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India must shift focus to Southeast Asia : The Tribune India


Anita Inder Singh


Founding Professor, Center for Peace and Conflict Resolution

On December 1st, India will replace Indonesia as the G20 presidency. Current global economic difficulties, the Ukraine war, and political polarization between the West and Russia are causing international instability. India must be prepared to take on many challenges while balancing on a political tightrope.

India should pay more attention to the wider Indo-Pacific environment. Most Indo-Pacific countries are among the fastest growing economies in the world. Their progress has shaped the global economic environment and India needs to strengthen its economic ties with them. This can only be achieved by tackling the knots that complicate the inevitable relationship between economy and security.

At the moment, India is an awkward mix of strategic volatility, strong trade ties and burgeoning trade deficits with China, Asia’s main territorial spoiler and major economic powerhouse. As her G20 presidency, India is expected to be challenged by China as leader of the Global South. At his G20 meeting in Bali recently, President Xi Jinping quickly bolstered China’s claim to international economic leadership, arguing that China’s modernization would bring more opportunities to the world, especially the Asia-Pacific region. claimed.

India’s Act East policy, outlined in 2014, reflects India’s desire to shape the geopolitics of the Indo-Pacific. It has joined the Quadrilateral Security Dialogue, a loose deal involving Australia, Japan and the United States, to expand trade with ASEAN. Strategy and economics are linked. India considers the fact that the Indo-Pacific countries account for more than 60% of her GDP in the world and about 50% of world trade passes through this region, making its strategic and geo-economic Importance must be emphasized. Moreover, the Sino-American conflict over the global order cuts across the security and economic interests of the island and coastal states of the Indo-Pacific.

However, China is the largest trading partner for many countries and a major investor in the Indo-Pacific region. Japan and the EU have invested more in Southeast Asian countries that want to diversify their economies, despite the US-China rivalry. Nevertheless, China accounts for her 15% of world trade and India for her 2%. In 2021, China-ASEAN trade will reach her $878 billion. The trade volume between ASEAN and India reached about $78 billion. China’s Export-Import Bank, which is responsible for facilitating China’s foreign trade, has also launched $27.7 billion in credit support for her imports from countries that are members of the Regional Comprehensive Economic Partnership (RCEP). In 2019, India decided not to join RCEP, mainly for fear that her RCEP would be dominated by China.

For two reasons, India needs to strengthen its trade and investment ties with Southeast Asia if it wants to strengthen its overall position in the Indo-Pacific. First, most countries in the region and China are economically more advanced than India and trade relatively little with India compared to China, the EU and the United States. We know that the United States, the strongest economy, is the main economic and geopolitical opponent to China’s influence in the Indo-Pacific. Their interests are aligned with those of the United States to maintain its role as regional norm-setter. That’s why they welcome Washington’s new Indo-Pacific Economic Framework (IPEF). The IPEF provides them with America’s competitive know-how in areas such as the digital economy, supply chain resilience, and green infrastructure.

As a quad member that refused to join the IPEF’s trade pillar (three years after deciding not to join the RCEP), India finds that its strategic goals and international economic relations do not complement each other. I am making it clear. India supports her IPEF on her supply chain, tax, anti-corruption and clean energy. However, it is unlikely that it will be able to integrate into regional and global supply chains without becoming part of the Indo-Pacific trade pillar. I haven’t been able to.

This is in contrast to China and the United States. China knows that the rise of its military power is linked to its progress and integration into the global economy. That is why I am concerned that economic relations with Western countries must not remain immune to sanctions against Russia for its invasion of Ukraine.

On another level, Washington’s latest National Security Strategy says that in an interconnected world, if America is to succeed abroad, it must invest in innovation and industrial strength and build resilience at home. I am confirming that there is

India’s opting out of Asian trade deals will only pave the way for China to dominate Asia economically. The surge in Sino-Indian trade and India’s rising trade deficit with China since the 2020 border dispute could be exploited by Beijing for related political and economic reasons. Similarly, our comprehensive strategic partner, Russia, also hates quads. As an instrument of US imperialism, she uses energy ties as her Sword of Damocles against the EU.

On the other side, India’s business environment discourages investment. In general, many US companies leaving China are not strongly attracted to India. Due to lower costs and fewer regulatory constraints, Vietnam is the preferred alternative to China, followed by Indonesia. New Delhi needs to welcome more Asian and Western investment to compete with China.

New Delhi’s decision to sidestep RCEP and IPEF may miss an opportunity for India to make a presence in the region. By stalling or ignoring the enduring links between geoeconomics and geopolitics, and by not participating in her two key Indo-Pacific trade agreements, India has become economically isolated and threatens the security of the Indo-Pacific. There is a danger that the contribution to It also suggests that China will use her G20 (and East Asia) meetings to promote common development and security in the region through its Global Development and Security Initiative, RCEP, and its version of multilateralism. We’re getting more regional support at the expense of America when it’s meant to be.

New Delhi is often the hurdle that prevents India from improving its regional status. India needs to develop and implement policies that lead to more progress, connect geopolitical and geoeconomic goals, and help it gain influence in its wider neighborhood, the Indo-Pacific. It will be a powerful her G20 Presidency.

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