South Asia

SOUTH ASIA
RISK REVIEW 2020

South
Asia
Religion: World's largest population of Hindus,

Jains and Sikhs, 676 million Muslims,
AFGHANISTAN 76 million Buddhists, 40 million Christians
NE Military Power (Standing Army): India 1,362,500,

PA BHUTAN
PAKISTAN L Pakistan 637,000, Myanmar 406,000,
Sri Lanka 202,500, Bangladesh 160,000
INDIA Population: 1.87 bn (25% of world's population).

MYANMAR Most Populated Cities: Delhi, Karachi, Mumbai,
BANGLADESH and Dhaka
Growth Rate: 5.9%
Area 5.1 Million sq km (11.51% of Asia)
SRI LANKA
GDP: USD 3.5 Trillion
MALDIVES Life Expectancy: 69

Risk Matrix
Risk Rating Internal Political Economic Natural

Infrastructure
2020 Security Stability Stability Disasters
Afghanistan Vh H M L M
Pakistan Vh H H M M
India M M L M M
Nepal L L M H M
Bangladesh M L M H H
Bhutan L L L H M
Myanmar M M M L L
Sri Lanka H L M H M
Maldives L L L M M
Vh VERY HIGH H HIGH M MEDIUM L LOW VL VERY LOW
Disclaimer: MitKat's risk ratings are a quantitative and qualitative product of the likelihood of risks and their impact on the conduct of business. This rating may differ
significantly from the national average, for specific regions within countries.
South Asia Risk Review 2020 www.mitkatadvisory.com

Geopolitical and geo-economic turbulence, endemic in the South
Asian region, continued in 2019 and is likely to manifest in the similar
Chairman's vein in 2020. Certain important events of this year are likely to cast
their shadow on the strategic dynamics, and exacerbate further, the
inherent fissures and fault lines in the ensuing year. The 2019
parliamentary elections in India though offered continuity on one
hand, but on the other the loud and vitriolic campaign polarised the
Message fractured polity even more. The election of Mr Modi and the
revocation of Article 370 in Kashmir and realignment of state
boundaries evoked a shrill response from Pakistan and some other
nations. Earlier India had raised the stakes in a high gamble air strike
on terror targets in Balakot, Pakistan in Feb 2019; and changed forever
the status quo of the fragile LOC between the two countries. The
China-Pakistan nexus got further strengthened, and this axis is likely
to dominate the geopolitical discourse of the region. The tentative
'quad' grouping to counterbalance China and the BRI would further
strain the insecurities of the dominant players.
The election results in Sri Lanka and the return of the Mr Gotabaya
Rajapaksa (perceived as pro-China) as president, would further
enhance tensions in the region and may even fuel unrest in the Tamil
dominated areas. The continued ascendancy of Taliban in Afghan
politics and its increasing proximity to Pakistan military establishment
and China would be another area of concern. Furthermore, the
economic downturn in both India and China would create more push
for protectionist tendencies. India's walkout from the powerful RCEP
trade block emphasises the trade related tensions which may come to
the fore. The security architecture of the region would continue to be
stable militarily, with terrorism as the main threat. Overall, 2020 would
continue to witness strategic fragility and turbulence, while showing
medium to steady economic growth with many opportunities.
Climate change triggered calamities would need monitoring and
mitigation in the region. The overall security scenario would be
reasonably stable especially so in the rest of the SAARC region.
Lt Gen Sudhir Sharma

PVSM, AVSM, YSM, VSM (Retd), Chairman
CONTENTs
Executive Summary 1
Afghanistan 7
Bangladesh 14
Bhutan 21
India 24
Myanmar 33
Pakistan 38
Nepal 45
Sri Lanka 50
The Maldives 55
South Asia Risk Review 2020 www.mitkatadvisory.com

Executive Summary
2019 for South Asia has been one of the more eventful years On the economic front, South Asia too saw a big flux in 2019.
in the past decade. 2019 witnessed the first trans Line of While the economy of Pakistan has come to a historical low,
Control air attacks between India and Pakistan after almost India and Nepal have revived their economies ten years after
five decades, one of the worst terrorist attacks in about a the global economic crisis to become some of the fastest
decade in Sri Lanka on Easter Sunday. Jamaat-ul- growing economies. Bangladesh continues to remain one of
Mujahideen Bangladesh is hailed by experts as one of the the fastest growing economies in the region with its GDP
most advanced, criminally minded and crafty terrorist growth rate forecast at 8% in 2020. South Asia remains the
organization in the sub-continent. The Taliban revived itself region with one of the highest growth rates, and one of the
as a major player in Afghanistan for the first time since their largest markets with youngest work force.
removal from power in 2001. On the political front, India saw
major political and constitutional reforms, while Sri Lanka Against this backdrop of geopolitical and economic
and Maldives have seen new governments. Pakistan challenges coupled with massive opportunities in market
continues to grapple with uniformed democracy in new growth and capitalization focus, it becomes important to
ways. Nepal's growing closeness with China, seen alongside carefully evaluate the risks of doing business in South Asia.
China's increasing role in Sri Lanka and Pakistan too has India MitKat's South Asia Risk Review 2020 brings to you an in-
worried. depth geo-political analysis of the major issues affecting
each country in the region, the influence of external powers
Terrorist Incidents in South Asia in domestic markets and political space, as well as a forecast
for the coming year based on trend development and
analysis.
2500
2126 2119 2092
1954
2000
1720
1414
1500
1000
607
500 323 274 263
64 81 135 94
10 7 49 13
0
INDIA AFGHANISTAN PAKISTAN SRI LANKA NEPAL BANGLADESH
2017 2018 2019 Source: Our World in Data
South Asia Risk Review 2020

1 www.mitkatadvisory.com
Executive Summary
New Risks for a New Decade
As we enter a new decade, the world at large finds itself at a whom join various terrorist and extremist groups spread
societal, economic and environmental tipping point. Growth across South Asia. Disruptions to business operations
in manufacturing economies slows down, economic from terrorist threats would continue to remain high in
inequalities rise, and climate change takes place at a faster 2020.
pace than before, simultaneous we see an increase in
radicalized movements, particularly against immigrants and Ÿ Technology
minorities. There is also a growing disbelief in the capitalist Technological risks would encompass the constant new
system, and a backlash against pace of technological innovations that outpace each other, rendering slow
developments and dwindling number of elites that control adoption of any technology into business a more futile
an even larger share of the global market. These trends get and expensive exercise. The integration of new and
mirrored in South Asia. emerging technologies such as artificial intelligence,
machine learning and big data development and
These geo-political and geo-economic trends put management, if not managed properly would expose
governments in South Asia in a bind, with increasing businesses to various compliance and financial risks.
pressure to find new ways to deal with new risks as they are
emerging, or risk losing business with companies holding Ÿ Economic Flux
back investments and changing supply chains to avoid Geo-economics, and in particular the effect of shifting
certain countries. We therefore see five persistent risks for political strategy towards short-term economic goals
2020 in South Asia: would see multiple countries in South Asia facing an
economic flux. This can be expected to manifest in the
Ÿ Civil Disturbance/ Activism form of shifting economic policies, vulnerabilities in
Protests, riots, and violent activism across the countries market transactions, and changes in repo rate and
can be expected to pose as one of the most important currency rates based on political decisions.
risks to business continuity in South Asia. As civil
dissonance grows, and avenues for protest under the Ÿ Environmental Risk
democratic system increase, civil disturbances can be Fast-paced climate change with resultant extreme
expected to remain one of the most persistent risks for weather phenomenon, as well as shifting environmental
2020. regulations imposed by governments due to political
pressure from activists, international platforms, as well as
Ÿ Terrorism and Extremism genuine concerns can lead to business disruption.
Each country of the region faces persistent threats from
increase in radicalized groups and individuals, many of

Executive Summary
Interconnected, Interdependent, & yet under External Influence
As we move ahead with high levels of globalization achieved Region, so global powers can be expected to lessen their
in the past two decades, it is unlikely that South Asia would hold, while maintaining a high level of influence.
be able to focus on these risks without any influence from
the larger, global trends – or that it even should. While Social cohesiveness, economic stability and environmental
acknowledging the influence that all countries and sustainability will become more important centers of focus
international developments have on governance, politics, for both political and economic health of the countries in the
and economy of a country, or a subcontinent, South Asia is sub-continent. These new aspects, along with more
more influenced by trends and power overshadow of two of traditional threats of terrorism and cross-border proxy wars
the three major power centers of the world – United States that affect all countries of the region, may be enhanced.
and China. Developments in technology such as big data, 5G telecom
systems, artificial intelligence, cyber centrality, and the all-
As the stature of India continues to grow internationally as a powerful tool of social media, (which allows a platform for
stand-alone power, Pakistan, Afghanistan and Nepal are people to be radicalized, plan and conduct attacks, and
being brought closer into the ambit of China through its Belt spread rumours about economic/ social issues) would
and Road Initiative (BRI). Sri Lanka will try to make an continue to disrupt perceptions in the region.
independent stand due to its location in the Indo-Pacific
Trends in Relations between South Asian Countries, USA & China in 2019
INDIA AFGHANISTAN BANGLADESH BHUTAN MYANMAR PAKISTAN NEPAL SRI LANKA MALDIVES
INDIA
AFGHANISTAN
BANGLADESH
BHUTAN
MYANMAR
PAKISTAN
NEPAL
SRI LANKA
Maldives
UP Down No Change
Source- South Asia: Pair-wise correla on for bilateral rela onship

Executive Summary
AFGHANISTAN BHUTAN
2020 for Afghanistan promises to be a big year. After the new For Bhutan, agriculture, hydropower, inland waterways, jobs,
President is announced in November 2019, US, Russia and urbanisation, and international relations – are some of the
China will try at various levels to commence negotiations most sensitive and important issues in the region for the
with the Taliban, and ISIS-Khorasan is starting to develop near future. Economic relations between India and Bhutan,
new relationships for information sharing and operations among other things, are based on harvesting Bhutan's
outsourcing with local militants. Uneasiness between the potential to generate hydropower for both external trade
various partners in the government will remain, as will the and domestic use. In the near future, economic growth in
country's bargaining position with the major powers of the Bhutan is forecast to strengthen moderately, supported by
world. It is possible that the situation and political leadership the industry and services sectors. However, strengthening
levels may change post the annual summer offensive by the domestic resources toward better funding of development
Taliban (yet to be announced). remains a challenge.
BANGLADESH INDIA
Volatility is expected to prevail in Bangladesh as the ongoing 2020 is expected to be a year wherein further reforms and
discussions on the expatriation process of the Rohingya implementation can be expected by the government.
refugees has been prolonged by the Bangladeshi and Instances of civil disturbance are likely to subside with
Myanmar governments. Demands for wage increases are support for the main opposition visibly reducing.
likely to drive industrial unrest in Bangladesh garment Strengthening of bi-lateral ties with other nations can be
manufacturing sector. Other triggers for violent protests expected, while India-Pakistan relationship will continue
include various student demands. Noticeably, there has witnessing its complexities. The impact of climate change is
been a shift in the demands by the students from political evident and government machineries will have to be active
issues to fighting for a better road and transport system. to ensure minimal impact due to natural calamities.
Having said that, Bangladesh's economy is forecast to
continue to expand in 2019 and 2020 fiscal year with
stronger performance by internal and external sectors.

Executive Summary
MYANMAR NEPAL
In late 2020, Myanmar will hold general elections. The run up The year 2020 may witness further increase of proximity
till elections could witness increase of violence perpetrated between Nepal and China. 2020 also looks like a good year
by ethnically driven insurgents, high risk of conflicts and for Nepal and India to strengthen their ties with the oil
clashes, intensification of Rohingya crisis, to name a few. pipeline coming into picture. The 69 km pipeline will
Chances of ideological conflict between military and current transport fuel from the Barauni refinery in Bihar to
government cannot be ruled out. Ethnic insurgencies, Amlekhgunj in South-East Nepal and is the first cross-border
Rohingya crisis, illegal minning, drug trade and a regime petroleum product pipeline in South Asia. This shared
change will continue to affect the country's security interest could further lead to a competition between China
dynamics. and India in the region. GDP growth is projected to an
average of 6.4 % over the medium term. In terms of natural
hazards and calamities, Nepal is susceptible to earthquakes
and floods, changing monsoon patterns, and the region
needs to prepare for more weather extremities: severe
PAKISTAN drought and intense rainfall in 2020.
2020 may prove to be one of the more unstable years for

Pakistan. While politically the country seems more stable
than ever, with the Army Chief reinstated, in sync with the THE MALDIVES
civilian government of Imran Khan (who wields control over
Tehrik-e-Taliban Pakistan) and order restored within the ISI,
there are now more external destabilizing elements more
With the return of political stability in 2019, the year of 2020
than ever. It is possible that the economic crisis may trigger
poses to be a promising one for Maldives both economically
the need for the Pakistani Army to correct the course of the
and politically as multiple reforms and joint projects are
economy and domestic politics. The army may simply extend
anticipated to be implemented. A slew of measures are
its control over the civilian government, in an attempt that
expected to be implemented by President Solih which aims
this would help them get more funds and bailouts.
at increasing the country's tourism in 2020. India-Maldives
ties are projected to solidify with increased cooperation
between the two countries.

Executive Summary
Global Competitiveness Report 2018-19
SRI LANKA
South Asia Rank
With Gotabaya Rajapaksha winning the presidential
elections, we can expect the new government to look to
convert the country's geostrategic position into an India 58
economic advantage, without compromising the nation's
territorial integrity; trying to balance the influence of China,
India and the United States. China is likely to increase its
economic assistance to Sri Lanka under its Belt-and-Road Sri Lanka
Initiative to protect its multibillion dollar investments and its
85
strategic foothold. Growth is estimated to accelerate next
year, buoyed by an expected recovery of tourist numbers.
Moreover, the IMF program should support business
sentiment and fixed investment. Global trade tensions and a Bangladesh 103
large fiscal deficit, however, pose downside risks. Climate
variability and sea level rise could bring inclement weather
conditions to the country such as heavy rainfall and floods
over time.
Pakistan 107
Nepal 109
Source- The Global Compe veness Report 2018-2019, WEF

RISK MAP RISK RATING
INTERNAL
SECURITY
POLITICAL
STABILITY
ECONOMIC
STABILITY
NATURAL
DISASTERS
INFRASTRUCTURE
VERY HIGH HIGH MEDIUM LOW VERY LOW 2020 2019 2018 2017
Area 652864 sq km Population 38.04 mn GDP Growth Rate 2.7 % GDP 19.99 bn USD
Disclaimer: MitKat's risk ratings are a quantitative and qualitative product of the likelihood of risks and their impact on the conduct of business. This rating may differ significantly from the national
average, for specific regions within the country, and from one business to the other.
AFGHANISTAN
Presidential Elections 2019 Resurgence of Taliban
The fourth presidential elections in Afghanistan since the fall The Taliban today is a resurgent force in Afghanistan. 18
of the Taliban in 2001 took place on 28 September 2019 years after they were thrown down from power, the Taliban is
amidst increasing violence and threats from the Taliban. today being courted by all the major powers of the world
While the electoral process and run-up to the elections saw –the United States, Russia, and China. At the same time,
nearly 100 election-related incidents with civilian casualties other militant groups in the Afghanistan-Pakistan region are
across the country, the day itself recorded no mass casualty bending over backwards to develop an alliance with the
event. group. As people and businesses in the region begin to feel
the threat of violence again, it's imperative to analyse what
The 2019 elections saw one of the lowest turnouts since happens next.
2001. An estimated 20 % of eligible voters went to the polls.
According to the Afghanistan Analysts Network, there were Once dislodged from power by the United States (US) in
more than 400 reported attacks across Afghanistan as the 2001, the group simply became scattered, weak, and
country voted, but none were significant enough to have disorganized. The smaller cells of the then-declared-terrorist
disrupted the polling. group continued to attack the US forces stationed in
Afghanistan, leading to hundreds of deaths over the years.
On the day of elections, 91 polling stations were attacked. It The opportunity for rebranding came two fold. First, the
was also reported that a "Mumbai-style attack" involving menace of Islamic State (ISIS) came up in 2014, diverting the
more than a dozen attackers with their sights set on Kabul world's attention away from all the other terrorist groups.
was thwarted just before the election. With little to no attention being given to the Taliban, they
could secretly regroup and re-strategise. Second, American
The 2019 elections suffered from other drawbacks as well – government under Trump announced its intentions to
incomplete or missing voters list, non-functional biometric withdraw from Afghanistan. Pakistan, scared of losing the
identification systems in many places, and more than 2000 incoming funds for fighting terrorism, soon restarted its
polling booths did not open for voting due to coercive Taliban programme – again under the auspices of the interior
pressure from the Taliban. The militants also attacked ministry, which had led to the birth of the group in the first
communication towers to take down mobile phone place.
networks, cutting off 1000 polling stations from HQ in Kabul.
What to expect: It is highly unlikely that the Taliban would
suddenly decide to sit quietly and allow democratic process
to take shape. With the increase in its funding, material
supply, and courting from intelligence organizations of the
US and Russia, they will continue to escalate violence.

