India is weighing a range of diplomatic option against Malaysia, including on the trade front. Background of the decision to retaliate:

  • The above movie is to convey India’s retaliation to send a stern message to Kuala Lumpur over Kasmir's remarks.
  • Over President Mahathir bin Mohamad’s tirade against India’s Kashmir policy at the UN General Assembly last month.
  • India is also concerned about the Zakir Naik extradition issue on which India feels   Malaysia has not done enough.

What range of diplomatic options India can exercise against Malaysia?

  • As the world’s largest palmolein importer, India can shift its Palmolein import from Malaysia to Indonesia.
  • India's retaliatory measures will include levying higher import taxes on Malaysian Imports.

The implication of India’s diplomatic options:

  • India’s move would hurt Malaysian farmers who have changed their regular cropping patterns to cater to the Indian market.
  • Indian traders have already reduced the imports of Malaysian palmolein.

About India – Malaysia Economic ties:

  • India’s FTA with ASEAN and the Comprehensive Economic Cooperation Agreement has worked in Malaysia’s favor.
  • Indian imports from Malaysia in 2018-19 were $10.81 billion, which is $4billion more than Indian exports.

Why India seems disappointed with Malaysia’s tirade against India’s Kashmir move?

  • India has gone the extra mile to deepen its ties with Malaysia.
  • Former Prime Minister Manmohan Singh signed a strategic partnership with Malaysia in 2010.
  • PM Narendra Modi converted into an ‘Enhanced Strategic Partnership’ in 2015.
  • To ensure the continuity, Modi also took a detour to drop by in Malaysia on May 31.

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