India- ASEAN Relations

India’s relationship with ASEAN over the years

• Political: India’s political relationship with ASEAN has been cordial and cooperative.
  • India has been actively engaged with ASEAN in various regional forums and initiatives, such as the ASEAN Regional Forum (ARF), ASEAN Defence Ministers’ Meeting + (ADMM+), and the East Asia Summit (EAS).
  • In 2012, India and ASEAN elevated their relationship to a Strategic Partnership, which marked a significant milestone in their bilateral ties.
  • India’s Act East Policy, which was formally enunciated in 2014, is a key pillar of its foreign policy and is focused on expanding its engagement with ASEAN and other countries in the region.
• Economic: ASEAN is one of India’s largest trading partners.
  • India and ASEAN have signed an FTA that has boosted trade and investment between the two.
  • ASEAN is India’s 4th largest trading partner. Total trade stood at $110.4 billion in 2021-22.
  • ASEAN-India Business Council (AIBC) was set up in 2005 with the aim of fostering closer business linkages.
  • The ASEAN-India Agreements on Trade in Service and Investments entered into force in 2015.
  • India has a Comprehensive Economic Cooperation Agreement (CECA) with various countries of the ASEAN region which has resulted in concessional trade and a rise in investments.
  • The ASEAN India-Business Council (AIBC) was set up in March 2003 in Kuala Lumpur as a forum to bring key private sector players from India and the ASEAN countries on a single platform for business networking and sharing of ideas.
• Regional connectivity: India is working on enhancing connectivity with ASEAN countries through the India-Myanmar-Thailand (IMT) Trilateral Highway, the Kaladan Multimodal Transit Transport Project etc.
• Security and Defence: Joint Naval and Military exercises are conducted between India and most ASEAN countries.
  • The maiden Asean-India Maritime Exercise is held this year (2023).
  • Watershed’ Military Exercise was held in 2016.
  • Also, partnership between ASEAN and India helps in countering Terrorism, Violent Extremism and Transnational Crimes, including through implementation of ASEAN Plan of Action in Combating Transnational Crime (2016-2025).
  • India places ASEAN at the centre of its Indo-Pacific vision of Security and Growth for All in the Region (SAGAR).
• Tourism and people to people contact – India is the first Dialogue Partner to sign an MoU on Strengthening Tourism Cooperation with ASEAN.
• Education and research: India has established the ASEAN-India Centre at the Research and Information System for Developing Countries (RIS) to promote research and studies on ASEAN-India relations.
• Delhi Dialogue, 2009: It is an annual Track 1.5 forum for discussing politico-security, economic and socio-cultural issues between ASEAN and India.
• Funding: Financial assistance has been provided to ASEAN countries from the ASEAN-India Cooperation Fund, ASEAN-India S&T Development Fund and ASEAN-India Green Fund.

Divergence of India ASEAN Relations

• Implementation of projects: One of the major challenges is the lack of time-bound implementation of projects, such as the India-Myanmar-Thailand trilateral highway and Kaladan multimodal project, which would enhance connectivity between India and the ASEAN region.
• Trade and economic ties: Despite efforts to strengthen economic ties, India’s trade and economic ties with ASEAN are much below their potential. China remains the largest trading partner of the regional grouping, followed by the European Union and the United States.
• Free mobility of labour: The free mobility of labour within the ASEAN Economic Community region might hamper India’s prospects in terms of mobility of skilled workers, which has just been implemented with the ASEAN-India Services agreement.
• Quadrilateral Security Initiative: ASEAN has not been very favourable to the rise of QUAD as a significant security institution in the region. It is neither willing to be entangled in the possible power transition taking place in the Indo Pacific.
• Low FDI: India’s FDI in ASEAN is also low in comparison to China, with China’s FDI to ASEAN standing at a much higher figure.
• Slow pace of implementation: The slow pace of implementation and lack of willingness to take risks has deterred India’s public sector enterprises and private companies from making substantive investments in the Southeast Asian region.
• Territorial disputes: ASEAN member states are enmeshed in territorial disputes with interested powers for a long time, which creates a challenge for maintaining peaceful relations.
• Indo-Pacific rivalry: The rivalry between major powers in the Indo-Pacific region, such as China and the United States, threatens the underlying stability on which rested the regional growth and prosperity.
• Wobbling geopolitics: The geopolitical tension in the Indo-Pacific is producing geoeconomics consequences where issues of trade and technology cooperation as well as supply chain resilience are at peak. This is happening at a time when ASEAN remains a divided organization internally on how to manage these challenges.

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