IS THE EMERGING GLOBAL ORDER BIPOLAR?

THE CONTEXT: The world has witnessed several disruptions in recent years. China’s phenomenal rise has unleashed a superpower competition between USA and China. This is indicative of a recognition of emergence of bipolar world order.

EMERGING SHAPE OF CURRENT WORLD ORDER

  • Bipolarity can be defined as a system of world order in which the majority of global economic, military and cultural influence is held between two states. The classic case of a bipolar world is that of the Cold War between the United States and the Soviet Union, which dominated the second half of the 20th century.
  • However, the present world order is one of asymmetric bipolarity in which the U.S. still remains a pre-eminent power, but China is advancing fast as well.
  • The effects of this bipolarity have substantially deepened as both USA and China have become aware of the new global structure and are acting accordingly.
  • Meanwhile, there are other power centres emerging and they will play a significant role in the balancing of power. Russia is challenging the post-World War security architecture in Europe through military means. In West Asia, Israel is engaged in a brutal war with The world is also witnessing the rise of several middle powers such as India.

Power as defining feature of world order:

Power has been the defining feature of how world orders have been built and destroyed over the years, and this power has often been military at its core.

  • In the 19th century, countries that developed steam engines and developed naval fleets, small European countries, became great powers.
  • In the 20th century, with nuclear evolution, the concept of superpowers emerged. Great powers could control multiple events around the world and superpowers could control multiple events around the world simultaneously.
  • The 21st century is one of people’s power and connectivity that the world sees today is unprecedented. That results in interactions, sometimes even interdependence, to some extent global integration, and therefore there could be bipolar impulses.

Case of China and Russia:

  • China: China has seen a phenomenal rise economically and militarily over the past four decades. In the last 40 years, its GDP in 1990 was $300 billion, moved to $1 trillion-plus at the turn of century and is now $19.3 trillion. And the fact that China is controlled by one party and virtually one man makes this economic lever particularly powerful in redefining the world order.
  • Russia: There are emerging ties of Russia with China but Russia too is conscious of the fact that they cannot put all their eggs in one basket. There are concerns particularly regarding the balance of power in Central Asia. There are enough signals from Russia that it would like to diversify its relationship, particularly in terms of energy, with the developing economies of Asia. Also, Russia is seriously looking at reinventing their ties with India.

IMPLICATIONS FOR INDIA

  • Not a balanced approach: India faces an entirely new set of challenges in the new global disorder with S.­-China great power contest. During the Cold War, India didn’t have hostile relations with any of the opposing superpowers but in today’s scenario, China is major rival of India. India would be tempted to join the American bloc as it faces the China problem and may give up on its balanced approach.
  • Security Challenges: Various security challenges are unfolding in India’s neighbourhood. India’s security establishment and strategic community have consistently flagged the issue of the growing Chinese presence and involvement. With hegemony of China, India tends to face more security challenges in the region.
  • Relation with China: The power imbalancebetween India and China has widened in recent years. China has also developed a strategic partnership with Pakistan and raising its influence in other South Asian and Indian Ocean countries. With growing power of China, India will remain concerned about its geopolitical and economic implications.
  • Relation with USA: There is often a temptation to view India’s relations with the U.S. and China in contrasting terms that India has a smooth relation with USA. But relation with USA is not always smooth. For example, India and the U.S.A had signed a joint statement in July 2005, which opened up a new relationship and a nuclear deal was finally signed in 2008. And India was supposed to get six nuclear power reactors from the U.S.A and these have not come yet.
  • Relation with Russia: Russia is a traditional partnerwith which India has deep defence ties. India is under huge pressure to take a more critical position on Russia’s actions. Russia’s invasion of Ukraine has complicated India’s options further. India also worries that the West’s move to isolate Russia in Europe would push the country further into the Chinese embrace.

Thus, if the competition between China and the U.S., and Russia and the U.S., heats up, it does reduce the flexibility of India in terms of how to manage good relations with Russia, China, and the U.S. However, given that these countries are enormously dependent on each other, there is less chances of any rigid bipolar system happening in the future.

CHALLENGES OF A BIPOLAR WORLD

  • Rising number of conflicts: As two rival powers cannot remain in equilibrium indefinitely, therefore conflict is inevitable in a bipolar world. In this regard, global order is not stable during periods of bipolarity, but instead, warfare appears to be necessary for the resolution of rivalry between two superpowers. Ultimately, bipolarity is based on constant tension, which leads to competition, and ultimately, war.
  • Unstable policy making: These changes in the world actually leave the world in an unstable situation. There is a lack of clarity on which direction the world is headed. It makes policy making harder formiddle powers like India.
  • Negative economic implications: Rising of bipolar world has negative economic implications globally. Trade war between two strong countries have tendency to cause uncertainty in the financial markets. It can thus impact trade flows and may lead to even global recession.
  • Waning globalisation: International political economy is regarded as the principal focus of the forces of globalization and the main way in which globalization is transmitted throughout the world. Bipolar world can lead to powerful countries limiting themselves in their own sphere which can led to waning of globalisation.

