The Asia-Pacific Journal | Japan Focus Volume 8 | Issue 36 | Number 2 | Article ID 3406 | Sep 06, 2010

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India-Japan Ties Poised for Advance as Both Nations EyeChina　　印日関係、中国を意識しつつ進展へ向かう

Rajeev Sharma

India-Japan Ties Poised for Advanceas Both Nations Eye China

Rajeev Sharma

India and Japan are poised for a rapid advancein their bilateral relations with rich economicand strategic overtones. Straws in the windsuggest that India-Japan ties could reach ahistoric high by the year’s end, well beforeTokyo and New Delhi celebrate 60 years oftheir diplomatic relations. Though Japan andIndia have been in touch with each other forthe last 1500 years, modern diplomaticrelations were established on April 28, 1952.

The two countries are engaged in deepening ofbilateral ties in such diverse areas as defense,business, high technology trade, science andtechnology and culture and the process has

gained momentum over the last decade.However, the two powers will be crossing theRubicon if and when they sign the civiliannuclear cooperation agreement they arecurrently negotiating. The first round ofnegotiations on the nuclear deal was held onJune 28-29, 2010 in Tokyo with the Indian siderepresented by Gautam Bambawale, jointsecretary (East Asia) in the Ministry of ExternalAffairs, while Kitano Mitsuru, deputy-directorgeneral, Southeast and Southwest Asian Affairsdepartment, led the Japanese side.

New Delhi appears confident that it will be ableto address Japanese concerns amicably withoutyielding to Tokyo’s demand that the agreementinclude a clause that the deal will be off if Indiawere to conduct fresh nuclear weapon tests.The Indians faced a similar challenge whennegotiations with the United States for anuclear deal began in 2005. After protractedtalks, Washington agreed to drop its insistenceon incorporating a clause stipulating that the“deal is off if India conducts fresh tests”.Instead, India agreed to insert a clause in the123 US-India civilian nuclear agreement of2005 that it would return all American materialand equipment to Washington in the event of afresh Indian nuclear test. New Delhi will not beaverse to inclusion of a similar clause in thecivilian nuclear energy agreement with Japan,but nothing beyond that.

The tables seem to have turned between Indiaand Japan as far as civilian nuclear cooperationis concerned. It is Japan rather than India thaturgently needs to sign this agreement. ForIndia, the deal with Japan is important, nodoubt. It would further cement relations

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between the two Asian powers and lay thefoundation for more robust strategic ties in thelong term, with an eye on China. However, NewDelhi will not be much affected if the nucleardeal with Japan falls through because it hassigned similar deals with eight other countries -- France, US, Russia, Kazakhstan, Mongolia,Namibia, Argentina and Canada. The onlyproblem India would face if the India-Japannuclear deal falls through is that the US-Indianuclear deal will not be fully implemented astwo of the American giant companies involvedin nuclear energy -- General Electric andWestinghouse -- are wholly or partly controlledby Japanese companies.

Indian nuclear power plant

It is public knowledge that the French nucleargiant Areva and an American consortium led byGeneral Electric have each won orders for tworeactors in India, but they cannot implementthe projects without Japanese technology. BothAreva and GE use reactor vessels made byJapan Steel Works Ltd. In the case of GE, theAmerican conglomerate depends heavily onHitachi Ltd in nuclear reactor projects. It is inthis context that Japan is under immensepressure from both Washington and Paris tosign the nuclear deal with India as soon aspossible.

Moreover, Japan is eyeing the vast Indiannuclear market, which will generate businessand contracts worth an eye-popping $150billion in the next four to five years. Japancannot gain a share of this until it signs thenuclear deal with India. This would boost theprecarious Japanese economy. Japanesecompanies like Toshiba and Hitachi are keen ontapping the vast Indian nuclear market.

Japanese foreign minister Okada Katsuyavisited India on August 21 in the latest round ofthe India-Japan Strategic Dialogue. The talkscentered on Indo-Japan nuclear dealnegotiations, which began in Tokyo on June 28.Following the talks, Okada minced no words inwarning India that any nuclear deal betweenthe two nations would be off the moment Indiaconducted a fresh nuclear test. For its part,Indian strategists are confident that the issuecan be amicably resolved. The reason is thatIndia has no plans to test another nuclear bombon land, in the air or at sea because there is noneed to do so. In India and elsewhere, nucleartests are being, and will continue to be,conducted in laboratories. Indian diplomatswell understand Japanese sensitivity to issuesof nuclear testing. The Indian Prime Minister isscheduled to visit Japan in November orDecember for the annual India-Japan summitduring which the two sides hope to sign thedeal.

