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Subject: Bilateral Relations

1. Major World Events
2. India’s Interests in neighbourhood
3. Effects of our Policies

  • Lessons on navigating the evolving geopolitics in the Middle East

    Context

    The US President’s visit to Saudi Arabia and Israel highlights not only some new trends that are reshaping the region but also eternal truths about international politics that are lost in the din of public discourse about the Middle East.

    What is the significance of the visit

    1] The US is not abandoning the Middle East

    • Contrary to the popular perception in the US, the region, and India, the US is not about to abandon the Middle East.
    • Many in the US political class believed that given America’s oil independence from the Middle East no longer needed the region.
    • American withdrawal from Afghanistan last year intensified these concerns and the region looked for alternative means to secure itself.
    • But as in the Indo-Pacific and Europe, the Biden Administration has concluded that it can’t cede its regional primacy in the Middle East and is ready to reclaim its leadership.
    • But as in the Indo-Pacific and Europe, the Biden Administration has concluded that it can’t cede its regional primacy in the Middle East and is ready to reclaim its leadership.

    2] No direct involvement

    • While the US will stay put in the Middle East, it is certainly changing the manner in which it acts.
    • In the past, the US saw itself as the sole provider of regional security and was ready to send its troops frequently into the region.
    • While the US does not want to be drawn directly into the region’s wars, it is determined to help its partners develop capabilities to secure themselves.
    • Arab-Israel reconciliation: Efforts are also being taken to produce greater reconciliation among Arabs and Israel and create stronger networks within and beyond the region to strengthen deterrence against adversaries.
    • The current effort to craft a Middle East Air Defence coalition is an example of this,
    • The I2U2 signals that the US no longer views the Middle East in isolation from its neighbourhood.

    3] Setting aside the differences on democracy vs autocracy debate

    • Biden had to modify his sweeping rhetoric about the “conflict between democracies and autocracies” as the principal contradiction in the world.
    • To sustain the US position in the region, Biden had no option but to sit with leaders of monarchies and autocracies that are America’s long-standing partners.

    4] Nation above identities

    • Biden’s focus on national interest found an echo in the Middle East, which is learning to put nation above other identities such as ethnicity and religion.
    • In the past, the region seemed immune to nationalism as it focused on transcendental notions of “pan Arabism” and “pan Islamism”.
    • Although the idea of Arab solidarity on the Palestine issue endures, many Arab leaders are not willing to let that come in the way of normalisation of relations with Israel.
    • A critical section of the Arabs, long seen as irreconcilably opposed to Israel, are now joining hands with the Jewish state to counter threats to their national security from Iran.
    • Many Gulf kingdoms, including Saudi Arabia and the UAE, are now consciously promoting a national identity among their peoples.
    •  Despite shared religion, Turkey’s leader Recep Erdogan has in recent years sought to undermine many of the Arab regimes.
    • Qatar has often found itself closer to non-Arab Turkey and in opposition to its Gulf Arab neighbours.

    Conclusion

    Delhi, whose Middle East policy today is imbued with greater realism, can hopefully discard the inherited ideological inertia, avoid the temptation of seeing the Middle East through a religious lens, and strive hard to realise the full possibilities awaiting India in the region.

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  • Pakistan and IMF talks: What lies ahead?

    The latest IMF press release maintains it would consider an extension of the current Extended Fund Facility (EFF) to end June 2023 and augment the fund amount to $7 billion for Pakistan.

    Pakistan seeks IMF bailout

    • Surprisingly, it took five months to reach the staff-level agreement.
    • The total disbursement under the current EFF to Pakistan has now been $4.2 billion.
    • The talks were originally aimed at releasing a tranche of $900 million.

    What is Extended Fund Facility (EFF)?

    • The EFF was established by the IMF to provide assistance to countries experiencing serious payment imbalances because of structural impediments or slow growth and an inherently weak balance-of-payments position.
    • An EFF provides support for comprehensive programs including the policies needed to correct structural imbalances over an extended period.

    What was the Pakistani EFF?

    • The 39-month EFF between the two was signed in July 2019 to provide funds amounting to Self-Drawing Rights (SDR) — $4,268 million.
    • The EFF was signed by Pakistan to address the medium-term balance of payment problem, and work on structural impediments and increase per capita income.

    Why did the talks take longer to conclude?

    • The IMF placed demands (all of which seem impossible for Pakistan) includes :
    1. Fiscal consolidation to reduce debt and build resilience
    2. Market-determined exchange rate to restore competitiveness
    3. Eliminate ‘quasi-fiscal’ losses in the energy sector and
    4. Strengthened institutions with transparency
    • Ousted Pakistani PM eased fuel prices. This was considered a major deviation under the EFF benchmarks.
    • Then govt gave tax amnesties to the industrial sector, impacted the tax regime and a structural benchmark for fiscal consolidation.
    • The IMF insisted on its demands before approving any release of the tranche.

