Home > 2019 > Priorities for Modi: Thrust from Act East to Indo-Pacific

Mainstream, VOL LVII No 27 New Delhi June 22, 2019

Priorities for Modi: Thrust from Act East to Indo-Pacific

Monday 24 June 2019

by Rajaram Panda

This article was written before the Bishkek Summit of the Shanghai Cooperation Organisation (SCO).

Context

The general elections in India conducted in seven phases lasting over 40 days to the 17th Lok Sabha (Lower House) resulted in a resounding victory for the ruling Bharatiya Janata Party-led National Democratic Alliance, thereby giving Prime Minister Narendra Damodardas Modi a second tenure in office. There was plenty of acrimony between the contending political parties during the electio-neering process but all these happily ended as the electorate gave another mandate to the NDA to remain at the helm for the next five years. Even the exit poll had categorically given such a verdict in the NDA’s favour.

Such a strong mandate ensuring political stability augurs well to continue the economic reforms that had remained unfinished. Foreign economic partners shall now have the confidence with the government’s policies and engage with a positive mind. India’s economic growth rate is now projected to jump close to 10 per cent. The purpose of this analysis is not to focus the future economic growth trajectory. The focus remains limited to what Modi’s victory means to his Act East Policy and the economic-strategic dimensions of such an approach.

In 2014 when Modi formed the government after being voted to power, in a major initiative he had invited the heads of the SAARC member- countries to convey the message to the world that his government believes in good neighbour-hood policy. Despite that India had and still has a kind of love-hate relationship with Pakistan, Modi did invite the then Pakistani Prime Minister Nawaz Sharif as a peace move. However, Pakistan continued to foment terrorist activities and cross-border incursions, leaving India with no choice than to strike hard months before the nation went to polls. The objective was to destroy the bases from where terrorists were operating. This became a campaign issue, which went in Modi’s favour and proved how he could be tough when it comes to dealing with terrorism, notwithstanding the extension of his hands for friendship.

Focus from SAARC to BIMSTEC

This time the Modi Government decided to invite leaders from BIMSTEC countries to his inauguration, leaving out Pakistan, which is not a part of the seven-member regional grouping. The BIMSTEC (Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation) comprises Bangladesh, India, Myanmar, Sri Lanka, Thailand, Bhutan and Nepal) with its secretariat located in Dhaka. Pakistan Foreign Minister Shah Mehmood Quereshi downplayed Pakistan Prime Minister Imran Khan not being invited to Modi’s swearing-in observing that India’s internal politics did not permit Modi to extend an invitation to his Pakistani counterpart. According to Quereshi, a meeting for the sake of dialogue to find a solution to the Kashmir issue, as well as Saichen and Sir Creek disputes, would have been a significant measure instead of attending the swearing-in ceremony.

It is a different matter that Modi had congratulated Imran after he won the general election in 2018 and wrote a letter as well. This time, Imran returned the compliments by congratulating Modi on his victory. Yet, an invitation eluded him, which is why India’s tough stance on terror continues. Though Modi and Imran are scheduled to attend the annual China-dominated Shanghai Cooperation Organi-sation (SCO) grouping summit in Bishkek, Kyrgyzstan, on June 13-14, a meeting even on the sidelines between the two does not seem likely.

Pakistan Factor

Prime Minister Modi adopted a tough stance in his first term in dealing with terror and Pakistan’s complicity to terrorist activities. Relations between the two neighbours have remained soured since the division of the Indian subcontinent 70 years ago. Both have fought wars in the past and at times the spectre of military escalation to assume a nuclear dimension has kept the region fearful. This time around, having won 303 seats in the 543-member Lok Sabha, Modi is emboldened and is likely to toughen his approach further. Months prior to the polls, tensions flared up between the two countries after a suicide bomber of Pakistan-based Jaish-e-Muhammed (JeM) killed 40 CRPF personnel in Kashmir’s Pulwama district on February 14, 2019. Amid mounting outrage, the Indian Air Force carried out a counter-terror operation, hitting the biggest JeM training camp in Balakot, deep inside Pakistan on February 26. The next day, Pakistan Air Force retaliated and downed a MiG-21 in an aerial combat and captured an IAF pilot. Fearing further reprisal and not to escalate tensions, Pakistan was forced to hand over the captured pilot to India.

