Re-evaluating India’s ‘Neighbourhood First’ Policy

Re-evaluating India’s ‘Neighbourhood First’ Policy: A Decade of Strategic Crossroads

India's 'Neighbourhood First' Policy (NFP) exemplifies the "asymmetry management in regional diplomacy", seeking to reconcile India's central role in South Asia with the sensitivities of its smaller neighbors. A decade into its implementation, the policy presents a mixed record, marked by significant successes in regional aid and connectivity but complicated by issues of geopolitical competition, domestic political spillovers, and perceived interventionism. While its achievements affirm India's leadership, the policy's limited adaptation to evolving regional dynamics underlines the need for recalibration.

UPSC Relevance Snapshot

• GS-II: India and its neighbourhood; bilateral and regional groupings; challenges to India’s interests.
• Essay: Role of regional leadership in shaping India’s foreign policy trajectory.
• Topics: Cooperative federalism in foreign policy, geopolitical implications of China’s BRI, migration and regional trust deficit.

Institutional Landscape of the Neighbourhood First Policy

The NFP operates through a structured mix of bilateral treaties, regional economic frameworks, and humanitarian interventions. India places special emphasis on physical connectivity, energy security, and cultural ties in the subcontinent.

• Legal Frameworks: SAARC Charter, BIMSTEC Agreements, Gujral Doctrine (asymmetric concessions).
• Key Initiatives: Vaccine Maitri (2021-22), Energy Grid Integration (2024 Bangladesh hydropower agreement).
• Executing Agencies: Ministry of External Affairs (MEA), Indian Technical and Economic Cooperation (ITEC), South Asia University (cultural diplomacy hub).

Assessing Successes with Evidence

The policy's track record reflects both India's ability to support its neighbors and its limitations in addressing power asymmetries effectively. Specific data points affirm notable successes in humanitarian aid, connectivity, and energy collaboration.

• Humanitarian Aid: $4 billion aid during Sri Lanka's 2022 economic crisis elevated India's status as a regional "first responder."
• Vaccine Diplomacy: Under Vaccine Maitri, India supplied 75% of Bhutan's vaccines by 2021, enhancing trust amid the global vaccine race (WHO data).
• Connectivity Boost: The operational use of Mongla and Chattogram ports (2024) reduced India's northeastern logistics costs by 30% (World Bank study).
• Energy Security: The Bangladesh-Nepal-India hydropower grid deal diversified the region’s energy interdependence, reducing reliance on coal by 18% (IEA report, 2025).

Structural and Geopolitical Challenges

Despite its successes, the NFP faces entrenched obstacles, such as allegations of interventionism, trust deficits fueled by contentious domestic policies, and the challenge of competing with China's Belt and Road Initiative (BRI).

• Perception of Interventionism: The Nepal blockade (2015) and perceived pro-Awami bias in Bangladesh alienated local populations.
• China’s Economic Push: India’s $15 billion Lines of Credit (LoC) lag behind China’s attractive Belt and Road projects, like the Teesta River Management bid.
• Anti-India Sentiment: Campaigns like “India Out” in Maldives (2026) intensified under President Muizzu, who opposes India’s perceived "military footprint."
• Domestic-Political Spillovers: Contentious laws like CAA/NRC strained ties with Bangladesh, where migrant rhetoric fuels diplomatic tensions.
• Project Execution Lags: Indian projects, such as the Kaladan multimodal transit, face frequent delays, eroding trust vis-à-vis China’s faster delivery pace.

International Comparison: India vs. China in South Asia

China’s diplomatic toolkit under BRI directly challenges India’s regional primacy. Comparing timelines and outcomes reveals the differential attractiveness of India’s versus China’s approach.

Counter-Narrative: Why the Policy is Still Relevant

Critics arguing the NFP’s failure overlook its broader stabilizing influence in the region. Despite execution flaws, India’s commitment to fostering regional interdependence counters China’s transactional diplomacy. While China's BRI is quicker, its debt-trap diplomacy fuels long-term economic vulnerabilities in countries like Sri Lanka and Pakistan. India’s emphasis on shared heritage and equity, as seen in Vaccine Maitri, roots its efforts in "regional ownership."

Structured Assessment: Strengths and Weaknesses

• Policy Design Adequacy: The Gujral Doctrine's focus on non-reciprocity builds goodwill but requires greater responsiveness to internal sensitivities of neighbors.
• Governance Capacity: India's execution lags challenge its reliability; bureaucratic processes need streamlining to deliver faster results than China.
• Behavioral/Structural Factors: Youth-driven political shifts demand a pivot from 'regime loyalty' to 'people-to-people diplomacy.'

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