    How important is the IMF support to Pakistan?

    • Pakistan’s economic situation is dire.
    • According to the Economic Survey of Pakistan 2022, the fiscal deficit in FY 22 was $18.6 billion, and the net public debt at $252 billion, which is 66.3% of the GDP.
    • The power sector’s circular debt is $14 billion.

    Why have the Pakistan-IMF relations remained complicated?

    • Structural reforms require long-term commitment, which have been sacrificed due to Pakistan’s short-sighted political goals.
    • Hence the urge to go to the IMF for fiscal stability has been repeated over time.

    Risks posed by a failed Pakistan

    • There is also a narrative that Pakistan has the fifth largest population with nuclear weapons that cannot be allowed to fail.
    • A section within Pakistan also places the geo-strategic location of the country would provide an edge for cooperation, rather than coercion.
    • Hence, this section believes, the IMF would continue to support.
    • Given the IMF’s increased assertion, Pakistan’s political calculations and the elections ahead, the relationship between the two is likely to remain complicated.

    What lies ahead for Pakistan and the IMF?

    • Despite the latest agreement, the road ahead for the IMF and Pakistan is not an easy one.
    • Political calculations and the elections ahead will play a role in Pakistan’s economic decision-making.
    • However, one thing is eminent Pakistan will certainly collapse someday badly like Sri Lanka.

    Try this PYQ from CSP 2022

    “Rapid Financing Instrument” and “Rapid Credit Facility” are related to the provisions of lending by which one of the following?

    (a) Asian Development Bank

    (b) International Monetary fund

    (c) United National Environment Programme Finance initiative

    (d) Word bank

     

    [wpdiscuz-feedback id=”md50hycvo5″ question=”Please leave a feedback on this” opened=”1″]Post your answer here.[/wpdiscuz-feedback]

    Back2Basics: Special Drawing Rights (SDRs)

    • SDRs, created by the IMF in 1969, are an international reserve asset and are meant to supplement countries’ reserves.
    • Adding SDRs to the country’s international reserves makes it more financially resilient.
    • Providing liquidity support to developing and low-income countries allows them to tide over the balance of payments (BOP) situations like the one India has been experiencing due to the pandemic and the one it faced earlier in 1991.
    • SDRs being one of the components of foreign exchange reserves (FER) of a country, an increase in its holdings is reflected in the BOP.

     

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  • In news: India-Bhutan Relations

    After over two years of the COVID-19-induced lockdown, Bhutan will open its doors to tourists on September 23 with a new expensive policy for Indians and other foreign tourists.

    India-Bhutan Relations: A backgrounder

    • India and Bhutan have had long-standing diplomatic, economic and cultural relations
    • Bhutan and India relations are governed by a friendship treaty that was renegotiated only in 2007, subjecting the Himalayan nation’s security needs to supervision.
    • Treaty of Friendship in 2007, which brought into the India-Bhutan relationship “an element of equality.”
    • The Treaty provides for perpetual peace and friendship, free trade and commerce, and equal justice to each other’s citizens.

    What is the Treaty of Friendship?

    • On August 8, 1949, Bhutan and India signed the Treaty of Friendship, calling for peace between the two nations and non-interference in each other’s internal affairs.
    • India re-negotiated the 1949 treaty with Bhutan and signed a new treaty of friendship in 2007.
    • The new treaty replaced the provision requiring Bhutan to take India’s guidance on foreign policy with broader sovereignty and not require Bhutan to obtain India’s permission over arms imports.
    • Under the 2007 India-Bhutan Friendship Treaty, the two sides have agreed to “cooperate closely with each other on issues relating to their national interests.”
    • Neither Government shall allow the use of its territory for activities harmful to the national security and interest of the other

    Various facets of ties

    (1) Commercial Relations

    • India is Bhutan’s largest trading partner.
    • India and Bhutan have signed an Agreement on Trade, Commerce and Transit on in 2016, which provides for a free trade regime between the two countries.
    • Tourism is another point of convergence.

    (2) Energy Cooperation

    • A scheme titled “Comprehensive Scheme for Establishment of Hydro-meteorological and Flood Forecasting Network on rivers Common to India and Bhutan” is in operation.
    • The network consists of 32 Hydro-meteorological/ meteorological stations located in Bhutan and being maintained by the Royal Government of Bhutan with funding from India.
    • The data received from these stations are utilized in India for formulating flood forecasts.

    Significance of Bhutan to India

    • Buffer to China: Bhutan is a buffer state between India and China. Bhutan shares a 470 km long border with China.
    • Vital connectivity through chicken’s neck: The Chumbi Valley is situated at the tri-junction of Bhutan, India and China and is 500 km away from the “Chicken’s neck” in North Bengal.
    • Security in North-East: Bhutan has in the past cooperated with India and helped to flush out militant groups in NE.
    • Chinese inroad in Bhutan: China is interested in establishing formal ties with Thimphu, where it does not yet have a diplomatic mission.

