India, Europe and Asia: Convergence and Divergence 9813346078, 9789813346079

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India, Europe and Asia Convergence and Divergence Edited by Rajendra K. Jain

India, Europe and Asia

Rajendra K. Jain Editor

India, Europe and Asia Convergence and Divergence

Editor Rajendra K. Jain School of International Studies Jawaharlal Nehru University New Delhi, Delhi, India

ISBN 978-981-33-4607-9 ISBN 978-981-33-4608-6 (eBook) https://doi.org/10.1007/978-981-33-4608-6 © The Editor(s) (if applicable) and The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 This work is subject to copyright. All rights are solely and exclusively licensed by the Publisher, whether the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations, recitation, broadcasting, reproduction on microfilms or in any other physical way, and transmission or information storage and retrieval, electronic adaptation, computer software, or by similar or dissimilar methodology now known or hereafter developed. The use of general descriptive names, registered names, trademarks, service marks, etc. in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use. The publisher, the authors and the editors are safe to assume that the advice and information in this book are believed to be true and accurate at the date of publication. Neither the publisher nor the authors or the editors give a warranty, expressed or implied, with respect to the material contained herein or for any errors or omissions that may have been made. The publisher remains neutral with regard to jurisdictional claims in published maps and institutional affiliations. This Palgrave Macmillan imprint is published by the registered company Springer Nature Singapore Pte Ltd. The registered company address is: 152 Beach Road, #21-01/04 Gateway East, Singapore 189721, Singapore

To my wife, Sunita for her unfailing support

Introduction

Europe’s ‘re-discovery’ of Asia in the 1990s—the Strategy for Asia (1994) and the establishment of the Asia-Europe Meeting (ASEM) in 1996— reflected its desire to develop a more coherent and comprehensive policy towards Asia. Ever since the European Union’s 2001 Communication, ‘Europe and Asia: A Strategic Framework for Enhanced Partnerships’, the Union has sought to enhance its political and economic presence across the region. Containing twelve chapters by Indian and European experts and former Indian diplomats and policy-makers, this volume explores Indian economic, political and security engagement with Asia. It examines how India perceives the policies and role of the European Union and key EU Member States with Asia. The chapters explore the complexity, the elements of convergence and divergence as well as the challenges that India and Europe confront in dealing with key problem areas in South, Southeast, East and West Asia. The European Union’s engagement with Asia, Pramit Pal Chaudhuri argues in the first chapter, has been in the making for over four decades, but even today it continues to struggle to find traction, especially with China and India. Strategic and political calculations throughout Asia, he states, are largely made without factoring in Europe, let alone the European Union. In fact, Europe’s own shortcomings during 2010–2020 have led to a decline in its overall credibility and influence in Asia. This, he points out, has encouraged China ‘to become more assertive and India

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to become more sceptical about Europe’s ability to play a non-economic role in the region’. Apart from differing worldviews, relations between the two continents are bedevilled by the structural problems of geography and European notions of postmodernism. EU-India relations, Pramit asserts, have for decades been ‘consistent and insubstantial’. However, at a time when US-China friction fostered a traditional geopolitical struggle across Asia, the EU is starting to move towards a limited return to realpolitik in its external policy. The 2018 EU strategy towards India and new Indian Ocean strategies by key European states and other straws in the wind, he concludes, are indicative of a more security conscious EU position on Asia. The second chapter explores Indian and European interests and engagement with Asian multilateral organizations. It discusses how the Look East and Act East policies gradually promoted engagement with and membership of various Asian regional organizations. It examines Indian as well as European/EU interests and engagement in various Asian regional organizations, including the Association of Southeast Asian Nations, the East Asia Summit, ASEM, the ASEAN Regional Forum, and the South Asian Association of Regional Cooperation. However, the full impact of Indian policies towards Asian multilateral organizations, Anil Wadhwa argues, still needs to be realized on the ground. In conclusion, New Delhi, Wadhwa argues, is gaining ground over the European Union as a stabilizing country, as a provider of beneficial programmes, and as a strong partner for the Asian neighbours, even as the EU recedes in influence due to internal developments and the rise of China. There is, he concludes, immense scope for India and the European Union to work together with Asian regional institutions on common projects in keeping with their interests and policies. Both China and India are important partners for the European Union, but there is a qualitative difference in the attention and political energy devoted by the EU to China and India. In Chapter Three, Rajendra K. Jain discusses Indian perceptions of how the Europeans’ mirage of a socializing China has dissipated and highlights Indian business, civil and political elites’ views of China and EU-China relations. It looks into the coverage of the two Asian countries in the European media and the Indian commentariat’s views of increasing Chinese inroads in Central and Eastern Europe through the Belt and Road Initiative (BRI). The Western assumption that China would be one such alternate stakeholder in the existing international order has proven to be misplaced with Beijing’s emergence

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as its ‘most prominent normative challenger’ (Tharoor and Saran 2020: 192). In conclusion, the chapter examines Indian perceptions of Chinese efforts to establish a China-centric world order and the Indian commentariat’s reflections on EU-China relations in the wake of the COVID-19 pandemic and the India-China standoff at the Line of Actual Control (LAC). Indian observers concur that candid EU statements in Brussels’ March 2019 reflection paper of China being a partner, competitor and systemic rival should not lead one to make an inference that ‘the EU will follow the U.S. in “de-coupling” or join an “against-China” camp’ (Gokhale 2020). In an increasingly turbulent world, the European Union has sought to partner like-minded countries like India to maintain a rulesbased world order (see Jain 2020). The present disorderly world therefore presents an opportunity for India and the European Union to deepen and widen their conversations and cooperate to uphold the multilateral liberal order. After the 2008 global economic crisis, Javier Arregui argues in Chapter Four, trade and investment has become a key variable of the global policy economy and the new flagship of contemporary commercial policy as a stabilizing force in difficult times. This, he adds, signifies, among other things, that EU economies need to be consolidated through stronger trade and investment links with the new centres of global economic growth. The chapter seeks to analyse the role of FDI of the European Union in Asia and India. More specifically, it seeks to examine the extent to which the attraction of FDI in India (and other Asian economies) has depended on the stage of development of the host economy. It outlines the theory and the main drivers of the investment development path (IDP). It explains the role of the EU on FDI in global terms as well as the main arguments that explain the leading role played by the Union and the type of trade and investment relations the EU seeks to establish with third partners. The chapter goes on to examine the inherent logic and patterns of FDI investment in Asia. It critically assesses the main strengths and shortcomings of India in being able to increase both inward and outward FDI. It highlights the implications on trade and investment of the failure to conclude a Bilateral Trade and Investment Agreement for both India and the European Union. Chapter Five examines India’s decade-long quest for membership of ASEM, which represents an interesting case study of identity and exclusion of a major Asian country from a key interregional forum. It highlights how New Delhi’s purposeful and constructive Look East Policy

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since the early 1990s facilitated membership of ASEM in 2007. It goes on to discuss the perceptions of the Indian media and elites about ASEM and evaluates India’s decade-long engagement with ASEM. It concludes that ASEM continues to remain a forum for broad dialogue rather than problem-solving or practical cooperation. In an increasingly globalized and networked world, countries are increasingly competing to improve geographical connectivity and enhance political and economic cooperation. In Chapter Six, Manasi Singh analyses Indian and EU’s perspectives on geo-economics and the new Eurasian great game. China’s expanding continental and maritime footprint, she contends, has caused anxiety among the major powers of the world. The chapter highlights Indian criticism as well as European concerns about the BRI and the growing Chinese geopolitical influence in their neighbourhoods. The chapter evaluates India’s connectivity vision and strategy. It goes on to discuss Brussels’ 2018 ‘Strategy on Connecting Europe and Asia’ and examines the scope for cooperation in improving connectivity given Europe’s long and rich experience of connecting states and regions. The Indo-Pacific, B. Krishnamurthy argues in the next chapter, has emerged as a defining geopolitical, geoeconomic and geostrategic theatre of both cooperation and contention in the twenty-first century. He examines the politico-economic and strategic interests of India and the European Union in the Indo-Pacific and their strategies to deal with the challenge of growing Chinese unilateralism and assertiveness in the region. Both entities realize that only a successfully functioning multilateral and multipolar system as well as a ‘rules-based order’ can safeguard their interests. France and the United Kingdom are the only European nations with both the naval assets and the ability to play a strategic role in the IndoPacific. Of the two, he concludes, India shares similar visions and practical cooperation more with Paris than London. Chapter Eight examines the substantial Indian interests in geopolitically important West Asia. It discusses New Delhi’s expanding economic, political and strategic ties with Saudi Arabia, the United Arab Emirates and Qatar and the significance of its opening up to Israel in the 1990s. It discusses India’s equidistant policy in intra-regional conflicts and its focus on fostering economic, trade and investment ties as well as energy security. The chapter examines the Indian and European responses to the Arab Spring protests and the Saudi Arabia/Qatar rift. It evaluates the implications of the US decision to abrogate the Joint Comprehensive Plan of Action (JCPOA) with Iran for both India and Europe. It discusses how

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the problems of the region—terrorism, Palestine, rising tide of migration, hotspots like Syria, Libya or the Iranian question—are increasingly becoming a European challenge and directly affecting Europe. At first glance, India, Patryk Kugiel argues, does not apparently seem to be a natural partner of the European Union when it comes to Iran. However, Indian and EU perspectives towards Iran, he maintains, largely converge, especially regarding non-proliferation, the perseverance of the 2016 JCPOA as well as in the integration of Iran in the global economy and the international community. He makes a comparison of India-EU perceptions and policies in three key areas, namely nuclear programme, energy and trade as well as strategic interests, and highlights the areas of convergence and divergence. After an evaluation of India’s policy towards Iran over the past two decades, Patryk Kugiel optimistically concludes that India is well placed ‘to offer good services and mitigate tensions between main adversaries while contributing to stability in the Middle East’. There is, he feels, potential for both Europe and India to collaborate with Iran regarding connectivity, the stabilization of Afghanistan and the fight against international terrorism. In Chapter Ten, Pramit Pal Chaudhuri regards the differences between India and the European Union over Kashmir as ‘a textbook example’ of how these two governments approach a major foreign policy dispute in wholly different ways. The two original points of difference, he argues, were India’s on-and-off policy towards dialogue with Pakistan and the broader issue of human rights violations in Indian-held Kashmir. These differences reached their peak between 2000 and 2004, leading to major dissonance between the New Delhi and the European Commission. Until 2007, Kashmir had remained an irritant after that primarily because of activists in the European Parliament. Subsequently, Kashmir largely disappeared from the formal bilateral relationship. Since 2008, the EU and India seem to have developed a formula comprising four elements for handling the Kashmir issue, viz. human rights violations taken up in the annual human rights dialogue, regular visits of EU ambassadors and officials to carry out fact-finding missions to Kashmir, regular EU humanitarian and development assistance to Kashmir, and rhetorical support for reconciliation between India and Pakistan. This formula has kept bilateral ties from being adversely affected. Today, he concludes, New Delhi essentially perceives Kashmir as a non-issue when it comes to its relations with Brussels.

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In Chapter Eleven, Vivek Katju approaches Indian and European interaction on and via Afghanistan in five phases: (a) Afghanistan as transit point for Alexander’s invasion of India in 326 BCE and the nature of its impact; (b) Afghanistan as buffer; (c) Afghanistan as a Cold War arena; (d) Afghanistan as terrorism centre pre-9/11; and (e) Afghanistan as post-conflict laboratory. From the time that the United States launched its operations in October 2001 to the present, West European nations, Katju asserts, have not had a discernible independent approach towards Afghanistan. Initially, they largely performed roles assigned to them by Washington. The chapter discusses Indian and West European divergent approaches towards negotiations with the Taliban. For many years, he argues, India maintained that the Taliban were not an entity that were worthy of a role in the new Afghanistan. As Europe and the United States began to open up to the Taliban, he adds. India seemed to have softened its statements or muted them altogether. New Delhi looked upon all this as an intra-Afghan process. Europe openly encouraged it. Herein, Katju points out, lay the crucial difference between India and Europe on the issue of reconciliation and peace-making in Afghanistan. The chapter goes on to make a perceptive analysis of different Indian and European perceptions of Pakistan’s role in Afghanistan. In conclusion, the author urges India and Europe to hold an honest and intensive dialogue on the role of Pakistan in Afghanistan. In the concluding chapter, Rajiv Bhatia addresses developments in Myanmar and argues that Indian and European/EU policies have been influenced by their geographical situations, historical circumstances, value systems and national interests. Barring a short period (1988–1991), the two sides found themselves on different sides of the diplomatic fence, with the EU pursuing a sanctions-anchored strategy and India emerging as a pragmatic advocate of ‘constructive engagement’. Progress towards political democratization, brought by the military in 2011, created a new opening. Europe seized it to improve relations with Myanmar and adopt a broader agenda transcending democracy and human rights. The European Union, he feels, has been a highly articulate and visible actor, although not as influential as others like China, the United States, ASEAN and India. Individual European countries, especially France, Germany and the United Kingdom, he maintains, have pursued their strategic, economic and other interests in Myanmar without being constrained by the so-called binary divide between Europe and India regarding values and interests. In

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conclusion, Bhatia focuses on four key issues regarding Myanmar today— nation-building, the gap between the government and ethnic groups, the perennial problem of devising a way to end the military’s political role and making Myanmar a full democracy, and China’s growing strategic footprint. Although the Rohingya crisis in mid-2017 again exposed the basic divergences in the European and Indian attitudes, there is, he concludes, much that they share in enabling Myanmar which continues to deal with the incredibly complex challenges of nation-building and ethnic reconciliation. Today, Asia is a crucial partner in many key areas for both India and Europe/European Union. In recent years, the relationship between the European Union and Asia has witnessed greater engagement as a result of the decline of the United States, transatlantic tensions under the Trump administration, Brexit, the rise of a more assertive China and the growing importance of Asian powers. A more unified European policy towards Asia continues to be elusive. Though Europe is more conscious of the security challenges in Asia, it prefers to leave most of the hard strategy and security contribution to the United States.

References Gokhale, V. (2020, 13 July). The Sum and Substance of the EU’s China Dilemma. The Hindu. Retrieved July 16, 2020, from https://www.thehindu. com/opinion/lead/the-sum-and-substance-of-the-eus-china-dilemma/articl e32060289.ece. Jain, Rajendra K. (2020). India and the European Union in a Turbulent World. Singapore: Palgrave Macmillan. Tharoor, S., & Saran, S. (2020). The New World Disorder and the Indian Imperative. New Delhi: Aleph Book Company.

Contents

1

1

India, Europe and the Rise of Asia Pramit Pal Chaudhuri

2

India, Europe and Asian Regional Organizations Anil Wadhwa

3

India and EU-China Relations: Perceptions and Misperceptions Rajendra K. Jain

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European Union Foreign Investment Policy in Asia and India Javier Arregui

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4

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6

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India and ASEM: From Membership to Active Engagement Rajendra K. Jain

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India, Europe and Connectivity: From Shared Views on BRI to Mutual Cooperation? Manasi Singh

133

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India, Europe and the Indo-Pacific B. Krishnamurthy

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India, Europe/the European Union and West Asia Anil Wadhwa

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CONTENTS

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India, the European Union and Iran Patryk Kugiel

10

India, the European Union and Kashmir: Containing a Postmodern Policy Pramit Pal Chaudhuri

11

India, Europe and Afghanistan Vivek Katju

12

India, Europe and Myanmar: Policy Approaches and Impact Rajiv Bhatia

Index

211

237 261

279

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Notes on Contributors

Javier Arregui is Associate Professor at the Department of Political and Social Sciences and Jean Monnet Chair in European Governance at Pompeu Fabra University (Barcelona, Spain). He is also the Director of the Barcelona Center for European Studies (BACES) from the same university. He received his PhD in Political Science from the University of Groningen (The Netherlands). Among other appointments, he has been a Research Fellow at the Interuniversity Center for Social Science, Theory and Methodology (University of Groningen, 1999–2004) and researcher at Centro de Investigaciones Sociológicas (CIS) (Madrid, 1998–1999). He is also Senior Researcher at the Johns Hopkins University/UPF Public Policy Center. His research in recent years has focused on European governance issues such as the different stages and explanatory mechanisms of the European Union’s political process or the democratic deficit of the Union and how this conditions the presence of winners and losers in the EU. He has published over 33 journal articles and book chapters. Furthermore, an important career milestone has been the continuous elaboration of the most extensive database on the EU’s political process (the DEU dataset), whose future publications include a forthcoming special issue on its most updated version (DEUIII) in the Journal of European Public Policy. Rajiv Bhatia is Distinguished Fellow in Gateway House, a prestigious and dynamic think tank based in Mumbai. He is a former High Commissioner to South Africa, Lesotho and Kenya, and a former Ambassador xvii

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NOTES ON CONTRIBUTORS

to Myanmar and Mexico. He has also been Director-General of the Indian Council of World Affairs (ICWA) from 2012 to 2015. He was formerly Senior Visiting Research Fellow in the Institute of Southeast Asian Studies, Singapore (2011–2013). He has been an active member of the Africa Committee of the Confederation of Indian Industry (CII). He also chaired two national-level expert groups set up by the Federation of Indian Commerce and Industry (FICCI), which produced special studies on Blue Economy in 2017 and rejuvenation of BIMSTEC in 2018. Besides, he is a core member of the Kalinga International Foundation, mandated to strengthen India’s linkages with the Indo-Pacific. He also sits on the Governing Council of Asian Confluence, a think tank based in Shillong. He is the author of India-Myanmar Relations: Changing Contours (Routledge 2016). Rajendra K. Jain was formerly Professor and Chairperson at the Centre for European Studies, Jawaharlal Nehru University, New Delhi. He has been Director, Europe Area Studies Programme, JNU, and the first Jean Monnet Chair in India (2010–2015). He has also been Adjunct Research Professor, Monash European and EU Studies Centre, Monash University, Melbourne (2010–2015). He was formerly Visiting Professor, Asia-Europe Institute, University of Malaya (2010), and Visiting International Fellow, Monash Europe and EU Centre, Melbourne (2009). He was Alexander von Humboldt Foundation Fellow at the University of Constance (1992-1993, 1994) and Visiting Fellow at the School of Slavonic and East European Studies, University of London (1993) and the Foundation for Science and Politics (1995), Ebenhausen, Germany. He has been Visiting Humboldt Foundation Professor at Freiburg, Leipzig and Tuebingen universities and at the Maison des Sciences de l’Homme, Paris (2005, 2006, 2008, 2010, 2013). He has also been Visiting Professor at the universities of Sofia, Warsaw and UPFM Barcelona. He was Indian Council of Cultural Relations (ICCR) Professor of Contemporary India, Leuven University (2015). He is the author/editor of over 30 books and has written over 150 articles/book chapters. He has travelled extensively in Asia, Europe and North America and has lived in the United States (5 years) and Germany (3 years). He has most recently edited Changing Indian Images of the European Union: Perception and Misperception (Palgrave 2019), India and the European Union in a Turbulent World (Palgrave 2020) and India and Central Europe: Perceptions, Perspectives, Prospects (Palgrave 2021).

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Vivek Katju joined the Indian Foreign Service in 1975 and retired as Secretary (West) in the Ministry of External Affairs in August 2011. During his diplomatic career, he served in Indian Missions in Cairo, Abu Dhabi, Washington DC, Suva and Kuala Lumpur. At headquarters, among other assignments he served as Joint Secretary (Iran, Pakistan and Afghanistan) (1995–2001), Additional Secretary and Special Secretary (International Organizations and Political) (2008–2009). He also served as Ambassador to Myanmar, Afghanistan and Thailand. B. Krishnamurthy is former Professor and Head of the Department of Politics and International Studies and Director, Centre for European Studies, Pondicherry University, Puducherry, India. He has been Visiting Scholar at the Paris 13 University, University of Warsaw and Aarhus University. He has published Indo-French Relations: Prospects and Perspectives (New Delhi: Shipra, 2005); Changing World Order: India, EU, and US (New Delhi: Shipra, 2009); and European Convention on Human Rights: Sixty Years and Beyond (New Delhi: New Century Publications, 2012). Patryk Kugiel is the Head of the International Economic Relations and Global Issues Programme at the Polish Institute of International Affairs (PISM), Warsaw. He is a specialist on South Asia and international development cooperation. His research in PISM focuses on the foreign policy of India and Pakistan, the security situation in South Asia, US and EU policies towards the region, implications of India’s rise on the global order as well as the development cooperation policy of Poland and the EU. He is the co-editor of India-Poland Relations in the 21st Century: Vistas for Future Cooperation (Vij Books, 2014) and India’s Soft Power: A New Foreign Policy Strategy (Routledge, 2017). Pramit Pal Chaudhuri is a Distinguished Fellow and Head, Strategic Affairs at Ananta Aspen Centre and the Foreign Editor of the Hindustan Times. He writes on political, security and economic issues. He was a member of National Security Advisory Board of the Government of India (2011–2015) and is a member of the Asia Society Global Council and the Aspen Institute Italia, the International Institute of Strategic Studies, and the Mont Pelerin Society. Manasi Singh is Assistant Professor at Centre for Security Studies, School of National Security Studies, Central University of Gujarat, India. She holds a Ph.D. in European Studies from JNU. She was a Visiting

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Researcher at the Université Libre de Bruxelles (ULB), the Freie University Berlin and the University of Bonn. She previously taught international relations at the University of Delhi and has work experience in print journalism. She was briefly associated with the UN Millennium Campaign and spent two years working in the non-profit sector. Her research interests include the EU’s politics and external relations, global governance and multilateralism, regional security in South Asia, and India’s foreign policy. Anil Wadhwa has been a member of the Indian Foreign Service for 38 years (1979–2017). In his previous diplomatic assignments, he served, among others, in Hong Kong, Beijing and Geneva. He was formerly Joint Secretary, Central and Eastern Europe, Ministry of External Affairs, New Delhi (2001–2004), and Ambassador to Poland and Lithuania (2004– 2007), Oman (2007–2011), Thailand (2011–2014) and to Italy and San Marino (2016–2017). As Secretary (East) in the Ministry of External Affairs (2014–2016), he oversaw relations with ASEAN, Southeast Asia, Australasia and the Pacific, the Gulf Cooperation Council, the Middle East and West Asia. He was also the leader of the Senior Officials to all meetings of ASEAN, ASEM, ACD, Arab League, Mekong-Ganga Cooperation, ARF and the East Asia Summit. Ambassador Wadhwa has contributed to a number of articles on foreign policy, disarmament and international security. He has been a Senior Fellow (January–October 2018) and since then, a Distinguished Fellow with the Vivekananda International Foundation, New Delhi. He has most recently published India’s Foreign Policy: Surviving in a Turbulent World (co-editor) (Sage 2020).

Abbreviations

A2/AD AAGC ADB ADMM ADMM-Plus AEP AIIB APEC ARF ARIA ASEAN ASEM BBIN BCIM BIMSTEC BITs BJP BRI BRICs BTIA BUILD CAREC CENTCOM CICA CMLV COC

Anti-Access/Area Denial Asia-Africa Growth Corridor Asian Development Bank ASEAN Defence Ministers Meeting ASEAN Defence Ministers’ Meeting Plus Act East Policy Asian Infrastructure Investment Bank Asia-Pacific Economic Cooperation ASEAN Regional Forum Asia Reassurance Initiative Act Association of South East Asian Nations Asia–Europe Meeting Bangladesh, Bhutan, India and Nepal Bangladesh China India Myanmar Bay of Bengal Initiative for Multisectoral Cooperation Bilateral Investment Treaties Bharatiya Janata Party Belt and Road Initiative Brazil, Russia, India, China and South Africa Broad-based Trade and Investment Agreement Better Utilization of Investment Leading to Development Act Central Asia Regional Economic Cooperation United States Central Command Conference on Interaction and Confidence-Building in Asia Cambodia, Myanmar, Laos and Vietnam Code of Conduct xxi

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ABBREVIATIONS

COMRA CPEC DG DOC EAS EEAS EEAU EEC EEZ EFCD EIDHR EMF EPQI EU EU/E3 EU/E4 FATF FDI FIPIC FMM FONOPS FTA GCC GDP GMS GSP GVC HADR IAEA ICT IDP IMT INSTC INSTEX IONS IORA IPR ISA JCPOA LEAP LEP LIFT

China Ocean Mineral Resources R&D Association China Pakistan Economic Corridor Directorate-General Declaration of the Conduct of the Parties in South China Sea East Asia Summit European External Action Service Eurasian Economic Union European Economic Community Exclusive Economic Zone European Fund for Sustainable Development European Instrument for Democracy and Human Rights Expanded ASEAN Maritime Forum Expanded Partnerships for Quality Infra European Union EU and three EU Member States (France, Germany, and Italy) EU and four EU Member States (France, Germany, Italy, and the United Kingdom) Financial Action Task Force Foreign Direct Investment Forum for India-Pacific Islands Cooperation Foreign Ministers Meeting Freedom of Navigation Operations Free Trade Agreement Gulf Cooperation Council Gross Domestic Product Greater Mekong Subregion Generalised Scheme of Preferences Global Value Chains Humanitarian assistance and disaster relief International Atomic Energy Agency information and communications technologies Investment Development Path India–Myanmar–Thailand International North-South Transport Corridor Instrument in Support of Trade Exchanges Indian Ocean Naval Symposium Indian Ocean Rim Association Intellectual Property Rights International Solar Alliance Joint Comprehensive Plan of Action Leading Asia’s Private Sector Infrastructure Fund Look East Policy Livelihoods and Food Security Trust Fund

ABBREVIATIONS

LNG MEA MGC MIEC NAM NATO NDA NESA NIIF NLD NPT NTBs NWFP OECD OIC OPCW PIF PTA RCEP ReCAAP RTAs SAARC SAGAR SAGQ SASEC SCO SLOC SLORC SMEs SOM SPDC TEIN TEN-T TPP TTIP UAE UN UNCLOS UNCTAD UNESCAP UNSMIL

xxiii

Liquified Natural Gas Ministry of External Affairs Mekong Ganga Cooperation Mekong-India Economic Corridor Non-Aligned Movement North Atlantic Treaty Organization National Democratic Alliance Northeast and South Asia National Investment and Infrastructure Fund National League for Democracy Non-Proliferation Treaty Non-Tariff Barriers North West Frontier Province Organisation for Economic Cooperation and Development Organization of Islamic Countries Organization for the Prohibition of Chemical Weapons Pacific Islands Forum Preferential Trade Agreement Regional Comprehensive Cooperation Partnership Regional Cooperation Agreement on Combating Piracy and Armed Robbery against Ships in Asia Regional Trade Agreements South Asian Association for Regional Cooperation Security and Growth for All in the Region South Asia Growth Triangle South Asian Sub-Regional Economic Cooperation Shanghai Cooperation Organization Sea Lines of Communications State Law and Order Restoration Council Small and Medium Enterprises Senior Officials Meeting State Peace and Development Council Trans-Eurasian Information Network Trans-European Transport Network Trans-Pacific Partnership Transatlantic Trade and Investment Partnership United Arab Emirates United Nations United Nations Convention on the Law of the Sea United Nations Conference on Trade and Development United Nations Economic and Social Commission for Asia and the Pacific United Nations Support Mission in Libya

xxiv UPA US USDP WPNS WTO

ABBREVIATIONS

United Progressive Alliance United States Union Solidarity and Development Party Western Pacific Naval Symposium World Trade Organization

List of Figures

Graph 4.1 Graph 4.2 Graph 4.3 Graph 4.4 Graph 4.5 Graph 4.6 Graph 9.1 Graph 9.2

Relationship between Theory of IDP and the Key Drivers of Investment Policies Economic Growth (in GDP) in Select Asian Countries, 2003–2016 FDI in India, 2003–2016 Factors Explaining India’s Competitiveness over Time Scheme of the Distribution of Competitiveness in India, 2016 Interannual Variation of Exports EU-India-World, 2002–2015 European Union Trade with Iran, 2008–2018 India’s Trade with Iran, 2008–2018

80 85 90 92 93 94 223 224

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List of Tables

Table 4.1 Table 4.2 Table 4.3 Table 4.4

FDI Flows by Country, 2013–2016 Foreign Direct Investment in Select Asian Countries, 2003–2016 Variation of the Value of Exports among India-the EU–World Variation of the Value of FDI Flows between the EU and India

83 87 93 93

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CHAPTER 1

India, Europe and the Rise of Asia Pramit Pal Chaudhuri

The European Union’s engagement with Asia has been over 40 years in the making. However, besides the obvious trade and investment issues, Europe continues to struggle to find traction in the largest continent, especially with its two largest countries China and India. Throughout Asia, strategic and political calculations are largely made without factoring in Europe, let alone the European Union. Europe’s own shortcomings in the decade 2010–2020, including chronic financial problems, domestic battles over immigration and Britain’s departure from the EU, have meant the continent’s overall credibility and influence have declined in Asia. This has encouraged China to become more assertive and India to become more sceptical. The EU’s most ambitious Asian policy was a roughly decade-long attempt to make China a responsible global stakeholder, a policy that was accepted to have failed by the mid-2000s. In the past several years, the policy has gone into reverse with attempts by the EU and its larger

P. Pal Chaudhuri (B) Head, Strategic Affairs at Ananta Aspen Centre, New Delhi, India Foreign Editor, Hindustan Times, New Delhi, India © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 R. K. Jain (ed.), India, Europe and Asia, https://doi.org/10.1007/978-981-33-4608-6_1

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P. PAL CHAUDHURI

Member States to respond strongly to predatory Chinese economic policies and attempts to politically undermine European unity. One element of this pushback, helped along by European concerns at the US indifference to the Atlantic alliance under the Donald Trump Administration, has been a more determined outreach by the EU to India. This remains a road under construction. New Delhi is sceptical of Europe’s ability to play a non-economic role in the region that has come to be known as the Indo-Pacific. Europeans express discomfort with the right-wing identity politics of the Narendra Modi government. Nonetheless, the two sides now talk of strategic cooperation rather than the just trade and values.

Worlds Apart While there are obvious structural issues that bedevil Europe’s relations with Asia, there are more fundamental problems in terms of differing worldviews. The first structural problem is geography. Europe and Asia are connected by land, but largely through a huge sparsely populated expanse of Central and West Asia, but not by sea. And that has been a negative in finding potential areas of cooperation like security. The second is the decision-making structure of the EU and the difficulty in creating a single European position on strategic issues. Officials from key Asian governments who have had to deal with Europe all recount being asked by the larger European Member States to support the latter’s national policies— and help them undermine the policy being pushed by Brussels.1 But the core problem of the Europe and Asia relationship, especially the larger Asian countries like India and China, goes much deeper. The nations of Europe have ordered their polity in a way that the British scholar-diplomat Robert Cooper, among others, has labelled ‘postmodern’. Accompanying this is a distinct worldview, including a unique view of how security is best accomplished and the role of sovereignty in the international system (Cooper 2003). It is a worldview that could not be more different from the modernist stance, imbued with strong nationalist overtones, but it holds sway among most large Asian nations. If anything, the modernist worldview, similar to the post-Westphalian system

1 Private conversations with European and Asian diplomats over the past 15 years.

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accepted by the Western world until the end of the Cold War, is becoming more evident in the actions of larger Asian countries as they urbanize and experience middle-class expansion. The post-Westphalian state structure that arose in Europe—and later spread to most of the world—was designed to prevent the recurrence of the bloodshed and chaos of the Thirty Years’ War. It had three key consequences. One, it made the building block of the international system, the nation-state. The domestic affairs of such states should be treated as sovereign, immune to the external interference of others. Without this rule, conflict over universal concepts like religion and ideology, wars that could rage on forever, would be legitimized. Two, as a consequence, the favoured system of tackling the ever-changing power structure of nationstates became the balance of power and an implicit threat of violence. Keeping an iron fist inside the glove of diplomacy ensured wars broke out on a regular basis, but wars that sought ultimately to restore the nationstate system. Three, a Sovereignty First standard and the balance of power meant that states were given a free ride on moral and ethical issues. A government was different from an individual because it had things like the balance of power to maintain. It could do dirty and covert things that would put an individual behind bars (Cooper 2003: 7–12). This became globally accepted as the way the world should be run, until the experience of the two world wars. This trauma led Europeans to conclude that the post-Westphalian system had reached its shelf life. The Cold War, in many ways the same balance of power writ large, only put this on hold. The political philosophy that lay behind the creation of the EU had a radically different concept of how relations between nations should be ordered. It overturned all three of the pillars of the Westphalian system mentioned previously. First, it argued that while the nation-state would remain an important method of political organization, it would not be seen as the brick and mortar of the regional order. Governments would not receive special sovereignty-based favours, the right to wage war and a waiver on acts of questionable morality. A national government, at the very least, would be held to the same standards as a provincial or municipal body. This was explicit from the start. In one of the drafts of the Schuman Plan, Jean Monnet wrote, ‘This proposal has an essential political objective: to make a breach in the ramparts of national sovereignty’ (Monnet 1978: 7). Second, as a consequence, the favoured way to handle relations between national governments was transparency and mutually agreed

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interference. The European states would poke inside each other’s affairs. They would open their military systems to inspection, combination and eventual union. As it has been said, ‘Mutual interference is normal for postmodern states’ (Cooper 2003: 30). It also meant that ‘Of the big powers, only the European Union can be relied on to champion multilateralism’ (Grant 2008). Through the 1980s and 1990s, the pace of European unity was breathtaking. The Cold War’s end allowed Europe to dismantle one of the world’s most entrenched defence systems. The consolidation of standards, judicial systems, creation of a single continental parliament and, finally, the fusion of 17 independent monetary policies were done on a timeline unsurpassed in history. These all continue to suffer from teething problems, but they are here to stay including the euro currency. Europeans have rightly taken pride in this. They can even claim—as no other region can barring North America—that war and violent conflict in their region has been relegated to the dustbin of history. However, in the early 1990s, the violent break-up of Yugoslavia and the odd bit of friction with the more traditional, modern nation-states on their borders like Russia and Turkey led Europeans to conclude they could not rest on their laurels. To preserve the success of the European model, the model had to spread beyond its borders. There were reasons for Europe to believe this was do-able. It had successfully democratized the military-fascist rules of southern Europe. It had absorbed and transformed the communist states of Central Europe. The most ambitious project in all of this was a belief the European example could influence the evolution of the Middle Kingdom.

China Fantasy The highpoint of pan-European optimism, in regard to its influence on the wider world, was the belief that developed in the period running from 1994 to 2008 that the European Union could serve, and would be accepted, as a model for an emerging China. This European policy arose because the EU concluded in 1995 that it needed ‘a long-term strategy that reflects China’s worldwide, as well as regional, economic and political influence’. Brussels, observing Beijing’s rapid economic rise, sensibly felt Europe’s future competitiveness needed stronger economic ties and the credibility of the EU’s own foreign policy required a ‘coherent China strategy’ (Grant and Barysch 2005: 7). Its

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first China strategy in 1995 ambitiously said that Brussels’ first objective was to ‘socialize China into the kind of international order that the EU supports’. This included nuclear nonproliferation, support for the United Nations, global environmental issues and so on. Its second objective was to help China’s internal transition in areas like reducing regional disparities, green policies and civil society support. EU officials spoke of how China and the EU ‘face similar problems and favour similar approaches to solving them’. One Eurocrat, speaking about Brussels assistance to China’s domestic problems, said, ‘Officially, we call it ‘exchange of experience,’ but in reality ‘we are exporting our model to China’ (Grant and Barysch 2005: 52). The Europeans believed enmeshing China into a network of international obligations and exposing it to the European way of doing things would make China easier to ‘manage’ and make it less likely to be a revisionist power (Shambaugh 2004: 248). ‘We need China to want what we want,’ said one EU diplomat (Fox and Godement 2009: 1). There was much scepticism by the US and definitely among most of China’s Asian neighbours of the entire European view that China was a ‘status quo power that will be primarily preoccupied with its own internal challenges for the foreseeable future—a bit like the EU itself’ (Grant and Barysch 2005: 67). Beijing seems to have concluded it would have to put up with the EU’s lectures on values because of economic reasons. It also seemed to have decided it would be able to deflect pressure on civil rights by winning over European business lobbies. Premier Li Peng in 1996 said, ‘If the Europeans worked with China in all areas, not all economically but also politically and in other areas, I think they would get more contracts with China.’ From the word go, Beijing stoutly resisted any agreement on ‘common values,’ migration policy and intellectual property rights. China’s 2003 policy paper on EU made it clear human rights discussions should be kept to ‘social and economic rights.’ Political anything was off the agenda. By then, Human Rights Watch, among others, was denouncing the EU-China human rights dialogue as an ‘empty gesture’ (Human Rights Watch 2013). By 2007, even the economic relationship began souring as the European Union racked up massive trade deficits with China that it blamed, like the US, on Beijing’s careful tilting of the business landscape against foreign players. European firms, especially in the luxury goods and engineering sector, complained of their products being pirated and technology

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being stolen by Chinese competitors—and Beijing’s lack of redress on these issues. Human rights issues involving China in 2009–2010 affected the European Street. China’s support for the Sudanese government over the Darfur massacres led to public protests as did the violent repression of Tibetan riots, heavy-handed Chinese attempts to control the Olympic torch relay and clampdowns on protests by Muslim minority members in Xinjiang. By the late 2000s, it was clear the values part of the European strategy of engagement-in-depth with China was coming apart. Europeans, who had once placed the US as the biggest threat to global security following the invasions of Iraq and Afghanistan, put China back on top of the list (Der Spiegel 2008). A 2009 US-European discussion about the state of Europe’s dialogue with China on human rights was suitably dismal with Beijing using every possible device to block any discussion on political rights and rule of law (Wikileaks 2009b). An exhaustive 2009 analysis of the EU’s relationship with China by the European Council of Foreign Affairs was particularly hard-hitting. ‘The EU’s China strategy is based on an anachronistic belief that China, under the influence of European engagement, will liberalize its economy, improve the rule of law and democratize its politics.’ Instead, it said, ‘China’s foreign and domestic policy has evolved in a way that has paid little heed to European values, and today Beijing regularly contravenes or even undermines them.’ Far from being a catalyst for change in China, the report said, the EU’s policy had become one of ‘unconditional engagement’ where Europe unilaterally gave China access to its markets and provided it investments and received nothing in return. The Chinese, said the report, showed remarkable skill in playing the various European countries against each other and undermining any possibility of a continental approach to Beijing. China treats the ‘relationship with the EU as a game of chess, with 27 opponents crowding the other side of the board and squabbling about which piece to move.’ The European states ended up having no real political engagement strategy. More surprising, they could not even come together on a common economic approach to China— even as the EU’s trade deficit with China reached e170 billion (Fox and Godement 2009: 2). Hardline Chinese scholar Pan Wei wrote in 2008, ‘the EU is weak, politically divided and military non-influential. Economically, it’s a giant, but we no longer fear it because we know that the EU needs China more than China needs the EU.’ While a personal view, Pan’s comments

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saw reflection in Beijing’s official actions. Angered over European human rights condemnations and concluding the EU would not defy the US over its arms embargo, ‘China downgraded its political expectations of Europe at the very moment when it upgraded its relationship with the United States’ (Godement and Parello-Plesner 2011: 2). The European sovereign debt crisis only accentuated a Chinese sense that the EU, far from representing a superior political and economic system, was at best an equal to the Chinese model. As Fu Ying, China’s Vice-Minister of Foreign Affairs, told a German journalist who quizzed her about Western concerns regarding China’s intentions, ‘Get down off your high horse of being on top of the world. Come down to be equals and join us on a level playing field’ (Der Spiegel 2011, 22 August). This was further accentuated in coming years by Europe’s confused response to the Syrian refugee crisis, the Brexit vote and subsequent withdrawal of Britain from the EU, a weak European response to Russia’s annexation of the Crimea and an overall sense of European economic weakness (Von Hein and Fu Yue 2015). The EU, after having spent so much time talking to China about how they could cooperate in building a multipolar world that would contain US dominance, began changing its tune at least in private. When the US Ambassador to the EU, William Kennard, presented his credentials to the President of the European Commission, Jose Manuel Barroso, in 2010, the latter talked of the ‘potential power of the US-EU partnership to challenge China’s role in the developing world, in particular through regulatory convergence’ (Wikileaks 2010, 14 January). While its official response was largely passive, Brussels internally began shifting from a values-driven China polity to one where strategic concerns were to play a larger role. In its own way, the fact neither theme received a mention in the European External Action Service’s strategic agenda paper for China in 2016, mapping out priorities over the next five years, and the text was all about economic, technology and trade issues, was a sign of this transition (European External Action Service 2020). The European response to China’s Belt and Road Initiative (BRI), a trillion-dollar global infrastructure programme touted by Beijing as a global public good, went through a similar maturing process. When it was first announced in 2013, it was cautiously embraced by European governments and business, both for the economic benefits and for the sense Beijing was seeking to provide global public goods but largely because Europe could not put together a common position. ‘There was a general

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belief among observers in the EU that BRI would undermine European interests, such as rules based public tenders, reciprocal market access, and European environmental and social standards. While BRI continued to be debated among European policymakers, institutions, fora, academic and media, lacking ‘a clear response from Brussels, Europe had already started its engagement with BRI in many different ways,’ noted one European commentator (Skala-Kuhmann 2019). By the time of the first BRI Forum in 2017, business remained enthusiastic but Brussels and other European capitals were becoming increasingly wary. Three years later, even the European Chamber of Commerce in China was moved to issue a scathing report on how the Chinese used opaque bidding processes to ensure their firms bagged most BRI contracts and left only ‘crumbs’ for European business firms (Crossley 2020). The final blow as far as Brussels was concerned seems to have been China’s making major inroads, economically and politically, within the EU, especially in Central and Eastern Europe and the Eastern Mediterranean. Countries from these two regions were over-represented at the BRI Forums and enthusiastic official endorsers of the Chinese project. Beijing began holding a separate high-level summit with these countries, dubbed the 16 + 1 forum (17 + 1 after the addition of Greece). Meanwhile, the full-scale EU-China summits in 2016 and 2017 reflected the growing divergence between the two governments by failing to produce a joint communique on both occasions. By 2018, the larger Member States, notably France, Germany and, until it formally left the EU in January 2020, Britain, were unilaterally taking a stronger line regarding China. Beijing’s resumption of blatant human rights violations, including the mass detention of members of its Uighur minority and its violent crackdown on youth protests in Hong Kong, reinforced the sense that China’s political trajectory was increasingly authoritarian. This time these views began to find reflection in EU policies as well (Stanzel et al. 2016; Smith 2020). In March 2019, the European Commission and the European External Action Service put out a joint strategic reflection paper which was notable for its blunt language regarding China. It described Beijing as ‘a negotiating partner with whom the EU needs to find a balance of interests, an economic competitor in the pursuit of technological leadership and a systemic rival promoting alternative models of governance.’ It put out a 10-point action plan regarding China, all of which were endorsed by the European Council. Some commentators noted that besides the language,

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the paper was noteworthy because of the speed with which it was put together. This reflected the concerns of Commission President JeanClaude Juncker, German Chancellor Angela Merkel and French President Emmanuel Macron of the need for a stronger EU ‘common position on China ahead of crucial meetings that year’ (European Commission 2019a; Brattberg and Le Corre 2020). A month later, the EU finalized an investment screening mechanism that laid out a system of scrutinizing Chinese acquisition of critical assets, technologies and infrastructure. A number of European countries, like Germany and France, had unilaterally been blocking the takeover of firms targeted by China because of their technological capabilities. The new EU policy now put together a community-wide response which would come into force in late 2020. The Commission also released a set of recommended measures on which to assess the risk of foreign 5G telecom equipment, largely a fallout of concerns about the security implications of using 5G equipment built by Chinese firms like Huawei (European Commission 2019c, 10 April; 2019b, 26 March). In just over a decade, the EU had moved from believing it could persuade China to take a more benign development trajectory to seeing China as a threat, formulating policies to counter widespread Chinese intrusions into Europe’s economic and political structure. In much the same way as it had done with Member States of the Association of Southeast Asian Nations, Beijing was buying the loyalty of smaller and poorer European governments. While the EU had developed a number of policies to tackle China, these remained largely on paper and it remained to be seen whether they would amount to what the 2019 reflection paper called a ‘whole of EU response.’ Beijing was also showing signs of hubris, or simply a belief that the rift between the US and Europe and the EU’s overall weakness meant it didn’t need to concern itself with European opinion. By 2019, even some of the Central European Member States began to question their relations with China, largely because of unfulfilled economic promise and predatory economic policies. A number of smaller European countries, like the Czech Republic and Sweden, experienced bruising political and economic battles with China in 2019 and 2020. However, Germany and Britain were among the European governments who decided that they would not put a ban on Huawei equipment in the development of their 5G telecom network, much to the irritation of the US. Italy became the first major European country to endorse the BRI. There remains a sense

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of a Europe that continues to hope China will become reasonable and constructive in at least its economic policies. A stance, it should be added, partly legitimized by the unilateral and isolationist policies of US President Donald Trump. An additional problem for Europe has been the rise of right-wing populist governments and parties in many European countries who do not ascribe to the post-modern ethical concerns on which the EU was founded (Muller 2020).

India Shift In contrast to the up and down of its relations with China, those between the EU and India have for decades been consistent—and insubstantial. There is an assumption that India, a democracy with a vibrant civil society, would be a more natural partner for a postmodern political structure like today’s Europe. This has not proved to be the case. There are a number of reasons why this has been the case. However, recent years have shown that these barriers are becoming eroded. One has been the lack of an economic underpinning comparable to that which exists between the EU and China. The EU is India’s largest trading and investment partner. For the EU, however, India is a middlesized trading partner with bilateral trade worth $108 billion in 2018, about one-tenth the business that it does with China. The investment story is not much better, especially if Britain is taken out of the equation. The EU, including Britain, accounted for just over a quarter of the total foreign direct investment in India. But the cumulative total of EU foreign investment into India is comparable to the annual EU investment in China—though the latter has been declining since 2016. India was roughly on the same level as South Korea and Brazil as an economic partner for the EU—and after Brexit, the amount will be even less (Hanemann and Mikko 2018; Hunya and Stollinger 2009). Two, India was for a long time treated by continental Europeans as the diplomatic monopoly of Britain. ‘We have deferred to London when it comes to your country,’ said a German diplomat to me several years ago. They have thus been blinded to the thinning of the Anglo-Indian relationship over the past few decades, a dilution in large part because of the displacement of Commonwealth ties by Britain’s strengthening identification with Europe (Pal Chaudhuri 2011). Some of the reasons for neglect are eccentric. French scholars, for example, designated India a member of the ‘Anglosphere’—a linguistic break-up of the world quite foreign to

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Indian thinking. They have been surprised, when they dig deeper, they find no Indian interest in the idea (Lisbonne de Vergeron 2006). Third, minus Britain, there has been minimal people-to-people exchange between India and continental Europe. The Indian diaspora in any of the major continental European nations has been remarkably small and lacking in any influence in these countries. The Indian population in the largest continental European country, Germany, is 43,000 in 2015. The largest Indian continental diaspora is in Italy but it is largely working class, lacking profile or influence (India, Ministry of External Affairs 2015). This has been a crucial element in the development of Indo-US relations, for example, including building technological and service economy linkages. Finally, and what arguably has made deeper relations between the two governments so difficult for so many decades, are two contrasting views of sovereignty, as mentioned earlier. Among all the emerging economies, India is arguably the most sensitive about the issue of sovereignty. Even when compared to China, a country imbued with a similar sense of nationalism, India is far more averse to the idea of surrendering sovereign power to multilateral or even bilateral understandings. In a study based on interviews of the strategic elites of India and China, Rollie Lal found that her Indian responders were singularly focussed on the need for their country to maintain the sovereignty of decision-making in the international arena. So much so that even the purpose of developing military capability was less about security than about providing leverage to maintain that sovereignty. Chinese respondents, on the other hand, saw the territorial integrity of their country and the maintenance of domestic stability as being their priorities. These were issues that barely figured on the Indian radar, so confident were Indians of their democratic polity and institutions (Lal 2006: 4). Three of the five original major EU foreign policy priorities—the advancement of human rights, prevention of violent conflict and the promotion of good and democratic governance—are deep in the minefields of Indian sovereignty (Smith 2008). For years, the EU’s postmodern interests, positive attitude towards China and limited hard power in Asia made it difficult to find areas of strategic convergence with India. Relations tended to revolve around values, trade and similar diplomatic dead-ends. India does not expect Europe to contribute much to resolving its forever dispute with Pakistan. It assumes the EU cannot even dream of standing up to China, given

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Brussels’ track record on that front. India, therefore, has traditionally assumed a lack of strategic convergence with Brussels ( Lisbonne de Vergeron 2006). India has preferred to have the US as its primary interlocutor in the West for almost all its foreign policy concerns. Not only is the US a major power in the Indo-Pacific, it thinks in a more realpolitik and geopolitical fashion—a modernist paradigm Indian officials are more at ease with. A 2009 official interaction between the EU and US on South and Central Asia is revealing. The State Department official repeatedly asked how India could be persuaded to be a more active player in the region, noting that the ‘US was interested in new ideas on how we could work with the EU to engage India.’ He added ‘the US felt that India was also ready to play a larger and more collaborative role in international organizations…and in the region.’ The US wanted a ‘dialogue’ with India on Burma and saw India as ‘absolutely critical’ regarding AfghanistanPakistan. The EU official seems to have had few ideas regarding India, offering no suggestions on how to engage New Delhi. He felt China had been more constructive on Burma than India. His only response was to raise the Kashmir issue—and to be told by the US side that ‘it was publicly off the table’ (Wikileaks 2009a). No issue exemplified how India and the EU used to sail past each other than the Kashmir dispute, a policy concern that brought out the worst in Indian touchiness about sovereignty and the most of Brussels’ belief its primary overseas agenda was human rights and conflict resolution. Through the mid-2000s, helped by a period of relative quiet in Kashmir and Brussels’ concerns about China, the two sides sought to hammer out a more constructive policy. After years of bickering on Kashmir, since 2008 the two seem to have developed a formula for handling the Kashmir that keeps it from muddying bilateral ties including shunting human rights issues to a closed-door dialogue and allowing EU delegations to the state (One World South Asia 2012, 3 January). Brussels’ statements from 2012 onwards indicate a more passive EU position on Kashmir. The Asia head of the EU External Relations Directorate, asked about third-party mediation in the Kashmir dispute, responded ‘such a course of action would require conditions which are not presently met’ (Racine 2015: 17). New Delhi and Brussels began reassessing their relationship in the mid2000s. Brussels de-prioritized human rights and free trade. There was interest in moving the relationship to other areas. There were external

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drivers of change. The two sides both had concerns at China’s advocacy and export of a model built around statist economics, technology-based surveillance and increased domestic repression. Brussels was rattled by the isolationist and openly anti-European policies of the Trump Administration. India and Europe worked closely together to save the Paris Accord on climate change after the US announced its intention to withdraw from the treaty. Over a number of years, India and the EU saw their agenda change. Kashmir, as mentioned, was marginalized. The EU downgraded the importance of the India FTA. Brussels concluded that given the challenge the US was posing to the international trading system, it needed to focus on negotiating large numbers of bilateral and plurilateral trading agreements. The India FTA was seen as a lower priority because of the smaller likelihood of success, and Juncker, in his meeting with Modi in October 2017, privately said the EU was prepared to put off a final agreement.2 Much of this new thinking was to be found in a new EU policy paper on India issued in November 2018. While its origins predated both Brexit and the election of Trump, the two events gave the document a sense of greater urgency. The paper was driven by the EU’s desire for ‘middle power cooperation’ to compensate for the unilateral actions of US and China. India was seen as a major contributor to climate policy, maritime security, nuclear nonproliferation and support for multilateral institutions like the United Nations and the WTO. Importantly, it argued ‘the EU has an interest in India playing a greater role in a multipolar world, which requires a multipolar Asia.’ In other words, supporting India’s ‘sustainable modernization’ was implicitly accepted as in the EU’s strategic interest. In return, India and the EU would work together in places like Africa, West Asia and the Indian Ocean and other areas where their ‘extended neighbourhoods’ overlapped (EEAS 2018).3 Brussels found New Delhi more receptive to the idea of a more active bilateral relationship. India’s new attitude towards the EU was partly because of Trump, but was as much because of Brexit. India had tended to treat Britain as its gateway to Europe and even its window on the EU. The 2016 Brexit vote forced a major rethink in New Delhi about how it would engage with Europe. During a four-nation tour in May

2 Private conversations with German diplomats in New Delhi, December 2017. 3 Private conversations with European diplomats.

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2017, Modi met the newly-elected French President, Emmanuel Macron, German Chancellor Angela Merkel and the Spanish Prime Minister, Mariano Rajoy. As Indian officials explained, this was partly to start developing a triangle of relationships in preparation for a post-Brexit Europe.4 Rajoy fell from power soon after, but Modi’s visit was still noteworthy as no Indian prime minister had visited that country for 29 years. Modi followed this up with a ‘Nordic summit’ where he met the heads of five Nordic countries in a joint summit in Stockholm in April 2018. In other visits, the Indian prime minister has gone to Italy, Belgium, the Netherlands, Portugal, Switzerland and Ireland. As an EU diplomat noted, ‘India’s reconnect with Europe is a recognition that even without Britain this is India’s primary source of trade, foreign investment and technology’ (First Post 2017; The Hindu Business Line 2018). European countries have belatedly also become more active in strategic issues that matter to India, especially in developing strategies to counter the rising influence of China in the Indian Ocean and Africa, whether through an increased military presence or the BRI. France, the only European state with a physical and military presence in the Indian Ocean, was the most active on this front. Germany also announced an ‘Indian Ocean strategy’ in 2017 though it was largely economic in nature, as did Britain though the latter has had a military facet. In 2019, the EU announced a connectivity plan between Europe and Asia and, a year later, finalized a new Africa strategy. Both were designed to counter or least provide an alternative to what China was doing on the ground. This held out the possibility of working cooperatively with India, which was working on similar strategies in conjunction with Japan and the US, at some point in future (Pal Chaudhuri 2017; Pant and Kaura 2019). Rhetorically, at least Brussels is beginning to weave in more power politics in its foreign policy statements. European Commissioner Ursula von der Leyen, presenting her team of Commissioners to the European Parliament, while iterating the EU’s desire to be ‘the shapers of a better global order,’ noted that Europe ‘urgently needs’ a more ‘geopolitical commission’—a sign that even Brussels recognizes that changing global realities meant the resumption of the balance of power, realpolitik thinking that European unity had sought to jettison (von der Leyen 2019).

4 Private conversation with a senior Indian diplomat, New Delhi, June 2017.

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Conclusion The EU’s original foreign policy parameters placed a priority on postmodern values, most notably human rights and traditional liberal positions like free trade. In a period during the 1990s, it sought to export this model by using Europe’s economic and diplomatic clout to modify the behaviour of other countries. This was led to difficult relations with China and India, modernistic states who saw these as infringements on their sovereignty or the EU as simply irrelevant to the problems of their region. China, however, was able to offset these issues with a huge trade and investment relationship. A more protectionist India had little to offer in the way of economic leavening so its relations with EU were often equally rambunctious, despite being a democracy. Through the 2000s, the EU-China relationship deteriorated sharply. Brussels and major European governments became increasingly concerned that rather than being able to moderate Beijing, China was developing a large and corrosive political and economic footprint inside Europe and in European areas of influence like Africa. The election of Donald Trump in 2015 meant the EU had to also contend with the first US President to be openly hostile to the Atlantic alliance. India, on the other hand, was also perturbed at Chinese assertiveness, US isolationism and their combined impact on the international system. The EU and India began a broader reassessment of their relationship in which common views on international institutions, climate change and the like began to overshadow the original bilateral agenda of human rights and trade. The EU and India have an opportunity to create a genuinely strategic relationship but this will depend on the EU being able to come through a number of severe domestic challenges and come to accept the right-wing turn in India’s own polity.

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24, 2020, from https://www.cer.org.uk/publications/archive/report/2005/ embracing-dragon-eus-partnership-china. Hanemann, T., & Huatori, M. (2018). EU-China FDI: Working Towards Reciprocity in Investment Relations. Merics Papers on China, May, Retrieved March 25, 2020, from https://www.merics.org/sites/default/files/201808/180723_MERICS-COFDI-Update_final_0.pdf. The Hindu Business Line. (2018, 18 April). India, Nordic Countries Vow to Strengthen Ties. Retrieved March 24, 2020, from https://www.thehindub usinessline.com/news/world/india-nordic-countries-vow-to-strengthen-ties/ article23581102.ece. Human Rights Watch. (2013, 24 June). EU/China: Overhaul Human Rights Dialogues. Brussels. Retrieved March 24, 2020, from https://www.hrw.org/ news/2013/06/24/eu/china-overhaul-human-rights-dialogues. Hunya, G. & Stollinger, R. (2009, December). Foreign Direct Investment Flows between the EU and the BRICS. Research Reports No. 358. Vienna: Vienna Institute for International Economic Studies. Retrieved March 25, 2020, from https://wiiw.ac.at/foreign-direct-investment-flows-between-the-eu-andthe-brics-dlp-1960.pdf. India, Ministry of External Affairs. (2015). Population (Estimate/Assumed) of Overseas Indians: Country Wise. Retrieved March 25, 2020, from https:// mea.gov.in/images/pdf/3-population-overseas-indian.pdf. Lal, R. (2006). Understanding China and India: Security Implications for the United States and the World. Westport, CT: Praeger Security International. Lisbonne de Vergeron, K. (2006). Contemporary Indian Views of Europe. London: Chatham House. Retrieved March 24, 2020, from www.chathamho use.org/publications/papers/view/108304. Monnet, J. (1978). Memoirs. New York: Doubleday. Muller, R. (2020, 9 March). Czech Prime Minister says China’s Ambassador Should be Replaced. Reuters. Retrieved March 25, 2020, from https://www. reuters.com/article/us-china-czech/czech-prime-minister-says-chinas-ambass ador-should-be-replaced-idUSKBN20W1EH. Olsson, J. (2019, 30 December). China Tries to Put Sweden on Ice. The Diplomat. Retrieved March 25, 2020, from at https://thediplomat.com/ 2019/12/china-tries-to-put-sweden-on-ice/. One World South Asia (2012, 3 January). Press Release: EU Supports Kashmir Reconciliation. Retrieved January 31, 2019, from https://southasia.one world.net/news-you-can-use/press-release/eu-supports-india-pakistan-reconc iliation-process-over-kashmir. Pal Chaudhuri, P. (2011). Corporate Britain Has a Blind Spot About India and It Needs to Wise Up Fast. Parliamentary Brief . Retrieved

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CHAPTER 2

India, Europe and Asian Regional Organizations Anil Wadhwa

Introduction The policy of Europe/the European Union towards Asia draws on its economic strength as well as its comprehensive approach while dealing with individual countries of the region. Brussels’ security policy also encompasses non-traditional security issues. Asia is getting increasing attention not merely because of its volatile political and security situation and tensions among regional and other powers but also because it has emerged as the economic powerhouse of the world in the twenty-first century. As one of the fastest-growing large economies with democratic values, growing influence and as a young and dynamic workforce, India is increasingly seen by the European Union as an ideal partner in Asia.

A. Wadhwa (B) Former Secretary (East), Ministry of External Affairs, Government of India, New Delhi, India © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 R. K. Jain (ed.), India, Europe and Asia, https://doi.org/10.1007/978-981-33-4608-6_2

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Europe and Asia Ever since the end of the Cold War and other developments in global markets and geopolitics, the focus has shifted from the Euro-Atlantic to the Asia–Pacific region. In its efforts to maintain its partnerships with the emerging powers and regional groupings, the European Union has sought to ensure that its policies take due cognizance of changes in the Asia–Pacific. Mindful of its substantial interests, the EU has, in recent years, stepped up its constructive engagement in and with the Indo-Pacific, including more visits, mediation efforts, increased financial assistance and more statements, which are all proof of greater EU activism and commitment. In July 1994, for the first time ever, the European Commission adopted a policy paper designed to launch a radical rethink of the European Union’s strategy towards Asia. The document, entitled ‘Towards a New Strategy for Asia’, did not set out a comprehensive set of specific policy actions but aimed instead to inject urgency into the definition of the European Union’s approach towards Asia, spearheading a debate that led EU policymakers at the national and European level to give Asia the priority it deserved (European Commission 1994). Seven years later, the ‘Europe and Asia Strategy for Enhanced Cooperation’ identified six major objectives for inter-regional cooperation such as strengthening peace and security, increasing mutual trade and investment flows, enhancing development cooperation, protecting human rights, democracy promotion, good governance and mutual awareness raising (European Commission 2001). The European Security Strategy (2003) specified the EU’s interest in the Asia–Pacific region, focusing on the challenges posed by nuclear proliferation and terrorism (European Council 2003). The South China and East China Sea are regular news features in Europe and are perceived as being of direct relevance for European security. Brussels strongly advocates diplomatic and peaceful conflict resolution according to international law, without any threat or use of force. The ‘Guidelines on the EU’s Foreign and Security Policy in East Asia’ (2012) reflect a similar approach (European Council 2012). The EU-anti-piracy operation ATALANTA off the coast of Somalia had a strong ‘Asian’ element, as well its indispensable contribution and role in ReCAAP (Regional Cooperation Agreement on Combating Piracy

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and armed robbery against ships) through the membership of Netherlands along with Denmark, Norway and UK from the continent have been significant. The European Union became an Observer in the South Asian Association for Regional Cooperation (SAARC) in 2006. The EU is one of 14 dialogue partners for the Pacific Islands Forum along with India. Since the 2008 Eurozone crisis, Europe has sought to proactively engage Asia and revive the hitherto underestimated ties between the two continents. The EU broadened its Asia policy and expanded its focus beyond China (Young 2015).

India and Asia India has emerged as a strong and indispensable player in Asia and the larger Indo-Pacific region, which has assumed increasing importance in recent years. India was woken up to the necessity of an open economy in the early 1990s in an unipolar world order. The then finance minister— and later a Prime Minister—Dr Manmohan Singh, under the leadership of Prime Minister P.V. Narasimha Rao, paved way for historic reforms in India’s political and economic system. The ‘Look East Policy’ (1992) came as a respite to the inward-looking Indian economy, which then resolved to establish its ties with the developing economies of the East, with whom ancient India has shared a rather impressive relationship (see Jaffrelot 2003; Sikri 2009). Since the adoption of its Look East Policy, India has forged closer institutional links with the Association of Southeast Asian Nations (ASEAN). Thus, in January 1992, India became a sectoral dialogue partner for tourism, commerce, investment, and science and technology, full dialogue partner in December 1995, a member of the ASEAN Regional Forum (ARF) in July 1996 and with annual ‘ASEAN plus One’ summit-level dialogue since December 2002 (see Wadhwa 2020). India has sought to deepen its economic and cultural ties with the Southeast Asian economies and play a more proactive role to consolidate its ties with its Asian neighbours. Realizing the multilateral approach which integrates the different areas in Asia, India has also been a leader in proposing and sustaining institutions that can bring growth and development for all. Since the 1990s, every successive government has launched various policies in order to augment engagement in the regional and sub-regional fora. The present government placing practice over preaching, Prime

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Minister Narendra Modi has indicated India’s willingness to promote multilateralism with the ASEAN multilateral institutions.

The European Union and ASEAN Both Europe and India realize that there is a need for greater integration with ASEAN, which has emerged as a dynamic grouping over the years. The ASEAN comprises 1.85 billion people with a combined GDP of $3.8 trillion. With decades of experience in integration and multilateralism, the European Union is supporting ASEAN and ASEAN-led efforts in fostering a security architecture in Asia which can address the various challenges that the region confronts. To that end, Brussels is guided by a comprehensive approach and seeks to use various diplomatic, political, economic, humanitarian instruments in its toolbox and that of other Member States. This enables it to address the root causes of these challenges in a long-term and strategic manner and thereby make it possible for the EU to establish itself as a responsible actor in the region. The Brunei Plan of Action (2013–2017) followed by the current EU-ASEAN Plan of Action (2018–2022), for instance, has served to strengthen EUASEAN security cooperation on a wide range of (non-traditional) security issues, including maritime security, border management, mediation and crisis response (ASEAN 2017).

The European Union and ARF Along the same lines, the EU has sought an active participation in the ASEAN Regional Forum (ARF) to share know-how and engage in a political and security dialogue supplementing bilateral activities. For the EU, the ARF stands an important forum in the Asia–Pacific for advocating its security policy concepts and promoting confidence-building and preventive diplomacy. Concurrently, it is seen promoting the rule of law, good governance, democracy and respect for universal human rights to strengthen stability and to support transition processes in places like Myanmar and post-2014 Afghanistan (European External Action Service 2014).

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India and ASEAN When we talk of policy reforms in India under the umbrella of multilateralism, the most salient one was announced with the shift from ‘Look East Policy’ to the ‘Act East Policy’ at the twelfth India-ASEAN Summit. India’s relationship with ASEAN has emerged as a cornerstone of its foreign policy. India became a Sectoral Partner of ASEAN in 1992, a Dialogue Partner in 1996 and a Summit-level Partner in 2002. The upgradation of this partnership to a strategic partnership during the celebration of the twentieth anniversary commemorative summit at New Delhi in 2012 was a natural corollary to the growth of the IndiaASEAN relationship during last two decades. However, the India-ASEAN strategic partnership acquired a new momentum with the Act East Policy which emphasizes connectivity, commerce and culture as the focus areas of action for a greater ASEAN-India integration. It takes into account the blueprints of the three pillars of the ASEAN community-building process, the ASEAN vision document ASEAN 2025-Forging Ahead Together, the ASEAN Master Plan for Connectivity 2025, the ASEAN ICT Master Plan 2020 and the Initiative for ASEAN Integration Work Plan III (India, Ministry of External Affairs 2019). New Delhi’s relations with ASEAN have become multifaceted to encompass security, connectivity, strategic, political, space technology, counterterrorism and anti-insurgency operations, anti-radicalization, trade and investment, maritime security and defence collaboration, in addition to economic ties. Cooperation to curb terrorism especially in the face of the rising influence of the Islamic State has assumed priority. Defence partnerships with several ASEAN states are advancing rapidly. India and some of the ASEAN states believe that India should play a still greater diplomatic and security role in the region. This could include a larger naval presence with a force capable of operating in open seas and projecting power to areas of strategic interest (Mishra 2016). India and ASEAN are natural partners in their desire to create a free, open and inclusive regional architecture. They are active participants in the East Asia Summit (EAS), ASEAN Regional Forum, ASEAN Defence Ministers Meeting Plus (ADMM-Plus) and the Expanded ASEAN Maritime Forum (EAMF) (Sajjanhar 2018). ASEAN is India’s fourth largest trading partner, accounting for 10.6% of India’s total trade. In 2018, bilateral trade stood at $81.33 billion, and India’s exports to ASEAN account for 11.28% of its total exports. ASEAN has invested

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US$69.91 billion between April 2000 and March 2018 into India, and India has invested US$36.67 billion in ASEAN between 2007 and 2015. While the ASEAN-India FTA in goods has gone into force, some ASEAN countries like Cambodia are yet to ratify the ASEAN-India trade in services agreement. India is also a part of the ASEAN-led Regional Comprehensive Economic Partnership (RCEP), which, when concluded and implemented, will cover almost 40% of the world’s population, 33% of global GDP and 40% of world trade (Sajjanhar 2018).

