16th February 2025

Topic: Reciprocal Tariffs
Relevance: GS Paper 3 Trade and Economy
Source: Indian Express
Context:

1. What Are Reciprocal Tariffs?
   Tariffs are taxes imposed on imported goods by a country to make foreign products costlier and thus protect domestic industries. Traditionally, global trade has moved towards reducing tariffs to encourage free trade, particularly after World War II, through agreements like the General Agreement on Tariffs and Trade (GATT) and the World Trade Organization (WTO).
   However, special provisions allowed developing countries like India to impose higher tariffs to protect their domestic economies. Trump’s reciprocal tariff proposal seeks to eliminate this differentiation by imposing the same tariffs on imports as those levied on US exports. This means that if India imposes a high tariff on US goods, the US will reciprocate with an equal tariff on Indian exports.
2. How Will Reciprocal Tariffs Be Calculated?
   The US trade department is still working out the exact numbers for each country. However, Trump’s approach is not merely to mirror tariffs but also to account for subsidies and government support provided to exporters.
   For example, India’s Production Linked Incentive (PLI) scheme, which provided Rs 8,700 crore ($1 billion) between 2022 and 2024 to boost mobile phone exports, may be considered an unfair advantage. If such subsidies are taken into account, Indian exports could face even higher tariffs.
3. Why Is Trump Implementing Reciprocal Tariffs?
   Trump’s policy stems from multiple reasons:
4. Trade Deficit Concerns – The US has a trade deficit nearing $1 trillion, while China enjoys a surplus of more than $1 trillion. Trump believes deficits indicate unfair trade practices against the US.
5. Domestic Industry Protection – Trump wants to make it costlier for foreign companies to export to the US, forcing them to either import more from the US or set up manufacturing units in the US.
6. Political and Economic Leverage – Trump’s tariff policies target not just adversaries like China but also allies like Canada, Mexico, and the European Union, using trade as a bargaining chip for broader geopolitical interests.
7. Are Trade Deficits Always Bad?
   While a trade deficit means more money is flowing out of the country than coming in, it is not necessarily harmful. Trade deficits allow consumers to access cheaper goods. Instead of focusing on eliminating deficits, a country should enhance domestic productivity.
   India, for example, has a trade surplus with the US but a deficit with China, showing the interlinked nature of global trade. Protectionist measures like tariffs can backfire by increasing costs for domestic consumers and businesses.
8. Potential Impact on India
   Trump’s reciprocal tariff policy directly affects India in multiple ways:
   A. Increased US Exports to India
   • To counterbalance the trade deficit, India may have to import more US goods, including defense equipment, oil, and gas.
   • US products may become cheaper for Indian consumers, increasing their demand.
   B. Weaker Indian Rupee
   • If India starts buying more from the US, the demand for US dollars will increase, leading to rupee depreciation.
   • A weaker rupee makes imports more expensive in the long run, affecting India’s economy.
   C. Impact on “Atmanirbhar Bharat” (Self-Reliant India)
   • Increased imports from the US contradict India’s Atmanirbhar Bharat vision, which aims to boost domestic manufacturing.
   • Domestic industries (e.g., automobiles, pharmaceuticals, and electronics) could suffer if Indian consumers shift to cheaper US alternatives.
   D. Consumption and GDP Growth
   • India’s recent income tax cuts (Rs 1 lakh crore tax relief) were meant to boost domestic consumption.
   • However, if wealthier Indians spend more on cheaper US products, it might not stimulate India’s GDP as intended but instead boost US economic growth.
   E. India’s Trade Policy Shift
   • India might negotiate a new trade deal with the US to prevent excessive tariffs.
   • Future trade agreements could focus on strategic sectors like technology, pharmaceuticals, and services.
9. Geopolitical Considerations
   Trump’s tariffs highlight a shift in US foreign policy, treating even allies like Canada, Mexico, and the EU harshly. His comments about making Canada the 51st state of the US and calling Prime Minister Trudeau “Governor” Trudeau show how aggressive his trade stance is.

India must tread cautiously, balancing its trade relations with the US while safeguarding its domestic interests.
Trump’s reciprocal tariffs mark a shift away from traditional free trade principles and could impact India’s trade strategy, economic growth, and currency stability. While some benefits exist (cheaper US products, stronger trade ties with the US), the policy could hurt India’s long-term economic goals, including self-reliance.