    China factor in ties: China predates on small neighbours

    • Bhutan is strategically important for both India and China. Chinese territorial claims in western Bhutan are close to the Siliguri Corridor.
    • Beijing is reportedly insisting on Bhutan establishing trade and diplomatic relations as a quid pro quo for a border settlement.
    • Bhutan is currently India’s only neighbour who has stayed away from joining China’s Belt and Road Initiative (BRI), but that may change if India can’t make itself an attractive ally and neighbour.

    Why does India need Bhutan?

    • Bhutan has always been India’s most trusted ally in South Asia and has often put India’s security at the forefront.
    • Come to think of it, in December 2003, Bhutan’s fourth king personally led the army to throw out Indian militants living in Bhutan’s jungles.
    • Bhutan was also the only South Asian country besides India not to attend China’s Belt and Road Initiative forum in May 2017.
    • In other words, land-locked Bhutan has held its end of the bargain.

    Various cooperation developments

    • Maitri Initiative: Bhutan is the first country to receive the Covishield vaccines under India’s Vaccine Maitri Initiative.
    • Financial connectivity: It has touched new heights through the launch of the RuPay card and the BHIM app.
    • Start-Up ecosystem: Both nations successfully linked up the Start-Up systems of our two countries via structured workshops; through the National Knowledge Network & the Druk-REN connection.
    • E-Library project: It has opened up new vistas of education and knowledge sharing between two countries.

    Irritants in ties

    • India has not invested in significantly in Bhutan and other smaller neighbours that modicum of trust which is critical in building genuine goodwill.
    • This means not only increasing people-to-people contact but also being sensitive to Bhutan’s desire for a wider engagement beyond India’s borders. This means respecting Bhutan as an equal, sovereign nation-state.

    Conclusion

    • The Indo-Bhutan friendship is built on shared values and aspirations, trust and mutual respect.
    • Bhutan’s foreign policy framework holds the relationship with India as being integral to its national interest.
    • The Indian approach to Bhutan has necessarily to be tailored while being sensitive to the growing Bhutanese aspirations of being considered equal.

     

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  • The Ukraine war and the return to Euro-centrism

    Context

    The Russian aggression against Ukraine has led to an unmissable feeling of insecurity in Europe, particularly in Germany.

     Euro-centric world order and new security consciousness

    • For centuries, Europe imagined itself to be the centre of the world — its order, politics and culture.
    • What contributed to its decline? Decolonisation, the emergence of the United States as the western world’s sole superpower, and the rise of the rest dramatically diminished the centuries old domination of the European states and their ability to shape the world in their own image.
    • The political and military aftermath of Russia’s war on Ukraine could potentially tilt the current global balance and take us back to a Euro-centric world order.
    • US dominance: For sure, the U.S. continues to dominate the trans-Atlantic security landscape and this is likely to remain so.
    • And yet, the new security consciousness in Europe will reduce Washington’s ability to continue as the fulcrum of the trans-Atlantic strategic imagination.
    • If wars have the potential to shape international orders, it is Europe’s turn to shape the world, once again.
    • The United States, fatigued from the Iraq and Afghan wars, does not appear to be keen on another round of wars and military engagements.
    •  A pervasive sense of what some described as “existential insecurity” has brought about a renewed enthusiasm about the future of the European Union and the North Atlantic Treaty Organization (NATO).
    • The European Union (EU) Commission has backed Kyiv’s bid for EU candidature.
    • This new military unity is not just words, but is backed with political commitment and financial resources from the world’s richest economies.
    • Berlin, for instance, has decided to spend an additional €100 billion for defence over and above its €50 billion annual expenditure on defence.

    Implications

    1] Weakened faith in the institutions and globalisation

    • Germany, the engine of this new security thinking in Europe, is coming out of its self-image of being a pacifist nation.
    • There appears little faith in the United Nations or the UN Security Council anymore in Berlin, they have decided to put their faith in a revitalised EU and NATO.
    • European states are deeply worried about globalisation-induced vulnerability and this has set in a rethink about the inherent problems of indiscriminate globalisation.
    • The combined effect of European re-militarisation (however modest it may be for now), its loss of faith in multilateral institutions, and the increased salience of the EU and NATO will be the unchecked emergence of Europe as an even stronger regulatory, norm/standard-setting superpower backed with military power.

    2] Unilateral and Euro-centric decision making

    • The EU already has a worryingly disproportionate ability to set standards for the rest of the world.
    • Instruments such as the Digital Services Act and the Digital Assets Act or its human rights standards will be unilaterally adopted, and will be unavoidable by other parts of the world.
    • While these instruments and standards may in themselves be progressive and unobjectionable for the most part, the problem is with the process which is unilateral and Euro-centric. 

