INDIA - JAPAN RELATIONS – INTERNATIONAL
News: Need to take a common stand on maintaining international order, says Japanese PM
What's in the news?
● Russia’s war in Ukraine “obliges” Japan and India to take a common stand on the importance of maintaining the international order, said visiting Japanese Prime Minister Fumio Kishida.
● Mr. Kishida’s remarks were significant as they came the same day Chinese President Xi Jinping landed in Moscow to discuss the Ukraine conflict with Russian President Vladimir Putin.
Key takeaways:
● India and Japan discussed coordinating the agendas of the G-7, to be held in Hiroshima in May and the G-20 to be held in Delhi in September on a number of issues including debt financing, food and energy security.
● Prime Minister Narendra Modi accepted Mr. Kishida’s request to be one of the special invitees to the G-7 summit of the world’s seven most developed countries on May 19-21.
○ The other special invitees are the leaders of Brazil, Indonesia, Australia, South Korea, Vietnam, the Cook Islands and Comoros.
● PM Modi said that "giving voice to the priorities of the Global South is an important pillar of our G-20 Presidency”.
Japanese PM on Ukraine issue:
● PM Kishida is clear that "today’s Ukraine could be tomorrow’s Asia,” indicating Japan’s concerns over China’s actions in the Senkaku Islands, South China Sea and Taiwan Straits.”
● Mr. Shikata said the issue of “shared responsibilities” on the rule of law between India and Japan was discussed by the two leaders during bilateral talks as well as a working lunch that followed.
● PM Kishida also said that “Russia’s aggression against Ukraine obliges us to face the most fundamental challenge; defending peace". Hence, it was necessary for countries to build a common perspective on what international order should be.
● Mr. Kishida said, indicating countries like India, that have not criticized Russia’s actions openly. Mr. Kishida praised Mr. Modi’s statement from September 2022 that “this era is not of war”, and officials said Japan is hopeful that India would be more “forthcoming” during the upcoming G-7 summit, which would see a number of documents calling for Russia to end the war in Ukraine.
India - Japan bilateral relationship:
● The friendship between India and Japan has a long history rooted in spiritual affinity and strong cultural and civilizational ties. Indian culture, filtered through Buddhism, has had a great impact on Japanese culture, and this is the source of the Japanese people's sense of closeness to India.
● Bilateral ties have been singularly free of any kind of dispute – ideological or territorial. India - Japan peace treaty was one of the first peace treaties Japan signed after World War II.
● “The India-Japan Special Strategic and Global Partnership is based on our shared democratic values, and respect for the rule of law in the international arena.”
1. Political Relations:
● Regular high-level visits and engagements between India-Japan have taken place at G20 Summit held in Osaka, G7 Summit in Biarritz in August 2019, and Eastern Economic Forum in Vladivostok on 5 September 2019.
● In the meeting in Vladivostok, India-Japan decided to hold the first 2+2 Ministerial Meeting at an early date.
● 2+2 Mechanism:
a. Japan is the second country with which India has 2+2 ministerial dialogue (USA being the other one)
b. India and Australia also have the 2+2 at the official level.
c. With this, India has 2+2 mechanisms with all the Quad countries at some level.
d. The ministerial level meeting was held after a decision to institute a Foreign and Defence Ministerial Dialogue was taken during the 13th India-Japan Annual Summit held in Japan in 2018.
e. India has 2+2 dialogues with four key strategic partners: the US, Australia, Japan, and Russia.
● MoU on Japanese language education for the MEA.
2. Defence ties:
● India and Japan held their first bilateral exercises, ‘Dharma Guardian And ‘Shinyuu Maitri’, in 2018. It was held between the Armies and Air Forces of both the countries.
● Japan participates in the annual India-US Malabar naval exercises on a regular basis.
● Japan also joined the India-US Air Force exercise ‘Cope India As an observer for the first time.
● Acquisition and Cross-Servicing Agreement (ACSA):
○ Negotiations are going on for the agreement through which Japan could gain access to Indian facilities in the Andaman and Nicobar Islands and India could have access to Japan’s naval facility in Djibouti.
● MILAN 2022 witnessed the first-ever participation by not just Japan but all the Quad nations, as well as France and South Korea.
● Reciprocal Provision for Supply and Services (RPSS) - Under this agreement both countries ships and defence vehicles can use each other's naval facilities.
3. Trade Relations:
● Japan's interest in India is increasing due to a variety of reasons including India's large and growing market and its resources, especially the human resources.
● The India-Japan Comprehensive Economic Partnership Agreement (CEPA) that came into force in August 2011 is the most comprehensive of all such agreements concluded by India.
