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EFSAS Commentary

South Asia in 2023 | A mixed year in which some nations marched ahead while others stuttered and floundered


2023 was the year a South Asian country broke barriers and successfully landed a spacecraft on the dark side of the moon. In a display of its growing international standing, India this year also held the G20 Summit in New Delhi, the first ever world event of such scale and magnitude to be held in the region. Things looked upward for India through most of 2023, with its economy booming and remaining the fastest growing in the world, its stock markets achieving unprecedented highs and emerging as a serious global player, and the international community, cutting across blocks and groupings, extending the olive branch to a country that they all see as having an important role in the new world order that is presently in the process of being hammered out by the powerful players involved.

In contrast, much of the rest of South Asia has had a rough time in 2023. Pakistan has experienced severe political, economic and security shocks, and there were periods during the year when the entire system seemed to be on the verge of collapse. The Army has tried to improve matters, but it has at the same time striven to reassert and reinforce its dominance over all major aspects of the country’s governance, including the economy and foreign relations. In Sri Lanka, the island nation has struggled over the past two years to claw out of its worst financial crisis in decades. Reuters reported that Sri Lanka’s central bank has projected that gross domestic product (GDP) will shrink by another 2% this year, having contracted 7.8% in 2022. In Bangladesh, political tensions are running high over the general elections that are scheduled to be held next month, which incumbent Prime Minister Sheikh Hasina and her Awami League (AL) party are expected to win again.

The Maldives saw former President Abdulla Yameen’s chosen candidate Mohamed Muizzu win the general elections this year with 54% of the votes, defeating the incumbent Ibrahim Mohamed Solih. Yameen’s return to the helm, even if by proxy, has, worryingly for the likes of the United States (US) and India, allowed China a glorious return to the strategically located archipelago that it had invested heavily in during Yameen’s term as President. In Afghanistan, the plight of Afghan women and children became even more dire in 2023. In Myanmar, the most significant escalation in hostilities since the 2021 coup worsened the ongoing humanitarian crisis in 2023.

The gloom that hangs over much of South Asia, however, needs to be seen in the wider context of a crumbling world order. As Harsh V. Pant, Professor of International Relations at King's College London, aptly pointed out, “As we bid adieu to the year 2023, we are witnessing a global order that has been fundamentally reconfigured - politically, economically and diplomatically. Trends that were simmering below the surface for the last few years have burst into the open, revealing in all their complexities the challenges that are becoming difficult to manage by extant frameworks and institutions. There is an intellectual void at the very heart of international relations and it is being filled by the overuse of the term ‘disruption’. Whatever the world can’t seem to grapple with or come to terms with is being labelled ‘disruptive’. Indeed, this is an inflection point but the underlying forces shaping it had been there with us for some time now. The world is grappling with the fundamental transformations brought in by shifting power balance, technological overreach, and institutional decay. These underlying shifts have been exacerbated by the COVID-19 pandemic and wars in Eurasia and the Middle East, resulting in global inflationary pressures, food and energy crises, and widespread economic downturn”.

Dr. Sriparna Pathak, Associate Professor at O.P. Jindal Global University, elaborated on 27 December that “After two World Wars, the international community set up rules and institutions to ensure that devastation of that scale never took place again. The international system went through a series of changes, with the rise of smaller powers and the replacement of a bipolar world order - as seen during the Cold War - with a multipolar world. Countries beyond the US and the former Soviet Union, like India, China, South Korea, and Japan, have emerged as important voices. However, in the last three years, a series of events have shaken the foundations of the existing world order. Examples include China's heightened aggression against India, Taiwan, Japan, and the Philippines, the Russia-Ukraine war, and the terrorism unleashed by Hamas on Israel and Israel’s response to the attacks. What is also a fact that cannot be ignored is the emergence of regional and multilateral groupings to respond to challenges that global bodies such as the United Nations (UN) have not been able to address adequately”.

Both the experts quoted above also commented extensively on India’s role and responsibility in these groupings. Pant felt that “This year saw India taking on the global leadership role with aplomb as its G-20 presidency gave New Delhi a chance to shape the agenda for global cooperation in a world emerging from the shadows of the COVID-19 pandemic. For India, this was an opportunity to underline its emerging status as a ‘leading power’. The G-20 is unique in so far as it brings together the developed and the developing nations to discuss and create solutions to global governance challenges. New Delhi used this platform vociferous in giving voice to the aspirations of the Global South... This is in sync with India's desire to play a larger global role by not only participating in key global alliances and multilateral fora but also creating new ones”.

Pant continued, “The second trend visible this year was India’s continuing ability to balance its key partnerships. New Delhi’s ties with major global powers continued to grow despite challenges. The Ukraine war did not create a rupture in India’s ties with the West, something that was anticipated when the conflict had begun last year. Instead, these relations continued to grow and evolve”. Terming the present as an “inflection point for the global order and for India”, Pant foresaw India’s emergence as a “top-tier geopolitical player that can lead, not simply balance”. He added that the choices that New Delhi makes over the next few years “will define the contours of that rise”.