    3] Euro-centric worldview

    • A euro-centric worldview of ‘friends and enemies’ will define its engagement with the rest of the world.
    • India is a friend, but its take on the Ukraine war is not friendly enough for Europe.
    • The EU will lead the way in setting standards for the rest of us and we will have little option but to follow that.
    • For sure, Europe will seek partners around the world: to create a Euro-centric world order, not a truly global world order.

    4] Dilemma for India

    • This unilateral attempt to ‘shape the world’ in its image will also be portrayed as an attempt to counter Chinese attempts at global domination.
    • To oppose or not? When presented as such, countries such as India will face a clear dilemma: to politically and normatively oppose the setting of the global agenda by Europeans or to be practical about it and jump on the European bandwagon.

    Conclusion

    The key message from the European narratives about the Ukraine war is that European states would want to see their wars and conflicts as threatening international stability and the ‘rules-based’ global order.

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  • India-South Korea Relations

    Context

    • During the past five years, India and South Korea have experienced considerable divergence in their respective national objectives.

    Background

    India–South Korea relations - Wikipedia

    • Bilateral relations between India and South Korea, officially known as the Republic of Korea, were established in 1962 and upgraded to Ambassador-level in 1973.
    • South Korea’s open market policies found resonance with India’s economic liberalization, and its ‘look east policy’ and ‘act east policy’.
    • The relations has become truly multidimensional, spurred by a significant convergence of interests, mutual goodwill and high level exchanges.
    • During PM Modi’s visit to ROK in May 2015, the sides elevated the ties to ‘Special Strategic Partnership’.
    • President Moon’s India visit marked the 45th anniversary of bilateral diplomatic ties.

    Why India is important for South-Korea?

    • One of the points that the Koreans have been making to India is that they see India as a country that is now strategically important to them
    • South Korea also finds in India a very acceptable partner.
    • India doesn’t have edges which can create problems for them. They are aware of one factor which they have grown up with, which is the Pakistan factor.
    • With new issues cropping up in ties with China and America, export-driven South Korea must find new markets.
    • South Korea’s economic growth has slowed, presenting it with important challenges.
    • South Korea is targeting economies with the greatest growth potential like India.
    • South Korea is too heavily dependent on China’s market. So diversification is essential for South Korea..
    • Need cooperation for development in third countries, like capacity building programmes in Africa

    India – South Korea Relations

    • Political:
      • In May 2015, the bilateral relationship was upgraded to ‘special strategic partnership’.
      • India has a major role to play in South Korea’s Southern Policy under which Korea is looking at expanding relations beyond its immediate region.
      • Similarly, South Korea is a major player in India’s Act East Policy under which India aims to promote economic cooperation, cultural ties and develop strategic relationships with countries in the Asia-Pacific.
    • Regional Stability:
      • The regional tensions in South Asia especially between India and China create a common interest for India and South Korea.
      • This could be a collaborative approach for regional stability.
    • Nuclear: 
      • South Korea’s key interest in managing their nuclear neighbour (North Korea) is similar to India’s considerations toward Pakistan.
      • The US alliance system, established with South Korea and Japan, puts pressure on North Korea to cap its nuclear programme.
      • Containing North Korea is beneficial to India’s economic and regional ambit in East Asia.
      • It also adds to its approach to the nuclear non-proliferation regime as a responsible nuclear state.
    • Economic:
      • The current bilateral trade between India and South Korea is at USD 21 billion and the target that has been set is USD 50 billion by the year 2030.
      • India and South Korea have signed the Comprehensive Economic Partnership Agreement (CEPA), 2010 which has facilitated the growth of trade relations.
      • To facilitate investment from Korea, India has launched a “Korea Plus”facilitation cell under ‘Invest India’ to guide, assist and handhold investors.
    • Diplomatic:
      • There is a long-lasting regional security dilemma with the continued verbal provocations and a conventional arms race.
      • Thus, despite the alliance system, Seoul appears to be searching for a stronger diplomatic stand on imminent regional issues beyond the alliance system.
      • South Korea’s approach to India comes with strategic optimism for expanding ties to ensure a convergence of interest in planning global and regional strategic frameworks.
    • Cultural:
      • Korean Buddhist Monk Hyecho or Hong Jiao visited India from 723 to 729 AD and wrote the travelogue “Pilgrimage to the five kingdoms of India” which gives a vivid account of Indian culture, politics & society.
      • Nobel Laureate Rabindranath Tagore had composed a short but evocative poem – ‘Lamp of the East’ – in 1929 about Korea’s glorious past and its promising bright future.

