THE DEMOCRACY THAT IS INDIA: INTRIGUING, EVOLVING AND INSPIRING

Marking 75 years of Indian Independence

By George I. H. Cooke

Preserving democratic values, ensuring the maintenance of democratic standards and strengthening the process of democratization, are formidable measures for any country. When a country with a population of nearly one and a half billion embraces democracy as its political ideology, continuously champions this system for more than seven decades and implements it across the entirety of its length and breadth and at all levels of its political being, it is clear that democracy has been able to withstand much. India is today the largest democracy on the planet, and with its position comes much responsibility.

The democratization of India, whereby the world saw the abandoning of hereditary monarchical systems, and the dismantling of the privileged structure that had existed even through colonialism, was to set India on a pedestal. Yet this pedestal was not one of natural influence and ability. It did not occur accidentally either. It was to be one on which and from which India, her leaders and people would be called upon to formulate and implement policies that would sustain democracy, nurture its values and ensure that all - irrespective of their communities, religions and castes - who identified as Indian, would be beneficiaries. The journey was not without its challenges, but it is the journey itself that remains remarkable.

The Intrigue - Lessons of the Past

At Independence, Jawaharlal Nehru, was at pains to ensure that India remained a secular nation, which rallied around the Indian flag and identified primarily as Indians, before all else. Undoubtedly it was a firm foundation that gave the Indian nation a strong start. His presence at the helm for seventeen years till 1964 guaranteed that the seeds he sowed would have the opportunity to grow unhindered for nearly two decades. In many neighbouring countries of South Asia, leaders at independence did not survive for even a decade thereafter to see the results of their pre-independence struggles or to fully implement policies they deemed fit for their emerging countries.

India thus received an advantageous commencement on a journey, that has seemed more like a race, with neighbours, with the Cold War, with non-alignment, and with economic liberalization among other entities and concepts, but most importantly with internal challenges of keeping a country as diverse, as different, and as divided as India, together. This diversity is upheld today as a great boost for image and publicity in the international community. Yet arriving at the present involved much cohabitation, compromise and cooperation, that was, is and continues to be unparalleled in the world.

The Evolution – Overcoming Challenges

While it is argued that the holding of elections at regular intervals and electing leaders are not the totality of democracy, they are key components. In the last 75 years Indians have elected leaders and political parties and in so doing removed others, who were subsequently bought back at later times. Leaders have resigned, died in office, been assassinated, Parliament has been attacked, the fundamentals of democracy have come under siege, but despite all of these occurrences and much more, the Republic remains strong. Presiding over a federal system that aims to embrace the diversity and overcome the differences is a complex task. In reflecting upon that which has been, it is evident that the complexity has been comprehended. If not, the Republic would have disintegrated quite some time ago.

Lincoln observed that people remain at the core of any democracy. Whether the ones who are elected, or the ones who elect, it is people who are the direct beneficiaries of any democratic society. Thus, people must never leave the equation nor allow themselves to be excluded from it. If any attempt has been made or is being made to restrict that which a democracy affords, all effort needs to be exerted to rein in the constrictions and permit instead the prevalence and proliferation of all that a democracy stands for.

In neighbouring Sri Lanka, the oldest democracy in this part of the world having gained universal franchise in 1931, when efforts were underway to undermine people, with ill-advised policies, erroneous decisions, incompetent leadership and heightened corruption, that collectively misled a nation of 21 million, people rose up. In proof that democracies are constantly evolving, the people forced leaders out of office due to the aforementioned reasons, and demanded change. While mandates are given at elections, mandates can also be withdrawn especially through mass protests that signify the displeasure of the people and their desire to safeguard the democratic standards that are enshrined in the constitution and which must be preserved in a democracy.

The Inspiration - Strategizing for the Future

Democracy with all its complexities and connotations is still the optimal governance system for any country. Giving people the freedom to elect their representatives who in turn are called upon to formulate sound policies which would have a positive impact on the entirety of the polity, is by far the accepted form of governance, and is widely practiced. India, as the world’s largest democracy has a bigger burden. This is not confined to the implementation of proactive democratic principles within the country alone. It extends to the immediate sub region, the greater Asian region, and the international community. The Indian model, despite its complications and conundrums experienced within, is still the largest working model in the world today. With the growth in population, this position is not likely to be changed for the rest of the 21^st century, and would only be further strengthened in the decades to come.

