Where does India’s Neighbourhood Relations stand at the end of 2025?

“You can change your friends, but not your neighbours.”

This quote from former PM Atal Bihari Vajpayee denotes the importance of neighbourhood relations for any country in the world, let alone India. India’s neighbourhood relations, guided by the “Neighbourhood First Policy,” has undergone a pragmatic evolution over time, advancing towards strategic engagements while also simultaneously defending its sovereignty and upholding its moral ideals. This article adopts a progressive analytical lens to determine India’s position in its neighbourhood geopolitical landscape at the end of 2025.

Improved Neighbourhood Relations

India-Afghanistan relations, which were strained after the Taliban's takeover of Kabul in 2021, witnessed a new sunrise in 2025. The Taliban’s ministerial visit to India and India’s upgrade of the Kabul embassy signalled India’s pragmatic engagement without political endorsement of its regime. This also shows India’s intention to slowly reshape Afghanistan’s political atmosphere through strategic diplomacy rather than social distancing.

The Maldives’ relations with India became the highlight of 2025, which profoundly shifted from President Muizzu’s initial “India Out” campaign to the current “India First” approach. This was made possible by India’s calm and persistent efforts to rebuild trust through various initiatives such as extending financial support to ease Male’s debts, providing digital integration by launching UPI and Rupay cards, and rekindling critical developmental projects, including the Great Mali Connectivity Project. And further, PM Modi’s visit as the “Guest of Honour” for the 60^th anniversary of the Maldives became a defining moment that reaffirmed New Delhi’s commitment towards its Indian Ocean neighbour in Male.

For Sri Lanka, which historically oscillated between India and China, 2025 proved India to be a more reliable partner. The strategic ties between the two nations were solidified by PM Modi’s Colombo visit in mid-2025, underlining India’s commitment to support Sri Lanka’s economic recovery and strengthen connectivity and security in the Indian Ocean Region. Furthermore, India’s swift response and humanitarian assistance at the time of the grave crisis brought by Cyclone Ditwah in late 2025, secured New Delhi a spot over Beijing as Colombo’s first responder.

India-Bhutan ties, historically administered by the “1949 Treaty of Friendship,” further deepened in 2025. PM Modi’s bilateral visit to Bhutan as the “Guest of Honour” on the eve of the 70^th Anniversary of the 4^th King of Bhutan, father of the current king, enhanced trust, and cultural ties. In addition, their sectoral partnerships, including the inauguration of the 1020 MW Punatsangchhu II hydroelectric project, intensified the strategic cooperation between the two neighbours.

2025 also saw a slow shift towards normalization phase between India and China. The thawing of tensions between both were marked by border de-escalation measures, resumption of diplomatic engagement through special representative dialogues, and reviving people-to-people contacts by restoring flights, visas, and pilgrimage. However, occasionally, hostility also emerged when China falsely claimed to have brokered peace between India and Pakistan in the May 2025 War, and when it detained an Arunachal Pradesh traveller in Shanghai airport citing the absence of a Chinese passport. These acts by China have added pessimism to the normalization process, signalling New Delhi to be more cautious and calculated in future engagements with Beijing.

Degraded Ties with Neighbours

Indo-Pak ties touched a new low with Pakistan’s Pahalgam attack in April 2025, claiming 26 lives of innocent Indians. India responded with Operation Sindoor and the suspension of the Indus Water Treaty (IWT), reiterating New Delhi’s hardened stance against cross-border terrorism. On top of that, Pakistan’s claim of the USA, China, and Saudi Arabia’s mediation to attain a ceasefire, which India firmly denies, further dented the ties. Moreover, the Pakistan Army’s consolidation of power through the 27^th Constitutional Amendment, deal with the USA for advanced military procurement, and its strategic defence agreement with Saudi Arabia at this time signals India’s need to prepare for the worst in the near future.

The ouster of ex-PM Sheikh Hasina from Bangladesh in 2024 came as a significant blow to historical India-Bangladesh relations. Further, the influx of illegal migrants, the interim government’s renewed Pakistan ties, its demand to extradite the fugitive ex-PM, and rising anti-Indian sentiments within Bangladesh’s population have posed a significant challenge for bilateral relations as well as for regional security. Bangladesh, besides being India’s largest trading partner in South-East Asia, is also a crucial link for north-eastern states to access the Bay of Bengal. So, India’s future engagements with Bangladesh’s new political architecture, increasingly carved by Gen-Z students, must go beyond historical 1971 Liberation War Legacy-based diplomacy to more pragmatic, opportunity-based, and transactional bilateral engagement.

Calibrated Engagements

Despite intensifying conflicts between the military junta and ethnic armed groups in Myanmar in 2025, India has maintained a calculated working relations with the junta for strategic and security purposes. India was forced to reinforce security along the northeast border, especially by suspending the free movement regime (FAR). At the same time, New Delhi supported the ASEAN-led efforts to bring political resolution within Myanmar. Besides, the elections in Myanmar in 2026 on a promise to restore democracy, is expected to bring in more formal, pragmatic, and calibrated engagement between both nations, especially in trade and connectivity sectors.

India-Nepal ties, despite the Gen-Z revolution in Nepal in 2025 leading to the ouster of PM K.P. Sharma Oli-led coalition government, remained largely stable while also alert. With new, young generation of political actors emerging in Nepal with no prior established ties with India, it remained uncertain for India to move forward with its diplomatic outreach. Yet, India’s tactical move with RBI reforms in late 2025, permitting Indian banks to lend in INR to Nepalese entities to reduce currency volatility and enhance cross-border investment, has strengthened ties. And again, like in Myanmar, the new elections in 2026 to restore democracy will also enhance the opportunities for India-Nepal to foster cooperation, especially in sectors such as connectivity and energy.

To sum up, India, in 2025, has carefully navigated through considerable uncertainties in its neighbourhood terrains by revitalizing long-standing partnerships, retaliating against cross-border adventurism, and recalibrating its strategic positions and priorities. On moving forward in 2026, the lessons learnt last year require New Delhi to carefully cultivate in engagements and pragmatically adapt its diplomacy style to favourably reshape its neighbourhood architecture.

What challenges do you think India might face in its Neighbourhood landscape in 2026? Do comment below!