21 India-Central Asia Relations

Dr. Ashok Attri

Structure of the Module

1. Introduction

2. Objectives

3. Historical Evolution

4. The Importance of Central Asia to India

5. Bilateral Relations

6. Conclusion

7. Important Questions

8. Suggested Readings

1. Introduction

The demise of erstwhile Soviet Union and the end of the Cold War led to the collapse of bipolar world and related military power blocks and rise in the forces of regionalism, integration and neo-functional organizations. Economic and technological issues have moved to the forefront of international relations. All these developments, consequently, brought about a change in the forces shaping world politics and international relationship. These events have also ripped the foundation from beneath Indian foreign policy. Given the growing trend towards regional groupings and integration, India is engaging its its immediate and extended neighborhood for consolidation of its ties with them.

Central Asia has emerged as an area of priority for India’s foreign policy in this period.

After the demise of erstwhile Soviet Union, five independent Central Asian states, Kazakistan, Kyrgyzstan, Tajikisatan, Turkmenistan and Uzbkistan appeared as nation-states on the common space as one region ‘Central Asia’.

The region serves not only as a historical buffer zone between Asia and Europe but also as a convenient transit route connecting other major regions. Its location alone is a good indicator of its political and strategic significance. Due to its strategic location, demographic composition and availability of oil and mineral wealth, this region has become vital for global politics in general and India in particular.

2. Objectives

For India, the ‘Central Asia’ has always remained an area of high priority due to historical, political, cultural, geographical and economic reasons. The new emerging trends in this region are going to provide prospects and problems as well for India. India has privilege of enjoying goodwill with these states due to long historical linkages. Through this module an effort will be made to apprise the students about the real nature of India’s relations with Central Asia. This region is to be considered next hotbed for power struggle in the 21st century. India as an immediate neighbor could not remain mere spectator in this scenario. It could not take risk to ignore this region in its policy orientation. Therefore, it becomes imperative to understand and evaluate the historical perspective about the origin of their relationship. By doing so, one can analyze the real nature of India’s relations with the countries of Central Asia. This will not only prove beneficial for the students, but foreign policy architects and strategists could also use basic clues in policy formulation.

3. Historical Evolution

India and Central Asia have great civilization contacts in history. These relations predate the arrival of the Turkic tribes from Central Asia and older than the Islamic conquest of the region. Some scholars also emphasized on ‘Aryans and ‘Vedas’ linkages between the two. ‘Kushan period’ and ‘Silk Route’ connection has been a landmark in the historical relations between India and Central Asia. The gentle human spirit of Buddhism held sway over the entire region. Besides, the Khiljis, the Tughlaks, the Lodhis, the Suris and the Mughals were all related to this region in one way or other. After independence, India’s relations with this region remained fruitful and cordial. Indian top leadership always made it a point to visit these Republics. Indian culture and films enjoyed considerable popularity in this region during Soviet regime.

With the emergence of Central Asian Republics as sovereign states after the demise of erstwhile USSR, India has been the first port of call for the top Central Asian leadership in their visits abroad. India top leaders also reciprocated these visits by mutually rewarding visits. Hence, any analysis of the new geopolitical significance of Central Asia and its implication for India must take into consideration not only the current developments but also the historical linkages these countries have with India.

4. The Importance of Central Asia to India

Due to its strategic location, demographic composition and availability of oil and mineral wealth, Central Asia has become vital for global politics in general and India in particular. In order to examine the real nature of India’s policy towards this region, it is equally essential to understand the defining features of this region.

The Central Asian Republics (CARs) have the enormous hydrocarbon reserves between 90 to 200 billion barrels of oil and 46 percent of the known world gas reserves. Kazakistan alone possesses a quarter of world’s known uranium resources. Uzbekistan treasures the largest goldmine on earth. Turkmenistan is the fourth major natural gas producer of the world. However, these deposits can be made useable with the support and cooperation of other states. The CARs are trying to diversify their economies and are engaged in new partnerships to enhance economic cooperation. Simultaneously, India’s energy demand is rising rapidly with economic growth. It is making efforts to look for reliable long-term sources of energy to boost its economy. Thus, Central Asia has the potential to emerge as an important long term energy provider to India. Besides, underdeveloped economy and weak socio-economic infrastructure of these countries offer rich opportunities to technically-skilled local force and natural resources to Indian entrepreneurs desirous of setting up joint ventures in Central Asia. All these economic trends compel India for positive engagement with this region.