The onus is thus on India. Indian leaders have an obligation to their people, which extends beyond. The first obligation is to the people of the vast country to be able to live in a society that enshrines basics freedoms, guarantees equality in all respects, and promotes understanding amid diversity. At no time must the citizenry of a country that occupies this primal position be forced to compromise on their freedoms, have their voices silenced, find themselves bereft of recourse to justice, encounter an erosion of democratic institutions, or have any form of ideology foisted upon them. The liberal nature of democracy can create space for such challenges to thrive, but it is the people who remain at the core, and who must be able to thwart any weakening or destabilizing of the democratic norms upon which their nation has been built.

The second obligation is to countries that adhere to the democratic form of governance. If a country the size of India falters, the repercussions would be widespread. Thus far the country has survived in close geographic proximity to two of the largest countries, that advocate different policies of governance. Whilst their preferred policies have been implemented for decades, and would prove effective for them as a means of governance, the larger Asian neighbourhood has adopted democratic norms, as has most of the world. Any faltering or failure to remain the strong, representative democracy that India was envisioned to be at independence, would prove detrimental to many.

Given the challenging global environment in which democracy attempts to thrive, with a skew of ‘isms’ disrupting countries and their courses, India has a third obligation to the democratic tradition as a whole. The concept was first coined in the middle of the 5^th century to denote the system of governance in Greek city states, which had populations of several thousands. Thereafter it survived millennia, and is today practiced in a single country that possesses a population of nearly one and a half billion. This is testimony to the fundamental importance of the system, its traits and what it proffers its adherents. Therein India remains an inspiration to all, from fledgling states to well-founded ones, and cannot renounce its role.

As India surges ahead towards further milestones, it is the action taken at present, that would see the country emerge as a global giant or remain a regional power. Whether through partnerships with the Quadrilateral Security Dialogue (QUAD) or membership in the Bay of Bengal Initiative for Multisectoral Technical and Economic Cooperation (BIMSTEC) or even Shanghai Cooperation Organization (SCO), through intensified performance in larger multilateral bodies like the United Nations and its affiliated agencies and organizations, or even in its bilateral relations in South Asia and the world, India can readily rely on two key features, democracy and diplomacy. Both have been strategically implemented and have stood the country in good stead. However as with all key characteristics, no lapses can be encountered, no slips allowed and no mistakes permitted.

India’s place in the world, and also in history has been guaranteed to a large extent by its democratic credentials, which have been bolstered by an effective diplomatic apparatus. In its engagement with the people of India, the people of the region, and those of the world, the Indian leadership has and must continue to safeguard democratic ideals, and guarantee their implementation. A strategized foreign policy administered by an effective and efficient diplomatic structure will see the country raise its stakes for global leadership, realize that which was envisaged more than seven decades ago, and reinforce the enormity of potential and opportunity of the country and her people.

 

 

 

 

 

SHINZO ABE: PRESERVING HIS LEGACY

Guest Commentary by Banura Nandathilake

Subscribers to international relations often come to a junction between theories: Realism, which posits a zero sum world where external circumstances such as hard power and anarchy that are beyond any individual define the ways in which states do what they do, and constructivism which understands an interdependent society of states where leaders truly have an tangible impact on inter-state relations through social mechanisms. The case for the latter seems to outweigh the former in the analysis of Shinzo Abe however, who left an ineffaceable mark on Japanese foreign policy, by guiding a largely pacifist Japan to one that actively moulds and shapes the security, economic and diplomatic architecture of the Indo Pacific and beyond.

