Bangladesh crisis leaves India with major foreign policy challenge, uncertainty over trade ties

The sudden exit of Bangladesh’s Prime Minister Sheikh Hasina from the country in the wake of mass student protests is threatening to become one of India’s worst foreign policy headaches that is likely to test all of its capability to resolve.

After having fled the country, Hasina landed in India’s Hindon Air Base on the outskirts of the capital New Delhi, where she is likely to be based temporarily before heading to a European destination, according to local media reports.

“The bulk of the students have already returned to India in the month of July on the advice of the High Commission,” Jaishankar said, adding that border forces had also been instructed to be “exceptionally alert in view of this complex situation”.

Throughout her 15-year rule, Hasina had maintained strong ties with Delhi that had blossomed into Bangladesh emerging as one of India’s top export destinations for a variety of goods and services – from cotton yarn to make garments to information technology.

The booming trade with Dhaka was also promising to become an anchor in boosting moribund trade within the Bay of Bengal region that sits at the nexus of strategic trade routes positioned between the Indian and Pacific Oceans.

“We will have to wait and watch how things happen. The government of India had invested a lot in Hasina’s government and virtually given her everything that she wanted,” said Biswajit Dhar, professor at the Delhi-based research institute Council for Social Development.

Over the course of a decade, Bangladesh’s economic rise had propelled it almost to the rank of an “Asian Tiger” though growth had tapered in the last 1½ years and Dhaka had started drawing substantial foreign investments.

According to a report in India’s leading business