Round The World

New Delhi, 3 November 2009

ASEAN Meet

TAKING ‘LOOK EAST POLICY’ FORWARD

By Dr Parama Sinha Palit

The 15^th Association of Southeast Asian Nations (ASEAN) Summit held in the seaside town of Cha-am, Thailand last month successfully brought together leaders of 16 Asian countries at the table pushing for greater Asian economic and political integration. The Asian leaders who gathered for the Summit, while discussing economic cooperation, disaster management, and climate change, also made attempts to reach out to their counterparts in an effort to build trust and goodwill.

For India it was yet another step towards furthering its ‘Look East’ Policy (LEP) launched in 1992 as a response to the new geo-economic and geo-strategic landscape following the end of the Cold War, and connecting to its East and Southeast Asian neighbours. Prime Minister Manmohan Singh appropriately pointed out that “India’s enhanced engagement with the ASEAN is at the heart of our ‘Look East’ Policy….”

Given the demographic and economic heterogeneities of the ASEAN countries, the region can act as a crucial partner in the future growth of major Asian economies. The region’s economic and strategic potential has prompted New Delhi and Beijing to engage the Southeast Asian countries like never before. However, the Indian initiative to engage the region has been more recent than China’s. The latter’s engagement with the region has been more exhaustive.

Over the years, China has successfully built bilateral economic links with individual ASEAN members. India, on the other hand, has been a late-starter due to many reasons including historical ones. However, its pronounced intent to engage the region culminated in the Free Trade Agreement (FTA) signed with ASEAN recently. The FTA signed by India in August 2009 in Bangkok with one of the world’s largest trade blocks is a major step in this direction.

“A free trade agreement with ASEAN is an international political commitment and is also part of the Look East Policy,” the Economic Times quoted Prime Minister Singh as saying during the Cabinet meeting held on 24 July 2009. After signing of the FTA Singh pointed out that “the conclusion of the India-ASEAN Trade-in-Goods Agreement in August 2009 is a major first step in our objective of creating an India-ASEAN Regional Trade and Investment Area. India-ASEAN trade has grown at a healthy rate and stood at about US $ 48 billion in 2008. The India-ASEAN Summit is an occasion to review the progress in our relations with ASEAN countries. I will inform ASEAN leaders about the several initiatives that India has taken to qualitatively enhance our partnership in diverse areas of our cooperation.”

The ASEAN-India FTA aims to build an institutional framework for greater economic partnership between India and the ASEAN countries. Under the arrangement, the ASEAN member countries and India plan to lift import tariffs on more than 80 per cent of traded products between 2013 and 2016, beginning from 1 January, 2010. Similarly, tariffs on sensitive goods will also be reduced to 5 per cent in 2016, while tariffs will be maintained up to 489 items of very sensitive products. India and the ASEAN are currently negotiating Agreements on Trade in Services and Investment. With a combined Gross Domestic Product (GDP) of US$ 2.3 trillion, and the ongoing economic interactions/exchanges between the countries in the region, there is a huge possibility that they together will create a new free trade area of 1.7 billion people covering 11 countries.

The FTA signals India’s commitment to global economic integration along with political cooperation with its neighbours in the east. However, New Delhi needs to pursue the next stage of economic engagement with ASEAN after the FTA. While the signing of the FTA has taken India’s engagement with the ASEAN countries to a new level of growing partnership by carving a space for India in the region, it has also paved the way for an Asian Economic Community.

While economic engagement has been the hallmark of India-ASEAN growing partnership, the two have made considerable progress in other areas too. The India-ASEAN Science and Technology Fund, the India-ASEAN Health Care Initiative, cooperation in traditional medicines, the India-ASEAN Network on Climate Change and the establishment of a Green Fund are some major initiatives of collaboration between the two. Several programmes to promote people-to-people contact are also in the process of being implemented.

The engagement between India and the ASEAN is mutually beneficial. While India has a lot to gain from its engagement of the region, the ASEAN countries also realize the shared concerns they have with India. These include economic benefits for greater trade and investment, security cooperation and collaboration on environment and climate change. India’s growing significance within the region was reflected during the latest Summit that acknowledged India as an important player.

 India, which became ASEAN’s full dialogue partner during the fifth ASEAN Summit in Bangkok in 1995, is treated a ‘significant’ player by the Asian community given its strengths and expertise in fields like education, herbal medicines, IT, science and technology. According to ASEAN Summit spokesperson, Vimon Kidchob, “the role of India cannot be ignored and that ASEAN expects to enhance trade with New Delhi”.

The India-ASEAN partnership has other facets as well. While both India and ASEAN aspire for greater representation in global councils as well as for developing capacities to contribute constructively and meaningfully to the management of global affairs, the stage has also been set for India to initiate work on areas of mutual interest of the ASEAN member countries namely energy, education, finance, and national disaster management.

Apart from providing opportunities for enhancing ties between India and the ASEAN member countries, the framework has also provided a platform for India and China to bridge differences, especially after the recent spate of border tensions between the two. By bringing together the two heads of State during the Summit, ASEAN has expressed itself as a geographical and political entity trying to act as an effective intermediary between New Delhi and Beijing. It makes immense sense for ASEAN to remain connected to both countries for strategic and economic benefits. By facilitating the meet, the ASEAN group of nations has only further expressed their collective desire to foster peace and cooperation within the region.

The ASEAN was indeed successful in translating the meet of the Prime Minister Singh and his Chinese counterpart into a success by easing the tension between the two Asian giants. The two heads of States agreed to build “trust and understanding” in their bilateral relationship by beefing up their strategic and cooperative partnership.

With the region’s increasing clout becoming evident there is little doubt about ASEAN’s escalating role in shaping the future of the world. With a push for larger ASEAN Community by 2015 and enhancing intra-regional connectivity, in keeping with ASEAN’s agenda, there is considerable scope for meaningful economic exchanges amongst the member countries. India’s qualitative and quantitative economic interactions with Southeast Asia will only integrate India further into the region helping India and the Southeast Asian countries to define a new world order dominated by Asia. ---INFA

(The author is Chief Editor & Singapore Representative of India-China Economic & Cultural Council)

(Copyright, India News and Feature Alliance)