Article

Federalism and Foreign Policy India Quarterly

72(3) 216–234
in India—Experiences of UPA © 2016 Indian Council
of World Affairs (ICWA)
and NDA-II Regimes SAGE Publications
sagepub.in/home.nav
DOI: 10.1177/0974928416654367
http://iqq.sagepub.com

Partha Pratim Basu1

Abstract
This article, set in the tradition of analysing the domestic inputs to foreign policy, explores the inter-
face of federalism and the making and execution of foreign policy in India by looking at six case studies
drawn from the United Progressive Alliance UPA (2004–2014) and the National Democratic Alliance
NDA-II (2014 onwards) periods. Although the Indian Constitution has vested the power to conduct
foreign policy almost exclusively in the Union government, serious differences between the two layers
of government in the Indian federation have never been unknown altogether. However, it is argued
here that the twin developments of the 1990s, that is, rise of coalition governments at the central level
and introduction of neoliberal reforms in the Indian economy, enabled States to deepen their foot-
prints in the foreign policy arena. In conclusion, the article attempts a comparison of the two regimes’
performances in handling the issues concerned and asserts that instead of depending on ad hoc political
management skills, these developments should be addressed through devising some new mechanism to
achieve effective consultations between the Centre and the States on the foreign policy front.

Keywords
India’s foreign policy, domestic factors of foreign policy, federalism and foreign policy, Teesta water
deal, Indo-Bangladesh Land Boundary Agreement, Make in India

Foreign policy analysis conventionally focused on factors external to a state for understanding its foreign
policy behaviour. However, a new crop of literature came up since 1950s and 1960s which sought to turn
the searchlight within and inquire into the domestic foundation of foreign policy. If Gabriel Almond’s
(1960) The American People and Foreign Policy constituted one of the earliest landmarks in this tradi-
tion of inquiry, James Rosenau’s (1967) Domestic Sources of Foreign Policy undoubtedly contained one
of its most comprehensive statements. While these early explorations into the domestic roots of foreign
policy posed a theoretical challenge to the orthodox realist take on the process of foreign policymaking

1
Department of International Relations, Jadavpur University, Kolkata, West Bengal, India.

Corresponding author:
Partha Pratim Basu, Department of International Relations, Jadavpur University, Kolkata 700032, West Bengal, India.
E-mail: parthapratimbose@yahoo.co.in; ppbasu@ir.jdvu.ac.in
Basu 217

(often referred to as the ‘billiard ball model’), more recently, the neoclassical realists have sought to
accommodate the kernel of this argument within the realist framework of foreign policy analysis.
As Gideon Rose observed, these neoclassical realists sought to differentiate their position from that of
the Innenpolitics school, on the one hand, which prioritised the domestic influences and contended that
foreign policy is best understood as the result of a country’s internal dynamics, and of the offensive/
aggressive realists, on the other, for whom a state’s foreign policy is driven predominantly by its place
in the international system (of states) and especially by its relative material power capabilities. The neo-
classical realists sought to incorporate both internal and external variables: True to the realist tradition,
they attached primacy to the systemic determinants but also acknowledged that foreign policy choices
are made by actual political leaders whose perceptions of relative power matter considerably; moreover,
their freedom to extract and direct national resources is also constrained by the strength of states vis-à-
vis their societies. Hence, to understand the way states interpret and respond to the external environment,
it was imperative on the student of foreign policy to analyse how systemic pressures are translated
through unit-level intervening variables such as decision-makers’ perceptions and domestic state struc-
tures (Rose, 1998, pp. 144–172).
Analysis of the domestic dimension of foreign policy has been undertaken in the Indian context by
Bandyopadhyaya (1979), Appadorai (1981), Tharoor (1982), Kapur (1994), Jha (2002), among others.
The first four volumes covered (a) the basic determinants, for example, tradition, history and the social
milieu (Appadorai), geographical location, military capabilities (Bandyopadhyaya), level of economic
development and political structures including the democratic framework (Bandyopadhyaya and
Appadorai) and the federal design (Appadorai); (b) political institutions with special reference to the role
of the cabinet, parliament, ministry of external affairs, prime minister’s office, pressure groups, public
opinion and the press (Bandyopadhyaya, Tharoor and Kapur); and (c) role of personalities, especially
prime ministers (Appadorai, Bandyopadhyaya, Tharoor and Kapur). Jha, finally, sought to capture
the evolution of India’s foreign policy between 1960s and the beginning of the new century through the
prism of a theoretical framework he developed for studying the domestic imperatives of foreign policy.
The present attempt to examine the connect between federalism and foreign policy in contemporary
India takes this particular body of foreign policy studies as its point of departure.
Federalism by definition is marked by a constitutionally sanctioned distribution of powers between
two sets of governments, one located at the central level and the other at the level of the federated units.
However, this power-sharing arrangement pertains largely to domestic matters while decisions regarding
foreign policy usually remain the exclusive preserve of the federal government. Yet, a new-found asser-
tiveness on the part of the States in India1 vis-à-vis foreign policy decision-making is increasingly attract-
ing public attention as is evident in the postponement of the Teesta Water-sharing Accord with Bangladesh
through the intervention of the West Bengal government (2011), the stiff opposition put up by several
States to New Delhi’s move to invite foreign direct investment (FDI) in the multi-brand retail sector
(2012) or Dravida Munnetra Kazagham (DMK, a Tamil Nadu-based regional party) pulling out of the
United Progressive Alliance-II (UPA-II) coalition over the government of India’s (GoI) stance regarding
a US-sponsored resolution on Sri Lanka in the UN Human Rights Council (2013). It is true that all these
instances belonged to the tenure of the Manmohan Singh-led UPA government (which ruled uninterrupt-
edly between 2004 and 2014) and the successor National Democratic Alliance-II (NDA-II) government
which assumed office under Narendra Modi in 2014 witnessed notable instances of cooperation between
Union and State governments on some international issues, for example, the Indo-Bangladesh Land
Boundary Agreement (LBA) (2015) which the West Bengal government opposed earlier. Yet, the Teesta
issue still remained unresolved and, what is more, these examples of Union–State discord have generated
218 India Quarterly 72(3)

a distinct sense of discomfort and anxiety among many analysts of Indian foreign policy (see, for
example, Institute of Peace and Conflict Studies, 2014).
To be sure, these are no unique developments without precedents. Appadorai (1981, pp. 187–210)
noted that as early as in 1950s and 1960s when both Union- and State-level governments were domi-
nated by the Congress party, several States crossed swords with the Centre on foreign policy issues in
which they were found to have serious stakes. However, this article argues that two developments since
1990s—formation of successive coalition governments at the Centre which ascribed a national
policymaking role to the regional political parties as partners in these coalitions and the onset of eco-
nomic liberalisation leading to an enlargement of the ‘economic sovereignty’ of the States—deeply
impacted the character of federalism in India and set the stage for recurrent and self-assured intervention
by State governments (often headed by regional parties) in the field of foreign affairs. A further submis-
sion is that this shift in the nature of Indian federalism has come to stay, hence even after the Bharatiya
Janata Party (BJP) managed to secure a single majority in the 2014 Lok Sabha polls after nearly a decade
and a half, foreign policy decisions on many occasions continued to remain captive to an intricate
interplay of the interests of the Union and State governments.
This article begins with a brief account of the constitutional position regarding foreign policymaking
in India which clearly gives an upper hand to the union government over the States; next, it elaborates
how economic liberalisation and extension of the coalition experiment from State to the Central level
affected the dynamics of Indian federalism and especially expanded the role of the States in the domain
of foreign policymaking; the third section undertakes six case studies from UPA (2004–2014) and
NDA-II (2014 till date) regimes to illustrate these arguments. The concluding section undertakes a com-
parison of the performances of UPA and NDA-II regimes in tackling the challenges posed by States/
regional parties and ends with a plea for forging a mechanism to foster consultation between the Centre
and the States on foreign policy issues that affect the interests of the latter.