THE WAY FORWARD

  • Balanced approach: India should develop a balanced foreign policy outlook for both the nations focussing on its economic growth and development. Revival of Non Alignment, for example, by bringing in Non-Alignment 2.0 with China and the U.S. is the one of the solution to have a balanced approach. It would help with India’s security and sovereignty.
  • Internal balancing: There is a need to maintain and strengthen our own foreign policy approach to tackle uncertain global situation. Also, there is a need to strengthen security to particularly bring about peace and tranquillity in the border states.
  • India’s strategic approach towards a rising China: There is a need to acknowledge the fact that China is going to be a long-term competitor in Asia and there is a need to have strategic approach towards China. And the border is just one of the pressures points that China uses against India. Also, there is a need for lessening dependence on China and seeking external balancing to concentrate on self-strengthening.
  • Diversification in strategic partners:The present-day geopolitical and geostrategic circumstances present a multifaceted challenge to India’s foreign policy. Therefore, India’s cold war narrative of strategic neutrality is being gradually replaced by strategic hedging.

In a multipolar world India should not limit its engagements with Russia, the US and China but expand its relationship with other countries of the EU, ASEAN etc.

  • Indigenous defence modernisation:India is dependent on many foreign players like U.S, Russia etc. for its defence requirement, this may not pave good in national interest. Therefore, it is imperative to speed up indigenous defence modernisation, especially in the context of counterbalancing China.

THE CONCLUSION:

India has been successful in deploying ‘multi-vector’ foreign policy in the past by having a balanced approach. In the current situation as well, Indian foreign policy should not envisage complete isolation or enter into alliance with one great power. Thus, it should opt for multi­engagement not multi­alignment for a multipolar world and have a variable relation with several like-minded partners.

UPSC PREVIOUS YEAR QUESTIONS

Q.1 “The long sustained image of India as a leader of the oppressed and marginalised nations has disappeared on account of its newfound role in the emerging global order.’ Elaborate. (2019)

Q.2 Evaluate the economic and strategic dimensions of India’s Look East Policy in the context of the post-Cold War international scenario. (2016)

MAINS PRACTICE QUESTION

Q.1 India has historically prided itself as an independent developing country which did not succumb to pressure from great powers.  Analyse the current position of India in the changing world order and suggest steps it should take to have a balanced approach.

SOURCE:https://www.thehindu.com/opinion/op-ed/is-the-emerging-global-order-bipolar/article67591021.ece




“INDIA AND THE ARCTIC: BUILDING A PARTNERSHIP FOR SUSTAINABLE DEVELOPMENT”

THE CONTEXT: The Ministry of Earth Science unveiled India’s Arctic Policy on 17 March 2022, titled “India and the Arctic: building a partnership for sustainable development”, with the aim of enhancing the country’s cooperation with the resource-rich and rapidly transforming region. The policy also seeks to combat climate change and protect the environment in the region, which is warming three times faster than the rest of the world. This article explains the need for an Arctic Policy for India, looks into the gaps in India’s present engagement in the Arctic, and analyses the features of India’s Arctic Policy released recently.

WHAT AND WHERE IS THE ARCTIC?

  • It is commonly understood to refer to the region above the Arctic Circle, north of latitude 66° 34′ N, which includes the Arctic Ocean with the North Pole at its centre.
  • The Arctic is a vast and varied region whose annual cycle is influenced by the strong variation in the amount of light. The further north you are, the more there are daylight hours in winter and nightless nights in summer. In the Arctic, winters are long, and the growing season is short. The Arctic land area comprises only about 5% of the land surface of Earth.
  • The Arctic is home to almost four million inhabitants, of which approximately one-tenth are considered indigenous people.
  • The Arctic Ocean and its surrounding landmass have been a topic of immense interest and a high-priority area of research among the global scientific fraternity, as well as of importance to policymakers.
  • The Arctic influences the atmospheric, oceanographic and bio-geo-chemical cycles of the Earth’s ecosystem.

WHAT IS ARCTIC COUNCIL?

  • The Arctic Council is the leading intergovernmental forum promoting cooperation, coordination and interaction among the Arctic States, Arctic Indigenous peoples and other Arctic inhabitants on common Arctic issues, in particular on issues of sustainable development and environmental protection in the Arctic. It was formally established in 1996.
  • It is not a treaty-based international legal entity like the UN organizations or trade or regional groupings such as NATO or ASEAN.
  • It was set up by the 8 Arctic countries by means of the Ottawa Declaration of 1996. These countries are the US, Canada, Russia, Iceland, Denmark, Sweden, Norway, and Finland.
  • In addition to these countries, 6 organizations representing the indigenous people of the Arctic region have also been given the status of permanent participants.
  • India holds one of the 13 positions as the Observer in the Arctic Council.

What is the observer status of the Council?

  • The observer status is provided to countries or entities that support the objectives of the Arctic Council through financial or other contributions.
  • Observers cannot participate in the decision-making process.
  • They are invited to participate only in the meetings of the Council, particularly at the level of the working groups.
  • The renewal of the observer status is just a formality. The status, once given, continues until the entity carries out any activities that run against the objectives of the Council.

INDIA’S JOURNEY AT THE ARCTIC COUNCIL

1920: India’s engagement with the Arctic began when it signed the Svalbard Treaty in Paris between Norway, the US, Denmark, France, Italy, Japan, the Netherlands, Great Britain, and Ireland, and the British overseas Dominions and Sweden concerning Spitsbergen.

