Author: Explains

Basic features of Indo-Nepal treaty of peace and friendship

1. Nepal is the only vital neighbour as it shares an open border with India.
2. India and Nepal initiated their relationship with the signing ten articles treaty of 1950, “Indo-Nepal Treaty of Peace and Friendship”.
3. The treaty allows free movement of people and goods between the two nations and a close relationship and collaboration on matters of defense and foreign policy.
4. This allows the reciprocality for Nepalese and Indian citizens to move freely across the border without passport or visa, live and work in either country and own property or conduct trade or business in either country.
5. However, a section of Nepalese received this treaty as violation of their sovereignty.
6. The extensive Indian trade and economic influence was also resented by some in Nepal.
7. In 1975 after the annexation of Sikkim by India, Nepal began openly lobbying for renegotiation of the treaty and proposed itself as a Zone of Peace between India and China.

Importance of Nepal for India and vice-versa

Cultural Importance

1. While enjoying their own peculiarities, both India and Nepal share common culture and ways of life.
2. Religion is perhaps the most important factor, and plays a predominant role in shaping the cultural relations between these two countries, marked by cross country pilgrimage on Char Dham Yatra, Pashupatinath Temple and some Buddhist sites.
3. A considerable section of Nepalese comprises of madhesi population which has familial & ethnic ties with states of Bihar, UP.
4. Although Nepal has its unique geography, history and cultural heritage still it is an integral part of the broader cultural history and tradition of Indian sub-continent.

Strategic Importance

1. Nepal is a buffer state between India and China.
2. It has an open border with India which leads to problems such as illegal migrants, counterfeit currency entry, drug and human trafficking.
3. Several Nepali Citizens are also deployed in Indian defense forces as well.

Political Importance

1. Constitutional turmoil is not new in Nepal. India has played a vital role in the democratic transition in Nepal against the monarch King Gyanendra.
2. Nepali Congress (NC) is one of the country’s oldest parties which supports relations with India, but the communist parties show a tilt towards China.

Economic Importance

1. Nepal is a important export market for India.
2. Himalayan rivers flowing through Nepal can be used for Hydroelectric power projects which will benefit border states of UP, Bihar and other adjacent areas.
3. There are three major water deals between Nepal and India, namely the Kosi Agreement, the Gandak Treaty and the Mahakali Treaty. India also exports Power to Nepal.
4. Also, Nepal is the largest borrower of Indian Currency in South Asia.

Examples of bilateral cooperation

1. The “Treaty of Peace and Friendship” was one of the landmark initiative of bilateral relations between India and Nepal.
2. Operation Maitri of 2015 reiterated India’s commitment towards relations with Nepal. The search, rescue and relief operations carried out by Indians.
3. Through this India once again proved its potential in role-playing and responsibility-bearing capacity in the region.
4. India also announced a post-earthquake reconstruction package of US$ 1 bn for Nepal.
5. India and Nepal have a Power Exchange Agreement since 1971 for meeting the power requirements in the border areas of the two countries.
6. In 2014, PM Modi won hearts of Nepalese Population by his address in Nepal’s parliament.

Irritants in bilateral ties

Grudges of Nepal

1. Anti-India Sentiment in Nepal is largely politically motivated as it is wrongly perceived as India’s backing to Monarchy.
2. The issue of open borders has also been a point of debate in Nepal in recent years- Nepalese people argue that the India is benefiting more from it than Nepal.
3. Nepal feels vulnerable and insecure because it is landlocked.
4. Increasing Chinese presence in Nepal is one of the major concern for India. China’s move to extend the rail link to its border with Nepal can reduce Kathmandu’s dependence on India.
5. Fundamentally these Chinese agencies are building up anti-India sentiments in Nepal.
6. Nepal’s assent for “One Belt One Region” (OBOR) initiative of China is viewed by India with suspicion.

Grudges of India

Madhesi Issue

1. Nepal adopted the new post-monarchy Constitution in 2015. Madhesi, a minority group residing in the Terai of Nepal, have been demanding a redrawing of federal boundaries.
2. The Nepali constitution has given equal representation on the basis of “geographical area” triggering a demand for separate Madhesi province.
3. Most of the key constitutional posts have been reserved for only citizens by descent hence surpassing Madhesis.
4. In line with Madhesi Protest, Indian supply was blockaded at the border points leading to acute shortage of essential commodities.
5. Nepal has accused India of imposing an undeclared blockade
6. This angered a large part of the Nepalese population, allowing China to step in as an alternative.

