Is India turning to Central Asia?

The region of Central Asia¹ has had relations with India since the 3^rd century BC due to the connection via the Silk Route. Many famous personalities, including invaders, came to India via or from Central Asia and ended up spending their lives in India. In the other direction, Buddhism found its way to several Central Asian cities. Later, during the Soviet era, cultural exchanges between India and Central Asia, especially of Indian films, dance, and music, became more frequent. This article looks at India’s prospects and challenges in Central Asia within the current context.

Right now, the trade between India and Central Asia goes via the Port of Chabahar, Iran. India, Russia and Iran have constructed an International North-South Transport Corridor (INSTC) which connects, the countries of Central Asia, Azerbaijan, India, Iran and Russia using ship, rail and road routes. India’s connectivity with Central Asia is important for several reasons. India and China, despite their talks in BRICS and other forums, are competing on several fronts. China is also seen as a threat given its track-record in the past. Not only is there a rail and road connectivity between China and Central Asia. Additionally, oil from Caspian Sea offshore facilities in Kazakhstan and gas from Turkmenistan is going to the western regions of China by pipelines. These states are rich in minerals and wealthy with hydroelectric resources. Issues like extremism², narco-terrorism via Afghanistan, and drug-trafficking pose serious threats to these societies and to regional stability. India does not share borders with the Central Asian countries, and Pakistan does not allow India to connect through to Central Asian and Afghanistan. Using the route via China requires more effort and is expensive. INSTC is a way to solve this challenge, and to allow India to be in the ‘arena of great game’ currently being played by China, Russia, Turkey, Iran and Pakistan. India’s participation in BRICS, the Shanghai Cooperation Organisation (SCO) and attempts to have a Free Trade Agreement with the Eurasian Economic Union seem to cater on its security and economic stakes in the region.

Central Asia is not one of India’s foreign policy priorities. Nevertheless, New Delhi has shown growing interest in the region in recent years. Because of its late start in comparison to players like China and Russia, India’s position in Central Asia is not yet very strong. Attractive niches for co-operation are already occupied by other players interested in the region. Why does India need Central Asia? And how can New Delhi become an important player in the region while avoiding conflicts with other powers?

To begin with, it makes sense to consider the current balance of power in the region – especially Russia. Moscow has been present in Central Asia for over a century and a half (even during the imperial and Soviet eras). Russia co-operates with countries in the region within the Commonwealth of Independent States (CIS), the Eurasian Economic Union (EAEU), the Collective Security Treaty Organization (CSTO) and other platforms. Despite sanction pressure, Russia actively trades with Central Asian countries. Moscow also traditionally acts as a security guarantor for Central Asian countries, as Russia has an interest in the stability of its Eurasian allies. Finally, Russia is the largest recipient of labour and educational migration from the Central Asian countries. Remittances from Russia support households in Kyrgyzstan and Tajikistan.

After the collapse of the Soviet Union, the United States, the Western European countries, Turkey, Japan, South Korea and Middle Eastern states came to Central Asia. In 30 years, they have been able to achieve visible success in promoting their interests in the region. Several of these countries have established the C5+1 format³, which implies collective discussions with all Central Asian countries at once. They have brought new industries and technologies to Central Asia, as well as increased cultural ties.

In the last three decades, China has significantly strengthened its position in the region. During this period, the volume of trade turnover between China and the Central Asian economies has increased more than 100-fold. China has invested heavily in infrastructure development and the opening of new businesses in the region. At the same time, Central Asia is becoming increasingly wary of China. People in these countries fear that their economies could become dependent on Beijing.

This is why many people in the Central Asian countries prefer a multi-vector foreign policy. India could become another alternative if it can offer its own vision of how to develop relations with the region. In fact, New Delhi paid attention to Central Asia immediately after the collapse of the Soviet Union, but due to lack of resources and prioritisation of other areas – South Asia, Southeast Asia, East Africa – India’s presence in Central Asia has expanded in very small steps.

Unlike Russia and China, India has no common border with the Central Asian states. Overland trade routes pass through Pakistan and Afghanistan, which imposes additional costs on Indian companies. Because of this, India’s trade turnover with Central Asian countries is lower than with East African countries, which only can be reached via the sea.

In recent years, India has been developing trade through the Iranian port of Chabahar, which links Russia, Iran and India. Russia and India’s positions coincide on this issue. Part of the route passes through Turkmenistan. Undoubtedly, the expansion of the North-South trade corridor will make contacts between India and Central Asia more intensive. Access to Turkmenistan, Kazakhstan and the Caspian region in general will give India access to hydrocarbon supplies. This is an important resource for the growing Indian economy. India has been investing in Kazakhstan’s oil production since 2005. India’s nuclear power plants could use uranium from Kazakhstan and Uzbekistan, for which Russia, China, France and other nuclear powers also compete.

Other areas of economic co-operation are stalling. The reputation of Indian companies in Central Asia has suffered significantly in recent years. In 2023, India suffered image damage. First, about 300 people, including dozens of children, died after consuming Ambronol and Dok-1 Max cough syrup produced in India. Uzbekistan was hit the hardest. This case undermined confidence in Indian medicines.

Then there was a mine accident in the Karaganda region in Kazakhstan that killed 46 people. This accident was not the only tragic incident at ArcelorMittal’s operations in Kazakhstan. Dissatisfaction with the firm’s owners grew. By mutual agreement with the Kazakh government, Laksmi Mittal, a British entrepreneur of Indian origin, sold his company in Kazakhstan to a local businessman. Although the investment activities of Indian nationals are not directly linked to India itself, there remains a negative public perception of Indian companies in general.

Conclusion

Indian policy in Central Asia lacks coherence and consistency. Obtaining coherence/consistency implies investing in large projects for years, perhaps decades. Given the geographical separation of Central Asia from India and the increased competition from other players, it seems New Delhi is not yet ready to invest heavily in the region, preferring projects in South Asia and Africa, which can yield quicker returns with smaller investments.

1. The region of Central Asia consists of Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan. ↩︎
2. The term “extremism” has a particular meaning in the Central Asian context, linking it to religious fundamentalism. The term is used within the communications of the United Nations. ↩︎
3. The C5+1 diplomatic summit, which has taken place annually since 2015, brings together the foreign ministers of Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan, alongside the United States Secretary of State. This forum aims to address shared concerns and strengthen the U.S. relationship with these five Central Asian nations while also fostering improved relations among the countries themselves. ↩︎