IDR Blog
Revisiting India-Myanmar Relations and the Way Forward
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India-Myanmar relation is deeply rooted in history. India was one of the leading proponents of Burmese independence and established diplomatic relations immediately after Burma’s independence from Great Britain in 1948. For many years, Indo-Burmese relations were on a firm footing due to cultural links, flourishing commerce, mutuality of interests in regional affairs and the presence of a vibrant Indian community in Burma. The Indo-Myanmar relations from 1948 to 1952 could be considered as friendly and cordial when Myanmar became independent, with good rapport between Prime Minister Nehru and Prime leader U Nu, and like India, Myanmar was a member of the non-aligned movement. The relationship turned frosty from 1962 to 1988 under General Ne Win, as Burma chose a policy of isolationalism, expelled ethnic Indians, refused to be in the Commonwealth of Nations and withdrew from NAM. Since 1988 till today, primarily due to India adopting a more realistic and pragmatic policy toward Burma, the relationship has overall been on the upswing.
However, India- Myanmar relations once again deteriorated in 1995, when New Delhi conferred the Jawaharlal Nehru Award for promoting international understanding on Aung San Suu Kyi, the high profile Burmese dissenting leader. To keep the momentum high, the India- Myanmar foreign secretary meeting was held in Yangon in August 2000. The two countries agreed to strengthen the infrastructure and step up border security to promote border trade. The two countries signed a protocol to establish regular bilateral ministerial consultations and agreed to cooperate in projects related to infrastructure development, energy supply and information technology.
India and Myanmar are leading members of the Bay of Bengal Initiatives for Multi Sectoral Technical and Economic Cooperation (BIMSTEC) with Myanmar being the lead country for energy sector. Since its inception in 2000, the Mekong–Ganga Cooperation, along with other member countries such as Vietnam, Laos, Cambodia and Thailand, Myanmar assists India in nurturing and expanding its influence and ties amongst Southeast Asian nations in various ways. The Forum on Regional Economic Cooperation among Bangladesh-China-India-Myanmar (BCIM) has provided scope for increased regional integration among India’s neighbors toward greater economic prosperity.
Relations between India and Myanmar have been growing during the past few years with cooperation in all sectors, particularly in those of trade and commerce. Myanmar’s economy is primarily agricultural, with agricultural activity employing nearly two thirds of the population and contributing about 45 percent of total GDP. The main export commodities comprise agricultural, marine and forest products, and minerals and gems. Myanmar imports mainly consumer goods and raw materials and capital goods for industrial use.
India is the largest market for Myanmar’s exports. India is Myanmar’s 4th largest trading partner after Thailand, China and Singapore, and second largest export market after Thailand, absorbing 25 percent of its total exports. India is also the seventh most important source of Myanmar’s imports. The Indian government has air, land and sea routes to strengthen extensive trade links with Myanmar and establish a gas pipeline. While the involvement of India’s private sector has been minimal, both governments are proceeding to enhance cooperation in agriculture, telecommunications, information technology, steel, oil, natural gas, hydrocarbons and food processing. The bilateral border trade agreement of 1994 provides for border trade to be carried out from three designated border points in India’s north-eastern region, one each in Manipur, Mizoram and Nagaland.
On February 13, 2001, India and Burma inaugurated a major 160 kilometer highway, called the Indo-Myanmar Friendship Road, built mainly by the Indian Army‘s Border Roads Organisation and aimed at providing a major strategic and commercial transport route connecting South Asia and Southeast Asia. It was termed as a significant event in view of India and Myanmar sharing a 1643 kilometer long common border along India’s four states- Manipur, Mizoram, Nagaland and Arunachal Pradesh. The strategic importance of Myanmar in the Indian Ocean and adjoining littoral states has made India initiate active naval cooperation with Myanmar. In recent times, India and Myanmar naval cooperation is growing and forging ahead.
In terms of trade relations, India’s imports from Myanmar are primarily agricultural and forest based products (especially beans and pulses) and main exports to Myanmar are primary and semi finished steel and pharmaceuticals. The balance of trade is heavily in favour of Myanmar.