AFGHANISTAN
Taliban Control in Afghanistan Internal Security
Afghanistan is presently governed by a system best
described as 'Cinderella control'. In essence, the term refers
to the way that the present government is fighting back
against the Taliban getting more and more control over the
country – officially. The government is in power over the
entire country and has a system of taxation, laws, order, and
administration. However it is the Taliban in power. They have
their own set of rules and understandings, taxation policy for
anyone wishing to live or work under the areas where the
militant group holds control, and their own system of
administration, including delivering 'justice'. According to
the Long War Journal, out of 398 districts in Afghanistan, the
government only controls 133 districts, with most of the
others being under full control of the Taliban (i.e.,
government operators either do not go there or have to
DISTRICTS
adhere to the policies of the Taliban), or are contested.
196
200
The pattern of violence in such collapsed states does not

150 133 focus on coercion of society into supporting the 'cause'
100
espoused by the Taliban, or even full utilisation of available
68 resources and insurgents to overthrow the government and
50 establish control. Rather, the focus has shifted to extortion,
1 mayhem, and terror. The choosing of such procedural goals
0
Government Taliban Contested Unconfirmed over any outcome goals by the insurgent groups, Taliban and
ISIS-Khorasan being the frontrunners, has led to complete
instability and an upturning of the concept of internal
POPULATION
security. With the state's forces on the back foot due to lack
2,00,00,000
1,51,57,565
1,38,66,168
of consistent training, good equipment and political
1,50,00,000
backing, it is unlikely that they would be able to focus on
1,00,00,000
issues of internal security. With the Taliban increasing their
39,39,742
50,00,000
43,004
attacks on armed forces personnel, their rule in the country
0
Government Taliban Contested Unconfirmed
will persist in the times to come.
Source- Afghanistan Ministry of Mines and Petroleum

AFGHANISTAN
US and Afghanistan
US and Afghanistan do not share a very comfortable These new schisms are being effectively used by the Taliban
relationship. Responsible for regular bombings, attacks, and and ISIS-Khorasan to re-establish themselves as those who
international force, the US today is also responsible for can give any kind of physical security to the people. Added to
keeping any civilian government in power and ensuring that this is the fact that the US government is keener to have a
the Taliban and al-Qaeda do not settle in Afghanistan. dialogue with the Taliban, rather than the government in
power, on any plans for how it should withdraw or discuss
However, this relationship has taken a turn under Trump's the future of the region.
presidency. There is a renewed focus on getting out of the
'endless war', while ensuring that the US still gets to have a
say in all matters in Afghanistan without being there. While Afghanistanʼs Natural Resource Endowment
this shift has received focus within the US, the conversation Areas of Interest (AOI)
has generally tended to focus on financial aspects of United
States' continued presence in Afghanistan and the health of
American troops.
It would be a few years, for the US troops to withdraw from

Afghanistan. Extent of investments made, length of the
conflict, as well as the security of their troops will dominate
all discussions and decisions. Additionally, it is highly unlikely
that any government in the region, save Pakistan, would
support a Taliban government. The status quo of the uneasy
relationship with the Taliban trying to tip the scales with
escalatory targeted violence is likely to continue in the
foreseeable future.
Afghanistan remains a fragile state. Democracy has not

Source- Afghanistan Ministry of Mines and Petroleum
taken full root in the society that is still governed by tribal
rules and allegiances. Tribal allegiances, while having
historical precedent, is also based on wealth and security
that the tribe can provide. With the US moving out, and the
money flow to certain tribes and key personnel drying up,
there has been a shift in the internal politics of the country.

AFGHANISTAN
China and Afghanistan China's Projects and Investments in
In recent years, China has been expanding its presence – Afghanistan
both diplomatic and economic in Afghanistan. The shift from
the policy of 'calculated indifference' to a more proactive BILATERAL
engagement comes at a time the US is receding from the Mes Aynak Copper Mine contract
political domain and China's Belt and Road initiative is
Amu Darya Oilfield Refinery
coming into fruition in its neighboring countries.
Republic Hospital in Kabul
China has invested heavily in Afghanistan, with a focus on
Repair work for the Parwan Irriga on System
extracting minerals and developing infrastructure projects,
which can be taken over at a later date if need be (similar to Teaching building, hostel, and auditorium in Kabul University
the case of the Hambantota port in Sri Lanka). It has invested Na onal voca onal training center
to the tune of USD 4.4 billion in the copper field of Logar, oil
Highway development in Kunduz-Jalalabad
exploration in Amu Darya, apart from developing a cross-
country railway link, that would help connect Afghanistan Repair and reconstruc on work of the Kabul-Jalalabad Highway
with its central Asian republic nations.
Repair and reconstruc on work of the Bamiyan-Samangan Highway
Even as China is eagerly entering Afghanistan for its rich Customs building in Torkham
mineral resources, there are concerns about the level and Huawei and CTE involved in op cal-fiber na onal grid development
type of investments made by China in Afghanistan. China's
interventions in the political and the economic sphere seem
CHINA-AFGHANISTAN-PAKISTAN UNDER CPEC
to be motivated more by the chronic instability of the
country rather than out of sheer goodwill. Instability, and
Peshawar-Kabul motorway
lack of control by the government over mines and other
resources would not only allow China to buy in the resource Landi Kotal-Jalalabad railway
areas for a low cost but also allow it to bring in its own
military to guard it. Given that China is an all-weather ally of Chaman-Speen Boldak railway
Pakistan, which continues to fund terrorist activities in
Hydropower dam on Kunar River,
Afghanistan, it can be almost assured that there are no
attacks on any China-owned investment. With continued Turkmenistan-Afghanistan-Pakistan electricity transmission line
instability in the country, it is highly improbable that
Afghanistan can pay China its dues for various projects Trans-Afghan highway to Central Asia from Peshawar, Pakistan
under construction – allowing China to 'repossess' any
project at a later date. Logar-Torkham railway line
Source- China Daily

AFGHANISTAN
India and Afghanistan Drug Trade
India and Afghanistan share a long-standing status-quo Despite years of struggle and billions of USDs spent fighting
relationship based on mutual respect. While it has been narcotics, Afghanistan continues to see increasingly high
speculated that India's strong relationship with Afghanistan levels of narcotics production and movement. The U.N.
has only been based on Karzai's deep ties with the Indian Office on Drugs and Crime (UNODC) in 2018 estimated that
elite, the fact is that there are much deeper geo-strategic 263,000 hectares of land produced 6,400 metric tonnes of
undercurrents to all actions that are being seen as opium in 24 of Afghanistan's 34 provinces. The efforts to
benevolent. wipe out the crop have been meagre and just 406 hectares
were cleared last year, hampered in part by expanding
The most visible of ties between the two countries is the Taliban control over larger parts of the country.
long-term investments made by India for Afghanistan's
infrastructure development projects, such as schools, roads, Opium production levels are increasing in Afghanistan. This
electricity power plants and transmission lines, as well as the is due to complex system of Afghanistan's war economy. The
Parliament or Loya Jigra. The infrastructure projects are poppy plant from which the opium is produced, is easy
those that connect other Indian projects with major cities, or enough to grow, requiring very little by way of investment.
are based in areas of major influence of top political With thousands of economically weaker farmers in
leadership of Afghanistan, ensuring that India remains the Afghanistan, there will always be people willing to get into
main focus instead of Pakistan for these individuals. India is the trade requiring small investment with large returns.
also developing many of its projects near or in conjunction Growing poppy for the Taliban affords the farmer additional
with Iran, again as a buffer to Pakistan as well as ensuring it protection and insurance that he won't have to deal with the
forms a new triad. Developing relations with the local government authorities. Once harvested, the main process
populations through such projects also ensures that India of turning the sap into a 'core' powder is the only difficult
continues to be looked upon favorably with future part; which is controlled by the Taliban.
generations as well.
Heroin production benefits the conflict economy, especially
The Taliban Angle: With the Taliban wanting a clear timeline the Taliban, and sometimes even Islamic State. According to
of the withdrawal of US forces so that it can march back into Special Inspector General for Afghanistan Reconstruction
power, India needs to re-calibrate its approach towards a (SIGAR), more than half of opium production takes place in
Taliban government it never recognized. India's calculation high insurgency areas. From the process mentioned above,
would not only have to take into account its investments in losing a few pounds, or a few men to the massive anti-drug
Afghanistan, but also whether a stable and economically activities by the US forces, makes little difference to the
robust Afghanistan is in its interests. If so, it will need to Taliban. There are far too many poor willing to cultivate
accept certain new harsh realities poppy after 18 years of war.

AFGHANISTAN
Women and Children Conditions of Women and Children
The American-led war in Afghanistan was perhaps the only
war that was conducted under the official name of women's 46%
1 in 18
rights. The narrative propagated was bought the world over: Children fail to reach
Children aged 12 to 23
their first birthday months have not received
the Taliban were using ancient means to torture women, they their basic vaccines
had no rights, and America as the beacon of freedom in the
world needed to step in to save them.
1 in 3 2 in 5
18 years down the line, the status of women in Afghanistan Children cannot reach their
Girls are married before
has not changed. A 2015 report notes that almost 90% of full mental or physical
their 18th birthday
development
women in Afghanistan have suffered from domestic abuse.
UNICEF notes that about 1 in 3 girls are married before their
18th birthday and that 19% of females under 15 years are
literate. Almost 50%
1 in 4 improved drinking water
Children is underweight sources are contaminated
Afghanistan has always been a more traditional and with fecal ma er
patriarchal society. In 2001, once the war was officially over,

the US tried to 'rebuild' Afghanistan into a 'democratic
country for liberal women' and sent in multiple NGOs
Over 4 million
1.3 million
focusing on women's employment. As the number of women Children under the age of
people s ll prac ce open
5 years need treatment
working in offices increased, and number of men decreased, defeca on
for acute malnutri on
the traditional moral values of the society were challenged.
As a result, there was an uptick in the number of domestic
violence cases – incidents of men beating up their wives in
order to regain control in an already fractured world. 3.7 million Only 19%
Children are 'Out-of-School' females under the age of
60% of them are girls 15 years old are literate
The NGOs fighting for women's rights and liberty, backed by
the US administration, will undoubtedly continue their
efforts, despite the enormous backlash received from
prominent feminists and scholars studying Afghan society.
14 cases 31% of
As long as traditional values are not integrated in the Children are 'Out-of-School' Adolescent girls
redevelopment projects, it is likely that incidents of violence 60% of them are girls are anemic
and manhandling within Afghan homes will continue.

Source- UNICEF

AFGHANISTAN
Ease of Doing Business Outlook for 2020
2020 for Afghanistan promises to be a big year. After the new
0 50 100 150 200 President is announced, US, Russia and China will try at
various levels to commence negotiations with the Taliban,
EODB
(Overall Ranking) 173 and ISIS-Khorasan is starting to develop new relationships
for information sharing and operations outsourcing with
Starting a Business 52 local militants.
Dealing with These events promise that Afghanistan will see a different
Construction Permits 63 183 status-quo. Uneasiness between the various partners in the
government will remain, as will the country's bargaining
Getting Electricity 173 position with the major powers of the world. However, the
stakes have drastically shifted. The government is no longer
Registering Property 186 the sole contender for power, or the only authority in the
country that is recognized as a legitimate authority.
Getting Credit 104 By starting bilateral talks with the Taliban, without the
involvement of the Afghan government, the US ensured that
Protecting
Minority Investors 140 the militant group is viewed as an equally legitimate partner,
sidelining the government it had once helped establish. It is
possible that the situation and political leadership levels may
Paying Taxes 178
change post the annual summer offensive by the Taliban (yet
to be announced). At this point, it seems that the uneasiness
Trading across Borders 177 and high tension environment will mark Afghanistan for the
time to come.
Enforcing Contracts 181
Resolving Insolvency 76
Source: World Bank

INTERNAL
SECURITY
POLITICAL
STABILITY
ECONOMIC
STABILITY
NATURAL
DISASTERS
INFRASTRUCTURE
Bangladesh
Political Outlook
The two major political parties in Bangladesh, Awami League The Awami League is likely to remain in power in the next five
(AL) and Bangladesh Nationalist Party (BNP), have years, owing to its overwhelming majority in parliament. The
dominated the political scene since the nineties. Both parties party's established system of patronage at local level, as well
draw their support from the same political class, and have as its strong command of the armed forces, will strengthen
close historical links. There is great tension, both on the party its rule. Nevertheless, the political environment will be
and individual level, between the leaders of the two parties, characterised by frequent events of social unrest. However,
Sheikh Hasina (Awami League) and Khaleda Zia (BNP). The these events are not expected to undermine economic
polarisation and hostility between AL and BNP continues activity and forecast real GDP to grow by 7.8% between
and the opposition frequently uses traditional “hartals” (civil 2019/20-2022/23.
disobedience and general strikes) as political weapons.
Political demonstrations often end in violent clashes
between different groups. Epidemics and Pandemics
The BNP, while being the second-largest political party in Bangladesh experienced a massive outbreak of dengue in
Bangladesh, remains unrepresented in the 350-seat the year 2019. The total number of fatalities in the country
parliament; the Jatiya Sangsad, however, after the 18 party since January stands at 93, according to a report of the
alliance that it led boycotted the 2014 general elections. country's Directorate General of Health Services (DGHS).
Khaleda Zia, a two-time Prime Minister, was jailed for five
years on 08 February 2018 for misusing more than Dhaka was at the centre of the outbreak this year as it has
USD250,000 from a charity named after her husband, former thousands of under construction building sites, which turn
President Ziaur Rahman. Since Bangladesh's Constitution into pools of stagnant water during monsoon season and
expressly prohibits a person to be sentenced to more than become a breeding ground for mosquitoes. Dengue spread
two years from participating in elections, the verdict against to 63 out of Bangladesh's 64 districts, affecting a total of
Zia effectively barred her from running in this 2018 general 1,845 patients outside of Dhaka.
elections. It was an unequal electoral war with the Awami
League winning with a clear majority. Following the eleventh According to an index compiled by the Economist
parliamentary elections the BNP-led opposition gradually Intelligence Unit, Dhaka, notorious for traffic congestions
weakened. Bangladesh, yet again, appears to be back to a and pollution, is world's third-least liveable city. Some 60% of
one-party system. With both major parties gradually residents live in makeshift structures, according to the
adopting the strategy of forging electoral alliances with Centre for Urban Studies (CUS). Many of these slum-dwellers
smaller parties in order to pull in additional votes, virtually lack access to clean water and sanitation and are at constant
wiping out the possibility of the emergence of a credible risk of eviction. In such conditions diseases-especially
third party or an electoral alliance in the country. waterborne ones- thrive. Frequent bouts of illness that stop

