Klaus Voll - February Dossier - Feps-Europeare"impeachment"charges"against"the"Prime ......

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South Asia

: February

Dossier

This month

’s dossier

contains

detailed a

nalyses of

the polit

ical situat

ion in Tha

iland, Sou

th Korea,

and

between J

apan and

India. FEP

S Consulta

nt Klaus V

oll is acco

mpanied by

other exp

erienced a

nalysts to

look at th

e interactio

n of Indian

politicas w

ith these b

roader dy

namics in the r

egion.

Dr Klaus Julian Voll FEPS Advisor on Asia

with Dr. Joyce Lobo, Kasturi Moitra and C. Raja Mohan.

The ongoing political, economic and societal crisis threatens stability in Thailand. This dossier

contains extensive analyses of the visits of the South Korean President and Japan’s Prime Minister

to India, and highlights the geo-‐strategic importance of India’s “Look East Policy”. Kasturi Moitra

and Dr. Joyce Lobo analyze in a very detailed manner the multiple relations between South Korea

and India as well as India and Japan. In an wider context, C. Raja Mohan focuses on India’s role vis-‐

à-‐vis the Sino-‐Japanese rivalry, China’s “Maritime Silk Road” concept and India’s relations with the

Gulf states.

Conference Paper, Call to Europe, September 2013

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Table of contents

I. Political Instability in Thailand (Klaus Voll)

II. Vote South Korean President’s Visit to India: A Mutual Quest for Regional Liaisons (Kasturi

Moitra)

III. India-‐Japan Relations: New Allies or Strategic Partners? (Dr. Joyce S. Lobo and Kasturi

Moitra)

IV. Retooling for a new Asia (C. Raja Mohan)

V. Will India Join China’s Maritime Silk Road? (C. Raja Mohan)

VI. Bridging the Gulf (C. Raja Mohan)

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Political Instability in Thailand

By Dr. Klaus Julian Voll

There seems to be no solution to the deep political and societal crisis in Thailand, which is an

important member of ASEAN. Have democracy and parliamentary elections reached a dead

end?

Although Thailand went through elections on the second of February 2014, political instability and a

veritable stalemate between the government of care-‐taker Prime Minister Yingluck Shinawatra of

the Puea Thai Party (For Thais Party) and the opposition Democratic Party, led by Suthep

Thaugsuban, are continuing. Compared with the previous elections, the voter turn-‐out went down,

due to intimidation by the opposition and dissatisfaction with the government, also in its rural

stronholds.

Thailand -‐ Basic data:

Population about 67 millions

Overall GDP: US $ 365.56 billion

Per capita income: US $ 3351

Share in GDP (in 2012): Agriculture (8.4%), Industry (39.2%), Services (52.4%)

Background:

The North-‐South divide in Thailand refers to the ongoing political tension in the country owing to a

stand-‐off between Prime Minister Yingluck Shinawatra of the Puea Thai party, and protest leader

Suthep Thaugsuban from the main opposition Democratic Party. Shinawatra’s party won the last

election in 2011 in a landslide, with major support from the country’s north. The northern and

north-‐eastern parts of Thailand have in the past been a stronghold of her brother, former premier

Thaksin Shinawatra, who was ousted in 2007 by a military coup.

Thai government’s hardline "red-‐shirt" supporters in the country's north are gearing up to resist any

attempt by the military to stage a coup again, although this seems currently improbable. In 2010

there was a crackdown on the red-‐shirts in Bangkok by the "yellow-‐shirt" protesters opposed to

Yingluck. Some supporters say they also expect popularly elected Prime Minister Yingluck

Shinawatra to retreat to Chiang Mai and set up a government there, if the army tries to take power

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in Bangkok amid ongoing anti-‐government demonstrations. (“Red-‐shirts 'ready to resist' Thai army

coup, set up capital in Chiang Mai”, South China Morning Post, 29 January 2014)

Another snap election was called for on 2 February, but "yellow-‐shirt" protesters vowed to boycott

and disrupt it and eventually want to overthrow the government. The yellow-‐shirts draw their main

support from Bangkok's middle classes, the country's royalist elite and factions of the military.

This has racked the country with the north supporting the incumbent government and the south

dissatisfied with and opposed to Yingluck Shinawatra.

Unclear election results:

Before the election, so-‐called “advance voting” had been substantially disturbed. Finally, more than

20 million voters could cast their votes on the second of February 2014. Only 26.18% of Bangkok’s

voters exercised their vote, be it due to intimidation or free will. Altogether, a country-‐wide re-‐run in

69 constituencies for 8.75 million voters has to be organized in the near future.

Therefore, the results of the elections cannot be declared and no new Prime Minister can be

elected. Judicial probes are taking place about the legitimacy of the elections.

Perspectives:

Since 1933Thailand has seen 25 general elections and 12 military coups.

The former Prime Minister Thaksin Shinawatra, the elder brother of the current PM, formed in 1998

Thai Rak Thai (TRT), and led it in 2001 to victory. Vivek Katju, a former Indian Ambassador to

Thailand, observes: “He mobilised the poor rural communities of the country’s populous northeast

and northern regions through welfare measures, which included the grant of education loans,

microfinance for livelihoods and access to healthcare for the poor. Thaksin also became popular with

the new business classes by advocating policies that promised openings to them”. (Vivek Katju:

Cloudy in Bangkok. The Indian Express, February 7, 2014)

Since then, the Democratic Party, which represented the interests of the traditional Bangkok elite,

became the principal opposition party and did not win any elections.

The political scientist Dr. Prajak Kongkirati, an expert on political violence in Thailand, envisages a

state of paralysis and failed government with instability for quite some years to come. Kongkirati

holds responsible the ”People’s Democratic Reform Committee” (PDRC), which consists of members

of Bangkok’s middle class and people from the South, which together are in a political minority: ”We

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have a sizable group of people, hundreds of thousands of them, who are determined in their rejection

of the election. How can democracy continue under this condition? How will You live together in

peace?” (Bangkok Post, 1. 2. 2014)

There are impeachment charges against the Prime Minister and all kinds of cases. It seems, that the

opposition tries to drag out the process of certifying the elections as long as possible with the final

aim, to install a nominated care-‐taker government of “wise men.” But any undemocratic ouster

would enhance government support.

Meanwhile, Suthep Thaugsuban tries to establish relations with dissatisfied farmers, since many

have not received the promised compensations under the rice-‐pledging scheme of the government.

Thaugsuban argues, that the ouster of the government is “beyond our means”, indirectly appealing

to other forces to join hands.