The geographical location, mineral and oil wealth and rise of Islamic fundamentalism make CARs an important area from strategic point of view. Russia, China, Afghanistan and Iran border Central Asia, and it lies a few miles from the Pakistani and Indian borders. This become crucial as it is surrounded by the likely regional powers of the next century, four of which are declared nuclear weapon states. This scenario combined with economic wealth has made this region an area of power politics. Any change in the geopolitical balance in Central Asia is likely to have grave consequences for the strategic balance in South Asia. Besides, other related issues like terrorism, drug-trafficking, security, regional grouping, oil and energy needs, defense interactions, etc. may also determine India’s strategic Interests in this region.

The demographic composition of Central Asia is of plural character, where people of different languages, nationalities and ethnicity live to form a composite culture. In view of the poly-ethnic composition and artificially drawn states borders in these republics have the possibilities of inter-ethnic tensions and conflicts. Besides, Islam constitutes the major belief of the majority of people, the disappearance of Soviet ideology has left a vacuum in the beliefs and value system leaving search for an alternative ideology in this region. There persists a danger of the emergence of fundamentalist activities. This has the direct bearings for India’s security.

Pakistan has always occupied a central place in India’s foreign policy. The fluid situation in Central Asia offers opportunities to the Pakistan to enhance its anti-India programme relying on Islamic fraternity. It has supported Islamic revivalism in this area whole-heartedly. This is a matter of deep concern for India’s policy makers.

Hence, due to economic alignment, strategic scenario and fragile political setup, this region is considered as a very significant area by the outside powers including India. It makes imperative for India to look towards this area with more seriousness due to its geo-economic and geo-strategic implication for India.

5. Bilateral Relations

India’s policy with this region, which took a distinctive shape since the early 1990s, has been a multi-pronged approach encompassing political, economic and strategic aspects. A brief description of these initiatives is herewith:

5.1. Economic Relations

The dynamics and strength of bilateral ties are bound to grow, given the historical and significant interest, India has evinced in this region. The CARs hold a positive opinion about India’s economic development. They all look to India for industrial and technical assistance. India has identified a number of sectors in which it has considerable strength for cooperation. These are: automobile industry, textiles, hotels, banking and insurance, drug and pharmaceuticals etc. Joint ventures of India and these states were envisaged in these areas. Mutual cooperation and joint ventures were also envisaged in the areas of railway, science and technology, construction, tourism, health ecology, trade and commerce. India has also offered facilities for training of Central Asian journalists, diplomats and students through Indian Technical and Economic Cooperation (ITEC) programme.

India had also signed the treaty on ‘principle of inter state cooperation’ and ‘Bilateral Investment Promotion and Protection Agreement’ (BIPA) with each of these republics for trade promotion. They also have established Joint Commission to promote economic and technological linkages. Trade relations between India and these states of Central Asia are governed by these agreements. It contains normal features of trade agreements, such as mutual Most Favored Nation treatment (MFN), promotion of economic, industrial, scientific and technical cooperation. Commerce and Industry Ministry of India has launched a ‘Focus CIS Programme’ at the time of announcement of its EXIM Policy in March 2003. Under this programme, the government of India extends assistance to exporters, EPCs, business chambers, etc. to visit these countries, organized trade fairs, invite trade delegations to visit India and undertake various other market promotional activities.

India offered a moderate financial assistance to all five republics in the initial period. India offered $10 million credit to Kazakistan for capital goods, $5 million to Kyrgyzstan for joint ventures, $10 million to Tajikistan for economic activities and $5 million to mitigate drought like situation, $15 million to Turkmenistan and $30 million to Uzbekistan till 2000. India also supplied medicines worth of $10 million and machinery worth of $0.5 million to Turkmenistan and $75,000 to Uzbekistan for computerization of three Post Offices.