Bangladesh
Refugee/Rohingya Crisis
slum-dwellers from working keep them trapped in poverty. According to a United Nationsʼ report published in February
This hampers the wider economy, according to researchers. 2018, approximately one million Rohingya refugees fled
Myanmar to avoid the violent ethnic cleansing. These
There is also an environmental cost. Everyday 1.1m cubic refugees moved into temporary settlements in Bangladesh's
metres of sewage are pumped into Dhaka's rivers. As the city Cox Bazar. The Rohingyas are a stateless Muslim minority in
has expanded into nearby wetlands, a natural drainage Myanmar. Their exodus began in August 2017, when
system has been destroyed increasing the risk of floods. violence broke out in Myanmar's Rakhine state.
Further, pollution levels generally remains high in Dhaka and Bangladesh was initially reluctant to open its border to
Chittagong, affecting people prone to allergies. Stomach Rohingya refugees, but succumbed under international
upsets are common for visitors to Bangladesh, and malaria is pressure. In the coming year, Awami League will have bigger
a serious risk in the Chittagong Hill Tracts region. challenge to face with the increased political pressure
mounting on the government to address the issue of the
Other mosquito-borne diseases in Bangladesh, including refugee crisis.
certain areas of Dhaka, have reported cases of chikungunya
over the last few years. Chikungunya is a viral disease Arakan Rohingya Salvation Army (ARSA), the militant group
transmitted by mosquitoes. Malaria occurs throughout rural whose attacks on Myanmar security posts in late 2017
areas and outbreaks of other mosquito-borne diseases triggered the army's indiscriminate attacks and ethnic
occur in many areas. cleansing, has pledged to continue its insurgent campaign
against, what they call, Myanmar state-sponsored terrorism.
The ARSA is continuing to consolidate its authority within
Number of Dengue Cases in Bangladesh the sprawling refugee camps. Their rate of recruitment is on
the rise, making it a grave security concern for Bangladesh.
100000 93590 The possibility of ARSA to try to recruit within the camps of
90000
80000
Cox's Bazar and the chances that they might use the camps
70000 as a base for cross-border terrorism, cannot be ruled out.
60000
50000
40000 The Bangladeshi authorities regulate access to the areas

30000
where the Rohingyas are accommodated. There have been
20000
10148
1749 3162
6060
2769
reports of insecurity, protests and some violence, including
1359
10000
1151 472 409 641 375
0 civil disorder from both the local community and camp
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Source- Control Room, DGHS
population following the murder of a local political leader,
believed to have been committed by criminal gangs. Teknaf

Bangladesh
Key Figures of Rohingya Refugee Crisis
(in Coxʼs Bazaar) currently sees the highest level of drug 211,383
related gang violence across Bangladesh, with frequent 914,998 Families
Total Refugee Population
murders and shooting incidents between the gangs and law
enforcement agencies. Drug seizures are common and Yaba
(a mixture of caffeine and methamphetamine) is often found 80% 42% 3% 3%
Women Adults Specific Elderly
in very large quantities. Kidnapping and an increase in and Children (18-59) Needs (60+)
violence have also been noted in these areas, especially in
the Teknaf area camps since August 2019.
55% 387 31 3%
Children Staffing Partners Camps under
The local Bangladeshis allege that the refugees have also (0-17) UNHCR Management
changed the demographics of Bangladesh's Ukhia and Source- UNHCR
Teknaf areas. Reportedly, in these regions, Rohingya's now

outnumber the locals by a ratio of 2:1. Also, the Kutupalong Age and Gender Breakdown of Rohingyas
camp is the largest and most densely populated refugee
0-4 5-11
settlement in the world.
Bangladesh authorities do not want the Rohingyas to 48%

assimilate into the local population. Camps are educating (437,113)
the refugees in English and Burmese, but not Bengali.
Similarly, new refugees are barred from Bangladeshi
citizenship, neither through birth nor marriage. The birth
52%
rate among the Rohingyas is much higher than that of
(477,885) 86215 83471 105374 99961
Bangladeshis. The cramped conditions in the refugee camps
also raise the concern of water-borne and other 12-17 18-59 >60
communicable diseases that might spread beyond camps.
Additionally, this refugee crisis also creates a risk of
trafficking for sex, drugs and labour.
62220 61626 169110 216816 14194 16011
Male Female Source- UNHCR

Bangladesh
Civil Unrest
Demonstrations and localised industrial disputes are bus. Raising issues of road safety, the protests sparked
common which often escalates into violence causing deaths, substantial levels of violence and virtually paralysed normal
injuries and significant property damage. However, life in the region affecting mobile internet services and
nationwide strikes (locally known as hartals) have contributing to transport disruption and vandalism. 2019
significantly reduced in the country since early 2019. was no different, when thousands of university students
Though, transport networks may be blocked and essential from across the country staged protests and blocked major
supplies such as fuel can be difficult to get during sporadic roads in October after an undergraduate was beaten to
demonstrations across the country. death, allegedly by ruling party activists, for criticising the
government over a water-sharing deal with India. Protests
Small-scale improvised explosive devices (IEDs) and firearms broke out at several universities in Dhaka and the northern
have been used by some protestors in the past and city of Rajshahi following the killing of Abrar Fahad of the
demonstrations are frequently accompanied by violence Bangladesh University of Engineering and Technology.
targeting public transport or private vehicles traversing in
the affected area. Being the second of its kind, the anti-quota The agitation for minimum wages by the garment workers
protests of April 2018 also left a significant impact on the has also been a significant factor leading to shut down,
Bangladeshi authorities. consequently disrupting business operations in the country.
From road blockades, rallies, hunger strike and destruction
In July 2018, massive protests by school and college students of property; the garment workers protests have posed a
were witnessed in the capital city of Dhaka over the death of major challenge to business continuity and the government
two teenagers and 12 others being injured by a speeding thereby challenging the law and order situation as well.
Major Protests in Bangladesh in 2019
Protests over 'Blasphemous' Killing of student Violence in local Police, RMG workers
Facebook post triggers protests elections clash
50 04 01 07 15
October - Bhola District October - Dhaka March - Rangamati District January - Narayanganj District
Source- MitKat Reports 2019

Dead Injured

Bangladesh
Islamic Terrorism
Bangladesh has been witnessing a resurgence of Islamic poverty. Implementation of such principles might result in
extremism and radicalisation. The jihadist resurgence and providing impetus to extremist organisations to establish a
rise of Islamic terrorism have raised concerns for the security degree of control in the country.
and stability of the country.
After the Holey Artisan Bakery attack in 2016, the state's
Localised terrorist cells, namely Jamaat-ul-Mujahideen security presence has increased, which has led to a reduction
Bangladesh (JMB) and Ansar-al Islam, spearhead the local in the number of terrorist incidents. However, further attacks
jihadist spectrum in the country. The presence of religious in public places and targeting foreigners are possible.
extremism and prevalence of extremist ideology is not new Terrorist groups, including the Islamic State of Iraq (ISIL) and
to the country as global terrorist organisations Al Qaeda and Al Qaeda in the Indian Sub-continent (AQIS), have claimed
Islamic State have had a stronghold in the nation. Since responsibility for previous attacks and continue to make
September 2015, Islamic State has claimed responsibility for threats to conduct further attacks in Bangladesh including
a number of terrorist attacks in Bangladesh including: against foreigners. Other targets have included religious
minority groups, secular activists, academics and members
Ÿ The 01 July 2016 attack at the Holey Artisan Bakery in the of the LGBTI (Lesbian, Gay, Bisexual, Transgender, and
Gulshan 2 district of Dhaka, which resulted in the death of Intersex) community. Authorities have successfully disrupted
20 hostages; mainly foreign nationals and two police a number of planned attacks and remain on high alert.
officers. Increase in security presence and restrictions on movement
Ÿ The murders of two foreign nationals and sporadic may be put in place at short notice.
attacks against minority religious communities and
security forces, including attacks using suicide bombers. Bangladesh has a history of terrorist activities, targeted
assassinations, politically motivated attacks and, sometimes,
Further, alliance with political parties such as the opposition violent religious rivalry. Most recent significant attack was in
Bangladesh Nationalist Party (BNP) have given Islamist 2015, when resident foreigners were killed or shot at in
groups like Jamaat-eIslami an existential legitimacy. Ethnic places such as Dhaka and Rangpur, and bombs targeting
polarisation has, to an extent, created a culture of Hindu and Shia Muslim religious events in Dhaka, Bogra and
exclusivism, resulting in providing a strong argument to Dinajpur. Travel advisories issued by the government
terrorist organisations to base their propaganda. BNP has following these incidents had warned foreign nationals to
propagated the implementation of Islamic principles as the stay away from large gatherings as well as to avoid travelling
solution to societal concerns like unemployment and unescorted in rural areas.

Bangladesh
Natural Hazards
Bangladesh is considered as one of the top countries Cox's Bazar, Khagrachhari, Bandarban, Rangamati, Feni,
adversely affected by climate change and thus highly prone Gaibandha, Lalmonirhat, Nilphamari, Sylhet, Sunamganj,
to natural disasters. The flat topography of the nation, Moulvibazar, Kurigram, Jamalpur, Sherpur, Brahmanbaria,
clubbed with low-lying and climatic features as well as the Habiganj, Chandpur, and Madaripur. The flood situation also
density of the population and socioeconomic environment, affected a number of newly affected districts in the
makes it highly susceptible to many natural hazards like downstream regions of the country such as Tangail,
tropical cyclone and flooding. According to the International Sirajganj, Bogra, Munshiganj and Faridpur. Further,
Federation of Red Cross and Red Crescent Societies (IFRC), thousands of people were affected in the impacted districts
more than 4 million people are at risk of food insecurity and while rising water levels of the major rivers left people
disease because of the flooding in Bangladesh. stranded in water-logged areas putting them at risk of water-
borne diseases like diarrhoea, snake bites, skin diseases and
According to Directorate General of Health Services (DGHS), other infections.
hundreds of people died and 95 others drowned in the
floods that affected nearly 200,000 people in over 28 Bangladesh is regularly flooded during the monsoon season
districts across the low-lying country due to monsoon rains from June to September as rivers that feed into the Bay of
in 2019. The districts affected by floods were Shariatpur, Bengal burst their banks.
Rajbari, Manikganj, Munshiganj, Netrokona, Chittagong,
Flood Impact Level and Percentage of Population Affected

100 94.3
90
80
70
60
50
46.7
40
30 21.7 25.1
20 12.6 13.7 10.5 11.3
10
6.9
0
Jamalpur Kurigram Tangail Gaibandha Sylhet Sunamganj Siraiganj Bogura Bandarban
Source- Es mated from the NDRCC affrected popula on using BBS district wise data

Bangladesh
0 50 100 150 200 Some volatility is expected to prevail in Bangladesh as the
ongoing discussions on the expatriation process of the
EODB
(Overall Ranking) 168 Rohingya refugees has been prolonged by the Bangladeshi
and Myanmarese governments. Refugees are now based in
an already densely populated area, where the poverty rate is
Starting a Business 131
well above the national average, causing a considerable
pressure on natural resources. This can lead to disturbances
Dealing with
Construction Permits 155 in Cox's Bazar, Teknaf and other areas.
Getting Electricity 176 Terrorism in Bangladesh has manifested itself in the past with
terrorist attacks against secular bloggers, foreigners and the
Hindu community. After the Holey Artisan Bakery in July
Registering Property 184
2016, the frequency of attack slowed down. However, risk of
further attacks against local political leaders, minorities,
Getting Credit 119 secularists and security forces are likely to remain high.
Protecting Demands for wage increases are likely to drive industrial

Minority Investors 72
unrest in Bangladeshʼs garment manufacturing sector.
Strikes are likely in Ashulia, Gazipur, and Savar with workers
Paying Taxes 151
blocking major highways connecting Dhaka to the rest of the
country. Chittagong and Mongla ports also could face
Trading across Borders 176 sustained operational disruption during intermittent strikes
by port and truck workers. Other triggers for violent protests
Enforcing Contracts 189 include various student demands.
Bangladesh's economy will continue to expand in 2020 fiscal

Resolving Insolvency 154 year with stronger performance by internal and external
sectors. At 8 % growth in fiscal year 2020, Asian
Development Bank's (ADB) outlook indicates that
Bangladesh is likely to continue as the fastest growing
economy in Asia and the Pacific. Sustained strong growth in
industry and agriculture are expected to be the main drivers
Source: World Bank
of growth in fiscal 2020.

