Narendra Modi's Visit: A New Era in Bangladesh-India Relations


From June 6-7, Prime Minister of India, Mr. Narendra Modi visited Dhaka, Bangladesh on a landmark two-days official visit. This visit was seen as a watershed moment for the already warm relations between the two neighbouring countries due to the recent passing of the Land Boundary Agreement (LBA) by the Indian Parliament and the promises for greater cooperation the visit held. None was disappointed as the two countries signed a number of agreements to further strengthen cooperation in a number of areas. Fruitful discussions were held in other areas of contention with the promises of resolution soon. This report summarizes the major developments made, and headways reached, during this very important visit.

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PM Narendra Modi recalled with deep respect the visionary leadership of the Father of the Nation Bangabandhu Sheikh Mujibur Rahman. He appreciated the impressive socio-economic development in Bangladesh especially in the areas of economic growth, poverty eradication, women’s empowerment and education, under the leadership of Prime Minister Sheikh Hasina. He also appreciated the steps taken by her towards strengthening democracy and promoting peace, security and stability in the region and beyond. He complimented PM Sheikh Hasina for her support to innovative ideas for enhancing sub-regional cooperation and connectivity. He also appreciated her commitment to the betterment of bilateral ties with India and the many path breaking initiatives taken by her to provide greater depth and substance to the relationship.

Historic Land Boundary Agreement (LBA)
The highlight of the trip was the exchange and signing of the documents related to the Land Boundary Agreement (LBA) 1974 and its 2011 Protocol between Bangladesh and India, recently passed by the Indian Parliament. The agreement simplifies the 4000 KM boundary issues between the two countries and clarifies the status and rights of the 52,000 people living in enclaves on both sides of the border. As a result of this agreement, residents of about 200 border enclaves, 106 on the Indian side and 92 on the Bangladesh side, will have the right to stay where they are or move to the other side of the border with full rights and privileges accruing to citizens of both countries.

Discussion on Water Resources LBA
During the visit, PM Sheikh Hasina invited India’s cooperation in jointly developing the Ganges Barrage on the river Padma in Bangladesh. Prime Minister Modi conveyed that he would have the matter examined by the concerned agencies in India. Prime Minister Hasina requested Prime Minister Modi for immediate conclusion of the Interim Agreement on Sharing of the Water of Teesta as agreed upon by both the governments in January 2011.

Prime Minister Modi conveyed that deliberations are underway involving all stakeholders with regard to conclusion of the Interim Agreements on sharing of waters of Teesta and Feni as soon as possible. The two Prime Ministers noted that discussions on various aspects relating to sharing of waters of the Manu, Muhuri, Khowai, Gumti, Dharla and Dudhkumar rivers were taking place at technical levels under Joint River Commission (JRC) and asked the concerned officials for taking expeditious action to conclude the sharing arrangements at the earliest.

Economic Zones for Indian Investors
Bangladesh has signed an agreement with India to develop two economic zones for Indian investors to boost investment from its neighbour. The zones will be set up in the port city of Mongla and Bheramara, Kushtia. Funding for these zones will come from the $2 billion Line of Credit (LoC) recently offered by India to the Bangladesh government. The government of Bangladesh will provide the requisite lands for these projects either through leasing or equity participation. Further details about these ventures will be agreed between the two countries.

Mega Power Projects7 MoUs
During the visit of PM Narendra Modi, two Indian power giants struck deals with Bangladesh for building plants producing a combined 4,600 megawatts of electricity in Bangladesh. Under the deals, separate memorandum of understanding (MoUs) were signed with Reliance Power Limited to develop four units of power plants to produce 3,000 MW of electricity with a cost of $3 billion and with Adani Power Limited to set up two coal-fired plants with a total capacity of 1,600 MW that will cost more than $1.5 billion. The gas fired power plants would take 13 months to complete construction after final agreements had been reached.

Coastal Shipping Agreement
To expedite cargo movements between Bangladesh and India, the two countries have signed an agreement on coastal shipping. The arrangement is likely to benefit both countries as it will significantly reduce freight charges and improve utilization of port capacities. It will also help in decongestion of roads especially at the Land custom stations/integrated check posts at the Bangladesh-India boarder.
The arrangement seeks to obligate both countries to render the same treatment to the other country's vessels as it would have done to its national vessels used in international sea transportation. The commencement of coastal shipping between the India and Bangladesh will increase bilateral trade between the two countries and lower down transportation costs of transportation of export import cargo.

