India's Modi visits Bhutan on first step of bid to reassert regional sway

Indian Prime Minister Narendra Modi (L) gestures as he is met by Bhutanese Prime Minister Tshering Tobgay (R) at Paro Airport on June 15, 2014.  –AFP

Reuters/Thimphu

Indian Prime Minister Narendra Modi on Sunday kicked off his first visit abroad since taking office, arriving in Bhutan to launch a drive to reassert Indian influence in the region, offering financial and technical help and the lure of a huge market.

The tiny Buddhist nation wedged in the Himalayas between India and China is the closest India has to an ally in South Asia, a region of bristling rivalry where China is making inroads.

While India has been struggling recently with policy paralysis and a slowing economy, China has been building ports in Sri Lanka, Bangladesh and its "all-weather ally", Pakistan. China overtook India as the biggest foreign investor in Nepal in the first six months of this year.

Modi's Hindu nationalist party has vowed to end the neglect of neighbours and in an unprecedented gesture, he invited all regional leaders to his inauguration last month.

The choice of a visit to Bhutan to build on the inaugural outreach shows an astute sense of the region's critical importance to India's economic dynamism and strategic strength, said Alyssa Ayres, a South Asia expert at the New York-based Council on Foreign Relations.

"Of course, India is also closely watching China's border talks with Bhutan and China's recent efforts to establish stronger ties with Thimphu," she said on the thinktank's Asia Unbound blog.

On Sunday, hundreds of school children dressed in traditional red and green tunics lined the route from the airport to wave the Indian flag as Modi's motorcade arrived in Bhutan's capital of Thimphu, nestled among mountains and for centuries closed to outsiders.

At the airport, Modi was welcomed with a ceremonial white scarf by Bhutan's Prime Minister Tshering Tobgay and cabinet members, wearing the national costume of ankle-length red robe.

During the trip, Modi will lay the foundation of a 600 MW hydroelectric power station and inaugurate a parliament building also constructed by India.

"Bhutan and India share a very special relationship that has stood the test of time," Modi said before he left New Delhi. "Thus, Bhutan was a natural choice for my first visit abroad."

In the longer term, Modi's government aims to make India the dominant foreign investor across South Asia as well as the main provider of infrastructure loans, in the same way China has done in much of the rest of Asia and in Africa.

Consolidating ties with difficult neighbours like Pakistan and Bangladesh could reduce poverty and transform regional security relationships, Indian officials say.

"Although India would like to have a greater say in South Asian matters beyond trade, so far we have not been able to exercise substantial political clout," said P.D. Rai, a lawmaker from the state of Sikkim, which shares a border with Bhutan.

"Modi's first visit to Bhutan will have to be looked at in this light."

He is accompanied by Foreign Minister Sushma Swaraj as well as National Security Adviser, Ajit Doval, credited with helping craft the neighbours-first policy.

ENTHUSIASTIC RESPONSE

India's neighbours have responded enthusiastically to Modi's overtures. His Pakistani counterpart, Nawaz Sharif, overcame resistance at home to attend the inauguration even though political ties remain fragile and marked by deep distrust.

On Sunday, giant portraits of Modi and his Bhutanese counterpart, Tobgay, were strung up along the highway Modi took from the airport. Prayer flags tied high on poles fluttered in the wind in the deeply religious country.

Bhutan, the size of Switzerland and with a population of 750,000, has only recently emerged from centuries of isolation.

Its first road was built in 1962 and television and the Internet arrived in 1999.

It is the first country to monitor gross national happiness, an alternative to gross domestic product, to balance a tentative embrace of modernity with an effort to preserve traditions.

But Bhutan, which made the transition from absolute monarchy to parliamentary democracy in 2008, is struggling with high unemployment and a growing national debt.

The government that took power in 2012 says it wants to focus on obstacles to happiness.

"It is good that we are being connected to the world, we are all on Facebook," said schoolgirl Tenzin Lamsang, as she and a group of friends prepared to greet the Indian leader.