2007: India initiated its Arctic research program in 2007 with a focus on climate change in the region.

2008: India established Himadri- India’s first permanent Arctic research station located at Spitsbergen, Svalbard, Norway.

2013: India was first granted the Observer status in 2013, along with five other nations.

2014: India deployed IndARC it is India’s first underwater moored observatory in the Arctic region 2014 at Kongsfjorden fjord, Svalbard, Norway. Its research goal is to study the Arctic climate and its influence on the monsoon.

2016: Another atmospheric laboratory was established in 2016 at Gruvebadet in Ny-Alesund with the aim of initiating studies on clouds, precipitation, long-range pollutants, and other background atmospheric parameters.

2019: India was re-elected as an Observer to the Arctic Council.

ABOUT: INDIA’S ARCTIC POLICY

India’s Arctic Policy aims to enhance the country’s cooperation with the resource-rich and rapidly transforming Arctic region. The policy also seeks to combat climate change and protect the environment in the region, which is warming three times faster than the rest of the world. It was released by the Ministry of Earth Sciences.

OBJECTIVES OF INDIA’S ARCTIC POLICY

  • It aims to strengthen national capabilities and competencies in science and exploration, climate and environmental protection, and maritime and economic cooperation with the Arctic region.
  • To strengthen institutional and human resource capacities within the government and academic, research and business institutions through inter-ministerial coordination in pursuit of India’s interests in the Arctic.
  • To enhance understanding of the impact of climate change in the Arctic region on India’s climate, economic, and energy security.
  • To promote better analysis, prediction, and coordinated policymaking on the implications of ice melting in the Arctic on India’s economic, military and strategic interests related to global shipping routes, energy security, and exploitation of mineral wealth.
  • To study the linkages between polar regions and the Himalayas and deepen the cooperation between India and the countries of the Arctic region under various Arctic forums, drawing expertise from scientific and traditional knowledge.
  • To increase India’s participation in the Arctic Council and improve understanding of the complex governance structures in the Arctic, relevant international laws, and geopolitics of the region.

RELEVANCE OF ARCTIC POLICY FOR INDIA?

The relevance of the Arctic for India can be broadly explained under three categories:

SCIENTIFIC RESEARCH, CLIMATE CHANGE AND THE ENVIRONMENT:

  • Under the banner of science and research, the Indian government hopes to build its research capabilities in the region by strengthening existing facilities, such as the Himadri Arctic station in Svalbard.
  • It also hopes to align Indian research with international Arctic priorities. The policy further lays down plans to deploy space technology to better study the Arctic region.

 ECONOMIC AND HUMAN RESOURCES:

  • The Arctic region has rich deposits of coal, gypsum and diamonds and also substantial reserves of zinc, lead, placer gold and quartz. Greenland alone possesses about a quarter of the world’s rare earth reserves.
  • The Arctic contains a wealth of hydrocarbon resources.
  • Arctic also has the potential to address India’s energy security needs and deficiency of strategic and rare earth minerals.

GEOPOLITICAL AND STRATEGIC:

  • The Arctic region is significant due to the shipping routes that run through it.
  • According to an analysis published by the Manohar Parrikar Institute for Defence Studies and Analyses, the adverse effects of the Arctic are not just impacting the availability of mineral and hydrocarbon resources but also transforming global shipping routes.
  • According to the Ministry of External Affairs, India can play a constructive role in securing a stable Arctic.
  • The region holds immense geopolitical importance as the Arctic is projected to be ice-free by 2050, and world powers are making a beeline to exploit the region rich in natural resources.

GAP IN INDIA’S APPROACH

LACK OF AN ARTICULATED POLICY: 

  • Even though the Ministry of External Affairs (MEA) of the Government of India has listed India’s interests in the Arctic to be “scientific, environmental, commercial as well as strategic”, till recently, India was one among the four of the 13 Observer nations of the Arctic Council that did not have a nationally articulated Arctic Policy.

SCIENTIFIC ORIENTATION:

  • India needs to go beyond the purely scientific approach in the Arctic. In keeping with its growing stature and consequent say in world affairs, India ought to be better equipped to understand the dynamics of the Arctic geo-politics and governance.

INADEQUATE FUNDING:

  • Presently, India’s polar research for the Antarctic, Arctic, Southern Ocean and Himalayas is budgeted under the umbrella Polar Science and Cryosphere (PACER) programme of the Ministry of Earth Sciences (MoES). Considering that India’s Antarctic Programme is about five times bigger than its Arctic programme.

POLAR RESEARCH VESSEL (PRV):

  • The lack of a dedicated PRV is considered to be a serious impediment to the growth of India’s polar activities.

WHOLE-OF-GOVERNMENT FOCUS:

  • Presently, the National Centre for Polar and Ocean Research (NCPOR), under the MoES, is the nodal agency for India’s polar research programme, which includes Arctic studies.
  • The MEA provides the external interface to the Arctic Council through the United Nations Economic & Social (UNES) Division.
  • However, the eight countries of the Arctic Council are divided between the Americas, Eurasia and Central Europe Divisions, possibly preventing a region-wide focus on the fast-changing geophysical and geopolitical Arctic landscape.
  • Further, there is no nodal body to coordinate all the activities of the Government of India relating to the Arctic region.