Human trafficking in Nepal

1. An estimated 100,000–200,000 Nepalese in India are believed to have been trafficked.
2. Sex trafficking is particularly rampant within Nepal and to India, with as many as 5,000–10,000 women and girls trafficked to India alone each year.

Border Issue

1. The unsettled border disputes at Kalapani and Susta have contributed substantially to the anti-Indian sentiments in Nepal.
2. Border crossings from undesignated posts is a matter of content for India.

India’s importance to Nepal

1. India is the nearest foreign employer to Nepali Citizens, which provides various avenues of work and ease in assimilation into a foreign culture.
2. India is the only potential neighbour who could harness Nepal’s hydropower.
3. Moreover, Indian tourists are the major movers of Nepal’s tourism sector.

Nepal’s Importance for India

1. Nepal is a feasible market for Indian exports and attracts huge economic dependence on India.
2. It acts as a strategic buffer state between India and China.
3. As discussed earlier, India is the only beneficiary to harness its immense hydropower capacity.
4. It is one of the major proponent and supporter of India’s interest on various International forums.

Way Forward

1. India can be the big-brother for Nepal in all sense.
2. The onus is on India to rethink on a long-term basis how to recalibrate its relationship with Nepal provided Nepal should not ignore its dependence on India.
3. India needs to continue to understand that there is another opportunity to rewrite bilateral and geopolitical history.
4. India needs to also realize the new reality that its monopoly over geopolitics in Nepal is over, and there is another relationship that Nepal is nurturing.
5. While China does not have people-to-people interactions with Nepal on a par with India, it has an open avenue for India to retain its strategic importance.

Why in News?

• India invited all ten heads of state of the Association of Southeast Asian Nations (ASEAN) as chief guests at the Republic Day celebrations.
• India and the ASEAN are also celebrating

1. 25 years of their rapidly expanding partnership.
2. 15 years of their Summit engagement.
3. Five years of Strategic their Partnership.

• In addition, ASEAN completed 50 years of its establishment.

India-ASEAN Relations

• Look-East Policy in 1992 gave an upthrust to India -ASEAN relation and helped India in capitalizing its historical, cultural and civilizational linkages with the region.
• India entered into a Free Trade Agreement(FTA) in goods with the region in 2003 which has facilitated the bilateral trade which now stands at approximately USD 76 Billion.
• The India-ASEAN Free Trade pact in services and investments, which was concluded in 2014 and came into effect a year later, has the potential to further reduce India’s trade deficit with ASEAN.
• Further, the launch of Act East Policy in 2014 has added a new vigour to India-ASEAN relations.
• ASEAN countries, owing to their strategic location in the Pacific Ocean, are also very crucial for maintaining the stability in the Indo-Pacific region.

Five-key focus areas for India and ASEAN

• Connectivity
  1. Physical connectivity remains a constraint in India-ASEAN trade relations.
  2. However, infrastructure projects like Trilateral Highway connecting India’s Northeast to Thailand, the Data Deep-sea Port in Myanmar, and the Kaladan Multi-modal Transit Transport Project have the potential to overcome the infrastructure bottleneck. Continued commitment and investment is needed.
  3. Apart from this, Non-tariff barriers should also be rationalized and the institutional mechanisms be streamlined to further augment the connectivity with the region.
• Maritime Security
  1. The maritime space in today’s world plays a key role not only in economic development but also in security and connectivity.
  2. Piracy, disputes over resources, territorial claims, terrorism, China’s increasing assertiveness, and a fractured governance system are creating instability in the Indo-Pacific region.
  3. Thus, ASEAN India cooperation is imperative for maintaining peace and stability in the region.
• Blue Economy
  1. Given India’s vast Exclusive Economic Zone(EEZ), there is huge potential in this sector that remains to be realized.
  2. India should deepen its engagement with ASEAN on this front through developing PPP models for fisheries sectors, knowledge sharing and joint efforts to conserve and manage coastal and marine resource.
• The Digital Age

Two things need to be considered under this :

Inclusive Growth

Technological disruptions may further increase inequality in incomes, digital access, and opportunities. Thus, India and ASEAN should focus on greater knowledge sharing and developing best practices for fostering inclusive growth.