The level of investment is quite modest between India and Central Asian Republics. A number of Indian companies like state owned Indian Oil Company ONGC Videsh Ltd., Ispat Karmat, Larsen and Toubro, Phoenix, Aska International, Tirupti Overseas, Climate Export-Import, Birla Technical, Anjali International etc. are already doing good business in Central Asian Republics. They have their operations in these states and increasing their market share every year through opening of their offices, agencies, and appointing permanent agents. Indian Oil Company ONGC Videsh Ltd. already has a 15 and 10 percent holding respectively in Kazakistan’s Alibekmola and Kurmangazi field, Ispat Karmat has invested US$ 800 million in steel industry in Kazakistan. Phoenix, Aska International, Tirupti Overseas, Climate Export-Import, Birla Technical, Anjali International etc. among other companies of private sector has invested in Kyrgyzstan.

Joint ventures were envisaged in the railway, science and technology, construction, tourism, health and trade and commerce. In pharmaceutical industry, Kazakhstanapharama, M/s Kyrgyz Ajanta in Bishek, Ajanta Pharma Turkmenderman in Ashkabad, Surkhan-Ajanta Pharma Ltd., Core Pharmsanoat Ltd., Gufic-Avicenna Ltd., Reddy Pharmed Ltd., Rusan Pharma Ltd. are the main Joint Ventures established in this region.

East Butterfly for the manufacture of stainless steel and Premier Explosives Limited-M/s Navoiazot for manufacture of industrial explosives and detonators, Maharaja Appliances Ltd. for making washing machine are other Joint Ventures established in this region. Punj Lloyd Kazakistan Ltd. for construction of large and small bore pipelines, Sharp Power & Communication Equipment-OJSC Kainar for lead-acid batteries and Rakesh& Associates-Ayul for manufacture of concrete and other construction material are the latest Joint Venture established in these states of Central Asia.

In construction sector, M/s Tata Projects Ltd. and M/s Larson and Toubro completed the construction of hotles in Tashkent, Samarkand and Bukhara. Telecommunications Consultants India Limited (TCIL) and Department of Post of Uzbekistan are jointly implementing the two pilot projects in Tashkent for cooperation in mail transmission, EMS, and other related items.

Despite the high economic potential, the scale of trade between India and CARs has been quit modest in the early phase. It has displaced dynamism in recent years. Joint Commissions are established and mutual trade fairs and exhibitions are held for the growth of bilateral trade.

India and all Central Asian Countries have established Join Commission to promote economic and technological linkages. The first session of Indo-Kazak joint commission was held in Delhi in July 1993. The fifth session was held in Astana in 2005. Agreements were made for smooth transfer of technology and enriched uranium pallets used as fuel in atomic reactor to India. The other areas of bilateral agreements were mining, hydrocarbon, solar energy and oil and gas exploration in these meetings. Indo-Tajik Joint Commission was established in 2001, its first meeting was held in Delhi in the same years. The second session was held at Dushanbe in 2005. While Indo-Uzbek Joint Commission, Indo-Turkmen Join Commission were set-up in 1993 and 1995 respectively. With Kyrgyzstan also, Indo-Kyrgyz Joint Business Council was established in 2000 to enhance cooperation among business communities.

The confederation of Indian Industries (CII) has been regularly organizing ‘Enterprise India’ exhibitions in the capitals of all the Republics to serve as a platform for the Indian Small and Medium Enterprises (SMEs) there. Besides, ‘Made in India’ trade shows and fairs were also organized in various cities by CII.

