Thursday, November 4, 2010

As India pushes east, so China worries ....

Here's the link to a story on Prime Minister Manmohan Singh's Japan visit by Peter Brown. The story, quoting me, is appearing in tomorrow's Asia Times.

Indian Prime Minister Manmohan Singh's trip to Japan in late October was a success, but not a complete success. Thanks to Japan's fundamentally pacifist worldview and rigid take on nuclear cooperation, the outcome was somewhat underwhelming.

For the full story, click here.

As India pushes east, so China worries
By Peter J Brown

Indian Prime Minister Manmohan Singh's trip to Japan in late October was a success, but not a complete success. Thanks to Japan's fundamentally pacifist worldview and rigid take on nuclear cooperation, the outcome was somewhat underwhelming.

Real damage might have been done if Manmohan and Japanese Prime Minister Naoto Kan had decided to forego an annual summit they have held since 2005, rather than announce a comprehensive Economic Partnership Agreement (EPA) after making little headway in firming up strategic and civil nuclear cooperation issues during the annual cycle of discussions between the two countries.

"With a Strategic Partnership being declared - in 2006 - a Joint Declaration on Security Cooperation being issued, and an Action Plan related to the Joint Declaration thereafter being issued almost in successive years, expecting another deliverable of the magnitude of the previous ones to be pulled out of the hat - or turban - again this year is tantamount to placing an overly high threshold of expectation," said Sourabh Gupta, senior research associate at Samuels International Associates in Washington, DC.

Expectations matter, but above all else, this trip and its limited agenda might have been a strong indicator of the nature of a rapidly maturing relationship. There could be little doubt that, regardless of what other positive moves the meeting held for the bilateral relationship, the participants were pleased by the fact that approximately one quarter of the allotted time was devoted to the topic of how best to deal with China.

"Most of all, India wanted further Japanese foreign direct investment especially in infrastructure, and technological assistance on nuclear power plants, along with [some sign that they were] reaffirming their mistrust against China," said Yukie Yoshikawa, a senior research fellow at the Edwin O Reischauer Center for East Asian Studies in Washington DC.

In response to Japanese concerns that it has been slower than other countries to capitalize on the opportunities that India's rapidly growing economy presents, India was quite willing to make important concessions in the process.

"Japan fears it is already a late comer into the Indian market. Japan has been slow in signing a free-trade agreement with India, and some companies already investing in India, including Suzuki, were dying to have the EPA approved," said Yoshikawa. "The [Japanese government] should be very pleased by India's strategic decision to of drop agricultural products for Japan. India compromised with Japan to exclude rice, and wheat [as well as other products] from the EPA."

To Professor Kazuto Suzuki of Hokkaido University's School of Public Policy, the summit provided a positive reflection of the steady overall improvement in ties between the two nations.

"It was good meeting and there was a good advancement of the relationship - not the best though," Suzuki said.

Beijing was watching the proceedings closely because if both the establishment of an EPA and the conclusion of nuclear deal had taken place during Manmohan's visit, the impact on China would have been substantial. Especially so given that the heated showdown between Japan and China over the fishing boat seizure near disputed islands claimed by Japan, China and Taiwan is still simmering.

"From a Chinese point of view, these strengthening ties between Japan and India represent nothing less than an effort to contain China - something that has yet to be accomplished completely," said Suzuki, who added that the initiation of institutionalized military and security cooperation between India and Japan that has been underway since 2008 means that Japan and India have formed "a semi-alliance" which is reinforced "by regular 2+2 meetings and military cooperation at all levels".

Gupta poured some cold water on the notion that this series of bilateral discussions is gaining momentum at a rapid enough pace and in such a way that might cause Beijing to think seriously about taking decisive moves to counter this trend.

"Going forward, there might be grounds for creeping doubt as to how fast this bilateral relationship will proceed under the Democratic Party of Japan (DPJ). Liberal Democratic Party (LDP) PMs, [former Japanese prime minister Yoshiro] Mori and [his successors], had been the decisive driving force behind Japan's new outreach to India - and each LDP PM's degree of emphasis on Indo-Japanese ties bore a relative correlation with his anti-China [or pro-China] inclinations. That dynamic is not readily apparent in the DPJ," said Gupta.

