Balancing Belt and Road: India-Japan Cooperation in Light of China’s Rise
China’s Belt and Road Initiative (‘BRI’), which aims to establish a China-focused global trade network through a series of infrastructure development projects, has raised significant strategic concerns for India and Japan. BRI comprises two parts: the overland ‘Belt’, which connects China to oil and gas projects in South and Central Asia as well as the European marketplace, and the maritime ‘Road’, which connects China to maritime trade networks spanning the Indian and Pacific oceans. The development of this so-called ‘Road’ has raised significant concerns for China’s Asian rivals.
For both New Delhi and Tokyo, a reliance on maritime trade for continued economic prosperity makes BRI’s maritime dimension a geostrategic threat. An estimated 80 percent of global trade is transported along global shipping lanes. India, as a highly populous developing country surrounded by the Indian Ocean, and Japan, as an island nation on the edge of Asia, require access to maritime trade networks to access global markets. However, both countries have long-standing strategic rivalries with China stemming from unresolved territorial disputes in the Himalayas and East China Sea and, in the event of a conflict, China could threaten access to shipping lanes. BRI’s apparent role in enhancing China’s military presence internationally, as exemplified by the 2017 establishment of a naval base in Djibouti, has added to these concerns.
One of the key responses by New Delhi and Tokyo has been to enhance bilateral maritime security cooperation, as well as to improve defence ties with countries similarly concerned about China’s rise. One of the most significant developments in this regard has been the establishment of the informal Quadrilateral Security Dialogue (‘Quad’), through which India and Japan, along with the US and Australia, have planned to cooperate on a range of security issues, including China’s rise. Using the term ‘Indo-Pacific’ as an organising principle, collaboration between Quad countries has primarily manifested as enhanced maritime security cooperation, including joint participation in naval drills; although, in February 2018, they collectively announced the intention to create an alternative to BRI, the details of which have yet to be confirmed.
Joint participation in infrastructure development, outside of Quad, also remains a key component of Japan-India cooperation. In May 2017, for example, India, Japan and multiple African governments jointly announced their plans to establish the Asia-Africa Growth Corridor (‘AAGC’), an infrastructure development initiative. Unlike BRI, which has land and maritime components, AAGC will primarily comprise a sea corridor connecting East Africa to ports in South and Southeast Asia. The rhetorical focus by India and Japan has been on the construction of ‘quality’ infrastructure, implying that Chinese projects are sub-standard.
Connecting ports in East Africa with those in South and Southeast Asia is a key component of the AAGC. According to the initiative’s founding document, New Delhi and Tokyo hope to improve ports in Djibouti, Kenya and Zanzibar and connect them to ports in India’s Gujarat, Tamil Nadu and West Bengal states, as well as in Myanmar’s Rakhine State. From there, these would link up with existing networks transporting goods and materials to and from Japan. Emphasis is also placed on development projects in the health, pharmaceuticals, agriculture, and agro-processing sectors, as well as improving disaster management capabilities and human resources across the African continent.
The exact figure for the AAGC has not been announced. However, in comparison with about USD 60 billion from China, Japan has pledged to invest USD 30 billion in Africa by the end of 2018 and India has reportedly invested about USD 15 billion in the continent. Given the interest of all three countries in African economic development, the construction, energy, infrastructure, technology, telecommunications, and manufacturing sectors across the continent are likely to benefit from increased geopolitical competition in Asia.
To date, China has not publicly opposed increased cooperation between Japan and India on infrastructure development projects in Africa or elsewhere. BRI has been criticised abroad, with many commentators alleging that Beijing is trapping developing countries in debt for geopolitical purposes. As such, overt criticism of Tokyo and New Delhi’s attempts to establish alternatives would be viewed with suspicion. However, Beijing has expressed concerns about their maritime security cooperation with other Quad countries and the adoption of the term Indo-Pacific, which Beijing views as an attempt to contain its economic rise and undermine its territorial claims in the South China Sea.
For both New Delhi and Tokyo, a reliance on maritime trade for continued economic prosperity makes BRI’s maritime dimension a geostrategic threat.
While India and Japan share concerns about BRI and its implications for maritime security, neither wants to challenge Beijing directly, as China is the largest trading partner for both countries. Going forward, New Delhi and Tokyo will attempt to balance China’s influence in countries that stand to benefit from BRI with alternative financing for development projects. Competition in this regard is likely to be limited, at least initially. China has set aside between USD 4 trillion and USD 10 trillion to fund BRI projects – figures neither Japan nor India can realistically compete with in the short-to-medium term, given that Japanese institutions and companies are notoriously risk averse, and that India’s economy is characterised by significant internal inequality. Further, while the BRI is already a well-established element of China’s foreign policy agenda, backed by a strong government propaganda apparatus, the Quad and the AAGC continue to be at the planning stages, and limited details have emerged regarding the amount of investment involved.
The uncertainty surrounding the potential scope of joint initiatives between Japan and India makes it hard to predict their impact or success. It is important to remember that Japan is the world’s third largest economy, and that India is the world’s second most populous country, with a 2018-2019 economic growth forecast of 7.4 percent. As such, their co-operation could offer significant economic opportunities in the long term, as long as both countries ensure that they develop their initiatives peacefully and without appearing to threaten the BRI.