Currently, a solution to this deep political and societal crisis seems to be nowhere in sight. Deep

contradictions lie at the heart of the tremendously complex Thai system. Investors have withdrawn

about $ five billions from equities and bonds during the last three months. There is quite a sizable

reduction in GDP growth. A lower influx of tourists affects the tourism industry, the major backbone

of the Thai economy.

Commentators fear, that further political instability will enable Thailand’s neighbours Vietnam and

even Myanmar to race ahead. Therefore they argue, it is essential to find a negotiated way out,

since neither side can plunge ahead on its own.

Vivek Katju argues: “The old elites still retain considerable power. They dominate a powerful judiciary

and the army, and have economic clout. Above all, the Democratic party has control of the vote in

the southern provinces, which enables them to control at least a quarter of the national vote. Like

Thaksin’s supporters, they have the capacity — which they have exercised — to use a mob to

incapacitate large sections of Bangkok, including government offices. The king is in retirement but

retains his aura, which he has earned through his personal conduct. So, the monarchy’s institutional

ability to influence the future is uncertain. The logic of democracy is on Thaksin’s side but it is

unacceptable to the old political classes. They hope that if Thaksin cannot return, the movement he

has helped generate will collapse. However, social forces are at play and the future is cloudy.” (Ibid)

Some analysts are even going so far to assume, that a split of Thailand can finally not be fully ruled

out.

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South Korean President’s Visit to India: A Mutual Quest for Regional Liaisons

By Kasturi Moitra

India and South Korea are increasingly looking to each other in their mutual quest for forging

meaningful friendships in the Asian region, as is evident from South Korean President, Park Geun-‐

hye's recent visit to India. However, though the relationship currently exhibits breadth, it is yet to

acquire depth.

Introduction:

The President of the Republic of Korea (ROK), Park Geun-‐hye was on an official visit to India from

15th -‐18thJanuary 2014. She was accompanied by her foreign minister, the minister for science and

technology, and the minister for trade and industry. The delegation met with Indian Prime Minister

Manmohan Singh, President Pranab Mukherjee, External Affairs minister Salman Khurshid, and the

minister for trade and commerce, Anand Sharma. In-‐depth views were exchanged on regional and

international issues apart from discussing ways to further bolster bilateral relations.

The very composition of the South Korean coterie as well as the Indian officials who received them,

reveals the sheer breadth of bilateral ties that the two countries have envisaged. Apart from the

political, defence and strategic dimensions, economic aspects formed a lynchpin of the Korean

President’s visit. Furthermore, the importance of scientific and cultural exchanges was also

repeatedly enunciated.

However, even though both countries are moving up considerably in each other’s foreign policy

priority list, India-‐South Korea relations need to acquire some depth, alongside the breadth of the

relationship.

Contextualizing India-‐ROK relations: Despite the establishment of diplomatic relations since 1973

and notwithstanding India’s “Look East Policy” of the mid-‐1990s, South Korea has not figured

predominantly in India’s foreign policy calculus and vice versa in the past. Robust economic relations

were the cementing factor of bilateral ties and it was much later that other facets to the bilateral

relationship were explored with the two countries signing the “Long Term Cooperative Partnership

for Peace and Prosperity” in 2004 and finally becoming “Strategic Partners” in 2010.

Dr. Srinath Raghavan remarked recently at a talk that India’s foreign policy seems to have shifted its

focus from West Asia to East Asia of late.[1] Dr. Sreeram Chaulia notes how even in East Asia, India

has traditionally concentrated more on Southeast Asian countries in matters both political and

economic. New Delhi’s relative neglect of the geographically more distant Northeast Asia is gradually

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being redressed as is evident from instances like the spectacular warming of ties between India and

South Korea, and India and Japan.[2]

During President Park Geun-‐hye’s January visit the two countries laid out a vision for the next forty

years of their bilateral relations. This included enhancing bilateral strategic communication channels

in the political and security field; consolidating the institutional framework for economic

cooperation and expansion of trade and investment; engendering cultural understanding through

people-‐to-‐people interactions; and closely cooperating with each other as partners at multilateral

fora on the regional and international stages.[3]

Outcomes of the visit: India and South Korea signed a gamut of agreements spanning a wide range

of areas including foreign affairs, defence, trade and investment, science & technology, and culture

and people-‐to-‐people exchanges.

Strategic and Defence:

India and South Korea agreed to cooperate in the field of defence and went on to sign an agreement

to ensure the protection of classified military information which might be exchanged in the process

of boosting their defence engagement. Both PM Singh and President Park pledged to work in

tandem with one another at various multilateral regional and global fora. Developments in the

Korean Peninsula and concerns over North Korea’s nuclear ambitions were also discussed. In years

to come, India and South Korea are likely to collaborate in the areas of maritime security particularly

in protecting the sea lines of communication in the Indian Ocean.

Though South Korea offered to trade defence equipment and nuclear technologies with India, it was

conveyed to President Park during her visit that this could possibly be taken up only when India

moves to the second phase of expanding the size of its nuclear plants.

Economic:

Bilateral trade in goods and services between India and South Korea crossed the US$20 billion mark

in 2011, largely stemming from the Comprehensive Economic Partnership Agreement (CEPA) that

they had signed in 2010. Thereafter, India and ROK decided to set a new trade target of $40 billion

by 2015. In terms of investments, South Korea has about US$ three billion worth invested in India,

while India has about one billion in Korea.

Discussions on further fortifying existing economic relations formed a major component of the South

Korean President’s visit. President Park interacted with minister for trade and commerce, Anand

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Sharma and representatives of Indian chambers of commerce at the Korea-‐India Economic

Cooperation Forum, the India-‐Korea IT Expo 2014[4], and the India-‐Korea Infrastructure

Development & Partnering Plaza 2014 Summit[5].

The two premiers also concluded the Double Taxation Avoidance Convention during which PM Singh

went on to invite more Korean investments into India, especially in the infrastructure sector. The

possibility of establishing a Korean Industrial Park in Rajasthan and setting up a CEOs Forum were

also discussed to engender a conducive investment climate and to strengthen overall economic

collaboration. The Indian PM further promised to review the upgrading of CEPA and to this end it

was agreed to convene a meeting of the trade ministers in the first half of 2014 in Seoul. The

proposal to establish a US$200 million Interbank Export Credit Line between the State Bank of India

and the Export-‐Import Bank of Korea was also lauded as helping bolster trade and investment.

Another important take-‐away from the recent visit by the South Korean President was the

reassurance by the Indian PM that the POSCO steel project, which has been mired in environmental

and land acquisition issues for over seven years now, would soon receive the necessary clearances

to become operational in the Indian state of Odisha.