The famous economist Milton Friedman, quoting Henry George, aptly described the irony of tariffs:
“In times of war, we blockade our enemies in order to prevent them from getting goods from us. In time of peace, we do to ourselves by tariffs what we do to our enemies in time of war.”
India’s response to these developments will determine its future trade position and economic trajectory.
Prelims Practice Question:
Consider the following statements regarding “Reciprocal Tariffs” proposed by the United States:

1. Reciprocal tariffs aim to impose the same level of tariffs on imports as the exporting country imposes on US goods.
2. The policy considers not only tariff rates but also government subsidies provided to exporters while determining tariffs.
3. This policy benefits developing countries like India by reducing trade barriers and promoting free trade.
4. The policy is primarily targeted at China and does not affect US allies like Canada and the European Union.
   Which of the above statements are correct?
   (a) 1 and 2 only
   (b) 1, 2, and 3 only
   (c) 1, 2, and 4 only
   (d) 3 and 4 only
   Answer:
   Correct Option: (a) 1 and 2 only
   Explanation:
   • Statement 1 is correct: Reciprocal tariffs mean that the US will impose the same tariffs on imports as other countries impose on US exports.
   • Statement 2 is correct: The policy includes not just tariff rates but also considers subsidies and other trade advantages provided by exporting countries.
   • Statement 3 is incorrect: This policy does not benefit developing countries like India, as it removes preferential tariff advantages that they previously enjoyed.
   • Statement 4 is incorrect: The policy applies to all countries, including US allies like Canada, Mexico, and the European Union, not just China.
   Thus, the correct answer is (a) 1 and 2 only.
   Mains Model Question:

“The US policy of reciprocal tariffs marks a shift away from traditional free trade principles and poses significant challenges for developing economies like India.” Discuss the implications of this policy on India’s trade, economy, and self-reliance goals. (Answer in 250-300 words)
The US policy of reciprocal tariffs, introduced by former President Donald Trump, aims to impose the same level of tariffs on imports as other countries impose on US exports. This policy disrupts the long-standing global trade order, which traditionally allowed developing countries to impose higher tariffs to protect their domestic industries.
Implications for India:

1. Increased Import Costs & Trade Adjustments:
   India may be compelled to increase imports from the US, particularly in defense, energy (oil & gas), and technology sectors, to balance trade deficits. This could lead to a weaker rupee due to increased demand for dollars.
2. Impact on Domestic Industries & Atmanirbhar Bharat:
   India’s domestic manufacturers, particularly in automobiles, electronics, and agriculture, may struggle to compete with cheaper US imports, hampering the government’s Atmanirbhar Bharat (Self-Reliance) initiative.
3. Challenges for Indian Exports:
   Many Indian exports, especially in textiles, pharmaceuticals, and IT services, benefit from government incentives. If the US considers these subsidies while determining tariffs, India could face higher trade barriers, reducing its global competitiveness.
4. Effect on Economic Growth & Consumption:
   The recent Indian tax cuts (Rs 1 lakh crore relief) aimed at boosting domestic demand might instead fuel the purchase of cheaper US goods, shifting economic benefits to the US rather than strengthening India’s GDP.
5. Geopolitical Considerations:
   The policy reflects the US’s aggressive trade stance, affecting even allies like Canada and the EU. India must navigate this carefully, balancing strategic ties with the US while safeguarding its trade interests.
   Conclusion:
   While reciprocal tariffs may lead to cheaper US products for Indian consumers, they pose risks to India’s domestic industries, currency stability, and economic self-sufficiency. India must negotiate strategically to protect its trade interests while maintaining strong US relations.
   Topic: Chief Election Commissioner
   Relevance: GS Paper 2 Polity and Governance
   Source: The Hindu
   Context:

Appointment of the Chief Election Commissioner (CEC) and Election Commissioners (ECs): Constitutional and Legislative Provisions

1. Constitutional Provisions
   The Election Commission of India (ECI) is an autonomous constitutional body responsible for conducting free and fair elections in India. The provisions related to its composition, powers, and appointment of its members are provided under Article 324 of the Indian Constitution.
   • Article 324(1): It vests the “superintendence, direction, and control” of elections in India in the Election Commission.

• Article 324(2): It provides that the Election Commission shall consist of:
o The Chief Election Commissioner (CEC), and
o Such number of other Election Commissioners (ECs) as the President may determine.
• Article 324(5): It states that the tenure and service conditions of the CEC and ECs shall be determined by law enacted by Parliament. However, it also provides that the CEC cannot be removed from office except in the manner prescribed for the removal of a Supreme Court judge (i.e., through impeachment by Parliament).
• Article 324(6): The President shall, when necessary, provide the Election Commission with such staff as may be required to discharge its functions.