INTERNAL
SECURITY
POLITICAL
STABILITY
ECONOMIC
STABILITY
NATURAL
DISASTERS
INFRASTRUCTURE
Area 0.038 mn sq km Population 7.6 mn GDP Growth Rate 5.3 % GDP 2.84 bn USD
Bhutan
Natural Hazards
Bhutan is a land-locked country in Southeast Asia and is past 40 years. In 2009 and 2011, Bhutan was struck by two
exposed to a diversity of natural hazards, including floods, high-magnitude earthquakes. Another area of concern are
landslides, earthquakes, glacial lake outbursts, and instances of forest fires. According to the 2017 forestry facts
droughts. The country's climate varies with its geographical and figures, Bhutan recorded 31 forest fire incidences, while,
location, but can be categorised into three main zones, 39 forest fires were recorded in 2018.
namely alpine, temperate and sub-tropical.
Thus, Bhutan's hydropower, agriculture, and tourism sectors,
The climate change phenomenon and the geographical which together account for almost a quarter of the country's
location of Bhutan places its population centres, lifelines and Gross Domestic Product (GDP), are all highly dependent on,
assets at risk to various disasters and hazards. Rainfall and affected by, climate variability and natural hazards.
patterns in the geographical area of Bhutan and Issues of climate change, and frequency of natural hazards
neighbouring countries have been changing in recent times. are prime areas of concern for the country.
Specifically, although the total volume of precipitation
remains constant, it is received over short periods of time in a
given year, i.e. increasing the probability of flooding. Epidemics
Flooding, in turn, can result in reduced volumes of
Insufficient volumes of available drinking water can result in
drinking/potable water as well as create probable flood
the spread of epidemics related to water, sanitation and
situations in the neighbouring countries, e.g. India. Heavy
hygiene that can be compromised during flooding. This is a
seasonal monsoon rainfall and glacial melts are the most
public health concern in Bhutan.
common causes of flooding and landslides.
Bhutan has managed to reduce its malaria burden from 410
Over 70 % of settlements and most developed and fertile
indigenous cases in 2010 to only six in 2018. Enhanced
agricultural land regions are located along the main
medical surveillance as well as wider geographical access to
drainage basins, placing them at a high risk of flooding.
malaria diagnostics and antimalarial medicines for the
According to Department of Roads (DoR), various locations
people have been few of the key solutions.
along 23 primary national highways (PNH) were blocked due
to landslides, falling boulders and flash floods in the month
Tuberculosis (TB) remains a major public health concern in
of July 2019 alone. Majority of the roadblocks were reported
the country. With concentrated effort, great progress has
in the central and eastern parts of the country.
been achieved in fighting against the disease. Bhutan has a
low HIV prevalence with a concentrated epidemic among
Similarly, the country has a high risk of earthquakes due to its
young people, migrant workers, sex workers and people who
proximity to the seismically active Himalayan belt. Several
inject drugs.
earthquakes above magnitude 6.0 have occurred over the

Bhutan
India-China-Bhutan Relationship
As a mark of India's neighbourhood centric approach in its steered clear of China's Belt and Road Initiative (BRI). Lest
foreign policy, External Affairs Minister Dr S Jaishankar chose Bhutan consider signing up to Beijing's ambitious plans,
Bhutan as his first country to visit after taking oath in May India will seek to keep the remote kingdom out of China's
2019. Meanwhile, Bhutan's premier was one of the leaders orbit by advancing New Delhi's own infrastructure projects
invited for the oath-taking ceremony of Prime Minister Modi in the country.
in May after he won the general elections.
During his India visit in 2019, Bhutan's Prime Minister Lotay
With China trying to build inroads into Bhutan, India looks Tshering had clearly stated that no side should do anything
towards its neighbour as a crucial ally that can help India near the tri-junction point between India, China and Bhutan
maintain a balance of power in the region. India is looking at unilaterally. For Bhutan, as long as the status quo is
many development projects in Bhutan, particularly in the maintained, there will be peace and tranquillity in the region.
hydro-power sector. More importantly, situated in the
Himalayas, Bhutan and Nepal are important buffer states From a foreign policy perspective, these remarks can also be
squeezed between China and India. seen as evidence of the fact that though some quarters in
Bhutan have been advocating equidistance between India
Bhutan is India's strongest regional ally, and it is the only and China, Bhutan views India as its closest neighbour and
country in South Asia (aside from Afghanistan) to have security guarantor.
Indian Foreign Aid to South Asia, 2019

The largest recipient, Bhutan, is not a member of China’s Belt and Road Initiative
Nepal Afghanistan Maldives Bhutan Myanmar Sri Lanka Bangladesh
110 75 60 375 50 25 20
Source: Republic of India (Ministry of External Affairs)

Bhutan
0 50 100 150 200
For Bhutan, agriculture, hydropower, inland waterways, jobs,
urbanisation, and international relations – are some of the
EODB most sensitive and important issues for the near future.
(Overall Ranking) 89
Hydropower is the centrepiece of Bhutan's economic
prosperity, accounting for 14 % of its GDP.
The expected commissioning of the Mangdechhu
Dealing with
Construction Permits 63 91 hydropower plant, strengthening of private spending, and
increased government spending following the formation of
a new government to implement the 12th five-year plan, will
Getting Electricity 78
greatly contribute to growth.
Registering Property 53 In order to fund development, the creation of a stabilization

fund to ensure even distribution of expenditure, a GST
Getting Credit 94 regime which is planned to be adopted in 2020, and reforms
on provision of fiscal incentives have been considered.
Protecting
Economic Growth Forecast

Paying Taxes 15
6.30
Trading across Borders 30
Bhutan GDP Growth (% year) 6.00
5.70
Resolving Insolvency 168 5.50
2017 2018 2019 Forecast 2020 Forecast

Source- World Bank Source: Asian Development Bank

INTERNAL
SECURITY
POLITICAL
STABILITY
ECONOMIC
STABILITY
NATURAL
DISASTERS
INFRASTRUCTURE
Area 3.28 mn sq km Population 1.37 bn GDP Growth Rate 6.5 % GDP 88,081.13 tn USD
India
Economic Outlook
At the end of 2018, India was amongst the fastest growing Moody's Investors Service has slashed its 2019-20 GDP
major economies but 2019 witnessed a downward trend. growth forecast for India to 5.8% from 6.2% earlier, reporting
The Gross Domestic Product (GDP) growth has fallen to a that the economy was experiencing a pronounced
five-year low of 5.8% in the first quarter of 2019 and the GDP slowdown which is partly related to long-lasting factors.
in India expanded 1 % in the second quarter of 2019 over the
previous quarter. Niti Aayog (policy think tank of the Additionally, India Ratings (Ind-Ra) has lowered its
Government of India) has deemed the current slowdown as projection for Indiaʼs economic growth rate to 6.1% for
unprecedented in the last 70 years and called for immediate 2019-20 from earlier estimate of 6.7%. This has been
policy interventions in specific industries. It is believed that attributed to the deceleration to an investment-led
weak consumer demand and private investments are slowdown that has broadened into consumption, driven by
reasons behind the slowdown in the economy. financial stress among rural households and weak job
creation.
The Indian government has been taking measures to ensure
that the impact of slowdown is reduced, and it has unveiled The growth is expected to pick up to 6.6% in 2020-21 and to
tax breaks for start-ups, cheaper home and car loans and an around 7% over the medium term. By international
injection of 700 billion (USD9.8 billion) into state-run banks. standards, 5% real GDP growth remains relatively high, but it
The Reserve Bank of India, which cut interest rates four times marks a low rate for India.
this year, would further transfer excess reserves of INR 1.76
trillion (USD24.5 billion) to the government.
India's Economic Growth Rate Projections
Indiaʼs automotive industry has been witnessing job cuts and
consumer goods companies are slashing prices because of
for Financial Year 2020
slowing demand. Private sector which is the mainstay of
Organisation for Economic
sustainable growth in the economy is at a 15-year low, Co-operation and Development
5.9
resulting in almost no investment in new projects by the World Bank 6

private sector. There have been various cases where
International Monetary Fund 6.1
businesses have complained about the state of the economy
and harassment by tax authorities. Measures taken in the Reserve Bank of India 6.1
past further impacted the economy, as the government
Asian Development Bank 6.5
withdrew all high-value banknotes from circulation
overnight and new indirect taxation system of the Goods & Economic Survey 7
Services Tax (GST) was initially difficult for small business 5.4 5.6 5.8 6 6.2 6.4 6.6 6.8 7 7.2
owners. Source - Respective Agencies

Source: World Bank
India
Jammu & Kashmir Unrest
A presidential decree issued on 05 August 2019 revoked The country braced for extensive protests after the
Article 370 of India's constitution that guaranteed special announcement of abrogation of Article 370, however strict
rights to the state, including the right to its own constitution security measures and strong governance have curtailed any
and autonomy to make laws on all matters except defence, kind of civil disturbance so far.
communications and foreign affairs. In the lead-up to the
move, India sent thousands of additional troops to the All Central laws and State laws of Jammu & Kashmir now
d i s p u te d re g i o n , i m p o s e d a c u r f e w, s h u t d o w n apply to the new Union Territories of Jammu & Kashmir and
telecommunications and internet, and arrested political Ladakh. The police and public order is to be with the Centre.
leaders.
Post the repeal of the Article 370, doors to private
The Jammu & Kashmir Reorganisation Act, 2019 contains investment in Jammu & Kashmir would be opened, which
provisions to reconstitute the state of Jammu and Kashmir would in turn increase the potential for development;
into two union territories, called Jammu & Kashmir, and increased job creation and further betterment of socio-
Ladakh. The act officially came into effect on 31 October economic infrastructure in the state.
2019.
The abrogation of Articles 370 and 35A by the two Houses of New Boundaries of Jammu & Kashmir
Parliament of India with a two-thirds majority, led to a
predictable denunciation from Pakistan; and a range of
responses from an expression of understanding of India's
case to a positive support of the move from the international
community. The US, Russia, France and many other countries
POK
confined themselves to counselling India and Pakistan to
reduce tension and sort out any issues relating to Kashmir Line of Control
Aksai Chin
through bilateral dialogue. Line of

Actual Control
Kupwara Bandipur
Muzaffarabad
Further, the move has worsened the already-heightened Baramula
Ganderbal
Srinagar Kargil LEH
LADAKH
tensions with neighbouring Pakistan, which downgraded its Punch
Badgam
Shopian
Pulwama
Anantnag
diplomatic relations with India. Though the degree of Kulgam
Kishtwar
autonomy enjoyed in practice by Kashmir has been much Mirpur
Rajouri
Reasi
Ramban
reduced over decades by repeated state level interventions, Jammu

Udhampur
Doda
it was nonetheless of huge symbolic importance to the local

population. Source- MitKat maps

India
Natural Disasters and Extreme Weather Phenomena
In 2019, India has witnessed extreme weather conditions On 19 June, Chennai declared “Day Zero” or the day when
which can be attributed to climate change and inadequate almost no water was left as all the four main reservoirs
infrastructure in the subcontinent. In this scenario, the supplying water to the city had run dry primarily due to
extreme weather conditions have become a new normal. deficient monsoon rainfall in late 2017 and 2018. Chennai is
India faced a myriad of disasters in 2019 ranging from floods, amongst the 21 Indian cities which the Niti Aayog (policy
droughts, dust storms, fog and cyclones. think tank of the Government of India) fears will run out of
groundwater by 2020.
In 2019 India witnessed a series of floods that affected 13
states in late July and early August due to incessant rainfall. In May, Cyclone Fani, made landfall near Puri, Odisha with
At least 200 fatalities were reported and about a million winds gusting at more than 190kmh. Due to good disaster
people were displaced. Karnataka and Maharashtra were the preparedness, the loss of lives was low, however the impact
most severely affected states. The other states which faced a in terms of loss of homes and livelihoods was enormous.
severe impact are Himachal Pradesh, Uttarakhand, Uttar
Pradesh, Kerala, Gujarat, Madhya Pradesh, Tamil Nadu, Goa, By the first week of June, the country underwent 73 spells of
Odisha, Andhra Pradesh, Punjab, Assam and Bihar. Among heatwave, 11 of them severe. The heatwave was the
these Pune, Vadodara and Northern Karnataka experienced strongest in Maharashtra, Madhya Pradesh and Rajasthan.
major loss of life and property. Humidity compounded the problem in coastal states like
Odisha and Andhra Pradesh and Telangana and even in non-
In February, a massive forest fire broke out in numerous coastal Bihar. In June, Tropical cyclone Vayu also hit the
places across the Bandipur National park of the Karnataka western coast along Maharashtra and Gujarat. Torrential
State in India. The total extent of the burnt area was rains in Himachal Pradesh and Uttarakhand triggered flash
estimated to be about 10,920 acres. The fire also spread to floods in the Himalayas. In November, cyclone Bulbul hit
Mudumalai Forest. Odisha and West Bengal causing major loss to life and
property in the two states.
In April, India witnessed unseasonal weather phenomena
from thunderstorms to heavy rainfall in the states of Air pollution levels continue to be a major concern in metro
Rajasthan, Gujarat, Andhra Pradesh, Odisha, Telangana and cities, especially Delhi-NCR region, despite measures being
Tamil Nadu among others. Indian Meteorological taken by the state governments.
Department (IMD) had blamed the phenomenon of western
disturbance for inclement weather conditions resulting in There is a shift in natural disasters in India and there is an
heavy loss of life and property. urgent need to broaden perspectives, with roots in resource
management practices.

India
Left Wing Extremism
Left-Wing Extremists (LWE), are also known as Maoists and Though the number of incidents of LWE violence has come
Naxalites in India. There are more than 30 Left-wing down in the recent past, continued efforts and focus are
extremist groups in operation in the country. Some of them needed in eliminating such groups. Innovative measures are
have consistently followed a violent agenda, rejecting required to be employed in preventing IED (Improvised
parliamentary politics. Some others have been participating Explosive Device) related incidents which have caused
in the democratic processes with considerable success, while significant casualties in recent years. States play a vital role in
some maintain underground cadres, but also participate in maintaining law and order. So, emphasis is being laid on
parliamentary politics. capacity-building and modernization of the local police
forces.
The objective of the Naxalites is to wage an armed
revolution, modeled on the lines of the Chinese Revolution,
Left Wing Extremism Affected States
which they call New Democratic Revolution (NDR), and usher
in their own form of government.
Jammu & Kashmir
According to the Ministry of Home Affairs (MHA), there are

90 districts and 11 states which are affected by Left Wing Himachal
Pradesh
Extremism (LWE). The states which continue to be impacted Punjab
by LWE are Andhra Pradesh, Bihar, Chhattisgarh, Jharkhand, Uttarakhand
Haryana
Kerala, Madhya Pradesh, Maharashtra, Odisha, Telangana, Delhi Arunachal
Pradesh
Uttar Pradesh, and West Bengal. The degree of impact of 3

Sikkim
Rajasthan
Naxalism varies in all the mentioned states with Uttar Pradesh

16
Assam
Meghalaya
Nagaland
Bihar
Chhattisgarh, Jharkhand, Odisha and Bihar being the Manipur
Tripura
hotbeds. Gujarat Madhya Pradesh
2 19
Jharkhand 1 Mizoram
West
Bengal
14
Chhattisgarh 15
There have been various upliftment programs initiated by Odisha
3
both the state government and the Union government in Maharashtra
8
tandem, with ensuing operations by armed and paramilitary Telangana
forces which has resulted in the mass surrender of LWEs

including their commanders. Intersectional analysis of the Goa 6
Karnataka Andhra
Pradesh
same reveals a decrease in morale amongst LWE operatives
after the surrender of their leaders.
Tamil
Nadu
3
Kerala Number of Districts Affected
Source: Government of India, Ministry of Home Affairs

India
Insurgency in North East India
North Eastern India has been facing challenges due to There exists a deep nexus between all the insurgent groups
insurgency for nearly 5 decades, but things are now settling in the Northeast. It is still very common in the region to
down and peace has started to prevail in the last couple of experience isolated incidents of extortion and kidnapping
years. even though the overall impact has reduced considerably.
Further, extortion by the militant groups on the national
Security situation in the region has improved considerably in highways that connect the different states with mainland
Assam and Meghalaya in particular, for facilitating India has shot up the prices of essential commodities. In the
conducive atmosphere for investment and development. oil-rich Assam, militants have periodically targeted oil and
The Northeast Industrial Policy initiated by the Government gas pipelines for sabotage, alleging that India is exploiting
of India has further contributed in encouraging investment the natural resources of the state.
and industries in the region. However, the Northeast will not
be able to attract large-scale industries because the region is The year 2019 oversaw a wrap up of negotiations between
resource deficient and does not have economies of scale to the Government of India and Nagaland's political parties,
match. also known as the Naga Peace talks. Several decades of
deliberation between the two sides came to a historic
The argument around the validity and requirement of the conclusion on 31 October as a framework agreement was
National Register of Citizenship in Assam has been the cause chalked out. Special provisions are slated to be introduced to
of major protests and demonstrations by groups supporting allow flexibility towards representing Nagaland's ethnicity,
it and those against it. While the list was published this year recognizing the state's unique history and culture. Details of
in August, a large fraction of the society was excluded from the concluded agreement are yet to be announced by the
the same. There is a possibility that this would become a Union Government.
nationwide phenomenon soon. Rohingyas also serve as a
growing threat to the North eastern as many of these Moreover, the security situation in the whole of the region
refugees are without jobs and could fall prey to radical has not improved uniformly. The ceasefire agreements have
ideologies. They may join the Harkat-ul-Jihadi Islam (HuJI) led to a reduction in the militancy-related fatalities in their
which has been accused of carrying out bomb blasts in respective states but a road map toward a situation of a
Assam. Another aspect could be the fear of a major spill over permanent agreement is desired from government of India
of the conflict into India's north-east in terms of refugee flow (GoI). Insurgent incidents are still frequent in several areas
from across the porous Bangladesh-India border. The north- and it can be assumed that their activities also go
east is a region plagued by armed ethnic conflicts based on unreported. Business organisations with interests in the
issues of land and identity, further inroads by a refugee region are still advised to take adequate precautions.
population could exacerbate the situation in the north-east.