    Challenges

    • Stagnation in Economic relationship:
      • The economic partnership is struck at $22 billion annually.
      • Also, the defence partnership appears to have receded from great all-round promise to the mere sale and purchase of weapon systems.
      • Trade between the two countries was sluggish and there was no major inflow of South Korean investment into India.
      • No upgrade in CEPA: India and South Korea were also trying to upgrade their Comprehensive Economic Partnership Agreement (CEPA) agreement, but to no avail.
    • Cultural Prejudices on both sides preventing people-to-people ties
      • Cold War Era perception: There may be a widespread perception among South Koreans of India as a third world country, rife with poverty and hunger.?
      • Indian Diaspora: Within South Korea, the integration of Indians in the local population is far from complete, with some instances of racial prejudice or discrimination toward Indians
      • Inadequate acknowledgment of Korean Culture: To a certain extent Indians are unable to distinguish between the cultural and social characteristics of South Koreans from that of Japanese/Chinese.
    • Unfulfilled potential of Cultural Centres
      • Indian Culture Centre (ICC) was established in Seoul 10 years ago?to promote people-to-people contacts.
      • However, ICC has to reach an exponentially wider audience and its focus has to expand beyond the urban, English-speaking elite of Seoul.
      • The same may be applicable to South Korean culture centres in India.
    •  Divergence in objectives
    • During the past five years, India and South Korea have experienced considerable divergence in their respective national objectives.
    • There was a clear drift by South Korea away from multilateral security initiatives led by the United States, such as the Quad (the U.S., Australia, India and Japan); meanwhile, India has been actively participating in them.

    Change in Korean foreign and security policies and opportunities for India

    • The newly elected Korean President, Yoon Suk Yeol, has brought about a paradigm shift in South Korean foreign and security policies.
    • He has proposed that South Korea should step up to become a “global pivotal state, anchored in liberal values and a rules-based order”.
    • Opportunities for India: South Korea’s new willingness to become a global pivotal state and play an active role in regional affairs is bound to create multiple opportunities for a multi-dimensional India- Korea partnership.
    • South Korea’s strategic policy shift to correct its heavy tilt towards China is bound to bring new economic opportunities for both countries.
    • The trade target of $50 billion by 2030, which looked all but impossible a few months ago, now seems within reach.
    • Convergence of capabilities: The emerging strategic alignment is creating a new convergence of capabilities and closer synergy in new areas of economic cooperation such as public health, green growth, digital connectivity, and trade, among others.
    • With the strategic shift in South Korea’s defence orientation, new doors of cooperation for defence and security have emerged.
    • Defence cooperation: Advanced defence technologies and modern combat systems are the new domains for the next level of defence cooperation between the two countries.
    • A Roadmap for Defence Industries Cooperation between the Republic of India and the Republic of Korea (ROK) was signed in 2020.
    • Maritime security: South Korea’s participation in additional maritime security activities in the Indian Ocean, such as the annual Malabar and other exercises with Quad countries, will further strengthen India’s naval footprint in the Indo-Pacific region.
    • Defence policy coordination: The shift in South Korean policies will enable a strong India, South Korea and Japan defence policy coordination that could effectively forge new joint regional security policies.

    Challenges

    • Chinese pressure: The Chinese leadership is adversely impacted by policy changes brought in by the Yoon administration.
    • The real challenge for global geopolitics is this: can South Korea withstand the inevitable Chinese pressure and stick to its new alignment?
    • Tension with North Korea: South Korea’s peace process with North Korea has completely collapsed.
    • In the coming days, as North Korea conducts more missile and nuclear tests, it may lead to regional tension.
    • Any breakout of hostilities on the Korean Peninsula can derail South Korea’s Indo-Pacific project.

    Way forward

    • Strategic partnership: India has evolved excellent strategic partnerships with Japan, Vietnam and Australia.
    • South Korea could be the fourth pillar in India’s Indo-Pacific strategy along with Japan, Australia, and Vietnam.
    • This can bring about a paradigm shift in India’s position and influence in the region.
    • The time has come for the Indian and South Korean bilateral partnership to be strategically scaled up at the political, diplomatic and security domain levels.
    • With South Korea’s emergence as a leader in critical technologies, cybersecurity and cyber-capacity building, outer space and space situational awareness capabilities, South Korea can contribute immensely to enhance India’s foundational strengths in the Indo-Pacific.
    • India can help South Korea withstand Chinese pressure and North Korean threats.
    • This new partnership can have a long-term positive impact for both countries and the Indo-Pacific region.
    • It is an opportunity that neither country can afford to miss.

    Conclusion

    An independent, strong, and democratic South Korea can be a long-term partner with India, that will add significant value to India’s Indo-Pacific strategy.

     

  • Places in news: Paracel Islands

    A US destroyer sailed near the disputed Paracel Islands in the South China Sea, drawing an angry reaction from Beijing, which said its military had “driven away” the ship.

    About Paracel Islands

    • The Paracel Islands, also known as the Xisha Islands and the Hoang Sa Archipelago are a disputed archipelago in the South China Sea.
    • The archipelago includes about 130 small coral islands and reefs, most grouped into the northeast Amphitrite Group or the western Crescent Group.

    What is the South China Sea Dispute?

