Four Stories to Follow in South Asia in 2025

Welcome to Foreign Policy’s South Asia Brief, and happy New Year.

There will be many questions about South Asia and the world this year: how the region adjusts to a second Trump administration in Washington, how it is affected by conflict in the Middle East and Ukraine, and how it navigates unrelenting great-power competition.

But South Asia—faced with new governments, deepening instability, fraught borders, and economic struggles—will have its hands full closer to home. Below, we lay out four key storylines to watch in 2025.

India’s Relations With Its Rivals

India-Pakistan relations have been relatively calm since February 2021, when the two countries reached a truce to end cross-border violence along their disputed frontier bisecting Kashmir. But in 2024, a surge in terrorist attacks in Indian-administered Kashmir—violence that New Delhi tends to blame on Islamabad—and reported cases of cross-border firing generated concerns about fresh tensions.

Consequently, India-Pakistan ties—ironically, one of the region’s more stable relationships over the past three years—could be put to the test in 2025.

Meanwhile, India’s ties with China are taking an inverse trajectory. Relations between the two countries had been tense since a deadly 2020 clash along their disputed border, but last year brought a new deal that may create diplomatic space for more cooperation in the year ahead, likely in the commercial sphere.

With India grappling with numerous neighborhood challenges in 2025—from China’s latest inroads in Nepal to serious tensions with Bangladesh—it will have a strong interest in keeping relations calm with both rivals.

Regional Impacts of Myanmar’s Civil War

Myanmar’s civil war intensified in 2024, and the year ended with the Arakan Army rebel group holding territory in areas bordering India’s volatile northeast and the 170-mile frontier with Bangladesh. The Arakan Army’s leadership claims that it has no plans to declare independence in territory that it controls, but Myanmar experts say that possibility still can’t be ruled out.

Indian and Bangladeshi officials would likely view such a move with alarm. New offensives by Myanmar’s military could also generate fresh spillover violence in northeastern India, which is already grappling with unrest in the state of Manipur, and in Bangladesh, which is dealing with security challenges in the wake of Prime Minister Sheikh Hasina’s forced resignation in August.

How India and Bangladesh work to minimize potentially destabilizing impacts from Myanmar’s war will be a key regional security question in 2025. Ongoing India-Bangladesh tensions will complicate any attempts by leaders to try to tackle the challenge together.

A Sri Lankan Exception?

For a good news story in 2025, look no further than Sri Lanka. President Anura Kumara Dissanayake, who took office in September, will look to buck the regional trend of mass movements for change that fail to consolidate democracy.

Bangladesh has struggled to restore democracy following last summer’s so-called Gen Z revolution. But in Sri Lanka, Dissanayake came to power in an election viewed by observers as free and fair, following mass protests in 2022 that prompted strongman Gotabaya Rajapaksa to step down and ushered in a brief period of rule by his ally Ranil Wickremesinghe.

Dissanayake vows to strengthen democracy and weaken corruption, and he has rejected the violent Marxist politics of his party’s past. Whether he succeeds (and he has his share of strong skeptics) will be another key question this year.

If Dissanayake perseveres, it will be welcome news in a region with multiple messes to manage in 2025.

India’s Economic Path

India recovered well from the COVID-19 pandemic and has enjoyed impressive economic growth in recent years. It is the world’s fastest-growing major economy and is poised to become the fourth-largest economy overall in 2025.

But in 2024, long-standing obstacles—inflation, unemployment, and low private consumption rates—remained persistent, and GDP growth during the July-September quarter fell to 5.4 percent, a seven-quarter low that was well below many growth projections.

Indian officials insisted that the setback is temporary, arguing that reduced government spending during the 2024 national election campaign was a factor and that the economy will rebound. Still, New Delhi enters 2025 with some of its most pronounced economic challenges in years. How it tackles them will have major stakes for India—and for a global economy that counts on its contributions.