As the heir of a distinguished political family, Abe entered politics in the 1990s where he sought to largely continue the policies of his grandfather, the former Japanese Prime Minister Nobusuke Kishi: Regain the ability to exert Japanese power on the regional and world stage by removing the shackles imposed by the US and a faction of the then Japanese political class. As such, Abe went on to become Japan’s longest-serving Prime Minister with four terms (2006-7, 2012-14, 2014-17, 2017-20). On 8 July 2022 however, in an event that stunned the heavily gun restricted Japan, the former Japanese Prime Minister was shot and killed during his campaigning run for his party in the Japanese city of Nara. Despite the untimely passing of the "shadow shogun", the direction of Japan's future may be influenced by, thereby correlate with Abe's "vision" to a great extent (Green, CSIS 2022). Japan has built a full-fledged national security establishment, an estimated 1.7% growth in GDP in 2022, and is a bastion of neo liberal democratic policies in the Indo pacific. Below is an obituary for a man who had a heavy hand in reawakening Japan, wherein his effect on domestic and foreign policies will be appreciated.

Domestic Political Legacy

While for many, Abe’s career was one of dramatic and unlikely turns which spanned 14 years and saw him into extraordinary power to influence the direction of Japanese domestic policy, Sheila Smith of Council on Foreign Relations and others understand that a revised domestic constitution may be Abe's major legacy.

Just two days after Abe’s assassination, the Japanese voted in the Upper House election, awarding the government led by the current Prime Minister Fumio Kishida their anticipated victory. Interestingly, Smith notes that the assassination had no credible change in the election environment. The voter turnout was on par with previous years, and Abe’s party, the Liberal Democratic Party (LDP) had a structural advantage as the smaller opposition parties did not form a united front thus further dividing the vote. As such, an Upper House win by the LDP could open an avenue for a Constitutional revision, once an ambition of the former Prime Minister. While factors that may postpone an immediate revision do exist, she notes that a revision could have a lasting impact on Abe’s legacy.

Abenomics

Abe’s vision was of regaining the ability to exercise Japanese power, by losing her shackles imposed by low domestic economic power and capital, which can then be turned into military might and diplomatic currency. However, Japanese capabilities were idling, due to the lack of opportunities as per legal and international constraints in the post WW2 era. In the understanding that securing Japan’s future would require an economy with a new foundation for growth, the economic programme “Abenomics” was born. The programme was an attempt to kickstart Japan’s dormant capabilities through expansionary monetary policy, fiscal stimulus, and a long list of industrial, labour, and regulatory policies to incentivise endogenous development. Abenomics aimed to shift production from agrarian or low value sectors to high income productive sectors to slow the decline of Japan’s labour force, in an “serious, sustained, and flexible attempt to grapple with Japan’s growth challenges” (Harris, FP 2022).

Abenomics was instrumental in reviving the Japanese economy, as well as supercharging Abe’s political career. The programme reversed years of stagnation, boosted corporate profits and state tax revenues, thereby reducing unemployment and crime. As such, Abe was able to coast past domestic elections, pausing the tradition of short-lived premierships in Japan. The resulting political durability allowed him to pursue long term ambitions, such as creating a National Security Council which distilled the defence apparatus through the Prime Minister’s office. Such a creation then allowed for a more active foreign policy over the existing passive structure, which sought to strengthen regional ties while balancing against regional hegemons. 

Japan-India Relations

Relations between Cold war Japan and India were one of polite distance: Japan was a US ally, while India was procedurally non-aligned with some overlap of interests with the USSR. Despite the deterioration of the said relations during the 1988 Indian nuclear missile test and the Japanese economic sanctions that followed, the two states were quick to repair and rebuild a “global partnership’’, proposed by the Japanese Prime Minister Mori Yoshiro a few years later during his visit to India. However, it was Abe that built the stage for a more cohesive and interdependent Japanese-Indian relationship, such as the “India Japan Strategic and Global Partnership’’ (2007). Bilateral relations were further strengthened during Abe’s third term in 2014 through a “special and strategic partnership,” which encompassed diplomatic, security and economic sectors. Trade between Japan and India increased exponentially from 2007, while Japan and India cooperated on security issues in the Indo-Pacific through the Quad.