    • It is a dispute over territory and sovereignty over ocean areas, and the Paracels and the Spratlys – two island chains claimed in whole or in part by a number of countries.
    • China, Vietnam, the Philippines, Taiwan, Malaysia, and Brunei all have competing claims.
    • Alongside the fully-fledged islands, there are dozens of rocky outcrops, atolls, sandbanks, and reefs, such as the Scarborough Shoal.
    • China claims by far the largest portion of territory – an area defined by the “nine-dash line” which stretches hundreds of miles south and east from its most southerly province of Hainan.
    • Beijing says its right to the area goes hundreds of centuries to when the Paracel and Spratly island chains were regarded as integral parts of the Chinese nation.
    • It showed the two island groups falling entirely within its territory. Those claims are mirrored by Taiwan.

    Spat over Chinese claims

    • China has backed its expansive claims with island-building and naval patrols.
    • The US says it does not take sides in territorial disputes but has sent military ships and planes near disputed islands, calling them “freedom of navigation” operations to ensure access to key shipping and air routes.
    • Both sides have accused each other of “militarizing” the South China Sea.
    • There are fears that the area is becoming a flashpoint, with potentially serious global consequences.

     

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  • India’s new West Asia approach is a welcome break with past diffidence

    Context

    The first summit this week of I2U2, which brings together India, Israel, the United Arab Emirates and the United States – is exploratory in nature.

    I2U2 forum

    • Following the Abraham Accords between Israel and the UAE, I2U2 was founded in October 2021 to address marine security, infrastructure, and transportation challenges in the region.
    • It was known as the ‘International Forum for Economic Cooperation’at the time. At that time, UAE had referred to the new grouping as the ‘West Asian Quad’.
    • I2U2 seeks to empower the partners and encourages them to collaborate more closely, resulting in a more stable region.
    • India is seen as a large consumer market as well as a large producer of high-tech and highly sought-after items in the United States.
    • This has led India to enhance its relationship with Israel without jeopardising its ties with the UAE and other Arab states.

    How I2U2 matters to India

    • India can contribute to peace and prosperity in the region: The initiative signifies the US bet that India can contribute significantly to peace and prosperity in the region.
    • West Asian engagement: It also underlines a new political will in Delhi to break the old taboos on India’s West Asian engagement.
    • Consolidation of  India’s Middle East Policy: The I2U2 marks the consolidation of a number of new trends in India’s Middle East policy that acquired greater momentum in the past few years.
    • What stands out sharply in India’s new thinking in the Middle East is that the summit involves three countries that Delhi had traditionally kept a safe political distance from.

    India-Israel relations

    • Although India was one of the first countries to extend recognition to Israel in 1950, Jawaharlal Nehru held back from establishing full diplomatic relations with the Jewish state.
    •  PV Narasimha Rao reversed that policy in 1992 but he did not travel to Israel nor did he receive an Israeli prime minister.
    • Atal Bihari Vajpayee of the BJP, which had a more empathetic view of Israel, hosted Israeli PM Ariel Sharon in 2003.
    • While the relationship steadily expanded, there was ideological reluctance in Delhi to give the partnership a political profile.
    • In the past few years India imparted a political character to the Israel ties.
    • No backlash from the Arab countries: There was little negative reaction to the more open pursuit of India’s ties with Israel.
    • The problem was never with the Middle East but Delhi’s ideological preconceptions that distorted India’s view of the region.
    • Turkey, now a champion of political Islam, had diplomatic ties with Israel since 1949.
    • Egypt normalised ties in 1980.
    • Under the Abrahamic accords promoted by the Trump Administration, the UAE, Bahrain, Sudan and Morocco set up formal ties with Israel in 2020.

    India’s relations with the Arab countries

    • India’s engagement with Israel was matched by effort to deepen India’s ties with the Arab world.
    •  During his first visit to Israel in 2018, Prime Minister Mode also became the first Indian PM to visit Palestine.
    • Even more important has been the transformation of India’s relations with the Gulf Kingdoms, especially the UAE and Saudi Arabia.
    • India’s traditional preference in the Arab world was for engaging the republics.
    • Engagement with monarchies: Delhi remained wary of engagement with the monarchies, telling itself that they were pro-Pakistan.
    •  No Indian PM visited Saudi Arabia between 1982 and 2010 and UAE between 1981 and 2015.
    • After 2015 India developed strong ties with these governments without a reference to Pakistan.
    • Despite Delhi’s ideological posturing, the Middle East had long ceased to be a political priority for India.
    • In contrast with the past, recently the prime minister has travelled four times to the UAE alone, negotiated a free trade agreement with it, and has ambitious plans for the transformation of bilateral relations.
    • The UAE has also backed India’s 2019 constitutional changes in Kashmir and is ready to invest in the union territory.