India’s policy of not having talks with Pakistan unless it stops cross-border terrorism remains unchanged. India has not been engaging with Pakistan since early 2016 following a terror attack on the Indian Air Force base at Pathankot in January that year, maintaining that talks and terror cannot go together.

In a reflection of India’s reluctance to engage with Pakistan, the government preferred to invite leaders of the BIMSTEC countries for the swearing-in ceremony of Narendra Modi as the Prime Minister for a second term on May 30. Besides, among other guests to the function were Kyrgyz President Sooronbay Jeenbekov, the current chair of the SCO, and Mauritius Prime Minister Pravind Jugnauth. Mauritius, an Indian Ocean archipelago, has huge strategic importance to India, and therefore reaching out to Mauritius is significant in Modi’s foreign policy radar in his second term. India has done well to use the swearing-in event for its outreach to regional organisations and countries that could help India realise its growing global economic and strategic ambitions.

As mentioned, Modi’s 2014 outreach to the SAARC countries failed to take off due to tensions with Pakistan. This time, it was Modi’s fresh effort to reach out diplomatically to the neighbourhood, diaspora, and the China-Russia-led regional grouping of Central Asian countries. Following is the guest list during Modi’s swearing-in ceremony on May 30, 2019, and what does this outreach signify? The choice of leaders demonstrated that it is a part of Modi’s “Neighbourhood First” focus.

Mohammad Abdul Hamid, President of Bangladesh, represented Prime Minister Sheikh Hasina, who was travelling to Japan. Maithri-pala Sirisena, President of Sri Lanka since 2015, represented Sri Lanka. His attempt in 2018 to replace Prime Minister Ranil Wickremesinghe with former President Mahinda Rajapaksa was thwarted by Sri Lanka’s top court. U Win Myint, President of Myanmar and an important ally of State Counsellor Aung San Suu Kyi, represented Suu Kyi, who was travelling to Europe. Myint, a former political prisoner has been President since March 2018 as Suu Kyi is constitutionally barred from becoming President.

Special case of the Kyrgyz Republic 

Sooronbay Sharipovich Jeenbekov, President of the Kyrgyz Republic since November 2017, was earlier Prime Minister from April 2016 to August 2017; he attended the swearing-in as the Kyrgyz Republic Chair of the SCO. He was a surprise special guest.

 The strategic dimension to extend the invitation to the Kyrgyz Republic is deeper than just an invitation to the SCO Chair. The Central Asian nation is looking for a range of defence systems to modernise its armed forces that are largely of Russian origin. There are speculations at the time of writing that like with Vietnam, India is likely to extend $100 million defence line of credit to the Kyrgyz Republic. As another step towards enhancing its strategic footprint and in line with its aspirations of emerging as a global player, this invitee was another step up for bilateral ties that have been on an upswing and the Central Asian nation’s request for defence equipment elevates the strategic relationship beyond the current level of bilateral exercises and the construction of a joint mountain warfare training centre.

Three areas in particular have been identified by Kyrgyz defence teams that visited India over the past few months and a formal letter of request is being processed to take the acquisition ahead. The process will involve approvals from the Ministry of External Affairs. Given the commonality of equipment, the Kyrgyz military wants to procure simulators that have already been purchased by the Indian defence forces. The request for equipment includes products made by the Hyderabad-based Zen Technologies. The company has a wide range of products for Russian equipment, including driving and gunnery crew equipment for T-72 and T-90 tanks, as well as for the BMP Infantry Combat Vehicles.

A Kyrgyz military team visited several private sector companies in India to identify an equipment list that includes land-based systems upgrades by Larsen and Toubro (L&T) and protective equipment by MKU. Indo-Kyrghyz bilateral relations have been on a strong footing since 2011 when the joint ‘Khanjar’ series of exercises started but saw an acceleration after Prime Minister Narendra Modi’s visit in 2015 to all the Central Asian republics. Since then three IT-Centres have been established by India at Kyrgyz Military Institutions and the Khanjar series have evolved into more complex exercises. Both nations are jointly constructing the Kyrgyz-Indian Mountain Training Centre in the city of Balykchi and India helped to equip the Kyrgyz Military Field 2nd Level Hospital for UN Peacekeeping Missions. (Source: Economic Times, May 30, 2019)