Connectivity Connectivity has been ranking high between India and ASEAN, and particularly, Myanmar and Thailand have emerged as significant countries in cementing bonds between the two regions. Better infrastructure connecting Northeast India and ASEAN has become the sine qua non for stronger economic and trade partnership and vital contributor to prosperity and economic development of the region. Two major connectivity projects, viz. the Trilateral Highway between north-east India and Myanmar and onwards to Thailand (and Laos and Vietnam) and the Kaladan Multimodal Transit and Transport Project, have been under implementation for several years (Sajjanhar 2018). India is concentrating connectivity with ASEAN through land, but also through sea and air in order to cut down costs for movement of goods and services between India and ASEAN. The trilateral highway will plug into the four-lane highway with the ASEAN master plan on connectivity and the ASEAN East–West Corridor. A $1 billion credit line had been announced by Prime Minister Modi in 2015 to enhance digital and infrastructure connectivity with ASEAN. A sum of $77 million has also been committed towards developing manufacturing hubs in the Cambodia, Myanmar, Laos and Vietnam (CMLV) countries. India has also proposed the augmentation of air connectivity to and from the region which will help business ties with the ASEAN. Sea connectivity is also vital between the eastern seaboard of India and CMLV countries, and there is a need to improve trans-shipment links. An agreement of maritime transport and an air services agreement between India and ASEAN are also being considered.

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The European Union and ASEAN EU and ASEAN, too, have developed congenial relations, based on more than a few common ideals that run both these organizations individually. They are seen as natural partners in furthering each other’s aspirations and influence in international affairs. Both organizations promote cooperation and the peaceful balancing of interests in their respective regions. Both the EU, with its 28 Member States, and the ASEAN’s ten Member States work to foster a multilateral world order. They are united in the firm belief that the major global challenges of our time, such as the future of globalization, climate change and trade issues, can only be met by working together. As a result, ASEAN and the EU have been close dialogue partners for over 40 years (The EU and ASEAN—Partners for Joint Action in Europe and Asia, 2019). In 2007, ASEAN and the EU adopted the Nuremberg Declaration on an EU-ASEAN Enhanced Partnership. The Declaration aimed at establishing a long-term vision of and commitment to cooperation and represented a major milestone in ASEAN-EU relations. More importantly, 2012 is recognized by the EU as a turning point in the inter-regional relationship (Xuechen 2018: 223). In 2012, the EU ‘shifted to a different gear and placed ASEAN firmly on its radar screen’ (Nuttin 2017: 20). In July 2012, the EU acceded to ASEAN’s Treaty of Amity and Cooperation and adopted the Plan of Action (2013–2017) to strengthen the ASEAN-EU enhanced partnership (ASEAN 2012). In 2015, the EU initiated a Joint Communication calling for an ASEAN-EU partnership with strategic purpose and appointed an ambassador to ASEAN in Jakarta. The EU’s revised understanding is evident from a number of recent official documents of various EU institutions. Crucially, in May 2015, the EU adopted a Joint Communication entitled ‘The EU and ASEAN: A Partnership with a Strategic Purpose’, which, for the first time, specified that the Union has ‘a strategic interest’ in strengthening its relationship with ASEAN because it was ‘the heart of the efforts to build a more robust regional security order in the wider Asia Pacific’. ‘A united and self-confident ASEAN’, it added, was ‘a key to ensure that regional challenges are addressed in a rule-based manner’ (European Commission 2015: 1). Based on this Joint Communication, the Council of the EU subsequently published the ‘Council Conclusions on EU–ASEAN Relations’, which re-emphasized the necessity of developing an ASEAN-EU strategic partnership (European Council 2015). Similarly, a report by the European

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Parliament published in March 2017 characterized ASEAN as ‘one of the world’s most dynamic and fastest-growing regions’ and ‘a strong advocate of multilateralism’ that is ‘strategically located’ in international politics (European Parliament 2017). Considering ASEAN’s centrality in leading the multilateral mechanisms in addressing non-traditional security issues in the Asia–Pacific region, the EU now hopes to forge closer ties with ASEAN in non-traditional security cooperation in order to establish its role as a security and political actor in Asia. This suggests that the expansion of ASEAN-EU development aid and security cooperation is viewed by the EU as a crucial opportunity to leverage its political and security influence in Asia. Accordingly, the EU has significantly increased its funding for development cooperation with ASEAN for 2014–2020, dedicating over e170 million to the post-2015 ASEAN regional integration agenda—more than double the amount for 2007–2013 (European External Action Service 2016). The European Union has also expanded the areas of development aid cooperation with ASEAN, ranging from connectivity, economic integration and human rights dialogue to various non-traditional security issues such as food security, climate change, maritime cooperation and disaster management; ASEAN and the EU share many of these climate policy interests, an area where the Union is considered to be a global leader. The EU is an important partner of ASEAN in combating the effects of climate change. In recent years, Brussels has made great efforts to identify new synergies for cooperation with ASEAN on traditional security issues. For instance, the latest ASEAN-EU Enhanced Partnership Plan of Action (2018–2022) highlights the need to ‘enhance dialogue and promote cooperation with the EU on defence and security matters’ and to ‘support exchange of views between security and defence officials’ (ASEAN 2017: para 1.2 (c), (d)). The EU not only initiated the High-Level Dialogue on Maritime Cooperation with ASEAN in 2013, but also started organizing the Orientation Courses on the EU Common Security and Defence Policy with a particular focus on ASEAN-EU relations in 2014. In 2016, the EU participated for the first time in a multinational naval exercise hosted by Indonesia (Xuechen 2018: 236). Apart from proposing new initiatives for cooperation, the European Union has expressed keen interest in becoming a security provider in the region, hoping to increase its engagement with the key ASEAN-led security forums, including the East Asia Summit and the ASEAN Defence

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Ministers’ Meeting Plus (ADMM-Plus). Thus, the EU has ‘significantly reshaped its policy goals and strategies’ regarding ASEAN by adjusting trade policy, proposing new initiatives, increasing funding and expanding its areas of cooperation with ASEAN (Xuechen 2018: 237).

The European Union and the East Asia Summit The European Union decided to sign up collectively for the East Asia Summit (EAS) in 2006. However, ASEAN demands a treaty change since the EU was not an entity (Parello-Plesner 2010). The EU was invited to attend the East Asia Summit for the first time in November 2017. ASEAN has now completed the requisite amendments to the Treaty of Amity. However, even if the Union were invited to be a full member in future, it will be necessary that it is represented by one leader, rather than several, at EAS summits. A major reason why EU-ASEAN relations have been rocky in the past has been due to conflicts over values and norms. For over two decades, Myanmar has been an impediment. The EU’s insistence on human rights has been adjusted over time due to the democratic changes, however imperfect, brought about in Myanmar. The withdrawal of the United States from the Trans-Pacific Partnership (TPP) and the Paris Accord on Climate Change has also provided greater leeway to the EU to step in and strengthen its case for a membership of the EAS. Other geopolitical or material factors such as economic growth in Southeast Asia, adjustments to America’s Asia policy under President Donald Trump, the Eurozone crisis as well as the rise of China have impacted the development of ASEAN-EU relations (Xuechen 2018: 237).

The European Union and the Asia–Pacific Financial Dialogue Valdis Dombrovskis—European Commission’s Vice President for the Euro and Social Dialogue, also in charge of Financial Stability, Financial Services and Capital Markets Union—emphasized in a speech at the second annual EU-Asia–Pacific Forum on Financial Regulation in Hong Kong in December 2017: [F]or the next few decades, Asia’s economic growth is expected to lead the world. As your countries leap forward in economic and technological

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progress faster than anyone has before, your financial systems will evolve in tandem. At the same time, financial integration within the Asia Pacific region will keep advancing, just like it has done in the European Union’s single market. (Dombrovskis 2017)

The structures of the Asian and EU financial sectors are fairly similar. The main Asian and EU financial sectors are ‘all bank dominated’ like most financial sectors around the globe. Both the EU and many of the Asian countries are looking to diversify their financial sectors with the development of their capital markets. In the EU, the aim is primarily to create an alternative to banks, whereas in Asia most countries would like to develop their local currency bond markets to reduce the reliance on debt denominated in foreign currencies such as the US dollar (De Groen and Hooijmaaijers 2018: 105–106). Since 2016, regulators from the EU and the Asia–Pacific region hold an annual EU-Asia–Pacific Forum on Financial Regulation. With this forum, Commissioner Dombrovskis remarked, ‘we want to work with you towards mutual recognition of rules and a shared vision for growth and financial integration’ (Dombrovskis 2017). For those third-country jurisdictions holding regulatory dialogues with the EU such as Japan, China and Southeast Asian countries, these fora offer an opportunity to discuss difficulties and further enhance understanding (European Commission 2019). ASEAN as a whole represents the EU’s third largest trading partner outside Europe (after the United States and China) with more than e227.3 billion of trade in goods in 2017. Bilateral trade in services amounted to e76.8 billion in 2016. The EU is ASEAN’s second largest partner after China, accounting for around 13% of ASEAN trade. The EU is by far the largest investor in ASEAN; in 2016, the FDI stock into ASEAN accounted for e263 billion. ASEAN investment in Europe has also been growing steadily and reached e116 billion in 2016. In order to facilitate trade between Europe and the economically dynamic ASEAN region to an even greater extent, the EU is currently negotiating free trade agreements with several ASEAN Member States. In the long term, the EU and ASEAN are pursuing the ambitious goal of establishing free trade between the two economic regions as a whole (Germany Foreign Office 2019).

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Asia-Europe Meeting (ASEM) The Asia-Europe Meeting (ASEM) was inaugurated in 1996 and fosters dialogue in politics, economics and between the peoples. It has steadily progressed to become more efficient, more visible, but has yet to develop its full potential. The grouping was founded at the initiative of Singapore and France, and has expanded from its original membership of 26 to include 53 members today. On the European side, these are all 28 EU Member States, the European Union, Switzerland and Norway; on the Asian side, they comprise China, Japan, India, South Korea, Brunei, Indonesia, Cambodia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand, Vietnam, the ASEAN Secretariat, Pakistan, Australia, New Zealand, Sri Lanka, Bangladesh, Russia and Kazakhstan (Regional Organisations in Asia). As one means of facilitating deeper economic integration, there remains much talk of upgrading region-to-region measures through the biennial ASEM summits. The standard refrain speaks of ASEM unlocking qualitatively new, networked forms of economic cooperation, beyond the traditional trade and investment agenda. China and Singapore raised the possibility of an ASEM free trade agreement, but there was little enthusiasm for discussing it seriously among other members. Some Asian states have been keen on creating a permanent ASEM secretariat, but most EU Member States do not see value in that proposal. As a result, the overall EU policy still requires wider constituencies within a larger number of Member States who see the strategic importance of Southeast Asia and South China Sea issues, which hold the key to several aspects of international security, commercial relations and global problem solving. And, conversely, Asian states need to look beyond their own immediate region to see the value of working with Europe on the big global challenges that affect them as much as the EU (Young 2015).

The ASEAN-EU FTA The EU has changed its previous ambitious plan to conclude a regionto-region free trade agreement (FTA). In its place, Brussels has adopted a more pragmatic and flexible trade policy towards ASEAN. After the suspension of negotiations on an ASEAN-EU FTA in 2009, the focus of the EU’s strategy switched to negotiations with individual ASEAN countries—including Thailand, Indonesia, Malaysia, Singapore, Vietnam and the Philippines—because the EU believes that bilateral FTAs will lay the

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foundation for the establishment of a regional-level FTA. As one official from the Directorate General for Trade observed, ASEAN’s norms, such as its adherence to state sovereignty and its high degree of internal heterogeneity, have prompted the EU to redefine its interests and policy objectives in the region and develop an increasingly pragmatic approach towards ASEAN. The EU now tends to rely on a multipronged approach that combines bilateral and multilateral characteristics. That is, in addition to pursuing bilateral FTAs with individual ASEAN countries, the EU has proposed to discuss ‘the next steps towards the resumption of the ASEAN-EU Free Trade Agreement negotiations’ and to ‘develop a framework encompassing the parameters of a future ASEAN–EU FTA’ (cited in Xuechen 2018: 236).

Asia Connectivity In recent years, the new buzzword has been ‘connectivity’—a central theme for ASEM, the Belt and Road Initiative (BRI) as well as EUASEAN relations. To make a further step change in that cooperation and to unlock opportunities within the global economy, the European Union, primarily due to Chinese perseverance, has come around to the view that the EU and Asia should ensure an efficient and sustainable connectivity. Connectivity seeks to contribute to economic growth and jobs, global competitiveness and trade, and people, goods and services to move across and between Europe and Asia. This Communication was a part of the EU contribution for the twelfth Asia-Europe Meeting summit held in Brussels in October 2018, which offered the opportunity to promote connectivity and advance cooperation with Asian partners. The EU experience enables it to promote an approach to connectivity, which is sustainable, comprehensive and rules-based. Thereby, the EU aspires to engage with its Asian partners along three strands. First, by contributing to efficient connections and networks between Europe and Asia through priority transport corridors, digital links and energy cooperation at the service of people and respective economies. Second, by establishing partnerships for connectivity based on commonly agreed rules and standards enabling a better governance of flows of goods, people, capital and services. Third, by contributing to address the sizeable investment gaps through improved mobilization of resources, reinforced

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leveraging of EU’s financial resources and strengthened international partnerships.

There is a strong focus on addressing the transport, energy and digital links between Europe and Asia, while taking into consideration the rapid technological change, which has a strong impact on connectivity. The underpinning principles in building these connections reaffirm the sustainability and positive environmental and climate impacts such as long-term decarbonization of air transport, and promote the use of alternative fuels in ports in Europe and Asia, modernization of the energy systems and the adoption of clean (decentralized) solutions, in case of energy connectivity (European Commission 2018: 3). There is a consensus among EU Member States though that their strategic partnership is void of substance. The dialogue on maritime security also cannot be equated with a security strategy.

The European Union and Security Cooperation in Asia Security has emerged as a major area of potential collaboration between India and the EU vis-a-vis ASEAN, given the rise of security challenges in the Indo-Pacific, fuelled largely by the belligerent rise of China. ASEAN, other Southeast Asian countries and the international community, in general, do not wish to see the South China Sea being converted into waters where freedom of navigation is restricted, fishing is disallowed at will, and questions are raised on legitimate territorial claims of countries under UN Convention on the Law of the Sea (UNCLOS). Sovereignty claims based on history and the so-called nine-dash line have been judged without any legal basis by the Permanent Court of Arbitration set up by the UNCLOS. Regional institutions like the East Asia Summit, the ASEAN Regional Forum, ADMM + or the ASEAN grouping itself have failed to put up a united front on this issue due to Chinese influence and policy of creating divisions within ASEAN in order to block consensus.

The European Union and the Rise of China China’s 2015 White Paper on military strategy formalized a new maritime strategy encompassing ‘open sea protection’, for which its naval capacity to protect its overseas interests and sea lanes of communication is

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projected to increase. China is contracting additional aircraft carriers, a powerful nuclear-powered fleet of submarines, and has moved to strengthen its air power. China’s energy supplies are vulnerable and it is therefore seeking access to the Bay of Bengal through Myanmar in order to have an alternative supply line through the Malacca Strait. It has moved to set up a base in Djibouti, and Hambantota in Sri Lanka as well as Jiwani in Pakistan are next on the radar. Bangladesh is a potential target in the foreseeable future. However, this can only partially offset China’s Malacca dilemma since the energy volumes to be transported for China will grow further. In future, therefore, the People’s Liberation Army (PLA) Navy is bound to deploy more ships in the Indian Ocean region. The European Union also has a shared interest in not seeing the experience of South China Sea being repeated in the Indian Ocean. The EU and India can cooperate further with ASEAN in the areas of blue economy, coastal surveillance, building of offshore patrol capabilities, hydrographic services and information sharing for increased maritime domain awareness. They can collaborate and invest in the development of desalinization technologies, harvesting the biodiversity of oceans and sustainably mining the ocean depths for marine minerals. The EU and India can work with ASEAN to address threats to their resources including illegal, unreported and unregulated fishing, loss of coastal ecosystems and adverse impacts of pollution, ocean acidification, marine debris and invasive species on the marine environment. EU assistance to ASEAN for surveillance and port security, therefore, needs to be significantly enhanced and accelerated. Given the fact that India is a member of the ADMM + grouping, by virtue of its composition being the same as the EAS, and the fact that one of the aims of the ADMM + grouping is to build capacity in the security field for ASEAN Member States, it would be useful for India and EU to collaborate in the context of activities undertaken under the aegis of this grouping.

India and Maritime Security in Asia India is also increasingly taking the lead to improve regional governance in key areas including socio-economic development, maritime, energy, water, cyber, space and security. India’s various capacity-building efforts in South Asia, the Mekong region and in the island nations of the Indian Ocean contribute to good regional governance. Sustainable development and management have been at the core of India’s cooperation at the

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regional and sub-regional groupings, and this will have implications on regional recourses such as water and energy. Perhaps, India’s role in regional maritime security governance is the most visible and significant in recent years. Not only is India providing new ideas and initiatives in shaping the discourse on regional maritime security, but also its peaceful settlement of maritime boundary dispute with Bangladesh has demonstrated the country’s respect for international norms in sea governance. The initiatives to strengthen a new maritime order in the Indian Ocean region by creating mechanisms both with its immediate neighbours such as Sri Lanka and Maldives and also with other regional and extra-regional players will have long-term implications for the evolving dynamics of the emerging security architecture in the Indo-Pacific region. India’s initiatives have been laying the ground for the emergence of security regionalism in the maritime domain. India is beginning to demonstrate that it has the intent and the capability to maintain a stable regional order at sea. In fact, several analysts argue that India is beginning to take up a leadership role particularly in regional maritime governance (Yhome and Maini 2017). India takes part in the expanded ASEAN maritime forum by virtue of its membership of the East Asia Summit. New Delhi is contributing to regional maritime security by ensuring the safety and security of maritime traffic through the ocean by strengthening skills and logistics of its IndoPacific neighbours, especially those in Southeast Asia. India has also agreed with ASEAN to prevent and manage accidents and incidents at sea and promote effective coordination between ASEAN and India in maritime search and rescue, in accordance with existing processes and practices, including those of the International Civil Aviation Organization and the International Maritime Organization. India has signed white shipping agreements with a number of countries. In addition, Indian ships have undertaken coordinated patrolling and Exclusive Economic Zone surveillance. New Delhi is also helping its maritime neighbours set up their coastal surveillance networks for developing shared maritime Domain Awareness on behalf of its partners. Another element of ensuring safety of navigation in the region has been the hydrographic support provided to India’s partners to chart the waters of the region. This has been augmented by a large training capacitybuilding effort. Recently, Chinese political and economic influence as well as naval presence in the region has continued to grow. Beijing has rapidly moved to occupy, militarize and in some cases populate and reclaim vast

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acreage in the South China Sea. China’s sovereignty claims based on history and its nine-dash line have been judged without any legal foundation by the permanent arbitration tribunal set up by the UN Convention on the Law of the Sea (UNCLOS). India and ASEAN have jointly called for full and effective implementation of the Declaration of the Conduct of the Parties in South China Sea (DOC) and have expressed hope for an early conclusion of the Code of Conduct (COC) in the South China Sea. Thus, a platform for EU-India cooperation in capacity building already exists. The Quad In future, if the Quad comprising of the United States, India, Australia and Japan expands, France is an obvious European candidate since it has territories and military facilities in both the western Indian Ocean and the South Pacific. France, already an important supplier to India and Australia, is expected to step up its defence cooperation with both. India and France signed a logistics support agreement (during the visit of French President Emmanuel Macron in March 2018), which enables India to access French military facilities in the western Indian Ocean. In future, India and EU can also be expected to move closer on issues like maritime domain awareness and logistics. While the Quad has ‘never explicitly referenced China in any of its official statements, the subtext behind this initiative is evident, at least to Beijing’ (Tharoor and Saran 2020: 234). Indian Ocean Naval Symposium (IONS) In 2008, India launched the Indian Ocean Naval Symposium with a view to providing a platform for the littoral nations of the Indian Ocean to cooperate for enhanced regional security. The Symposium is generating a flow of information between naval professionals to develop a common understanding and cooperative solutions in areas of common interests such as humanitarian assistance and disaster relief (HADR), information security, interoperability and maritime security. While assessing India’s role in the emerging maritime governance in the Indian Ocean, the IONS is an important initiative aimed at enhancing naval interoperability, the sharing of information and capacity building. The IONS has also been

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a consultative mechanism in tackling the issue of asymmetric threats and common transnational maritime concerns.

India and SAARC The South Asian Association for Regional Cooperation (SAARC) held the ambitious aspirations of the Indian subcontinent, only to find a clogged disharmony between the countries in this region. India, with its sizeable economy, has made full efforts to contribute to development in its immediate neighbourhood but is yet to overcome the innate political and strategic divergences that overshadow the relations between the South Asian nations. In particular, Pakistan’s intransigence, negativity and support to terrorism have engulfed the region and stalled progress in SAARC. South Asia undoubtedly remains critical for India’s internal stability, while India’s self-interest in its successful functioning cannot be denied. In order to circumvent the challenges posed by the conventional means of regionalism, India initiated the idea of sub-regional approach to unlock the potential of South Asian regional cooperation. This approach allowed New Delhi to circumvent the SAARC mechanism while addressing the much-needed collaboration with those neighbours willing to push for regional integration in South Asia. The South Asia Sub-Regional Economic Cooperation (SASEC) programme in the South Asia Growth Quadrangle (SAGQ) was launched in 2000, with assistance from Asian Development Bank (ADB) with six priority sectors that included transport, energy and power, tourism, environment, trade, investment and private sector cooperation, and information and communication technology (Yhome and Maini 2017: 8). As long as South Asia’s integration remains underdeveloped due to contradictions within SAARC Member States, and there is not much progress in close economic integration, greater EU-South Asian integration strategy will be difficult.

The European Union and SAARC Together with China, Japan, South Korea and the United States, the EU attended the SAARC Summit as an observer for first time in New Delhi in 2007. From the perspective of the European Union, a functional SAARC can be a beneficiary of financial and technical assistance in the fields

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of environment, strengthening regional institutions, regional communications, particularly with regard to standards, networks and services, including telecommunications, research, training, rural development and food security and cooperation in the sphere of energy. However, the new priorities of the EU will relate to economic cooperation, human dimensions of development, the promotion of human rights and the environment. In the absence of cooperation among SAARC Member States, the EU has also resorted to bilateral programmes, the largest of which are in India. The European Investment Bank and the European Development Fund finances are available to projects originating in the EU. In the field of science and technology, apart from joint research projects, specific areas of cooperation include digital information and optical communications, software, applications of biotechnology to agriculture, genetic engineering to medicine and environmental control, superconductivity, micro-electronics and new sources of energy and space technology.

Other Asian Regional Organizations India became a founding member of the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) involving South and Southeast Asian nations (Bangladesh, India, Myanmar, Sri Lanka and Thailand). BIMSTEC’s key objective was to initiate cooperation among the littorals of the Bay of Bengal with particular focus on commerce, investment, technology, tourism, human resource development, agriculture, fisheries, transport and communication, textiles and leather (Yhome and Maini 2017). The BBIN has been yet another logical upshot of India’s sub-regional approach in its foreign policy. By the turn of the century, India further pushed its eastward drive when it set up another sub-regional grouping with the mainland Southeast Asian nations. In 2000, India along with five of the Mekong nations (Thailand, Myanmar, Cambodia, Laos and Vietnam) established the Mekong Ganga Cooperation (MGC). The MGC emphasizes cooperation in the field of tourism, culture, education and transportation linkages. The Mekong–India Economic Corridor (MIEC) links the 4 Mekong countries (Myanmar, Thailand, Cambodia and Vietnam) with India and connects Ho Chi Minh City in Vietnam with Dawei Port in Myanmar via Bangkok, Thailand and Phnom Penh, Cambodia and further linking Dawei to India’s Chennai port. India played a leading role in launching the Indian Ocean Rim Association

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(IORA) in 1997 along with South Africa and some others. IORA’s main objectives were to promote sustainable growth and balanced development; economic cooperation for shared and mutual benefits and remove impediments and lower barriers towards a freer and enhanced flow of goods, services, investment and technology among the Member States (Maini and Yhome 2017). This created a platform for the littoral states in the Indian Ocean to come together on issues like traditional and nontraditional security challenges, including piracy, illegal fishing, human trafficking, drug smuggling, trafficking of weapons, maritime pollution, disaster management and climate change (Sibal 2018). Many Southeast Asian nations are included in this grouping where Indian and European interests converge. India, like the European Union, is also an active participant in regional security organizations like RECAAP. Given a dysfunctional SAARC, India and EU can in future cooperate in development projects within the BIMSTEC and BBIN groupings.

Conclusion India is ‘part of as many of the alphabet soup of groupings as it possibly can be’ from the SAARC and the East Asia Summit (Tharoor and Saran 2020: 280). The current international order, as Tharoor and Saran argue, has ‘significantly helped India’s economic growth while meeting its trade, energy, and security interests. As a result, India now has a stake in practically every major multilateral regime, and its own self-interest can no longer be seen as isolated from the state of affairs around the world’ (Tharoor and Saran 2020: 273). India has a clear advantage of its geographical proximity to Asian multilateral organizations and institutions. The full impact of its policies towards Asian multilateral organizations, however, needs to be realized on the ground. The European Union has been able to deliver and drive the goals set by its Member States, especially in trade and investments. Although India is yet to win the battle with final delivery on connectivity, it has now emerged as a strong partner of the region in defence, maritime domain awareness and increasingly, trade and investments. Similar to the EU, India can use its growing economic prowess to lead by an example to its neighbours in Asian multilateral organizations. Moreover, India enjoys strong cultural and diplomatic ties, and these exchanges can hasten the development of the ties with these regional organizations.

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The geographical proximity of India in Asia and its membership of organizations where the role of the European Union is not developed means that there is immense scope for the two to work together on common projects in keeping with interests and policies. India can, therefore, be a stepping stone for the EU in this regard. New Delhi is gaining ground over the European Union as a stabilizing country, a provider of beneficial programmes, and as a strong partner for the Asian neighbours, even as the EU recedes in influence due to internal developments and the rise of China. A key dimension of the work done by Asian multilateral organizations is related to connectivity. China’s BRI policies in the region, as is the case in many places elsewhere, are sometimes based on opaque and predatory deals. They have supported dubious leaders, put states in financial debt due to unsustainable projects and have often resulted in Chinese control over critical assets and infrastructure of the host state. Indian flagship projects like the Trilateral Highway and the Kaladan Multimodal Project can be supplemented in ASEAN countries with initiatives of the EU. To provide an alternative to the BRI, Japan has doubled the $110 billion fund it created in 2015 for a five-year period to $200 billion that would be offered for the same period. Japan’s concessionary Yen loans have also been doubled to ¥1 trillion since 2015. With the help of the Japan International Cooperation Agency, the Asian Development Bank has created Leading Asia’s Private Sector Infrastructure Fund (LEAP) in 2016 in order to leverage and complement money lent to non-governmental projects. Tokyo has been playing a significant role by itself or through ADB in some connectivity projects like the East–West Economic Corridor. Initiatives like the BUILD (Better Utilization of Investment Leading to Development) Act and ARIA (Asia Reassurance Initiative Act) passed by the United States can also provide a shot in the arm for connectivity and infrastructure projects in the region. The BUILD Act will provide $60 billion in funding for the US International Development Finance Corporation. The ARIA Act will utilize an appropriation of $1.5 billion a year up to the next five years for a range of activities in East and Southeast Asia. The Act envisages developing a diplomatic strategy that includes working with the American allies and partners to conduct maritime training and freedom of navigation operations in the Indo-Pacific region in response to Chinese activities.

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In November 2018, Australia committed itself to deliver a $2 billion infrastructure initiative to the Pacific apart from an additional $1 billion in callable capital to the EFIC—Australia’s export financing agency. It will use grant funding, combined with loans to support the development of high priority infrastructure. India has been providing grants to each of the Pacific Island states under the Forum for India Pacific Island Cooperation (FIPIC) grouping. It has been providing $1 million each year to the Pacific Island states for the past many years and helping them out in times of need with disaster relief and small and medium enterprise development. Both India and EU, being observers in the Pacific Islands Forum, can align and work together to implement the Pacific Plan priorities which include fisheries, energy, trade and economic integration, climate change and transport, in addition to communication technology, health, education and good governance. In all these areas, the EU and India can pool their resources. In future, it will therefore be in the interest of EU and India to work together with the Asian regional institutions.

References ASEAN. (2012). Plan of Action to Strengthen the ASEAN-EU Enhanced Partnership (2013–2017). Retrieved June 20, 2020, from https://asean.org/sto rage/images/archive/document/BSB%20Plan%20of%20Action%20to%20Stre ngthen%20the%20ASEAN-EU%20Enhanced%20Partnership%202013-2017. pdf. ASEAN. (2017). ASEAN-EU Plan of Action (2018–2022). Retrieved May 20, 2020, from https://asean.org/storage/2017/08/ASEAN-EU-POA-20182022-Final.pdf. De Groen, W. P., & Hooijmaaijers, B. (2018). European Union-Asia Multilateral Cooperation in Financial Services. In C. Echle et al. (Eds.), Multilateralism in a Changing World Order. Singapore: Konrad Adenauer Foundation. Retrieved June 12, 2020, from https://www.kas.de/c/document_library/ get_file?uuid=f3daf8b4-8354-3f53-7a56-8da3f660e28a&groupId=252038. Dombrovskis, V. (2017, December 1). Vice President’s Opening Keynote at the 2nd Annual EU—Asia Pacific Forum on Financial Regulation. Retrieved from https://audiovisual.ec.europa.eu/en/video/I-147550. European Commission. (1994, 13 July). Press Release. Commission calls for a New Asia Strategy. Retrieved July 14, 2020, from https://ec.europa.eu/com mission/presscorner/detail/en/IP_94_641.

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European Commission. (2001, 4 September). Communication from the Commission, “Europe and Asia: A Strategic Framework for Enhanced Partnerships”. COM(2001)469 final. European Commission. (2015, 18 May). Joint Communication. The EU and ASEAN: A Partnership with a Strategic Purpose. Retrieved June 20, 2020, from https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=JOIN% 3A2015%3A22%3AFIN&%3Bfrom=EN. European Commission. (2018, 19 September). Joint Communication. Connecting Europe and Asia: Building Blocks for an EU Strategy. Retrieved May 22, 2020, from eeas.europa.eu/headquarters/headquarters-homepage_ en/50708/Connecting%20Europe%20and%20Asia:%20Building%20blocks% 20for%20an%20EU%20Strategy. European Commission. (2019, 29 July). Press Release. Financial Services: Commission Sets Out Its Equivalence Policy with Non-EU Countries. Retrieved May 20, 2020, from https://ec.europa.eu/commission/presscorner/detail/ en/IP_19_4309. European Council. (2003, 8 December). European Security Strategy. Retrieved May 20, 2020, from https://data.consilium.europa.eu/doc/document/ST15895-2003-INIT/en/pdf. European Council. (2012, 15 June). Guidelines on the EU’s Foreign and Security Policy in East Asia. Retrieved June 20, 2020, from https://www.eeas.eur opa.eu/archives/docs/asia/docs/guidelines_eu_foreign_sec_pol_east_asia_ en.pdf. European Council. (2015, 22 June). Council Conclusions on EU-ASEAN Relations. Retrieved December 12, 2019, from https://www.consilium.europa. eu/en/press/press-releases/2015/06/22/fac-asean-conclusions/. European External Action Service. (2014, 14 July). EU-Asia Factsheet. Retrieved from https://eeas.europa.eu/archives/docs/factshhets/docs/20140714_fac tsheet_eu-asia_en.pdf. European External Action Service. (2016, 11 May). EU Projects with ASEAN . Retrieved May 22, 2020, from https://eeas.europa.eu/delegations/associ ation-southeast-asian-nations-asean/907/eu-projects-asean_en#:~:text=The% 20EU%20has%20significantly%20increased%20its%20development%20coopera tion%20funds%20for,the%20amount%20for%202007%2D2013. European Parliament. (2017, 3 October). On EU Political Relations with ASEAN . Retrieved June 22, 2020, from https://www.europarl.europa.eu/ doceo/document/TA-8-2017-0367_EN.html. Germany, Foreign Office. (2019, 21 January). The EU and ASEAN— Partners for Joint Action in Europe and Asia. Retrieved June 22, 2020, from https://www.auswaertiges-amt.de/en/aussenpolitik/regionale schwerpunkte/asien/eu-asean-meeting-2019-/2179724.

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India, Ministry of External Affairs. (2019). ASEAN-India Relations. (n.d.). Retrieved May 22, 2020, from https://mea.gov.in/Portal/ForeignRelation/ ASEAN_India_August_2017.pdf. Jaffrelot, C. (2003). India’s Look East Policy: An Asianist Strategy in Perspective. India Affairs, 2(2), 35–68. Maini, T. S., & Yhome, K. (2017). India’s Evolving Approach to Regionalism: SAARC and Beyond: Rising India and Its Global Governance Imperatives. Rising Powers Quarterly, 2(3), 147–165. Mishra, S. (2016). India’s Growing Influence and Ambitions. Retrieved May 22, 2020, from https://www.orofonline.org/research/indias-growing-influenceand-ambition/. Nuttin, X. (2017, 20 April). The Future of EU-ASEAN Relations. Retrieved June 20, 2020, from https://www.europarl.europa.eu/RegData/etudes/STUD/ 2017/578043/EXPO_STU(2017)578043_EN.pdf. Pant, H. V. (2018). The Wider Reach of SCO. Retrieved May 22, 2020, from https://www.orfonline.org/research/the-wider-reach-of-sco/. Parello-Plesner, J. (2010, 29 October). East Asia Summit, Where Is Europe? Retrieved May 12, 2020, from https://www.ecfr.eu/article/commentary_e ast_asia_summit_where_is_europe. Sajjanhar, A. (2018, 4 January). The Indian-ASEAN Partnership at 25. Retrieved June 20, 2020, from https://idsa.in/idsacomments/india-asean-partnershipat-25_asajjanhar_040118. Sibal, K. (2018, 28 May). India’s Maritime and Other Challenges in the Indo-Pacific Region. Retrieved June 22, 2020, from https://www.indian defencereview.com/spotlights/indias-maritime-and-other-challenges-in-theindo-pacific-region/2/. Sikri, R. (2009). India’s “Look East” Policy. Asia-Pacific Review, 16(1), 131– 145. Tharoor, S., & Saran, S. (2020). The New World Disorder and the Indian Imperative. New Delhi: Aleph. Wadhwa, A. (2020). India and South East Asia. In A. Gupta & A. Wadhwa (Eds.), India’s Foreign Policy: Surviving in a Turbulent World (pp. 324–337). New Delhi: Sage. Xuechen, I. C. (2018). The Role of ASEAN’s Identities in Reshaping the ASEAN-EU Relationship. Contemporary Southeast Asia, 40(2), 222–246. Yhome, K., & Maini, T. S. (2017). Regionalism: SAARC and Beyond, ORF Occasional Paper December. New Delhi: Observer Research Foundation. Young, R. (2015). Keeping EU-Asia Reengagement on Track. Carnegie Europe.

CHAPTER 3

India and EU-China Relations: Perceptions and Misperceptions Rajendra K. Jain

China and India are both important for the European Union because of their demography, large domestic markets of a billion plus each, large consumers of energy, and because they are vital for dealing with regional problems and global issues. India was among the first developing countries to establish diplomatic relations with the European Economic Community (EEC) in March 1962. China established diplomatic relations with the EEC in 1985. The European Commission established a Delegation in New Delhi in 1983 and in Beijing in 1988. The EU began to hold annual summits with China in 1998 and with India from 2000. EU and China have so far held 21 summits with the twenty-second scheduled for September 2020. India and the EU, on the other hand, have held fifteen summits. The European Union announced a ‘comprehensive’ strategic partnership with China in 2003; India and EU signed a strategic partnership in 2004. Since then, the Union’s relations with both Asian countries have widened and deepened across a growing number of

R. K. Jain (B) Centre for European Studies, Jawaharlal Nehru University, New Delhi, India © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 R. K. Jain (ed.), India, Europe and Asia, https://doi.org/10.1007/978-981-33-4608-6_3

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sectoral dialogues and dialogue formats, which are significantly more in the case of China than India. Beijing has been and continues to be more central to European interests than New Delhi because of its political clout, its economic potential, the substantially higher economic stakes and trade. In 2019, the European Union’s trade in goods with China was seven times that of trade with India—e560 billion versus e80 billion (Eurostat 2020; European Commission 2020a). In 2018, EU investment in China amounting to e175 billion, was two-and-a-half times that in India (e68 billion) (European Commission 2020a). As a result, there is a variable engagement of the Union towards the two rising Asian powers and a qualitative difference in the attention and focus given by the European Union to China and India. This chapter begins with a discussion of why the EU takes China far more seriously than India and the attitudinal differences in how China and India deal with the European Union. It examines Indian perceptions of Brussels’ differential engagement of the Union’s two Asian strategic partners. It goes on to discuss Indian perceptions of how the Europeans’ mirage of a socializing China has dissipated and highlights Indian business, civil and political elites’ views of China and EU-China relations. It discusses Indian views of increasing Chinese inroads in Central and Eastern Europe through the Belt and Road Initiative (BRI). In conclusion, the chapter examines Indian perceptions of Chinese efforts to establish a China-centric world order and the Indian commentariat’s reflections on EU-China relations in the wake of the COVID-19 pandemic and the India-China standoff at the Line of Actual Control (LAC).

European Integration India has tended to take a comparatively more measured approach than China towards European integration. The European Union, many Indians feel, does not make things easy, given the complexity of its institutions, proliferating regulations and rotating presidency. Decisionmaking in the EU, driven forward by committees and compromises, has been a traditional deterrent in more proactive engagement in Brussels. The Indian elites’ perceptions of the EU continue to be essentially conditioned by the Anglo-Saxon media, which impedes a more nuanced understanding of the processes and dynamics of European integration, as

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well as the intricacies and roles of EU institutions (Jain 2009a: 173; Jain 2019). Europeans tend to perceive China as a greater supporter of European integration than India. Some of them even zealously maintain that the Chinese perhaps understand Europe better than even the Europeans themselves. Beijing, most Europeans maintain, has made greater efforts at understanding EU institutions than New Delhi. The Chinese, according to one European diplomat, seem ‘to have more faith in, and clear understanding of, the notion of Europe as a unified bloc’ than do the Indians, but are also ‘rather dealing with specific member states individually for most practical economic purposes’ (cited in Lisbonne-de Vergeron 2011: 35–36). Over time, China excelled in exploiting intra-European differences to its advantage. Indian leaders ‘treat Europe, especially as a collective group, with disdain’. Beijing, on the other hand, has taken Brussels ‘more seriously’ than New Delhi (Pal Chaudhuri 2011a).

Differential Treatment The European Union has traditionally perceived and dealt differentially with India and China. Indian elites and decision-makers maintain that EU policy-makers have a fixation on China. For long, remarked a veteran Brussels-based Indian observer, the European Union had single-mindedly focused on China since India was economically and politically overshadowed by China (Subhan 2002: 51; Pant 2008; Saran 2017b; Lisbonne-de Vergeron 2011: 38). As Asia started to come together and to see how China’s ‘peaceful rise’ could be kept peaceful for Asia, Brussels seemed to have abandoned its traditional focus on India to have concentrated on Southeast and Northeast Asia (Shashank 2007: 23). There has also been some degree of unhappiness that the EU maintained its Cold War policies of ‘equidistance’ between India and Pakistan until the turn of the millennium. In the 1990s and 2000s, the EU’s policy towards Asia was characterized by a significant element of China first. Brussels had invested significantly more in developing relations with China than with any other Asian state. Whereas the Union respects China as a great power, Brussels, for many Indians, tended to regard India as a regional South Asian power and does not adequately appreciate its rise in the Asia–Pacific. For several decades, Europeans considered India as still ‘an emerging country’ whose status

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is being slowly enhanced. New Delhi’s process of global empowerment was deemed to be in its early stages, whereas China was clearly ahead in terms of GDP, defence capabilities and diplomatic clout (Racine 2007: 53–54). To most Indians, a Sino-centric Europe has been more willing to accommodate China rather than India. Brussels has often urged New Delhi that India should emulate China in its dealings with EU and tried to introduce a competitive spirit—‘You have only yourselves to blame for the lower level of interaction and engagement’ (Jain 2009b: 141). Most stakeholders in India feel that a Sino-centric Europe has been more willing to accommodate China rather than India, which, as Commissioner Peter Mandelson once remarked, ‘is getting there, but not quite arrived’ (cited in Rao 2007). India is perceived to be in the Commonwealth Games league, whereas China is in the Olympic Games league. For Brussels, India’s $3 trillion economy does look modest against China’s $14 trillion economy. For decades, EU policy-makers and think-tankers have argued that China takes the European Union far more seriously than India. In the early 2000s, most people in Brussels generally felt that Indian policymakers appeared to need convincing that the EU is ‘a player that matters’ (Patten 2002a). European Commission President Romano Prodi complained that India was ‘too focused’ on the United States in its foreign and economic policy. This attention ‘came at the expense of the EU’ (cited in Shedde 2001). On many occasions, Europeans urged India to altogether shed its narrow ‘prism of Pakistan’ and foster a more meaningful partnership by developing a wider world view similar to that of China (Patten 2002b). In the early 2000s, within the European Commission, External Affairs Commissioner Chris Patten was behind the decision to give greater priority to India, which was then no longer ‘hyphenated’ with Pakistan, but with China. There is also an attitudinal difference on how China and India deal with the European Union. Europeans have not exactly relished the more vocal approach of a rising India and its confident and articulate elite keen on gaining a position at the ‘high table’. China tends to be generally much more subtle, making rather indirect and allusive statements, rather than brazenly direct pronouncements that India tends to make in the manner of Western foreign offices. In diplomatic discourse and conduct, India has tended ‘to carry many chips on its shoulder, almost always moralistic, needlessly arrogant, argumentative, mistaking such attitude as being an assertion of national pride’ (Singh 2006: 276–277).

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China, many Europeans feel, has over the years developed a far more sophisticated approach towards Europe. Even though EU officials concede that the core of the relationship with both China and India is economic, but China, they insist, functions more like a demandeur, continuously seeking to constantly widen interaction and dialogue.1 People in Brussels have often argued that India has not been proactive or entrepreneurial enough like China to avail of existing opportunities or to make the requisite efforts to understand their working. Whereas Beijing is perceived as having the uncanny ability to implement plans on schedule, ever willing to engage in dialogue at short notice, and to get things moving, India seems to stagger along. This is probably because on most things which matter most to India, the EU is not able or willing to make a difference. As a result, most deliverables are perceived to essentially lie in bilateral relationships (Jain 2009b: 140). The larger EU Member States, which have greater economic stakes, are the main drivers of relations with China and India. It is they who move the wheels within the EU. It is they who provide the vision, the ideas and the expertise. They are the ones who persuade the indifferent or those who have little or peripheral interest in the region to come on board. Over the years, China has become quite adept in being able to divide and rule among EU Member States, which are themselves divided over how to handle China (Grant and Barysch 2008: 22).

Engagement of EU Institutions In its dealings with the European Economic Community/EU, India has traditionally concentrated almost entirely on the European Commission primarily because it was the main interlocutor in dealing with trade irritants. For decades, New Delhi regarded the European Parliament as a mere ‘talking shop’ and confined itself to fire-fighting or damage control (mostly on Kashmir). With growing appreciation of the greater profile and role of the European Parliament in the Union’s institutional architecture since the Lisbon Treaty, the Indian attitude and approach significantly changed. This has been reflected in a number of recent high-profile visits and the establishment of a separate India Delegation (as in the case of China). Whereas Beijing has about half a dozen officials for closely

1 Interview with senior official of the European Council, Brussels, 24 November 2006.

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following the work of the European Parliament, India, especially since the substantial increase in its powers since the Lisbon Treaty, has two officials in its Mission to the European Union. There are about two dozen Chinese officials dealing with political affairs, whereas India has just a few. The European Parliament established the Delegation for Relations with the People’s Republic of China in 1979. The establishment of a separate Delegation for India—separate from the Delegation for Relations with the countries of South Asia and SAARC (South Asian Association for Regional Cooperation)—had been a prestige issue for India since the launch of the India-EU strategic partnership and seems to have been driven by a competitive desire for a status similar to that of China. The idea was constantly pushed by the Indian Embassy in Brussels, but continued to be resisted in Brussels. Eventually, President of the European Parliament Josep Borrell finally agreed to it during his visit to India in October 2006 (six weeks before his term was coming to an end).2 The EP Delegation for India was established in 2007. Since July 2019, the EP Delegation for China consists of 37 members, whereas the one for India comprises 23 MEPs (Epthinktank.eu). China has generally taken full advantage of the European Union’s institutional mechanisms and dialogue formats ‘to promote its geopolitical goals and also to neutralize European concerns about democracy and human rights’ (Sachdeva 2014: 427).

Strategic Partnership Perhaps in no other strategic partnership has Brussels invested so much political and diplomatic time and energy as well as financial resources as the one with China. Since the mid-1990s, the European Union has come out with seven strategy papers3 —the first five after every two or

2 Conversation with a former Chair of SAARC Delegation in the European Parliament, Brussels, 23 November 2006. 3 A Long-term Policy for Europe-China Relations, 12 October 1995; Building a Comprehensive Partnership with China, 25 March 1998; EU Strategy towards China: Implementation of the 1998 Communication and Future Steps for a more Effective EU Policy (May 2001); A Maturing Partnership—Shared Interest and Challenges in EUChina Relations (September 2003); EU-China: Closer Partners, Growing Responsibilities, 24 October 2006; Elements for a New Strategy on China (22 June 2016); EU-China—A Strategic Outlook (12 March 2019).

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three years—whereas there have been only three in the case of India.4 In response, Beijing published three policy papers in 2003, 2014 and 20185 and India one in response to the European Commission’s 2004 Communication on the strategic partnership.6 To a very large extent, the size of the economic stake tends to define the degree of political interest that the EU and its Member States take in certain countries. As a permanent member of the UN Security Council, China has all the advantages of ‘great power exceptionalism’ (Ikenberry 2008: 32) which India does not. Because of its membership of the UN Security Council, it was natural that Brussels’ interaction with Beijing has been much more significant in the resolution of key problems, especially as China by 2007 had become the largest trading partner of Iran, North Korea and Sudan, and the second largest of Burma and Zimbabwe. At summits and other dialogues, the Chinese are said to follow a structured approach with usually several rows of participants followed by note-takers, whereas EU officials say they confront a random democracy on the other side. Despite about 40-odd issues, on which there are dialogue and consultations with India under the strategic partnership, Brussels feels that it does encounter the problem of capacity and resources in the Ministry of External Affairs. EU officials are fond of saying that India does not devote adequate human resources commensurate with the need to simultaneously engage the Union across a broad range of issues. Brussels finds India wanting in terms of devoting the requisite time and effort in creating, building and negotiating appropriate institutional mechanisms to simultaneously discuss a variety of issues. In this context, they are fond of stating that China has a separate embassy accredited to Belgium and a separate 60-member one to the EU. India, on the other hand, has a combined one of about one-third its size for Belgium, Luxembourg and the European Union. There are more numerous and deeper institutional links between the EU and China than between India and the Union. EU institutions have greater concentration of personnel, staff and interest in forging closer ties 4 EU-India Enhanced Partnership, 26 June 1996; An EU-India Strategic Partnership, June 2004; Elements for a New Strategy on India, 22 November 2018. 5 China’s EU Policy Paper (13 October 2003); Deepen the China-EU Comprehensive Strategic Partnership for Mutual Benefit and Win–Win Cooperation, 2 April 2014; 18 December 2018. 6 Indian Response to EU Communication on a Strategic Partnership, August 2004.

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with China than with India. New Delhi’s interaction and institutional engagement with the EU is less intense, and dense in terms of visits, dialogues and consultations, than that of the Union with China.7

Similarities in Chinese and Indian Approaches There are basic differences in both perceptions and interests of China and India with the EU in many fields, including trade, development, globalization and WTO negotiations, the International Criminal Court, climate change, etc., where the EU has taken a stand contradictory to them. China and India argue that the structures of global governance must be more democratic, representative and legitimate. Both China and India have similar attitudes towards the role of the United Nations and multilateralism. Both Asian giants resent European efforts to talk down to them from the high pedestal of post-modernism. They remain acutely sensitive about their sovereignty and internal autonomy against intrusive human rights issues and remain wary about humanitarian intervention and the circumstances in which force may be used. Both feel that hard power is as necessary as post-modernist Europe’s fascination for and advocacy of the merits of ‘soft power’. Above all, both China and India are unanimous that the European Commission often tends to assume a patronizing attitude—‘Engage and we shall teach you’ (Jain 2009b: 146). As the two most populous economies, China and India have in the past had consultations and policy coordination in multilateral trade negotiations and climate change. Senior EU officials have generally expressed a preference for and likeableness of China’s low profile and its general caution about assuming a leadership role inside the WTO in sharp contrast to the higher profile that India tends to occupy in multilateral trade negotiations. The greatest challenge, Trade Commissioner Mandelson remarked, is to have ‘a Chinese negotiator to start talking and an Indian negotiator to stop talking’ (cited in Dutt 2007). 7 For instance, officials from the European Commission responsible for initiating and implementing the EU’s China policy made 206 trips to China in 2004, on average four visits per week (cited in Subhan 2005). Between 2002 and 2004, there were twelve visits to India by EU Commissioners and the High Representative for CFSP Javier Solana, whereas there were nine Commissioner visits to China alone in the first half of 2004. However, in recent years with India and EU talking across the board, the number of visits of Commissioners and officials has increased, but it still does not equal those to China.

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No Brownie Points for Democratic India Many stakeholders in India feel that there is a degree of discrimination in the European Union’s interest in and treatment of democratic India and autocratic China, with which the Union has few common political values (Jain 2006: 89–90). Thus, many in India feel that the EU has been less sympathetic to and supportive of ‘a democratic secular India, one of the few countries to practice democracy in the developing countries against overwhelming odds’ (Ram 2002: 5). India’s democratic polity and shared values do not necessarily earn it any brownie points in Europe. India’s relationship with the EU is not likely to be at the same level as China even though it did not have the problems encountered in the relationship with China such as human rights, the arms embargo, etc. One should not read too much into Jean-Claude Juncker’s characterization of India and the EU as ‘natural partners’ on 6 October 2017; it only signifies that the two share similar political systems and values. In reality, however, India has not obtained ‘any significant dividend from such convergence in terms of Europe’s (or America’s) hard policies’ (Sibal 2019: 61–62). Discomfort with India’s policy of non-alignment and lack of an attractive and not a very open market have, in fact, conditioned European policies and attitudes towards India rather than shared values.

The Mirage of Socializing China The European Union and the West, a number of Indian analysts have argued, entertained somewhat naïve notions that greater engagement with China would eventually lead to the emergence of a more liberal China. During 1994 and 2008, Brussels had reached ‘the high point of pan-European optimism’ in the belief that the EU ‘could serve, and would be accepted, as a model for an emerging China’ (Pal Chaudhuri 2015: 4). The Europeans believed that enmeshing China into a network of international obligations and exposing it to ‘the European way of doing things, would make China easier to “manage” and make it less likely to be a revisionist power’ (Pal Chaudhuri 2015: 5). The West entertained ‘the romantic notion that as China develops economically and becomes more prosperous, the political aspirations of its growing middle class will make it more democratic and the country will become more wedded to the existing world order’ (Sibal 2017a). ‘The Great Yellow Hope of Europe’

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in 2009 had been China, speeding its way through its industrial revolution, it was argued, would become ‘a responsible global power in an equally rapid fashion’ (Pal Chaudhuri 2010). Constructive engagement is a manifestation of EU’s civilian power strategy, with an emphasis on the value of non-military, inductive and soft power in shaping China’s domestic system and its relations with the rest of the world. EU hopes that those institutional webs it encouraged China to participate multilaterally and bilaterally will in the end transform China into a more liberal economy, and more democratic society based on the rule of law, and become a responsible player in Asia and beyond (Pal Chaudhuri 2011b). India was not unduly impressed by the EU model and its ‘heroic but doomed attempt to “teach” China how to become a liberal responsible power in the decade running up to 2009’ (Pal Chaudhuri 2011c). This was ‘at best a mirage. Europe was taken for a ride by China’. In hindsight, it was, in fact, ‘hubris on the scale of the Tower of Babel’ (Pal Chaudhuri 2015: 5). Thus, Indian perceptions of Brussels’ engagement of China was similar to those of seasoned China-watchers who maintained that EU’s China strategy was based on ‘an anachronistic belief that China, under the influence of EU engagement, will liberalise its economy, improve the rule of law and democratise its politics’ (Fox and Godement 2009: 1). The West, a former Foreign Secretary argued, was disappointed that its assumption that ‘as China reformed and opened up to the world, globalization and free markets would remake China in the West’s image— capitalist and ultimately democratic’ (Menon 2015). Initially, things seemed to go according to plan until China’s accession to the World Trade Organization in December 2001 and ‘socialism with Chinese characteristics’. However, past experience, especially after the 2008 financial crisis, suggested that ‘Chinese capitalism is qualitatively and quantitatively different from that in the West, with a real prospect of long-term success on its own terms. It also suggests that in an increasingly authoritarian China, single party rule may be lasting. It is now clear that China’s polity is unlikely to converge with Western models’ (Menon 2015). In recent years, the phase of Europe’s intense engagement with China is giving way to ‘a perception of strategic competition. There is anxiety over China’s predatory investment in European strategic assets such as ports and logistic hubs’ (Saran 2020a).

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China’s Growing Political and Economic Links China’s growing political and economic links with the European Union. Firstly, much of Beijing’s overseas investments in high-technology chains, corporate and business know-how, and brand value has been in Europe. Total Chinese FDI in the EU-28 from 2000 to 2016 was e101.1 billion. Moreover, as it steadily moves up the value chain, China regards Europe as ‘the only real market’ for high-end goods (Saran and Deo 2019: 48). China’s ‘Made in China 2025’—the blueprint for making key Chinese industries global champions of the future—has alarmed the United States, Europe and Japan; they are working together to restrict Chinese access to their most advanced technologies since their absorption by the Chinese has enabled them to rapidly move up the supply chain with more value-added processes (Saran 2019a). As a result, there is ‘an on-going “decoupling” between China and the West taking place in higher-end technological segments’ (Saran 2020b). China has acquired control of 10% of European ports as a means to create new trade routes into Europe and to gain influence in European states that are at the periphery of the EU (Saran and Deo 2019: 48). China seeks ‘to diminish the role of the EU as a global actor’ even as it engages Member States to advance its interests. With an economically beleaguered EU unable to provide infrastructure investments on a large scale in Central and Eastern Europe—the 16 + 1 (now 17 + 1 after Greece joined in 2019)—China has ‘stepped into this void to emerge as a European actor’ (Saran and Deo 2019: 48). This has had two consequences. Firstly, with its financial resources and large market, China has proven to be a ‘tempting partner’ and Europe, especially the United Kingdom, which accounts for nearly a quarter of Chinese FDI in the EU, has allowed ‘economic compulsions to override any political scruples’ (Saran 2015). In the process, China seeks to create a distance between the United States and Europe. Secondly, these investments and the dependencies it fosters have enabled China to gain political concessions by its pursuit of a policy of divide and rule. Greece, Hungary and Croatia—the former two having received significant Chinese investment in recent years—opposed language in the July 2016 EU statement on the UNCLOS tribunal’s decision (which found China’s expansive territorial claims in the South China Sea to be illegal) that would have ‘supported’ or ‘welcomed’ the tribunal’s decision (Cottey 2019: 485). For instance, in June 2016,

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Greece prevented the EU from criticizing China’s human rights record at the United Nations some months after China’s COSCO Shipping took over the Greek port of Piraeus. In March 2017, Hungary derailed the EU’s consensus by refusing to sign a joint letter denouncing the reported torture of detained lawyers in China. In June 2017, Greece blocked an annual EU statement on human rights in China—the first time the EU failed to make a joint statement at the United Nations. Again several EU Member States including Greece and Czechia/the Czech Republic had watered down the language of the European Council’s statement announcing a planned EU investment screening mechanism which was sought to be implemented sometime during 2018. The undermining of EU unity is somewhat discomfiting since Chinese investments have only been partially materialized. Illiberal governments in Central Europe reverberate Chinese political positions as a means to attract investments and as a source of some leverage against European governments accusing them of illiberalism. Thus, Beijing perceives the EU as ‘inimical to its political and economic interests in the region and has acted strategically to mitigate the bloc’s influence’ (Saran and Deo 2019: 48–49). As a result, Europe is struggling to define ‘the terms of its engagement with China, both individually and collectively’ (Saran and Deo 2019: 147). The West, argued a former Foreign Secretary, has manoeuvred itself into ‘a weak position vis-a-vis China by fuelling its economic rise and forging deep trade and financial links with it that now inhibit any really strong response to Chinese muscle-flexing’ (Sibal 2017a). Beijing’s Trojan horse tactics have enabled it to pursue a transactional relationship with weak and indebted countries like Greece.

Multipolarity Beijing views the European Union as a pole in an emerging multipolar world and as a potential counterbalance to the United States. To that end, it has been keen that Europeans develop a more united voice. India too regards Europe as ‘a key pole in the evolving multi-polar international system’ (India, Ministry of External Affairs 2007: vii–viii, 79, 94–96, 160) and viewed India and Europe as ‘indispensable poles in the emerging multipolar structures’ (India, Ministry of External Affairs 2009: ii, x, 79, 91–92). For many years, Indians felt that it was going to be ‘a long, long way’ before Europe is going to act as a pole, largely because of the inherent constraints of the Common Foreign and Security Policy

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in a heterogeneous EU. Indian analysts as well as upper and decisionmaking classes do not see the EU as a counterweight to the United States, but as ‘a building process and a construct’ that could be able to deliver long-term gains for the Indian subcontinent, while maintaining intact the diverse range of Indian bilateral relations with specific European countries (Ruet et al. 2004: 105–106). The EU, according to Indian stakeholders, displays a lack of geopolitical coherence and has not yet shown signs of acting as a credible power (Lisbonne-de Vergeron 2006: 5). While Europeans aspire for a multipolar world, they apparently went along with Chinese views of a unipolar Asia, and not a multipolar Asia which also takes into account the growing profile of India and Japan in the region. The romantic notion that Asia is a ‘naturally’ Sinocentric continent, Indian observers argued, should be discarded (Sahni 2008: 37). India regarded the EU’s continued growth and prosperity as important for India’s own development and the evolution of an inclusive, multipolar world (Singh 2016). However, it was only in November 2018 that the European Union’s Strategy 3.0—‘Elements for An EU Strategy on India’—acknowledged that it had an interest in India playing a greater role in a multipolar world, which ‘requires a multipolar Asia’ (EEAS 2018: para 2.3). India is keen that a strong European Union plays a larger and more active role in Asia and works towards a more equitable, stable balance of power in Asia. New Delhi too is determined to continue to play the role of an indispensable element in the Asian balance of power.

Potential Threats China is perceived by most Europeans as a direct and immediate threat to European jobs, since it is with China that the Union has the largest bilateral trade deficit. The EU’s trade deficit with China was rising by e15 million an hour and reached e170 billion in 2007. In 2019, the Union’s trade deficit with China stood at e164 billion (Eurostat 2020). In recent years, many Europeans fear ‘a threat to their economic interests’ by the rise of China and India. India is perceived by Europeans as a latent and potential threat taking away service-sector jobs, though pressures will increase as both China and India move up the value chain. Foreign Secretary Shyam Saran, however, stressed that the tendency to equate India with China as a threat to European employment structures was unwarranted. Outsourcing and low-cost service industries, he added,

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should not be looked up with suspicion. Equating India with China was ‘fine as long as it is not seen as a threat to its employment structures’. However, it was ‘unfair’ because the EU’s trade with China is 12% of its total, as compared to two per cent with India (Saran 2005: 4). Some Europeans concede that there is no empirical basis for this, but there is an unsubstantiated fear of a rapidly growing Indian economy having the potential of posing a danger at some time in future.

Security Implications of a Rising China Indian policy-makers feel that Europe essentially views China through an economic prism and as an economic opportunity. It does not seem to be overly concerned about the potential security implications of a rising and more assertive China, about its military modernization and rising defence expenditure. Most Europeans, Chris Patten once argued, tended to feel that they should convince Washington that China should not be regarded as ‘a strategic threat, but a crucial partner’ (Patten 2005: 278). This is partly because Asian issues and nations are too distant for Europeans to directly impinge on their own security, partly because the EU is not militarily present in East Asia, and unlike the United States, does not play the role of an external balancer in Asia (Jain 2014: 15). Most Europeans tend to see China as an economic threat, while India’s rise is seen as a benign and stabilizing development around the world. Perhaps the Europeans have begun to appreciate what Lee Kuan Yew used to say that India’s rise does not generate the same anxieties which China does precisely because India is an open, transparent and democratic country (cited in Saran 2017a). India is broadly seen as non-threatening, unlike China which has to work hard to earn that image (Pal Chaudhuri 2012). The spectacular rise of an authoritarian China raises concerns, whereas ‘a rising India’s democratic credentials gives comfort to the West’ since its rise is not seen as threatening Western interests (Sibal 2018).

Indian Elites and EU-China Relations According to semi-structured face-to-face interviews of 38 Indian stakeholders during the period 1 January–20 June 2010 in New Delhi, business elites maintained that the European Union was a better economic partner than China (Jain and Pandey 2012: 337). Business elites also felt that China’s exchange rate and burgeoning trade surplus as a cause of

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common concern for both the European Union and India (Jain 2012: 35). The European Union was criticized by Indian elites of being extremely ‘selective’ in its normative prescriptions. When it came to China, a political columnist felt that Brussels seemed to have ‘a different rule-book’.8 The Union, argued a media elite working in a leading national daily, that the European Union was ‘very poor in explaining the context... that human rights, humanitarian intervention are by-products of that postsovereign concept... therefore it comes out as being essentially moralistic, interfering... particularly against countries like India and China which are more similar to nineteenth century European powers and much more sovereignty conscious’ (Hindustan Times, media elite, interview, 27 January 2012, cited in Jain and Pandey 2013: 116). A civil society elite felt that the EU should apply norms regarding human rights uniformly and urged the EU to convey this in ‘a better and more effective way’.9 Another civil society elite felt that when talking about human rights with China, the EU tended to tweak it ‘in a way that it’s called rule of law not human rights’ (Kumari 2015). During another round of interviews conducted in the summer of 2015, Indian elites expressed diverse perceptions of EU-China relations. One former diplomat and ambassador to a European country wondered whether the arms embargo instituted after the Tiananmen Square incident was continuing de jure but wondered whether de facto, it was continuing or not. China obviously had ‘a much greater presence and influence in EU policy-making than India’. This was, he felt, ‘somewhat unfortunate’ because India was much closer to the EU in terms of value systems than China (Sajjanhar 2015). It was natural, a former Ambassador to the European Union felt, for the EU to have a larger trade and investment relationship with China because the Chinese economy was many times bigger than that of India. India too, he said, could also have a closer relationship with the Union. This was, he maintained, not such a ‘huge issue because the EU, by definition [and] EU countries [Member States] will be more comfortable with liberal democracies like us rather than [a] one party dictatorship like

8 Political columnist, Media Elite, New Delhi, 16 March 2012. 9 Interview with Kumar Sundaram, 26 June 2015.

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China’.10 This was echoed by a civil society elite and specialist on European affairs, who also felt that it was easier for the EU to deal with India because it is a democracy.11 Unlike several decades ago, a think-tanker argued, EU-China political differences had disappeared since EU Member States were eagerly joining the Asian Infrastructure Investment Bank (AIIB). This, he said, highlighted the ‘pragmatism’ in the European approach towards China. ‘Of course, democracy matters, but only in normative terms but not in practical terms’ (Upadhyaya 2015). That a number of European countries joined the AIIB despite American opposition reflected the depth of realpolitik among the Western middle powers (Raja Mohan 2015). Another veteran think-tanker maintained that India was ‘comfortable’ with the level of EU-China relations at the moment in terms of the arms embargo and the arms trade at the strategic level. At the same time, there was, he felt, a little bit of unease in New Delhi that China ‘may be able to buy its way into the European Union just because it has so much capacity and funding abilities’. India and the Union, he suggested, should have a conversation on what each of them thought about China’s thinking (Sidhu 2015).

Image of China and India in Europe The coverage of China in the European media is much more substantial than that given to India. While Indian cuisine, films and music have gained in popularity, unlike China, India hardly finds more than ‘an occasional reference’ in the news (Muenchow-Pohl 2012: 34–35). In the media, elite interviews as well as public opinion, there was an overwhelming predominance of China at the expense of other Asian countries (Bersick et al. 2012: 150, 273). The image of China in Europe, a former Foreign Secretary remarked, in many respects is not particularly good. There is ‘full awareness of the scope of China’s ambitions and the eventual threat China will present to Europe’s interests as a powerful competitor, but that does not stop it and the rest of the world from wooing China for economic benefits in the short-term’. On the other hand, India’s overall

10 Conversation with a former Indian Ambassador to the EU, New Delhi, 24 June 2015. 11 Interview, civil society elite, New Delhi, 27 June 2015.

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image, positive or negative, is not ‘that material in shaping Europe’s policies towards India. These will be shaped in the light of Europe’s understanding of its own interests’ (Sibal 2019: 74).

