The visit to India of Singapore's Emeritus Senior Minister and former Prime Minister Goh Chok Tong earlier this week underlined the strong ties between India and Singapore. It also pointed to the vast untapped potential
With Prime Minister hosting Singapore’s Emeritus Senior Minister and former Prime Minister Goh Chok Tong earlier this week, there is a renewed interest in India-Singapore ties. Incidentally, relations between the two countries go back to the 14th century when Singapore was a juncture in the ancient route between India and Southeast Asia. In the post-colonial era, however, the relationship warmed up only in 1994 when Mr Goh, as the Prime Minister, popularised the concept of ‘India Fever’. The relationship got a further boost when India adopted a look East Policy. Since then, there has been an upswing in the trade and investment ties between India and Singapore, resource-rich and resource-dependent countries respectively.
As pluralistic societies, the two countries share similar concern about the challenges posed by terrorism and fundamentalism and have, therefore, found it mutually beneficial to evolve a broad framework of security cooperation. Realising the potentials which existed between the countries, they took one of the major steps of signing a Free Trade Agreement plus the Comprehensive Economic Cooperation Agreement in June 2005. Since then, trade between India and Singapore has been increasing steadily, reaching a record of $19.4 billion in 2013-2014 as compared to $4.2 billion in 2003-2004.
As quoted by Union External Affairs Minister, Ms Sushma Swaraj, the “partnership between India and Singapore is based on political, economic and cultural cooperation, with institutional frameworks of dialogue and vibrant people-to-people contact. And what makes their relationship unique is that it never rests on its successes; it strives constantly to be ahead of the curve, to be innovative and effective, and to add value and efficiency”. As a result of this, Singapore has emerged as India’s largest trading and investment partner, one of the largest source of FDI globally, replacing Mauritius. Because of the execution of a double taxation avoidance agreement with Singapore, the FDI inflows from Singapore added up to nearly six billion dollars (over Rs35,500 crore) in 2013-2014, compared to $2.3 billion in the previous year.
Due to the good business environment, strong air connectivity and the presence of a large Indian community (which accounts for 9.1 per cent of its total population), Singapore has become one of the preferred financial hubs for many Indian corporate houses. The presence of 45,000 registered Indian companies and nine Indian banks speak for the importance Singapore holds for India and vice versa.
Similarly, on the cultural front, India and Singapore have been active, as both their Governments have entered into Memorandums of Understanding for cooperation in arts, archives and heritage in 1993. This was followed by the signing of executive programmes, the latest being in 2011 for the period 2011-2014. Singapore has been crucial in reviving Nalanda University in India.
Analysts say that Indian companies see growing international business opportunities to be in Singapore, especially using it as a platform to venture into the region and the world as they globalise. Because the relationship between the two nations holds even greater potential, Ms Swaraj has outlined the ‘5s vision’ to further promote engagement between both the countries. This requires scaling up of trade, speeding up connectivity, focussing on urban development and water management for smart cities, developing skills, and engaging with Indian States on a larger scale.
Scaling up trade and investment requires exploring the scope of venture capital for innovations and for cooperative projects in developing countries. Improving connectivity requires Singaporean companies to look after connectivity and infrastructure projects of India, such as the Delhi-Mumbai Industrial Corridor, the Chennai-Bangalore Industrial Corridor and the North-East. Similarly, direct air connectivity between Singapore and the North-East, particularly Guwahati, is required to be launched, since the North-East is the gateway to the Asean hinterland. The setting up of smart cities requires a flow of ideas and expertise on urban planning and water management from Singapore. The skill development requirement by India can be met by the establishment of similar centres in the various States of India.
Further boost in the relation between the two countries can be had by extending the focus on Indian States. This will provide for an immense opportunity to showcase the cultural diversity of India to Singapore. The recent visit by West Bengal Chief Minister Mamata Banerjee to Singapore was a major initiative taken to attract FDI in India. It has led to the signing of three major agreements and 13 MoUs. These agreement in itself are a milestone for West Bengal.
A similar visit by Telangana Chief Minister K Chandrashekar Rao has also been a successful initiative in showcasing the new State, whose Chief Minister has promised the best industrial policy, business-friendly environment and incentives to attract investments from Singapore. The visit gave Mr Rao an opportunity to get a hang of the social, economic and political developments in Singapore.
India and Singapore have achieved proficiency in establishing strong cultural and economic linkages and people-to-people movement amidst the presence of challenges. The countries interact both at the country and the State-level. The combined efforts and strategic planning have brought the bilateral linkages between them to such a juncture that further opening up and adhering to the plan will enhance their partnership manifold. This will lead them to achieve newer heights in mutual cooperation.