Energy Cooperation
The two Prime Ministers agreed to further enhance cooperation between Bangladesh and India in the energy sector particularly in renewable energy and nuclear energy. Both Prime Ministers agreed to cooperate in the field of civil nuclear energy, especially training for technical personnel. Keeping in view the growing cooperation between the two countries in the energy sector, the two Prime Ministers decided to initiate an annual India-Bangladesh Energy Dialogue to be led jointly by Secretary (Petroleum) of India and Secretary, Power Division of Bangladesh to undertake comprehensive energy sector cooperation including areas of coal, natural gas, LNG, supply of petroleum products in the sub-region, renewable energy, oil and gas pipelines etc.
A memorandum of understanding (MoU) and Sale Purchase Agreement has been signed between Numaligarh Refinery Ltd (NRL) of India and Bangladesh Petroleum Corporation (BPC) for construction of a pipeline from Siliguri, India to Parbatipur, Bangladesh for supply of High Speed Diesel to Bangladesh. The two Prime Ministers directed the officials in both countries to quickly finalize the terms for establishment of the Joint Venture Company which will construct and operate the pipeline.

Agreement on Standardization
Bangladesh and India signed a bilateral cooperation agreement for cooperation in the field of standardization. Under the agreement, Bangladesh Standards & Testing Institution (BSTI) and Bureau of Indian Standards (BIS), the standards institutions of the two countries would acknowledge the standards-related certificates of each other boosting bilateral trade and commerce. Both the BSTI and BIS would take steps within a stipulated time to test the standards of goods and items on mutual agreement, speeding up the decision making process. Additionally, both the organizations would bring similarity into the standards testing process of each other in a bid to bring procedural consistency and uniformity through consultations.

Bilateral Trade Agreement (Renewal)
The renewed bilateral trade agreement, which allows both countries transit through each other's territories, is expected to usher in a new era of regional connectivity. Under the deal, Bangladeshi vehicles would be able carry goods to Bhutan and Nepal through Indian territories while India can transport cargo through Bangladesh, from the mainland to its northeastern states. The duration of the agreement has been extended from three years to five years, with the option of auto renewal.


Inland Water Transit: During the visit, the two countries signed the Protocol on Inland Water Transit and Trade Agreement (Renewal). The renewal extends the previous protocol for 5 years which expired on March 31, 2015. Both sides can extend it further as per mutual understanding. What is special about the amendment is that the new agreement will allow Bangladesh the use of channels for trade with other countries like Nepal and Bhutan. The trade route between the countries was around 3,000 nautical miles, but the amended protocol makes the direct route around 620 nautical miles, cutting trade costs by nearly 50%.

New Bus Services: Prime Minister Sheikh Hasina, Prime Minister Narendra Modi and West Bengal Chief Minister Mamata Banerjee jointly inaugurated two new bus services between Bangladesh and India, namely, the Kolkata-Dhaka-Agartala and Dhaka-Shillong-Guwahati routes. To regularize these services, the two countries signed the Agreement on Dhaka-Shillong-Guwahati Bus Service and its Protocol and the Agreement on Kolkata-Dhaka-Agartala Bus Service and its Protocol. The Indian Prime Minister also conveyed that the new bus services on Khulna-Kolkata and Jessore-Kolkata as proposed by Bangladesh, may be operationalised after completion of consultations by both sides.

Rail Connectivity: Prime Minister Modi agreed to consider Bangladesh’s proposal to introduce the 2nd Maitree Express between Khulna and Kolkata. The two Prime Ministers expressed satisfaction about the ongoing cooperation in the railways sector including the Akhaura-Agartala railway link and revival of the old railway links. They directed the concerned officials of both sides to take measures for ensuring more passenger-friendly customs and immigration facilities for the passengers of Maitree Express. Prime Minister Modi announced that India will construct a modern International Passenger Terminal (IPT) at a suitable location in India so as to facilitate customs and immigration requirements of passengers travelling on the Kolkata-Dhaka Maitri Express and other trains that are to connect India and Bangladesh.