India’s trade with this region as a whole has grown significantly if the figures since 2004 are taken into account. India’s trade with the states of Central Asia stands around 1,02,935 lakh rupees as in 2004-2005, it accounts a growth of around 24.47 percent in comparison to the trade of 93,110.34 lakh rupees in the year 2003-2004. There has been an increase in both Indian exports and imports in this year. Indian exports increased to 75,991.29 lakh rupees from last year’s exports of 69, 769.92 lakh rupees and import of 26,984.10 lakh rupees from 23, 340.42 lakh rupees in 2004-2005. In the year of 2013-2014, India’s trade showed further growth as it reached at the total of Rs. 7,52,234 lakhs, with export of Rs. 3,25,585 lakhs and import of Rs. 4,26,649 lakhs. In the year of 2014-2015, India’s trade showed more growth, as it reached at the total of Rs. 8,41,875 lakhs, with the export of Rs.3,69,565 and import of Rs. 4,72,310 lakhs. On the whole, the level of trade has been much below from their potential. The entire Indian export to these countries is less then 2 percent of its total exports. The imports also follow a similar picture and account for only 1.5 percent of the Indian imports on the average basis. Though India-CARs bilateral trade may be small in volume, yet it has been growing steadily over the years and holds potential for further growth and diversification.

India and these countries also aware of the importance of vast natural resources available in these states, because this wealth is attracting attention of entire world as energy security are going to be fundamental and inevitable requirement for the contemporary world. India is the sixth largest consumer of energy in the world and to sustain its economic growth, it needs a vast amount of energy. Central Asian states possess large reserves of oil and natural gas and are looking for alternative markets where they can get suitable price for their raw materials. Therefore, India and these countries can be of great help to each other. Convergence on these interests would bring together the main producers and consumers of oil in Asia.

In this respect, both India and Central Asian Republics are making serious efforts to create the right kind of atmosphere for collaboration in this field. They have decided that cooperation in the hydrocarbon sector would involve not only exploration but also investments for up gradation and moderation of existing infrastructure facilities such as refineries and pipelines as well as training programme. After that, state owned Indian Oil Company ONGC Videsh Ltd. had invested in various projects of oil production in this region, despite facing tough competition from other stakeholders.

But the real problem is lying with the issue of connectivity with this region, as India has no direct border with this landlocked region. Besides the bilateral efforts, both are taking keen interest in opening their options by linking themselves to other regional countries. Iran, Russia and Afghanistan have emerged as the potential ally in this respect. North-South transport agreement among India, Iran and Russia in September 2000, and earlier through a tripartite transport agreement among India, Iran and Turkmenistan in 1995 is such steps in this direction. The signing of a trilateral agreement between India, Iran and Afghanistan is another important step in this direction. Revival of ancient ‘Silk Route’ is the other notion that looms large time to time for the linkages to this region.

Lying down of oil and gas pipelines are another way to get connected to this region. The proposed Turkmenistan-Pakistan-Afghanistan-India gas pipeline project has assumed new significance to get access in this oil field. The Governments of major stakeholders including India are taking keen interest in the construction of oil and gas pipelines for easy transportation of these reserves. Once the problem of connectivity gets resolved, economic relations between India and Central Asian region will take a new turn for the benefit of both.

5.2. Strategic Relations

The region of Central Asia emerged as an important area of strategic concern for India in post-Cost War period. India stepped up its diplomatic efforts towards stability and security of this region. The major issues that determine India’s strategic interest in CARs are herewith:

The new scenario of ‘sphere of influence’ to secure energy resources has made Central Asia strategically significant in post-cold war period. The growing international competition for influence in this region causes a security concern for India as well as Central Asia itself. CARs wish to become partners of these external powers to the extent that it suits their respective national interests, along with their survival and autonomy in international relations. India enjoyed better position in Central Asia due to its track record in its external relations. India never followed any unscrupulous designs in its foreign relations. It is keen to develop healthy relations based on positive engagement and mutual understanding. Interests of both, thus, converge in terms of their beliefs of defense, security and stability in this area.

The combination of religious fundamentalism, nationalist separatism and international terrorism pose the greatest threat to the security and stability of this region further more. There is considerable similarity in the nature, source, pattern and methodology of these problems as both India and CARs share two sides of the hotbed of international terrorism, i.e. the states of Pakistan and Afghanistan. So, they face a common threat from cross-border terrorism from Islamic extremists abetted by neighboring countries. In this regard, convergence between India and Central Asia may emerge on this issue. Leaders of both India and these states have expressed their common resolve that Afghanistan may not be allowed to be used as safe haven for terrorism. They are of the view that further efforts are needed for the long-term establishment of a broad-based multi-ethnic and independent government in Afghanistan.