AWARENESS AND CAPACITY:

  • The Arctic has largely been ignored in India on the ground that it is far away and does not have a direct impact on India. This has resulted in a lack of national capacity on Arctic issues.
  • As the Arctic opens up, India needs to expand domestic capability and capacity by building a wide-ranging institutional base on Arctic maritime, legal, environmental, social, policy and governance issues.
  • This can only happen through the introduction of an Arctic-related curriculum in our education system at all levels. India’s engagement with the Arctic needs to be built on sound augmentation of its domestic capacity.

THE WAY FORWARD:

  • Expand the capacity and awareness of Arctic-related scientific research by strengthening the NCPOR, involving other relevant academic and scientific institutions in India, identifying nodal institutes and promoting partnerships among institutions and agencies.
  • Promote research capacities in Indian Universities in the fields of earth sciences, biological sciences, geosciences, climate change and space-related programmes relevant to the Arctic.
  • Widen the pool of experts in sectors such as mineral, oil and gas exploration, blue-bio economy and tourism relevant to the Arctic.
  • Strengthen training institutions for training seafarers in Polar/Ice-Navigation and build region-specific hydrographic capacity and skills necessary to undertake Arctic transits.
  • Build indigenous capacity in building ships of Ice-class standards, including for research.
  • Expand India’s trained manpower in maritime insurance, chartering, arbitration and brokerage for potential usage in the Arctic region.
  • Build wide-ranging institutional capacity for the study of Arctic maritime, legal, environmental, social, policy and governance issues, including the application of UNCLOS and other Treaties governing the Arctic region.

THE CONCLUSION: India’s Arctic Policy is aimed to prepare the country for a future where the biggest challenges facing humankind, such as climate change, can be successfully addressed through, Collective will and effort. India can and is ready to play its part and contribute to the global good. Close partnership with countries of the Arctic region and other international partners to ensure sustainable development, peace and stability in the Arctic region will also be essential for the realization of India’s national development plans and priorities. This approach is in accordance with the challenges facing humankind, such as climate change, which can be successfully addressed only through the Indian philosophy of VasudhaivaKutumbakam-The world is one family.

 Questions for Mains:

  1. India’s Arctic Policy is aimed to prepare the country for a future where the biggest challenge of climate change. Comment.
  2. In the changing geopolitics, initiatives such as New Arctic Policy can be vital to address the emerging energy challenges experienced by India in the recent past. Explain.
  3. How far do you agree with this view that India’s New Arctic is less about energy needs and more about being competitive in geopolitics? Justify your view.



INDIA-AUSTRALIA ECONOMIC COOPERATION AND TRADE AGREEMENT

THE CONTEXT: India and Australia signed an Economic Co-operation and Trade Agreement (ECTA) with an eye on doubling bilateral trade to $50 billion in the next five years and easing the movement of people, goods, and services across borders. The negotiations for India-Australia ECTA were formally re-launched on 30 September 2021 (which were stalled since 2015) and concluded on a fast-track basis by the end of March 2022. This article analyzes different aspects of the deal and the significance of the bilateral trade for both countries.

THE ECONOMIC COOPERATION AND TRADE AGREEMENT (ECTA)

The Agreement encompasses cooperation across the entire gamut of bilateral economic and commercial relations between the two friendly countries and covers areas like:

  • Trade-in Goods,
  • Rules of Origin,
  • Trade in Services,
  • Technical Barriers to Trade (TBT),
  • Sanitary and Phytosanitary (SPS) measures,
  • Dispute Settlement, Movement of Natural Persons,
  • Telecom, Customs Procedures,
  • Pharmaceutical products, and
  • Cooperation in other Areas.

KEY FEATURES OF THE AGREEMENT

PREFERENTIAL MARKET ACCESS:

Australia’s PMA to India: India will benefit from preferential market access provided by Australia on 100% of its tariff lines. This includes all the labour-intensive sectors which are of interest to India such as Gems and Jewellery, Textiles, leather, footwear etc.

India’s PMA to Australia: India will be offering preferential access to Australia on over 70% of its tariff lines. This includes lines of export interest to Australia which are primarily raw materials and intermediaries such as coal, mineral ores and wines, etc.

Both sides have also agreed to a separate Annexure on Pharmaceutical products under this agreement. This will enable fast-track approval for patented, generic, and biosimilar medicines.

SERVICES TRADE:

As regards trade in services, some of the keys offers from Australia in the services space include Quota for chefs and yoga teachers; a Post-study work visa of 2-4 years for Indian students on a reciprocal basis; mutual recognition of Professional Services and Other licensed/regulated Occupations, etc.

India has offered market access to Australia in around 103 sub-sectors and the Most Favored Nation in 31 sub-sectors from the 11 broad service sectors. This includes ‘business services’, ‘communication services’, ‘construction and related engineering services, and so on.

EXCLUDED TARIFF LINES:

India has kept many sensitive products in the exclusion category (29.8% of tariff lines) without offering any concession. These products include milk and dairy, chickpeas, walnut, pistachio nuts, wheat, rice, bajra, apple, sunflowers seed oil, etc.

