You are on page 1of 5

Paradigm shift of India from Look East to Act East Policy

Introduction
Prime Minister Narendra Modi embarked upon a 10 day bilateral tour on 12 Nov 2014.
He commenced the tour with Myanmar, where the 12 th India - Association of Southeast
Asian Nations (ASEAN) Summit and 9th East Asia Summits were scheduled at Nay Pyi
Taw on 12-14 Nov 2014.
PM Modi during this tour is scheduled to meet as many as 40 global leaders, including
pro-democracy leader of Myanmar, Aung San Suu Kyi and others from China, Germany,
Britain and South Korea and USA. During the next phase of his itinerary he would
further travel to Australia for G-20 Summit at Brisbane and also to Fiji islands.
As many as 25 bilateral meetings with different leaders, besides attending multilateral
summits, would be an explicit expression of Indias Act East Policy and Make in
India campaign being propagated by the Modi Government.
The overall aim of this bilateral tour will be to better connectivity, highlight and discuss
territorial, including maritime infringement, enhance trade and increase cooperation with
the ASEAN and East Asian countries.
Why is Myanmar Significant to India?
Myanmar shares a 1600 km border with India including a maritime border in the Bay of
Bengal. It is the gateway to ASEAN and lies at the intersection of India and Chinas
clashing interests for achieving regional dominance. It is also significant from the point
of view of economic transformation of our NE states.
China was the only country that continued to maintain economic and diplomatic
relations with Myanmars Military Junta. The Military Rule in the country lasted from
1988 to 2010. The world community, including India, during this period had severed all
ties with Myanmar.
After Myanmar progressed towards democratic reforms and in the by elections of April
2012, the NLD led by Aung San Suu Kyi had a landslide victory giving strength to the
democratic reforms.

As the democratic reforms gathered momentum relationship between India and


Myanmar improved. President Thein Sein visited India in October 2011 and Indian PM
Manmohan Singh visited Myanmar in May 2012.
During this visit 12 agreements were signed in varied fields of cooperation, including
security and countering insurgency which is a scourge for both the countries.
Myanmar is very rich in natural gas and mineral resources, and after the country has
displayed its earnestness towards democracy, most countries, including USA, have
commenced forging better diplomatic relations with Myanmar
Presently, China is Myanmars largest trading partner. However, it appears that
Myanmar wants to restrict its economic dependence on China. It is supporting the
cause of ASEAN countries who are voicing their opinion against Chinas unprovoked
interference and expansion of its maritime borders into the South China Sea.
India is stepping up its momentum to improve economic ties with Myanmar. The trade
between the two nations has gone up from 12 million in 80s to 2 billion. A number of
Indian companies have taken the initiative to commence establishing their base in
Myanmar. Some prominent names include, ONGC Videsh, Tata Motors, Century Ply,
Essar energy, Ranbaxy, CIPLA, Apollo, etc.
Top companies are looking for investment in telecom, energy and Aviation sectors.
Seven Indian companies are amongst 59 companies shortlisted by Myanmar for off
shore Gas block allocation.
India has also provided $500 million as credit to Myanmar for a host of infrastructure
development and capacity building projects.
Importance of ASEAN in Indian Context
The Association of Southeast Asian Nations (ASEAN) was formed on 08 August 1967. It
is a political and economic organisation consisting of ten countries of South East Asia,
and was originally formed by Indonesia, Malaysia, the Philippines, Singapore and
Thailand. Later, the membership was further extended to Brunei, Cambodia, Laos,
Myanmar and Vietnam.
ASEAN Summit is held twice a year to discuss and resolve political, economic and
regional issues. Meetings with other countries, outside of the bloc are also held during
the ASEAN Summit to promote external relations.

