PM’s India visit: Focus on energy cooperation

Enhancing energy cooperation to address the challenges posed by high fuel and commodity prices in the wake of the Ukraine war will top the agenda when Prime Minister Sheikh Hasina visits India on September 5-8.

Diplomatic sources in Dhaka and Delhi said the two countries may finalise a long-term agreement on the import of fuel oil from India, which is buying huge Russian crude oil at a discounted price.

Bangladesh made a record hike in the prices of fuel last month, leading to a further rise in the costs of essentials -- which created unease in the Awami League government gearing up for the national election likely next year.

"India is in a better position on the fuel issue. So, we will try to go for a long-term deal with them if they have a surplus," Foreign Secretary Masud Bin Momen told reporters at his office on August 29.

Hasina will visit New Delhi at the invitation of her counterpart Narendra Modi, who came to Dhaka last year to join the celebrations marking the golden jubilee of Bangladesh's independence and diplomatic ties between the two countries.

Analysts say her visit will provide a framework for multi-dimensional relations after the two countries resolved major disputes over land and maritime boundaries.

"The state-level visit will be crucial given the global economic and geopolitical changes. Dhaka will definitely want Delhi to help stabilise the economy, especially the supply of energy and essentials," said former foreign secretary Shahidul Haque, now Bangabandhu Chair at the University of Delhi.

According to the schedule, Hasina will reach New Delhi on September 5 evening. The bilateral meeting between the two prime ministers will be held on September 6. The same day, she will also make a courtesy call on Indian President Droupadi Murmu.

On September 7, Hasina will address a meeting with top business leaders, and visit Ajmer Sharif Dargah in Rajasthan before returning to Dhaka on September 8.

The officials concerned say they are finalising details of the visit when about a dozen MoUs might be signed with energy, trade, economy, energy, connectivity, water sharing, security and defence getting high importance.

PUTTING SUPPLY CHAINS RIGHT

Apart from the long-term agreement on importing fuel oil from India to Bangladesh, Dhaka and Delhi will discuss ways of ensuring an unhampered supply of foodstuff like wheat, onion, pulses and spices to Bangladesh.

Earlier, Bangladesh had considered buying Russian crude oil, but that was not possible as it didn't have the technology to refine the Russian crude oil.

Foreign ministry officials said the top leaders may also discuss using Indian rupees for trade between the two countries as both the countries saw a decline in foreign currency reserves, with Bangladesh approaching the World Bank and IMF for loans.

Shahidul Haque said global and regional politics has changed in the aftermath of Covid pandemic and the Russia-Ukraine war. With the rising rivalry between the West and Russia and China, the two blocs are trying to draw countries on their sides.

He said India is already a member of the Quad, a diplomatic network of four countries committed to supporting a free and open Indo-Pacific, and US-led Indo-Pacific Economic Framework (IPEF).

Bangladesh is still not a member of Quad or IPEF but it has joined China's Belt and Road Initiative (BRI).

"There is a clear gap between the stances of Bangladesh and India," he said, adding that the leaders would surely try to reduce the gap.

In South Asia, where Afghanistan, Pakistan and Sri Lanka are in trouble, India and Bangladesh want to work together for regional stability, which is also related to regional security, Shahidul Haque added.

TRADE AND CONNECTIVITY

India-Bangladesh bilateral trade was worth over $14 billion last year, with Bangladesh exporting products worth close to $2 billion. Officials and experts say this volume can be increased manifold with the right infrastructure and regulations in place.

Dhaka will call upon New Delhi to withdraw the anti-dumping duty imposed on exports of jute products from Bangladesh to India since 2017. The anti-dumping duty is a protectionist tariff on imports of goods that are priced below fair market value.

New Delhi will also be requested to remove any other non-tariff barriers as part of Dhaka's objective to increase exports.

As the duty-free regime under the South Asian Free Trade Agreement will expire once Bangladesh graduates out of LDC status by 2026, the two countries have already conducted a joint study on the Comprehensive Economic Partnership Agreement (CEPA).

Hasina and Modi may give a go-ahead to start the negotiation on CEPA, the future framework of trade and investment.

Bangladesh has provided India with transit and transhipment facilities for transporting Indian goods to the northeast. New Delhi may stress the need for speeding up the rail, road and waterway connectivity projects and lowering the cost of trade by improving logistics and transportation.

At a recent event, Indian High Commissioner Vikram Doraiswami said major trade between the two countries is done through one land port, which creates a monopoly and raises the cost of trade.

Also, there is no direct shipping between India and Bangladesh, and the goods that have to go by sea are shipped via Port Klang of Malaysia, Singapore or Colombo, which increases transport cost and time.

Bangladesh is also keen on regional connectivity through the implementation of Bangladesh, Bhutan, India, Nepal (BBIN) Motor Vehicle Agreement and regional hydroelectricity grid with India's northeast, Nepal and Bhutan.

Shahidul Haque said Dhaka and Delhi should expedite the implementation of both bilateral and sub-regional connectivity projects.

India has a massive plan for implementing its Look East Policy and Bangladesh is a big part of it because of its geographical position.

Bangladesh can also be heavily benefited by increasing its export to the northeast of India and charging fees for the vehicles that carry Indian goods through Bangladesh's land or waters, he said.

WATER SHARING

The Joint Rivers Commission meeting held on August 25, after a gap of 12 years, has raised new hope of progress in the water issues between the countries. In the meeting, Dhaka and Delhi finalised the text of the MoU on Interim Water Sharing of Kushiyara river. It may be signed during the visit.

The Teesta water-sharing deal has been pending since 2011 when it could not be signed due to last-minute opposition from West Bengal Chief Minister Mamata Banerjee.

Apart from the Muhuri, Dharla, Khowai, Monu, Dudhkumar, and Gumti rivers, eight others have been included by India for water sharing.

Dhaka will request New Delhi to expedite the process as millions of people in the northern region of Bangladesh suffer due to a shortage of irrigation water in the dry season, and are affected due to floods in the monsoon, foreign ministry officials said.

PROGRESS IN DEFENCE COOPERATION

Traditionally, Bangladesh buys most of its military equipment from China. India, which wants Bangladesh to buy defence equipment from them, signed an agreement of $500 Indian Line of Credit (LoC) for this in 2017, but Bangladesh has yet to utilise it.

According to diplomatic sources, Bangladesh's Armed Forces Division (AFD) prepared a list of equipment, which it wants to import from India, following the defence dialogue held in New Delhi on August 11.

A delegation of defence experts will visit India soon to finalise the list.

The procurement of defence equipment is being considered significant progress in defence cooperation between India and Bangladesh, the sources said.

BORDER MANAGEMENT

Border management has always been a critical issue, especially with Dhaka repeatedly requesting New Delhi to stop border killings.

The number of such killings has decreased in recent times, but New Delhi has stressed the need for comprehensive management of the border and checking criminal activities. Hasina and Modi may provide further direction towards this end.

Diplomatic sources said Dhaka was unhappy about India's National Register of Citizens and Citizens' Amendment Act. New Delhi maintains that these have no implications in Bangladesh.

Dhaka also was unhappy about anti-Muslim rhetoric by some top BJP leaders. On the other hand, New Delhi is unhappy about violence against the Hindu community, especially during the last Durga Puja.

Shahidul Haque said during the PM-level meeting, Dhaka and Delhi would share their concerns like religious radicalisation as these have wider implications across the borders, and call for stopping nationalistic and populist remarks.

According to Indian High Commissioner Vikram Doraiswami, the bilateral relations between Bangladesh and India have reached such a level that all issues are on the table for discussion and can be amicably resolved.