India
India Conflict Map
KASHMIR ASSAM ARUNACHAL PRADESH
All Parties Hurriyat Conference Harkat-ul-Mujahideen (HuM), IK Communist Party of India-Marxist-Leninist-
(APHC), Jammu & Kashmir Songbijit faction of National Democratic New Democracy (CPI-ML-New Democracy-
Liberation Front (JKLF), Lashkar- Front of Bodoland (NDFB-S), Muslim Chandranna), National Liberation Council of
e-Jabbar (LeJ), Lashkar-e-Omar United Liberation Tigers of Assam Tani Land (NLCT)
(LeO), Mutahida Jehad Council (MULTA), United Liberation Front of
[(MJC). Asom-Independent (ULFA-I), People's
NAGALAND
VERY LOW
Democratic Council of Karbi-Longri
(PDCK), Rabha National Liberation Front National Socialist Council of Nagaland - Isak-
Jammu & Kashmir
(RNLF), United People’s Liberation Army Muivah (NSCN-IM), Non-Accordist Faction of
PUNJAB (UPLA), United Democratic Liberation Naga National Council (NNC-NA), Naga
Himachal Army (UDLA), Tiwa Liberation Army Rengma Hills Protection Force (NRHPF)
Khalistan Tiger Force (KTF) Pradesh (TLA), Rabha Viper Army (RVA), Karbi
Punjab Land Protection Force (KLPF), Dimasa
Uttarakhand
National Liberation Army (DNLA).
VERY HIGH
MANIPUR
Haryana
BIHAR North West
West
North
North
East
Shahdara
Delhi Coordination Committee (CorCom), Hmar
Arunachal
Central
Sikkim
East
South West
New Delhi
South
East
South
CPI(M), People’s Liberation Front Pradesh People's Convention- Democracy (HPC-D),

of India (PLFI), Tritiya Prastuti Rajasthan Uttar Pradesh National Socialist Council of Nagaland - Isak-
Assam
Committee (TPC) Bihar Nagaland Muivah (NSCN-IM), People's United
Meghalaya
Liberation Front (PULF), Zeliangrong United
Manipur Front (ZUF), Maoist Communist Party –
MIZORAM Jharkhand Tripura
Manipur (MCP-M), Zomi Re-unification
Gujarat Madhya Pradesh Mizoram
West
h
gar
Hmar National Army(HNA) Bengal Organisation (ZRO), Thadou People's

ttis
Liberation Army (TPLA), National

ha
Ch
Orissa
MEDIUM LOW VERY LOW
Revolutionary Front of Manipur (NRFM),
MAHARASHTRA Maharashtra Manipur Naga Revolutionary Front (MNRF),
Zomi Revolutionary Army (ZRA), Kuki
CPI (M) Telangana
National Front (KNF), Kuki National Liberation
Front (KNLF).
TELANGANA Goa Andhra
ODISHA
Pradesh MEGHALAYA
CPI(M), CPI(ML- Janshakti), CPI (M)
VERY HIGH
Communist Party of India- Karnataka

Hynniewtrep National Liberation Council
Marxist-Leninist-New Democracy (HNLC), Liberation of Achik Elite Force (LAEF),
(CPI-ML-New Democracy- WEST BENGAL Achick Songa An'pachakgipa Kotok (ASAK),
Tamil
Kerala
Chandranna) Nadu
CPI(M) United Achik Liberation Army (UALA), Achik
VERY LOW
National Liberation Army (ANLA), Achik

National United Force (ANUF), Achik Tiger
JHARKHAND Force (ATF), Achik National Liberation Co-
People’s Liberation Front of India operative Army (ANLCA), Achik Matgrik Elite
KERALA TAMIL NADU (PLFI), Tritiya Prastuti Committee Force (AMEF), United Achik Matgrik Army
(TPC),Jharkhand Jan Mukti (UAMA), A'chik National Cooperative Army
CPI(M) CPI(M) Parishad (JJMP) (ANCA).
Source: SouthAsia Terrorism Portal

India
Civil Disturbance
2019 witnessed several major protests and strikes in the first Members of the medical fraternity protested in June 2019.
half of the year before the 2019 general elections dominated Following the assault of two junior doctors at Nil Ratan Sircar
political and socio-economic stage in the country. The civil Medical College and Hospital (NRSMCH), junior doctors in
disturbance movements were marked by protests by unions, Kolkata demanded West Bengal Chief Minister Mamata
political parties and religious groups. Banerjeeʼs intervention to ensure adequate security to
medical professionals. Healthcare facilities were disrupted
To begin with, a two day nationwide strike was held on 08-09 between 13-17 June as doctors protested countrywide.
January by 10 central trade unions which heavily impacted
the banking industry for a few days. In March, another In August, a meeting called at Ramlila Maidan by Dalit
nationwide shutdown was called demanding the Centre to leaders ended up in a violent protest at Tughlakabad, near
secure forest rights to tribals, job security for ad hoc teachers the site of Ravidas temple. Close to 100 people were
and to protest the anti-reservation policy of the central arrested, including Bhim Army chief, Chandrashekhar Azad.
government. The tribals were protesting a Supreme Court
order evicting more than 10 lakh tribal families and other The protesters turned violent when police did not allow
forest-dwellers from forest lands across 16 states. them to proceed to the site of the temple demolished by the
Delhi Development Authority on the orders of the Supreme
Looking at the proceedings of the government, the Lok Court. Police had to resort to mild baton-charge and fire
Sabha in January passed the Citizenship (Amendment) Bill tear-gas shells to disperse the crowd.
which was later lapsed on 03 June as the Lok Sabhaʼs term
came to an end. There were continued protests since January In September 2019, the transport organisation United Front
especially in the Northeastern states where there was of Transport Associations (UFTA), comprising of 41
popular resentment among people and political leaders. associations and unions, had called for a one-day strike
against various provisions of the amended Motor Vehicles
In October, the BJP-led central government proposed to (MV) Act. The protest had turned out to be unruly in several
reintroduce the Citizenship (Amendment) Bill again. The Bill, parts of New Delhi as transport workers forced passengers
in its present form, seeks to declare Hindus, Jains, Sikhs, out of taxis and autos.
Buddhists, Parsis and Christians from Afghanistan,
Bangladesh and Pakistan eligible for citizenship. Both the The Congress staged protests in several parts of Karnataka
times, severe protests were witnessed in the North-east, following the arrest of senior party leader DK Shivakumar in
especially in the states of Nagaland, Arunachal Pradesh, September by the Enforcement Directorate in a money
Manipur and Assam. laundering case.

India
Civil Unrest in India 2019
In October, the state of Telangana witnessed several days
long indefinite strike by the Telangana State Road Transport Jammu & Kashmir
corporations (TSRTC). The strike affected travel within the 2438
state. Himachal
Pradesh
2074 178
Punjab
In November, protests led by the Coordinating Committee Uttarakhand
Haryana 154
on Manipur Integrity (COCOMI) in various parts of Manipur 484 Delhi
Sikkim
Arunachal
532 Pradesh 164
were witnessed over the Naga Peace Talks between the Rajasthan Uttar Pradesh
35
Assam 1682
Union Government and Nagaland's political parties that 251 1108 Bihar 39 Nagaland
291 Meghalaya
concluded on 31 October. 164 963 Manipur
Jharkhand
Gujarat Madhya Pradesh 1437 472 Mizoram
307 West Tripura 39
186
Although 2019 has experienced several significant protests 375
Chhattisgarh
Bengal
and strikes, there has been a reflection of strong governance. 59 Odisha

559
The same reflects in the law and order situation post Maharashtra
485
landmark announcements / judgements including Telangana
1058
abrogation of Article 370 in Jammu & Kashmir and the much
Andhra
delayed announcement of the Ayodhya verdict. Goa Pradesh
134 923
Karnataka
765
Tamil
Kerala Nadu
609 1410
Source: ACLED Data

India
Ease of Doing Business Outlook 2020
100
India has added over 1,100 start-ups in 2019 and continues
Overall Ranking 77 to be the 3rd largest start-up ecosystem in the world.
63
Moreover, Indian start-up ecosystem is geared up for 10x
SCORES
136
growth trajectory by 2025.
52
India has the 2020 budget to look forward to since the
Enforcing Contracts
172
163
National Democratic Alliance has a majority and they are
163
bound to come up with changes. Economically experts
143 predict upward GDP growth in the latter part of 2020.
68
2020 is expected to be a year wherein further reforms and
172
Paying Taxes 121 implementation can be expected by the government.
115
Instances of civil disturbance are likely to subside with
Protecting Minority 13 support for the main opposition visibly reducing.
7
Investors 13
Strengthening of bi-lateral ties with other nations can be
44
Getting Credit 22 expected, while India-Pakistan relationship will continue
25
witnessing its complexities. The impact of climate change is
138 evident and government machineries will have to be active
154 to ensure minimal impact due to natural calamities.
26
22
Dealing with 185

52
Construction Permits 27
155
136
2019 2018 2017
0 50 100 150 200
Source - World Bank

INTERNAL
SECURITY
POLITICAL
STABILITY
ECONOMIC
STABILITY
NATURAL
DISASTERS
INFRASTRUCTURE
Myanmar
Rohingya Crisis
In 2017, more than 7,00,000 Rohingya Muslims fled This was the second failed attempt to start repatriation of
Myanmar during a military operation. The international Rohingya refugees. The people cited lack of accountability
organisations termed the exodus as 'textbook ethnic for atrocities committed in 2017, and uncertainty over
cleansing'. Reportedly, the Myanmar authorities continue to whether they would get freedom of movement or
deny their troops involvement in carrying out ethnic citizenship, as their main cause for not returning. More than
cleansing and genocide and have claimed that they have 40 humanitarian organizations working on the ground in
taken some refugees back. Bangladesh, in the beginning of 2019, warned that returning
the Rohingya to their homes now would be dangerous and
The government has claimed to have worked towards the premature. A UN fact-finding mission warned in a report
repatriating process, in collaboration with Bangladesh. published in September 2019 that some 600,000 Rohingya
However, many international organisations found, after remaining in Myanmar still face a serious risk of genocide.
analysing satellite images, that at least 40 % of Rohingya
villages damaged by the 2017 violence have since been
completely demolished. Also, they questioned
Top Rohingya Host Countries
government's claim of preparations for a large-scale refugee
return by citing poor conditions of transit camps like Hla Poe
Kaung, and relocation camps like Kyein Chaung.
PAKISTAN MYANMAR BANGLADESH SAUDI
The rhetoric of Myanmar government regarding Rohingya 450000 850000+ more than 1.6 M 470000
population is still constructed around latter being seen as 15,000 IDPs
(internal displaced people)
Bengalis, who, according to the government, arrived in
waves of illegal immigration over the past 70 years. Contrary
to government claims, there is little evidence of such
immigration. Additionally, the government has refused
Rohingya requests for citizenship and freedom of movement THAILAND MALAYSIA AUSTRALIA US
and is willing to give them what are called National 5000 200000 5000 5000
Verification Cards, which it says could be a step towards
eventual citizenship. But most Rohingyas reject these cards
because they would be required to identify themselves as
Bengalis. Strikingly, in August 2019, none of the 3,450
UAE EU INDIA INDONESIA
people, approved by the Myanmar authorities as refugees,
agreed to return to Myanmar. 50000 3000 50000 1200
Source: Rohingya Solidarity Organozation

Myanmar
Political Scenario Ethnic Insurgencies
Myanmar will hold general elections in late 2020 for more Ethnic conflicts have emerged as one of the most
than a thousand seats in Union, state, and regional challenging issues in Myanmar. Continued violence has left
legislative bodies. Political positioning has begun in earnest, hundreds of thousands displaced and fatalities estimated in
affecting important governmental decision-making. The the hundreds. The Northern Alliance (the Arakan Army (AA),
lead-up to this election overlaps with the 21st Century Ta'ang National Liberation Army (TNLA), the Myanmar
Panglong peace process and the possible repatriating of National Democratic Alliance Army (MNDAA), the Kachin
Rohingya refugees in ways that only deepen social tensions. Independence Army (KIA), have escalated their fight with the
military in Myanmar. In the Northern Myanmar's Kachin
Reportedly, President U Win Myint and State Counselor Daw state, new recruits are joining groups such as the Arakan
Aung San Suu Kyi will contest the 2020 general elections. Army which has set up training camps in Kachin state, home
Article 64 of the Constitution forbids the state leaders from to fellow Nor thern Alliance member, the Kachin
participating in the party's activities, which means, the two Independence Army (KIA).
are barred from conducting political campaigns for the
election. On 15 August 2019, Myanmar insurgents killed at least 15
people, most of them members of the security forces, in
In ethnic-minority areas, particularly Rakhine State, there is attacks on an elite military college and other government
growing disillusionment with electoral democracy that targets in the country's north. The Northern Alliance claimed
could fuel escalating violence. The pre-election period of responsibility for the unprecedented attack on the Defence
political contestation will likely exacerbate ethnic tensions Services Technological Academy in Pyin Oo Lwin. The attacks
and conflict risks, particularly in the country's periphery. At mark a major escalation in a decades-old conflict in the
the same time, balloting will be a crucial opportunity to region, where several groups are fighting for greater
consolidate gains in electoral democracy – an important if autonomy for ethnic minorities. The attack represented a
insufficient step towards long-term peace and stability in rejection of bilateral ceasefire terms that the Myanmar
Myanmar. government has proposed to the armed groups. In another
incident, ethnic Rakhine rebels disguised as a sports team
As Myanmar struggles with a democratic transition that has entered in a bus in rural Myanmar and took 31 hostages on
been marred by violence and injustice, the upcoming 2020 13 October 2019.
elections could mark a pivotal moment. If the country is to
find its way to a path toward more inclusive governance, Reportedly, the hostages were mostly off-duty firefighters,
where ethnic minorities have a greater voice and lower and construction workers. The Arakan Army, which is
incentive to resort to violence, the consolidation of electoral fighting for more autonomy for ethnic Rakhine Buddhists,
democracy will almost surely be an important step along the did not claim the responsibility, but chances of their
way. involvement cannot be ruled out.

