economy, sustainable resource extraction,
humanitarian assistance should also be explored
India – A Soft Power
Soft power is the ability of a country to persuade others to do what it wants without resorting to force or coercion. Soft
power is the ability to shape the preferences of others through appeal and persuasion.
 Soft power lies in a country’s attractiveness and comes from three resources: its culture, its political values and its
foreign policies.
 Hard power encompasses military and economic means while soft power is about culture and values.
 Though slower to yield results, soft power is a less expensive means than military force or economic inducements
to get others to do what we want
India as a Soft Power
India boasts an amazing variety and wealth of soft power resources. Its spiritualism, Yoga, movies and television
soaps, classical and popular dance and music, its principle of nonviolence, democratic institutions, plural society and
cuisine have all attracted people across the world.
 Indian philosophy has captivated Western minds since the 1960s.
 The Indian cinema has long drawn huge audiences in significant parts of Asia, Africa, and beyond.
 The impressive participation around the world on International Yoga Day
 India has sophisticated systems of philosophy, psychology, medicine, science, social thought and spirituality,
containing a wealth of wisdom and transformative ideas for this new era of information technology.
 India has an elaborate and integrated artistic culture of music, dance, painting, poetry, sculpture and architecture,
covering human creativity in all its diverse forms.
 Indian soft power has enormous influence in the world – from religious and spiritual aspects to popular culture and
its IT-related expertise.

However there are few areas to be worked on -


 Cultural institutes like Germany has the Goethe Institute, China has its Confucius institutes, and France has the
Alliance Francaise – all over the world, where they offer individuals the chance to learn foreign languages and
attend cultural events such as movie showings and cooking classes.
 India’s National Museum does not feature on lists of top museums throughout the world. There is a need for a
world class museum in India.
 India should invest more in sports & recreational activities to draw tourists to partake in activities that they would
otherwise have to fly to Europe or America for. Ex. Skiing Culture
 India should do more to draw tourists to beautiful but relatively unvisited sites such as the Sun Temple in Orissa,
the ruins of Hampi in Karnataka, or the Spiti Valley in Himachal Pradesh. India should go beyond the image of just
the Taj Mahal and Rajput forts.

Without soft power, hard power lacks its intellectual and cultural edge. While soft power provides the ideas and
motivation, hard power gives the tools and weapons for the soft power to expand.

Shanghai Cooperation Organisation (SCO)


Importance of India’s Membership for SCO
SCO will now represent over 40% of humanity and nearly 20% of the global GDP. Experts say India’s inclusion may
even bring down Beijing’s overarching influence over the SCO. India, as the largest economy in southern Asia, has
much more to offer for the economic development of Central Asian countries. India’s inclusion expands the influence
of the organisation in international and regional affairs in various fields, especially in security, geopolitics and the
economy.

Importance of SCO’s membership for India


 will strengthen India’s position in Central Asia
 Greater access to major gas and oil exploration projects in Central Asia
 Greater cooperation in dealing with terrorism as well as on issues relating to security and defence in the region.
 A platform for India to engage Pakistan in a wider regional setting & help boost anti-terrorism cooperation
Challenges
 Presence of both India and Pakistan can limit the effectiveness of SCO as has been the case with SAARC
 On the issue of terrorism China and India have different attitude vis a vis Pakistan, hence SCO membership might
not help India in addressing concern in this context.
 India is the only country in SCO who has not joined OBOR. In all likelihood, China would use the SCO as a
vehicle to promote its massive connectivity and infrastructure project, and put more diplomatic pressure on India.
 The vision of SCO shared by Russia and China involves a ‘new order’, clearly aimed at the West. As a result, the
SCO has been often called the “Anti-NATO”, meant to counterbalance U.S. and Europe power structures. It would
seem incongruous to reconcile this with India’s close military ties with the U.S.
United Nations Organization (UNO)
 An intergovernmental organization established on 24 October 1945 to promote international co-
operation
 As a replacement for the ineffective League of Nations, the organization was created following the
Second World War to prevent another such conflict.
 At its founding, the UN had 51 member states committed to maintain international peace and
security, developing friendly relations among nations and promoting social progress, better living
standards and human rights; now there are 193.
 The Norwegian Foreign Minister, Trygve Lie, was elected as the first UN Secretary-General.

