Welcome to Foreign Policy’s South Asia Brief.

The highlights this week: China’s COVID-19 surge has ripple results in India, Pakistan secures $10 billion in new pledges for flood help, and India’s commerce secretary visits the United States.

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As COVID-19 instances proceed to rise in China, India is taking protecting measures that recall earlier phases of the pandemic. Travelers arriving in India from China—together with Hong Kong, Japan, South Korea, Singapore, and Thailand—should take a COVID-19 check, and those that check constructive or exhibit signs face quarantine. Indian well being officers have called for vigilance, however the extra damaging impacts for India might be financial.

India has come a good distance since its personal catastrophic COVID-19 surge practically two years in the past. Nearly 70 percent of the inhabitants is totally vaccinated, considerably larger than the 46 percent determine of a 12 months in the past. Despite doubtlessly ominous indicators—lower than 30 % of Indians have acquired a booster, and studies have discovered vaccine hesitancy amongst older folks—new case numbers have to this point held regular amid China’s main wave. Still, Indian well being officers are urging extra masking and calling for extra vigorous genome sequencing.

However, India’s extra speedy concern would be the results of China’s COVID-19 disaster on bilateral commerce, which has remained strong regardless of severe border tensions. Since a lethal border conflict in 2020 plunged India-China ties to their lowest stage in a long time, the 2 international locations have really increased their commerce quantity. In India’s 2022 fiscal 12 months, commerce with China was more than $115 billion—a virtually 35 % enhance from the earlier 12 months. Chinese exports to India are a major driver of this pattern—and of a record-breaking Indian commerce deficit with China.

This is why China’s COVID-19 surge has some Indian traders worried. India’s high imports from China embody electronics, chemical compounds, and prescription drugs. Pandemic-related labor shortages, compounded by provide chain crunches, might hamper these Chinese exports. Although this might cut back India’s commerce deficit, Indian exports may also fall as a consequence of China’s financial slowdown and decreased demand. Indian engineering merchandise have already seen a significant decline. Indian exporters are actually seeking to redirect gross sales of some merchandise, especially tea, to Russia.

However, China’s COVID-19 wave has some potential constructive industrial implications for India. India’s drug business has a serious alternative, though Indian media reports that surges in Chinese demand for COVID-19 medicines have, in actual fact, led to low-cost, counterfeit Indian medicine flooding Chinese markets. Another potential benefit is that Western know-how companies, already exploring relocating some manufacturing from China to India as a consequence of Beijing’s coverage surroundings, now have added incentive to deal with India.

So far, no South Asian nation moreover India has imposed new restrictions on vacationers from China. But any provide chain shocks might additionally show damaging for Pakistan, which depends closely on China for financial support and infrastructure help. Most international locations within the area have acquired investments from China in recent times. Other South Asian states’ commerce quantity with China is lower than that of India and Pakistan, though some smaller international locations rely on it closely for commerce. For instance, China is Nepal’s second-largest commerce companion.

India, which now has a positive macroeconomic outlook, can achieve some strategic benefits amid China’s well being disaster and financial pressure. In its ever-intensifying strategic competitors with Beijing, New Delhi can redouble efforts to extend investments round South Asia, from infrastructure to COVID-19 vaccines. In early 2021, earlier than its personal surge, India was a top supplier of COVID-19 pictures throughout the area. Beijing then capitalized and elevated its personal vaccine supply efforts.

Will Indian Prime Minister Narendra Modi donate COVID-19 vaccines to his Chinese rival? It’s unlikely, and Beijing would possible decline the provide because it has previously with Washington. With 9 state elections in India this 12 months and nationwide polls looming in 2024, it additionally might not be the second to make a tender gesture towards China. But it could’t be dominated out for a frontrunner recognized for daring and sudden strikes.

Pakistan secures new pledges for flood support. This week, Pakistani Prime Minister Shehbaz Sharif and U.N. Secretary-General António Guterres hosted a donor convention in Geneva, the place Pakistan acquired round $10 billion in pledges for meals aid and restoration after devastating floods final 12 months. Pakistan remains to be reeling from the catastrophe, which submerged one-third of the nation and affected 33 million folks.

According to UNICEF’s latest update, practically 15 million folks in Pakistan nonetheless want emergency meals support and 10 million youngsters want speedy help. An estimated $40 billion in flood damages have contributed to an financial disaster that might deliver Pakistan to the brink of a debt default. Most of the brand new pledges come from multilateral organizations, with the Islamic Development Bank, World Bank, Asian Development Bank, and Asian Infrastructure Investment Bank providing probably the most help.

