Just as Japan assisted China’s economic rise through large-scale aid, investment and technology transfer for over three decades — a role obscured by the recent flare-up of territorial disputes — it is ready to help India become an economic powerhouse on par with China

Brahma Chellaney, Japan Times

Rarely before in recent years has Japan gone so much out of its way to welcome a foreign leader as it did when receiving India’s new prime minister, Narendra Modi (or NaMo to his fans), who started his tour from Kyoto. Prime Minister Shinzo Abe not only broke protocol by receiving Modi in Kyoto last Saturday but also spent the weekend with him in that old imperial capital, holding a tête-à-tête with his guest and praying with him at the 1,200-year-old Buddhist temple of Toji, a world heritage site.

The NaMo-Shinzo show actually took off with a big bear hug, illustrating how close personal bonds between two government heads can help add greater momentum to a bilateral relationship. Modi deliberately made Japan his first foreign port of call beyond the Indian subcontinent so as to spotlight that country’s centrality to Indian interests.

With Japan and India moving from emphasizing shared values to jointly advancing shared interests, their ties already constitute Asia’s fast-growing bilateral relationship. Abe and Modi, however, wish to turn this blossoming partnership into a defining element in Asia’s strategic landscape so that Japan and India serve as key anchors of a stable power balance.

The rationale bringing India and Japan closer together is powerful: If China, India and Japan constitute Asia’s strategic triangle — with China representing Side A (the longest side of this scalene triangle), India Side B, and Japan Side C — the sum of B plus C will always be greater than A. In the absence of a Japan-India axis, the rise of a Sino-centric Asia could become inevitable.

Containing China, however, is not an option. China is the largest trading partner of both Japan and India, which cannot afford to disrupt their relationship with Beijing. Nor are India and Japan seeking to forge a military alliance in which each will be obligated to come to the defense of the other.

The key issue for India and Japan is how to address Asia’s current power disequilibrium, which has arisen due to the rapid rise of an increasingly assertive China that is seeking to disturb the territorial and maritime status quo. An entente between Asia’s two main democracies can help restore a fair degree of equilibrium to the power balance.

Abe, 59, and Modi 63, represent the best chance for Japan and India to establish such an entente. Ideologically, Abe and Modi are soul mates, sharing similar political values, including market-oriented economics, soft nationalism, a proactive foreign policy, and a new Asianism that seeks to promote a web of interlocking strategic partnerships among important democracies in the Asia-Pacific. The two belong to the 1950s generation, share the zodiac sign of Virgo, and regard each other as friends.

Indeed, like two buddies meeting after a long time, Modi and Abe greeted each other with an effusive hug and glowing and beaming smiles. By contrast, Modi’s predecessor, the octogenarian Manmohan Singh, was a generation older than Abe, who greeted him with the customary handshake each time they met.

International-relations theory assumes that interstate relations are shaped by impersonal forces, especially cold calculations of national interest.  In truth, history is determined equally, if not more, by the role of personalities, including their personal strengths and foibles and their search for national security and respect.

The Abe-Modi affinity has been fostered both by personal chemistry and hardnosed calculations about the importance of Indo-Japanese collaboration in their plans to revitalize their countries’ economy and security and restore national pride. Modi’s personal rapport with Abe was built during his 2007 and 2012 visits to Japan as chief minister of the western Indian state of Gujarat.

In a reflection of their close bond, Abe follows only three people on Twitter: his outspoken wife Akie, author-turned-politician Naoki Inose, and Modi. “I am eagerly awaiting your arrival in Kyoto this weekend,” Abe tweeted to Modi last Friday, declaring, “India has a special place in my heart.” Earlier, in a tweet in Japanese and English, Modi expressed “excitement” over his impending meeting with Abe, adding he “deeply respects” Abe’s leadership and “enjoys a warm relationship with him.”

Abe sees India as the key to expanding Japan’s security options beyond its current U.S.-centric framework, while Modi views Japan as central to the success of India’s “Look East” strategy. “Abenomics” and “Modinomics” are both geared to the same goal — reviving laggard growth­ — yet they need each other’s support for success.

Whereas Tokyo sees India as important to its own economic-revival strategy, India looks at Japan as a critical source of capital and commercial technology and and a key partner to help upgrade its infrastructure and manufacturing base. India — the biggest recipient of Japan’s Official Development Assistance, which is currently funding more than 60 Indian infrastructure projects — has become the largest destination for Japanese foreign direct investment (FDI) among major economies.

The path is gradually opening up to Japanese exports of weapon systems and, potentially, nuclear power equipment to India, the world’s largest arms importer and one of the few countries still wedded to building new commercial nuclear plants in the post-Fukushima era. Abe’s reassertion of the right of collective self-defense and his relaxation of Japan’s self-imposed ban on export of arms have opened the path to closer military cooperation with India, including co-production of weapon systems.

The two countries’ dissimilarities actually create opportunities to generate strong synergies through economic collaboration. Japan has a solid heavy manufacturing base, while India boasts services-led growth. India is a leader in software and Japan a leader in hardware. India has the world’s largest youthful population (about two-thirds of Indians are younger than 35), while Japan is aging more rapidly than any other major developed country. Whereas Japan has financial and technological power, India has human capital and a huge market for goods and services.

Japan clearly has an interest in a stronger, more economically robust India. Just as Japan assisted China’s economic rise through large-scale aid, investment and technology transfer for over three decades — a role obscured by the flare-up of territorial and other bilateral disputes in recent years — it is ready to help India become an economic powerhouse on par with China, a consideration that prompted Abe to pledge a whopping $35 billion in new assistance.

China, by contrast, has little interest in aiding India’s economic ascent. Beijing boasts a booming trade with New Delhi, but that commerce bears a distinct mercantilist imprint and shows India in an unflattering light: China exports three times as much as it imports and treats India as a raw-material supplier and a market for its finished goods. This asymmetry is made more glaring by China’s minuscule FDI in India. The present pattern of Chinese companies merely exporting finished goods in increasing quantities to India is not sustainable.

A challenge for Modi is to correct the lopsided trade and calibrate China’s market access to progress on bilateral political, territorial and water disputes, or else Beijing will fortify its leverage against India. After all, China does not shy away from making efforts to block the rise of India and Japan, including by stepping up military pressure on them and opposing the expansion of the UN Security Council’s permanent membership. Japan and India thus have a shared interest in working together to restrain China’s exercise of its rapidly accumulating power, which risks sliding into arrogance.

The Japan-India relationship — characterized by “only goodwill and mutual admiration,” in Modi’s words — can reshape Asian geopolitics and institute power stability. The process to significantly tap that potential is just beginning. Modi urged that the two countries should “strive to achieve in the next five years their relationship’s unrealized potential of the last five decades.”

After charming Nepal and Bhutan on highly successful visits, Modi’s landmark trip to Japan has not only helped to define the parameters for Asia’s new democratic alliance but also set in motion the addition of concrete strategic content to this “special strategic and global partnership” — its formal name. The entente holds the potential to revive the two countries’ economic fortunes, catalyze their emergence as world powers, reshape the Asian strategic landscape, and impel a tectonic geopolitical shift.

Brahma Chellaney is a geostrategist and author.

(c) The Japan Times, 2014.