The BRI and Chinese Roads in Central Europe Most of the discussion in India on the Belt and Road Initiative has been on its impact on South Asia, especially the China–Pakistan Economic Corridor (CPEC) as well as the implications of the Maritime Silk Road. There has been no official comment or any significant commentary in the press about the Chinese inroads into Central and Eastern Europe and the ‘16 + 1’ format established in 2012 to enhance cooperation between Beijing and eleven EU Member States and five Balkan countries. The ‘16 + 1’ summit held in Budapest in December 2017 went ‘entirely unreported’ in India. India’s scant interest in this new forum underlined the problem it has in dealing with changing Eurasia (Raja Mohan 2017a). The Indian commentariat regards the BRI as ‘the vehicle of China’s geopolitical expansion’ (Sibal 2019: 64). For Europe, which had been fairly indulgent to China’s growing presence, the growth of ‘an aggressive and expansionist China with massive ambitions of connectivity, trade and acquisitions’ in Asia and Europe, the BRI was ‘a wake-up call’ which jolted the European Union ‘out of its complacency’. It had unforeseen impact in many European countries, which began to realize that the BRI ended at their doorstep, making them vulnerable to Chinese ambitions (Bagchi 2018). In Central and Eastern Europe, it encouraged leaders like Viktor Orban of Hungary to steer away from old Europe to welcome China into the continent. China seeks ‘strong entry points’ through East European countries and the Balkans—the ‘soft underbelly’ of Europe. The Chinese economic penetration led major EU countries ‘to rethink about Chinese expansion in Europe and the price Europe will pay for this eventually’ (Sibal 2019: 75). Europe has begun to worry about the unveiling of Chinese political ambitions through the BRI (Sibal 2019: 62–63). From being the sole critic of BRI initially, more and more countries, including those from Europe, subsequently echoed New Delhi’s concerns about the consequences of China’s predatory economics. At the Belt and Road Forum, which was held in Beijing in 2016, Europe was represented, but the Europeans did not sign the final document because of rising concerns about China’s policies, the lack of reciprocity

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in terms of market access, China’s inroads into the Balkans, which is taking away a share of the business of European companies in Europe itself in certain sectors like railways and ports (Sibal 2019: 63). Similar concerns about the BRI led both India and the EU to adopt a common position on connectivity. Connectivity issues, they agreed, must be based on ‘universally recognised international norms, good governance, rule of law, openness, transparency, and equality and must follow principles of financial responsibility, accountable debt-financing practices, balanced ecological and environmental protection, preservation standards, and social sustainability’ (European Commission 2017: para. 22). With Central and European countries welcoming BRI funding without any inhibitions, Beijing has been ‘slowly chipping away at Europe’s periphery’ and has ‘effectively sidelined’ the European Union (Saran and Deo 2019: xiii, 80). Czech President Milos Zeman even regarded his country an ‘unsinkable aircraft carrier for China in Europe’ (New York Times, 12 August 2018, cited in Saran and Deo 2019: 80). Thus, China’s courting of the 17 + 1 (after Greece joined in April 2019) has become ‘a matter of concern’ for Europe (Saran, 2020a) as it has eroded the EU’s influence over its eastern periphery. Chinese inroads, however, have not been able to lessen the European Union’s economic heft in Central Europe, but by exporting infrastructure investments and creating new political groupings, China has been able to ‘undermine the Western hubris’ in the region. It widens ‘the strategic options for Central European states. Fed up with bullying from both Brussels and Moscow, the Central Europeans are happy to play ball with China’ (Raja Mohan 2017b).

A China-Centric World Order? The post-war liberal international order is in crisis. The Western assumption that China would be one such alternate stakeholder in the existing international order has proven to be misplaced. Instead, China is offering ‘an alternative world order altogether’ (Tharoor and Saran 2020: xvii). China has emerged as ‘the most prominent normative challenger’ of the existing international order. The ‘strongest disruption to Westphalian sovereignty’, in fact, is the rise of ‘a strong China, fuelled by economic prowess, military might, and a renewed eagerness in the application of its hard power’ (Tharoor and Saran 2020: 192, 250). From the norms, rules and institutions of economic relations and collective security, China is

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offering ‘a new vision’ for the global world order characterized by market authoritarianism and illiberal values (Tharoor and Saran 2020: 251). The BRI is seen by many in India as an important instrument in building the Chinese narrative of the inevitability of a Chinese hegemonic order, supplanting the US-led order (Saran 2017a). Brexit, which undermined the influence and strength of Europe as a whole, insofar as it weakened the West-centred international order, helped China increase its international clout (Pal Chaudhuri 2020b: 89). The mantra of the Washington Consensus—free markets, which ensured economic prosperity and fostered liberal democracy—collapsed with the onset of the 2008 economic crisis, thereby discrediting both capitalism and liberal democracy. This has apparently enabled China to promote the so-called Beijing Consensus, which combines political authoritarianism with state capitalism. Thus, the values that India and the European Union share become important in the context of ‘an alternative authoritarian and state-controlled model that President Xi Jinping is propagating today’ (Sibal 2019: 77). But the question is, can India and the EU strengthen a value-based counternarrative to China?

Two Different Models The rise of India and China offers two developmental models to the world: in China, development has been spearheaded by a ‘nondemocracy’ or one-party state relying on policies associated with ‘managed’ economies, whereas economic growth in India has been effected in an open and democratic regime with a free market economy. Despite the imperfections of Indian democracy, it has worked, even though more than a decade of coalition governance. Many countries, particularly in Africa, welcome Chinese support as an alternative to the Western pattern of interference in their development. China’s spectacular growth is proof to many developing countries that reform and economic opening need not necessarily lead to democracy. In fact, for many developing countries, China’s phenomenal economic success has undermined the belief that the Washington Consensus is ‘the only pathway to prosperity for the world, and inspired a new wave of autocratic rulers to emulate its success’ (Tharoor and Saran 2020: 202–203). The Chinese model had ‘a seductive appeal in a world where familiar anchors, ideological and political’ had been shaken and reinforced the ‘predatory power of the State’ (Saran 2019b). The Chinese have begun to believe that they have ‘an alternative model

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of development as well as an alternative political system to offer to the rest of the world, especially the developing countries’ (Sibal 2019: 62). There were no serious takers for the idea of ‘Chindia’ (Ramesh 2006). The European sovereign debt crisis accentuated a Chinese sense that the EU, far from representing ‘a superior political and economic system, was at best an equal to the Chinese model’ (Pal Chaudhuri 2015: 7).

COVID-19 and the India-China Standoff at LAC The fifteenth India-EU summit was held on 15 July 2020 amidst the tension between India and China along the Line of Control, the increasing assertiveness and aggressiveness of China, and weeks after the twenty-second EU-China summit (22 June). Both these summits were held by video conference owing to the COVID-19 pandemic. This provided an interesting background for reflections on EU-China relations by the Indian commentariat. Europe and China, a former Foreign Secretary argued, have been ‘major partners for a generation’ so much so that according to the Global Office of the International Comparison Program at the World Bank, China and the EU now account for nearly 35% of global GDP in PPP terms. Between 1995 and 2012, Germany—Europe’s economic powerhouse—had ‘enhanced its industrial value by 37%, the largest chunk of which came from supply chains not in the United States but in China’ (Gokhale 2020). The Union’s Joint Communication on ‘A Strategic Outlook’ (12 March 2019), which described China as ‘a cooperation partner with whom the EU has closely aligned objectives, a negotiating partner with whom the EU needs to find a balance of interests, an economic competitor in the pursuit of technological leadership, and a systemic rival12 promoting alternative models of governance’ (European Commission 2019: 1), was stated to be the ‘product of a long process 12 Elaborating on what ‘systemic rival’ meant, Borrell wondered whether ‘systemic’ rivalry was rivalry between systems or ‘a systematic rivalry’. He acknowledged that while China had ‘a global ambition’, but he did not believe that China was playing ‘a role that can threaten world peace’. The Chinese sought to play ‘a global role, but they do not have military ambitions and they do not want to use force and participate in military conflicts’. Brussels and Beijing had ‘differences on interests and on values’. Cooperation with China, he added, was necessary to tackle climate challenge and a multilateral world could not be built without effective Chinese participation ‘not in a “Chinese way”, but in a way that can be accepted by everybody’ (Borrell 2020a).

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of distillation during which the political and security dimensions began to jostle with the economics that had been the primary determinant of China-EU ties for two decades’ (Gokhale 2020). Subsequently, on 9 June 2020, Joseph Borrell, High Representative for Foreign Affairs and Security Policy, remarked that ‘China is without doubt one of the key global players. We have to engage with China to achieve our global objectives, based on interests and values’ (Borrell 2020a). This tended to reflect ‘a logical assumption’ that there was unlikely to be any change in the Europe-China relationship after the pandemic (Gokhale 2020). This re-appraisal by Europe seemed to reflect ‘a growing appreciation that the balance of challenges and opportunities presented by China’ had been shifting as its economic power and concomitant political influence grew with unprecedented scale and speed, and in ways that concerned European security’. These included, among others, China’s efforts ‘to cultivate separate European sub-constituencies’ like the 16 + 1 format, cross-sectional hybrid threats including information operations in European countries, Chinese behaviour in the South China Sea and the Indian Ocean and its targeted acquisition of key high-technology companies such as KUKA in Germany or key ports like Piraeus in Greece had begun ‘to raise red flags in the Chancelleries of Europe’. Thus, ‘China’s economic and financial practices backed by strategic motives threated unity and the European project itself, since it appeared to undo their efforts in terms of connectivity, regulatory frameworks and the building of a single European unity’ (Gokhale 2020). China’s actions in the first half of 2020, including the ‘clumsy Chinese efforts to use the confusion inside Europe to their propaganda advantage’ in the Union’s early handling of COVID-19, led the EU to make ‘a rare and blunt accusation against China’ on 10 June 2020.13 China’s aggressive actions in the South China Sea, on the Line of Actual Control with India and in Hong Kong, among others, had not only gained Europe’s attention but also underlined the critical importance of China to ‘Europe’s economic health’. In fact, European Commission President Ursula von den Leyen highlighted ‘the European dilemma’ when she

13 ‘Foreign actors and certain third countries, in particular Russia and China, have engaged in targeted influence operations and disinformation campaigns around COVID-19 in the EU, its neighbourhood and globally, seeking to undermine democratic debate and exacerbate social polarization, and improve their own image in the COVID 19 context’ (European Commission 2020b).

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remarked that Europe’s relations with China are ‘simultaneously one of the most strategically important and one of the most challenging that we have’ (von der Leyen 2020a). The European debate, Gokhale emphasized, was ‘no longer simply about market access, industrial subsidies, over-capacity in steel and hightech industries; stealing of IPR, and China’s assertive approach to the security, resilience and stability of digital networks’. Brussels had, in fact, begun ‘to turn towards how to balance economic co-dependency and co-prosperity with China’s strategic global intentions and efforts to seek military supremacy and its bearing on European security. In the trinity of determinants identified by the EU in March 2019—namely [negotiating] partner, [economic] competitor and systemic rival—the last dimension is gradually becoming the dominant political narrative’ (Gokhale 2020, emphasis added). Indian observers concur that candid EU statements should not lead one to make an inference that ‘the EU will follow the U.S. in ‘decoupling’ or join an “against-China” camp’ (Gokhale 2020). Europe does not share Indian ‘phobias or complexes—or security compulsions— regarding China’. While Europe will not hesitate to make its ‘feelings and opinions’ known to Beijing, it is acutely conscious of its limitations and its priorities in the contemporary world situation (Bhadrakumar 2020). In an interview to a leading business daily, when Josep Borrell was asked how India and the European Union could balance China’s efforts to dominate geopolitics through aggression and unilateral action as evident in the stand-off along the Line of Actual Control, he responded: ‘In world politics, one cannot only work with those with whom we agree or share the same values. We must recognize that we live in a world of competition, of different viewpoints, and strategic objectives. The European Union is not naive about China, but we are also acutely aware of the need to work with China on the pressing issues of our bilateral relationship and in international affairs. We have to engage in a clear-eyed way, standing firm on our values’ (Borrell 2020c). European Commission President von der Leyen too acknowledged that the Union shared ‘important’ relationships with both India and China. However, while Brussels shared ‘democracies and values’ with New Delhi, the relationship with China was ‘complex’ (von der Leyen 2020b).

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Conclusion Today, China has not merely emerged; it is clearly ascendant. In an increasingly turbulent world, the European Union has sought to partner like-minded countries like India to maintain a rules-based world order (see Jain 2020; Borrell 2020b). One of the factors behind the European Union’s Strategy 3.0—Elements for a European Union Strategy on India (November 2018)—was its desire for middle power cooperation to compensate for the unilateral actions of the United States and China (Pal Chaudhuri 2020a: 18). There was a ‘real crisis of multilateralism’ and Europe needed partners (Borrell 2020b). Despite political differences with China and shared values with India, the Europeans will continue to have a more extensive and deeper economic relationship with China than with India. Europe has not been willing to get embroiled in sovereignty issues over the China–Pakistan Economic Corridor. Europe also does not have the requisite military capabilities and resources to ‘assist’ New Delhi in its difficulties with China (Sibal 2019: 70). Beijing’s national ambitions and plans would affect the interests of both India and the Union. China’s quest for equal status with the United States is likely to be ‘at Europe’s and India’s expense’ (Sibal 2017b). The present disorderly world therefore presents an opportunity for India and the European Union to deepen and widen their conversations and cooperate to uphold the multilateral liberal order.

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CHAPTER 4

European Union Foreign Investment Policy in Asia and India Javier Arregui

Introduction Trade and investment have never been more important in international political economy than in current times, especially after the 2008 financial crisis, which brought a realization that investment and trade could be a stabilizing force in difficult times. For instance, in countries or regions like the European Union where the domestic demand was weak, trade softened the impact of recession by channeling demand from growing economies back to the Union. Foreign direct investment (FDI) is also a key variable in the current equation of economic growth. This is certain from an EU perspective in so far as approximately 90% of global economic growth in the next 15 years is expected to be generated outside the EU (European Commission 2016—Trade for All). This signifies that EU

J. Arregui (B) Department of Political and Social Sciences, Pompeu Fabra University (UPF), Barcelona, Spain e-mail: [email protected] Barcelona Center for European Studies (BACES) UPF, Barcelona, Spain © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 R. K. Jain (ed.), India, Europe and Asia, https://doi.org/10.1007/978-981-33-4608-6_4

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economies need to enhance trade and investment links with the new centers of global economic growth. FDI is therefore a pivotal element of the modern global economy and a centerpiece in the elaboration of contemporary commercial policies. In fact, investment and trade are today inter-dependent and complementary. FDI represents an important source of productivity and performs a crucial role in establishing businesses and jobs at home and abroad. FDI enables companies build the global supply chains that are part of the modern international economy (European Commission 2016—Trade for All). FDI reflects the aim of obtaining a lasting interest by a resident entity of one economy (direct investor) in an enterprise that is resident in another economy (the direct investment enterprise). ‘Lasting interest’ implies the existence of a long-term relationship between the direct investor and the investment enterprise as well as a significant degree of influence on the management of the latter (OECD 2008). The specialized literature has identified a number of benefits that FDI may have on receiving economies. The first one is the creation of employment (Grosse 1988). A higher employment contributes to a country’s economic growth (Zhang 2001). FDI also helps to increase productivity within the sectors involved (Javorcik 2004) as well as the transfer of technology from foreign to national companies and access to innovations and to global value chains (Porter 1990; Jabbour and Mucchielli 2007). More generally, FDI provides a greater well-being for the inward investment country’s citizens (Grosse 1988; Zhang 2001). As highlighted by Globerman and Shapiro (2003), the quality of life of the population of a country is positively related to its FDI inflow. This is why most governments try to develop economic policies seeking to attract greater FDI (Bellak et al. 2010). The main mechanisms used by governments are trade agreements (UNCTAD 2008) and fiscal facilities (Yamawaki 2006). Thus, the overall benefits of inward FDI are the creation of jobs, the optimization of resources allocation, the transfer of technology and skills, increased competition, and enhanced trade. The choice of a location for FDI depends on both the country factors of origin that motivate the outflow of capital as well as the country of destination factors that attract investment (Dunning 1980; UNCTAD 2006). While there is some consensus about the size of the market as a determining factor in attracting FDI (Jiang 2005), there is less consensus over other factors such as labor costs (see Zhao and Zhu 2000; Na and Lightfoot 2006). Furthermore, FDI is affected to a great extent by the

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economic, legal, and political environment of the host country (European Parliament 2016). There are different paradigms to explain FDI. The most relevant theories to understand FDI are derived from classical macroeconomic theories to the theory of investment development path (IDP) passing through other less-developed theories such as the theory of the internalization of markets, Dunning’s eclectic approach, or the theory of development in phases. The classical macroeconomic theory, for example, justified international trade historically as being due to the existence of comparative advantages among nations regarding to different factor endowments. The theory of the internalization of markets (Buckley and Casson 1976) highlights the importance of regional factors. Dunning’s eclectic approach (1980, 2000) argues that firms locate wherever they have a better productive and market advantage. The theory of the development in phases (Johanson and Valhne 1977) introduced the psychic distance between the inward and outward investment economies to explain the process of internationalization of a firm. However, the theory which has been most developed and tested so far is the theory of IDP (Dunning 1981; Dunning and Narula 1996; Verna and Brennan 2011). This theory relates the economic stage of development (and/or its country’s competitive advantage) with FDI. According to Dunning (2001), the four main reasons why international companies make FDI are: (1) the search for natural resources; (2) the search for markets; (3) the search for efficiency; and (4) the search for strategic resources. These objectives can be associated with the different stages established by the IDP theory. I will use the theoretical framework provided by the theory of IDP in order to better understand the Asian and Indian flows of FDI. The European Union is currently the world’s largest exporter and importer of combined goods and services as well as the largest foreign investor and the most important destination for FDI. From this perspective, the EU is the most relevant FDI actor. In fact, the EU is the largest trading partner of about 80 countries and the second most important partner for another 40 (European Commission 2016, Trade for all). The aim of this chapter is to analyze the role of the EU FDI on Asia and India. More specifically, I examine the extent to which the attraction of FDI in India (and other Asian economies) has depended on the stage of development of the host economy. The structure of the chapter is divided in the following sections. Firstly, I develop the theory and the main drivers of the investment development

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path. Secondly, I describe and explain (a) the role of the EU on FDI in global terms; (b) the main arguments showing why the EU has a global leading role in this field; and (c) the type of trade and investment relations the EU is trying to make with third partners. Thirdly, I analyze the logic and patterns of FDI investment in Asia. Fourthly, I focus on the Indian case and I show the main strengths and shortcomings of this country in order to increase both inward and outward FDI. Subsequently, I analyze the implications for India and the EU for the non-agreement partnership on trade and investment. Finally, I make a summary and formulate the main conclusions of this research.

The Theory and Drivers of the Investment Development Path The theory of IDP was first advocated by Dunning in 1981 and has since been developed by the same author as well as other scholars (Dunning 1986, 1993; Dunning and Narula 1996; Durán and Úbeda 2005). This theory argues that there is a relationship between the level of development of an economy and the amount of inflows and outflows of direct investments. In particular, the structural and institutional transformations associated with the economic developments of a country have an impact on the type of global competitive advantage of local companies. The theory of IDP establishes five stages from which countries might get more or less investment according to their level of development. During the first stage, which is the one with the least development, countries are rather limited in being able to attract inward direct investment. This reflects the inadequacy of the domestic markets where demand conditions are not high, there is poor infrastructure or low-skilled and low-motivated labor in addition to a low per capita income. Thus, the only attraction for investment will be limited to the existence of natural resources. As a consequence, the net investor position of these countries is negative. Furthermore, FDI in markets in these early stages is mainly aimed at sectors that are intensive in natural resources or sectors that are intensive in physical capital and/or in low-skilled labor (Durán and Úbeda 2005). These are investments that pursue the ‘search for resources and markets’ in the absence of the existence of other comparative advantages (Dunning and Narula 2004). In the second stage, the FDI in a country is higher than in the previous stage. In this scenario, a country engages in a variety of economic and social policies which will have an impact in the

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structure of the domestic market. Protection and subsidies to domestic products may take place. These processes might induce an improvement of infrastructure, institutions as well as a better training of labor. At this stage, some innovation capacity might be created. Countries in the third stage show a gradual decrease of inward direct investment as well as an increase in of outward direct investment. This means that the net investor position of the country becomes less negative and equal to zero. The local companies may begin to develop technological capacities that may favor their internationalization (e.g., increase of the outward FDI) and it also might be the case that comparative advantages in labor intensive activities start to deteriorate in so far domestic wages start to rise. Stage 4 is reached when a country’s outward direct investment exceeds the inward investment. Thus, the net investment position is positive. At this point, domestic firms can effectively compete with foreign firms. This means that domestic firms are ready to penetrate international markets. In this stage, it is likely that the role of the government will change in order to reduce market shortcomings and maintain competition by fostering technological accumulation in key productive sectors. The fifth and final stage is characterized by reaching a net investment position close to zero. After this stage, there are no theoretical or empirical results that describe future behavior. The role of government is crucial, mainly in the early stages, in so far as it can favor the attraction of FDI and accelerate economic growth (Verna and Brennan 2011). Government action should go in the direction of improving institutions, developing infrastructure, controlling macroeconomic variables (e.g., inflation), or delivering basic quality policies with respect to education and health services (Verbeke et al. 2008). In the final stages, the role of government becomes less relevant and the role of firms and a well-functioning market become crucial factors. Thus, according to IDP theory, the stage of development of any country should lead to a precise strategic goal (search of resources, constructing markets or getting efficiency and/or transfer of technology) (Li and Clarke-Hill 2004). In other words, this theory shows that there are a number of building blocks which are essential in order to improve FDI. This can be better visualized in Graph 4.1 which shows twelve pillars of competitiveness according to the five stages of investment development of an economy. The most relevant stages are the following: First, institutions and the institutional environment are particularly relevant as they establish institutional frameworks where individuals, firms,

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STAGES 1 AND 2

Basic Requirements: Ins tu ons

Key for Factor Driven Economies

Infraestructure Macroeconomic enviroment Health and primary educa on

STAGE 3

Efficiency Enhacers

Key for Efficiency Driven Economies

Higher educa on and training Goods markets efficiency Labor market efficiency Financial market development Technological readiness Market size

STAGE 4 AND 5

Innova on and sophis ca on factors:

Key for Innova on Driven Economies

Business sophis ca on Innova on

Graph 4.1 Relationship between Theory of IDP and the Key Drivers of Investment Policies (Source Global Competitiveness Index [2016], World Economic Forum)

and governments interact to generate wealth. If this environment does not work properly, inefficiency raises transaction costs and investor risk (Kwok and Tadesse 2006; Van Wyk and Lal 2010). Furthermore, institutional weakness increases information asymmetries among economic actors. This means that foreign companies will need to spend more time and resources looking for information (Meyer et al. 2009). In a country

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with few constraints in the institutional framework, foreign investments of international companies are not subject to discriminatory policies related to the access to local resources (Quer et al. 2011). Investors clearly prefer countries with secure property rights, low levels of corruption, and few social conflicts (Biglaiser and De Rouen 2006). Therefore, the role of institutions goes beyond the legal framework. Government attitudes toward markets are also very important: excessive bureaucracy, overregulation, corruption, lack of transparency, or political dependence of the judicial system may impose important economic costs to investors. Infrastructure (transport, telecommunications, or electric power) are critical services for the correct implementation of production processes and the functioning of the economy. Quality infrastructure integrates the national market at low cost to international markets (Deichmann et al. 2008). Thus, the more efficient the transport infrastructure, for example, of raw materials and products, the lower the unit of production costs (Ho and Rashid 2011). All this means that a well-developed transport and communication infrastructure network is a prerequisite for the access of less-developed communities to core investment activities (see Maniam 2007; Ranjan and Agrawal 2011). Macroeconomic stability is also considered a necessary although not a sufficient condition for attracting FDI (Van Wyk and Lal 2010). Macroeconomic stability alone cannot increase the capacity to attract investment or to increase the productivity of a nation. Nonetheless, it is recognized that macroeconomic disarray harms the economy. This is related to problems derived from a high inflation rate, a high public deficit, or a high external debt ratio. Such macroeconomic variables may worsen the business environment and negatively influence FDI. They could generate difficulties for providing services efficiently due to resource limits. Furthermore, companies cannot operate properly with volatile and high inflation rates (Sala-i-Martin et al. 2011). Therefore, economies in the first stages with greater macroeconomic stability will be more attractive to FDI (Ho and Rashid 2011). Higher education and health services also play a role for FDI. For example, in relation to health services there is consensus that a healthier labor force decreases absenteeism at work and increases productivity (Salai-Martin et al. 2011). Basic training and higher education are crucial factors for economies that want to move up the value chain beyond simple production processes and products. In particular, today’s globalizing economy requires countries to nurture pools of well-educated

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workers who are able to adapt to their changing environment and the evolving needs of the production system (Sala-i-Martin et al. 2011). Finally, the size of the market is also a relevant factor for FDI insofar as it reflects the potential demand to which a company can market its products and be increasing the firms’ productivity (since large markets allow companies to exploit economies of scale) (Vogiatzoglou 2008; Felisoni et al. 2010). These markets generate higher FDI opportunities (Ho and Rashid 2011). This is also the reason why in the age of globalization international markets have become a substitute for domestic markets, especially for small markets.

EU Investment Policies In recent decades, the investment policy of the European Union has been focused into progressively abolishing restrictions on FDI. Opening up the economy to investment is considered to be a major source of global productivity gains (EC 2016—Trade for All). Thus, outward investment helps firms to improve their competitiveness in the global arena, mainly in the form of higher productivity. In fact, both inward and outward investment is a key part of the structure that connects the EU economy to global value chains (GVC). This concept is becoming key within international trade insofar as the global value change involves the full range of actions that are required to bring a product from its conception, through its design, its sourced raw materials, its marketing, and/or its distribution to the final consumer. GVC means, among other things, that trade policy can no longer be approached from a narrow mercantilist view. This is because raising the costs of imports reduces firms’ ability to sell in global markets. GVC helps to understand how interdependencies work in a global world. The term GVC captures very well the current global political economy and how firms try to increase their competitiveness at their global level. This is why EU trade policy is trying to strengthen Europe’s place in global supply chains. The EU’s policy on FDI, according to 2020 objectives and priorities, is committed into generating this added value for EU companies (EC 2016—Trade for All) through fostering outward investment as well as trade agreements. The failed multilateral negotiations of the Doha Round in 2008 among 155 countries had the central objective of liberalizing global trade. Substantial differences in the levels of development of the participating states, as well as their preferences in many antagonistic cases, made a

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multilateral agreement impossible under the aegis of the World Trade Organization (WTO). All this signified that many relevant actors of the world economy envisaged the establishment of bilateral free trade agreements (FTAs) (Whalley 2008). By 2020 the EU has established free trade agreements with a large variety of countries: notable examples include Canada, Japan, South Korea, Mexico, Chile, South Africa, Columbia, Peru, Vietnam, Singapore, and Mercosur. At the same time, FTA negotiations are at various stages with many others such as the United States, Australia, New Zealand, Thailand, Indonesia, Philippines, India, Malaysia, and Morocco (European Commission 2020). Looking at investment policies from a more historical perspective, the most visible manifestation of Member States’ policies on investment over the last 50 years is the number of so-called bilateral investment treaties (BITs) that they have concluded with third countries. Over the past 50 years, the EU Member States have signed 1,400 bilateral investment treaties with the main goal of protecting and encouraging investment. EU Member States together account for almost half of the investment agreements currently in force around the world (EC 2016—Trade for All). Although emerging market economies have become increasingly active today both as investors and recipients of investment, the EU is both the world’s leading host of FDI as well as the leading source of outward investment. As a ‘market leader,’ the EU benefits from its openness toward the rest of the world, including in the area of investment (see Table 4.1) Table 4.1 FDI Flows by Country, 2013–2016 2013

EU United States Japan China India

2014

2015

2016

Inflow 336811 201393

Outflow 340011 303432

Inflow 256613 171601

Outflow 204344 292283

Inflow 483839 348402

Outflow 535957 303177

Inflow Outflow 566234 470351 391104 299003

2304 123911 28199

135749 107844 1679

10612 128500 34582

129038 123120 11783

−2250 135610 44064

128654 127560 7572

11388 133700 44486

Source World Investment Report 2017

145242 183100 5120

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According to Table 4.1, the EU is the world’s largest exporter of international investments, and the world’s leading recipient of foreign direct investment. Over the last years, the EU has accounted for approximately 30% of global FDI flows. The United States is the second most important inflow destination while China is gradually becoming the third most important destination of FDI. As Table 4.1 illustrates, India has been receiving around one-third of China’s FDI. India also exhibits lower levels of outflow investment with an irregular pattern. For the first time in EU history, the Treaty of Lisbon has given official competences to the EU (as a collective entity) regarding external economic matters, including foreign direct investment policies. There are several consequences to this innovation. Firstly, the new capacity of the EU broadly impacts current preferential trade agreements (PTAs). In particular, it strengthens the negotiating capacities of the EU and the Member States collectively (more than if an individual Member States negotiates on its own). Secondly, because the EU is the largest global investor, the new EU formal competence could even contribute to shaping an emerging international investment regime. Furthermore, as Chaisse (2012) argued, the Lisbon Treaty not only brought FDI within the EU’s competence but also inhibited Member States from renegotiating existing BITs. However, the unfortunate absence of a definition of ‘FDI’ in the Lisbon Treaty still leaves the door open for disagreement. Through the new investment policy, investment protection is one of the most important EU priorities (Arregui 2015). Indeed, even in bilateral investment treaties many EU Member States already sought a range of guarantees from third countries on the treatment of their investments (e.g., commitments against discriminatory treatment or a guarantee of effective compensation in case of expropriation). However, not all Member States have been able to obtain similar advantages. The Lisbon Treaty’s attribution of FDI as an exclusive EU competence now integrates investment protection into the Common Commercial Policy. Investment protection and arbitration have generated an exciting debate about the need to preserve the right of public authorities to regulate investor-state disputes. The EU is actually trying to transform the former investor-state dispute settlement into an Investment Court System composed of a Tribunal of First Instance and an Appeal Tribunal operating like traditional courts. The EU´s strategy is to create a clear code of conduct to avoid conflicts of interest as well as hiring independent judges

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with high technical and legal qualifications comparable to those required for the members of international courts.

EU Investment in Asia The EU is clearly aware that Asia is taking a leading role in the global trading map. It has acknowledged that the major economic growth in the future will be generated outside the EU and that most of it will take place in today’s developing countries. Such countries will account for 60% of world GDP by 2030 (European Parliament 2016). The Union is aware that investment is a crucial part of this process and today Asia is one of the most attractive destinations for FDI. Specifically, the Asia-Pacific area is understood as a region critical for the operation of global value chains’ (European Commission 2016: 29—Trade for all). Asian participation in global value chains has substantially expanded through China’s leading role as a key supplier of intermediate and final goods of EU industries. Asia has become the new engine of global growth. Over the 2002– 2012 decade, the US economy grew by an average 1.6%, the EU by a 1.7%, and Latin America by 4.6%; in the meanwhile, Asia expanded by 5.6% (European Parliament 2016: 8). As a consequence, Asia has substantially increased its regional share of global GDP. For example, during the time framework 2003–2016 (shown in Graph 4.2 below), the GDP growth of the main Asian economies was significant. This economic

Graph 4.2 Economic Growth (in GDP) in Select Asian Countries, 2003–2016 (Source World Bank 2017)

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growth was led by countries such as China and India. Overall, they grew by 14.2 and 9.8%, respectively, in 2007. In 2010, these two countries witnessed spectacular economic growth. Even if the rest of the Asian countries also experienced an important economic increase in their GDP they remained far from the levels reached by both China and India. In addition, the economic dynamism of Asian economies is expected to continue in the coming years. The Asian share of world GDP is projected to reach 29.4% in 2030 (from 22.6% in 2004). At the same time, the share of the EU is expected to decrease from 33 to 25.1% (European Parliament 2016). This means, among other things, that Asia is the leading region in trade and investment and that it has shifted the worldwide organization of production to the east. As a matter of fact, Asia is also the second largest destination of FDI after the EU during 2003–2016 (FDI Intelligence 2017). Furthermore, Table 4.2 provides more detailed information about the capacity of Asian countries to attract FDI. It also shows that China and India are the countries with the highest FDI levels while also showing Indonesia, Malaysia, and Singapore as further key actors for outflow investments (see Table 4.2). The foregoing discussion illustrates that the outstanding economic performance of Asia has not only been due to China. Indeed, there is clear evidence that other Asian countries are beginning to take leading positions in both inward and outward investments. Furthermore, political events such as President Donald Trump’s rejection of the Transatlantic Trade and Investment Partnership (TTIP) or the execution of Brexit emphasize the need for the EU to expand its internal market by looking at other regions such as Asia (which is itself likely to grow the most in the coming years) (European Parliament 2016). Currently, the EU is Asia’s largest trading partner with more than 40% of total EU trade (Amighini 2016). The Union is China’s largest trading partner and China is the EU’s second largest partner. Japan, South Korea, and India are the EU’s seventh, eighth, and ninth largest trading partners (European Parliament 2016). The Association of South East Asian Nations (ASEAN) is the EU’s third largest trading partner outside Europe, after the United States and China (European Parliament 2016). However, to present date the number of EU-consolidated trade and investment agreements in Asia is still relatively small, especially considering the relevance of such countries in the global political economy.

54394.0 5771.1 14496.3 14499.1 25245.0 810.0

102091.65 4295.62 12327.50 5656.38 28837.83 2822.80

−87842.6 −1520.8 −4971.8 −393.8 −10765.4 −2756.0

14249.0 3468.5 7355.7 5262.5 18072.4 111.3

Outflows

Net

Outflows

Inflows

2008–2012

2003–2007

213516.2 14250.7 33375.8 8517.6 39298.1 8195.4

Inflows −159122.3 −8479.6 −18879.5 5981.5 −14053.0 −7385.4

Ne

Foreign Direct Investment in Select Asian Countries, 2003–2016

Source World Bank (2017)

China Indonesia India Malaysia Singapore Vietnam

Table 4.2

146923.5 10593.8 6503.2 12518.2 37776.8 1301.5

Outflows

2013–2016

243017.9 18081.0 37799.4 11322.2 67712.0 10625.0

Inflows

−96094.4 −13387.8 −31296.2 1196.1 −299935.2 −9323.5

Ne

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Instead of reaching multilateral trade and investment agreements, the European Union has been trying to increase FTA numbers by conducting individual negotiations with multiple Asian countries. At the time of writing, current negotiations still include India (since 2007 but stalling), Malaysia (since 2010 but stalling), Thailand (since 2007, but stalling), Indonesia (since 2007, but proceeding), Philippines (since 2007, but stalling), Myanmar (since 2014, but halted in 2017), New Zealand (since 2015, but proceeding) as well as smaller-in-scale investment agreements talks with China (since 2005, initially stalling but now proceeding). In terms of success, the EU concluded bilateral FTAs with South Korea (2011), Singapore (2019), Japan (2019), and Vietnam (2020) (European Commission 2020). As clearly shown, the EU is now placing further attention to Asia and has undertaken a different strategy for each country. One of the aims of the EU is to dismantle trade and investment barriers. As declared by their marketing strategy on institutional websites, the EU is willing to move in the direction of ‘new generation agreements.’ The EU-South Korea FTA is a masterpiece example of this strategy, as the European Commission itself has argued it to be ‘the most ambitious trade deal ever implemented by the EU’ (European Commission 2016—Trade for all). This was because it eliminated almost 99% of duties on both sides within five years of signature in dealing with non-tariff barriers (NTBs). A similar case occurred with the recent EU-Japan Economic Partnership Agreement, aiming to eliminate over 97% of customs duties by full implementation. Furthermore, even after the entry into force of the agreement the EU and Japan have committed into further discussing investment protection standards and mechanisms for investment protection dispute resolution (EC Website 2018).

India and Inward and Outward Investment According to IDP Theory For the EU, India is its ninth largest trading partner. For India, the EU is its largest trading partner and its largest export destination (European Commission Directorate General 2018). The EU represents India’s second largest importer partner and the largest export market for Indian goods. This illustrates that India has been successful in attracting inward FDI in recent decades. FDI started to rise in the early 1990s after the liberalization of the policy regime (see Verna and Brennan 2011). The liberalization of government policies after 1991 and the corresponding

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moderation of regulations facilitated the growth of both outward and inward FDI (UNCTAD 2004). Indian firms have been gradually recognizing that they cannot work only at the local level under a global market regime and that their survival primarily depended on the capacity to take advantage of large opportunities offered by the global market. This is why Indian multinationals have started to expand internationally in recent years (Pradhan 2007). In this regard, the data shown in Table 4.2 show that the country has also emerged as an important international actor in outward FDI (although with varying degrees) over the time framework 2003–2016. It should also be considered that India and China are the two most populous countries with approx. 1.31 and 1.38 billion people, respectively. India is even projected to bypass China by 2030 with 1.5 billion people. This is a clear indicator (among others) that securing good trade and investment relations with these two countries will be essential for the EU. It could also be one of the reasons why the EU and India have sought to enhance economic partnership. The European Union and India began discussions over either an FTA or a Bilateral Trade and Investment Agreement (BTIA) in 2007. However, negotiations reached an impasse in 2013 owing to a number of controversial issues which are very sensitive to both parties. The lack of agreement is clearly the result of different economic structures and reflects conflicting interests of economies at different levels of development. The most important disagreements have occurred over: the automobile industry, agricultural products, intellectual property rights, government procurement, investment liberalization, Indian IP protection regime for services as well as different approaches toward the protection of investment (European Parliament 2016; Bungenberg and Hazarika 2017). Most of the disagreements still persist seven years after the negotiations were suspended, although the Commission claims to maintain regular contacts with Indian authorities (European Commission 2020). If the FTA had been concluded, it would have covered 20% of the world population and would have had a very large impact on both economies. If the BTIA had been concluded, it would have been one of the most important bilateral agreements within the current international trade system. A way out of the impasse would perhaps be to seek a less ambitious agreement with more limited content. The IDP theory can perhaps help to understand the hardships in deepening EU-Indian investment and trade relations as it has provided a long-standing explanation for both inward and outward investment

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(Verna and Brennan 2011). Dunning and Narula (1996) argued that IDP fluctuated for countries according to the efficacy of government and its ability to influence macroeconomic variables such as inflation or growth rates and tariff structure. Moreover, infrastructure development, education and training levels as well as government regulations directly relate to matters such as foreign ownership in an investment project, the duration of FDI licenses, or even government initiative to attract FDI flows. According to the data from previous studies (Verna and Brennan 2011) as well as some recent data provided by the Global Competitiveness Index (2017–2018), India would be currently located in stage 2 of the IDP. This implies that India has reached an important stage of increasing growth of outward FDI in which, among other features, Indian firms are able to compete internationally. The increase of Indian outward foreign investment (see Table 4.2 and Graph 4.3) signifies active participation by Indian firms in international capital markets. This is a robust indicator of India’s integration in the international political economy. However, India is still a net recipient of FDI. This conclusion is confirmed on a closer examination of Table 4.2 and Graph 4.3 over the longer time period. This table shows that during 2003–2016, India has gradually decreased the balance between the inflows and outflows of investment. However, the pattern is still slightly unbalanced in favor of inward investment. Graphs 4.5 and

Graph 4.3 FDI in India, 2003–2016 (Source World Bank 2017)

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4.6 also identify other possible shortcomings of the current Indian position. Graph 4.4 highlights the evolution of the contribution of each of the pillars of competitiveness in Indian economy. In the decade 2008– 2018 there has been a clear improvement in the area of institutions, infrastructure, macroeconomic environment, health and primary education in India. According to IDP theory, all these are key elements in becoming more competitive and innovative as well as attracting more FDI. In addition, Graph 4.5 enables us to understand India’s competitive level for attracting more FDI. Thus, on average, India is better in all items than the average of all South Asian countries. The main strength of India lays in its market size. In relation to institutions, infrastructure, macroeconomic environment as well as health and education, the position has clearly improved. However, in comparison with other Asian countries (such as Japan, South Korea, and even China), there is still considerable scope for improvement. Perhaps the weakest factors are those related to the efficiency of the market, business sophistication and technological and financial market development. As explained earlier, all of these are key factors to move from stage 2 to stage 3, which is closely related to increasing FDI. However, it is not easy to achieve this unless a country shows a better performance both in institutions and the efficiency of the market.

A Missed Opportunity for EU-India Trade Relations? The halting of negotiations of 2013 toward either an EU-India FTA or BTIA has had economic implications for both economic actors in the short term. In order to provide evidence about this impact, we will refer to the data in Tables 4.3, 4.4, and Graph 4.6. Firstly, in terms of exports between both economies, Table 4.3 and Graph 4.6 show that there has been a negative impact across the time period analyzed (2002–2015). Thus, between 2002 and 2007, India’s trade with the rest of the world has grown more than with the EU (100.94% versus 94.89%). During 2002–2015, there has been a very sharp slowdown in the growth of export from India to the EU (94.9% versus 47.5%). The same can be said about exports from the EU to India (104.2% versus 30.4%). That is to say, there has been a change in trends of exports between the two economies as clearly both of them have been adversely affected. Interestingly, this

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Graph 4.4 Factors Explaining India’s Competitiveness over Time (Source Global Competitiveness Index 2017–2018)

phenomenon occurred when the free trade agreement was being negotiated during 2008–2013. Furthermore, this tendency has taken place within a context in which the exports of the EU and India to the rest of the world have actually increased. Therefore, these figures showed that there existed a reverse trend in the economic relations between the EU and India. Table 4.4 shows information about the FDI flow between both economies during 2003–2015. The growth of the EU’s FDI flow to India has been considerably higher between 2003 and 2007 than that of India to the EU. In that period, EU direct investment in India grew by 462% while the Indian FDI in the EU increased by 166%. Both figures are quite high and indicate an increasing trend during those years in the exchange of investment flows. However, after 2007, the growth of FDI flows slowed down considerably. During 2007–2015, FDI of both economies underwent setbacks producing a decrease in flows. Overall, EU-India FDI only rose by 37% during the 2007–2015, a figure much lower than the 462% of the 2003–2007. On the other hand, in 2015,

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Graph 4.5 Scheme of the Distribution of Competitiveness in India, 2016 (Source Global Competitiveness Index 2017–2018) Table 4.3 Variation of the Value of Exports among India-the EU–World

India-World EU-World

2002–2007

2007–2015

100,94 39,44

123,84 45,04

2002–2007

2007–2015

94,89 104,20

47,566 30,479

India-EU EU-India

Source Own elaboration from Eurostat dataset (2018a)

Table 4.4 Variation of the Value of FDI Flows between the EU and India

2003–2007

2007–2015

462,50 166,67

37,78 -31,25

FDI flows (EU-India) FDI flows (India-EU) Source Eurostat Reports (2018b, c, d)

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Graph 4.6 Interannual Variation of Exports EU-India-World, 2002–2015 (Source Own elaboration from Eurostat dataset [2018a])

India sent less FDI to the EU than in 2007, resulting in a decrease of 31%. According to the key figures analyzed (such as the exports and FDI levels between the EU and India during 2002–2015), there has been a gradual adverse impact across time in comparative terms for the economic relations of both economies. This is certain in the case of India as well as in the case of EU investment with the rest of the world. In this context, the 2008 global economic crisis is relevant in order to explain this tendency. However, the obstacles in reaching a trade and investment agreement between both economies have probably contributed to create a different scenario in the mutual relationship. According to a report made by the European Commission in 2009, in the midst of the FTA negotiations the average expected scenario that a trade and investment agreement could bring for both actors would have been an FDI level (from the EU to India) of e17.7 billion in the short term (European Commission 2013: 61). This signifies that the EU has, to a certain extent, redirected international investment to other geographical areas different to India. A broad FTA would have also generated a higher value of Indian exports in world trade by more than 10% in the short term as well as an additional 1.6% of increase of GDP per annum in the first years. The expected figures for the EU in relation to GDP, exports, and investment were more modest. In the case of the European Union, an agreement would have meant only

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a 0.1% annual increase in its GDP and an annual increase of 0.37% of EU exports (European Commission 2013: 61). These preliminary figures seem to highlight the limited effectiveness of a potential FTA between the two countries, at least in comparison with a more limited BTIA. Notwithstanding, the lack of the former may also have meant a missed opportunity for India to further develop some key macroeconomic indicators (with a direct effect on socioeconomic issues) via FTA requirements generally supported by the Union.

Conclusion This chapter has shown the extent to which FDI is a key variable for understanding the current global political economy. Inward and outward investment is the new medium of contemporary trade policy. Overall benefits of inward FDI include the creation of jobs, the optimization of resource allocation, or the transfer of technology and skills while outward investment helps to increase productivity through global value chains. There are a number of paradigms to explain FDI, but the theory that has been most developed is the IDP theory, which relates the economic stage of development with FDI. In particular, it argues that the structural and institutional transformations associated with the economic development of a country have an impact on the type of global competitive advantage of local companies. The European Union is the most relevant FDI actor while Asia has become the new engine of global economic growth. This means that Asia is the leading region in trade and investment (after the EU) and that the worldwide organization of production has shifted to the east. Within Asia, China and India are the countries with a higher FDI while for outflow investments Indonesia, Malaysia, and Singapore are also key actors. Negotiations for an FTA or BTIA which began in 2007 were called off in 2013 owing to a number of differences whose origins laid in different economic structures reflecting the conflicting interests of both economies. These were mainly due to different levels of development. The chapter has also shown through empirical data that India is in the second stage (creating drivers for investment) according to IDP theory. In this phase, a country like India is engaged in a variety of economic and social policies which are having an impact on the structure of the domestic market such as the protection of domestic producers. To a certain extent, these processes are leading to an improvement of the

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infrastructure, the institutions, more skilled labor as well as creating some innovation capabilities. However, according to IDP theory, in the near future India will have to further enhance the factors for both efficiencies driven economies (such as financial market development or technological readiness) as well as the key factors for innovation-driven economies (such as business sophistication and innovation). Disclaimer The production of this chapter has been co-funded by the Erasmus + Programme of the European Union. The European Commission’s support for the production of this publication does not constitute an endorsement of the contents, which reflect the views only of the authors, and the Commission cannot be held responsible for any use which may be made of the information contained therein.

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CHAPTER 5

India and ASEM: From Membership to Active Engagement Rajendra K. Jain

Introduction India’s multilateral journey in the Asia-Pacific region began in the 1990s and has to a great extent been the result of its Look East Policy, which reversed decades of neglect of Southeast Asia and gradually led to the forging of closer institutional links with the Association of Southeast Asian Nations (ASEAN).1 It was not easy to overcome entrenched perceptions 1 In January 1992, India became a sectoral dialogue partner for tourism, commerce, investments and science and technology, a full dialogue partner in December 1995, a member of the ASEAN Regional Forum (ARF) in July 1996, and annual ‘ASEAN plus One’ summit-level dialogue since December 2002.

This chapter is an expanded and updated version of the article originally published in India Quarterly: A Journal of International Affairs, 69(4) Copyright © 2013 Indian Council of World Affairs (ICWA). All rights reserved. Reproduced with the permission of the copyright holders and the publishers, SAGE Publications India Pvt. Ltd., New Delhi. R. K. Jain (B) Centre for European Studies, Jawaharlal Nehru University, New Delhi, India © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 R. K. Jain (ed.), India, Europe and Asia, https://doi.org/10.1007/978-981-33-4608-6_5

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of South Asia as being ‘outside’ of Asia. It took a decade and six summits for India to become a member of the Asia–Europe Meeting (ASEM). In contrast to other regional organizations, Indian scholars have paid scant attention to ASEM.2 This chapter examines India’s decade-long quest for membership of ASEM, which represents an interesting case study of identity and exclusion of a major Asian country from a key interregional forum. It highlights how India’s purposeful and constructive Look East Policy since the early 1990s facilitated Indian membership of ASEM in 2006. It discusses India’s engagement with ASEM since its admission, examines media and elite perceptions of ASEM and makes some concluding observations.

The Birth of ASEM A few months after the launch of the European Union’s ‘New Asia Strategy’ (1994), Singapore’s Prime Minister Goh Chok Tong proposed the idea of an Asia–Europe Meeting in October 1994 as a necessary third axis in a world where Asia and America and America and Europe were well linked. Five months later, the ASEAN Senior Officials Meeting (SOM) (17–19 March 1995) adopted a position paper drafted by the Singapore Ministry of Foreign Affairs which identified three major regions of economic power in the world—North America, Europe and East Asia. Participation, it stated, would be based on the principle that the EU would select the European participants and that ASEAN would choose the Asian ones. The inaugural ASEM meeting, the position paper added, should be ‘a small and manageable group of countries’ though the door would be kept open for new participants (Serradell 1996: 190, footnote 9). India had, in fact, been mentioned in the Singaporean Prime Minister’s proposal for ASEM (Robles 2008: 27) in keeping with the island nation’s efforts to gradually enhance India’s engagement with Asian regional organizations. ASEAN’s views about India’s inclusion in ASEM subsequently changed. The choice of participants, according to the Singapore concept paper, would now be based on the consideration of including only ‘dynamic economies which have contributed to the region’s prosperity and growth’ (cited in Hwee 2003: 24). Evaluated against the score of 2 The solitary article on ASEM that has been published in Indian scholarly journals on international affairs remains Naidu 1998.

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economic growth and trade openness, India lay in ‘the penumbra of Asia’. For the worshippers of the market, India had been ‘priced out of Asia’ (Baru 2007: 220–221; Devare 2006: 152). Two months later, at the Senior Officials’ Meeting in Singapore (2–4 May, 1995), the EU’s concept paper entitled ‘Meeting between Europe and Asia’ concurred with ASEAN’s views regarding the potential membership of the interregional organization. Since ASEM’s inaugural meeting, it stated, would be ‘experimental and open to change and as pragmatism would be required in its presentation, it would seem advisable to keep the number of participants small’. Brussels agreed that it would be up to ASEAN to determine which ASEAN countries would participate while the EU-15 would decide the European participation (Serradell 1996: 191, footnote 10). At the SOM meeting, ASEAN clarified that it had extended official invitations only to China, Japan and South Korea. Thus, in the three preparatory SOM meetings held to decide the format, participation and agenda for the first ASEM summit, ASEAN apparently did not seriously consider India’s candidature. In its first Communication (16 January 1996) on ASEM, the European Commission acknowledged that the first ASEM meeting would have ‘a limited participation’, though both sides agreed that it should be ‘evolutionary in character’ and the first of a series of meetings. The EU left the choice of the Asian participants to the ASEAN side (European Commission 1996: 4). The increasing weight of Asia in the world economy, the Communication noted, would contribute to a multipolar world, in which one should not ‘forget’ South Asia (European Commission 1996: 5). In the Europe-Asia Forum on Culture, Values and Technology (Venice, 18–19 January 1996), organized as a ‘lead-up’ to the inaugural ASEM summit in Bangkok, the European Union was ‘generous’ in its invitations. Without whining about India’s exclusion from the ASEM summit, India’s High Commissioner in London, L. M. Singhvi, underlined the need for a better understanding of Asia’s geography (Sharma 1996). The question of future membership, the Council felt, would be dealt with at a later stage and reiterated the Union’s intention to strengthen relations with India (Monfils 1996, cited in Gaens 2008: 151, footnote 1). In the third week of February 1996, British Foreign Secretary Malcolm Rifkind suggested that India, Pakistan, Australia and New Zealand join the second summit to be held in London. This was quickly

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rejected by Malaysian Prime Minister Mahathir Mohamad who dubbed it as ‘too big, with too many conflicting interests’ (The Hindu 1996d). Among the ‘fiercest critics’ of India’s admission in ASEM were Thailand and Malaysia. Prime Minister Mahathir opposed any enlargement since it would hinder ‘constructive dialogue’, dilute the East Asian/Pacific orientation and make it more difficult and unwieldy for the Asian side to take initiatives within ASEM (Hindustan Times 1996). ‘If it becomes too big and confusing’, he added, ‘there will be many conflicting interests and we cannot have a real dialogue. It will become confused and nothing can be achieved’. He felt that ‘at the moment, we have to see whether it [ASEM] will work or not before admitting new members’ (Sunday Star 1996; The Hindu 1996d). The Malaysian Prime Minister did not want Australia and New Zealand to come in. He clubbed India and Pakistan and maintained that both of them ought to come in together while arguing against the expansion of ASEM. Japan had advocated the inclusion of Australia and New Zealand, but also eventually envisaged India and Pakistan as future members.3 The Indian media was critical of the ‘churlish’ stance of China, Japan and ASEAN, especially Malaysia, towards Indian membership of ASEM (Times of India 1996).

The Inaugural Summit, 1996 The inaugural summit (Bangkok, 1–2 March 1996) was attended by 25 heads of state or government in East Asia and Europe—the Asian side consisted of seven ASEAN countries along with China, Japan and South Korea and the EU-15. India—Asia’s and the world’s second most populous nation—had been kept out on the pretext that some ASEAN countries wanted it to be restricted to a ‘dynamic’ Asia in which India did not belong. Perhaps the ‘most valid explanation’ for India’s omission from the summit, according to a journalist, was that the EU’s trade with India was less than the Union’s trade with Singapore (Sharma 1996). Although the Indian application did get support from nations like Singapore, ASEAN’s consensus formula saw it being kept out of the summit.

3 This was agreed by Japanese Prime Minister Ryataro Hashimoto and British Prime Minister John Major at a bilateral meeting on 2 March 1996 on the sidelines of the Bangkok summit. ‘Japan: Hashimoto, Major agree to add more ASEM Members’, Kyoto, 2 March 1996.

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Indian ‘soundings on membership’ had led nowhere (Rana 2009: 67) and ASEM had not ‘felt it necessary to make room’ for it (Haider 2012: 59). Since ASEAN had chosen to confine itself to ‘East Asia’, India objected to this ‘artificial division’ (The Hindu 1996c) and had reportedly demanded that ASEM change its name to the ‘East Asia–Europe meeting’, but it did not succeed (European Report 1996: 1; The Hindu 1996a). The membership agreed to at the Bangkok summit was essentially a ‘minimalist solution’. The ASEM process, the summit urged, needed to be open and evolutionary (Asia–Europe Meeting 1996, 2 March: para 18) with the Asian side insisting that they alone had the prerogative to decide on Asian participation. Italy, which held the EU Presidency at the time, clarified that there was no EU position on this and that the matter should be left open; a position with which the Asian side acquiesced (Serradel 1996: 208). At the inaugural summit, the Europeans advocated the admission of other states that would have joined the Asian side, such as India, Pakistan, Australia and New Zealand—all of which had strong ties with Europe. For some member states of ASEAN, the Commission’s continuous endorsement of their inclusion was a matter of ‘concern’ (Robles 2008: 28; The Hindu 1996e) since they were not too keen on expanding it just yet. Nevertheless, there was broad agreement that new candidates might be approved through ‘a “two-step” consensus or “double-key” approach’ (with an initial consensus within a candidate’s own region, followed by an overall consensus among all partners) (European Commission 1997: 7). India was ‘distressed’ and justifiably peeved and disappointed at being left out of the inaugural ASEM summit (Kelegama 1999; Sridharan 2005: 123). India’s official reaction was not one of disappointment at being excluded from the inaugural summit. ‘It is not the end of the world. India is too large a country to be disappointed’, remarked Finance Minister Manmohan Singh. In fact, he argued that India could be a bridge between East Asia and Europe as it had a ‘better understanding of the Western mindset’ as many Indians had studied or been trained in Europe (Singh 1995). The Times of India described the Bangkok summit as ‘only a meeting of East Asian and West European nations. Neither is all of Asia represented, nor is all of Europe. It is not population but purchasing power that has defined the parameters of the proposed partnership. Even so, the Bangkok Summit ought to be called EAWEM (East Asia and West Europe Meeting), not ASEM’ (The Times of India [editorial] 1996).

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Immediately after the Bangkok meeting, Manuel Marin, Vice-President of the European Commission and Commissioner-in-Charge of EU-Asia relations, spent two days in Delhi (3–4 March 1996), along with the EU Troika, for the ninth round of political dialogue with India. Marin used the occasion to smoothen ‘the sub-continent’s ruffled feathers’ (European Report 1996: 1; Subhan 1996). European Commission President Jacques Santer was expected to provide a first-hand account of the summit to India on his way home from Bangkok, but he cancelled his visit at the last minute. The EU Troika led by Italian Foreign Minister Susanana Agnelli conveyed the message that the ‘comprehensive Asia–Europe partnership’ forged at the Bangkok summit (ASEM, Chairman’s statement at Bangkok summit, 2 March 1996, para 3) would apply to ‘all of Asia, not just to those present at the summit’, and that the ASEM summit seemed incomplete without the participation of India (European Voice 1996, 1, cited in Gaens 2008: 151; Shukla 1996). It was indicated to Indian officials that the EU would be ‘pleased’ to see India take part in future ASEM summits (Serradell 1996: 208).

The Politics of Exclusion The initiative to establish the ASEM process necessitated Asia deciding ‘where it was, and who was in it’. The absence of South Asian states resulted in ‘an exclusionary definition’ of Asia (Breslin 2007: 41) since in Western strategic discourses and in high business circles the definition of Asia basically referred to East and Southeast Asia and did not normally include India. Several Asian countries used this definition ‘to seek to keep India out of regional affairs and entities’ and succeeded, for example, in the case of APEC and ASEM (Gupta 2007: 353). Soon after the Bangkok summit, Malaysia stressed that ASEAN would face ‘the risk of losing its identity’ if non-Southeast Asian states were admitted. While expressing his commitment to open regionalism, Malaysian Foreign Minister Badawi argued that engagement with non-ASEAN countries could be fostered through other means such as bilateral relations and dialogue. He asserted: ‘Obviously, we must draw the line somewhere, I suggest we hold the line in South-East Asia’ (Badawi 1996, cited in Charles 1996). Asian participants in ASEM were trying ‘to monopolize the metaphor [Asia] for themselves, just like the EU has monopolized the term Europe for itself’. At the same time, they implied that Indians are either ‘something other than Asians, or Asians only in a secondary sense’ (Korhonen

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1997: 360). Highly anomalous as it may sound, but in the lexicon of the Asia-Pacific, India did not seem to find a place (Devare 2006: 151). The Union also termed the Asian participation in the new interregional arrangement as ‘Asian ASEM’—a term which Brussels used in its statistics (Gilson 2004: 73; McMahon 1998: 233). As a consistent advocate that the emerging regional architecture in Asia should be open and inclusive, India strongly criticized the narrow definition of Asia supported by the East Asian countries, which reduced Asia’s vast landmass to its ‘Confucian fringe’ or ‘Chopsticks Asia’ (Datta-Ray 1998, cited in Gaens 2008: 151). At the time of the first ASEM summit, Foreign Minister Pranab Mukherjee rightly complained that Asia without India was like Hamlet without the Prince of Denmark (cited in DattaRay 2007: 412). Any summit between Europe and Asia, he pointed out, would be meaningless without India’s presence, given its size, its status as a regional power and its economic strength (The Hindu 1996f). In fact, the ‘Asia’ that was represented at the Bangkok summit was in fact, if not in name, the East Asia Economic Caucus of Malaysian Prime Minister Mahathir. The ‘Asia’ encountered in Bangkok was not only ‘geographically circumscribed’, it was also limited in a sociopolitical sense (Bouissou and Camroux 1996, cited in Camroux and Lechervy 1996: 448).

Deadlock Persists After becoming a full dialogue partner of ASEAN in December 1995, which gave it ‘the privilege and opportunity of wide ranging and allinclusive cooperation’ with it, Foreign Minister Inder Kumar Gujral stated that he looked to it as ‘a window of our progressive participation in other ASEAN-related fora such as APEC and ASEM since it was ‘an inalienable part of the Asia-Pacific economic and strategic zone’. He expressed the hope that India would be involved in the ‘processes’ leading up to the second biennial ASEM summit to be held in London in 1998 (Gujral 1996, in Gujral 1998: 227, 232). Gujral sought to reassure Southeast Asian countries that unresolved issues between India and China would not be brought into Asian organizations. The ‘consistent and declared policy of India’, he reiterated, has been ‘not to raise bilateral and contentious issues in international or multilateral forums’ (Bangkok Post 1996, 23 July). Given India’s size, its geostrategic location and the weight of its economy, he added, ‘we are convinced that any forum claiming to represent Asia cannot be complete

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without India’. He expressed confidence that in view of its ‘excellent relations’ with all ASEAN countries and other Asian members of ASEM as well as all the EU member states, including the UK, the host of the next ASEM summit, India would be invited to participate in ASEM (ibid.). At the time of the Bangkok summit, New Delhi was apparently given assurances by several ASEAN members that it would not be left out of the London ASEM summit. However, at the Senior Officials’ Meeting in Dublin (20 December 1996), it was agreed that neither Asia nor Europe would interfere in each other’s choice of participants. That effectively ruled out Britain or any other EU Member State being able to speak up for an Indian presence at the summit (Velloor 1996). Again, the ‘spoiler’ at the SOM was Malaysia. At the SOM meeting, Kuala Lumpur and Bonn insisted that ASEM should first be consolidated and strengthened before being expanded (ibid.). Mahathir’s opposition was similar to his approach towards India’s inclusion in other fora as well. For instance, during the third week of December 1996 when the Malaysian Prime Minister was in Delhi to receive the Nehru Award for International Understanding, he ‘hummed and hawed’ when asked if Malaysia would support India’s application to enter APEC (Asia-Pacific Economic Cooperation) (ibid.). ASEM enlargement, Brussels noted, was ‘inevitable, but not immediately possible’ by the London ASEM summit since the Asian side was unable to reach a consensus on either the procedure or which countries among the ‘frontrunners’ (India, Pakistan, Australia and New Zealand) should be actually considered. One had to be ‘very mindful’, a senior EU official even cautioned, of how one proceeded because that could ‘easily almost double the size of ASEM’, which could even look ‘more like the UN General Assembly’, which would be very difficult to work (Westerland 1997 in Kim and Park 1998: 175–176). The European Parliament continued to be supportive of Indian membership of ASEM. It regarded the case for including countries like India, Australia and New Zealand to be strong and urged the Union ‘to see what it could do to facilitate such an enlargement in the future’ (European Parliament 1997). The European Commission urged that the numerical imbalance in ASEM (fifteen EU and ten Asian countries) needed to be redressed by increasing the Asian participation. There was widespread recognition that any decision on enlargement was ultimately ‘a political decision’ (European Commission 1997: 8). In the absence of a consensus among Asian participants on the inclusion of more Asian countries, the issue was postponed for the second ASEM summit.

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India lobbied hard both within ASEAN and the EU for inclusion in ASEM 2. It would be difficult, Britain pointed out, to conceive of an Asian organization without India. New Delhi’s inclusion could be finalized only by consensus among member nations, but it was not a matter which needed to be ‘resolved immediately’ (Business World 1996, 16 April: 2; The Statesman 1997, 14 February). At the first ASEM Foreign Ministers’ Meeting in Singapore (15 February 1997), it was agreed that no one had an automatic claim to membership and that the founding fathers of ASEM would have to adopt rules to justify their choices for future membership (Fatchett 1999: 15; Godement 2000: 204). After the conference, Malaysian Foreign Minister Abdullah Ahmad Badawi again urged patience: ‘It is not that we are against the admission of more countries into ASEM. It is simply a question of time … let us firm up first before expanding’ (New Straits Times 1997, 15 February). Japan and several Southeast Asian countries advocated the inclusion of Australia and New Zealand in the next summit for geographic and economic considerations, but were reticent about India. Other Asian members of ASEM also preferred that the original composition of the interregional organization be maintained, especially as it was ‘a very new forum’ which need time to develop and strengthen (Business Times 1977, 1 May: 4). Even among the Europeans, there were some who wanted to see India take part in the London summit in the light of its political and economic importance in Asia and in order to redress the numerical balance in favour of the Europeans. Since opinion was divided on the issue of new members, it was decided to postpone a decision on expanding membership after the London ASEM summit. Enlargement became an extremely controversial issue over the admission of Myanmar (which became a member of ASEAN in July 1997) owing to the EU’s boycott of its inclusion because of the military junta. Since its own members (Laos, Cambodia and Myanmar) were not being accepted in ASEM, ASEAN countered that it would oppose the admission of new EU members in view of the impending enlargement. This resulted in a de facto moratorium on new membership until 2004 as successive Foreign Ministers’ meetings failed to resolve the deadlock. ASEM 2 (London, April 1998) The second ASEM summit (London, 3–4 April 1998) failed to come up with a consensus on either the timing, criteria or modalities regarding

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enlargement. A decision was deferred until ASEM 3 probably because the question of increasing the Asian side was probably too contentious (Holland 2002: 73). The Chairman’s statement of ASEM 2 stated that ‘enlargement should be conducted on the basis of consensus by the Heads of State and Government’.4 The Asia–Europe Cooperation Framework endorsed at ASEM 2 mentioned enlargement in passing and failed to define any criteria for membership. It merely reiterated that ASEM should be an open and evolutionary process and that enlargement should take place on the basis of consensus. At the end of the summit, Prime Minister Mahathir stood steadfast in his opposition to admitting Australia and New Zealand into ASEM, saying priority should be given to India and Pakistan. However, in the same breath he stressed that the two-year old, 25-nation grouping ‘must first produce results before considering expansion’ (AFX News 1998, 6 April: 1). Many Southeast Asian countries apparently came to the conclusion that Indian interest in joining either APEC or ASEM had waned somewhat given the sharp differences over the admission of Myanmar and because New Delhi was preoccupied with its nuclear security doctrine and a related dialogue with Washington (The Hindu 1999b, 15 February: 1). Moreover, between ASEM 1 and ASEM 2, support for Australia and New Zealand declined perceptibly and the issue of admission of India and Pakistan ‘receded into the background’ (Robles 2008: 22). With a growing sense of ASEM’s unimportance, according to one perceptive observer, India’s ‘lobbying fervor diminished significantly’ (Camroux 2006: 12). ASEM 3 (Seoul, October 2000) In March 1999, the European Parliament again urged both the Council and the Commission to ‘help’ India join the ASEM process, which could only benefit from the weight of Asia’s largest democracy and its economic potential. However, the following month, the Committee on Foreign Affairs, Security and Defense Policy of the European Parliament concluded that it would be ‘premature’ to admit new members given the major differences among the existing ASEM participants, that the case for including countries like India, Australia and New Zealand was strong and 4 See Introduction of the Chairman’s Statement: The Second Asia–Europe Meeting, London, 3–4 April 1998.

