(Un)realized Potential in the Indo-Pacific: The Abe-Modi Summit

Indian Prime Minister Narendra Modi met with his Japanese counterpart, Prime Minister Shinzo Abe on October 28-29 for the annual India-Japan bilateral summit. That the India-Japan relationship has expanded significantly over the years is well recognized, and this summit saw the continuing convergence of India’s “Act East” policy with Japan’s “Free and Open Indo-Pacific Strategy”. However, as the partnership progresses, aspirations for deeper growth in ties will have to overcome two kinds of obstacles. The first would necessitate this partnership to address the limitations that continue to exist. The second, would require it to take stock of what it should be cognizant of, if it is to successfully navigate through the rapidly changing dynamics in the Indo-Pacific. This is especially important in light of developments with regard to China and the United States.

In studying the India-Japan Vision Statement noticeable progress has made in important areas such as space, health, terrorism and the denuclearization of the Korean Peninsula. However, though persisting challenges remain, the following stand out significantly:

defense relations:

Defense cooperation between the two countries saw a thaw in relations. In a positive move, a formal negotiation process has started regarding a bilateral Acquisition and Cross-Servicing Agreement (ACSA) between India and Japan. The ACSA deal, which is comparable to the Logistics Exchange Memorandum of Agreement (LEMOA) that India signed in 2016 with the United States would be a key component in boosting India and Japan’s defense ties. For its part, Japan has only concluded a similar agreement with the United States, Australia, United Kingdom, Canada, and France. ACSA would allow Indian armed forces to access Japan’s base in Djibouti and Japan’s Self Defense Force (SDF) access to India’s strategically located Andaman naval base in the Indian Ocean. While geographical distance has been a limiting factor for both states to respond in times of crisis and conflict, ACSA could effectively address some part of this issue.

Maritime cooperation, which forms an important component of security ties between both countries, was further boosted, as an agreement between the Indian Navy and Japan’s Maritime Self-Defense Force was signed with regard to maritime domain awareness (MDA). Additionally, the summit saw both leaders welcome the initiation for laying the submarine optical fiber cables between Chennai and the Andaman Islands. The leaders further agreed to collaborate in the development of submarine cable projects. With the likeliness that this network would be integrated with the existing U.S.-Japan “Fish Hook” SOSUS network meant specifically to monitor People’s Liberation Army-Navy (PLAN) submarine activity in the South China Sea and the Indian Ocean Rim, this is a big move by both sides.

Further, in a list of many firsts for this summit, both leaders elevated the current Foreign and Defense Dialogue (2+2) to the ministerial level. It has also been announced that in November, both states are set to hold their first bilateral ground force exercises in Mizoram, India; and Japan will also be an observer at the India-U.S. Cope India air force exercises in December. These are welcome decisions that complement their expanding their security ties, which till now have mainly been focused on coast guard and naval exercises. Finally, the defense equipment and technology cooperation the agreement on joint research activities with regard to Unmanned Ground Vehicle (UGV) and Robotics has marked the first joint military cooperative research between India and Japan.

However, a setback once again is the inability of both countries to break through on the sale of Japan’s US 2 amphibian aircraft to India. This plane, in spite of hurdles which are related to high unit cost, low priority for the Indian Navy, and limited export market potential, has fast become a symbol of India-Japan defense cooperation. In the wake of growing challenges in the maritime domain, New Delhi knows that operational synergy with Tokyo is a strategic imperative.

strategic connectivity:

Alongside the deepening defense and security ties, is the issue of strategic connectivity that has presented New Delhi and Tokyo with big opportunities, as well as challenges. This year’s vision statement emphasized the development of India’s Northeast through the “Japan-India Act East Forum.” In addition to existing projects in Meghalaya and Mizoram, plans to construct a road from the Assam-Bhutan border to the Bangladesh-Meghalaya border are also underway.

While developing India’s northeast, which acts as a bridge connecting India, Southeast, and East Asia, is important, it comes with its challenges. The Northeast, as well as the northern parts of Myanmar that border it, have a long history of powerful insurgencies against the state. Although the situation seems stable for the moment, there is no guarantee that tensions will not flare up again. Additionally, the northeast is also home to a sensitive territorial dispute between India and China over Arunachal Pradesh.

