India in Wait-and-watch Mode as Yunus Takes Charge in Bangladesh

“Neighborhoods for any country, especially big countries, will never be easy. Neighborhoods need hard work,” said Indian Foreign Minister S. Jaishankar at a public event in New Delhi on August 2.

Jaishankar’s comments were prescient as three days later, the Bangladeshi government under Prime Minister Sheikh Hasina collapsed under pressure from mass protests. For India, which has tense relations with Pakistan and China and is warily watching the civil war in Myanmar, its neighborhood has now become a whole lot tougher to deal with.

New Delhi had assiduously cultivated friendly ties with Hasina and her Awami League since she came to power in 2009. The move to foster better ties with Bangladesh started with former Indian Prime Minister Manmohan Singh. Prime Minister Narendra Modi stayed the course when he came to office in 2014 and built on it, taking the relationship to new highs, so much so that it resulted in this phase of bilateral ties being referred to as “Sonali Adhyay” or “Golden Period” in Bangladesh-India relations.

All that crumbled with the fall of the Hasina government on August 5 on the back of a student-led protest against reservations in government jobs, fueled by high inflation and lack of employment opportunities — consequences of floundering economic growth in a post-COVID-19 era.

So, what next for Bangladesh-India ties? For now, New Delhi is in wait-and-watch mode.

What is a given, however, is that India will have to rework its Bangladesh strategy on the back of the political changes there for several reasons.

An interim government headed by respected economist Muhammad Yunus is in place now in Bangladesh. One of its top priorities is to restore law and order, especially in the context of ransacking, arson, and violence against minorities (Hindus, besides Christians and Buddhists). Almost simultaneously, it will need to steady the economy. And somewhere in the future, it will have to oversee the organization of elections.

As India contemplates its next steps vis-à-vis its eastern neighbor, one of the things it can do immediately is offer to help stabilize the Bangladesh economy. Indian High Commissioner to Dhaka Pranay Verma was among those who attended Yunus’ swearing-in. According to Indian media reports, Modi is expected to meet Yunus when the two attend the regional Bay of Bengal (BIMSTEC) countries summit in Thailand in early September. This would be a good platform for India to offer an economic helping hand to Bangladesh.

Bangladesh is India’s biggest trade partner in South Asia and India is the second biggest trade partner of Bangladesh in Asia, according to Ministry of External Affairs data. India is Bangladesh’s largest export destination in Asia, with approximately $2 billion worth of Bangladesh exports going to India in FY 2022-23. In FY 2022-23, the total bilateral trade was $15.9 billion.

Besides this, Bangladesh is also the largest beneficiary of India’s Lines of Credit (LoC) under India’s development partnership assistance program. Since 2010, India has extended Bangladesh four LoCs valued at around $8 billion for infrastructure – roads, railways, shipping, and ports. India has also been providing grant assistance to Bangladesh for projects including dredging of inland waterways in Bangladesh.

Wishing Yunus well on his appointment as chief of the interim government, Modi wrote in a post on X, formerly Twitter, that India is keen to see “the early return to normalcy, ensuring the safety and protection of Hindus and all other minority communities.”

Several attacks on Hindus, who comprise 8 percent of Bangladesh’s population and are seen to be supporters of the Awami League, have been reported in Bangladesh since Hasina’s resignation. The safety of Hindus in Bangladesh is important to India for domestic reasons. While raising the issue of protection of minorities, New Delhi would need to be careful that it is not seen as interfering with its advice and counsel for the early restoration of order. With almost all countries in its neighborhood fearing its size and power, India would need to exercise patience and avoid being seen as publicly pressuring the new Bangladesh government to secure its minorities.

In the past, New Delhi has eschewed what it termed as “megaphone diplomacy” while dealing with Myanmar’s junta. For instance, New Delhi said that it had conveyed its reservations over the detention of freedom icon Aung San Suu Kyi prior to 2010 in private conversations with the military. With Bangladesh too, New Delhi could employ this method, especially given the delicate situation there. If it does, India’s counsel will be better received in Dhaka, more so at a time when Sheikh Hasina is in India.