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urged the EU to see what it could do to facilitate such an enlargement in the future (European Parliament 1999: 14). Senior European bureaucrats in DG1B, which was headed by Commissioner Manuel Marin and dealt with South and Southeast Asia, seemed to have had difficulty in integrating its agenda in the ASEM process. For instance, DG1B generously financed two major meetings, such as the Europe–Asia Forum on Culture, Values and Technology (Venice, 18–19 January 1996) and the Europe–Asia Forum in Manila (1998) as a cultural dialogue between Asia and Europe. Both these meetings had a significant input from Indian specialists but the conclusions were largely ignored in the ASEM process because of the inclusion of non-ASEM members (Camroux 2002: 147, 2006: 7). The continuing ‘numerical imbalance’, a Working Document of the Commission on ASEM (April 2000) argued, suggested that the priority for ASEM enlargement should rest with ‘major candidates on the Asian side’ (European Commission 2000). Three months later, Commissioner for External Relations Chris Patten expressed the hope that ASEM 3 would tackle the issue of enlarging its membership to include other Asian partners, including those outside East and Southeast Asia (Patten 2000a). Two days before the Seoul summit, Patten again argued that the ASEM was not ‘the sum total’ of Europe’s relationship with Asia and there were ‘important Asian countries, with thriving democracies and economies— and I think above all of India—who are not a part of it’ (Patten 2000b). Endorsing this, the European Parliament urged that India, ‘one of the most important democracies in the world’, ought to participate in the ASEM process, within ‘a reasonable time-frame’ (European Parliament 2000; emphasis added). At ASEM 3, no progress was made on extending membership beyond the existing principle of each side determining its own composition. Thus, the EU’s wish to see India included was thwarted and Asia’s (specifically Malaysia) response to incorporating Australia or New Zealand was that ‘membership would have to be through the EU half of ASEM!’ The only concession was that ASEM non-members were allowed to participate in common ASEM projects (Holland 2002: 74). Even Singapore’s efforts to bring India into the Asia Europe Foundation were being blocked (Koh 1998). East Asian states, The Hindu editorially noted, were ‘dragging their feet’ over enlargement in order not to dilute attention at this stage and because of the Pakistan factor. It was up to India, it added, to

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convince its eastern neighbours that it could ‘add value and substance’ to ASEM (The Hindu 2000, 28 October). ASEM 3 approved the ‘Asia–Europe Cooperation Framework 2000’ which enumerated the principles governing future participation. It stated that the ASEM was an ‘open and evolutionary’ process and enlargement should be conducted in ‘progressive stages’. Each candidacy, it said, should be examined on the basis of its own merits and in the light of its potential contribution to the ASEM process. It adopted a two-key approach: a final decision on new participants would be made by consensus among all part-ners only after a candidate has first the support of its partners within its region. Thereafter, any decision regarding the admission of new participants would be taken by the Heads of State and Government on a consensus basis. (‘VI. ASEM Participation’, Asia–Europe Cooperation Framework 2000, para 28)

Thus, a candidate’s application had to first receive the ‘blessings’ of the ASEM members in the geographical group to which it belonged, before it could be considered by all the ASEM heads of state and government. A European Commission Vademecum (July 2001) noted that since no decision on enlargement could be taken before ASEM 4 in Copenhagen (September 2002), there was no need to take a discussion on substance until nearer the summit (European Commission 2001a, point 7). In its revised Asia strategy—‘Europe and Asia: A Strategic Framework for Enhanced Partnerships’ (4 September 2001)—the Commission urged ‘a stronger integration of South Asia within the broader Asian regional (for example through a broadening of Asian participation in ASEM)’ (European Commission 2001b: 20–21). Thus, an agreement on the pace and procedures for enlargement continued to be elusive. Even in 2002, former Commission President Jacques Santer had expressed his frustration over the refusal of China, Thailand and Vietnam to let India and Pakistan to join ASEM (European Voice 6 June 2002, cited in Gaens 2008: 151). ASEM 5 (Hanoi, October 2004) The deadlock over the admission of Myanmar persisted until ASEM 5 in Hanoi in 2004. Brussels sought to include the 10 new member states, which had joined the Union in May 2004, at the summit. However,

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ASEAN refused to allow this unless the Union agreed to the inclusion of its three new members (Cambodia, Laos and Myanmar). A month before the Hanoi summit (September 2004), EU Foreign Ministers agreed that Myanmar could attend the summit, but they also imposed additional sanctions on it. Thus, at the fifth summit, ASEM had admitted 13 new members—10 EU and three ASEAN states, but even now India was not invited to join even though annual India-ASEAN summits had been held since 2002. All that Brussels could do was to note India’s ‘aspiration to become as early as possible a member of ASEM to complement its ASEAN Summit level dialogue status’ (European Council 2004).

Membership at Last With the impending accession of Romania and Bulgaria on 1 January 2007, the Finnish Presidency started negotiations on ASEM enlargement at an early stage, but the Asian members of ASEM only reached a decision on ‘Asian ASEM’ enlargement during the ASEAN Plus Three Foreign Ministers Meeting in Kuala Lumpur on 26 July 2006. The Meeting agreed to the inclusion of three Asian countries, such as India, Pakistan and Mongolia, provided the new members became part of the Northeast Asian coordinating mechanism and that the ASEAN Secretariat was allowed to join as a partner (Gaens 2008: 150). Several observers maintain that this seems to have been almost a ‘last minute decision’ (Pereira 2007: 17) and was largely ‘unexpected’ (Camroux 2006: 31). However, the consensus is that after the admission of 13 countries (three Asian and ten European) in 2004, the decision of ASEM 6 to admit India, Pakistan, Mongolia and the ASEAN Secretariat, ‘no longer’ allowed controversies (Robles 2008: 29). After the EU’s positive reaction, the Senior Officials Meeting on the eve of the Helsinki summit agreed on the inclusion of the European and Asian candidates. The leaders officially endorsed the candidates during the ‘Future of ASEM’ session at the summit, and the new partners were officially invited to join the process during the summit’s closing ceremony (Gaens 2008: 150). On receiving a formal invitation from the AsianASEM Coordinators (China and Brunei), India accepted membership of the 45-member group of ASEM. Asian members of ASEM consist of 10 ASEAN members and a subgroup called North, East and South Asia (NESA) comprising six countries (China, India, Japan, Mongolia, Pakistan and South Korea). When

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it joined, India became the coordinator5 (2008–2010) of NESA, which rotates on a two-year term whereas the other one (ASEAN) was rotated on a three-year term. The sending of one of the Secretary (East), Ministry of External Affairs, was ‘a very good signal that India means business’.6 The admission of Pakistan was ‘a logical or unavoidable extension’ of India’s participation in ASEM (Godement 2000: 205; Gaens 2008: 150). The admission of six new countries (India, Mongolia, Pakistan, Bulgaria and Romania) and the ASEAN Secretariat at ASEM 7 in Beijing (October 2008) brought the membership up to 45 partners, together representing half of the world’s GDP, almost 60 per cent of the world’s population and over 60 per cent of global trade. ASEM enlargement at the ASEM 6 provided ‘greater dynamism, enhances dialogue and cooperation’ and made the ‘partnership better equipped to tackle present and future global challenges’ (Helsinki Declaration on the Future of ASEM, 2006). India’s participation was expected to further increase the ‘representativeness, dynamism and innovative character of the ASEM process’ (European Commission 2006). Without Indian membership of ASEM, the EU’s engagement of Asia would have been ‘incomplete’ (Singh 2006). Kishore Mahbubani characterized ASEM enlargement at the Helsinki summit as an ‘effort to revive the ASEM process’ (Mahbubani and Jayme 2008: 30–31).

Misplaced Criticism of Indian Membership Since the establishment of ASEM, there has been a debate over India’s admission in ASEM among European and Southeast Asian scholars with most of them being critical of New Delhi’s admission in the interregional organization.

5 There are four coordinators of ASEM—one each for the European Union and European Commission (which do it jointly) and ASEAN and NESA on the Asian side. The four Coordinators hold regional meetings among their respective groups followed by a special meeting of the four coordinators to put things together before the summit. They agree on a draft after consulting all other members—which is the combined wisdom of the four Coordinators—will be discussed who have in turn consulted all their members. But even so, individual countries would then be free to comment later. ASEM, therefore, works through the European and the Asian sides coordinating among themselves through their respective Coordinators. Reddy 2010. 6 Conversation with ASEM Director, European Commission, 10 December 2008.

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The official, formal reason for excluding India, according to a former Indian Foreign Secretary, was that if it joined ‘the skullduggeries’ of Indo-Pak relations would come in (Dixit 2000: 87). It was feared that admission of India and Pakistan would lead to a spillover of South Asia’s conflicts and rivalries and ‘burden’ ASEM with their bilateral problems (Rueland 2001: 68). Till the late 1990s, there were stated to be ‘strong fears’ in the Asian camp that their admission would paralyse ASEM as both might be tempted to use the grouping as a stage for their protracted conflict over Kashmir (Rueland 1999: 129). Several ASEAN member states and scholars argued that any further expansion of ASEM would make it truly unwieldy and incapable of producing any meaningful results (Rueland 1999: 127–128). A premature extension was to be avoided since ASEM had not yet consolidated as an institution and had been weakened by the Asian financial crisis. ‘Bringing in new members at this point—especially from South Asia—is the last thing an already highly fragile forum can shoulder. It would only burden ASEM with an additional set of tricky problems, thus further eroding the forum’s weak cohesion’ (Rueland 1999: 129, 2001: 68). Many scholars asserted that priority ought to be given to consolidation of ASEM rather than an early enlargement, which would make it prone to inertia and inefficiencies (Godement 2000: 204; Hwee 2003: 170; Rueland 1999: 127–128, 2001: 68). Criticism of Indian admission increased in the wake of the nuclear tests by India and Pakistan (1998) (Rueland 1999: 129, 2001: 68). One scholar even suggested that admission of South Asian nations to ASEM ought to be linked to a prior accession to the Comprehensive Test Ban Treaty (Nutall 2000, cited in Rueland 2000: 192). Some even feared that due to its size, India might take the centrestage in ASEM’s dialogues and that Indian membership could lead to ASEAN losing its centrality in ASEM (Holland 2002: 73; Reiterer 2001: 26). Medium-sized and small Asian members were apprehensive that the inclusion of another 1.4 billion people from India and Pakistan would ‘drown their voices and living about a shift in balance of power’ (Hwee 2002). One EU official even advocated a ‘separate arrangement’ between South Asia and the EU (Reiterer 2001: 26). Gilson highlighted the differences between East and South Asia, which the EU Asia Strategy (2001) itself noted was ‘distinct from the rest of Asia’ (European Commission 2001b: 9). She argued that the EU pursued ‘a donor-recipient format’ for South Asia given its level of development

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and a graduated status for Southeast Asia as part of a wider regional grouping of East Asia. In this way, she added, the explicit nature of the region as part of an interregional framework might serve to reinforce further differences between East and South Asia (Gilson 2005: 319). For an EU official, the 2006 ASEM enlargement tended to confirm the dialogue character of ASEM and South and Central Asia, which remained ‘two distinct regions only loosely connected to East Asia’ (Reiterer 2009: 187–188). Since the 1990s as India began to woo its Asian neighbours and stepped up its diplomacy to become a member of regional organizations, Beijing has sought the strategic exclusion of external players like India (Kavalski 2009: 89). When India was invited to join the ASEAN Regional Forum in 1996, China was ‘non-committal and its support, at best was lukewarm parity driven by a desire not to be isolated’ (Ram 2012: 71). Chinese objections to Indian membership of regional organizations like ASEM and the Shanghai Cooperation Organisation (SCO) have been largely political and strategic in nature. Even Members of the European Parliament felt that China was ‘not what one would call hospitable’ on the question of Indian membership of ASEM (Belder 2001). On the other hand, some academics argued that ASEM could help in integrating ‘great powers’ like India and Russia into regional communities so that they could be ‘more actively engaged in their respective regions. While their involvement may have drawbacks as well (their presence may constrain the scope of discussions and co-operation), on balance the positive aspects of involvement’ seemed more important (Maull and Tanaka 1997: 25). In the wake of the 11 September 2001 events, a veteran observer of ASEM urged that the protracted campaign against terrorism should make one ‘re-examine seriously’ the idea of especially including India and Pakistan into the ASEM framework (Hwee 2002: 7–15). The diverse level, intensity and interests of Southeast Asian members in the ASEM process conditioned their practical scope and conceptual input. Singapore, Thailand, the Philippines and Vietnam were more interested in ASEM than Malaysia, Indonesia or Brunei Darussalam (Bersick 2002). Despite active support of several member states like Singapore, the inability to arrive at a consensual position within ASEAN delayed India’s inclusion in ASEM. The exclusion of India from the ASEM process was, for long, the result of ‘the growing dominance of the exclusionist position’ which Malaysia was able to enforce amidst the consensus-seeking diplomacy of East Asia (cf. Wesley 1997: 530). While Indian lobbying

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did apparently succeed in whittling down opposition to India’s inclusion in ASEM in several ASEAN member states, but even New Delhi’s more ardent supporters were not willing to break East Asian solidarity for India’s cause. Thus, enlargement of ASEM was made contingent on the emergence of a deeper consensus on broadening of membership. Apprehensions that India might take centre-stage in ASEM proved unwarranted as New Delhi has historically preferred ASEAN to be in the driver’s seat and deferred to it as the leading architect of the institution-building in the region. India’s enhanced integration with the Asia-Pacific region has, in fact, been facilitated by a closer understanding with ASEAN, the crucial support of countries like Singapore and Japan, and concerns about China’s growing assertiveness. Indian membership has also not burdened the interregional organization with contentious South Asian issues as New Delhi has assiduously striven to keep them out of international fora. In fact, because of peer pressure, a country cannot stick to its bilateral agenda. Moreover, that ASEM continues to remain a forum for broad dialogue rather than problem-solving has nothing to do with Indian membership as many critics contended, but with what the interregional forum has become over time.

India’s Engagement with ASEM India has been an active participant in ASEM since its admission in 2007. New Delhi perceives ASEM to be a valuable forum since twelve ASEM countries figure among its top 25 trading partners. ASEM has also proven of great value in enhancing India’s bilateral and multilateral cooperation as well as being a platform for informal dialogue on topical issues. For India, ASEM offers an additional channel of communication with the added value of high-level participation, informality and multidimensional activities. ASEM Foreign Ministers’ Meeting, New Delhi, 2013 The first time that India hosted a ASEM Foreign Ministers Meeting was in New Delhi in November 2013. At this meeting, India took several initiatives. It pushed for ‘result-oriented initiatives’ by agreeing to work with like-minded ASEM members in areas with potential for tangible cooperation. This was in an effort to move ASEM beyond ‘a declaratory political dialogue, towards tangible deliverables and concrete action

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in a more determined manner’ (Khurshid 2013). This was expected to add to the ‘relevance and vitality’ of ASEM (Ansari 2013) and take it to ‘the next level of maturity’ (Akbaruddin 2013). At the New Delhi FMM, twelve areas were identified for tangible cooperation. In each area, multiple countries had expressed interest in identifying specific initiatives for enhancing cooperation in that area. India expressed its interest in working with interested ASEM members in sustainable water management, energy efficiency technologies, disaster mitigation and response, vocational and skills training and education and human resource development. At the Milan ASEM summit (2014), the list had increased to 16, including ‘Technologies for Diagnostics’ proposed by India. At the summit, New Delhi committed itself to ten specific initiatives as part of this endeavour and expected ASEM members to join these initiatives without financial obligations. By the Ulaanbaatar summit (July 2016), this list had increased to 19. At the summit, India proposed the twentieth tangible deliverable of youth exchanges to mark 20 years of ASEM. The New Delhi ASEM FMM sought to bring about three major changes. The Ministry of External Affairs claimed that it brought about ‘significant forward movement’ in ASEM working methods, including a Chair’s Statement based on consensus and consultations, a shift from ‘dialogue’ to ‘deliverables’ and the inclusion of the ‘constructive format’ of the Retreat to facilitate in-depth exchange of views on international and regional issues (Ministry of External Affairs 2014: xiii). While the MEA claimed that the Foreign Ministers meeting marked ‘the beginning of a new orientation in ASEM to seize opportunities for tangible cooperation’ (ibid.: 120), this was not the case. The retreat format was first applied at the third ASEM FMM in 2001 and for the first time at the summit level during ASEM4 (2002) (Gaens 2018: 23). In fact, India re-introduced the retreat format, which was also adopted in the subsequent summits in Milan (2014), Ulaanbaatar (2016) and Brussels (2018). India’s idea of ‘tangible cooperation’ of like-minded states, which was in the past referred to as issue-based leadership at the ASEM summit in Helsinki (2006) and the one in Brussels (2010), was not followed up subsequently. India’s suggestion that it be the norm for the Chair of any Foreign Ministers Meeting or summit to report on progress under tangible cooperation (Singh 2014) has not been taken on board. There is no evidence of a smaller group of five or six like-minded countries jointly working on a defined set of issues and areas (Berkofsky 2018: 70).

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Indian Initiatives In order to enhance cooperation among ASEM member states, New Delhi has hosted a number of workshops and roundtables and co-hosted a number of events with the Asia Europe Foundation. At the tenth ASEM summit (2014), India committed to ten specific initiatives under the areas identified for tangible cooperation regarding energy efficiency, biotechnology and life sciences, disaster management and water management to be organized during 2014–2016.7 These have included the ninth Asia Europe Foundation Journalists Colloquium (November 2013) and the two-week on ‘Sustainable Urbanization in Heritage Cities’ (2014). As a member of the ASEM Working Group on Press and Public Awareness Management Strategy, India hosted three Foreign Policy Modules for ASEM diplomats at the Foreign Service Institute, New Delhi in March 2015, June 2016 and July 2017. New Delhi also hosted more than half a dozen other workshops, conferences, including ASEM Customs Directors General/Commissioners (2015), Youth Dialogue (2016) and monument conservation (2017) (Ministry of External Affairs 2017).

Media and Elite Perceptions of ASEM ASEM has not attracted much coverage in the Indian print media. There was not a single item on ASEM in any of the three newspapers–The Times of India, The Economic Times and Dainik Jagran (the most widely read national language (Hindi) newspaper over a six-month period (1 July–31 December 2008) (Jain and Pandey 2010: 195). The daily coverage of the EU in the selected dailies was observed over a period of six months (from 1 July to 31 December 2009). A total of 235 news items about the EU were identified after scanning these dailies. This is by no means a sizeable volume of reportage. There was not a single news item on the ASEM process in the six-month period even though

7 These included (1) First ASEM Roundtable on ‘Energy Efficiency in Green Buildings’ (Hyderabad, 5 September 2014); (2) Second ASEM Roundtable (Gandhinagar, November 2015); (3) an ASEM Workshop on ‘Cooperation between Asia and Europe in Life Sciences, Pharmaceuticals, Biotechnology and Medical Devices Sector’ (New Delhi, 20 November 2014); (4) a Roundtable on ‘Innovations in Technologies for Disaster Rescue Efforts amongst ASEM countries’ (New Delhi, 4–5 December 2014); (5) a Workshop on ‘Towards Efficient and Sustainable Water Management through partnership amongst ASEM Countries’ (New Delhi, 27 February 2015) (Singh 2014).

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India had been participating in the process since 2008. However, the low coverage of the EU was not a totally unexpected result, for it is widely known that national and local events and politics remains the primary focus of the Indian news media (Jain and Pandey 2014: 388). A total of 38 Indian stakeholders were interviewed to gauge their perceptions about the European Union. Of these, eight were former/present members of the Lok Sabha and the Rajya Sabha as well as former ministers, ten were affiliated to big businesses, ten belonged to civil society, and the remaining ten were media elites. Almost two-thirds of ‘elites’ across all categories admitted their ignorance of the ASEM process as well as the 2008 ASEM summit held in Beijing. Many pointed out that India had been one of the late entrants to the ASEM process; consequently, ASEM had not yet succeeded in grabbing the attention of the Indian media and remained a low-key affair. Some regarded ASEM as a positive process seeking to bring Asia and Europe together and enabling India to engage within an Asian framework with and within Europe. However, one civil society representative felt that ASEM had a long way to go before it caught up with regional organizations like the Association for South East Asian Nations. It was felt that ASEM had not emerged as an effective platform since it had not succeeded in resolving any long-standing problem. A former Union Minister felt that ASEM is a ‘diplomatic sideshow with no real content’. Some felt that ASEM needed to become more visible to enable the average Indian to understand the importance of the EU in the Indian as well as Asian context (Jain and Pandey 2014: 398–399). Overall, ‘elites’ felt that ASEM should be given more time to establish itself and prove its utility. During this period, awareness of the ASEM process was found to be extremely low primarily because India became a member only recently. During elite interviews conducted in 2011–2012, opinions did not seem to have changed much with ‘no publicity’ in the Indian press about the Brussels ASEM summit (October 2010). A senior editor of a leading newspaper described ASEM as ‘a good talk shop. .. just a talk show’ (Interview, 28 March 2012). One well-informed media elite said India had started taking ‘great interest only recently’ and India took positions on several issues and started playing ‘a very active role’ during the Brussels summit (2010) in contrast to earlier perceptions of being somewhat passive. There was not much media reporting on it. Another media elite also termed it as ‘just another talking shop’ and did not recall if anything of importance happened at the Brussels ASEM summit (Interview, 5

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February 2012). Thus, there is weak visibility and public awareness of ASEM. It is difficult to enhance the relevance of ASEM since it essential remains an informal forum for dialogue and discussion and neither makes any concrete policies or decisions which directly have an impact on citizens of member states. Nevertheless, New Delhi maintained that ASEM’s informality and its main function as a dialogue forum had to be retained even though concrete functional projects should be pursued in order to enhance ASEM’s relevance.

Connectivity In recent years, connectivity has become the buzzword around which numerous things are sought to be organized. Connectivity in ASEM, India maintains, should not only be geographic, but also mean connectivity of institutions, systems and people-to-people linkages (Singh 2014). At ASEM 11—’20 Years of ASEM: Partnership for the Future through Connectivity’—Vice-President Hamid Ansari noted that connectivity is an enabler—for development, for improving the quality of life of people, for encouraging greater people-to-people exchanges, for stimulating trade and investments, and indeed for building peace, stability and security. ‘Physical connectivity’, he added, was ‘merely the means to meeting the aspirations of our citizens; to building mutually beneficial partnerships, and to collectively addressing our regional and global challenges. The networks of connectivity that we build must be all-encompassing— not merely physical. It must also include institutional, digital, economic and socio-cultural aspects’ (Ansari 2016). Connectivity initiatives must meet universally recognized international norms such as respect for sovereignty and territorial integrity (Naidu 2018).

Importance of ASEM India considers ASEM to be ‘a unique framework’ which brings Asia together with Europe on one platform for cross-continental dialogue and cross-fertilization of ideas on a wide range of topical issues. It ‘adds value’ to ongoing processes in other multilateral frameworks. It not only offers a platform for informal dialogue on topical issues but also helps to shape the international policy agenda (Reddy 2010; Khurshid 2012). India valued ASEM as ‘a platform that brings together leadership of Asia and Europe to exchange views and address global challenges’ (Naidu 2018).

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ASEM has a number of benefits for India. Firstly, membership of ASEM was part of its proactive engagement with East and Southeast Asia, which gradually enabled it to become an active participant in Asian regional organizations and multilateral processes (Jain 2011). This was part of it proactive quest for membership of regional and interregional institutions since the 1990s and overall approach that multilateral institutions should be open and inclusive. After being at the periphery for decades, India’s constructive, proactive and purposeful engagement with East and Southeast Asia with its Look East Policy reversed decades of neglect of the region. India has found some regional groups to be ‘more active and more purposeful than others’. New Delhi considers it necessary to participate in ‘any major regional group where leaders from other major countries in Asia are participating. India cannot be seen as not participating in those groups. And where we see there is a value to India, where our voice will be heard, where what we say matters, I think we should participate in these regional groups’ (Reddy 2010). Secondly, India maintains that ASEM is ‘a powerful forum’ (Singh 2008) to deal with global issues and present India’s perspective and priorities on issues like terrorism, which has been a recurrent theme in various ASEM fora from the first ministerial participation in ASEM Foreign Ministers’ meeting attended by Foreign Minister Pranab Mukherjee in Hamburg (May 2007). It offers ‘unique opportunities’ to bring about greater focus on areas of relevance for developing countries and emerging markets (Krishna 2011). Thirdly, it facilitates access to European and Asian leaders and officials and offers opportunities to arrange both bilateral and multilateral meetings on the margins of various ASEM fora. Bilateral meetings on the sidelines of the biennial ASEM Foreign Ministers, other ministerial meetings and ASEM summits are important for most members including India. Three bilaterals (Presidents of Mongolia and Bulgaria and Italian Prime Minister) were held at the seventh Beijing summit (2008) and the eighth Brussels summit (2010), viz. President of the European Council and the Prime Ministers of Belgium and Malaysia). At the ninth ASEM summit, Foreign Minister Salman Khurshid had nine bilaterals while Minister of State for External Relations V.K. Singh met the Prime Ministers of Thailand, Estonia and Slovenia at the tenth summit in Milan. The bilaterals have been more numerous at ASEM Foreign Ministers’ meetings. At the Hamburg FMM (2007), Foreign Minister Pranab Mukherjee had meetings with the Foreign Ministers of Vietnam, Poland,

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CFSP High Representative Javier Solana and a ‘chat’ with the Pakistani Foreign Minister. For instance, at the Delhi Foreign Ministers Meeting in November 2013, more than 100 bilateral meetings were registered (Khandekar 2018: 161). Minister of State for External Affairs V. K. Singh met 11 Foreign Ministers, including ten from member states of the European Union at the twelfth Luxembourg Foreign Ministers Meeting (November 2015). India was represented at the highest level only at the first summit soon after its admission when Prime Minister Manmohan Singh led the Indian delegation to the seventh ASEM summit in Beijing (October 2008). However, no Prime Minister participated in any of the four subsequent four summits. Vice-President Hamid Ansari led the Indian delegation to two ASEM summits (Brussels 2010 and Ulaanbaataar 2016) and VicePresident M. Venkaiah Naidu participated in the twelfth summit (Brussels 2018). Prime Minister Manmohan Singh was unable to participate in the Brussels summit as he had obligations concerning the Commonwealth Games that were being hosted in New Delhi and the timings were coinciding. Foreign Minister Salman Khurshid participated in the ninth ASEM summit in Vientiane (2012) and the Minister of State for External Affairs V. K. Singh at the one in Milan (2014).

Conclusion After being at the periphery for decades, India’s constructive, proactive and purposeful engagement with East and Southeast Asia since the 1990s has gradually transformed it into an active participant in Asian regional organizations and multilateral processes. The Look East Policy, which was premised on emerging and shared strategic, defence, economic, cultural and socio-economic convergences between India and Southeast Asia, reversed decades of neglect of the region. It undeniably played a transformative role in enhancing India’s profile in Asia and opened the doors for Indian membership of regional organizations like the East Asian summit and ASEM. ASEM, according to a senior official of the Ministry of External Affairs, was initially seen as ‘an initiative to complete the missing part’ of the three engines of the global economy—America, Europe and Asia. It was also perhaps motivated by fears of a protectionist movement in Europe and the European reaction to APEC which they were not part of. ASEM was

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therefore perceived as a forum that could eventually develop to include both regions (Reddy 2010). ASEM’s membership has more than doubled from 26 (15 EU member states, 7 ASEAN member states plus China, Japan, Korea and the European Commission) in 1996 to 53 today (30 European, 21 Asian countries, the European Union and the ASEAN Secretariat). In the process it has become a far more diverse and heterogeneous interregional grouping with a focus on intergovernmental and bilateral relations with a strong emphasis on consensus in decision-making. However, since its inception, ASEM’s institutional design, core philosophy, working methods and general objectives have not changed dramatically (Gaens 2018: 15). Initially, ASEM’s goal was to foster trade, economy, investment and not get embroiled in ‘sensitive’ political issues. In the 2000s, political and security-related issues increasingly became a focus of attention. With the onset of the global financial crisis of 2007–2008, sustainable development and non-traditional security became a focus of attention. In over a decade-and-a-half of its membership of ASEM, India has become an active participant and contributor in ASEM events, discussions and activities. New Delhi increasingly perceives ASEM to be a valuable forum. ASEM has also proven of great value in enhancing India’s bilateral and multilateral cooperation as well as being a platform for informal dialogue on topical issues. For India, ASEM offers an additional channel of communication with the added value of high-level participation, informality and multidimensional activities. Indian policy-makers are however conscious that ASEM has not been able to contribute ‘anything much’ to the alleviation of topical problems (Haidar 2008). Numerous policy recommendations made over the years at Track II ASEM meetings, workshops, seminars and publications have been presented to policy-makers, but only ‘a very few have made it on to the ASEM working agenda or have resulted in actual ASEM policies’ (Berkofsky 2018: 67). India regards ASEM as a significant interregional organization where as a major Asian country its presence is essential given its Look East and now Act East policy. New Delhi deems it important to participate in a major regional group like ASEM ‘where leaders from other countries in Asia are participating. India cannot be seen as not participating in those groups’ (Reddy 2010). For India, a major benefit of ASEM has clearly been in bilaterals on the sidelines of its meetings, especially with those countries with which the degree of political engagement and interaction is either limited or shallow. India actively engages ASEM in its diverse network of

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activities across its three pillars. New Delhi has however participated at the prime ministerial level in only one of the five summits so far since its admission in 2007. The USP of ASEM has, in fact, been its capacity to discuss a wide variety of regional and international issues in an informal setting. It serves the purpose of an incubator of ideas, as a vehicle to foster convergence of views, works on consensus as there is no voting, and has the format of an issue-based leadership. Indian efforts to enhance ASEM’s relevance by fostering more tangible cooperation, including as a forum for the exchange of best practices, for developing countries and emerging markets have so far not met with much success largely because member states seek to stringently maintain its informal character and avoid deeper institutionalization. Even after two-and-a-half decades, ASEM remains a forum for broad dialogue rather than problem-solving or practical cooperation.

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CHAPTER 6

India, Europe and Connectivity: From Shared Views on BRI to Mutual Cooperation? Manasi Singh

Introduction In an increasingly globalized and networked world, nations are competing to improve geographical connectivity and seek benefits from enhanced political and economic cooperation. China’s expanding continental and maritime footprint has caused enough anxiety among the major powers of the world. Its flagship connectivity drive, the Belt and Road Initiative (BRI) has committed heavy investments in infrastructure development projects to deepen economic integration across continents. While India has strongly resisted BRI for violation of sovereignty, the European Union is also critical of the project considering the growing Chinese geopolitical influence in its neighbourhood. Moreover, the US trade protectionism has compelled EU to deepen its engagement in Asia and collaborate with like-minded partners. It is keen to strengthen connectivity between the two continents to tap Asia’s economic potential and promote investments in vital sectors like digital, telecom, transport and

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energy. The EU Strategy on Connecting Europe and Asia (2018) emphasizes a rules-based, transparent and sustainable connectivity model. In this context, India comes across as an important regional and global partner for shaping new norms related to connectivity projects. The November 2018 EU’s Strategy on India underlines this aspect and calls for intensifying coordination with India on geostrategic issues. Given Europe’s long and rich experience of connecting states and regions, India can explore prospects of mutual cooperation with Europe and strengthen dialogue. The chapter analyses India and EU’s perspectives on geo-economics and the new Eurasian great game. It explores avenues for cooperation based on their shared values and interests, to improve connectivity between Asia and Europe.

Connectivity and Geo-Economics: The New Leitmotifs Connectivity and geo-economics have become very relevant in contemporary policy-making. Connectivity is now seen as a key driver of foreign policy in order to tap the potential advantages of linking cities and regions. The realization also stems from the geopolitical shifts and rapid transformation in the economic landscape of the world. The Asia-Pacific has become a potential force in terms of trade patterns, technological progress, infrastructure investment, private consumption, accumulation of labour and capital (Kemp et al. 2016: 12). For Europe, American trade protectionism and Brexit has led it to more vigorously engage emerging economies in order to diversify its markets. It is therefore a strategic imperative for states to secure global flows of finance, goods, information and people, given the level of interconnectedness and the related vulnerabilities (Scholvin and Wigell 2018). Countries like China and Russia are leveraging economic statecraft to gain influence across the world (Holslag 2016; Vihma and Wigell 2016). The term ‘geo-economics’ which refers to the use of economic power to pursue strategic aims is therefore gaining traction in international relations (Wigell et al. 2018). The term was first used by Edward Luttwak in 1990 to capture how capital and market penetration became a major arena for rivalry between states instead of military competition (Luttwak 1990). The Cold War had obstructed connections and connectivity, however, the fall of iron curtain unleashed opportunities for accelerating

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the pace of globalization. Greater links were established across continents as a result of burgeoning trade, communications and technology (Leonard 2016: 14). Looking back into the history, all major cities were located along a waterway (Glaeser and Kohlhase 2003) and eventually became important trading centres and crucial nodes facilitating the flow of goods, money and information. Thus, in an ever-growing interdependent world, enhanced connectivity provides access to resources, greater mobility, thereby opening prospects for economic growth and regional development. Trade corridors act as ‘coordinated bundles of transport and logistics infrastructure and services that facilitate trade and transport flows between major centres of economic activity’ (Kunaka and Carruthers 2014: 1). Studies show that investing in sustainable infrastructure projects and building trade and transport corridors facilitates enhanced productivity through competition, reduced transaction and logistics costs (Asian Development Bank 2009). The rapid advancement in information and communications technologies (ICT) has brought remarkable economic transformation and changed the world’s economic and political landscape in fundamental ways. As a result, recent decades have witnessed a spurt in transport, energy, digital and infrastructure projects spanning across the globe. This has facilitated a strategic coupling of economic activity through global production networks (GPNs) (Yeung 2016). Increased trade liberalization and foreign direct investment have promoted global value chains. Governments have supported these processes by investing in infrastructure and human capital development (UNESCAP 2014: xiii). In a seamless world, enhanced connectivity however not only brings favourable prospects like technology, investment and markets but also presents transnational threats like terrorism, climate change and organized crime. The exercise of building economic corridors as part of the connectivity projects also causes social displacement and large-scale environmental damage (Yhome and Chaturvedy 2017). Moreover, as these corridors intersect diverse and often sensitive territories, their impact on the local security dynamics is a concern worth factoring in. They create a geostrategic interdependence through the physical presence of assets and people on the ground as well as through patterns of increased indebtedness, which is a potential source of vulnerability for low-income countries (World Economic Forum 2018). In other words, there remain a host of geographical, technical, political and social impediments to these connectivity initiatives.

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In a scenario of growing economic uncertainty at the international level, states feel the urgency to boost regional growth. To that end, enhancing regional connectivity and infrastructure development is vital. Regional developmental efforts are severely hampered by the lack of basic infrastructure services. In order to enhance a region’s overall competitiveness and productivity, countries need to build efficient, safe, affordable, socially and environmentally sustainable and seamless transport connections within and across regions (Bhattacharyay 2012: 147). For smooth transit and logistics of goods and services across borders, both ‘hard’ infrastructure (transport, energy, ICT) as well as ‘soft’ infrastructure (policies, institutions, rules and procedures) need to be improved (Bhattacharyay et al. 2006: 4). Cross-regional connectivity initiatives anchored in economic corridors, infrastructure projects and free trade agreements (FTAs) help deeper integration by attracting FDI and connecting regional and global production networks. Thus, amidst growing retrenchment and a pushback against globalization, connectivity figures top-most on the policy agenda of most countries as well as global development and financial institutions (Derudder et al. 2018). Eurasia, the Indo-Pacific and Africa are emerging as potential geo-economic and geopolitical hotspots. Several initiatives have been launched at national, regional, inter-regional and global levels such as the Belt and Road Initiative, the International North-South Transport Corridor (INSTC), Bay of Bengal Initiative for Multisectoral Cooperation (BIMSTEC), Bangladesh China India Myanmar (BCIM), Trans-European Transport Network (TEN-T), Trans-Eurasian Information Network (TEIN), Asia-Africa Growth Corridor (AAGC), Greater Mekong Subregion (GMS), Central Asia Regional Economic Cooperation (CAREC), the Common Market for East and Southern Africa and the South African Development Community. Thus, there is a new-found enthusiasm for greater trans-regional connectivity to access resources, improve communications, reduce trade barriers, build and upgrade infrastructure. Like elsewhere, the Indian foreign policy establishment has also appreciated the role of connectivity in making India a leading power. The next section discusses key elements of India’s connectivity discourse and some of the major initiatives taken.

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India and Connectivity: A Strategic Imperative For centuries, India has maintained extensive transcontinental links through trade and commerce, religion and culture. The onset of European colonialism however diluted many of these cross border and regional linkages (Datta 2017). In 1947, the first Asian-Relations Conference signalled the ‘emergence of Asia’ and later the Bandung Conference convened in 1955, inaugurated the notion of ‘Third-Worldism’. However, despite heralding the idea of Asian unity and leading the formation of NAM, India could not galvanize this momentum. The Cold War geopolitics and thereafter the rise of intra-state conflicts distracted the post-colonial states, as they became more preoccupied with the task of nation-building. The Asian economies made dramatic progress and the acceleration of globalization helped the region emerge as a new economic powerhouse. This was also accompanied by closer regional cooperation and which resulted in proliferation of institutional arrangements such as the ASEAN Regional Forum (ARF) and the Conference on Interaction and Confidence-Building in Asia (CICA). India too introduced massive structural reforms and reoriented its foreign policy in the 1990s. The launch of Look East Policy in 1992 and the East Asia Summit (EAS) was aimed at intensifying engagement with its eastern neighbourhood. The idea was to improve economic relations via greater infrastructural connectivity, regional development in the north-east, thereby contributing to regional security. Today, India’s emergence as a leading power in international politics has brought greater dynamism in the country’s foreign and security policy. The primacy of geography is once again being underscored in its diplomatic drive. India is reaching out to the world like never before, including a renewed focus on its neighbourhood, to fulfil its regional and global aspirations. To counter China’s expanding global footprint, India has aggressively ventured into strategic partnerships and establishing new connections and links. Connectivity has, in fact, emerged as a keyword in the lexicon of India’s foreign policy, seen as ‘central to the globalization process and particularly important for Asia’s growth and development’ (Swaraj 2016). By virtue of its geographical location and economic gravity,1 India can play a crucial role in promoting connectivity within 1 Research projects that the world’s shifting distribution of economic activity would locate literally between India and China by 2050 (Quah 2011).

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and beyond home (Gokhale 2018). Chahbahar port and the International North South Transport Corridor, according to former Foreign Secretary S. Jaishankar, could be game-changers in Central Asia. He therefore urged India to make sincere efforts to synergize the two key strands of its foreign policy—‘Act East’ and ‘Think West’ (Jaishankar 2016). In recent years, New Delhi has turned its attention to enhancing its land and maritime connectivity to unlock the vast potential of resource rich regions like Central Asia, Indian Ocean and Africa. By projecting smart power and seeking strategically resonant economic partnerships with other countries, India seeks to signal its strategic autonomy (Suryanaranyana 2018). Amidst a fast-changing geopolitical landscape, India strives to emerge as a relevant and influential player in a multipolar world. Its interests expand from the Indo-Pacific to Eurasia and Africa. And despite having a turbulent periphery, the Neighbourhood First policy brings back the focus on states in India’s vicinity. For consolidating its global role, India also needs to leverage its soft power to influence the regional order. And then of course, there is the extended neighbourhood, which includes Iran, Central Asia and Southeast Asia. The need for greater connectivity thus arises both as a strategic and economic imperative. It can provide a transmission channel to deepen and expand regional economic cooperation. It is an opportune time for the Asian countries to coordinate financing of regional infrastructure networks for a sustainable and inclusive development of the region. As the South Asian Association for Regional Cooperation (SAARC) remains a redundant regional organization, India has moved ahead by preferring sub-regional cooperation mechanisms like the BIMSTEC, a trans-regional cooperation platform between five South Asian countries (Bangladesh, Bhutan, India, Nepal and Sri Lanka) and two Southeast Asian countries (Myanmar and Thailand), and the other one in the eastern subcontinent involving Bangladesh, Bhutan, India and Nepal (BBIN) (Raja Mohan 2019). India is also the founding member of the South Asian Sub-Regional Economic Cooperation (SASEC) which comprises India, Bangladesh, Bhutan, Maldives, Nepal, Sri Lanka and Myanmar. Under this, there are a slew of road infrastructure projects connecting to the Asian Highway Network2 and the aim is to generate synergies 2 The Asian Highway Network starts from Tokyo in Japan and connects South Korea, China, Hong Kong, Southeast Asia, Bangladesh, India, Pakistan, Afghanistan and Iran to the border between Turkey and Bulgaria, west of Istanbul.

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between three levers—natural resources, industrial potential and connectivity (Asian Development Bank 2017). There is also the Bangladesh, China, India and Myanmar economic corridor to promote trade, multimodal transportation, energy and tourism. Among other such initiatives is the India–Myanmar–Thailand (IMT) Trilateral Highway, a 1400-kmlong highway which shall link India with Southeast Asia and is further expected to extend to Cambodia, Laos and Vietnam. India has also completed the construction of Sittwe Port in Myanmar as part of the Kaladan Multimodal Transport—a network of shipping, inland water and road communications. India has also partnered with Japan to take the latter’s assistance in connectivity initiatives in the north-east (Pulipaka et al. 2017: iv). With its Connect Central Asia policy, India seeks to expand its presence in the region through mega connectivity initiatives. For a long time, realization of India’s trade and commercial prospects remained elusive in the region due to lack of direct overland access. Moreover, Pakistan has proved to be an Achilles heel when it comes to building direct connectivity to Central Asia, with no significant headway having been made on the Turkmenistan-Afghanistan-Pakistan-India Pipeline (TAPI) project. With Uzbekistan, New Delhi is exploring the possibility of extending the Friendship Railway Bridge to Herat in Western Afghanistan (Roy Chaudhary 2018). Using the Shanghai Cooperation Organization (SCO) platform, India also wants to strengthen cooperation on counterterrorism. The operationalization of Chabahar Port has also facilitated overland access to Afghanistan and Central Asia. This has now been linked with the ambitious INSTC project that was initiated in 2000 along with Iran and Russia. The Corridor is expected to significantly reduce the transit costs of shipping from India to Russia and Europe by acting as a gateway to Eurasia, linking the Indian Ocean and the Persian Gulf to the Caspian Sea. India has also redefined its trajectory of engagement with Africa in a more holistic manner including diplomatic and security elements that were not there before (Roy Chaudhary 2018). Prime Minister Narendra Modi’s visit to Rwanda, Uganda and South Africa in July 2018 came at a time when both India and China are trying to bolster economic ties by shaping new narratives in the region (Pant and Mishra 2018). India is also collaborating with Japan on the Asia-Africa Growth Corridor (AAGC) that seeks to promote development cooperation through investments in quality infrastructure and capacity building.

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On the maritime front too, India is making itself more visible in the role of a net security provider in the Indo-Pacific region. Increased maritime connectivity therefore would bolster trade and investment and open new avenues for cooperation among states. To that end, India launched twin initiatives—SAGAR (Security and Growth for all in the Region) and SAGARMALA, which is aimed at port development. The overall idea is to address the diverse security challenges in the littorals and bolster the blue economy. India is collaborating with Indonesia, Seychelles and Mauritius in areas like coastal surveillance, offshore patrolling and improvement of logistics. For India, connectivity is not merely a reflection of its development ambitions, but the cornerstone of its vision for international cooperation (Swaraj 2016). Its connectivity vision is said to span from ‘from culture to commerce; from traditions to technology; from investments to IT; from services to strategy; and from people to politics’ (Modi 2016). The official policy discourse on connectivity in India however continues to emphasize respect for sovereignty, the rule of law, openness, transparency and equality. Maintaining regional peace and stability has priority over geopolitical competition. New Delhi does recognize the need to constructing roadways, railroads, developing waterways and improving digital connectivity to bring regional prosperity. However, it seeks to support sustainable projects which benefit local communities. India’s connectivity strategy emphasizes on a rules-based economically viable and ecologically sustainable with respect for sovereignty (Gokhale 2018). It is thus approaching like-minded partners who share this strategic interest, like Japan and the EU and regional groupings like ASEAN to shape the contours of the emerging global order. The next section discusses Indian and European perspectives on this globe-spanning connectivity project and the extent to which they have a shared narrative.

BRI: Indian Criticism, European Concerns The BRI’s ambitious economic corridors, supply chains, digital and transport infrastructure are creating new regional geographies (Flint and Zhu 2019: 2). Beijing’s key objective is to maximize global economic flows through the BRI which will bolster Chinese domestic growth. A key geopolitical objective is to counter the US-led liberal order in terms of discourses, practices and standards. In fact, China uses every political opportunity to actively define the meaning of openness in order to expand

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the circle of friends (Kohlenberg and Godehardt 2018: 2). The goal is to refashion the global economic order by drawing countries and companies more tightly into the Chinese orbit (Perlez and Yufan 2017). There is widespread anxiety that the BRI will be predominantly implemented by state-owned firms and financed by state-controlled banks and will thus follow the Chinese socialist model (Golley and Ingle 2018: 54). India has strong reservations about the BRI’s flagship project—the China Pakistan Economic Corridor (CPEC). While New Delhi boycotted the maiden BRI summit in May 2017, it skipped the second BRI Forum held in April 2019, which was attended by more than 100 countries. The MEA categorically stated that, ‘no country can accept a project that ignores its core concerns on sovereignty and territorial integrity’ (MEA 2017). The Government of India feels that in the absence of an agreed security architecture, connectivity could add to regional tensions (Jaishankar 2016). The other proposed corridors under BRI such as the new Eurasia Land Bridge, the Trans-Himalayan Economic Corridor, the China–Central Asia–West Asia Economic Corridor and the Bangladesh– China–India–Myanmar Economic Cooperation have a direct bearing on India’s economic and strategic interests. Moreover, Pakistan limits India’s influence in and access to Afghanistan and Central Asia which provides China a relatively free space in Eurasia (Sachdeva 2016). India also argues that connectivity initiatives should be multilateral and be inclusive and based on financial and environmental sustainability. Several countries including Turkey, Poland, Spain, Fiji, Sri Lanka and Argentina, which had attended the inaugural BRI meeting, decided to skip the second one apparently because of geopolitical concerns (Kuo 2019). In recent years, a number of Asian countries have suspended, scaled back or terminated projects, amid concerns over corruption, influencepeddling and rising debt (Prakash 2019). In fact, opposition parties in Malaysia and the Maldives were successful in ousting the incumbents by campaigning against Chinese megaprojects that were enhancing corruption rather than bolstering the economy. Concerns about the financial implications had also led newly elected governments in many countries to renegotiate contracts and revisit project costs. A glaring example is Malaysia’s $16 billion East Coast Rail Link, which became around 30 per cent cheaper (Small 2019). The outbreak of the COVID-19 pandemic has caused major disruption for the BRI too with worldwide lockdowns stalling several major projects. In fact, experts argue that because of the crisis’ adverse effects on global economic activities China might be forced

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to write off debt repayments (Tan 2020). At the same time, the pandemicinduced global recession might bring a blessing in disguise for the BRI. For instance, Pakistan struggling with a severe economic crisis has decided to go ahead with the CPEC project calling it crucial for country’s development (Hussain 2020). China has also revived its Health Silk Road (launched in 2016) to provide medical supplies either directly through its embassies or companies engaging in BRI projects abroad, such as Huawei or China Communications Construction Company (Lancaster et al. 2020). Moreover, the Digital Silk Road is being rebranded to help countries in contact tracing to fight the infection. Following China’s example, Columbia, the Czech Republic, Ghana, Israel, Norway, Singapore and India have introduced apps and mobile software applications to collect health-related data (Ji 2020). Several Indian analysts have argued in favour of selective participation in the BRI. As the second largest shareholder in the Asian Infrastructure and Investment Bank (AIIB), India will receive about $1.2 billion in loans of the total $4.5 billion from the Bank for its various infrastructure-related projects (The Economic Times 2018). They urge that one should go beyond the geopolitical implications of the BRI and make a more holistic assessment. Even though China undeniably derives considerable strategic leverage, New Delhi should make use of the opportunities offered by the BRI, which could enable India to enhance South Asian regional cooperation (Saran and Passi 2016). While several European and Asian companies are eagerly seeking to profit from the BRI’s economic opportunities, New Delhi’s official narrative obstructs participation by the Indian companies. Such an approach would prove detrimental for the long-term interests of the industry and private sector (Sachdeva 2019a). Moreover, with greater participation of its neighbourhood and Eurasia in the BRI, India will find it increasingly difficult to separate its own connectivity plans from the BRI-linked projects (Sachdeva 2019b). China has also intensified its COVID-19 diplomacy in Myanmar, Laos and Pakistan, countries which are key partners in China’s BRI projects—the China-Myanmar Economic Corridor and the high-speed Laos-China railway which is part of the Kunming-Singapore high-speed railway project (Yhome 2020). India too therefore needs to overhaul its economic policies and introduce necessary reforms to cope with the post COVID-19 challenges. China will surely capitalize on the situation owing to its technological superiority in the field of Artificial Intelligence and robotics (Mann and Singh 2020).

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However, this is an opportune time for India to recalibrate its approach and at the same continue influencing the discourse around it. The recent establishment of an Indo-Pacific Division in the Ministry of External Affairs signifies its desire to develop a broader cooperative vision for the region. In this context, it can work towards ‘multilateralizing’ the BRI with a set of rules (Sanwal 2019). For India, given the asymmetry in its relationship with China, it is pragmatic to have sustained dialogues with Beijing while also exploring engagement through multilateral platforms (Hashmi 2019). With Beijing’s growing emphasis on a clean and green BRI after the second BRI Forum, New Delhi has been able to shape the normative discourse in this realm and think more creatively on connectivity (Pant 2019). With both China and India eager to capitalize on the Wuhan spirit and Chinese consent in the declaration of Masood Azhar as a global terrorist, India refrained from issuing a statement on the eve of the second BRI Forum (Jacob 2019). China too did not make any bones about India’s absence from the second meeting saying it would not affect the ongoing high-level India-China dialogue (Raghavan 2019). At the second BRI Forum meet in April 2019, China announced a slew of measures in an attempt of to do stocktaking and course-correction after six years of launching the project. A report launched on the occasion reiterated principles of transparency, inclusiveness, extensive consultation and strengthening the role of multilateral mechanisms (Office of the Leading Group for Promoting BRI 2019). From encouraging foreign investments in China, greater transparency in tendering and bidding and making project financing more sustainable, China tried to recalibrate BRI to allay criticism on debt trap diplomacy (Joshi 2019). Based on the sustainability framework analysis of the IMF and the World Bank, China claims that BRI projects now have a more comprehensive and market-oriented financing supporting system (Asia Times 2019). On the other hand, there is no coordinated European response to the BRI since China has engaged primarily with individual EU Member States rather than through EU institutions (de Vergeron 2018: 7). The BRI has divided the EU into two groups: states like Belgium, France and Germany that are vocal against a ‘systemic rival’ and others including Italy, Hungary and Greece, which want greater political and investment ties with Beijing (Peel and Hornby 2019). BRI is gaining traction in Europe with 22 countries having inked cooperation documents with China (Bhadrakumar 2019). In the wake of its trade war with the United States, China has managed to woo a number of countries, including Japan, France, Canada,

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Spain, the Netherlands, Belgium, Italy, Australia, Austria, Switzerland and Singapore which have signed up for third-party cooperation to help build infrastructure in developing countries (Li and Han 2019). Italy is the first G-7 country to join the BRI in order to primarily boost its lagging economy. Italy’s entry has heightened Western concerns over the security implications of Chinese investment in critical sectors such as ports, energy, technology and agriculture (Chatzky 2019). The BRI’s commercial lure has also been quite effective among the growth-seeking but infrastructure-starved Central and East European countries (Singh 2019). The 16 + 1 initiative which was launched in 2012 to strengthen dialogue and cooperation between China and CEE countries also caused a lot of anxiety in Brussels for undermining the integration project. With Greece’s entry in 2019, now it is 17 + 1 as China is keen to connect the port of Piraeus via Macedonia to its proposed high-speed rail link between Belgrade and Budapest and then onwards to the western part of the continent (Kavalski 2019). Chinese state shipping company COSCO has heavily invested in Piraeus port, transforming it into the Mediterranean’s busiest trade port, along with Valencia, Spain (Pelagidis 2019). China’s expanding foothold in these regions has also helped it influence EU policies to some extent. For instance, in June 2017, Greece blocked an EU statement at the UN Human Rights Council criticizing China’s human rights record (Smith 2017). In July 2016, Hungary and Greece refused to sign an EU statement criticizing Beijing on the South China Sea issue (Gotev 2016). Like India, the European Union too has expressed concerns that BRI projects risk weakening environmental, social and governance standards. From Montenegro and Hungary in Europe to Pakistan and Sri Lanka in South Asia, there are similar experiences in terms of bad lending practices endangering financial stability of smaller countries, dual use of civilian projects for military purposes, and political interference (Baruah and Mohan 2018: 4). In April 2018, EU Member States’ Ambassadors in Beijing issued a statement criticizing the BRI as running ‘counter’ to their agenda for liberalizing trade and ‘pushed the balance of power in favour of subsidized Chinese companies’ (Martin 2018). However, despite calling China an ‘economic competitor’ (European Commission 2019), the EU remains China’s largest trading partner. More so, in 2014, the United Kingdom, Germany, France and Italy joined the AIIB as founding members, thereby acknowledging Beijing’s financial power and the strengthening Sino-European monetary ties (Casarini 2015). Since

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the launch of the EU-China Connectivity Platform in 2015, there are efforts to create a common framework for European cooperation with China on BRI with regard to plans, policies rules and principles governing joint projects including governance and rule of law issues (European Parliament 2016). The BRI presents a strategic challenge to Europe and the EU thus requires a broader and coherent framework anchored in an operating rulebook (Crookes 2019). At the 2018 EU-China Summit, the joint statement called for developing synergies between the BRI and EU’s initiatives, including the EU Investment Plan3 and Europe-Asia connectivity. Cooperation should be based on shared principles of market rules, transparency, and a level-playing field for all investors, and comply with established international norms and standards (European External Action Service 2018). In Europe, the most active stakeholders in BRI include local and provincial governments which seek to serve as China’s gateway to Europe and the large companies that engage in export trading, construction and logistics who seek to reap the benefits from BRI projects (Suetyi 2017). Brussels therefore seeks a more balanced and reciprocal trade and investment relationship with China (European Commission 2019). As majority of Europe’s trade transits through the Indian and Pacific Oceans and with more than four of its top ten trading partners in the region, the stability and security of Asia is increasingly important for European interests (Mohan 2018a). In this context, the EU connectivity strategy for Europe and Asia seeks to establish a normative framework and emphasize on the principled dimension of connectivity projects (Brattberg and Soula 2018). The next section discusses this EU plan of action to articulate a more coherent vision on the issue of connectivity and contrasts it with the BRI.

EU Strategy on Connecting Europe and Asia The disruptions in the prevalent global order have led states to explore new strategic opportunities to cooperate around common interests and values. The Trump Administration had also been critical of the transatlantic partnership. The BRI has certainly led to greater geopolitical competition. It is time for Europe to figure out its strategic choices, 3 Also known as the Juncker Plan, the Investment Plan for Europe was proposed in November 2014 to support EU’s long-term economic growth and boost competitiveness.

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especially because of political rivalry and growing economic competition between Eastern and Western Europe (Kemp et al. 2016: 12). The creation of the Eurasian Economic Union (EEAU) in 2015 has made Russia’s near abroad and the EU’s eastern neighbourhood overlap. However, since European and Eurasian countries have common interests in the fields of energy, trade and transport, economic connectivity could create the necessary incentives for dialogue and cooperation. The EU has therefore sought to devise a strategy to achieve greater internal cohesion as well as play a more significant role in global affairs. It has reached out to new partners and seeking new alliances in a reconfiguring world order and forge cooperation on issues like trade, connectivity and climate change. The EU Global Strategy 2016 set out to build a strategic narrative for Europe’s resurgence in the global arena. Recognizing the increasing importance of a ‘connected Asia’, it called upon the Union to increase its engagement with the rest of the world. Moreover, there is an opportunity for the EU to anchor a rules-based world order along with other like-minded partners and evolve a framework for a unified and cross-sectoral approach to connectivity (European Commission 2018a). For Europe, Asia offers a potential investment hub enabled by technological innovation and burgeoning growth. With the increasing volume of global trade and economic interconnectedness, there is a greater incentive to build and invest in infrastructure development and unlock the potential of the countries and regions that link Europe and Asia. Improved landbased connectivity through the Caucasus and Central Asia and unclogging the arteries passing through the Black Sea and the Caspian Sea would considerably reduce shipping time as well as costs. Moreover, the geopolitical competition for in Eurasia has intensified with players like China, Russia and the United States seeking to profit from greater connectivity in Eurasia. In order to capitalize on Asian economic dynamism, the European Union launched a Strategy on Connecting Europe and Asia in October 2018. In addition to enhancing global competitiveness and trade, the Strategy speaks about developing ‘a more cooperative approach to world politics, global stability and regional economic prosperity’ (European Commission 2018a). It envisaged a roadmap for engagement with Asia through transport corridors, digital links and energy cooperation and facilitating people-to-people connectivity, and how Europe could help shape the rules of the global marketplace. The Strategy proposed to

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link the trans-European Transport Network (TEN-T) to other economic corridors in Asia. It urged the strengthening and building of new bilateral, regional and international partnerships and identified Asia Europe Meeting (ASEM) and the Association of South East Asian Nations (ASEAN) as important platforms for regional cooperation on connectivity. To enhance economic diplomacy, Brussels has sought to create a business and investor friendly climate and deepen cooperation with the Asian Development Bank and the AIIB for financing connectivity projects in Asia. There is an added emphasis on ‘securing connectivity’ as in an age of hybrid threats and terror attacks since no one country can effectively safeguard trade, transport, energy and other critical infrastructure. The Strategy therefore calls for enhanced engagement with Asian partners particularly in the field of cyber security. While the announcement of the EU’s connectivity strategy for Asia was certainly timed as the BRI became more appealing, it is a European way of branding the connectivity model (Kruessmann 2018), based on international support for the values and principles promoted by the Union. Brussels seeks to enunciate its own ideas and terms and to be in driver’s seat on discussions related to connectivity apart from enhancing its strategic autonomy. The Strategy looks beyond investment in infrastructure and focuses on areas where the EU has a comparative advantage, such as green technology, digital connectivity or educational mobility (Gaens 2018). By stressing ‘sustainable connectivity’, Brussels underscores its normative quotient and reinforces the argument that connectivity initiatives must promote adherence to international norms and standards rather than lead to economic or political dependence (Broer 2018). The signing of the EU-Japan Partnership on Sustainable Connectivity and Quality Infrastructure in September 2019 reflected this congruence of interests reiterating emphasis on creating a level-playing field and partnering up in protecting freedom, security and justice (Schwarcz 2019). What however remains to be seen is that amidst the multifarious crises challenging Europe, how well can it execute this strategy in terms of mobilizing funds and support from Member States and the private sector. The EU has announced a e8 million support programme to boost sustainable energy in Central Asia (European Commission 2020) and also committed e50 million to the ASEAN Catalytic Green Finance Facility to support green infrastructure projects (Asian Development Bank 2020). It would also require greater coordination and public visibility on part of the EU

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to deliver on the proposals. The following section explores avenues for India-EU cooperation on connectivity frameworks.

India, Europe and Connectivity: Scope for Cooperation Since the two consecutive summits held in 2016 and 2017, India and the European Union have found many opportunities to consolidate their strategic partnership. While trade-related issues remain a sticky point of bilateral relations, there is convergence of interests over supporting a rules-based, multilateral order and addressing global challenges. From climate change to combating terrorism and achieving greater coordination on regional security issues, there is ample scope for the two sides to take the partnership forward. Recognizing India as ‘political heavyweight’ in Asia and an emerging global power, Brussels sought to strengthen political, economic and security and defence policy cooperation with India, in order to have a more balanced approach towards Asia (European Commission 2018b). Both India and the EU can further develop their toolbox for cooperation to leverage additional finance, enable political dialogue, and share expertise and knowledge in innovative ways (Paulo 2019: 5). Moreover, the changing global order has necessitated greater alignment and close cooperation between India and Europe. In the backdrop of Brexit, India has been looking for new ‘gateways’ to Europe. Similarly, the transatlantic rift has led Europe to more actively explore opportunities in a resurgent Asia (Mohan 2018b). Embracing the idea of multi-alignment in its foreign policy, India has sought to reach out to new partners and is pursuing initiatives like the Quadrilateral Security Dialogue (QUAD) with the United States, Japan and Australia as well as the Asia-Africa Growth Corridor. Similarly, the EU is looking for likeminded partners to address the key challenges of global governance and to diverse its markets and investments. The BRI has enabled India and EU to forge a normative convergence on the issue of connectivity (Baruah and Mohan 2019). The EU Strategy on India (November 2018) acknowledges the India as an important partner in implementing the EU Strategy on Connecting Europe and Asia and broader security policy engagement in the region (European Commission 2018b). The Strategy identifies key areas of engagement with India such as investments and business opportunities, education,

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skills and innovation initiatives, implementation of Paris climate agreement (European Commission 2018b). The India-EU shared narrative on connectivity seeks to promote initiatives that are commercially viable and transparent, guaranteeing a level-playing field for businesses, respect of labour rights and environmental standards, as well as avoiding financial dependence (Okano-Heijmans and Panda 2018: 21). Taking a holistic approach to connectivity that is people-centric covering transport corridors, digital links and energy networks, both India and EU emphasize the need to integrate connectivity into a framework based on internationally agreed practices, rules, conventions and technical standards (Paulo 2019: 30). Sustainable connectivity figures as a key theme in Indian and EU official positions and cooperation in the International Solar Alliance (ISA). The EU Connectivity Strategy seeks to leverage innovative financing initiatives like the Investment Facility for Central Asia, the Asian Investment Facility and the European Fund for Sustainable Development (EFSD) to support Asian countries and plug the funding gaps and meet their infrastructure needs (Benaglia 2018). The Netherlands has expressed interest to collaborate with New Delhi in developing port infrastructure and the inland waterways’ system (Okano-Heijmans and Sundar 2018). India’s rapid urbanization and the associated challenges related to the environment, water, air quality, waste and wastewater management, transport, disaster risk reduction and sustainable energy systems make urban development a particularly important area for cooperation with the EU (European Commission 2018b). Brussels is involved in a number of infrastructure projects in India such as metro rail and the Smart Cities initiative. The two sides have initiated dialogues covering regulatory aspects such as streamlining railway standards and questions of safety, security, decarbonization and air traffic management (Baruah and Mohan 2018: 5). The evolving Asian security and economic architecture presents an opportunity for New Delhi and Brussels to develop a congruent strategy. Having shared similar perspectives on connectivity, India and EU can extend this framework of cooperation to third countries as well. As Eurasia becomes increasingly significant in India’s strategic calculus, not just to counterbalance China but also to seek new markets for boosting its economic growth, it is time for India and EU to start a serious dialogue on their engagement in the region. The INSTC can be a vital area for collaboration and some European companies are helping India

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in the strategic Chabahar port. Brussels has also sought India’s cooperation to support cooperative and inclusive regional organizations including SAARC, BIMSTEC, ASEAN and the Indian Ocean Rim Association (IORA) (European Commission 2018b). Japan’s Expanded Partnerships for Quality Infra (EPQI) and the Asia-Africa Growth Corridor can also be platforms for deepening India-EU engagement. Both India and EU are closely collaborating with the ASEAN through the ASEAN Regional Forum and ASEM. The two sides can further explore opportunities in engaging with sub- and inter-regional groupings along the arc from South Asia to Southeast Asia (Yhome and Chaturvedy 2017). Amidst its internal quagmire that constrains its external action, and its quest to gain wider international presence through its global and connectivity strategies, the real test, like always, for the European Union is to go past rhetoric and deliver on the ground. For its connectivity strategy for Asia and India to take shape, in addition to a shared normative framework, mobilization of funds and stakeholders in a vastly diverse region remains crucial.

Conclusion Connectivity has become a critical aspect of diplomacy and foreign policy as states seek access to resource-rich regions and greater economic integration for regional development. In the coming years, the Belt and Road Initiative as China’s signature foreign policy venture will be the defining feature of the country’s external engagement (Panda 2017). Although doubts remain over its operational risks, at present there is no sign of the slackening of the cross-continental connectivity drive. After the second BRI Forum, Beijing has made some crucial announcements like removing the BCIM economic corridor from the list of projects. Amidst growing resentment, there is a realization that for smooth running of the initiative, it is important to accommodate concerns of others. The COVID-19 pandemic will have its ramifications on the BRI too, though a precise scenario eludes prediction at the moment. But vulnerability of global interconnectedness to such risks will certainly call for developing greater resilience including a facelift for the BRI. Henceforth, the digital component of the project is likely to take precedence. The crisis has also widened the trust deficit against China. Moreover, with waning of American hegemony and leadership, the pandemic will reshape the global order. In such a scenario, India can fill the gap as far as global leadership is concerned. In addition to controlling the spread of infection, the world is in desperate

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need of a robust plan to manage long-standing collective action problems such as environmental degradation and economic shocks. This prospect looks more difficult as multilateral institutions consistently fail to deliver. But sharing a common global outlook, India and the European Union can come together to address these pressing concerns. Given the economic and geopolitical competition that India and the EU face from China, it is an opportune time to get into an institutionalized mode of cooperation on issues such as connectivity. New Delhi and Brussels have recently shown interest towards a more pragmatic engagement going beyond the business-as-usual approach. In this new great game to have greater market access, connectivity and control over global value chains, India and Europe can be natural partners. While the EU has enunciated its plan of action for Asian continent and defined the major contours of its strategy for India, how much of it is actually realized remains to be seen. On the other hand, India continues to be fixated by the geostrategic implications of the BRI. It needs to do a more careful cost-benefit analysis of the economic opportunities and the risks that accrue. India can very well benefit from the European Union’s technological expertise in innovation and infrastructure development for developing its connectivity strategy for South Asia and beyond. Having found normative convergence on the issue of connectivity, both India and EU can also perhaps explore opportunities in third countries to improve infrastructure and regional connectivity.

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CHAPTER 7

India, Europe and the Indo-Pacific B. Krishnamurthy

Introduction The Indo-Pacific, which comprises the Indian, Pacific and the Southern Oceans, has been envisioned as an interdependent strategic and security continuum spreading across the East African coastline and the Western American seaboard, with Southeast Asia at its centre. It is also seen as an economic space of huge potential as well as of practical value. The Indo-Pacific has become the global pivot which concentrates majority of the world’s population (almost 60%), trade routes through which one-third of international trade transits and of fast growing economies, which contributes two-thirds of global growth in gross domestic product (GDP). Six members of the G20—Australia, China, India, Indonesia, Japan and South Korea—are from this region. As a cohesive maritime realm, it has ineluctably emerged into a defining geopolitical, geoeconomic and geostrategic theatre of cooperation as well as contestation of the twenty-first century. Stability in the Indo-Pacific region is essential and vital for international prosperity as well as security and any crisis/conflict in this area is likely to adversely affect the interests of almost all of the global powers.

B. Krishnamurthy (B) Centre for European Studies, Pondicherry University, Puducherry, India © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 R. K. Jain (ed.), India, Europe and Asia, https://doi.org/10.1007/978-981-33-4608-6_7

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However, the Indo-Pacific region has become the world’s ‘geopolitical cockpit’ (Rogers 2013: 71) because of China’s self-seeking and disruptive ambitions in its expansive maritime space and especially in the South China Sea (Rahn 2018), through which about one-third of world trade (about $3.3 trillion) passes. At the same time, a partnership of democracies, including the United States, the European Union, Japan, Australia and India, seek to maintain the status quo by preserving a multilateral and multipolar system and a ‘rules-based order’. This chapter explores the politico-economic as well as strategic interests of India and the EU in general and of France and the UK in particular, in the Indo-Pacific region. Apart from focusing on their concerns and interests, the chapter argues that they should also take into account concerns of regional powers, especially the Southeast Asian states, which are wary of the Sino-American rivalry.