Scientific and Cultural: Apart from this India and South Korea also concluded an agreement for

cooperating over peaceful uses of outer space and a MoU on reviving India’s Nalanda University. A

number of agreements were also signed pledging exchange of scientific know-‐how and cooperation

in information technologies and cyber security. The two countries also sought to enhance their

cultural and people-‐to-‐people links through a series of exchanges. In addition, India’s extension of

“tourist visa on arrival facility” to South Koreans was welcomed by President Park.[6]

Perspectives:

The Associated Chambers of Commerce and Industry of India (ASSOCHAM) identified “excessive red

tapism, poor infrastructure, complex tax policies, protectionist labour laws, high licensing and

inspection costs, congested judicial system and land acquisition problems” as major bottlenecks

driving South Korean investors to opt for other Asian countries.[7]

However, the Korean President while speaking to leading Indian industrialists remained sanguine

when she said that the environment clearance to POSCO will surely encourage other major Korean

“chaebols” (business houses) to invest in India: “When the Posco project in Odisha kicks off on full

scale, it would inspire other large conglomerates in Korea to channelise investible funds into

India”.[8]

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According to Indian foreign policy analyst, Harsh V Pant, linkages with the Indian economy can help

Korea grow at far higher rates than it is currently experiencing and dovetails perfectly with its

strategy for a “creative economy”.[9] Again, South Korea’s technologically advanced and cost-‐

effective military industrial complex could help India diversify its defense sources. India’s Defence

Minister, A.K. Antony has also described South Korea as an essential component of India’s vision of

the “emerging East Asian architecture.”

Strategic analyst C. Raja Mohan points out how the incumbent Congress government’s strategic

ambivalence and administrative dysfunction have prevented India from deepening economic and

security cooperation with key regional powers like South Korea and Japan without a reference to the

Asian territorial disputes. However, Kamal Davar holds the opposite view and argues that “the UPA

dispensation did succeed in fostering […] progress in its Look East policy” and cultivating “multi-‐

faceted and strategic ties with other economic powerhouses in Asia”.

Roadmap for the Future:

The geopolitical and geo-‐economic fabric of the current regional architecture of Asia is such that

each country in this region is scurrying to make the most qualitative and quantitative liaisons. India

and South Korea are not too different in a number of regards – to begin with both are democracies

as well as market economies; both have perceptible threats in their respective immediate

neighbourhoods; both are trying to woo global markets by diversifying their economies; both want a

say and stake in the so-‐called “pivot to Asia”, and neither wants to be left out of any consequential

political or economic regional arrangements (for instance the Trans-‐Pacific Partnership is currently

creating a stir and anxiety with regard to who all will be aboard). Somewhat similarly situated in the

current international system and in the imbroglio of Asian affairs, it is natural that India and South

Korea would gravitate towards each other.

President Park came to India bearing gifts that India appreciated (major investments, Nalanda

University, etc.) and India in turn did not send back the president empty-‐handed either (POSCO, visa

facilitation, etc). It is a good beginning in that both sides are being candid about what they expect

from and have to offer to each other as well as their respective concerns. For example, South Korea

made no attempt to express its disappointment over CEPA saying that its content did not match that

of other free trade agreements. Similarly, India clearly conveyed that it will be some time before it

can do nuclear commerce with South Korea. This candour augers splendidly for forging the basis of

strong and sustainable relations between India and South Korea in future.

The most important aspect of the reinvigorated ties between India and ROK is that they are not

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likely to majorly antagonize any of their neighbours in the region, at least not yet. As noted by

Sreeram Chaulia, unlike Japan, South Korea is not inclined towards overtly countering Chinese power

in the Asia Pacific.[10] Nor is India likely to take up a very vociferous stance against North Korea.

However, the future trajectory of India-‐ROK relations and its larger ramifications for the Asian region

as a whole will hinge deeply on how these two countries manage their engagement with each

other.

Notes:

[1] Talk by Prof Sunil Khilnani and Dr Srinath Raghavan on “Strategic and Foreign Policy Challenges for India” at Aspen Institute, New Delhi, 13 January 2014.

[2] Sreeram Chaulia, “South Korea Calling India”, The Diplomat, 18 January 2014, URL:http://thediplomat.com/2014/01/south-‐korea-‐calling-‐india/

[3] Ministry of External Affairs, India-‐ Republic of Korea Joint Statement for Expansion of the Strategic Partnership, 16 January 2014, Government of India, URL: http://www.mea.gov.in/in-‐focus-‐article.htm?22752/India+Republic+of+Korea+Joint+Statement+for+Expansion+of+the+Strategic+Partnership

[4] The Hindu Business Line, South Korea keen on working with Indian IT firms in other markets, 17 January 2014, URL: http://www.thehindubusinessline.com/industry-‐and-‐economy/info-‐tech/south-‐korea-‐keen-‐on-‐working-‐with-‐indian-‐it-‐firms-‐in-‐other-‐markets/article5586293.ece?ref=relatedNews

[5] The event is promoted by KOTRA (Korea Trade-‐Investment Promotion Agency Trade Office) of the Embassy of the Republic of Korea for the promotion of bilateral trade and investments.

[6] Ministry of External Affairs, List of Documents signed during the state visit of President of Republic of Korea to India (15-‐18 January 2014), 16 January 2014, URL:http://www.mea.gov .in/in-‐focus-‐article.htm?22750/List+of+Documents+signed+during+the+state+visit+of+President+of+Republic+of+Korea+to+India+1518+J

[7] Elizabeth Roche and Ragini Verma, “South Korea pitches for business-‐friendly environment in India”, Hindustan Times Livemint, 15 January 2014, URL:http://www.livemint.com/Politics/JXgD9mqLzgerLx8qQG6bUO/South-‐Korea-‐pitches-‐for-‐businessfriendly-‐environment-‐in-‐Ind.html

[8] A.K. Ramdas, “Park Geun-‐hye visit augurs well for India-‐South Korea Relations”,Moneylife Beta, 20 January 2014, URL: http://www.moneylife.in/article/park-‐geun-‐hye-‐visit-‐to-‐india-‐and-‐indo-‐south-‐korea-‐relations/36021.html

[9] Harsh V. Pant, “South Korean President Park Geun-‐hye's visit should boost India's Look East policy”, Daily News and Analysis, 16 January 2014, URL: http://www.dnaindia.com/analysis/column-‐south-‐korean-‐president-‐park-‐geun-‐hyes-‐visit-‐should-‐boost-‐indias-‐look-‐east-‐policy-‐1951601

[10] Sreeram Chaulia, n.2.

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India-‐Japan Relations: New Allies or Strategic Partners?

Dr. Joyce S. Lobo and Kasturi Moitra[i]

The current relations between India and Japan are being dubbed as a new alliance in the making

against China. However, both will remain strategic partners for the time being.

