India–Bangladesh Relations: Addressing the Trust Deficit

After Reading This Article You Can Solve This UPSC Mains Model Question: 

The future of India’s Neighbourhood First Policy will be significantly influenced by the trajectory of India-Bangladesh relations. Critically examine. 15 Marks (GS-2, International Relation) 

Context

The political transition in Bangladesh after the formation of the Tarique Rahman government has not translated into a corresponding improvement in India-Bangladesh relations. Persistent differences over trade, migration, water sharing, and evolving regional geopolitics continue to test mutual trust and strategic cooperation.

Introduction

India and Bangladesh share deep historical, cultural, economic, and strategic ties. As immediate neighbours linked by geography and numerous transboundary rivers, stable bilateral relations are essential for regional peace and prosperity. However, political changes in Bangladesh following the 2024 uprising have introduced new uncertainties, leading to mutual mistrust and diplomatic friction. The current phase underscores the need for pragmatic engagement and confidence-building measures from both sides.

Historical Evolution of India–Bangladesh Relations

1. Shared Historical and Cultural Legacy

• India and Bangladesh share deep civilisational, linguistic, and cultural ties rooted in the history of undivided Bengal.
• The Bengali Language Movement (1952) became a cornerstone of Bangladeshi nationalism and identity.

2. Liberation War and Birth of Bangladesh (1971)

• India played a pivotal role in Bangladesh’s Liberation War by supporting the Mukti Bahini, hosting millions of refugees, and providing military assistance.
• This laid the foundation of a special bilateral relationship often described as a “Liberation Partnership.”

3. Fluctuating Relations after 1975

• Following the assassination of Sheikh Mujibur Rahman, relations witnessed periods of mistrust due to military rule, border issues, migration concerns, and water-sharing disputes.
• Bangladesh also sought to diversify its foreign relations beyond India.

4. Divergent Trajectories under BNP and Sheikh Hasina

• During the BNP-Jamaat period (2001–06), bilateral ties were strained by security concerns, insurgency issues, and growing Chinese influence.
• Under Sheikh Hasina (2009–24), relations entered a “Golden Chapter” marked by enhanced security cooperation, the Land Boundary Agreement (2015), improved connectivity, and expanding trade.

5. Current Phase of Strategic Recalibration (2024–Present)

• Political changes following the 2024 uprising have created a trust deficit centred on migration, trade, water sharing, and geopolitical competition.
• Despite these challenges, both countries remain strategically interdependent, making cooperation essential for regional stability and prosperity.

Significance of Strong India-Bangladesh Relations

1. Strategic and Security Importance

• Bangladesh is India’s largest neighbour in Eastern South Asia and shares a border of over 4,000 km.
• Cooperation is crucial for managing border security, terrorism, extremism, illegal migration, and cross-border crime.
• Stability in Bangladesh directly impacts security in India’s Northeast.

2. Connectivity and Regional Integration

• Bangladesh serves as a gateway connecting mainland India with the Northeast.
• Vital for initiatives such as:
  • BBIN (Bangladesh-Bhutan-India-Nepal)
  • Act East Policy
  • Bay of Bengal regional connectivity projects

3. Economic and Trade Benefits

• Bangladesh is one of India’s largest trading partners in South Asia.
• Improved connectivity can boost trade, investment, logistics, and supply chain integration.

4. Water and Environmental Cooperation

• The two countries share 54 transboundary rivers.
• Cooperation on water sharing, flood management, and climate resilience is essential for sustainable development.

5. Geopolitical Significance

• Strong ties help maintain strategic balance in the Bay of Bengal region.
• Prevents excessive dependence of Bangladesh on external powers, particularly China.

Areas of Cooperation Between India and Bangladesh

1. Trade and Economic Cooperation

• Bangladesh remains India’s largest trading partner in South Asia.
• Bilateral trade stood at approximately USD 14.01 billion in FY 2023–24, with Indian exports worth USD 12.05 billion and Bangladeshi exports worth USD 1.97 billion.
• Bangladesh is also India’s largest export destination in the subcontinent.