China and the Indo-Pacific In recent years, China has eschewed the policies of ‘peaceful rise’ and ‘harmonious development’. It has begun to assert itself under President Xi Jinping, who seeks to establish an Asian order with China at its centre. The frequent Chinese references to the South China Sea being part of its historical territory ignore the fact that they are also claimed by six of its Southeast Asian neighbours (Rahn 2018). China advocates limited access for others, while claiming exclusive access for itself and on that basis sought to impose anti-access/area denial (A2/AD) strategy in the South China Sea. It has also challenged mainstream interpretations of the United Nations Convention on the Law of the Sea (UNCLOS) in objecting to the activities of extra-regional powers, and insisted that naval exercises, reconnaissance as well as surveillance activities undertaken without prior notification and permission of the coastal state violate Chinese domestic law as well as international law (Glaser 2012, April: 1). Thus, China seeks to enforce its strategy of ‘active defense’ in the South China Sea against extra-regional powers, who intend to challenge its sovereignty claims (Zhen 2018, 4 June).1

1 In June 2018, Lieutenant General He Lei, Vice-President of the Academy of Military Science and head of Chinese delegation, stated at the Shangri-La Dialogue that there would be no restrictions on normal freedom of navigation in the South China Sea.

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China’s demarcation and exclusive claim of nearly all of the South China Sea along with its living and non-living resources as its own through maps marked with the so-called nine-dash line that overlaps with the Exclusive Economic Zones of Vietnam, the Philippines, Malaysia, Taiwan, Brunei and Indonesia were disputed by them. This has led the South China Sea to emerge as a potential flashpoint between these claimants. In an effort to promote peace and stability in the region, ASEAN negotiated a Code of Conduct in the South China Sea (ASEAN 2002) and a subsequent declaration a decade later. Thus, China has been challenging the rules-based system using a combination of sharp power, military coercion, economic might and diplomatic assertiveness (Hemmings 2018). Taking advantage of the grave situation created by the COVID-19 pandemic, China has further built infrastructure in the South China Sea and seeks to push its illegal claims to the natural resources in the area. It even apparently hopes to build nuclear reactors in the area in disregard of international law and rules (Nicol 2020).

The Indian Ocean Littoral Beijing has been following hexiao, gongda policy in South Asia by providing economic, political and military support to smaller South Asian countries to counter India. In its desire to impress on India that the ‘Indian Ocean is not India’s Ocean’ in spite of its strategic mid-point position and to establish itself as a ‘resident power’ in the Indian Ocean region, China has sought to challenge its maritime superiority in the region. In order to develop trade linkages and to protect its sea lines of communications (SLOC) as well as shipping routes across the Middle East, Africa and Europe, China has made strong inroads into the South Asian maritime region.

However, if France and Britain intended to sail within 12 nautical miles of Chinesecontrolled islands and reefs, that would be regarded as ‘an intentional provocation’. Cited in Zhen (2018).

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The Belt and Road Initiative and the Indo-Pacific China’s Belt and Road Initiative (BRI) seeks to link China with Europe by land as well as sea routes and to develop infrastructure and connectivity all through the way. This geo-economic and strategic plan consists of two trajectories: the Silk Road Economic Belt—a Eurasian overland road modelled on its ancient prototype, linking China with Europe and running across Central Asia and Russia—and the Maritime Silk Route, a maritime route connecting China and Europe via Southeast Asia, India and Africa (China Ministry of Foreign Affairs and Ministry of Commerce 2015). The BRI seeks to link the Indo-Pacific region, the global economic growth engine, with the European Union, the world’s largest economy and trade bloc. By facilitating trade and investment, deepening economic and technical cooperation and by establishing free trade zones, it aims to create a huge Eurasian market. There was also an effort to develop a maritime trade route between China and Europe through the Indian Ocean and the Mediterranean coast and from there take a land route to reach Central and Eastern European countries.

China and the Indian Ocean China’s foray into the Indian Ocean region as a part of its Maritime Silk Route initiative poses a direct threat to the Indian economic and security interests. Chinese infrastructure investments in the Indian Ocean littoral countries are aimed at establishing itself as a ‘resident power’ in the Indian Ocean and to build up an empire of ‘exclusive economic enclaves’ run by Chinese conglomerates so as to usher in a Pax Sinica. An ‘undeniable neo-colonialist pattern, improvised on the earlier European colonial venture’, can be observed in the Chinese quest for resources, markets, and bases in the Indian Ocean region (Malik 2018: 67, 71). China’s flexing of its financial and commercial muscle to create bases or military facilities in Myanmar, Bangladesh, Pakistan, Sri Lanka and the Maldives, the so-called String of Pearls, could turn out to be a potential maritime stranglehold on India. The handing over of Hambantota port to China on lease in 2017 by the Sirisena government triggered alarm bells in New Delhi since Chinese control over a key port close to the Indian coast ‘with one eye on the shipping lanes’ (Shukla 2018, 24 November). The fact that the Chinese

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submarines were allowed to dock twice at Colombo harbour despite India raising concerns stands proof of security risks that are likely to be faced by the country in the years to come. Similarly, the fact that three Chinese submarines docked at a Maldivian port in August 2017 amplified India’s concerns (Mundy and Hille 2019). The possibility of Beijing building artificial islands near the Maldives and developing a naval and airbase there, not far from Lakshadweep, where India has a naval base, would enable a countervailing Chinese naval presence in the region (Shukla 2018). A Chinese base in the Maldives might upset ‘the naval balance of the whole Indian Ocean, potentially threatening mainland India, as well as the nearby US base at Diego Garcia’ (Brewster 2018). The rising presence of Chinese submarines in the Indian Ocean, its military base in Djibouti in the Horn of Africa, prospects of opening up new air and naval bases and its naval entry into the Middle East and Suez Canal is a cause of concern for India and other countries. In 2011, the China Ocean Mineral Resources R&D Association (COMRA) signed a 15-year exploration contract with the International Seabed Authority to develop ore deposits in future. This has given rise to concerns that China may indulge in exploiting the mineral resources in the EEZs belonging to other Indo-Pacific littoral countries. China’s 7,000 metre manned submersible vessel Jiaolong could also be used to monitor maritime and naval activity in the Indian Ocean in general and the nuclear submarine activities of the United States, the UK, France and India, in particular, by trailing their radioactive signature. Naval strategists point out that the deployment of the Jiaolong could possibly play a significant role in Chinese Navy’s Indian Ocean maritime strategy (Sakhuja 2014).

The Quad In 2007, the United States along with the like-minded democracies such as India, Japan and Australia initiated the Quadrilateral Security Dialogue, popularly known as Quad, in an effort to balance China’s maritime rise as a part of its containment strategy. However, the first Quad arrangement had become a non-starter and the stability and future of the group which was only resurrected in 2017 after a ten-year hiatus (Hemmings 2018: 24). In view of the Trump Administration’s economic-centric ‘America First’ policy, the Southeast Asian nations do not regard American plans to

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deal with China’s fait accompli in the South China Sea as very reassuring. The US stance that ‘territorial disputes should be a matter between China and its Asian neighbours’ clearly unnerves them (Zhen 2018). They are not ready to fall for the American vision of a zero-sum ‘geopolitical competition between free and repressive visions of the Indo-Pacific’ (Deo 2018). Moreover, the growing trade war and technological competition between China and the United States have heightened fears of the Southeast Asian nations, being caught in the crossfire (Zhou 2017). The Southeast Asian leaders doubted Washington’s continued commitment to Asia, especially after President Trump assumed power and felt that ‘the US will only act to protect its own interests and will leave smaller states to fend for themselves’ (Zhou 2017). As a result, ASEAN have so far been reluctant to formally support the idea of a ‘Quad Plus’, which would include Southeast Asian countries as partners. Secretary of State Mike Pompeo’s commitment to ASEAN’s centrality in the Indo-Pacific region too failed to convince them. Their preferred way of engagement for the promotion of a free, open and inclusive Indo-Pacific would be through the strengthening of existing regional institutions such as the ASEAN, the East Asia Summit and the Indian Ocean Rim Association (Saha 2018).

India and the Indo-Pacific For India, the term ‘Indo-Pacific’ embraces the entire western and central Pacific and the Indian Ocean. The Indian Navy’s primary Area of Responsibility (AOR), according to the Indian Maritime Security Strategy of 2015, includes the Western Indian Ocean, Indian territorial waters and the sea lanes of communication, while it’s secondary AOR comprises the Southeast Indian Ocean, South and East China Seas, and the Western Pacific (India, Ministry of Defence 2015: 32). India’s approach towards Indo-Pacific is centred on ASEAN. To that end, New Delhi signed the ASEAN-India Partnership for Peace, Progress and Shared Prosperity (2016–2020). Moreover, India believes that a unified and strengthened ASEAN could defend the core interests of its member states and tackle any future Chinese contingency/challenge (Oak 2019). On 25 January 2018, in an op-ed that was published by 27 newspapers in ten languages in the ten ASEAN member states, Prime Minister Narendra Modi stated that India and ASEAN have relations ‘free from contests and claims’ and ‘believe in the sovereign equality of all nations

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irrespective of size, and support free and open pathways of commerce and engagement’ (Krishan 2018). The Delhi Declaration (25 January 2018) reiterated their resolve to ‘cooperate for conservation and sustainable use of marine resources in the Indian and Pacific Oceans in accordance with international law, notably the United Nations Convention on the Law of the Sea (UNCLOS)’ (ASEAN 2018). At the Shangri-La Dialogue on 1 June 2018, Prime Minister Narendra Modi stated that ‘the destiny of the world will be deeply influenced by the course of developments in the Indo-Pacific region’. While elaborating on the Indian vision for the Indo-Pacific Region as a free, open, inclusive region, Modi pronounced that ‘ASEAN has been and will be central to its future’. He also maintained that the India-ASEAN ‘common prosperity and security require us to evolve, through dialogue, a common rules-based order for the region’. He emphasized on ‘equal access as a right under international law to the use of common spaces on sea and in the air that would require freedom of navigation, unimpeded commerce and peaceful settlement of disputes in accordance with international law’. While maintaining that India’s engagement with the Indo-Pacific region would be ‘inclusive’, Modi stated categorically that India’s strategy is not ‘directed against any one country’ (Modi 2018). Realizing the significance of Maritime Domain Awareness and the centrality of information sharing in the process, India inaugurated the Information Fusion Centre for the Indian Ocean Region at Gurugram in December 2018 with the vision ‘to be a nodal centre of excellence for promoting collaborative maritime safety and security; towards a peaceful, stable and prosperous Indian Ocean Region’ and a mission ‘to advance maritime safety and security in the Indian Ocean Region; by enhancing maritime domain awareness and coordinating activities, through information sharing, cooperation and expertise development; along with partner nations and agencies’ (Indian Navy). To emphasize that the Indo-Pacific continues to remain embedded in its foreign policy and that its IndoPacific strategy is expected to maintain the proclivity for soft balancing among the various stakeholders, the Government of India created the Indo-Pacific Division in the Ministry of External Affairs in April 2019 (Purayil 2019). Prime Minister Narendra Modi’s visit to the Maldives in early June 2019 was viewed as a reaffirmation of both New Delhi’s ‘Neighbourhood First’ policy and of the SAGAR (Security And Growth for All in the Region) doctrine, outlined by Modi in 2015 with the aim of keeping

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the Indian Ocean region peaceful and secure (Roche 2019). Neighbours agreed to ensure maritime security in the Indian Ocean region through coordinated naval patrolling and aerial surveillance, information sharing and capacity building. In its effort to closely monitor Chinese naval/submarine traffic in the region, India also seeks to establish a chain of coastal surveillance radar stations in Sri Lanka, Maldives, Mauritius and Seychelles, besides along its own coastline. The one in Maldives was inaugurated in June 2019 (Lintner 2019). India has its own limitations to play an effective role beyond its traditional area of operation in the Indian Ocean. There are, according to Pant and Rej, three interrelated ‘deficits’, namely strategic, capabilities and normative, behind India’s reluctance and reticence to play a more robust naval role in the western Pacific and its refusal for joining the United States in patrolling of the South China Sea. Lack of coordinating policy infrastructure to integrate and apply resources in the pursuit of national interests, and the constraints on its naval power-projection capabilities restrict India from extending its naval activities beyond the Indian Ocean region, they point out. Perceptional divergence on what constitutes FONOPS from the western powers, especially the United States, too makes it difficult for India to involve in these naval patrol activities (Pant and Rej 2018: 47–61). Rahul Roy-Chaudhury and Kate Sullivan de Estrada too support this point of view and maintain that significant structural, political and ideational difficulties impede India from playing its role in the Indo-Pacific region to its full potential. For the time being, India’s engagement with the Indo-Pacific continues to remain rhetoric, diplomatic, economic and projection of a wish list, they maintain (Roy-Chaudhury and de Estada 2018). These predicaments make it necessary for India to go for a tripartite agreement with the European Union and Japan to provide an alternative to China since they adhere to international standards and best practices, thereby save them from falling a prey to the Chinese ‘charm offensive’ (Dave 2019). This may also enable these liberal democracies in establishing and nurturing a multilateral and multipolar system and a ‘rules-based order’. Likewise, India’s joining hands with the regional as well as extra-regional powers in security sector too may prove to be a force multiplier for India.

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The European Union and the Indo-Pacific At the Shangri-La Dialogue (2015), when Federica Mogherini, the High Representative of the European Common Foreign and Security Policy and the Vice-President of the European Commission, stated that the EU ‘for sure is not an Asian or a Pacific power’ (Mogherini 2015), she apparently meant that the Europeans were not interested in getting embroiled in territorial disputes in the South or East China Seas. However, the Europeans have a direct stake in the preservation of a rules-based liberal order in the Indo-Pacific. They therefore embrace the notion of an open and free maritime domain, free trade and a multilateral and normative approach to conflict resolution, which ‘stand in sharp contrast to the notion of exclusive zones of influence, mercantilism and unilateral approaches to territorial conflicts’ practised by China (Simón and Speck 2018: 45). In response to developments in the South China Sea in 2016, Mogherini clarified that the EU was committed to maintaining ‘a legal order for the seas and oceans based upon the principles of international law’, as reflected notably in the United Nations Convention on the Law of the Sea. This, she added, included ‘the maintenance of maritime safety, security, and cooperation, freedom of navigation and overflight’. She urged ‘all claimants to refrain from militarisation in the region, from the use or threat of force, and to abstain from unilateral actions’ and maintained that the EU ‘encourages further engagement in confidence building measures which seek to build trust and security in the region’. She also assured support for the ASEAN-led regional processes; urged for the swift finalization of the Code of Conduct which would ensure a rules-based regional and international order; and offered to share best practices of the Union on maritime security (Mogherini 2016). Being the largest economy and trading bloc and having developed more than a third of its trade with the Indo-Pacific countries, the EU tends to approach the region from an economic and commercial point of view (Selivanov and Casarini 2018). Europe’s economic prosperity is highly dependent on maritime traffic, the safety of its sea routes and stability in the Indo-Pacific (Pejsova 2018: 1). To that end, the EU has been actively involved in anti-piracy operations against Somali pirates since 2008 in the Western Indian Ocean region. Brussels has also been investing in training, enhancing national legislation, information-sharing and maritime domain awareness through

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its Critical Maritime Routes Programme (CMR) in order to promote a holistic approach to maritime security (Pejsova 2016: 4). Chinese attempts to reshape the existing rules-based global order, if not establish a new China-centric one has led the European Union to emphasize that the process must be set ‘within the framework of an international order based on dialogue and the respect of multilaterally set rules’ (Pejsova 2019). The EU’s stance on the Indo-Pacific concept is quite different from that of the United States and the Europeans maintain that the ‘free and open Indo-Pacific’ advocated by Washington underscores freedom of navigation and right to overflights, and a rules-based, liberal order is a necessary precondition for the development, prosperity and stability of not only that of the Indo-Pacific region but also at the global level. At the same time, they argue that the growing competition and confrontation between the United States and China leaves the Southeast Asian countries with a Cold War-type binary choice between them. The US-China confrontation poses a potential danger with the Indo-Pacific concept (Pejsova 2018). While projecting the EU as a new player in the Indo-Pacific, Eva Pejsova maintains that ‘with its geographical scope, focus on connectivity and maritime security, as well as the values of freedom and openness it promotes’, the Indo-Pacific concept is well aligned with the Union’s ‘interests and ambitions in the region’. The Indo-Pacific, she argues, remains a region where foreign policies and interests of the Member States’ align, and suggests that ‘stability in the region cannot be sustained without taking into account all players, existing institutions and security structures’ (Pejsova 2019).

France and the Indo-Pacific Unlike the European Union, France and the UK, which are geopolitically engaged in the Indo-Pacific, are the only European powers with the means and the political will to deploy their naval assets in support of freedom of navigation in the maritime domain. The French Armed Forces consider the Indo-Pacific as an area spanning from Africa’s eastern façade to French Polynesia akin to the Indian vision of the Indo-Pacific maritime space. The French White Paper on Defence and National Security of 2008 proposed that the region from the Atlantic to the Indian Ocean should become France’s ‘priority geographic axes’ and ‘key zone

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of interest’ during the twenty-first century. It called for a greater concentration of its military presence in that area in order to protect the national interest. The French White Paper on Defence and National Security of 2013 also emphasized that the Indian Ocean is increasingly becoming prominent and that France should seize opportunities that may emerge in this strategic hot spot. France’s possession of valuable military assets such as 8,000 prepositioned troops and capabilities in its bases in La Réunion, Mayotte, Djibouti and the United Arab Emirates have formed into an interlocking ‘quadrilatère français ’ (French quadrilateral), and covers the Southwest Indian Ocean as well as the SLOC in the Indian Ocean region. Additional military facilities in French Polynesia and New Caledonia compliment France’s quadrilateral strategic nodes (Rogers 2013: 71–72). The French military capabilities are further reinforced by their joint military exercises with regional powers such as India, Australia and Japan and by their sale of defence equipment worth e13.411 billion to India between 2008 and 2017 and to Singapore, Malaysia, Indonesia, Australia and the Gulf countries (France, Ministry of Defence 2019: 17). Besides defending its territorial and economic interests2 in the region (France, Ministry of Defence 2019: 2), France is also ready to contribute to the stability of the region alongside its partners, primarily India, Australia, Japan, the United States and the UK, as well as Malaysia, Singapore, New Zealand, Indonesia and Vietnam. In 2016, France declared its determination to lead the European patrol operations in support of freedom of navigation, incoherence with the EU’s support for the rulesbased international order (Chen 2014). In her address to the Shangri-La Dialogue in June 2018, Florence Parly, French Minister of the Armed Forces, insisted on peaceful negotiation to sort out territorial dispute within the framework of international law and the rule-based order. France, she stated, would support the Code of Conduct in the South

2 France possesses 465,422 km2 (including Terre Adélie) and is bestowed with almost 9 million km2 of EEZ (world’s second largest EEZ) in the Indian and Pacific Oceans. Some 1.6 million French citizens are living in French DOM-TOMs (French Overseas Departments and Territories) and at least 200,000 French Nationals are living in the Indo-Pacific States. In 2018, France exported up to e66.438 billion to the Indo-Pacific (defence equipment not included) and imported up to e95.930 billion from the IndoPacific (defence equipment not included). There are more than 7,000 subsidiaries of French companies present in the region (France, Ministry of Defence 2019: 2).

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China Sea that is ‘legally binding, comprehensive, effective and consistent with international law’. As if in response to the Chinese attempts at land reclamation and developing military installations and communication networks, thereby swiftly and singularly establishing facts on the ground, Parly maintained that ‘fait accompli is not the fait accepted’. Instead, she asserted, ‘disputes should be resolved by legal means and negotiation, not by fait accompli; and freedom of navigation must be upheld’ (Parly 2018). ‘By exercising our freedom of navigation, we also place ourselves in the position of a persistent objector to the creation of any claim to de facto sovereignty on the islands’, she added (Zhen 2018). The 2030 French Strategy in Asia-Oceania towards an Inclusive Asian Indo-Pacific Region, which was presented on the sidelines of the Conference of the Ambassadors in Paris on 28 August 2018, outlined the French plan to work for strengthening the EU’s position by elaborating its strategy in the Indo-Pacific region by supporting the Union’s intention to sign a strategic partnership and a bi-regional free trade agreement with the ASEAN, revitalizing the Asia Europe Meeting (ASEM),and implementing its ‘Connecting Europe and Asia’ strategy (European Commission 2018). France is a strong advocate of a stable, multipolar order and efficient and effective multilateralism, backed by robust measures and a sense of reciprocity to address and resolve issues through peaceful negotiations. It has been engaged with multilateral forums across the Indo-Pacific region such as ASEAN, the Indian Ocean Rim Association (IORA), the Indian Ocean Commission, Quadrilateral Defence Coordination Group, the Indian Ocean Naval Symposium (IONS), the Western Pacific Naval Symposium (WPNS) and the South Pacific Defence Ministers Meeting and intents to engage in the ASEAN Defence Ministers Meeting-Plus (ADMM-Plus), of which it is yet to become a member. Paris had also acceded to the Treaty of Amity and Cooperation in Southeast Asia in January 2007. France’s Pacific territories of New Caledonia, French Polynesia, Wallis and Futuna have become part of the Pacific Islands Forum (PIF), thereby gaining a stake for France in the regional organization. France also intends to join the Regional Cooperation Agreement on Combating Piracy in Asia (Sarangi 2019: 119). The French have recently asserted that they ‘are part of the region’. French Minister of Armed Forces Parly made a strong ‘case for the emergence of an Indo-Pacific axis with France, India and Australia as its backbone, but with a strong cooperation with other countries in the region and with Europeans’ (Parly 2019). She presented the new version

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of the French defence policy in the Indo-Pacific, stressing the need of developing useful links and charting out joint actions for shared security with the objective of not only defending French territories but also establishing a normative, rules-based order (Nicolas 2019). To impress on others that France is here to stay in the Indo-Pacific, the French Navy dispatched Charles de Gaulle, its only aircraft carrier, in mid-2019 on an extended Indo-Pacific deployment engaging in joint naval exercises with the navies of partner countries like India and Australia.

The UK and the Indo-Pacific The UK has an interest in and the ability to play a strategic role in the Indo-Pacific region. An estimated 12% of the UK’s trade transits the South China Sea and remains the main reason for the British interest and involvement in the region. The UK maintains an effective geostrategic presence in the Indo-Pacific and presides over a ‘strategic array’, comprised of an army barracks in Brunei, a logistical and refuelling facility in Sembawang in Singapore, Gurkha recruitment facilities in Nepal, a military complex on Diego Garcia (at present operated in conjunction with the United States), and a naval command post in Bahrain, which connects with British air and naval facilities in the Mediterranean (Hemmings 2018). The array enables Britain to honour its historical commitment to the Five Power Defence Arrangements (FPDA) covering Australia, Malaysia, New Zealand and Singapore. Gavin Williamson, the British Secretary of State for Defence, while addressing the Shangri-La Dialogue in June 2018 stated that the UK was willing to send warships to the region through the South China Sea to challenge Beijing’s expanding military presence in the disputed waters and to preserve the rule-based order for the long-term. He added that it was necessary to make it clear that nations need ‘to play by the rules, and there are consequences for not doing so’. He urged China to appreciate that a ‘rules-based order benefits us all, being resolute, pushing back against the dangers and shoring up our international system’. He insisted on ‘working strategically, working smarter and working together’ (Williamson 2018), to tackle the challenge from the powers who wish to alter the status quo. There is considerable difference between the American and the British patrol activities in the disputed waters of the South China Sea (SCS). Tuan Anh Luc differentiates the British Royal Navy’s patrol in the SCS from the freedom of navigation operations (FONOPS) of the US Navy

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and maintains that ‘while the former was a traditional affirmation of freedom of navigation on the high seas in full compliance with international law and norms, the latter was conducted to challenge and invalidate China’s disproportionate and unacceptable maritime claim in the area’ (Luc 2018). The French attitude too resembles more the British rather than the American stance. Bill Hayton, an expert on the developments in the South China Sea at Chatham House, maintains that while the right of ships to sail in the international waters on the basis of innocent passage remains a fundamental international principle, China intends to unilaterally limit it. The recent voyages by French and British warships, he argues, are ‘a way of resisting that limitation’ (cited in Rahn 2018).

India, the UK and the Indo-Pacific During the India-UK Summit in New Delhi in February 2013, Prime Minister David Cameron called for the establishment of a new ‘special relationship’ with India, particularly in relation to strategic issues and fighting cyberattacks and terrorism and the Indian President reciprocated the sentiment by calling for greater collaboration between the two powers, particularly in strategic/security issues. The April 2017 India-UK joint statement on the defence partnership noted the need to enhance bilateral information exchange to improve maritime domain awareness; indicated the significance of the Indo-Pacific holds in their strategic thinking; and provided a framework for their collaboration. The commitment to a free and open Indo-Pacific was reiterated by Prime Minister Theresa May in 2018, who also insisted on the freedom of navigation as well as international obligations, standards, best practices that need to become part of connectivity initiatives. There is need for both India and the UK to focus on areas of common interest, which would enable them to balance China’s influence and may also facilitate capacity building and knowledge sharing leading to enhanced maritime security and sustainable development in the region (Dave 2019). Moreover, India and Britain need to strengthen their relations with Japan, Australia and Southeast Asian countries. The British, James Rogers argues, should strengthen and activate the FPDA, in order to pursue their strategic engagement in the Indo-Pacific region (Rogers 2013).

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India, France and the Indo-Pacific France and India share the same geographical definition of the IndoPacific. Paris regards the entire Indian Ocean is part of the Indo-Pacific. This makes it easy for New Delhi and Paris to come together (Rej 2019). Their shared maritime vision, which intends to ‘uphold the law of the sea in the Indian Ocean, prevent the kind of military unilateralism that has come to grip the Western Pacific, secure the sea lines of communication, respond to humanitarian disasters and promote sustainable blue economy’, smoothly synchronizes their thinking and actions (Mishra 2018). France and India have engaged in regular joint manoeuvres between their navies (Varuna), air forces (Garuda) and land forces (Shakti). The Varuna exercises have in fact become an integral part of the institutionalized interactions between the two navies. They have contributed to building confidence and trust. They reflect a convergence of interest in enforcing the freedom of the seas and protection of the SLOCs (SaintMézard 2015: 7). France has identified India as a privileged partner in the region. In fact, former French Defence Minister Jean-Yves Le Drianin 2013 stated that, ‘apart from our Allies and European partners, there are few countries across the world with which we are prepared to go as far as we do with India’ (Le Drian 2013). In 2016, France and India initiated a dialogue on maritime security issues, which led to the signing of a statement of Joint Strategic Vision on the Indian Ocean by the two heads of State in March 2018. This agreement provided for the reciprocal provision of logistic support, supplies and services between the armed forces of the two countries during authorized port visits, besides joint exercises and training. Both countries have also decided to hold an annual defence dialogue at the ministerial level to deepen defence and strategic ties. They also signed another agreement on the exchange and reciprocal protection of classified and protected information. In response to China’s growing assertiveness and military expansionism in the Indo-Pacific region, both the parties displayed their determination to develop cooperation at an ‘unprecedented’ level so as to ensure peace and stability in that maritime space (TOI 2018, 10 March). Referring to maritime security cooperation, Modi and Macron reiterated that it will be crucial in order to maintain the safety of international sea lanes for unimpeded commerce and communications. As such, the IndoPacific has emerged as the new arena for cooperation between Delhi

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and Paris, with greater political coordination, mutual logistical support and seamless interoperability between their security forces. They have also made up their mind to transform their bilateral cooperation more inclusive by engaging other big and small partners in the littoral (Indian Express 2018). Safeguarding freedom of navigation and securing the stability of the Indo-Pacific remained a crucial item on the agenda when Modi met Macron at their annual summit in August 2019. It was decided to jointly produce satellites for maritime surveillance in the Indian Ocean region, to coordinate their action at the Indian Ocean Rim Association and the Indian Ocean Naval Symposium and to undertake, a joint project for reinforcing assets for combatting piracy and all kinds of maritime trafficking in the South Indian Ocean along with other partner countries (Roy Chaudhury 2019). Indian scholars welcome Indo-French cooperation in the Indian Ocean region and believe that interoperable navies using each other’s naval facilities will lead to the establishment of a more effective security architecture in the Indo-Pacific (Pant 2018). This is likely to promote Indian strategic interests in the western Indian Ocean region since it would provide access to French military bases at Djibouti, Abu Dhabi and La Réunion, which can serve the Indian Navy as a force multiplier (Mishra 2018). The ‘sister island concept’ between the Andaman and Nicobar Islands in the eastern Indian Ocean and La Réunion in the western Indian Ocean advocates enhanced Indo-French cooperation to realize sustainable development in these strategic islands. The geographic advantages and potential for maritime domain awareness capabilities inherent in these islands would enable India and France to become key players in securing the Indo-Pacific region (Baruah 2019, March). Abhijnan Rej too supports this idea and insists on the need to add teeth to this notion. He suggests that both these islands ‘can be developed in a coordinated fashion as hubs for anti-access/area denial (A2/AD) complexes’, and adds: ‘The ability to hold Chinese SLOCs at risk at multiple points throughout the Indian Ocean stand to significantly modify Beijing’s behaviour in that it raises the costs of conflict arising from the former significantly – and therefore acts as a deterrent. Significant Indian, French and/or other actors’ investment in A2/AD capabilities may also help curb Beijing’s newfound enthusiasm for power projection’ (Rej 2019). The enthusiasm for cooperation and coordination between India and France is also reflected in the European diplomatic and scholarly circles

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as well. For instance, French Ambassador Alexandre Ziegler stated that India and the EU, especially France and the UK, have convergence in their vision of the way the Indo-Pacific region should evolve and flourish in the years to come (Ziegler 2018). It was also necessary, he added, to have a vision for bilateral strategic coordination for the Indian Ocean and to back it with measures to facilitate operational cooperation between the Indian and the French security forces in the littoral. He advocated longterm partnership between India and France to shape the geopolitics of Eurasia and the Indo-Pacific. For their part, the British and French scholars also advocate cooperation with India at the trilateral as well as multilateral levels with two European partners—the British and the French. For instance, Isabelle Saint-Mézard suggests that the Varuna bilateral exercises between the Indian and French navies should be opened up to the UK and the resultant ‘trilateral exercises between the Indian, British and French navies would prove a milestone in the progressive development of a maritime security rapprochement between India and Europe in the Indian Ocean’ (Saint-Mézard 2015: 118). Like-minded nations in the IndoPacific region such as Japan and Australia may also be brought under this arrangement. Like France, the UK should also develop new ties with India leading to exchange of mutual access to naval bases and even develop UKIndia-France trilateral maritime cooperation in order to achieve ‘Global Britain’ in the Indo-Pacific (Hemmings 2018: 33). European scholars advocate that apart from forging closer military ties with the UK and France militarily, India should shed its aversion towards the European Union and to overcome its ‘EU blindness’ if it wishes to ensure long-term stability in the Indian Ocean. The Union may prove to be an invaluable partner in tackling the day-to-day technical problems related to its governance (Pejsova 2019). The EU can also provide the normative underpinning and greater legitimacy to the Indo-Pacific construct. It is well-suited to play an effective role in the fluid traditional as well as non-traditional security environment in the Indo-Pacific region and to bring a stabilizing element with its neutral security profile and good relations with all the powers involved. The EU’s ‘regulatory power’ and contribution to the promotion of ‘a rules-based order and cooperative security initiatives’ could prove a game changer (Pejsova 2018: 4).

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Middle Powers in the Indo-Pacific A more assertive China and the uncertainties created by the Trump Administration provide an opportunity for middle powers to play a role in the Indo-Pacific. An Indo-Pacific axis with middle powers like Australia, France, India Japan and the UK can contribute to regional stability through multi-dimensional cooperation and coordination (Mishra 2019, 5 June). Though none of these middle powers have the capacity, capital or the resources to play a dominant role individually in all the sub-regions of the Indo-Pacific, they can through collective actions and burden sharing muster enough capabilities to face and tackle the common challenges and to shape an authoritative Indo-Pacific narrative. If the middle powers use strategic islands across the Indo-Pacific such as Okinawa (Japan), Cocos Keeling (Australia), Andaman and Nicobar (India) and La Reunion (France), which are strategically located close to key chokepoints, lines of communication and to potential hotspots, having access to them would become possible, thereby allowing these middle powers to be present and operate in areas far away from shores. Thus, there are substantial benefits in a collaborative issues-based approach (Baruah 2019, September: 40–44).

Response of ASEAN to the Role of Middle Powers With the prospects of Chinese domination and American indifference, Southeast Asian leaders have welcomed the activities of middle powers in enhancing their cooperation and coordination in the Indo-Pacific in general and Southeast Asia in particular. Though India could not score much in the combined ‘positive responses’ of the respondents, Southeast Asians have a positive view that the European Union will ‘do the right thing’. In the ‘trust’ rankings of the major powers based on the combined ‘positive responses’ of the respondents, Japan scores 65.9% followed by the EU with 41.3% (ISEAS 2019: 27–28, 31). However, the EU and its member states including the UK and France are considered as extra-regional powers. The French assertion that it is a resident IndoPacific power is considered by Southeast Asian countries as somewhat unconvincing since the French territories Paris are, in effect, ‘an enduring French colonial legacy’. As a result, French claims of ‘an inherent French territoriality in the Indo-Pacific’ appear to have fallen flat in Asia (Panda 2019). Playing a ‘normative’ role in preserving the Indo-Pacific region

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as a peaceful, stable, free, open and inclusive region and projecting the regional powers like India and Japan along with Australia as partners and frontrunners may help the European countries to mitigate the ill-effects of the extra-regional power label.

Conclusion The Indo-Pacific region is going to be the defining feature of the present century for both regional and extra-regional powers. Politico-economic stability in its maritime domain is crucial and paramount for international security and any crisis/conflict in this area is likely to adversely affect the economic interests and security imperatives of almost all global powers. China’s assertive incrementalism in the South China Sea and its ambition to establish a China-centric world order has apparently left regional powers, especially the Southeast Asian countries, in a somewhat precarious condition. The American withdrawal from the scene with occasional deployment of their naval might in the South China Sea, the US-China trade war and American technological competition against China is a cause of concern. There is scope for both regional and extra-regional middle powers to play a significant role in the Indo-Pacific. If they pool their resources to face the challenges, coordinate capacity building programmes, prospects of achieving a peaceful and stable environment and a multilateral rulebased order in the Indo-Pacific region may improve.

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CHAPTER 8

India, Europe/the European Union and West Asia Anil Wadhwa

A subject as vast as this requires a bird’s eye view of all recent developments in this volatile region of the world. The issues dealt with in this chapter have therefore to be selective, but best illustrate the complexities of the region.

Historical Relations As opposed to the terminology of ‘Middle East’ used by the Europeans which in turn is based on British naval war strategy, India regards ‘West Asia’ as comprising three sub-regions, viz. the Gulf, West Asia or Mashreq and North Africa or the Maghreb (Abhyankar and Pourzand 2013: 2). India has interacted with the Persian, Arab and Turkish civilizations since ancient times. India’s relations with the Arabs and the Islamic world are rooted in history and culture. They have been characterized by an interactive exchange of ideas, goods, services and people. The ancient Arabs had an intimate knowledge of the Indian civilization through the

A. Wadhwa (B) Former Secretary (East), Ministry of External Affairs, New Delhi, India © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 R. K. Jain (ed.), India, Europe and Asia, https://doi.org/10.1007/978-981-33-4608-6_8

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access their scholars enjoyed to Indian schools of thought and scholarly traditions. India’s historical connection with the Gulf states in particular can be traced back 5,000 years, when the Indus Valley traded with Dilmun (linked with present-day Bahrain). The Indian Rupee was legal tender in Kuwait, Bahrain, Qatar, Oman and the trucial states (now the United Arab Emirates [UAE]) till the 1960s and the 1970s of the twentieth century. By the late fifteenth century, the Portuguese dominated the maritime routes in the Indian Ocean and competed with the Ottoman and other Muslim states for control of the sea trade. Growing Portuguese influence also affected the Arab spice trade to Europe via the Red Sea. Portuguese navigators tried to cut the Red Sea out and establish an independent connection to India. In modern times, the Arabs and Indians were again united in the struggle against European colonialism (Doha Institute, Arab Centre for Research and Policy Studies) and India’s independence in 1947 and its non-alignment brought about linkages of liberty, unity and socialism into this relationship (Abhyankar and Pourzand 2013: 2).

The Colonial Powers and the Political Structure of West Asia In colonial times, protection of commercial interests was paramount, and a Pax Britannica was put in place through a series of treaties banning maritime warfare with the sheikhdoms of present-day United Arab Emirates. These became known as the ‘Trucial states’. A ‘perpetual maritime truce’ was signed in 1853 with the rulers of present-day UAE and Oman, to which Bahrain and Qatar acceded in 1861 and 1916, respectively. The seeds of current tensions with Iran were sown at this time, with Britain handing three previously Iranian islands to what would become the UAE. The British also issued the Balfour Declaration during the First World War announcing support for the establishment of a ‘national home for the Jewish people’ in Palestine, then an Ottoman region with a small minority Jewish population—sowing the seeds of yet another intractable conflict. In World War I, the British and its allies defeated the Ottoman Empire which was allied with the Central powers and partitioned it into a number of separate nations, initially under French and British mandates. Israel was established in 1948 and the Europeans, notably the French and the British departed from the region by the end of the 1960s. The influence of the

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United States rose in the region since the 1970s. The Soviet Union was an effective counterweight to American influence during the Cold War. Today, Russia is attempting to come back to the region in a similar role (Vagneur-Jones 2017). In January 1968, the United Kingdom withdrew its troops from the Gulf, which led to the emergence of now independent UAE, Qatar and Bahrain. The UK Royal Navy has maintained a presence in the Gulf since the 1980s. London signed a Defence Cooperation Agreement with the UAE in 1996. The UK trains the House of Saud’s praetorian guardcum-auxiliary force. Since 1971, the Gulf states have been training their personnel in Britain, especially in institutions like Sandhurst. The UK has been setting up or investing in pre-existing military bases through the region as part of the strategy to ‘tackle extremism’. In 2009, military installations were opened up in the UAE for use by British forces. The Al Minhad airbase, located south of Dubai, has since been upgraded to facilitate the withdrawal of British troops from Afghanistan. The UK signed a defence cooperation agreement with Bahrain in 2012. In March 2016, the UK and Oman agreed to the deployment of 45 UK training teams, and after 2019, UK troops redeployed from Germany will join them. The UK is seeking to further develop a naval facility at the Duqm port in Oman for a wider naval presence in the area. In November 2016, the HMS Juffair, a naval support facility for the UK opened in the Mina Salman port in Bahrain, which is home to mine hunter warships. To date, Qatar has invested £40 billion in the UK. Saudi Arabia is the Britain’s foremost trading partner in the region. Typhoon fighter bombers sold by the UK have played a key role in the Saudi war on Yemen. Qatar has also earmarked £5 billion to be invested in Britain’s transport, property and digital technology sectors over the next five years. France has been continuously active in the region. It has strong political ties, close economic relations as well as a major military presence in the region (see Rapnouil 2018). West Asia’s significant crude oil reserves and mass production by Saudi Arabia, Iran, Kuwait, Iraq and the United Arab Emirates gave the region, with two-thirds of the world’s oil reserves, greater geopolitical importance. Throughout the twentieth and twenty-first centuries, the region has experienced intermittent periods of conflict between the Sunnis and the Shias. In the present-day context, this has become the most prominent fault line in the region. The traditional rivalry between Sunni Saudi Arabia and Shia Iran has triggered many a conflict in neighbouring countries. In

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fact, the destruction wrought in Iraq and Syria has been influenced to a large extent by this rivalry. Today, both Saudi Arabia and the United Arab Emirates are bombing Yemen incessantly over the past few years (Hildebrandt 2016: 2), because of their conviction that Iran is aiding the Houthi regime. The United States and the European Union have jockeyed for power and also fished in troubled waters, jostling for influence and making all efforts to enhance arms sales to the region. A conflict in the region, therefore, unfortunately suits these aims.

Indian interests in West Asia India has huge interests in the region. Around 11 million expatriates from India live and work in the larger West Asia region. The diaspora is New Delhi’s most distinct soft power asset in the region. Indian workers are known to be peace-loving, tolerant and willing to work under harsh conditions. The Indian diaspora also builds upon, cements, and acts as a present-day reminder to the people in West Asia of the historical and cultural links between the two civilizations. India has evacuated Indian nationals in the Iran–Iraq War (1980) the first Gulf War (1991), the Lebanon–Israel War (2006), the civil war in Libya (2011), and conflicts in Iraq, Libya, and Yemen in 2015. The large diaspora also means that India has to manoeuvre carefully. The size of India’s labour force and logistics also signifies that its diaspora cannot be easily replaced. India has huge investments in Egypt, Jordan, Saudi Arabia, the Gulf Cooperation Council (GCC) and also had large investments in Yemen, Libya, Syria, South Sudan and Iraq which have been affected by conflict. The region, as a whole, accounts for more than 70% of India’s oil and gas requirements. Indian overseas workers remit over $70 billion to India annually and a significant portion is contributed by the increasing number of skilled Indian workers employed in West Asian countries. Any change or reduction in the number of Indian workers in these countries can have a negative impact in India. In recent years, there has been a shift in West Asia’s strategic thinking towards India. There has been the structural change in the global energy market with West Asian oil and gas increasingly heading towards East Asian markets including India rather than to transatlantic markets. West Asia is looking to India and other Asian countries to step into the security space. Many GCC states have welcomed defence cooperation agreements with India. Due to pressure from radical and extremist political forces

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within West Asia, most states of the region have come to value the Indian principles of seeking and securing regional stability. Over the last two decades, the increasing economic enmeshing between India and West Asian countries has meant that the Organization of Islamic Countries (OIC) resolutions on Kashmir were largely side-lined in bilateral interactions (Abhyankar and Pourzand 2013: 34). Investments from the UAE, Saudi Arabia, Oman, Qatar, Egypt and a few countries of the Maghreb have also started to flow into India, strengthening their economies. Saudi Arabia is now India’s strategic partner. New Delhi has also committed itself to a geo-strategic investment in Chabahar in Iran. Close cooperation with the Arab world is essential for India to counter radicalization. West Asia is also a gateway for India to the land-locked and energy-rich Central Asia. Since Independence, India has maintained an equidistant policy in intra-regional conflicts; it has not interfered in divisive issues while supporting the Palestinian cause. India’s focus has been on fostering economic, trade and investment ties as well as enhancing energy security. A key landmark in India’s relationship with the region has been its opening up to Israel in the 1990s. In recent years, New Delhi has sought to enlist the support of West Asia in countering terrorism. India did not take sides during the so-called Arab Spring protests; its constant focus was on avoiding any adverse impact on its energy security, jobs of the Indian workers and remittances from the Gulf. New faultlines have now developed in the region. The Saudi Arabia– UAE combine against Qatar and Iran has many ramifications. It led to fissures within the GCC and the war in Yemen. It engendered greater tension between the region’s traditional monarchies and the ideology of the Muslim Brotherhood. It also exacerbated the conflicting interests of countries in the region vis-a-vis Libya, Syria and Iraq. Moreover, it increased Israel’s influence over some countries of the region. This, in turn, weakened the cause of Palestine and sharpened the Sunni conflict with Shia Iran. The presence of much-frequented trade routes between the Black Sea and the Mediterranean (in Turkey), the Suez Canal which connects the Mediterranean and the Red Sea (in Egypt), the Bab–al Mandeb Strait (between Djibouti and Yemen) and the Hormuz Strait–the gateway to the Persian Gulf (between Oman and Iran) the entire West Asian area assumes considerable importance for trade (Hildebrandt 2016: 2).

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Indian cooperation with the Gulf states in particular, now encompasses defence and naval cooperation, including joint exercises, ship visits, training of armed personnel, etc. All the Gulf states are members of the Indian Ocean Naval Symposium (IONS), which was established in 2008 as a biennial forum of naval chiefs in the Indian Ocean. The Indian Navy has been deployed in the Gulf of Aden continuously since October 2008 for anti-piracy operations. Along with other navies, the Indian Navy has been deployed in the Gulf of Aden and off the coast of Somalia. During these patrols, India has escorted over 3,000 merchant marine ships. There is growing pressure on India to recalibrate its policies and has a larger military presence in the region in order to take care of its energy supplies, its sea lanes of communication, and its large expatriate population, or even to ensure stability in the region. A 2013 poll found that 94% of Indians feel their country should have the most powerful navy in the Indian Ocean, and 89% believe that India should do more to lead cooperation in the region (Lowy Institute 2013). India has so far refrained from taking this step since it is not in conformity with its policy of avoiding alliances, military groupings and participation in non-UN mandated military deployments. Moreover, it would damage its core interests in the region, due to sensitivities, and the need for balancing its economic and connectivity interests. At the 2017 Manama Dialogue, India stated that the four key parameters of its relations in the Gulf comprised being non-prescriptive, nonintrusive, non-judgemental and not taking sides in intra-regional disputes. This has so far enabled India to have close relations with both Iran and Saudi Arabia, Israel and Palestine, and Qatar and Saudi Arabia/UAE and Bahrain (Chowdhry 2018; Kumaraswamy 2019). Increasing multipolarity in West Asia has given rise to new factors which could change India’s behaviour and presence in the region. American disinterest has provided more room for others. Russia is using its role in Syria as leverage in relations with Gulf states. China is translating its economic relationship into strategic ties. Beijing has forged important strategic links with countries as diverse as Saudi Arabia and Iran. It has also increased its naval presence with a base in Djibouti and begun planning an active role in anti-piracy operations. Prime Minister Modi’s ‘Link West’ policy agenda has also evolved into ‘Think West’ with a plethora of bilateral visits. In recent years, India has signed security and defence agreements with Saudi Arabia, the UAE, Oman and Qatar.

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The European Union and West Asia Following the ‘Arab Spring’ protests, the policy of the European Union towards the region sought to encourage political and economic reform in each individual country and foster regional cooperation with the European Union (European External Action Service 2016). Focussing on the southern Mediterranean, in 2011, Brussels supported reform-related steps through financial assistance, enhanced mobility and improved market access. Specific steps were undertaken for countries like Algeria, Bahrain, Egypt, Jordan, Libya, Morocco, Syria, Tunisia and Yemen (European Commission 2011). By and large, Europe is primarily interested in establishing and protecting unhindered maritime trade with Asia and East Africa. Accordingly, European Governments attached prime importance to good relations with both democratic and authoritarian states in the region. At the same time, the best interests of Europe lay in developing trouble-free relations with oil and gas producing countries in West Asia. This means (a) non-intervention in the intra-societal conflicts of the Arab countries and Iran; (b) engaging in diplomatic efforts to settle conflicts between Saudi Arabia and Iran; (c) supplying weapons on the basis of creating a military balance between the two sides; (d) supporting the industrial and infrastructure programmes and projects in these countries in order to improve their capacity to buy more European goods; and (e) an indirect aim is to raise the standard of living in the Arab world and Iran in order to overcome any obstacles posed by Islam (European External Action Service 2018a). By about 2015, however, European involvement witnessed a growing disengagement with half-hearted forms of intervention in countries in the Arab world which experienced some form of protests (Weinthal 2015; Hourcade 2020; Adebahr 2020). European funds were stretched, and meaningful democratic change did not happen (Burke 2013). It is in the interest of both India and the European Union that the region is stable. This implies that the potential fallout of American actions and the imposition of sanctions on Iran should be managed, and that efforts are made for a rapprochement between Saudi Arabia and others against Iran. While the United States can live with sustained turmoil in the West Asia, it is difficult for India and indeed the EU to do so.

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Iran The US decision to abrogate the Joint Comprehensive Plan of Action (JCPOA) with Iran has tilted the scales ever so much towards Israel and Saudi Arabia. This opened up space for Turkey to build its profile, opening military bases in Qatar, and seeking to mobilize public opinion across the entire region. Another fallout of the American stance has been that embattled countries like Lebanon, already scarred by intra-religions schisms, are witnessing political interference from regional actors. Nations with a history of consensus building, like Kuwait, Jordan and Oman, are left to pick up the pieces (Gandhi 2017). The conclusion and implementation of the JCPOA with Iran had opened the way to broaden the European Union’s commercial engagement with Iran in many areas including energy, environment, transport, science and education besides migration and humanitarian aid. European investments in Iran are visible in several sectors including energy, the automotive sector and transport. In 2017, EU imports from Iran went beyond e10.1 billion and exports to Iran peaked at e10.8 billion (European External Action Service 2018b, 8 May). For India, Iran is important because of India’s energy interests, the role it can play in Afghanistan, as well as connectivity to Afghanistan and Central Asia. However, these interests could be adversely impacted by the Trump Administration’s withdrawal from the JCPOA and its sanctions on Iran (w.e.f. 4 November 2018). As the third largest global oil consumer and imports of three-quarters of its oil, India will have assessed how the imposition of American sanctions might affect this supply. But, if it has to comply with sanctions, the system is better prepared, having done so before. Both Indian private and public sector companies engaged in importing oil or involved in the Iranian sector have also been assessing the impact on their operations and their bottom-lines. A surge in oil prices has implications for the Indian economy and the 2019 general elections. Secondly, in the absence of a corridor through Pakistan, India has viewed Iran as a potentially crucial transit route to Afghanistan and Central Asia. This objective—and China’s base in Djibouti and its role in developing the Pakistani port of Gwadar—has shaped India’s desire to invest in upgrading the Iranian port of Chahbahar, which has the potential to become a gateway to Afghanistan, Central Asia and Europe. The contract is for the development and operation for 10 years of two terminals and five berths. India has extended credit lines of $500 million for the

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port and Rs 30 billion for importing steel rails. An MoU has been signed on the provision of services by Indian Railways, including financing to the tune of $1.6 billion for the Chabahar–Zahedan railway line. Indian ships will get access to the Iranian coast, and a rail line to the Afghan border town of Zaranj will provide India a route around Pakistan. The ZaranjDelaram Road constructed by India will give access to Afghanistan’s Garland Highway. The JCOPA and competition from China have given it new momentum. The exact impact on Indian energy and connectivity projects will depend on the details of the sanctions, whether India can get exemptions, on the alternate oil supply scenario, and on the feasibility of alternative payment mechanisms that India and Iran have tried to put in place. It is here that India finds value in engaging with Germany, the United Kingdom, France and other European partners to manage the fallout since the United States and EU are also at loggerheads over the issue. At the end of September 2018, EU Foreign Policy Chief Federica Mogherini stated in New York that the Europeans would set up a ‘legal entity’ for businesses to transfer money without coming under US sanctions. This decision in fact came after a meeting of the Foreign Ministers of China, France, Germany, the Russian Federation and United Kingdom. The new payment system, she said, would assist and provide reassurance to European businesses wishing to continue trading with Iran, mitigating the effect of re-imposed US sanctions, in accordance with European law, and the new mechanism could be opened to other partners in the world (European External Action Service 2018e). US Secretary of State Mike Pompeo stated that he was ‘disturbed and indeed deeply disappointed’ by the EU announcement. Clearly, a peaceful, stable Iran is vital for India’s security interests, for its energy security and connectivity.

Europe and the Saudi Arabia/Qatar Rift Saudi Arabia, the UAE, Bahrain and Egypt have severed diplomatic relations and trade ties with Qatar on 5 June 2017. The Quartet accuses Qatar of close ties with Iran and harbouring ‘terrorism’. A US-backed meeting of the 6-member states of the GCC, Egypt, and Jordan was held in New York on 27 September 2018, but a regional alliance is still stuck because of the blockade against Qatar (Al Jazeera 2018). The United States wants this regional alliance to contain what Washington perceives as Iran’s growing influence in the region. This Gulf disunity has also affected

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efforts towards a settlement of conflicts in Syria and Yemen. The crisis in the GCC has also complicated the situation for Turkey. While it is taking the Qatari side in the dispute, Turkey does not want to sever ties with Saudi Arabia and the UAE due to their aligned interests in regional battlefields and Saudi investments in Turkey. The Turkish-Qatari relationship is a strategic one, especially since the Arab uprisings. Nevertheless, it is dependent on the strong personal ties between the leadership. Therefore, it is susceptible to any domestic political change, especially in Turkey. The limitations of American leadership and mediatory abilities have been revealed in this crisis. While rhetorically President Trump seems more inclined to support the Saudi/Emirati side, the strategic importance of the regional CENTCOM forward headquarters at the Al Died airbase located on Qatari soil (which cannot be used by the North Atlantic Treaty Organization) as well as the strategic dialogue between the Qatari and US governments that began in the early 2018 signal deep institutional ties between the two countries (Szalai 2018: 6). The rift between the conservative monarchies has undermined American efforts to forge a coalition against Iran. The recent killing of Jamal Khashoggi, a severe critic of Wahabi Islam and Mohammed bin Salman by Saudi agents in the Saudi consulate in Turkey, has opened up many possibilities of change in relationships. Washington’s aim is not to let this incident undermine the efforts to garner support in the region against Iran. To that end, Saudi Arabia is an indispensable ally, with its financial clout, influence in the region and its oil resources. Efforts will apparently be made to bring down temperatures, and to keep Crown Prince Mohammed bin Salman insulated from direct blame. The Saudis, after conflicting accounts have now admitted that Khashoggi was killed in its Consulate in Turkey due to a scuffle, and has arrested 15 persons who were sent to confront Khashoggi, plus a driver and two consular staff members. Saudi Arabia has already dismissed the deputy head of its intelligence major General Ahmed Al Assiri, and the head of communications of the royal household Saud Al Qahtani, a close aide of the Crown Prince, and has ordered a revamp of the intelligence setup. Turkey seems to have regained some ground with the United States in importance as a result of the incident. It has quietly released an American preacher and as the host country which is in charge of the investigations can play a key role in the future shape of events around the incident. The Saudis will also need Turkish cooperation in this regard. The Turks have contradicted a Saudi claim that a local collaborator was tasked to dispose of the body, by saying

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that they are working on the theory that the body had been disassembled by a bone saw and carried out in large suitcases. President Trump, not surprisingly, has expressed satisfaction with Saudi explanations, but will be hoping that the Congress does not block lucrative arms sales to Saudi Arabia in the future. The European Union, at the governmental level, despite pressure from its parliaments and civil society, is likely to follow the American line on this issue, and will also be reluctant to rub Saudi Arabia the wrong way. The sharpest reaction so far came from Germany, which demanded that Riyadh clears the issue in a transparent manner and brings those responsible to book. Berlin also has significant ties with Saudi Arabia which includes arms exports. According to official figures, the German Government has authorized arms exports worth $291 million to Saudi Arabia since March 2018. Products like the new Frigate Class 125 and high technology submarines have a market in Saudi Arabia. Siemens and Linde have lucrative economic contracts in the Kingdom in the energy and petrochemical fields. Lately, some reports have surfaced that Saudi Arabia has been reluctant to conclude arms deals with Germany over its sympathy with the Qataris. Private businesses in the United States and Europe may be reluctant to deal with Saudi Arabia, but will have to go along. According to a compilation done by Liz Alderman and Michael J. de La Merced and published by the Economic Times on 20 October 2018, at stake are Saudi investments in private equity company Blackstone (US$20 billion), electric car maker Tesla, the $45 billion promised to Vision Fund of Softbank, a US$10 billion deal entered into by TOTAL, the $14.7 billion worth of French defence deals in the pipeline, the $6.5 billion which BAE systems will earn by selling 48 Typhoon combat jets, the $138.9 billion worth of military contracts awarded to Saudi Arabia under the US foreign military sales rules, the $15 billion deals with General Electric for goods and services, the $500 million which will be awarded to American and French companies for the modern city of Neom, the fees which are being charged by US and Western banks as brokerage among others. There are fears that in the absence of private western capital investing in Saudi Arabia the void could be filled by China, whose companies want to expand internationally, with vast sums of recyclable capital, and little squeamishness about treatment of dissidents. Germany, France and the United Kingdom have a substantial commercial or military presence in the Gulf, they were not parties to the Saudi Arabia/UAE and Qatari rift when it developed. They appealed to both

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sides to settle their differences through dialogue. This has resulted in the impression of them taking a pro-Qatari stance. The weakest response came from the UK, which is wary of antagonizing Saudi Arabia and the UAE despite being the top importer of Qatari LNG in Europe. London therefore seeks to work with the United States, China and Turkey to stabilize the situation. The European Union will have to make greater efforts to monitor the economic activities of the GCC state-owned funds with a view to avoiding the exposure of European markets to intra-Gulf economic competition. There is also a view in the EU that efforts should be made to economically wean Qatar away from Iran (Szalai 2018: 5–6). How and when this can be achieved is, however, unclear. According to a European students think tank assessment of 26 May 2018 (Stavrou 2018), by and large, the EU would like the Kuwait-led mediation efforts to be able to reach a successful conclusion in the matter. If one analyses the trends, European countries are also taking bilateral steps to shore up their position vis-a-vis countries of the region. A case in point is the UK government’s activities in the light of Brexit. 2017 has seen the signing of a £100 million defence agreement with the Turkish air force, and a £117 million loan to Egypt. The UK’s annual trade with the GCC is worth £28.73 billion and the areas provide the strategic means to project power into the Middle East. London is trying its best to bolster and deepen economic and military ties.

India and the Saudi Arabia/Qatar Rift India’s ties with Saudi Arabia have been elevated to a strategic partnership in 2010 (which included robust anti-terror cooperation) and the defence partnership of 2014. Bilateral trade is already US$40 billion. The Saudi government is pitching its mega project, the King Abdullah economic city of Neom with a deep-sea port as a connector between the east and the west, and wants India to see it as a gateway to its new forays into Africa. Saudi Arabia is India’s largest supplier of crude oil, and New Delhi is the largest recipient of foreign remittances from the Kingdom. Nearly 3 million Indians work in Saudi Arabia. Both countries have recently stepped up bilateral cooperation in counter-terrorism and intelligence sharing. Saudi Arabia has extradited several terror suspects to India. The sticking points in the relationship are that while Saudi Arabia denounces all forms of terrorism, Saudi money is funding Wahhabi Islamist groups around the world. Many extremist outfits are inspired by the Wahhabi

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branch of Islam. The aggressive foreign policy of Saudi Arabia is doing great damage to regional stability, which is India’s most important goal in the region. In Syria, the Saudi support for the rebels has played a key role in destabilizing the regime. In Yemen, the war has unleashed chaos and humanitarian catastrophe, creating conditions for radicalism to flourish. With the UAE, Indian bilateral trade was close to US$60 billion in 2015, making it one of India’s biggest trading partners. The relationship, now elevated to a comprehensive strategic partnership, has seen a focus on fighting radicalization and misuse of religion. The UAE has lent its support for the Comprehensive Convention on International Terrorism and to the Indian candidature for a permanent seat in the UN Security Council (see Pradhan 2020). Qatar is also an important source of oil and LNG with bilateral trade standing at US$15 billion. An MoU has been signed between the National Investment and Infrastructure Fund (NIIF) and the Qatar Investment Authority for facilitating participation of Qatari institutional investors in infrastructure projects in India under NIIF. Indians comprise the single largest group of migrants in Qatar. India therefore would like the conflict to end, and stability restored in the GCC. A fallout of the Saudi/Iran rivalry is the disastrous war in Yemen, unleashed by a coalition of nine Arab states and led by Saudi Arabia and the UAE. Saudis fear that the Houthi advance in Yemen is militarily, financially and politically aided by Iran and that it will result in Shia minority rebels seizing control of the whole of its Sunni majority neighbour and take it into the orbit of Shia Islam. The airstrikes in Yemen began on 25 March 2018. After years of relentless bombing, the Houthis still hold the capital city and control pockets in western Yemen. The stateless chaos amid a disastrous war has helped Al Qaeda expand its footprint steadily in the country and the country is also facing a serious humanitarian crisis. Again, wary of annoying Saudi Arabia, and with little commercial stakes in Yemen, the EU has hidden behind the fact that it is only the United Nations which can provide a framework for last peace in Yemen, and it supports to efforts of the UN Special Envoy.

Syria In Syria, the EU’s stand has been that only a negotiated political settlement, as defined in UN Security Council Resolution 254 and the 2012 Geneva communique, will ensure lasting stability in Syria, and the elimination of Daesh and other UN listed terrorist entities in the country. The

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Union is the main humanitarian donor for the Syrians, with over e10.8 billion mobilized collectively with EU member states in humanitarian, development economic and stabilization assistance. The EU Strategy for Syria (endorsed on 3 April 2017 and re-endorsed in April 2018) has six strategic objectives: • an end to the war in line with UNSCR 2254; • to promote a meaningful and inclusive transition in Syria through support for the strengthening of political opposition; • to save lives through humanitarian assistance across Syria; • to promote democracy, human rights and freedom of speech by strengthening Syrian civil society organizations; • to promote accountability for war crimes with a view to facilitating a national reconciliation process and transitional justice; and • to support the resilience of the Syrian population and Syrian society (European External Action Service 2018c, 24 September). Russian President Vladimir Putin has injected Russia into West Asia and he has managed to stabilize Bashar al-Assad’s Syria, and routed the Islamic State. Moscow has emerged as a major dealmaker in West Asia; it is open to making deals with partners ranging from Israel, Saudi Arabia and Iran. The European Union wants the Asthana guarantors, viz. Russia Iran and Turkey, to ensure the cessation of hostilities and unhindered safe and sustainable humanitarian access throughout all of Syria. Brussels has opposed a Russian-backed regime offensive in the southwest of Syria which it argues has led to widespread displacement. The EU has supported the UK in the Organization for the Prohibition of Chemical Weapons (OPCW) which adopted a decision on 27 June 2018 condemning the use of chemical weapons by the Syrian regime and by Daesh and mandating the OPCW to identify those responsible for the use of chemical weapons. On the other hand, the Indian stand on the Syrian issue is that societies cannot be reordered from outside and that people in all countries have the right to choose their own destiny and decide their own future. In line with this stand, New Delhi has always supported an all-inclusive Syrian-led process to chart out the future of Syria as well as its political structures and leadership. It was India, along with the other BRICs (Brazil, Russia, India, China and South Africa) countries, which advocated non-interference in

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Syrian affairs. The stand of the United States and Western countries and their allies as well as various countries in the Gulf has been to support the opposition forces, many of whom live abroad with little contact with reality of the ground. The support of the Gulf states to various groups of their choosing has resulted in a political cauldron in Syria, with disastrous consequences.

Palestine and Israel Via the Middle East peace process, the European Union has been supporting efforts to resolve the Israeli-Palestinian conflict and is also a member of the Middle East Quartet (the EU, Russia, the United States and the United Nations) which has been ineffective for a while. Brussels’ objective is a two-state solution based on 1967 borders with an independent, democratic, viable and contiguous Palestinian state living side-by-side in peace and security with Israel and its other neighbours. The EU seeks security arrangements for the Palestinians, which respects their sovereignty and shows that the occupation is over. For the Israelis, Brussels seeks security arrangements which protect their security, prevent the resurgence of terrorism and deal effectively with security threat. The European Union also wants a fair, agreed and realistic solution to the refugee question. Brussels has recently urged Israel to open the crossing points in Gaza in order to reinvigorate the Gazan economy. The EU supports efforts to bring Gaza and the West Bank under a single Palestinian authority. It also opposes the Israeli policy on settlements and advocates Jerusalem as a joint capital for Israelis and Palestinians. There have been strains recently in the EUs relations with Israel, over its policy towards Israeli settlements, and EU support to groups which subscribe to the boycott, divestment and sanctions on the movement of Israeli goods. On Palestine, India’s policy is that of extending strong support to the Palestinian cause, while maintaining good relations with Israel. New Delhi supports a comprehensive resolution of the Palestinian issue, leading to a sovereign, independent, viable and united state of Palestine, living within secure and recognized borders, side-by-side and at peace with Israel, as endorsed in the Quartet roadmap and relevant UN Security Council resolutions. India has repeatedly called on both sides to resume the peace process. In 1947, India voted against the partition of Palestine at the United Nations General Assembly. India was one of the first countries to recognize the State of Palestine in 1988.

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Apart from the strong political support to the Palestinian cause at international and bilateral levels, India has been contributing material and technical assistance to the Palestinian people for many years. At the same time, India’s relations with Israel have prospered with the personal chemistry between Prime Minister Narendra Modi and Prime Minister Benjamin Netanyahu. Indo-Israeli cooperation in defence, agriculture, science and technology collaboration and dialogues between the strategic forces and security establishments are growing areas of convergence (see Pate 2020). In the changed geopolitical scenario where the United States under President Trump is no longer seen as an honest broker, where India is seen as close to both Israel and Palestine and the Quartet process has been put on the back burner, New Delhi is now positioned to play a much larger role in building peace between Israel and Palestine and in the broader Middle East. Mahmoud Abbas has already proposed a ‘multilateral forum’ for negotiations on a peace deal between Palestine and Israel. Given the divergence of the EU with the Trump Administration’s positions on Jerusalem as the capital of Israel, and on the Israeli settlements, the Indian position has come closer to that of the European Union (Pethiyagoda 2017).

Turkey The Turkish role in the region has been one played by a maverick, and without much scruples. The jihadi highway that Recep Tayyip Erdogan opened up on the Turkey-Syria border for radicalized Europeans, Central Asians, Afghans, Arabs and Africans in return for payments to enter Syria created a backlash, but only after the damage had been done. As far as Indo-Turkish relations are concerned, a modest trade of US$7 billion is not enough to overcome structural differences. Turkey’s position on Kashmir has traditionally reflected its proximity to Pakistan guided by links between the two military establishments. OIC membership is also a common link that Ankara has with Pakistan. On the issue of expansion of the UN Security Council, both Turkey and Pakistan are part of the United for Consensus group which opposes the idea of adding new permanent members. On membership of the Nuclear Suppliers Group, Turkey supports the Chinese view of a criteria-based approach for the NPT non-member states which is intended to help Pakistan.

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Ankara and Brussels are keeping the pretence of membership negotiations, though both sides know that it is a dead-end street. Although on 26 June 2018, two days after elections in Turkey, EU Foreign Ministers concluded that talks had come to a standstill, and that no further work towards the modernization of the EU–Turkey customs union is foreseen. Still, none of the sides want to pull the plug on the talks. The EU is still Turkey’s main trading partner. Europe is in the lead in foreign direct investment—$4.85 billion or 62% of the total. Both are firmly linked economically. Turkey is a member of NATO. Ankara is well aware that the process of EU membership is going nowhere, but it hopes to upgrade the customs union, in place since 1996, and get a better deal in agriculture, trade in services, and public procurement. The Schengen visa is in big demand in Turkey. Ankara receives payments from the EU budget as precession support, (currently e4.5 billion) allocated for the 2014–2020 period (about e740 million per year) (Wikipedia: Foreign Relations of the European Union: Africa and Middle East). The Europeans have shown an appetite to strike side deals with Turkey. The 2016 agreement on asylum seekers, involving the transfer of $3.3 billion has by and large, worked. And there is an interest to extend it. At the European Council meeting on 29 June 2018, which focused considerably on containing migration, EU Member States agreed to go ahead with the transfer of another $3.3 billion for the EU facility for refugees in Turkey. This is an unstated fact, but the Europeans will benefit from the Turkish push to carve a territory in northwest Syria under Turkish control. Northern Aleppo, Afrin, and possibly, the Idlib governorate might turn into a buffer zone containing potential refugees. Turkey also remains indispensable for the EU effort to boost its energy security. The trans-Anatolian pipeline which was inaugurated on 12 June 2018, marks a key step in completing the southern gas corridor, linking European consumers to the energy producers in the Caspian region and beyond, thereby minimizing dependence on Russia. The EU therefore sees Erdogan as an adversary with whom they are forced to talk due to the circumstances (Bachev 2018).

