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The New India-US Partnership in the Indo-Pacific: Peace, Prosperity and Security

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The New India-US Partnership
in the Indo-Pacific: Peace,
Prosperity and Security
Abhijit Singh Aparna Pande Jeff M. Smith
Samir Saran Sunjoy Joshi Walter Lohman
The New India-US Partnership
in the Indo-Pacific: Peace,
Prosperity and Security
Abhijit Singh
Aparna Pande
Samir Saran
Sunjoy Joshi
Walter Lohman
Jeff M. Smith
© 2018 Observer Research Foundation.
All rights reserved. No part of this publication may be
reproduced or transmitted in any form or by any means without
permission in writing from ORF.
Cover photos:
Boeing C17 / Amir Ahadi/Wikimedia Commons/CC BY-SA 4.0;
Jawaharlal Nehru Port / A.Savin/Wikimedia Commons
ver the years, India earned the epithet of a reluctant power in
Asia – exuberant in its aspirations, yet guarded in its strategy.
OHowever, as the challenges in its immediate neighbourhood
and beyond continue to evolve, India is today gearing up to embrace a
larger role in the far wider theatre of the Indo-Pacific.
Forming the core of the ongoing global economic and strategic transitions
are a rising and assertive China, an eastward shifting economic locus, and
the faltering of Western-led multilateral institutions. These converge with
domestic development and national security objectives to demand that
India strive to expand its presence, reach, and voice both on land and in
the sea in its extended neighbourhood. Today, New Delhi is actively
seeking to create opportunities for mutual development in the Indo-
Pacific, in the Arabian Sea and in Africa even as it engages like-minded
nations in the pursuit and preservation of a rules-based order that
promotes transparency, respect for sovereignty and international law,
stability, and free and fair trade. In both these endeavours, the United
States is an appropriate and willing partner. As Indian Prime Minister
Narendra Modi stated in his address to the US Congress in 2016, “[a]
strong India-US partnership can anchor peace, prosperity, and stability
1
from Asia to Africa and from the Indian Ocean to the Pacific.”
The US has been a principal architect and the traditional guarantor of a
liberal economic and maritime order in the Indo-Pacific. While the
commentariat in the US and India might express apprehension at the idea
of US President Donald Trump’s ‘America First’ strategy, this moment
must be seen as an opportunity to rebalance the Indo-US relationship to
reflect a real convergence of strategic interests, as opposed to an abstract
engagement based on values alone and one that has disregarded the core
interests of both countries.
Even as the phrase ‘free and open Indo-Pacific’ replaces ‘Pivot to Asia’, it
is clear that the US will continue to play an important role in the region.
Executive Summary
1
The US is acutely aware that disengagement is not an option when the
contests of the region are, in fact, irrevocably moving both westwards and
eastwards, and ever closer to its own spheres of influence. Thus,
maintaining an influential presence and assets in the region effectively
responds to its agenda. The US continues to retain an unequivocally large
2
military presence in the Indo-Pacific. Moreover, Washington appears
intent on finding ways to address shortfalls in its defence budget. The
most recent defence bill specifically authorises the establishment of the
new Indo-Pacific Stability Initiative to increase US military presence and
enhance its readiness in the Western Pacific. As it remains an invested
actor across the Middle East and in Afghanistan, and as it confronts an
unrelenting North Korea, it must seek to empower regional like-minded
nations such as India, which it recognises as having an “indispensable role
3
in maintaining stability in the Indian Ocean region.”
US Secretary of State Rex Tillerson’s remarks at the Center for Strategic
and International Studies a few days before his visit to India in the fall of
2017 is a testament to the continuity of the relationship: “The increasing
convergence of US and Indian interests and values offers the Indo-Pacific
the best opportunity to defend the rules-based global system that has
4
benefited so much of humanity over the past several decades.” In a way,
the title of his speech, “Defining Our Relationship with India for the Next
Century”, should set the tone for the Indo-US relationship; and this new
direction must not be influenced even by changes in leadership in the two
capitals. It must first be imagined and then crafted as a multi–decade
relationship that engages with the disruptions that abound in a multipolar
world. This 21st century partnership must take into account each country’s
economic trajectory, political values and strategic posture. The Indo-
Pacific region will be the theatre in which this partnership will truly be
realised. Both President Trump and Prime Minister Modi seem cognizant
of this reality, and are intent on creating a new blueprint for this long-term
engagement.
The terms of this bi-lateral cannot be limited to maintaining the regional
balance of power. Rather, both countries, in concert with other like-
minded powers, have a stake in enabling and incubating a peaceful,
prosperous, and free Indo-Pacific. As these countries align in their desire
to see a new regional architecture emerge, the following present
themselves as the most crucial domains where a strengthened India-US
The New India-US Partnership in the Indo-Pacific: Peace, Prosperity and Security
2
relationship can have deep and influential impact in a region that matters
to the whole world:
1. Defence trade and technology
India’s designation as a ‘major defense partner’ of the US, and the
Defense Technology and Trade Initiative provide a bilateral platform for
defence trade and technology sharing with greater ambitions and at a
faster pace. The ‘Make in India’ initiative strengthens scope for co-
production and co-development. The new appetite for business reforms is
catalysing the largest volumes of foreign direct investment ever received
5
by the country.
As India undertakes broader defence transformation initiatives, US
defence companies can collaborate with New Delhi in its US$150-billion
military modernisation project. They can do this by jointly identifying the
gaps and working together to equip Indian forces in the short run. This
must be followed by cooperation on advanced technologies to help build
up the country’s defence manufacturing base in the longer term.
Continuous progress on these fronts will enhance Indian capabilities,
enable greater readiness of Indian forces, and level the playing field.
Specifically, priority military hardware, technologies and areas for joint
production need to be identified. Pending sales, such as that of the
Guardian RPVs, need to be expedited, along with the micro unmanned
aerial vehicle project. Further, the matter of quality and subsequent
liability of equipment made in India through joint Indian-US ventures
needs immediate attention. Additionally, the hesitation of US companies
in sharing proprietary and sensitive technology is a concern that will need
to be taken up on a case-by-case basis.
2. Maritime freedom and security
There is a rare moment of clarity in US and Indian policy circles on the
importance of each other in this region. This is important if the countries
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are to act as “anchor of stability” in the Indo-Pacific.
The New India-US Partnership in the Indo-Pacific: Peace, Prosperity and Security
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It is time to begin conversations on new arenas of military cooperation,
intelligence sharing, and strategic planning, to include advanced platforms
like fifth-generation fighters, nuclear submarines, and aircraft carriers.
Already, the two countries share a maritime security dialogue, which was
instituted in 2016, as well as working groups on aircraft carrier technology
and jet engine technology. They should be strengthened further and
complemented by new working groups.
The annual Malabar exercise, which now formally includes a third partner,
Japan, is another key feature of military cooperation, improving
coordination and interoperability. Adding to these efforts are the Logistics
Exchange Memorandum of Agreement, which will create maritime
logistic links, and a white shipping agreement which promotes regional
maritime domain awareness.
India-US maritime security cooperation is critical because it supports
efforts that prioritise joint stewardship for ensuring freedom of navigation
and unimpeded trade across a maritime common that is a major conduit
for commercial and energy supplies, and is rich in natural resources,
ecosystems, and biodiversity. Moreover, the Indian Ocean Region is
extremely vulnerable to extreme weather events that are likely to increase
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significantly in the coming years. To address these developments, the US
and India can cooperate to provide humanitarian assistance and disaster
relief missions in the region.
Further, the two sides are committed to resisting the aggression that China
has displayed in the South China Sea and elsewhere in the Indo-Pacific.
Indo-US cooperation in the Indo-Pacific must also serve to affirm the
principles of freedom of navigation and peaceful settlement of maritime
disputes.
An expanded bilateral maritime partnership that involves transfer of
technology to build India’s capacity in the Indian Ocean Region will help
create a more stable and balanced security architecture there. This same
partnership should explore new forms and formats of joint exercises and
naval drills, such as anti-submarine warfare and maritime domain
awareness missions, and encourage support for Indian leadership as “force
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for stability” in the IOR.
The New India-US Partnership in the Indo-Pacific: Peace, Prosperity and Security
4
3. Blue economy
India and the US must also collaborate to promote a market-driven blue
economy as a framework for growth and prosperity in the Indo-
Pacific—home to bountiful hydrocarbon, mineral, and food resources, as
well as burgeoning coastal populations.
India and the US can further elevate cooperation in marine research and
development to create common knowledge hubs and share best practices.
They can collaborate to develop mechanisms and foster norms that ensure
respect for international law. The US can support regional collaboration in
the Indo-Pacific to explore new and environmentally conscious investment
opportunities in maritime economic activities and industries, such as food
production and coastal tourism. Direct investments in Indian efforts, such
as in identified coastal economic zones and the Sagarmala initiative, and
participation in regional groupings like the Indian Ocean Rim Association,
are two ways in which it can do so.
Effectively, the US can support India in creating a resilient regional
architecture in the Indo-Pacific that places an emphasis on stability,
economic freedom, growth and maritime security.
4. Connectivity
Today, states in the Indo-Pacific are in dire need of funds and expertise to
improve infrastructure development and regional connectivity. Beijing has
introduced its own project—the Belt and Road Initiative—through which
it is investing in infrastructure initiatives across Eurasia and the Indo-
Pacific. While connectivity is undoubtedly the primary aim of the project,
it is increasingly clear that China seeks to expand its political and military
influence in the region under the aegis of the BRI. To prevent the
emergence of an Asian order inimical to the rules-based order, states must
work together to forge a more inclusive approach towards an emerging
regional architecture. This framework must be willing to accommodate
everyone, including China, in connectivity projects from Ankara to Saigon,
or the sea lanes seeking to link ASEAN with Africa.
The New India-US Partnership in the Indo-Pacific: Peace, Prosperity and Security
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For this to occur, pragmatic, democratic, and normative powers need to
first create a political narrative within which Asia’s connectivity will take
place. This narrative must underscore the importance of good
governance, transparency, rule of law, and respect for sovereignty and
territorial integrity. This can then be posited against strictly bi-lateral
projects such as the BRI, which burden participating countries with debt
and environmentally unsound projects. This alternative proposition to
China’s BRI can then become the blueprint for connectivity and
integration from Palo Alto to Taipei, Bengaluru to Nairobi, and Tel Aviv
to Addis Ababa. The possibilities are endless and straddle hard
infrastructure, digital connectivity, knowledge clusters, and value chains in
the Indo-Pacific space.
The India-US partnership has an important role to play in this respect.
The American vision of the Indo-Pacific Economic Corridor supplements
India’s Act East policy, and India-US cooperation in physical and soft
infrastructure can link cross-border transport corridors; help create
regional energy connections; and facilitate people-to-people interactions.
Further, India and the US can cooperate as “global partners”, with US
investment in Indian projects in Africa. Accordingly, the Asia-Africa
Growth Corridor proposed by Japan and India can provide a common
platform to all three states. Further, the US can nurture burgeoning
regional partnerships between Japan, South Korea, Australia, and India, as
these countries work towards building a consultative and collective Asian
framework.
5. Digital connectivity, trade, and technology
Digital connectivity merits particular attention. After all, in the next
decade, the largest cohort of internet users will emerge from the Indo-
Pacific region. China is working aggressively to ensure that digital
platforms in the region will be influenced by its own model for cyberspace
premised on sovereignty. A major part of China’s BRI is the new
“information silk road”, which facilitates investments by Chinese
companies in South Asia’s internet architecture.
Accordingly, the US and India must cooperate to ensure that digital
platforms, trade, connectivity and norms are shaped according to the
The New India-US Partnership in the Indo-Pacific: Peace, Prosperity and Security
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democratic and open nature of the internet. To do so, they must create a
framework that responds to developing-country imperatives such as
affordable access, local content generation and cybersecurity. Already,
Prime Minister Modi’s ‘Digital India’ programme provides a model for
other states in the region to use internet-enabled technology to spur
economic growth. India’s Aadhaar initiative, a unique digital identity
programme, has already generated significant interest amongst South
Asian states. American companies have increasingly sought to adopt
standards and technologies to leverage this platform and build new
markets in India. For example, WhatsApp has integrated with India’s
unified payments interface to provide digital payments. Examples of other
development initiatives are also abundant. Elsewhere, the Google RailTel
initiative aims to provide Wi-Fi at 400 railway stations across India by
2018.
India-US bilateral cooperation in using the digital as a tool for economic
development and empowerment can be the template to connect the three
billion emerging users in other developing countries in the Indo-Pacific
and across Africa. As digital norms are institutionalised — whether
pertinent to data flows and e-commerce, or related to critical
infrastructure, defence, and public services — there is a real opportunity
for India and the US to build and subsequently provide a model working
relationship for the digital economy. Effectively, the US and India can
propose a set of ‘Digital Norms for the Indo-Pacific’ that can be
operationalised under their various dialogues and mechanisms for
cooperation in the region.
The New India-US Partnership in the Indo-Pacific: Peace, Prosperity and Security
7
A CONVERGENCE
IN
GRAND STRATEGY
ndia’s rapid growth rate of around seven percent per year for the
last few years has already made it the world’s fastest expanding
Ieconomy. The average income in India has nearly doubled in the
past ten years, and economic modernisation promises to bring more jobs
and advanced industry. This economic trajectory has prompted greater
ambition in international politics, while creating a new set of security
concerns for New Delhi. Accordingly, the desire to play a larger role in
Asian and global affairs as well as a greater stake in international stability
have made New Delhi more amenable to partnerships in the Indo-Pacific
region.