Headquarter New York

Official Languages Arabic, English, French, Chinese, Spanish, Russian

Members 193 (Latest Member South Sudan)

Secretary General Ban Ki Moon

Emblem Map of world b/w 2 olive branches (In white n Blue color)
The UNO has 4 main purposes
 To keep peace throughout the world;
 To develop friendly relations among nations;
 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;
 To be a center for harmonizing the actions of nations to achieve these goals.

Principle Organs of UNO

General Assembly (New York)


 Composed of all United Nations member states, the assembly meets in regular yearly sessions, but
emergency sessions can also be called
 Led by a president, elected from among the member states on a rotating regional basis, & 21 vice-
presidents
 Major work area of General Assembly consists of:
 Election of members to other UN organs

 Admission, suspension, and expulsion of member states

 Budgetary matters by majority of votes i.e. 2/3rd of the members present & voting

 Make recommendations on any matters within the scope of the UN, except matters of peace and
security that are under consideration by the Security Council
 Elects the non-permanent members of the UNSC; all members of ECOSOC; the UN Secretary
General (following proposal by the UNSC); and the fifteen judges of the International Court of
Justice (ICJ)

Security Council (Policemen of the world) (New York)


 Charged with maintaining peace and security among countries
 While other organs of the UN can only make “recommendations” to member states, the Security
Council has the power to make binding decisions on member states
 5 permanent members (Veto power) + 10 Non-permanent for 2 years

 The five permanent members hold veto power over UN resolutions, allowing a permanent member to block adoption of a resolution,
though not debate

 The ten temporary seats are held for two-year terms, with member states voted in by the General Assembly on a regional basis

 The presidency of the Security Council rotates alphabetically each month.

Secretariat (New York)


 Headed by Secretary-General who acts as the de factospokesperson and leader of the UN
 Secretary-General is appointed by General Assembly, after being recommended by the Security
Council
 Carries out tasks as directed by the Security Council, the General Assembly, the Economic and
Social Council, and other UN bodies.

International Court of Justice (The Hague, Netherland)


 Composed of 15 judges who serve 9-year terms; appointed by the General Assembly;
 Every sitting judge must be from a different nation
 Hear cases related to war crimes, illegal state interference, ethnic cleansing, and other issues
 ICJ’s primary purpose is to adjudicate disputes among states

Economic and Social Council (New York)


 Assists the General Assembly in promoting international economic and social co-operation and
development
 Has 54 members, which are elected by the General Assembly for a three-year term
 The president is elected for a one-year term and chosen amongst the small or middle powers
represented on ECOSOC
International Monetary Fund (IMF)
Bretton Woods
 Bretton Woods is a place in New Hampshire State of USA, just like BASEL is a city in Switzerland
 In 1944, President Roosevelt hosted a conference here, to rebuild the world economy, after Second World War.
 Delegates of 44 allied nations came to participate (India was represented by Sir D. Deshmukh, the first Indian
Governor of RBI)
 Officially known as United Nations Monetary and Financial Conference, commonly known as Bretton Woods
because of the place where it was held.

This conference resulted into creation of four important organizations viz.


 IMF (International monetary fund)
 World Bank
 GATT (General Agreement on Trade and Tarrif) – later becomes WTO in 1995
 Fixed Exchange Rate system (Discarded in 1970s)

Key Players in this meeting


 US President Franklin D Roosevelt
 UK Prime Minister Winston Churchill
 Harry Dexter White, S. Treasury
 John Maynard Keynes, UK treasury

International Monetary Fund


 HQ – Washington
 Official language – Chinese, English, French, Russian, Spanish, Arabic
 Formally created in 1945 by 29 member countries
 Stated goal was to assist in the reconstruction of world’s international payment system post World War II
 Countries contribute funds to a pool through a quota system from which countries with payment imbalances
temporarily can borrow money and other resources.

Organization’s objectives as stated in the Articles of Agreement


 To promote international economic co-operation,
 To promote international trade,
 To promote employment and exchange-rate stability,
 Make financial resources available to member countries to meet balance of payments needs

Upon initial IMF formation, its two primary functions were:


 to oversee the fixed exchange rate arrangements between countries
 to provide short-term capital to aid balance of payments

IMF’s role was fundamentally altered after the floating exchange rates post 1971
 Shifted to examining the economic policies of countries
 Researched what types of government policy would ensure economic recovery
 Its function became of surveillance of the overall macroeconomic performance of its member countries
 Now manages economic policy instead of just exchange rates + Promotes international trade
 Publishes surveys on world economy → World Economic Outlook