Cyber Security

Policies governing cyberspace and cyber securities are in their nascent stage, in such scenario both India and ASEAN should seek to be a decisive voice in norm-setting, and in cultivating inter-regional cooperation for addressing cyber insecurity.

• Migration
  1. Because jobless growth in India, unemployment is on rise. In such scenario, ASEAN nations can act as an important destination for Indian immigrant workers.
  2. On the other hand, job creation is expected to rise in ASEAN countries like Singapore and Malaysia. There are gaps in labour supply across different sectors in ASEAN nations.
  3. Therefore, both India and ASEAN should work together to reduce barriers to immigration, and facilitate the freer movement of labour between them, as they both stand to gain.

Issues Hampering India-Asean Relations

• In bilateral trade, there is an imbalance as the majority of ASEAN countries have strong manufacturing bases that rely on export while Indian export remains feeble. Moreover, the current policy under Make In India is to promote domestic production.
• India still engages more with ASEAN countries on a bilateral basis rather than on a multilateral basis.
• India’s has a limited capacity to provide development assistance and other financial relation. Moreover, ASEAN’s inclination to harness India for regional stability remains limited because of the presence of other regional powers like China.

Conclusion

• On the trade front, there are certain concerns related to Free Trade Agreement in services. Services being India’s domain, India need to work on these concerns on a priority to give an impetus to exports in services.
• Efforts should also be made to finalise an agreement for free movement of labour so that both ASEAN and India could capitalize on each other’s resources
• Further, with increasing assertiveness of China Indo-Pacific region and the uncertain Trump administration in U.S. A, the cooperation between India and ASEAN become all more important to maintain rule-based order and stability in the Indo-Pacific region

Why in News

The fact that an Indian Prime Minister is making a visit for the first time in 25 years since we established full diplomatic ties is significant and termed historic in itself. The focus of the visit signifies 25th anniversary of diplomatic ties has opened a new chapter in the Indo-Israel bonhomie.

Advantage Israel

1. Israel, led by strong growth of private consumption, low inflation, rising labor force participation, a positive investors’ climate because of low interest rates, natural gas finds and responsible fiscal policies, has a lot to offer.
2. A modern economy like Israel goes well with our own flagship programmes like Make in India. Indian companies with their engineering and scale and Israeli companies with their innovation and technology can together stimulate our domestic manufacturing sector, particularly in defense.
3. Israel, at the same time, is considered as the most advanced country in SW Asia and the Middle East in economic and industrial development.
4. It is a developed country having a highly skilled and educated workforce. So, developing relations between the two is important.
5. Israel has become one of the foremost technology superpowers in areas such as rainwater harvesting, use of oceanic water and using that for irrigation in the most dry land.
6. Israel has transitioned from a water-deficit state to a water-surplus state, and has pioneered the water desalination technique, something that’s absolutely significant in the era of climate change, rapid loss of fresh water bodies, and rise in seawater levels.
7. Israel achieved self -sufficiency in food production despite having 50% barren Land. Its 3.7% of workforce produces 97% of its own food. India could well follow its path by using techniques from it like Drip Irrigation, Post-Harvest technology, Food Tissue culture, Plastic Culture , Vertical gardens etc.

Background of Indo- Israel relations

1. Since India established full diplomatic ties with Israel in 1992, relations between the two countries have grown at an astonishing pace, covering a wide range of issues from defence and homeland security, to agriculture and water management, and now education and even outer space.
2. The formal acknowledgement of the relationship at the highest levels leaving behind hesitations of history and India’s de-hyphenation of its Israel and Palestine policies for the first time (and taking the related course-correction measures such as rethinking India’s voting choices on anti-Israel resolutions at the UN and dropping the demand for East Jerusalem as capital of a future Palestinian state), is the turning point in the relations of both countries going forward.