It is possible that the DPJ contains an invisible dividing line which seems generational when it comes to Japan's relations with India.
"The older generation including [former premier Yukio] Hatoyama, [former DPJ leader Ichiro] Ozawa particularly, and Kan - privately perhaps too - who take a more autonomist view of Japanese geopolitical strategy, had a place for India," said Gupta. "The younger generation including [Foreign Minister Seiji] Maehara .... [DPJ deputy secretary general Yukio] Edano .... even as they hold hawkish views on China, developed their worldviews at a time when India's image was at its poorest during the late 1970s to the early 1990s. Hence they are not altogether sold on the India strategic connection."

This younger group certainly does not dismiss its importance, but simply prefers to place more emphasis on building Japan's strategic ties with allies positioned closer to Japan.

"India is beneath the radar in their scheme of things. But this is all very tentative and preliminary, and time will tell how this dynamic within the DPJ plays out in terms of India-Japan relations in the coming years," said Gupta.

How India goes about cultivating its vital relationship with the 10 countries in the Association of Southeast Asian Nations (ASEAN) will also affect its relationship with Japan.

"India's most common refrain on Asian security architecture issues is that it be 'open, balanced and inclusive'. For it to turn out to be such, India's obligation is to participate within its processes, engage actively with all stakeholders, carry its share of the burden, and not be an irritant in the mix,'' said Gupta, ''ASEAN is a key shareholder in this dynamic and for India, a gateway too to its East Asian destiny - hence the low key but utterly concentrated effort on New Delhi's part to get this relationship right."

Gupta described the signing of the ASEAN-India Free Trade Agreement last year as "a big deal", and the same is true of New Delhi's decision to invite President Susilo Bambang Yudhoyono of Indonesia, Southeast Asia's biggest economy, to be the honored guest at India's forthcoming annual Republic Day parade.

As part of its Look East policy, India sees these relationships as an important bridge to East Asia. ''A more robust economic engagement with Malaysia, ASEAN and Japan will provide strategic ballast down the line," said Gupta.

South Korea will certainly play an important role here and both Japan and India agree that better coordination is in order. They also zeroed in on what to do about Japanese allegations (denied by Beijing) that China is holding back on exports of the rare earth minerals that are a crucial ingredient for their hi-tech industries.

"It was significant that the two PM's mentioned an India-Japan dialog on Africa on foreign policy and security issues. We all know what has prompted such a dialog. Rare earths supply problems were also discussed along with potential cooperation in developing technologies to mitigate the problem," said Subrata Ghoshroy, a research associate at the Massachusetts Institute of Technology's Program in Science, Technology, and Society.

However, China has nothing whatsoever to do with the chronic differences affecting Tokyo and New Delhi on the nuclear front, where India and the United Stated last year pledged closer civilian nuclear cooperation.

"Japan was not enthusiastic about the US-India nuclear deal and gave it grudging support toward the end. Japan is also concerned about the status of the Comprehensive Test Ban Treaty (CTBT) as can be surmised from the joint vision statement issued during the Indian PM's visit," said Ghoshroy. "Singh did not directly mention India's stance on the CTBT and reiterated India's 'unilateral moratorium' on nuclear testing."

In the end, the only thing really holding up completion of the nuclear deal was the nuclear test clause.

"If an Indian test yields a nuclear explosion, then Japan would halt all cooperation with India," said Suzuki. "PM Singh did not commit to a halt in nuclear testing, but he mentioned that there will be no planned test for a moment. This is good enough for Japan."

Regarding the India-Japan nuclear cooperation agreement, it appears that there are still outstanding issues.

"It is interesting to note that India has speedily concluded a nuclear agreement with South Korea, while the Japan deal is on a sticky wicket," said Ghoshroy. "Unlike South Korea, France, or Russia with which India has easily concluded such deals, Japan does not sell reactors. It does not have an overwhelming economic driver behind the nuclear trade."

India cannot be pleased that Japan has been so slow to come aboard as a willing supporter of its nuclear program.

