The New Year looks decidedly gloomy in India's political neighbourhood

The New Year looks decidedly gloomy in India’s political neighbourhood. Three key countries with which India has economic ties — Sri Lanka, Bangladesh and Nepal — are facing risks that appear to be worsening. Political headwinds have intensified in Dhaka; Kathmandu has finally got a government almost two months after general elections but Sri Lanka’s crisis continues.

Pakistan has intensified its problems, having its sovereign rating reduced to CCC-plus last week by Standard & Poor’s, which puts it deep in junk grade. But leaving Islamabad aside for the moment, locked as it remains in a politico-religious struggle, the travails of