Among others in the guest list included Khadga Prasad Sharma Oli, Prime Minister of Nepal. As Chairman of the Nepal Communist Party, Oli was earlier the Prime Minister from October 2015 to August 2016. His relationship with India soured during the infamous Nepal blockade, but ties improved since he returned to power in 2018. Lotay Tshering, Prime Minister of Bhutan, represented the Himalayan nation. As the leader of the Druk Nyamrup Tshogpa, he has been in power since November 2018. The geographic location of this tiny nation adds huge strategic significance for India as keeping friendly relations with Bhutan would mean keeping China’s strategic influence in check. Mauritius was represented by Prime Minister Pravind Kumar Jugnauth. He has been in office since 2017 and is also his country’s Minister for Finance. He is the son of former Prime Minister Sir Anerood Jugnauth, and visited India in January 2019 as the Chief Guest of the Pravasi Bharatiya Divas held in Varanasi, which is Modi’s parliamentary constituency. Grisada Boonrach was the Special Envoy of Thailand. Boonrach has been Thailand’s Agriculture and Cooperatives Minister since 2017. A trusted aide of Thailand’s Prime Minister Prayuth Chan-o-cha, Boonrach attended on behalf of the Thai Prime Minister, who was busy with the formation of the government in Thailand

Why BIMSTEC?

Why is BIMSTEC prioritised in the Modi Govern-ment’s foreign policy? There are both economic and strategic dimensions behind it. The Bay of Bengal is an area growing in economic and strategic importance. This is derived from its position as the principal maritime connection between the Pacific and Indian Oceans and from the good economic prospects of many Bay of Bengal states. With twenty years of its existence, BIMSTEC has made substantial progress in recent years in the regional integration process. The Bay of Bengal could become the key economic connection between East and South Asia and a potential zone for Asian economic growth. An overarching priority for the BIMSTEC member-states would, therefore, further strengthen the regional economic process and the Modi Government seems to have seized this opportunity to further India’s economic and strategic interests. Prime Minister Modi’s new vision and outreach programme through the BIMSTEC is aimed to achieve a new paradigm of the integration process.

China Factor

BIMSTEC was set up to act as a bridge between South and South-East Asia. India’s pivoting from SAARC to BIMSTEC is likely to have been motivated by the fact that co-operation within SAARC has been a non-starter, with Pakistan’s hostility towards India standing in the way of meaningful co-operation among South Asian countries. Consequently, BIMSTEC was founded in 1997 and India turning to it for regional co-operation is a smart move. There is a strategic dimension to India’s participation with BIMSTEC as well. Several BIMSTEC countries are participants in China’s ambitious Belt and Road Initiative. Many are Bay of Bengal littorals, too. Given India’s mounting concern over the possibility of BRI countries giving China access, even military access to the Bay of Bengal and the Indian Ocean, Delhi’s stepping up of engagement with BIMSTEC could help it counter Beijing’s rising influence in the neighbourhood. Similarly, India, which only recently became a full-fledged member of the SCO, is hoping to expand its economic and strategic footprint in Central Asia and beyond. India expects that by using the swearing-in event for diplomatic outreach will give the new government an early start to achieve foreign policy goals.

 Besides the members of BIMSTEC in favour of regional cooperation in the economic realm, they agree on the need for security cooperation amid the growing menace of terrorism across the globe. A week-long first of its kind joint military training exercise for seven member-nations of BIMSTEC was held in Maharashtra’s Pune district in September 2018. It focused on counter-terrorism in semi-urban areas. Named MILEX-18, the field training exercise held between September 10 and 16 at the city’s Aundh Military station was a crucial step towards regional security and diplomacy. The armies of India, Bangladesh, Bhutan, Nepal, Sri Lanka, Myanmar, and Thailand participated. “MILEX 18 was a useful forum which provided the opportunity to discuss the issue from a military point of view with an endeavour to create synergy, better understanding and evolve as an institutionalised multi-lateral forum for regional cooperation in the field of counter-terrorism operations.”

The objective behind this exercise was to initiate a process of sharing counter-terrorism strategies with member-countries. Platoon-sized contingents of the BIMSTEC nation-armies took part in the exercise conducted at the Aundh Military Station’s foreign training node. The exercise included training in search-and-cordon operations and handling and neutralisation of improvised explosive devices (IEDs) among other things.

