, , , , , , , , , , , ,

Japan’s Shinzo Abe is in India for his third prime ministerial visit and it has the feeling of a meeting between friends rather than between the leaders of two major states. On the morning of his arrival, the Times of India ran an article by the Japanese prime minister in which he briefly outlined the history of India-Japan relations. Calling India a key international player and a natural partner who shared Japan’s values, Abe stated his belief that the two countries held the greatest potential of any bilateral relationship in the 21st century and declared his intention of “dramatically developing” the bonds between India and Japan. Not to be outdone in a show of warmth, the Indian prime minister tweeted, “India is all set to welcome its great friend & a phenomenal leader, PM @AbeShinzo. His visit will further deepen India-Japan relations.”

The rise of Abe in Japan and of Narendra Modi in India tells an interesting tale. Both men are nationalists leading nations that had retreated from the international spotlight during the Cold War, Japan via its pacifism and India through its non-alignment. Both nations have seen a generation pass and the younger crowd does not share the sentimentality of the old, though vast numbers yet remain unsure whether the risks of a more dominant global role are worth taking. Both leaders seek to remake their countries but face substantial opposition at home.

Relations between the two prime ministers go back to Modi’s chief ministerial days. This is the fifth meeting between the two men, the initial one being in 2007 when Abe was in his first term as prime minister. Modi and Abe connected well, or at least understood that they needed each other as the post-Cold War honeymoon drew to a close. Their personal chemistry has certainly helped Modi domestically: at a time when the West was trying to isolate him over the 2002 Godhra riots, Japanese firms made major investments in Gujarat’s infrastructure and industry. It is partly the successful outcome of these projects that propelled Modi to the top position in the country in May 2014.

Abe is in India for three days to attend the ninth annual India-Japan Summit talks. These talks broadly encompass three shared strategic interests: Indian infrastructural and economic development, civil nuclear cooperation, and defence ties. Expectations of the summit are big this year, something to top Japan’s promise in August 2014 to invest $34 billion in the Indian economy over five years. And Abe might deliver – it has been reported that the summit will likely see India and Japan seal an agreement for the latter to provide the former $15 billion at 0.5 per cent interest over 50 years to construct India’s first high speed rail line connecting Bombay to Amdavad. India is expected to adopt Japan’s Shinkansen technology and invest at least 30 per cent of the soft loan back into the Japanese economy. Construction is expected to start in 2017 and service by 2024; it has even been suggested that the line might, at a later date, be extended to Delhi as part of India’s Diamond Quadrilateral scheme to link its four metropoles with 10,000 kms of track. Besides this big ticket item, Japan has taken a role in developing the Amdavad and Madras metro projects and is negotiating its involvement in several highway undertakings, airport construction, industrial townships in Tumkur, Ghilot, Mandal, and Supa, and other infrastructural ventures.

An issue that has received less attention in the press is the Comprehensive Economic Partnership Agreement (CEPA) between the two nations. For several reasons, the full potential of this agreement has not been realised and the Indian and Japanese delegations would do well to ponder this. India is eager to enter the services sector in Japan, not just in information technology; meanwhile, it wishes Japan to give Indian Small and Medium Enterprises a closer look. The individual transactions may not be as headline worthy as nuclear cooperation or bullet trains but the impact over the entire economy will be greater. As India continues to grow and develop into a manufacturing hub as well, its markets promise to revitalise a flagging Japanese economic story.

While there are few hurdles on the economic front, civil nuclear cooperation is much more complicated. The Indo-US nuclear deal in 2008 readmitted India to international nuclear trade circles after four decades of nuclear apartheid and the South Asian country has since concluded several agreements for supplies of uranium for its small fleet of nuclear reactors. It had been hoped that Japan would also promptly begin to engage in nuclear commerce with India but that has not been the case. Tokyo has strict policies governing nuclear commerce, and one of them prohibits any such relations with a country that is not a member of the Non-Proliferation Treaty. Delhi will not sign the NPT as a non-nuclear weapons state and allowing it to join as a nuclear weapons state will in all likelihood mean the collapse of the international non-proliferation regime. Over the years, India has worked to persuade Japan of its trustworthiness and it is rumoured that Abe is closer to accepting the Indian view.

