Indian Politics & Policy Volume 1, Number 2, Fall 2018 | Page 81

Indian Politics & Policy
Talks in 2004–05 between the
new UPA government in India and the
Bangladesh government included the
biannual Director-General-level talks
between the two border guard forces,
the issue of insurgent and radical Islamist
groups, sharing of the Teesta river
waters, illegal immigration, trade, investment
and the possible Myanmar–
Bangladesh–India gas pipeline, and
the annual meeting of the Joint Rivers
Commission. The year 2006–07 saw
a revised Trade Agreement. The Joint
Boundary Working Group met after
a gap of four years and discussed the
Land Boundary Agreement of 1974. An
Indo-Bangladesh Chamber of Commerce
and Industry was inaugurated in
2007–08 and a trial run of the Kolkata
(Calcutta)–Dhaka passenger train took
place, leading to the start of rail services
the next year. A trade agreement and a
BIPPA were signed in February 2009.
The Grand Alliance (GA) government
led by the Awami League of
Sheikh Hasina Wazed was formed in
January 2009 and took steps to improve
relations with India. She visited India in
January 2010, following which an LOC
of $1 bn for infrastructure projects,
including railways, was signed in August,
as was a 35-year power transmission
agreement. Indian prime minister
Manmohan Singh visited Bangladesh in
September 2011 resulting in the Land
Boundary Demarcation Agreement, an
increase in the annual duty-free export
quota of garments to India, a joint venture
agreement for the 1,320 MW Khulna
power plant, and increased defense
cooperation and an increased number
of ITEC and Colombo Plan training
slots. More recently, Prime Minister
Modi announced an additional $2 bn
credit line focused on infrastructure in
his 2015 visit, which also saw the resolution
of the long-festering boundary
issue. The stepping up of assistance is
clearly linked to the cooperative attitude
of the GA government and the
perceived importance of its stability for
Indian security. However, Indo-Bangladesh
trade remains sluggish, with India
accounting for only 13 percent of Bangladesh’s
imports, in sharp contrast to
dominating the imports of landlocked
Nepal and Bhutan.
Sri Lanka
Sri Lanka, which was in the throes of
a long-drawn out separatist war over
1983–2009 between the government
and the Liberation Tigers of Tamil Eelam
(LTTE), a separatist guerilla group of
the hitherto discriminated-against Tamils
of the North and East of the island,
signed a free trade agreement with India
in 1998, operational from 2000, called
the India–Sri Lanka Free Trade Agreement.
This gradually liberalized trade
ahead of the South Asian regional trade
liberalization process and also had the
effect of encouraging Indian investment
in Sri Lanka to take advantage of lower
tariffs on raw materials, and consequent
export of products back to India. The
free trade agreement and the domestic
peace process between the Tamil
rebels and the government, marked by
the Ceasefire Agreement of 2002, led
to an improvement of Indo-Sri Lanka
relations, and Sri Lanka supported India’s
bid for a permanent UNSC seat.
There were the beginnings of moves
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