Moreover, it could be understood that Abe's 2007 visit to India was not only significant for the Japan-India relationship, but also India’s perception of itself and its role in the region (Miller, CFR 2022). Miller understands that it was Japan that influenced India, ‘a notoriously reluctant and cautious actor in global politics’ to join Abe’s Indo-Pacific vision, which now serves as an ideological, economic and military buffer to the rise of China. This vision of the “confluence of the two seas” - Pacific and Indian, were first outlined by Abe in his speech during his first visit to India in 2007, and laid the foundation for the “free and open Indo-Pacific” concept which was later adopted by the United States.

China and the Quad

China’s rise in the contemporary era has been unprecedented. An authoritarian political system combined with a quasi-capitalist economic system has allowed China to gain regional hegemony and a global great power ranking, allowing its influential military, economic and diplomatic alliances. Such a rise presents a growing threat and demands a balance of power between China and the US and Allies. Of those allies, Abe represented a significant one: Japan.

While Abe was central in expanding India's position in the Indo-Pacific, his pragmatic approach to relations with China demanded a closer look. Abe could be considered a soft liner on Sino-Japan relations, so much so that he was called a "traitor" by many Japanese patriots. This may be so since the uneven economic balance of power weighed more towards China than Japan: Japan needed China for trade and manufacturing, than vice versa. However, as Mireya Solís, the director of the Centre for East Asia Policy Studies at the Brookings Institution understood, despite his efforts to maintain closer relations with China “Abe felt very strongly that Japan could not live in an Asia where China had hegemony”. As such, Abe’s pragmatism recognised that despite interdependence and globalisation, China represented a challenge on all fronts, diplomatic, economic and military. Ergo, Abe may have been instrumental in setting the tone for the Japanese defence apparatus. Furthermore, Abe subscribed to right leaning nationalist policies domestically, as he helped coax a pacifist Japanese public to oppose China’s meteoric and bullish rise, further laying the groundwork for the direction of Japanese foreign policy.

However, his vision of a free and open Indo-Pacific may have trumped all else. His influence soon superseded national and regional boundaries, as President Joe Biden, who once worked with Abe as the vice president during the Obama administration, put it “He (Abe) was a champion of the Alliance between our nations and the friendship between our people”, and promised to continue Abe’s “vision of a free and open Indo-Pacific” (2022). The US and Japan, along with India and Australia, form the Quadrilateral Security Dialogue, which represents a bulwark against China in the Indo-Pacific. While the US had more economic and military might than Japan, Abe was still paramount in laying the rhetorical groundwork for the Quad, “providing structural, conceptual ideas to things that needed to be provided at a time when it seemed like it was crumbling.” (Hornung, 2022).

On Taiwan

A great power conflict in East Asia appears to brew over the Island of Taiwan which stands a stone's throw away from the shores of China. While the ideological divide stems from the great powers US and China, US allies such as South Korea, Japan and Taiwan are not passive watchers either.

Japanese leaders before Abe were uncomfortable with using force to defend Taiwan, as implications of such a move for Japanese security, and how Japan's responses to such scenarios were heavily debated. But it was Abe that argued in 2021, “a Taiwan emergency is a Japanese emergency, and therefore an emergency for the Japan-U.S. alliance. President Xi Jinping in particular, should never have a misunderstanding in recognizing this”. Abe was thus paramount in transforming Japan’s relationship with Taiwan to counter threats from China, for he recognised a hegemonic China posed a risk not just to the security of the liberal democratic states of East Asia, but their economic and sociological institutions as well. As such, Prime Minister Abe emphasised shared economic, political and ideological values between Japan and Taiwan, where he referred to Taiwan as a “precious friend,” an angle the incoming governments adopted thereafter. Abe was an advocate of stronger relations with Taiwan so much so that he went on to argue that the US policy of strategic ambiguity was “fostering instability in the Indo-Pacific region” as he called out the US to “make clear that it will defend Taiwan against any attempted Chinese invasion.”