2. Historical Evolution of Appointment Process
   Before the enactment of the Chief Election Commissioner and Other Election Commissioners (Appointment, Conditions of Service And Term of Office) Act, 2023, the appointment process of the CEC and ECs was not explicitly defined in any parliamentary law. The appointments were made by the President based on the advice of the government, often following the convention of promoting the senior-most Election Commissioner to the position of CEC.
   In 2023, the government introduced a new law to provide a structured mechanism for the appointment of the CEC and ECs.
3. Chief Election Commissioner and Other Election Commissioners (Appointment, Conditions of Service And Term of Office) Act, 2023
   The 2023 Act brought significant changes to the appointment process of the CEC and ECs.
   Key Features of the Act:
4. Selection Committee Composition:
   o The Prime Minister (Chairperson)
   o The Union Home Minister
   o The Leader of Opposition (LoP) in Lok Sabha
5. Search Committee:
   o The Search Committee is chaired by the Law Minister.
   o It consists of two Secretaries to the Government of India.
   o It prepares a panel of five names for consideration by the Selection Committee.
6. Eligibility Criteria:
   o The CEC and ECs must be chosen from persons who hold or have held a post equivalent to the rank of Secretary to the Government of India.
   o They must be individuals of integrity, with knowledge and experience in the management and conduct of elections.
7. Term and Conditions:
   o The CEC and ECs will have a tenure of six years or until they attain the age of 65 years, whichever is earlier.

o The salary, allowances, and conditions of service shall be equivalent to that of a Supreme Court judge.

5. Appointment Outside the Search Committee Panel:
   o The Selection Committee has the discretion to appoint a person outside the panel proposed by the Search Committee.
6. Implications of the 2023 Act
7. Change from Seniority-Based Appointment:
   o Previously, the senior-most Election Commissioner was promoted as the CEC.
   o Now, the government can appoint any eligible person directly as the CEC, which may lead to political considerations in the appointment process.
8. Possible Political Influence:
   o Earlier, appointments were made solely by the President on the advice of the Council of Ministers.
   o The inclusion of the Leader of the Opposition (LoP) provides a check, but critics argue that the government still has a majority in the committee (2 out of 3 members).
9. Judicial Challenge:
   o The Supreme Court is scheduled to hear a petition challenging the validity of the 2023 Act on February 19, 2025.
   o The petitioners argue that the new appointment process reduces the autonomy of the Election Commission and may compromise its independence.
10. Comparison with the Supreme Court’s 2023 Ruling:
    o In March 2023, the Supreme Court, in the case of Anoop Baranwal v. Union of India, directed that a CEC/ECs Selection Committee should include the Chief Justice of India (CJI) along with the Prime Minister and the Leader of the Opposition.
    o However, the 2023 Act removed the CJI from the committee, which has been criticized as a dilution of institutional safeguards.
11. Recent Developments and Expected Challenges
    • The upcoming appointment of the next CEC on February 17, 2025, will be the first under the new Act.
    • Election Commissioner Gyanesh Kumar, being the senior-most EC, could be promoted, but the Selection Committee is not bound to follow seniority.
    • The Supreme Court hearing on February 19, 2025, may lead to legal scrutiny of the 2023 Act’s constitutionality, particularly regarding its impact on the independence of the Election Commission.
    The Chief Election Commissioner and Other Election Commissioners (Appointment) Act, 2023 has introduced a structured selection process for the CEC and ECs. While it attempts to institutionalize transparency, concerns remain over political influence in appointments. The upcoming Supreme Court judgment will be crucial in determining whether the Act aligns with the principles of free and fair elections, as enshrined in the Constitution.
    India’s democratic framework relies on the impartiality of the Election Commission. Any perception of political bias in appointments could undermine public confidence in the electoral process. Moving forward, a more independent selection process, possibly with the inclusion of the Chief Justice of India, may be necessary to strengthen the credibility and neutrality of the Election Commission.
    Prelims Practice Question
    Q. Consider the following statements regarding the appointment of the Chief Election Commissioner (CEC) and Election Commissioners (ECs) in India:
12. The CEC and ECs are appointed by the President of India based on the recommendation of a Selection Committee.
13. The Selection Committee consists of the Prime Minister, the Union Home Minister, and the Chief Justice of India.
14. The tenure of the CEC and ECs is six years or until they attain the age of 65 years, whichever is earlier.
15. The removal process of the CEC is similar to that of a Supreme Court judge, while ECs can be removed by the President on the recommendation of the CEC.
    Which of the above statements are correct?
    (A) 1 and 2 only
    (B) 1, 3, and 4 only
    (C) 2 and 3 only
    (D) 1, 2, 3, and 4
    Answer:
    Correct Option: (B) 1, 3, and 4 only
    Explanation:
    • Statement 1 is correct: As per the Chief Election Commissioner and Other Election Commissioners (Appointment, Conditions of Service And Term of Office) Act, 2023, the President appoints the CEC and ECs based on the recommendation of a Selection Committee consisting of the Prime Minister, the Home Minister, and the Leader of the Opposition in Lok Sabha.
    • Statement 2 is incorrect: The Chief Justice of India (CJI) is not a part of the Selection Committee. Earlier, in March 2023, the Supreme Court had ruled that the CJI should be included, but the government later passed the 2023 Act, which excluded the CJI from the Selection Committee.
    • Statement 3 is correct: The CEC and ECs hold office for six years or until they attain the age of 65 years, whichever is earlier, as per the 2023 Act.
    • Statement 4 is correct: The CEC can only be removed through impeachment, similar to a Supreme Court judge, while Election Commissioners can be removed by the President on the recommendation of the CEC.
    Thus, the correct answer is (B) 1, 3, and 4 only.
    Mains Model Question
    Q. Discuss the key provisions of the Chief Election Commissioner and Other Election Commissioners (Appointment, Conditions of Service And Term of Office) Act, 2023. How does it impact the independence of the Election Commission of India?
    The Chief Election Commissioner and Other Election Commissioners (Appointment, Conditions of Service And Term of Office) Act, 2023 was enacted to provide a structured mechanism for appointing the Chief Election Commissioner (CEC) and Election Commissioners (ECs).
    Key Provisions of the Act:
16. Selection Committee: The Act establishes a three-member Selection Committee comprising the Prime Minister (Chairperson), the Home Minister, and the Leader of Opposition (LoP) in Lok Sabha.
17. Search Committee: A Search Committee, headed by the Law Minister and comprising two senior government secretaries, prepares a panel of five names for the Selection Committee’s consideration.
18. Eligibility Criteria: The CEC and ECs must be current or former officers of the rank of Secretary to the Government of India with experience in election management.
19. Tenure and Service Conditions: The tenure is six years or until the age of 65 years, whichever is earlier. Their salary and conditions of service are equivalent to Supreme Court judges.
20. Removal Process: The CEC can only be removed through impeachment, while ECs can be removed by the President on the recommendation of the CEC.
    Impact on the Independence of the Election Commission:
    • Exclusion of the Chief Justice of India (CJI) from the Selection Committee raises concerns about political influence in appointments.
    • Government Dominance: With two out of three members from the ruling party, the process may lack neutrality.
    • Potential Politicization: The discretionary power to appoint any eligible person, even outside the Search Committee’s list, may undermine institutional autonomy.
    While the Act aims to institutionalize transparency, critics argue that it reduces the Election Commission’s independence, which is vital for ensuring free and fair elections in India. A more neutral selection process, possibly including the CJI, could enhance credibility.