While India’s rapid economic growth and strategic expansion is
impressive, it is a transformation that is occurring in the shadow of
China’s even more striking ascent. New Delhi is keenly aware that Beijing’s
expanding regional and global influence is upsetting Asia’s geopolitical
balance. In such an environment, engagement with the United States,
along with efforts to foster regional partnerships and cultivate domestic
military capabilities, have a key role to play if India is to shape a regional
architecture that respects international norms and laws.
The US has been the predominant maritime power in the Indian and
Pacific Ocean regions for decades. As such, it has created a network of
alliances, protected the global commons, and ensured freedom of
navigation in critical maritime zones. Through billions of dollars in
weapons sales, mutual defence pacts, grant assistance and multilateral
training exercises, the US has also sought to build the military capacity of
its allies in the Indo -Pacific region.
From being an “offshore balancer” in South Asia during the Cold War and
enabling Pakistan’s desire for parity with India, the US’ attitude and policy
9
I
towards India has changed significantly over the last two decades. Today,
Washington acknowledges India as a dominant regional power and a rising
global power.
Even so, the shift in US attention towards India is driven by changes in
American grand strategy. The combination of interventions abroad and
budget battles in Washington have taken a toll on the US military. As it
rebuilds its military, Washington must turn to local powers to buffer its
own strength and plan for a future characterised by new, powerful regional
competitors. India’s inherent attributes of being a populous, democratic,
market economy make it an ideal partner for Washington in this regard.
India’s Strategic Shift
fter its independence in 1947, India took pride in its policy of
non-alignment. India’s policymakers believed that if New Delhi
Aavoided alignment with either of the two major blocs—namely,
the US and the USSR—it would prevent the emergence of new threats in
the South Asian subcontinent. However, the collapse of the Soviet
Union, and India’s own domestic economic crises forced a re-evaluation
of its foreign policy. In 1991, then Prime Minister Narasimha Rao and
Finance Minister Manmohan Singh oversaw the opening up of India’s
economy to foreign trade, new tax reforms, and deregulation of private
investment. Accordingly, New Delhi’s embrace of market-led reforms also
necessitated engaging in new relationships to augment its domestic
growth.
The most significant of these relationships was with the United States.
Despite some early strains during the Cold War and following India’s
nuclear tests in the late 1990s, the Indo-US relationship has been on the
upswing since the turn of the century. What helped the partnership grow,
among others, were a vibrant Indian-American community, thriving
business relationships, common political values, and a shared appreciation
of opportunities and threats. Further, the geopolitical tensions in the Gulf
region during the 1990s also made New Delhi aware of the need to
expand its energy and economic relationships with other regions. India’s
‘Look East’ policy initiated in 1992 was a result of this imperative. Over
The New India-US Partnership in the Indo-Pacific: Peace, Prosperity and Security
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the years, the Look East policy developed into a multi-pronged strategy
involving new economic ties, defence partnerships and engagement with
regional institutions.
Today, however, the expansion of India’s strategic interests, along with
China’s rise and Pakistan’s continued proclivities, has created greater
political awareness of its extended neighbourhood – from the Straits of
Malacca to the Gulf of Aden. After his election in 2014, Prime Minister
Modi declared India’s intention to shed its approach of balancing; the
prime minister was unequivocal in his desire that New Delhi see itself as a
“leading power”. Prime Minister Modi has called for an expanded role for
India in the Indian Ocean region, and a more proactive approach towards
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development in countries “from Asia to Africa”.
Yet, New Delhi’s aspirations in Asia have undoubtedly been eclipsed by
China’s own meteoric rise. Along with its economic growth, which Beijing
has used to cultivate new political relationships in Asia, its defence
10
modernisation has also pulled ahead of India’s in recent years. China’s
assistance to India’s arch-rival Pakistan has only increased Indian
apprehensions. The view in New Delhi is that China’s policy is one of
strategic encirclement, designed to give the People’s Liberation Army
(PLA) an advantage in a potential conflict, and more leverage in
11
negotiations over disputes. Indian analysts, in fact, seem convinced that
Beijing is intent on setting up Chinese bases and ports from Hambantota
in Sri Lanka, to Cox Bazaar in Bangladesh, and Gwadar in Pakistan for
exactly this purpose. From New Delhi’s perspective, China’s Belt and Road
Initiative is a part of the same strategic encirclement. In Pakistan alone,
12
China has plans to finance over US$ 46 billion in development projects.
Through a combination of readily available low-interest loans, favours to
those in political power, as well as the generous clearance of unpaid debts,
Beijing has created a political and economic network not only across large
parts of Asia but also Africa and Latin America.
New Delhi has responded by strengthening its own civilisational sphere of
influence in Asia. Through the 1990s’ Look East policy, India sought to
engage with Southeast Asia for mutual economic benefit. But Prime
Minister Modi’s ‘Act East’ policy seeks to develop deeper, more strategic
linkages with Southeast Asian states, with the hope that these would
bolster regional security and create a favourable balance of power in Asia.
The New India-US Partnership in the Indo-Pacific: Peace, Prosperity and Security
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India’s initiatives to provide greater agency to its neighbours include
defence training and capacity-building programmes. After signing a
defence cooperation and strategic partnership pact with Singapore in
2015, India recently entered into a bilateral maritime agreement with the
country, which includes improving maritime logistics and reciprocal use of
naval bases. New Delhi is also strengthening cooperation with Hanoi. In
February 2017, India and Vietnam held discussions on the sale of Surface-
to-Air Akash and supersonic Brahmos missiles, with New Delhi providing
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a line of credit for the modernisation of the Vietnamese armed forces.
India’s developmental role in Afghanistan has also been growing, having
invested over US$ 2 billion towards infrastructure reconstruction and
humanitarian aid in Afghanistan over the last decade and a half. Reports
from September 2017 indicate that New Delhi was preparing to
implement 116 new “high impact” development projects in 31 provinces
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of Afghanistan. More importantly, there are signs that India may be
willing to expand military cooperation with Afghanistan. Kabul’s
announcement that New Delhi has further agreed to provide assistance
for the Afghan national defence forces, and deepen security cooperation
to deal with the challenge of cross-border terrorism from Pakistan,
15
certainly point to a bigger Indian security role in Afghanistan.
US Strategy in South Asia
he United States’ own role in South Asia has been rather unique.
During the Cold War, the US strategy was to create a line of
Tcontainment and defence by bolstering regional and local powers
with economic and military assistance. After Europe, the Middle East and
South East/East Asia were the main battlegrounds of the Cold War.
South Asia was an area of interest only periodically, including during the
anti-Soviet Afghan war of the 1980s and the inclusion of Pakistan in the
anti-Soviet alliances CENTO and SEATO. Yet, even then Pakistan was
considered more a part of the Middle East than South Asia, and India was
16
never considered an ally but rather an ‘estranged democracy.’
Ever since the end of the Cold War, India-US relations have been gaining
momentum, albeit at an uneven pace. In the 1990s the bilateral
The New India-US Partnership in the Indo-Pacific: Peace, Prosperity and Security
12
relationship was almost exclusively limited to engaging with India’s
economic liberalisation, balancing ties with Pakistan, and towards the end
of the decade, with responding to India’s nuclear tests. Despite former
US President Bill Clintons intentions to forge ahead with a stronger
partnership with New Delhi, his administration, guided at the time by
Washington’s non-proliferation agenda, chose to impose sanctions on
India as reprisal for its defiant nuclear test.
The task of overcoming earlier tensions, and taking this relationship
forward ultimately fell in the hands of Clinton’s successor, George W.
Bush who worked to expand the scope of India-US cooperation. Bush
devoted enormous political capital towards lobbying for nuclear trade with
India. His administration believed that the Civil Nuclear Cooperation
agreement, which came into effect in 2008, served America’s interest of
17
“help[ing] India become a major world power in the twenty-first century.
At the time, the US was also embroiled in its war against terror following
the events of 9/11. America’s intervention in Iraq, and its continued
presence in Afghanistan, thrust the Indian Ocean region to the centre of
its strategic attention. India’s role in America’s Asia policy was evident from
its 2002 National Security Strategy which declared that “the United States
had undertaken a transformation of its bilateral relationship with India
based on a conviction that US interests require a strong relationship with
18
India. To engage India in regional security matters, Washington and New
Delhi signed a 10-year defence framework agreement in June 2005 that
called for expanded joint military exercises, increased defence-related trade,
and establishing a defence and procurement production group.
This entente with India continued with the administration of Barack
Obama as well, which announced the US’ ‘Pivot to Asia’ in 2011 aimed at
strengthening alliances and enhancing America’s military and economic
presence in the region. India, under this strategy was the ‘linchpin’ of the
pivot, with America declaring that it is “investing in a long-term strategic
partnership with India to support its ability to serve as a regional
economic anchor and provider of security in the broader Indian Ocean
region.”
Two major developments necessitated this pivot. First, South Asia was fast
emerging as the locus of economic growth in the 21st century. Second,
The New India-US Partnership in the Indo-Pacific: Peace, Prosperity and Security
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both India and the US faced complex challenges from China’s rise. Since
2010, China has been flexing its muscle in the region, with its actions over
the Scarborough Shoal in the South China Sea and its growing
engagement with Pakistan. To develop a more coherent strategy towards
Asia, both countries signed a ‘US-India Joint Strategic Vision for the Asia-
Pacific and Indian Ocean Region’ in 2015, which spoke of “a closer
partnership” to promote “peace, prosperity and stability” in the Indo-
Asia-Pacific region, including a joint endeavour to boost regional
economic integration, connectivity, and regional security.
The US’ support for Indian power in South Asia stems from a shift in its
geopolitical approach towards the region. Successive political
administrations from both India and the US have chosen to prioritise their
bilateral relationship to address regional and global affairs. Today, under
the Trump administration, American strategy in South Asia is focused on
counter-terrorism and counter-piracy, freedom of navigation, and
balancing the rise of China. US counter-terrorism operations in South
Asia revolve around maintaining stability in Afghanistan. Over 20
19
registered terror groups operate in Afghanistan, and the government in
20
Kabul only controls half of all districts in the country. In announcing his
strategy for Afghanistan, President Trump specifically called on India to
take a larger role in creating peace in the region.
Now, more than ever, there is recognition in Washington that India shares
the United States’ interests in maintaining stability in Afghanistan and
South Asia. US policymakers are increasingly vocal about their preference
for Delhi’s expanded role in Kabul’s security. India’s financial aid
programme in Afghanistan, and assistance in training Kabul’s armed
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forces, find greater mention in US policy discussions on Afghanistan.
Indeed, India sees Afghanistan as part of its strategic and civilisational
sphere of influence, and critical to securing India’s national security
interests.
The US also sees an expanded role for India in balancing China’s rise in
Asia. While Washington has long relied on Tokyo and Seoul to temper
Beijing’s ambitions, China’s expansion westward and increasing geo-
economic heft has created a situation that cannot be addressed only in
East Asia. As the world’s largest democracy with significant strategic
weight in Asia, India has the potential to balance China’s expansion
The New India-US Partnership in the Indo-Pacific: Peace, Prosperity and Security
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westward. Increasingly, the US has been looking for opportunities to
involve India in the strategic dynamic of the Indo-Pacific region.
Creating Avenues for Cooperation
he growing convergence of US and Indian interests in Asia
requires a steady effort to create more space for cooperation.
TTaking measures to enhance a convergence of interests is
different from executing strategy. The former is a way of building a
cooperative foundation for future partnership, while the latter involves
tactical cooperation, joint military exercises, and treaties.
The strategic convergence between India and the US would benefit from
more dialogue between the two countries, as well as expanded forums for
cooperation with smaller neighbouring powers. Talks should be
complemented with joint investment by Washington and Delhi in
encouraging friendly neighbouring countries that are capable of being
reliable partners.
Washington and Delhi should emphasise dialogues – bilateral, trilateral,
quadrilateral and regional – in order to build tangible plans for
cooperation. These talks allow India and America to address the issues
that face their local partners, in turn building mutual trust. Second, India
and the US ought to enable market-based investments in infrastructure,
opportunities, and state capacities of regional countries. Through
investments in economic growth and state power, India and the US can
help states resist the pull of economically motivated extremism and
lucrative Chinese investment.
By working together, the US and India stand to support a string of
prosperous and democratic nations in South, Southeast, and East Asia
which will prove indispensable to Washington and Delhi’s strategic
objectives. The strategic convergence between the two countries creates
opportunities for partnership that promise to reinforce growth while
balancing threats. By expanding dialogues with, and investments in
regional partners, the United States and India stand to lead a stable,
sustainable order in Asia.
The New India-US Partnership in the Indo-Pacific: Peace, Prosperity and Security
15
THE CHINA FACTOR:
BALANCING 2.0
ntil about a decade ago, policymakers around the world were
largely convinced that political and economic cooperation
Uwould liberalise China internally and produce a responsible
stakeholder internationally. They were encouraged by the fact that China’s
foreign policy had moderated since the domestic reforms of the Deng
Xiaoping era, with Beijing resolving the vast majority of its land-border
disputes and integrating itself into the international system through the
1990s and early 2000s.
By 2008, however, something had changed. China’s “peaceful rise” gave
way to a more nationalistic and assertive foreign policy driven by the dual
22
impulses of “restoration and resentment”. Chinese foreign policy began
to assume sharper edges across a range of regional fault lines, particularly
is territorial disputes: from the seizure of Scarborough Shoal to the
creation of seven artificial islands in the South China Sea; and from
jousting with the US Navy over Freedom of Navigation in the Western
Pacific to provoking a series of mini-crises at its disputed border with
India.