The Constitutional Imperatives

The Indian Constitution, in keeping with its original federal character with a pronounced centralised
thrust, acknowledged the unilateral supremacy of the union government in matters pertaining to the
conduct of foreign relations. Thus, according to Article 51 of the Constitution which forms part of
the Directive Principles of State Policy, the State shall endeavour to (a) promote international peace
and security; (b) maintain just and honourable relations between nations; (c) foster respect for interna-
tional law and treaty obligations in dealings of organised peoples with one another; and (d) encourage
settlement of international disputes by arbitration.
Further, the Union List vide its entries 10–21 empowers the union to exclusively deal with virtually
all conceivable aspects of foreign relations including diplomatic, consular and trade representation;
engagement with the United Nations; participation in international conferences, associations and other
bodies and implementing of decisions made thereat; entering into treaties and agreements with foreign
countries and executing of treaties, agreements and conventions with foreign countries; conduct of war
and conclusion of peace and so forth.
Finally, three provisions of the Constitution (Arvind Gupta, 2013) assign full powers to the Federal
government matching its responsibilities in the field of foreign policy: First, the Parliament has the
power to make any law for the whole or any part of the territory of India for implementing any treaty,
agreement or convention with any country (Article 253); second, the union has full executive powers for
Basu 219

the implementation of its laws, treaties and agreements (Article 73); third, to prevent the States from
obstructing the administration of laws by the Union, the executive powers of the States are to be so exer-
cised as not to impede or prejudice the exercise of the executive power of the union (Article 257).
Thus, the Constitution unambiguously asserts that the union government has the first and last word in
matters of foreign policy and any possibility of the ‘anaemic states to ever think of poaching on the
Centre’s monopoly’ in this regard has been effectively ruled out (Chatterji, 2014). It may be recalled in
this connection that some members during the debates in the Constituent Assembly felt that entrusting
the central government alone with treaty-making powers would amount to encroaching on the legislative
domain of the States as spelt out in the State List and pleaded for seeking concurrence of the States
before any international agreement was reached. K. M. Munshi, for example, built up a strong case for
discussing these issues on the floor of the Rajya Sabha which represented the States as he maintained:

[B]efore a decision is implemented it will come before the Central Legislature; that Legislature will
fully debate upon it; and it will then decide whether it will implement that decision or not. It is not going
to be taken behind the back of the representatives of any member of the Union; it means not only the
Lower House but the Upper House as well as the States—will have the right to vote upon it and bring to
bear upon it the influence of an all-India opinion. (Nanda, 2014, p. 6)

But this suggestion was brushed aside and the members agreed that the Union’s international persona
should have clear primacy. As Gopalaswamy Aayangar forcefully contended:

[B]ut we have got to remember that we go to these Conferences representing India as a whole, i.e. the
Federation and the Units combined, and if we are empowered to subscribe to the decisions arrived at
those Conferences, it is only right that we should be in a position to implement those decisions which we
agree at those Conferences. It is no use our assenting to such decisions and coming back Home to find
that we at the Centre are unable to implement them, but have to remit those decisions to the various units
for the purpose of arriving at their own decisions in regard to such matters and either implementing those
decisions or refraining from implementing them. (Nanda, 2014, p. 7)

This position, it may be noted in passing, was at clear variance with the constitutional requirements
in the United States or Australia where legislative approval of all international agreements which their
governments arrived at was mandatory.

Changing Face of Federal Relations and Implications for Foreign Policy

The process of centralisation in India’s federal experiment in general, not to speak of the area of foreign
policymaking, peaked during Mrs Indira Gandhi’s rule, especially during her second tenure (1980–1985)
and perhaps found its most visible manifestation in the successive dismissals of State governments
during the early 1980s. This, in turn, elicited a resolute response from the States in the form of several
conclaves held by the non-Congress opposition parties, proliferation of regional outfits which were
voted into power in more and more States, clamour for a review of Centre–State relations which forced
the government’s hands to appoint the Sarkaria Commission and so forth. Yet, the demands remained
confined to the opposition seeking a broader political space or wider financial powers and did not include
a greater say in foreign policy matters (Chatterji, 2014).
The turning point, however, came in 1990s with the collapse of one-party rule at the Centre and
rise of coalition politics, that is, one major party forming government with support from several smaller
220 India Quarterly 72(3)

parties, which marked replication on an all-India scale of an experience so far limited to the States (Jha,
2004, pp. 306–307). The chain began with the V. P. Singh-led National Front government of 1989–1990;
and while the Narasimha Rao government (1991–1996) restored a semblance of one-party domination,
it lacked single majority and had to depend on lesser partners for survival. This was
followed by four consecutive coalition regimes: the United Front (1996–1997); the NDA (1998–2004, in
two phases); UPA-I (2004–2009) and UPA-II (2009–2014). More important from our perspective,
however, was participation of State-based regional parties (National Conference, Shiromani Akali Dal
(SAD), Samajwadi Party (SP), Rashtriya Janata Dal, Asom Gana Parishad, Trinamool Congress (TMC),
Shiv Sena, DMK and All India Anna Dravida Munnetra Kazagham (AIADMK), to which one could also
perhaps add the left parties such as the Communist Party of India–Marxist and Communist Party of
India) in national-level coalition governments. This accorded them a greater voice not only in making
national policies but also in influencing foreign policy which introduced novel elements both in its
style and substance.2
Apart from coalition politics, 1990s also heralded the era of economic liberalisation which not only
brought about perceptible shifts in the character of Indian federalism but had significant ramifications
for foreign policy as well. With the marked decline in public investment and loss of its financial leverage
in the wake of the severe economic crisis of 1989–1990, the union government no longer had the
resources to finance large projects on its own especially when further borrowing was constrained by
huge deficits both domestic and international. This resulted arguably in a transition from a command
economy to a ‘federal market economy’, to borrow the expression of Rudolph and Rudolph (2001),
where the States enjoyed a higher share of economic sovereignty compared to the era of economic plan-
ning. It encouraged them to engage in more autonomous negotiations with foreign governments, inter-
national financial institutions and multinational corporations which enabled them to leave deeper
footprints in the arena of foreign affairs as well. Grabbing these new-found opportunities, the State
governments began vying for the attention of investors both foreign and domestic. State chief ministers,
finance ministers and finance/industry secretaries undertook frequent trips abroad showcasing the pro-
ductive possibilities of respective States and announcing policy concessions of various sorts. These
efforts, of course, produced mixed results: the marked success attained by Andhra Pradesh under
Chandrababu Naidu, Karnataka under S. M. Krishna or Gujarat under Narendra Modi as chief minister
was tempered by a ‘race to the bottom’ by some other States which, lacking in such strengths as good
infrastructure, skilled workforce and sound work culture to publicise, had to depend primarily on
announcement of concessions (and foregoing revenue in the process) to remain competitive which
instead of bringing the desired results at times spelt doom for their economies (Rudolph & Rudolph,
2001, p. 1546).
These twin developments—political decentralisation through national-level coalition politics and
economic decentralisation entailed by the paradigm shift in India’s economic policy—it has been argued,
ushered in remarkable changes in the character of Indian federalism. More importantly for us, this switch
towards a more competitive and accommodative federal arrangement had reverberations in the foreign
policy sector as well which is sought to be captured next through a series of case studies drawn from UPA
and NDA periods. These case studies may be classified under three heads: political (the ‘Tamil Nadu
factor’ in India’s Sri Lanka policy and the LBA with Bangladesh), economic (the POSCO Deal in Odisha,
the issue of FDI in multibrand retail and the land acquisition constraint on the ‘Make in India’ initiative)
and resource-related (the Teesta water deal and the Indus Water Treaty). These distinctions are of course
analytical as politics undoubtedly remained a major focus in all these issues—only the power game
found a more direct and unalloyed expression in the first two cases while in the second set, it found an
economic pivot and in the third cluster, it hovered around sharing of international (water) resources.
Basu 221