IMF Quota & Voting Rights


 Quotas was assigned to member countries reflecting their relative economic power & credit deposit to IMF
 Subscription was to be paid 25% in gold or currency convertible into gold (effectively the dollar, which was the
only currency then, still directly gold convertible for central banks) and 75% in the member’s own currency
 Members were provided voting rights in proportion to their quota, hence member countries with higher quota have
a higher say at IMF

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
Reverse Tansche
 A certain proportion of a member country’s quota is specified as its reserve tranche.
 The member country can access its reserve tranche funds at its discretion, and is not under an immediate obligation
to repay those funds to the IMF.
 Member nation reserve tranches are typically 25% of the member’s quota.

Given its unequal voting power mechanism, IMF doesn’t always serve the interests of poor & developing countries, hence
requires two set of reforms

IMF reform in quota


 IMF Executive board decides the Quota of each member based on various parameters including GDP & tariff
barriers.
 Higher quota gives higher voting rights and borrowing permissions, But formula is designed in such way US has
~18% quota, G7 collectively own >40% while India and Russia have barely ~2.5% each.
 BRICS, G20 and emerging market economies are against this scheme especially after Subprime crisis and declined
economic strength of USA & G7
 2010: Board decided to increases quota of developing countries albeit mainly by decreasing the quota of poor
countries.

Problem : 70% votes required to implement this reform, not 70 nations, & the nations who collectively own 70%
quota- USA, Germany, Japan etc. Hence quota reform is pending.

IMF reform in governance


 Currently in Executive board, 5 out 24 directors are permanently decided by five largest quota holders.
 2010: new reforms proposed: Board composition will be reviewed every 8 years + all directors to be elected, no
permanent chairs.

Problem: Requires 85% votes in favor, hence governance reform is pending as well.
World Bank (WB)
 HQ – Washington
 Set up in 1944 with a charter to drive post-World War II reconstruction
 Officially known as IBRD ( International bank for reconstruction and Development)
 Provide long term soft loans to rebuild the third world (Soft loans → interest rate is very low)
 The official goal or mission of the World Bank is reduction of poverty
 Aim – Promotion of foreign investment and international trade + Facilitation of capital investment

World Bank Consists of Two Institutions viz.


 The International Bank for Reconstruction and Development (IBRD)
 The International Development Association (IDA)
World Bank Group Comprises of Five organizations viz.
 The International Bank for Reconstruction and Development (IBRD)
 The International Development Association (IDA)
 International Finance Corporation (IFC)
 Multilateral Investment Guarantee Agency (MIGA)
 International Centre for Settlement of Investment Disputes (ICSID)

Key Function Areas (Same as MDG)


 Universal Primary Education
 Gender Equality
 Reduce Child Mortality
 Improve Maternal Health
 Poverty and Hunger
 Combat HIV/AIDS, Malaria, and Other Diseases
 Ensure Environmental Sustainability
 Develop a Global Partnership for Development

Voting Power
 Voting power is based on economic size + International Development Association contributions.
 In 2010, voting powers at the World Bank were revised to increase the voice of developing countries, notably
China. The countries with most voting power are:

 United States (15.85%)

 Japan (6.84%)

 China (4.42%)

 Germany (4.00%)

 United Kingdom (3.75%)

 France (3.75%)

 India (2.91%)

 Russia (2.77%), Saudi Arabia (2.77%) and Italy (2.64%)


New Development Bank (BRICS Bank)
New Development Bank (BRICS Bank)
 Agreed in 5th BRICS summit held in Durban, South Africa in 2013
 6th BRICS summit held in Fortaleza, Brazil, 2014, signed the document for $100 billion BRICS Development
Bank and a reserve currency pool worth over another $100 billion
 Headquartered at Shanghai with African Regional Centre at Johannesburg
 1st President – India, Chairman of the Board of directors – Brazil, Chairman of Board of governors – Russians
Terms & Objectives
 Primary focus of lending will be infrastructure projectswith authorized lending of up to $34 billion annually
 Will have starting capital of $50 billion, with capital increased to $100 billion over time
 Brazil, Russia, India, China & South Africa will initially contribute $10 billion each to bring the total to $50 billion
 No member can increase its share of capital without other 4 members agreeing – a primary requirement of India
 The bank will allow new members to join but the BRICS capital share cannot fall below 55%
 Official Languages – Chinese, English, Russian, Portuguese, 22 official languages of India