Topic : Panama Canal: Geopolitical Significance, Strategic Concerns, and China’s Influence
Relevance : GS Paper 1 Geography
Source : Indian Express
Context :
The Panama Canal is one of the most crucial waterways in global trade, acting as a vital maritime shortcut between the Atlantic and Pacific Oceans. It significantly reduces travel time for commercial shipping, cutting around 8,000 nautical miles from the journey between the east and west coasts of the Americas.

1. Geographical and Strategic Importance

Location and Features
• The Panama Canal is located in Central America, linking the Caribbean Sea (Atlantic Ocean) to the Pacific Ocean.
• It is 82 km (51 miles) long and has a system of locks that raise and lower ships as they cross the Isthmus of Panama.
• The canal operates via three major sets of locks:
o Gatún Locks (Atlantic side)
o Pedro Miguel Locks
o Miraflores Locks (Pacific side)
• Lake Gatún, an artificial lake, serves as a critical part of the canal, allowing vessels to traverse the region’s rugged terrain.
Trade and Economic Role
• Around 40% of U.S. container ship traffic passes through the Panama Canal.
• The canal handles approximately 5% of global trade.
• The United States, China, and Japan are among its biggest users.
• It accommodates Neo-Panamax ships since its 2016 expansion, allowing larger cargo vessels to pass through.

2. Historical Context and U.S. Control
   • The Panama Canal was built by the United States between 1904 and 1914, following Panama’s independence from Colombia (with U.S. backing).
   • The U.S. controlled the canal until 1999 under the Torrijos-Carter Treaties (1977), which ensured Panama’s sovereignty over the canal while allowing the U.S. to militarily protect its neutrality.
   • Since December 31, 1999, the Panama Canal Authority (ACP), an autonomous Panamanian agency, manages the canal.
3. China’s Growing Influence in Panama and the Canal
   Belt and Road Initiative (BRI) and Panama
   • In 2017, Panama became the first Latin American nation to join China’s BRI, strengthening economic ties.

• Chinese firms have invested in infrastructure, ports, and logistics in Panama, including:
o Panama Ports Company (PPC) (operates major ports at the canal’s entry and exit points).
o China Ocean Shipping Group (COSCO), a major user of the canal.
o Chinese-funded projects such as highways, bridges, and a high-speed railway proposal.
Strategic Concerns for the U.S.
• The U.S. perceives China’s growing economic and security footprint in Panama as a direct challenge to its influence in the Western Hemisphere.
• The U.S. has raised concerns that Chinese state-controlled firms in the Panama Canal could be pressured by Beijing in case of a conflict, turning the canal into a geopolitical choke point.
• China’s presence in Latin America has expanded through trade, military exchanges, and financial aid, alarming Washington.

