42. India and Japan Move Closer Together

India and Japan Move Closer Together October 26, 2010 | 1214 GMT EVERETT KENNEDY BROWN/AFP/Getty Images Indian Prime Minister Manmohan Singh (L) and Japanese Prime Minister Naoto Kan in Tokyo on Oct. 25 Summary The leaders of India and Japan wrapped up a meeting in Tokyo on Oct. 26. The meeting highlights the growing alignment of strategic interests between the countries. With concerns about China rising in both Tokyo and New Delhi, this process can be expected to accelerate. Analysis Indian Prime Minister Manmohan Singh and Japanese Prime Minister Naoto Kan ended a visit Oct. 26 in Tokyo. The meeting was part of a broader East Asia tour that will take Singh to Malaysia on Oct. 26 and Vietnam for the 17th Association of Southeast Asian Nations leaders’ summit Oct. 28-30. India and Japan are pursuing a closer relationship, though the two have not moved especially rapidly in this regard. Still, their strategic interests continue to align, most notably on economic cooperation and the need to counter China’s growing clout. Throughout most of history Japan and India have existed in separate worlds, with the only substantial connection arising from Indian religious practices migrating east across Asia. During the Cold War, Japan and India did not have a basis to develop a friendly relationship. The Soviets were a dire enemy of the Japanese due to longstanding Russo-Japanese animosity as well as to Japan’s role as the bulwark of the U.S. alliance in the Eastern Hemisphere, yet India worked better with the Soviets than it did with the United States. Meanwhile, China, a potential threat capable of driving India and Japan closer together, was mired in internal chaos. Toward a Japanese-Indian Alignment After the Soviet collapse, realignment ensued. Japan drew a hard line against the Indians after they tested nuclear weapons in the late 1990s. But economic cooperation continued and the nuclear row gradually subsided. Japan and India have grown closer since then, symbolized by Japan’s providing construction, technology and investment for the New Delhi metro project in the early 2000s and the2005 visit to India by then-Prime Minister Junichiro Koizumi. The two have increased diplomatic exchanges and military exercises since then. Relations have especially improved in recent years as the two countries’ core strategic interests increasingly have aligned. Economically, the match is logical: India is a fast-growing, developing country with a booming population and a need for technology to upgrade its infrastructure and energy and manufacturing sectors, while Japan is fully developed — with the ability to provide high-tech and value-added services and goods — but its growth has stalled over the past two decades, its population and workforce are shrinking and it needs to diversify its investments away from China. Strategically, both countries have felt pressured by China’s rising economic and military power, especially over the past few years. Beijing recently has become more aggressive in pressing its claims in disputed territories, with Japan in the East China Sea and with India in Kashmir and Arunachal Pradesh. AsChina and Japan seek to expand their naval presences and operational capabilities in the Indian Ocean to secure vital supply lines — namely for oil from the Middle East — India has come to see Japan as a naval partner against what it sees as Chinese encirclement arising from China’s port of call agreements in Myanmar, Bangladesh, Sri Lanka, and most threateningly to India, in Pakistan. Japan, meanwhile, sees exercises and exchanges with India’s navy as a natural gateway to the Indian Ocean. While China is a potential military threat to both Japan and India, neither Tokyo nor New Delhi fundamentally threaten each other, and both can help the other balance China. In Southwest Asia and Southeast Asia, two additional theaters of concern, India and Japan do not compete much and could cooperate. In Afghanistan, Japan’s contribution to international security efforts is minimal, focusing solely on civil assistance, development and humanitarian aid, and investment, since the Democratic Party of Japan in 2010 discontinued an aerial refueling mission to support the U.S. and NATO operations. Japan’s contributions fall in line with India’s interest in stabilizing Afghanistan. New Delhi is attempting to establish a foothold in Afghanistan to serve Indian interests against Chinese-supported Pakistan after U.S. and NATO forces depart. Japan and India have little reason to see each other as threats in Southeast Asia, an economically promising region that is becoming the site of growing competition among global powers. China’s influence is spreading and entering new areas, the United States is seeking to revitalize alliances and form new partnerships, and Russia is reactivating ties for the first time since the collapse of the Soviet Union. In this context, especially with its eyes on China, India is signaling it wants to renew its Look East policy — nearly two decades old, but so far unremarkable — in this region historically permeated by Indian influence, as Singh will emphasize during his visits to Malaysia and Vietnam. Japan meanwhile is seeking to maintain its advantage in the region and remain competitive. The two do not