Two major ideological and theoretical understandings underpin China’s
assertive behaviour over the last decade. The first is the “Chinese Dream”.
At the 19th National Congress of the Communist Party of China (CPC)
held in Beijing in October 2017, President Xi Jinping reaffirmed China’s
goal of becoming a “moderately prosperous society” by 2021; a global
technology leader by 2035; and a “strong, democratic, civilized,
harmonious, and modern socialist country” by 2049, the centenary of the
founding of the People’s Republic of China. The second is what China
perceives to be a time of “strategic opportunity”, which began around the
turn of the century with the country’s entry into the World Trade
17
II
Organization (WTO). By Beijing’s calculus, a benign external environment
allowed it to enact domestic economic reforms and build the country’s
military capacity. Following the financial crisis of 2008, which threw
American and European markets into disarray, China has calculated that it
was an opportune moment to shed its policy of “wait and watch” and
emerge as a proactive actor in global affairs.
At the end of 2013, Chinese President Xi Jinping announced China’s most
ambitious foreign policy and economic initiative yet—the One Belt One
Road. The “Belt” is a massive connectivity project that aims to connect
China’s less-developed western frontier provinces to Europe through
infrastructure projects across the Central Asian landmass. The “Road” in
the project’s name refers to the maritime component, which will connect
China’s prosperous southern region to the fast-growing South Asian
economies through new sea routes and ports. It also extends across the
West Indian Ocean to Djibouti, which provides a foothold in Africa, and
acts as a trade route through the Mediterranean Sea to markets in Europe.
Since rechristened the ‘Belt and Road Initiative’, the project is arguably the
most expansive connectivity initiative in modern history, one that serves
multiple Chinese objectives. For one, it is a manifestation of Chinese
leadership in world affairs. Following uncertainty in the West over their
commitments to globalisation and multilateralism, President Xi is intent
on selling the BRI as ‘Globalisation 2.0’. Beijing’s repeated reference to the
ancient “silk road” is an overt reminder of China’s historical centrality in
global affairs that well predates European colonisation of the New World.
Second, the BRI addresses some of China’s own domestic economic
priorities. Many of China’s state-owned enterprises are suffering from
overcapacity and oversupply issues at home. Through the BRI, China
intends to fund overseas operations in order to allow its companies to
create not only demand for their products but also outlets for their labour.
Third, the project also encompasses broader geostrategic goals. The
China-Pakistan Economic Corridor (CPEC), a flagship BRI project, is one
such example. Broadly supported in both Beijing and Islamabad, CPEC
will link western China with the Gwadar Port in Baluchistan. Not only will
this reduce Beijing’s dependency on trade routes that pass through the
Malacca Strait, it also gives it a military foothold in West Asia.
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18
Fourth, the project envisions a ‘digital silk road’—an often-ignored part of
the strategy. Chinese telecommunication companies like ZTE are investing
heavily in laying fibre optic cables in the region, including in areas like
Afghanistan. Further, companies like Huwaei have formed a marine
network to build undersea cables connecting South Asia and Africa.
China’s attempts at creating information communication infrastructure
carries with it significant strategic implications; especially for the
democratic and open architecture of the internet. Beijing has few qualms
about issues such as censorship, human rights and cyber espionage, and is
23
intent on mainstreaming its vision for “cyber sovereignty.”
Chinese scholars like to point out that if successful, the BRI would benefit
over four billion people. This constitutes 63 percent of the world’s
24
population, and around 29 percent of the world’s GDP. At its core,
however, the BRI is a road map for what appears to be a Sino-centric
world order. Through leadership in institutions such as the Asian
Infrastructure Investment Bank (AIIB), and economic regimes like the
Regional Comprehensive Economic Partnership (RCEP), China is in a
position to dictate the norms and rules from East Asia to the shores of
Africa. From its behaviour in the South China Sea, to military stand-offs
with other regional heavyweights like India, it is increasingly evident that
China is not intent on adhering to the liberal norms that other states in the
Indo-Pacific would like to see take hold in the region.
An Uncertain India-China Relationship
ollowing an uptick in bilateral relations beginning in 2009, Prime
Minister Narendra Modi appeared determined to extend
FPresident Xi Jinping an olive branch shortly after he assumed
office in 2014. The effort was undermined almost before it began,
however, with a multi-week Chinese border incursion in Ladakh that
coincided with Xi’s inaugural visit to Delhi in late 2014. That was followed
in 2015 with the announcement of CPEC, the sale of eight Chinese
submarines to Pakistan (China’s largest ever defence export deal), the
opening of China’s first military “logistics supply facility” in the Indian
Ocean, and the transfer of the Gwadar port to a Chinese firm.
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The following year, China moved to block India’s bid to join the Nuclear
Suppliers Group (NSG) and vetoed sanctions on Pakistan-based terrorists
at the United Nations Security Council. The Doklam crisis in the summer
25
of 2017, arguably the longest and most volatile border crisis between
China and India since 1967, demoralised the few remaining pro-China
advocates left in Delhi, crystallising Indian perceptions of China as a
strategic rival, and prompting a reconsideration of the merits of joining
with Australia, Japan, and the US in a more potent and explicit balancing
endeavour.
This series of successive bilateral crises, along with China’s aggressive
courting of India’s neighbours have unfolded amidst a widening
asymmetry of power between the two countries. China’s economy is
approximately five times larger than India’s US$2-trillion economy. In
terms of defence expenditure, China’s budget is approximately four times
larger at US$215 billion, compared to Indias US$55 billion.
On the subject of the BRI, New Delhi’s principal objection lies with
Beijing’s decision to construct the most ambitious infrastructure corridor
in history through territory India claims as its own. That China plans to
channel over US$46 billion in investments to Pakistan (a sum greater than
all the FDI Pakistan attracted over the past 20 years) to construct a
corridor through India-claimed territory Kashmir, was deemed
unacceptable by Indian policymakers.
New Delhi’s concerns, however, extend beyond any obvious reservations
about CPEC legitimising Pakistani control over parts of Kashmir. In
recent years, it has witnessed the BRI materialise in its own
neighbourhood in the form of Chinese loans and investments that have
ensnared neighbouring countries such as Nepal and Sri Lanka in a debt
trap. China has adopted coercive economic and political diplomacy in the
neighbourhood. Chinese firms have illicitly funnelled money to pro-
Beijing politicians in Colombo, and provisions have been discretely
inserted into agreements that grant China effective sovereignty over Sri
Lankan land and airspace.
Indian officials are further concerned by the unsustainable levels of debt
dependency being bred by Chinese loans in South Asia, as well as Beijing’s
propensity to swap debt for equity stakes and geopolitical influence. Not
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20
surprisingly, many Indian observers now view the BRI as a means to
extend China’s influence throughout its neighbourhood in ways inimical to
India’s interests.
For a country that has at times proven highly deferential to China’s
sensitivities, few expected India to withhold support for President Xi
26
Jinping’s signature Belt and Road Initiative. In fact, New Delhi went
many steps further, emerging early as the lone voice openly and directly
critical of the BRI. As Japan, the US, and others cautiously weighed their
options, Indian leaders and diplomats repeatedly aired their concerns
about the initiative, both in public and in private. Ultimately, when
declining China’s invitation to participate in the Belt Road Forum in May,
2017, India stated in unequivocal terms:
“We are of firm belief that connectivity initiatives must be
based on universally recognized international norms, good
governance, rule of law, openness, transparency and equality.
Connectivity initiatives must follow principles of financial
responsibility to avoid projects that would create
unsustainable debt burden for communities; balanced
ecological and environmental protection and preservation
standards; transparent assessment of project costs; and skill
and technology transfer to help long-term running and
maintenance of the assets created by local communities.
Connectivity projects must be pursued in a manner that
27
respects sovereignty and territorial integrity.”
Alone No More
or India’s strategic community, America’s China policy in recent
years has been a source of uncertainty. While the Obama
Fadministration did offer new weapons platforms and military
assistance packages for regional partners, even lobbying New Delhi to
revive the Quad, it could never quite shake off the impression of being
“soft” on China. This was reinforced by the perception that Washington
had responded weakly to Chinas boundary-testing in the East and South
China Seas, including the 2012 seizure of Scarborough Shoal.
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The election of President Donald Trump in November 2016 did little to
reassure partners about America’s enduring commitment to the region.
Despite an intensification of US Freedom of Navigation Operations
around China’s artificial islands in the South China Sea, President Trump’s
seeming ambivalence toward US alliances on the campaign trail, his
periodic praise of Chinese President Xi Jinping, and his apparent
indifference toward BRI offered little consolation to New Delhi.
Yet, as experienced Asia hands populated key positions in the US
government, a different Asia strategy has begun taking shape—one
increasingly focused on, and influenced by India. After he returned from a
trip to India in October 2017, Defense Secretary Gen. James Mattis
signalled for the first time that the US harboured serious concerns about
China’s BRI initiative. “In a globalized world, there are many belts and
many roads, and no one nation should put itself into a position of
dictating ‘one belt, one road’,” he explained in congressional testimony.
Mattis’ reservations echoed those of Senator Charles Peters, who worried
that BRI represented a strategy “to secure China’s control over both the
continental and maritime interests, in their eventual hope of dominating
28
Eurasia and exploiting natural resources there.
Within days of Mattis’ testimony, echoes of the US’ shift on BRI could be
heard in far-off Australia. Frances Adamson, a former Ambassador to
China and now the Secretary of Australia’s Department of Foreign
Affairs, voiced Australia’s reservations about BRI for the first time: “Let’s
look at the financing arrangements, let’s look at the governance
arrangements because we know…infrastructure projects can come with
very heavy price tags and the repayment of those loans can be absolutely
29
crippling.”
If Mattis’ remarks were the opening act, the main event was the
remarkable speech delivered by Secretary of State Rex Tillerson on US-
India ties on October 18 in Washington’s Center for Strategic and
International Studies (CSIS). Tillerson argued that the US was ready to
“double down on a democratic partner that is still rising, and rising
responsibly, for the next 100 years.” He insisted that America was the
“reliable partner” India needs with “shared values and vision or global
30
stability, peace and prosperity.”
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22
Tillerson’s affection for India was matched by his overt criticism of China.
He argued that China was rising “less responsibly” than India and “at
times undermining the international rules-based order,” acting
provocatively in the South China Sea and working to “subvert the
sovereignty of neighboring countries.” Tillerson then confirmed America’s
change of heart on BRI, echoing many of the concerns and objections
raised by India, including the initiative’s approach to infrastructure
financing. He argued that BRI investments were saddling countries “with
enormous levels of debt,” adding:
[T]oo often foreign workers are brought in to execute these
infrastructure projects. Financing is structured in a way that
makes it very difficult for them to obtain future financing
and oftentimes has very subtle triggers…that results in
financing default and the conversion of debt to equity. So
this is not a structure that supports the future growth of
these countries.
Perhaps most significantly, the US Secretary of State revealed that
Washington had begun “a quiet conversation” with America’s partners
about how to “create alternative financing mechanisms” that would offer a
choice to countries eager for investment, but wary of China’s conditions.
He recognised that the US, Japan, and India would not be able to compete
with China’s financial terms, but insisted: “countries have to decide, what
are they willing to pay to secure their sovereignty and their future control
31
of their economies?”
The Revival of the Quad
he US and India have spent the better part of the past decade
considering policy responses to their shared concerns over
TChina’s rise on the world stage. So, too, has Japanese Prime
Minister Shinzo Abe, who first proposed an informal balancing coalition
in Asia in 2007. At the heart of Abe’s plan for a “Democratic Security
Diamond” lay a democratic “Quad” of Indo-Pacific powers —Australia,
India, Japan and the US—tasked with safeguarding the liberal order across
an “arc of freedom and prosperity.” The initiative produced an
unprecedented quadrilateral strategic dialogue in May 2007 and multilateral
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23
military exercise later that year, but was dissolved a few months later
32
following Australia’s withdrawal from the grouping.
The first attempt at a Quadrilateral Dialogue initiative fell victim to
domestic politics and international circumstances. Domestically, Japan and
India confronted a firestorm of protests by opposition parties in addition
to the demarches issued to each capital by Beijing. Tokyo and New Delhi
felt compelled to prioritise engagement over balancing. India resisted a
formal revival of the grouping, and Australia’s inclusion in the annual
Malabar naval exercises. Simultaneously, the Australian and Chinese
economies grew increasingly intertwined. The Obama administrations
“Rebalance to Asia” struggled to find coherence and failed to reassure
regional partners. When Chinese President Xi Jinping unveiled the
ambitious Belt and Road Initiative (BRI), Quad partners were divided on
how to respond.
However, several events in 2017 – including the standoff between Indian
and Chinese troops in Doklam at the India-Bhutan-China tri-junction –
have underscored the need for greater strategic coordination between
33
India, Australia, Japan and the US.
First, the Trump administration has had a change of heart on the BRI in
the fall of 2017, joining India in criticising the initiative. Second, Japanese
voters handed Prime Minister Shinzo Abe’s party a resounding electoral
victory. Within days of Abe’s win, Foreign Minister Taro Kano indicated
that Japan would formally press for a reconstituted Quadrilateral Dialogue
34
in November. After declining such requests in years prior, Delhi agreed.
As the four democracies move toward more active, overt, and coordinated
balancing activity, India is demanding a greater level of clarity,
commitment, and reassurance from the other three. It is, after all, the
outlier in the group. Australia, Japan and the US are legally bound by treaty
commitments to aid in each other’s defence. None of the three countries
shares a land border with China, let alone a disputed one. Neither are they
sandwiched between China and an unstable, nuclear-armed rival that also
happens to be a Chinese client state. India is less secure, less developed,
and more exposed to Chinese pressure than the other three, particularly
since its relationship with Moscow is now only a shadow of its former self.