    Change in India’s approach to the region

    • India-US ties: For political Delhi, the US and Western policies in the region were a main part of the problem.
    • The immediate focus of Nehru’s policy after independence was to actively oppose US moves in the region in the name of promoting an “area of peace”.
    • That policy had no lasting impact as many regional countries sought active economic, political, and security cooperation with the US and the West.
    • The I2U2 then marks a big break from the anti-Western tradition in India’s approach to the region.
    • Negotiating the terms of joint engagement: In the past, standing up to the West in the Middle East was part of India’s approach, India now is prepared to confidently negotiate the terms of a joint engagement.

    Conclusion

    India’s participation in the West Asian Quad brings Delhi in line with other major powers– including Europe, China, and Russia – to try and engage all parties in the region. The I2U2 sets the stage for a new and dynamic phase in India’s relations with the Middle East.

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    Back2Basics: Abraham Accords

    • The Israel–UAE normalization agreement is officially called the Abraham Accords Peace Agreement.
    • It was initially agreed to in a joint statement by the United States, Israel and the United Arab Emirates (UAE) on August 13, 2020.
    • The UAE thus became the third Arab country, after Egypt in 1979 and Jordan in 1994, to agree to formally normalize its relationship with Israel as well as the first Persian Gulf country to do so.
    • Concurrently, Israel agreed to suspend plans for annexing parts of the West Bank.
    • The agreement normalized what had long been informal but robust foreign relations between the two countries.

  • Japan with India, for Indo-Pacific

    Context

    The article recounts the contribution of Japan’s former Prime Minister Shinzo Abe in strengthening India-Japan ties.

    Indo-Japan ties: Background

    • Japan-India ties are 70 years old this year.
    • For the first five post-war decades of the 20th century, bilateral ties were friendly.
    • India was not among the signatories of the 1951 San Francisco Peace Treaty, which brokered post-war relations between the defeated Axis power and the Allies.
    • Instead, Delhi established an independent peace treaty and bilateral relations with Japan.
    • Nehru’s decision to accept Japanese Overseas Development Aid, the first country to do so, also generated a lot of goodwill in the bilateral relationship. Several collaborations took place.
    • But it was only in the 21st century that bilateral ties climbed up to the next level.

    India-Japan ties during Shinzo Abe’s premiership

    • While Prime Ministers Yoshiro Mori had signed the Global Partnership for the 21st Century Agreement in 2000, to Abe goes much of the credit for the transformation of India-Japan ties in the last two decades.
    • This period witnessed the Japanese funding for ambitious projects such as the Mumbai-Delhi Industrial Corridor and the Mumbai-Ahmedabad bullet train.
    • The two countries upgraded the relationship to a Special Strategic and Global Partnership.
    • After a waiver to India from the Nuclear Suppliers Group following the India-US civil nuclear deal, Abe — and his Liberal Democratic Party successors — had begun to consider a similar deal with India, and a round of negotiations was held in that period.
    • The deal was eventually signed in 2016, and became operational a year later.
    •  It was during his tenure that the Japanese Maritime Self Defence Force (constitutionally, the Japanese military exists only for self-defence purposes) began naval exercises with friendly powers — India and Japan held their first naval exercise in December 2013 — and the country appointed its first National Security Advisor.

    Conclusion

    Abe believed that he was both destined and better equipped than many of his peers to play a transformational role in Japan’s politics and foreign affairs. He certainly achieved that with India. His passionate advocacy of closer ties with India will be missed.

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  • India-Japan ties under Shinzo Abe

    Shinzo Abe, the former Prime Minister of Japan, was shot dead.

    Japan under Abe

    • Abe, one of the most consequential leaders of Japan in its post-war history — was the country’s longest serving PM.
    • During his time in office, Abe was a great friend of India, and a relationship that he invested personally in.
    • He also had a special rapport with PM Modi, which came out on multiple occasions.

    Transformation in India-Japan ties

    (1) Personal visits

    • During his first stint in 2006-07, Abe visited India and addressed Parliament.
    • He visited India thrice: in January 2014, December 2015, and September 2017.
    • No other Prime Minister of Japan has made so many visits to India.
    • He was the first Japanese PM to be Chief Guest at the Republic Day parade in 2014.

    (2) Bilateral talks

    • The foundation for “Global Partnership between Japan and India” was laid in 2001, and annual bilateral summits were agreed in 2005, Abe accelerated the pace of ties since 2012.
    • In August 2007, when Abe visited India for the first time as PM, he delivered the now-famous “Confluence of the Two Seas” speech — laying the foundation for his concept of Indo-Pacific.
    • This concept has now become mainstream and one of the main pillars of India-Japan ties.

    (3) Nuclear deal

    • In September 2014, Modi and Abe agreed to upgrade the bilateral relationship to “Special Strategic and Global Partnership”.
    • The relationship grew and encompassed issues from civilian nuclear energy to maritime security, bullet trains to quality infrastructure, Act East policy to Indo-Pacific strategy.
    • When Modi went to Japan in 2014, the Indo-Japan nuclear deal was still uncertain, with Tokyo sensitive about a pact with a non-Nuclear-Proliferation-Treaty member country.
    • Abe convinced the anti-nuclear hawks in Japan to sign the agreement in 2016.

