In the new year, India appears all set to carry forward its foreign policy objectives, such as Neighbourhood First, Act East and Think West, with all its seriousness, while giving prominence to its relationship with the US and Europe for technology and Africa and Latin America in the true spirit of ‘Vishwa Bandhu.’
 
But in the complex international scenario, India’s main challenge remains in navigating through the tension that dots Indo-Pacific, Middle East and Eastern Europe. Despite this, New Delhi’s concern lies in keeping the country’s momentum of growth on as it nurses an ambition to become a developed economy by 2047. To fulfill it, India will have to work hard in almost all areas, including the external policy front.
 
'Neighbourhood First' approach  
 
In this regard, India will continue to prioritise its relations with countries in its immediate neighbourhood for stability and prosperity. For example, Nepal under the Communist government headed by K P Oli is disposed to China, but India has not given up in creating mutually beneficial, people-oriented regional frameworks envisaging building physical, digital and people-to-people connectivity with the Himalayan country.
 
Recently, India along with Nepal and Bangladesh launched a trilateral power transaction. It involves flow of power from the Himalayan country to Bangladesh through the Indian grid. Then being a priority partner under its Neighbourhood First policy, India continues to offer assistance for Nepal’s development related to infrastructure, capacity building, health, education, and culture. Defence cooperation has received a boost with India offering much needed help to the Nepal Army in the areas of capacity building, equipment, and joint military exercise.
 
In fact, except for Pakistan because of its unending support to cross-border terrorism, India has laid focus on strengthening relationships with all neighbours. It could be seen in the case of the Maldives where president Mohamed Muizzu swept to power on the ‘India Out’ campaign in November 2023 and made China the first destination of his foreign visit in January 2024. He allowed Chinese research vessel Xiang Yang Hong 03 to dock twice in the Maldivian waters on February 22 and April 25 last year and forced New Delhi to withdraw 80 Indian defence personnel from the island country. However, in the new year, the first foreign dignitary to be received by India was Maldivian foreign minister Abdulla Khaleel who landed here on January 2 on a three-day visit, signalling clearly that ‘India First’ has once again gained a salience in the Maldivian foreign policy.
 
For this, experts give credit to India’s policy makers as they maintained strategic patience in the face of provocations from the Maldivian government and invited Muizzu during the swearing-in ceremony of prime minister Modi and his cabinet in June 2024. The rest is history. Today, India has become a “valued partner” for the Maldives with Muizzu profusely expressing gratitude to the Indian government for offering a bailout package to help avert a debt crisis.
 
Another positive development could be seen in the case of India’s relations with Sri Lanka. Its Left-leaning president Anura Kumar Dissanayake followed the island nation’s past presidents while choosing India for his first overseas visit. After decisively winning the recent presidential election in Sri Lanka, Dissanayake visited India during December 15-17.
 
It was an extremely substantive visit during which India announced granting $20.66 million to settle the payments related to seven completed line-of-credit projects in Sri Lanka. Till date, India has extended grants and Lines of Credit worth $5 billion to the island nation demonstrating that India attaches the highest importance to its closest neighbour and the important maritime nation in the Indian Ocean.
 
India’s relations with Bhutan continue to grow from strength to strength and this would be seen in the context of King Jigme Khesar Namgyel Wangchuck’s three official visits in the past 20 months – not counting the one in the last week to participate in the funeral of former PM Manmohan Singh. No Bhutanese king has landed in India so frequently.
 
But Bangladesh will remain a headache as an unfriendly interim government headed by Nobel laureate Muhammad Yunus is sitting in Dhaka. Last month, on the sidelines of a conference in Cairo, Muhammad Yunus met Pakistani PM Shehbaz Sharif and both agreed to deepen bilateral cooperation in all areas of mutual interest.
 
'DW', a German media outlet, recently reported that Pakistan will begin training the Bangladesh Army in February 2025. It further said that Bangladesh will also reportedly join Pakistan in the ‘Aman 2025’ joint naval exercise at Karachi Port. If it remains true, it is going to pose a major security threat to India even across the Indian Ocean through which oil supplies flow from the Strait of Hormuz to the Strait of Malacca and beyond. China is said to be involved in this game.
 
India’s Gulf strategy
 
PM Modi’s recent visit to Kuwait is seen in the context of India’s long-term strategy towards securing uninterrupted supply of oil and gas from the Gulf region. On December 21, Modi became the first Indian PM to land in Kuwait in 43 years after Indira Gandhi’s trip in 1981. It broadly hinted about India’s bid to solidify its engagement with the region.
 
In the past one decade, Modi has made 15 state-level and official-level trips to the Gulf countries, starting with the UAE in August 2015. Such high-level visits to the region will continue in the new year as they help in fostering closer relations between the two sides, especially when India, being one of the world’s largest and fastest-growing markets, looks at the Gulf countries as the cornerstone of its energy supply.
 
According to a recent report by the International Energy Agency (IEA), India is set to lead global oil demand growth until 2035. India will add nearly 2 million barrels per day(mb/d) to global oil demand during this period, the IEA report said.
 
As per data from OPEC, Saudi Arabia, the UAE, and Kuwait have 38.8% of the world’s total oil reserves, while proven gas reserves in the Gulf countries are around 58 trillion cubic metres. The GCC countries presently contribute 35% of India’s oil imports and 70% of gas imports.
 
Besides energy, India wants an increase in trade and investment with the Gulf countries for the development of infrastructure and boosting job creation opportunities. In terms of trade and commerce, the Gulf countries are India’s second most important trade destination after the US. During 2023-24, India-GCC bilateral trade stood at $161.59 billion.
 