Reassuring India will be an ongoing challenge and priority for the US and
other members of the Quad.
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24
Free and Open Indo-Pacific
s the Quad countries converges on the BRI and the need to
offer alternative financing mechanisms for regional states
Aseeking infrastructure investments, they are also coalescing
around a positive new vision for the regional order writ large. In recent
years, Canberra, Delhi, Tokyo, and Washington have grown more vocal in
airing their concerns about the challenges China is posing to the norms
and principles that informally constitute the regional order. In policy
documents and joint statements, they have begun placing greater emphasis
on the need to promote and defend freedom of navigation and overflight;
respect for the rule of law as reflected in the navigational provisions of
the UN Convention on the Law of the Sea; the peaceful settlement of
disputes free from coercion or force; as well as free and open markets and
transparent infrastructure financing.
In its final years in office the Obama administration had begun grouping
these principles under the moniker of a “principled, rules-based order.”
The “rules-based order” also made its way into the Trump administrations
lexicon, but by the end of 2017 the democratic Quad had begun to
coalesce around a new nomenclature: a “Free and Open Indo-Pacific”, a
formulation first proposed by Prime Minister Abe and later included in a
35
joint vision statement issued by Japan and India in December 2015.
Since then, the concept has come to encapsulate a vision for a region
capable of balancing Chinese influence and governed by the liberal
principles of a “rules-based order.” During a major policy speech
delivered by President Trump in Vietnam in November 2017, he
36
elaborated on his “vision for a free and open Indo-Pacific.” He described
it as “a place where sovereign and independent nations, with diverse
cultures and many different dreams, can all prosper side-by-side, and
thrive in freedom and in peace.” For the “Indo-Pacific dream” to be
realised, Trump added, “we must ensure that all play by the rules, which
they do not right now.”
The first phase in this new Balancing endeavour involved the formal
revival of the Quadrilateral dialogue in November 2017, and reaching a
basic consensus on BRI and the Free and Open Indo-Pacific. The second,
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25
more challenging phase will require the four nations to construct a new
model for strategic, defence, and intelligence cooperation with India; to
not only define the “Free and Indo-Pacific” but articulate what constitutes
a challenge to that order and how the Quad will respond to such
challenges; to better coordinate efforts at combating Chinese “sharp
37
power” and its increasingly brazen interference in the affairs of its
neighbours and peers; and to forge a consensus on operationalising the
Quad’s shared vision for a BRI alternative by leveraging the relative
strengths of the four parties, not least Japan’s formidable overseas
development assistance.
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26
PARTNERSHIP IN
SOUTHEAST ASIA
midst a broad convergence of American and Indian geopolitical
interests in the Western Pacific, there is potential for US-India
Apartnership in Southeast Asia. For the US, Southeast Asia has
become the locus of a great power contest with China, as well as for the
application of vital international norms, such as the freedom of
navigation. India, for its part, regards the region as a focal point for its
Act East’ policy. Of particular importance for New Delhi in Southeast
Asia is Myanmar, a state with which India shares a porous and dangerous
land border. Myanmar is critical in India’s fight against insurgencies in its
northeastern region, and plays a crucial role in the conception of its Act
East policy. It is, however, China’s growing stature in Southeast Asia that
worries Indian policymakers the most.
For their respective reasons, therefore, India and the US regard the
prevention of Chinese dominance of Southeast Asia as a shared objective.
U.S. Interests in Southeast Asia
outheast Asia commands intense US strategic interest because of
the maritime nature of America’s presence in the region. Guam,
Sthe Northern Mariana Islands, American Samoa and the presence
of US bases in Japan and South Korea make the US a “resident power” in
the region. America’s security commitments to its territories and to Japan,
South Korea, the Philippines, and Taiwan, require unfettered access to
international sea lines of communication, especially in the South China
Sea. Washington is also concerned about the long-term interests in
freedom of merchant shipping through these waters. Given the reliance
of its economy on global supply chains, the US cannot afford for any one
28
III
country to dictate the conditions under which it accesses the region’s
waters – even if the terms proffered by the Chinese are currently
permissive.
While China has its maritime claims in the South China Sea, the debate
over its strategic objectives remains unresolved. It could simply be a
matter of sovereignty. Many in Beijing hold that the South China Sea has
38
been Chinese “blue soil” since ancient times, and that China is obliged to
occupy its features and administer its waters. Indeed, the “great
rejuvenation” narrative of the Chinese Communist Party has created a
dynamic whereby China may be bound to risk conflict over its claims for
39
the sake of regime legitimacy. Other possible motivations for China’s
aggression in the South China Sea revolve around issues of geopolitical
advantage. In other words, its island building and fortification in the
Spratlys could point to the development of force projection capabilities in
order to coerce its neighbours and challenge America’s position in the
region. Alternatively, it could be part of an effort to develop military
dominance within the first island chain that runs southward from Japan’s
Ryukyu Islands, through Taiwan and the Philippines down to Borneo.
Dominance of an area so enclosed, this argument goes, would allow
Chinese forces to both break what it sees as a barrier to the wider Pacific
and to hold at risk American territory to the immediate east of the island
chain. Finally, some analysts maintain, the Chinese are cultivating the
South China Sea as a bastion for its growing arsenal of nuclear-armed
submarines.
The United States has relationships in Southeast Asia that bolster its
physical presence in the region. These include treaty allies such as the
Philippines and Thailand; the near treaty ally, Singapore; and security
partners such as Brunei, Malaysia, Vietnam, and Indonesia. While most of
Washington’s regional partners also seek to balance relationships with
other states, especially those with the prospect of bringing real economic
development, their concerns have less to do with American ambition than
with its staying power.
These concerns have become particularly pronounced under the Trump
administration. In a poll of Southeast Asian policy elites conducted in
April 2017 by the Singapore-based ISEAS-Yusof Ishak Institute, only 42
percent believe that the Trump administration is interested in Southeast
The New India-US Partnership in the Indo-Pacific: Peace, Prosperity and Security
29
Asia; while 56 percent believe that US engagement will decrease during the
next four years. With regard to its competition with China, 84 percent
believe that the US has lost strategic ground. And despite their interest in
balancing both relationships, more than 70 percent of the respondents
believe China to be the most influential country in the region today and 10
40
years into the future.
India’s Interests in Southeast Asia
espite India’s strategic interest in Southeast Asia, it has failed to
keep pace with Chinese influence. China trades six times as
41
Dmuch with the region, and its investments there dwarf those
42
of India. The imbalance even holds with regard to each country’s
relationship with Myanmar – where India’s interests are especially critical.
43
China-Myanmar trade is seven times greater than India-Myanmar trade
and China holds a 26-percent share of Myanmar’s inbound FDI,
44
compared to a one-percent Indian share.
On the diplomatic side, although both countries are deeply involved in the
region’s institutional architecture, such as the ASEAN Regional Forum,
ASEAN Defense Ministers Plus, the East Asian Summit, and others,
China is a much greater factor in policy calculations. The ISEAS-Yusof
Ishak poll, for example, points to a perception of China as the most
influential country in the region, while India barely registers at all (74.8
45
percent for China; 0.9 percent for India). While the label “most
influential” may be a bar that India does not aspire to, the disparity in the
numbers illustrates the vast difference in the importance accorded to
China by Southeast Asian elites.
China has specific goals in Southeast Asia: Its state-owned enterprises and
private businesses operating in the region are in search of profit. In some
cases, however, they are willing to substitute equity stakes in a manner that
will strategically benefit the Chinese government. A good example is the
Chinese state-owned CITIC Group, which offered to take an 85-percent
stake in a port being developed on Myanmar’s Bay of Bengal coast in
46
exchange for concessions on the much-maligned Myitsone dam. Another
specific geopolitical goal that Chinese businesses seem to be facilitating is
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30
the damming of the Mekong River, the result of a series of projects that
are already well underway.
There is, however, another broader strategic Chinese objective and it lies
in shaping Southeast Asian attitudes in a way that ultimately facilitates
China’s rise. As Professor Evelyn Goh puts it in her 2014 study of
Chinese power, China “wants to reshape the incentive structure and
perceptions of its neighbors so that they would not agree to become
47
complicit in any attempt to constrain it.” China’s influence in the region
has reached the point where its interests are at top-of-mind in Southeast
Asian capitals. There are no indications that India commands similar
interest in the region. Indeed, given the direction the region seems to be
taking on the South China Sea—as evidenced by the Philippines retreating
from its 2016 PCA victory; a China-endorsed ASEAN Foreign Ministers
reference to the dispute last summer; and another toothless framework for
a code of conduct for the South China Sea—the call to Beijing may have
already become more important than the one to Washington. At least one
ASEAN member, Cambodia, is well-known to have placed calls to
Chinese officials to seek guidance on ASEAN statements as they were
being negotiated.
Mitigating Chinese Influence
ow then must India and the US cooperate to mitigate growing
Chinese influence in Southeast Asia? Influence exerted is
Hpower expressed, and ultimately more important than raw
power itself. The Chinese may not be changing Southeast Asian minds on
some specific issues, but this is not where the contest for influence is
actually occurring. As Professor Goh points out, the contest is occurring
around issues where perspectives are either shared or debated. China and
Southeast Asia share a priority on economic cooperation. Southeast Asia is
intensely interested in development, and China is willing to help provide it
at reasonable costs. The balance between the good of its contributions to
economic development, and what is still largely a theoretical geopolitical
threat to the region is debated. At present, the scales weigh in favour of
China’s economic contribution to the region. With rare exception, China is
not coercing Southeast Asian positions, but creating context in which
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31
cooperation trumps the region’s opposition to what may be China’s
strategic aims.
This is how China prevented the Philippines from aggressively pursuing its
legal approach to the maritime dispute. Beijing’s bailout of Malaysian
Prime Minister Najib Razak from his corruption problems, and its
contributions to Malaysia’s economy mutes the country’s criticism of its
action in South China Sea. China has similarly defused Indonesia’s
tradition as a regional leader. Under President Joko Widodo, Indonesia has
sought to focus on its own narrow interest related to the Natuna Islands,
but has otherwise chosen to stay above the fray concerning solutions to
48
the larger issue. In the Mekong, meanwhile, China’s contributions to
downstream economies and creation of new mechanisms for cooperation
allow it to dam the upper reaches of the river in a way that is
disadvantageous for countries like Laos, Thailand, Cambodia, and
Vietnam.
Today, the most concrete results of this Chinese influence may be in the
South China Sea and the Mekong. Tomorrow, it could be on basing rights,
border controls or military cooperation. Yet, despite this, the US and India
are not doing what is necessary to contest growing Chinese influence.
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32
A PARTNERSHIP
FOR CONNECTIVITY
hina is a fact of life for the nations of Southeast Asia, as it is for
India and the US. Its role in the region is only set to grow.
CSoutheast Asian countries, although at times apprehensive, will
continue to welcome Chinese investment and trade, as well as their
diplomatic overtures. Regulatory lacunae, ineffectual logistics networks,
and limited transport connectivity have all impeded trade between South
Asia and Southeast Asia. Sustained economic growth in the Indo-Pacific
will require good governance, building new infrastructure projects, and
investing in human resources. For ASEAN states, their national interests
are often defined primarily in economic terms. They are keen on improved
connectivity, market integration and free trade. India and the United States
must cooperate to ensure that the idea of the Indo-Pacific best serves
these interests.
However, the goal of India-US cooperation should not be that of
excluding China, but rather to ensure that their nations’ presence is
sufficient to offer choices to Southeast Asian countries. A failure to
synergise operations in Asia will only see Chinese influence grow, with
inevitable impact on the US, and India’s geostrategic positions and
national interests. Both India and the United States must not ignore the
appeal of the BRI, especially to countries that are in dire need of finance
and investments in physical and digital infrastructure. Instead, the goal of
this relationship must be to ensure that China’s actions align with
international norms and rules that govern connectivity projects. It must
also offer states in the Indo-Pacific alternative options, in order to ensure
that China cannot leverage its BRI investments to gain undue political and
economic influence over its smaller neighbours.
34
IV
A four-pronged strategy will allow the US and India to develop a bilateral
approach to improving connectivity in Asia:
Highlight the Significance of Norms
ndia appeared an outlier when it issued its full-throated criticism of
the BRI. It was the only major country which was absent from the
IBRI summit in May. Less than half a year later, however, other
Indo-Pacific democracies have followed suit. Speaking at the Indo-Pacific
Oration in New Delhi in July 2017, Australian Foreign Affairs Minister
Julie Bishop stated that her objective for the Indo-Pacific is for “Australia
to be an active participant, in partnership with other nations, in ensuring
that a predictable international rules-based order is respected and upheld,
49
as the foundation for peaceful cooperation in the region.” The same
sentiments were conveyed in Donald Trump’s “Indo-Pacific Dream”, even
going so far as to replicate India’s language on “responsible financing
50
arrangements” and “good governance” for infrastructure projects. Even
the European Union (EU) has called for the BRI to follow “market rules
51
and international standards.”
These are not simply the words of countries that are intent on curbing
China’s influence or growth in the region. Fiscal responsibility,
environmental audits, good governance and the rule of law must form the
bulwark of any large connectivity projects. China’s failure to adhere to
these norms has already sparked regional instability. According to a
January 2016 report by the Oxford Said Business School, for example,
around 55 percent of the projects that China has invested in are
economically unviable at the outset. Another 17 percent have generated
lower than forecasted benefit to cost ratio, and only 28 percent could be
52
considered economically viable. The United Nations has similarly raised
concerns about the AIIB’s human rights record. The UN notes: “The
AIIB has an environmental and social policy framework largely modelled
on the World Bank safeguard policies. However, it is a comparatively loose
framework with significant gaps from a human rights perspective. It is not
yet clear exactly how the AIIB will apply this framework in practice, or
how the traditional MDBs will react to the new development banks’
53
approach to environmental and social issues.”
