The Asia Pacific region, one of the most influential in world affairs, was in focus over the past week with several important summits—G20 in Brisbane, Australia, the East Asian Summit in Myanmar earlier and of the APEC in Beijing before that. The talks centred around geostrategic issues, ways to rev up the global economy, increase collective security and regional issues.
The G20 annual summit of the leaders of the most powerful nations that influence the interconnected world economy took steps towards some global economic and trade laws, especially those that have been blocking the World Trade Organisation (WTO). Since India and the US had reached a compromise on the Trade Facilitation Agreement which involves reducing India’s food stockpile but retaining food subsidies, the G20 leaders moved closer to a trade facilitation agreement in the WTO.
Of particular importance was the proposal of prime minister Narendra Modi to prevent cross-border tax evasion by hastening the Common Reporting Standard for automatic exchange of information on tax on reciprocal basis. This was accepted and became part of the joint communiqué. This has to be translated into an international economic law and will come into force by 2017.
Tax evasion is a political and economic question in India, and a huge problem internationally, since trillions of dollars are stashed in tax havens and in countries across the globe. These monies are linked to illegal trafficking including of drugs, terrorism, small arms and conflicts. The international community has paid more attention, for example, on banana trade rather than such transactions. These illegal cross-border transactions have to be collectively and legally tracked because if taxed, it could yield benefits to state governments for public utilisation. Modi also raised the issue of reducing remittance cost from the current high of 10 per cent to 5 per cent. These remittances are a lifeline for many poor people in India and in many developing countries, and cutting down remittance costs would benefit the G77 who are not part of such forums. The G20 proposals for global infrastructure and its methodology were part of the World Bank/IMF proposals.
The high-profile meeting of the 20 heads of state was also a public relations exercise for domestic audiences, with PM Modi’s address to NRIs and president Putin’s “couldn’t care less” attitude of early departure after the snubbing by Western leaders. Meanwhile, Chinese president Xi Jinping has an extended visit where he signs a free trade agreement with Australia. India has upped its relations with Australia, and signed a deal earlier for importing uranium.
The East Asian Summit (EAS) is part of the ASEAN (Association of Southeast Asian Nations) regional grouping of the Southeast Asian countries that have other major powers including the US, Russia, Australia, India and China as dialogue partners. This summit has grown in importance as many of the East Asian nations became fast-growing economies and because the ASEAN countries have a lot of collective weight when they speak in one voice. For example, when the Chinese became assertive over the disputed islands in the South China Sea, the ASEAN collectively voiced disagreement and the Chinese had to withdraw their militarist position. This was a lesson in collective regionalism as well as peaceful and firm diplomacy.
These meetings in the Asia Pacific region were thus an occasion for Modi to engage with world leaders. In Myanmar, he made the thrust for the Act East policy as a successor to the earlier Look East policy. This policy has the possibility of being a game-changer for the Northeast and eastern Indian states. But much depends on both internal and external drivers.
For this policy to be successful, the government will have to work with and through India’s east, rather than just the central government. In other words, when the GoI says it will develop infrastructure of roads and communications between India and Southeast Asia, these have to connect with the Northeastern states as also West Bengal.
This can only happen if there is peace, security and development in the region; if the state governments coordinate carefully with the Centre; if people and government are both stakeholders and trust each other; and borders are safe to be open. Without such components the Act East policy will remain rhetoric.
A major issue in the Asia Pacific is the unprecedented rise of China. US foreign policy expert John Mearshiemer believes that China’s rise cannot be peaceful. China contests this view and argues that their rise will be peaceful unlike that of the US. The questions that experts thus juggle are: Will the Chinese rise be peaceful? Will the US and China become a G2 and together dominate the region? Will China and Russia join to make a new bloc? and suchlike.
With questions such as these, strategic experts are proposing new blocs to counter the Chinese. One such proposal is a US-Japan-Australia-India quadrangle. Of course, in the current state of world affairs, such blocs are common. But the attempt is also to recreate the old bipolar world by getting new satellite states. In this, Asian countries are very important.
The other problem with such groupings, especially when linked with the US, is the danger of becoming militarily engaged. Any engagement at this level should not be directed at any third power. India has clearly argued that it is in favour of a multipolar world since that best suits India’s interests. If India has to advance economically and geostrategically it has to help construct this kind of multipolarity by engaging with multiple poles, including the Asia Pacific states.
In the coming days, India will be hosting Russian president Putin in Delhi. Russia is also a Asia Pacific power. Currently, it is being isolated by the West through economic sanctions. Many analysts are talking of a new Cold War. India should take all steps to ensure no such renewed militarism takes place. It can do so by engaging with all the countries and avoiding any military engagement.
The writer is professor at the School of International Studies, Jawaharlal Nehru University.
Email: chenoy@gmail.com