The agreement also includes strict rules of origin to prevent any routing of products from other countries and provides for a safeguard mechanism to address any sudden surges in imports of a product.

SIGNIFICANCE OF INDIA AUSTRALIA TRADE AGREEMENT

AN ANALYSIS OF THE IND-AUS TRADE AGREEMENT

  • Both India and Australia share a vision of a free, open, inclusive, and rules-based Indo-Pacific region, as well as cooperative use of the seas based on international law, including the United Nations Convention on the Law of the Sea (UNCLOS), and peaceful dispute resolution rather than unilateral or coercive actions.
  • The India-Australia ECTA will strengthen the two countries’ already deep, close, and strategic relations by significantly increasing bilateral trade in goods and services, creating new job opportunities, raising living standards, and improving the general welfare of the two peoples.
  • The India-Australia comprehensive interim free trade agreement is well-timed for both partners and will ensure an uninterrupted supply of key inputs to Indian industries, with Australian businesses gaining access to a more reliable alternative to China, which is resorting to sanctions against the Canberra.
  • A special review mechanism is also envisaged for compulsory review after 15 years for certain aspects of the agreement in a time-bound manner. The review, if requested, is compulsory and has to be completed in six months. This is something new in bilateral trade relations which gives confidence in having a long-term cordial and collaborative relations wherein changes can be incorporated on mutually agreeable terms.
  • India and Australia are members of the QUAD grouping, which also includes the United States and Japan, and bilateral ties will help strengthen cooperation and develop partnerships on several issues of common strategic concerns.

THE WAY FORWARD

  • The government has successfully negotiated an excellent trade deal for businesses. However, Australia has 16 FTAs under operation which means accessing the Australian market wouldn’t be a cakewalk. India would have to work on improving its competitiveness, as in most trade sectors, it would be competing with China, ASEAN, Chile, Japan, Korea, and New Zealand, which have already-functional FTAs with Australia.
  • Active diplomatic engagement would be required to make Australia fulfill its promise to amend its domestic tax law in order to stop taxation of the offshore income of Indian firms providing technical services to Australia. Once the amendment is made, the Indian tech companies would no longer be required to pay taxes on offshore revenues in Australia. This would enhance their competitiveness in the international market.
  • India signed an FTA with the UAE in February 2022 and now an FTA has been negotiated with Australia. The success shall be used in negotiating its future FTA deals with Israel, Canada, the UK, and the EU.
  • The India-Australia trade pact is the second big trade agreement signed by New Delhi in the recent past. It is in sharp contrast to India’s stand at the Regional Comprehensive Economic Partnership (RCEP), the world’s largest trade agreement involving China and 14 other Asia-Pacific nations where India defended its stand by raising concerns about Chinese goods flooding the Indian market. India will have to forge several similar alliances, like the one with Australia, to make up for not being a part of RCEP. Furthermore, India needs to play this on the front foot and rise above political considerations and think in purely economic terms.

THE CONCLUSION: This agreement opens a big door into the world’s fastest-growing major economy for Australian farmers, manufacturers, producers and so many more. The India-Australia Economic Cooperation and Trade Agreement (ECTA) is a key step in enhancing bilateral economic ties between the two major Indian Ocean littoral states and reflects the growing strategic alignment between New Delhi and Canberra. While India’s strongest ties with Australia had hitherto largely centered around their common colonial legacy of cricket, best exemplified in the Border-Gavaskar Trophy, a more contemporary shared vision has emerged around the mutual need to strengthen their strategic and trade engagement.

Mains Practice Questions:

  1. Elaborate on how the growing India-Australia economic and commercial relations can contribute to the stability in the Indo-pacific region?
  2. India has recently had bilateral trade deals with UAE and Australia and is in talks with other countries also. How will the bilateral trade agreements help India in realizing the $5T economy dream? Substantiate.

ADD TO YOUR KNOWLEDGE

India Australia Bilateral Relations

HISTORICAL TIES:

  • India and Australia established diplomatic relations in the pre-Independence period, with the establishment of the India Trade Office in Sydney in 1941.
  • India and Australia bilateral relations have undergone transformational evolution in recent years, developing along a positive track, into a friendly partnership.
  • This is a special partnership characterised by shared values of pluralistic, parliamentary democracies, Commonwealth traditions, expanding economic engagement, long-standing people-to-people ties and increasing high-level interaction.

STRATEGIC:

  • The India-Australia Comprehensive Strategic Partnership initiated during the India-Australia Leaders’ Virtual Summit on 04 June 2020 is the cornerstone of our multifaceted bilateral relations.
  • Both countries also held first India-Australia 2+2 Ministerial Dialogue in New Delhi in September 2021 with focus on open, free, prosperous and rules-based Indo-Pacific region.