Bilaterally, ASEAN maintains strategic relations with Australia, Canada, and the
Peoples Republic of China, the European Union, India, Japan, the Republic of Korea,
New Zealand, the Russian Federation, and the USA.
ASEAN as an entity ranks as the sixth largest economy in the world, behind the US,
China, India, Japan and Germany.
ASEAN members together with the groups six major trading partners Australia,
China, India, Japan, New Zealand and South Korea began the first round of
negotiations on 2628 February 2013 in Bali, Indonesia, on establishment of the
Regional Comprehensive Economic Partnership.
In 2009 India signed a Free Trade Area Agreement with ASEAN and it gave a huge a
fillip to trade in the region. Today, the Indo-ASEAN trade stands at $80 billion.
With the institutional framework in place and the Modi governments commitment and
focus towards enhancing trade, it is expected that the trade with ASEAN will cross $100
billion by the end of next year and the figures will be doubled by 2025.
The envisaged highway (under construction) and rail connectivity to energy giants like,
Nepal and Myanmar and further to Thailand, will improve people to people contact, thus
enhancing the sphere of economic cooperation and interdependence.
ASEAN Economic Community (AEC) is likely to be in place by 2015, which will
promote regional economic integration. The key characteristic of AEC will be single
market and production base and a competitive economic region, which would be fully
integrated into the global economy.
Hence, ASEAN region will allow free movement of goods, services, investment, skilled
labour, and freer flow of capital.
The highly underdeveloped NE States of India, which lie at the gateway to a region
offering unlimited economic opportunities, will witness an economic transformation.
Most of the ASEAN countries and Japan are projecting a tough stance towards Chinas
aggressive design of unlawfully encroaching upon land and maritime territories of other
countries. It is being increasingly felt that the monopoly and expansionism of Chinas
military might can only be checked through a collective stand.
In order to limit Indias regional dominance China has adopted a policy of String of
Pearls to isolate and intimidate India by expanding its area of influence around Indian
territorial extremities.

Hence, forming a strategic partnership with the anti-China camp will largely weaken
Chinese aggressive posture. This is perhaps the strongest reason for India to
relentlessly pursue its Look East policy.
East Asia Summit (EAS)
East Asia Summit(EAS) is a pan-Asian forum held annually by the leaders of 18
countries (ASEAN plus 08 countries) in the East Asian region, with ASEAN in a
leadership position.
Membership of EAS was initially all 10 members of ASEAN plus China, Japan, South
Korea, India, Australia, and New Zealand, but expanded to include the United States
and Russia in 2011.
A meeting of the EAS usually coincides with the ASEAN Summit. The 9 th East Asia
Summit was held on 13 Nov 2014. The prominent leaders that attended the Summit
included, President of USA, Barak Obama, Chinese Premier, Li Keqiang, Russian Prime
Minister, Dmitry Medvedev, South Korean President, Park Geun-hye and Indian Prime
Minister, Narendra Modi
Broadly, issues pertaining to trade, energy, security and regional community building
were discussed. The major issues that were discussed are given below:
South China Sea Dispute
A territorial dispute in the South China Sea, which is of tremendous strategic importance
to everyone, was discussed to find a solution through amicable dialogue. China and
ASEAN agreed to actively carry out consultation to reach, on the basis of consensus
and at an early date, a Code of Conduct in the South China Sea.
Tackling Ebola
It was highlighted that Ebola possessed a global threat to peace and security and relief
assistance needed to help fight the deadly virus in the hardest-hit West Africa nations,
where nearly 5,000 had died. Leaders from Southeast Asian nations looked at means to
seek technical assistance from the World Health Organization to help detect and
respond to public health threats.
Voice Against Islamic State Threat
Participants reiterated their support and efforts required for restoring law and order
inside Iraq that was struggling with the threat of countering the Islamic State group.

They called on Iraq and international partners to ensure the protection of civilians and
access to humanitarian assistance for those affected by the conflict. They demanded
the immediate, safe and unconditional release of all those who are kept hostage by the
group or associated individuals and entities.
Regional Comprehensive Economic Partnership
ASEAN plus 08 countries agreed to conclude the final negotiations to form the RCEP by
end of 2015. This alliance is likely to be created on the model of the European Union for
strengthening financial and fiscal cooperation with a special focus on improving Multilateralisation, which was expected to effectively relieve regional short-term liquidity
strains.
Once RCEP is created it would forge economic integration amongst member nations by
promoting trade and investment facilitation, accelerating interconnectivity, expanding
financial cooperation, stepping up poverty reduction cooperation, advancing maritime
cooperation as well as intensifying people-to-people exchanges.
Conclusion
Paradigm shift of India from Look East to Act East Policy is viewed as an affirmative
step by the South East Asian countries and displays a definitive eagerness and focus of
the Indian Government towards meaningful cooperation in trade and other bilateral
issues.
An effective and timely pursuance of this initiative will help India to take a lead to reap
out of proportion benefits from this region of unlimited opportunities.