As neighbours move on, India must recalibrate its foreign policy

India’s increasing isolation in its immediate neighbourhood is not a sudden development but the cumulative outcome of diplomatic complacency, strategic under-reaction, and a persistent failure to translate political intent into credible delivery. While New Delhi continues to project itself as South Asia’s natural leader, it has struggled to convert goodwill into lasting influence, allowing China to occupy the strategic space with speed, coherence, and purpose.

The erosion of India’s regional standing is therefore less about hostile neighbours and more about self-inflicted gaps in policy execution, follow-through, and political sensitivity.  The limitations of India’s ‘Neighbourhood First Policy’, conceived in 2008 and intensified post-2014, however, are not solely the result of external disruptions; they are rooted equally in structural and political shortcomings.

The contrast with China is stark and instructive. Through the ‘Belt and Road Initiative’, defence diplomacy, sustained political engagement, and aggressive narrative management, Beijing has woven deep economic and political dependencies across South Asia. India, by comparison, has relied on episodic outreach, delayed project implementation, and an assumption of automatic primacy rooted in geography and history. That assumption no longer holds. Smaller neighbours today act with sharper strategic agency, leveraging India-China rivalry to maximise benefits, and New Delhi has been slow to adapt to this new realism.

Donald Trump’s return to the White House has further complicated India’s neighbourhood calculus. His transactional foreign policy, marked by abrupt shifts, selective engagement, and a preference for short-term leverage, has unsettled regional equations. Renewed tactical engagement with Pakistan—driven by counterterrorism optics, Afghan spillovers, or episodic bargaining—undercuts India’s effort to diplomatically isolate Islamabad on terrorism. At the same time, Washington’s inconsistent signalling on China and reduced commitment to multilateral frameworks have encouraged South Asian states to hedge more aggressively. As U.S. posture oscillates, India’s leadership space narrows, forcing it to manage uncertainty generated far beyond the region.

These external pressures make an internal course correction unavoidable. The first requirement is sustained high-level political re-engagement. Visits by the Prime Minister and External Affairs Minister to Dhaka, Colombo, Kathmandu, Naypyidaw, and Malé must resume with intent rather than symbolism. India must also consciously abandon perceptions of partisanship in domestic political contests across the region and reaffirm a posture of principled neutrality, especially during elections and political transitions.

Second, long-pending deliverables must move beyond memorandum-level diplomacy. The Teesta water-sharing agreement, cross-border connectivity projects with Nepal and Bhutan, and infrastructure commitments in Myanmar require time-bound execution. India should also establish a South Asian Economic Assistance Corpus rooted in grants rather than loans to clearly differentiate itself from China’s debt-driven model and to restore confidence in Indian commitments.

Third, military diplomacy must be revitalised as an instrument of reassurance rather than dominance. Joint exercises, officer training programmes, intelligence sharing, and the supply of affordable defence hardware can help reassert India’s credentials as a dependable security partner, particularly for Sri Lanka, Bangladesh, and the Maldives. Fourth, the SAGAR initiative must acquire operational depth. By aligning with Quad partners, India can co-develop transparent infrastructure in ports, logistics, maritime surveillance, and undersea cables, offering credible alternatives to opaque Chinese projects.

Soft power remains India’s most underutilised asset. Scholarships, youth exchanges, cultural diplomacy, Bollywood, yoga, and cricket can reconnect India with civil societies and emerging political classes across South Asia. Equally critical is reclaiming narrative space. From FATF to BIMSTEC and BRICS+, India must lead coalitions while consistently exposing Pakistan’s terror infrastructure. A modern media strategy using local languages, regional digital platforms, and independent journalism support is essential to counter China-Pakistan propaganda in real time.

Missed opportunities underline the costs of drift. In Myanmar, India’s cautious disengagement after the 2021 coup weakened its leverage even as China and Russia moved swiftly. In Sri Lanka, early assistance during the 2022 economic crisis generated goodwill, but delayed infrastructure execution allowed China to reassert control over strategic assets such as Hambantota Port and Colombo Port City.

Bangladesh, once a close partner, is quietly recalibrating. The unresolved Teesta issue, perceived political alignment with the Awami League, and the fallout of CAA-NRC legislation have eroded bipartisan goodwill, while China continues its economic expansion. The Maldives reflects another avoidable setback, where delayed engagement enabled the “India Out” narrative and the withdrawal of Indian troops, emboldening Chinese ambitions in the Indian Ocean.

Nepal remains a diplomatic sore point. The legacy of the 2015 blockade, unresolved boundary disputes, and tone-deaf responses to internal political churn alienated public opinion, particularly among youth. Even Bhutan is cautiously diversifying its diplomatic options, signalling discomfort with India’s perceived paternalism. In Afghanistan, India’s complete withdrawal after the Taliban takeover erased years of soft-power investment, unlike China, Iran, and Russia, which retained engagement channels.

China’s encirclement strategy has thrived amid this inertia. Through BRI projects, arms supplies, and dual-use maritime facilities, Beijing has expanded its footprint across South Asia and the Indian Ocean. Its sharp power—media penetration, elite capture, and digital infrastructure—has steadily eroded India’s informational and cultural influence. In multilateral forums, China continues to block India’s ambitions while shielding Pakistan.

India’s setbacks are not irreversible, but they are instructive. The assumption of automatic leadership has been challenged by China’s methodical strategy and India’s uneven performance. Military deterrence without diplomatic consensus has clear limits. India must shed the illusion of primacy and become a dependable regional partner that listens, delivers, and shares prosperity. Only then will its neighbours stop hedging and begin embracing its leadership.

(The writer is a strategic affairs columnist and senior political analyst based in Shimla)