India and Japan have had good relations for over six decades. However, Japan’s recent tilt towards

India, especially since 2006, has been viewed from the angle of them becoming potential allies

against the Chinese might. This proximity was possible after India opened up its economy and

achieved high levels of economic growth while also signing the nuclear deal with the US. However,

India’s actions have moved in the direction of maintaining strategic independence while fostering

good relations with East and South-‐East Asian countries, including Japan. Amongst all these

countries, relations with Japan have been termed special and strategic.

Strategic Partnership

India-‐Japan relations are guided by the Strategic and Global Partnership. The Prime Minster of

Japan, Shinzo Abe, while on an official visit to India from 25th-‐27th January 2014 for the Annual

Summit, was also the Chief Guest at India’s Republic Day celebrations to celebrate six decades of

their friendship. These annual summits have been a regular feature (the other country with whom

India has annual summits is Russia) since 2006 when the ‘India-‐Japan Strategic and Global

Partnership' was signed between Abe and Indian PM Manmohan Singh. Apart from the regular

meetings and exchanges that India has with any other country, Japan is the only country with whom

it conducts 2+2 (at the Foreign Secretary and the Defence Secretary level) meets. Both have regional

dialogues on several parts of the world and one of those dialogues is on possible cooperation in

Africa. Both countries have a multifaceted relationship with engagements across a wide spectrum of

issues— political consultations, trade, cooperation in energy, science and technology, infrastructure

development, and defence cooperation and security cooperation including cyber security.

Abe visited India this January 2014 after the historic sojourn by the Japanese Emperor Akihito and

Empress Michiko in December 2013, followed by the visit of the Defence Minister

Itsunori Onodera. The visit by the Japanese Crown is an expression of long-‐lasting close ties and

friendship between the peoples of India and Japan. These two visits, prior to Abe’s were predicted as

leading to major breakthroughs in defence and nuclear cooperation. However, no groundbreaking

deal was signed. Memoranda of Understandings (MoUs) were signed between the two countries to

promote tourism, harmonize standards, and to enhance energy efficiency in Indian telecom towers.

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Two agreements were signed on Japanese loans for power generation in India and two

Japanese Overseas Development Assistance (ODAs) were advanced for financing a forest resource

management project in flood-‐devastated Uttarakhand and for improving an institute related to child

healthcare. During the January 2014 summit, both sides agreed to enhance coordination and

cooperation in ASEAN and East Asia Summit-‐related processes; to continue efforts for reform of the

United Nations Security Council within the G-‐4 framework; and to work for global growth and

prosperity through the Group of 20.

However, these visits not only seal the strong relations between both countries but also bear

testimony to the cordial ties that both enjoyed since India became independent while Japan

emerged from defeat, devastation, and isolation post-‐World War II. For instance, India under Nehru

pushed iron ore exports to help Japan build its steel industry in the 1950s when other countries

refused; Nehru declined to sign the Peace Treaty of San Francisco which Japan found as offending its

dignity and instead signed a separate treaty of peace with Japan in 1952 that waived all rights to

reparations, etc.[ii]

Defence and Security Cooperation:

Apart from economic cooperation being the main focal point of ties between the countries, defence

cooperation and importing arms from Japan has been one of the priorities of India in fostering good

relations. Japan and India have defence cooperation that is intended to become robust in years to

come. The two countries set up an institutional framework of defence cooperation in 2006, after

which the Defence Policy Dialogue, 2+2 dialogue, and the joint naval exercises which began in June

2012 became regular features in terms of defence and security cooperation. The second bilateral

training between the Japan Maritime Self Defense Force and the Indian Navy was held in December

19-‐22, 2013. Air exercises have also been agreed to during the visit of Japanese defence minister

Onodera to India recently. With Japan now having established a National Security Council (NSC), it

will hold consultations with the Indian NSC. Both countries cooperate in anti-‐piracy, maritime

security and counter-‐terrorism.

Both countries are aiming to take the defence cooperation to a higher level by exploring defence

sales and possibilities of arms production. Abe in his present tenure is attempting to amend the

Constitution to allow a greater role for defence industry. In 2011, Japan made changes to its 1967

rule of no international trade in defence equipment. Already the joint working groups (JWG) of both

countries are in working stages on the sale and co-‐production of US-‐2 amphibious aircraft used by

Japan’s Maritime Self-‐Defence Force (MSDF). Both countries are in broad agreement on the US-‐2

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amphibious aircraft deal wherein India plans to buy 15 planes priced at about $110 million

each.[iii] If the deal materializes India will be the first country to receive Japanese exports of defence

hardware.

Civil Nuclear Cooperation:

India is keen to conclude a civil nuclear deal with Japan the reason being that, “in the area of nuclear

technology there are certain advantages which rest with Japanese industry, in large-‐scale forgings

for example.”[iv] Japan is dallying on the civil nuclear agreement as it wants India to sign

the Comprehensive Test Ban Treaty (CTBT). India on the other hand feels its unilateral and voluntary

moratorium on nuclear explosive testing, and sound non-‐proliferation record suffices for soliciting

international cooperation in the area of civil nuclear energy programme and seeks Japan to partner

it. While Abe reiterated the importance of bringing into force CTBT at an early date in his recent visit

to India, both sides expressed their commitment to work together for the latter to become a full

member of the international export control regimes with the aim of strengthening international

non-‐proliferation efforts.

Japan has placed restrictions on enrichment and reprocessing in its nuclear energy agreements with

Vietnam, South Korea, Jordan, UAE and Russia. The 2011 Fukushima nuclear accident which gave

impetus to the non-‐proliferation lobby and public pressure to stall the process, hardened Japan’s

stance against nuclear weapons and reservations by the New Komeito Party (Abe’s coalition partner)

have hindered the signing of the agreement between India and Japan so far.

Focus on Economic Cooperation

The first economic interests that Japan cultivated in India were by dint of the Clinton administration.

However, over the years the two countries have taken off on their own to establish a meaningful

and mutually beneficial economic partnership, which has further flourished and taken deeper roots

against the backdrop of their increasing bonhomie in political, strategic and security affairs. Bearing

testimony to this is the signing of the Comprehensive Economic Partnership Agreement (CEPA) in

August 2011 as well as the first ministerial-‐level India-‐Japan Strategic Economic Dialogue held in

April 2012. Ever since, several channels of communication have been flagged off to encourage a

sustained interaction of businesses, commerce, trading and investment communities between the

two countries at both the inter-‐governmental as well as non-‐governmental levels.