Initial authorized capital 100 billion

Initial subscribed capital 50 billion (each member gave 10 billion)

Total → 100 billion

 China → 41 Billion
Contingency reserve arrangement (CRA)  Brazil, India, Russia → 18 Billion Each
 S Africa → 5 billion

 Chinese
 English
 Portuguese
 Russian
Official language
 22 Official Languages of India

Contingent Reserve Arrangement (CRA)


 Provision of support through liquidity & precautionary instruments in response to potential short-term balance of
payments pressures
 To provide protection against global liquidity pressures including currency issues where members’ national
currencies are being adversely affected by global financial pressures.
 Total $100 Billion – China will contribute $41 billion, Brazil, Russia and India would give $18 billion each, and
South Africa would contribute $5 billion
IMF, World Bank & BRICS

Data IMF World Bank BRICS Bank

By which 6th BRICS summit at


summit? Bretton Woods, USA Fortaleza, Brazil

2014, July. Although


Year 1944 ops may by 2016.

HQ Washington Shanghai, China.

members 188 188 (IBRD); 172 (IDA) only five

Different voting powers based Differs according to All five members have
voting power on Quota system. shareholding equal voting power.

IBRD, IDA, IFC, ICSID &


components – MIGA –

 Poverty reduction to 3%
 Loans for
 Loans to solve Balance of by 2030.
infrastructure and
Payment (BoP) crisis.
 Soft loans for sustainable
 Technical assistance in development projects. development projects
policy making
 Promoting foreign  Helping country in
Purpose  Surveillance over investment and balance of payment
International economy international trade. (BoP) crisis

Why BRICS Bank Born


 BRICS – Collectively 1/5thof World GDP and 2/5th of world population
 No reforms in IMF or Word Bank → Highly dominated by USA & G7
 To defend BRICS economy from volatility in dollar exchange rate
 In the long run, it’ll make Chinese Yuan as an alternative to US Dollar, for global financial system

RBI Governor Rajan- “we did not setup BRICS bank to challenge World bank and IMF. This bank is setup only to
provide “patient money” to BRICS nations, because World Bank and IMF are taking too much time to reform
themselves.”

World Trade Organization (WTO)


 Officially commenced on 1 January 1995 under the Marrakesh Agreement, replacing the General Agreement on
Tariffs and Trade (GATT), which commenced in 1948
 An organization that intends to supervise and liberalize international trade
 HQ – Geneva, Switzerland
 Official language – English, French, Spanish

Evolution of WTO
Bretton Woods conference wanted to make ITO (International Trade Org.) but USA did not ratify.
1944 Thus, GATT was born as a stopgap arrangement
GATT (General Agreement on Trade & Tariffs) established aimed to reduce barriers to international
1947 trade

 Uruguay Round of Talks

1986  Service & Intellectual Property rights related topics included in the debate, 1993, everyone agreed
on it

 Marrakesh treaty under Uruguay round of talks at Morocco


 All nations signed on agreement & WTO was established on Jan 1, 1995
1994
 India → Founding member of WTO

WTO Structure
 Supreme Decision Making body
 160 members, Latest member → Yemen (Capital: Sanaa)
 Meets once every two years,
 Deliberates on trade agreements
Ministerial
Conference  Appoints Director General

 Day to day Decision Making body


 Meets regularly at Geneva.
 Implements decision of ministerial conferences
 Has Representative from each member state.
 Has two bodies, with separate chairmen
 Dispute settlement body

General Council  Trade policy review body

 Appointed by ministerial conference


 Has four years term.

Director General  Heads Secretariat at Geneva

Important Terms Before Understanding Functions of WTO


All countries want to protect domestic industries and prevent entry of foreign players. So, they create two types of
barriers to International trade viz.

 Tariff Barriers → When Govt. puts heavy import duty / custom duty on Foreign Products which protects domestic
players from competition from foreign players
 Non Tariff barriers → When Domestic players are given subsidies / preference over the foreign players by Govt.
for Ex.

 When Govt. is buying some Phones/ Xerox Machines, in the tender it’ll mention that only Domestic companies are allowed.

 Making polices in a way that it’s hard for foreign player to start factory / introduce his product in India
Key Functions of WTO
 Reduce above stated barriers to international trade – both tariff barriers and non-tariff barriers & Get the members
enter into multilateral trade agreements.
 Provide forum for negotiation & dispute settlement for members, if agreements are violated.
 Ensure the developing countries benefit from world trade, especially the least Developed countries
 Cooperate with UN, World and IMF for a global economic policy that improves livelihood, protects environment
and promotes sustainable Development.

