In 2024, South Asia found itself in the midst of profound transformation. The region is navigating a complex geopolitical landscape characterised by political upheavals, shifting alliances, and the expanding influence of China.

The interplay between India’s regional ambitions, China’s strategic outreach, and the United States’ Indo-Pacific Strategy underscores the intricate power dynamics shaping the region. Additionally, significant political changes across key countries have created a fragile environment where entrenched rivalries and external influences heavily impact the region’s trajectory.

“In 2024, South Asia’s geopolitical landscape was radically altered, to the detriment of India and to the benefit of China and Pakistan. … China has won the mini-Cold War in South Asia, defeating the principal proxy of the US, which is a big setback to America’s Indo-Pacific Strategy,” commented Senator Mushahid Hussain, former head of the Senate’s influential foreign affairs and defence committees.

Looking ahead, the impending presidency of Donald Trump in 2025 introduces an air of uncertainty. Will his policies sustain the existing dynamics or disrupt the status quo in ways that redefine the region’s future? One thing is clear: South Asia’s stability and power dynamics hang in the balance, making the coming year pivotal in determining the course of this strategically vital region.

Dr Maleeha Lodhi, former envoy to the US, UK, and UN, believes the region will remain an arena for superpower competition “even though US interest in the region as a whole, save its deepening partnership with India, seems to have waned after the American withdrawal from Afghanistan.”

Modi’s triumph

Narendra Modi secured a historic third term as India’s prime minister in 2024, though the BJP fell short of a parliamentary majority, necessitating a coalition government. This election outcome reflected a shift in voter priorities, with economic grievances such as unemployment and income inequality overshadowing Hindu nationalist themes and India’s big power aspirations.

Despite challenges, the BJP regained momentum in subsequent state elections, achieving victories in Haryana and Maharashtra, and strengthening its position in by-elections. With a majority in the Rajya Sabha, the BJP is now better placed to deal with the demands of regional allies while advancing contentious reforms like labour laws, privatisation, and the Uniform Civil Code.

India’s ‘Neighbourhood First’ strategy continues to emphasise ties with Bangladesh, Sri Lanka, and Nepal. Relations with China showed cautious improvement after Modi’s meeting with President Xi Jinping in Kazan on the sidelines of the BRICS Summit leading to resumption of high-level talks over border disputes and selective trade cooperation.

However, ties with Pakistan remained in a diplomatic deadlock, with India prioritising counterterrorism and showing little interest in dialogue on Kashmir. Strategic partnerships with the US and the Quad, meanwhile, continued to be robust, but simmering strains in India-US ties became more pronounced in 2024.

The US recognises that its convergence with India on China has limits due to India’s domestic challenges and the militarised Sino-Indian land border, which restricts India’s ability to engage beyond its immediate backyard. The rise of the Philippines as a more attractive US partner in countering China and the Quad’s underperformance have also contributed to Washington exploring alternatives.

Further incidents straining India-US relations included the White House warning India over a reported plot to assassinate a Sikh activist on American soil and the indictment of Indian tycoon Gautam Adani by a US court for allegedly bribing Indian officials for power supply projects.

Efforts to position India as a manufacturing hub were hindered by limited structural reforms and sluggish foreign investment. Growth rates have been continuously slipping. GDP growth for the July-September 2024 quarter was 5.4 per cent — the lowest for any quarter in two years and the third consecutive slowdown due to sluggish manufacturing and mining performance.

Hasina’s departure

Meanwhile, mass protests in Bangladesh over economic grievances, job quotas, and political repression culminated in Sheikh Hasina’s resignation and exile, marking the end of her tenure. Dr Muhammad Yunus now leads an interim government backed by the military, tasked with stabilising the country and preparing for elections.

Mushahid Hussain described Hasina’s fall as “the biggest blow to India since Pakistan became a nuclear power in 1998.”

Yunus’s policies, including lifting bans on Islamist groups, have raised concerns about extremism. India, previously a close ally under Hasina, views these developments with apprehension, fearing increased anti-India sentiment.

Meanwhile, China sees an opportunity to expand its influence, leveraging economic and military ties. Yunus’s engagement with the West, however, counters Beijing’s sway, potentially reshaping Bangladesh’s geopolitical stance.

Lanka veers left

Anura Kumara Dissanayake’s rise to the presidency and the National People’s Power coalition’s parliamentary victory marked a peaceful yet transformative political shift in Sri Lanka. This transition reflected public discontent with past corruption and economic mismanagement.

Dissanayake’s administration has promised to promote transparency, pluralism, and anti-poverty reforms. While initially known for his pro-China stance, early moves to improve India-Sri Lanka relations, including cooperation on fishing rights and development projects, signal a recalibration even as contentious issues like Indian energy investments remain divisive. Dissanayake’s first overseas trip was to India, but he is expected to visit China in early 2025 to address issues such as Chinese naval research vessels accessing Sri Lankan waters and docking at the Hambantota Port, a point of contention with India.

