China is steadily expanding its economic and political clout to the Eurasian and African regions with the ambitious Belt and Road Initiative. To counterbalance Beijing’s unhindered dominance and expansion in the region, reactionary initiatives have commenced under the leadership of several Asian powers bent on concocting international development projects of their own.
As of now, India is at the head of such efforts dedicated to countering the growing international ambitions of China. India along with Japan has developed a shared vision in the form of the Asia-Africa Growth Corridor (AAGC), also deemed: the ‘other’ New Silk Road.
Only days after President Xi’s Belt and Road Forum which was concluded in May, Indian PM Narendra Modi unveiled his and the Japanese PM Shinzo Abe’s vision for the region. For China, however the AAGC is a welcomed step. The Chinese media has come out in its defense, saying that such initiatives are encouraged by the Chinese government– as long as they do not restrict the BRI.
India-Japan relations have grown stronger due to enhanced cooperation in both economic and strategic spheres.
In July, India, Japan and the US held week-long trilateral naval exercises while the standoff between India and China over the Doklam plateau continued. Later on July 20, the momentous India-Japan civil nuclear agreement came into force. The pact was first signed in Tokyo on November 11 of last year during PM Modi’s visit to Japan. As part of the deal, six new nuclear reactors will soon be built for power generation.
On infrastructure too India will be seeking Japanese expertise. Japan has previously provided some assistance for the first phase of the Delhi Metro project. It is involved in several mega projects located in India, like the Delhi-Mumbai Industrial Corridor– work on which started a decade ago. According to media sources, the Mumbai-Ahmedabad bullet-train project will also soon launch during the Japanese Prime Minister’s expected visit to India this September (12-14).
In truth, Japan has played a major role in India’s developmental progress over the past decade and a half.
During the period 2000-2017 Japan invested more than $25 billion in different sectors in India; Japanese investment reached a total of $4.7 billion (an increase of 80% from the $2.6 billion of 2015-16). The Mizuho Financial Group has been tasked by the Japanese government to find more investment opportunities in India. So far it has identified sectors such as electronics, automobiles, energy, transportation and social infrastructure for a focused investing approach.
Japan is the third biggest investor in India. Added to that, Japan is known to have promised an investment of around $35 billion for the period 2014-19 to aid India’s manufacturing and infrastructure sector.
Of late, attention has shifted more specifically to Northeast India since it is being viewed as a gateway to increasing influence in Southeast Asia. Japanese investment and industrial parks are spread all across India, except for its eastern and northeastern regions. Now it seems outlook and priorities are changing.
With increased investment in the Northeast, especially towards infrastructure, India’s Act East Policy will also likely get some assistance. Other than that, the northeastern region is vital for India’s growth. A shift in focus towards the region will boost the pace of India’s development.
Converging strategic and security interests further align Japan and India as partners, which can in the long-run help the two secure a greater leadership role in the region. There is some likelihood that the US may choose to disengage from Asia-Pacific. In such a case Japan and India are concerned about China becoming more assertive, and so both seek to increase their collective capabilities to counter Beijing. Greater India-Japan cooperation in developing infrastructure and increasing connectivity with Southeast Asia through Myanmar will also signal to China that New Delhi’s approach to its northeast is not impacted or at all moved by Beijing—especially since Beijing refuses to acknowledge New Delhi’s concerns when it comes to CPEC.
The India-Japanese cooperative arrangement against Chinese influence will likely continue to grow in areas such as the South China Sea, Official Development Assistance (ODA), and infrastructure projects. Sustained cooperation between the two could create problems for China. This is important to consider.