4. Recent Developments and Panama’s Response
   Panama’s Decision to Leave BRI
   • In February 2025, Panama decided not to renew its Memorandum of Understanding (MoU) on BRI, citing pressure from the United States.

• The U.S. has been actively discouraging Latin American nations from aligning with China’s global initiatives.
• President Jose Raul Mulino reaffirmed Panama’s sovereignty over the canal, stating, “There are no Chinese soldiers in the canal… There is no discrimination in foreign investment.”
Potential Impacts
• China may retaliate economically by reducing trade or investment in Panama.
• Panama may seek a balanced approach between U.S. and Chinese interests to protect its economic stability.
• The decision could weaken China’s influence in Latin America, though Beijing remains a major trade and infrastructure partner in the region.

5. The Panama Canal as a Geopolitical Battleground
   The Panama Canal remains a focal point of U.S.-China competition, given its strategic economic and military value. While Panama asserts its neutrality, external pressures from both Washington and Beijing will continue to shape its policies. The U.S. aims to contain China’s influence in Latin America, while China seeks to maintain its economic presence. The canal’s future management will be critical in determining the balance of power in the region.
   Prelims Practice Question:
   Consider the following statements regarding the Panama Canal:
6. The Panama Canal connects the Atlantic Ocean to the Indian Ocean.
7. It is operated by the United States government under the Torrijos-Carter Treaties.
8. China has significant economic influence in Panama, including investments in port operations near the canal.
9. The Panama Canal was expanded in 2016 to accommodate larger ships.
   Which of the above statements are correct?
   (a) 1 and 2 only
   (b) 3 and 4 only
   (c) 2 and 4 only
   (d) 1, 3, and 4 only
   Answer:
   Correct Option: (b) 3 and 4 only
   Explanation:
   • Statement 1 is incorrect: The Panama Canal connects the Atlantic Ocean to the Pacific Ocean, not the Indian Ocean.
   • Statement 2 is incorrect: The canal was controlled by the United States until 1999, but after the Torrijos-Carter Treaties (1977), it was handed over to Panama. It is now operated by the Panama Canal Authority (ACP).
   • Statement 3 is correct: China has significant investments in Panama, including port operations through Chinese companies like Panama Ports Company (PPC) and COSCO.
   • Statement 4 is correct: In 2016, the Panama Canal was expanded with a new set of locks to accommodate Neo-Panamax ships, allowing larger vessels to pass through.
   Thus, the correct answer is (b) 3 and 4 only.
   Mains Model Question
   Q. The Panama Canal has long been a strategic waterway of global importance. Discuss its geopolitical significance and the emerging contest between the United States and China over its control and influence. (300 words)
   The Panama Canal is a crucial maritime passageway that connects the Atlantic and Pacific Oceans, significantly reducing the time and cost of global trade. Completed in 1914 by the United States, it remained under U.S. control until 1999, when it was transferred to Panama under the Torrijos-Carter Treaties (1977).
   Geopolitical Significance:
10. Trade and Global Commerce: The canal facilitates nearly 5% of global trade, making it one of the busiest waterways in the world.
11. Strategic Location: It is vital for U.S. naval operations and supply chain stability, particularly in case of conflicts in the Indo-Pacific.
12. Economic Hub: The canal boosts Panama’s economy through toll revenues and attracts foreign investment.
    US-China Contest Over Influence:
    • China’s Growing Role: Chinese companies, such as COSCO and Panama Ports Company (PPC), have invested heavily in Panama’s port operations. China is also Panama’s largest trading partner outside the U.S.
    • US Concerns: The U.S. views China’s presence as a national security threat, fearing China could control maritime chokepoints during a conflict. Recent U.S. diplomatic pressure has led to Panama reconsidering its Belt and Road Initiative (BRI) ties with China.

• Panama’s Balancing Act: While maintaining its sovereignty, Panama seeks to balance relations between the two superpowers while benefiting economically.
Conclusion:
The Panama Canal remains a geopolitical flashpoint, with both China and the U.S. competing for influence. While China’s investments in infrastructure raise strategic concerns, Panama is keen on maintaining neutrality and economic gains. The outcome of this contest will shape regional and global trade dynamics in the coming years.