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35
The consequences of these decisions on a state’s socio-economic
development pathway are enormous. Sri Lanka is perhaps one of the most
disturbing examples. Unable to repay its onerous debts to China for
development of the strategically located Hambantota Port, Sri Lanka had
to hand over the port to Beijing on a 99-year-long lease. Other projects
along the BRI have also come under scrutiny for failure to adhere to
environmental standards. Several South Asian states have raised such
concerns; Vietnam and Cambodia, for example, have complained about
drought due to hydropower plants along the Mekong River, and Myanmar
has expressed displeasure over the forest management practices of
54
Chinese firms operating in its territory.
By raising the issues of unviable finance options, poor environmental and
human rights records, and questionable investment motivations, both the
United States and India can ensure that regional connectivity adheres to a
rules-based order while benefiting states in South Asia.
Create Synergy Between Physical and Digital Connectivity
Projects and Regional Initiatives
ndia has long understood the need to link South Asia to South East
Asia. Its historical, geographical and cultural ties to the region give it
Ithe capacity to influence regional outcomes and integration efforts.
With the election of Prime Minister Modi in 2014, the government’s
official policy shifted from the ‘Look East’ of the 1990s to ‘Act East’. In
this endeavour, India has been extremely proactive. In December 2017,
India hosted the ASEAN-India Connectivity Summit to discuss “Powering
Digital and Physical Linkages for Asia in the 21st Century”. Apart from
China and Japan, India is the only other country to have established an
ASEAN Connectivity Co-Coordinating Committee to find synergy
between the Master Plan on ASEAN Connectivity and New Delhi’s
infrastructure development plan.
The timing and theme of the summit is no mere coincidence. It is an
implicit reference to India’s competitive role in offering South East Asian
states a democratic alternative to the BRI. Already, India has significant
investments in the region. India has concluded an FTA with ASEAN and
The New India-US Partnership in the Indo-Pacific: Peace, Prosperity and Security
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it is part of negotiations on the Regional Cooperation Economic
Partnership. The India-Myanmar-Thailand Trilateral Highway, when
completed, will connect the three countries from Moreh in India to Mae
Sot in Thailand. Other regional connectivity projects include the Kalandan
Multi-Modal Transport Project that will connect India’s northeast with
Sittwe on Myanmar’s Bay of Bengal coast and from there by ship to
Calcutta. Beyond this, the Bay of Bengal Initiative for Multisectoral
Technical and Economic Cooperation (BIMSTEC) plans to extend to
scope of their cooperation to include infrastructure development plans
between the countries. BIMSTEC met in October 2016 on the sidelines
of the BRICS Summit in Goa. New Delhi has also announced a US$5-
billion investment plan for regional integration projects in South Asia,
55
specifically in Bangladesh, Nepal and Bhutan.
New Delhi has also been proactive in shaping a vision for the Indian
Ocean Region. During his 2015 visit to the Seychelles and Mauritius,
Prime Minister Modi made it clear that the Indian Ocean littoral is at the
56
“top of [Delhi’s] policy priorities. Articulating India’s priorities in the
region, Modi announced several initiatives to expand cooperation on the
“blue economy” in order to allow states to better invest in maritime
resources in a sustainable manner. He also highlighted that maritime
security in the region must be the responsibility of regional actors. The
Security and Growth for All in the Region (SAGAR) vision expands on
India’s role as a net security provider in cooperation with other littorals.
New Delhi was clear that it was willing to explore economic and
development opportunities with other major maritime states such as the
United States.
US policymakers are willing to back the India relationship, in part because
New Delhi views Southeast Asia as an increasingly strategic space, where
Indian outreach must keep pace with Chinese influence. Even before the
idea of a “free and open Indo-Pacific” took hold, there were early signs of
cooperation between India and the US in the region. At India’s 2015
Republic Day celebrations, the two countries elevated Indo-US ties with
an agreement on “US-India Joint Strategic Vision for Asia and the Indian
Ocean Region”. The Obama administration had earlier put forward a
connectivity initiative known as the Indo Pacific Economic Corridor
which sought to create new energy routes, improve trade corridors, and
focus on the ease of doing business in South Asia. The two countries also
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held extensive official talks on promoting sustainable ocean economies for
the first time in January 2017. Coastal and marine protection, sustainable
marine resource management, and joint exploration of exclusive economic
zones are themes that merit continued and deeper engagement, to which
must be added issues such as maritime diplomacy, job creation, energy
security, marine information and communication technologies, and
maritime connectivity.
Both New Delhi’s Act East Policy, and the Trump administration’s
renewed emphasis on the Indo-Pacific Economic Corridor have enormous
scope for synergy. In 2015, the US State department had already
recognised this potential, stating, “Complementing Indias Enhanced Look
East Policy, the United States envisions an Indo-Pacific Economic
Corridor that can help bridge South and Southeast Asia – where the
Indian and Pacific Oceans converge and where trade has thrived for
57
centuries”. The US’ own unique relationship with the ASEAN is equally
capable of adding heft to these initiatives. The Sunnylands Declaration of
2016, for example, contained several new business initiatives, including a
programme called “US-ASEAN Connect”, which involves the US setting
up regional hubs in Jakarta, Singapore and Bangkok to connect
58
entrepreneurs and businesses to support local innovation. These are
important elements of soft power that must not be ignored.
Along with the US’ leadership, Japanese PM Shinzo Abe has also sought
to align Tokyo’s “Free and Open Indo-Pacific Strategy”, unveiled in 2012,
with India’s Act East Policy. Abe sought to frame the relationship in
cultural terms, stating that Japan is undergoing “The Discovery of India”
59
in order to realise the vision of a “broader Asia. Under this strategy,
Japan is spending some US$744 million on infrastructure projects in
India’s North-East regions—an important link to Myanmar. Further, New
Delhi will also allow Japan to invest in the strategically located Andaman
and Nicobar Islands under this scheme. Located close to the Malacca
Straits, these islands are a crucial component of India’s maritime strategy.
Moreover, almost one-third of India’s Exclusive Economic Zone lies
around these islands, making them key components of the economic pillar
of New Delhi’s Act East Policy. India and Japan have also jointly
developed a vision for the Asia Africa Growth Corridor which intends to
integrate Africa with South Asia via the West Indian Ocean. It forms a key
element of the Indo-Japan Vision 2025 for the Indo-Pacific, and is based
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on infrastructure development and building economic and social
60
partnerships.
Physical connectivity, however, is only one part of the big picture.
Southeast Asia is also the world’s fastest growing internet region, with
estimates suggesting that four million new users will emerge from the
region every month for the next five years, translating into a user base of
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480 million by 2020. These users will also be relatively young and part of
Southeast Asia’s burgeoning middle class, with 70 percent of them being
under the age of 40.
However, unlike the West, which came online without having to face
serious cybersecurity concerns, individuals, businesses and states in the
region will be connecting at a time of unprecedented cyber threats. They
will also be coming online at a time when the normative foundations of
the internet are under siege: Beijing’s model of cyber-sovereignty
competes directly with the liberal foundations of the internet. India-US
partnership in the digital sphere thus firmly falls within the economic and
developmental remit and the regional strategic calculus.
Asian leaders understand that the world economy will be defined by
information management and data flows rather than agriculture and
manufacturing. Digitisation is seen as a key tool to build a knowledge-
intensive economy and transition towards middle-income status. Digital
connectivity thus merits particular attention. Cooperation between India
and the US, who share many of the same political values along with a
strong commercial relationship, has the potential to expand digital trade as
well as address common security concerns about global digital interaction.
By official estimates, Prime Minister Modi’s ‘Digital India’ programme
alone has the potential to increase India’s GDP by 20-30 percent by 2025.
The Aadhaar ecosystem, which intends to employ a digital identity as the
backbone of this programme—bolstering digital payments, improving
government services, and allowing businesses to innovate around a public
data economy—is a unique Asian offering. American companies from
Google to Facebook are already seeing commercial potential in such an
initiative; WhatsApp, for example, has chosen to integrate with the Unified
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Payments Interface to offer mobile wallets services. Already, two digital
ecosystems are converging in manners that are replicable across Asia.
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The Asian Development Bank (ADB) has highlighted the value of a
Digital Identity System in the Indo-Pacific region: “ID systems offer a
means for developing nations to fast-track the process of development.
By making service delivery efficient, enabling digital payments and a digital
economy, and protecting citizens’ rights and access to services, ID systems
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can accelerate economic and social development. A region-wide digital
platform to authenticate residents in South Asia raises the potential to
further integrate markets and improve governance delivery mechanisms.
Already, USAID’s Global Development Lab is working with the Indian
government to test and identify the scalability of digital payments
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solutions based on such ID systems. American leadership in institutions
like the World Bank and the ADB allow it to further explore such
synergies and regional partnership to develop on India’s Aadhaar platform.
An India-US bilateral relationship, coupled with a common digital vision
for the region can accomplish at least three aims: First, led by India,
countries in the Indo-Pacific region can build a digital economy that
responds to developing country imperatives—such as affordable access, e-
governance delivery, and local content generation. Second, the US, which
continues to remain the locus of innovation and intellectual capital, can
lead with the private sector in providing digital solutions for emerging
markets and users; along with providing their expertise in cybersecurity.
Finally, both countries can ensure that constitutional freedoms, such as
free speech and privacy, form the basis of an Asian digital order.
Eventually, such a relationship will catalyse the institutionalisation of
norms in cyberspace—whether pertinent to data flows related to digital
economy and e-commerce, or related to critical infrastructure, defence,
and public services —providing a model working relationship for a
common digital space in the Indo-Pacific. This space must be democratic,
affordable, innovative and secure.
Develop Credible, Transparent and Quality Funding
Mechanisms
onnectivity and regional integration efforts cannot succeed
without alterative and credible finance options. According to
Cestimates by the Asian Development Bank, Asia will require
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more than US$22 trillion upto 2030 to support infrastructure projects.
Beijing has already taken a lead in this effort, committing around U$2
trillion over the past three years through multiple sources, including the
65
AIIB and China’s state banks.
Amongst the Indo-Pacific democracies, Japan has moved quickly to
address this shortcoming. In May 2015, Prime Minister Abe announced a
new framework on “Partnership for Quality Infrastructure: Investment for
Asia’s Future”—a five-year initiative worth US$110 billion. Japan seeks to
differentiate its investments from those made by China by emphasising
that the PQI will encourage “quality investments” that are cost effective,
environment friendly, and based on the host countries development plans.
As he announced the project, Abe emphasised that “in order to make
innovations extend to every corner of Asia, we no longer want a ‘cheap,
but shoddy’ approach”— an indirect critique of China’s opaque funding
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efforts.
The United States is looking for ways to aid in this endeavour. The US
Trade and Development Agency has recently signed an agreement with its
Japanese counterpart to develop co-financing strategies “to advance
quality energy infrastructure in third-country emerging markets in the
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Indo-Pacific.” However, aside from concerns over the value of such
business support programs to the American taxpayer, such efforts are
certainly insufficient. A better approach was highlighted by Secretary of
State Rex Tillerson during his speech at CSIS. He singled out the role of
the Millennium Challenge Corporation, which creates merit-based regional
infrastructure project management and financing in countries like Sri
Lanka and Nepal. Others have advised that American agencies like the
Overseas Private Investment Corporation and the Export Import Bank
should expand their capital base to support such competitive finance
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options in the Indo-Pacific.
As key stakeholders in the region, India, the United States and Japan must
create new dialogues and partnerships that are capable of aligning these
various initiatives to ensure strategically targeted and efficient allocation of
resources. While India can form the linchpin in these endeavours,
providing human capital and on-the-ground administrative support, the
United States and Japan can provide technological and financial assistance.
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Re-affirm the Centrality of Asian Institutions
aving laid down the foundations upon which Asian integration
and connectivity will take place—by aligning norms,
Hsynchronising initiatives, and shoring up finances—the Indo-
US partnership must also articulate a position on which actors will take
the lead in determining their outcomes. New Delhi is cautious about the
strategic implications of mega connectivity projects, and has chosen to
place regional actors at the forefront of guiding their development.
Foreign Secretary S. Jaishankar articulated India’s concerns that the BRI
fails to emulate this, stating that “..this [BRI] is a national Chinese
69
initiative…devised with national interests.”
China has repeatedly attempted to subvert the autonomous political
authority of ASEAN groupings. Following The Hague Tribunal’s ruling
on the South China Sea dispute, observers believed that the 49th ASEAN
foreign ministers meeting in July 2016 would be an opportunity for the
regional bloc to unanimously reaffirm its commitment to a rules-based
order. Unfortunately, Beijing’s closest ally, Cambodia, utilised its veto to
block the group from mentioning the tribunal verdict in the joint
70
statement. The United Sates and India must work together to ensure that
states in the region can resist pressure for Beijing on such issues.
For example, at the East Asian Summit, New Delhi was clear on the
“centrality of the ASEAN” in any new connectivity and security
71
architecture. In August 2015, at the Forum for India – Pacific Islands
Cooperation (FIPIC) summit in Jaipur, Prime Minister Modi expressed
support for the vision of “Pacific Regionalism” to better integrate
72
decision-making. Such positions stand in stark contrast to the bi-lateral
foundations of the Belt and Road Initiative. The United States has also
repeatedly reaffirmed these principles in various joint statements, most
recently at the November 2017 US ASEAN Summit, where it stated, “We
recognise and support ASEAN Centrality and ASEAN-led mechanisms in
73
the evolving regional architecture.
