Thu Sep 27, 9:34 AM ET

NEW DELHI - India is walking a diplomatic tightrope, juggling energy and strategic concerns with a commitment to democracy as military-ruled neighbour Myanmar cracks down on pro-democracy protesters, analysts say.

But New Delhi's "nuanced approach" towards Myanmar is not an exception, said former foreign secretary S. Shashank, pointing to a decades' old policy of "doing business with (military) governments in Pakistan and Bangladesh."

India, which rolled out the red carpet for military strongman Than Shwe in a 2004 visit, was till the mid-1990s a staunch supporter of pro-democracy icon Aung San Suu Kyi.

It bestowed on Aung San Suu Kyi the prestigious Jawaharlal Nehru Award -- named after India's first prime minister -- in 1993.

But New Delhi, which kept the military junta at arms length after the 1988 crackdown on democracy protests, then changed track realising its security interests in the northeastern region were in jeopardy, said former ambassador to Myanmar, G. Parthasarthy.

"Insurgents from India's northeast were taking shelter there (in Myanmar). There was an intensification of attacks on Indian targets. Drugs were also flowing into India from Myanmar," he told AFP.

But since India began engaging with the generals, "there has been cooperation between Indian and Myanmarese security forces with some joint efforts to flush out the rebels," the ex-envoy noted.

"There are instances of Myanmarese soldiers being killed fighting Indian insurgents in the jungles there. Our policy of engagement has been paying dividends."

A government official, who asked not to be named, said India was also looking at Myanmar to provide an alternative access route to the under-developed, landlocked northeast.

"We have been requesting Bangladesh for transit facilities to reach the northeast which has not been forthcoming. Transit facilities would help the region develop economically and Myanmar has responded positively," he said.

Myanmar's large reserves of natural gas have proved another major reason for India to stay engaged.

Energy-hungry India and China, besides other Asian countries, have been jockeying for a share of Myanmar's vast energy resources -- triggering accusations that this was weakening US and European economic sanctions.

But Shashank noted that "economic sanctions in place for decades have not worked. It's only through engagement that you can exercise some kind of leverage. If you isolate someone, what influence have you got there?"

India's policies were no different from those of the influential economic grouping the Association of Southeast Asian Nations, which enrolled Myanmar as a member in 1997, the former foreign secretary said.

"If you look at the investment made by India in Myanmar, India must be at number 50 or 60 in a list which is headed by European companies," he added.

For retired army general Ashok Mehta India's response on Wednesday to the crackdown on pro-democracy activists was carefully crafted and deliberately low-key.

The foreign ministry issued a statement calling for "a broad-based process of national reconciliation and political reform" in Myanmar. Mehta said that allows India the flexibility to "not dump the junta" but "express its displeasure."

"Those accusing India of fostering close links with Myanmar and weakening sanctions are continents away, without the security concerns that India has.

"When the US talks of curbing terrorism, it does not look at who is in power. Take the case of Pakistan. The US has been talking to Pakistan and President (Pervez) Musharraf about democracy in whispers," Mehta said.

A western diplomatic source summed up the situation saying, "India is caught on one side between the defence of democratic values and its ambitions of becoming a superpower and on the other between protecting its national interests such as energy needs which puts pressure on its diplomacy."