Thursday, July 17, 2025

India’s Neighbourhood Diplomacy Reboots: Maldives & Nepal in Focus

 

India’s Neighbourhood Diplomacy Reboots: Maldives & Nepal in Focus

By Suryavanshi IAS

“India’s foreign policy begins at home — in the neighbourhood.”
— Jawaharlal Nehru

India’s diplomatic calendar is set to heat up in July 2025 as Prime Minister Narendra Modi will visit the Maldives for their 60th Independence Day (July 25–26), while efforts are underway to host Nepal’s Prime Minister K.P. Sharma Oli soon after.

These visits are critical for India’s “Neighbourhood First” policy, rebalancing ties with two nations that have seen recent political shifts and strategic recalibrations.


📌 Key Takeaways from the Visits

🇲🇻 India–Maldives Relations

  • PM Modi to attend Maldives' 60th Independence Day Parade on July 26, 2025.

  • Bilateral talks with President Mohamed Muizzu to strengthen:

    • Digital diplomacy: Expansion of UPI in Maldives.

    • Tourism and people-to-people ties.

    • Debt relief: India extended a currency swap facility and increased Lines of Credit to ₹600 crore (FY 2025–26).

🔥 Background Tensions

  • “India Out” campaign backed by President Muizzu during his 2023 campaign.

  • “Boycott Maldives” trend in India following derogatory remarks about PM Modi.

  • The impasse was defused when India replaced its military presence with civilian technicians.

🇳🇵 India–Nepal Relations

  • PM Oli's upcoming visit gains importance as:

    • He visited China first, skipping India after taking oath in July 2024.

    • He expressed strong support after the terrorist attack in Pahalgam, Kashmir.

    • India aided Nepali nationals during the Iran-Israel conflict evacuation.


🧾 Important Terms & Concepts for UPSC

TermMeaning
Neighbourhood First PolicyIndia's foreign policy doctrine emphasizing deeper engagement with immediate neighbours.
Line of Credit (LoC)A concessional loan offered by India to support infrastructure and development in friendly nations.
Currency SwapAn agreement between two countries to exchange currencies, providing liquidity and stabilizing foreign reserves.
UPI (Unified Payments Interface)India's digital payment platform; now being exported as a tool of soft power.
India Out CampaignA political movement in Maldives opposing Indian military presence and influence.

🧠 UPSC Previous Year Questions (Relevant)

GS Paper II

  • 2019: “In the light of recent controversies regarding the use of Electronic Voting Machines (EVM), what are the challenges before the Election Commission of India to ensure the trustworthiness of elections in India?”
    (Useful to show institutional trust — parallels can be drawn with India's neighbourhood image.)

  • 2013: Discuss the impact of India’s ‘Look East’ policy on India-ASEAN relations.
    (Relate to India’s evolving Neighbourhood First & SAGAR policies.)

GS Paper II (Expected Type)

Q. “India’s neighbourhood diplomacy in the post-COVID era is being increasingly shaped by digital outreach and crisis-response mechanisms.” Critically examine with reference to Maldives and Nepal.


📊 India–Neighbourhood Diplomacy: Current Dynamics

CountryCurrent StatusKey IssuesIndia’s Response
MaldivesThaw after tensionsMilitary presence, digital cooperationReplaced military, offered digital tools and credit
NepalRenewed outreach expectedChina tilt, PM visit pendingDiplomatic effort, regional evacuations, bilateral aid

Strategic Importance for India

1. Maritime Security and SAGAR Vision

  • Maldives is a strategic player in Indian Ocean Region (IOR).

  • India’s Security and Growth for All in the Region (SAGAR) policy positions Maldives as a core partner.

2. China Factor

  • Both Maldives and Nepal have strong engagements with China (Belt and Road Initiative).

  • Ensuring balanced influence through developmental diplomacy is key for India.

3. People-to-People Diplomacy

  • Diaspora, tourism, education, digital payment systems like UPI increase India’s soft power appeal.


📝 Model Mains Question for Practice

Q. India’s relations with Maldives and Nepal reflect both the opportunities and complexities of neighbourhood diplomacy. Discuss with recent developments.


🧭 Conclusion: Diplomacy by Dialogue

India’s foreign policy, particularly in the neighbourhood, must balance strategic concerns, developmental support, and people-centric outreach. The visits to Malé and Delhi are more than just ceremonial; they are symbolic of India’s recalibrated approach — one that blends digital diplomacy, disaster responsiveness, and respect for sovereignty.

“Neighbourhood diplomacy succeeds not when India dominates the region, but when India empowers it.”

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