The first Border Trade Agreement was signed in Delhi in January 1994 and was implemented in April 1995 with the opening of a cross border point between Moreh (Manipur, India) and Tamu (Sagaing Division, Myanmar). Subsequently, both governments had agreed to open four check posts which will help in checking the border trade and making it official, curb the illegal trade of goods and monitor the activities of various insurgent groups between India and Myanmar.
Myanmar is being increasingly viewd as gateway to India’s ‘Look East’ policy. India is making all concerted efforts to strengthen its relationship with Myanmar to achieve its stated objective. Indo-Myanmar relationship as a result is witnessing an unprecedented upswing in the recent years.
India is engaged in several river and land-based projects in Myanmar. The India-Myanmar gas pipeline project is another area where India is deeply involved in Myanmar. India recently signed three important agreements with Myanmar; exploration of natural gas, satellite-based remote sensing and promotion of Buddhist studies in Myanmar. New Delhi is also looking for joint cooperation with Myanmar in IT, automobile, textiles, and agro-based industries.
Lack of memorandums of understanding between the designated banks on both sides, restriction imposed on exports as well as on items in barter trade, and cross-border insurgency are being cited as major obstacles in two-way trade. Right now only 22 items are allowed to be exported and imported under the free trade agreement signed between India and Myanmar. They include mustard seeds, pulses and beans, fresh vegetables, fruits and soyabean. On the other hand, India exports textiles, shoes, medicines, woolens and engineering goods to Myanmar. These items have significant consumer demand in Myanmar.
Major issues of concern to both countries are cross border insurgency, narcotics trade, border posts, border fencing border trade and. On cross border militancy, while India faces insurgency problems in its north eastern states of Nagaland, Manipur and parts of Mizoram across the Myanmar borders, Myanmar too faces insurgency from Naga (Khaplang group) from the Indian side. In this regard, both the armies have agreed to strengthen the mechanism to exchange intelligence along the international border to check cross border crimes.
India and Myanmar are considering a series of initiatives for expansion of border trade between the two countries. Indian has given its approval for the signing of a proposed agreement with Myanmar for the avoidance of double taxation and prevention of fiscal evasion with respect to Income taxes.
There are three key factors that are compelling India to develop a proactive relation with Myanmar. First, the ‘Look East Policy’ is to reach out to the broader ASEAN group; second, a coordinated effort is being made with Myanmar to develop its northeast region that has been neglected over the decades and; third, India is evolving a strategic policy for managing Chinese influence over Myanmar. Under India’s Look East Policy, the trilateral highway between India, Myanmar and Thailand plays a major role to reach out to the South East Asian countries such as Malaysia and Singapore. So is the Trans Asian railway that is being planned to connect New Delhi with Hanoi in Vietnam. A deep economic relationship with Myanmar in India’s view would give a tremendous boost to the development of its northeast region. The planned infrastructure development of road, rail and waterways are all steps in this direction.
Apart from bilateral relations, India is also engaging Myanmar through ASEAN and BIMSTEC. India’s engagement with Myanmar through ASEAN began in 1997, when it was admitted as its full dialogue partner and in the same year Myanmar became its full member. The Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) set up in 1997 and one on which Modi government has put a lot of emphasis is another important forum through which India is actively engaged with Myanmar. Fearful of sanctions from European Union and the United States, Myanmar wants to develop close relations with India for economic reasons. India is one of Myanmar’s major trading partners and fourth largest market for its goods. Bilateral trade between India and Myanmar has grown nearly eight-fold in recent years. Bilateral trade has been growing steadily reaching USD 1571.95 million in 2014-15 (Exports to Myanmar USD 773.74 million and Imports from Myanmar USD 1016.86 million). India’s policy of engagement with Myanmar has furthered India’s foreign policy objectives in a significant way. India has responded promptly and effectively to assist Myanmar in humanitarian relief operations following natural calamities like Cyclone Nargis in 2008, the earthquake in Shan State in 2010 and cyclone Komen in 2015. It expected that relations between the two countries will continue to improve during 2017 and beyond in spite of regional and sub-regional developments.
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