Tracking India’s Act East Policy

20 August 2021

India’s Act East Policy was initiated by Prime Minister Modi in November 2014 to shift the country’s engagement with ASEAN to a higher trajectory. This policy was an extension of the 1991 Look East Policy which laid the framework for India’s economic and strategic cooperation with the ASEAN countries. The Look East Policy remained in force until the new National Democratic Alliance (NDA) government came to power in 2014. Although India-ASEAN relations improved due to this policy, the implementation of several ambitious infrastructure and connectivity projects (such as the Kaladan Multi-Modal Transit Facility and the India–Myanmar–Thailand Trilateral Highway) remained slow. Hence, the strengthened relations did not lead to expected gains in inter-regional trade or improved connectivity (either via land or sea). With the Act East Policy, the NDA government seemed to herald a more proactive approach by declaring the speeding up of connectivity, commercial and cultural links with countries to India’s east.

In the current global environment, no nation can afford to be complacent, and eight years on the Act East Policy has been extended to encompass the larger concept of the Indo-Pacific. There are two main reasons for this. First, India is acknowledged as a crucial and strategic stakeholder in maintaining stability and security in the region, and second, linkages with this broader region provide greater opportunities for domestic economic growth and security.

The China factor

In recent years, China has made several unprovoked incursions into India’s territory (such as into the Galwan Valley in June 2020), undertaken construction along the Line of Actual Control in Arunachal Pradesh, and made frequent attempts to get a foothold in India’s neighbourhood through the development of several deep-sea ports in the Bay of Bengal and Indian Ocean Region (such as Kyaupkyu in Myanmar, Chittagong in Bangladesh, Gwadar in Pakistan, and Hambantota in Sri Lanka). This has compelled India to seek deeper and stronger relations with like-minded countries such as the United States, Japan, Australia, and ASEAN, all of whom support India’s central role in ensuring maritime security in the Indian Ocean Region (IOR).

While India’s Act East Policy may sometimes appear to fall short in the implementation of specific projects, there is a resurgence marked by the convergence of strategic and security interests and a mutual desire for greater economic engagement.

The need to face these serious challenges in the Indo-Pacific was outlined by Prime Modi in November 2019 when he spoke of “global challenges facing the world today including rules-based international order in the Indo-Pacific region” and highlighted the need for “working together to find out common solutions”. With expanding regional trade and energy markets, an integrated approach for combating traditional and non-traditional threats has led to India signing comprehensive strategic partnerships with several countries in the Indo-Pacific including Australia, Indonesia and Vietnam. Regional stakeholders are contending with new and evolving geopolitical equations such as the rising tension between Japan and China, the cooling of the United States’ relations with China and Russia, and the emerging situation in Afghanistan. India will continue to play a pivotal role in building consensus while safeguarding its national interests.

Now more than ever there are genuine challenges to ASEAN's security with China's claim to the whole of the South China Sea potentially jeopardising the freedom of the seas. However, despite Beijing's incursions into their waters (such as Chinese fishing boats illegally venturing into Indonesia’s Exclusive Economic Zone and being expelled by military action), ASEAN nations are mostly reluctant to openly speak up against China, their largest trading partner. India, on the other hand, has been vocal in supporting the freedom of navigation in international waters, including the South China Sea, and this is reflected in India’s strong statement at the ASEAN Defence Ministers Meet in June 2021 where Defence Minister Rajnath Singh said, “The sea lanes of communication are critical for peace, stability, prosperity and development of the Indo-Pacific region. In this regard, developments in the South China Sea have attracted attention in the region and beyond”. This viewpoint has also been consistently reflected in the Indian Navy’s Indian Maritime Security Strategy.

India has also been developing closer links with the Indo-Pacific and beyond by conducting joint naval exercises with select ASEAN countries, as well as Australia, France, and the United States. India’s participation with Japan, Australia, and the US in the Quad is a positive step towards maintaining freedom of navigation. This was emphasised by Prime Minister Modi in his address at the first leadership summit of the Quad in March 2021 when he stated “We are united by our democratic values and our commitment to a free, open and inclusive Indo-Pacific. Our agenda, covering areas like vaccines, climate change, and emerging technologies make the Quad a force for global good. We will work together, closer than ever before on advancing our shared values and promoting a secure, stable and prosperous Indo-Pacific”. However, India is carefully balancing its engagement with the Quad as it is unwilling to join a formal military alliance/bloc reminiscent of the Cold War and wants to uphold its long-standing relationship with Russia.

Becoming a constructive regional player

In Prime Minister Modi's second term, the Act East Policy has spotlighted and re-emphasised two key areas. With an aggressive China on its borders, India is giving primacy to the development of its Northeast region including by inviting investments from its development partners and multilateral agencies. At a recent webinar at which representatives of Australia and Japan were also present, India’s Secretary (East) stated that “the North-East is India's gateway to East & Southeast Asia and it is indeed a region where 'Neighborhood First' & 'Act East' converge & complement each other”.

India is also engaging with neighbouring countries through the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Co-operation (BIMSTEC). Reasons for this include a desire to find a working alternative to the South Asian Association for Regional Cooperation (SAARC), deepening links towards India’s east to balance the situation on its western front, and to counter China’s presence. Prime Minister Modi’s second term has seen a reinvigoration of this relationship and his new Foreign Minister’s enthusiasm for BIMSTEC is reflected in the statement, “I think what we see today is an energy in BIMSTEC, a possibility in BIMSTEC, a mindset in BIMSTEC which fits in with that optimistic vision of economic cooperation that India is looking to take forward”. With the increasing complexity of the challenges faced by its member states, BIMSTEC’s success depends on how adeptly it can navigate the geopolitics of interdependence.

Given all this, India’s refusal to sign the Regional Comprehensive Economic Partnership (RCEP) may appear to be contrary to the Act East Policy. However, the reason was spelt out by the Indian Foreign Minister and later by Prime Minister Modi himself when they stated that this was in keeping with India’s national interests as some of the clauses of RCEP were not mutually beneficial and would harm India's domestic economic interests. Concerns include potential import influxes from countries like China, the inability to increase tariffs on imports, and India’s current unfavourable trade balance with several RCEP members despite Free Trade Agreements with some of them. This was explained by Foreign Minister Jaishankar as “In the name of openness, we have allowed subsidised products and unfair production advantages from abroad to prevail. And all the while, this was justified by the mantra of an open and globalised economy”.

The ASEAN nations appear to have understood this viewpoint by keeping open a window for India to join the RCEP at a later stage. This suggests that while there may be a divergence of views in the present and potentially the future, these are unlikely to impact the robustness of the India-ASEAN partnership. The joint belief in the new geopolitics of interdependence and the value of a connected neighbourhood strongly indicates that ASEAN remains important in India’s foreign policy.

While India’s Act East Policy may sometimes appear to fall short in the implementation of specific projects, there is a resurgence marked by the convergence of strategic and security interests and a mutual desire for greater economic engagement. India is not a spectator but a decisive and constructive player in the strategic future of the Indo-Pacific. Looking ahead, India must ensure that its Act East Policy continues to remain relevant and realistic with a focus on connectivity, commerce and, most of all, security.

DISCLAIMER: All views expressed are those of the writer and do not necessarily represent that of the 9DASHLINE.com platform.

Author biography

Professor Man Mohini Kaul is one of India’s leading academics and writers on international relations. She retired in 2017 from the Jawaharlal Nehru University (JNU), New Delhi, where among other positions she was Chairperson of the Centre for South, Central, Southeast Asian and South-West Pacific Studies, School of International Studies. Image credit: Flickr/MEAphotogallery.