There is another reason for Japan to sew up thenuclear agreement without further ado. SouthKorea is also wooing India and is very keen onsigning a nuclear agreement. Seoul has alreadyinked a $20 billion project to build four nuclearreactors for UAE. Japan surely would not like tobe beaten by its regional rival for the Indiannuclear contract.

New Delhi is not sitting idle as China busilyenlarges its strategic footprint all around India.Defense Minister A K Antony will visit SouthKorea on September 2, the first time ever thatan Indian Defense Minister is undertaking an

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official trip to Seoul. The days when Delhi wasexclusively obsessed with Pakistan havepassed. This is a development that Japan will bewatching closely, given Tokyo’s intricaterelationship with Seoul.

Antony is leading a high-level delegation toSeoul that will include such senior civil andmilitary officials as Defense Secretary PradeepKumar, Vice Admiral RK Dhowan, Lt GeneralKT Parnaik, scientist Dr. Prahlada (a specialistin rockets and missile systems) and SundaramKrishna, Advisor to the Defense Minister.

The usually reticent Ministry of Defensecandidly put on record on August 31 thepurpose of Antony’s South Korea visit, saying:“The visit is part of India’s Look East Policy anda wide range of issues including DefenseCooperation for peace and stability in the Asia-Pacific region and bilateral cooperation inResearch and Development for manufacture ofmilitary equipment will figure prominentlyduring the discussion between Antony and thetop leadership of South Korea.” The phrase“peace and stability in the Asia-Pacific region”leaves no doubt that the two sides will bediscussing China’s recent moves andreiteration of maritime territorial claims inSouth China Sea.

On August 29, India took a major step inpreparing the way for Japanese participation inIndia’s civilian nuclear development programwhen it passed the Nuclear Liability DamageBill, critical legislation for implementing the123 agreement with the US on civilian nuclearpower. The bill provides the guaranteesdemanded by potential suppliers to protectthem against legal action in the event that theirequipment or materials are involved in anuclear accident within India. Washington hadmade it clear to New Delhi that Americannuclear vendors would not enter Indianmarkets unless suppliers of nuclear equipmentwere shielded from liability for nuclearaccidents. Currently, only the State-run

Nuclear Power Corporation of India Ltd. underthe existing Atomic Energy Act is empoweredto operate nuclear power plants.

Passage of the Nuclear Liability Bill, withcrucial support from the BJP opposition, is amajor political victory for Prime MinisterManmohan Singh coming ahead of USPresident Barack Obama’s scheduled India visitin November 2010.

However, the government will have to fightanother major battle in procuring land forconstruction of nuclear power plants. Landprocurement, particularly for nuclear plants, isa politically charged issue. India plans to invest$100 billion in nuclear power in the comingyears. It proposes to generate 20,000 MegaWatts (MW) of electricity from nuclear sourcesby 2020 from a mere 4500 MW of installedcapacity at present. India’s current totalinstalled electricity generation capacity is 164Giga Watts (GW), which is projected to rise to186 GW by March 2012.

Like US-India ties, India-Japan relations do notdepend exclusively on nuclear cooperation, butthe deal would take their strategic engagementto the next level.

Japan and India recently engaged in twoimportant events in New Delhi. On July 6,annual foreign office consultations were led byForeign Secretary Nirupama Rao and DeputyForeign Minister Sasae Kenichiro. India’sscience and technology and strategic programshad suffered a major setback when Japan,along with other developed nations, slappedsanctions on India after it tested five nucleardevices in May 1998. Japan had suspended hightechnology trade with India since most of thetechnologies that India sought from Japan andthe West were dual use technologies that couldbe put to civilian as well military use. ManyIndian entities like the Indian Space andResearch Organization (ISRO) and BhabhaAtomic Research Centre (BARC) had beenblacklisted by these nations. Sustained

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diplomatic efforts finally yielded fruits for Indiawhen Japan removed these Indian entities fromtheir negative lists, thus paving the way forhigh technology trade between the twocountries.

The two sides also reviewed progress on India-Japan flagship projects such as the DedicatedFreight Corridor (DFC) and the Delhi-MumbaiIndustrial Corridor (DMIC) and expressedsatisfaction on the steady momentum inimplementation of these projects.

