Answer: India had a bilateral approach to its relations with South Asian neighbors in the past, as it preferred to engage in direct negotiations with each country on specific issues and bilateral high-level visits, rather than relying on regional coordination. India also provided development assistance to individual countries and focused on negotiating trade agreements with individual countries rather than pursuing a regional development and trade mechanism. However, India is no longer wedded to ‘bilateralism only’ in its approach and is adopting a multilateral approach with its immediate neighbors in the following ways:

• South Asian Association for Regional Cooperation (SAARC): It consists of 8 South Asian nations and provides a platform for India to engage with rival countries like Pakistan at the regional level. For instance, during the COVID-19 crisis, India proposed a COVID-19 Emergency Fund and supplied vaccines to SAARC nations under its grant assistance.
• The Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC): It consists of 7 South Asian and South-East Asian countries. It is important for India’s ‘Act East Policy’ and provides the strategic benefit of engaging with other SAARC nations (Bangladesh, Bhutan, Nepal, and Sri Lanka) without influence from Pakistan and China. Successful cooperation is reflected by the BIMSTEC Start-up Conclave (2021), BIMSTEC Conclave of Ports Summit (2019), and BIMSTEC Master Plan for transport connectivity (2022).
• Indian Ocean Rim Association: It consists of 23 countries of the Indian Ocean region. India revitalized the association in 2011 and identified its 6 priority areas. Further, Security and Growth for All in the Region (SAGAR) has been launched by India for maritime security in the Indian Ocean region.
• Efforts towards cooperation with maritime neighbors: For instance, Project Mausam for cultural diplomacy with 39 countries in the Indian Ocean region and Mission Sagar to assist the 15 littoral states of the Indian Ocean during the COVID-19 pandemic.
• Setting up of the BBIN (Bangladesh, Bhutan, India, Nepal) subregional cooperation: India successfully signed the BBIN Motor Vehicle Agreement (2015) when its proposal for SAARC MVA failed.

Challenges pertaining to effective cooperation in the region are as follows:

• Political differences and conflicts: South Asian countries have a history of political tensions and conflicts, thereby breeding mistrust and hindering collaboration among them.
  • The progress of SAARC has stalled over the years due to Indo-Pak relations.
  • The progress of BIMSTEC has also been underscored by Bangladesh-Myanmar relations over the Rohingya refugee crisis and the India-Nepal border issue.
• Economic imbalances: The economic disparities between the countries affect their capacity to participate effectively together, especially during crises such as the COVID-19 pandemic or natural calamities.
• Weak institutional mechanisms: For instance, despite the South Asian Free Trade Area (SAFTA) coming into effect as early as 2006, intra-regional trade continues to be at a meager five percent.
• Slow progress in regional integration: For instance, despite signing the BBIN MVA in 2015, Bhutan backed out of it in 2017.
• Dependence on external powers: China manages to influence other nations despite not being a part of the regional groupings through its debt trap policy and the Belt and Road Initiative.

Although over the last decade, India has made significant progress in connecting with its neighbors, India’s neighborhood policy is still a work in progress as the region adapts to new security challenges.