Case Studies

‘Tamil Nadu Factor’ vis-à-vis India’s Sri Lanka Policy

The Tamil Nadu factor in India’s Sri Lanka policy which found early expression immediately after inde-
pendence in the context of disenfranchisement of the ‘Indian Tamil’ population of Sri Lanka (then
Ceylon) and generated a fervent reaction in the State of Tamil Nadu (then Madras) kept on impinging on
India’s foreign policy even in the coalition era. Thus, by the end of the twentieth century, when the
BJP-led NDA-I government under Atal Bihari Vajpayee took charge in New Delhi, the Tamil cause in
Sri Lanka had been hijacked by the Liberation Tigers of Tamil Eelam (LTTE) militants demanding a
Tamil Eelam (an independent Tamil State) in the north and east of the country which pushed the island
nation into the vortex of a protracted and bloody civil war. The Sri Lankan army suffered a defeat
at Elephant Pass in LTTE hands in the summer of 2000 and the Indian government’s reaction was
measured: it immediately offered humanitarian aid but, in keeping with its avowed preference for a
policy of finding a solution to the Tamil problem within the framework of a united Sri Lanka, it also
maintained that it was open to dispatching arms if Colombo made a request to that effect. However, it
developed signs of vacillation once M. Karunanidhi, leader of DMK (then a constituent in the ruling
coalition) and chief minister of Tamil Nadu, visited New Delhi with a team of Tamil politicians and
asserted that they could not afford to allow any government of which they were a part to do anything that
would directly or indirectly take Tamil lives. This demand, evidently an outcome of competitive
populism among Tamil parties each of which sought to pose as the most ardent champion of the Tamil
cause in Sri Lanka, compelled Prime Minister Vajpayee to convene an all-party meeting to evolve a
new consensus on India’s Sri Lanka policy. During this conference, however, the Tamil parties’ advocacy
of secession in a foreign country came under fire not only from opposition parties but other NDA
partners as well (Jha, 2004, pp. 318–319) and the matter ended there.
The Tamil issue came up again during the UPA-I regime when Mahinda Rajapaksa’s nationalist gov-
ernment in Sri Lanka, bent on seeking a military solution to the problem even in the face of stiff resist-
ance by LTTE, finally liquidated the group and killed its supreme leader Pirabhakaran in 2008. An even
more aggressive Karunanidhi, now partnering the new government, urged GoI to demand a ceasefire in
the island, next pressed for snapping its ties with Sri Lanka and ultimately threatened to review his
party’s support for the coalition if New Delhi failed to find a solution to the problem. To step up pressure,
he exhorted all Members of Parliament (MPs) from Tamil Nadu to resign their posts and Kanimozhi, his
daughter, was the first to tender her resignation followed by several other DMK MPs. Prime Minister
Singh spoke to Karunanidhi to pacify him, and the Sri Lankan High Commissioner was summoned by
the National Security Advisor M. K. Narayanan to express India’s grave concern and unhappiness. This
was followed by a visit by Basil Rajapaksa, brother and senior advisor to the Sri Lankan president who
while responding to India’s concerns gave assurances that the safety and well-being of the Tamil com-
munity in Sri Lanka was being taken care of and that Colombo would facilitate the delivery of the sup-
plies to be dispatched by New Delhi for the affected civilian Tamil population. However, both sides
expressed their determination to crush terrorism which implied that the Sri Lankan government’s
military operations against the LTTE would continue unabated and goaded Karunanidhi to undertake
an indefinite fast demanding a ceasefire in Sri Lanka. This compelled GoI to prod its Sri Lankan coun-
terpart for suspension of hostilities and assert that although it had no sympathy for a terrorist organisation
such as LTTE, it firmly believed that a military solution to Sri Lanka’s ethnic problem was not viable and
meaningful political alternatives should be explored (Jha, 2012).
222 India Quarterly 72(3)