Besides, lucrative drug trade of opium in this region also poses a major threat to stability in this region. The terrorist groups, particularly in Afghanistan, regard the drug production and sales as the most appropriate mean to earn money to purchase armaments. Fergana Valley in Uzbekistan is becoming the distribution centre of drugs from where the latter are re-distributed and redirected along several routes to Russia and to Western world. It is considered to be an easy source to finance the growth of terrorism and religious fundamentalism in the Indian state of Jammu and Kashmir. New Delhi is worried about the flow of arms and narcotics from this war-torn area into Kashmir. On this issue as well as on the issue of jointly combating the cross-border terrorism, there is a compatibility of interests between the two. That is why; India has signed agreements on joint working groups against terrorism with all the Central Asian Republics. It is sharing its experience regarding counter-terrorist activities, intelligence expertise and giving training to their military personnel.

In fact, the problems related to Central Asia are not only being addressed at the bilateral level but also in various regional forms like CIS collective security and Shanghai Five. Besides, CICA summit and Bishek conference is the landmark in bringing the concerned state together in collectively countering these problems with the shared goodwill of likeminded countries. The emergence of these regional formus is the positive process in Asian continent. India fully supported all these initiatives and recently joined the much talked Shanghi Five as full member. Only thing that raised some serious questions in Indian as well as Central Asian perspectives is of China’s dubious postulate in regional grouping.

At bilateral level also, India signed defense deals with most of the republics. India rebuilt an air base camp at ‘Ayani’ in Tajikistan near Afghanistan border and could, therefore, be used for energy security interests and for operations against terrorism in this region. India also signed a deal with Kazakistan for smooth delivery of uranium for energy sector recently. It also purchased Iiysuhin 76 military transport plane and helicopter from Kazakistan. India and these countries also agreed to cooperate in the areas of joint exercises, military training, jungle warfare and research and development of the thermal torpedoes for the navies.

5.3. Political Relations

India is following a policy of consistent engagement with CARs with its inception. These states also have reciprocated Indian gesture in positive manner. India seemed to have developed warm niches for itself in the minds of policy makers of these states. Reciprocal visits, shared demographic beliefs and values, convergence on the issue of ‘new world order’ and cultural initiatives highlights this cordial relationship between India and CARs. A clear idea of political interaction between the two can be manifested by discussing these issues.

A large number of exchanges at various levels of delegates-governmental, private, commercial- have been undertaken between India and Central Asian Republics to explore the possibilities of mutual grounds for enhancing cooperation. Top leaders of both India and Central Asia have visited each other at regular intervals. The Uzbek President Islam visited India in 1991, 1994, 2000 and 2005 regularly. The Kazak President Nursultan Nazarbaev visits took place in the years of 1992, 1996 and 2002. Turkmen President Saparmured Niyazov visited India thrice in the years of 1991, 1992 and 1997. Presidents of Kyrgyzstan and Tajikistan also visited India regularly. Kyrgyz President Askar Akave also visited thrice in the years of 1992, 1999 and 2002, while Tajik President Emomali Rakhmonov’s visits took place in the years of 1995, 1999 and 2002.

Indian top leaderships also have made goodwill gesture by visiting CARs regularly. Prime Minister PV Narshimo Rao visited Uzbekistan, Kazakistan in the year of 1993 and Kyrgyzstan and Turkmenistan in the year of 1995. Prime Minister Manmohan Singh paid the state visit to Uzbekistan in 2006. Prime Minister Atal Bihari Vajapayee visited Kazakistan in 2002 and Tajikistan in 2003. Prime Minister Narendra Modi’s visit to all five Republic in 2015 is considered as one of the remarkable step taken by India towards strengthening ties with this region. Besides, a large number of top ministers and bureaucrats also visited to each other country in these years. During these visits talks on a wide range of issue of mutual interest and international significance were held.

The region of Central Asia constitutes a composite culture, cohering as a distinct entity by ethnic, linguistic and religious affinities. The predominantly Muslim population of all the states has drastically changed the political scenario of this region. The ethnic orientation of these republics is further marked by sub-division within the main groups themselves. Similarly, India is a plural society where Muslim population also forms an important component of its population. Any disturbance in demographic composition has direct spillover impact on Indian system. It will have serious implications for India’s policies in future as well. India is baffled by the development in this area.