● India was the 18th largest trading partner for Japan, and Japan was the 12th largest trading partner for India in 2022.
● India’s primary exports to Japan have been:
○ Petroleum products, chemicals, elements, compounds, non-metallic mineral ware, fish & fish preparations, metalliferous ores & scrap, clothing & accessories, iron & steel products, textile yarn, fabrics and machinery etc.
● India’s primary imports from Japan are:
○ Machinery, electrical machinery, iron and steel products, plastic materials, non-ferrous metals, parts of motor vehicles, organic chemicals, manufacturers of metals, etc.
● Supply Chain Resilience Initiative (SCRI): Launched by India, Japan, and Australia to counter China’s dominance of the supply chain in the Indo-Pacific region.
4. Investment Relations:
● Direct investment from Japan to India has increased, and Japan was the 4th largest investor for India in FY2021.
● India and Japan have set an investment target of “five trillion yen” ($42 billion) in the next five years.
○ Japan aims to coordinate with India for projects as a part of a “Bay of Bengal-Northeast India industrial value chain” concept.
● Japan already has invested in the $90 billion Delhi-Mumbai Industrial Corridor.
● Japanese FDI into India has mainly been in the automobile, electrical equipment, telecommunications, and chemical and pharmaceutical sectors. Eg. Suzuki.
● Japanese companies have established ten Japan-India Institute of Manufacturing (JIM) in India.
● Cooperation in Railway Sector Mumbai-Ahmedabad High-Speed Railway (MAHSR). The ambitious project is being implemented with nearly 90% financial support and technology from Japan.
○ Recently, th financing of the next (IVth) tranche of Japanese funding for a loan of 300 billion Yen for the Mumbai-Ahmedabad High Speed Rail (MAHSR) or “Bullet Train” project was signed between India and Japan.
● The two countries have agreed to a Bilateral Swap Arrangement that would allow their central banks to exchange local currencies for up to $75 billion. This is substantially more than the $30 billion currency swap arrangement announced between China and Japan.
● Japan is the third-largest source of FDI ($28.160 billion between 2000 and June 2018) investment into India after Mauritius and Singapore.
● Japanese companies have signed an agreement to introduce Johkasou technology for decentralized wastewater treatment in India. It is utilized in areas where sewage infrastructure has not yet been developed.
5. Digital partnership:
● In view of synergies and complementarities between the two nations, “India-Japan Digital Partnership” (I-JDP) was launched during the visit of PM Modi to Japan in October 2018 furthering existing areas of cooperation as well as new initiatives within the scope of cooperation in S&T/ICT, focusing more on “Digital ICT Technologies”.
● Four Japanese investors - Mizuho Bank, Development Bank of Japan, Nippon Life and Suzuki have already signed letters of intent.
● The fund aims to invest in more than 200 Indian companies focused on emerging areas such as Internet of Things (IoT), Artificial Intelligence (AI), Machine Learning (ML), fin-tech, healthcare, consumer, education, robotics, automation and business-to-business (B2B) software.
● Recent initiatives include the establishment of three India-Japan Joint Laboratories in the area of ICT (AI, IoT and Big Data); Initiation of the DST-JSPS Fellowship Programme for young researchers.
6. Space Relations:
● The Japan-India Space Dialogue was announced by the Prime Minister and Japanese Prime Minister in October in 2018 at the end of the annual summit of both countries.
● Focus area: Surveillance and Maritime Domain Awareness (MDA) of the waters in the East China Sea, the South China Sea and the Indian Ocean will likely remain focus areas in the bilateral space collaboration.
7. Maritime Awareness:
● QUAD:
○ It is also known as Quadrilateral Security Dialogue (QSD).
○ Japanese PM Shinzo Abe mooted the idea of Quadrilateral Security Dialogue in 2007.
○ QUAD is an informal group of India, the US, Japan and Australia.
○ It is a strategic dialogue with the objective to ensure a free, open, inclusive and prosperous Indo Pacific.
○ The two Prime Ministers emphasized the importance of bilateral and plurilateral partnerships among like-minded countries in the areas such as the QUAD grouping of India, Australia, Japan, and the United States.
○ The Japanese Prime Minister invited PM Modi to Tokyo for the QUAD Summit Meeting.
● Indo - Pacific Oceans Initiative was announced by India in 2019.
○ India appreciated Japan’s participation as a lead partner on the connectivity pillar of IPOI.
○ They reiterated their strong support for ASEAN’s unity and centrality and their full support for the “ASEAN Outlook on the Indo-Pacific (AOIP)” which upholds the principles such as the rule of law, openness, freedom, transparency, and inclusiveness.
