India’s Act East policy appears to be working
When Prime Minister Narendra Modi upgraded India's look East policy to Act East policy in November 2014, many had wondered if this would merely be a re-branding effort or lead to a significant improvement in India's relations with South East Asia. A little more than a year later, one can say that it is the latter — a fact that was highlighted at the ongoing Delhi Dialogue conference, the country's premier Track 1.5 event on its relations with the Association of South-East Asian Nations. As Minister for External Affairs Sushma Swaraj noted in her keynote address, in this past year alone, India's independent mission to Asean was formally inaugurated in Jakarta, and an ambitious Asean-India Plan of Action, which sets the framework for the bilateral for 2016 to 2020, was adopted. Importantly, the India-Asean free trade agreement has also been completed, with the implementation of service sector pact (the goods pact was already in force). As a follow-up measure, the Ministry of Commerce and Industry is now establishing a project development fund to help integrate Indian business in the Asean production chain and set up manufacturing hubs in Cambodia, lao PDR, Myanmar and Vietnam. India has made significant progress in improving connectivity with its Asean partners. This has long been an impediment to better relations but it seems like the situation is finally changing. The core waterways component of the Kaladan Multi Modal Transport project is almost complete, and work on the additional waterway and road components will begin soon. The India-Myanmar-Thailand Trilateral Highway is also in the pipeline and construction will begin with the Friendship Bridge connecting Moreh and Tamu on the India-Myanmar border. Additionally, the Rih-Tedim Road project, which is to provide all-weather connectivity between eastern Mizoram and western Myanmar, has also been finalised. Another indicator of the India-Asean bilateral has prioritised under the Act East policy is the number of high-profile political visits that have taken place — Since the end of 2014, India's top executive leadership alone has visited nine out of the 10 Asean countries. Vice President Hamid Ansari has just returned from Brunei and Thailand. He had previously visited Cambodia, lao PDR and Indonesia. The Prime Minister visited Myanmar, Singapore and Malaysia, and will soon travel to the Philippines. And of course, the President made a well discussed visit to Vietnam.
One important challenge to the India-Asean relationship is the impact of new mega trading blocs such as the Trans-Pacific Partnership. India is currently working on a similar trade agreement with Asean, called the Regional Comprehensive Economic Partnership Agreement, which is to be concluded this year. Now, there is a possibility that the two might become competing regimes. This will hamper regional efforts to set up an effective economic community.