India’s Southeast Asia Pivot, Third Time’s a Charm?
Celebrating the silver jubilee of ASEAN-India relations, Prime Minister Narendra Modi penned an op-ed stating that the relations between India and the regional grouping is “free from contests and claims”, and that both share a common vision for the future that is built on “belief in sovereign equality of all nations irrespective of size”.
The opinion piece, published by 27 newspapers as 10 ASEAN leaders descended for a summit in Delhi on Friday, is a clear criticism of China’s growing hegemony and assertiveness in Southeast Asia as well as a statement of conviction to India’s desire to become a balancing power amid the perception of US decline and withdrawal under Donald Trump.
India’s pivot to Southeast Asia is, of course, not new. It began with India’s Look East Policy that lasted from 1991 until 2002. The primary push was to bring economic relations with Southeast Asia’s so-called “rising tigers” to new heights. This did not go well as major economies in the region fell into a deep recession following the 1997-1998 monetary crises.
The second phase of the Look East Policy had India diverting its attention elsewhere. Then Prime Minister Manmohan Singh broadened the scope of the policy by including China, Japan, South Korea, Australia and New Zealand. The outcome was a mixed bag as it was eclipsed by the rise of BRIC as a formidable economic club of emerging economies, which includes India. By November 2015, Goldman Sachs closed down its BRIC investment fund as the economies suffered from falling global demand and lower commodity prices. In the following year everyone seemed to be convinced that the BRIC bubble had burst.
Enter the third phase. Once again, India is looking to bolstering relations with Southeast Asian nations, this time by offering a new outlook, calling it “Act East Policy”. On top of the usual agenda of strengthening trade and investment, this new approach presents India as a potential security balancer to China amid rising tensions in the South China Sea. India has so far secured defense cooperation with Myanmar, India and Vietnam to jointly patrol the Malacca Straits.
Given the security dynamics in the region, there is definitely a role for India to play. However, it is still questionable that India will live up to its newly-found geostrategic ambitions. A look into India’s recent economic engagements with Southeast Asian countries, particularly those on infrastructure, is not comforting.
There has been lack of progress in the construction of India-Myanmar-Thailand Trilateral Highway as well as the Kaladan Multi-Modal Transit Project, resulting in negative perceptions on India’s capacity to deliver on its commitments. Secondly, the annual value of foreign investment coming from India to ASEAN countries has generally been on a downward trajectory since 2013. Meanwhile, China’s investments to the region endured, totaling at $37 billion from 2012 to 2016 versus India’s $12 billion. Last but not least, trade relations also disappoint. ASEAN’s total trade value reached $58 billion in 2016 with India, down by 21.7 per cent compared to five years before, versus $368 billion with China, an increase of 24.8 per cent.
Of course, a relationship is a two way street, but ASEAN is equally an unreliable partner. A student of history knows that ASEAN countries have never been able to escape the patron-client system, a reality that has persisted since the Cold War era. The only thing that has changed is the face of the masters. More worryingly, as these countries continue to struggle for autonomy, their efforts are currently being undermined by domestic political instabilities, which in the case of Cambodia, Philippines, Thailand and Vietnam have led to the rise of authoritarianism. Opposition leaders have been sacked, journalists gagged and human rights trampled upon. Democracy is slowly being decimated in these countries, bringing them closer to China.
All these factors further highlight the need for a rebalancing power in Southeast Asia. Sadly, India is not up for the task. At least for now.