INDIA-CENTRAL ASIA RELATIONS: CHALLENGES, WAY FORWARD

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Context

In response to recent US tariff hikes targeting Indian exports, India views Central Asia as vital for diversifying its export markets and mitigating risk.

Evolution of INDIA-CENTRAL ASIA Relations

Historical Roots: India's relations with Central Asia date back to the 3rd century B.C., boosted by the Silk Route, which exchanged goods, ideas, religion like Buddhism, and philosophies.

• Kushana Empire, established by the Central Asian Yuezhi tribe, formed a powerful empire that expanded Central Asia and northern India, promoted trade, diplomacy, and cultural exchange, particularly along the Silk Road.
• Various groups including Greeks, Shakas (Scythians), Huns, and Mughals migrated from or through Central Asia, leaving lasting impacts on the Indian subcontinent's history and culture.

Modern Diplomatic Relation: Central Asian states gained independence in 1991. India recognized their independence and offered financial assistance.

• In 2012, India officially launched its "Connect Central Asia Policy," a broad-based approach including political, security, economic, and cultural dimensions.
• Prime Minister Narendra Modi's visits to all five Central Asian Republics (CARs)—Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan—in 2015 strengthened India's Central Asia policy.
• Establishment of the India-Central Asia Dialogue at the Foreign Ministers' level in 2019, discussed regional security and economic engagement.
• The 1st India-Central Asia Summit, a leader-level engagement, took place in January 2022, marking the 30th anniversary of diplomatic relations and adopting the "Delhi Declaration" for future ties.
• The 4th India-Central Asia Dialogue in New Delhi in June 2025, condemned the Pahalgam terrorist attack (April 2025) and called for the early adoption of the UN Comprehensive Convention on International Terrorism (CCIT).
• The India-Central Asia Digital Partnership Forum, established during the 4th India-Central Asia Dialogue, aims to promote collaboration on Digital Public Infrastructure (DPI), leverage technology for development across sectors, and promote greater connectivity between India and the Central Asian countries.

Why is CENTRAL ASIA important to India?

Geostrategic Significance: Central Asia's location makes it a land bridge connecting Europe and Asia. India considers the region's security, stability, and prosperity vital for its own peace and economic development. India views the Central Asian Republics (CARs) as part of its "extended neighborhood". 

Energy security: Central Asia possesses vast reserves of natural gas, oil, and critical minerals, important for India's energy security.

• According to the World Population Review, Kazakhstan is the world's largest uranium producer, over 46% of global production.  
• Kazakhstan remains India's largest uranium supplier, providing 5,000 tonnes between 2015 and 2019, extended to 2024, covering an estimated 80% of uranium needs, currently negotiating a new uranium supply agreement.
• India's energy demand is expected to nearly triple by 2040, making access to reliable energy sources, including those in Central Asia like Kazakhstan, crucial for energy security.

Economic opportunities: India's trade with Central Asia reached $1.2 billion in 2024-25.

• India provided a US$1 billion line of credit in 2020 for infrastructure development projects in the CARs, including Tajikistan's Dushanbe-Chortut highway. 
• India aims to enhance financial connectivity through digital payment systems, interbank relations, and trade in national currencies.
• India and Central Asian countries have expressed interest in joint exploration of rare earth and critical minerals during the 4th India-Central Asia Dialogue. India also invited Central Asian countries to join its global platforms like the International Solar Alliance (ISA), Global Biofuels Alliance (GBA), International Big Cat Alliance (IBCA), and Coalition for Disaster Resilient Infrastructure (CDRI).
• The region's vast cultivable areas present opportunities for pulse cultivation.  
• The growing Central Asian economies attract Indian companies in sectors like financial services, construction, and IT. 

Strategic Interests: Instability in Afghanistan and the threat of terrorism and extremism, India views the CARs as vital partners in counter-terrorism efforts and maintaining regional stability.

• In the first half of 2025, Central Asia attracted $25 billion in Belt and Road Initiative (BRI) investments, with Kazakhstan being the largest recipient at about $23 billion. India aims to counterbalance China's expanding influence in the region, by offering an alternative development model.
• India promotes connectivity projects like the International North-South Transport Corridor (INSTC) and the Chabahar Port development to enhance trade and overcome geographical barriers.
  • Chabahar Port in Iran is considered the "Golden Gate" for trade between India and Central Asia, providing a vital sea-land route that bypasses Pakistan.
• The CARs support India's bid for permanent membership in an expanded and reformed UN Security Council. 

Why India is Important for Central Asian Countries?

Diversifying Partnerships: Central Asian countries desire to expand their strategic alternatives, to avoid over-reliance on any single power. India offers a reliable and trusted alternative, balancing against other regional players like China and Russia.

Economic Opportunities: India's expanding economy presents opportunities for trade and investment, particularly in sectors such as agriculture, mining, IT, pharmaceuticals, and infrastructure.

• Several Indian pharmaceutical companies have a presence in Tashkent, Uzbekistan, producing both finished dosage medicines and Active Pharmaceutical Ingredients (APIs) for local manufacturing, and joint ventures exist for drug production in the region.

Connectivity Enhancement: Being landlocked, see the potential in India's initiatives like the INSTC and Chabahar port.  

Counter-Terrorism and Security: They find India a reliable partner in counter-terrorism efforts and maintaining regional stability through joint exercises and intelligence sharing.

