India's Modi Looks East—To the Asia-Pacific

India is attempting to build partnerships with key states in the Asia-Pacific, with a particular focus on Japan, Vietnam, Australia and ASEAN. 

The U.S.-India-Japan trilateral took place in New Delhi this past week, capping off a big year in foreign policy for India’s new government. With an eye on China, India has in recent years made a concerted effort to carve out a more serious role for itself in the Asia-Pacific. Under Modi, India has invested particular effort in strengthening ties with its East and Southeast Asian partners. Last week’s trilateral is a clear example of India’s growing role in the evolving strategic dynamics of the Asia-Pacific.

Despite the preelection assumption that the BJP government would prioritize domestic reform, Prime Minister Modi has devoted an unexpected level of attention to foreign policy. Achieving an outright parliamentary majority, the 2014 elections delivered the BJP the largest electoral mandate of any Indian government since 1984. This parliamentary strength will give the Modi government a historic opportunity to enact significant policy change, including in foreign affairs and security.

The Modi government’s early foreign-policy decision making hinted at a prioritization of India’s own South Asian neighborhood. In an unprecedented move, Modi invited the heads of state of SAARC countries, plus Mauritius, to his inauguration. Soon after, both Modi and External Affairs Minister Sushma Swaraj made their first international visits to South Asia (Bhutan and Bangladesh respectively). Modi is aware that a stable environment in South Asia is crucial to ensuring India’s own security and economic growth. However maintaining stability in South Asia does not need to come at the expense of broader global engagement, and Modi has indicated his government’s intention to pursue a more ambitious foreign-policy agenda for India.

With the long-term economic and security benefits of closer engagement with the Asia-Pacific in mind, the Modi government is making particular effort to reach out to its East and Southeast Asian partners. India’s trade with North and Southeast Asia now represents about a quarter of its total trade; outweighing that with the United States and European Union.[1] China has become India’s top trading partner, with a value of US $65 billion in 2013-2014.[2] Two-way trade with ASEAN member states has grown to approximately $74 billion, making its trade with the region as a whole even more significant than with China.[3] In recognition of the centrality of the institution, at this year’s India-ASEAN summit Modi announced that India’s long-standing Look East Policy would be upgraded to “Act East.” This is more than just a rebrand and signals India’s willingness to play a more active role in the region.

India has been actively pursuing closer engagement with the Asia-Pacific for over two decades, and has established significant economic, institutional and defense ties with the region. However, in recent years, much of India’s engagement has been driven by a policy of external balancing against China. While the economic aspects of the relationship have been positive, China’s increasingly assertive behavior on India’s border, combined with its enhanced presence in South Asia and the Indian Ocean, is raising concerns of perceived strategic encirclement.

India’s relations with China have long proceeded along two parallel economic and security tracks. High-level interactions have proceeded at an accelerated pace under Modi, and President Xi Jinping’s visit to India in September 2014 proved to be the first test of managing the cooperative and competitive elements of the bilateral relationship. While there was some success on the economic side, the visit was overshadowed by tensions along the disputed border in Ladakh, and the docking of a Chinese submarine in Colombo. Although it is unclear whether these actions were centrally directed, if so, they represented a significant misreading of the Modi government. Occurring between Modi’s first trips to Japan and the United States, the border incursion served only to reinforce the relevance of India’s strategy of balancing against China.

As such, India is attempting to build practical partnerships with key states in the Asia-Pacific, with a particular focus on Japan, Vietnam, Australia and ASEAN. Importantly, China’s assertiveness on maritime territorial disputes in the East and South China Sea and uncertainty over the United States’ role in the region are additionally prompting China’s neighbors to look to India to play a balancing role in the region. The United States has for some time also expressed a desire for a more prominent global role for India, and closer relations with the United States is likely to bring about a more concerted effort in carving out a serious role in the Asia-Pacific.