On the investment front, the UAE continues to be the largest Gulf investor in India with it investing $19 billion between April 2000 and June 2024. The India-UAE Investment Treaty, which entered into force on August 31, 2024, will further strengthen two-way investment flows. Over 70% of all GCC investments come from the UAE.
 
ASEAN Centrality
 
India shares close historical bonds with ASEAN countries, and under its ‘Act East’ policy, it has increased its engagement with them. In the new year, Indonesian president Prabowo Subianto’s proposed visit to New Delhi as the chief guest at the Republic Day functions, demonstrates India’s bid to expand its reach in the region, which also aligns with the latter’s strategy for the Indo-Pacific.
 
Both India’s Indo-Pacific strategy and ASEAN’s Outlook on the Indo-Pacific (AOIP) support a free, open, and rule-based order, freedom of navigation and overflight, shared prosperity, and inclusivity.
 
India has reinforced its maritime security collaboration with ASEAN through joint exercises, capacity-building initiatives, and agreements to combat piracy. Along with this, rise in defence cooperation between India and countries like the Philippines, Vietnam, Malaysia and Indonesia, has given momentum to deep security and strategic alignments between New Delhi and the ASEAN countries.
 
After the Philippines’ purchase of $375 million worth of naval-version of BrahMos missiles from India, Jakarta is engaged in advanced discussion with New Delhi over the acquisition of BrahMos supersonic cruise missile system.
 
According to media reports, the deal is likely to be finalised during the Indonesian president’s proposed visit to India. Similarly, Vietnam is planning to ink a $700 million deal with India for BrahMos missiles, while Malaysia has also shown interest in the India-Russia built missile system.
 
Earlier, India provided training to Vietnamese armed forces operating Sukhoi SU-30 fighter jets and Kilo-class attack submarines. Amid China’s assertive behaviour in the South China Sea, these developments demonstrate India’s increasing role to emerge as a security and strategic player in the ASEAN region.  
 
Chinese checkers
 
Distrust will continue to hound India’s relations with China. Last week, Beijing announced establishing He’an County and Hekang County in its Hotan Prefecture incorporating territory that belongs to Ladakh.
 
This expansionist move took place close on the heels of India’s NSA Ajit Doval and China’s foreign minister Wang Yi who is also a member of the Political Bureau of the Communist Party of China held 23rd Special Representative level talks in Beijing on December 18.
 
For New Delhi, not just the establishment of new counties by China in the Indian territory is a cause of concern, it is equally alarmed by Beijing’s decision to build a mega dam on the Brahmaputra in Tibet. There is a fear that the dam will adversely impact the ecological balance of Arunachal Pradesh and Assam as the river passes through these two states.
 
On the border front too, Beijing has though carried out troops’ disengagement at Depsang and Demchok in the Eastern Ladakh, but, as per the latest Pentagon report, this is a limited disengagement exercise as People’s Liberation Army has not scaled back its troops number since the June 2020 clash.
 
China has still maintained approximately 120,000 troops along the 3,400 km LAC. The report has highlighted that more than 20 combined arms brigades remain in forward locations across Western, Middle, and Eastern sectors of the LAC, the Pentagon report said. These developments have raised doubts about China’s commitment to improve relations with India.  
 
Focus on West
 
India’s relations with the US under the Joe Biden administration remained vexed on the matter-related to Khalistani separatists and repeated interference in the internal affairs of the country. US NSA Jake Sullivan’s visit to India on January 6, ahead of handing over reign of power to the administration led by Donald Trump, was aimed at smoothing rough edges that have developed between the two countries under president Biden.
 
But then, overall bilateral engagements between the two countries on trade, investment, technology, security, and defence have been smooth. It is felt that under the incoming Trump administration, India’s engagement with the US will gain a new momentum in major areas like technology, space, defence, and security.  
 
India’s ties with Canada under prime minister Justin Trudeau may not improve in the immediate future. India has accused Canada of acting as a safe haven for Khalistani terrorists and sympathisers. However, with Europe, India will lay focus on deepening its ties for trade, investment, and technology. India and the 27-member European Union which relaunched negotiations for a Free Trade Agreement in 2022 after a gap of nine-year, is expected to give a further push towards early conclusion of negotiations for the FTA in 2025.
 
Consolidation of India-Russia ties  
 
The most consequential relationship in 2025 will be between India and Russia. President Putin’s proposed visit to New Delhi in the first quarter of the new year for the annual summit with Modi is likely to inject a fresh energy in the trusted partnership of the two countries.
 
If Putin embarks on his visit to India, it will be his first trip to New Delhi after Russia’s invasion of Ukraine in February 2022. Therefore, the likely visit of the Russian president will be the most watched development in the world in 2025.
 
Nonetheless, whether it is supply of energy or high-tech transfer or serving each other’s strategic interests, Russia has been a highly accommodating partner of India in the world. Russia is one of the five permanent UNSC members, which has consistently backed New Delhi for the Security Council membership.
 
Conclusion
 
Overall, for India, the year 2025 will prove to be both promising as well as challenging. It will host the Quad Leader’s summit and also India-EU summit. Along with this, however, it has to be seen whether Modi travels to China to attend SCO summit or not, given that huge trust deficit continues to persist in the relations of the two countries. With Japan, South Korea, Africa, Latin America and countries of the Pacific region, India will prefer having engagements that serve both long- and short-term interests in the areas of technology, mines and minerals, agriculture, and health.