Myanmar
Illegal Mining
In the negotiations that were taking place between AA, TNLA Myanmar is endowed with natural resources like gas, gems,
and MNDAA (they call it the 'Brotherhood' alliance), the and timber. Initially, these resources were overseen and
Army's main demand has been that the three groups should controlled by the military, fueling corruption. However, in
go back to their original places - the Arakan Army to Laiza, 2016, the civilian government pledged to change the
the MNDAA to Kokang and the TNLA to the Palaung Self - scenario. One of the first measures taken by the government
Administered Zone, before any bilateral ceasefire could be was imposing a licensing freeze on the mining of precious
agreed. This is unlikely to happen in the near future and stones, and in early 2019 it passed a new gemstone law.
prolonged dispute between the three groups on one side
and the Army on the other is expected to continue for a long In spite of the recent progress, many issues remain status-
time. The prevalent Rohingya crisis further complicates the quo. Myanmar jade is still being smuggled across the border
situation as it now serves as a breeding ground for the to China in large quantities despite the government having
insurgents. In the coming year of 2020 this prolonged ethnic suspended new licences since past two years now. That
conflict would continue to hamper peace and economic implies the existence of a large and illegal jade industry
development of the country, as Myanmar still lacks means which the authorities are currently ill-equipped to control. In
and measures to tackle it. recent years, taxes on gems and jade have increased.
As a result, traders are bypassing for unofficial routes. Lack of

GDP Growth Forecast for 2020 legal avenues, such as expos and auction houses, through
which Myanmar traders can sell jade and being unable to
6.8 Myanmar GDP Growth (% year) 6.8 control the production and to know exactly the production
rate in tonnes, are also reasons behind illicit jade smuggling.
Additionally, the military continues to dominate politically

and economically, retaining its grip on the country's
6.4 extractive sectors. For example, reportedly, the amber mines
in Kachin State, which have produced hundreds of
6.2
scientifically priceless fossils dating from 99 million years
ago, has been taken over by the country's military.
According to the latest report by the Kachin Development

Networking Group (KDNG), confirms the military has
2017 2018 2019 2020 resumed unregulated mining in the Hukawng Valley, where
Source: Rohingya Solidarity Organozation

Myanmar
the richest deposits are found. Apart from all this, land rights issues like corruption, involvement of state actors, as well as
still remain tenuous, especially for the rural majority who presence of middlemen who benefit from the trade, further
faces threats of displacement due to opaque and misguided complicate the situation. According to the Economist
land management laws. Reportedly, 3000 displaced people Intelligence Unit, Myanmar sits at the bottom of the Asian
from mining villages in Northern Myanmar are still living in countries when it comes to the governments' ability and
makeshift camps and being denied aid by the army. willingness to tackle the illegal trade, lagging behind Laos
and Cambodia. Only war-torn Afghanistan is a harder drugs
The responsible development of the country's vast resources theatre for the authorities to deal with.
could help Myanmar build a peaceful and prosperous future,
but only if this development is equitable and inclusive, and In recent years, Myanmar's government has started to
forms part of any durable peace process. address the rising issue of illegal drugs. on 26 June 2019,
Myanmar burned over USD 300 million worth of assorted
drug seized around the country to commemorate the
Illegal Drug Trade International Day against Drug Abuse and Illicit Trafficking.
Furthermore, they have decided to collaborate with India to
According to the United Nations Office on Drugs and Crime, fight against illegal drug menace. In July 2019, India and
Myanmar stands alongside Afghanistan as one of the top Myanmar resolved to exchange crucial information relating
illegal drug producers in the world. Reportedly, the drug to drug trafficking and precursors. In the 4th Director
cartels have shifted their emphasis away from opium and General level talks between Narcotics Control Bureau (NCB)
heroin to the modern-day methamphetamines. Shan state and Central Committee for Drug Abuse Control (CCDAC)
has long been a centre of conflict and illicit drug production held in New Delhi in July 2019, both sides shared the mutual
– initially heroin and methamphetamine tablets. Good concern regarding the menace of drugs and exchanged
infrastructure, proximity to precursor supplies from China operational level contacts for sharing real-time information
and safe haven provided by pro-government militias and in and intelligence.
rebel-held enclaves have also made it a major global source
of high purity crystal meth. The present scenario requires the government to redouble
its drug control and anti-corruption efforts, focusing on
The Myanmar authorities are considerably struggling to major players in the drug trade. Education and harm
tackle illegal trade. The limited control of the authorities, reduction should replace criminal penalties for low level
however, poses a big challenge. Reportedly, the ethnic areas offenders. The military should reform – and ultimately
where drugs are produced, primarily Shan and Kachin states, disband – militias and other pro-government paramilitary
are largely controlled by these drug cartels. Also, social forces and pursue a comprehensive peace settlement for the
state.

Myanmar
Country-to-Country Flow of Drugs Outlook 2020
In late 2020, Myanmar will hold general elections. The run up
Key Locations & Trade Routes till election could witness increase of violence perpetrated by
ethnically driven insurgents, high risk of conflicts and
United Wa Na onal Democra c Drug exports Precursors clashes, intensification of Rohingya crisis, to name a few.
State Army Alliance Army* Chances of clashes between militar y and current
MILITIAS government cannot be ruled out. Thus, the year 2020 could
1 Monekoe 2 Pansay 3 Tarmoenye turn out to be a sensitive year for Myanmar.
4 Kawng Kha 5 Manpang
Along with the upcoming elections, the repatriating of

Rohingya refugees is also going to be a major event in the
upcoming year that could directly affect peace and security
in the country. Myanmar still faces the problem of illegal
mining and drug trade. The upcoming elections could see
these issues again being brought to the forefront by the
political parties. However, how the government plans to
tackle these issues at the ground level is still unclear. The
prevalence of ethnic insurgencies has further aggravated the
problem and will continue to do so in the upcoming year.
NOTE: Cross-border arrows represent country-to-country flows of drugs and

precursors; they do not denote specific border crossing points. The
presence or absence of a par cular armed group on this map dose not
imply involvement or not in the drug trade.
*Also know as the “Mongla Group”, a er the town where it has its
headquarters.
Source: International Crisis Group

INTERNAL
SECURITY
POLITICAL
STABILITY
ECONOMIC
STABILITY
NATURAL
DISASTERS
INFRASTRUCTURE
PAKISTAN
In July 2018, Pakistan voted for the third consecutive transfer Subsequently, he also moved the decision to inaugurate the
of power from one civilian government to another – a first in Kartarpur corridor, as well as announcing the capture of
the country's history. The winner was declared to be Imran Wing Commander Abhinandan during India-Pakistan
Khan – the candidate who had the support of the armed skirmish post Pulwama attack in early 2019 – an action which
forces. defied previous trends of not revealing information about
captured Prisoners of War (POWs). They would often return
Pakistan is rumoured to be run effectively by deep state, tortured and dead.
essentially referring to organisations such as military,
bureaucracy, police, intelligence agencies and any other However, despite these instances, it seems that Khan's new
political or non- political group that works secretly to protect government has not been able to fully break out from the
their interests and rules without being elected. In the case of grasp that the deep state, and specifically the army has over
Pakistan, the prime agency is said to be the army, which the government. The Pulwama attack is a case in point. The
controls finance, and policy decisions in the country. attack was designed by the army and Inter-Services
However, Imran Khan has tried to break the mold of an Intelligence (ISI) as a way to destabilize India-Pakistan
obedient Prime Minister (PM) to the army on multiple relations and ensure that Khan's efforts could bear no fruit.
occasions. For instance, one of his first steps as a newly- For the moment, it seems that despite all the talk of Naya
inaugurated PM was to offer a change of dialogue with India, Pakistan (new Pakistan), the government, and the state will
a neighbour Pakistan shares a complex and hostile remain a 'uniformed democracy'.
relationship with.
Pakistan Elections 2018

Pakistan Pakistan Muslim Pakistan People’s Others
Tehreek-e-Insaf (PTI) League-Nawaz (PML-N) Party (PPP) Political Parties
112 seats won 61 seats won 42 seats won 46 seats won
led by : Imran Khan led by : Nawaz Sharif led by : Bilawal Bhutto Zardari
Source: Aljazeera

PAKISTAN
Pakistan-China Relationship State-Sponsored Terrorism
While China and Pakistan continue to support each other on Pakistan has increasingly become synonymous with state-
the international stage, their deep economic linkages due to sponsored terrorism. From establishing and training the
the China-Pakistan Economic Corridor (CPEC), various Afghan Mujahedeen, to organizing all the jihadist groups in
militant attacks on these installments, as well as bilateral the sub-continent under the guise of United Jihad Council
diplomatic issues have challenged their relationship. (UJC), headed by the ISI, the country has become notorious
for creating, funding, training, and harboring terrorists.
While Pakistan and China had good relations in the past, it
was only during the 1970s that their relationship While Pakistan did use terrorists during 1947 war of
strengthened. This was due to the role of the mediator Independence by sending in irregulars into Kashmir, the shift
played by Pakistan in trying to establish diplomatic started in the 1980s, when Pakistan was called upon to
relationship between the US and China under the guidance establish state-sponsored Mujahedeen group to destabilise
and leadership of Henry Kissinger. While the ideals and Soviet Union's control in Afghanistan. The project was
methods were less than pure, their relationship started to subsequently handed over to the ISI, who continue to host
take shape as one started supporting the other on the head of the Taliban in their own safe-house in Karachi.
international platforms. Since then, they have declared
themselves to be all-weather allies, and China has been a From this success sprung various other groups, with alleged
significant partner for Pakistan's economy, policy, and focus on its all-time nemesis, India. However, as controlling
defence. the actions of various groups and maintaining a separate
fund and recruitment drives for each group got difficult, they
While all seems well on the surface, there have been recent were grouped together under the United Jihad Council (UJC)
issues between the two countries that threaten to shift their or United Murtadeen Council (UMC). The group is currently
status. One, Imran Khan, prior to his election to the post of headed by Hafiz Saeed.
Prime Minister, made multiple remarks against China,
arguing that Pakistan's joining of CPEC would bring about While Pakistan has promised the international community
financial ruin as it would lead it into a debt-trap with money- that it would punish these terrorists and be in compliance
focused Chinese. with the Financial Action Task Force (FATF) rules, it is highly
unlikely that it would let go of all the power it gets over India
A notable shift could also be felt during the Xianshan by using these actors in low-intensity conflict. While certain
defence summit held in China, where a last minute speaker terrorist actors may be removed from the spotlight and their
was invited from Afghanistan to berate Pakistan on an open rallies disrupted, their funding and sponsorship from
platform. Pakistan would only become complex and untraceable. It
simply cannot afford letting go of its groups entirely.

PAKISTAN
Terrorism Attacks by Tehrik-i-Taliban Pakistan
Pakistan, in recent years, has seen an increase in terrorist 23 Dec 2007 13 killed, 25 wounded
activities on its soil. Quite separate from the various terrorist
groups that the state is known to sponsor, these are the 27 Dec 2007 01 killed, 00 wounded
groups that are targeting the Pakistani state and its
21 Aug 2008 66 killed, 70 wounded
establishments. Prime among them is Tehrik-e-Taliban
Pakistan (TTP). 10 Oct 2008 85 killed, 200 wounded
TTP is the largest militant umbrella organization targeting 30 Mar 2009 10 killed, 95 wounded
Pakistan. The group was formed in 2007 under the
leadership of Baitullah Mehsud, which started by including 09 Oct 2009 125 killed, 100+ wounded
all of the Pakistani Taliban offshoots. Based out of South
30 Dec 2009 07 killed, 06 wounded
Waziristan, the group has ties to al-Qaeda. The group has
three goals: to enforce Shariah law in Pakistan; to establish a 01 Jan 2010 105 killed, 100+ wounded
unified front to combat US-led coalition forces in
Afghanistan; and to conduct defensive jihad against 03 Apr 2011 50 killed, 120 wounded
Pakistani security forces.
13 May 2011 98 killed, 115 wounded
Ultimately, the group also seeks to overthrow the Pakistani
09 Oct 2012 00 killed, 00 wounded
government and establish an Islamic caliphate in Pakistan.
However, the group has been weakening since 2014 due to
26 Jul 2013 60 killed, 180 wounded
multiple internal splits, resulting in shifting alliances
between the different groups that are targeting Pakistan. 22 Sep 2013 81 killed, 145 wounded
Despite little centralised control over the various sub- 08 Jun 2014 18 killed, 25 wounded
groups, TTP has managed to conduct multiple successful
bombing attacks. They target schools, particularly those that 16 Dec 2014 150 killed, 114 wounded
educate girls or the children of Pakistani servicemen, in order
27 Mar 2016 74 killed, 300 wounded
to strike psychologically at its enemies. The prime example is
the 2014 Peshawar school attack, which led to 150 children 08 Aug 2016 74 killed, 100 wounded
dead. They have also conducted various suicide bombings
and hit & run raids against Pakistani Security Forces. 24 Jun 2017 62 killed, 100 wounded
04 Jun 2018 10 killed, 30 wounded Source: CISAC

PAKISTAN
Insurgency
For a country that has come to be synonymous with As Pakistan is fighting a losing battle against insurgency,
establishing and running various Jihadist organizations, China is slowly moving its military to protect its assets in the
Pakistan also faces threats from multiple insurgent and area. With the stakes increasing again, it is possible that
militant groups. either the insurgency will increase the level of targeted
violence against the Pakistan Army, or that the movement
There are currently at least three groups fighting for freedom would be brutally suppressed by the Pakistan Army, marking
in Pakistan – namely, Baloch group, Sindhi groups, and those what can only be called a genocide.
from Khyber Pakhtunkhwa. However, it is the Baloch
insurgency, or the demand for an independent Balochistan At the moment, it seems the best course of action remains to
that has the country worried. give more autonomy to the region in a manner that would
placate the top leadership, thereby ensuring that the China-
The Baloch insurgency is centered around Pakistan's illegal Pakistan Economic Border (CPEC) investments remain safe.
occupation of Balochistan after just 227 days of
independence. There have been five major uprisings in the
region: 1948, 1958, 1966, 1973, and from 2004-till date.
While the latest movement has been weakening since 2014,
Economic Crisis
there have been multiple incidents of sporadic violence. Pakistan's economy has been on a complete downturn over
the past year. And it is only getting worse. For the first time in
Beyond the obvious disturbance caused by an insurgency, over 20 years, Pakistan's debts have exceeded the size of its
the reason that the Baloch insurgency matters above all else economy. Pakistan's debt and liability have peaked to a
to the Pakistani state is, it has multiple natural reserves. As record USD 256 billion. This is a sharp increase of over 34% in
the country is facing major financial and resource crisis, it just the last 1 year that Imran Khan has been in charge.
needs to increasingly rely on the one area which has
abundant reserves of natural gas, oil, gold, and other With dwindling finances, Pakistan has been forced to look at
minerals. Moreover, a large part of the China-Pakistan external options for bailout. While Saudi Arabia and UAE
Economic Corridor (CPEC) main projects, including some of have agreed to invest in Pakistan, the IMF bailout is the main
the larger hydropower projects are in Baloch region. clincher for the country.
With the increase in insurgency and violence, the projects While the initial money has been sent, a lot still depends on
get hampered, causing further financial losses to both whether Pakistan can hold up to its commitments in various
Pakistan and China. The matter is further complicated by international forums, including the Financial Action Task
Pakistan's belief that the insurgency in Balochistan is fueled Force recommendations on terror financing. Pakistan has
by india.