Key areas of Camaraderie, cooperation and coordination

Hinged on defence, intelligence-sharing, counter-terrorism on one side and cooperation in water harvesting and agriculture on the other, there are a number of avenues in which India-Israel ties would be key to the emerging global order.

• Economic Engagement: Israel, led by strong growth of private consumption, low inflation, rising labor force participation, a positive investors’ climate because of low interest rates, natural gas finds and responsible fiscal policies, has a lot to offer.  Policy initiatives on ease of doing business and the opening of defense, construction and pharma sectors have added to India’s attractiveness as an investment destination.
• Defense collaboration: The India-Israel equation in defense has acquired strategic dimensions but there is need and opportunity to make it “more broad-based” through production and manufacturing partnerships. Israeli defense industries are well inclined towards joint ventures to give a boost to the ‘Make in India’ campaign.
• Innovation and Entrepreneurship Culture: Israel embodies a culture of entrepreneurship highlighted by the power of innovation, global leadership in R&D spending and venture capital investment. A joint innovation and research and development fund can work wonders.

A country that has no automotive industry for example, and yet they are the R&D centre for autonomous cars (self-driving) in the world.

• Agricultural Partnership and Water Conservation: Arid land technology, biotechnology and a joint action plan to research India specific and export-oriented seeds deserve attention. Israel has tackled its rain deficiency by developing technology solutions for waste water management, purification, desalination techniques and water reuse in agriculture and industry. The Israeli dairy industry with its proven know-how and design, technology and genetic material can revolutionize the dairy industry in India.
• Medical and Pharma sector cooperation: Medical technologies and devices could be the next growth areas for collaboration.
• Diaspora potential: Another important factor in bilateral ties will be the Indian diaspora. Most Jewish Indians, about 80,000, have all moved here, and there are just about 4,000-5,000 left in India.
• Academia-Industry- government Connect: We have to learn from their universities, how they have technology transfer companies based right on their campuses, who help convert theory into useful products in a very short period of time.
• Counter-Terrorism and Intelligence Sharing: India and Israel are boosting up the counter-terrorism cooperation and sharing real-time intelligence on issues crucial to national security.
• Military and Strategic Ties: Israel is the second-largest source of defense equipment for India, after Russia. Arms trade between the two nations reached almost $600 million in 2016. India has purchased Barak I missiles, 3 Phalcon AWACS, and Israeli spike anti-tank missiles from Israel. Israel is developing Barak 8 missile for Indian Navy and IAF and plans to purchase 2 more Phalcon AWACS are in progress.
• Space Collaboration: In 2002, India and Israel signed a cooperative agreement promoting space collaboration. India has successfully launched TecSAR and RISAT-2 radar imaging satellites of Israelfrom PSLV of ISRO.

Sticky Points in the Relations

1. Bilateral Trade and investment still below potential: From just $200 million in 1992, bilateral trade (excluding defense) peaked at about $5 billion in 2012 but since then it has dropped to about $4 billion. Also, bilateral trade has not diversified much—diamonds and chemicals still make up for the large chunk of the pie.
2. Private Sector still finding feet: Indian companies like Sun Pharma and ATG, a specialty tyre-maker, have big interests in Israel. But perhaps unsurprisingly, the Chinese are streets ahead of us in bilateral trade and their companies are investing heavily in Israel’s cutting-edge start-ups.
3. Connectivity between two countries still poor with just one direct flight from Mumbai 3 times a week and no direct flights from Delhi.
4. Historical retrenchment: India’s consistent support for a sovereign, independent, viable and united Palestinian state with East Jerusalem as its capital, living within secure and recognized borders, side by side and at peace with Israel and Pro-Arab stance has been a sticky point.
5. Limited People to People ties and cultural differences: Israelis and Indian approach business differently and often find it difficult to get on the same page. Though formal ties were established in 1992, but the ideological divide resurfaces time and again.

Way forward

1. Investments to boost tourism, education and cultural ties and building bridges with the Indian diaspora in Israel can help significantly in this context. Indeed, these are the low-hanging fruits in the bilateral relationship that can be plucked right away.
2. Taking cues of Israel’s industry-academia ecosystem, its innovation and start up culture and the state of art cutting edge technology across sectors; India can build mutual collaborations for present and future development.
3. Tapping each other’s potential should be the imperative in the new “Strategic Partnership” to truly make “India-Israel is a match made in heaven”

WHY INDIA NEEDS IRAN?

