Lost Bets: Rethinking India’s Myanmar Strategy

27 Dec, 2023    ·   5863

Fiona Raval assesses the strategic payoff from India’s trade and infrastructure investments and military cooperation with Myanmar

The Tatmadaw usurped power in Myanmar through a coup in February 2021. In the two and a half years since, India has been tolerant of the junta and hasn’t yet interacted with the pro-democracy National Unity Government (NUG). Further, in taking a “business as usual” approach in the interest of certain geostrategic calculations, India has effectively also offered support to the regime. The economic, political, and strategic benefits that New Delhi hoped to reap from this approach, however, have yet to be forthcoming. In fact, an assessment specifically of India’s trade and infrastructure investments in, and military cooperation with Myanmar recommend an urgent rethinking of its approach.

Assessing Trade and Infrastructure Investments

India’s investments in Myanmar have not yielded desirable returns.

For decades, India has been a prominent economic investor in, and trading partner to Myanmar. As of 2022, India’s development assistance to Myanmar, which includes infrastructure, amounted to over US$ 1.75 billion. This bilateral partnership includes highly publicised projects like the Kaladan Multimodal Transit Transport Project (KMMTP) and India-Myanmar-Thailand Trilateral (IMTT) Highway, which are crucial for India’s Act East Policy. India has also helmed development projects like schools, roads, and housing along the India-Myanmar border and in Rakhine State. Simultaneously, India is also one of the foremost buyers of Myanmar’s vegetables, gems, and timber. In addition to 13 Public Sector Undertakings (PSUs), several private Indian companies like Century Ply, Tata Motors, and Essar Energy have a notable presence in Myanmar.

Due to security concerns resulting from the civil war and specific areas being outside the Tatmadaw’s control, progress on these projects has been challenging. Projects to develop border areas and Rakhine State are unfinished. The KMMTP and the IMTT have missed multiple deadlines and aren’t yet operable. Following the coup, foreign companies have faced intense pressure from human rights groups to disinvest from Myanmar because such economic relations directly fund the military and its excesses. These companies have faced public ire, boycotts, and internal strikes. Such unviable conditions have steered several companies, including Chevron, Posco—even India’s Adani—into withdrawing from Myanmar. Furthermore, the NUG has declared that it won’t honour or recognise any investment deal or agreement made with the military since the coup.

Reviewing Strategic Objectives

India’s military cooperation with the junta has proved counterproductive to New Delhi’s strategic interests.

Myanmar’s cooperation is essential for India to maintain and monitor peace in its Northeastern region. Post-coup, India has supplied Myanmar with arms and defence technology amounting to US$ 51 million. These include radar technology, submarines, aviation fuel, explosives, ammunition, etc. This approach has been detrimental to India’s security interests. For example, the junta’s airstrikes along Myanmar’s northern border have caused physical damages on the Indian side. Additionally, there are reports of the junta facilitating the revival of Indian separatist outfits in order to combat the rebel alliance in northern Myanmar. Their mobilisation and deployment will have negative security repercussions for India. India-supplied military equipment and aviation fuel have also aided the junta in the “commission” of international crimes. This violence has forced tens of thousands of people to flee the country, compounding the pre-existing refugee crisis in the broader region, which, once again, has serious implications for India.

Another roadblock is India’s single-focus diplomatic engagement with the junta. India doesn’t appear to be considering power ambiguities in Myanmar, or accounting for this in its approach. Despite assistance from India and other countries, the junta is struggling to retain singular authority. Centres of power in Myanmar are in a state of flux, with large-scale, public resistance to their authority. The NUG’s claims of being the legitimate government and various Ethnic Armed Organisations (EAOs) joining the fight add complexity to the power conundrum. As per a June 2022 report, 40-50 per cent of Myanmar’s territory was already outside Tatmadaw’s control. This number is estimated to have increased given regular reports of the military losing control of areas, including important infrastructure and trade hubs. In such circumstances, India risks being left out of any meaningful engagement with Myanmar if it continues to only engage the junta.

China Challenge

India’s approach is predominantly attributed to balancing China’s presence in Myanmar. On this front, however, India is lagging behind quite significantly.

China is Myanmar’s foremost trading partner and accounted for 26 per cent of all trade volume in 2022-23. Its post-coup defence supplies amount to US$ 267 million as opposed to India’s US$ 51 million. These include light attack aircraft and advanced trainer jets as well as aluminium, copper, rubber, etc. for domestic weapons manufacturing. Additionally, China’s Myanmar strategy is not junta-centric. By communicating with the EAOs and the NUG, China takes cognisance of the volatility of the power struggle in Myanmar. This helps secure their interests and prepares the conditions for future influence should there be a shift in authority.

Such a multi-stakeholder lens is missing from India’s approach. While it is neither feasible nor desirable for India to cut the junta off entirely, it makes good strategic sense to diversify engagement. India must therefore simultaneously engage the NUG and other stakeholders, while retaining access to the junta.


The economic, political, and strategic returns on investment that India likely envisaged in exclusively engaging the junta have eluded it. Further, this positioning contradicts India’s avowed commitment to the principles of democracy, liberty, and justice.

During Myanmar’s previous struggle for democracy, India was firmly aligned with the pro-democracy movement, with no interaction with the then military government. Over time, New Delhi acknowledged the strategic flaw in sidelining a central stakeholder, which led to the initiation of contact with the military. This is the learning curve we need to look to in reshaping our Myanmar strategy.


Fiona Raval is a Research Intern with IPCS’ South East Asia Research Programme (SEARP).