This summit also “reviewed with satisfaction” the collaborative projects India and Japan have taken on in Sri Lanka, Myanmar, and Bangladesh as well as in Africa. With the aforementioned Bay of Bengal states, albeit slowly, joint connectivity and infrastructure projects are underway. However, in Africa, we are yet to see any formal announcements on joint infrastructure and connectivity projects. Until now, collaboration has been proposed with regards to health services and an SME development seminar in Kenya. Given that in May 2017, India and Japan announced the Asia Africa Growth Corridor (AAGC), this would be a crucial step for its success and progress. Along these lines, similar to their collaborative port projects in Sri Lanka (Trincomalee port) and along the Thailand – Myanmar border (Dawei port), both states could possibly think about joint cooperation in developing three key ports that Japan is working on in Nacala, Mozambique; Mombasa, Kenya; and Toamasina, Madagascar.

economic ties:

A key highlight of the summit was Tokyo’s pledge of $316.45 in yen loans for a total of seven projects that would include ¥150 billion for a high-speed Shinkansen system being constructed between Mumbai and Ahmedabad in western India. Further, in a move to enhance financial and economic cooperation, the Governments of Japan and India also welcomed an agreement to conclude a Bilateral Swap Arrangement (BSA) of $75 billion.

However, while this $17 billion Shinkansen project is supposed to be one of Modi’s flagship railway projects, progress is currently stalling due to the issue over land acquisition from Indian farmers that are unhappy with the compensation for the land being taken away. This risks the project completion date of August 2022 being pushed back yet again.

Further, bilateral trade between both states continues to underperform: the stark reality is that in just four years, Indian exports to Japan have almost halved to $3.85 billion in 2016-17, from $6.81 billion in 2013-14. And while it has been reported that Japanese investments in India during 2016-17 reached $ 4.7 billion registering a substantial jump from $ 2.6 billion during 2015-16, if one compares this to Japanese Foreign Direct Investment in Asia – primarily with China and many ASEAN states – India is still at the bottom of Japan’s FDI ladder.

Taking stock of the future partnership

The growing uncertainty in the United States, alongside Japan’s pragmatic yet cautious rapprochement with China, have brought up a number of questions regarding the affect it would have on the India-Japan bilateral partnership, let alone the summit. While the cause for concern is minimal, it is also unwise to simply state that the strength of India-Japan ties today show that neither New Delhi nor Tokyo are concerned about these recent moves and changes. In light of this, the partnership should be cognizant of two main points:

Firstly, China’s rise should incentivize increasing cooperation, but not determine it. That said, it is also important for India and Japan to simultaneously engage China independently of each other, each for their own economic and security benefits, as well as the benefits of their respective neighborhoods.

Thus, though there have been concerns on how Japan has most recently calibrated its position on China’s Belt and Road Initiative, with some Japanese companies, including Nissin expressing their interest in third party collaborations in BRI projects, this in itself is not a setback of any sort to the partnership. Indeed, India for its part, despite boycotting the BRI last year, has tried to reach out to China in recent months with Modi’s informal summit with Chinese President Xi Jinping in Wuhan. These independent steps are important to keep engaged one of Asia’s most important players, and are crucial if India and Japan are to constitute two leading, democratic ends of the Indo-Pacific.

Secondly, the geopolitical consequences that may arise as a result of the domestic political situations in the United States and India are definitely a cause for concern. The United States will hold its midterm congressional elections on November 6 which could affect Trump positively or negatively; in India, Modi is up for elections next year, and also faces crucial Assembly elections, results of which will be announced on December 11. In this scenario, it is only Abe, who having won himself another three years at the top of his ruling Liberal Democratic Party, stands politically steady.

While this possibility of change highlights the delicate position of leaders, it is also undeniable that personal relationships between leaders do play an important role in shaping ties between states.  In light of this, it is worth noting that the growing strategic and economic convergence of India-Japan interests have more often than not been attributed to the strong and personal rapport shared by Modi and Abe. However, for this strong bilateral partnership to endure in the Indo-Pacific, it should be able to sustain itself beyond leaders. After all, the slogan is “A strong India is good for Japan, and a strong Japan is good for India” – not a strong Modi is good for Japan, and a strong Abe is good for India.

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Vindu Mai Chotani is a PhD student at the University of Tokyo's Graduate School of Public Policy. Her dissertation focuses on Abe’s Kantei Diplomacy, while her broader research examines Japanese foreign policy, India-Japan relations, and the evolving security architecture of the Indo-Pacific.

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