Accordingly, the United States and India should work towards
strengthening institutions in the Indo-Pacific that support a rules-based
order, such as the ADB and the Asia-Pacific Economic Cooperation
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(APEC). Towards this end, it is important that the US expedite its efforts
to induct India into the APEC; India has had an observer status since
2011. Already, Japan has extended its support for India’s candidature as
permanent member. For its part, New Delhi must work to shed the image
of its intransigence towards trade deals, and improve economic ties with
the region.
The US’ withdrawal from the Trans-Pacific Partnership (TPP) and
President Trump’s “America First” approach has been greeted with some
skepticism by regional observers. And yet, Washington continues to
remain engaged with the members of the TPP. Indeed, the US does not
seem willing to give up its leadership of the Indo-Pacific, as seen in the
various visits by Southeast Asian heads of state to Washington; President
Trump’s visit to the Philippines for the East Asian Summit and Vietnam
for APEC; Vice President Mike Pence and other Cabinet-level visits to
Southeast and East Asia; and Secretary Tillerson’s engagement of the
ASEAN Foreign Ministers as a group.
India, on the other hand, has repeatedly affirmed its engagement with the
wider Indo-Pacific region. Practical cooperation between India and the US
must start with both sides coordinating their strategic perspectives, policy
approaches and sharing information. They can do these through bilateral
mechanisms like the new US-India 2 x 2 dialogue involving each country’s
foreign and defence ministers and more broadly through their tri-laterals–
US-India-Japan and India-Japan-Australia – as well as the quadrilateral
dialogue also involving Australia.
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TOWARDS GREATER
MARITIME SECURITY
COOPERATION:
A RULES-BASED
INDO-PACIFIC
f there is one area of India-US relations that merits special mention,
it is the maritime partnership. Consistent with their global strategic
Ipartnership and a new framework for defence cooperation, New
Delhi and Washington have raised their level of naval engagement,
committing themselves to the protection of the regional commons. Three
developments have allowed this engagement to take place. First was the
strategic conceptualisation of the wider Indo-Pacific region. In a 2007
speech delivered at the Indian Parliament, Japanese Prime Minister Shinzo
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Abe spoke of the “confluence of two seas”. “The Pacific and the Indian
Oceans are now bringing about a dynamic coupling as seas of freedom
and of prosperity,” he said. “A ‘broader Asia’ that broke away geographical
boundaries is now beginning to take on a distinct form.”
This spatial understanding of the region combines the eastern theatre of
the Indian Ocean along with the Western Pacific, which includes the South
China Sea. Prime Minister Abe was prescient in his observations that this
region is now increasingly becoming the centre of gravity for the world’s
political, economic and cultural interests. It is a region that is rich in
natural resources, especially hydrocarbons, and is home to enormous
marine diversity. It is also the transit route for much of the world’s trade
and investment, and is host to nearly half of the world’s population.
The second development was the growing importance of the region to
both India and the United States. As early as in 2004, the Indian Maritime
Doctrine recognised “the shift in global maritime focus from the Atlantic-
45
V
75
Pacific combine to the Pacific-Indian Ocean region.” The US
acknowledged this formulation in 2010, when then Secretary of State
Hillary Clinton spoke in Honolulu about “expanding our work with the
Indian Navy in the Pacific, because we understand how important the
76
Indo-Pacific basin is to global trade and commerce.” At that time,
officials from both countries saw this is a positive development. In 2011,
the US Senate Committee on Armed Services noted that “with regard to
the Indo Pacific region, the committee notes that combined naval
exercises, conducted between the United States and India, have become a
vital pillar of stability, security, and free and open trade, in the Indo-Pacific
77
region.”
For India, the Indo-Pacific region fits squarely within its ‘Act East’ policy.
Its actions in peacefully settling its maritime disputes with Bangladesh, and
the greater rapprochement it has shown with Sri Lanka, are only some
signs of its intentions in the region. India is also keen on emerging as a
‘Net Security Provider’ in the Indian Ocean Region—an aspiration that is
78
detailed in its latest Maritime Strategy Document. India has considerably
enhanced its security and military assistance, disaster support and relief
operations to various island states such as Mauritius and the Seychelles,
and in the Bay of Bengal. For the US, the region is critical to maintaining
its preeminent position in Asian affairs. The South China Sea is the locus
of maritime trade and energy supply, and the Malacca Strait forms the
choke point for transit routes in the Indian Ocean Region. The United
States must also maintain a strong maritime presence to enforce its
security commitments to Taiwan, Japan and South Korea, and other
partners in the region.
The second development is undoubtedly tied to the third—China’s
expanding maritime actions in the Western Pacific, specifically the South
China Sea, and its regular forays into the Indian Ocean. Ever since the
Taiwan Straits crisis in 1996, Chinese strategy has emphasised on building
its maritime capacity to prevent US intervention in the South China Sea.
Part of these efforts have included attempted interference with American
operations along the first island chain, and acquiring air, naval and missile
capabilities to project power upto the second island chain. From here,
China intends to establish a permanent naval presence in the Indian
Ocean. Already, it has strategically acquired ports from Colombo to
The New India-US Partnership in the Indo-Pacific: Peace, Prosperity and Security
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Djibouti, allowing it to extend and maintain extensive maritime operations
in the region.
Exploring Indo-Pacific Synergies
he India-US nautical relationship has been riding a crest since the
signing of the Joint Strategic Vision document and renewed a
79
T10-year defence framework agreement in June 2015. In May
2016, the two sides held their first maritime security dialogue in the 2 + 2
format, following up with a Logistics Support Memorandum of
Understanding (LEMOA), a crucial agreement that allows the Indian Navy
80
and the US Navy to access logistics on a reciprocal basis. Washington’s
proposal for the joint development of India’s next-generation aircraft
carrier—in particular, the transfer of electromagnetic aircraft launch
system (EMALS) technology—has deepened strategic trust, generating
further momentum in maritime ties.
Following Prime Minister Modi’s visit to Washington in April 2017, there
are expectations in New Delhi of greater dividends from the bilateral
relationship. The United States’ recognition of India as a Major Defense
Partner has elevated India to the level of the US’ closest allies and
partners, raising hopes for high-technology defence sales. As a first step,
the US has cleared the transfer of Sea Guardian Unmanned Aerial
81
Systems, a “force multiplier” in the Indian Ocean. Meanwhile, a bilateral
“White Shipping” data sharing arrangement promises to enhance maritime
domain awareness, even as India’s support for the US’ observer status in
the Indian Ocean Naval Symposium (IORA) creates greater opportunity
for operational cooperation in the IOR.
The most encouraging sign has been the expansion of the Malabar naval
exercises. An abiding symbol of warming strategic ties between New
Delhi and Washington, Malabar has been the most wide-ranging
professional interaction of the Indian Navy with any of its partner navies.
Since Japans inclusion as a permanent member in 2015, Malabar has also
grown in scope and complexity, with the 2017 edition witnessing the
participation of two aircraft carriers, guided missile cruise ships,
destroyers, submarines, Poseidon P-8A / P-8i aircraft, as well as Japans
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new helicopter carrier JS Izumo. Increasingly, exercise-Malabar has
focused on the higher end of the naval operational spectrum, with special
emphasis on anti-submarine warfare, carrier strike group operations,
maritime patrol and reconnaissance operations, surface warfare, explosive
83
ordinance disposal, and helicopter operations.
Notably, the India-US maritime relationship has been a catalyst for New
Delhi’s developing relationships with Indo-Pacific states. While the Indian
Navy’s engagement with the Japanese self-defence forces has been on the
upswing, naval ties with Australia and Indonesia have also grown.
Meanwhile, India and Singapore have grown closer in the maritime
domain. New Delhi’s recent signing of a bilateral maritime agreement with
Singapore, including an understanding to share bases and provide logistics,
signals a deeper, more meaningful partnership in nautical-Asia, with
includes two geopolitically vital spaces, the Bay of Bengal and the South
China Sea.
Differences in Strategic Postures and Operational
Capabilities
t is in the wider Indo-Pacific region that Indian and American
interests are yet to fully converge. New Delhi has been less than
Ienthusiastic in joining the United States’ wider security project in
the Pacific littorals. Despite repeated proposals from Washington, to
jointly “protect shared spaces”, India has studiously refrained from
displaying naval vigour in the Western Pacific. While India’s political
leadership has been happy to support Indo-US cooperation in the Indian
Ocean, the diplomatic establishment has resisted the idea of joint-patrols
in the South China Sea. India’s rejection of Australia’s request to
participate in the Malabar exercises – wholeheartedly supported by the US
– too has revealed differences in New Delhi and Washingtons approach to
regional maritime security.
Indian observers have also noted the Trump administrations relative
indifference to the maritime geopolitics of South Asia. A year after the
new administration took office, the US remains preoccupied with the
challenges in Southeast and East Asia, seemingly unmindful of New
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Delhi’s key concerns in its near-littorals. This crucially includes China’s
growing footprint in Sri Lanka, Bangladesh and Myanmar, the Indian
Navy’s inability to track Chinese submarines in the Bay of Bengal, and the
84
strengthening China-Pakistan nexus in the Arabian Sea.
New Delhi realises that Washington’s real equities reside in the Western
Pacific, where senior US officials expect the Indian Navy to play a larger
security role. But the US’ dependence on China to help solve vexing
problems like North Korea gives New Delhi pause. With Washington at
least partially reliant on Beijing in dealing with Pyongyang, Indian
observers perceive the reduced American leverage in shaping Beijing’s
strategic choices in the Indian Ocean.
Indian analysts also complain that the Indian Navy’s cooperation with the
85
US is confined to the Eastern half of the Indo-Pacific region. At the
Western end of the Indo-Pacific, where India’s real security and economic
interests lie, maritime cooperation with the US remains limited. Even on
the critical issue of PLAN presence in the Indian Ocean, Indian and US
perspectives do not fully tally. For India’s strategic observers, the People’s
Liberation Army (PLA) Navy’s activities in the IOR – particularly PLA
submarine presence in South Asia—raises the worrisome prospect of a
Chinese “takeover” of India’s geopolitical space. While American
policymakers empathise with this view, they believe that Indian projections
of Beijing’s strategic domination of the Indian Ocean are significantly
overblown. It is China’s aggression in the Pacific Ocean, they suggest, that
is the real threat.
Some in India believe that the partnership in the Western Indian Ocean
has been feeble due to the US being mindful of Pakistans concerns, which
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was a critical partner for its operations in Afghanistan since 2001. The
dynamics seem to be changing with the Trump administration exhibiting
clear determination to encourage greater Indian role in Afghanistan and in
not allowing Pakistan’s sensitivities to have a veto on the potential of the
relationship.
Delhi’s inability to sign foundational pacts to enhance communications
and battle group networking—resulting in the stripping of tactical
interoperability aids in US-origin platforms (P8I and C-130J aircraft)
supplied to India—does little to raise American hopes for closer India-US
The New India-US Partnership in the Indo-Pacific: Peace, Prosperity and Security
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maritime relations. India’s use of voice and text commands to carry out
naval exercises with the US, Japan and Australia, observers say, conveys
the impression of “cultural familiarization, rather than a joint combat
87
drill”.
Advancing the Maritime Relationship
he key to a thriving maritime relationship is strategic empathy.
New Delhi must appreciate that the United States needs the
TIndian Navy for assistance in preserving strategic access in the
88
wider-Asian littorals. Indeed, Washington’s quest for innovative solutions
to long-standing security challenges in the Indo-Pacific requires a pooling
of strengths and capabilities to effectively police the regional maritime
commons. The Indian Navy must then assist its US counterpart in
securing access to nautical spaces, and also to strategically unify Indian
Ocean littorals, through a program of robust maritime diplomatic
engagements. If the IN can develop a strong set of nautical relationships
with its neighbours, it could then take the burden off the US Navy in key
areas of constabulary and benign security—including in tasks such as
survey salvage, disaster relief, and humanitarian assistance, which the
United States would prefer to outsource to the Indian Oceans principal
security provider.
Further, Washington must recognise the critical inventory gaps that
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prevent the Indian Navy from exerting influence in its near-seas. In the
absence of submarines and critical underwater detection equipment, the
IN is unable to keep track of PLAN subs in littoral-South Asia – the
primary theatre of Indian naval operations. To assist New Delhi in making
up for this capability deficit, the US government and American defence
firms must consider greater cooperation on proprietary technology
(including vital anti-submarine warfare know-how). It should be clear to
both sides that a stronger maritime partnership would follow the
enhancement of the Indian Navy’s surveillance and combat prowess.
Washington’s assistance in augmenting the Indian Navy’s theatre—ASW
and under-water surveillance capabilities—will go a long way in solidifying
the bilateral maritime relationship. For this, US policymakers will need to
think beyond security in the Western Pacific. Contrary to their beliefs, the
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50
so-called “tyranny of distance” does not preclude the establishment of
any permanent Chinese military presence in the Indian Ocean.
There is some evidence that the harmonisation of strategic outlooks may
already have begun. While the Pacific and Indian Oceans have traditionally
been seen to be separate bodies of water, India and the US increasingly
understand them as part of a single contiguous zone. More crucially, the
Indian Navy and the US Navy better appreciate each other’s strategic
objectives in this integrated domain, and are eager to accommodate
reciprocal concerns.