Safety Protection Agreements with regards to Tariff & Non-Tariff Barriers


Non-food
products Technical Barriers to Trade Agreement (TBT) → Based on Quality & Durability

Food Products Sanitary and Phytosanitary Measures Agreement (SPS) → Based on Hygiene & Quality

WTO Agreements
 General Agreement on Tariffs and Trade (GATT)
 Agreements on
 Agriculture

 Textile

 Antidumping

 Safety / Quality check


 Sanitary and phytosanitary agreement (SPS)

 Technical barriers to trade (TBT)

 Trade related investment measures (TRIMS)

Goods  Subsidies and countervailing measures (SCM)

 General Agreement on Trade in Services (GATS)


 To ensure that services’ import/export enjoys the same principles of free and fair trade, just like the trade in
Services goods
Trade related intellectual property rights (TRIPS) – Protects seven categories of IPR
viz.

 Copyrights
 Patents
 Trademarks
 Geographical indicators
 Industrial designs
 Integrated circuit layout-designs

IPR  Trade secret

 To enforce the trade agreements and commitments made by individual member


country
 Once a complaint is filed, first, the parties are allowed to sort the issue through
mutual consultation

Dispute settlement  If that fails, formal adjudication by an expert panel

 Periodically, WTO carries out audit/inspection/review of the trade policy of


Policy Review member states and gives them constructive feedback

Plurilateral  Not signed by all countries – Civil aircrafts, Government procurement, Dairy
Agreements Products, Bovine meat
Hot Topic in News → Agreement on Agriculture, WTO wants to
 Reduce import duty
 Reduce export subsidies
 Reduce Amber box subsides (Domestic subsidies)

 Agriculture R &D, Training programmes, Flood / Drought relief to farmers etc.


 Subsidies that don’t disrupt trade balance or cause minimum damage to trade balance

Green Box  WTO Limit → Nothing

 Amber type Subsidies that aim to limit production


 Subsidies that don’t increase with production
 For example subsidies linked with acreage or number of animals

Blue Box  WTO Limit → Nothing

 Subsidies that disturb trade balance like subsidies on fertilizers, seeds, power and
irrigation.
 By this, country’s product becomes cheaper than others, in the international market

Amber Box  WTO Limit – De Minimus

Amber Box: De Minimus limits


 The minimal amounts of Amber box subsides permitted by WTO, even though they distort trade
 Calculated on the agriculture production of the given member state in 1986-88
 Limits – Developed ( 5%), Developing (10%), Least Developed (Exempted)

India’s stand
 In 1986: USA agriculture production was far ahead of India. So, their 5% De-minimus quota will be far bigger than
our 10% quota (in absolute figures).
 Input costs have skyrocketed in these decades. But, De-minimus doesn’t consider inflation factor.
 So, if India has to limit its (Amber box) agro. subsidies to a non-inflation adjusted 86’s production; we cannot
continue the MSP to farmers or food security to poor.
 These subsidized foodgrain are meant for feeding the poor only, they do not distort international trade.

Bali summit and Peace clause (Indonesia)


Trade Facilitation Agreement To cut down the red tape in customs clearance

Exporters from Least developing countries, will get Duty free, quota free
LDC Exports (DFQF) access to markets in foreign countries

Food stockholding Led to Peace clause


Peace clause
 No member, can drag any developing country to Dispute settlement mechanism of WTO for violation of De-
minimus limits in AoA, Provided that the said developing country -

 is paying subsidies for staple foodcrops for public stockholding program & food security purpose.

 is providing annual information of its food security Program to WTO.

 Permanent solution will be taken no later than 11th ministerial conference i.e. at December 2017.

Trade facilitation agreement (TFA)


 Member nations to publish a detailed list of procedure for import-export, fees, inspection rules, penalties etc.
 Minimize the proof documents and clearance required for customs clearance
 Provide electronic payment of fees, duties, taxes → Reduce red tapes and bureaucratic hassles in customs clearance
 Setup a single window mechanism to help trader submits all documents at a single point- preferably online.
 Provide faster customs clearance to perishable goods (Fruits, veggies, flowers).
 Give Advance ruling, as and where applicable.
 Trader should be notified immediately, if goods are detained at customs.
 LDC will get financial and technical help to comply with above rules.