Furthermore, it was during Mr. Abe’s tenure as Prime Minister that one of the major sore points in the bilateral relationship between Taiwan and Japan were resolved. After 17 years of negotiations, in 2013 Japan and Taiwan concluded Japanese recognition of Taiwanese Fishing rights in the East China Sea. As such, affection for Abe and Japan in Taiwan have reached record highs. Thus, after the news of Abe’s passing had reached Taiwan, President Tsai Ing-wen honoured “Taiwan’s most loyal best friend” with the national flag flown at half-mast.

Shinzo Abe could be called a realist, for he understood that despite diplomacy and the multilateral handshaking, states with different value systems and interests must communicate through hard power and deterrence. But to call him a pragmatist through the constructivist lens could be more apt, as he understood that despite anarchy and hard power considerations, leaders are still able to make a difference in the domestic and foreign policies of a state, thereby keeping up with an evolving world stage. As the world honours him in his passing, it is now up to his successors to carry his legacy forward.

 

RUSSIA OVERSHADOWS G7 2022 SUMMIT

GUEST COMMENTARY by Banura Nandathilake

Despite being an informal collective of ‘advanced economic’ liberal democratic states, the Group of 7 (G7) bringing together Canada, France, Germany, Italy, Japan and the United Kingdom and the United States have fervent goals. Held from 26 to 28 June 2022, the summit was in response to a global society capsized by division and shocks, as a call to unite and join to defend ‘universal human rights and democratic values, the rules-based multilateral order, and the resilience of democratic societies’ (G7, 2022). The viability of such remains to be seen.

Formed in 1975, leading states in a world of global economic recession induced by the OPEC oil embargo understood it may be in their mutual interest to coordinate on macroeconomic interdependencies. While it was first a forum for Finance ministers to hold annual meetings, the G7 developed into a round-table between leaders of the Western World. In 1988, Russia joined the G7, which was then named the G8 albeit temporarily until Russia’s dismissal for its annexation of Crimea from Ukraine.

The G7 states in the contemporary, with an aggregate that represents 45 percent of the global economy in nominal terms and 10% of the world’s population, hold annual summits to coordinate economic policy goals, facilitate collective action on transnational issues and propagate neo liberal norms, in conjunction with the European Union and other invitees. All 7 member states are identified as mature and advanced democracies with a Human Development Index score of 0.800 or higher.

Unlike international organisations and groups such as NATO, the G7 group has no formal legal existence, no permanent secretariat or official members. It thus has no legally binding rules that abide by or ratify states to uphold decisions and commitments made at G7 meetings. As such, while compliance with G7 norms is procedurally voluntary, they are impacted by social norms of persuasion, influence, mutual accountability and reputation. Topics of conversation between member states have encompassed growing challenges such as counterterrorism, development, education, health, human rights and climate change.

The 2022 Summit

From 26-28 June 2022, the leaders of G7 States met in Elmau, Germany joined by the leaders of Argentina, India, Indonesia, Senegal and South Africa, as well as Ukraine. Representatives included German Chancellor Olaf Scholz, Italian Prime Minister Mario Draghi, US President Joe Biden, British Prime Minister Boris Johnson, Canadian Prime Minister Justin Trudeau, Japanese Prime Minister Fumio Kishida, French President Emmanuel Macron, European Council President Charles Michel and European Commission President Ursula von der Leyen,

The summit focused on the Covid-19 crisis, climate change, the Russian Ukrainian conflict, and China. 

Climate Change

The shared concerns of climate change were a major topic of discussion during the 2022 Summit. The group endorsed the goals of an open and cooperative international Climate Club, in alignment with the 1.5°C pathways and hastened the implementation of the Paris agreement. The group further pledged to commit to a decarbonised transportation sector by 2030, a fully or predominantly decarbonised power sector by 2035. However, the latter may have been incentivised by political concerns of Western states to a major degree.

Liberal Democracies of the West

Liberal democracies may be understood to exist where the state subscribes to a liberal economic system and a democratic political system. A concise summary of such is as a liberal economic system proscribes significant political control over an decentralised, capitalistic, market driven economic system, as it is understood that the market mechanism is the most efficient means of linking demand to supply, market to consumer. A democracy may be understood as a domestic political model which, in conjunction with an impartial judiciary, free media and others, elected representatives aim to promote a decentralised representative governance through accountable, transparent and inclusive institutions.