The Issues of Migration The problems of West Asia—terrorism, the rising tide of migration, hotspots like Syria, Libya or the Iranian question—all are affecting Europe directly. The political map of the region, determined by colonial European

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powers like the United Kingdom and France was set by the same countries after the Second World War. Algerian extremists have affected France in the 1990s, but today the globalized world offers better connectivity and movement. European citizens themselves have travelled to join the Islamic State. Alienation, radicalization and petty crime are all apparent in the suburbs of European cities where immigrants of former colonies live. Domestic politics are also affected. There is rise of populist and nationalist parties in Scandinavia, and in countries like France, Germany and Italy. By any measure, the European Union’s handling of a vast influx of migrants from Africa and West Asia has shown a total lack of a coordinated approach (Marcus 2016). The EU has no common asylum policy leaving it to the country of first entry. This places a disproportionate burden on the Mediterranean countries such as Italy, where high search and rescue costs have engendered popular discontent. Only 2.6% of the EU budget goes to managing migration and security. Helping migrants find jobs is another challenge, leading to discontent.

Libya Libya, which is in chaos since Muammar Gadhafi was overthrown in 2011, has become the focus of attention as far as migration issues are concerned for the EU. There is much credence in the theory after all these years, that Gadhafi’s anti-US and in general anti-West policies as well as his desire to carve a niche for Libya in African affairs, which would deny access to the United States and EU to Libyan oil and mineral wealth were primarily responsible for the regime change. Brussels supports the UNled mediation process and efforts of the Special Representative Ghassam Salame to implement the UN Action Plan on Libya. It also works with the UN Support Mission in Libya (UNSMIL) to support the implementation of the Libyan political agreement, consolidation of governance, security and economic arrangements and assist in preparing for elections through the High National Electoral Commission. Brussels is also coordinating with neighbours and regional partners including the League of Arab States, the African Union, and the United Nations in the framework of the Libyan Quartet to advance the political process to assist Libya in its democratic transition (European External Action Service 2018d). However, there is a fundamental conflict of interests within the EU, primarily between France and Italy. Migration is the biggest focus for Italy, which faces the migration issue primarily from Libya squarely, while

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terrorism is the key French concern. In the process, both Italy and France, as well as other players in Libya today, want to benefit economically from the situation (see Theron 2019). An Italian-led effort resulted in the EU asking in June 2018 for screening for potential refugees to be done at detention centres in Libya itself. This proposal was rejected by the Libyan Foreign Minister of the UN-backed government of National Accord Al Taher Siala who has conveyed that instead, Libya will work with its southern neighbours— Chad, Niger and Sudan—to reinforce their common borders. The Libyan Government is nominally in power in Tripoli, but rival political factions and the militia occupy much of the rest of the country. The EU and the Arab League are scheduled to hold talks in Egypt in February 2019 with illegal migration high on the agenda. The EU strategy is to boost development in sub-Saharan Africa to mitigate the conditions that drive migration. The French are trying to get together all major players, including the United Nations and the EU as well as Libyan political leaders including Ageela Saleh, head of House of Representatives in Tobruk, Khaled Meshri, Head of the High Council of State in Tripoli, Fayez Serraj, the Head of the Presidential Council, and Khalifa Haftar, as head of the Libyan National Army in the east of Libya. The objective is to commit them to an agreement under UN auspices and start arrangements for staging elections before end of 2018. Italy is wary of France and sees it as trying to take full ownership and recognition for resolving the conflict. The Italian and the American view is that elections should not be held before a constitution is adopted through a national referendum. The Italians see their own interests being sidelined, which focus primarily on stemming the flow of migrants across the Mediterranean and the supply of Libyan gas as well as other commercial gains for Italian companies. France is also actively pursuing commercial gains in Libya. Recently, the French energy company TOTAL substantially raised its presence in the Libyan energy market with the purchase of 16.3% stake in Libya’s Waha concession worth US$450 million. Both the Italians and the Libyans do not regard France as an honest broker given its military and logistical support for Haftar and close alignment with the UAE and Egypt—the main Arab supporters of Haftar. Paris has maintained close contacts with local tribal forces in Ferraz, which is positively rich in reserves of oil, gas and minerals, including uranium. It offers France a

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geographical extension of its presence in Chad, Niger and Mali in which France has a strong military, economic and political presence. Many, therefore, see French moves as an effort by France, the UAE and Egypt to allow Haftar to take over. Meanwhile, Italy has concluded many deals with militias in Libya to stop migrants, which have come under criticism from human rights bodies and organisations (Gamaty 2018). Contrast this with the Indian position on Libya. India enjoyed excellent political and commercial relations with Muammar Gadhafi. At the beginning of civil war, there were 18,000 Indians in Libya. During the Libyan civil war, India abstained from voting on Security Council Resolutions 1970 and 1973 that authorized NATO action in Libya. India sent two naval ships and carried out 50 air sorties to evacuate its nationals from Libya. Yet, 1,500 Indians still stayed back in Libya. India’s response to the killing of Gadhafi was also criticized as being muted. Although India was one of the last countries to recognize the Libyan National Transition Council, it agreed to work with the Council to help rebuild Libya and maintained an Embassy there till 2015 before shifting it to Djerba, an island in Malta and later to Tunisia.

US-EU Relations and West Asia While there is a common transatlantic understanding between Europe and United States on the main threats to peace and stability in the region, the United States and Europe diverge most significantly in their approach on Iran’s long-term ambitions and the generational Israeli-Palestinian conflict. A successful cooperation model was achieved in Syria—in the form of cooperation between the two in the global coalition to defeat ISIS which was formed in September 2014 after the self-proclaimed ISIS swept through large territories in Iraq and Syria. Its architecture involves burden sharing, regional involvement and an efficient division of labour. Despite growing US tensions with NATO members, the launch of a new NATO training mission in Iraq was announced at the July 2018 NATO Summit, underscoring the durability of cooperation in this area. The United States and Europe share multiple counter-terrorism interests: returning foreign fighters, and countering the spread of online radicalization are the main ones. There is a need for continued cooperation on intelligence sharing, interdiction, prevention and shared lessons learned on best practices. The generational challenge posed by the fallout from the Arab Spring uprisings remains a task to be addressed within the

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Arab world. The United States and Europe, however, have an interest in bringing stability to the region. France has asserted more of a leadership role in Libya, while the United States maintains the lead in Iraq. Yemen is a fit case for transatlantic cooperation. In Tunisia, there is need to leverage synergies in assistance, insuring against competition and redundancies on the ground. When the Qatari crisis broke out, it was the United States which was the first country to be contacted by the Qataris. For the foreseeable future, the United States will also remain the preponderant military power in the West Asia, with 40 warships including nuclear-powered supercarriers (Yacoubian 2018). The Russian and Chinese presence in the region is growing. As more states in the region feel the economic strain of falling oil prices and rising unemployment, they will look to diversify their dependence on the United States to other countries with influence. This region could then see heightened rivalries, tensions and competition.

References Abhyankar, R. M., & Pourzand, A. (2013, March). Protests and Possibilities: West Asia and India (Gateway House Research Paper No. 8). Mumbai: Gateway House. Adebahr, C. (2020). Europe Needs a Regional Strategy on Iran. Washington, DC: Carnegie Endowment for International Peace. Al Jazeera (2018, September 28). Qatar’s Top Diplomat Says Gulf Crisis at a “Stalemate”. Retrieved October 18, 2018, from: https://www.aljazeera. com/news/2018/09/gcc-nations-hold-meeting-gulf-rift-erupted-180928 140728432.html. Bachev, D. (2018, July 10). What Lies Beneath the Hostile Rhetoric in Turkish-EU Relations? Al Jazeera. Retrieved October 18, 2018, from: https://www.aljazeera.com/indepth/opinion/lies-hostile-rhetoric-tur kish-eu-relations-180617164432287.html. Burke, E. (2013, December). Running into Sand? The EU’s Faltering Response to the Arab Revolutions. Retrieved October 18, 2018, from: https://www.cer. eu/publications/archive/essay/2013/running-sand-eus-faltering-responsearab-revolutions. Chowdhry, R. R. (2018, August 29). India and the Gulf Region: Building Strategic Partnerships. Retrieved October 18, 2018, from: https://www.iiss. org/blogs/analysis/2018/08/india-gulf-strategic-partnerships. Doha Institute, Arab Centre for Research and Policy Studies, ‘Indo-Arab Relations’. Retrieved October 18, 2018, from: https://www.dohainstitute.

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org/en/Lists/ACRPS-PDFDocumentLibrary/English%20Backgrounder% 20for%20the%20Indo%20Arab%20Conference%20APPROVED%20MK.pdf. European Commission. (2011, December 16). The EU’s Response to the “Arab Spring” (Memo/11/918). Retrieved October 18, 2018, from: https://eur opa.eu/rapid/press-release_MEMO-11-918_en.htm. European External Action Service. (2016, June 15). Middle East and North Africa (MENA). Retrieved October 18, 2018, from: https://eeas.europa. eu/headquarters/headquarters-homepage_en/336/Middle%20East%20and% 20North%20Africa%20(MENA. European External Action Service. (2018a, April 26). EU Statement—United Nations Security Council: Situation in the Middle East, Including the Palestinian Question. Retrieved October 18, 2018, from: https://eeas.europa.eu/ delegations/un-new-york/43591/eu-statement-%E2%80%93-united-nationssecurity-council-situation-middle-east-including-palestinian_en. European External Action Service. (2018b, May 8). Iran and the EU . Retrieved October 18, 2018, from: https://eeas.europa.eu/headquarters/headquart ers-homepage_en/2281/Iran%20and%20the%20EU. European External Action Service. (2018c, September 24). Factsheet: The EU and the Crisis in Syria. Retrieved October 18, 2018, from: https://eeas.europa. eu/headquarters/headquarters-Homepage/22664/eu-and-crisis-syria_en. European External Action Service. (2018d, September 24). EU-Libya Relations. Fact Sheet. Retrieved October 18, 2018, from: https://eeas.europa.eu/hea dquarters/headquarters-homepage_en/19163/EU-Libya%20relations. European External Action Service. (2018e, September 25). Iran Deal: EU and Partners Set up Mechanism to Protect Legitimate Business with Iran. Retrieved October 18, 2018, from: https://eeas.europa.eu/headquarters/headquart ers-homepage/51066/iran-deal-eu-and-partners-set-mechanism-protect-legiti mate-business-iran_en. Gamaty, G. E. (2018, May 29). Libyan Conflict: Is France an Honest Broker? Middle East Eye. Retrieved October 18, 2018, from: https://www.middleeas teye.net/columns/france-honest-broker-libya-conflict-298155148. Gandhi, V. (2017, December 25). Why West Asia Could Present India with Many Opportunities. The Economic Times. Retrieved October 18, 2018, from: https://blogs.economictimes.indiatimes.com/et-commentary/ why-west-asia-could-present-india-with-many-opportunities/. Hildebrandt, R. (2016, September). Potential for Long-Term European-Indian Cooperation in the Middle East (FEPS Policy Brief), p. 2. Hourcade, B. (2020). Iran and Europe: The Never-Ending Hope for Strong and Efficient Relations. In H. Gartner & M. Shahmoradi (Eds.), Iran in the International System: Between Great Powers and Great Ideas. London: Routledge. Kumaraswamy, P. R (2019). India’s New Israel Policy (SWP Comment, no. 11).

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Lowy Institute. (2013). India Poll 2013. Retrieved November 23, 2019, from: https://www.lowyinstitute.org/publications/india-poll-2013. Marcus, J. (2016, March 23). The Middle East Is Now Europe’s Backyard. Retrieved October 18, 2018, from: https://www.bbc.com/news/world-eur ope-35883464. Pate, T. (2020). Re-(Modi)fying India’s Israel Policy: An Exploration of Practical Geopolitical Reasoning Through Representation of ‘India’, ‘Israel’ and ‘West Asia’ Post-2014. Journal of Security and International Affairs, 7 (1), 7–35. Pethiyagoda, K. (2017, April 24). India’s Shifting Role in the Middle East. The National Opinion. Retrieved October 18, 2018, from: https://www.thenat ional.ae/opinion/india-s-shifting-role-in-middle-east-affairs-1.50968. Pradhan, P. K. (2020). India-UAE Security Ties: Moving Towards an Enduring Partnership. Strategic Analysis, 44(2), 125–136. Rapnouil, M. L. (2018, April 10). Alone in the Desert? How France Can Lead Europe in the Middle East. European Council on Foreign Relations. Retrieved October 18, 2018, from: https://www.ecfr.eu/publications/sum mary/alone_in_the_desert_how_france_can_lead_europe_in_the_middle_east. Stavrou, A. (2018, May 26). Qatar-Gulf Crisis What Does the EU Stand For? Retrieved October 18, 2018, from: https://www.esthinktank.com/2018/ 05/26/qatar-gulf-crisis-what-does-the-eu-stand-for/. Szalai, M. (2018, September). The Crisis of the GCC and the Role of the European Union (Menara Future Notes, No. 18). Retrieved October 18, 2018, from: https://www.iai.it/sites/default/files/menara_fn_14.pdf. Theron, J. (2019). French Foreign Policy in Libya and Syria (2003–2017): Strategic Adaptability in Quickly Changing Environments. In C. Cakmak & A. Ozcelik (Eds.), The World Community and the Arab Spring (pp. 205–223). Cham: Palgrave Macmillan. Vagneur-Jones, A. (2017, July 19). Global Britain in the Gulf: Brexit and Relations with the GCC (Note de la FRS No. 13). Retrieved October 18, 2018, from: https://www.frstrategie.org/publications/notes/global-britainin-the-gulf-brexit-and-relations-with-the-gcc-13-2017. Weinthal, B. (2015, December 20). Five Years Later: How the US and EU Failed the Arab Spring. The Jerusalem Post. Retrieved October 18, 2018, from: https://www.jpost.com/Middle-East/Five-years-later-How-theUS-and-EU-failed-the-Arab-Spring-437819. Wikipedia: Foreign Relations of the European Union: Africa and Middle East. Retrieved October 18, 2018, from: https://en.wikipedia.org/wiki/Foreign_r elations_of_the_European_Union#Africa_and_the_Middle_East. Yacoubian, M. (2018, August 15). Transatlantic Aims Overlap in the Middle East. Retrieved October 18, 2018, from: https://www.cfr.org/blog/transa tlantic-aims-overlap-middle-east.

CHAPTER 9

India, the European Union and Iran Patryk Kugiel

Introduction The 2017 EU-India Joint Statement dedicated a long paragraph (17) to Iran. Both sides ‘reaffirmed their support for the continued full implementation of the Joint Comprehensive Plan of Action (JCPOA) regarding the Iranian nuclear issue’ and ‘called for the full and effective implementation of the deal, which has been endorsed by the UN Security Council and is a crucial contribution to the non-proliferation framework and international peace, stability and security’ (European Commission 2017: 3). Joint statements of earlier summits had also regularly included similar expressions of cooperation regarding the Iranian nuclear programme. How is it possible that so different players with distinct positions regarding non-proliferation and diverse relationships with Iran see eye-to-eye on this issue? Can the EU and India do anything together to help save the Iran nuclear deal? Can they play a role in mitigating current tensions between the United States and Iran and help avoid another war in the Middle East? Do India and the European Union have other similarities in their approaches towards Iran?

P. Kugiel (B) Polish Institute of International Affairs (PISM), Warsaw, Poland e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 R. K. Jain (ed.), India, Europe and Asia, https://doi.org/10.1007/978-981-33-4608-6_9

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This chapter examines the relations of the European Union and India with Iran in the post-Cold War period. After a brief overview of how Iran figures in EU and Indian foreign policy, the chapter makes a comparison of their cooperation with Iran in three crucial areas—nuclear programme, energy and trade, as well as other strategic concerns. It concluded that there is more scope for India and the EU to cooperate on the Iran dossier. This is becoming more pressing given the unpredictable policy of the Trump Administration. It could even give them an opportunity to put their complementary diplomatic skills to better use.

The European Union and Iran Though many European countries have had long and often cordial relations with Iran, Tehran’s relationship with the European Union dates back only to 1992, when the Edinburgh Declaration called for a ‘critical dialogue’ with Iran. This dialogue initially dealt with primarily human rights and terrorism. It subsequently evolved in to ‘comprehensive dialogue’ when the more moderate Mohammad Khatami become the President of Iran in 1997 and enabled broader engagement (Hunter 2010: 82), which facilitated greater trade, economic and energy cooperation. The short period of optimism was put to a test, however, when news of the Iranian nuclear programme (including undeclared nuclear sites at Arak and Natnaz) emerged in 2002. The subsequent twelve years were a time of tense relations centred around Iranian nuclear ambitions. EU-Iran relations suffered a setback when anti-Western President Mahmud Ahmedinejad came to power in 2005 (Osiewicz 2018: 155). Ties hit a new low with the re-election of Ahmedinejad in 2009 and the suppression of the Green Movement what led Brussels to impose human rights-related sanctions on members of the Iranian establishment. EUIran relations reached their nadir when Brussels imposed a fresh set of nuclear-related sanctions in 2011 and 2012. Some degree of rapprochement with the West, including Europe became feasible when President Hasan Rouhani came to power in 2013. Next year, Iranian Foreign Minister Javad Zarif stated that Iran would engage with European countries and other Western states with ‘the goal of reinvigorating and further expanding relations’. However, this normalization process, he added, must ‘be based on the principles of mutual respect and mutual interest, and it must address issues of legitimate concern to both sides’ (Zarif 2014: 10).

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Progress on nuclear talks with Iran eventually led to the signing of a nuclear deal in July 2015 (known as the Joint Comprehensive Plan of Action) and the beginning of a new chapter in EU-Iran relations. Following a confirmation by the International Agency for Atomic Energy (IAEA) that Iran had fulfilled its nuclear obligations under the JCPOA, all EU economic and financial sanctions imposed in connection with the Iranian nuclear programme were lifted in January 2016. This opened the way for greater engagement in additional sectors. In April 2016, the High Representative of the European Union for Foreign Affairs and Security Policy, Federica Mogherini, led a large delegation consisting of seven EU Commissioners to Tehran. In the joint statement, the two sides resolved to deepen cooperation in 17 sectors, including banking, small and medium enterprises (SMEs) and investments. Brussels also agreed to support the greater integration of Iran into the world economy, including through its membership in the World Trade Organization (WTO) (European Commission 2016, 16 April). In the meantime, major European countries organized political and business delegations to Iran, with Daimler and PSA Peugeot Citroën, Siemens, and others eying for big benefits. (Reed 2018) Contracts signed by European companies included a $18–20 billion deal for selling 100 Airbus aircraft in December 2016 (Reuters 2016, 22 December). These deals as well as the normalization of ties were questioned by the subsequent decision of President Donald Trump to withdraw from the JCPOA in May 2018. European countries did not agree with the American president’s criticism of the nuclear deal and resolved to save it despite the unilateral American measures. The United States, Secretary of State Mike Pompeo clarified in Fall 2018, would exert a ‘maximum pressure campaign’ on Iran—stigmatized as an ‘outlaw regime’ and ‘rogue state’—that would include ‘economic sanctions’, ‘deterrence’ and ‘commitment to exposing regime’s brutality’ (Pompeo 2018). Thus, Washington sought to pressurize Iran to make ‘tangible and sustained shifts in its policies’. The United States, Pompeo urged, wanted its ‘allies and partners aboard’. Despite American pressure, the EU worked hard to preserve the JCPOA, encouraged Iran to comply with its obligations and separate the Iranian nuclear issue from other elements of its policies. Brussels continued to work in the Joint Commission of JCPOA together with China and Russia. West European countries were reluctant to join the American ‘pressure campaign’. They sent low-level delegations (except

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the UK which was represented by Foreign Minister Jeremy Hunt) to the US-led ‘Ministerial to Promote a Future of Peace and Security in the Middle East’ Conference’ co-organized with the Polish Government in Warsaw on 13–14 February 2019 which was perceived as an anti-Iranian event. As US-Iran tensions escalated in May and June 2019 to the brink of an open conflict, the European Union urged restraint and dialogue. Despite the normalization of relations, there is still no EU Delegation in Tehran. The Union is usually represented by the EU Member State holding the Presidency of the Council of the EU.

India and Iran Unlike the European Union, India shares ancient and rather cordial relations with Iran, which has traditionally been one of the main suppliers of energy resources to India. Located in its extended neighbourhood, Iran plays also important role in many Indian strategic calculations. It is seen as a ‘gateway to Central Asia and Afghanistan’, a partner in Afghanistan and in the fight against international terrorism. As a neighbour of Pakistan, it is also a crucial partner in India’s perennial strategic competition with Pakistan and China. Both India and Iran enjoy centuries-old civilizational, cultural, economic and people-to-people links. For instance, the Persian language (Farsi) used to be the official language of the Mughal Empire in India until the nineteenth century. The Shia minority in India is sometimes considered as the second largest community in the world behind Iran. Most believers of Zoroastrianism—an ancient Iranian religion—live in Indian cities such as Mumbai. Iran considers India to be one of the most friendly countries and a possible strategic partner. India established diplomatic relations with Iran in 1950, but they did not progress well under the Shah Reza Pahlavi reign largely because of his close alliance with the United States during the Cold War (see Hussain 2012; Ayoob 1977). It was only after 1979 when Iran joined the Non-Aligned Movement and distanced itself from Pakistan that relations improved. After the Iranian Revolution, Prime Minister P.V. Narasimha Rao visited Iran in 1993 and President Rafsanjani returned the visit two years later. Relations gained momentum since the turn of the millennium. During the visit of Prime Minister Atal Bihari Vajpayee to Iran in 2001 a ‘Tehran Declaration’ was signed to open a new chapter in closer

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cooperation (India, Ministry of External Affairs 2001). In 2003 President Muhammad Khatami was the chief guest of the Republic Day parade and signed the ‘New Delhi Declaration’ that drew a ‘vision on strategic partnership’ (India, Ministry of External Affairs 2003). As India grew closer to the United States since 2004 and with mounting American pressure on Iran, India-Iran relations entered a turbulent period. Subsequently, India generally aligned its policy towards Iran with UN sanctions, which restricted cooperation and left most of New Delhi Declarations unfulfilled. The Iran nuclear deal (2015) gradually led to improved relations. A month after Federica Mogherini’s visit, Prime Minister Narendra Modi visited Teheran from 22 to 23 May 2016. The visit resulted in the signature of 12 MoUs, including one on the development of Chabahar port and marked the beginning of a new beginning in bilateral ties (Rizvi and Behuria 2016). Thus, the relations of India and the European Union with Iran mainly revolved around two issues—the nuclear file and energy resources.

The Nuclear Issue The nuclear programme was the single most important element in Europe’s relations with Iran for nearly two decades. It overshadowed other dimensions of cooperation but also allowed for constant diplomatic engagement. Europe took the initiative and sought a political solution to Iranian nuclear issue in 2003, which eventually led to an international agreement twelve years later. France and the UK—two European countries permanent members of the United Nations Security Council along with Germany, the biggest European economy, took the initiative in 2003 known as ‘E3+’ initiative. Next year, they were joined by the European Union, which has since led a pan-European approach. In 2006, the group was enlarged to include China, Russia and the United States—the three remaining permanent members of the UN Security Council. Though the process had been also known as ‘P5+1’ initiative, it functioned in Europe under acronym ‘E3/EU+3’ in recognition of the key role played by the Union. European actors have closely coordinated their activities on Iran with the United States and formed a united front at the UN. This cooperation with the United States is regarded as one of the crucial factors that led to JCPOA (Adebhar 2017). Between 2006 and 2012, European partners supported eight resolutions in the UN Security Council on the Iran

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nuclear programme that strengthened the sanctions regime. In January 2012, Brussels added its most stringent sanctions on Iran relating to trade, financial services, the energy sector and technologies, and banned the provision of insurance and reinsurance by insurers in Member States to Iran and Iranian-owned companies. This resulted in the imposition of an oil embargo and freezing the assets of Iran’s central bank. Moreover, all Iranian banks which were identified to be in breach of EU sanctions were disconnected from the SWIFT, the world’s hub of electronic financial transactions. The 2015 Iran nuclear deal was regarded as a personal achievement of Federica Mogherini, High Representative for Foreign Security and Defence Policy and the most important success of the EU as foreign policy actor (Adebhar 2017). This has been highlighted in numerous speeches and remarks by EU officials but also included into EU Global Strategy of 2016.1 It is therefore understandable the EU was the most fervent defender of the JCPOA. In response to US decision to withdraw from it, Federica Mogherini said that ‘the nuclear deal is not a bilateral agreement and it is not in the hands of any single country to terminate it unilaterally’ (Mogherini 2018, May 8). The nuclear deal with Iran, she added, was ‘crucial for the security of the region, of Europe and of the entire world’ and reassured Iranian side that ‘as long as Iran continues to implement its nuclear related commitments, as it is doing so far, the European Union will remain committed to the continued full and effective implementation of the nuclear deal’ (Mogherini 2018, May 8). On 8 May 2018, the EU and three European signatories of JCPOA held a EU/E3 consultations with Iranian delegation in Brussels. During the following ministerial meetings of the EU/E3 and Iran, the EU promised to continue normal cooperation with Iran across sectors (Mogherini 2018, May 15). Soon the European Commission presented a number of measures to be taken to preserve the nuclear deal (European Commission 2018, 18 May). When US sanctions were re-imposed on 7 August 2018, Brussels expressed ‘deep regret’ and stated that its ‘updated Blocking Statute

1 The Iranian nuclear deal is cited as an example of EU success in joint efforts to defend a multilateral rules-based order (European External Action Service 2016: 15), the successful use of coercive diplomacy towards non-proliferation regime (ibid: 42) and a contribution towards peaceful Middle East (ibid.: 35).

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enters into force on 7 August to protect EU companies doing legitimate business with Iran from the impact of US extra-territorial sanctions’ (European External Action Service 2018a, 6 August). In November, the EU/E3 stated that they were working towards establishing a Special Purpose Vehicle that would ‘allow for European exporters and importers to pursue legitimate trade’ with Iran (European External Action Service 2018b, 2 November). The European Union and Iran held the fourth meeting of the High-Level Political Dialogue on 26 November 2018 in Brussels. Two days later, Mogherini met with Foreign Minister Zarif on the margins of the Geneva Conference on Afghanistan. The two met again in February 2019 on the margins of the Munich Security Conference. In a separate Conclusion of European Union Council, the EU confirmed ‘its resolute commitment to and continued support for the Joint Comprehensive Plan of Action (JCPOA)’ but expressed concerns on other Iran’ activities: ‘provision of military, financial and political support to non-state actors in countries such as Syria and Lebanon’, ‘military involvement and continuous presence of Iranian forces in Syria’ and ‘Iran’s ballistic missile activity’ (European Council 2019). Apart from these mechanisms, the European Union and four EU Member States (France, Germany, Italy and the UK) (EU/E4) started a new format of dialogue with Iran on regional issues, including the situation in Yemen and Syria, on the sidelines of the Munich Security Conference in 18 February 2018. The subsequent rounds of EU/E4 meetings with Iran at the level of political directors took place in Rome (3 May 2018), and in Brussels (on 12 September 2018, 10 December 2018 and on 18 March 2019). By the end of June 2019, the EU’s special mechanism to overcome US sanctions—the EU-Iran Instrument in Support of Trade Exchanges (INSTEX) became operational. Initially, it was open to all EU Member States but subsequently it was also to be made available to economic operators from third countries. When Iran threatened to violate the JCPOA regulations in May 2019 in response to US sanctions, the Europeans powers expressed ‘great concern’ at Iran’s move and ‘rejected any ultimatums’ (BBC World News 2019, 9 May). However, after Tehran confirmed on 2 July 2019 that it had for the first time violated the terms of the nuclear deal, European leaders resisted calls to re-impose sanctions on Iran (The Guardian 2019, 1 July). The Europeans, Foreign Minister Zarif remarked, had failed ‘to fulfil their promises of protecting Iran’s interests under the deal’ (The New York Times 2019, 1 July). The EU/E3 warned that ‘our commitment to

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the nuclear deal depends on full compliance by Iran’ and urged Iran ‘to reverse this step and to refrain from further measures that undermine the nuclear deal’ (European External Action Service 2019, 2 July). In the following months, the European Union tried to salvage the JCPOA and continued to engage Iran amidst rising US-Iran tensions and complicated international context of COVID-19 pandemic. When the United States and Iran came to the brink of war in early 2020 after American killing of Iranian General Qassem Soleimani and Iranian retaliatory strikes on US bases in Iraq, Brussels urged restraint and engaged in diplomatic activities to de-escalate the situation. New High Representative and Vice-President (HR/VP) of EU Commission Josep Borrell called the Iranian Foreign Minister Javad Zarif on 5 January 2020. EU Council President Charles Michel telephonically warned Iranian President Hassan Rouhani on 9 January of ‘irreversible acts’ (EU Observer 2020, 9 January). The extraordinary Foreign Affairs Council held on 10 January 2020 gave a strong mandate to the HR/VP ‘to carry out diplomatic efforts with all parties, including Iran, to contribute to de-escalation in the region, to support political dialogue and to promote a political regional solution’ (European External Action Service 2020, 10 January). The EU condemned ‘every attack on Coalition forces’ in Iraq and also reiterated its commitment to preserving the JCPOA. ‘Without the JCPOA. Borell claimed, ‘Iran would be a nuclear power today. Thanks to this deal, Iran is not a nuclear power’. He urged Iran to go back to full compliance with the nuclear deal. On 16 January 2020, Borell met Zarif in person in New Delhi on the sidelines of the Raisina Dialogue conference and on 3–4 February 2020, he paid his first official visit to Teheran expressing ‘EU’s willingness to deepen its bilateral cooperation with Iran on issues of common interest’ (European External Action Service 2020, 4 February). While expressing expectation of Iran returning to ‘full compliance with its nuclear commitments’, he recognized also that Iran needed ‘to be able to benefit economically from sanctions lifting’. A planned EU-Iran High-Level Dialogue, which had to be held in March 2020 in Tehran, did not take place due to the COVID-19 pandemic. As Iran was one of the countries hardest hit by the coronavirus in the early stage of the pandemic, the EU was ready to assist it more on humanitarian grounds. Finally, on 31 March Germany sent medical goods to Iran using for the first time the INSTEX EU-Iran trading mechanism to bypass American sanctions. By May 2020, Brussels remained

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engaged in limited and tense cooperation with Iran on JCPOA, regional issues and COVID-19. In late 2019, six more European countries (apart from Germany, France, the UK and Italy)—Finland, Belgium, Denmark, Netherlands, Norway, and Sweden—joined the INSTEX (EURACTIV 2020, 1 April). Iran has also not been a beneficiary of EU development cooperation programmes because of tense relations. However, small assistance was provided directly to the Iranian society through a portfolio of projects implemented by local or European civil society organizations and funded under the EU Development Cooperation Instrument’s envelope for non-state actors and, to a lesser extent, the corresponding European Instrument for Democracy and Human Rights (EIDHR). Following the Iran nuclear deal, the EU decided in 2018 to allocate e50 million in support of bilateral cooperation with Iran in the period leading up to 2020 to address key economic and social challenges. First projects worth e18 million were launched in 2018 (European Commission 2018, 23 August). Amidst the Coronavirus crisis, the EU agreed in March 2020 to send a e20 million aid package to Iran to help deal with the pandemic and supported Iran’s request for financial help from the International Monetary Fund (Reuters 2020, 23 March). Moreover, the EU is one of the biggest donors supporting Afghan refugees living in Iran. Since 1997, the EU has funded humanitarian projects for them of more than e52 million. India’s position on the Iran nuclear issue has been more nuanced and ambivalent than that of the EU. New Delhi apparently had similar views to China and Russia than with the West (Singh 2010). Initially, New Delhi could have had even more understanding and support for Iran’s strategic ambitions and concerns because of its staunch criticism of the Non-Proliferation Treaty (NPT) as ‘discriminative’ and even as a form ‘nuclear apartheid’ (Singh 1998: 41). Similar statements were often made by the Iranians. As a country that had conducted nuclear tests in 1998 and had declared itself a nuclear weapon state outside the NPT regime, New Delhi was perhaps not in a particularly strong position to criticize Iran. Nevertheless, India also urged Iran to comply with its international obligations. After signing the New Delhi Declaration with Iran on a strategic partnership in 2003 wherein both sides ‘expressed their concern about restrictions imposed on the export of [nuclear] materials, technology and equipment to developing countries’ (India, Ministry of External Affairs 2003), India subsequently became critical of Iran’s stance.

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Thus, in September 2005, it voted against Iran in the International Atomic Energy Agency (IAEA) Board of Governors. In February 2006, it supported the IAEA’s recommendation that the Iranian case be referred to the United Nations Security Council. Again, New Delhi voted for the third time in favour of US-drafted resolution on Iran in IAEA in 2009. As a non-Permanent Member of the UN Security Council 2011–2012, India supported two resolutions on Iran in June 2011 and June 2012 to renew the mandate of the Iran Sanctions Committee. New Delhi has reluctantly adjusted to international sanctions and reduced its oil imports (despite high dependence on Iranian oil which in 2010 made 17% of all imported oil) and limited cooperation in other areas. In 2011, India agreed to ban the export of all items, materials, equipment, goods and technology that could contribute to Iran’s nuclear programme. The primary reason for India’s criticism of Iran’s nuclear policies is its key interest to prevent proliferation of nuclear weapons. New Delhi has no desire to have another nuclear state in its own backyard. Indian officials state that as a signatory to the NPT, Iran must comply with its nonproliferation commitments. New Delhi had earlier expressed concerns that Iranian technology had been clandestinely provided from Pakistan by A. Q. Khan’s network. Moreover, India’s ambivalent position of having acquired nuclear weapons outside the NPT left it in some kind of a limbo between two recognized categories of states, and made it tried to legalize and upgrade from a three-decades-long ‘pariah nuclear state’ status (Pant and Biswas 2018: 2240). India also had to demonstrate that it was a ‘responsible nuclear power’ that deserved to become a member of the international non-proliferation regime. After going nuclear, a scholar argues, India has worked ‘to maintain the global nuclear order’ (Nayan 2018: 232). The most decisive factor leading to a change in India’s attitude towards Iran seems to have been American pressure. Difficulties with Iran’s nuclear policies had begun in the early days of Indo-US rapprochement. A key element of their strategic partnership was civilian nuclear cooperation. During the negotiations of the Indo-US Civil Nuclear Agreement since 2005 until its signature during the visit of President George W. Bush to New Delhi in 2006, Iran figured considerably. The Hyde Act (2006), which granted Congressional approval for nuclear cooperation with non-NPT members, obliged the US President (under Section 3(b4)) to ‘secure India’s full and active participation in the United States efforts to dissuade, isolate and if necessary, sanction and contain Iran for its

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efforts to acquire weapons of mass destruction’ (quoted in Baidya 2017: 151). According to some observers, Iran-India relations suffered due to US pressure and India could not forge an independent policy towards Iran (Baidya 2017: 144). With the ratification of the India-US civil nuclear cooperation agreement in 2008 and after having surmounted several international obstacles, India was recognized as de facto nuclear state. Some scholars regarded Washington’s different treatment of Iran and India or Pakistan as proof of American double standards and inconsistency (Dasgupta 2018: 12). For India, however, relations with Iran were a minor price to be paid for its integration into the international non-proliferation regime. New Delhi’s soft balancing of the United States and Iran, an Iranian scholar argues, was the main reason why the two countries failed to establish a strategic partnership (Soltaninejad 2017). A new factor has recently emerged in Indian strategic calculations regarding Iran, viz. a growing cooperation with Israel and Arab states. Vital military, intelligence and anti-terrorism cooperation with Israel and enhanced economic and energy links with Arab countries outweigh the traditional importance of Iran in Indian foreign policy. Today, India has simply much more interests in the Gulf region and Israel than in Iran (Raja Mohan 2018, 2 October). The United States cast a long shadow on many dimensions of IndiaIran relations. American pressure made it impossible for New Delhi to make investments in gas fields, shipments of LNG or proceed meaningfully with the Iran-Pakistan-India gas pipeline. Discussions on the pipeline had begun in the 1990s, but were finally given up by 2009. Official reasons for the Indian withdrawal from the pipeline project included unsatisfactory gas prices, the security situation in Pakistani province of Baluchistan and general tensions in Indo-Pakistani relations. Staunch American opposition to cooperation with Iran seems to have been a key deterrent because the alternative scheme of a direct Iran-India pipeline through the Indian Ocean did not materialize either. In the wake of international sanctions on Iran, India put on hold most of key projects and substantially reduced its oil imports from Iran. However, New Delhi was not in favour of harsher measures, especially those targeting its energy sector. New Delhi has expressed support for Iran’s claims for peaceful uses of nuclear energy and argued that the impasse should be overcome through dialogue and diplomacy. Its more

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amicable policy on Iran is seen as a result of attachment to ‘strategic autonomy’ in foreign relations (Samuel and Rajiv 2011). Hence, though not a participant, India strongly supported EU-led international diplomatic efforts and welcomed the signing of the JCPOA. Like European countries, it was also disappointed by the American decision to withdraw from the JCPOA in May 2018. India did manage to twice secure waivers from secondary sanctions on imports of Iranian oil. However, when the exceptions ended in May 2019, India stated that it would comply with new sanctions and altogether stop oil imports from Iran (Business Standard 2019). This has obviously had significant economic and political costs. New Delhi is therefore keen to find a solution to the current crisis (possibly in cooperation with the EU) and resume normal relations with Iran.

Iran: Energy and Economic Partner Iran has traditionally been an important source of energy for both Europe and India. Import of oil made usually the bulk of bilateral trade and allowed Iran to buy European or Indian goods enhancing economic cooperation. Not surprisingly the imposition of a strict sanctions regime post-2011 hit Iran’s trade in energy and goods with both EU and India hard. In the following years, European countries reduced oil imports from Iran almost to zero. Consequently, cooperation in other areas has come to a halt and bilateral trade plummeted considerably (see Graph 9.1). EU–Iran trade recovered only after lifting the international and EU sanctions in 2016. Total exchange of goods rose from e7.724 billion in 2015 to e13.748 billion in 2016 and e20.954 billion in 2017 (European Commission, DG Trade 2019, 3 June). The difference was strongest in EU imports. It grew four folds in 2016 (from e1.25 billion to e5.5 billion) and doubled in 2017 (to e10.1 billion). Value of shipments of oil grew from almost zero in 2015 (e28 million) to e4.262 billion in 2016 and e8.988 billion in 2017. Despite the sharp increase, the trade has not reached a pre-sanctions level. Energy-related goods make most of EU’s imports (mineral fuels account for e8.9 billion and 88.7% of EU imports from Iran), followed by manufactured goods (e0.6 billion, 6.4%), and food (e0.3 billion, 3.3%) (European Commission, DG Trade 2019, 3 June). The EU exported over e10.8 billion worth of goods to Iran in 2017—mostly

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Graph 9.1 European Union Trade with Iran, 2008–2018 (Source European Union, Trade in Goods with Iran Directorate-General for Trade, European Commission [https://webgate.ec.europa.eu/isdb_results/factsheets/ country/details_iran_en.pdf, accessed on 3 June 2019])

machinery and transport equipment (e5.5 billion, 50.9%), chemicals (e1.9 billion, 18.1%), and manufactured goods (e0.9 billion, 8.9%). The withdrawal of the United States from the JCPOA on 8 May 2018, and the re-imposition of American secondary sanctions on 7 August and 5 November 2018 have adversely affected EU-Iran economic cooperation. In 2018, bilateral trade had decreased by over e2 billion to e18.367 billion, which was a reflection more of trading hurdles rather than declining confidence on all sides. European companies have lowered imports of Iranian oil from e8.988 billion to e8.248 billion. Though Italy and Greece were included among eight countries that were twice given US waivers, this was not extended beyond May 2019. European exports to Iran declined from e10.829 billion in 2017 to e8.914 billion in 2018. Though China superseded the EU to become Iran’s leading trade partner in 2012, it still remains like India among its major trading partners. According to Eurostat, EU28 total trade with Iran in 2018 stood at e17.3 billion, making the Union the second largest trade partner for Iran (accounting for a 17.7% share). China’s trade with Iran amounted

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to e25.9 billion, with a share of 26.4% and followed by India at third place (e13.8 billion with a share of 14.2% in Iran’s total trade). The European Union was the second biggest source of imports (e8.3 billion, 22.1%). India was the second biggest destination for Iranian exports (e11.8 billion, 19.8%). In 2019, Iran was the EU’s 36th partner in export and 37th in imports (European Commission, DG Trade 2019, 3 June). For India, Iran was its 15th biggest trading partner in 2018–2019 with a total trade volume at US$17.036 billion (a 2% share in total trade) (India, Ministry of Commerce 2019). India imported goods (mostly crude oil) worth US$13.525 billion and exported goods worth US$3.511 billion. Major Indian exports to Iran include rice, tea, iron and steel, organic chemicals, metals, electrical machinery, drugs/pharmaceuticals, etc. (India, Ministry of External Affairs 2019) (Graph 9.2). Import of oil plays a traditionally important role in Indo-Iranian relations. India is the world’s third largest importer of crude oil (US$74 billion in 2017), only behind China (US$144 billion) and the United States (US$129 billion). Oil stands for 18% of total Indian imports and accounts for a majority of its trade deficit (which stood at US$125 billion in 2017) and a key burden on balance of payments (Observatory of

Graph 9.2 India’s Trade with Iran, 2008–2018 (Source India, Ministry of Commerce and Industry, Export Import Data Bank)

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Economic Complexity). Any difficulties in meeting its demand or an increase in global oil prices has a considerable negative impact on Indian economy. Iran has traditionally been an important source of crude oil for India. Until the imposition of severe Western sanctions, Iran, was India’s second biggest supplier after Saudi Arabia till 2010–2011. In subsequent years, India reduced its imports to 11 million tonnes in 2013–2014 and Iran has been downgraded to its seventh biggest source of oil imports until 2015– 2016 (12.7 million tonnes). Only after sanctions were lifted that Indian oil imports skyrocketed to 27.2 million tonnes in 2016–2017, catapulting Iran again to the position of third biggest supplier. President Donald Trump’s strident anti-Iran rhetoric has had a sobering impact on Indo-Iranian oil trade even before official sanctions were imposed in 2018. Some Indian companies, especially private ones with big interests in the United States, had already reduced imports from Iran and started looking for other markets. Hence Indian oil imports from Iran moderately declined to 22.59 million tonnes in 2017–2018, but increased marginally to 23.9 million tonnes of crude in 2018–2019. The Persian Gulf country maintained its position as the third largest crude oil supplier to India in early 2019. With India’s rising demand for energy being increasingly met in recent years by other partners, Iran’s overall share in India’s total oil imports declined from 17% in 2010 to 11% in 2018. Yet, New Delhi was by then the top destination for Iranian oil exports. However, as the second US waiver ended in May 2019 without further exemptions, India announced it had stopped purchasing Iranian crude oil and complied with US sanctions (Business Standard 2019, 24 May). As some confusion on India-Iran energy ties continued in the following months, it was clear that New Delhi redirected its energy imports elsewhere, including from the US. It also suggests that Indian efforts to establish its own alternative payments mechanism to continue doing business with Iran (possibly through Iran’s Bank Pasargad) (India Today 2019, 9 January) has failed. Thus far, New Delhi has not expressed interest in joining the European mechanism for trade with Iran, INSTEX, which could eventually offer other countries a way to overcome US sanctions.

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Political and Strategic Interests in Iran The European Union and India have similar interests regarding Iran, but there have not been much EU-India consultation and cooperation on that matter so far. The most promising issues include the stabilization of Afghanistan, regional connectivity and cooperation and the fight against terrorism. A stable, prosperous and terrorism-free Afghanistan is a shared interest of the EU, India and Iran. Shia Iran, which differs ideologically with Sunni Taliban and which suffered an attack on its Consulate in Mazar-iSharif by the Islamic Emirate of Afghanistan in 1998, became a critical enemy of Taliban in the 1990s and an ally of India. It has invited India to a conference on Afghanistan in Tehran in 1996, at the expense of Pakistan, and cooperated with India in supporting the Northern Alliance. Both Tehran and New Delhi welcomed the American invasion of Afghanistan in late 2001 and the overthrow of the Taliban regime. Since then, however, Indian and Iranian views of America’s role in the region have diverged. India has supported the large military presence of Western forces in Afghanistan. Iran, which has been labelled by the Bush Administration as part of the ‘axis of evil’ in 2002 and which saw critically the US invasion of neighbouring Iraq in 2003, became anxious of American involvement in the region. As a result, it developed contacts with its former arch-rival, the Taliban, in recent years. Iran has occasionally been accused of supporting anti-Afghan government extremists. Yet, Iran today has working relations both with the government in Kabul and with some Taliban, something that India has long viewed as highly objectionable. As the US engaged the Taliban in direct talks on the future of Afghanistan in 2018, India’s position seems to be in need of readjustment. During the visit of Foreign Minister Javad Zarif in New Delhi in January 2019, therefore, Tehran offered to help India establish contacts with the Taliban (India Today 2019, 8 January). India and Iran have also cooperated in providing development assistance and fostering regional cooperation with Afghanistan. One of the major Indian development projects in Afghanistan, announced in 2003 and completed in 2009 was a 218 km-long Delaram-Zaranj road that connects the Afghan ring road with the Iranian border, and further south to Indian Ocean, easing Afghanistan’ dependence on Pakistan for its access to sea. Both also cooperated in the Heart of Asia conference

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(Istanbul Process) that seeks to make the best use of Afghanistan strategic location at the crossroads of different regions of Asia. In 2007, Iran became an observer in South Asia Association for Regional Cooperation (SAARC), which also included Afghanistan since 2008. The European Union is also an observer in SAARC since 2006 and supports regional cooperation in South Asia. Though SAARC remains inactive due to IndoPakistani tensions, the fact that both Iran and the EU are observers in the organization may give them a platform to discuss regional issues. The European Union which was heavily involved economically and militarily in the stabilization of Afghanistan and spent billions of Euros on its reconstruction. Many European Union members sent their troops to the country as part of the NATO mission since 2005, and contributes to EU civilian mission there. From 2002 to 2018, the European Union has provided around e4 billion in development aid to Afghanistan, which makes Afghanistan the largest beneficiary of EU development assistance in the world. In the current funding cycle (2014–2020) it has allocated e1.4 billion in aid to Afghanistan, focusing on three priority sectors: peace, stability and democracy; sustainable growth and jobs; and basic social services (European Commission 2020). Yet, the EU has so far not developed joint projects in Afghanistan, with neither India nor Iran. Different aid modalities, technical difficulties, political tensions and lack of mutual trust and information may be major reasons for this. This suggests that there is large scope for improvement in cooperation and consultation between the EU, India and Iran on the future of Afghanistan. As the strategic neighbour with access to the country and links with the Taliban, Iran is an important partner for both India and Europe to foster peace, find political solution, support development and integrate Afghanistan with world’s economy. India already engages Iran and Afghanistan in dialogue on the future of the region. The first such tripartite consultation at Deputy Foreign Minister level took place in Kabul, in September 2018, and talks focused on consolidating economic cooperation, enhancing cooperation on counter-terrorism, counter-narcotics, and continuing support to the peace and reconciliation process (Ministry of External Affairs 2019). More EU-India cooperation with Iran on the future of Afghanistan would be even more important today, as Afghanistan’s transition enters a crucial phase and American forces are likely to withdraw from the country after signing historical deal with the Taliban on 29 February 2020.

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Regional connectivity is another important area where Indian and Iranian interests converge. Iran can offer India an access not only to Afghanistan, but also to Central Asia and to Europe, through the International North–South Transport Corridor (INSTC). The Iranian port of Chabahar plays a crucial rule in this regard. Little progress was made in the development of Chabhar port until 2015, more than a decade after the two sides undertook to develop it in the Delhi Declaration in 2003. After coming to power in 2014, in October Prime Minister Modi made a final decision to support port’s development, ending the long period of Indian indecisiveness (Sandliya 2014). It was during the visit of the Prime Minister to Tehran in 2016 when the contract was signed and India committed tangible resources ($85 million of investment for equipping the port and US$150 million of line of credit) for the development of the first phase of Shahid Beheshti port at Chabahar (Ministry of External Affairs 2019). Three transport ministers of India, Iran and Afghanistan signed a Trilateral Transit Agreement on the occasion (Chabahar Agreement). The first phase of the Chabahar port was inaugurated in December 2017 by President Hassan Rouhani. And in December 2018, India took over the operations of that part of the port (Reuters 2019, 8 January). Even when the United States imposed the sanctions on Iran in 2018, India secured that its investment in Chabahar was exempted so its strategic project could continue. Despite stopping energy trade with Iran, India works in Chabahar with additional Rs1 billion ($13.9 million) allocated for the development of port in early 2020 (Ship Technology 2020). Indian efforts in developing Chabahar port are similar to renewed EU efforts to improve connectivity with and in Asia. The 2016 EU-Iran Joint Statement stipulated mutual ‘commitment to a safe and sustainable development of all modes of transportation in order to support the resumption of trade, investment and citizens’ links’ (European Commission 2016, 16 April). The 2018 EU Strategy on Connecting Europe and Asia seeks to develop quality infrastructure in Asia (European Commission 2018, 19 September). Situated between India and Europe, Iran is ideally located to jointly develop better transport infrastructure and connectivity. Indian investments in Chabahar port and the INSCT could serve as an area to explore prospects for trilateral cooperation and enhancing connectivity between India and Europe. Another area of joint Indo-Iranian cooperation is dealing with terror emanating from Afghanistan and Pakistan. The February 2019 strike on

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Iranian forces from Pakistan occurred a day before the deadly attack on Indian forces in Pulwama in Jammu and Kashmir by Pakistani-based organization Jaish-e-Muhammad, was a stark reminder of a shared threat (The New York Times 2019, 13 February). Dealing with terrorism has been a constant theme in Iran-Indian parleys. For the EU, however, the problem is more complicated, since Iran is seen as both a part of the problem and a part of the solution. Though Europe may dislike Iranian support for the Hezbollah and other organizations in the Middle East, it does not share American characterization of Iran as the main promoter of terrorism. Both the EU and India would appreciate a more proactive Iranian role in suppressing the Islamic State in Iraq and Syria (ISIS) through its regional allies and proxies. Cooperation with Iran may also be conducive to further weakening international jihad and extremism. Naturally, there are also some areas in which the EU and Indian perspectives on Iran diverge. Brussels has been extremely critical of Iran’s role in the Syrian and Yemen civil wars as well as its continued support for the Bashar al-Asad regime and the Yemeni Houthi rebels. New Delhi has however maintained a low profile and urged political solutions to both conflicts. It has not supported Western pressure on President Asad to step down and recently announced its readiness to play a larger role in reconstruction of the war-torn country. If European countries also become more inclined to accept the status quo and participate in rebuilding of Syria, this may open another area for EU-India cooperation. Another area of disagreement between the EU and India on Iran is their different approaches towards human rights and democracy. European countries and institutions have regularly criticized Tehran for its violations of human rights, freedom of the press, the death penalty, etc. A recent resolution of the European Parliament on Iran (14 March 2019) urged the Iranian authorities ‘to immediately and unconditionally release all human rights defenders, prisoners of conscience and journalists’ (European Parliament 2019). India, on the other hand, pursues a policy of non-interference in internal affairs of other countries and refrains from criticizing Iran for its domestic policies.

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Conclusion The Iranian nuclear programme has dominated European and Indian relations with Iran for almost two decades. International sanctions hindered both countries from realizing the full potential of their relationships. With the signature of the JCPOA in July 2015, impediments seemed to apparently vanish and open a new chapter in their relations with Iran. The optimism was however short-lived since the Trump’s Administration’s withdrawal from the agreement has created fresh difficulties. Yet, this time both the EU and India are on the same page concerning preservation of JCPOA, US sanctions and the need for political solution to regional conflicts. This theoretically opens the space for joint EU-India actions. In the past, the Europe and India did not either consult or coordinate their policies vis-à-vis Iran, except on the nuclear issue. As this chapter illustrates, there is much more that both actors share when it comes to Iran. In fact, recent regional and global shifts make this cooperation possible and more necessary. Both continue support for nuclear deal and criticize US for withdrawal from the agreement. Both India and Europe are gravely concerned about heightened tensions and risk of a US-Iran conflict destabilizing the whole region. Both of them would welcome if Iran renounced its nuclear ambitions. At the same time, they would prefer Tehran to be integrated with the world economy. With several million Indian workers in the Persian Gulf and the region providing two-thirds of its energy resources, New Delhi naturally has high stakes in the stability and peace of the region (Mehta 2019, 1 July). Europe, which still feels the repercussions of fallout of disastrous US intervention in Iraq in 2003 and of the Syria civil war since 2011, is afraid of destabilization of the last stable country in the wider Middle East. Europe—both the European Union and three European countries (France, Germany and the UK—as co-authors of the JCPOA, bear a special responsibility for salvaging the agreement. Though not a part of the JCPOA, India is a rising regional and global power. It can perhaps play a larger role in resolving the crisis. It is one of very few countries that enjoys amicable and close relations with both Iran and the United States as well as with Israel and Saudi Arabia. It is well placed to offer good services and mitigate tensions between main adversaries while contributing to stability in the Middle East.If the EU and India can jointly avert the negative scenarios for the region, bypass the sanctions and foster Iran’s integration with the world economy and the comity of nations as a

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‘responsible state’, that would open the way for more opportunities. To that end, one of first steps of closer EU-India cooperation on Iran could be invitation of India into EU INSTEX mechanism to continue trade with Iran. There is potential for both Europe and India to collaborate with Iran regarding connectivity, the stabilization of Afghanistan or the fight against international terrorism. Brussels can play closer attention to the Indian initiative of the International North–South Transport Corridor and possibly offer some support for development of quality infrastructure through Iran. Tehran can help India and the EU to establish links with the Taliban and help contribute that Afghanistan remains stable democracy after a substantially reduced American troop presence in the country. Cooperation of EU, India and Iran on development projects in Afghanistan would not only help to stabilize the country but can serve as a confidence building measure between Iran and the West. Finally, Iran plays an important role in the area of international terrorism (whether it fights terrorists or sponsors them is a matter of discussion depending of perspective of observers) underlines the need for greater dialogue with India and the EU. Iran, which used to be a point of divergence between Europe and India in the past, can now help to bring them closer and become an important element of their strategic partnership.

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CHAPTER 10

India, the European Union and Kashmir: Containing a Postmodern Policy Pramit Pal Chaudhuri

The differences between India and the European Union over Kashmir are a textbook example of how two governments can approach a foreign policy dispute from wholly different points of view. The original points of divergence were, one, India’s tactical view of dialogue with Pakistan and, two, human rights violations in Indian administered Kashmir. How the EU changed its policy towards India and Kashmir is also a micro-study of how pragmatic versus idealist foreign policy approaches contend with each other within Brussels. The differences on Kashmir between India and the EU reached their peak in the period between 2000 and 2004. During this time policy in Brussels was strongly under the influence of the European Council and its prioritization of human rights. Subsequently, the EU Commission graduated Brussels’ position to a more realist attitude, a policy shift helped by the easing of political violence within Indian Kashmir. Kashmir continued

P. Pal Chaudhuri (B) Head, Strategic Affairs at Ananta Aspen Centre, New Delhi, India Foreign Editor, Hindustan Times, New Delhi, India © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 R. K. Jain (ed.), India, Europe and Asia, https://doi.org/10.1007/978-981-33-4608-6_10

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to be raised, largely symbolically, for a few more years at the European Parliament at the behest of human rights activists. By 2007, differences over Kashmir had largely disappeared from the formal bilateral relationship. This came to be institutionalized after the creation of the EU’s dedicated diplomatic corps, the European External Action Service, in 2010. While Kashmir occasionally surfaces in tangential comments by EU officials, the two sides effectively worked out a formula that allowed them to provide symbolic victories to activists on both sides. The Indo-EU relationship has since become grounded in other more concrete economic and security interests. This has so far survived despite an uptick in political unrest in Kashmir, a deterioration in Indo-Pakistan relations since 2015 and New Delhi ending the special constitutional status of Indian Kashmir in 2019. The European Commission’s most recent big picture policy statement on India, its 2018 ‘Elements of an EU Strategy on India’, notably lacks even an indirect mention of the issue (European External Action Service 2018).

EU Calls for Dialogue Between 1993 and 2009, the European Union began a period of foreign policy consolidation, largely driven by the trauma of the Balkan wars that followed the break-up of Yugoslavia. One of the minor elements of this foreign policy was a move to institutionalize relations with emerging powers like India and China. In the period before 2001, EU policy was also marked by a high degree of activism regarding human rights and liberal internationalist issues (Allen 2012). India and the EU held their first bilateral summit and issued their first joint statement in 2000. The first statement mentioned terrorism. The second joint statement included a line on Pakistan and terrorism. In subsequent summits, Brussels pushed for statements that included some words supporting a dialogue between India and Pakistan over the Kashmir dispute, moves strongly opposed by India. For the EU, unconditional dialogue was a minimum prerequisite for trying to defuse if not resolve one of the world’s major international flashpoints. For New Delhi, unconditional dialogue would undermine two pillars of its diplomatic strategy regarding Kashmir. One was to keep the international spotlight on Pakistan’s sponsorship of terrorism. The other

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was to keep Kashmir a bilateral issue, a stance that maximized its negotiating strength and reflected its desire to maintain the territorial status quo (Ganguly 2016). Brussels attempts to link the dispute to human rights issues in Kashmir also met with opposition by New Delhi. As Bhaswati Mukherjee, a former Indian ambassador who handled Western Europe for many years, writes in her account of the India-EU relationship, ‘the need for separate consultations on human rights and whether the consultations should focus narrowly on civil and political rights as the EU desired or on all rights’ was a constant source of discord between New Delhi and Brussels (Mukherjee 2018: 84).

The Summit that Almost Failed Things came to a head at the third India-EU summit in Copenhagen in 2002. The Danish presidency, reflecting its newly-elected coalition government’s foreign policy agenda, felt it had to take a strong position criticizing human rights violations in Kashmir and, additionally, a whole series of ‘social evils’ in India including child labour and the caste system. Unfortunately for India, the summit took place when cross-border tensions with its neighbour, Pakistan, were also peaking. Anti-Muslim riots by Hindu mobs in the town of Godhra, Gujarat, had left India’s international image in a particularly poor light. The Danish government decided to ignore the European Commission recommendations that it soft pedal these issues and just focus on economic issues. Mukherjee describes it as ‘one of the most contentious summits ever held, which almost set back the potential of the emerging IndiaEU strategic partnership’. Denmark called for India to be ‘censured for human rights violations and should agree to a separate human rights dialogue with the focus on social discrimination, child labour and exploitation of the lowest levels in Indian society’. Danish and Indian officials took uncompromising positions during the negotiations at official and ministerial levels. The two sides could not agree on a joint communique and a weak joint statement was eventually agreed on. Indian officials say Denmark’s actions were unilateral, that it failed to consult even the

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other members of the Commission. Danish diplomats privately say this was not the case and all the major EU Member States were in the know.1 The subsequent press conference was in shambles. The then-president of the Council of the European Union, Anders Fogh Rasmussen, called on India to respect human rights, reform its caste system and labour laws. In an answer to a question as to why Kashmir was not mentioned in joint statement, said: ‘To be honest and frank, we did not agree on a text. But I would like to…urge all parties in this conflict to find a peaceful solution’. The Danish prime minister called on India and Pakistan to hold talks on their differences three times in the press conference. He said, ‘We urge India to engage in a direct dialogue with Pakistan and to establish confidence-building measures on security issues, including on nuclear arms and in relation to Kashmir. Tensions in Kashmir should be lowered. We see a need for a dialogue among the stakeholders in Kashmir’. While he criticized terrorist attacks in Kashmir, Rasmussen did not mention their ‘cross-border’ nature, further irritating Indian officials (Mukherjee 2018: 86–87; Baruah 2002). An angry Indian government, unused to diplomatic disagreements that had taken place behind closed doors being aired so publicly, cut short the conference and held a separate briefing where it noted that Brussels had declined to make reference to Pakistan’s support for cross-border terrorism in Kashmir (Baruah 2002). This was an issue of sensitivity to India as it had foiled a major terrorist attack by Pakistani-backed terrorists on its Parliament the year before, an attack that had led both sides to mobilize their armies for several months. In the view of the EU, holding talks was the starting point to any conflict resolution process. Therefore, they could not be separated from actual bilateral controversies like terrorism. Those would be part of the agenda for the talks but could not be a reason not to talk. For India, holding or not holding talks was one of the means by which it sought to constrain Pakistan’s use of terror (Wuelbers 2010). Mukherjee describes it as the ‘summit that nearly failed’ (Mukherjee 2018: 86). The Copenhagen summit also showed to India that the European Commission had a more pragmatic foreign policy vision that ran in parallel to the more idealistic one of the Council. After the contretemps at Copenhagen, the EU High Representative for Common Foreign and

1 Private conversations with a Danish Ambassador to India.

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Security Policy, Javier Solana, privately told the Indian delegation that Brussels was already sketching out a more hard-nosed foreign policy in which India would play an important role. He noted the challenges the EU faced from a rising China and even urged India to consider becoming a North Atlantic Treaty Organization (NATO) partner country (Mukherjee 2018: 90). Indian officials also believe Solana, the closest thing to a EU foreign minister between 1999 and 2009, being a Spaniard and conscious of his own country’s Catalan and Basque sub-nationalist trends, was wary of the precedent that could be set by Kashmiri separatism.2 Solana, whose worldview had already been tempered by his years in NATO, was probably motivated more by a realist understanding of the challenges that the liberal world would face in the coming years. During his long stint in charge of EU foreign policy, Solana stressed the importance of developing relations with regional powers like India, Europe’s interest in global stability and the need to accept military power as an instrument of statecraft (Barros-Garcia 2007). The EU-India Strategic Partnership Communication of June 2004 was the last significant bilateral document to make a mention of Kashmir. In the section on ‘Strengthening International Cooperation’, a segment that included parts on human rights and South Asia stability, is the line, ‘While Kashmir is primarily a bilateral issue with international implications, the EU can offer its own unique experience as an example of building peace and forging partnerships’ (European Commission 2004: paragraph 2.1.7). It also calls for promoting stability inside South Asia by encouraging dialogue between India and Pakistan. The phrase ‘primarily a bilateral issue’ was almost certainly the language of the Indian side and designed to dissipate any thought of any third-party role in the dispute. Fortunately, the then-Prime Minister Atal Behari Vajpayee had recommenced a peace process with Pakistan at this point so New Delhi could have no issues with a tangential reference to dialogue (see Winand et al. 2015). The ‘K-word’ all but disappeared from bilateral documents subsequently. The 2005 India-EU Strategic Partnership, negotiated under the shadow of Al Qaeda and Islamicist terrorist attacks globally, was notable for including a line that the partnership should be kept ‘immune from the

2 Conversation with a former Indian Ambassador to the EU.

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vicissitudes of either side’s relationship with a third party’. The line had been inserted at India’s insistence as part of a continuing drive to ‘dehyphenate’ India and Pakistan in the mind of European policy makers (Mukherjee 2018: 103).

India’s Kashmir Solution For India’s political leaders, the European insistence on bringing up human rights, however tangentially, was a red flag because of a belief Brussels was ignoring the context in which these human rights violations were occurring. By the 1990s, it was clear to almost every Indian political leader that New Delhi had erred terribly by rigging the Kashmir elections in 1987, imposing the G.M. Shah government on the state and compounding it all by discrediting the regional Kashmir party, the National Conference, by restoring it to power in coalition with the Congress Party. As an Indian parliamentarian told me in the early 1990s, ‘Kashmiri sub-nationalism needs to be held in check with a state party that is pro-union but antiDelhi. Now there is no such party in Kashmiri eyes and the militants have filled in the vacuum’.3 Restoring the democratic process in Kashmir and finding a Kashmiri political group that could retake the political space from the militants was something all Indian political leaders recognized, irrespective of ideology. But the return of normalcy required, as a prerequisite, at least a temporary recession in militant violence so that a legitimate election could be held. This, in turn, required that Pakistan cease to provide both safe haven and material assistance to the militants. Restoring democracy was impossible so long as jihadis ran rampant (see for example: Joshi 1999; Bose 2005). India differed the most with Brussels’ insistence on pursuing human rights in isolation. In New Delhi’s view, human rights issues could only be addressed by restoring a democratic political process that could only follow after the defeat of militancy and imposing costs on Pakistan. This Indian perception of European naivete regarding Kashmir was derived less from the EU’s official Common Foreign and Security Policy than from interactions with EU parliamentarians and occasionally EU officials.

3 Private conversation with a veteran Indian Member of Parliament from West Bengal.

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This divergence on the question of human rights probably best underlined the modern versus the postmodern worldviews of India and Europe. For Brussels, the legitimacy of the European project lay in upholding such positions. For New Delhi, the overriding principle was the preservation of the country’s territorial integrity—a principle that a postmodern Europe would see as a secondary concern. Positions different from the EU stance were taken by the UK and Germany at the bilateral level. And the Commission’s more realist point of view has already been mentioned. As a rule of thumb, say Indian officials, the greater the European nation’s economic stake in India, the more willing it was to buck the EU line on Kashmiri human rights. One of the few exceptions was arguably the Netherlands, which had substantial economic interests in India but was also a political bellwether for the human rights movement. Though the actual trigger was Dutch opposition to the Pokhran nuclear tests, Delhi irritation at past Dutch moralizing helped inspire the decision to reject overseas development aid from that country—though it was the eighth largest aid donor to India. India was to limit the aid it received from foreign donors to six nations after 1998 and the smaller European countries were the primary recipients of this restriction.