Even during his recently concluded visit to India in January 2014, Japanese Prime Minister Shinzo

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Abe was accompanied by an economic mission headed by Hiromasa Yonekura, the Chairman of the

Japan Business Federation or Keidanren, along with a huge delegation of heads of Japanese

companies like Mitsubishi, Toshiba, Mitsui, Daiichi Sankyo, Hitachi and the East Japan Railway

Company. Significant discussions were held between the two heads of state as well as between the

ministries of trade and commerce of both countries. The agreements concluded spanned a range of

heads like trade ties, investment projects, overseas development assistance (ODA) through soft

loans and aid, and pledges for exchanging technological expertise in infrastructure, energy,

agriculture, medicine, education, and railways, ports and road development.

Investments and ODAs:

Japan is currently India’s fourth largest foreign investor with more than 1,000 Japanese firms having

established a business presence here, primarily in manufacturing.[v] Between April 2000 and

October 2013, India received a total of US$15 billion in foreign direct investment from Japan. Shinzo

Abe has been continuously encouraging Japanese business to give up their traditional risk-‐aversion

to India and make long-‐term commitments, especially given the complementarities in Abe’s focus on

ramping the Japanese economy and India’s need for capital and technology.[vi] The need to find

“overseas alternatives to Japan’s demand-‐constrained economy” as well as requirement for human

resources has found its way through direct investment into India, particularly in manufacturing

and “w[W]hen New Delhi proved unable to build the sort of infrastructure such investment would

require, Japan decided to help set up the necessary roads, railways and ports.”[vii]

Hence, one of the dimensions of Japan’s continued cooperation with India is in the area of being one

of the largest bilateral donors to the latter. Japan has been graciously extending Overseas

Development Assistance (ODA) through loans and grants with 66 projects currently underway in

India. This ODA has been extended from the time of Prime Minister Nobusuke Kishi (grandfather of

Abe Shinzo) who visited India in 1957 wherein India became the first country to accept the

assistance. So far the assistance given to India has reached 3,800 billion Yen ($ 36.7 billion).

Japan has both invested in and advanced large ODAs in laying world class infrastructure in India be it

the Delhi Metro, Western Dedicated Freight Corridor, Dedicated Freight Corridor Projects on Delhi-‐

Howrah routes, the Delhi-‐Mumbai Industrial Corridor, Indian Institute of Technology Hyderabad, and

the Chennai-‐Bengaluru Industrial Corridor. During PM Abe’s visit, India and Japan took stock of the

progress of these projects and also planned on how to take them to the next stage of

implementation through smart community working groups. Loan for theDelhi Metro Extension

Project has been extended during January 2014 summit to the tune of 200 billion yen in total.

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Japan also advanced a number of soft loans for power generation in India including that for the

National Thermal Power Corporation’s (NTPC’s) Kudgi and Auraiya Power Plant by the Japan Bank for

International Cooperation (JBIC).

Trade relations:

Though India has a reasonably robust bilateral trade with Japan, it is by and large the investment

aspects that have taken up primacy of place in their overall economic engagement. The last major

milestone on the trade front was the signing of the CEPA in 2011, following which bilateral trade

increased by 38 per cent in 2011–12. A target of US$24 billion was set for 2013 but was far from

being realized as trade figures in 2012-‐13 stood at US$18.51.[viii] Japan’s trade with India is only

about 1% of the former’s total trade, a point repeatedly brought up by the Indian minister for trade

and commerce, Anand Sharma as a case for removing all non-‐tariff barriers so as to allow the full

benefits of CEPA to follow. A move towards redressing this was taken by Japan when PM Abe

brought with him an offer to reduce non-‐tariff barriers on importing shrimps, a move that will help

Indian fishermen.

Other areas of economic cooperation:

India is eager for Japanese investments and technologies in manufacturing, electronics, agriculture,

railways, cyber security, medicine and energy. The Indian minister for trade, Anand Sharma

discussed with the Keidanren president the feasibility of setting up Electronic Manufacturing

Clusters (EMC) and Japanese Electronic Cities in India.[ix] Both sides pledged to continue efforts to

simplify visa procedures so as to give fillip to businesses in both countries

Moreover, both countries are in discussions to build infrastructure to enhance connectivity and

regional integration between India and its neighboring countries. During PM Abe’s recent visit, the

two leaders also considered a plan for an economic corridor linking South Asia with Southeast Asia

as a means to boost economic growth and Asian security.[x] The network is envisaged to have two

components – an East-‐West corridor linking India with Bangladesh, Myanmar and Thailand;

and a North-‐South corridor running through Bhutan and Nepal to south India.

In September 2013, Japan offered to extend its currency swap arrangement with India from US$15

billion to US$50 billion to help stall the rapidly declining Indian rupee. This was appreciated by the

Indian PM during the Shinzo Abe’s recent visit as a magnanimous gesture of helping India as well as

a manifestation of Japan’s desire to maintain a stable global and regional financial environment.

16

As far as overall economic cooperation is concerned, it is felt that trade relations between India and

Japan are still in a nascent stage with much untapped potential. However, Japan is sanguine that

once its technological transfers and investments in India’s infrastructure start reaping benefits, the

spillover effects will be felt in manufacturing which would then add a whole new dimension to India-‐

Japan economic dynamics. However, there is much ground to be covered in this regard as well.

Japan’s foreign direct investment into India is a fraction of what it has invested in China. Also, as

PM Manmohan Singh pointed out when he visited Japan last year, that India’s priority

was investments by Japanese business in infrastructure projects, rather than merely on loans and

official development assistance.

Indo-‐Japan Ties: Strategic independence prevails over strategic alliance

Tensions in the East China Sea mounted further after the Chinese imposed restrictions especially in

the form of Air Defence Identification Zone (ADIZ) over the area to bar passage of any kind, including

flights of any other country. India and Japan are wary of China’s ascendancy and assertiveness.

Japan under Abe Shinzo is keen to change its military posture moving away from its traditional policy

of pacifism. The 5% increase in defence spending, the new military strategy (that depends on

technology), the 2013 National Security Strategy, the creation of National Security Council, and

attempts to change the post-‐war constitution to give more powers to Japan’s defence forces, all

point in this direction. Abe has tried to win over his countrymen this time, unlike in 2007, due to

changed circumstances — a stagnating economy, China taking over Japan’s second position as the

world’s largest economy, Fukushima tragedy, and China’s assertiveness in the East China Sea.

India has so far refused to comment on the tense relations between Japan and China. However,

media and some of the scholars tend to term the robust and the recent flourishing of relations

between India and Japan to ‘rebalance’ China, a phrase used to express the recent close ties

between India and the USA. India believes in having strong relations with countries of East and

Southeast Asia as part of its Look East Policy. Moreover, Japan has disputes regarding

Senkaku/Diaoyu islands with China, Takeshima /Dokdo with South Korea and Northern Territories/

Kuriles with Russia. India refuses to take any sides so as not to affect its relations with these

countries and harm its national interest.

