India, a rising global power and a key player in international organizations such as the G20, BRICS, and QUAD, faces a paradoxical challenge in its immediate neighborhood.

 Despite its global ascent, the country is steadily losing friends and gaining adversaries in South Asia. This shift underscores the widening gap between India’s global ambitions and its regional relationships, with significant implications for its geopolitical strategy.

A Deteriorating Neighborhood Policy

In 2014, Prime Minister Narendra Modi unveiled the “Neighbourhood First” policy, signaling India’s intent to play a leading role in South Asia. However, the policy has largely failed to yield results, with neighboring countries increasingly gravitating toward alternative alliances, particularly with China. The irony lies in India’s diminishing influence in a region where it should have been the natural leader.

The case of the Maldives is illustrative. Mohamed Muizzu, who ran a successful campaign centered on the “India Out” platform, was elected president in 2023. A staunch pro-China leader, Muizzu wasted no time in issuing an ultimatum for the withdrawal of Indian troops. India complied, but the diplomatic retreat symbolized more than a military withdrawal—it signaled a loss of leverage. Despite ongoing visits by Maldivian officials to India, Delhi has been unable to counter the growing pro-China tilt of Muizzu’s government. Former President Mohamed Nasheed, a key pro-India figure, has been sidelined, leaving the Maldives firmly in Beijing’s orbit.

Losing Ground Elsewhere

Afghanistan presents a similar story of retreat. During former President Ashraf Ghani’s tenure, India had a significant presence in the country. The Taliban’s return to power, however, has erased much of India’s influence. Similarly, Nepal, once a close ally, has drifted away due to missteps by New Delhi. A critical turning point came in 2015 when India imposed a blockade over Nepal’s new constitution, causing widespread economic hardship in the landlocked nation. The fallout pushed Kathmandu closer to China, leading to a series of trade and infrastructure agreements that have deepened China’s foothold.

Sri Lanka’s relationship with India has also grown increasingly complex. While New Delhi provided $4 billion in economic assistance during Sri Lanka’s financial crisis in 2022, China’s influence continues to overshadow India’s efforts. Large-scale infrastructure projects like the Hambantota Port and Colombo Port City, funded by Beijing, have entrenched Chinese interests. The long-standing Katchatheevu Island dispute, a recurring flashpoint during Indian election cycles, adds another layer of tension. Sri Lanka has firmly rejected any fresh discussions on the matter, further complicating ties.

Bangladesh: A Fraying Partnership

India’s relationship with Bangladesh, a vital neighbor, is also under strain. Historically supportive of the Awami League and former Prime Minister Sheikh Hasina, India’s perceived partisan stance has drawn criticism. Hasina’s decision to seek refuge in New Delhi amid political turmoil revealed vulnerabilities in the bilateral relationship. Indian commentators have warned that Delhi’s approach of “putting all eggs in one basket” is risky, as it alienates the broader Bangladeshi population.

Recent rhetoric around alleged Hindu persecution in Bangladesh has only exacerbated tensions. Politicians like Suvendu Adhikari have leveraged the issue to stoke regional politics, while Indian economic measures have restricted Bangladeshi exports. According to the Observatory of Economic Complexity, India exported $1.38 billion worth of goods to Bangladesh in 2022, compared to $200 million in imports. A deterioration in relations would jeopardize this favorable trade imbalance, a reality that Delhi cannot afford to overlook.

The Shadow of China

China’s growing influence looms large over South Asia, creating a challenging environment for India. Smaller nations like the Maldives and Nepal are increasingly balancing their relationships between the two powers, complicating India’s efforts to reassert itself. The 2023 Maldivian presidential election, which pitted pro-India Mohamed Solih against pro-China Mohamed Muizzu, epitomized this geopolitical competition. Muizzu’s victory was described by Michael Kugelman, director of South Asia initiatives at the Wilson Center, as a “major win for Beijing.”

India’s predicament is further highlighted by its declining influence in Bhutan and Myanmar. Bhutan, traditionally a close ally, is gradually moving toward Beijing’s orbit. Meanwhile, insurgent groups in India’s northeastern states, often supported by Myanmar, pose additional security challenges.

Regional and Global Implications

India’s diminishing influence in South Asia has broader geopolitical implications. As Western powers reduce their presence in the region, China has strategically expanded its economic, military, and technological reach. This shift extends beyond South Asia to the Middle East, where Beijing has deepened ties with countries like Qatar, Saudi Arabia, Turkey, and the UAE.

India’s inability to counter China’s growing clout in South Asia reflects a broader challenge: how to reconcile its global aspirations with its regional responsibilities. C. Raja Mohan, in his article “Is India Losing South Asia? That’s Not the Question,” argues that India has the capacity to safeguard its interests but must abandon outdated assumptions. He emphasizes that China’s rapid economic and military expansion should be a wake-up call for Delhi.
The Case for Regional Cooperation

Amid these challenges, calls for reviving SAARC have gained momentum. Professor Muhammad Yunus, head of Bangladesh’s interim government, has advocated for transforming South Asia into a cooperative bloc similar to the European Union. While the idea holds promise, it would require India to adopt a more conciliatory and inclusive approach, prioritizing collective regional interests over unilateral actions.

India’s strategic missteps, coupled with China’s aggressive diplomacy, have created a volatile environment in South Asia. To regain its footing, India must recalibrate its policies, rebuild trust with its neighbors, and leverage its economic and geopolitical strengths to counterbalance Beijing’s influence. The stakes are high, and the window for action is narrowing.