Key particulars in regards to the pledges are usually not but public, together with how funding will probably be delivered and which authorities entities will oversee it. It may even take time for the funds to succeed in Pakistan. On Wednesday, Pakistani Finance Minister Ishaq Dar acknowledged that just about 90 % of the pledges will probably be loans. With this new help, Islamabad can’t afford to be complacent. Yet the federal government, distracted by an financial disaster, terrorist threats, and its spat with opposition chief Imran Khan, reveals little signal it is going to make flood aid a sustained precedence.

Indian commerce minister visits U.S. Piyush Goyal, India’s commerce minister, visited New York and Washington this week, the place he met with U.S. Treasury Secretary Gina Raimondo and U.S. Trade Representative Katherine Tai and took part within the thirteenth India-U.S. Trade Policy Forum. In New York, Goyal met with high U.S. enterprise leaders. In line with progress in bilateral relations, U.S.-India commerce quantity has not too long ago reached new heights, setting a document of $113 billion in 2021.

But commerce has additionally been a stress level for India and the United States. Disagreements over tariffs practically produced a trade war through the Trump administration, and these points stay unresolved. Despite frequent engagements between enterprise leaders on either side, some U.S. financiers proceed to fret about problematic taxation insurance policies, overregulation, and different options of India’s funding surroundings.

Aid chief requires West to extend Taliban engagement. The head of the Norwegian Refugee Council, Jan Egeland, is in Kabul this week to press Taliban leaders to reverse their ban on girls’s employment with nongovernmental organizations. Even whereas lambasting the Taliban’s transfer, he has called on Western states to ship diplomats again to Kabul for the sake of the Afghan folks. A high U.N. official, Markus Potzel, made an analogous remark final month when he advised Western international locations to reopen their Kabul embassies.

At first look, such a coverage could seem prone to do little however reward the Taliban. Many officers, together with in Washington, are at the moment contemplating punitive strikes that embody new sanctions on Taliban leaders and even cuts to humanitarian support. But there could also be one other motivation for calling on Western diplomats to return to Kabul: It would allow potential channels of communication with Mullah Hibatullah Akhundzada, the Taliban supreme chief who has approved the group’s latest draconian strikes.

Foreign diplomats meet usually with Taliban leaders in Qatar, the place most personnel from shuttered embassies in Kabul are actually primarily based. But these leaders are usually from the Taliban’s extra reasonable faction, a few of whom disagree with Akhundzada’s strikes. Akhundzada is hunkered down within the metropolis of Kandahar and isn’t recognized to journey. Foreign diplomats possible wouldn’t reach assembly with him, however they wouldn’t know until they tried.

Nepali politician Pushpa Kamal Dahal leaves the president’s workplace to assert a majority for his appointment as the brand new prime minister in Bhaktapur, Nepal, on Dec. 25, 2022.DIPESH SHRESTHA/AFP by way of Getty Images

On Tuesday, the Nepali Army announced the beginning of joint army workouts with the United States that may run via Feb. 3. Thirty-five Nepali officers will take part with 19 U.S. personnel in actions associated to search-and-rescue operations after pure disasters. This 12 months marks the twelfth iteration of those workouts, however the timing of this 12 months’s occasion is notable. The workouts started the day that Pushpa Kamal Dahal secured a vote of confidence in parliament, paving the best way for him to develop into Nepal’s subsequent prime minister after elections last November.

Dahal, a former Maoist fighter nonetheless recognized by his wartime moniker Prachanda, has fashioned a brand new alliance together with his longtime rival, former Prime Minister Ok.P. Sharma Oli—who oversaw an enchancment in relations with China. Dahal’s alliance with Oli, coupled together with his ideological similarities with China, have some Indian commentators involved that he could deliver Kathmandu nearer to Beijing’s orbit. However, Dahal says he needs good relations with each China and India, according to Nepal’s longstanding official place.

The U.S.-Nepal army workouts will be learn as a mirrored image of that coverage, displaying that Nepal’s new management could search hotter ties with China—however that received’t cease it from conducting actions that match with India’s pursuits, too.

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Analyst Aneela Shahzad, writing within the Express Tribune, warns of the rising energy of the Islamic State terror group in Afghanistan and the implications for neighboring Pakistan. “What we in Pakistan and the region must embrace is an incoming onslaught of ISIS and the likes, in Afghanistan,” she writes.

A Dhaka Tribune editorial laments how the nation’s demand for extra arts choices goes unmet, noting the excessive turnout for the latest Dhaka Literature Festival. “Clearly a renewed focus on the arts is the order of the day, not only in terms of meeting local demands but also in terms of adding a new dimension to how we showcase and export our culture and ideals,” it argues.

In the Print, journalist Dilip Mandal describes demographic modifications amongst Indian cricketers, which he attributes to modifications within the recreation of cricket itself: “Now we see more and more cricketers from farming and cattle-rearing communities,” he writes. “Domination of Mumbai, Chennai, and Delhi is also receding. More and more players are coming from small towns.”