 Benefits – Increase global GDP by $1 trillion (~Rs 60 lakh crore) + more jobs approx. 21 million
 Deadline – 2014, July, 31st But India refused + Agreement becomes effective from – 2015

India refused to sign Trade Facilitation agreement because –


 TFA maintains that it doesn’t diminish the rights & obligations of members under other agreements of WTO
 For example, under the Agreement on Agriculture (AoA) if a developing country is giving Amber box subsidies
beyond 10% of its national agriculture production (base year 1986), then other members will be justified in putting
trade sanction or WTO-complaint against the said country.
 Once India has signed TFA, the developed countries may stonewall their demands for a rational change in base
year and ceiling limits on agro. Subsidies.
 Then India will have to cut down agro. Subsidies in MSP and food security programs, else they’ll put sanctions on
us, soon as Peace-clause “temporary” deadline is over in 2017!
 And yet, we’ll have to keep giving them easy customs clearance because we signed the TFA!

Therefore, Government has decided to use TFA signature as a “Bargaining Chip” for a permanent solution of food
subsidies issue.

India-US agreed to resolve differences over public stockholding for food security under WTO
As per the deal agreed between India and the US, the Peace Clause under Bali package will be allowed to continue in
perpetuity and India’s food security programme will not be challenged under the WTO rules until a permanent
solution to it is found.

 However, bilateral agreement between India and the US need an endorsement by 160 WTO members.
 The agreement will help pave the way for reaching a consensus on Bali Package of WTO and help implement far
reaching reforms of custom rules under TFA.
 Further, it will help India continue its food security programme and food subsidy.
South Asian Association for Regional Cooperation (SAARC)
 An economic & geopolitical organization of 8 countries that are primarily located in South Asia
 Established in 1985; Secretariat – Kathmandu, Nepal; Official language – English
 Members – India, Pakistan, Bangladesh, Nepal, Bhutan, Srilanka, Maldives, Afghanistan
 1st summit at Dhaka, only 1 new member added since birth i.e. Afghanistan

 19th SAARC submit → Pakistan + Cultural Capital → Bamyan (Afganistan)

Evolutuion of SAARC
 The idea of regional political and economic cooperation in South Asia was first raised in 1980 and the first summit
was held in Dhakaon 8 December 1985, when the organization was established by the governments
of Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan and Sri Lanka.
 Since then organization has expanded by accepting one new full member, Afghanistan, and several observer
members.
 The official meetings of the leaders of each nation are held annually whilst the foreign ministers meet twice
annually.

SAARC Objectives
 SAARC policies aim to promote welfare economics, collective self-reliance among the countries of South Asia,
and to accelerate socio-cultural development in the region
 To promote the welfare of the people of South Asia and to improve their quality of life
 To cooperate with international and regional organizations with similar aims and purposes
 To promote active collaboration and mutual assistance in the economic, social, cultural, technical and scientific
fields
 To contribute to mutual trust, understanding and appreciation of one another’s problems; & to maintain peace in the
region

Developments in SAARC
 South Asian Free Trade Area (SAFTA) – to reduce customs duties of all traded goods to zero by the year 2016
 Visa Exemption Scheme – certain categories of dignitaries should be entitled to a Special Travel document, which
would exempt them from visas within the region
 Regional Railways Agreement
 Motor Vehicles Agreement
 Framework Agreement for Energy Cooperation (Electricity)
 SAARC Region Satellite launch plan

South Asian Free Trade Area (SAFTA)


The Agreement on SAARC Preferential trading Arrangement (SAPTA) was signed on 11 April 1993 and entered into
force on 7 December 1995, with the desire of the Member States of SAARC (India, Pakistan, Nepal, Sri
Lanka, Bangladesh, Bhutan and the Maldives) to promote and sustain mutual trade and economic cooperation within
the SAARC region through the exchange of concessions.
 The South Asian Free Trade Area (SAFTA) is an agreement reached on 6 January 2004 at the 12th SAARC
summit in Islamabad, Pakistan.
 It created a free trade area of 1.8 billion people in Afghanistan, Bangladesh, Bhutan, India, Maldives,
Nepal, Pakistan and Sri Lanka
 The seven foreign ministers of the region signed a framework agreement on SAFTA to reduce customs duties of all
traded goods to zero by the year 2016.
 The SAFTA agreement came into force on 1 January 2006 and is operational following the ratification of the
agreement by the seven governments.

