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Indo-Japan Relations

Indo-Japan relations have traditionally been very strong. Rather they date back to 6th century A.D. when Buddhism which was born in India was introduced in Japan, and it would be incorrect to write that these Asian countries are in search of new relationship. Furthermore, India’s national leaders drew inspiration not just from Tagore’s poetic tributes and Visvesvaraya’s political lessons, but also equally from Japan’s victory over Russia at the beginning of 20th century—the first Asian nation to vanquish a western power.

As far as diplomatic relationship between the two countries is concerned, it remained cordial after its establishment in April 1952, except during India’s 1998 Pokhran nuclear test. But then, while India was the first country to receive Japanese Official Development Assistance (ODA) in 1958, Cold War realities continued to keep these two Asian democracies apart for the best part of 20th century. With the end of cold war the strategic divide between two nations was over and there appeared to be convergence of interests in maintaining peace and stability in Asia.

Also it has taken more than a decade of concerted effort to finally get both governments to commit themselves to a transformation of a special strategic and global partnership into a deep, broad-based and action-oriented partnership.

The first comprehensive bilateral security dialogue was held in July 2001 and in October 2001 when Japan decided to lift the economic sanctions it had imposed after India’s nuclear test in 1998. In 2006, it was decided to establish a strategic and global partnership between the two that emphasized contributing to greater regional peace and stability via closer political and diplomatic coordination on bilateral, regional, multi-lateral and global issues and stronger defence relations. It was only in June 2012 that India and Japan conducted their first bilateral exercise off coast of Tokyo—the year then marked 60th anniversary of the establishment of diplomatic relations between India and Japan.

The launch of Comprehensive Economic Partnership Agreement (CEPA) in 2007 marked the beginning of a new phase in our economic relationship with Japan. The institutional framework to further accelerate and consolidate business activities between India and Japan has been put in place with CEPA that came into effect in August 2011. There are several factors that have contributed to the changing Japanese companies’ perception of Indian economy. These are :

l       India’s economic growth despite global economic downturn.

l       Domestic demand.

l       Expansion of India’s working population over the long term.

l       Strengthening ties with other East Asian economies especially South Korea.

l       Geographically strategic location of India to develop as a production and export base for the growing market in the Middle East and Africa.

Apart from these, the two things made Japan wake up to India’s opportunity—firstly South Korea overtaking Japan in Indian market and emergence of China as the World’s second biggest economy, overtaking Japan, being the second.

Of the other things, security cooperation has emerged as an important area of bilateral engagement—signing a declaration on security cooperation in 2009 and first ever bilateral maritime exercise held in June, 2012 as aforesaid. These two nations have also been cooperating in Asian Cooperative Security architecture through East Asia Summit, which is a forum for dialogue on the broad range of strategic, political and economic issues.

Furthermore, India-Japan ‘strategic and global partnership’ is based on 5 pillars of cooperation as—

  1. Political, defence and security cooperation
  2. Comprehensive Economic partnership
  3. Science and Technological Initiative
  4. People to people exchanges
  5. Multi-lateral and regional fora.

Presently as India’s Look East policy is now being expanded, and seeks to create a web of bilateral and multilateral links in Asia, India and Japan have put their relationship on a firm base which includes ‘2 + 2 dialogue’, the Foreign Secretaries Dialogue, the Defence Secretaries Dialogue and trilateral dialogue between India, US and Japan. Both countries have recognised each other and as a result of their relations it has further undergone a significant and qualitative shift in recent years, propelled by successful regular summit level exchanges. During PM Modi’s visit to Japan in September, 2014, the two countries signed a Memorandum of cooperation and Exchanges in the field of defence, thus aimed at boosting India’s military-strategic partnership and securing desperately needed investments to revive India’s flagging economy. It was in 2014 that Japanese PM Shinzo Abe declared its relation with India as a part of Japan’s foreign policy and an alliance between India and Japan as one with most potential of any in the world so as to elevate relationship to a special strategic and global partnership. Indian PM Modi, in turn proclaimed Japan to be at the heart of India’s Look East Policy, now Act East Policy, Another Momentum ties between the two countries have taken place in the recent years when Japanese PM Shinzo Abe visited India as the chief guest at country’s 65th Republic Day celebration in 2014. Also first ever US-India-Japan trilateral ministerial dialogue was held in September 2015.

The relationship between India and Japan has been seen to be more pronounced when Abe visited India in second week of December 2015, which was his 3rd visit to India since taking over as PM of Japan. During his visit it was announced that it will regularly participate in bi-annual ‘Malabar’ Military exercises to help create stronger capabilities to deal with maritime challenges in Indo-pacific region.

The most comprehensive statement of long-term bilateral agreement is ‘India-Japan Vision 2025’, which is defined by shared interest and values dealing with security, stability, profitability of Japanese investment in India. Also 14 agreements were signed in the recently held Indo-Japan summit in New Delhi in various fields. Both had signed and ratified amended Double Taxation Avoidance (DTA) convention which was signed in 1989 for avoidance of double taxation and prevention of fiscal evasion through a protocol in December 2015. India has extended visa on Arrival facility for Japanese nationals, including businessmen to be effective from March 1, 2016. Apart from these, historic Memorandum of Cooperation to introduce High Speed Rail (HSR) on Mumbai-Ahmedabad HSR corridor to revolutionize railway was signed for $ 12 billion which will become an engine of economic transformation in India. Japan announced creation of ‘Japan-India Make in India Special Finance Facility’ with corpus of $ 11 to 12 billion, the funding for which is to be provided to Japanese companies which will manufacture their products in India. Also the intentions were expressed by Japan to set up ‘Japan Industrial Townships’—to be provided incentives and tax benefits in line with SEZ and NIMZ—to come up in Maharashtra, Rajasthan and Madhya Pradesh. They have also reached at substantive agreement on the cooperation in peaceful use of nuclear energy and transfer of defence equipment and technology—subjected to ratification of Japanese Diet. Both countries are engaged in creating a Regional Comprehensive Economic Partnership (RCEP) and Japan has agreed to support India’s case of membership of APEC and Japan is to promote India’s Act East Policy on ‘One Belt One Road Project’—which would be running parallel to China’s OBOR Project.

It is presumed that the cooperation of India and Japan on nuclear power and defence may exert a huge impact on Asian landscape. It is also believed that an agreement on the transfer of civil nuclear technology is vital to India’s continued economic growth and development and has important strategic implications for Indo-pacific regions. It is to be noted here that as Japan reformulates its foreign policy in the quest to assume a greater leadership role in Asia, it finds and shares an unprecedented convergence in interests, values and strategies with a rising India that is eager to ‘Look East’ and ‘integrates itself into Asia and Asian institutions.

On the whole, therefore it can be said that the recent visit of Japanese PM strengthened the bilateral ties between the two nations and sowed the seeds of enhanced cooperation in several fields like science and technology, development of urban centres and cities etc. Both nations supported each other’s concerns and pledged to enhance the relationship further in building global peace and security. Thus, all these developments are signalling a new level of partnership between Asia’s two great democracies imparting new self-confidence to both at a particularly critical moment in Asia’s emerging power structure.

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