By virtue of being a liberal democracy, all member states find common ground, parallel norms, alignment of macro foreign policy goals and understanding with each other. This allows the informal G7 to coordinate hard power security and economic interdependence in addition to cooperating with civil society groups to promote human rights, and uphold a democratic zone of peace in the face of non-democratic powers. A strong culture of mutual accountability exists between G7 states. Accountability may be through internal processors of the forum, where social norms allow for persuasion and disincentivize coercion. Coercion may not at all be necessary, as liberal democratic states would all be of a positive sum world view. Furthermore, the level of trade interdependence between states would act as means of checks and balances, as every state is needed by the other, thus it is in every G7 state’s interest to be in their good books.

The Illiberal Rest

Russia and China, in addition to states such as Iran, Saudi Arabia and Venezuela are understood by the West to be illiberal states. Both major powers, albeit one a receding power, have capitalist and liberal economic systems where the state’s political machine exerts a heavy pressure on the market mechanism. While the state may be able to provide a higher quality safety net to its citizens by restraining the destructive forces of capitalism to better allocate scarce resources amongst the vulnerable, significant barriers to such exist. China’s GDP has grown at a surprising rate vis a vis other developing states, which has allowed the CCP significant geopolitical leverage. However, China’s domestic political model is authoritarian, whereby citizens do not have much say in how they are governed. Exclusive political institutions have no means of accountability or transparency, which leads to significant corruption. As Wedeman (2004) analyses, corruption is a feature of the Chinese system, thereby stifling economic and social growth. Corruption and lack of domestic checks and balances to those in power may be more apparent in Russia than China, where the control of the Kremlin and the Oligarchs have poignant effects on not just its citizens but also its neighbours; as the lack of domestic accountability may mean the lack of stringent checks balances, which then mean lesser shackles on the zero-sum ambitions.

Russia-Ukraine Conflict

The Russia-Ukraine conflict may be interpreted as a conflict between the forces of liberal democratic values of positive peace, pluralism and self-determination versus a one man’s nostalgic dreams of a ‘Neo’ USSR. Being at complete odds, the reaffirmed condemnation of Russia’s ‘’illegal and unjustifiable war of aggression against Ukraine’’ by the liberal democratic G7 states is hardly a surprise. Nor is their promise of ‘’needed financial, humanitarian, military, and diplomatic support’’ for Ukraine in its defence of its sovereignty, during its path on a free and democratic society.

The Sanctions Regime

Sanctions and more sanctions were promised by the group of seven advanced economies, who vowed to “align and expand targeted sanctions to further restrict Russia’’ in its access to key technological industrial imports and services. Such a move would severely restrict the ability to sustain their war machine thereby adhering to security commitments to Ukraine. The G7 Leaders pledged new sanctions on Russians who had committed war crimes in Ukraine, and are contributing to exacerbating “global food insecurity” by “stealing and exporting Ukrainian grain”. New penalties on Russian gold exports were further proposed, as well as a cap on the oil price to phase out global dependency on Russian energy.

However, a complete restriction of the import of Russian energy may be an ambitious task. European nations such as France get a quarter of their oil and 40% of their gas from Russia. While Germany has halted the progress of the controversial Nord Stream 2 pipeline, the EU has currently agreed to reduce its Russian gas imports by only two-thirds. President Biden however is banning all Russian oil and gas imports to the US, and the UK is ready to phase out Russian oil by the end of the year. The US, UK and Ukrainian Leaders are keen for other G7 nations to follow suit.

Ukraine's President Volodymyr Zelenskyy, who joined in on a trio of meetings via Videolink, stated that the summit will show "who is our friend, who is our partner and who sold us out and betrayed us". He reiterated his calls for fresh deliveries of weaponry, as he believes Russia will want to extend the war until winter wherein they could make new territorial gains to consolidate power. The financial support of G7 allies in 2022 already amounts to more than USD 2.8 billion in humanitarian aid, and a further USD 29.5 billion is pledged in supporting Ukrainian reconstruction.