"There have been three rounds of negotiations and while there is appreciation of the Japanese concerns - Japan being the only victim of nuclear weapons - India has made it clear that it cannot become party to Nuclear Non-Proliferation Treaty as a non-nuclear weapon state," said Rajeswari Rajagopalan, senior fellow in security studies at the Observer Research Foundation in New Delhi. "There has been a slightly modified position on CTBT wherein the prime minister has stated India will consider signing the treaty provided the US and China ratify it. It appears that it will take several rounds of negotiations before the two sides can reach any compromise on this issue."

On the issue of nullifying the agreement if India carries out a nuclear test, New Delhi is not willing to make an exception in its terms and references for Japan alone.

"India has insisted that India will use the same terms and references as it did in its agreements with other countries - US, Russia, France and Canada," said Rajagopalan.

The national security dimension of this situation may not get overlooked entirely, but it is often downplayed by observers.

"The national security dimension will remain critical in India's negotiations not just with Washington, but with other capitals as well - Tokyo, Canberra, Paris or Moscow. It is indeed this national security dimension that has restrained India from accepting the conditions imposed by Tokyo," said Rajagopalan.

While these stubborn nuclear obstacles persist, there are strong imperatives for both India and Japan to cooperate not just economic and commercial issues, but more importantly on security issues, particularly those in the maritime realm, given the challenges that both New Delhi and Tokyo are facing.

"The Look East policy is an important component of India's foreign policy which is likely to acquire special significance in the coming years. Given the belligerent approach of China towards all of its neighbors including Japan, and Vietnam, India is likely to pursue the Look East policy with much more vigor to consolidate its ties with both Southeast Asian and Northeast Asian countries," said Rajagopalan.

The very fact that both India and Japan have kept up with the annual summit meetings is a testimony to the importance that each side attaches to the bilateral relationship despite the change in Japanese leadership along with the change in ruling parties.

"The inability to conclude the civil nuclear agreement may be a shortcoming, although these are issues that cannot be hammered out in one or two meetings. The fact that the two sides are still keen to continue negotiations to iron out their differences is a positive indicator," said Rajagopalan.

As Manmohan departed Tokyo and flew onto Malaysia and Vietnam, he could not have ignored Kan's declining approval ratings just as he cannot overlook or ignore the changing political winds which are now affecting United States President Barack Obama as Obama is about to show up on his doorstep.

In the case of Kan in particular, the situation surrounding Russia's activities on the islands due north of Japan was a topic that Manmohan would have avoided despite the fact that Russia and India are longtime partners.

Russia ignored Japan's protests much to Kan's displeasure. This did not help Kan's ratings at all.

And Kan cannot offer to sell India any Japanese weaponry, including submarines and electronic warfare gear, until the strict ban on the export of Japanese weapons is lifted. Besides, India and Russia are jointly building state-of-the-art missiles and new warplanes are appearing on the drawing board, while US defense contractors are eager to see their advanced aircraft parked aside India's runways. Perhaps painfully slow nuclear bargaining may be Kan's only option, hypothetically anyway.

While Kan and Obama have exerted their influence over India's future, Kan is not guaranteed at least two more years in office like Obama. And at the same time, Obama who has made a big deal out of his administration's endorsement of closer US ties to Asia and who has applied considerable energy to improved relations with India is no longer guaranteed a vote of confidence, nor is it a blank check from the US Congress.

And important members of his team including US Secretary of Defense Robert Gates who has held the line on US bases in Okinawa will soon be heading out the door. Some have already left.

As anti-Chinese sentiment in the halls of the US Congress is likely to intensify, and as it becomes more noticeable in the coming weeks, the challenge for Manmohan will be to harness this energy to India's and Japan's advantage - and at Pakistan's expense. Not doing so during Obama's upcoming state visit to India will simply be a matter of common sense and diplomatic courtesy.

That is, after all, a strategic plan that is sound and applicable only if Manmohan has concluded that stronger ties to the US under the current rules will benefit rather than hinder India over time.

Manmohan will soon sort this all out. In the meantime, he is signaling to China that Look East is alive and well.

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