• Conventionally, for energy security

1. Iran is amongst India’s top oil suppliers

• But since the 1990s, Iran’s importance has become ‘strategic’

1. Iran’s cooperation is critical for India’s security given that
2. Pak supports terrorism in India
3. India’s influence in Afghanistan is marginal

• India needs Iran to moderate Pak’s influence in West Asia

1. Iran is a leader in the Muslim world
2. Pak is anti-India

• Access to Afghanistan and Central Asia
  1. Till 1947 (undivided India), India shared a border with Iran

WHY IRAN NEEDS INDIA

1. India is Iran’s second largest oil buyer after China.
2. While Iran is of strategic importance to India, the reverse is not true. India is, at best, a trade partner for Iran

IRRITANTS IN INDO-IRAN TIES

• Growing Saudi-India-US-Israel relations have irked Iran.
  1. in retaliation, Iran, for the first time, has linked the plight of Muslims in Gaza, Yemen, and Bahrain, with those in Kashmir
• Warming Iran-Pak-China ties have annoyed India.
• Slow Chahbahar port development has annoyed Iran
  1. Iran has indicated that the port will not be used exclusively by India and that China and Pak may be invited

JOINT COMPREHENSIVE PLAN OF ACTION (JCPOA)

• About the deal
  1. Signed between Iran and P5+1 (the five permanent members of the U.N. Security Council and Germany) in 2015.
  2. Iran agreed to a joint comprehensive plan of action (JCPOA) in return for removal of the economic sanctions against it.
  3. The JCPOA drastically reduced Iran’s uranium enriching capacity & levels, enriched stockpiles and centrifuges. Besides, it provided for stringent inspection and monitoring by international agencies.
• Has Iran complied?
  1. Yes. All other signatories as well as the UN (The IAEA) have confirmed Iran’s compliance of the deal (latest report, Aug 2017)
• Benefits for Iran
  1. Removal of sanctions boosted her economy. GDP grew at 9.2% in the latest quarter (jul-sep 2017).
• Why USA/Trump wants to trash the deal?

1. The present deal doesn’t address (US ally) Israel’s concerns adequately.
2. Moreover, Trump administration has never explicitly stated why it considers the JCPOA “the worst agreement in American diplomatic history”.

• Trump has been hawkish towards Iran since he took over as President.

1. Imposing new sanctions on its missile programmes and joining hands with its regional rivals in West Asia have been part of Trump’s Iran policy.

Possible ramifications of cancellation of the JCPOA

1. Hardliners in Iran will make a political comeback which will lead to uncertainty and instabilty in West Asian geopolitics
2. Threat of nuclear proliferation as Iran may resume its nuclear weapons programme.
3. Since EU supports Iran, the withdrawal will hurt US-EU relations. The Trans-Atlantic Security Partnership will lead to secondary US sanctions against EU companies dealing with Iran.
4. USA’s unilateral decision to withdraw will hurt its stature as a global leader.

Impact on India

• Indian Diaspora

1. Political instability in West Asia will undermine their security and remittances.

• Crude Oil

1. Iran accepts payment in Indian currency for its oil.
2. India will have to depend more on Saudi Arabia and Iraq for oil supplies.
3. Reduction of supplier diversity will make India more vulnerable to oil price shocks

• Chabahar

1. India could lose access to Chahbahar port of Iran which is a strategic necessity for India’s access to Central Asia.

• Iran-Pak-China

1. This axis could get strengthened.

Way ahead for India

1. India will have to maintain a fine balance between US, Israel and Saudi on the one hand and Iran on the other.
2. India should make greater use of Euro-denominated transactions for its oil trade to minimise the adverse impacts.
3. Also, efforts should be made to revitalise mechanisms like the Asian Clearing Union.

Why in News?