China and the BRI

A growing China poses a “threefold threat” to G7 countries — economically, ideologically, and geopolitically. China’s GDP is second only to the US and it is fast catching up. China’s growing state-overseen tech industry, fuelled by globalisation and interdependence, is fast spreading a culture of surveillance and censorship, which act as means for the globalisation of authoritarianism. Said authoritarian ideals are further spread through Chinese geopolitical projects and alliances such as the BRI, which usually focus on developing, quasi democratic states with little to no accountability such as those in Africa and Central Asia. Furthermore, China’s action with regard to the Uyghurs in the Xinjiang region and its influence in Hong Kong have drawn condemnation from G7 members. China’s growing trade and defence ties with Russia have also caused concerns.

A Western Counter to the BRI

A Western counter to the BRI emerged during the G7 summit, aptly named Partnership for Global Infrastructure and Investment. The BRI is a global infrastructure development strategy which was developed as per Chinese leader Xi Jinping's vision in 2013, as a means for China to assume a greater role in global politics by easing access to China and its capabilities and boosting global GDP. Dubbed the Belt and Road Initiative and with over 145 countries signed up, the BRI is currently constructing a network of overland routes, rail transportation, sea lanes and energy pipelines to connect China to Southeast Asia, Central and South Asia, the Middle East, Europe and Africa. However, the project has been criticised as a tool to increase China’s political leverage in developing countries. Thereby, the BRI has been criticised for neocolonialism, economic imperialism.

In such a context, the G7 had launched a $600bn Build Back Better World (B3W) initiative infrastructure plan to counter China, in private and public funds to finance infrastructure in developing low and middle-income countries over five years. By working to narrow the global investment gap, the B3W would create new Just Energy Transition Partnerships with Indonesia, India, Senegal and Vietnam, building on existing partnerships with South Africa.

While US President Biden understood that “Developing countries often lack the essential infrastructure to help navigate global shocks (thus) feel the impacts … and they have a harder time recovering,” he stressed that the B3W “isn’t aid or charity. It’s an investment that will deliver returns for everyone”. Despite being dwarfed in comparison to the multi-trillion-dollar BRI, the B3W offers means of accountability, transparency and mutual trust between the neo liberal developed states and the developing states. The initiative would, according to Biden, further allow developing states to “see the concrete benefits of partnering with democracies”. While a cynic may argue that the developed have no interest in the developing other than exploitation and/or self-interest, and such may be observed to be true, President Biden may have been right when he said that underdevelopment is “not just a humanitarian concern, but an economic and a security concern for all”.

Mutual gains depend on interdependence, and without developing countries, there cannot be any sustainable recovery of the world economy. However, the development of low-income states is necessary but insufficient for a holistic global economic recovery, which remains shadowed by the conflict of value systems: liberal and illiberal, democratic and authoritarian.

 

RCEP: Recipe for 21st Century Regional Cohesiveness?

 

by Trivan Annakarage

The Regional Comprehensive Economic Partnership (RCEP) has been signed into operation and is gaining traction owing to its magnitude and composition. As of 2020, the collective Gross Domestic Product (GDP) of all member states in the regional trade bloc amounted to 30% of global GDP (US$ 38.81 trillion)[1]. This figure is larger than the GDP of both NAFTA 2.0 (US$ 22.20 trillion) and the European Union (US$ 15.17 trillion) combined[2]. Moreover, the 15 member states represent a cumulative population of 2.2 billion people, amounting to 30% of world population[3]. Thus RCEP is currently the largest trade bloc to have existed in the history of multilateralism. At a time when the concept of multilateralism itself is brought into question, a regional trading bloc of such magnitude gives credence to the potential of RCEP.

