Millennium Post


By choosing Japan for his first major diplomatic port of call outside India’s neighbourhood, Narendra Modi has only confirmed what his critics and admirers have by now settled for that he is not only the most unconventional but also most pragmatic of all Indian prime ministers in thoughts and actions, so far. Last week, the prime minister first stepped out of the country to meet India’s most trusted and friendly neighbour, Bhutan, a land-locked historically royal state turned the youngest republic in the region, at its premises to throw open the country’s economy and agriculture for the benefit of the people of Bhutan, help develop Bhutan’s natural resources, including energy, and buy back the surplus for the economic benefit of both the neighbours. Bhutan is India’s only border state that had consciously stayed away from Chinese any major assistance for economic development until now.

Why Japan, the next? Because, under the changing focus on geo-economic diplomacy as different from conventional foreign relations based on geo-political considerations promoting geographical and military hegemony or power politics through strategic alliances, Japan promises to be India’s best suited ally. A joining together of the world’s third largest economy and, demographically, the second largest market could end up in the creation of the globe’s most formidable economic powerhouse, outmaneuvering even the United States and the People’s Republic of China, within the next 12-15 years. How could geeky Narendra Modi, fondly called a ‘development freak’, not embrace such an opportunity at the first instance to reach out to Japan’s most dynamic leader, Shinzo Abe, also a development freak and a geek, who dreamt to build an economic axis with India and mineral rich Australia? Abe had made his vision and ambition known to the world during his very first innings as Japan’s Prime Minister and maiden address to the joint session of India’s Parliament in 2007.

Japan was dethroned as the world’s second largest economy in 2011 by China. Incidentally, it was during Prime Minister Vajpayee’s time that the two countries first charted a collaborative economic engagement in a sustained manner.

 The chemistry between the two dreamers – Modi and Abe – has been so strong that the Indian PM accepted the Japanese PM’s invitation instantly over a phone call which Abe made even before Modi’s formal swearing-in to congratulate him on his emphatic election victory. Such a top-level bilateral engagement over phone between two heads of governments may be unheard of in the annals of diplomacy. That makes Modi different. He couldn’t wait for a formal swearing-in and diplomatic formalities to accept the call for his Japan visit may be because he did not want India’s development delayed even for a day due to diplomatic protocol.

Rejuvenating India’s nearly-paralysed infrastructure industry’s growth held precedence over the diplomatic protocol. For fast-paced Modi, time is running out. He has to deliver his promises before the Indian youth, who gathered in large numbers to vote him to power. He has big dreams to fulfill. He has to link all Indian village panchayats with roads, water supply and minimum sanitation, telephones and broadband internet services, electricity transmission, education, healthcare networks.  He needs to improve operations of existing seaports, river ports and airports and build new ones. He wants industrial corridors, dedicated railway freight corridors, high-speed trains and 100 new cities alongside a digital economy, fast. Who could be a more appropriate partner in such a gigantic development venture than Japan? To Prime Minister Abe, such a collaborative venture with India could mean a windfall for the stagnating Japanese economy. It is a win-win situation for both the countries. Extending the invitation to visit Tokyo, Abe had told Modi: ‘I would like to work closely with you towards further development of the Japan-India Strategic and Global Partnership. I would like to invite you to Japan to continue the annual summit meetings between the Prime Ministers of Japan and India.’

The pressure to pursue a strong geo-economic diplomacy on both India and Japan had never been so important than as it is now not only on the economic front, but also to protect the geographical integrity of both the countries. The lately aggressive Chinese posturing in the Pacific and south China seas has sent alarm bells to Vietnam, the Philippines and Japan, the last two being island nations. The souring of Sino-Japan relations over the Chinese ownership claims of the Japanese controlled Senkaku and Diaoyu islands and indirect Chinese resistance to Japanese trade and investment in China have made the communist country a far less reliable economic partner for Japan. China has also been expanding its civil and military presence in India’s neighbourhood encompassing Pakistan, Sri Lanka, Nepal, Bangladesh and Myanmar. Its claims over parts of Indian territory in the northern and north-eastern parts of the country and the issue of staple visa to Indian visitors from these parts to China have caused nagging diplomatic irritation and major geographical integrity concerns on India’s part.

Ironically, Japan signed the first Comprehensive Economic Partnership Agreement (CEPA) with India in 2011, the year it surrendered the ‘world’s second largest economy’ tag to China. Unfortunately, CEPA failed to yield quick results for both India and Japan owing to policy inaction during the Congress-led UPA government. Under CEPA, tariffs on more than 8000 products, including apparel, agricultural products and machinery, were slashed. The deal also covered services, labour and investments fields. During its first year of operation, India’s exports went up by 24 per cent and imports by 40 per cent more from Japan. The targeted trade volume for 2014 is US$25 billion as against US$18.3 billion in 2013. India is yet to realise the full benefits of the deal that will accrue once Japan eliminates tariffs on 97 per cent of the items under the agreement over a period of 10 years. India’s shopping list is topped up with civil nuclear and Japanese military products.

Modi, who had built good relations with several top Japanese conglomerates during his long tenure as Gujarat’s chief minister, is confident to secure full support from Abe and Japanese business community to fulfill his economic dreams. Abe’s clear vision of India which he expressed during his 2007 trip will act as a big booster to Japan’s closer cooperation with India. Abe had, then, said the Pacific and the Indian Oceans are now bringing about a dynamic coupling as ‘seas of freedom and of prosperity.’ A ‘broader Asia that broke away geographical boundaries is 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.’ Modi is confident that the two countries can sincerely work towards a meaningful economic convergence for mutual benefit. Together, India and Japan are capable of building a formidable economic front.
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