Cautious balance

The formation of K.P. Sharma Oli’s coalition government between the Communist Party of Nepal (UML) and Nepali Congress marked a rare phase of political stability, enabling progress on infrastructure and diplomacy.

Nepal’s strategic position between India and China continues to shape its foreign policy. Oli’s first overseas visit was to China, during which the two countries concluded a protracted seven-year negotiation on the Framework for Belt and Road Cooperation, paving the way for the revival of stalled Belt and Road Initiative projects.

Nepal, however, is cautiously balancing Chinese investments against debt risks. Relations with India remain nuanced as Kathmandu navigates competing influences while seeking mutual cooperation on trade and security. Coalition partner Nepali Congress is a staunch backer of India ties. Oli’s visit to Beijing was soon after followed by Nepali Army Chief General Ashok Raj Sigdel’s trip to India from Dec 11-14.

‘India out’

Maldives President Mohamed Muizzu’s government consolidated power with a decisive parliamentary majority. The ‘India Out’ movement initially drove efforts to reduce Indian influence, including the removal of Indian troops from the archipelagic state. However, economic dependence on India prompted a more pragmatic approach, with Muizzu referring to India as a “valued partner” during a state visit. Simultaneously, the Maldives strengthened ties with China, securing infrastructure and defence agreements. This dual-track diplomacy underscores the intensifying India-China rivalry in the Indian Ocean.

Myanmar conflict

Myanmar’s post-coup conflict escalated, with insurgent groups gaining ground against the military junta, worsening humanitarian conditions. Over 32,000 refugees fled to India, straining resources in its north-eastern states already grappling with ethnic tensions. India’s relationship with Myanmar is shaped by the need to counter China’s influence while managing border security threats, though the junta’s reliance on China complicates regional dynamics.

Taliban rigidity

Since regaining power in August 2021, the Afghan Taliban have struggled to gain formal recognition due to their failure to meet international expectations on counterterrorism, human rights, and inclusive governance.

Although diplomatic engagement with the Taliban increased, reflecting a cautious global approach, no country formally recognised its regime. The West, meanwhile, shifted its strategy from forcing regime change to encouraging internal reform through regional diplomacy and discreet pressure.

The Taliban failed to curtail terrorist activities effectively, with groups like IS-K, Al-Qaeda, and the TTP remaining active. Women’s and girls’ rights were severely restricted under Taliban policies, further alienating the international community and hindering recognition prospects.

Elephant in the room

The United States’ engagement in South Asia transcends mere interest, resembling the influence of a ‘next-door neighbour’ whose actions are acutely felt. As Donald Trump prepares for his second presidency in 2025, regional actors are closely watching how his administration will shape the US’s strategic priorities for the region.

Trump’s return is anticipated to reinforce Washington’s focus on its great power competition with China, profoundly influencing South Asia. The countries in the region may face increased pressure to align with one of the two powers, potentially escalating regional tensions.

“If the US-China relationship becomes even more turbulent, this will not help stability in South Asia. However, if tensions ease with president-elect Trump taking a transactional approach to Beijing, that will have a stabilising effect on South Asia. It will also open opportunities to reset Pakistan-US relations, which today are at an inflection point,” Dr Lodhi said.

A cornerstone of Trump’s South Asia policy will likely be the strengthening of US-India relations. As part of the Indo-Pacific Strategy, Trump is expected to deepen strategic and economic ties with India, supporting its role as a regional counterbalance to China. This alignment may expand cooperation in defence, technology, and infrastructure, though Trump’s transactional style could push India toward greater concessions, especially in trade negotiations.

Ambassador Masood Khan, former envoy to China and the US, referred to the bipartisan consensus in Washington on strong strategic ties with India, stating: “President Trump is likely to espouse and continue with that policy. His inclination is to have strong strategic ties with India.” However, he foresees “Indian leaders’ hubris and bravado denting or scuppering the relationship from time to time.”

Trump’s administration is also likely to recalibrate its engagement with smaller South Asian countries, selectively extending economic and security assistance to reduce these nations’ dependence on China. This approach could restrict the strategic autonomy of smaller countries in the region.

Pakistan, historically a key US partner, may continue to experience strained relations under Trump. While strategic cooperation, particularly in security domains, is expected to remain limited, non-security collaboration in areas like trade and development could serve as a neutral ground for engagement. However, this relationship is unlikely to regain its historical warmth due to divergent priorities.

As we enter 2025, South Asia stands at a crossroads. While external forces undoubtedly play a role, the region’s future hinges on its capacity to confront internal vulnerabilities and cultivate greater cooperation. Fostering deeper economic integration and expanding trade within the region will be essential to buffer against global economic headwinds. Furthermore, by embracing diplomacy, multilateralism, and robust regional cooperation, South Asia can unlock its vast potential and chart a sustainable course towards economic recovery and stability.

Header image: Anti-government protesters display Bangladesh’s national flag as they storm prime minister Sheikh Hasina’s palace in Dhaka on August 5, 2024. — AFP/File

An abridged version of this article was published in Dawn on Jan 1, 2025.