Encouraged by India’s efforts to expand its situational awareness in the
Indian Ocean and in search of greater operational coordination, the US
has been encouraging New Delhi to play a greater security role in the
Western Pacific. Trump administration officials’ repeated reference to
India’s critical role in securing the Western flank of the Indo-Pacific,
indicates that the US is keen to take its partnership with India many
90
notches higher. The United States and India have been cooperating to
leverage their combined strengths in securing the Asian commons. India’s
desire to be a “leading power” creates an imperative for the Indian Navy
to play a larger role in maritime-Asia. New Delhi, however, must shed its
inhibition for strategic naval presence in the Western Pacific. In doing so,
it must coordinate its deployments with the US, subtly balancing growing
Chinese influence in the region.
For its part, India has been increasingly active in integrating its maritime
neighbourhood – a key goal of US initiatives in the Indian Ocean. By
offering assistance to smaller states in setting up coastal radar and
automatic identification systems chains, aimed ultimately at establishing a
regional maritime surveillance network, India is gradually assuming a key
facilitating role in the Indian Ocean. Bolstering its maritime intelligence,
surveillance, and reconnaissance and antisubmarine warfare capabilities in
the South Asian littorals, the Indian Navy has been expanding its own air-
surveillance effort, pushing for the delivery of four additional P-8I aircraft
from the United States.
It is instructive that the core elements of Indo-US defence partnership
include the adoption of common platforms and weapons systems as well
as shared software and electronic ecosystems; closer cooperation on
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51
personnel training; and the convergence of strategic postures and
doctrines. These elements can realise their full potential only if the two
countries enable large-scale US-India data sharing, which will significantly
enhance interoperability between their two militaries. This, in turn, will be
possible only through the signature of the so-called Foundational
Agreements, which provide a legal structure for logistical cooperation and
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the transfer of communications-security equipment and geospatial data.
There are mixed indications that New Delhi may reexamine its stand on
two crucial foundational agreements—the Communications and
Information Security Memorandum of Agreement (CISMOA) and the
Basic Exchange and Cooperation Agreement for Geospatial Intelligence
(BECA) – even if the process takes some more time. To enable the
transfer of high-end military technology, Indian policymakers and
practitioners may be willing to accept Washington’s assertion that the pacts
do not infringe on India’s sovereign rights over high-technology defence
equipment purchased from the US. Presumably, the emphasis might be on
rephrasing the language of the agreements to address specific Indian
concerns over protocols governing actual equipment usage.
In balance, the India-US maritime relationship remains on an upward
trajectory. Despite temporary shocks, the overall outlook remains robust,
driven by a strong and enduring strategic convergence in maritime-Asia.
Now more than ever, there is a sense of common purpose and a shared
destiny. South Asia’s leading maritime power and the preeminent power in
the Indian Ocean seem to be working towards a functional pact to protect
them against the high-winds gathering in the east.
The New India-US Partnership in the Indo-Pacific: Peace, Prosperity and Security
52
NEXT STEPS FOR THE
INDO-US STRATEGIC
PARTNERSHIP
ased on the foregoing, the authors offer the following
recommendations for policymakers in Washington and New
BDelhi to advance the bilateral strategic relationship. Going
forward, India and the US will need to focus policy attention on five
specific areas.
A. Defence Trade and Technology
Defence trade is a prominent area of India-US strategic
convergence. While India has not traditionally figured on the US
“pyramid of trust” (never having fought alongside US forces as an
ally), it is now a designated “friend” of Washington. Having
accorded Major Defence Partner (MDP) status to India, US
policymakers have moved New Delhi up closer to the top of the
pyramid. This means that India is eligible to be a recipient of high-
grade US military capabilities and technologies. India must
capitalise on the bilateral platform for defence trade and
technology sharing with greater intent. India’s ‘Make in India’
initiative strengthens scope for co-production and co-development.
Policymakers in New Delhi and Washington must reconcile “Make
America Great Again” with “Make in India”. For its part, the
Trump administration fully supports everything the Obama
administration proposed to India, including exhaustive preparatory
work on India’s requirement for fighter aircraft and its connection
to ‘Make in India’. As the Heritage Foundation has argued, “an F-
16 line in India is better than shutting it down. If an Indian line
keeps 20 American suppliers in business, that’s better than zero.
54
VI
New Delhi, however, must look for ways in which to sustain the
momentum on the defence trade front.
Washington must be more willing to address New Delhi’s defence
inventory gaps by equipping Indian forces in the short run, and
help it build a defence manufacturing base in the longer run.
Priority military hardware and technologies, areas for joint
production, need to be identified. Pending sales — such as that of
Guardian RPVs — and proposals — such as the micro unmanned
aerial vehicle project — need to be expedited.
The matter of quality and subsequent liability of equipment made
in India through joint Indian-US ventures will also need to be
addressed. The hesitation of US companies in sharing proprietary
and sensitive technology is a concern that will need to be taken up
on a case-by-case basis.
It is time to start conversations on some over-the-horizon military
cooperation, such as on the fifth-generation fighter, nuclear
submarine, helicopter and aircraft carriers. There is a rare moment
of clarity in US and Indian policy circles on the importance of
each other in this region. This is important if the countries are to
act as “anchor of stability” in the Indo-Pacific.
B. Cooperation in Southeast Asia and Beyond: Focus on
Connectivity
There is a growing sense in Washington that India shares the
United States’ interests in maintaining stability in Afghanistan and
South Asia, with US policymakers increasingly vocal of their
preference for Delhi’s expanded role in Kabul’s security. India and
the US should improve their consultation on Afghanistan. New
Delhi must look for ways on which it could provide greater military
assistance for the stabilisation of Afghanistan.
Connectivity must animate the India-US relationship. China’s all-
embracing Belt and Road Initiative seems intent on excluding many
The New India-US Partnership in the Indo-Pacific: Peace, Prosperity and Security
55
powers that do not agree with Beijing’s view of regional order. It
creates an imperative for India and the US to forge a more
inclusive approach to the emerging Asian strategic
framework—one that is willing to accommodate all stakeholders,
including China.
The American vision of the Indo-Pacific Economic Corridor
supplements India’s Act East policy. India-US cooperation in
physical and soft infrastructure can, for instance, link cross-border
transport corridors; help create regional energy and digital linkages;
and facilitate people-to-people connectivity that encourages
education and skilling across this common space.
Washington and New Delhi must work together to create new
dialogues and bilateral mechanisms to facilitate this synergy. They
must also include other partners in the region, such as Japan and
Australia, and may even work towards establishing a Quadrilateral-
level consultation on connectivity.
A four-pronged strategy must form the bulk of any bilateral
cooperation in the region: First, highlight the importance of
norms, and ensure that even Chinese projects adhere to a rules-
based connectivity regime. Second, ensure that the market is
allowed to allocate resources and capital in a way that finds synergy
between various Indo-Pacific policies. Third, ensure that states in
the region have access to responsible finance mechanisms, allowing
them to reduce dependency on Beijing. Finally, ensure that any
Indo-Pacific connectivity strategy is not strictly bilateral like the
BRI, and places regional institutions at the forefront.
Washington and New Delhi must cooperate as “global partners”,
with US public and private investments funding projects in Africa
with Indian expertise. The US could even consider joining Japan
and India in making the Asia-Africa growth corridor a reality.
The US should nurture burgeoning regional partnerships between
Japan, South Korea, Australia, and India, as these countries work
towards building consultative and collective Asian frameworks.
The New India-US Partnership in the Indo-Pacific: Peace, Prosperity and Security
56
C. Maritime Freedoms and Littoral Security
There is enormous potential for India-US defence cooperation in
the Indo-Pacific Region. The annual Malabar exercise, which now
formally includes a third partner, Japan, must aim for greater
coordination and expand interoperability. The India-US Logistics
Exchange Memorandum of Agreement (LEMOA) must be
operationalised to create functional logistic avenues, and the white
shipping agreement must be leveraged to promote full-spectrum
domain awareness.
Besides its potential to promote joint stewardship of the commons
for freedom of navigation and unimpeded trade, India-US
maritime security cooperation is also critical in combating maritime
crime (such as piracy, armed robbery at sea, and maritime
terrorism) and the preservation of the natural
environment—resources, ecosystems, and biodiversity. There is a
need to focus on the likelihood of an increased number of
extreme weather events in the Indian Ocean Region (IOR). Joint
naval operations must hone skills and encourage sharing of best
practices to respond quickly and effectively with human assistance
in disaster relief and during humanitarian crises.
An expanded bilateral maritime partnership will help create a
resilient regional architecture that is not dependent on one sole
guarantor of stability, nor threatened by unilateral action. This
partnership must involve transfer of technologies to further India’s
capacity in the Indian Ocean Region; explore new forms and
formats of joint exercises and naval drills, such as anti-submarine
warfare and maritime domain awareness missions; and encourage
support for Indian leadership as “force for stability” and a net
security provider in the IOR.
Thus far, the India-US maritime relationship does not extend to
the Western end of the Indo-Pacific region. There is a sense in
New Delhi that the US is too focused on the maritime geopolitics
of the South China Sea and East Sea, as a consequence of which
maritime cooperation in the Indian Ocean is limited to the Eastern
The New India-US Partnership in the Indo-Pacific: Peace, Prosperity and Security
57
theatre. While the US Navy must collaborate with the Indian Navy
in the Western Indo-Pacific, the latter must prepare to play a more
active role in the Pacific littorals.
India has been increasingly active in integrating its maritime
neighbourhood – a key goal of US initiatives in the Indian Ocean.
The Indian Navy must cooperate with the US Navy to bolster
intelligence, surveillance, and reconnaissance missions in the South
Asian littorals.
To realise the full potential of the defence partnership, India and
the US must enable large-scale US-India data sharing, significantly
enhancing interoperability between their two militaries. This will be
made possible only through India’s acceptance of Foundational
Agreements, which provide a legal structure for logistical
cooperation and the transfer of communications-security
equipment and geospatial data.
Both sides need a focused discussion on the fine-print of the
foundational agreements. While Indian policymakers and
practitioners may be willing to accept Washington’s assertion that
the foundational pacts (CISMOA and BECA) do not infringe on
India’s sovereign rights over high-technology defence equipment
purchased from the US, they may not be willing to accept the
agreements without specific clauses that address Indian concerns
over protocols governing actual equipment usage.
The US must assist India in finding remedies to its anti-submarine
deficit in the Indian Ocean. Washington’s assistance in augmenting
the Indian Navy’s theatre-ASW and under-water surveillance
capabilities, as well its power-projection capabilities will further
solidify the maritime relationship.
The Indian Ocean Region comes under the area of responsibility
of three US commands, thereby creating a structural impediment
for the India-US naval partnership. Washington needs to address
concerns that the US lacks an integrated geopolitical approach to
the Indian Ocean.
The New India-US Partnership in the Indo-Pacific: Peace, Prosperity and Security
58
D. Blue Economy
India and the US must promote a market-driven blue economy as a
framework for growth and prosperity in the Indo-Pacific, home to
bountiful hydrocarbon, mineral, and food resources, as well as
burgeoning coastal populations. The two sides must seek
cooperation in marine research and development, to promote
shared knowledge hubs, and share best practices.
New Delhi and Washington must support regional initiatives in the
Indo-Pacific to explore new investment opportunities in maritime
economic activities and industries, such as food production and
coastal tourism. India must seek US direct investments in identified
coastal economic zones and the Sagarmala initiative, and US
participation in regional groupings like the Indian Ocean Rim
Association, where it is currently a Dialogue Partner.
The US could support India in creating resilient regional
architecture in the Indo-Pacific that not only hinges on the
provision of security, but also on the advancement of an
environment that generates equitable and stable economic growth
in regional economies.
Following their extensive, official talks on promoting sustainable
ocean economies for the first time in January 2017, India and the
US must work together for coastal and marine protection,
sustainable marine resource management, and possible joint
exploration of exclusive economic zones. Emphasis must also be
given to maritime diplomacy, energy security, marine information
and communication technologies, and maritime connectivity.
E. Digital Connectivity, Trade, and Technology
The India-US partnership must be focused on the collaborative use
of digital technologies as a springboard to expand digital trade as
well as address common security concerns about global digital
interaction. Prime Minister Modi’s Digital India program has the
The New India-US Partnership in the Indo-Pacific: Peace, Prosperity and Security
59
potential of increasing India’s GDP by 20-30 percent by 2025.
American companies could help New Delhi increase digital
penetration and deliver last-mile digital connectivity in the country.
India-US bilateral cooperation in using the digital as a tool for
economic development and empowerment can be the template to
connect the three billion unconnected in other developing
countries in the Indo-Pacific, where there is an unprecedented
expansion in the digital economy and internet users. Washington
and New Delhi can propose a set of ‘Digital Norms for the Indo-
Pacific’ that can be operationalised under various joint initiatives.
Washington and New Delhi must explore creating a digital ID
ecosystem for South Asia built along the lines of India’s Aadhaar
initiative. India and US bilateral cooperation in cyber security can
also play a role in advancing propositions that can be adopted in
the broader Indo-Pacific region, which is ripe for ransomware and
distributed denial of service attacks, as well as ‘cyber jihad.’
As digital norms are institutionalised, India and the US must use
the opportunity to build and subsequently provide a model
working relationship for bilateral information sharing and data
regulation, such as through Mutual Legal Assistance Treaties. India
and the US interacting on questions of cross-border data, data
localisation, global digital trade paradigms can help steer norm-
making in the digital sphere towards a solution that responds to
interests of both developed and developing countries while
promoting a cyberspace environment that is open, reliable,
interoperable, and secure.