The DMIC is a $90 billion investment involvingIndian and Japanese capital and stateinvestment that could transform India’seconomic landscape and strengthen businessbonds between the two nat ions . Thedevelopment, based on the Public-PrivatePartnership (PPP) model, will include aDedicated Freight Corridor (1515 Kms) and anIndustrial Corridor (150 Kms width on bothsides of the DFC). The project will encompass a400,000 sq. km area and will cover six statesencompassing close to 17% of India’spopulation. With completion scheduled for

2013, the implications above all for India’sNorthwest corridor are profound. Ports servingthe Western Dedicated Corridor includeMumbai, Jawaharlal Nehru Port (NaviMumbai), Pipavav, Kandla, Dholera, Navlakhi,Dahej, Mundra, Mandvi, Mahuva, Rewas, Dighi.In addition to augmenting such major ports asMumbai, seven new ports are to be developedin Gujarat and Maharashtra with 19 rail linksand 26 road links projected to promote portconnectivity. Major airport expansion is alsoprojected, with modernization of the Delhi andMumbai international airports and creation offour new international airports and high speedrail linkage between Mumbai and Ahmedabad.

At the July foreign office consultation, Japanand India pledged to continue to cooperate toreform the United Nations Security Council,including the Group of Four (G4) framework. The G4 must rank among the most notablediplomatic blunders in recent past by Japan aswell as the three other countries in the group –India, Germany and Brazil. The four nationsjoined together in 2004 to support each other’sbids for permanent seats on the United NationsSecurity Council with veto power. Quickly theyrealized their mistake of not factoring inacerbic regional politics, including the Chinafactor. Over 40 nations rose to oppose the G4plan, forming the Uniting for Consensusmovement, or the Coffee Club, led by Italy,South Korea, Mexico, Argentina and Pakistan,nations which would not tolerate seeing theirrespective rivals or arch-enemies at the hightable of world politics.

Japan’s bid was opposed tooth and nail byAsian neighbors China and South Korea;Germany’s by its neighbors Italy, Spain and theNetherlands. In consonance with regionalrivalries, in Latin America, Argentina andMexico opposed Brazil while in Asia, Pakistanand China thwarted India's bid. To add insult toinjury, in the course of the debate, Japan andGermany were singled out for war crimesduring the Second World War and Germany for

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the holocaust.

Japan became so bitter that in January 2006 itannounced that i t would not supportresubmitting the G4 resolution and wasworking on a resolution of its own. It signaledthe end of the road for G4 and the group hasdone nothing substantial since then. In short,G4 needs a ceremonial burial, which it has notyet received.

In May 2006 India and Japan put in place astructured framework of dialogue for defensecooperation and exchanges during the IndianDefense Minister’s visit to Japan. Then inDecember 2006 a new chapter opened in India-Japan relations with the establishment of theJapan-India Strategic and Global Partnership.The two countries have subsequently beenengaging with each other on practically everyissue of importance – defense, joint navalexercises, anti-piracy, disaster management,high technology, transport, infrastructure,energy and the fight against terrorism andtrans-national crimes. They have also beenpursuing bilateral cooperation in existingmultilateral frameworks in Asia, in particularthe East Asia Summit, ASEAN Regional Forum(ARF) and Regional Cooperation Agreement oncombating Piracy and Armed Robbery againstShips in Asia (ReCAAP) processes. WhenJapanese Prime Minister Abe Shinzo visitedIndia in August 2007, he and his Indiancounterpart Manmohan Singh unveiled aRoadmap for New Dimensions to the Strategicand Global Partnership.

Since then there has been incrementalprogress in India-Japan bilateral ties and thetwo nations are engaged in a number of officialdialogue mechanisms, covering a range ofsubjects. Ministerial-level dialogue mechanismsinclude Strategic Dialogue between ExternalAffairs Minister and Japan’s Foreign Minister,Policy Dialogue between Commerce andIndustries Minister and Japan’s Minister ofEconomy, Trade and Industry, and Energy

Dialogue between Deputy Chairman of thePlanning Commission and the JapaneseMinister of Economy, Trade and industry. InNovember 2009, they agreed to an annualexchange of visits at the level of DefenseMinisters, besides regular dialogues andexchanges at senior levels.

On July 6, 2010, the first-ever India-Japan 2+2dialogue was held, led by Nirupama Rao andDefense Secretary Pradeep Kumar for Indiaand Sasae Kenichiro and Vice Defense MinisterNakae Kimito for Japan. The Prime Ministers ofthe two na t i ons had agreed t o 2+2consultations at senior officials’ level in theAction Plan to advance Security Cooperation ofDecember 2009. Japan became the first countrywi th which Ind ia has he ld such 2+2consultations.

According to the Indian Ministry of ExternalAffairs, during the 2+2 consultations, each sideprovided the other with an exposition of itsdefense and security policies in the frameworkof their respective security environments. Inthis light, they reviewed the India-Japan JointDeclaration on Security Cooperation and theAction Plan to advance such cooperation. Theydiscussed non-traditional threats to securityand reviewed ways to strengthen cooperationin anti-piracy operations in the Gulf of Adenand holding of joint naval exercises. The nextround of the 2+2 dialogue will be held in Tokyoin 2011.