ECONOMIC AND COMMERCIAL RELATIONS:

  • India and Australia have been each other’s, important trading partners and bilateral economic and commercial relations have continued to enhance and deepen over time.
  • Growing India-Australia economic and commercial relations contribute to the stability and strength of a rapidly diversifying and deepening bilateral relationship between the two countries.
  • Australia is the 17th largest trading partner of India and India is Australia’s 9th largest trading partner.
  • India-Australia bilateral trade for both merchandise and services is valued at US$ 27.5 billion in 2021.
  • India’s merchandise exports to Australia grew 135% between 2019 and 2021.
  • India’s exports consist primarily of a broad-based basket largely of finished products and were US$ 6.9 billion in 2021.
  • India’s merchandise imports from Australia were US$ 15.1 billion in 2021, consisting largely of raw materials, minerals and intermediate goods.

DEFENCE:

  • In 2014, both sides decided to extend defence cooperation to cover research, development and industry engagement.
  • The first-ever Bilateral Maritime Exercise, AUSINDEX, was conducted in Visakhapatnam (Bay of Bengal) in September 2015. The most recent one was conducted in September 2021.
  • In 2018, the Indian Air Force participated for the first time in Exercise Pitch Black in Australia.
  • INS Sahyadri participated in Kakadu, the biennial exercise of the Australian Navy held in 2018, in which 27 nations participated.
  • The 4th edition of AUSTRAHIND (Special Forces of Army Exercise) was held in September 2019.

MULTILATERAL ENGAGEMENT:

  • Both countries have close cooperation in multilateral platforms like Food and Agriculture Organization (FAO) and G20.
  • The Quadrilateral Framework (QUAD) of India and Australia along with the US and Japan emphasize the collective resolve to maintain a free, open and inclusive Indo-Pacific region.
  • Australia was also included in Malabar Exercise in 2020, which now is an annual Naval exercise of the QUAD nations.



BIMSTEC-AN ALTERNATIVE FOR SAARC AND AN OPPORTUNITY FOR REGIONAL STABILITY

THE CONTEXT: The fifth summit of the now 25-year-old Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) hosted by Sri Lanka, was held in March 2022 in a hybrid fashion. India’s Prime Minister, who attended the summit virtually, called for unity and cooperation in the region as it faces economic and health challenges. PM also announced the adoption of the organisation’s institutional architecture- the BIMSTEC charter. This article analyses this development in detail.

DETAIL OF THE SUMMIT

  • The summit’s theme “Towards a Resilient Region, Prosperous Economies, Healthy People” captures the main current priorities of member states and the efforts by BIMSTEC to develop cooperation activities that support member states’ programmes to deal with the economic and development consequences of the Covid-19 pandemic.
  • The main outcome of the summit was the adoption and signing of the BIMSTEC Charter, which formalizes the grouping into an organization made up of member states that are littoral to and dependent upon the Bay of Bengal.
  • The summit saw considerable progress being achieved in the BIMSTEC connectivity agenda with adopting the ‘Master Plan for Transport Connectivity’ by Leaders, which lays out a guidance framework for connectivity-related activities in the region in the future.
  • The Prime Minister underscored the importance of enhanced BIMSTEC regional connectivity, cooperation, and security, made several suggestions, and called upon fellow leaders to strive to transform the Bay of Bengal into a Bridge of Connectivity, Prosperity, and Security among the BIMSTEC-member countries.
  • Three BIMSTEC agreements were signed during the summit
  • BIMSTEC Convention on Mutual Legal Assistance in Criminal Matters.
  • BIMSTEC Memorandum of Understanding on Mutual Cooperation in the field of Diplomatic Training.
  • Memorandum of Association on Establishment of BIMSTEC Technology Transfer Facility.

BIMSTEC: ALL YOU NEED TO KNOW

THE GROUPING:

  • The Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) is a multilateral regional organisation established to accelerate shared growth and cooperation between littoral and adjacent countries in the Bay Bengal region.
  • It has a total of seven member countries- five from South Asia, including Bangladesh, Bhutan, India, Nepal, and Sri Lanka, and two from Southeast Asia, including Myanmar and Thailand.
  • It was founded as BIST-EC, in June 1997, with the adoption of the Bangkok Declaration, with Bangladesh, India, Sri Lanka, and Thailand as members. It became BIMST-EC (Bangladesh, India, Myanmar, Sri Lanka, and Thailand Economic Cooperation) with the entry of Myanmar in late 1997, And eventually, it was named in its current form when Nepal and Bhutan became members in 2004.

THE AIM:

  • The aim of setting up the regional grouping was not to create a new region for cooperation but to revive the connectivity and common interests of the Bay of Bengal region members.
  • According to the official website of BIMSTEC, “the regional group constitutes a bridge between South and Southeast Asia and represents a reinforcement of relations among these countries.”
  • BIMSTEC is different from other regional groupings such as SAARC or ASEAN because it is a sector-driven organisation.

WHAT IS THE WORKING MECHANISM OF BIMSTEC?:

  • Until the current summit, BIMSTEC did not have a formal document or organisational architecture, which was adopted this time in the form of the BIMSTEC Charter.
  • It did have a working mechanism for policy-making and operational goals. Policymaking would be done through two types of meetings: Summits, which are supposed to be held every two years; and ministerial meetings of Foreign and Commerce Ministers of member countries for deciding on trade and economic affairs, to be held once every year. An operational meeting of senior officials to monitor the activities of the grouping is also supposed to be held twice a year.
  • Since its inception, BIMSTEC’s policymaking meetings have not been held as per plan. Just five summits, including the current one, have been held in 25 years.