$2 billion Line of Credit (LoC)
Bangladeshi and Indian governments have signed a memorandum of understanding (MoU) for India to provide Bangladesh with a fresh $2 billion line of credit (LoC). Under the MoU, India will provide $2 billion of fresh low-cost loans to Bangladesh, most of which will be used for connectivity-related projects to increase trade between the two countries. India first provided a $1 billion line of credit to Bangladesh in 2010. The terms and conditions of the fresh loan will be similar to those of the earlier loan. The finance ministry has prepared a primary list of around 20 projects after discussions with the Indian side for which the new line of credit can be used, mostly related to power, rail and ports.

Prevention of Human Trafficking
During the visit, the two countries signed a Memorandum of Understanding (MoU) on Prevention of Human Trafficking. This instrument aims to prevent human trafficking and speedy prosecution, especially trafficking in women and children. It also deals with rescue, recovery, repatriation and reintegration of victims of human trafficking. The instrument will pave the way for ensuring the speedy investigation and prosecution of traffickers and organised crime syndicates in either country.
It will also help in enumeration of preventive measures that would be taken to eliminate human trafficking in women and children and in protecting the rights of victims of trafficking and their expeditious repatriation. The home country will undertake the safe and effective reintegration of the victims. A task force from India and Bangladesh would take coordinated action against individuals/touts/agents involved in human trafficking.

Unveiling, Flagging Off & Inauguration
In a ceremonial event at the Prime Minister’s Office, the two Prime Ministers unveiled/inaugurated/flagged off the following: Flagging off Dhaka-Shillong-Guwahati Bus Service; Flagging off Kolkata-Dhaka-Agartala Bus Service; Unveiling of Foundation Stone for Construction of Khulna-Mongla Railway line; Unveiling of Foundation Stone for Rehabilitation of Kalaura-Shahbajpur section of Bangladesh Railways; Inauguration of Tarapur-Kamlasagar Border Haat; Unveiling of Foundation Stone for Bangladesh – India Friendship Building at National Police Academy, Sardah; Inauguration of Upgraded Laboratories at BSTI; Unveiling of Foundation Stone of Rabindra Bhaban Kuthibari, Shilaidaha; Unveiling of Foundation Stone for Construction of Bangladesh–India Friendship Bridge-1 over Feni River.

Complete List of Instruments Signed
The following agreements, memorandums and instruments were signed by the two countries during the visit: Exchange of Instruments of Ratification of 1974 Land Boundary Agreement and its 2011 Protocol; Exchange of letters on Modalities for implementation of 1974 Land Boundary Agreement and its 2011 Protocol; Bilateral Trade Agreement (Renewal); Agreement on Coastal Shipping between Bangladesh and India; Protocol on Inland Water Transit and Trade (Renewal); Bilateral Cooperation Agreement between Bangladesh Standards & Testing Institution (BSTI) and Bureau of Indian Standards (BIS) on Cooperation in the field of Standardization; Agreement on Dhaka-Shillong-Guwahati Bus Service and its Protocol, Agreement on Kolkata-Dhaka-Agartala Bus Service and its Protocol; Memorandum of Understanding between Coast Guards; Memorandum of Understanding on Prevention of Human Trafficking; Memorandum of Understanding on Prevention of Smuggling and Circulation Fake Currency Notes; Memorandum of Understanding between Bangladesh and India and for Extending a New Line of Credit (LoC) for US $2 billion by Government of India to Government of Bangladesh; Memorandum of Understanding on Blue Economy and Maritime Cooperation in the Bay of Bengal and the India Ocean; Memorandum of Understanding on Use of Chittagong and Mongla Ports,
Memorandum of Understanding for a Project under IECC (India Endowment for Climate Change) of SAARC; Memorandum of Understanding on Indian Economic Zone, Cultural Exchange Programme for the years 205-17; Statement of Intent on Bangladesh-India Education Cooperation (adoption); Agreement between Bangladesh Submarine Cable Company Limited (BSCCL) and Bharat Sanchar Nigam Limited (BSNL) for leasing of international bandwidth for internet at Akhaura; Memorandum of Understanding between University of Dhaka, Bangladesh and University of Jamia Milia Islamia, India; Memorandum of Understanding between University of Rajshahi, Bangladesh and University of Jamia Milia Islamia, India; and Handing over of Consent Letter by Insurance Development and Regulatory Authority (IDRA), Bangladesh to Life Insurance Cooperation (LIC), India.

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