C. Raja Mohan, Indian foreign policy analyst, criticises the current UPA-‐led government in India for

its “strategic ambivalence and administrative dysfunction” and further adds, “Given India’s own

territorial disputes with China and Beijing’s support to Pakistan on Kashmir, Delhi, it would seem,

should be backing its friends in Tokyo, Hanoi and Manila. And where a dispute involves two of its

17

friends, for example, Japan and South Korea or Moscow and Tokyo, Delhi must encourage political

accommodation. The UPA government, however, seems paralysed at the very moment when many

Asian nations are looking up to India.”[xi] Though it is believed that China has issues with Japan over

the Senkaku/Diaoyu islands; and India over the Line of Actual Control (LAC), India won’t align with

Japan to contain China. India is looking towards Japan for securing its national interests and security

wherein it seeks not only defence hardware but is also exploring possibilities of joint production of

military technologies like it has sought from Russia and the US.

India refuses to be drawn into any kind of strategic alliance like the one proposed by Abe Shinzo in

2007 – a quadrilateral framework among Japan, India, the US and Australia based on shared values

and interests. India has refused to adopt a confrontationist approach or align with countries against

Pakistan or China. The UPA government in India, whose term is coming to an end in May 2014,

seems in a limbo to make any bold deal with any of the major countries or have clear cut stance on

issues related to the Southeast or East Asian region. Its political leaders are still influenced by

Nehruvian ideals without letting change in terms of the present Asian security order.

Conclusion

India, especially under the Manmohan Singh led-‐UPA government has often been criticized for not

forging alliances with countries like Japan and making the most of available opportunities to secure

its national interests in the quagmire of Asian affairs. However, it must be appreciated that India is

taking a longer-‐term, balanced view of its foreign relations rather than being swayed by the

immediacy and expediency of its neighbourhood and region. Both India and Japan are therefore at

present content to take one step at a time and not rush into each other’s arms. They have identified

areas of complementarities, a good example of which would be their mutually beneficial economic

relations which currently form a defining aspect of India-‐Japan cooperation.

India’s Joint Secretary of East Asia, Gautam Bambawale, listed the three priority areas for India in its

relations with Japan: “First of all we want Japanese technology; secondly we want Japanese capital,

investment into India; and thirdly we want Japanese modern management practices”.[xii] PM Abe

too in turn pointed out, “It is not that only India requires Japan — Japan also requires India”.[xiii]

India can offer Japan much-‐needed human resources as also a huge market for its demand-‐

constrained economy and as such perfectly dovetails with Abe’s plans of resuscitating the Japanese

economy through his “Abenomics”. There is a strategic dimension to this economic relationship as

well. If India succeeds in creating a conducive business environment and attracting foreign investors,

Japan may additionally find in it an alternative to China as an investment base (where it currently

18

has huge investments), especially given the ongoing Sino-‐Japanese acrimony in the East China Sea.

Apart from economic relations, the India-‐Japan relationship is also pregnant with potential

cooperation across a range of areas like defence, maritime security, civil nuclear energy, technology

transfers, cyber security etc. For the time being, however, relations between India and Japan can at

best be termed strategic, as an alliance or coalition of any form is far from India’s foreign policy

towards the Asian security order.

Notes:

[i] Dr. Joyce S. Lobo and Kasturi Moitra are independent foreign policy analysts.

[ii] Archis Mohan, “Prime Minister Shinzo Abe's visit: pinnacle of India-‐Japan relations”. January 22, 2014. URL: http://www.mea.gov.in/in-‐focus-‐article.htm?22762/Prime+Minister+Shinzo+Abes+visit+pinnacle+of+IndiaJapan+relations

[iii] Sanjeev Miglani, “India close to buying Japan-‐made military aircraft”. Reuters, 28 January 2014. URL: http://in.reuters.com/article/2014/01/28/india-‐japan-‐idINDEEA0R07S20140128

[iv] MEA: Transcript of Media Briefing by Official Spokesperson and Joint Secretary (East Asia), January 23, 2014. URL: http://mea.gov.in/media-‐briefings.htm?dtl/22769/Transcript+of+Media+Briefing+by+Official+Spokesperson+and+Joint+Secretary+East+Asia+January+23+2014

[v] Takeshi Yagi, “A power with responsibility”, The Indian Express, 16 January 2014, URL: http://m.indianexpress.com/story /1962305/hoped/oped/

[vi] Sanjaya Baru, “Singh and Abe, Act Two”, The Indian Express, 17 January 2014, URL: http://indianexpress.com/article/opinion/columns/singh-‐and-‐abe-‐act-‐two/

[vii] “Why India and Japan are becoming closer”. Special contribution from Hindustan Times, January 23, 2014. URL: http://asia.nikkei.com/magazine/20140123-‐Geared-‐for-‐success/Cover-‐Story/Why-‐India-‐and-‐Japan-‐are-‐becoming-‐closer-‐Subhead-‐The-‐two-‐countries-‐have-‐a-‐thing-‐for-‐each-‐other-‐each-‐wants-‐to-‐use-‐the-‐other-‐to-‐expand-‐its-‐economy-‐and-‐to-‐keep-‐a-‐check-‐on-‐China

[viii] The Hindu, “A strengthening relationship”, 29 January 2014, URL:http://www.thehindu.com/opinion/editorial/a-‐strengthening-‐relationship/article5627516.ece

[ix] The Economic Times, “India offers sops to Japan for investment in electronics sector”, 25 January 2014, URL: http://articles.economictimes.indiatimes.com/2014-‐01-‐25/news/46601388_1_greenfield-‐emcs-‐electronic-‐manufacturing-‐clusters-‐electronic-‐system-‐design

[x] IANS, “India, Japan to Discuss Economic Corridor, Security Partnership”, The New Indian Express, 25 January 2014, URL:http://www.newindianexpress.com/nation/India-‐Japan-‐to-‐Discuss-‐Economic-‐Corridor-‐Security-‐Partnership/2014/01/25/article2019639.ece

[xi] C. Raja Mohan, “Chinese Takeaway”. Opinion in The Indian Express, January 15, 2014.

[xii] MEA: Transcript of Media Briefing by Official Spokesperson and Joint Secretary (East Asia), January 23, 2014. URL: http://mea.gov.in/media-‐briefings.htm?dtl/22769/Transcript+of+Media+Briefing+by+Official+Spokesperson+and+Joint+Secretary+East+Asia+January+23+2014

[xiii] Hindustan Times, “Indo-‐Japan ties can do wonders: Japanese PM”, 25 January 2014, URL: http://www.hindustantimes.com/india-‐news/strong-‐indo-‐japan-‐ties-‐can-‐do-‐wonders-‐japanese-‐pm/article1-‐1176704.aspx

19

In the following three articles, C. Raja Mohan, India’s leading foreign and security analyst, focuses

on India’s positioning in the context of the China-‐Japan rivalry, the Chinese Maritime Silk Road

concept and India’s reaction as well as on the need for more consistent political engagement

between India and the Gulf countries as a supplement to their strong economic ties.