○ Japan reiterated that India is indispensable for peace and stability in the Indo-Pacific and no country should use force or coercion in trying to drive their territorial claims.
8. Healthcare:
● India’s AYUSHMAN Bharat Programme and Japan’s ASHWIN, both sides had been consulting with each other to identify projects to build the narrative of AHWIN for AYUSHMAN Bharat.
9. Energy:
● The two sides have launched an Energy Dialogue to promote cooperation in the energy sector in a comprehensive manner.
● In 2015, India and Japan reached a substantive Agreement on Cooperation in the Peaceful Uses of Nuclear Energy. India becomes the first non NPT signed country to do so.
10. UN Security Council:
● India and Japan also are tenting for a seat withinside the United Nations Security Council as Permanent Members. Both the international locations are robust advocates of reforms withinside the UN and its associate institutions.
Significance of Japan for India:
1. Investment:
● New Delhi is seeking massive investments in its infrastructure sector and Japan is a major investor.
● Japan’s technological and economic prowess could accelerate India’s development by transforming its infrastructure and manufacturing sectors.
2. Counter China:
● The rise of China has been an important factor, while India’s growing closeness with the US has also played a role, as the US and Japan already have a close alliance.
3. Uphold the Democracy:
● Both India and Japan also share several common ideals like democracy, the rule of law, and human rights, in addition to the complementarities that bind their economies.
4. Indo-Pacific and Quad:
● Sharing convergent interests, both countries are strongly committed to freedom of navigation and over flights and unimpeded commerce in the open sea which is important for the stability and security of the Indo-Pacific region.
5. Infrastructure cooperation in other foreign countries:
● India and Japan also formed the Act East Forum and are engaged in projects in the Northeast, closely watched by China.
● The two countries also planned joint projects in Maldives and Sri Lanka among others to counter Beijing’s influence.
Challenges in India - Japan Relations:
1. Hindrances in trade/ Investment relations:
● Though India and Japan have come a long way in their economic cooperation, that still is a penny when compared to the China-Japan economic ties.
● Compared to the US$ 300 billion trade with China, India-Japan trade still languishes at mere US$15 billion.
● Japanese investors lament lack of clarity in the policy guidelines, labor laws, tax laws, legal and regulatory framework.
● For Japanese corporations some other inhibiting factors are differences in business practices, environment and culture etc.
2. Limited Defense cooperation:
● India and Japan defense relations after multiple defense exercises and agreements are primarily focused and revolve around China.
● Japan does not give major importance to India when it comes to Indo-China border issues or Indo-Pak border conflicts.
● There is hardly any exchange or procurement of defense equipment or technology from Japan.
3. Balancing between Quad and :
● India is a member of groups like the BRICS, which brings together Brazil, Russia, India, China, and South Africa.
● In addition, though New Delhi has not joined the China-led Belt and Road Initiative (BRI), it is a member of the AIIB (Asian Infrastructure Investment Bank).So India has to do a balancing act between Quad and Brics.
● India has long adopted a non-aligned approach as opposed to the stauncher, pro-US foreign policy stances of Japan and Australia.
● The failure of these nations to come up with a joint statement points to an inherent struggle to reconcile their competing views on how best to counter the rise of China.
4. Asia-Africa Growth Corridor (AAGC) project:
● There is a great deal of scepticism on the feasibility of the AAGC itself as well as the nature of the projects embedded in it.
WAY FORWARD:
1. Curbing the Hegemony in India-Pacific: India and Japan are required to transform their military strategy and build on the common interest in preventing the rise of a securing hegemony in the Indo-Pacific (US and China).
2. Knowledge Exchange for Disaster Risk Reduction: India can benefit from Japan's disaster management experience in developing disaster risk reduction policies and measures in disaster-prone areas.
3. Pollution reduction: Pollution is a serious issue in major Indian cities. Japanese green technologies can help India tackle this threat.
4. Indo-Japan should be realistic enough to understand that in any future regional strategic scenario, because of its economic and military strength, China will figure quite prominently so efforts should be made to keep the Indo-Pacific multipolar.
5. Improvement in defence industrial cooperation:
● The missing link is the lack of cooperation in military industrial cooperation. Japan is still mulling if the government could allow the exports of military equipment to other countries, including India.
● Recently, Japan and India held the first India-Japan Defence Industry Dialogue, to talk about the cooperation and collaborating for military equipment
6. Trade Improvement:
● India Japan bilateral trade value is only $19 billion dollar but Japan China bilateral trade value is around $110 billion dollar. So both countries should work towards the development of bilateral trade.
● India, Japan and Australia have established Supply chain network initiatives for the smooth and uninterrupted supply chain in the region.