European Parliament and Human Rights India’s human rights record in Kashmir was a source of contention, even if largely symbolic, between India and the weakest of the EU foreign policy institutions, the European Parliament. The European Parliament had regularly passed resolutions critical of the human rights record of Indian security forces, calling for a dialogue between India and Pakistan, and urging the appointment of a EU rapporteur for South Asia and Kashmir. These had been largely ignored by New Delhi who saw them as the work of a small cluster of human rights activists, three or four parliamentarians of Pakistani origin, and a few British legislators who had to cater to Pakistani-origin voters.4 The British Conservative member of the European Parliament, James Elles, for example, established an All-Party Group on Kashmir in 2000 which regularly criticized India’s handling of Kashmir. An English barrister of Kashmiri origin set up a Kashmir Centre EU in Brussels in 2003 which

4 Private conversation with a former Indian Ambassador to the EU.

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became ‘the most active lobby group related to South Asia’ for a few years (Racine 2015: 22). The European Parliament constitutionally had only a consultative role in Brussels foreign policy and EU officials ignored the resolutions when they met with their Indian counterparts. By the mid-2000s, the Indian government felt more confident about the situation in Kashmir. The separatist insurgency that had peaked in the late 1990s had receded dramatically a decade later. Civilian casualties, the most contentious ones from a human rights angle, had fallen in Indian Kashmir from a peak of 1,424 in 1996 to 161 in 2007 (Jammu and Kashmir Government 2007). Incidents between security forces and insurgents had similarly experienced a steep fall. Pakistan’s ability to garner international support or interest in Kashmir had also faded, most noticeably with the United States. Washington had since 1990 increasingly moved away from trying to resolve the Kashmir dispute to merely managing its occasional irruptions, leaving conflict resolution to the bilateral efforts of India and Pakistan (Schaffer 2009: 6–7). A number of Kashmiri lobbies in Brussels eventually ran afoul of the Belgian government because of their affiliations with Pakistani intelligence (Racine 2015: 23). European officials and parliamentarians were allowed to visit Indian Kashmir from 2004 onwards. With the ground situation in Kashmir having improved, this worked in India’s favour in the long run. The visit of the European members of the India-EU Round Table on Civil Society Dialogue to Kashmir in June, for example, helped a swathe of Europeans to get a better understanding of Kashmir’s complexity (Mukherjee 2018: 159). Indian officials cite the extensive 2007 report written by the then British Liberal Democratic member of the European Parliament, Baroness Emma Nicholson, as a ‘turning point’ in attitudes in Strasbourg.5 Her ‘Report on Kashmir: Present Situation and Future Prospects’ incorporated extensive groundwork in both Indian and Pakistani Kashmir. It was unusually critical of how Islamabad ruled and governed its part of Kashmir and compared it unfavourably with India’s democratic rule. It was also critical of extra-judicial killings by Indian police and security forces. However, a number of its conclusions on the foreign policy front, including that a United Nations Security Council mandated plebiscite

5 Private conversations with Indian diplomats who served in Brussels.

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would not be in the interests of the Kashmiri people as a whole, were in line with India’s position (Andley 2007). Despite strong protests by a handful of parliamentarians, the report was passed overwhelmingly by the European Parliament. Of a total of 57 amendments to the Bill, 25 were voted through including a mention of Kashmiris’ right to self-determination. But the references to the plebiscite’s obsolescence were retained as were the criticisms of Pakistan’s treatment of its own Kashmiris (Lal 2007). According to Indian officials, the report cleared up many misconceptions about Indian rule of Kashmiris among European politicians and did fatal damage to Pakistan’s claims to be a protector of Kashmiri rights.6 One European South Asian specialist called it ‘by far the most detailed public document emanating from an EU institution on Kashmir’ (Racine 2015: 21–22). The European Parliament continues to be the source of resolutions and debates that New Delhi would probably wish never happened. But these non-binding votes no longer question that Kashmir is part of India and focus largely on purely human rights issues or the need for India and Pakistan to hold talks. Some are actually full of praise for India, especially as Kashmir sees insurgency wane and its political process becomes more normal. Pakistan rarely receives a good word and the legitimacy of Kashmiri separatists is often questioned in the new resolutions. For instance, on 10 December 2014, the European Parliament praised the successful conduct of elections in Indian Kashmir in 2014, obliquely questioning separatist claims and Pakistan’s support for them (PR Newswire 2014). ‘European governments use the EU bodies, like the Parliament, to push controversial policies on countries like India; a bit of good cop versus bad cop. Climate change is one of these topics. But they’ve realized that Kashmir is too sensitive for them’, said an Indian diplomat. New Delhi on its part understands that allowing Strasbourg to debate Kashmir is a good way ‘to let off some hot air’ and makes it easier for EU officials to avoid talking about the issue.7 This sort of moral hair-splitting was markedly different from what New Delhi experienced with the US position on Kashmir. US foreign policy in the post-World War II era was driven less by moral concerns than by the

6 Private conversations with former Indian ambassadors to the EU. 7 Conversations with Indian diplomats who served in Brussels.

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hard containment of the Soviet Union. There was an additional American tendency to not look at first principles but rather see Kashmir as a managerial question demanding a solution. If human rights or self-determination was a part of the solution to Kashmir, then Washington would be for it. However, thanks in part to entrenched Indian opposition over the years, the US quickly concluded a policy based on idealistic formulations like a plebiscite would lead into a cul de sac. In the final analysis, Kashmir was simply not important enough for the US to throw its full political and economic weight into contention. Ultimately, the United States had overriding strategic interests regarding South Asia. This meant, not unlike the larger European states, it would give at best rhetorical support to a values-based Kashmir policy.

Return of Realism Europe changed its tune regarding Kashmir from 2001 onwards. The initial change in tone took place because of the 2001 Al Qaeda attack on the US, popularly called 9/11. The attack ‘would fundamentally alter Western policy towards Afghanistan and Pakistan’ and it would ‘redefine and reshape’ the India-EU strategic partnership in subsequent years (Mukherjee 2018: 166). The EU, led by Solana and similar-minded members of the Commission, laid out a new security policy in 2003 that implicitly downplayed human rights concerns and placed a priority on cooperating with governments like India on security issues. The 2018 EU strategy paper on India was arguably a linear descendant. A supplementary development was the Indian Kashmir Assembly election of 2003 that began a downward trend in local Kashmiri support for the insurgency against India. The 9/11 attack was clearly the major factor for the United States. After that, the Kashmir militant movement was simply outside the pale. It was Islamic, it was terroristic and many militant groups fed off the same jihad infrastructure used by the Taliban and the Al Qaeda. Though Pakistan fought a valiant rearguard action, trying to keep militant groups whose operations it supported in Kashmir like Jaish-e-Mohammed and Lashkar-e-Taiba off the US’s terrorist black list, it proved an impossible task (Tankel 2010). The Kashmir Assembly elections probably contributed as much to the EU further muting of its criticism of India’s policies in Kashmir. India’s willingness to allow international observers during the elections ensured

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that even the traditional alliance of human rights NGOs and smaller north European states had little to complain about. The EU indirectly assisted the election. Its observers were a crucial concession by the Indian government to the Kashmiri people, a recognition of the loss of credibility Delhi had suffered because of past electoral manipulations. Many in the Indian system believed the EU presence helped ensure a higher and legitimate turnout. ‘The international observers are our concession to the Kashmiri people’, said one senior Indian minister at the time.8 The Assembly elections changed the entire complexion of the political situation in Kashmir as far as the international community was concerned. It accepted that the democratic process had been restored in Indian Kashmir and insurgents who continued their armed struggle were more likely to be seen as terrorists than freedom fighters. The 9/11 changed the nature of the debate on terrorism as well. The shift in US policy is relatively obvious. But it also transformed the EU stance. Afterwards, terrorism was on the agenda and on every joint press statement that India and the EU produced. And terrorism was considered unacceptable per se, quite independent of developments in Kashmir or elsewhere. By 2010, the same Rasmussen who had irritated New Delhi at the Copenhagen summit was calling for a dialogue between India and NATO (Aiyar 2010).

Formula for Handling Kashmir The EU and India had developed a formula for handling the Kashmir issue from 2008 that kept it from muddying bilateral ties. This was helped by a nearly decade-long interregnum that saw the return of a normal democratic politics to Kashmir and relatively low levels of violence along the Indo-Pakistani border. Almost every major Western government, including the largest European nations and the United States, said any South Asian peace process is a matter best left to India and Pakistan. Islamabad was no longer able to sell internationalization of the Kashmir dispute as a viable alternative to New Delhi’s bilateral only line. The formula had four elements, which are laid out in a EU communication to a Kashmir NGO (One World South Asia 2012).

8 Private conversation with an Indian cabinet minister at the time of the elections.

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One, human right violations by Indian security forces in Kashmir and elsewhere, along with other such issues, were now raised by the EU in an annual human rights dialogue between the two sides. This allowed Brussels to say it had or would be raising these issues with India. The proceedings of these meetings were not made public and had a formulaic appearance. The Indian side did not take them too seriously. Two, India regularly allowed delegations of EU ambassadors and officials to carry out fact-finding missions to Kashmir. These received little attention and largely consisted of EU officials meeting a cross-section of non-violent Kashmiri opinion. The EU visitors were careful to also distance themselves from separatist groups. In 2009, the head of EU Ambassadors’ delegation, the then Swedish Ambassador, publicly said in Srinagar that the EU holds Kashmir to be an ‘integral part’ of India. In 2011, the EU Ambassador said of Kashmir that ‘There are some issues which you have to settle by yourselves’ (Bhukhari 2009). Third, the EU contributed humanitarian and development assistance to Kashmir on a regular basis, something that received much praise from the European Parliament (European Commission 2017). The EU assistance included special programmes to provide therapy and assistance to the victims of violence. Finally, Brussels rhetorically supported ‘reconciliation’ between India and Pakistan without providing any details of what this entailed or whether the EU had any role in such a peace process. This was easier to maintain when there was evidence that India and Pakistan were interested in pursuing such a process, as was the case during the Atal Bihari Vajpayee and Manmohan Singh governments in New Delhi. A more passive EU position on Kashmir is evident in Brussels’ statements from 2012 onwards. The Asia head of the EU External Relations Directorate, asked about third party mediation in the Kashmir dispute, responded ‘such a course of action would require conditions which are not presently met’. One commentator has noted that in the nearly one thousand statements and remarks by the EU High Representative Catherine Ashton between December 2011 and February 2013 listed on the EU website ‘not a single one is explicitly focussed on Kashmir’ (Racine 2015: 17). India continued to tom-tom that an end to Pakistani-backed ‘crossborder terrorism’ was the real solution to Kashmir’s problems. During its first term, the Narendra Modi government indicated it was interested in talks with Pakistan, but signalled it would not pursue a peace process at

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any cost and that overly aggressive Pakistani behaviour would put talks on ice. One such signal, ordering large-scale Indian shelling across the Line of Control in response to similar actions by Pakistan, led the EU Ambassador to Pakistan, Lars-Gunnar Wigemark, to say that ‘efforts to re-launch bilateral dialogue should remain a priority’ (Yousaf 2014). The EU’s quiescence regarding Kashmir during this time was partly contextual. While a deterioration of India-Pakistan relations was expected to be one of the elements that could lead the policy to change, Indian diplomats came to believe that in the decade after 2008, Europe’s gaze had turned elsewhere, its interests regarding New Delhi reduced to economics and climate change, and that an earlier sense of Europe becoming a major trend-setter in values-based diplomacy had waned.

End of Special Status The new EU approach to Kashmir was tested in August 2019 when the second-term Modi government ended the state’s special status under Article 370 of the Indian Constitution, suspended the state government and placed hundreds of its political and civil society leaders under arrest and announced that the future status of Kashmir would no longer be a matter of discussion with Pakistan. The Indian Parliament overwhelmingly voted to bifurcate Jammu and Kashmir into two union territories, states where executive power lay with the central government. Fulfilling a long-standing BJP electoral promise, the Shia-Buddhist region of Ladakh was made into a separate territory. The government promised to eventually free the detained Kashmiri leaders hold elections to allow for a representative Assembly, and vaguely spoke of eventually restoring statehood but without any special status (Bachhawat 2019). The motivations behind this policy went back to 2016. The death of a minor Kashmiri militant, Burhan Wani, led to three months of local protests. Indian intelligence, in their subsequent analysis of the riots, noticed Pakistan had no intimation of the riots; the protestors never raised slogans or flags in favour of Pakistan and the only external name invoked was that of the Islamic State. The Indian government saw this as an inflection point in their long-standing policy regarding Kashmir. Since the 1950s, the cornerstone of New Delhi’s Kashmir policy was the quest for an understanding with Islamabad under which the former would accept Indian sovereignty over the Kashmir in return for India extending some form of autonomy to the state’s people. The 2016 riots indicated that

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even if India reached an accommodation with Pakistan, it would be irrelevant to the alienation of the Sunnis in the Kashmir Valley who were the core of the secessionist movement (Pal Chaudhuri 2019). Through 2017 and 2018, the Modi government carried out a major overhaul of its Kashmir policy. The new starting point: any Kashmir settlement had no place for Pakistan and would have to work out within the Indian polity. There were two paths New Delhi could have taken. One path was to grant greater autonomy to the state, the other was to convert Kashmir into just one more state of the Union. Given the ideological bent of the ruling BJP, its leadership’s belief in a strong unitarian state and its internal narrative that Kashmir’s special status only encouraged separatist tendencies, it was probably inevitable the Modi government would choose the second path. The swiftness of the change and the lack of any local political process were seen as the most controversial facets of the decision, otherwise there was little dissent and considerable support in the rest of the country. What was definitely controversial was the government’s decision to suspend the state government, including its legislature, impose a curfew and communications blackout on its people, and arrest most of the known Kashmiri political leaders. As one of the leading Kashmir experts of the country noted, ‘New Delhi has made the entire pro-India political mainstream in the Valley politically irrelevant, administratively powerless, and worthless from a conflict-resolution perspective’ (Jacob 2019). Indian officials argued these drastic actions were necessary from a security point of view to absorb the inevitable backlash, whether in the form of riots by local Kashmiris or terrorist violence by Pakistan-supported militants. Privately, officials said that most of the politicians that had been detained had long been covertly financed by either India or Pakistan, ‘or sometimes both’. New Delhi had always seen them as a stopgap arrangement designed to provide a democratic outlet for Kashmir nationalism until the time a final settlement with Pakistan was reached. With the new policy, their utility had come to an end. Incarcerating them was seen as a move to protect some of them, a means to force others to recognize their diminished role in the changed environment and a way to gain more time for the government to usher in a new generation of Kashmiri leaders not steeped in the thinking of the past. This process was accelerated by allowing long delayed local elections and eventually updating the electoral boundaries to reflect a shift in population to the Hindu-dominated Jammu region (IANS 2020).

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Europe Reacts The reaction of European governments was generally measured despite being caught by surprise by Modi’s actions. Brussels chose to stress the need to avoid increased tensions between India and Pakistan. The British and French government said they were monitoring developments and that Kashmir was a matter between the two South Asian neighbours. There was little public reaction to the change in Kashmir’s special status. Official comments and implicit criticisms were overwhelmingly about the arrest of the political leaders, the suspension of the Assembly, the restrictions on communications and movement imposed on the Kashmiri population. While New Delhi, in briefings to foreign governments, laid out its plans to restore democracy and civil liberties to Kashmir over time, the EU and many European governments felt it important to hold the Modi government’s feet to the fire on these concerns. But the European Parliament’s concerns about India’s human rights record were revived and the Kashmiri lobby groups in Strasbourg resurrected. There was a move in the European Parliament to debate the Kashmir action in late September which received wide support from the parliamentarians. However, Brussels declined to support the action and discussion was postponed twice until overtaken by the COVID-19 pandemic (Haider 2020a). In October 2019, the Indian Government organized a visit by a group of over 20 right-wing EU parliamentarians to Kashmir in an attempt at showing there were elements in Strasbourg who supported the Indian policy. The delegation visit, organized by the Indian intelligence system, was derided within India with even the Foreign Ministry distancing itself from the programme (Choudhury and Dhawan 2019). Brussels continued to quietly press India on the civil rights issues in Kashmir. At various United Nations venues, EU representatives made it a point to insert a few lines on the need for India to lift its restrictions on Kashmir. In December 2019, that ‘freedom of movement and means of communication are restored along with all essential services. We have urged a restoration of normalcy, while we do understand India’s security concerns’ (European External Action Service 2019a, b; Haider 2020b). One EU official told an Indian journalist that the European Union ‘is keener on getting the trade and investments pacts concluded with India rather than speaking on issues like Kashmir’ (Roche 2020; Basu 2020). Looming on the horizon was a rapidly growing belief in Brussels that at a time when the United States, China and Russia were simultaneously

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undermining the rules-based international system, it was more important to work with the Modi government which, though nativist and right-wing, was democratically elected and had preserved India’s foreign policy traditions on multilateralism. Modi differed from most right-wing leaders in being genuinely concerned about climate change. In a speech in New Delhi in January 2020, High Representative of the European Union for Foreign Affairs and Security Policy Josep Borrell, less than two months after assuming office, outlined a worldview that saw multilateralism under siege, the ‘law of the jungle’ encroaching on the world and where Europe needed to reach out to countries like India. ‘It is essential that we develop a new roadmap for our strategic partnership in the 2025 horizon, covering cooperation in areas from security, to digital or climate change’, he said. The relationship between India and Europe ‘must become more strategic given the importance of the Indo-Pacific region’. He said negotiations on this roadmap had begun ‘yesterday’ and he hoped they would be ready in time for an EU-India summit in March 2020 European External Action Service (2020). Indian Foreign Minister S. Jaishankar, at a meeting with the EU Foreign Ministers in Brussels the following month, also stressed the importance of strategic relations given global challenges. He also defended the new Kashmir policy as fundamentally better for its people, even though implementation ‘challenges’ were there. ‘Kashmir in its social-economic outlook was less and less aligned with the rest of India because the rest of India is moving in a very progressive direction’ (Press Trust of India 2020). In February and March, a number of foreign ambassadors based in New Delhi were being given tours of Kashmir. The second batch was mostly European envoys including the EU High Representative. The latter issued a statement saying the visit had ‘confirmed that the Government of India has taken positive steps to restore normalcy’, but that more needed to be done. On 5 March 2020, India restored limited Internet and phone connectivity to Kashmir. From 12 March onwards, the government began freeing the political leaders it had detained with the last few being let out by the end of May 2020. However, the more fundamental issue of holding elections and having the State Assembly restored remains pending and given the difficulties in redrawing the electoral districts and the disruptions caused by the COVID-19 global pandemic is unlikely to happen any time before 2021. The European Union and Europe as a whole have moved away from the UN resolutions regarding Kashmir. Even their calls for a dialogue

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between India and Pakistan are sounding increasingly formulaic. After the amendment of Article 370, the United States and Russia declared Kashmir was a purely domestic issue and India expects European governments to follow this line, de facto if not de jure. Since 2001 Brussels had begun moving to a more realist relationship with India where human rights and postmodern values were being subsumed by larger strategic concerns. While counterterrorism had been an important driver in the past, increasingly the EU is more worried about the erosion of the multilateral system from numerous challenges. This trend was arrested by the 2020 pandemic which delayed the planned Indo-EU summit, but it is a trajectory likely to continue over the coming years.

Postmodern Worldview The former British diplomat Robert Cooper argued that the real cause of the differences in foreign policy lies in the increasing trifurcation of the world into three types of nations: pre-modern, modern and postmodern. The pre-modern states are perhaps better known as the failed states. They include a swathe of nations in Africa and arguably a few in West and Central Asia. The modern states are the bulk of the world’s nations. But the best examples would be the nations of Latin America and Asia. Finally, he argues, there are postmodern states of which the best example is the members of the EU. He lists a number of characteristics of such nations; but what is notable about them is their willingness to dissolve their sovereignty into a larger commonwealth. Security lies in openness, transparency, the promotion of common values and a dilution of territorial integrity. As Cooper writes: ‘The postmodern system in which we Europeans live does not rely on balance nor does it emphasize sovereignty or the separation of domestic and foreign affairs. The European Union has become [a] highly developed system for mutual interference in each other’s domestic affairs, right down to beer and sausages’. He argued, ‘The EU is the most developed example of postmodern system. It represents security through transparency, and transparency through interdependence’ (Cooper 2003: 24). Many countries combine characteristics of at least two such state varieties. For example, a question mark lies over the United States which, especially in the period after the Cold War, began moving on the postmodern path. However, after 9/11 it became a modern state with a

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vengeance. And though it developed a more benign worldview during the Barack Obama Administration, generally Washington has become ever more willing to use coercive and unilateral tactics for security reasons. The EU is itself a building under construction. Its Member States are far from homogenous in the degree to which they are willing to subsume national interests to global ones. This is evident by the extremely limited contours of the Common Foreign and Security Policy. Roughly speaking, the nations where the postmodern view of foreign policy has taken root the strongest are the smaller European nations whose global interests are restricted to the economic sphere but whose stake in the pacification of the Europe is the highest. Most diplomats point to the Scandinavian and Benelux nations as being the most willing to argue for a foreign policy based on values, idealpolitik rather than realpolitik. At the other end of the spectrum are France and Great Britain, nations whose national interests span the globe and whose willingness to constrain their foreign policy to a consensus of other European Union states is probably the least. Germany, the economically most powerful EU state but strongly inclined to being only a civilian power, lies squarely between the two extremes. France is perhaps closest to waging a foreign policy in a manner not dissimilar to the United States; in other words, in a manner that would be recognizable to a nineteenth-century great power. This reflects the fact that France, alone of the EU members, still aspires to have a global leadership role. Britain, since the 1957 Suez Crisis, has concluded its interests are best served by subsuming them into those of a larger AngloAmerican cause. However, it is important to accept that all Western European nations accept that the peace and security of their continent depend on the continuation of the EU. Even the British establishment strongly support the idea, though the popular vote to leave the EU—the Brexit referendum—may eventually lead London to move to a nebulous independent foreign policy path. The largest European states are no different in that belief than the smaller Member States of the EU. But they pursue what amounts to a two-track policy of defending their interests as well as promoting those of Brussels at the same time. One of the reasons the EU seems to speak with so many voices is that very often London, Paris, Berlin and even Rome fail to juggle all these balls. They very often hide behind the shield of the smaller European countries—and often blame them for value-based

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policy statements that they are not averse to but are damaging to their geopolitical interests. As Cooper wrote, postmodern Europe practices double standards. ‘Among ourselves we operate on the basis of laws and open cooperative security. But when dealing with more old-fashioned kinds of states outside the postmodern continent of Europe, we need to revert to the rougher methods of an earlier era – force, preemptive attack, deception, whatever is necessary to deal with those who still live in the 19th century world of every state for itself’ (Cooper 2003: 61–62). Because of the stress on the link between transparent domestic policies and cross-border peace, Brussels also places an inordinate emphasis on human rights.

Modernist India India, in contrast, is a post-colonial state in an advanced but still continuing process of nation-building. New Delhi is famously prickly about even perceived infringements of its sovereignty. The Indian establishment is overly concerned about preserving the autonomy of its policy-making and preserving its territorial integrity. Even by the standards of other emerging powers, India is sovereignty conscious. Lal determined that members of India’s strategic community put the loss of sovereign decision-making as its number one concern, much more so than their Chinese counterparts (Lal 2006: 76–77). India’s post-independence experiences with limited wars and crossborder terrorism have only strengthened its modernistic attitude towards security in general. The Indian political system and its public are prepared to put aside liberal democratic principles, albeit temporarily, for threats to the country’s security. This is most evident in New Delhi’s policies towards its most rebellion-prone regions, viz. Kashmir and the Northeast. India sees dialogue, whether with representatives of Kashmiri separatism or Pakistan, as one among several instruments in a broader strategy of handling both domestic insurgency and Pakistan. And, in addition, an instrument that can be turned on and off, and used in tandem with force and the threat of military power. The EU, on the other hand, see dialogue as a constant that must never be removed from any conflict-resolution equation, with coercion being the variable in the equation and one best avoided. The credibility of Brussels’ view has not been enhanced in New Delhi by the fact the EU speaks with different voices and worldviews.

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When India and the EU negotiated a strategic partnership agreement these contrasting views were evident from their respective approaches. India saw a strategic partnership to be almost solely about hard security cooperation—active intelligence sharing and obstructing terrorism finance. India saw the isolation of a terrorism sponsor Pakistan as one of its policy priorities (Mukherjee 2017: 107). Brussels had a broader definition of security that included a number of its multilateral goals. ‘For the EU, its priorities for the partnership continued to include a commitment to hyphenation [of India with Pakistan], to bringing India into the nuclear Non-Proliferation Treaty and rolling back India’s nuclear weapons status’. The EU also pushed for a human rights dialogue with India as part of the security partnership, something India saw as irrelevant to the issue. Brussels’ position paper argued that ‘establishing the rule of law and protecting human rights are the best means of strengthening the international order’ (Mukherjee 2017: 104–105). In the case of the Kashmir issue, Indian diplomacy sought to exploit the multiple voices that the EU used when discussing the subject. With minimal likelihood of Brussels applying sanctions or any other tangible sanction against India, it is unlikely New Delhi would have ever conceded any policy space on Kashmir. But faced with a EU that spoke in both postmodernist and modernist language regarding Kashmir, New Delhi’s officials would have assumed that they could afford to simply wait until the more pragmatic EU position asserted itself. It ignored the human rights rhetoric of Rasmussen and looked for Solana’s realism to become Brussels dominant position regarding Kashmir and India as a whole. It is important to recognize that India believed its ultimate political goal in Kashmir—the restoration of local democracy and Kashmiri faith in the Indian Union—was largely in line with what the EU would have wanted. The differences were more tactical then fundamental. However, a fiercely sovereignty conscious India could never countenance external intervention in any way in such an issue. On this point, the EU and India were and remain miles apart. As in so many other international issues, on Kashmir ‘India and the EU share common objectives, but these relate more to general principles for the global order than to details and deliverables’—and this remains a key obstacle to a more effective relationship (Von Muenchow-Pohl 2012: 2). Ultimately what gives the relationship an increased expectation of convergence is the declining salience of postmodern values in a twenty-first century increasingly marked by great power rivalry.

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CHAPTER 11

India, Europe and Afghanistan Vivek Katju

Introduction I approach the subject, ‘India, Europe and Afghanistan’, from the perspectives of Indo-European interaction on and via Afghanistan. My focus is on the post-1947 period as well as on two phases of interaction in the past, one remote and the other in essentially the nineteenth century. The last mentioned was embedded in colonialism. It was essentially intra-European with Britain and Russia as the protagonists. The British acted to secure their Indian possessions. The actions of the two European powers had historic and lasting impact. The current territorial structures of Afghanistan, Pakistan, Turkmenistan, Uzbekistan and Tajikistan are a result of the clash and understandings reached between the two colonial powers. I propose to cover the subject in five phases: (a) Afghanistan as transit point for Alexander’s invasion of India in 326 BCE and the nature of its impact; (b) Afghanistan as buffer. It became so as Britain and Russia manoeuvred in what is called the Great Game in the nineteenth century;

V. Katju (B) Former Secretary (West) and Ambassador to Afghanistan, Government of India, New Delhi, India © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 R. K. Jain (ed.), India, Europe and Asia, https://doi.org/10.1007/978-981-33-4608-6_11

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(c) Afghanistan as a Cold War arena; (d) Afghanistan as a terrorism centre pre-9/11; and (e) Afghanistan as post-conflict laboratory.

Afghanistan as a Transit Point Alexander’s invasion of India through Afghanistan in 326 BC and his battle and victory over Porus and, thereafter, his respectful treatment of his defeated adversary is part of the Indian consciousness. His army was exhausted and fearful of what it may encounter next and did not cross the Beas. The great conqueror retreated and made his way back principally via the Makran coast to Babylon where he died. Did Alexander’s invasion make a lasting impact? Certainly, whatever happened thereafter is not generally in India’s historic consciousness. Some Indians are today aware of Megasthenes as Seleucus Nicator’s Ambassador to Chandragupta Maurya’s court. His actual work on India is lost but is a source of later writings on the India he saw. Greek influence did spread but its extent and depth are debatable. Louis Dupree notes in his book, Afghanistan, ‘The death of his political empire and the birth of cultural Hellenism rapidly followed Alexander’s death’ (Dupree 1973: 283). As his empire split, Seleucus took over his eastern possessions but the Seleucids could not exercise full control and satrapies with varying independence emerged in Afghanistan. These interacted with India; territorial control changed from time to time and incursions in both directions took place. It is noteworthy that Ashoka pillars discovered in Kandahar are in Greek. Culturally, the IndoGreek interaction impacted sculpture as witnessed in the Gandhara and the Mathura schools. Gandhara influence died after a few centuries, and with the coming of Islam in Afghanistan it lost relevance as a motivator for action. Its monuments remained as a reminder of that intermingling. They reminded Afghans even in the twentieth century of their pre-Islamic history. It was that memory that led many to lament the destruction of the Bamiyan Buddhas by the Taliban.

Afghanistan as a Buffer Europe had no part in the events that took place in what is now the north India-Pakistan-Afghanistan region for more than a millennium and a half following the Greek interaction. Hence, the threads can be picked up in

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the eighteenth century by which time the age of Western colonialism had begun. Since the time of Peter the Great (1682–1725), Dupree points out, Russia ‘coveted warm water ports to the south, either on the Dardanelles, in the Persian Gulf or in the Indian Ocean. The Russian drive to the east began in 1734 with movements in Kazakhstan and ended only when the great Asian empire of Russia reached the shores of the Pacific and went on Alaska and California’ (Dupree 1973: 363). In this context, one should note that Russia abandoned its Californian territories only in 1844 and sold Alaska to the United States in 1869 for US$7.2 million. Dupree focuses on Russia’s drive to the east. However, the movement to the south towards what is now Turkmenistan, Uzbekistan and Tajikistan continued unabated in subsequent decades and filled the British, who were in the process of expanding their empire in India, with periodic anxiety. The British were very apprehensive that Russia might cross the Amu Darya, move through the Hindu Kush and thereby directly impact their Indian possessions. Thus, the theatre where the British-Russian rivalry played out through the nineteenth century was Afghanistan. The British objective was to deny Russia influence south and west of the Amu Darya leave alone have a physical presence there of any kind, including diplomatic. To that end, British policies and strategies fluctuated between physical intervention and maintaining a careful watch over developments there, exercising influence by financing Afghan chiefs as well as by undertaking a calibrated supply of munitions to exercise control over the foreign relations of the Afghan ruler. What was the nature and condition of Afghanistan that had to deal with two aggressive and expansionist European powers? The present-day Afghan state traces its establishment to 1747. Ahmed Shah, a Popalzai commander of the Persian ruler Nadir Shah who was murdered that year too, was accepted as the leader of the Abdalis in Kandahar and called Durr-e-Durran (pearl among pearls). Since Ahmed Shah, the Abdalis have also called themselves Durranis. Next to the Ottoman Empire, the Durrani was ‘the greatest Muslim empire in the second half of the eighteenth century’ (Dupree 1973: 334). It included territories west of the Indus which the Durranis had seized from the, by then, enfeebled Mughals. In India’s historic consciousness, Ahmed Shah is remembered as the victor of the third battle of Panipat where he defeated the Marathas. For many Indians, he was an Afghan lootera (robber) but to the Afghans, especially the Pushtoons, he is their greatest national hero.

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Ahmed Shah died in 1772 and his son Timur Shah reigned for 21 years. However, the latter did not have his father’s vigour. As a result, Afghanistan gradually lost control over its Indian dominions and the power of Iran increased. Afghanistan became a melange of shifting principalities. This is the Afghanistan which had to deal with the British and the Russians in the nineteenth century. The ‘Great Game’ offers a fascinating study of how perceptions, misperceptions, misplaced fears, aroused national feelings and domestic politics can influence foreign policies and lead to disasters as witnessed in the first and the second British-Afghan wars in 1839–1842 and 1878– 1880, respectively. Both these wars revealed the enormous costs that had to be paid for military operations if the terrain of a country is geographically hostile and the population unreconciled. However, the two wars eventually gave Britain control over the foreign relations of Afghanistan. That position continued till 1919 when following the third Anglo-Afghan War (1919) the British relinquished that control leading Afghanistan to celebrate till today that day as its Independence Day. The territorial configuration of Afghanistan, even though it was never colonized, was mainly decided by Britain and Russia. The underlying objective of the territorial determination was to ensure that the British Indian Empire and the Russian Central Asian Empire did not become contiguous. Thus, Afghanistan was to be a buffer. Its northern and northwestern and north-eastern boundaries were delineated and determined in about two decades beginning 1869. Afghanistan, in fact, had no problems with these boundaries. However, this was not the case with the border delineated with British India which divided the Pashtun lands. That process was negotiated by Mortimer Durand and Amir Abdul Rehman Khan in 1893. Did it lead to the creation of spheres of influence or delineate and demarcate an international boundary? For the Afghans, it was never the latter. That is the position it holds to this day though Pakistan has tried everything to make Afghanistan accept the Durand Line as the international border. Most European governments treat the Durand Line as the international border, and for all practical purposes, India does the same. The Afghan-Iranian boundary was delimited between 1871 and 1935 through neutral arbitrators first the British and then the Turks. During the First World War, Indian nationalists led by Mahendra Pratap, who were then in Europe, established the Provisional Government of India in Kabul. The Axis powers promoted these moves for they hoped to rouse the Pashtun tribes against the British in India. The Afghan

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Amir was neutral till the British forced him to close this enterprise. Thus, once again Afghanistan became an area for European rivalry in the Indian context. Afghanistan was the route taken by Netaji Subhas Chandra Bose to travel to Europe during the Second World War. He was helped by German and Soviet intelligence in his escape and travel. This is an interesting footnote.

Afghanistan as a Cold War Arena The partition of India fundamentally changed territorial structures and equations between the Indian subcontinent and Afghanistan. The British departed and it was Pakistan which inherited their mantle in respect of Afghanistan. The Afghans refused to acknowledge Pakistan as a successor state. It was the only country that voted against its admission to the United Nations. It had urged Britain that the North-West Frontier Province (NWFP) should be given a choice of not only joining either India or Pakistan, but also merging with Afghanistan. Britain refused. Afghanistan continued to agitate for its merger by raising the Pashtunistan issue which caused immense problems for Afghan-Pakistan relations. Pakistan began to develop a paranoia as independent India’s relations developed with Afghanistan. It feared encirclement from both its western and eastern fronts, especially as its relations with Afghanistan continued to be deeply troubled in the 1950s. However, in the 1960s, Afghan-Pakistan relations improved and Afghanistan remained neutral during the 1965 India-Pakistan War. It did so too in the 1971 War. The fundamental changes that took place in the Indian sub-continent after the Second World War coincided with the transformation of the world order itself. The European colonial powers became subservient allies of the United States and the Soviet Union which led the rival communist bloc. Both blocs became entangled in a Cold War which was played out globally through four decades. Obsessed with containing the Soviet Union, the United States in the 1950s decided that Pakistan would be its ally. At the time, Washington had no real interest in Afghanistan though it did support a few major developmental projects. What Russia could not achieve during the Great Game in Afghanistan, the Soviets now did as they began to gain access to different segments of Afghan society and polity.

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If the United States did not contest the growth of Soviet influence in Afghanistan, their European allies did not seek to do so either. There is little to indicate that West Europe, Britain included, did anything more than maintain diplomatic ties. Certainly, there was no desire to fashion events in Afghanistan. There is also no evidence of any significant IndianEuropean interaction on Afghanistan during the twenty-six years from Indian independence to Daud Khan’s overthrow of King Zahir Shah in 1973. That event changed the course of Afghanistan’s history and set in motion developments that fundamentally impacted on the region and the world. Afghanistan could not remain isolated from the winds of change that swept across the world after the Second World War. This period witnessed decolonization in Asia and Africa and the emergence of new states. It was an era that witnessed the youth in developing countries drifting towards leftist ideologies. The Afghan youth could not remain unaffected in spite of deeply entrenched Islam and social conservatism. The Afghan Communist Party was established in 1965 although initially its leadership did not reveal its ideology. As more and more Afghan military and civilian officers began to go to the Soviet Union for training, it was inevitable that some of them would be influenced by Marxist thinking. Daud Khan used them to overthrow the monarchy, of which he was an inherent part. Their alliance, always uneasy, lasted for five years, ending in 1978 when the communists murdered Daud and almost his entire family. The communists were faction-ridden and their cleavages, which had surfaced soon after the establishment of the party, turned violent. Hafizullah Amin murdered Taraqi and took over power. The Soviet Union looked warily at these developments as Afghan society and polity reacted forcefully and violently against the Communist Government. The year 1979 brought about seminal changes in West Asia. In Iran, the Islamic Revolution swept aside the Shah and paved the way for the return of Ayatollah Khomeini. In Iraq, Saddam Hussain took over the presidency. In Saudi Arabia, the holy mosque in Mecca, which houses the Kabah, was besieged by a fundamentalist group claiming that the Saudi royal family had broken the Wahabi compact. In Pakistan, General Ziaul-Haq executed the former Prime Minister, Zulfiqar Ali Bhutto. Taken together, these developments posed challenges for the national interests of both the superpowers. The Shah and Saudi Arabia were among the anchors of American West Asian policy. Iran labelled the

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United States as the great Satan. In November 1979, when Iranian students took over the US embassy in Tehran along with 400 diplomats and support staff as hostages, Washington faced an abyss. On its part, the USSR was deeply troubled by the possible impact of the Iranian Revolution on its Central Asian states. It feared the extension of Islamist forces taking hold of Afghanistan. It could not therefore contemplate abandoning the influence it had gained in that country through the communists. In these circumstances, the Soviet leadership decided to send its military forces across the Amu Darya, overthrow and kill Amin, and consolidate communist authority under a regime that would be fully dependent on it. The United States had begun supporting the anti-communist forces in Afghanistan prior to the Soviet military entry. It opposed the Soviet move and decided to give all-out help to the Afghan Islamist groups who were based in Pakistan to ensure that the communist rule would not get consolidated. The violent methods adopted by the Afghan government and their social and economic programmes led to the flight of refugees to Pakistan, Iran and in smaller numbers to other parts of the world. Consequently, Afghanistan plunged into violent civil conflict. Afghan Islamic groups committed to national freedom and inspired by religious zeal found Pakistan a hospitable base for their struggle against the Soviet presence in their country. The United States and its West European allies and the Islamic world promoted and fully aided them. Indian and West European approaches to the Afghan jihad were the products of their compulsions and preservation of national interest. Neither were arbiters of Afghan developments. They were essentially witnesses to a conflict in which the principal players were the two superpowers. West Europe, like the United States, saw an opportunity in the unfolding Afghan situation to strike a massive blow to the Soviet Union and supported American objectives. New Delhi was unhappy with the Soviet military presence and privately made its views known to its leadership. It did not, however, go public with its concerns or criticize the Soviet move. Pakistan became a frontline state in the 1980s. General Zia’s overthrow of democracy and his perpetuation of military rule was overlooked by Western Europe as much as the United States. The flow of jihadi fighters from across the Islamic world was encouraged to assist the Afghan mujahideen. West Europe, like the United States, did not raise any red

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flags to Pakistan’s pursuit of nuclear weapons. For India, these were issues of vital interest for they directly impacted on its security. Soon after taking over, as leader of the Soviet Union in 1985, Mikhail Gorbachev decided to end the Afghanistan project which had become a ‘bleeding ulcer’. Once it became clear that the Soviets would leave sooner rather than later, the question of Afghanistan’s future government and direction came up. Pakistan clearly wanted a mujahideen government which would be friendly and keep out Indian influence. New Delhi favoured a non-aligned Afghanistan and a government which be based on power sharing among the current antagonists. It was wary of Pakistan which was stoking the flames of Sikh separatism, and there were signs of unrest in Jammu and Kashmir. Europe did not really care about what happened to Afghanistan after the Soviets left it in 1989. The Europeans were preoccupied with the changes in the Soviet Union and the last stages of the Cold War. There is no evidence of any serious India-Europe interaction on the future of Afghanistan though routine diplomatic exchange of views on the Afghan issue continued. Following the Geneva Accords of 1988, Soviet troops withdrew from Afghanistan by February 1989. All attempts of brokering a power-sharing agreement among the contending parties failed. Mohammad Najibullah continued to be in power. Pakistani-aided mujahideen campaigns against him failed. While the Geneva Accords had stipulated that no arms and ammunition would flow to the contending parties, they continued. Finally, the collapse of the USSR led to revolts in Najibullah’s forces paving the way for a mujahideen government in April 1992 and a new chapter in Afghanistan’s troubled history.

Afghanistan as a Terrorist Centre The Western powers simply looked away from Afghanistan and left it to the Afghans and Pakistan to manage the post-Najibullah transition. On the other hand, the collapse of the Najibullah government, with which it had excellent relations, directly affected Indian security concerns. This was especially because Pakistan was determined to foment an Islamic insurgency in Jammu and Kashmir. Pakistan sought to employ the lessons it had learnt in the Afghan jihad and the use of sections of the Afghan mujahideen or its own nationals in Jammu and Kashmir if necessary to launch the Kashmir jihad.

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The situation on the ground in Afghanistan did not go Pakistan’s way. Its protégé Gulbuddin Hekmatyar failed to wrest Kabul from Ahmed Shah Massoud. Burhanuddin Rabbani who took over as President from Fazlullah Mujadedi refused to hand over power. Afghanistan became anarchic with warlords carving fiefdoms for themselves. Kabul became a killing field. The United States and its Western allies simply had no time for Afghanistan as they handled the after-effects of the collapse of the Soviet Union and the situation in the Persian Gulf. At this stage, the Taliban emerged in Afghanistan in 1994. The Taliban replaced Hekmatyar in Pakistan’s affection and it soon became its instrument in Afghanistan. With Pakistan’s help, the Taliban, who captured Kandahar in 1994, ousted Ismail Khan from Herat the next year and pushed Massoud out of Kabul in September 1996. Two years later, they captured Mazar-e-Sharif. With that, the Taliban controlled more than ninety per cent of Afghan territory. Yet international recognition eluded them for the United Nations seat continued to be held by the Rabbani government. This was mainly because of the Taliban’s obscurantist ideology which tried to create a harsh seventh-century polity and society under the guidance of Mullah Omar who arrogated to himself the position of the Amir-ul-Momineen (‘Commander of the Faithful’). Once again Europe was split on Afghanistan. West European countries, especially Britain, were uncomfortable with the Taliban governance and especially its treatment of women. Nevertheless, for both London and Washington, it remained an ‘authentic’ Afghan group since it represented the Pushtoons and their social conservatism. Russia considered the Taliban to constitute a threat to the Central Asian Republics since it had given shelter to Chechen, Uzbek and Tajik terrorist groups. India was opposed to the Taliban on account of its ‘medieval malevolence’, its willingness to be Pakistan’s instrument and its links with international terror. This became more pronounced as the Taliban-Osama bin Laden nexus emerged after 1996. The Al-Qaeda chief had come to Jalalabad from Sudan in the summer of that year. Sheltered by the Taliban, Osama planned terrorist attacks, especially against US interests. American embassies in Nairobi and Dar-es-Salaam were bombed by the Al-Qaeda in the summer of 1998. A futile US missile attack on terrorist training camps followed. The United States and Europe remained focussed on the threat posed by Al-Qaeda and sought to wean away the Taliban from them both through direct contact and via Pakistan.

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Clearly, the Taliban were not considered a threat to American and European interests as they were treated as Afghan centric. The impact of that regime on the region arising from its very nature was ignored. Also ignored was the fact that the Taliban attracted terrorists, including Chechen, Uzbeks, Tajiks and Arabs. India steadfastly supported the legitimate government under Rabbani. There were a few casual meetings between Taliban representatives and Indian diplomats where the former urged that the Taliban should not be considered as Pakistan’s puppets. This was proven to be untrue by their conduct during the hijacking of the Indian Airlines plane, IC 814. During his visits to Paris, Strasbourg and Brussels in April 2001, Ahmad Shah Massoud had warned that the Taliban had made Afghanistan a safe haven for international terrorism. However, his warnings went unheeded. He was killed by two Al-Qaeda terrorists on 9 September 2001. Two days later, the Al-Qaeda flew commercial aircraft into the World Trade Center towers. Through the 1990s, West Europe had little time or patience to seek an understanding of the nature of terrorism that was developing in Afghanistan. It saw terrorism through a narrow lens and thought that advanced countries were largely immune from what was breeding in Afghanistan. On the other hand, India was aware of the growing challenge. However, its warnings regarding the Taliban and of its compact with the Al-Qaeda, which were made quietly in diplomatic conversations, went unheeded.

Afghanistan as a Post-conflict Laboratory In the aftermath of the American action to oust the Al-Qaeda and the Taliban from Kabul, the Western powers’ policies were designed to stabilize the country by demolishing semi-autonomous ‘political’ structures and extending central authority within a rubric of a modern democratic state. This followed the pattern of post-conflict nation-building notions developed by the West and implemented through multilateral action. In this process, social and ethnic realities were overlooked. More significantly, the regrouping of the Taliban in Pakistan and their forays into Afghanistan was permitted as an accommodation of Pakistan for it to deliver the Al-Qaeda on its territory. This Faustian bargain ignored the nature of the Taliban as it was then. The mistake had disastrous consequences for America and its European allies.

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From the time that the United States launched its operations in October 2001 till the present, European powers have not had a discernible independent approach towards Afghanistan. Initially, they largely performed roles assigned to them by Washington. Thus, after the Taliban were ousted from Afghanistan, the British focussed on narcotics control and Germany and Italy on police and judicial reform. Subsequently, as the war continued, European countries found it difficult to justify their combat involvement to their publics and pulled their troops out. During these operations, almost all participating countries suffered casualties: UK: 455, France: 89, Germany: 54, Denmark: 37, Italy: 34, Georgia: 32, Spain: 25, Romania: 23 and so on. Yet none of them publicly questioned the wisdom of US approaches as it went through its different phases. The fatal flaw in the approach of the West in Afghanistan after the ouster of the Taliban lies in permitting Pakistan to give them protection and safe havens. Consequently, the Taliban shuras (councils) operating from Pakistan had the ability to prevent the Afghan government from establishing its writ throughout the country, especially in the south and the east. With the Taliban as a going concern, it was able to attract disaffected elements. Military surges and bombings could not completely root them out since their bases and their leaderships were largely immune from American military power. Mullah Omar’s successor Mullah Akhtar Mansour was killed by the Americans in May 2016 in Pakistan but this was an exception and did not erode the feeling of impunity that the Taliban leadership enjoyed in Pakistan. As the Afghan war continued for nineteen years, both Europe and the United States kept looking to Pakistan to persuade the Taliban to negotiate with the National Unity Government of President Ashraf Ghani and Chief Executive Abdullah Abdullah. As long as Mullah Omar was alive, the Taliban showed no interest in negotiations. With Pakistani support, they were able to carry on armed campaigns including hold territory for some periods. They stuck to their main demand that foreign forces should leave Afghanistan. It became clear by the middle of President Barack Obama’s second term that America was stuck in the Afghan quagmire and did not possess the military means to extricate itself without extending the war to Pakistan. That it was unwilling to do. This resulted in a military stalemate, and by the end of his term, Obama, who at one stage harboured

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the intention of ending the Afghan war, had to accept that the presence of around 14,000 American troops would have to remain there.

Trump and Afghanistan By the time President Donald Trump assumed office in January 2017, the Afghan war had continued for over fifteen years. It had become, by far, America’s longest war without an end in sight. By this time, Europe had simply lost interest in the continuation of the war. It found it futile. Trump too did not display any interest in engaging Europe on Afghanistan. During his presidential campaign, Trump had wanted the troops to come home and the war to end. However, his initial Afghan and South Asia policy, which was announced in August 2017, gave a different indication. While desiring ‘an honorable and enduring outcome’, Trump rejected the notion of a ‘rapid’ exit because ‘the security threats we face in Afghanistan and the broader region are immense’. He accused Pakistan of duplicity and demanded that it should close Taliban sanctuaries. Significantly, Trump moved away from a time-based approach for the conclusion of America’s military engagement in Afghanistan to a conditions-based one. The end goal was a political settlement among the Afghan parties but Trump emphasized, ‘We are not nation-building again. We are killing terrorists’ (Trump 2017). The killing of terrorists was not the way to get out of the Afghanistan mess. The Taliban had a sufficient manpower pool to replenish its ranks. As in the past, the key lay in destroying the Taliban bases in Pakistan. Like his predecessors, Trump was simply unwilling to undertake military action to do this. As the distance grew between Trump’s dire threats to the Taliban and Pakistan and the lack of effective military action, both ignored his rhetoric. The Taliban continued to demand the withdrawal of US forces and direct negotiations with America. They stuck to their refusal to negotiate with the National Unity Government.

Divergent European and Indian Approaches From 2017, the European and Indian approaches to political reconciliation in Afghanistan began to diverge. Both emphasized that the process had to be Afghan-owned and Afghan-led. Both were deeply concerned at Afghanistan descending once again into the chaos of the 1990s. However,

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while the European countries quickened the pace of their direct and open contacts with the Taliban, India steadfastly refused to have any dealing with them. It maintained its traditional policy of maintaining a full-fledged relationship with the legitimate Afghan government. Again, while European countries encouraged America to actively consider negotiating with the Taliban, India continued to have grave misgivings at any policy which would give the Taliban international legitimacy.

Negotiations and the US-Taliban Agreement By October 2018, Trump had caved into the Taliban demand for direct negotiations. American and Taliban representatives began to meet in Doha, Qatar, from that month. This in itself gave Taliban the first objective that they were looking for: global legitimacy. It signalled an American strategic reverse for it constituted an acknowledgement that the world’s pre-eminent power had militarily failed against an insurgent Afghan group supported that used terrorism and was supported by Pakistan. It also eroded the position of the elected Afghan government. Europe went along. India made no statement to support this process. Taliban-American negotiations finally concluded only in February 2020 with an agreement in which the Taliban committed not to allow any territory under their control to be used by any international terrorist group (United States, Department of State 2020). In return, America agreed to withdraw its troops in stages from the country. The Taliban also agreed not to attack American troops but did not give a similar assurance in respect of Afghan government forces. The two parties also agreed that the Afghan government would release 5,000 Taliban prisoners. In return, the Taliban would free government troops in their custody. An intra-Afghan dialogue would ensue following the prisoner release. Europe welcomed this development (see Germany 2020) while India took note. It has not led till now to India establishing an open channel of talks with the Taliban. Clearly, unlike Europe, it was uneasy with the American-Taliban agreement. The main rivals in the Afghan presidential election held in September 2019 were President Ashraf Ghani and Chief Executive Abdullah. The latter accused the former of electoral fraud. The Election Commission went ahead and tentatively declared President Ghani as the victor. Although Abdullah rejected the result, India congratulated Ghani; Europe largely did not do so. Subsequently, when the Commission

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formally declared Ghani as the winner in February 2020, Europe too accepted the result and acknowledged Ghani as the President-elect (Borrell 2020). However, both India (India, Ministry of External Affairs 2020) and Europe were satisfied when Ghani and Abdullah reached a power-sharing agreement in which inter alia Abdullah became responsible for negotiations between Kabul and the Taliban for peace-making.

India and the Taliban For many years, India maintained that the Taliban were not an entity that was worthy of a role in the new Afghanistan. Their medieval character as well as their dismal record of human rights violations could not be ignored. For some years, Taliban representatives approached unofficial Indians on the margins of some conferences urging India not to consider them as stooges of Pakistan. As the momentum grew in the National Unity Government to open up to the Taliban and Ghani went on to offer that they could open a political office in Kabul, did away with the requirement of Taliban acceptance of the Afghan constitution and made talks unconditional, India did not make any adverse comments. It therefore looked upon all this as an intra-Afghan process. Europe openly encouraged it. In this lays the crucial difference between India and Europe on the issue of reconciliation and peace-making in Afghanistan. What India did not do, as noted earlier, was to agree to openly talk to the Taliban while Europe did so.

Indian and Western Development Assistance to Afghanistan India-Afghanistan ties became close with the establishment of the interim and thereafter the transitional Afghan governments in 2002. This process continued with the adoption of the constitution and the presidential election which was won by the leader of the interim and the transitional arrangements, Hamid Karzai. New Delhi made a major contribution to the economic and infrastructural reconstruction of Afghanistan. Unlike Western donors, India did not seek to give advice on either economic models or policy approaches; it simply undertook projects, where it was possible for it to do so. Surveys undertaken by neutral observers showed that the Indian approach to assistance was popular in Afghanistan. It covered a wide field

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from road construction to the national parliament building in Kabul to the Salma hydroelectric dam in Herat to the power transmission lines over the Hindu Kush into the Shomali Plains and thence to Kabul. Other projects included training of the bureaucracy and the security forces. Small and medium projects all over the country were also undertaken. Initially, Western countries were wary of India supplying lethal equipment to the Afghan army but later gave up a negative attitude to such supplies. Western approaches to Afghan assistance had to take into account the sensitivities of their publics to the treatment of women. They also relied heavily on NGOs for delivery. Their administrative costs were much higher and the Afghans witnessed the heavy footprint of their aid apparatus.

Perceptions of Pakistan’s Role in Afghanistan The shadow of Pakistan fell on India-West interaction on Afghanistan. As Islamabad’s unfounded fears of growing Indian influence in Afghanistan increased, the West warned Afghanistan to take Pakistani concerns on board while enhancing ties with India. This was especially so regarding the security sector. However, as President Karzai’s suspicions of the United States and of Pakistan increased, he turned to India and it was the first country with which he entered into a strategic partnership. In time, however, European concerns over Indian weapon supplies to the Afghan forces, which was in any case very limited, decreased. There was a difference in Indian and European perceptions on Pakistan’s role in Afghanistan. While India privately acknowledged that Islamabad had interests in Afghanistan, it felt that it was a spoiler. This was because it wanted to control Kabul’s external choices—an accusation that the Afghan authorities made themselves. For Europe, the Taliban was indispensable to Afghan reconciliation and peace, and therefore, it treated for the most part with kid gloves. This was despite Pakistan consistently being a negative factor in Afghanistan.

Conclusion A major area of concern in Afghanistan is its becoming the world’s largest producer of illicit opium. The main destination of Afghan opium and its derivatives is Western Europe. However, this also adversely impacts India and the region as a whole. It is one crucial factor in civil conflict. It is a

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source of funds to the Taliban but its corrupting influence is felt by the Afghan government itself. The Afghan authorities do not relish to focus on the issue. They are opposed to strong methods to control its production as it might alienate populations in the south-west. There is need for conversations between the Afghan government, regional countries and the European Union on how to control and eliminate the opium poppy from Afghanistan. That would be a major contribution to control civil conflict too. Europe is facing the flow of Afghan refugees. These are economic migrants but some among them are carriers of fundamentalist theologies. India is a destination of Afghans for medical, educational, trade among other purposes, and there are refugees too but not illegal ones in any troubling numbers. Finally, the return of peace and stability to Afghanistan will benefit the region and the world. It is of critical importance to India and Europe. The main hindrance to this endeavour is Pakistan. Europe must act in unison to influence Pakistan as in the case of the Financial Action Task Force (FATF) listing to act responsibly. However, Europe seems to again split with Russia adopting a different approach. There should be honest and intensive dialogue between India and Europe on the role of Pakistan in Afghanistan as has taken place recently between India and the United States. There is little doubt that despite its strong rhetoric, President Donald Trump’s Afghanistan and South Asia policy has proven to be no different from that of his predecessors. However, that does not seem to be an impediment to the United States giving up past inhibitions to seriously engage India on Afghanistan without fear that such conversations would annoy Pakistan. Indeed, Trump called for greater Indian economic involvement in Afghanistan. That is what the countries of Europe must also emulate. As of now, they have not chosen to do so, though China has now recognized India’s position and role in Afghanistan.

References Borrell, J. (2020, 19 February). Press Release on Phone Call of High Representative/Vice-President to President Ghani on the Results of the Presidential Elections. Dupree, L. (1973). Afghanistan. Princeton, NJ: Princeton University Press.

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Germany, Foreign Office. (2020, 9 March). Joint Statement by Special Envoys and Special Representatives of the EU, France, Germany, Italy, Norway, the United Kingdom, the United Nations and the United States of America on the occasion of the Signing of the U.S.-Taliban Agreement on February 29 in Qatar. Retrieved July 11, 2020, from https://www.auswaertiges-amt.de/en/ newsroom/news/us-taliban-agreement/2315872. India, Ministry of External Affairs. (2020, 20 February). Press Release. India Congratulates President Dr. Ashraf Ghani on his Re-election as President of Afghanistan. Retrieved July 10, 2020, from https://mea.gov.in/press-rel eases.htm?dtl/32406/india+congratulates+president+dr+ashraf+ghani+on+ his+reelection+as+president+of+afghanistan. Trump, D. (2017, 21 August). Remarks by President on the Strategy in Afghanistan and South Asia. Retrieved July 11, 2020, from https://www. whitehouse.gov/briefings-statements/remarks-president-trump-strategy-afg hanistan-south-asia/. United States, Department of State. (2020, 29 February). Agreement for Bringing Peace to Afghanistan between the Islamic Emirate of Afghanistan which is not recognized by the United States as a State and is known as the Taliban and the United States of America. Retrieved July 10, 2020, from https://www.state.gov/wp-content/uploads/2020/02/Agreem ent-For-Bringing-Peace-to-Afghanistan-02.29.20.pdf.

CHAPTER 12

India, Europe and Myanmar: Policy Approaches and Impact Rajiv Bhatia

Introduction As an underdeveloped Southeast Asian nation, Myanmar has drawn disproportionately high attention from the international community, especially due to its struggle for transition from military dictatorship to democracy, lasting over a generation. Its ceaseless–and still incomplete– endeavours at nation-building that encompass comprehensive reconciliation, peace and unity in an essentially pluralistic society, have also fascinated its neighbours, partners and friends. The epochal emergence and rise of Aung San Suu Kyi as a courageous fighter for human rights and democracy won her the Nobel Peace Prize for 1991. Her subsequent fall from the status of a respected international icon to a scorned politician, driven probably by a narrow partisan vision, has been a major subject of international interest. Her relative silence, lack of empathy and inaction on the Rohingya question have been given differing interpretations (Datta Ray 2018).

R. Bhatia (B) Former Ambassador to Myanmar, New Delhi, India © The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 R. K. Jain (ed.), India, Europe and Asia, https://doi.org/10.1007/978-981-33-4608-6_12

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Above all, the strategic importance of Myanmar, located in the IndoPacific region that itself has gained salience in the past five years, and the ascendency of China in Asia in general, particularly in the past decade, have imparted an inevitability to the inclusion of Myanmar in almost any narrative on the region’s geopolitics. In shaping and constantly tweaking its policy towards Myanmar, India has to factor in the role and policy approaches of other key players: China, the United States, Japan, neighbours in South Asia and the Association of Southeast Asian Nations (ASEAN). Viewed from outside Myanmar, the role of Europe/the European Union (EU) may not appear to be of great significance, but that perception changes when one looks at the diplomatic landscape closely, particularly on the basis of having lived, worked and travelled in Myanmar–as this author has done. Throughout the unfolding Myanmar story from 1988 when strongman Ne Win, who ruled the country since 1962, was overthrown as a result of the people’s action, till the present, Europe has taken considerable interest in the fluctuating fortunes of democracy, peace and development. The European Union has been a highly articulate and visible actor, although not as influential as others, viz. China, the United States, ASEAN and India, have been in recent years. Europe’s engagement has multiple dimensions, both at the regional platforms and bilaterally with Myanmar, which need to be studied and analysed, while keeping an eye on the other actors. Deeper appreciation of Europe’s role may only then be possible. The present seems to be an apt moment to evaluate the situation in Myanmar through the prism of the perspectives of India and the European Union. A gulf in mutual perceptions between India and EU should not cloud our judgement. The EU considers India as ‘an emerging global power’ (Kozlowski 2018) whereas Indian policy-makers have been focused far more on the relations with the United States and China rather than the Union. Europe is perceived as being bogged down with its internal problems and preoccupations. Recent developments however indicate some evidence of improved understanding and growing cooperation between India and the European side (Raja Mohan 2018). President Ram Nath Kovind recently observed: ‘Europe is irreplaceable in India’s determination to achieve the goals it has set for itself’ (Kovind 2018). This underlines the need for greater mutual understanding about what India and the EU seek in the ASEAN region in general and Myanmar in particular.

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This chapter aims to decipher the values and interests of both the European Union and India in Myanmar. It traces the evolution of their policies and highlights how both convergence and divergence marked both their perceptions and actions. It will also examine the European approach at several global and regional fora against the broad backdrop of India executing its shift from the Look East Policy (LEP) to the Act East Policy (AEP) from 2014 onwards. It concludes that a closer India-Europe dialogue on Myanmar, especially at the current stage of its development, could better serve the interests of all parties concerned.

Values, Interests, Perspectives Europe’s colonial connections with South Asia and Southeast Asia— with long periods of the British Raj in India, Singapore, Malaysia and elsewhere, the French rule in Indo-China and the Dutch reign in Indonesia—continued to colour perceptions and policies, some seven decades after colonialism began to crumble. The EU’s unflinching advocacy of human rights and democratic values may have received greater resonance and support, had Europe not had a colonial past with Asia. This is the reason why Europe’s push for ‘universal values’ comes into conflict with the argument about ‘Asian values’ that countries such as Singapore and Malaysia used to advance in the past. In Myanmar, the colonial angle had a special twist. Following the British triumph and commencement of the Raj in Burma in 1885, the latter was made a part of British India. It was governed from Calcutta and later Delhi during 1885–1937. Burma’s separation from India in 1937 and eventual impendence in 1948 impacted its journey as a free nation as well as its relations with the UK, Europe and India. As the twentieth century headed into its last decade, the prodemocracy movement led by a motely of student leaders, politicians and retired generals and later by Aung San Suu Kyi—the daughter of the leader of the freedom struggle—General Aung San—won widespread sympathy and support, both in Europe and India. In fact, 1988 marked ‘a turning point’ in EU-Myanmar relations (Egreteau 2010: 16). The movement however failed to dislodge the military from power. The Europeans continued to clamour for respecting the electoral verdict of 1990 (which brought a landslide victory for the National League for Democracy— NLD) and the restoration of democracy. Europe made ‘the Burmese issue a symbolic one for norms and values’ (du Rocher 2012: 177).

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Recognizing the hard reality, India made a careful assessment of Myanmar’s growing dependence on China in the early 1990s and consequently decided to adopt a ‘dual-track’ policy on Myanmar, of supporting democratic values and principles as well as sought to protect its own national interests in a pragmatic manner. It is not a simple story of a binary divide between Europe and India regarding values and interests. Emphasis on values has not prevented individual European countries—the UK, France and Germany—from pursuing their strategic, economic and other interests in Myanmar. India, on the other hand, made it amply clear that while its preference was for a democratic government, the choice rested with the people of Myanmar. While India was willing to share its experience and expertise as a democracy, it was unwilling to be an exporter of democracy. Indians, by and large, have been convinced of the basic logic of this position, but many Europeans remained unconvinced. What was logical to one side was perceived as hypocrisy by another. India was baffled that the European Union had difficulty in comprehending the adverse effects of the deepening engagement between China and Myanmar in military, economic and other domains throughout the 1990s and thereafter. European capitals showed little understanding of India’s compulsions relating to insurgency in the North East, which received both material and moral support from China and indirectly from Myanmar. A complex play of the above-mentioned diverse factors, thus, kept the European Union (and the United States) on one side of the fence while India and the ASEAN, stood on the other side of the diplomatic divide, cooperated to fashion and implement a strategy of ‘constructive engagement’ until 2010 with Myanmar’s generals. With the beginning of an intricate transition to partial democracy in March 2011—a process that reached a new milestone in April 2016 when the NLD and the military chose to share power after another impressive electoral victory by the former—the positions of India and the EU on Myanmar moved nearer to each other. Brussels now saw value in engaging the new government in Naypyitaw. But with change being the only constant, the EU’s position began to re-orient itself again, as a fullblown crisis emerged resulting in the mass expulsion of the Rohingyas from the Rakhine State to Bangladesh in August 2017. The subsequent sections trace the evolution and dynamics of the policy of India and the European Union towards Myanmar from the late 1980s till the present day.

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The European Union and Myanmar Three main phases characterize the evolution of the European Union’s policy towards Myanmar. The first phase focuses on Brussels’ attitude towards the military rule presided over by the State Law and Order Restoration Council (SLORC)/State Peace and Development Council (SPDC). In this phase, the Union’s policy was best defined in the ‘Common Position’ adopted by the European Council on 28 October 1996. At the outset, the document (European Council 1996) expressed disappointment over the unwillingness of SLORC to enter into a meaningful dialogue with the European Union. It expressed concern over the absence of progress towards democratisation and the continuing violation of human rights in Burma/Myanmar. It deplored the practice of torture, summary and arbitrary executions, forced labour, abuse of women and lack of democratic liberty. It called for immediate and unconditional release of all political prisoners and allowing NLD and other political parties to pursue their normal activities. Above all, it noted that the military regime was yet to move towards establishing a civilian democratic rule within a credible time-frame. The operative paras of the Council’s ‘Common Position’ listed the sanctions or restrictive measures that became the bedrock of EU policy towards Myanmar. They were divided into two categories. The first category consisted of sanctions already adopted in the past: a. Expulsion of all military personnel attached to the diplomatic representations of Burma/Myanmar in Member States of the European Union and withdrawal of all military personnel attached to diplomatic representations of the Member States of the European Union in Burma/Myanmar, and b. An embargo on arms, munitions and military equipment and suspension of non-humanitarian aid or development programmes. Exceptions may be made for projects and programmes in support of human rights and democracy as well as those concentrating on poverty alleviation and, in particular, the provision of basic needs for the poorest section of the population, in the context of decentralized cooperation through local civilian authorities and Non-Governmental Organisations; (European Council 1996 Paras 5 (a) (i) and (ii)).

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Additional measures that were adopted by the 1996 decision were: a. a ban on entry visas for senior members of the SLORC and their families; b. a ban on entry visas for senior members of the military or the security forces who formulate, implement or benefit from policies that impede Burma/Myanmar’s transition to democracy, and their families; and c. the suspension of high-level bilateral governmental (Ministers and Officials at the level of political director and above) visits to Burma/Myanmar. In December 1996, the EU resolved to suspend Myanmar’s trade privileges under the General System of Preferences (GSP) for industrial products. In April 1997, this measure was expanded when GSP benefits were withdrawn from agricultural products as well. In 1998, the scope of the visa ban was enlarged to include senior officials of SPDC who were barred from travelling to Europe. In subsequent years, further measures were taken to strengthen the visa ban, assets freeze, arms embargo, the suspension of all non-humanitarian aid and the withdrawal of EU’s military personnel from Myanmar (see Egreteau 2010). In a perceptive analysis, Jörn Dosch and Jatswan S. Sidhu observed: ‘There can be little doubt that the campaigns, censures, and sanctions pushed for by state and non-state actors in the EU, the United States and other like-minded actors such as Canada, did impact the Myanmar junta’ (Dosch and Sidhu 2015: 93). Interestingly, advocates of a ‘constructive engagement’ policy made similar claims. Which of the two approaches were therefor instrumental in bringing about change in Myanmar?1 To varying degrees, both approaches apparently contributed to persuading the military leadership to realize that its interests and those of the nation as well would be better served if they changed track and gradually introduced and increased the quotient of democracy. However, this decision in no way renounced the core political role of the military in the polity. This was the rationale of the 2008 constitution drafted by the military. This mindset led to a 1 ‘When all is said and done about Modi’s diplomatic record’, wrote C. Raja Mohan, ‘his outreach to Europe is likely to emerge as a major contribution to India’s foreign policy’ (Raja Mohan 2018).