Nevertheless, the Rajapaksa government’s resolve to put down the LTTE rebellion with an iron hand
attracted charges of gross violation of human rights in international forums and a US-backed resolution
was moved in the UN Human Rights Council (UNHRC) in 2012 to force improvement in Colombo’s
human rights record. The second UPA government was found to vote in favour of this resolution in a
departure from India’s longstanding practice of not voting for country-specific motions apparently to
placate the DMK, still its coalition partner. The following year in the absence of the desired impact of the
previous resolution Washington brought a stronger resolution and DMK this time demanded that New
Delhi should not only support it but actually amend it, accusing Colombo of genocide and war crime.
DMK’s shrill pitch was not only meant to upstage the ruling AIADMK, its perennial rival in Tamil Nadu
politics in its display of pro-Tamil sentiment,3 but also to respond to the pervasive sense of revulsion that
gripped the State in the wake of the release of a film footage depicting the killing of the LTTE supremo’s
minor son evidently by Sri Lankan soldiers. However, no consensus was reached in parliament regarding
the appropriate response on the part of GoI, although a series of statements denouncing the Sri Lankan
government’s atrocities against the Tamils came from a host of ministers as well as from the UPA chair-
person Sonia Gandhi. But this failed to satisfy DMK which chose to pull out of the government in
March 2013 without, however, destabilising the UPA-II alliance. Curiously enough, the Indian repre-
sentative, undoubtedly on the basis of instructions from higher authorities, sought to toughen the
resolution, although this last-ditch effort failed to produce the desired effect. On the contrary, this move
badly damaged India–Sri Lanka bilateral ties because if in 2012 Colombo’s fury was directed against
Washington in particular, in 2013, its ire was vented primarily against New Delhi (Schaffer & Schaffer,
2013; Times of India, 21 March 2013). It would be interesting to note that when a similar resolution was
again put to vote in UNHRC in 2014, India abstained—after all, following the withdrawal of the DMK,
the UPA government had nothing to lose domestically; hence perhaps it took this opportunity to mend
India’s strained relations with the island state (Kumar, 27 May 2014; The Hindu, 4 April 2014).
Thus, Tamil Nadu’s avid response to the Sri Lankan Tamil question stemming from the keen competi-
tion among the State’s political parties with each posing as the staunchest defender of Tamil cause in
Sri Lanka, a highly emotive issue for its inhabitants, arguably constituted the most persistent State-
level issue impacting India’s foreign policy concerns (see also Appadorai, 1981, pp. 207–210; Muni,
1993). The union government, as noted above, both during NDA-I and UPA times, was repeatedly
subjected to palpable pressure tactics and went out of its way to keep its coalition partner from Tamil
Nadu in good humour on all three occasions surveyed here. Yet, the apple cart was never really upset:
DMK’s clamour for GoI supporting a secessionist outfit in Sri Lanka in violation of its longstanding
policy course was roundly condemned in the all-party meeting in 2000; similarly, withdrawal of DMK
support in 2013 in connection with GoI dithering over the US-sponsored anti-Sri Lanka resolution in
UNHRC did not really threaten the UPA-II government. The somewhat greater concessions made by
New Delhi to the Tamil parties’ demands in 2008 perhaps had to be accounted for in terms of the strong
emotional upheaval created in the Indian State by the Rajapaksa government’s show of dogged determi-
nation to ruthlessly crush Tamil resistance in Sri Lanka through military means.

Indo-Bangladesh Land Boundary Agreement

The LBA with Bangladesh, hanging fire since 1970s which the UPA government failed to clinch despite
serious efforts, was finally signed in June 2015. This agreement first and foremost settled the longstand-
ing boundary disputes between the two neighbours involving the States of Tripura, Assam, Meghalaya,
Mizoram and West Bengal. Moreover, it also resolved the ‘enclave issue’ between the two countries with
Basu 223

notional transfer of 111 Indian enclaves to Bangladesh and 51 Bangladeshi enclaves to India. As a result,
the residents of these enclaves who have effectively remained stateless so far were to receive full-fledged
citizenship rights from the respective governments. This apart, the Agreement was also expected to yield
substantial benefits in terms of security, connectivity and strategic advantages (Bagchi, 7 June 2015).
The Indo-Bangladesh LBA was signed between Prime Minister Indira Gandhi and President Mujibur
Rahman in 1974 and Bangladesh’s parliament ratified it in the same year. But a bottleneck developed on
the Indian side since the deal involved land swap between Indian States of Assam, Meghalaya, Tripura,
West Bengal on one hand and Dhaka, Khulna, Rajshahi, Rangpur, Sylhet and Chittagong in Bangladesh
on the other. The attempt of the UPA government which signed a boundary protocol with Bangladesh in
2011 to introduce the 119 Constitution Amendment Bill in the Lok Sabha two years later to give effect
to the LBA invited stiff opposition from the West Bengal Government and the North East MPs Forum
(Natrajan, 26 March 2015). Mamata Banerjee, the chief minister of West Bengal, asserted that transfer
of nearly 17,000 acres of land West Bengal was supposed to part with under the agreement in return for
only about 7,000 acres of land from Bangladesh was not acceptable without due consultation with the
affected people. She made it clear that while having friendly ties with Bangladesh was important, it
should not come at the cost of the interests of the people of West Bengal (Business Standard, 14 August
2013 followed by Similar sentiments were voiced by Asom Gana Parishad in Assam, Khasi Students’
Union in Meghalaya and several other political outfits from Tripura and Mizoram. The BJP too, under
pressure from its Assam unit, sought to prevent the bill being tabled and its spokesperson Arun Jaitley
went to the extent of invoking the Keshavanada Bharati judgment (1973) in which the Supreme Court
precluded the parliament from amending the basic structure of the Constitution and argued that territory
of India was a part of the Constitution which could not be reduced or altered by a constitutional amend-
ment (Kashyap, 6 May 2015; Raja Mohan, 2014; The Hindu, 4 April 2014).
After the NDA government assumed power in 2014, Prime Minister Modi made ‘neighbourhood first’
a major plank of his foreign policy and cultivating better relations with Bangladesh along with other
South Asian states was accorded top priority. This led him to deal with domestic opposition to the pro-
posed Constitution Amendment Bill, especially from Mamata Banerjee’s TMC and also from within his
own party. The TMC supremo finally agreed to support the agreement on condition of receiving a sub-
stantial financial package for rehabilitation and resettlement of the people expected to come over to West
Bengal once the process of exchange of enclaves was completed. The shift in her stance, some commen-
tators pointed out, was also influenced by the multi-crore Saradha chit fund scam which had her party in
deep trouble, the BJP making political inroads into West Bengal (due to go to polls in 2016) and posing
a challenge to the ruling party in addition to the leftists and, finally, the unearthing of a terror plot in
the State reportedly targeting the Sheikh Hasina regime in Bangladesh in October 2014 which caused
considerable embarrassment for the West Bengal government (The Indian Express, 7 May 2015; Roche,
12 May 2015).
A bigger challenge for Prime Minister Modi was to tackle resistance to the accord from within his
own party ranks, especially its Assam chapter. Bangladesh remains a sensitive issue in the politics of
Assam: The All Assam Students’ Union (AASU) movement of 1979–1985 was directed primarily against
alleged illegal immigrants crossing over from Bangladesh and no political party in the State—least of all
BJP which had a sturdy nationalist image—was prepared to imperil its electoral fortunes by supporting
a treaty which involved transfer of territory to Bangladesh. Under the circumstances, Modi sought to
convince his party workers that his government would use the land transfer agreement in a manner that
might seem to be an immediate loss to Assam but would serve the security interests of the State in the
long run and settle the illegal immigration issue once and for all. The Bangladeshi enclaves in India are
224 India Quarterly 72(3)

majorly in West Bengal while Assam has only one ‘sector’—a 2.86-km stretch in the Lathitilla–Dumabari
sector in Karimganj district—and if the border is demarcated, so went the argument, this sector can
be effectively fenced off to stem illegal migration (Talukdar, 30 November 2014).
Although this plea helped the Modi government to finally clinch the LBA, Assam BJP remained far
from reconciled with the official position. Indeed, they favoured conclusion of the agreement excluding
Assam from the process and the government also at one point of time made an announcement to this
effect. However, vehement objection raised by Tarun Gogoi, the Congress chief minister of the State, and
the displeasure voiced by the Awami League government of Bangladesh finally led New Delhi to reverse
that decision (Haider, 5 May 2015). Meanwhile, differences also cropped up between the West Bengal
government and the Modi regime over the size of the rehabilitation package promised by the Centre. The
latter sought to scale down the package because the number of people actually likely to cross over to and
settle in West Bengal was calculated to be much less than previous estimates but the Mamata Banerjee
government resented this decision as a deviation from the union government’s earlier commitment
(Nagchoudhury, 8 June 2015).
It follows therefore that the resistance to LBA was closely related to the question of land alienation,
a highly sensitive issue in partition-scarred Bengal and Assam States with the concern over alleged
illegal migration from Bangladesh constituting yet another irritant especially for Assam—issues which
provided ready fodder for partisan contest. The accord, on the contrary, was finally clinched partly
through the political dexterity displayed by Prime Minister Modi (his handling of the impediments in
Assam may be recalled) and partly through the twists and turns in the political fortunes of the West
Bengal government in 2014–2015. The agreement, however, left a bitter aftertaste particularly in the
Assam unit of BJP.