SAARC Visa Exemption Scheme


 SAARC Visa Exemption Scheme was launched in 1992 to allow certain categories of dignitaries to a Special
Travel document, which would exempt them from visas within the region.
 Currently the list included 24 categories of entitled persons, which include Dignitaries, Judges of higher courts,
Parliamentarians, Senior Officials, Businessmen, Journalists, Sportsmen etc.
 The Visa Stickers are issued by the respective Member States to the entitled categories of that particular country.
 The validity of the Visa Sticker is generally for one year.
 The implementation is reviewed regularly by the Immigration Authorities of SAARC Member States.
The development potential of SAARC has been hindered by various factors viz.
 India Pakistan bilateral issue
 India’s bilateral issue with other countries like Sri Lanka, Bangladesh
 Trust deficit between India and its neighboring countries
 Cross border Terrorism
 Political instability in the Pakistan, Afghanistan and Maldives
 Low Human development Index and resource problems in the region
 Persistent problems of population, poverty, illiteracy, climate change, health, terrorism, flood and droughts
OPEC, ADB, NAM, NATO
Organization of the Petroleum Exporting Countries (OPEC)
 Organization of the Petroleum Exporting Countries (OPEC) is an international organization and economic cartel
whose mission is to coordinate the policies of the oil-producing countries.
 The goal is to secure a steady income to the member states and to collude in influencing world oil prices through
economic means.

Headquarter Vienna, Austria (Previously, At Geneva, Switzerland)

Formed by Baghdad Conference on 10–14 September 1960

Founding Members ( 5 Members) Iraq, Iran, Kuwait, Saudi Arabia and Venezuela.

Libya, UAE, Qatar, Indonesia, Algeria, Nigeria, Ecuador, Angola,


Later Joined By ( 9 Members) and Gabon

Left OPEC Gabon

 OPEC membership is open to any country that is a substantial exporter of oil and that shares the ideals of the
organization → (Currently 13 members)
 The 13 countries account for 40 percent of global oil production and 73 percent of the world’s “proven” oil
reserves, making OPEC a major influence on global oil prices

Being an organization consisting of the world’s major oil-exporting nations, OPEC is a cartel that aims to manage the
supply of oil in an effort to set the price of oil on the world market, in order to avoid fluctuations that might affect the
economies of both producing and purchasing countries.

Asian Development Bank (ADB)


 The Asian Development Bank (ADB) is a regional development bank established on 19 December 1966
 Headquarter at Metro Manila, Philippines
 Aimed to facilitate social and economic development of countries in Asia
 From 31 members at its establishment, ADB now has 67 members, of which 48 are from within Asia and the
Pacific and 19 outside
 The ADB was modeled closely on the World Bank, and has a similar weighted voting system where votes are
distributed in proportion with members’ capital subscriptions
 Japan 67%

 United States 56%

 China 47%

 India 36%

 Australia 81%

Non Aligned Movement (NAM)


 Founded in Belgradein 1961 by Nehru (India), Unu (Burma), Sukarno (Indonesia), Nasser (Egypt), Nkumarah
(Ghana) & Tito (Yugoslovakia)
 Objective → A group of states which are not formally aligned with or against any major power bloc
 Membership is particularly concentrated in countries considered to be developing or part of the Third World
 At present NAM has 120 member states & 15 observer states
 The 17th Summit of the Non Aligned Movement is to be held in Venezuela in 2016

Five principles of NAM


 Mutual respect for each other’s territorial integrity and sovereignty
 Mutual non-aggression
 Mutual non-interference in domestic affairs
 Equality and mutual benefit
 Peaceful co-existence

North Atlantic Treaty Organization (NATO)


 North Atlantic Treaty Organization (NATO) is basically a military alliance, born out of the North Atlantic Treaty
on 4th of April, 1949.
 It is a political and military alliance whose primary goals are the collective defence of its members and the
maintenance of a democratic peace in the North Atlantic area.
 Headquartered at the Belgium capital city of Brussels, the NATO introduced a collection of defense systems, as a
result of which, its member-states agreed upon a common defense system, in the face of external invasions.
 All 28 Allies have an equal say, the Alliance’s decisions must be unanimous and consensual, and its members must
respect the basic values that underpin the Alliance, namely democracy, individual liberty and the rule of law.
NATO’s Core Tasks
 Collective Defence
 Crisis management
 Cooperative security through partnerships

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