conflict in the region, and both can be expected to welcome another contender for influence as a means of diluting Chinese influence. Thus, the Indo-Japanese strategic relationship is growing based on each side’s needs. The alignment has received a boost as the United States mostly endorses their cooperation. Washington is currently cultivating stronger ties with India, such as by paving the way for India to enter the global civil nuclear energy market and by encouraging its chief East Asian ally, Japan, to embrace India as a civil nuclear partner despite its failure to sign the Nuclear Non-Proliferation Treaty. The United States also has encouraged major alliance partners in Asia to take a more active role in dealing with regional security contingencies, and this means promoting allies’ relations with India and nudging Japan to overcome its reluctance in global security matters. Yet simultaneously the United States is being reminded that India is fiercely independent and distrustful of the U.S. relationship with Pakistan and that Japan is yearning for greater independence in determining its foreign policy. Even so, it sees the need to counterbalance China as important and does not foresee an immediate threat from the Japanese, who remain reliant on U.S. security guarantees for the near future. India and Japan, Introverted Powers India and Japan are both somewhat introverted states that do not always open up to outside powers naturally, have thick bureaucracies that do not move quickly on new initiatives, and are having trouble meeting their goals to boost trade. Total trade, especially Indian imports of goods from Japan, began to grow faster in 2004, increasing from less than $4 billion in 2002 to $11.6 billion in 2009 and $7.7 billion in the first half of 2010. But it has failed to meet the goal of $20 billion by 2010, a goal now moved to 2012. Investment flows have fluctuated considerably, with Japan typically contributing about 1-3 percent of India’s total foreign direct investment since 2003-4. However, major investments can change this impression — the Japanese share in 2002-3 was as high as 13 percent due to the Delhi metro, while it reached 10.7 percent due to several major automobile and electronics industry investments in 2008-9. The defense relationship has, until recently, developed slowly. The impetus lies mostly with Japan — since Japan’s interest in the Indian Ocean is based on its oil supply line security — and Tokyo has both constitutional and historical inhibitions in reclaiming a high-profile international role for its military. Similarly, on the nuclear energy front, the two have moved haltingly toward concluding a deal, with little progress until mid-2010. Japan is a non-nuclear armed state, and as it frequently reminds others, the only state to have suffered a nuclear attack. It therefore takes a staunch line against nuclear proliferation. It opposed India’s nuclear tests in the late 1990s and criticized the U.S. decision to grant India an exemption from the international nonproliferation regime in 2005. Japanese-Indian negotiations on concluding a civil nuclear energy cooperation agreement since June have been complicated by this difference in perspective. Yet despite these and numerous other obstacles, that the two states’ strategic interests are so closely aligned has enabled them to move forward even in trouble spots. Singh and Kan announced Oct. 25 that they had concluded years-long negotiations on a Comprehensive Economic Partnership Agreement, which now awaits approval in the Japanese Diet (parliament). This is no mean feat, as both states are highly protectionist and not generally very handy at free trade agreements. Their economic roles are fairly well differentiated (competition is minimal), however, and they both have an interest in expanding markets so they do not lose out as others, especially China and other East Asian states, expand markets enthusiastically. Recognizing Japan’s sensitivities, Singh declared he would not pressure Japan on forming a nuclear deal. Japan’s leader said, however, that he would speed up negotiations on an agreement, as Tokyo comes to accept India’s status and weighs the risk of not taking economic advantage of India’s big plans for its nuclear energy sector. (Japanese firms are both linked to U.S. firms taking a role in India’s nuclear development and would provide critical equipment for the Indian nuclear sector.) In addition, the two leaders agreed to streamline visa requirements and discussed their growing defense ties as well as exploring further areas of cooperation, including alternative energy and rare earths exploration and development — though India only has about 3 percent of the world’s known rare earth reserves. They also spoke in favor of each other’s bids to join an expanded U.N. Security Council as new permanent members. While the Indo-Japanese strategic partnership is developing incrementally, the two states’ deepest strategic interests suggest it will continue to advance. And with concerns about China growing more pressing, especially given China’s harder push on territorial disputes, New Delhi and Tokyo can be expected to accelerate this process. Give us your thoughts  on this report For Publication Not For Publication Read comments on  other reports Reader Comments