PAKISTAN
Economic Crisis in Pakistan

relied on China extensively – for weapons, financing,
infrastructure development, and international support. In
fact, one of the star projects of China's Belt and Road
Initiative has been the CPEC.
The project involved China funding multiple infrastructure

and energy projects in Pakistan. However, the projects also
required Pakistan to do its share.
While the country as a whole has been facing a major

economic crisis, its military has been doing rather well. The
Fauji Foundation, owned by the army, has been recording
Internal Debt Foreign Debt
returns and profits. Moreover, the armed forces are
increasing their spend on military modernisation. USD 30.34 billion USD 18.08 billion
While it can be argued that the modernisation project is
necessitated by its old equipment, as well as recent skirmish
Note: Total Public Debt at end of June 2019: USD 204 billion
with India, the fact remains that due to the control and Source: Economic Times
influence exerted by the armed forces over the civilian

government, any funds diverted to the army cannot be
questioned. But this would only lead Pakistan further down
deeper economic crisis.

PAKISTAN
Natural Hazards in Pakistan Natural Disasters in Pakistan
Due to its varied typography, Pakistan is exposed to natural Coast of Sindh
and human-induced hazards, such as earthquakes, floods, 0.6 mn affected Cyclone
1999
droughts and landslides. While climate change has been in
part responsible for the various disasters, there is an almost
equal blame due to unplanned development in disaster- Kashmir
Earthquake loss of USD 5.2 bn
prone areas, pressure on natural resources, and heavy 2005
population burden on certain areas due to internal
migration. Balochistan
164 dead Earthquake
2008
These disasters come at a huge cost as well. The 2005
earthquake, one of the largest that country had to face, Widespread
resulted in the death of 6,700 people, indirect income losses 20 mn affected;
Floods loss of USD 10 bn
totaled USD 576 million, and relief, recovery, and 2010
reconstruction cost USD 5.2 billion. The 2010 floods, for
instance, affected the entire country devastating 78 districts Widespread
9.5 mn affected;
and affecting over 20 million people. In 2011, severe loss of USD 2.47 bn Floods
flooding affected 9.6 million people, many of whom were 2011
still recovering from the previous year. Balochistan

300,000 affected;
Earthquake 800 dead
While the government has made multiple efforts, including 2013
setting up a National Disaster Management Authority, there
is yet a strong need for these efforts to be implemented at a
Karachi
local level. Early warning systems that would identify, assess, 1200 dead Heat Wave
and monitor all natural disasters is the need of the hour. 2015
More importantly, there is a need to strengthen disaster
response mechanism at all levels. Khyber Pakhtunkhwa
Floods 55 dead, 34 injured
2016
Punjab & Kashmir

19 dead, 300 injured Earthquake
2019
Source: Aljazeera

PAKISTAN
Ease of Doing Business
180
161 156
160 151
140
123 119
120 108 112 111
100
80 72
58
60
40 28
20
0
EODB(Overall Starting a Dealing with Getting Registering Getting Protecting Paying Trading Enforcing Resolving
Ranking) Business Constructuion Electricity Property Credit Minority Taxes across Contracts Insolvency
Permits Investors Borders
Source: World Bank
Outlook for 2020

2020 may prove to be one of the more unstable years for Pakistan ISI's full control over the various jihadist groups it
Pakistan. While politically the country seems more stable funds under the rubric of United Jihad Council (UJC) has
than ever, with the Army Chief reinstated, in sync with the been declining. These groups are now increasingly looking
civilian government of Imran Khan, who wields control over for private financers with planned attack on the military
Tehrik-e-Taliban Pakistan, and order restored within the ISI – targets in India. One prime example is Dawood Ibrahim's
there are now more external destabilizing elements more alleged funding of Jaish-e-Mohamed's attack in Pulwama,
than ever. India on 14 February 2019. Attacking a military convoy can
be considered a hostile act of a state, necessitating Indian
Pakistan's economy has been on a complete downturn over military attacks in Pakistan.
the past couple of years. With the additional burden of
modernizing the military, Pakistan's budget is dwindling While we can expect Pakistan's democracy to remain
down even further. Despite the domestic economy's undisturbed in 2020, it is more probable that the army will
desperate cry for help, Pakistan's deep state believes that simply extend its control over the civilian government, in an
their focus needs to be on the military. attempt that this would help them get more funds and
bailouts.

INTERNAL
SECURITY
POLITICAL
STABILITY
ECONOMIC
STABILITY
NATURAL
DISASTERS
INFRASTRUCTURE
Nepal
Natural Hazards
Due to its location and variable climatic conditions, Nepal is According to the United Nations, Nepal is the 11th most
one of the most disaster-prone countries in the world. Every vulnerable country to earthquakes in the world, and
year, these events result in heavy loss of life and damage to Kathmandu is the city most at risk. In 2019, Nepal witnessed
properties. Climate change and an increasing population a series of flash floods that affected large areas of Nepal.
further exacerbate the impacts of natural disasters. Every Severe flooding was seen in many regions, especially in the
year, more than 1 000 people in Nepal are killed by landslides Terai area and Kathmandu. Effects included an estimated 78
and floods during the monsoon season. The potential threat casualties, loss of livestock, and significant damage to
of earthquakes, glacial lake outbursts, avalanches, and cold property and infrastructure. Many regions in the south part
and heat waves remain high. of Nepal were impacted, with highways collapsing in many
parts, including the main highway of Nepal. Rainfall induced
disasters have affected 67 out of total of 77 districts of the
country.
Humla
Darchula
Natural Hazard prone areas
Bajhang
Mugu
Baitadi Bajura
Dadeldhura Kalikot Jumla

Doti
Achham
Dolpa
Mustang
Kanchanpur Dailekh
Jajarkot
Kailali Rukum
Manang
Surkhet Myagdi
Bardia Salyan Baglung

Rolpa Kaski
Lamjung Gorkha
at
Parb
Banke Pyuthan Gulmi

Rasuwa
Syangja
Tanahu Sindhupal
Dang hanchi Nuwakot
Flood and Heavy Rainfall Arghak
Palpa Dhading
h m and
u
Chok
Dolkha
Kat Bhaktapur
Lalitp
Kapilbastu
Rupandehi
Nawal Parasi Chitwan Solukhumbu Sankhuwasabha Teplejung
Kabre
Flood
ur
Makwanpur Ramechhap
Okhaldhunga
Parsa Sindhuli
Khotang hum r
tha
Bhojpur
rat
Flood and Landslide Teh ch
at
Bara Pa
Rauth
tari
Sarlahi
usa
Udayapur Dhankuta
Maho
Ilam
Dhan
Landslide Siraha
nsa
ri
Su
Saptari Jhapa
Morang
Heavy Rainfall
Source: Nepal Ministry of Home Affairs

Nepal
India-Nepal Relations
The India–Nepal relationship is founded on strong historical, Nepal inaugurating a cross-border oil pipeline in September
civilizational, cultural, religious, social, trade and economic 2019. The 69 km pipeline will transport fuel from the Barauni
linkages. Amidst Nepal's shifting political climate over the refinery in Bihar to Amlekhgunj in South-East Nepal and is
last few decades — including the regime recent shift from a the first cross-border petroleum products pipeline in South
constitutional monarchy to a republic — India remains on Asia. The aim is to cement India-Nepal ties in the face of
balance a good neighbour. New Delhi has assisted Nepal major inroads made by China into the Himalayan nation and
during natural disasters by providing economic aid, seeks to repair the trust deficit between the two countries.
investment, education and infrastructure.
The new map of India released recently to depict the
The relationship suffered in 2015, when Nepal came up with bifurcation of Jammu and Kashmir after the abrogation of
its new constitution triggering a trade blockade on the article 370 has stirred an old controversy between India and
India–Nepal border. India felt that the new constitutional Nepal over a small 35 sq km disputed area claimed by both
provisions discriminated against the Terai people who share countries. India considers Kalapani as part of Uttarakhand's
social and family relations across the border. After this Pithoragarh district and included it within India's boundaries
incident, both sides have made serious attempts to mend in the new map whereas Nepal considers it as a part of its
the relationship. An achievement in this regard is India and Darchula district.
India Exports to Nepal (USD Million)

47.8K
48
46 45.2K
44 43.6K
42.9K
42.1K 42.2K
42 41.2K 40.9K
39.8K
40
38.8K
38
Nov 2018 Jan 2019 Mar 2019 May 2019 Jul 2019
Dec 2018 Feb 2019 Apr 2019 Jun 2019 Aug 2019
Source: Reserve Bank of India

Nepal
Economic Outlook
Gross Domestic Product (GDP) growth in Nepal is estimated trade and private consumption. In addition, high tourist
at 7.1 % in FY 2019, driven mainly by the service and arrivals expected under the Visit Nepal 2020 program, the
agriculture sectors. completion of the second international airport, and the
construction of big hotels will also support the service sector.
The service sector is likely to grow by 7.5 % due to a boost in The trade deficit is expected to decline as imports slow down
the retail, hotel, and restaurant subsectors, driven by an and exports begin to pick up.
uptick in tourist arrivals and remittance-fueled private
consumption. Agriculture is estimated to grow by 5 % in FY
2019, well above its 30-year average of 3.1 %, due to good
monsoons, increased commercialisation, availability of Exports from Nepal
fertilizers and seeds, and improved irrigation facilities. 8598.1
8600
Industrial growth is also likely to be strong at 8.1 %, well
Exports (NPR Millions)

8400
above its 30-year average of 5 %, mainly due to improved
8220.2
power availability from increased electricity generation. 8200 8145.6
Private investment and consumption are likely to be the 8000

7910.6
main contributors to growth on the demand side. However,
7800
public investment is projected to contract due to a 7666.2
slowdown in post-earthquake reconstruction and delays in 7600
national projects like Melamchi water supply and Upper Nov 2018 Dec 2018 Jan 2019 Feb 2019 Mar 2019
Tamakoshi hydroelectric. Source: Nepal Rashtra Bank
GDP growth is projected to average 6.4 % over the medium

term, driven by services and a steady inflow of remittances in
2020.
New international job markets for Nepalese migrants are

opening up, while migrants are increasingly using formal
channels to remit money.
The continued inflow of remittances will support domestic

Nepal
Tourist Arrivals in Nepal
1,03,461 85,318 48,951 28,951 28,790
INDIA CHINA USA UK SRI LANKA

Source: Department of Immigra on, Nepal
Nepal-China Relations
The bilateral relation between Nepal and China has been Among the many deals signed were plans for a 70-kilometer
friendly and is defined by the Sino-Nepal Treaty of Peace and railway connecting Nepal's capital of Kathmandu and Gyiron
Friendship signed on April 28, 1960 by the two countries. in southwestern Tibet and a road tunnel designed to shorten
Nepal-China relations have always remained friendly and the distance between Kathmandu and the Chinese border. In
cordial. Both countries have been utilising the bilateral, the lead up to Xi's visit, a series of other deals were inked,
regional and multilateral forums to hold meetings between including investments for developing an industrial park, the
the leaders in order to maintain regular contacts and share improvement of roads along the China-Nepal border, and a
views on issues of mutual interests. China is the second water supply project.
largest trading partner of Nepal.
In October 2019 Chinese President Xi Jinping made a two-

day visit to Nepal, he was the first sitting Chinese leader to
visit the nation in more than two decades. Leaders from the
two countries signed 20 agreements to boost connectivity,
trade, economic assistance, and security relations.

Nepal
200
180
175
160 151
140
135 135
120 107
94 97
100
79 87
80
60
60
37
40
20
0
EODB(Overall Star ng a Dealing with Ge ng Registering Ge ng Credit Protec ng Paying Taxes Trading Enforcing Resolving
Ranking) Business Constructuion Electricity Property Minority across Contracts Insolvency
Permits Investors Borders
Source: World Bank
Outlook 2020
The year of 2020 may witness further increase of proximity Investment Act, and the Special Economic Zone Act will help
between Nepal and China. 2020 looks like a good year for ease restrictions on foreign investment and reduce
Nepal and India to strengthen their ties with the oil pipeline transaction costs. In addition, 13 Special Economic Zones are
coming into the picture. This shared interest could further being constructed in various parts of the country.
lead to a competition between China and India in the region.
GDP growth is projected to average 6.4 % over the medium These efforts will further support growth. Nepal remains
term. susceptible to earthquakes and floods. Due to climate
change, monsoon patterns are changing, and the region
Newly enacted laws including the Foreign Investment and needs to prepare for more weather extremes, severe
Technology Transfer Act, the Public-Private Partnership and drought, as well as more intense periods of rainfall in 2020.

INTERNAL
SECURITY
POLITICAL
STABILITY
ECONOMIC
STABILITY
NATURAL
DISASTERS
INFRASTRUCTURE
Sri Lanka
Environmental Risks
Sri Lanka is an island country in South Asia, located in the intervention programme which resulted in a 50% reduction
Indian Ocean, geographically separated from the Indian in spread of dengue. While the World Health Organization
subcontinent by the Gulf of Mannar and the Palk Strait. In has announced that Sri Lanka has eliminated measles
September 2019, 48,560 people from 12,109 families in 5 through consistent vaccination coverage, the risk of
districts have been affected by extreme weather - Galle, importation of the disease remains; as the country shares
Matara, Kaluthara, Colombo, and Gampaha. As a result of significant population movement with Philippines,
flooding, landslide warnings were issued for Kalutara, Galle, Indonesia, and Malaysia.
Kegalle, and Matara districts on 27 September.
Droughts continued to be another serious environmental
Post floods, Sri Lanka witnessed a remarkable increase in the concern in Sri Lanka throughout 2019. The districts that were
number of cases diagnosed positive for dengue. It was the worst affected throughout the year include Rathnapura,
observed to have spread across seven districts: Gampaha, Puttalam, Kurunegala, Vavuniya, Jaffna, Mannar, Killinochchi,
Kalutara, Galle, Matara, Ratnapura, Kegalle, and Colombo. A Mulaitivu, Matale, Kandy, Hambantota, Polonnaruwa, and
combination of public health authorities, police, and military Anuradhapura. Climate change is expected to increase the
personnel carried out an extensive public health frequency and impact of hydro-meteorological hazards.
Water Level in Different Provinces
Thawalama Baddegama Pitabeddara Urawa Panadugama Ratnapura
3 5 2 1 6 2.5
Ellagawa Millakanda Putupaula Dunamale
7.8 7.9 3 3.5
Flood water level (feet)

Source: Department of Irriga on

Sri Lanka
National Elections
The presidential elections in Sri Lanka were held on 16 In 2020, Beijing will try to increase its economic assistance to
November 2019. Gotabaya Rajapaksa of the Podujana Sri Lanka under the Belt-and-Road Initiative. However, there
Peramuna (People's Front) party, who scored 52.25% of total is a possibility that Sri Lanka will not increase bilateral
accepted votes, was the clear winner. Soon after the election relations with China after the Hambantota port project debt
results, Gotabaya Rajapaksa announced his brother, pitfall. But how China would react to Sri Lanka's close military
Mahinda Rajapaksa, as Prime Minister of Sri Lanka. The new ties with the US or how the new government would keep the
Cabinet of Ministers were sworn in on 22 November. balance between the two world powers is a major question.
Some of the major issues during this election have been the The future also sees a strong possibility of Sri Lanka wanting
Easter Sunday terrorist attacks which further rekindled anti- to strengthen ties with India. With India's Research &
Muslim sentiments that put national security in question Analysis Wing (RAW) having been of assistance to fight
both internally and externally; USD 69.98 billion debt (of terrorism in Sri Lanka, the matter of developing friendly
which USD 34.4 billion is foreign debt); the 2018 political relations with India remains crucial for the nation from the
crisis when President Maithripala Sirisena attempted to internal security perspective.
remove Prime Minister Ranil Wickremesinghe and replace
him with former President Mahinda Rajapaksa. Another major foreign policy test for the new government is
the March sessions of the United Nations Human Rights
Since Gotabaya played a major role in ending the 30-year Council, where Sri Lanka's armed forces have been accused
long civil war between Tamils and Sinhalese Buddhists, he of committing war crimes.
has been seen as an authoritarian leader who prioritizes
civilian security, but favouring the Sinhalese Buddhists. This With the worldʼs big powers wooing the new government,
has helped him earn strong support among the majority President Rajapaksa is in a strong position to extricate the
Sinhalese Buddhists in the nation who voted in his favour, country from this process either by challenging the UNHRC
whereas his victory has raised concerns among the minority to do what it can or by ceasing to be a member of the UNHRC
Tamil community who had voted against him. as Israel and the US have done.
The new government will look to convert the country's

geostrategic position into an economic advantage, without
compromising the nation's territorial integrity; trying to
balance the influence of China, India and the United States.
China is likely to increase its economic assistance to Sri Lanka
under its Belt-and-Road Initiative to protect its multibillion-
dollar investments and its strategic foothold.