This multilateral military exercise was an event that demonstrated the fact that India accords highest priority to regional cooperation within the BIMSTEC framework, consistent with the country’s “neighbourhood first and Act East policy”. The focus areas are regional cooperation in UPDATED: SEPTEMBER 08, 2018 00:14 ISTkey sectors of security, counter-terrorism, disaster management, connectivity and trade, agriculture and poverty elevation and people-to-people contact. The Act East policy is an effort by India to boost its influence through economic and strategic linkages with the neighbouring South-East Asian sub-region. It was originally conceived as an economic initiative, but has gained political, strategic and cultural dimensions including establishment of institutional mechanisms for dialogue and cooperation.

Challenges for India

India, being the largest nation in South Asia, has added responsibilities to take other members on board and build consensus on contentious issues or wherever there are policy differences. For example, in 2018 Nepal as the BIMSTEC Chair expressed concern that the pace of cooperation among member-countries was not satisfactory and demanded “clarity” on its vision, as India assured it was committed to make its neighbours part of its growth strategy. Addressing a session — Towards a Bay of Bengal Community: Development, Growth and Security” at the Raisina Dialogue in New Delhi, Nepal’s Foreign Secretary Shankar Das Bairagi had said that a charter was needed to enhance the profile of the initiative. (Source: Times of India, January 18, 2018)

Countering Bairagi’s point, Secretary (East) in India’s Ministry of External Affairs, Preeti Saran (now retired), sounded all “positive” about the journey of the BIMSTEC grouping over the past two decades of its existence. She reminded that the very fact that Prime Minister Modi decided to invite heads of state of the 10-member ASEAN grouping as Chief Guests at the Republic Day celebrations on January 26, 2018 in New Delhi was itself proof enough that India accords importance to BIMSTEC policies. Indeed, there is a political will and closer coordination among its members and therefore the grouping is poised to move ahead. (Source: Times of India, January 18, 2018) As a part of India’s Act East policy, India has been according greater importance to BIMSTEC as SAARC talks are stalled for the past few years and the decision to extend an invitation to the BIMSTEC heads to the swearing-in ceremony of Modi’s second stint is a demonstration of India’s sincere desire to engage not only with the grouping but for the growth of the entire region. Mutual prosperity can be achieved if all stakeholders are on board and India is not shy to take the lead. The only country left out in this growth matrix is Pakistan whose terror links and complicity of the Army in the governance process has gone against its national interests.

 The BIMSTEC grouping represents nearly one-fifth of the global population with a combined GDP of close to $ 3 trillion. Actually, the BIMSTEC initiative has the strength of pooling complementary strengths of nations from the SAARC and ASEAN groupings.

Like Nepal, Thailand has also some reservations and expressed concern over the proposed BIMSTEC motor vehicle pact. Its concern is that the proposed BIMSTEC Motor Vehicle Agreement would give Indian truckers access to the country through a trilateral highway via Myanmar as it wants domestically-owned transport firms to be allowed on the route to protect the interests of local players. Thailand’s concerns were conveyed by the Thai envoy, Chutintorn Sam Gongsakdi, during the BIMSTEC MVA meeting that took place in New Delhi in April (8-10) 2018. (Source: Press Trust of India, April 11, 2018) Thailand’s concern can be discerned from the fact that no delegation from the Thai side attended the meeting, leaving the Thai embassy to clarify the country’s stance.

Thailand wants to limit the participation of trucking companies that belong to the member- countries to set a limitation of 51 per cent (stake of) Thai or Indian companies. Being aware of the fact that India has liberal provisions that permit 100 per cent foreign investment in the transport service sector, Thailand fears that Indian trans-portation firms may “wipe out” the Thai industry because it has “no limit” on foreign ownership.

India, Thailand and Myanmar are working on a nearly 1400 km-long highway that would link India with South-East Asia by land and give boost to trade, business, health, education and tourism ties among the three countries. The BIMSTEC MVA is a crucial part of the plan. The trilateral highway is near completion. As Gongsakdi observed, ”Physical connectivity, which is the physical building of the road, and the other is the soft connectivity or the software, which means the system, the rules, the regulations, these can happen in parallel.” Bangladesh, India and Nepal have already agreed on the text of the operating procedures for passenger vehicle movement in the sub-region under the Bangladesh-Bhutan-India-Nepal (BBIN) MVA. However, Bhutan is not a party to the MVA yet.