2. Development Partnership

• India has extended over USD 8 billion through Lines of Credit (LoCs) to Bangladesh, making it India’s largest development partnership programme in the neighbourhood.
• These funds support railways, roads, ports, energy, and connectivity infrastructure.

3. Energy Cooperation

• Bangladesh currently has the capacity to import around 2,560 MW of electricity from India.
• In 2025, nearly 17% of Bangladesh’s electricity supply came from India, underlining deep energy interdependence.
• India exported around 2.4 GW of electricity daily to Bangladesh during 2025.
• Cross-border power trade continues despite periodic diplomatic tensions, highlighting the strategic nature of energy cooperation.

4. Connectivity Cooperation

Major connectivity initiatives include:

• Akhaura–Agartala Rail Link.
• Use of Chattogram and Mongla Ports by India for cargo movement.
• Revival of rail routes such as Haldibari–Chilahati and Petrapole–Benapole.
• Expansion of inland waterways under the Protocol on Inland Water Transit and Trade (PIWTT).
• Maitri Setu over the Feni River.

5. Regional Energy Connectivity

• In June 2025, Nepal began exporting 40 MW of electricity to Bangladesh through India’s transmission grid, demonstrating India’s emergence as a regional energy hub connecting South Asian economies.

Challenges in India-Bangladesh Relations

1. Trust Deficit Following Political Transition

• Bangladesh perceives India’s response to the new government as inadequate.
• Expected goodwill measures, such as restoration of visas and trade facilitation, have not materialised.

2. Illegal Immigration Issue

• Frequent references to illegal immigration in Indian political discourse create diplomatic sensitivities.
• Dhaka views such rhetoric as damaging to mutual trust and public perception.

3. Delay in Renewal of the Ganga Water Treaty

• The 1996 Ganga Water Treaty expires in December 2026.
• Delayed negotiations have generated concerns regarding water security and agricultural sustainability in Bangladesh.

4. Growing Chinese Influence

• Perceived stagnation in ties with India may push Bangladesh towards deeper engagement with China.
• Expanding Chinese investments and strategic presence could affect India’s regional interests.

5. Domestic Instability in Bangladesh

• Economic stress due to energy shortages.
• Public health concerns, including disease outbreaks.
• Law and order challenges and political polarisation.
• Such instability can complicate bilateral cooperation.

6. Lack of Progress on Trade and Mobility Issues

• Restrictions on market access and limited visa services continue to affect business, tourism, and people-to-people exchanges.

Way Forward

1. Restore Mutual Confidence

• Increase high-level political engagement and diplomatic dialogue.
• Avoid rhetoric that may be perceived as hostile by either side.

2. Fast-Track Renewal of the Ganga Water Treaty

• Begin structured negotiations well before the treaty’s expiry.
• Promote basin-wide and science-based water-sharing mechanisms.

3. Strengthen Economic Cooperation

• Restore trade facilitation measures and improve market access.
• Expand investment and connectivity projects.

4. Enhance People-to-People Relations

• Fully restore visa services, including business and medical visas.
• Promote academic, cultural, and tourism exchanges.

5. Deepen Regional Connectivity

• Accelerate BBIN and multimodal transport initiatives.
• Improve energy, digital, and logistics cooperation.

6. Adopt a Pragmatic Neighbourhood Policy

• Recognise that a stable and prosperous Bangladesh is in India’s long-term strategic interest.
• Focus on shared developmental goals rather than short-term political differences.

Conclusion

As South Asia undergoes rapid geopolitical and economic transformation, India and Bangladesh have the opportunity to transform their relationship from one of proximity to one of strategic partnership. Renewed trust and deeper cooperation can make the two countries key drivers of regional connectivity, security, and shared prosperity in the Bay of Bengal region.