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PacNet #66 – Abe’s India visit: cementing bilateral ties and defining the Indo-Pacific order

Barely three weeks after India and China agreed to disengage from the Doklam region, (the site of 10-week border standoff), Japanese Prime Minister Abe Shinzo arrived in India for the 12th Indo-Japan Summit, a clear signal of the dynamism behind Asian balance of power politics. In addition to the China factor, Abe’s two-day visit has been interpreted as an aggressive projection of India’s Act East policy, wherein the issues of strategic partnership, geopolitics, and  technological cooperation will be outlined with a goal to chart a shared vision of Asian order driven by the foundational desire to challenge Chinese might. With time, India-Japan ties have crossed “mere” bilateralism and appear to be moving toward creation of a niche in global order, as both attempt to influence the Indo-Pacific theater.

India refused to endorse or attend the Belt and Road Forum in Beijing in May, not just because of its opposition to the China Pakistan Economic Corridor passing through Indian-claimed territory but also because New Delhi views China’s growing economic footprint in Asia as a blatant attempt to create Asia-wide patron-client relations and it sees Japan as a natural partner to devise a strategy to counter the OBOR.

The response has come in the form of deepening strategic ties between India and Japan as well as announcement of the Asia Africa Growth Corridor (AAGC), which emerged in the joint declaration issued by Prime Ministers Modi and Abe, when Modi visited Japan in November 2016. The AAGC vision document was released in India (in collaboration with three think tanks linked to the governments of India, ASEAN, and Japan) only a few days after the conclusion of the BRICK summit. Inclusiveness and a decentralized approach are the key pillars of AAGC.

Japan’s growing role in India’s economy is also aimed at making India a lynchpin of the Asian geo-economic order, which can challenge China on multiple fronts. First, the pooled resources of India and Japan could become an alternative to China-funded projects in Asia and Africa. While no country can match China’s massive $3 trillion of foreign exchange reserves, an effective counter is possible only if India and Japan (and ASEAN) forge a partnership.

Second, Chinese projects have been controversial due to high interest rates, debt traps, and the possibility of conversion of debts into equity if the host nation is unable to repay it. When AAGC was announced, the Indian foreign office as well as the leaders repeatedly questioned the sustainability of the Chinese model, simultaneously projecting AAGC as a development model devoid of conditionalities for developing nations seeking large-scale investments. The case of Sri Lanka’s Hambantota project, in which a Chinese firm bought a 70 percent stake, has raised suspicions that China’s imperial motives are wrapped in the garb of infrastructure projects.

Japan’s assistance for the Indian Bullet Train project (Mumbai-Ahmedabad High Speed Rail) must be viewed in this context. Around 85 percent of the total project cost of $17 billion will be provided by Tokyo in the form of soft loans, with repayment stretching over 50 years, with only a 0.1% interest rate. The message being conveyed is that Indo-Japan collaborative ventures are more sustainable and better suited to address developing nations’ requirements, and that these nations must look beyond China for quality and cost-effective infrastructure. 

The last and the most important point pertains to the commitment to an Indo-Pacific order led by Japan and India, with US support. “Both India and Japan place importance on the universal values and strategic interests that we commonly share. Both countries are major Asian democracies and global powers. …and I’m determined that Japan and India will lead the way towards peace and prosperity in the Indo-Pacific region and the world,” Abe said in India. Though the term seems innocuous, “universal values” targets China’s adventurism in the South China Sea. One can also draw parallels with how US naval patrols challenge Beijing in South China Sea in the name of “Freedom of Navigation.” Thus, while China’s rising profile is respected, Chinese adventurism will continue to be challenged. (The quest to defend the Indo-Pacific order was once again reiterated in the recent trilateral meeting between the American Secretary of State, and Indian and Japanese foreign ministers, held on the sidelines of UN General Assembly in New York.)

North Korea also prompted Japan to seek strategic partners in the region. Reckless nuclear testing by Pyongyang and missile tests that flew over Hokkaido have alarmed Tokyo. Kawai Katsuyuki, foreign policy advisor to Abe, was in India a week before his visit, and expressed Tokyo’s concerns on the dual threat from an expansionist China and from spiraling tensions in the Korean Peninsula.  Kawai’s statement in New Delhi that the “Japanese Self Defense Forces may consider acquiring ballistic missiles and cruise missiles to deal with the threat” could hint that stronger defense cooperation could be on the anvil, though the possibility is weak at present. 

Although there is nothing new about the high regard the two nations have for each other, Abe’s visit is highly significant: it sets the stage for both countries to work aggressively toward a new geo-economic order.

Prateek Joshi ([email protected]) is a researcher on Asia’s geostrategic issues.

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