Projections for the Future

After assuming power in 2014, in a major foreign policy thrust, the Modi government rechristened India’s ‘Look East Policy’ to ‘Act East Policy’, thereby injecting result-oriented dynamism. This dynamism is being reflected in India’s role in a number of sub-regional programmes and projects such as the BBIN, the Trilateral Highway, etc., and is actively contri-buting to the success of several regional initiatives such as ASEAN, EAS, BIMSTEC, IORA, RCEP, among others.

In a surprise announcement, Modi inducted the former Foreign Secretary, S. Jaishankar, a seasoned diplomat with vast experience but with no political experience, into his Cabinet as the Foreign Minister to steer the country’s foreign policy and diplomacy. As an extension of his outreach initiative with focus on the neighbourhood, Modi choose Maldives to be the first country to make his foreign visit in his second term (June 8) and Sri Lanka (June 9). Both trips are significant because they will be used to signal a renewed focus in the Indian Ocean Region and India’s immediate neighbourhood.

The Act East policy and outreach to the South East Asian nations, with Japan being a major link in this transformative web aims to create a new regional order. Modi’s address at the Shangri La Dialogue in Singapore in 2018, wherein he espoused for a “free, open, prosperous and inclusive Indo—Pacific Region”, is illustrative of India’s foreign policy goal in the region. Though less relevant in the context of the present analysis but far more important in the larger strategic context, one major thrust in the foreign policy orientation has been taking the India-Japan strategic partnership to an entirely higher level, adding a multifaceted dimension to India’s common commitment, based on shared values and principles, to promote a rules-based order in the Indo—Pacific is welcome to all stakeholders in the region, which is why the BIMSTEC initiative as Modi’s second term begins is hugely significant. Gradually, Act ‘East’ will be transformed into Act ‘Indo-Pacific’. Nonetheless, ‘Connectivity’ is central to most of the regional initiatives in which India participates.

Prabir De of the Research and Information System for Developing Countries (RIS), a Delhi-based think-tank, in a brilliant analysis of Modi’s Act East Policy and what it means for India and the region has explained the nuances of this strategy. (Source: “Act East to act Indo-Pacific: Agenda for the new government”, Economic Times, May 31, 2019) Modi has rightly realised that BIMSTEC is the natural connector of South and South-East Asia. Having hosted the heads of all BIMSTEC member-countries during his swearing-in ceremony, now his focus would be to complete the commitments taken at the fourth BIMSTEC Summit held at Kathmandu in 2018. While the BIMSTEC connectivity master plan is ready, countries must enhance the negotiation process to conclude BIMSTEC MVA, BIMSTEC coastal shipping agreement, and BIMSTEC TFA. At the same time there is a need to inject capital and resources towards strengthening the BIMSTEC Secretariat in Dhaka.

Seen differently, as a counter to China’s expansionist design and muscle-flexing activities in the South China Sea, the small countries of the region expect India to play a pro-active role to maintain balance of power. Forging new partnership with countries in the region is therefore an appropriate option for India. With this BIMSTEC initiative, the Modi Government can actualise Modi’s dream slogan of Sabka Sath, Sabka Vikas, Sabka Vishwas (With all, progress for all, Trust from all), which catapulted him for a second term in office.

A last point to mention: India’s North-East remained neglected for a long time, despite huge potentials for the development of the region. As a marked departure from the previous govern-ments, the Modi Government introduced result-oriented initiatives for the region so that the sense of alienation felt by the people of the region is removed. The task started in Modi’s first term remains incomplete. Now there is another opportunity for the Modi adminis-tration to complete the task. Fortunately, Japan has partnered with India in many develop-mental projects in the North-East. The economic isolation felt by the people of the Northeast would thus have been removed. That would be another feather in Modi’s cap.

Dr Rajaram Panda, former ICCR India Chair Visiting Professor at Reitaku University, Japan, and former Senior Fellow, Institute for Defense Studies and Analyses, New Delhi, is currently the Lok Sabha Research Fellow, Parliament of India, New Delhi. E-mail: rajaram.panda[at]gmail.com  

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