NETWORKING FOR GROWTH AND DEVELOPMENT

G Parthasarathy 
14 November 2014  
http://www.dailypioneer.com/columnists/edit/networking-for-growth-and-development.html

Narendra Modi would likely discuss the possibility of Indian participation in the US-led Trans-Pacific Partnership to develop an economic alliance extending from India to the US, Mexico and Canada

Prime Minister Narendra Modi will be setting a new record for an Indian Prime Minister by his participation in four multi-lateral summits in November. It began in Myanmar for two summit meetings, the first with Association of Southeast Asian Nations heads of Government. Then there has been the East Asia summit, which brings him together with leaders of the US, Russia, China, Japan, South Korea, Australia and New Zealand. He thereafter proceeds to Brisbane to participate in the G20 summit, bringing together leaders of the developed world and emerging markets. This involves interaction with advanced economic powers including the US, Canada, Australia and the leading economies of Europe. Together with the emerging economies of Brics and Indonesia. Towards the end of the month, he will attend the South Asian Association for Regional Cooperation summit in Kathmandu — an event with political importance, but showing little economic promise, thanks to Pakistani obduracy.

These meetings are taking place after a successful Brics summit. This summit led to the first tentative step for ending the global economic dominance of the US and its European partners, by the establishment of the Brics Development Bank and the Asian Infrastructure Investment Bank in China. These institutions should be realistically seen as complementing, supplementing, but not supplanting, institutions like the Wold Bank, International Monetary Fund and Asian Development Bank. India needs to make it clear that a multiplicity of institutions for developmental assistance fits in excellently with its belief in a genuinely multi-polar world. If some countries take serious objection to American unilateralism, an equal number have serious misgivings about increasing manifestations of Chinese hegemony, territorial expansionism and crass mercantilism in developing countries.

Ever since Prime Minister Narasimha Rao set India on the path economic liberalisation, one of the most productive aspects of Indian diplomacy has been the country’s growing economic integration with the fast growing economies in its eastern neighbourhood, extending across the Strait of Malacca, to the South China Sea and the Pacific Ocean. The major security concern of Japan and Asean countries like Vietnam and the Philippines has been the Chinese propensity to use its growing military power to enforce its maritime territorial claims. While India should go along with an Asean consensus on this issue, it has happily put aside the Hamlet-like self-doubt and pusillanimity that characterised the approach of the national security establishment of the UPA Government, in responding to Chinese aggressiveness, not only on China’s maritime boundaries, but also on its land borders with India.

A clear manifestation of this change occurred in Washington, when the Modi-Obama Joint Statement affirmed the “importance of safeguarding maritime security and ensuring freedom of navigation and over flight throughout the (Asia-Pacific) region, especially in the South China Sea”. This was followed by shedding earlier fears on equipping the Vietnamese Armed Forces. The supply of naval patrol boats and expanded training facilities to the Vietnamese Armed Forces will hopefully soon be followed with equipping the Vietnamese with supersonic BrahMos cruise missiles, to meet Chinese maritime challenges. There should be effective answers to the Chinese policies of “strategic containment” of India, through its nuclear and missile proliferation to Pakistan and its propensity to seek strategic encirclement of India, in the Indian Ocean region.

Prime Minister Narendra Modi, who has developed an excellent personal rapport with his Australian counterpart Tony Abbot, will proceed from the G20 summit in Brisbane to Sydney, Canberra and Melbourne, for an interaction with the 2,90,000 strong Indian community, and will address the Australian Parliament, and conduct extensive discussions with the business and investor community. Virtually every major Indian IT company has an office in Australia. Indian private investment in copper and coal mining in Australia is growing. Major Indian companies ranging from the Tata Power and Aditya Birla Group, to Sterlite Industries, Petronet LNG and the Adani Group have investment interests in Australia. Even the State-owned National Mineral Development Corporation has an agreement with Australian mineral giant — Rio Tinto, for joint exploration in India and Australia.

India and Australia are set to expand military cooperation. We have to remember that western Australia is located on the shores of the Indian Ocean. It would be useful to establish institutional links between our Andaman and Nicobar Command and its counterparts in nearby Perth. Moreover, India and Australia should seek to work for a system of cooperative security across the Strait of Malacca with Asean partners, especially Indonesia. India also needs to move ahead with steps to finalise a Comprehensive Economic Partnership Agreement with Australia.

Mr Modi would likely discuss the possibility of Indian participation in the American-led Trans-Pacific Partnership for developing a free-trade, investment and economic partnership extending from India to the US, Mexico and Canada. 14 countries including Australia, New Zealand, Japan, South Korea and four Asean members — Vietnam, Singapore, Malaysia and Brunei, have joined negotiations on the TPP. Indonesia, Philippines and Cambodia have expressed an interest in joining the negotiations. There are naturally apprehensions in India on issues like Intellectual Property Rights, Investment Protection and Government Procurement. These are issues which could be discussed with Prime Minister Mr Abbot, who has taken a keen interest in the TPP.

Mr Modi’s visit to Australia is taking place when there are drastic changes emerging in the global energy situation. The United States is now the largest producer of oil in the world. It is also being becoming a significant exporter of natural gas across its Atlantic and Pacific shores. Canada is also emerging as a major exporter of gas across the Pacific. Both Japan and South Korea, major buyers of Australian liquefied natural gas, will soon have alternate sources of supply.

Australia is also increasing its LNG exports substantially from its Indian Ocean terminals, to reach 83 million tonnes annually in 2017, and expand further, thereafter. Given western Australia’s proximity to our eastern coast, Mr Modi’s visit would be an ideal occasion to give momentum to efforts for long-term agreements for imports of LNG from Australia, which would facilitate development of petrochemical, fertiliser and power industries along our east coast. India’s excessive dependence on imports of oil and gas from the Persian/Arab Gulf Region should be reduced.