Educational and Healthcare Cooperation: India offers affordable and quality education, attracting numerous students from Central Asia. Indian healthcare services and pharmaceutical products find a ready market in the region.

Addressing Regional Challenges: Central Asian countries see India as a valuable partner in addressing shared challenges like climate change, disaster management, and promoting regional peace, particularly in Afghanistan.

Energy Market Access: They aim to diversify their energy export routes, India's increasing energy demand presents a opportunity for them to secure long-term markets for their oil, gas, and uranium resources.

India's Policy Towards Central Asia

India aims to integrate these landlocked nations' markets, bypassing Pakistan.

India streamlined trade by accepting the Customs Convention on International Transport of Goods under TIR Carnets in 2017 and joining the Ashgabat Agreement in 2018. 

India focuses on a development-centric approach through capacity building and human resource development. The Indian Technical and Economic Cooperation (ITEC) Programme provides technical assistance and training in areas like IT, banking, and English language skills.

Soft power diplomacy remains a key element, promoting cultural exchange programs, educational initiatives, and people-to-people ties. Bollywood, Indian cuisine, yoga, and traditional medicine enjoy popularity in Central Asia.

Security cooperation involves military training, Joint military exercises like "Dustlik" with Uzbekistan and "Kazind" with Kazakhstan, joint research, and counter-terrorism coordination. India maintains a military hospital in southern Tajikistan and has operated the Farkhor Air Base since 2006.

Challenges and Obstacles in INDIA-CENTRAL ASIA RELATIONS

Limited Connectivity:  India does not share a direct land border with any Central Asian nation, making trade and transit depend on routes passing neighboring countries like Iran, Afghanistan, and Pakistan.

• Initiatives like the Chabahar Port offer potential solutions, however, their implementation faces delays and challenges, due to regional instability.
• Limited and expensive air connectivity hampers seamless movement of goods and people.

Low Bilateral Trade Volumes: Despite the immense potential, the combined trade volume between India and the five Central Asian Republics (CARs) remains less than 0.5% of India's total trade.

• High logistical costs, non-tariff barriers, and insufficient banking and payment infrastructure hinder trade expansion. The 4th India-Central Asia Dialogue emphasized the need for enhanced interbank relations and trade in national currencies.
• Absence of comprehensive Free Trade Agreements (FTAs) restrict trade growth.

Competition from China: China's Belt and Road Initiative (BRI) has solidified its position as the leading trading partner and infrastructure investor in all CARs, impacting India's options for engagement.

Security Instability: Unstable situation in Afghanistan and Iran, and the presence of various terrorist groups, including the Al-Qaeda, and Pakistan-backed Lashkar-e-Taiba (LeT), pose security challenges for the region and for India's engagement efforts.

• Drug and arms smuggling, threat of radicalization, complicate regional stability and hinder development projects like the TAPI gas pipeline.  

Underutilization of Multilateral Platform: India and Central Asian countries are members of organizations like the Shanghai Cooperation Organization (SCO), however, concrete synergy and the implementation of actionable projects remain a challenge.

Way Forward for Strengthening INDIA-CENTRAL ASIA Relations

Accelerate connectivity projects: Work towards the full operationalization of the International North-South Transport Corridor (INSTC) and Chabahar Port.  

• The Chabahar-Zahedan railway track connecting the port to Iran's national rail network is expected by mid-2026. This rail link will facilitate direct access to Afghanistan and Central Asia via the INSTC.
• India seeks Turkmenistan and Uzbekistan's membership in the INSTC to enhance direct rail links through Kazakhstan and Turkmenistan to Iran's railway network. 

Secure long-term energy and critical mineral agreements: India and Central Asian countries have expressed interest in jointly exploring rare earth and critical minerals, exchange of delegations to explore new areas of cooperation in critical minerals.

• India launched the National Critical Mineral Mission (NCMM) to secure a long-term, sustainable supply of critical minerals and strengthen India's critical mineral value chains. 

Build robust financial and trade infrastructure: Increase financial connectivity, including trade in national currencies, to encourage greater trade, investment, tourism, and people-to-people exchanges.

• Promote B2B engagements through the India-Central Asia Business Council (ICABC) and joint chambers of commerce can boost trade flows. 

Export India Stack and digital governance models: Promote Digital Public Infrastructure (DPI) Initiatives in Central Asian countries, introduce a globally adaptable version of Aadhaar enabled UPI system.

Expand human capital and skill development cooperation: Scaling up Indian Technical and Economic Cooperation (ITEC) scholarships, vocational training, and medical fellowships, to contribute to human resource development.

• Establish Indian university campuses and introduce joint R&D initiatives in emerging fields like AI, biotech, and agri-tech.

Enhance security cooperation and counter-terrorism dialogue: Institutionalizing National Security Council (NSC) level consultations and intelligence sharing.

• Joint training programs for drug law enforcement, cybersecurity, and deradicalization strategies, alongside utilizing SCO and bilateral formats, to address regional security threats. 

Counterbalance China's influence: Counter Chinese influence in Central Asia by developing people-centric projects like capacity building, digital partnerships, and healthcare initiatives, alongside strategic investments in connectivity, energy, and financial linkages to increase soft power and stronger relations.

Source: THE HINDU