The New India-US Partnership in the Indo-Pacific: Peace, Prosperity and Security
60
The New India-US Partnership in the Indo-Pacific: Peace, Prosperity and Security
61
ENDNOTES
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egy_ Document_25Jan16.pdf.
79. “India, US ink new defence framework accord,” The Economic Times, 3 June 2015,
The New India-US Partnership in the Indo-Pacific: Peace, Prosperity and Security
67
https://economictimes.indiatimes.com/news/defence/india-us-ink-new-defence-
framework-accord/articleshow/47532025.cms.
80. “Maritime Security Dialogue: India-US add another layer to defence cooperation,”
Firstpost, 17 May 2016, http://www.firstpost.com/world/india-us-maritime-
security-dialogue-defence-south-china-sea-manohar-parrikar-ashton-carter-
2784588.html. See also, “India, US sign key defence pact to use each other's bases
for repair, supplies,The Indian Express, 31 August 2016,
http://indianexpress.com/article/india/india-news-india/manohar-parrikar-signs-
key-logistics-defence-pact-with-us-3004581/.
81. As Prime Minister Narendra Modi Meets Donald Trump, US Clears $2 Billion
Drone Deal,” NDTV, 27 June 2017, at https://www.ndtv.com/india-news/prime-
minister-narendra-modi-meets-donald-trump-us-clears-2-billion-unmanned-
guardian-drone-deal-1717320.
82. “Warships, subs of India, US, Japan sail out to Bay of Bengal for Malabar,” The
Times of India, 13 July 2017,
http://economictimes.indiatimes.com/articleshow/59583027.cms?utm_source=c
ontentofinterest&utm_medium=text&utm_campaign=cppst.
83. Ibid.
84. Asia's maritime-quad might prove elusive,” The Mint, 9 November 2017,
http://www.livemint.com/Opinion/iC9DoHYGREMDTXDx0jnKCM/Asias-
maritimequad-might-prove-elusive.html.
85. “Why India Should Be Wary of the Quad,” The Wire, 13 December 2017,
https://thewire.in/196540/india-us-japan-australia-quadrilateral-alliance/.
86. Samir Saran and Paul Kapur, “How India and the US can lead in the Indo-Pacific,”
The Lowy Interpreter, 18 August 2017, https://www.lowyinstitute.org/the-
interpreter/how-india-and-us-can-lead-indo-pacific.
87. Indian Navy odd one out in Quad, The Quint, November 22, 2017 at
https://in.reuters.com/article/india-usa-quad/indian-navy-the-odd-man-out-in-
asias-quad-alliance-idINKBN1DM0U7
88. “New player in East Asia: Modi must fill the gaps in Trump's Indo-Pacific vision,
The Times of India, 9 December 2017,
https://blogs.timesofindia.indiatimes.com/toi-edit-page/new-player-in-east-asia-
modi-must-fill-the-gaps-in-trumps-indo-pacific-vision/.
89. C. Uday Bhaskar, “Address inventory gaps to make Indian Navy a credible
maritime force,” The Hindustan Times, 16 November 2017,
http://www.hindustantimes.com/opinion/address-inventory-gaps-to-make-
indian-navy-a-credible-maritime-force/story-LNTyVw8IGskht0E0wzOQIL.html.
90. US Secretary of State Rex W. Tillerson, op. cit.
91. Samir Saran and Paul Kapur, op. cit
Abhijit Singh
Abhijit Singh is a Senior Fellow at the Observer Research Foundation
where he heads the Maritime Policy Initiative. He has written
extensively on security and governance issues in the Indian Ocean
and Pacific littorals. A former naval officer, Singh served on frontline
Indian warships and was involved in the writing of India's maritime
strategy (2007). He is editor of two books on maritime security —
'Indian Ocean Challenges: A Quest for Cooperative Solutions' (2013) and
'Geopolitics of the Indo-Pacific' (2014).
Aparna Pande
Aparna Pande is Research Fellow & Director of Hudson Institute's
Initiative on the Future of India and South Asia as well as Fellow,
Center on Islam, Democracy, and the Future of the Muslim World.
Her primary field of interest is South Asia with a special focus on
India, Pakistan, Afghanistan, and Foreign and Security Policy. Pande's
second book, 'From Chanakya to Modi: Evolution of India's Foreign Policy'
(Harper Collins India) was published in July 2017.
Jeff M. Smith
Jeff M. Smith is a Research Fellow at The Heritage Foundation's
Asian Studies Center, focusing on South Asia. He previously served
as Director of Asian Security Program at the American Foreign
Policy Council. Smith has testified as an expert witness before
multiple congressional committees, served in an advisory role for
several presidential campaigns, and regularly briefs officials in the
executive and legislative branches on matters of Asian security. He is
the author of 'Cold Peace: Sino-Indian Rivalry in the 21st Century'
(Lexington Books, 2014); and the author and editor of the
forthcoming 'Asia's Quest for Balance: China's Rise and Balancing in the
Indo-Pacific' (Rowman and Littlefield, 2018).
The New India-US Partnership in the Indo-Pacific: Peace, Prosperity and Security
AUTHORS
68
The New India-US Partnership in the Indo-Pacific: Peace, Prosperity and Security
69
Samir Saran
Samir Saran is Vice President of the Observer Research Foundation,
New Delhi. He spearheads ORF's outreach and business
development activities. He curates Raisina Dialogue, India's annual
flagship platform on geopolitics and geo-economic, and chairs CyFy,
India's annual conference on cyber security and internet governance.
His areas of interest include global governance, climate change and
energy policy, global development architecture, cyber security and
internet governance, and India's foreign policy. Saran is the author of
'India's Climate Change Identity: Between Reality and Perception' (Palgrave
2016).
Sunjoy Joshi
Sunjoy Joshi is Chairman of the Observer Research Foundation. He
has written extensively on energy policy, climate change, development
studies, and India's foreign policy. Before joining ORF, Joshi served
in the prestigious Indian Administrative Service beginning in 1983. In
this capacity, he handled oil and gas exploration as Joint Secretary in
the Ministry of Petroleum and Natural Gas and was the
Government-nominated Director on the Boards of ONGC, OVL,
OIL and MRPL.
Walter Lohman
Walter Lohman is Director of The Heritage Foundation's Asian
Studies Center. Lohman is a policy expert focused principally on
Southeast Asia, but also broader Asia policy including relations with
America's allies in Japan, South Korea and Australia. He previously
served for four years as senior vice president and executive director
of the US-ASEAN Business Council, and advised senior members of
government on East Asian Affairs. Lohman is also currently an
adjunct professor at Georgetown University.
The New India-US Partnership in the Indo-Pacific: Peace, Prosperity and Security
70
Home to about 40 percent of the world’s population, rare mineral resources,
and vital trade routes, the Indo-Pacific is fast emerging as the most dynamic
region of the 21st century. Even as states in the region realise this potential,
they remain caught in what are arguably the most important geopolitical shifts
in the world since the end of the Cold War—including the rise of China, and the
reduced appeal of Western institutions. Consequently, the Indo-Pacific has
become the focal point for great-power competition on issues such as
connectivity and maritime security. China is well-placed to influence an
emerging regional architecture, with its ambitious Belt and Road Initiative and
its growing maritime prowess. Faced with this reality, an Indo-US partnership
is capable of catalysing the development of democratic norms, strong regional
institutions, and a rules-based order that can help shape a peaceful,
prosperous and secure Indo-Pacific.
20, Rouse Avenue Institutional Area,
New Delhi - 110 002, INDIA
Ph. : +91-11-43520020, 30220020.
Fax : +91-11-43520003, 23210773.
E-mail: contactus@orfonline.org
Website: www.orfonline.org
ISBN: 978-93-87407-54-1
Article
As BRICS advances into its second decade of existence, it transitions from a multilateral alignment to bilateral arrangements among the five members. This ‘bi-lateralization’ of BRICS expands the ‘menu’ of the BRICS ‘multilateralism à la carte’ by allowing members to limit cooperation when their interests diverge and to benefit from collective action through BRICS when their interests converge. This paper argues that, from the standpoint of countries like Brazil, the India–China border dispute and broader competition in the Indo-Pacific demonstrate the ‘bi-lateralization’ of intra-BRICS relations as they thwart the development of a common narrative on issues like global health, security and trade. Contrarily, the bi-lateralization of BRICS also gives members more flexibility as they manage various domestic and international challenges, which is crucial for the grouping’s survival. The experience of the BRICS-led New Development Bank (NDB) illustrates how the five countries can still cooperate as a coalition in pursuit of common objectives such as sustainable development and infrastructure. The lack of robust mechanisms to realize these objectives, however, raises questions about NDB’s capacity to help BRICS to cooperate more like a community.
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Great powers have invested in order-building projects with competing vision of political values and ideologies. How the Coronavirus (COVID-19) pandemic shapes the balance of power and order are debated. The pandemic arrived in the midst of Sino-US strategic contestation, a crumbling European project, de-globalisation and contested economic governance architecture. While the pandemic exacerbated Washington abdicating leadership role, Beijing also has alienated itself from the followers of rules based order. It has sharpened the clash of rhetoric, narratives, and perceptions. The pandemic will reorganise the international system and power structures. Situating the Indo-Pacific project in this backdrop, this article critically analyses the debates, discourses and nuanced divergences that are shaping the Indo-Pacific puzzle in the power corridors of Washington, Tokyo and Delhi, in addition to mapping Beijing’s approach to Indo-Pacific. The article evaluates the contrast in their respective visions of order, China strategy, ASEAN centrality and multilateral free-trade regimes. But these subtle departures have not restricted major Indo-Pacific powers to weave a strategic web of democracies and pursue a win-win issue-based multi-alignment on matters of mutual strategic interests. With new realities in play, the India-US-Japan triangle will feature as one of the key building blocks of Indo-Pacific to deliver on the shared responsibility of providing global public goods. JEL Codes: F5, K3
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The prevalent view in the economics literature is that a high level of infrastructure investment is a precursor to economic growth. China is especially held up as a model to emulate. Based on the largest dataset of its kind, this paper punctures the twin myths that (i) infrastructure creates economic value, and that (ii) China has a distinct advantage in its delivery. Far from being an engine of economic growth, the typical infrastructure investment fails to deliver a positive risk-adjusted return. Moreover, China’s track record in delivering infrastructure is no better than that of rich democracies. Investing in unproductive projects results initially in a boom, as long as construction is ongoing, followed by a bust, when forecasted benefits fail to materialize and projects therefore become a drag on the economy. Where investments are debt-financed, overinvesting in unproductive projects results in the build-up of debt, monetary expansion, instability in financial markets, and economic fragility, exactly as we see in China today. We conclude that poorly managed infrastructure investments are a main explanation of surfacing economic and financial problems in China. We predict that, unless China shifts to a lower level of higher-quality infrastructure investments, the country is headed for an infrastructure-led national financial and economic crisis, which is likely also to be a crisis for the international economy. China’s infrastructure investment model is not one to follow for other countries but one to avoid.
A Strong India-US Partnership Can Anchor Peace, Prosperity & Stability across the World
  • Prime Minister
  • Narendra Modi
Prime Minister, Narendra Modi, "A Strong India-US Partnership Can Anchor Peace, Prosperity & Stability across the World". Speech presented at the Joint Meeting of the US Congress, Washington D.C June 8, 2016, https://www.narendramodi.in/prime-minister-narendra-modi-addresses-jointmeeting-of-u-s-congress-in-washington-dc-484217
India's FDI inflows at a record $60.1 billion in 2016-17
  • Raj Kumar Ray
Raj Kumar Ray, "India's FDI inflows at a record $60.1 billion in 2016-17," Hindustan Times, 19 May 2017, http://www.hindustantimes.com/businessnews/india-s-fdi-inflows-at-a-record-60-1-billion-in-2016-17/story-7a8pt2u7e8IJttptDQcwhO.html.
Joint Statement during the visit of Prime Minster Narendra Modi to USA
  • India
  • Us
India-US Joint Statement during the visit of Prime Minster Narendra Modi to USA, June 2016.
Extreme events in the Indian Ocean Region
K.S. Rajagopal, "Extreme events in the Indian Ocean Region," The Hindu, 12 June 2014.
Modi Sees Big Role for India in Ensuring Global Stability
  • Jeremy Yong
  • Au
Yong, Jeremy Au, "Modi Sees Big Role for India in Ensuring Global Stability," The Straits Times, 9 June 2016, www.straitstimes.com/world/modi-sees-big-role-forindia-in-ensuring-global-stability.
The Case for Alliance
  • C Raja See
  • Mohan
See C. Raja Mohan, "The Case for Alliance," Carnegie India, 2 December 2015, carnegieindia.org/2017/09/14/case-for-alliance-pub-73106.
China's 'Pearls' Spook Indian Observers
  • Bruno Phillip
Bruno Phillip, "China's 'Pearls' Spook Indian Observers," The Guardian, 4 March 2010, www.theguardian.com/world/2010/mar/04/india-china.
China Readies $46 Billion for Pakistan Trade Route
  • Jeremy Page
Jeremy Page, "China Readies $46 Billion for Pakistan Trade Route," The Wall Street Journal, 16 April 2015, www.wsj.com/articles/china-to-unveil-billions-of-dollars-inpakistan-investment-1429214705.
When China Bullies Its Neighbors, India Gets More Muscular
  • Illaria Sala
Illaria Sala, "When China Bullies Its Neighbors, India Gets More Muscular," Quartz, 15 December 2016, qz.com/864961/when-china-bullies-its-neighborsindias-narendra-modi-gets-more-muscular/.