Retooling for a new Asia

By C. Raja Mohan

As Sino-‐Japanese rivalry spreads, Delhi must secure its interests.

The Indian Express: January 22, 2014

That India has little sense of geography and history was once again underlined by the scant national

attention paid to President Pranab Mukherjee’s visit last week to the Andaman and Nicobar Islands.

Mukherjee’s visit to the Andamans, as his trip to Arunachal Pradesh and Nagaland a few weeks ago,

was about alerting the Indian political classes about the geopolitical significance of its far-‐flung and

neglected territories.

Even if New Delhi does not get it, the rest of the world is reminding us of the importance of space

and time for the management of India’s national security. No one is going to do it more clearly than

Japanese Prime Minister Shinzo Abe, who arrives in Delhi this week as the chief guest at the Republic

Day celebrations. Abe’s visit, coming amidst mounting Sino-‐Japanese tensions, should help us reflect

on the intersection of the Sino-‐Japanese rivalry with India’s history and geography.

While the current uncertainty in Sino-‐US relations has generated considerable debate in Delhi, there

is a lot less appreciation of the consequences of the fast-‐deteriorating relations between China and

Japan. The military standoff between Beijing and Tokyo over the disputed islands in the East China

Sea — called the Daioyu in China and Senkaku in Japan — is only the most visible expression of a

deepening conflict between the world’s second-‐ and third-‐largest economies. It has raised big

questions about Asia’s contemporary history, the new nationalist passions in China and Japan, and

the future of the Asian security order.

For many in India, the arguments between Beijing and Tokyo over Beijing’s historic claims over

disputed maritime territories and Abe’s visit to the Yasukuni shrine that commemorates Japan’s war-‐

dead seem abstract and distant. But as in the past, so in the future, the nature of the relationship

between China and Japan is of enduring significance for India.

The rise of Japan at the turn of the 20th century and its victory over Russia in 1905 gave a big boost

20

to Indian nationalism by demonstrating that Asia can indeed prevail over Western powers. But

Japan’s occupation of China in the 1930s and World War II in Asia produced a diverse set of

responses from India. The Indian National Congress extended its solidarity to the people of China

against the Japanese occupation in the inter-‐war period. But the intensification of India’s own

struggle against British colonialism generated serious complications.

When Chinese nationalist leader Chiang Kai Shek came to India in 1942, asking Gandhi to

suspend the agitation against Britain and lend support to the Allies in the war against Japan, the

Mahatma was reluctant. Yet, the war saw the full mobilisation by the British of Indian military

manpower — 7,50,000 to be precise — to reverse Japanese aggression in Burma and Southeast Asia.

India also became the base from which America and Britain supported the Chinese war against

Japan. Even as Indian resources helped China fight imperial Japan, a section of the nationalist

movement, led by Subhas Chandra Bose, aligned with Tokyo to oust Britain from India. Another part

of the national movement, the Communist Party of India, extended full support to the British war

effort after the Soviet Union joined the Anglo-‐American alliance.

President Mukherjee’s recent visits to Nagaland and the Andamans captured India’s contradictory

responses to World War II. In Kohima, Mukherjee remembered the brave Indian and British soldiers

who decisively turned the tide against Japan’s advance into the subcontinent. In Port Blair,

Mukherjee celebrated the arrival of Bose and the Indian National Army in the Andamans and the

establishment of the Azad Hind government after the Japanese navy ousted the British from the

islands. The national movement’s ambivalent response to the shifting great power dynamic in the

run-‐up to World War II had a huge impact on the manner in which the subcontinent was partitioned.

It also severely weakened India’s position in the post-‐war order that emerged in Asia and the world.

A similar danger awaits India if it fails to correctly assess and respond effectively to the unfolding

Sino-‐Japanese rivalry in Asia.

Two broad principles outlined by Jawaharlal Nehru at the dawn of India’s independence must guide

Delhi’s current approach to the Asian power rivalry. One is to seek good relations with both China

and Japan; it is a proposition that Delhi has upheld despite great difficulties with both in the post-‐

war period. The other is Nehru’s insistence that post-‐war Japan should not be isolated or punished

because of its imperial past. In renouncing reparations and demanding that Japan not be treated as

an enemy state, Nehru understood that there could be no stability or security in Asia without Tokyo

getting its due as a great power. This is the unambiguous message that Delhi must put out during

Abe’s visit to India.

For nearly four decades, Japan and China have had closer relations with each other than with India.

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As they clash today, both attach considerable value to their relationship with India, which has the

potential to alter the larger Asian context. Rising China’s interest is essentially a negative one, to

keep the relationship with India tranquil as it confronts Japan in the east. Tokyo’s interest is positive,

as it seeks to build a strong strategic partnership with Delhi to balance an increasingly assertive

Beijing.

World War II — which brought the Sino-‐Japanese conflict to Delhi’s eastern frontiers in the

Northeast, Burma, the Andamans and Southeast Asia — severely tested incipient India’s strategic

coherence. Delhi needs to demonstrate a much better geopolitical aptitude in securing its interests

as Sino-‐Japanese rivalry engulfs Asia.

(The writer is a distinguished fellow at the Observer Research Foundation and a contributing editor

for ‘The Indian Express’.)

22

Will India Join China’s Maritime Silk Road?

By C. Raja Mohan

Like most great powers in the past and as one of the world’s greatest trading nations China wants

to be great maritime nation.

The Indian Express: February 15, 2014

India is apparently ready to join China’s grand ambition to construct a maritime silk road linking the

waters of the Pacific and Indian Oceans according to a Press Trust of India report from Beijing on

Friday evening.

Seriously! The outgoing UPA government might have a hard time selling the idea to the Indian

strategic establishment that has long been wary of Chinese navy’s rising naval profile in the Indian

Ocean and viewed with much suspicion Chinese construction of port infrastructure in Pakistan

(Gwadar) and Sri Lanka (Hambantota).

The PTI report cited Chinese officials to say that Beijing extended the offer to India in the just

concluded round of talks in Delhi between the Special Representatives of the two countries, India’s

National Security Adviser Shivshankar Menon and the Chinese State Councillor.

Although there has been no word yet from the Indian side, the idea of a ‘maritime silk road’ has

been right up the Chinese President Xi Jinping’s foreign and security policy agenda. Like most great

powers in the past and as one of the world’s greatest trading nations China wants to be great

maritime nation.

