India's 'Look East' policy, which was an initiative to build stronger economic, strategic and cultural relations with the Asia-Pacific countries, was initiated during the prime-ministership of P.V. Narasimha Rao. It yielded great dividends and was continued by the successive governments led by Prime Ministers Atal Bihari Vajpayee and Manmohan Singh. As India-ASEAN relations gained momentum in the late 1990s and early 2000s, India became a full dialogue partner of the ASEAN in 1995, a member of the ASEAN Regional Forum in 1996, and a founder member of the East Asian Summit in 2005. India and ASEAN also became strategic partners in 2012. Presently, there exist 30 different dialogue mechanisms between the two, focusing on a diverse spectrum of subjects including foreign affairs, economy, environment and tourism.
India's 'Look East' policy was transformed into the 'Act East' policy in 2014, under the leadership of Prime Minister Narendra Modi. Multiple initiatives have been undertaken by both sides since then, with ministers, bureaucratic officials and the leaders of individual nations interacting regularly to rejuvenate the relations with renewed purpose. India and ASEAN view each other as natural allies in creating a liberal and inclusive regional order. They are active participants in the East Asia Summit (EAS), ASEAN Regional Forum (ARF), ASEAN Defence Ministers Meeting Plus (ADMM-Plus), and the Expanded ASEAN Maritime Forum (EAMF).
India-ASEAN strategic cooperation assumes greater significance against the background of an assertive and rapidly growing China. Beijing's territorial claims in the resource-rich South China Sea, a vital international maritime trade route, have generated considerable regional anxiety. China's rise as an economic giant and its robust economic ties with the ASEAN countries gives India enough reason to step up its collaborative efforts vis-à-vis ASEAN. It is necessary for both India and ASEAN to keep the China factor in mind and act accordingly to preserve a stable balance of power in the region.
An essential aspect of India-ASEAN partnership is economic cooperation. India's 'Look East' policy gained momentum after the creation of the India-ASEAN Free Trade Agreement in 2003. The ASEAN-India Free Trade Area (AIFTA) has been completed with the entry into force of the ASEAN-India Agreements on Trade in Service and Investments on 1 July 2015. This agreement reflects India's adherence to the vision of having a solid foundation for economic engagement with ASEAN.
The Asia-Pacific region today is spearheading the global economy in terms of growth and dynamism. The establishment of the ASEAN Economic Community (AEC) in 2015 was an innovative step towards greater regional integration, as it aims to consolidate Southeast Asia's diverse economies into a single market. The AEC is beneficial for the Indian economy as well, since it allows Indian companies to distribute products in the ASEAN region with lower costs and smooth procedures.
The ASEAN nations and India together consist one of the largest economic regions with total population of about 1.8 billion. ASEAN is currently India's fourth largest trading partner, accounting for 10.2 percent of India's total trade. India, on the other hand, is ASEAN's 7th largest trading partner. India's service-oriented economy perfectly complements the manufacturing-based economies of the ASEAN countries.
The Regional Comprehensive Economic Partnership (RCEP) agreement is expected to be finalised by the end of 2017, opening up great opportunities for India and the ASEAN countries. It is a mega-regional agreement being negotiated between the ten ASEAN members and their six FTA partners: Australia, China, India, Japan, New Zealand and South Korea. As of 2017, prospective RCEP member states account for 30 percent of the world's economy and a market of 3.4 billion people with a combined Gross Domestic Product (GDP) of US$21.4 trillion.
India and Southeast Asian countries share longstanding historical and civilisational ties. The impact of the cultural exchange is evident in religion, language, literature, beliefs, customs, cuisine, and architecture of the two regions. The cultural linkages have evolved over the centuries through the exchange of people, values, education, trade and commerce. The large Indian diaspora in many of the Southeast Asian countries, especially Malaysia and Singapore, helps strengthen diplomatic, economic and security relations between India and ASEAN. The Indian diaspora comprise an important instrument of India's soft power and they facilitate greater interaction between the two regions.
In spite of considerable progress made over the last 25 years in India-ASEAN ties, there is considerable scope for further growth. The Asia-Pacific is one of the most dynamic regions of the world today, and it is necessary for both India and the ASEAN countries to keep contributing to the shaping of the so-called 'Asian century'. Formidable security challenges remain, and the two sides must think strategically to increase cooperation for a favourable balance of power that would ensure regional stability.
India needs to do a more convincing job as a beneficial strategic partner of the ASEAN by boosting its domestic economic reforms agenda, enhancing connectivity within the region, and increasing its presence in the regional institutions. India and the ASEAN nations have common aspirations that resonate with a peaceful and prosperous regional security architecture. Deeper engagement should be undertaken by both sides if the full potential of this partnership is to be realised. As some of the finest minds of ASEAN and India come together for the ninth edition of the Delhi Dialogue, how to chart the course of this important partnership for the next 25 years should be high on the agenda.
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(Harsh V. Pant is Head, Strategic Studies at Observer Research Foundation, New Delhi and Professor of International Relations at King's College London. Avantika Deb is a Research Assistant at Observer Research Foundation, New Delhi.)
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