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Millennium Post

Manmohan’s Japan visit SIGNIFICANT!

With hindsight, it was a right diplomatic decision on the part of Prime Minister Manmohan Singh to postpone his scheduled tour of Japan six months ago in view of political uncertainty and brewing national election there. India had rightly guessed the possibility of a regime change in Japan. And, it must be to the delight of Singh that his old friend Shinzo Abe, leading the conservative, pro-big business Liberal Democratic Party (LDP), has once again become Japan’s prime minister, after a gap of nearly six years. Although Singh had a very good understanding with Shinzo Abe’s predecessor, leftist Yoshihiko Noda, as well, the Indian prime minister enjoys a special personal relationship with Shinzo Abe, who during his India visit in August 2007 was accorded the honour to address a joint session of Parliament.
 
Abe, then, began his famous speech with a quote from Swami Vivekananda, ‘The different streams having their sources in different places, all mingle their water in the sea.’ He used the simile of ‘the confluence of the two seas (the Pacific and Indian Ocean)’ to describe the Indo-Japan relationship. The intervening period, despite change of guards in Japan and its fall in the global ranking from the earlier second to the present third largest economy, has witnessed Indo-Japan relations growing from strength to strength. Shinzo Abe had said a ‘broader Asia’ that broke away geographical boundaries was now beginning to take on a distinct form. Our two countries have the ability – and the responsibility – to ensure that it broadens yet further and to nurture and enrich these seas to become seas of clearest transparence. Singh’s desire personally greet Shinzo Abe reflects the growing friendship between the two nations. It also comes at a time when Japan is facing military threat from China over the ownership of Senkaku Islands, which Japan controls. China’s claim over maritime assets in and around the China sea has earlier made India’s public sector ONGC Limited to abandon a joint-venture hydro-carbon drilling project with Vietnam in the latter’s economic zone.
 
China has also been at the loggerheads with the Philippines over maritime zone claims. The Sino-Japan relations have nearly reached a flashpoint over the sovereign control of the Senkaku islands.

While these issues are most likely to figure in the talks between Singh and Abe, the scope for a further bi-lateral economic cooperation has brightened following the latest sharp fall of Japan’s trade and investment in China. The signing of the comprehensive India-Japan economic partnership agreement (CEPA) in February 2011 and the growing participation of the Japan International Cooperation Agency (JICA) in India’s capital intensive infrastructure projects are bringing benefits to both the nations. JICA is funding a host of projects, including water supply and sanitation, industrial corridors and metro railway, covering states such as Andhra Pradesh, Odisha, Maharashtra, Delhi, Chennai, Karnataka and West Bengal.
 
Japan has been steadily making foreign direct investment (FDI) to India. The Japanese FDI inflow to India between April 2000 and 2019 was $13.3 billion, placing it in the fourth place after Mauritius, Singapore and Britain. Japanese firms operating in India support over 1,52,000 local jobs. Japan is also importing more from India as the two sides targeted at doubling the bilateral trade to $25 billion by 2014. India’s export to Japan jumped to $5 billion in 2010-2011 from the earlier level of $3 billion.

The items of export include mineral fuels, mineral oils, natural and cultured pearls, precious and semi-precious stones, iron and steel, fish and fodder. On the other hand, Japanese exports to India include boilers, machinery appliances, optical, medical and surgical instruments, and articles of iron and steel. Now with Abe in control in Tokyo, the bilateral trade target should become easier to attain.

India, however, needs to do much to enthuse Japanese investors to rapidly increase their FDI coverage into India. Japanese manufacturers presently operating in China, who are forced to downsize their presence there, may enlarge their business engagements and investments in India. The Indian authorities should seize the opportunity to encourage Japan and other South East Asian countries to participate in India’s economic expansion, instead of wasting valuable time in fruitless ideological debates.
 
Economic diplomacy is all about nurturing existing trade and investment relations, creation of new opportunities and grabbing the unexpected ones suddenly arising out of politically sensitive movement of capital from one country to another or one region to another. Both Japan and India have gained from the presence in India of large Japanese conglomerates such as Mitsubishi, Itochu, Honda, Suzuki, Toyota, Nissan, Sony, Kobe and Nippon Steel, Kawasaki, Nomura, Dai Ichi, to name a few.
 
The forthcoming Singh-Shinzo dialogue must explore fresh opportunities to further step up trade, investment and diplomatic engagements between the two countries following the changing strategic environment in the Pacific as well as Indian Ocean regions. Such a move will go a long way to make Abe’s ‘Broader Asia’ strategy advocating a ‘quadrilateral’ linkage of Japan, Australia and India with the United States more meaningful.
 
The mild-mannered Indian prime minister may also help fine-tune the strategy to achieve the objective without upsetting the ongoing confidence building exercise with China despite the fact that the latter continues to play hard ball with India. Even the latest regime change in China has not softened its attitude towards India, whose net annual contribution to the Chinese economy has reached $60 billion. Maybe, China needs to be told the days of bullying sovereign nations to submission are over.
 
However, the ‘Broader Asia’ dialogue should aim at reducing tension in the region and not fanning the fire of imperialist attitudes of both the old and emerging economic and defence super-powers. IPA
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