Topic : India-Sri Lanka Cooperation in Critical Minerals and Mining
Relevance : GS Paper 2 International Relations
Source : PIB
Context :

India and Sri Lanka have taken a significant step toward strengthening their cooperation in mineral exploration and mining, particularly in critical minerals essential for clean energy and high-tech industries. The recent meeting between Union Minister of State for Coal and Mines, Shri Satish Chandra Dubey, and Sri Lankan Minister of Industry and Entrepreneurship Development, Shri Sunil Handunnetti, marks a crucial development in bilateral ties.
Key Highlights of the Meeting

1. Focus on Critical Minerals
   o The discussions primarily revolved around securing a stable supply of critical minerals like lithium, graphite, nickel, cobalt, and copper, which are crucial for renewable energy, battery technologies, and electronics.
   o Sri Lanka’s vast graphite and beach sand mineral reserves are of particular interest to India due to their industrial applications.
2. Bilateral Cooperation in Mining & Exploration
   o Both nations recognized the need for joint mineral exploration and mining projects.

o The Geological Survey of India (GSI) expressed interest in conducting mineral assessments in Sri Lanka.
o Discussions included possibilities of Government-to-Government (G2G) exploration agreements.

3. Investment Opportunities for Indian Companies
   o Sri Lanka requested India to encourage Indian companies to invest in and participate in the exploration and development of its beach sand and graphite resources.
   o India is actively granting mining rights for critical minerals and forming international partnerships to secure raw material supplies.
4. Memorandum of Understanding (MoU) on Geology & Mineral Resources
   o The two sides discussed finalizing an MoU between India’s Ministry of Mines and Sri Lanka’s Geological Survey & Mines Bureau.
   o This MoU aims to facilitate:
    Capacity building and knowledge exchange
    Advanced mineral processing collaboration
    Technological and financial assistance to modernize Sri Lanka’s mining industry
5. Strengthening India-Sri Lanka Economic Relations
   o Shri Dubey emphasized that stronger mining ties will enhance overall economic cooperation.
   o He reiterated India’s commitment to supporting Sri Lanka in skill development and modernization of its mining sector.
   India-Sri Lanka Relations: A Broader Perspective
   Historical & Cultural Ties

• India and Sri Lanka share deep-rooted historical, religious, and cultural ties, dating back to ancient times.
• Buddhism plays a major role in the cultural linkages, with Sri Lanka being one of the earliest countries to embrace Buddhism from India.
Political & Strategic Cooperation
• India has always been a key strategic partner for Sri Lanka, providing economic and defense assistance.
• During Sri Lanka’s economic crisis in 2022, India provided nearly $4 billion in aid, including credit lines for fuel, food, and medicines.
• Defense ties include maritime security cooperation, joint military exercises, and intelligence sharing.
Economic & Trade Relations
• India is Sri Lanka’s largest trading partner, with bilateral trade exceeding $5 billion in recent years.
• The India-Sri Lanka Free Trade Agreement (ISFTA) has boosted economic ties.
• Indian investments in Sri Lanka span infrastructure, energy, pharmaceuticals, and IT sectors.
Connectivity & Regional Cooperation
• Both nations are working on connectivity projects like:
o Colombo Port terminal project (funded by India’s Adani Group)

o Proposed India-Sri Lanka land bridge project
o Strengthening air and ferry connectivity
Geopolitical Challenges & China’s Influence
• India is cautious about China’s increasing presence in Sri Lanka, especially in infrastructure projects like Hambantota Port and Colombo Port City.
• India’s cooperation in critical minerals is seen as a counterbalance to China’s growing economic influence in Sri Lanka.
The recent meeting between Indian and Sri Lankan ministers marks a significant step in deepening their economic and strategic ties through mineral cooperation. As India focuses on securing critical minerals for its renewable energy transition, partnerships with resource-rich neighbors like Sri Lanka will be crucial. This move also aligns with India’s “Neighbourhood First” policy, ensuring mutual growth and strategic stability in the Indian Ocean region.
Prelims Practice Question
Q. Consider the following statements regarding India-Sri Lanka cooperation in critical minerals and mining:

1. India and Sri Lanka have signed a Memorandum of Understanding (MoU) on “Cooperation in the Field of Geology and Mineral Resources.”
2. Sri Lanka has significant reserves of graphite and beach sand minerals, which are crucial for high-tech industries and clean energy.
3. The Geological Survey of India (GSI) has expressed interest in conducting mineral assessments in Sri Lanka.
4. India’s National Critical Mineral Mission focuses only on domestic mineral exploration and does not involve international partnerships.
   Which of the above statements are correct?
   (a) 1, 2, and 3 only
   (b) 2 and 4 only
   (c) 1 and 3 only
   (d) 1, 2, 3, and 4
   Answer:
   Correct option: (a) 1, 2, and 3 only
   Explanation:
   • Statement 1 is correct: India and Sri Lanka are finalizing an MoU on Geology and Mineral Resources to enhance cooperation in mineral exploration and mining.
   • Statement 2 is correct: Sri Lanka has vast reserves of graphite and beach sand minerals, essential for batteries, renewable energy, and electronics industries.
   • Statement 3 is correct: The Geological Survey of India (GSI) has shown interest in conducting mineral assessments in Sri Lanka.
   • Statement 4 is incorrect: India’s National Critical Mineral Mission focuses on both domestic and international partnerships to secure critical mineral supplies.
   Mains Model Question
   Q. Discuss the significance of India-Sri Lanka cooperation in mineral exploration and mining, with a focus on critical minerals. How does this partnership strengthen bilateral relations and contribute to economic and strategic interests?
   India and Sri Lanka share a long-standing relationship based on geographical proximity, historical ties, and economic cooperation. The recent discussions on mineral exploration and critical minerals add a new dimension to their partnership, enhancing strategic and economic collaboration.
   Significance of Cooperation in Mineral Exploration
5. Access to Critical Minerals: Sri Lanka has vast reserves of graphite and beach sand minerals, crucial for renewable energy, high-tech industries, and battery production. India, through its National Critical Mineral Mission, aims to secure a stable supply of these resources.
6. Technological Collaboration: India can assist Sri Lanka in modernizing its mining sector through advanced exploration techniques, mineral processing, and skill development.
7. Geological Survey of India (GSI) Involvement: The GSI has expressed interest in conducting mineral assessments, ensuring scientific exploration of resources.
8. Economic Opportunities: Indian companies can invest in Sri Lanka’s mineral sector, boosting trade, employment, and industrial growth in both nations.
   Strengthening Bilateral Relations
9. Strategic Partnership: Enhanced cooperation in minerals strengthens India-Sri Lanka ties, reducing China’s growing influence in the region.
10. Economic Integration: Collaboration aligns with Sri Lanka’s efforts to revive its economy post-crisis and helps India diversify its mineral supply chain.
11. Regional Stability: A strong economic partnership fosters trust and stability in the Indian Ocean region, benefiting both nations.
    In conclusion, India-Sri Lanka cooperation in mineral exploration presents a win-win situation, addressing India’s resource security concerns while aiding Sri Lanka’s economic recovery. This initiative reinforces bilateral ties, economic resilience, and regional stability.

Topic : India-Myanmar Bilateral Relations: A Comprehensive Analysis
Relevance : GS Paper 2 International Relations
Source : PIB
Context :

India and Myanmar share a 1,643 km-long land border and maritime boundaries in the Bay of Bengal, making Myanmar a crucial neighbor in India’s Act East Policy. As Myanmar is India’s gateway to Southeast Asia, bilateral relations are driven by historical ties, economic cooperation, security concerns, and cultural exchanges.
Historical and Cultural Ties
• Ancient Linkages: India and Myanmar have deep-rooted historical connections, with cultural and religious influences dating back to Buddhism and Hinduism.
• Colonial Era: Both nations were part of British India until Myanmar was separated in 1937.
• Post-Independence Relations: India was one of the first countries to recognize Myanmar’s independence in 1948, and both countries have cooperated in various domains since.

Political and Diplomatic Relations
• High-Level Engagements: Frequent visits by leaders have strengthened diplomatic ties. India has engaged with Myanmar even during its military rule to ensure regional stability.
• Strategic Importance: Myanmar is vital for India’s regional influence, countering China’s presence and maintaining peace in India’s northeastern states.
• Democracy and Stability: India has encouraged democratic reforms in Myanmar while balancing relations with its military leadership.
Economic and Trade Cooperation
Trade and Investment
• Bilateral trade (2023-24) was valued at approximately $2 billion, with a focus on agriculture, pharmaceuticals, and energy.
• Key exports from India: Pharmaceuticals, iron, steel, and petroleum products.
• Key imports from Myanmar: Beans, pulses, timber, and minerals.
• The Rupee-Kyat Trade Settlement Mechanism, recently launched, aims to reduce dependence on the dollar and boost trade.
Border Trade and Connectivity
• India and Myanmar have two operational border trade points at Moreh-Tamu (Manipur) and Zokhawthar-Rih (Mizoram), with plans to open more.

• Kaladan Multi-Modal Transit Transport Project: This crucial project connects India’s Northeast to Myanmar’s Sittwe port for enhanced trade.
• India-Myanmar-Thailand Trilateral Highway: Aiming to boost regional trade and connectivity with Southeast Asia.
Security and Strategic Cooperation
Counterterrorism and Border Security
• Myanmar plays a crucial role in curbing insurgent activities of groups operating in India’s Northeast.
• Joint military operations like Operation Sunrise (2019) have been conducted to target insurgent camps along the border.
• India supports Myanmar’s counterinsurgency efforts while ensuring stability in the region.
China Factor and Geopolitical Considerations
• Myanmar is a key battleground for India-China strategic competition.
• China has invested heavily in Myanmar’s infrastructure, ports (Kyaukphyu), and energy projects, leading India to increase its engagement to balance China’s influence.
Development Cooperation
• India has extended over $1.75 billion in grants and assistance for infrastructure, health, education, and energy projects in Myanmar.
• India’s Border Area Development Programme (BADP) focuses on economic and social development in Myanmar’s border regions.
• India supports capacity-building initiatives through scholarships, skill development programs, and training for Myanmar’s civil servants.
Challenges in Bilateral Relations
• Political Instability: The 2021 military coup led to internal unrest, impacting India’s engagement strategy.
• Border Management Issues: Illegal immigration, drug trafficking, and arms smuggling remain concerns.
• China’s Expanding Influence: China’s Belt and Road Initiative (BRI) projects in Myanmar create challenges for India’s regional outreach.
India-Myanmar relations are crucial for regional stability, economic growth, and connectivity with Southeast Asia. While challenges exist, India’s balanced approach of engagement with all stakeholders, economic investments, and security cooperation will shape the future of this strategic partnership.
Prelims Practice Question:
Q. Consider the following statements regarding India-Myanmar relations:

1. Myanmar shares a land border with only three Indian states.
2. The Kaladan Multi-Modal Transit Transport Project aims to connect India’s Northeast with Myanmar’s Sittwe port.
3. Myanmar is a part of the India-Myanmar-Thailand Trilateral Highway project.
4. The recently launched Rupee-Kyat Trade Settlement Mechanism aims to facilitate bilateral trade between India and Myanmar.
   Which of the above statements are correct?
   (A) 1 and 2 only
   (B) 2, 3, and 4 only
   (C) 1, 3, and 4 only
   (D) 1, 2, 3, and 4
   Answer:
   Correct Option: (B) 2, 3, and 4 only
   Explanation:
5. Incorrect – Myanmar shares a land border with four Indian states: Arunachal Pradesh, Nagaland, Manipur, and Mizoram (not three).
6. Correct – The Kaladan Multi-Modal Transit Transport Project aims to connect India’s Northeast (via Mizoram) with Myanmar’s Sittwe port for enhanced trade and connectivity.
7. Correct – Myanmar is a key participant in the India-Myanmar-Thailand Trilateral Highway, which seeks to improve road connectivity between South and Southeast Asia.
8. Correct – The Rupee-Kyat Trade Settlement Mechanism was recently introduced to reduce dependence on the US dollar and facilitate trade between India and Myanmar.
   Thus, the correct answer is (B) 2, 3, and 4 only.
   Mains Model Question ;
   Q. Analyze the significance of India-Myanmar bilateral relations in the context of regional geopolitics, economic cooperation, and security dynamics. What are the major challenges in the relationship, and how can they be addressed?
   India-Myanmar relations are shaped by historical, cultural, and strategic factors. Myanmar serves as a gateway to Southeast Asia, making it crucial for India’s Act East Policy. The relationship is guided by principles of non-interference, mutual respect, and economic cooperation.
   Significance of India-Myanmar Relations
9. Geopolitical Importance
   • Myanmar connects South Asia and Southeast Asia, making it central to India’s regional ambitions.
   • It plays a role in counterbalancing China’s influence, particularly in the context of China’s Belt and Road Initiative (BRI).
10. Security Cooperation
    • India and Myanmar share a 1,643 km border, affecting India’s Northeast insurgency dynamics.

• The 2019 Bilateral Border Agreement allows coordinated military operations against insurgents.
• Joint efforts are required to combat illegal migration, drug trafficking, and arms smuggling.

3. Economic and Connectivity Cooperation
   • Myanmar is a partner in India’s Act East Policy and Neighborhood First Policy.
   • Key projects include:
   o Kaladan Multi-Modal Transit Transport Project (connecting India’s Northeast to the Bay of Bengal).
   o India-Myanmar-Thailand Trilateral Highway (enhancing trade and people-to-people connectivity).
   o Rupee-Kyat Trade Settlement Mechanism (reducing dependence on the US dollar).
   • Myanmar is a source of oil, natural gas, and minerals, contributing to India’s energy security.
   Challenges in the Relationship
   • Political Instability: The 2021 military coup disrupted India-Myanmar engagement.
   • China’s Expanding Influence: Myanmar’s dependence on Chinese investments threatens India’s strategic interests.
   • Border Issues: Insurgency, smuggling, and illegal migration remain concerns.
   • Slow Project Implementation: Connectivity projects face delays due to infrastructure and policy challenges.
   • Strengthen security cooperation through institutionalized mechanisms.
   • Accelerate connectivity projects to enhance trade and regional integration.
   • Expand developmental and capacity-building initiatives to counterbalance China’s influence.
   • Maintain diplomatic engagement with both Myanmar’s civilian and military leadership to ensure stable relations.
   Conclusion
   India-Myanmar relations are critical for regional security, trade, and connectivity. Addressing existing challenges through strategic diplomacy, economic cooperation, and infrastructure development will strengthen bilateral ties and support India’s regional objectives.