Tussles over FDI: POSCO and Multi-brand Retail under UPA

Our case studies with an economic content drawn from both UPA and NDA regimes had the issue of FDI
at their core, although each of the three instances—two from the UPA days and one from the NDA
period—involved divergent political ramifications. The first case related to the memorandum of under-
standing (MoU) the State of Odisha concluded with the Korean conglomerate POSCO in 2005 to
construct a $12.6 billion (the biggest FDI deal till then) integrated plant to manufacture steel, mine iron
ore and build the necessary infrastructure for constructing a port in Odisha. The Odisha government
promised to be a partner in the process and committed to provide/acquire requisite land and also to
arrange necessary supplies and infrastructure for steel production in tandem with GoI. The project,
however, got mired in controversy after the enactment of the Forest Rights Act in 2007 as it was sup-
posed to be retroactively brought under the purview of the law for alleged violations of environmental
regulations. Although the Supreme Court’s verdict initially went in favour of the project, the Ministry of
Environment on the basis of the findings of a Committee appointed by it issued a work stoppage order
in 2010. After a second committee looking into the viability of the project gave a split verdict later that
year, the order was revoked and final clearance was issued in 2011, subject to the State of Odisha and
Posco-India meeting some 60 additional conditions. However, the project was further delayed due to
legal wrangling and militant agitation, and it was only in 2014—after eight years of the signing of
the MoU—that it received the green signal through the intervention of the central government in the
backdrop of South Korean President Park Geun-Hye’s visit to New Delhi (Das, 5 March 2014; Times of
India, 10 January 2014). The POSCO case remained interesting insofar as it showcased an Indian State’s
Basu 225

desperate bid for FDI, the hallmark of the liberalisation era as well as the changing contours of Indian
federalism. The differences with a Congress-led union government apparently arose in connection with
the new environmental legislation, although it may also have had something to do with Odisha Chief
Minister Navin Patnaik’s cosy political ties with BJP.
We next turn to the proposal floated by the UPA-II government in 2012 for allowing 51 per cent FDI
in multi-brand retail which left the Indian States vertically split along party lines. Mooted in late 2011 in
order to breathe new life into the seemingly stalled process of economic reforms, it encountered strong
opposition from UPA ally TMC and several State governments. The Department of Industrial Policy and
Promotion wrote to governments of all States and Union Territories in June 2012 to elicit their views on
the contentious issue as it was in favour of leaving the final word with the State governments. Once again
the sharpest response came from West Bengal Chief Minister Mamata Banerjee, by then dissociated
from UPA, who asserted that reforms need not amount to ‘selling out everything’. On the contrary, Omar
Abdullah, who ran the Jammu and Kashmir government in alliance with Congress, congratulated the
Centre for leaving the final say with the States because ‘Why should Mamata (Banerjee) or (UP Chief
Minister) Akhilesh Yadav decide what is bad or good for J&K?’ In sum, the UPA-ruled States hailed it
as a ‘bold initiative’ which, as Lalu Prasad Yadav explained, would let the farmers get a fair price of their
produce, and the States having non-Congress governments assailed the measures as ‘anti-people’ as it
threatened massive job losses. Interestingly, SAD which governed Punjab with BJP as a junior partner
initially welcomed the move but later threw in its lot with the BJP-ruled States opposing it (News24Online,
2012; ZEEnews, 2012). Finally, after a prolonged stand-off, the issue had to be put to vote in the Lok
Sabha on BJP’s initiative which the UPA government convincingly won thanks to the walkout staged by
the SP and the Bahujan Samaj Party (BSP) alleging that the motion ignored the interests of the farmers
and small retailers (Rediff.Com., 2012). In any case, the Gordian knot in this instance appeared to have
been untied somewhat fortuitously, that is, through the positions adopted by SP and BSP during voting
in parliament ostensibly without any ‘understanding’ struck with the ruling regime. However, the bla-
tantly political nature of the divide among the States overlapping with their ruling parties’ coalition
allegiances (somewhat dramatically underlined by the shift in SAD’s stance)—seemingly oblivious of
serious consideration of the substance of the move—could hardly be overlooked.

NDA and ‘Make in India’

The Modi government launched its ambitious Make in India initiative in September 2014 to encour-
age—especially foreign—companies to manufacture in India, with the prime object of job creation and
skill enhancement by turning the country into a global manufacturing hub. Indeed Prime Minister Modi
made a strong pitch for the programme during all of his foreign visits—from the United States, France,
Germany to South Korea and Association of Southeast Asian Nations (ASEAN) countries. However,
acquisition of land for housing these new projects proved to be a major challenge and many of those
firms which came forward to invest in India had to drop such plans after a period of time (Nataraj &
Sekhani, 2015).
Land acquisition in independent India was long regulated by The Land Acquisition Act 1894 until the
UPA government passed the Right to Fair Compensation and Transparency in Land Acquisition,
Resettlement and Rehabilitation (LARR) Act in 2013 to repeal the nineteenth-century legislation. The
UPA act sought to ensure that land was acquired strictly for public welfare projects, an assessment of the
‘social impact’ of such acquisition was carried out in right earnest and land owners were adequately
226 India Quarterly 72(3)

compensated and rehabilitated. It proposed that for setting up private projects and for public–
private partnership (PPP) projects, land could be acquired only through the consent of 80 per cent and
70 per cent of the families affected, respectively. The compensation was fixed four times more and
two times more the market rate for rural and urban areas, respectively (Nataraj & Sekhani, 2015).
The BJP-led NDA government which came to power in 2014 showcasing its development agenda
undertook steps to introduce reforms in the land acquisition procedure. With a thrust on Make in India
and infrastructure development, the government introduced necessary amendments during the December
2014 session of the Lok Sabha. The Bill it moved identified five special categories of land use—defence,
rural infrastructure, affordable housing for poor, industrial corridors and PPP projects—where the central
government owned the land and exempted them from the LARR Act’s provisions of consent seeking and
social impact assessment in order to incentivise the Make in India initiative. Further, as compared to the
LARR Act which mentioned the acquisition of land for private companies, the law passed by the BJP
changed the nomenclature ‘private companies’ to ‘private entities’, which included companies, corpora-
tions as well as non-profit organisations, and also removed restrictions on acquisition of land for private
hospitals and educational institutes. But this version of the Bill tabled in Parliament encountered dour
resistance from both the opposition and BJP’s allies who termed it ‘anti-farmer’ and ‘anti-poor’ mainly
because of the removal of consent clause and social impact assessment, which made the passage of
the Bill difficult. The course of events was reversed, however, on 9 March 2015, when the Lok Sabha
gave a nod to the new land acquisition law following the introduction of nine amendments by the
government (Nataraj & Sekhani, 2015).
It is interesting to note the government’s strategy switch in dealing with this opposition which finally
helped it salvage the situation: initially it was adamant and sought to get its way through issue and exten-
sion of ordinances; the course correction, however, came with its decision to push the ball into the State
governments’ court. At National Institution for Transforming India (NITI) Aayog meeting to discuss the
land Bill, the prime minister lamented that politics over the Bill was stalling rural development which
was followed up Finance Minister Arun Jaitley’s observation after the meeting:

If the Centre fails to approve this (Bill) with consensus, it should be left to states. Those states that want to
develop fast (emphasis added) ... can suggest their own state legislation and the Centre (would) approve that state
legislation. An overwhelming section (of the States) gave such a suggestion.

Although he did not identify the specific States, it was evident that most of these were those ruled by
BJP or its alliance partners (Madhavan, 2015).
Telangana, ruled by the Telangana Rashtra Samithi (not an NDA partner), was understood to have
supported the changes, along with Haryana, Rajasthan, Madhya Pradesh, Chhattisgarh, Jharkhand,
Gujarat, Maharashtra and Goa. Chief Minister of Andhra Pradesh N. Chandrababu Naidu could not
attend the meeting but he had consistently supported the Bill and reportedly conveyed his assent to the
prime minister over phone. Among the States ruled by the NDA partners, Parkash Singh Badal, who led
a SAD–BJP government in Punjab, was the sole dissenter on the issue of diluting the 2013 Act while
Jammu and Kashmir chief minister Mufti Mohammad Sayeed advised the prime minister to consult all
political parties before amending the existing legislation. The nine Congress chief ministers on the con-
trary boycotted the meeting, while the Uttar Pradesh, West Bengal and Odisha chief ministers stayed
away. Tamil Nadu’s J. Jayalalitha (though absent in the meeting), Bihar’s Nitish Kumar, Tripura’s Manik
Sarkar and Delhi’s Arvind Kejriwal also opposed the amendments which completed the picture of a near-
perfect vertical political divide among the States (Mohan & Mukherjee, 2015).
Basu 227

This case in some ways looked like a repeat performance of the multi-brand retail controversy under
UPA because land acquisition constituted another holy cow in Indian electoral parlance. This perhaps
explained why SAD—avowedly representing the Jat farmers’ constituency in the State of Punjab—
chose to continue in its dissenting mode despite its State-level alliance with BJP. No less significant was
the Congress-led States’ show of unanimity in dissociating themselves from the bill piloted by the Modi
government which pointed towards yet another emerging feature of the contemporary Indian polity,
that is, the opposition’s proclivity to indiscriminately dispose whatever was proposed by the ruling
dispensation, a tendency which set in during the final years of UPA and lived on during the NDA-II
regime as well. But this instance was largely different in that the ‘resolution’—however fleeting it might
have been—bore the mark of deft political manoeuvring on the part of the ruling party drawing on the
coalition logic which reminded one of the LBA issue.

Teesta Water-sharing Deal

Of all the cases under consideration here, it was perhaps the blocking of the Teesta water-sharing Deal
with Bangladesh by the West Bengal government in September 2011 during the UPA II period that most
dramatically highlighted the coalition imperatives affecting foreign policy choices in recent times. After
the Sheikh Hasina government had assumed charge in Bangladesh in 2008, India–Bangladesh ties
improved perceptibly as Dhaka effectively addressed India’s vital and longstanding security concerns
and India reciprocated with the sanction of a $1 billion soft loan for improvement of port facilities in
Bangladesh in 2010. To give a further boost to bilateral relations, the two governments worked out a
package of agreements which among others included a proposal for division of the Teesta river waters
shared by the neighbours on the eve of Prime Minister Manmohan Singh’s visit to Bangladesh in
September 2011.4
However, Mamata Banerjee, the chief minister of West Bengal who was to accompany Singh on the
said trip (her party TMC was an ally of the UPA government till then), denounced the proposed treaty
about a week before the tour was to begin and opted out of the Indian delegation on the ground that her
government was not consulted on the proposed water-sharing arrangement which, she alleged, would
jeopardise the interests of the farmers of North Bengal. Her last moment decision almost scuttled the trip
to the great embarrassment of both sides and Singh indignantly mentioned in an interview that the
National Security Adviser, Shiv Shankar Menon, had been in constant touch with the West Bengal
government which had assented to the Teesta deal before backing out of it in the eleventh hour forcing
India to recoil from its international commitments (Swami, 2011).
The Teesta water-sharing agreement remained highly sensitive from Dhaka’s standpoint for experts
from Bangladesh claimed that the upper riparian India was channelling a large volume of water to meet
its irrigation needs through a barrage at Gazaldoba. As a result, Bangladesh maintained that its Teesta
Irrigation Project launched in 1980s suffered heavily and while the farmers had to bear the brunt, the
health of the river on the Bangladesh side has been at stake with its flow rendered grossly inadequate.
However, though Dhaka initially asked for a 50 per cent share of Teesta water, it later scaled down its
demand so that a feasible solution could be reached, and some movement on this issue was expected
during the meeting of the Indo-Bangladesh Joint River Commission scheduled for June 2013. But the
meeting had to be cancelled by New Delhi on receiving a letter from the West Bengal government stating
that its representatives could not attend due to panchayat (rural local government) polls, apart from
iterating that its position on Teesta accord had remained unchanged (Jayanta Gupta, 2013).
228 India Quarterly 72(3)

The issue has been hanging fire since then, although Mamata Banerjee attended the Language Day
ceremony in Dhaka in February 2015 on the invitation of the Sheikh Hasina government and assured that
she was about to undertake a review of the Teesta issue (Habib, 2015) which generated cautious
optimism on both sides of the border. Indeed, that a State chief minister’s trip was regarded by many as
the curtain-raiser to Prime Minister Narendra Modi’s impending maiden visit to India’s eastern neigh-
bour was in itself a telling commentary on the crucial importance India’s federated units and their leaders
are receiving in connection with India’s foreign policy in present times. However, Banerjee accompanied
Modi on his visit to Bangladesh in June 2015 during which several agreements were inked (including
the landmark LBA) but to Dhaka’s great dismay, no new announcement came regarding Teesta from the
West Bengal chief minister. Prime Minister Modi also restricted himself to saying that he was confident
that with the help of the State governments in India ‘we can reach a fair solution on the Teesta and
Feni rivers’ (Firstpost, 7 June 2015). The matter has been resting there ever since and the frustration
and disappointment suffered by Bangladesh were poignantly captured in the following words of a
commentator:

The presence of Mamata Banerjee alongside Modi had encouraged people to believe that, following what many
saw as a very successful visit by her to Dhaka earlier in the year, the heart of the West Bengal chief minister had
melted. But Banerjee remained uncharacteristically quiet on the matter, taciturn and brooding, during the entire
visit. So, instead of the much-needed Teesta waters, we have got another bucket full of promises and assurances
with which we will have to irrigate the water-hungry Teesta basin on our side. (Sobhan, 2015)

The Teesta water-sharing case stood out as an instance of the politics of natural resources, reflecting
a vital concern of the era of economic liberalisation when geoeconomics keenly contested the claims of
geopolitics as the fulcrum of international relations. The role of electoral considerations on both sides of
the frontier in complicating matters could not be overlooked either: Mamata Banerjee’s TMC with its
support base concentrated in southern Bengal and anxious to win over north Bengal voters presumably
regarded concessions to Bangladesh on Teesta water inimical to this objective. On the contrary, Sheikh
Hasina had to contend with persistent missives from her counterpart, Khaeda Zia of BNP backed by the
Islamist forces, that the delay in conclusion of the Teesta deal was a testimony to her government’s
failure to wrest reciprocal concessions from India against several important measures she had under-
taken earlier to address the critical security interests of the bigger neighbour. Lastly, coalition constraints
discernibly played a role early on during UPA period, but Modi’s decision to give a long rope to Chief
Minister Banerjee even after his party having secured absolute majority in the Lok Sabha seemed signifi-
cant. Indeed, it left one to wonder whether this posture stemmed from his proclaimed respect for States’
rights (a claim seriously undermined by his government’s recent decision to impose Article 356 in
Arunachal Pradesh and Uttarakhand) or the covert BJP–TMC entente the Congress and leftist parties
never tired of hinting at of late aimed at bailing the NDA government out in the Rajya Sabha where it did
not have the requisite numerical strength to negotiate the opposition’s challenge.

The Indus Waters Treaty and Kashmir

The last of our cases which points towards a somewhat neglected dimension of the Kashmir question and
has failed to attract the kind of media attention grabbed, for example, by the Teesta Water Deal, also
represents a neat interface of the ‘internal’ and the ‘international’. The Indus—which originates in the
Tibetan Plateau—along with its tributaries flows through the Indian State of Jammu and Kashmir before
Basu 229

entering Pakistan. Thus, the partition of the subcontinent in 1947 called for a division not simply of land
and people but also of waterways. The inevitable tensions over water sharing between the increasingly
‘distant’ neighbours during the first post-partition decade were sought to be addressed through the Indus
Waters Treaty (IWT) of 1961 which laid down that the three eastern rivers of the Indus system (Ravi,
Beas and Sutlej) were to cater to India’s needs; and three western rivers (Jhelum, Chenab and Indus)
were to meet Pakistan’s requirements. Moreover, since both Chenab and Jhelum, with high hydro-
potential, came out of Jammu and Kashmir, it was important to determine how India could use Chenab
and Jhelum waters without interfering with Pakistan’s right to these resources (Indus Water Treaty, 1960;
Noorani, 2002).
The treaty, according to many, constituted a rare instance of Indo-Pak cooperation as it survived the
wars of 1965 and 1971; and even when Pakistan raised objections regarding construction of the Salal
Dam by India on the Chenab in 1978 on the ground that the storage could be used for flooding the lower
riparian regions of Pakistan, India sought to accommodate this concern by changing the design of the
dam. Similarly, Islamabad protested against the Tulbul Navigation Project involving erection of a barrage
on the Jhelum in 1984 which in Pakistan’s perception could be used by India as a geostrategic weapon
to control the river’s flow and New Delhi in response chose to shelve the project on which bilateral talks
remained inconclusive till date. Serious differences cropped up, however, in 1990s in the wake of
New Delhi’s stepped-up drive to harness the abundant hydrological resources of Jammu and Kashmir
leading to construction of a series of hydropower projects in the State. This new burst of activity was
presumably occasioned by reignited insurgency in Kashmir in the late 1980s and the government banking
on putting across the message of development as an antidote, which in turn raised Islamabad’s hackles.
The 900 MW Balighar Hydel Power Project on the Chenab and 330 MW Kishanganga Hydroelectric
Project on the Jhelum became major objects of discord at the turn of the century (Singh, 2008, p. 15;
Sridhar, n.d., pp. 26–27).
This murky scenario got further complicated in the new millennium by repeated assertion in the
political, intellectual and media circles of Jammu and Kashmir that IWT was unfair to the State insofar
as its interests were not duly taken into consideration when New Delhi agreed to relinquish consump-
tive rights over the west-flowing rivers. The demand for electricity in the State has increased enormously
since the conclusion of treaty in 1960, not only in connection with domestic consumption but in
development of agriculture, industrialisation and employment generation as well; and to meet these bur-
geoning requirements, so went the argument, utilising these river resources was absolutely essential.
It was further contended that the State could exploit only a nominal percentage of its huge hydroelectric
power potential, thanks to several power projects being held up due to disputes with Pakistan under
IWT,5 and has to incur a massive expenditure on purchasing power from outside to meet the spiralling
demands. Moreover, since IWT has seriously restricted construction of storage reservoirs which could
ensure the provision of the requisite water flow, all power projects in the State were of the ‘run-of-
the-river’ variety which not only pushed up construction costs of projects but also undermined the
cost effectiveness of the power generated by them. No wonder, demands for scrapping IWT have
been raised off and on within the State assembly, cutting across party lines, implying that unless it
received appropriate attention from the union government, it might turn explosive in course of time
(Bukhari, 2013; Business Standard, 7 January 2014; Iqbal, 2012; Nazakat & Nengroo, 2012; Parvaiz,
2008; Swami, 2002).
Thus, our final case, apart from reflecting a critical concern for sharing of cross-border river resources
(somewhat akin to the previous one), also mirrored the post-liberalisation sentiment in that it drew our
attention to the demand for development paralleling the much-publicised clamour for azadi (indepen-
dence) in the trouble-ridden frontier State of India. More importantly, however, the State of Jammu and
230 India Quarterly 72(3)

Kashmir is presently ruled by a BJP–Peoples Democratic Party (PDP) coalition which involves a unique
political experiment comprising disparate political elements—BJP not only heading the union govern-
ment but also championing a peculiar brand of (Hindu) nationalism while PDP giving voice to a strand
of sub-nationalism rooted in the (Muslim-dominated) Kashmir valley—and the Indus waters issue, it
may be contended, is very likely to test the resilience of this regime representing a peculiar mix of
centrist and regionalist forces in near rather than distant future. After all, the ‘Agenda of Alliance’ final-
ised prior to the launch of the coalition government in 2015 reflected PDP’s insistence on transfer of
hydroelectric projects of National Hydroelectric Power Corporation (NHPC) to the State government
which, it urged, would bring tremendous goodwill for the union government in the valley, and it again
emerged as a tension area that strained the relations between the two partners in recent times (see Ganai,
2016; Iyer, 2015).