In last 1-year India has become the member of Australia group and the Wassenaar group

India Joins the Australia Group

• India has admitted as the 43rd member of the Australia Group
• The group is an informal bloc of countries that keep a tight control over exports of substances used in the making of chemical weapons

The Australian Group

• The Australia Group is a multilateral export control regime (MECR) and an informal group of countries (now joined by the European Commission) established in 1985 (after the use of chemical weapons by Iraq in 1984) to help member countries to identify those exports which need to be controlled so as not to contribute to the spread of chemical and biological weapons
• The group, initially consisting of 15 members, held its first meeting in Brussels, Belgium, in September 1989.
• With the incorporation of India on January 19, 2018, it now has 43 members, including Australia, the European Commission, all 28 member states of the European Union, Ukraine, and Argentina
• The name comes from Australia’s initiative to create the group. Australia manages the secretariat
• The initial members of the group had different assessments of which chemical precursors should be subject to export control
• Later adherents initially had no such controls
• Today, members of the group maintain export controls on a uniform list of 54 compounds, including several that are not prohibited for export under the Chemical Weapons Convention but can be used in the manufacture of chemical weapons
• In 2002, the group took two important steps to strengthen export control
• The first was the “no-undercut” requirement, which stated that any member of the group considering making an export to another state that had already been denied an export by any other member of the group must first consult with that member state before approving the export
• The second was the “catch-all” provision, which requires member states to halt all exports that could be used by importers in chemical or biological weapons programs, regardless of whether the export is on the group’s control lists
• Delegations representing the members meet every year in Paris, France

Significance for India

• With its admission into the Australia Group, India is now part of three of the four key export control groups in the world
• This includes the Missile Technology Control Regime, the Wassenaar Arrangement. The only export control group that India is not a part of is the elite Nuclear Suppliers Group (NSG)
• Series of multilateral export control groups that India has joined “helps in establishing our credentials” for joining the NSG.
• Joining the Australia Group would also help in “strengthening supply chain security in the dynamic industry fields of biotechnology and chemicals”, along with meeting non-proliferation objectives.

India joins the Wassenaar arrangement

• Elite export control regime Wassenaar Arrangement (WA) has decided to admit India as its new member

About Wassenaar Agreement

• The Wassenaar Arrangement was founded in 1996
• Its stated aim is “to contribute to regional and international security and stability, by promoting transparency and greater responsibility in transfers of conventional arms and dual-use goods and technologies, thus preventing destabilizing accumulations.”
• Its (WA) member countries are required to ensure that transfers of these items do not contribute to the development or enhancement of military capabilities which undermine these goals. The aim is also to prevent the acquisition of these items by terrorists.
• New members are accepted based on specific criteria, including countries which produce/export arms or associated dual-use goods and technologies; establish national policies that restrict sale of arms and sensitive technologies to countries of concern; and adhere to non-proliferation regimes.
• It is clubbed with mechanisms such as the Nuclear Suppliers Group (NSG), the Missile Technology Control Regime (MTCR) and the Australia Group
• It comes on the heels of membership last year of the MTCR.

Why did India get membership of Wassenaar Arrangement?

• Even though India is not a signatory to the Non-Proliferation Treaty, it has managed to make its entry into the Wassenaar group.
• India has managed to do that by updating its export control lists earlier this year, to bring it in line with international standards, including those required by the Wassenaar Arrangement.
• To be precise, India approved SCOMET (Special Chemicals, Organisms, Materials, Equipment, and Technologies) items, mandatory under the Wassenaar Arrangement. Through the revised list of items, India also seeks to send a message about its larger commitment to non-proliferation.

Significance for India

• Boost international image: India’s formal entry into this group would further boost its image in the international arena.
• Enhance its credentials in the field of non-proliferation: Even though India is not a signatory to the Non-Proliferation Treaty, it has managed to make its entry into the Wassenaar group, which would enhance its credentials in the field of non-proliferation.
• India has built strong for NSG: With this development, India’s has built a strong case for its entry into the Nuclear Suppliers Group (NSG), which was opposed by China last year
• Facilitate high technology tie-up: It will also facilitate high technology tie-ups with Indian industry and ease access to high-tech items for our defence and space programmes. It will also create grounds for realignment of India in export control policy framework of other WA members, including eligibility for certain licensing exceptions.
• Enhances India’s chance to be member of UNSC: Being a responsible state in the international system, India is eyeing to play a more proactive role globally. Being a part of major groups like WA enhances India’s chances to get a permanent seat in United Nations Security Council in future.