WHAT IS THE SIGNIFICANCE OF BIMSTEC?:

  • The BIMSTEC region hosts 22% of the world population or 1.68 billion people; the member states have a combined GDP of US$3.697 trillion/per year.

IMPORATNCE OF BIMSTEC FOR INDIA

LOOK EAST POLICY:

  • It should be seen in the context of India’s heightened interest and commitment to its “Act East” policy.
  • Without a strong outreach to BIMSTEC member states, India’s attempts at achieving its Act East policy goals will lack momentum.

SECURITY:

  • It could also be seen as aligning with India’s larger goal to gain trade and security prominence in the Indian Ocean region and to cater to the concept of the ‘Indo-Pacific’ region, a major focus of Quad countries.

AN ALTERNATIVE TO SAARC:

  • The idea of BIMSTEC also gained prominence after the 2016 Uri attack when India was able to get SAARC (South Asian Association for Regional Cooperation) nations on its side to boycott the organisations’ summit, which was to be held in Islamabad, Pakistan.
  • The progress of SAARC has stalled over the years due to Indo-Pak relations and what experts call Pakistan’s obstructionist approach to the organisation.
  • BIMSTEC emerged as an alternative platform for cooperation.

CHINA’S INFLUENCE IN THE REGION:

  • China’s influence and presence in India’s neighbourhood have grown enormously on account of BRI initiatives.
  • Debt burdens have forced India’s neighbours to hand over assets to China.
  • India will be hoping that its economic engagement with the Bay of Bengal littoral states will restrict Chinese influence in these countries.

REGIONAL COOPERATION:

  • BIMSTEC has gained popularity among South Asian countries as a platform for regional cooperation.
  • The organisation is a bridge between South Asia and Southeast Asia.
  • BIMSTEC’s major strength is that it includes two influential regional powers: Thailand and India.
  • The region has countries with the fastest-growing economies in the world.

FUTURE PERSPECTIVEs:

  • India is likely to find that focusing its diplomatic energies on BIMSTEC member states could be rewarding.
  • Relationships among BIMSTEC members are generally cordial, unlike the strained India-Pakistan relationship.
  • BIMSTEC is not without its share of problems. India will need to convince other BIMSTEC members that its new outreach to them is not a “rebound relationship,” a short-term one to thumb its nose at Pakistan.
  • BIMSTEC suffers from a lack of human and financial resources. India needs to allocate more resources to its BIMSTEC budget and should take an informal leadership role to provide BIMSTEC with momentum.

STRATEGIC SHIFT FROM SAARC TO BIMSTEC

THE URI ATTACK AND BOYCOTT OF THE SAARC SUMMIT:

  • In September 2016 India saw a deadly attack on the army camp in Uri.
  • After that attack, India expressed its inability to participate in the Islamabad SAARC summit due to “prevailing circumstances” and stepped up diplomatic pressure on Pakistan.
  • Bangladesh, Bhutan, and Afghanistan followed India’s decision to stay away from the November summit to be held in Islamabad.
  • India and other countries cited “cross-border terrorist attacks in the region” as a reason for boycotting the summit.

SHIFT FROM SAARC TO BIMSTEC:

  • India invited the BIMSTEC leaders to the BRICS summit at Goa in 2016.
  • In doing so it sent out the message that if SAARC wasn’t ready to deliver, India had BIMSTEC to turn to. After that, The Indian prime minister engaged BIMSTEC leaders in bilateral meetings.
  • Since 2016 there has been no movement forward on resuming the SAARC summit.
  • India is regularly attending the BIMSTEC summit and it had emerged as an alternative regional platform where five SAARC (Bangladesh, Bhutan, India, Nepal, and Sri Lanka) countries could gather and discuss sub-regional cooperation.
  • India chose BIMSTEC over any other regional grouping indicative of India’s importance to the Bay of Bengal region.
  • BIMSTEC=SAARC- (Pakistan, Maldives, and Afghanistan) +(Thailand and Myanmar)

WHY IS INDIA’S STRATEGIC FOCUS SHIFTING FROM SAARC TO BIMSTEC?

Apart from the terror issue, there are many other issues which are responsible for India’s strategic shift from SAARC to BIMSTEC. These are

FAILURE OF SAARC:

  • SAARC has come under serious scrutiny in the last few years.
  • From its very inception, member countries treated it with suspicion and mistrust.
  • Even after three decades of its existence, SAARC’s performance has been less than satisfactory, and its role in strengthening regional cooperation is being questioned.
  • In the 30 years of its history, annual SAARC summits have been postponed 11 times for political reasons, either bilateral or internal.
  • Numerous agreements and institutional mechanisms established under SAARC have not been adequately implemented.

PAKISTAN’S NON-COOPERATION:

  • Pakistan’s non-cooperation has stalled some major initiatives under SAARC.
  • At the 18th SAARC summit in Kathmandu in 2014, initiatives such as the SAARC–Motor Vehicle Agreement (MVA), could not be signed.
  • The SAARC satellite project that India proposed was abandoned following an objection from Pakistan in 2016.
  • 19th summit scheduled to be held in Pakistan in 2016 was suspended for an indefinite period, as member countries declined to participate.
  • While cross-border terrorism emanating from Pakistan is a major concern for India, Pakistan has failed to address these concerns.