Truth be told, the value of a nuclear agreement between the two countries has been blown out of proportion. This is entirely because of the symbolic significance India has placed on international recognition of its nuclear credentials as a safe and reliable state. However, even if Abe and Modi were to be able to come to an agreement on this issue, it is unlikely that India will gain anything owing to its unique interpretation of nuclear liability. Japan has become an important manufacturing node in the international nuclear supply chain with major nuclear vendors in France and the United States depending upon vital components from the island. Yet the Civil Liability for Nuclear Damage Act (CLNDA) has brought India’s nuclear renaissance to a screeching halt and GE has refused to enter the country’s nuclear sector. Westinghouse has been silent too and Areva has slowed down its activities in Jaitapur, awaiting clarification on some of the problematic clauses of the CLNDA. If Modi successfully closes a nuclear deal with Abe, the only possible benefit to India in the near future is access to the high quality forging of reactor pressure vessels by Japan Steel Works. This will not bring back the foreign vendors but will at least indigenous nuclear industry the option to accelerate its expansion.

The third leg of the India-Japan relations triad is defence ties. This is a difficult subject for Japan: since World War II, the country has been avowedly pacifist – albeit under a US nuclear umbrella – and has abjured from any military activity outside Japan’s boundaries. Tokyo also forbade itself from selling defence equipment to other countries, even allies. It is only recently that there has been a thaw in this position: in 2011, Abe managed to pass several amendments to Japanese law that now allow him to engage in defence trade. This allowed Japan’s ShinMaywa to respond to Delhi’s Request For Information for nine amphibious aircraft capable of search and rescue operations, radar surveillance, and transportation of cargo. India and Japan set up a Joint Working Group in 2013 to explore the possibility of manufacturing the US-2 ShinMaywa together. Though a new era has begun for the Japanese defence industry, it is still early days and Abe faces strong domestic opposition to his reforms. Even an agreement on joint manufacture of the US-2 will not herald a rapid expansion of Indo-Japanese defence trade in the near future. However, such a deal is to be welcomed as a step in the right direction.

It cannot be ignored that the urgency motivating closer relations between two of Asia’s largest economies is the mutual perception of the threat of a more powerful and assertive China. Both Delhi and Tokyo have looked on with concern as Beijing strengthened its military on the back of a booming economy over the last two decades. China’s show of muscle in the South China Sea, its noxious relations with Pakistan, the quest for assets around the Indian Ocean, and the rapid modernisation and expansion of its military have not only pushed the nations of Southeast Asia together but also raised warning flags for the United States. However, neither Delhi nor Tokyo wish to antagonise Beijing too much just yet for both have substantial economic relations with their troublesome neighbour. An open and aggressive alliance is to neither country’s benefit, at least just yet, and both India and Japan hold out hope that their blossoming security relations will dampen the Middle Kingdom’s impetus for expansionism.

The silent partner in Indo-Japanese security relations is the United States. Washington indicated its willingness to pivot to Asia in 2011 but found little local support for it for no South, East, or Southeast Asian mouse wanted to bell the Chinese cat. Robust ties between Delhi and Tokyo offer the most viable foundation for a quiet US pivot to Asia and the several recent naval exercises between these three nations indicates the substance of this invisible partnership. Australia has been another quiet comrade, making the troika into a quartet. Before the guns start roaring, however, Modi and Abe have astutely chosen to strengthen economic and military ties, coordinate policies, and support regional security architecture as a hint to Beijing to desist from its threatening behaviour.

The outcome of this summit appears positive on the economic front, cautiously optimistic in the security arena, and uncertain in the nuclear field. Yet what still makes it pleasing for Modi to engage with Abe is the shared values and intellectual framework between Indians and Japanese. As the inheritors of a similar set of ancient Asian cultural values, the two countries make ready partners in an Asian century. Mutual security concerns and economic complementarities only further highlight the logic of a close relationship between India and Japan, even if this summit does not deliver all that observers expect of it. There may be no permanent friends in international affairs, but Shnizo Abe and Japan are probably as close to it as India can get in the short and medium term.