India’s connections with Hasina and the Awami League are historical and rooted in its support for Sheikh Mujibur Rahman and the Awami League in Bangladesh’s 1971 Liberation War. In 1975, when Rahman and many of his family members were assassinated, his daughters, Hasina and Rehana, received sanctuary in India. Hasina lived for six years in India before returning home in 1981.

These connections paid rich dividends in terms of warm India-Bangladesh ties over the past 15 years. But today India’s association with Hasina – she has been in India since fleeing Dhaka on August 5 – could prove a liability.

In an interview with an Indian television channel, Yunus said Hasina’s presence in India may not be a good idea, indicating that this could be a red line for Dhaka. The opposition Bangladesh Nationalist Party (BNP) too has expressed disapproval of Hasina being sheltered in India.

It is unclear how long Hasina intends to stay in India. “As far as former Prime Minister Sheikh Hasina is concerned… we don't have an update on her plans. It is for her to take things forward,” Indian foreign ministry spokesman Randhir Jaiswal said last week.

But things are not entirely in Hasina’s hands. The BNP has asked India to extradite the former prime minister back to Bangladesh to face charges of murder and abduction linked to the crackdown on student protests. As of this writing, the interim government has yet to formally make such a request, but should it do so India would face a difficult dilemma.

Complicating matters, Hasina’s son Sajeeb Wazed Joy has said that she will return to Dhaka to participate in polls whenever an election is held. This contradicts his earlier remarks that Hasina, 76, intended to retire from politics at the end of her current five-year term, which began in January 2024.

Public ire against Hasina is running at an all-time high in Bangladesh. Angry mobs vandalized and desecrated statues and memorials dedicated to her father, “Banglabandhu” Sheikh Mujibur Rehman, considered the father of the nation in Bangladesh. It appears from the ferocity of the recent protests that any election held soon in Bangladesh will go against Hasina and her Awami League.

Some sections say that the protest movement has been infiltrated by the radical Jamaat-e-Islami, which is behind the vandalism and desecration. That even the Bangladeshi Army, opposition parties, and the students themselves haven’t been able to stop the Jamaat indicates significant public support for the Jamaat and the groundswell of fury against Hasina and her father’s legacy.

Therefore, being seen as associated with Hasina is not in India’s interest. It will likely widen the trust deficit between New Delhi and Dhaka in the near term at least.

This in turn could be advantageous for strategic rivals like China, allowing them to deepen their influence in Bangladesh – something that New Delhi would want to avoid at all costs.

New Delhi could, of course, bank on the fact that it has worked to “proof the relationship against political ups and downs” as articulated by Jaishankar. India has done this by funding and implementing development projects that have directly impacted the Bangladeshi people.

But to reach out to the Bangladeshi people, India will need to work with the government in Bangladesh. And this is where India could face problems as it neglected the engagement of parties like the BNP.

While some sources told The Diplomat that India has few contacts with the opposition, as it had focused almost exclusively on building ties with Hasina and the Awami League, others pointed out that the BNP had reached out to people close to the Modi government in New Delhi, indicating possible contacts at the political and diplomatic levels too.

However, rarely has the Indian government publicly acknowledged contacts with the Bangladeshi opposition. One instance dates back to 2015 when Modi met with BNP leader Khaleda Zia in Dhaka.

Importantly, India has maintained contact with the armed forces of Bangladesh. Last year, then-Indian Army Chief Manoj Pande met his Bangladeshi counterpart during an official visit. Indian ships of late make regular port calls in Bangladesh.

While these are good starting points for a new chapter in ties, India will need to put in more work to set its relationship with the new dispensation in Dhaka on a firm footing.

There is of course the case of the Maldives to follow as an example. After Mohamed Muizzu was elected president last year on an “India Out” platform, New Delhi saw its influence squeezed as the Maldivian president reached out to China to balance India. The relationship has now steadied, with Jaishankar concluding a successful visit in August.

Quiet diplomacy together with the exercise of strategic patience paid out in the case of the Maldives. There is no reason why it can’t work in the case of Bangladesh too.