Conclusion
This article began with a reference to the literature on the domestic influences on foreign policy which
emerged in 1950s and 1960s as a challenge to the realist analysis (a standpoint later integrated by the
‘neoclassical’ realists into the realist tradition as well) and sought to examine the linkage between federal
politics and foreign policy in India through consideration of six case studies drawn from UPA-I and
UPA-II and NDA-II periods. The power to make foreign policy decisions has been vested by the Indian
Constitution almost unilaterally in the union government, a position which was further buttressed during
the early post-independence decades by the pervasive supremacy of the Congress party. But even in
those days, as has been noted, differences between the Centre and the States were not altogether absent,
although on most occasions, the views of the former were ultimately found to prevail. The scenario,
however, underwent a qualitative shift as the States, thanks to the twin developments of formation of
coalition governments at the union level and unleashing of the forces of economic liberalisation, became
more assertive in the domain of foreign policy, embarrassing the Centre or making it yield to regional
pressures on occasions.
All the instances considered here attested to our above assumptions. While some of the issues (such
as expression of Tamil ethnic sentiment in connection with Sri Lanka policy and the question of transfer
of land in the context of LBA) remained conventional in essence, others (e.g., POSCO, multi-brand-
retail, Make in India or river-resource sharing) carried the distinct stamp of the neoliberal era; and the
shadow of coalition imperatives was found to hang over each of the cases as these unfolded and, on some
occasions, got resolved. Comparison of the performances of the UPA (I and II) and NDA (II) govern-
ments—one having completed two five-year tenures and the other in office for less than two years so
far—might seem somewhat unfair. Still it may be tentatively argued that the Modi government has
exhibited greater political adroitness and manoeuvring skills in managing the problems at hand as was
borne out by our discussion of LBA and Make in India issues (though if and how the Teesta tangle is
going to be resolved by it in near future would be keenly watched by all). In comparison, the UPA
government apparently failed to display similar dexterity and innovativeness; and the problems, as a
result, either lingered for years (as in the case of the Teesta waters or the POSCO plant) or got resolved
despite the absence of any determined intervention on its part. Still UPA has to be given the benefit of
doubt as the Modi government enjoyed single majority (however slim) in the Lok Sabha which allowed
the prime minister, for example, to brush aside the reservations of Tamil parties regarding President
Rajapaksa or the regional parties of Maharashtra concerning Pakistan’s Prime Minister Nawaz Sharif
attending his swearing-in ceremony, an advantage the UPA government clearly lacked.
Basu 231

Turning to the overall significance of the growing activism of the States on the foreign policy front
and its long-term implications, it may of course be argued that interventions by States and regional
parties as evident from the case studies did not have any major impact on the overall approach of the
Centre to any particular foreign policy issue. They at best served as spoilers; the changes they managed
to force were marginal in nature and that too for a brief period due to coalition compulsions. Still this has
had its costs to India’s larger diplomatic and security interests, especially in relation to its neighbourhood
policy, the most critical instance perhaps being the stalled Teesta accord which proved to be a nagging
irritant on the otherwise upward-moving graph of Indo-Bangladesh relations for quite some time.
Similarly, the stubbornness exhibited by opposition State governments in the multi-brand retail or Make
in India cases also interfered with the implementation of key policy measures of the union government
which had long-term import for the country’s economic development.
It is true, as noted above, that on certain occasions, the roadblocks could be negotiated through adroit
political management; yet, it seems unwise to rely exclusively on ad hoc measures. Rather, as one com-
mentator contends (Chatterji, 2014), the government should take the initiative to develop a viable mech-
anism to facilitate consultation between the Centre and the States concerned. At the same time, while
States were taken on board and their grievances taken care of for decision-making purposes, this plat-
form should also be utilised for conveying the all-India view of the Centre from the perspective of the
country’s broader foreign policy interests and States should not be given a veto on decisions per se or in
the implementation of decisions. This needs to be ensured to preclude parochial interests or sheer cussed-
ness on the part of regional parties (even national parties were no exception as was evident during
parliamentary debates on the Indo-US Nuclear Deal or more recently, the Goods and Services Tax Bill)
from impudently holding Indian foreign policy to ransom.

Acknowledgement
The author would like to extend his thanks to an anonymous reviewer.

Notes
1. In this article, State (with a capital ‘S’) is being used to indicate the federal units in India.
2. While we shall look at the substance-related shifts in the course of this article, it may be noted here, following
N. K. Jha, that coalition politics impelled a departure from the India’s prime minister-centric model of foreign
policymaking as well. To take the example of the NDA (I) government, although Prime Minister Vajpayee took
keen interest in foreign policy and held the external affairs portfolio during the Janata regime (1977–1979),
the power to formulate and implement foreign policy was not necessarily concentrated in the Prime Minister’s
Office, rather his friend and confidante Jaswant Singh who was later given the charge of the foreign ministry acted
as a key player in foreign affairs and the prime minister’s trusted emissary even before his formal elevation.
Similarly, Principal Secretary Brajesh Mishra and Defence Minister (and also Samata Party leader) George
Fernandes too—in addition to Singh—played a significant role in the dialogue New Delhi held with western
countries in the aftermath of the Pokhran II blasts of 1998. This involvement of diverse functionaries in the policy
business at times created not a little embarrassment for the government. Thus, for example, Fernandes’s remark
that China was the prime target of the nuclear tests conducted by India in the summer of 1998 adversely affected
the process of normalisation of Sino-Indian ties and Jaswant Singh had to engage in a serious damage control
exercise during the ASEAN ministerial conference at Manila in July 1998 to mend fences between the two
neighbours (see Jha, 2004, pp. 309–317).
3. J. Jayalalitha, the chief minister of the AIADMK-led Chennai government enforced a ban on Sri Lankan players
participating in Indian Premier League matches in Chennai in March 2013 (see NDTV, 2013).
4. India and Bangladesh entered into an ad hoc agreement in 1983 over Teesta, a shared river, which stipulated
that 36 per cent of its water would go to Bangladesh while India’s share would consist of 39 per cent. Despite
232 India Quarterly 72(3)

several high level meetings, however, the agreement remained unimplemented until a draft Teesta water sharing
arrangement was proposed at the 37th meeting of the Joint Rivers Commission in 2010 to be signed during Prime
Minister Manmohan Singh’s Bangladesh trip in 2011. It maintained that India and Bangladesh would each get
40 per cent of the actual flow available at West Bengal’s Gazaldoba barrage while 20 per cent would be reserved
as environmental flow (see Strategic Foresight Group, 2013).
5. Indeed, part of the grievances was directed against New Delhi rather than Islamabad as well. While the IWT
allegedly crippled the overall potential of power generation in Jammu and Kashmir, the bulk of the power
actually generated, so ran the argument, remained a near monopoly of India’s National Hydroelectric Power
Corporation (NHPC) which paid a paltry amount to the State in terms of royalty. This, in turn, fuelled the
demand in certain circles that the State should secure recompense for its losses not only from Pakistan but GoI as
well (see Bukhari, 2013).

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