OPPORTUNITIES FOR INDIA IN BIMSTEC

BRIDGE BETWEEN SOUTH ASIA AND SOUTH-EAST ASIA:

  • Nearly 1.5 billion people live along its coastline.
  • 25% of the world’s traded goods across the Bay of Bengal every year.
  • 80% of Chinese, 90% of South Korea’s, and Japan’s energy imports pass through the Bay of Bengal.

MARKET:

  • The seven countries (apart from India) have a combined GDP of approximately US$ 2.7 trillion with 5.5% economic growth.

RESOURCES:

  • the Bay of Bengal is the world’s largest bay, it is also rich in untapped natural resources, with some of the world’s largest fishing stocks, reserves of gas, and other sea bed minerals.

GEOSTRATEGIC:

  • BIMSTEC community gives tacit recognition to India as a major power in Indo-Pacific by facilitating India to take a leading position.

ROLE IN INDO-PACIFIC:

  • the Bay of Bengal acts as a funnel to the Strait of Malacca linking the Indian and Pacific oceans. It is a major maritime choke-up point for China, Japan, and most East and Southeast Asian states.

DEVELOPMENT OF COASTAL STATES:

  • One-quarter of its population lives in states bordering the Bay of Bengal. Their growth and development are increasingly seen to hinge on the degree of connectivity with the Southeast Asian markets.

WHAT ARE THE CHALLENGES FOR INDIA IN BIMSTEC?

LACK OF HUMAN AND FINANCIAL RESOURCES:

  • BIMSTEC suffers from a lack of human and financial resources.
  • India needs to allocate more resources to its BIMSTEC budget and should take an informal leadership role to provide BIMSTEC with momentum.
  • India is currently the largest contributor to the BIMSTEC secretariat budget.

SUPREMACY:

  • India would have to counter the impression that BIMSTEC is an India-dominated bloc; in that context, India can follow the Gujral doctrine that intends to chalk out the effect of transactionary motive in bilateral relations.

CONNECTIVITY:

  • Connectivity is a major issue among BIMSTEC nations.
  • North-Eastern states are important in deepening connectivity among BIMSTEC nations, but the Siliguri corridor (chicken neck) provides a very narrow passage for movement and obstructs connectivity.
  • The underdevelopment of North Eastern states in terms of infrastructure and connectivity will also be a major hurdle.

REGIONAL INSTABILITY:

  • Regional instability in the form of the Rohingya crisis and other intra and interstate issues can hamper the efficient and effective functioning of the grouping.

THE LACK OF CRITICAL SUPPORT:

  • Strong and clear political commitment, adequate financial resources, full engagement of business and industry, and optimal involvement of civil society has been the principal constraint in BIMSTEC.

BCIM:

  • The formation of another sub-regional initiative, the Bangladesh-China-India-Myanmar (BCIM) Forum, with the proactive membership of China, has created more doubts about the exclusive potential of BIMSTEC.

BIMSTEC VS SAARC: WHICH IS MORE SUITABLE FOR INDIA?

If India wants to prove itself as a regional power, as the largest country in South Asia, India cannot escape its responsibilities under SAARC. The following points explain the differences between SAARC and BIMSTEC. In the end, it can be seen that none of them can substitute for each other. Rather they can complement each other’s roles.

THE WAY FORWARD

  • India can’t afford to remain isolated in the light of recent forays by China in South Asia that India exerts as its own sphere of influence. By facilitating trade and economy through BIMSTEC, India can integrate the economies of surrounding countries. For e.g., India can integrate the BIG-B initiative of Bangladesh with its own SAGARMALA project
  • To build this as a sustainable platform, India should also focus on maintaining consistency in the frequency of the summits to ensure regularity in decision making;
  • It should also fund it more to improve the capacity of the secretariat, both in terms of manpower and funding. In the short term, since India lacks the resources, India should use its clout to derive funds from JICA, World Bank, or ADB.
  • Ensuring tangible results/benefits, which will add to the motivation of the countries to concentrate on BIMSTEC
  • To prevent this platform fall apart like SAARC, India needs to give teeth to it. This can be done by empowering BIMSTEC to be a platform for dispute resolution among member 24 countries. This will require debates and discussions among the BIMSTEC countries to reach a consensus. India should also go ahead of its reservations on certain issues that neighboring countries opine as big brotherly nature to improve their confidence.

THE Conclusion: Recent summit is a good opportunity for India and other BIMSTEC countries to develop a strong regional group to promote peace, stability, and trade. For India, it is an important platform to counter China in the South Asia region. Apart from it, with the help of BIMSTEC countries, India can develop an effective regional group for trade like ASEAN.

Questions:

  1. Discuss the opportunities and challenges for India in the BIMSTEC grouping.
  2. How far do you agree with this view that as being the largest country in the South Asia region, India should lead the region in world politics, and for that India should try for the revival of SAARC? Analyse your view.
  3. ‘BIMSTEC is an opportunity for India for its Act East Policy, but it cannot be an alternative of SAARC’. Critically Examine.