Xi’s predecessor, Hu Jintao put the idea of Beijing’s ‘maritime destiny’ at the centre of Chinese grand

strategy in the 21st century and oversaw the dramatic expansion of the PLA Navy. Hu’s naval

assertion, however, frightened Beijing’s neighbours, from Japan to India through the Association of

South East Asian Nations and increased maritime tensions in Asia’s waters.

Xi is now trying to promote a broader framework to make China’s naval rise less threatening. Central

to Xi’s strategy has been extension of the “Silk Road” concept that has largely been discussed in

relation to China’s policy towards Central and Inner Asian regions to the maritime domain.

During a visit to South East Asia last October, Xi articulated the concept of the ‘maritime silk road’

and insisted that the region could gain from expanded maritime cooperation with China. In January

this year, Xi proposed the maritime Silk Road project to a senior delegation from the countries of the

Gulf Cooperation Council.

This week, the idea came up in the discussions between the Sri Lankan foreign minister G.M Peiris

23

and his Chinese counterpart Wang Yi in Beijing. According to report issued by the official Xinhua

agency, Sri Lanka response was enthusiastic. Beijing and Colombo now hope to build their maritime

cooperation in a variety of areas ranging from connectivity to fisheries and environmental

protection.

From the Chinese perspective, it was smart move to invite India to join the maritime Silk Road

project. But Delhi is likely to be torn between two competing ideas—one is working together with

China in the maritime domain and the other is the long-‐standing goal of limiting Beijing’s influence in

the Indian Ocean. If the onus of rejection is on India, the last word on this is unlikely to come from

the UPA government.

24

Bridging the Gulf

By C. Raja Mohan

The stage is set for a more vigorous engagement with the region.

The Indian Express: February 24, 2014

Back-‐to-‐back visits to Delhi this week by the crown prince of Saudi Arabia, Salman bin Abdulaziz Al

Saud, and the foreign minister of Iran, Mohammad Javad Zarif, underline Delhi’s growing

engagement with the Gulf region, which has become vital for India’s economic, political and security

interests. The UPA government has often talked about a “look west” policy. Although Delhi is some

distance from organising a coherent look west policy, over the last decade, the UPA government has

set the stage for a more vigorous engagement with the Gulf.

Any suggestion of a look west policy compels a comparison with India’s much-‐celebrated Look East

policy and presents us with a paradox. India’s relationship with the Gulf is much denser than with

Southeast Asia. Yet the Gulf does not resonate as much as Southeast Asia in India’s foreign policy

discourse. India’s annual trade with the Association of Southeast Asian Nations (ASEAN), for

example, is expected to reach $100 billion by 2015. India’s trade with the six countries of the Gulf

Cooperation Council (GCC) — Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and Yemen — is expected

to cross $200 billion by then.

In pursuing an effective look west policy, the next government will have to take into account a

number of factors. For one, it must recognise that the GCC is a weaker regional institution than the

ASEAN and makes far fewer diplomatic demands on its partner countries. The membership of the

GCC does not encompass two key regional states — Iraq and Iran. Amid a deepening regional divide,

it is politically more volatile. This means it is up to Delhi to take the initiative on intensifying the

engagement with the region.

Second, as the principal source of India’s hydrocarbon imports, the Gulf will remain critical for

India’s economic well-‐being for the foreseeable future. While Delhi has talked the talk on energy

security, there is much the next government will have to do in translating it into more secure

interdependence. Third, the region is also a source of livelihood for nearly seven million Indian

expatriate workers and their families. It is also a major source of currency remittances, estimated at

more than $30 billion a year.

Securing the welfare of this large pool of manpower in the Gulf must be central to any look west

policy.

Fourth, the next government in Delhi must find ways to attract the large amount of capital available

25

in the Gulf for investment in India. If FDI is going to be critical in strengthening India’s

macroeconomic stability, the Gulf remains one of the most underutilised sources. Any improvement

in India’s investment climate would automatically boost the engagement with the Gulf.

Fifth, India must learn to overcome its Pakistan obsession while engaging with the region. Most

countries in the Gulf will continue to shower affection on Pakistan. This in no way limits the region’s

interest in a strong partnership with India. The growing gap in the national weights of India and

Pakistan has already encouraged the region to pursue separate policies towards the two countries.

In building deep linkages with the region over the coming years, Delhi could look towards a potential

moderating influence of the Gulf on Pakistan.

Sixth, the next government in Delhi will have to consolidate strategic partnerships with key countries

of the region. The last decade has seen the first steps towards greater cooperation on law

enforcement, intelligence sharing and counter terrorism, which offer huge potential to deepen

security cooperation between India and the Gulf. Seventh, there is a growing desire in the region for

defence cooperation with India. Few in the GCC expect India to replace the traditional sources of

external military support for the region. Yet, amid significant shifts in the global and regional balance

of power, the Gulf wants to diversify its military partnerships to include emerging powers like India.

Delhi has had a long-‐standing defence partnership with Oman and a more recent one with Qatar. In

the talks with King Hamad bin Isa al Khalifa of Bahrain in Delhi last week, defence cooperation

figured prominently. India is expected to sign an agreement on military cooperation with Saudi

Arabia this week. The next government in Delhi will have an opportunity to end some of the UPA

government’s dithering on defence diplomacy with the Gulf.

Eighth, Delhi needs to demonstrate greater political warmth towards the region. Over the decades,

Indian foreign policy has tended to treat the Gulf as some kind of a diplomatic ghetto, of interest

only to a few sections of Indian society. Despite the physical proximity and huge stakes in the region,

high-‐level visits by Indian political leaders have been few and far between. The time has come for

India to invest significant political, diplomatic and intellectual resources in understanding and

engaging with the region. Finally, with India seemingly set for a regime change after the next

elections, a government led by the BJP’s Narendra Modi might have some extra work to do in the

Gulf, given some of the controversies surrounding him.

Any incoming BJP government could easily reclaim the foreign policy legacy of Atal Bihari Vajpayee,

who cleared much ground for the construction of special relationships in the Gulf, successfully won

the region’s neutrality during the Kargil war with Pakistan, initiated a strategic dialogue with the GCC

and explored a political opening with the Organisation of Islamic Cooperation that Delhi had long

26

viewed with wariness. Vajpayee had demonstrated that the BJP government was a pragmatic and

productive partner to the Gulf nations. If he becomes prime minister, Modi’s reiteration of that

message would reassure the Gulf of continuity in India’s foreign policy. A special emphasis on the

centrality of the Gulf for India in the BJP’s foreign policy platform would help the party build on the

regional gains from the decade-‐long tenure of the UPA government if it comes to power.

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