Sri Lanka
Radicalisation and Extremism
After a peaceful decade since the war between majority
Sinhalese and ethnic Tamil separatists ended in 2009, Sri
Lanka witnessed a series of bombings in churches and hotels
on Easter Day – 21 April. The attacks took place in three cities
– Batticalao, Colombo, Dehiwala, and resulted in the death of
above 250 people. According to reports, police had received
an intelligence brief on 11 April flagging the possibility of a
terrorist attack by the same group but authorities did not
pursue the leads. Later, the Islamic State (IS) group claimed
responsibility for the Easter Sunday attacks across Sri Lanka.
During the 26-year Sri Lankan Civil War, the Muslim

Sri Lanka Easter
Day Attacks
Number of
Bombings 9
community was the target of discrimination, political KILLED INJURED
violence, massacres and ethnic cleansing by the rebel Tamil
Tigers and the government-backed Sinhalese nationalists. In 3 262 12 0 505 0
the process of tackling the civil war, the government Security Forces Civilians Militants
constantly failed to pay attention to improve the conditions
Source: South Asia Terrorism Portal
of internally displaced Muslim communities. This triggered
extremism and radicalisation among the Muslim population
of the country.
Chinese Influence on Sri Lanka
There remains scope for vulnerable minority elements being China is the largest lender to the island nation. Sri Lanka
manipulated by groups with ulterior motives in attempts to retains fondness for Chinese loans, rather than international
flare up situations concerning national security. Failure of the sovereign bonds, despite high rate of interest. Colomboʼs
government in addressing the grievances of affected accumulated foreign debt is estimated at USD 55 billion.
communities could increase the scope for proliferation of Between 2019 and 2023, Colombo has to garner USD 17
social violence. billion for foreign loans maturing and debt servicing. Its
lenders include the China Development Bank, the
The government expects tourism to decline 30 % in 2019- governments of Japan and India as well as multilateral
2020 as a result of the suicide bombings. The loss of revenue institutions like the World Bank and Asian Development
has been estimated at USD 1.5 billion. Bank. Indian and Japanese loans have a much lower interest
rate.

Sri Lanka
Economic Indicators for Sri Lanka
In the period between 2005 to 2015, China had become a 4.48 Sri Lanka GDP Growth (% year)
major player enabling infrastructure development projects
in Sri Lanka. Some of the major projects taken by Beijing are: 3.5
3.4
3.21
Ÿ Contract to build 40,000 houses in Jaffna district in the 2.6
Northern Province, which suffered extensive damage
during Sri Lankaʼs 26-year-long civil war.
Ÿ Negotiation to invest USD 30-40 million in Sri Lankaʼs
plantation industry in the Northern Province and the
rubber, tea, and coconut plantations of the central
highlands.
2016 2017 2018 2019 2020
Most of the investment projects fuelled by China in the
Source: Asian Development Bank
island have left Sri Lanka indebted at an amount of USD 8
billion (comprises 10% of total debt of Sri Lanka) - like the
deep-sea Hambantota port project, the Colombo Port City
Outlook 2020
complex, and the Mattala Rajapaksa International Airport. With national elections looming, Sri Lanka's near-term
Besides the existing debts, Sri Lanka is seeking a loan of political landscape depends on who wins the Presidency and
nearly USD 1 billion from China for energy and motorways. this could have further major implications on the inclinations
of the country towards its neighbouring countries with
On the other hand, India has assumed a huge role in regard to economic relations. The next general election is
reconstruction of the Northern Province. It has got involved due in September 2020. However, the president can dissolve
in providing rehabilitation assistance to small businesses, the Parliament in March 2020, when the Parliament will
setting up an industrial estate in Jaffna, and constructing complete four-and-a-half years of its term. Climate variability
hospitals, clinics, and water supply projects. India is and sea level rise could bring inclement weather conditions
constructing 50,000 houses at a cost of USD 270 million to the country such as heavy rainfall and floods over time.
across the war-ravaged Northern province. Besides, it has
also restored the Jaffna-Colombo railway link as well as The presidential elections in Sri Lanka fell on 16 November.
upgraded the Kankesanthurai harbor and the Palaly airfield. Sri Lanka's election commission declared Gotabaya
In 2019, India has decided to join hands with Japan and Sri Rajapaksa of the Podujana Peramuna (People's Front) party,
Lanka, to expand the port in Colombo as part of efforts to who scored 52.25% of total accepted votes, the winner of the
balance Chinese inroads into the neighbourhood. country's presidential election on 17 November. Following

Sri Lanka
the election results, Gotabaya Rajapaksa announced his
brother, Mahinda Rajapaksa, as Prime Minister of Sri Lanka.
0 50 100 150 200
EODB The major issues of concern during this election have been:
(Overall Ranking) 99
Easter Sunday attacks which further rekindled anti-Muslim
sentiments that put national security in question both
Starting a Business 85 internally and externally; USD 69.98 billion debt (of which
USD 34.4 billion is foreign debt); 2018 political crisis when
Dealing with President Maithripala Sirisena attempted to remove Prime
Construction Permits 66
Minister Ranil Wickremesinghe and replace him with former
President Mahinda Rajapaksa. These issues have that put the
overall economic performance in crosshairs that now poses
a major challenge to the new government.
Situated in the Indian Ocean, Sri Lanka is a key location for
Getting Credit 132 global shipping, drawing attention from both Beijing and
New Delhi. During the previous Rajapaksa regime, Sri Lanka
Protecting had strongly inclined towards ties with China as they had
made their economic and security policies China-centric.
Although, there might be a chance that the nation will not
Paying Taxes 142 have a bias towards relations with China after the pitfall into
its debt trap, the Hambantota port project.
Simultaneously, a possible reason why Sri Lanka might
strengthen ties with India could be that the Rajapaksas have
Enforcing Contracts 164 not gained support from the Tamil minority groups in the
country. This may influence their approach towards India to
Resolving Insolvency 94 resolve ethnic tensions within Sri Lanka. Also, India's
Research and Analysis Wing having been of assistance to
fight terrorism in Sri Lanka, the matter of developing friendly
relations with India remains crucial for the nation in the
security perspective.
Source: World Bank

INTERNAL
SECURITY
POLITICAL
STABILITY
ECONOMIC
STABILITY
NATURAL
DISASTERS
INFRASTRUCTURE
Area 300 mn sq km Population 0.44 mn GDP Growth Rate 8.83 % GDP 3.64 bn USD
The Maldives
Political Scenario Seats Won in 2019 Parliamentary Election
2019 marked a good year for Maldives as political stability Political Parties Seats
MDP
slowly returned to the island nation following the conclusion 65
Independent 7
of parliamentary elections without any major incidents to Jumhoree party 5
hamper the democratic process. The comeback of the PPM 5
country from a pro-Chinese approach during the rule of 87 PNC 3
erstwhile President Abdulla Yameen was marked with the Total seats MDA 2
elections that were held in September 2018, with current

MDA Independent Jumhoree party PPM MDP PNC
President Solih taking over the leadership. In the past year, Source: Mihaaru.com
the country has undergone rapid changes and multiple
reforms have been initiated as a result. Former President
Mohamed Nasheed also returned from exile and led his India – Maldives Relations
party Maldivian Democratic Party (MDP) to a landslide
The Maldives has long been subject to a proverbial tug of
victory with almost two thirds majority in the 87-member
geopolitical war between regional powers India and China.
assembly.
The Republic of Maldives lies in between the Gulf of Aden
and the Gulf of Hormuz with the Strait of Malacca. The nation
A visible divergence in foreign policies between both the
is crucially situated in the Indian ocean along the routes for
regimes is noticeable, with current President opting to
oil and world trade. During the rule of ex-President Yameen,
cement and strengthen ties with India over the looming
the country almost completely steered itself towards
influence that China has on the Maldives. While former
reliance on China which helped him maintain political and
President Abdulla Yameen had increased the country's
economic support. Investment aid from China, did help the
reliance on China after multiple borrowings that resulted in
archipelago fuel growth and development to a certain
the country going into a large debt. A change in the political
extent, however, concurrently raising the debt of the country
landscape in the country also averted the imposition of
to China. This was part of the Belt Road Initiative that
western led sanctions after the country faced rampant
Maldives agreed to be a part of, repercussions of the same
corruption before the elections.
resulted in the modifications of land laws, after which a
sizeable amount of land was acquired by China.
Political stability returned after years of turmoil and
instability which drew criticism and condemnation from the
With the election of President Solih, Maldives has reset its
West. President Solih has promised further reforms to end
relations with India, reinforcement of ties between the two
political influence over state institutions such as the police,
countries occurred in June 2019 and bilateral ties were
bureaucracy etc. Additionally, ex-President Yameen is being
renewed between India and Maldives, signing six
investigated for suspicion of money laundering and
agreements in key areas of defence and maritime. India has
corruption.

The Maldives
Climate Change
placed significant importance on its ties with Maldives which With over 1190 islands only 188 islands are inhabited in
reflects its Neighbourhood First Policy. Amongst the Maldives across 900 kilometers in the Indian Ocean,
numerous agreements inked between the two countries conferring it with strategic geopolitical advantage.
such as technical agreements on sharing of white shipping
information between the two countries. The However, the landscape of the Maldives as a whole remains
commencement of a ferry service between Kochi and susceptible to the detrimental effects that climate change
Maldives was also announced during the visit. brings. Rising sea levels pose a significant threat to small
island developing nations across the world which Maldives is
Furthermore, Maldives has also applied to rejoin the a part of.
Commonwealth in order to signal the international
community of its belief in values such as good governance, The country has set clear goals to tackle a range of issues by
democracy, gender equality and sustainable development. 2030 which will aim at reducing the effects of climate change
Isolationist policies undertaken by ex-President Yameen with traditional work around health and building of socially
have been rolled back in a bid to reshape the country's resilient communities.
foreign policy in alignment with international standards. The
visit from Maldives Parliamentary speaker Mohammed
Nasheed in New Delhi in September 2019 highlighted the Increase in Tourism
importance of Maldives-India relations.
4,82,978
4.20,047
6,00,000
Indian Aid to Maldives 5,00,000
3,59,053
4,00,000
3,00,000
2,00,000
1,00,000
2017 2018 2019

18.1 83.3 Source: Statistics & Research Section Ministry of Tourism Maldives
USD Million USD Million
2018-2019 2019-2020
Source: East Asia Forum

The Maldives
Ease of Doing Business Outlook 2020
With the return of political stability, the year 2020 poses to be
0 50 100 150 200 a promising one for Maldives both economically and
politically as multiple reforms and joint projects are
EODB
(Overall Ranking) 147 anticipated to be implemented.
Starting a Business 74 According to the World Bank, Maldives Gross Domestic

Product (GDP) growth is slated to increase in 2020 at 5.5%.
Dealing with Multiple construction projects are expected to increase in
Construction Permits 63 the year to come.
Getting Electricity 149 A slew of measures are expected to be implemented by

President Solih which aims at increasing the country's
tourism in 2020. India-Maldives ties are projected to solidify
with increased cooperation between the two countries.
Getting Credit 144
Protecting
Paying Taxes 119
Source: World Bank

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PAWAN DESAI ANUSHKA SINGH
BHUMISH KHUDKHUDIA
EDITORS HISHAM HAZARI
SUSHIL PRADHAN KAMAKSHI MAHAJAN
APARNA GUDDAD NIKITA KOHLI
ESHITA PAUL PARAS SHARMA
RUBAINA SANGHA ROSHANI VYAS
SHARON JOHN SANCHITA JAIN
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RISK REVIEW 2020

Religion: World's largest population of Hindus,

NE Military Power (Standing Army): India 1,362,500,

INDIA Population: 1.87 bn (25% of world's population).

Growth Rate: 5.9%

Area 5.1 Million sq km (11.51% of Asia)

MALDIVES Life Expectancy: 69

Risk Rating Internal Political Economic Natural

Vh VERY HIGH H HIGH M MEDIUM L LOW VL VERY LOW

South Asia Risk Review 2020 www.mitkatadvisory.com

Lt Gen Sudhir Sharma

South Asia Risk Review 2020 www.mitkatadvisory.com

INDIA AFGHANISTAN PAKISTAN SRI LANKA NEPAL BANGLADESH

2017 2018 2019 Source: Our World in Data

South Asia Risk Review 2020

South Asia Risk Review 2020

South Asia Risk Review 2020

South Asia Risk Review 2020

2020 may prove to be one of the more unstable years for

South Asia Risk Review 2020

South Asia Risk Review 2020

South Asia Risk Review 2020

The pattern of violence in such collapsed states does not

South Asia Risk Review 2020

It would be a few years, for the US troops to withdraw from

Afghanistan remains a fragile state. Democracy has not

South Asia Risk Review 2020

South Asia Risk Review 2020

South Asia Risk Review 2020

patriarchal society. In 2001, once the war was officially over,

and manhandling within Afghan homes will continue.

South Asia Risk Review 2020

Source: World Bank

South Asia Risk Review 2020

South Asia Risk Review 2020

40000 The Bangladeshi authorities regulate access to the areas

South Asia Risk Review 2020

changed the demographics of Bangladesh's Ukhia and Source- UNHCR

Teknaf areas. Reportedly, in these regions, Rohingya's now

Bangladesh authorities do not want the Rohingyas to 48%

62220 61626 169110 216816 14194 16011

Male Female Source- UNHCR

South Asia Risk Review 2020

Major Protests in Bangladesh in 2019

Source- MitKat Reports 2019

South Asia Risk Review 2020

South Asia Risk Review 2020

Flood Impact Level and Percentage of Population Affected

South Asia Risk Review 2020

Protecting Demands for wage increases are likely to drive industrial

Bangladesh's economy will continue to expand in 2020 fiscal

South Asia Risk Review 2020

South Asia Risk Review 2020

Indian Foreign Aid to South Asia, 2019

Nepal Afghanistan Maldives Bhutan Myanmar Sri Lanka Bangladesh

South Asia Risk Review 2020

Registering Property 53 In order to fund development, the creation of a stabilization

Economic Growth Forecast

2017 2018 2019 Forecast 2020 Forecast

South Asia Risk Review 2020

resulting in almost no investment in new projects by the World Bank 6

owners. Source - Respective Agencies