Simantik Dowerah wrote in an opinion piece in Firstpost this week that “The year 2023 will go down as a landmark year for India. There were singular achievements like the moon landing on the dark side and the brightness of an extremely successful G20 Summit. The effort to become a voice of the Global South was successful. Both the Global South Summits before and after the G20 summit revitalized Indian credentials. The success in bringing the African Union into the G20 through a hard-won consensus and ensuring that the interests of the developing countries were not lost sight of while countries grappled over the Ukraine crisis were indeed proud moments. The signing of the India-Middle East-European Connectivity Corridor (IMEC) was a significant development, opening up huge possibilities to the west of India. The decision that India would host the Quad summit in 2024 added heft to India’s stature”.

If a sense of achievement and an outlook of optimism permeated the thoughts and writings of Indian analysts, the picture that was portrayed from writings in India’s western neighbour, Pakistan, was far more grim and depressing. Maleeha Lodhi, former Pakistani Ambassador to the US, the United Kingdom (UK), and the UN, wrote in ‘Year of living on the edge’ in the Pakistani daily Dawn that “2023 was another tumultuous year in Pakistan. It saw much uncertainty in the country — about the economy and how its volatile politics will pan out. The question whether general elections would be held on time echoed through the year until the announcement at year end of a firm date and election schedule, with the Supreme Court acting as a ‘forcing’ factor. This put an end to uncertainty about the election date but not how, fair, free and inclusive the polls would be”.

Describing how the year had panned out for Pakistan, Lodhi continued, “The first half of the year saw the ruling Pakistan Democratic Movement coalition engage in countering opposition leader Imran Khan and containing protests by his party in a politically charged atmosphere. An overarching aspect of these months of political tensions was the deepening polarisation in the country. PDM’s record in governance during its 16 months in power was unexceptional, inevitable perhaps for a diverse, unwieldy 13-party coalition. It became defined by its bloated cabinet — the largest in the country’s history. Its erratic economic management, with a change of finance minister early in its tenure, compounded the situation when the country was mired in the worst economic crisis in its history, although this was the cumulative result of decades of dysfunctional policies and political instability. 2023 also saw the country teeter precariously on the edge of debt default. This was narrowly averted by a bailout deal with the IMF in July and by the rollover of loans by China. The Stand-by Arrangement (SBA) with the Fund provided the economy a temporary reprieve for which the government was obliged to take a series of tough measures to stabilise the situation. Soaring inflation added to the cost-of-living crisis and the public’s growing economic burden while the sudden and sharp rise in electricity bills fuelled widespread discontent and protests”.

Lodhi underlined that for Pakistan, “Political volatility and economic fragility characterised 2023, raising questions about future stability. The caretaker government assumed charge of the country in a hybrid governing arrangement in which the balance of power shifted even more significantly to the military to become a defining feature of governance in 2023. Major decisions in the interim phase were taken by the military establishment including on the economy, epitomised by the creation and management of the Special Investment Facilitation Council to promote ‘fast track’ investment by friendly Arab countries. It was also evidenced by the decision to expel illegal foreign nationals, mostly Afghans from the country, and a much tougher policy towards Kabul, following a surge in terrorist attacks in Pakistan by the outlawed group TTP, based in Afghanistan. However, the security situation continued to deteriorate throughout the year”.

In Lodhi’s view, “The most politically significant development of the outgoing year was the irrevocable breakdown of Imran Khan’s relations with his erstwhile backers in the military establishment. When violent protests broke out on May 9 over his (then temporary) arrest, PTI supporters attacked and vandalised military installations and government buildings. This, and Khan’s persistent allegations that the military was behind a US-inspired plot to unseat him, sealed his fate. In August, he was arrested after his conviction by the Islamabad High Court in a corruption case that held him guilty of illegally selling state gifts. The conviction banned Khan from contesting elections and holding public office for five years. Over a hundred other cases were registered against him. A sweeping crackdown saw arrests of PTI leaders and activists while some were coerced into abandoning the party. By the close of 2023, almost all its senior leaders were in jail while the party’s efforts to hold public rallies were constantly disrupted by the authorities. This raised the question of how fair the poll would be with PTI claiming it was being ‘forced’ out of the election process. Being deprived of its electoral symbol ‘bat’ by the ECP reinforced these doubts”.

Lodhi described Nawaz Sharif’s political comeback as “nothing short of remarkable”, and added that “Having returned now and able to secure favourable court verdicts in politically motivated cases in which he had been convicted, he quickly positioned himself for a fourth bid for prime ministership. He also got down to the business of politics, rallying his party, mending internal rifts and forging election alliances with other parties in anticipation of the possibility that the electoral outcome would necessitate a coalition government”.

Saying that “more than politics it was the economy that emerged as the crucial factor to determine the country’s fate and fortunes in 2024 and the years ahead”, Lodhi ventured that “the consequential question for the year ahead was whether the election would produce a government committed to comprehensive reforms to address long-standing structural problems that could put the country on a path of sustained economic recovery and growth”.

Besides Pakistan, other prominent South Asian countries, Bangladesh and India among them, will go to the polls in 2024, and the results of each of these elections will influence and guide the direction and trajectory each of these countries takes in 2024 and beyond.