In this context, the sharing of demographic beliefs and values amongst them may provide a binding framework to these diverse manifestations. The best course for such societies is an open, liberal, secular and demographic political system. India, to a large extent, has succeeded in establishing and experimenting with such a system. The Central Asian leadership, at present, seems to be committed to establish such a political system and India can play a positive role in helping them by offering training facilities to acquaint them with a functioning democracy in a developing society. Thus, they are working for such a countering mechanism that encourages ethnic, religious and linguistic discord to be resolved among different sections of people. Both are of the view that only democratization in these states can resolve their problems. Consequently, both are vocal supporter of secular ethos, which is fundamental for the growth of democratic culture in these states. This convergence consolidates political relations further more.

Both India and CARs share similar views on the most of the questions dealing with the dynamics of emerging ‘new world order’. Such questions include the world stability, regional and global integration of countries and also welfare and prosperity of the people. They are of the view that emerging new order has to be based on democratic principles and cooperation among all the members of international community. Political interaction between India and these countries of Central Asia has been regular and mutually supportive in UN and other international organizations on various issues.

On the issue of democratization of UN, both India and Central Asian Republics agree to the expansion of the Security Council to make it more representative and efficient. All these countries, noting the role being played by India in the world affairs, support India as an appropriate candidate as a permanent member of restructured UN Security Council.

India is following a pro-activist policy of cultural interactions with these Republics. Indian cultural centers are also established in most of these countries. Indian Council for Cultural Relations is also providing 30 full scholarships to the students from Central Asia. ‘Festival of Central Asia’ was also organized in major cities of India in these years. Apart from events at these centers, as well as activities including reciprocal ‘days of culture’, scholarly exchanges have also been taken in the form of frequent visits, seminars etc. In addition, one slot for learning Hindi in India is also allotted to the students of these states. Potential of tourism is highly noticed in mutual interaction of India and these states; this will not only provide profit but also help in building up the people to people contact.

6. Conclusion

India’s relations with Central Asian Republics have developed in a unique and specific way. The success achieved during the past years in the growth of bilateral cooperation is ample proof of it. There is unending scope to derive multifarious benefits via a two-way union with this region. The dynamics of this relationship was, however, influenced by some common problems and constraints. Lack of direct transportation system, modest progress made both in liberalization and privatization, inadequacy of information about business opportunities and inadequate banking facilities in these countries are some of the major problems which hinder the existing relations. India’s basic thrust towards this region should be one of positive engagements as the relaxation of tension in the post-cold war era is likely to provide more opportunity for strengthening of bilateral ties in a constructive manner. India should favorably respond to initiatives of these states to evolve any regional formation for the sake of economic and strategic gain. However, the changing global and regional politics, along with the changed domestic scenario in this region and India’s pace of economic reforms are likely to determine the future course of their relationship.

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Suggested Readings

a) Books/Articles

Ashok Kumar Attri, India and Central Asian Republics, New Delhi, Regal, 2010.
B.G. Gafurov, Dialogue of Culture and Civilizations, Moscow: Embassies of India and Tajikistan in Russian Fedration, 2000.
K. Warikoo , Ethnicity and Politics in CentralAsia, New Delhi, South Asian Publishers, 1992.
P. Stobdan, Building a Common Future: India and Uzbek Perspective on Security and Economic Issue, New Delhi, Knowledge World, 1999.
Rashid Ahmed, The Resurgency of Central Asia: Islam or Nationalism, London, Zed Books, 1994.
Riyaz Punjabi and Others ed., India and Islamic World, New Delhi, Radient Publishers, 1998.
R.S.Yadav & Suresh Dhanda, eds., India’s Foreign Policy: Contemporary Trends, New Delhi, Shipra, 2009.
R.S.Yadav, Bharat Ki Videsh Niti, New Delhi, Pearson, 2013.
Shirin Akiner ed. Political and Economic Trends in Central Asia, London, British Academic Press, 1994.

b) Web Links:-