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significant, though limited, change to the country between 2010 and 2020. The second phase was marked by the policy shift when the Thein Sein government was formed in March 2011 when the European Union’s policy underwent a notable shift between 2010 and 2013 in response to the changing political situation in Myanmar (see Bhatia 2016: 44–46). The 2010 elections brought Thein Sein, a retired general-turned civilian, to power on the back of a pro-military party—the Union Solidarity and Development Party (USDP). The Union reacted by extending a positive, though cautious, welcome to the election results. In 2012, the EU suspended sanctions and opened an office in Myanmar. In 2013, Brussels chose to lift all sanctions with the exception of the arms embargo. It restored trade preferences for Myanmar, which allowed duty-free and quota-free access to the EU market, under the Everything But Arms (EBA) scheme. A full-fledged office of the EU Delegation was opened in 2013. Between 2012 and 2013, Aung San Suu Kyi and President Thein Sein undertook two separate tours of European capitals, which helped to improve Europe’s relations with Myanmar. The European Union began to closely work with the Thein Sein government in several areas including assistance in the dialogue on ethnic reconciliation or the peace process; connecting with the military leadership for modernizing its mindset so that it could help the cause of democracy; and a gradual enlargement of development cooperation as well as enhancing trade and investment linkages with Myanmar. Europe was rather enthusiastic for the 2015 elections in which the NLD and other political parties participated. The elections in fact signified a clear sign of progress towards democratisation. The third phase in EU-Myanmar relations began in April 2016 which was marked by co-habitation between the NLD and the military in accordance with the constitutional provisions. This phase was initially positive (lasting until mid-2017) when the focus was on enhancing cooperation. Subsequently, however, it was transformed into a somewhat negative one as the Rohingya crisis unfolded. On 22 June 2016, the European Council outlined its vision of an ambitious and forward-looking engagement with Myanmar through a document entitled ‘Elements for an EU Strategy vis-à-vis Myanmar/Burma: A Special Partnership for Democracy, Peace and Prosperity’ (European Commission 2016). This strategy laid emphasis on six elements: (a) democracy, rule of law and good governance; (b) peace

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process; (c) human rights; (d) poverty reduction and sustainable development; (e) economic engagement; and (f) working together with Myanmar in ASEAN and the region. Its crucial take-away was: The EU should make full use of all the instruments at its disposal to address the remaining challenges of the transition process including statelessness, discrimination and human rights violations which, if ignored, could put progress in jeopardy. New areas of engagement include working directly with the government on reform and policy formulation through state building initiatives. (European Commission 2016: 15)

In the subsequent two years, the Council’s conclusions presented an altogether different story (European Council 2017). In October 2017, the Council decided to highlight the Union’s concern over the humanitarian and human rights situation in the Rakhine state, which was depicted as ‘extremely serious’. On the abuses that had led to the exodus of 500,000 people to Bangladesh, the EU candidly observed: ‘This is not acceptable and must end immediately.’ While the strategy outlined in the previous paragraph was reconfirmed, the EU began to place curbs on interaction with military officials and cautioned that ‘additional measures’ could be imposed. The Council’s conclusions of 26 February 2018 were even more critical (European Council 2018). The Council condemned ‘ongoing widespread systematic grave human rights violation committed by Myanmar/Burma military and security forces, including rape and killings’. It noted that over 680,000 people, mostly Rohingya, had fled their homes and sought refuge in Bangladesh. The Myanmar government was urged to create conditions for the ‘voluntary, safe and dignified return of displaced persons to the places of origin’. More importantly, the EU called for credible and independent investigations into alleged serious and systematic human rights violations’ and urged the Myanmar Government to cooperate with the Fact-Finding Mission of the Human Rights Council. Brussels’ essential idea was to increase diplomatic pressure on Naypyidaw while initiating steps to restrict cooperation programmes.2

2 For a useful discussion on the sanctions-oriented approach and the policy of constructive and pragmatic engagement, see du Rocher (2012). The author concludes that ‘brandishing vocal threats is not the most productive way to accomplish progress and promote Europe’s values’.

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The process of outreach by the EU to the Myanmar military suffered setbacks as a result of the latter’s action against the Rohingyas. On 26 April 2018, the European Council expanded the restrictive measures in place (i.e. the arms embargo) and adopted a framework for targeted measures against officials responsible for serious human rights violations. For example, on 25 June 2018, the EU designated seven senior military border guard and police officials responsible for or associated with atrocities against the Rohingya population. Soon media reports began to hint at the possibility that the EU could even consider withholding GSP privileges from Myanmar. (‘Myanmar may Lose EU Trade Privileges’ 2018). If this step were to happen, it would certainly adversely affect both the Myanmar economy as well as EU-Myanmar relations. ‘The potential revocation of trade privileges is just one of the many ways in which the Rakhine crisis could continue to impact Myanmar in the years to come—politically, economically and socially’ (Frontier Myanmar 2018). A monitoring mission of experts from the European Commission and the European External Action Service visited Myanmar towards the end of October 2018. An official press release indicated that the findings of this mission would feed into the analysis ‘on whether to remove these trade preferences through a temporary EBA withdrawal procedure’ (European Council 2018a). On 10 December 2018, the EU Council expressed ‘deep concern’ over the findings of an international fact-finding mission of the UN Human Rights Council as it concluded that gross human rights violations were committed by the Myanmar military in three states: Kachin, Rakhine and Shan. Subsequently, the EU Council decided, on 29 April 2019, to prolong the restrictive measures in place for another year, i.e. till 30 April 2020 (European Council 2019). Continuing the past trend, the Council decided on 23 April 2020 to extend the validity of restrictive measures against Myanmar till 30 April 2021 (European Council 2020).

India’s Myanmar Policy The trajectory of India’s Myanmar policy has had its share of zigzags, especially in the late 1980s and the 1990s, but its orientation and implementation in this century have been fairly steady and consistent. In contrast to the EU’s policy, India’s approach towards Myanmar has been motivated by great pragmatism, strategic and security considerations, and

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a deep awareness of the strong imperatives of the region’s changing geopolitics. The five-year period from late 1987 to mid-1992 witnessed an important transition in Myanmar’s recent political history. This included the departure of Ne Win, the arrival of an interim military regime, and the eventual emergence of Than Shwe as the strong leader who would guide the nation’s destiny until 2010. Burma’s journey through this transition triggered immense concern in India, as indeed elsewhere. The suppression of the people’s movement by the Army was widely condemned. Following a bold policy, New Delhi repeatedly called for respecting the people’s will, particularly the outcome of 1990 elections, and for the restoration of democracy as well as the release of Aung San Suu Kyi and other political prisoners. Not content only with extending diplomatic and political support, India provided medical assistance to Burmese students injured during the military crackdown. It also gave shelter to a sizeable number of Burmese refugees and used the broadcasts of the All India Radio (AIR) to expose the ugly face of military rule. In this context, Thant Myint-U noted: In the years immediately following the failed 1988 uprising in Burma, the Indian government took ‘a very hard-line position against the Burmese military government, perhaps the hardest line anywhere in the world’ (Myint-U 2012: 268). The reaction of the SLORC government to all these measures was expectedly negative. As a result, India-Burma relations reached a real low point. In the early 1990s, a policy review by New Delhi became necessary. The insurgency in the Northeast assumed a serious dimension with Indian Insurgent Groups (IIGs) receiving considerable assistance from and shelter in Myanmar. The international ostracization of Burma had speeded up the nation’s slide into China’s embrace. Besides, P.V. Narasimha Rao, India’s Prime Minister since 1991, was in the process of conceptualising and launching a new outreach towards ASEAN, later known as the Look East Policy in which Myanmar would have a critical role to play. A mix of these considerations led to the adoption of ‘a two-track policy’. This involved the continuation of moral and political support to the pro-democracy forces and leaders as well as engagement with the military government in order to improve and strengthen relations at the government level. ‘It was a calibrated and complex initiative to balance principles, values, interests and geopolitical realities’ (Bhatia

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2016: 102). In the mid-to-late 1990s, policy execution faced pressures and counter-pressures. Consequently, the Indian Government gave an impression, at times, that it was unsure as to where its priorities lay. Once the National Democratic Alliance (NDA) government led by Prime Minister Atal Bihari Vajpayee took over in 1998, India’s Myanmar policy assumed a new vitality and consistency. Its essential focus now was on expanding cooperation with Myanmar in infrastructure connectivity as well as in the security and defence domain. This policy line was subsequently followed (and expanded) by the United Progressive Alliance (UPA) government led by Prime Minister Manmohan Singh. In October 2004, he hosted Senior General Than Shwe, the first visit by the topmost Myanmar leader in a quarter century. Since 2014, the Modi government built further on these foundations. Thus, between 1998 and 2020, i.e. in a period of over two decades, India-Myanmar relations scaled several new heights. However, it was still difficult to argue that bilateral cooperation had reached an optimal level, mainly because of the continuing delays in completing two flagship projects, namely the Trilateral Highway and Kaladan Multi-modal Transport project. Nevertheless, New Delhi ensured that the relationship remained largely insulated from the adverse effects of the Rohingya crisis. India took a holistic and balanced view, believing that all facets—terrorism, refugees’ trials and travails, humanitarian dimension, political aspects of the issue and the perspective of Bangladesh—needed to be addressed in a constructive manner. India’s policy towards Myanmar was shaped by the imperatives of India being fair and helpful to Bangladesh, a close and friendly neighbour, and the strategic compulsions to avoid increasing Myanmar’s dependence on China.

A Comparison of Two Relationships EU-Myanmar relations, as apparent from the foregoing narrative, have been moulded by an array of political considerations, particularly the human rights agenda of the European Union and its consistent goal to be a partner of Myanmar in the latter’s transition to democracy. The EU provides strong support for democratisation, economic reforms and peacebuilding in the country. It also conducts a human rights dialogue with the Myanmar authorities, which came under much stress in the wake of the Rohingya crisis.

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Political issues are also addressed at multilateral fora, ranging from the United Nations and the Human Rights Council to the ASEAN,3 the ASEAN Regional Forum (ARF) and the Asia-Europe Meeting (ASEM). For example, the ASEM summit, held in Brussels on 18–19 October 2018, seized the opportunity to deliberate on issues relating to Myanmar and Bangladesh. The Chair’s statement stressed the importance of finding ‘a comprehensive and durable solution to address the root cause of the conflict in Rakhine State and commended Bangladesh for sheltering displaced persons’ (European Council 2018a). While avoiding a direct criticism of the Myanmar government, it raised the issue of ‘accountability’ and pointed to the need to establish conducive conditions for ‘the safe, voluntary, dignified, and sustainable return and reintegration of displaced persons to Rakhine State’ (European Council 2018a). Beyond political issues, there are at least three other important facets of this relationship. Firstly, development cooperation has been steadily expanding. Myanmar benefits from an indicative allocation of e688 million under the Multi-Annual Indicative Programme for 2014–2020. This assistance is utilized for four sectors: rural development, agriculture, food and nutrition security; education; governance, rule of law and state capacity building; and peacebuilding support. Some of the EU-supported flagship projects are LIFT (Livelihoods and Food Security Trust Fund), ‘STEP Democracy’, ‘My Justice’, ‘Joint Peace Fund’, and ‘SMART Myanmar’ (see European External Action Service 2018 for more details). Secondly, the EU has been an important source of humanitarian aid. In May 2018, Brussels released a sum of e40 million to provide lifesaving support, sanitation and healthcare to the Rohingya refugees in Bangladesh. This was in addition to e51 million mobilized by the European Commission in 2017. The Union also provides humanitarian aid to displaced people in Kachin and northern Shan State as well as assistance for disaster risk management. Thirdly, bilateral trade and economic cooperation represents a dimension of growing importance. Bilateral trade grew to e2 billion in 2017

3 Please refer to an astute examination of ASEAN’s perception of the EU’s approach towards Myanmar and the related international-regional relations by Kerstin Schembera who argued that ‘differing membership concepts implied differing ideas about the role of sanctions and human rights in the Myanmar case’ (Schemebera 2016: 1039).

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from e404 million in 2012. With the restoration of GSP benefits, Myanmar’s exports have rapidly increased. The EU also became the fourth largest foreign investor in 2017, with the value of total existing investments in Myanmar reaching e5.5 billion. An investment protection agreement has been under negotiation, but the pace of discussions has been slowed down by developments relating to the Rohingya question. Business-to-business ties are active: the Eurochamber has been serving as a significant bridge. Myanmar has been selected as a case study country for European economic diplomacy. India-Myanmar relations, in contrast, are managed on the premise that each country is committed to refraining from interference in each other’s internal affairs. As a result, the effort has been to insulate the bilateral relationship from sensitive issues such as the violations of human rights, labour standards, constitutional reforms and ethnic reconciliation process. India is happy to share with Myanmar the knowledge and experience of a large democratic governance set-up in a pluralist society that is advancing rapidly on the path of inclusive development. However, it prefers to fashion its bilateral partnership with Myanmar in a manner that ensures the latter’s comfort level. Political cooperation revolves around Myanmar’s unstinting support for India’s LEP/AEP and India’s appreciation of the progress achieved by Myanmar in the domain of democratic and economic reforms. Indian leaders constantly stress the critical role of Myanmar in the implementation of the LEP/AEP and the mutual need for greater connectivity and cooperation between India’s Northeast region and the western region of Myanmar. During Prime Minister Narendra Modi’s visit to Myanmar in September 2017, both governments pledged to ‘maintain the alreadyachieved mutual understanding and growing bilateral relations between the two countries’ and to ‘stand by each other as good and trustworthy neighbours’ in the years ahead in the interest of both peoples and the region (India, Ministry of External Affairs 2017). On the Rohingya question, New Delhi matches its generous material assistance for refugees with diplomatic resilience which seeks to encourage and promote a lasting

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solution through direct discussions between Bangladesh and Myanmar4 (Bhatia 2017). Promising developments pertaining to bilateral relations were reported, especially on the conclusion of President U Win Myint’s visit to India in February 2019. The two sides noted ‘the momentum’ that had been added to the relationship as a result of ‘regular high level interaction’. They ‘welcomed the synergy’ between the two countries’ external policies and committed themselves ‘to further strengthen (their) partnership’ (India, Ministry of External Affairs 2020a). A total of 10 MoUs were signed (India, Ministry of External Affairs 2020b). This was a clear indication of the positive direction taken by the bilateral relationship. Prime Minister Modi had a telephonic discussion with State Counsellor Daw Aung San Suu Ky on 30 April 2020 on the COVID-19 catastrophe when the former offered to extend all possible assistance needed by Myanmar (India, Ministry of External Affairs 2020c). Development cooperation figures prominently in India’s overall cooperation with Myanmar. This cooperation encompasses major infrastructure connectivity projects as well as a number of significant initiatives to set up long-term, sustainable and relevant institutions for capacity building and human resource development in diverse areas. Grant-inaid assistance amounting to US$1.75 billion has been committed. Over the years, considerable concessional finance has also been made available for projects ranging from transport and communications to agriculture and farm mechanization, and highway development. Indian partnership in development cooperation in Myanmar is ‘tailored firmly to Myanmar’s national priorities’, wrote Indian Ambassador Vikram Misri in Yangon in July 2018 (Misri 2018: 38–39). Trade and investment cooperation too are significant, showing much potential for the future. In 2016–2017, bilateral trade was valued at US $2.17 billion. Trade was evenly balanced, as Indian exports amounted to US $1.11 billion and Indian imports reached US $1.06 billion. However, bilateral trade showed considerable decline to $1.7 billion in 2018–2019.

4 The author pinpointed the vital elements in the Indian position: ‘On the Rohingya

issue, India took a principled and pragmatic position, extending generous human assistance to both sides (probably more than any other country), urging them to resolve the issue through dialogue, supporting the Kofi Annan Commission recommendations, and conveying readiness to contribute to the long-term economic development of the Rakhine region’ (Bhatia 2017).

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India is the eleventh largest foreign investment partner, with an approved investment of US $772 million by 34 Indian companies, as of March 2020. Most of India’s investments have been in the oil and gas sector. Cooperation in other fields, namely disaster relief, security and defence, culture, education, training and people-to-people ties have been on a growth path (For details, see Ministry of External Affairs, May 2020). In brief, both countries continue to nurture their multi-faceted relationship, backed by political will.

Myanmar Today: Key Stakes and a Suggestion From the shared perspective of EU and India, there are four major issues relating to Myanmar today, which cause widespread anxiety and require deep reflection. Firstly, nation-building will remain incomplete until diverse ethnic groups attain ample autonomy within the framework of a united and federal Myanmar run by a strong central government, which is insisted upon by the majority Burman community.5 Secondly, the gap between the two sides (i.e. the government and ethnic groups) seems unfortunately unbridgeable at present. Differences are further accentuated by the long history of conflict, the rigidity of the military leadership, and China’s deep game in the peace process. Nevertheless, the government perseveres with endeavours to promote an acceptable framework for ethnic reconciliation and peacebuilding. Will the next elections due in 2020 act as an incentive for a breakthrough? Thirdly, Myanmar will remain a partial democracy until a way is devised to end the military’s political role by amending the constitution. The military is unwilling to accept moving in that direction for the present. The Rohingya question defies solution not because of any serious technical differences between Bangladesh and Myanmar governments over the return of refugees to the Rakhine state. The problem is more fundamental: the Buddhist majority community in that state and the larger Burman-Buddhist community in the country, (which dominates the military, the ruling party NLD and perhaps the thinking of Aung San Suu 5 The Burman or Bamar community is about 68% of the total population, whereas the other diverse ethnic groups account for the remaining 32%. The bulk of Bamars live in Lower and Upper Burma, while most minority ethnic people live in the horseshoe region of hills and border areas. Thus, segregation forms a general pattern.

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Kyi) are all determined not to treat the Rohingyas as an ethnic group of Myanmar. ‘Faced with pressure and mounting calls for accountability, Myanmar has mounted a defence of denial and defiance’ (Mahtani 2018). Myanmar officials insist that the Rohingya people are excluded from citizenship rights. The challenge therefore is how to change this mindset and ensure that the nation gradually adapts itself to the demands and expectations of the international community. Fourthly, China’s growing strategic footprint across the entire political, economic and social spectrum in the age of ‘Belt and Road Initiative’, at a time when Myanmar has once again fallen off the radar of the US Administration, is a cause of serious concern to New Delhi and other nations—and it should also be so to the European Union as well. What needs to be done about this challenge should be a legitimate concern for both India and the EU, bound together by a strategic partnership. Discerning observers of Myanmar would argue that the above set of four fundamental issues cannot be discussed and resolved at the government level alone. Instead, Myanmar’s select scholars as well as European and Indian experts on Myanmar affairs need to sit together, with the involvement of officials concerned, in order to hold a sustained 1.5 Track Dialogue. Its aim would be to examine the given realities and complexities and come up with a crop of fresh ideas and practical plans, which enable Myanmar to tackle its pressing twenty-first-century challenges. Without an astute mix of new thinking, pragmatism and resilience, and political boldness and re-education of public opinion, Myanmar will continue to march on the path of disappointment and unfulfilled potential.

References Bhatia, R. (2016). India-Myanmar Relations: Changing Contours. New Delhi: Routledge. Bhatia, R. (2017, November 30). Diplomatic Dimensions of Rohingya Crisis. Gateway House. Retrieved October 22, 2018, from https://www.gatewayho use.in/diplomacy-of-rohingya-crisis/. Datta Ray, S. K. (2018, October 9). Why ‘Pragmatic’ Suu Kyi is Silent on Rohingyas. Asian Age. Retrieved October 22, 2018, from http://www.asi anage.com/opinion/oped/091018/why-pragmatic-suu-kyi-is-silent-on-roh ingyas.html. Dosch, J., & Sidhu, J. S. (2015). The European Union’s Myanmar Policy: Focus or Directionless? Journal of Current Southeast Asian Affairs, 34(2), 85–112.

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Du Rocher, S. B. (2012). The European Union, Burma/Myanmar and ASEAN: A Challenge to European Norms and Values or a New Opportunity? Asia Europe Journal, 10(2–3), 165–180. Egreteau, R. (2010). Intra-European Bargaining and the ‘Tower of Babel’ EU Approach to the Burmese Conundrum. East Asia, 27 (1), 15–33. European Commission. (2016). Joint Communication to the European Parliament and the Council. Elements for an EU Strategy vis-à-vis Myanmar/Burma: A Special Partnership for Democracy, Peace and Prosperity. JOIN(2016) 24 fnl, 1 June, Retrieved October 22, 2018, from https://cdn4-eeas.fpfis. tech.ec.europa.eu/cdn/farfuture/uDPrYBY5mGNYBpTZqqf2Bbfo0ZRIQF J5Ypp-XeGML9Y/mtime:1476180814/sites/eeas/files/join_2016_24_f1_ communication_from_commission_to_inst_en_v5_p1_849592.pdf. European Council. (1996, October 28). ‘Common Position on Burma/Myanmar’ Defined by the Council on the Basis of Article J.2 of the Treaty of the European Union. Retrieved October 22, 2018 from https://eur-lex.europa.eu/LexUri Serv/LexUriServ.do?uri=CELEX:31996E0635:EN:HTML. European Council. (2017, October 16). Myanmar/Burma Conclusions. Retrieved from October 22, 2018, from https://www.consilium.europa.eu/ en/press/press-releases/2017/10/16/myanmar-burma-conclusions/. European Council. (2018a, February 26). Myanmar/Burma: Council Conclusions. Retrieved October 22, 2018, from http://data.consilium.europa.eu/ doc/document/ST-6418-2018-INIT/en/pdf. European Council. (2018b, October 19). Asia-Europe Meeting, ASEM 12 ‘Global Partners for Global Challenges’, Chair’s Statement. Retrieved October 22 2018, from https://www.consilium.europa.eu/media/36803/asem12-chairstatement.pdf. European Council. (2019, April 29). Myanmar/Burma: Council Prolongs Sanctions. Retrieved April 20, 2020, from https://www.consilium.europa.eu/en/ press/press-releases/2019/04/29/myanmar-burma-council-prolongs-sancti ons/. European Council. (2020, May 18). Declaration by the High Representative on behalf of the EU on the Alignment of Certain Countries concerning Restrictive Measures against Myanmar/Burma. Retrieved June 5, 2020, from https:// www.consilium.europa.eu/en/press/press-releases/2020/05/18/declar ation-by-the-high-representative-on-behalf-of-the-eu-on-the-alignment-of-cer tain-countries-concerning-restrictive-measures-against-myanmar-burma/. European External Action Service. (2018, June 25). EU-Myanmar Relations. Retrieved November 15, 2018, from https://eeas.europa.eu/headquarters/ headquarters-homepage_en/4004/EU-Myanmar%20relations. Frontier Myanmar. (2018, October 11). Everything but Common Sense. Editorial, Retrieved October 22, 2018, from https://frontiermyanmar.net/en/everyt hing-but-common-sense.

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India, Ministry of External Affairs. (2017, August). India-Myanmar Relations. Retrieved October 23, 2018, from http://www.mea.gov.in/Portal/Foreig nRelation/MYANMAR_August_2017_new.pdf. India, Ministry of External Affairs. (2017, September 6). India-Myanmar Joint Statement. Retrieved October 22, 2018, from https://www.mea.gov.in/bil ateral-documents.htm?dtl/28924/IndiaMyanmar_Joint_Statement_issued_ on_the_occasion_of_the_State_Visit_of_Prime_Minister_of_India_to_Mya nmar_September_57_2017. India, Ministry of External Affairs. (2020a, February 27). India-Myanmar Joint Statement during the State Visit of the President of Myanmar to India, 26–29 February 2020. Retrieved June 4, 2020, from https://www.mea.gov. in/bilateral-documents.htm?dtl/32435/IndiaMyanmar_Joint_Statement_ during_the_State_Visit_of_the_President_of_Myanmar_to_India_February_2 629_2020. India, Ministry of External Affairs. (2020b, February 27). MoUs Exchanged during the State Visit of President of Myanmar. Retrieved June 4, 2020, from: https://www.mea.gov.in/bilateral-documents.htm?dtl/32433/ MoUs_Exchanged_during_the_State_Visit_of_President_of_Myanmar). India, Ministry of External Affairs. (2020c, April 30). Telephone Conversation between Prime Minister and State Counsellor of Myanmar Daw Aung San Suu Kyi. Retrieved June 4, 2020, from https://www.mea.gov.in/press-releases. htm?dtl/32664/Telephone_conversation_between_Prime_Minister_and_ State_Counsellor_of_Myanmar_Daw_Aung_San_Suu_Kyi). Kovind, R. N. (2018, June 19). Address at the Hellenic Foundation for European and Foreign Policy, Athens. Retrieved October 22, 2018, from https://presid entofindia.nic.in/speeches-detail.htm?531. Kozlowski, T. (2018, October 9). Remarks made by EU Ambassador to India at a book launch event at Sapru House, New Delhi. Mahtani, S. (2018, October 9). The World Decries Myanmar’s Rohingya Abuses. Myanmar’s Reply: Denial, Defiance and Propaganda. Washington Post. Retrieved November 15, 2018, from https://www.washingtonpost. com/world/asia_pacific/the-world-decries-myanmars-rohingya-abuses-mya nmars-reply-denial-defiance-and-propaganda/2018/10/09/49d11916-c1b911e8-9451-e878f96be19b_story.html. Misri, V. (2018). India’s Cooperation Efforts in Myanmar. Development Cooperation Review, 1(4), July, 38–39. ‘Myanmar may Lose EU Trade Privileges’. (2018, October 6). Retrieved October 23, 2018, from: http://www.mizzima.com/business-international/myanmarmay-lose-eu-trade-privileges. Raja Mohan, C. (2018, October 13). Reconnecting with Europe. The Indian Express. Retrieved November 12, 2018, from: https://carnegieindia.org/ 2018/09/11/raja-mandala-reconnecting-with-europe-pub-77223.

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Schembera, K. (2016). The Rocky Road of Interregionalism: EU Sanctions against Human Rights-Violating Myanmar and Repercussions on ASEAN-EU Relations. Cambridge Review of International Affairs, 29(3), 1022–1043. Thant Myint-U, T. (2012). Where China Meets India: Burma and the New Crossroads of Asia. New York: Farrar, Straus, Giroux.

Index

0–9 5G, 9 16+1, 8, 55, 61, 65, 144 17+1, 8, 55, 62, 144 9/11, 116, 246–247, 253 A Abbas, Mahmoud, 202 Abdalis, 263 Abdullah, Abdullah, 271, 273–274 Abdullah, King, 198 Abu Dhabi, 176 Act East policy, 25, 124, 281, 291 Afghanistan, 6, 12, 24, 138n2, 139, 141, 194–195, 214, 226–228, 231, 246, 261–262, 268–269 and Pakistan role, 275 and Trump, 272 and UK, 263–264 as buffer, 262–265 as Cold War arena, 265–268 as post-conflict laboratory, 261, 270–272 as terrorist centre, 262, 268–269

as transit point, 262 Communist Party, 266 divergent European-Indian approaches, 272–273 Election Commission, 273 European casualties, 271 National Unity Government, 271–272 opium, 275 Soviet withdrawal, 268 US-Taliban agreement, 273–274 and India, 273 and Europe, 273 US troops, withdrawal, 271, 273 Western development assistance, 275 Africa, 13–15, 136, 138–139, 163–164, 253, 266 African Union, 204 Afrin, 203 Agnelli, Susanana, 106 Ahmedinejad, Mahmud, 212 Airbus, 213 Al Assiri, General Ahmed, 196

© The Editor(s) (if applicable) and The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd. 2021 R. K. Jain (ed.), India, Europe and Asia, https://doi.org/10.1007/978-981-33-4608-6

299

300

INDEX

Al Died airbase, 196 Al Minhad airbase, 189 Al-Qaeda, 199, 241, 246, 269–270 al-Asad, Bashar, 229 Alaska, 263 Alderman, Liz, 197 Alexander the Great, 262 Algeria, 204 All India Radio, 288 America First, 166 Amin, Hafizullah, 266 Amu Darya, 263, 267 Andaman and Nicobar, 178 Anglo-Afghan war, Third (1919), 264 Anglosphere, 10 Ansari, Hamid, 121, 123 anti-access/area denial (A2/AD), 162, 176 Arab Spring, 193, 206 Arak, 212 Area of Responsibility (AOR), 166 Argentina, 141 Article 370, 249, 253 artificial intelligence, 142 ASEAN, 9, 23–24, 30, 32, 34–35, 86, 101–103, 107–109, 113, 114n5, 140, 147, 150, 166–167, 169, 172, 280, 288, 290 and EU, 24 Catalytic Green Finance Facility, 147 centrality, 28, 115 ICT Master Plan 2020, 25 Initiative for ASEAN Integration Work Plan III, 25 Master Plan for Connectivity 2025, 25 Secretariat, 31, 113–114, 124 Treaty of Amity and Cooperation, 27 ASEAN 2025—Forging Ahead Together, 25

ASEAN-EU development aid, 28 Enhanced Partnership Plan of Action (2018–2022), 27–28 ASEAN-India, 25–26 FTA, 26 Partnership for Peace, Progress and Shared Prosperity (2016–2020), 166 ASEAN Defence Ministers’ Meeting Plus (ADMM-Plus), 28–29, 33, 172 ASEAN East-West Corridor, 26 ASEAN Regional Forum, 2, 23–25, 33, 116, 137, 150, 290 and EU, 24, 27–29 Ashton, Catherine, 248 Asia, 85, 193, 266–267 connectivity, 32–33 definition of, 106 security cooperation, 33 share of world GDP, 86 Asia-Africa Growth Corridor (AAGC), 136, 139, 148, 150 Asia-Europe Cooperation Framework, 110 Asia Europe Foundation, 111, 119 Asia Europe Foundation Journalists Colloquium (2013), 119 Asia Europe Meeting (ASEM), 31–32, 122–123, 147, 150, 172, 290 and connectivity, 121 and Indian membership, 107–114 and Indian perceptions of, 119–121 birth of, 102–104 exclusion, politics of, 106–107 importance of, 121–124 inaugural summit, 104–106 Indian engagement, 117–119, 124–125 membership, 124 Asia-Pacific, 22, 47, 85, 117

INDEX

Asia-Pacific Economic Cooperation (APEC), 106, 110, 123 Asia Reassurance Initiative Act (ARIA), 40 Asian Development Bank (ADB), 37, 40, 147 Asian financial crisis, 115 Asian Highway Network, 138, 138n2 Asian Infrastructure and Investment Bank (AIIB), 60, 142, 144, 147 Asian Relations Conference (1947), 137 ATALANTA, 22 Atlantic alliance, 2, 15 Aung San Suu Kyi, 279, 281, 288, 293–294 Aung San, General, 281 Australia, 31, 36, 41, 83, 103–105, 108–111, 144, 148, 161–162, 166, 171–174, 177–179 Austria, 144 Azhar, Masood, 143 B Bab-al Mandeb Strait, 191 Babylon, 262 Badawi, A.A., 106, 109 BAE, 197 Bahrain, 173, 188, 192–193, 195 Balkans, 61 Baluchistan, 221 Bangladesh, 31, 35, 38, 138, 138n2, 164, 286, 289, 290n3 Bangladesh, Bhutan, India and Nepal (BBIN), 38–39, 138 Bangladesh-China-India-Myanmar (BCIM), 136, 141 Barroso, Jose Manuel, 7 Basque, 241 Bay of Bengal, 34, 38 Bay of Bengal Initiative for MultiSectoral Technical and Economic

301

Cooperation (BIMSTEC), 38–39, 136, 138, 150 Beijing Consensus, 63 Belgium, 14, 51, 122, 143–144, 219, 244 Belt and Road Initiative (BRI), 7–9, 14, 32, 133, 136, 141–142, 145, 147, 150, 164 1st Forum (2016), 61 2nd Forum (2019), 143, 150 and China, 61–62 and EU, 143–145 and India, 61–62, 140–143 Bharatiya Janata Party, 249–250 Benelux, 254 Bhutan, 138 Bhutto, Zulfiqar Ali, 266 bilateral investment treaties, 83–84 bin Laden, Osama, 269 Black Sea, 146 Blackstone, 197 Borrell, Josep, 15, 64n12, 65–66, 218, 252 Brazil, 10 Brexit, 7, 10, 13–14, 134, 148 and India, 13–14 BRICs (Brazil, Russia, India, China and South Africa), 200 British-Afghan wars, 264 Brunei, 31, 113, 116, 163, 173 Brunei Plan of Action (2013–2017), 24 BUILD (Better Utilization of Investment Leading to Development) Act, 40 Bulgaria, 113–114, 122, 138n2 Burma, see Myanmar Bush, George W., 220, 226 C California, 263 Cambodia, 26, 31, 38, 109, 113, 139

302

INDEX

Cambodia, Myanmar, Laos and Vietnam (CMLV) countries, 26 Cameron, David, 174 Canada, 83, 143, 284 Caspian Sea, 139, 146, 203 Catalonia, 241 Caucasus, 146 CENTCOM, 196 Central Asia, 2, 12, 138–139, 141, 146, 164, 191, 194, 202, 214, 253, 264, 267, 269 Central Asia Regional Economic Cooperation (CAREC), 136 Central Europe, 8–9, 46, 55–56, 61–62, 144, 164 Chabahar, 138–139, 150, 191, 195, 215, 228 Chabahar–Zahedan railway line, 195 Chad, 205–206 Chaisse, J., 84 Chandragupta Maurya, 262 Charles de Gaulle, 173 Chatham House, 174 Chechen terrorists, 269 Chile, 83 China Ocean Mineral Resources R&D Association (COMRA), 165 China, 1–2, 6, 12, 21, 30–31, 37, 40, 45, 49, 67, 81, 86, 91, 103–104, 112–113, 124, 134, 138n2, 139–141, 143, 146, 150–151, 161, 163–164, 170, 173–174, 195, 197–198, 207, 213, 238, 241, 251, 276, 280 accession to WTO, 54 and Africa, 139 and Central Europe, 9, 61–62 and COVID-19, 65 and EU, 145 and EU values, 5 and European integration, 47 and Eurozone crisis, 64

and Indian UNSC membership, 202 and Indo-Pacific, 160–163 and West Asia, 192 China-centric world order, 62–63 FDI in EU, 55 image in Europe, 60–61 Made in China 2025, 55 normative challenger, 62 peaceful rise, 47 population, 89 predatory economics, 61 socialism with Chinese characteristics, 54 standoff with India at LAC, 66 systemic rival, 64, 64n12, 65–66 White Paper on Military Strategy (2015), 33 China–Central Asia–West Asia Economic Corridor, 141 China–Pakistan Economic Corridor (CPEC), 61, 67, 141–142 Chindia, 64 climate change, 15, 52, 135 Cocos Keeling, 178 Cold War, 2–4, 22, 47, 134, 137, 170, 212, 214, 253, 262, 266, 268 Columbia, 83, 142 Common Market for East and Southern Africa, 136 Commonwealth Games, 48, 123 Commonwealth of Nations, 10 Comprehensive Convention on International Terrorism, 199 Comprehensive Test Ban Treaty, 115 Conference on Interaction and Confidence-Building in Asia (CICA), 137 conflict resolution, 12 connectivity, 26, 65 and geo-economics, 134–136

INDEX

and India, 137–140 and Indo-European cooperation, scope for, 148–150 EU Strategy connecting Europe and Asia, 145–148 Cooper, Robert, 2, 253 Copenhagen, 239–240 COSCO Shipping, 56, 144 COVID-19 pandemic, 46, 64, 65, 65n13, 141–142, 150, 163, 218–219, 251, 292 Crimea, 7 Critical Maritime Routes Programme (CMR), 170 Croatia, 55 cross-border terrorism, 240 cyber security, 147 Czech Republic, 9, 56, 62, 142

D Daesh, 200 Daimler-Benz, 213 Dainik Jagran, 119 Darfur, 6 Daw Aung San Suu Ky, 292 Dawei port, 38 de Estrada, Kate Sullivan, 168 de La Merced, Michael J., 197 debt trap diplomacy, 143 Declaration of the Conduct of the Parties in South China Sea (DOC), 36 Delaram-Zaranj road, 226 Denmark, 23, 219, 239–240, 271 Diego Garcia, 165, 173 Digital Silk Road, 142 Djerba, 206 Djibouti, 34, 171, 176, 191–192, 194 Doha Round, 82 Dombrovskis, Valdis, 29 Dosch, Jörn, 284

303

Dunning, J., 77–78, 90 Dupree, Louis, 262–263 Duqm port, 189 Durand, Mortimer, 264 E E3/EU+3, 215, 217 East Africa, 161, 193 East Asia, 58, 105, 106, 111, 115–117, 122–123, 134 East Asia Summit (EAS), 25, 28–29, 33, 35, 39, 137, 166 East China Sea, 22, 166, 169 East Coast Rail Link, 141 Eastern Europe, 8, 46, 55, 61–62, 144, 146, 164 East–West Economic Corridor, 40 Edinburgh Declaration, 212 EFIC, 41 Egypt, 190–191, 193, 195, 206 Elles, James, 243 Erdogan, Recep Tayyip, 202 Estonia, 122 EU-Asia–Pacific Forum on Financial Regulation (2017), 29–30 EU-China Connectivity Platform, 145 EU-Japan Economic Partnership Agreement, 88 EU-Japan Partnership on Sustainable Connectivity and Quality Infrastructure, 147 Eurasia, 61, 138–139, 141–142, 146, 149, 164 Eurasia Land Bridge, the TransHimalayan Economic Corridor, 141 Eurasian Economic Union (EEAU), 146 Eurochamber, 290 Europe, 55, 163–164, 179, 207, 252, 272 and BRI, 143

304

INDEX

Indian diaspora, 11 interest in West Asia, 193 Europe-Asia China fantasy, 4–10 structural problems, 2–4 Europe–Asia Forum (Manila, 1998), 111 Europe-Asia Forum on Culture, Values and Technology (Venice, 1996), 103, 111 European Chamber of Commerce in China, 8 European Commission, 7–8, 14, 22, 45, 48, 52, 65–66, 89, 94, 106, 110, 112, 124, 169, 237–240 European Council of Foreign Affairs, 6 European Economic Community, 45, 49 European External Action Service, 7–8, 287 European Fund for Sustainable Development (EFSD), 149 European Investment Bank (EIB), 38 European Parliament, 1, 14, 27–28, 49–50, 108, 110, 116, 229, 243 All-Party Group on Kashmir, 243 and human rights in Kashmir, 243–246 Delegation for Relations with China, 50 India Delegation, 49 European Security Strategy (2003), 22 European Union, 1, 22, 39, 45, 95, 115, 124, 144, 151, 162, 164, 168, 170, 190, 194n1, 195, 197, 201–202, 204, 211–212, 214–215, 217–218, 230, 247– 249, 251–253, 256, 276, 280, 284–285, 294 and Africa, 14 and ASEAN, 27–29

and Asia-Pacific financial dialogue, 29–30 and BRI, 144–145 and East Asia Summit, 29 and India-China standoff at LAC, 66 and Indo-Pacific, 22 and Kashmir, 12 and Libya, 204–206 and migration, 203–204 and Myanmar development assistance, 290 trade, 291 and rise of China, 33–34 and SAARC, 37–38 and security cooperation in Asia, 33 and Turkey, 203 and West Asia, 193 Asia strategy, 1994, 22 Asia strategy, 2001, 22, 112 civilian power strategy, 54 Common Commercial Policy, 84 Common Foreign and Security Policy, 242 connectivity strategy, 14 Council, 8, 27, 56, 110, 203, 214, 237, 240, 286 differential treatment of China and India, 47–49 Directorate General for Trade, 32 foreign policy priorities, 11 Global Strategy 2016, 146 guidelines on the EU’s foreign and security policy in East Asia (2012), 22 High-Level Dialogue on Maritime Cooperation with ASEAN, 28 investment policies, 82–85 investment screening mechanism, 9 investments in Asia, 85–88 Joint Communication, ‘The EU and ASEAN: A Partnership

INDEX

with Orientation Courses’ on the EU Common Security and Defence Policy, 28 statement on human rights in China, 2017, 56 Strategy for Syria, 200 Strategy on Connecting Europe and Asia (2018), 134, 145–149, 172, 228 Strategy on India (2018), 148 trade with Iran, 194 European Union-ASEAN FDI, 30 FTA, 31–32 Plan of Action (2018–2022), 23 trade, 30 European Union-China, 12, 15, 50, 50n3 and BRI, 7–8 and Indian media and elite perceptions, 58–60 civilian power strategy, 54 growing political and economic links, 55–56 human rights, 5–8 investment screening mechanism, 9 mirage of socializing China, 53–54 potential threat, 57–58 predatory investment, 54 security implications, 58 strategic partnership, 50–52 trade, 58 trade deficit, 5–6, 57 visits, 52n7 European Union-Iran, 211–212, 217–218 Common Position (1996), 283 Elements for an EU Strategy vis-à-vis Myanmar/Burma (2016), 285 energy, 223

305

Fact-Finding Mission of the Human Rights Council, 286 humanitarian aid, 290 Joint Peace Fund, 290 LIFT (Livelihoods and Food Security Trust Fund), 290 Multi-Annual Indicative Programme for 2014–2020, 290 My Justice, 290 political and strategic interests, 226–229 SMART Myanmar, 290 STEP Democracy, 290 trade, 223–224, 290–291 trade privileges, suspension of, 284 Eurostat, 223 Eurozone crisis, 23, 29, 64 EU-South Korea FTA, 88 Exclusive Economic Zone, 35, 163, 165 Expanded ASEAN Maritime Forum (EAMF), 25

F Ferraz, 205 Fiji, 141 Financial Action Task Force (FATF), 276 Finland, 113, 219 Five Power Defence Arrangements (FPDA), 173–174 freedom of navigation operation (FONPOS), 168 foreign direct investment conditions for attracting, 80–82 inflows, 83 Foreign Service Institute, 119 Forum for India Pacific Island Cooperation (FIPIC), 41 France, 8–9, 14, 36, 143–144, 162, 163n1, 165, 170–173, 177–178,

306

INDEX

195, 197, 204–205, 217, 219, 230, 251, 254, 271 2030 French Strategy in AsiaOceania towards an Inclusive Asian Indo-Pacific Region, 172 and Indo-Pacific subsidiaries, 171n2 trade, 171n2 White Paper on Defence and National Security of 2008, 170 White Paper on Defence and National Security of 2013, 171 French DOM-TOMs (French Overseas Departments and Territories), 171n2 French Polynesia, 170–172 Friendship Railway Bridge, 139 Fu Ying, 7 Futuna, 172

global governance, 52 global value chains, 82, 85 globalisation, 52, 135 Globerman, S., 76 Gokhale, Vijay, 66 Gorbachev, Mikhail, 268 Great Game, 61, 264–265 Greater Mekong Subregion (GMS), 136 Greece, 8, 55–56, 62, 65, 143–144, 262 Gujral, Inder Kumar, 107 Gulf Cooperation Council (GCC), 190–191, 195–196, 198–199 Gulf of Aden, 192 Gulf War (1991), 190 Gurkhas, 173 Gwadar, 194

G G-7, 144 G-20, 161 Gadhafi, Muammar, 204, 206 Garland Highway, 195 Garuda naval exercise, 175 Gaza, 201 General System of Preferences (GSP), 284, 287, 291 Geneva accords (1988), 268 Geneva conference on Afghanistan, 217 Georgia, 271 Germany, Federal Republic of, 8–9, 64–65, 143–144, 195, 197, 204, 215, 217–219, 230, 243, 254, 271 Ghana, 142 Ghani, Ashraf, 271, 273–274 Gilson, J., 115 Global Britain, 177 Global Competitiveness Index, 90

H Haftar, Khalifa, 205–206 Hambantota, 34, 164 Hamlet , 107 Hashimoto, Ryataro, 104n3 Hayton, Bill, 174 He Lei, 162n1 Health Silk Road, 142 Hekmatyar, Gulbuddin, 269 Herat, 139, 275 hexiao, gongda policy, 163 Hezbollah, 229 Hindu Kush, 263, 275 HMS Juffair, 189 Hong Kong, 8, 29, 65, 138n2 Hormuz Strait, 191 Huawei, 9, 142 human rights, 5–6, 12, 15, 56, 59 Human Rights Watch, 5 humanitarian assistance and disaster relief (HADR), 36 humanitarian intervention, 52

INDEX

Hungary, 55–56, 61, 143–144 Hunt, Jeremy, 214 Hussain, Saddam, 266 Hyde Act, 220 I Idlib, 203 India, 1–2, 36, 38, 45, 49, 83, 86, 108, 110, 113–116, 138–139, 142, 151, 161–162, 164–165, 171–172, 178–179, 238 and Africa, 139 and ASEAN, 25–26 and Asia, 23–24 and BRI, 140–143 and China rise, 137 and connectivity, 137–140 and European integration, 46–47 and France, 175–176 and Indo-Pacific, 166–168, 174 and Kashmir, 242–243 and SAARC, 37 and Saudi Arabia/Qatar rift, 198–199 connect Central Asia policy, 139 economy, size of, 48 engagement of EU institutions, 49–50 intellectual property rights, 89 liberalisation, 88–89 Link West policy, 192 maritime security in Asia, 34–36 Maritime Security Strategy (2015), 166 membership of UN Security Council, 51 Ministry of External Affairs, Indo-Pacific Division, 143, 167 multinationals, 89 National Investment and Infrastructure Fund (NIIF), 199

307

Neighbourhood First, 167 nuclear tests (1998), 115, 219, 243 Parliament, 240 sustainable modernization, 13 India-Afghanistan development assistance, 274–275 Pakistan role, perception of, 275 India-China standoff at the Line of Actual Control (LAC), 46 India-European Union and EU institutions, 49–50 as natural partner, 10 BTIA, 13, 89, 91–95 Elements of an EU Strategy on India (2018), 13, 238 FDI, 10, 92–94 human rights, 12–13 joint statement (2017), 211 Roundtable on civil society, 244 strategic partnership, 241 summits 1st (2000), 238 3rd (2002), 239, 247 trade, 91–95 India-Iran and regional connectivity, 228 and terrorism, 228–229 divergences, 229 energy imports, 223 political and strategic interests, 226–227 trade, 223–224 India–Myanmar aid, 292 and Rohingyas, 292n4 FDI, 293 trade, 292–293 India–Myanmar–Thailand (IMT) Trilateral Highway, 139 India-West Asia historical relations, 187–188 Indian interests, 190–192

308

INDEX

Indian diaspora, 190 FDI, 190 Indian Airlines, 270 Indian National Congress, 242 Indian Ocean, 13–14, 34, 36, 39, 65, 138–139, 145, 161, 163–171, 175–177, 188, 192, 221, 226, 175–176, 263 and France Indian Ocean Littoral, 163–164 Indian Ocean Naval Symposium (IONS), 36–37, 172, 176, 192 Indian Ocean Rim Association (IORA), 38–39, 150, 166, 172, 176 Indo-Pak war of 1965, 265 Indo-Pak war of 1971, 265 Indo-China, 281 Indo-Pacific, 2, 12, 22–23, 33, 35, 40, 136, 138, 140, 161–162, 164, 166–170, 172–173, 175–177, 252, 280 and ASEAN, 178–179 and BRI, 164 and China, 162–165 and EU, 169–170 and France, 170–173, 175–177 and Germany, 14 and India, 23, 166–168 and Indo-French cooperation, 175–177 and middle powers, 178 and Quad, 165–166 and UK, 173–174 Indo-US civil nuclear agreement, 220–221 Indonesia, 31, 83, 86, 88, 95, 116, 140, 161, 163, 171 information and communications technologies (ICT), 135–136 Information Fusion Centre for the Indian Ocean Region, 167

Instrument in Support of Trade Exchanges (INSTEX), 217–219, 225, 231 intellectual property rights, 5, 66 International Atomic Energy Agency (IAEA), 213, 219–220 International Civil Aviation Organization, 35 International Criminal Court, 52 International Maritime Organization, 35 International Monetary Fund, 143, 219 International North-South Transport Corridor (INSTC), 136, 138–139, 149, 228, 230 International Seabed Authority, 165 Investment Development Path (IDP) and government role, 79 inward and outward FDI, 88–91 theory and drivers, 78–82 Investment Facility for Central Asia, 149 Iran, 51, 138, 138n2, 189–195, 199– 200, 204, 211–213, 217–219, 221, 226, 264 Afghan refugees in, 219 and China, 223–224 and EU, 212–214, 230 and India, 214–215, 230 and India-EU cooperation, potential, 230–231 as energy and economic partner, 223 nuclear issue, 215–223, 230 Revolution, 214, 267 sanctions, 216, 225 Iran-Iraq war (1980), 190 Iran-Pakistan-India pipeline, 221 Iraq, 6, 189, 191, 207, 218, 266 Ireland, 14

INDEX

Islamic State in Iraq and Syria (ISIS), 25, 200, 204, 229 Israel, 142, 192, 200, 202, 221, 230 Istanbul Process, 226–227 Italy, 9, 11, 14, 105–106, 122, 143–144, 204–205, 219, 254, 271 J Jaishankar, S., 138, 252 Jaish-e-Muhammad, 229, 246 Jammu, 250 Jammu and Kashmir, 229, 268 Japan, 14, 31, 36–37, 55, 83, 88, 91, 103–104, 109, 113, 124, 138n2, 139, 143, 148, 161–162, 166, 171, 177–179, 280 Expanded Partnerships for Quality Infra (EPQI), 150 Japan International Cooperation Agency, 40 Jiaolong , 165 jihad, 229, 268 Jiwani port, 34 Joint Comprehensive Plan of Action (JCPOA), 194–195, 211, 213, 215–216, 218–219, 222–223, 230 Jordan, 190–191, 194–195 Juncker, Jean-Claude, 8, 13, 53 Juncker Plan, 145n3 K Kaladan Multimodal Transit and Transport Project, 26, 40, 139, 289 Kandahar, 262–263, 269 Karzai, Hamid, 275 Kashmir, 12–13, 49, 237–238, 240, 242–244, 246, 256 and EU, 238–241, 246

309

development assistance, 248 and European Parliament, 242–246 and Germany, 243 and India, 255–256 and Netherlands, 243 and UK, 243 and US, 246 Assembly, elections, 246–247 Assembly, suspension of, 251 civilian casualties, 244 formula for, 247–249 human rights violations, 242, 247 insurgency, 245 postmodern worldview, 253–255 Report on Kashmir: Present Situation and Future Prospects, 244 special status, end of, 249–250 and Europe, 251–253 Kashmir Centre, 243 Kashmir Valley, 249–250 Kazakhstan, 31, 263 Kennard, William, 7 Kenya, 269 Khan, A.Q., 220 Khan, Amir Abdul Rehman, 264 Khan, Daud, 266 Khan, Ismail, 269 Khashoggi, Jamal, 196 Khatami, Mohammad, 212 Khomeini, Ayatollah, 266 Khurshid, Salman, 122–123 Kofi Annan Commission, 292n4 Korea, North, 51 Korea, Republic of, 10, 31, 37, 83, 86, 88, 91, 103–104, 113, 124, 138n2, 161 Kovind, Ram Nath, 280 Kuka, 65 Kunming, 142 Kunming-Singapore high-speed railway project, 142

310

INDEX

Kuwait, 188–189, 194 L La Réunion, 171, 176, 178 Ladakh, 249 Lakshadweep, 165 Lal, Rollie, 11 Laos, 26, 38, 31, 109, 113, 139, 142 Laos-China railway, 142 Lashkar-e-Taiba, 246 Latin America, 85, 253 Le Drianin, Jean-Yves, 175 Leading Asia’s Private Sector Infrastructure Fund (LEAP), 40 League of Arab States, 204 Lebanon-Israel war (2006), 190 Lee Kuan Yew, 58 Li Peng, 5 Libya, 190–191, 193, 204, 207 and EU, 204–205 and France, 205–206 and India, 206 and Italy, 205 High National Electoral Commission, 204 National Army, 205 National Transition Council, 206 Quartet, 204 Line of Actual Control (LAC), 46, 66 Line of Control (LOC), 249 Lisbon Treaty, 49–50, 84 LNG, 221 Lok Sabha, 120 Look East policy, 23, 25, 101, 123–124, 137, 281, 291 Luc, Tuan Anh, 173 Luttwak, Edward, 134 Luxembourg, 51, 123 M Macedonia, 144

Macron Emmanuel, 9, 14, 36, 175–176 Mahathir, M., 107 Major, John, 104n3 Makran, 262 Malacca Strait, 34 Malaysia, 31, 83, 86, 88, 95, 104, 106–107, 109, 116, 122, 141, 163, 165, 171, 173, 281 Maldives, 35, 138, 141, 164–165, 167, 168 Malta, 206 Manama Dialogue, 192 Mandelson, Peter, 48, 52 Mansour, Mullah Akhtar, 271 Marin, Manuel, 106 Maritime Domain Awareness, 167 Maritime Silk Route, 164 Massoud, Ahmed Shah, 269 Mauritius, 140, 168 May, Theresa, 174 Mayotte, 171 Mazar-i-Sharif, 226, 269 Mediterranean, 8, 144, 164, 173, 193 Megasthenes, 262 Mekong Ganga Cooperation (MGC), 38 Mekong–India Economic Corridor (MIEC), 38 Mercosur, 83 Merkel, Angela, 9, 14 Meshri, Khaled, 205 Mexico, 83 Michel, Charles, 218 Middle East, 163, 187, 198, 201–202, 211, 214, 229–230 migration, 5, 204 Mina Salman port, 189 Ministerial to Promote a Future of Peace and Security in the Middle East’ Conference (2019), 214 Misri, Vikram, 292

INDEX

Modi, Narendra, 2, 13–14, 24, 26, 139, 166, 175–176, 192, 202, 215, 248–252, 284n1, 289, 291–292 Mogherini, Federica, 169, 195, 213, 216–217 Mongolia, 113–114, 122 Monnet, Jean, 3 Montenegro, 144 Morocco, 83, 193 Mujadedi, Fazlullah, 269 mujahideen, 267–268 Mukherjee, Bhaswati, 239 Mukherjee, Pranab, 107, 122 Mullah Omar, 271 multilateralism, 52, 57 multipolarity, 56–57, 192 Muslim brotherhood, 191 Myanmar, 24, 26, 29, 31, 34, 38, 51, 88, 109, 112–113, 138–139, 142, 164 and China, 280, 282, 293–294 and EU, 283–287, 289–292 and GSP, 291 and India, 287–289 and insurgency in Northeast India, 283 and UK, 281 challenges, 293–294 democracy, 293 human rights, 283, 286–287 insurgent groups, 288 nation-building, 293 sanctions, 283–284 State Law and Order Restoration Council (SLORC), 283 State Peace and Development Council (SPDC), 283–284 strategic importance, 280 N Naidu, M. Venkaiah, 123

311

Najibullah, Mohammad, 268 Narula, R., 90 National Conference, 242 National Democratic Alliance (NDA), 289 National League for Democracy (NLD), 281, 285, 293 Natnaz, 212 Ne Win, 280, 288 Nehru Award for International Understanding, 108 Neom, 197 Nepal, 138, 173 Netanyahu, Benjamin, 202 Netherlands, 14, 144, 149, 219, 243, 281 New Caledonia, 171–172 New Zealand, 31, 83, 88, 103–105, 108–111, 171, 173 NGOs, 247, 283 Nicholson, Emma, 244 Niger, 205–206 Noble Peace Prize, 279 non-aligned movement, 137, 214 non-alignment, 53 Non-Proliferation Treaty, 202, 219, 256 non-tariff barriers (NTBs), 88 non-traditional security, 21, 28 Nordic summit, 14 North Africa, 187 North Atlantic Treaty Organization (NATO), 196, 203, 206, 241, 247 Northeast Asia, 113, 255, 288 Northern Aleppo, 203 Northern Alliance, 226 North-West Frontier Province (NWFP), 265 Norway, 23, 142 Nuclear Suppliers Group, 202

312

INDEX

Nuremberg Declaration on an EUASEAN Enhanced Partnership, 27 O Obama, Barack, 254, 271 Okinawa, 178 Olympic Games, 48 Oman, 188–189, 191–192, 194 Omar, Mullah, 269 Orban, Viktor, 61 Organisation of Islamic countries (OIC), 191, 202 Organization for the Prohibition of Chemical Weapons (OPCW), 200 Ottoman Empire, 188, 263 P P5+1 initiative, 215 Pacific Islands Forum (PIF), 23, 172 Pacific Ocean, 144, 161, 167 Pacific Plan, 41 Pahlavi, Shah Reza, 214 Pakistan, 12, 31, 34, 47, 103–104, 108, 110–111, 113–116, 138n2, 141–142, 144, 164, 194, 214, 226, 228–229, 239, 241, 245–250, 255, 261–263, 265, 267–271, 273 Palestine, 188, 192, 201–202 and EU, 202 and India, 201–202 and US, 202 Pan Wei, 6 Panipat, 263 Pant, H.V., 168 Paris Accord on climate change, 29 Parly, Florence, 171–172 Pashtunistan, 265 Patten, Chris, 48, 58, 111 Pax Brittanica, 188

Pax Sinica, 164 Pejsova, Eva, 170 People’s Liberation Army (PLA), 34 Persian Gulf, 139, 171, 179, 189, 191, 195, 201, 225, 230, 263, 269 Peru, 83 Peter the Great, 263 Philippines, 31, 83, 88, 116, 163 Piraeus, 56, 65, 144 Pokharan, 243 Poland, 122, 141 Pompeo, Mike, 166, 195, 213 Portugal, 14, 188 post–modernism, 2, 52 post-Westphalian system, 2–3 Pratap, Mahendra, 264 Prodi, Romano, 48 PSA Peugeot Citroën, 213 Pulwama, 229 Putin, Vladimir, 200 Q Qahtani, Saud Al, 196 Qatar, 188, 191–192, 194–199, 207, 273 Qatar Investment Authority, 199 quadrilatère français (French quadrilateral), 171 Quadrilateral Security Dialogue (QUAD), 36, 148, 165–166 Quartet, 195, 201–202 R Rabbani, Burhanuddin, 269 Rafsanjani, A.H., 214 Raisina Dialogue, 218 Rajya Sabha, 120 Rajoy, Mariano, 14 Rakhine State, 282, 286, 290, 293 Rao, P.V. Narasimha, 23, 214, 288

INDEX

Rasmussen, Anders Fogh, 240, 247, 256 ReCAAP (Regional Cooperation Agreement on Combating Piracy), 22, 39 Red Sea, 188, 191 Regional Comprehensive Economic Partnership (RCEP), 26 Regional Cooperation Agreement on Combating Piracy in Asia, 172 Rej, Abhijnan, 168, 176 Rifkind, Malcolm, 103 right-wing populism, 10 Rogers, James, 174 Rohingyas, 279, 282, 285–289, 291, 293–294 and India, 289, 291, 292n4 Romania, 113–114 Rouhani, Hassan, 212, 218, 228 Roy-Chaudhury, Rahul, 168 Russia, 4, 31, 134, 146, 189, 195, 200–201, 207, 213, 219, 251, 253, 261, 263–264 Rwanda, 139

S SAGAR (Security and Growth for All in the Region), 140, 167 SAGARMALA, 140 Saint-Mézard, Isabelle, 177 Salame, Ghassam, 204 Salma hydroelectric dam, 275 Salman, Mohammed bin, 196 Santer, Jacques, 112 Saran, Samir, 39 Saran, Shyam, 57 Saudi Arabia, 189–200, 225, 230, 266 Indian diaspora, 198 Saudi Arabia/Qatar rift and Europe, 195–198 and India, 198–199

313

Scandinavia, 204, 254 Schembera, Kerstin, 290n3 Schuman Plan, 3 Seleucus Nicator, 262 self-determination, 245–246 Sembawang, 173 Serraj, Fayez, 205 Seychelles, 140, 168 Shah, Ahmed, 263–264 Shah, G.M., 242 Shah, Nadir, 263 Shah, Timur, 264 Shah, Zahir, 266 Shanghai Cooperation Organisation (SCO), 116, 139 Shangri-La Dialogue, 162n1, 167, 169, 171, 173 Shapiro, D., 76 Siala, Al Taher, 205 Sidhu, Jatswan S., 284 Siemens, 213 Silk Road Economic Belt, 164 Singapore, 31, 83, 86, 88, 95, 102, 104, 111, 116, 142, 144, 171, 173, 281 Singh, Manmohan, 23, 105, 123, 248, 289 Singh, V.K., 122–123 Singhvi, L.M., 103 Sittwe Port, 139 SLOC, 163, 171, 175–176 Slovenia, 122 Smart Cities, 149 soft power, 52, 54 Softbank, 197 Solana, Javier, 52n7, 123, 241, 246, 256 Soleimani, General Qassem, 218 Somalia, 169, 192 South Africa, 39, 83, 139 South African Development Community (SADC), 136

314

INDEX

South Asia, 12, 34, 38, 47, 50, 112, 115, 142, 144, 150–151, 163, 243–244, 246, 251, 272, 276, 281 South Asia Growth Quadrangle (SAGQ), 37 South Asia Sub-Regional Economic Cooperation (SASEC), 37, 138 South Asian Association for Regional Cooperation (SAARC), 23, 37–39, 50, 138, 150, 227 South China Sea, 22, 31, 33–34, 36, 55, 65, 162, 162n1, 163, 166, 168–169, 171–174, 179 and EU, 37–38 Code of Conduct (COC), 36, 163, 169, 171 South Pacific, 36 South Pacific Defence Ministers Meeting, 172 Southeast Asia, 30–31, 35, 38, 101, 106, 109–111, 114, 116, 122–123, 138, 138n2, 150, 161– 162, 164–166, 174, 178–179, 279–281 Sovereignty First, 3 Soviet Union, 66, 189, 245, 265–269 Spain, 14, 141, 144, 241 Sri Lanka, 31, 34–35, 38, 138, 141, 144, 164, 168 strategic autonomy, 138 Sudan, 6, 51, 205 Suez Canal, 165, 191 Suez crisis, 254 sustainable connectivity, 147 sustainable development, 34 Sweden, 9, 219, 238 SWIFT, 216 Switzerland, 14, 144 Syria, 7, 190–191, 193, 196, 199–202, 204, 217, 229–230 and EU, 199–200

and India, 200–201

T Taiwan, 163 Tajikistan, 261, 263, 269 Taliban, 226–227, 230, 269–271, 273–274, 276 and India, 274 shuras , 271 terrorism, 135 Tesla, 197 Thailand, 26, 31, 38, 83, 88, 112, 116, 122, 138 Than Shwe, 288–289 Thant Myint-U, 288 Tharoor, Shashi, 39 Thein Sein, 285 Thirty Years’ War, 3 Tiananmen Square incident, 59 Tibet, 6 Tobruk, 205 TOTAL, 197, 205 Tower of Babel, 54 trans-Anatolian pipeline, 203 Transatlantic Trade and Investment Partnership (TTIP), 86 Trans-Eurasian Information Network (TEIN), 136 trans-European Transport Network (TEN-T), 147 Trans-Pacific Partnership (TPP), 29 Treaty of Amity and Cooperation in Southeast Asia, 172 Trilateral Highway, 26, 40, 289 Trump, Donald, 2, 10, 13, 15, 29, 86, 145, 166, 194, 202, 213, 225, 230, 272, 276 Tunisia, 193, 206 Turkey, 4, 138n2, 141, 191, 196, 198, 200, 202–203 Turkmenistan, 261, 263

INDEX

Turkmenistan-Afghanistan-PakistanIndia Pipeline (TAPI), 139

U U Win Myint, 292 Uganda, 139 Uighurs, 8 Union Solidarity and Development Party (USDP), 285 United Arab Emirates (UAE), 171, 188–192, 195–199, 205–206 United Kingdom, 23, 55, 108–109, 144, 162, 163n1, 165, 170–171, 177, 188–189, 195, 197–198, 200, 204, 215, 217, 219, 230, 243, 254, 261, 263–264, 266, 271 and Indo-Pacific, 174 Conservative Party, 243 Liberal Democratic Party, 244 UK-Bahrain, defence cooperation agreement (2012), 189 UK-UAE defence cooperation agreement (1996), 189 United for Consensus group, 202 United Nations, 5, 13, 51–52, 56, 199, 201, 204, 251, 265, 269 General Assembly, 108, 201 Security Council, 51, 199, 201–202, 211, 215, 220, 244 Security Council Resolution 1970, 206 1973, 206 2254, 200 254, 199 UN Action Plan on Libya, 204 United Nations Convention on the Law of the Sea (UNCLOS), 33, 36, 55, 162, 167, 169 UN Human Rights Council, 144, 290

315

UN Support Mission in Libya (UNSMIL), 204 United Progressive Alliance (UPA), 289 United States, 5–6, 9, 14, 29–30, 36–37, 40, 55–56, 54, 67, 84, 133, 143, 146, 148, 162, 165–166, 168, 170–171, 189– 190, 195, 198, 201, 204, 207, 213–215, 220–221, 225, 228, 230, 245–247, 251, 253–254, 265–267, 269, 271, 275, 280, 284 and Afghanistan, 226 and Iraq, 226, 230 Congress, 197 International Development Finance Corporation, 40 State Department, 12 Uzbekistan, 139, 261, 263, 269 V Vajpayee, Atal Bihari, 214, 241, 248, 289 Valencia, 144 Varuna naval exercise, 175 Vietnam, 26, 31, 38, 83, 88, 112, 116, 122, 139, 163, 171 Von der Leyen, Ursula, 14, 65–66 W Wahabi Islam, 196 Wallis, 172 Wani, Burhan, 249 Washington Consensus, 63 weapons of mass destruction, 221 West Asia, 2, 13, 187, 190, 193, 200, 204, 253, 266 and colonial powers, 188–190 and EU, 193 and migration, 203–204

316

INDEX

and Turkey, 202–203 and US-EU relations, 206–207 West Europe, 146, 267 Western Pacific Naval Symposium (WPNS), 172 Westphalian system, 3 Wigemark, Lars-Gunnar, 249 Williamson, Gavin, 173 World Bank, 64, 143 World Trade Center, 270 World Trade Organization (WTO), 13, 52, 54, 82, 213 World War I, 188, 264 World War II, 204, 245, 265–266 Wuhan spirit, 143 X Xi Jinping, 63, 162

Xinjiang, 6

Y Yemen, 190–191, 193, 196–199, 207, 217, 229 Yugoslavia, 4, 144, 238

Z Zaranj-Delaram Road, 195 Zarif, Mohammad Javad, 212, 217–218, 226 Zeman, Milos, 62 Zia ul-Haq, 267 Ziegler, Alexandre, 177 Zimbabwe, 51 Zoroastrianism, 214