Meanwhile, the two sides have established anextensive strategic cooperation mechanismwhich includes the following:

• Annual Strategic dialogue atForeign Minister-level

• Regular Consultations betweenNational Security Advisor of Indiaand Japanese Counterpart

• Annual Subcabinet/Senior

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Officials 2+2 dialogue (Ministry ofForeign Affairs and Ministry ofDefense of Japan / Ministry ofExternal Affairs and Ministry ofDefense of India)

• Foreign Secretary / Vice Ministerlevel Dialogue (Basically twice ay e a r ) • F o r e i g n O f f i c eConsultations (Basically once ayear)

• Annual Comprehensive SecurityDialogue at the level of JointSecretary, Ministry of ExternalAffairs (MEA) and Ministry ofDefense (MOD) of India / DirectorGeneral, Ministry of ForeignAffairs (MOFA) and Ministry ofDefense (MOD) of Japan

• Maritime Security Dialogue

• Regu lar meet ings o f theMinisters of Defense

• Annual Defense Policy Dialogueat the level of Defense Secretary /Administrative Vice-Minister ofDefense

• Regular reciprocal visits betweenService Chiefs of both sides

• Annual bilateral naval exercises,alternately off India and Japan, toenhance cooperation and corecapabilities for maritime operationand disaster relief

• Multilateral Naval Exercises,when possible

• Cooperation in anti-piracyoperations between the IndianNavy and the Japanese SelfDefense Force

Powerful economic and strategic factorswarrant Japan signing the civilian nuclearcooperation agreement with India. Japan’shuge government debt to the tune of nearly200 per cent of its GDP is a warning bell thatthe government of Prime Minister Kan Naotocannot ignore. A nuclear deal with India wouldopen the lucrative Indian nuclear market toJapan.

Japan shed its nuclear inhibitions in September2008 (following a great deal of persuasion bythen US President George W. Bush) and votedin favor of an India-specific waiver at theNuclear Suppliers’ Group. In a sense, Japan lostits non-proliferation virginity at the NSG nearlytwo years ago. Moreover, India’s track recordin non-proliferation has been impeccable – incontrast to that of Pakistan.

Pres. Bush and Prime Minister Singh

In the coming year, Japan will cede to Chinathe number two rank in the world economy. China poses the biggest strategic challenge toboth Japan and India, neither of which is apotential security threat to the other in thenear or distant future.

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Indian strategists view with alarm not onlyChina’s surging economy, but also its expansivemilitary thrust and infrastructural advance.China is moving at breakneck speed to buildtransportation infrastructure including roads,rail lines, airports and seaports on themainland, in Tibet and in India’s neighbouringcountries including Pakistan, Bangladesh, SriLanka, Nepal and Myanmar that threatensIndia with strategic encirclement. The Beijing-Lhasa rail link, completed in 2006, is just aprecursor. In contrast, India will not be able tomake the projected 345-km-long Jammu-Udhampur-Srinagar-Baramulla railway lineoperational till 2017. The Tibet rail network,with planned expansion to Nepal, enablesChina to amass large number of troops and warparaphernalia on Indian borders in a matter ofdays.

China has also unveiled plans to build a trans-Karakoram rail link to Pakistan through theGilgit-Baltistan region which India views as anintegral part of the original Jammu andKashmir that has been contested with Pakistanfor over six decades. The proposed nearly 700-km-long railway line will link Kashgar in

Xinjiang province to Havelian near Rawalpindiin northern Pakistan through the KhunjerabPass, further raising Indian strategic concerns.

Indeed, China’s growing power lies behind therecent strengthening of India-Japan ties and USsupport for the evolving relationship.

Rajeev Sharma is a New Delhi-based journalist-author and commentator on strategic issues,international relations and terrorism.bhootnath004@yahoo.com). The author ofseven books, five non-fiction, his last non-fiction work is Global Jihad: Current Patternsa n d F u t u r e T r e n d s(http://www.amazon.com/dp/8174790535/?tag=theasipacjo0b-20), published in 2006. His lastbook was a thri l ler, Sting in the Tale(http://www.amazon.com/dp/8174790926/?tag=theasipacjo0b-20) (2008). He wrote this articlefor The Asia-Pacific Journal.

Recommended citation: Rajeev Sharma, "India-Japan Ties Poised for Advance as Both NationsEye China," The Asia-Pacific Journal, 36-2-10,September 6, 2010.

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(http://www.amazon.com/dp/8174790926/?tag=theasipacjo0b-20)

Click on the cover to order.