Old connections and new opportunitiesSecurity-centric view about borders must change as India grapples with market-related issues and opportunities
Borders-as-capillaries offer a broader and deeper meaning of borders and security. The re-opening of the once-versatile Nathu La trade route between Sikkim in India and the Tibet Autonomous Region of China after 44 years in 2006 has enabled a critical source of reconnection in the borderlands. After the agreement between Narendra Modi and Xi Jinping in September 2014, this route is now used for Kailash-Mansarovar pilgrimage. For decades, pilgrimage by Indians to Kailash-Mansarovar mainly took place either through the Nepal-China border town of Tatopani (Khasa) or by a difficult trek through the Sino-Indian pass from Taklakot on the Uttarakhand border.
The Nathu La route, which is one of the most magnificent eco-tourism routes, reduces physical hardship and the journey time. It makes deep inroads into biodiversity hotspots and offers a glimpse of glaciers and water towers. India has also decided to pave a two-lane highway up to Nathu La and a railway line to Rangpoo, while the Chinese government has decided to extend the railway line from Xigatshe to Nathu La.
Many expected China’s recognition of Indian sovereignty over Sikkim in 2003 to significantly alter India’s economic exchanges through the borderlands. The 2005 Nathu La Trade Study Team Report projected that trade flow from Nathu La would reach IRs4.46 billion by 2015.
But the trade between the two countries has not really taken off. Total trade increased from IRs1.97 million in 2007 to IRs170.1 million in 2014. Interestingly, in the absence of any significant growth in imports from China, three has been a huge trade surplus (IRs150 million) in India’s favour.
The dismal trade volume stems mostly from restrictions on tradable items, poor road conditions, inadequate and unattractive infrastructural facilities, limited tradable items, and policy-makers’ lukewarm attitude. However, it would be particularly naïve to expect traditional items like yak tail and goat skins to dominate the trade exchange. Even Tibet is no more a market for religious and cultural items alone. The region’s transforming market absorbs cement and cars to yarsagumba (caterpillar fungus) and tulips.
This will not be pragmatic to confine this route to interaction among the border communities. This was the assumption in the border trade between Nepal and Tibet at Khasa and India and Myanmar at Moreh (Manipur). However, the actual volume, composition and direction of trade in these routes have far surpassed the local communities and their products. Restrictions have only encouraged the illegal and surreptitious aspects of trade.
The Nathu La Trade Study Group recommended that during 2005-2010, construction of wider and deeper infrastructural facilities should take place to facilitate large-scale trading. By 2012, tourism should be integrated with trade and by 2015, Indian and Chinese tourists should be permitted to cross the border through Nathu La on a package tour basis. This route should also be used for the pilgrims going to Kailash Mansarovar from India. And during 2015-2018, neighbouring countries including Bangladesh, Bhutan and Nepal could begin to use this route. And 2018 onwards, Saarc tourism should be integrated through this route.
China has developed Renqinggang in Yatung county and India Sherathang as trade marts. Most of the scenic sites and tourist spots in Tibet are now open to domestic as well as international visitors. In fact, tourists are keen to observe how trade actually takes place between India and China at Sherathang and Renqinggang. The Nathu La pass has become a major tourist spot with the majority of 6 lakh Indian tourists visiting the border and enjoying the pleasure of shaking hands with Chinese soldiers.
A fascinating venture could be the cross-border Buddhist circuit. The entire Bangladesh-Bhutan-India-Nepal (BBIN) and Myanmar sub-region could be the hub connecting all the major Buddhist destinations in India and neighbouring countries—Bodh Gaya in Bihar, Rumtek in Sikkim, Tawang in Arunachal Pradesh, Lumbini in Nepal, Taktsang in Bhutan, Shwedagon Pagoda in Rangoon and Jokhang and Potala in Lhasa. Most of the Himalayan regions will benefit from this new intervention, enhanced by proposed air links between Bagdogra (Darjeeling), Sikkim and Guwahati with Rangoon, Kathmandu, Thimphu, Dhaka and other cities. Druk Airways of Bhutan is already flying between Bagdogra and Bangkok.
Also of interest to the people of Tibet and adjoining provinces like Sichuan will be the health and educational facilities available in the Sikkim-Darjeeling and the eastern belt of India, which boasts of fine educational institutions. However, to enhance the level of trading at Nathu La and other border points, the principles of trading must be based on the most favoured nation treatment (MFN) of World Trade Organisation, which will amount to drastically revising the list of exports and imports and announcing a negative list so as to match the market realities on both sides of the border.
Accordingly, the most modern trade facilitating measures, including customs, banking, warehousing, and insurance must be put in place along with the physical infrastructure. Besides, reorganising trading season form the present June to September to maximise the annual period and removing values of trading limit per trader per day have to be done with a strong regulatory mechanism that pertains to smuggling, environment, social interactions and other security parameters. A comprehensive policy intervention is required for promoting trade-investment-tourism-service sector linkages in the BBIN framework. In fact, the power hungry South West region of China could access electricity from the Bhutan-Nepal-North Eastern corridor of India.
A win-win situation
Moreover, a fast-developing India has started to change many of its traditional policies and strategies. Unlike in the past, Delhi now thinks of borders and frontiers in more comprehensive terms. This is more so in the context of India’s ‘Act East’ policy. The security-centric view about borders must change as a rising India grapples with issues and opportunities related to markets, resources, investments, services, and access to energy markets and tourism potentials. This is further speeded by the way the Chinese are building infrastructures alongside their borders, both with India and other neighbouring countries. The grand vision of ‘One Belt One Road’ initiative of China has already started becoming visible. Partly because of such developments, India has now decided to connect border areas, particularly in the hills and mountains, with highways, railway links, and green-field airports.
This will, on the one hand, help India to easily access its own border districts and communities. On the other hand, it will help neighbouring countries, including Nepal, Bangladesh, Bhutan and Myanmar, to access Indian markets and through them the markets of neighbouring countries. The likelihood of deeper regionalism has increased in South Asia due to an increased willingness on India’s part to work with Bangladesh, Bhutan, Myanmar and Nepal on aspects that are regional rather than purely bilateral. This has been topped by an increased capacity to implement projects, such as through state, private, and non-governmental capacity.
Lama, who served as the chief economic adviser of the government of Sikkim (2000-2007), headed the team of experts to prepare the Nathu La Trade Report in 2005