    (4) Defence cooperation

    • While the security agreement was in place since 2008, under Abe the two sides decided to have Foreign and Defence Ministers’ Meeting (2+2).
    • They started negotiations on the Acquisition and Cross-Servicing Agreement — a kind of military logistics support pact.
    • In November 2019, the first 2+2 was held in New Delhi.
    • A pact for transfer of defence equipment and technology was also signed in 2015, an uncommon agreement for post-War Japan.

    (5) Indo-Pacific narrative

    • During Abe’s tenure, India and Japan came closer in the Indo-Pacific architecture.
    • Abe had spelt out his vision of the Confluence of the Two Seas in his 2007 speech when the Quad was formed.
    • It collapsed soon, but in October 2017, as Chinese aggression grew in the Pacific, Indian Ocean, and India’s borders in Doklam, it was Abe’s Japan that really mooted the idea of reviving the Quad.

    (6) Development cooperation

    • During Abe’s visit in 2015, India decided to introduce the Shinkansen System (bullet train).
    • Under Abe’s leadership, India and Japan also formed the Act East Forum and are engaged in projects in the Northeast, closely watched by China.
    • The two countries also planned joint projects in Maldives and Sri Lanka among others to counter Beijing’s influence.

    (7) Stand against China

    • Since 2013, Indian and Chinese soldiers have had four publicly known border-stand-offs — April 2013, September 2014, June-August 2017, and the ongoing one since May 2020.
    • Abe’s Japan has stood with India through each of them.
    • During the Doklam crisis and the current stand-off, Japan has made statements against China for changing the status quo.

    Conclusion: A leader India always missed

    • Abe was a valuable G-7 leader for India, focused on strategic, economic and political deliverables, and not getting distracted by India’s domestic developments — much to New Delhi’s comfort.
    • Having hosted Modi at his ancestral home in Yamanashi, the first such reception extended to a foreign leader, Abe was feted at a roadshow in Ahmedabad.
    • Quite befittingly, the Indian government in January 2021 announced the Padma Vibhushan, the country’s second-highest civilian honour, for Abe.

     

     

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  • CAATSA: the US law to sanction transactions with Russia

    A US senator has said the US government must not impose sanctions on India under the Countering America’s Adversaries through Sanctions Act (CAATSA) for its purchase of S-400 missile weapons system from Russia.

    What is the CAATSA?

    • CAATSA is a law that came into effect in the US in 2017, meant to punish countries having deep engagements with Russia, North Korea, and Iran using economic sanctions.
    • It said countries having a “significant transaction” with Russian intelligence and military agents will be subject to at least five kinds of sanctions.
    • Ordinary transactions will not invite sanctions, and the decision of who has sanctions imposed on them comes down to the interpretation of “significant transaction”.
    • This is one of the various waivers or exemptions mentioned, such as the transaction not affecting US strategic interests, not endangering the alliances it is a part of, etc.

    Could it apply to India?

    • India has purchased the S-400 Triumf missile systems, which have advanced capabilities to judge the distance from a target and launch a surface-to-air missile attack.
    • Five such systems were bought by India in 2018 for US$ 5.5 billion and in November last year, their delivery began.
    • They were deployed in Punjab.
    • However, the application of CAATSA is not limited to the S-400, and may include other joint ventures for manufacturing or developing weapons in the future, or any other kinds of major deals with Russia.

    Why did the US enact a law like CAATSA?

    • The US flagged issues of Russia’s alleged interference in the 2016 Presidential elections, and its role in the Syrian war as some of the reasons for punishing engagement with it.
    • EU countries that had even more significant ties with Russia for oil and gas supply before the Ukraine-Russia conflict in 2022, had also criticised CAATSA.

    Countries facing sanctions

    • The US has placed sanctions on China and Turkey for purchase of the S-400.
    • The sanctions included denial of export licences, ban on foreign exchange transactions, blocking of all property and interests in property within the US jurisdiction and a visa ban.

    Likely impacts after India’s purchase

    • The Biden administration has no firm indication on where it leans on India’s case.
    • However, several senators (US parliamentarians) have called upon the Biden administration to consider a special waiver for India.
    • This is on account of India’s importance as a defence partner, and as a strategic partner on US concerns over China and in the Quad.
    • Other US leaders thinks that giving a waiver to India would be the wrong signal for others seeking to go ahead with similar deals.

    Why is the S-400 deal so important to India?

    • Security paradigm: S-400 is very important for India’s national security considerations due to the threats from China, Pakistan and now Afghanistan.
    • Air defence capability: The system will also offset the air defence capability gaps due to the IAF’s dwindling fighter squadron strength.
    • Russian legacy: Integrating the S-400 will be much easier as India has a large number of legacy Russian air defence systems.
    • Strategic autonomy: For both political as well as operational reasons, the deal is at a point of no return.

     

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