Background

Signed on November 15, 2020 when Vietnam hosted a virtual ASEAN summit[4], RCEP represents three regions - Southeast Asia, Far East Asia, and Australia & Oceania. The Southeast Asian nation-states include all 10 ASEAN members namely, Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam. The Far East Asian countries include China, Japan and South Korea. The two countries from Australia & Oceania are Australia and New Zealand. RCEP is a key milestone for ASEAN since it was instrumental in its formation, and was able to bring China into the grouping without creating a fallout with Japan, South Korea and Australia, that experience tensed relations with Beijing.

RCEP is geared towards creating a tight knit market where member states can benefit from imports and exports with minimum trade barriers. In addition to trade in goods and services other focus areas include investment, intellectual property, dispute settlement and e-commerce followed by small and medium enterprises[5]. The latter is a very important focus area since SMEs comprise over 90% of business establishments in the 15 member countries[6]. Within the first 20 years of the trading bloc’s existence, RCEP plans to eliminate 90% of tariff imports between signatories[7] [8]. Furthermore, with the increasing traffic in the online market space and innovation that takes place in these regions, RCEP would establish common rules for e-commerce and intellectual property rights. The trade bloc has been criticised for not being explicit on labour laws, environmental protection and government subsidies[9]. Nevertheless, analysts argue that initiatives spearheaded by ASEAN begin with a broad vision and are gradually streamlined and achieved with necessary and timely amendments as time progress. This strategy has contributed to the longevity and relevance of ASEAN and would hopefully do the same for RCEP.[10] 

China’s prospects

The advanced democratic economies in RCEP (Japan, South Korea and Australia) are close allies of the United States. The recently invigorated military alliance; Quadrilateral Security Dialogue (QUAD) results in US, Japan, India and Australia’s joint effort to curtail China’s growing military prowess in the Indian Ocean and Asia Pacific. Against these developments RCEP becomes more intriguing as the United States is not part of it. This creates an absence of a power balance, with China being the most influential country in the grouping in terms of its economic and military might. If member countries work cohesively, RCEP would pull the economic centre of gravity closer to the East[11] [12]. The possibility of such a favourable outcome has therefore aided in softening the relationship between these three countries and China for a much larger purpose of economic prosperity.

The other trade bloc that would have rivalled RCEP was the Trans-Pacific Partnership (TPP) which was signed by 14 countries in 2016. President Donald Trump however withdrew USA from the trade bloc in 2017. This paved the road for the creation of RCEP due to the lack of momentum and cohesiveness in TPP[13]. Today, nine countries have membership in both RCEP and TPP.

In November 2019, New Delhi decided to stay out of RCEP sending out mixed signals. Prime Minister Modi outlined that the trading bloc did not address India’s need to commit to such an agreement.[14] Potential adverse effects to domestic industrial and agricultural sectors from Chinese manufactured goods and dairy products from Australia and New Zealand were cited as reasons[15] [16]. Yet experts predict Indian pharmaceuticals, cotton yarn and services industries would have benefitted enormously given the size of the market available[17].

If there was a vision for RCEP to become a mighty economic force from the East, this may have fallen short since India is the third largest economy in Asia after China and Japan. This may have been the reason why RCEP has provided flexibility to India to become a member-state in the future whenever New Delhi deems it fit[18]. However, Singapore’s former representative to the United Nations, Kishore Mahbubani, stated that the absence of both USA and India in this trace bloc has paved the way for China to proceed with its geopolitical ambitions and to create a unanimous economic ecosystem centred around RCEP where China would be its nucleus[19].   

Prospects and Concerns

It is clear that China, Japan and South Korea will reap the most out of this trade bloc[20]. For China, RCEP helps to leverage its position as a world power and invigorates her geopolitical ambitions for world ascendency through the Belt and Road Initiative. Moreover, it provides China with the opportunity to tighten her cultural affinity with a growing ethnic Chinese community across Southeast Asia. For Japan and South Korea, RCEP would be a new market to export their high-end industrial products as the quality of life in ASEAN and its share of billionaires is on the rise. It is an opportunity to enhance soft-power diplomacy in ASEAN, Australia and New Zealand through their respective entertainment industries. For Australia and New Zealand, RCEP is beneficial for an economic recovery strategy from Covid-19 as they access new export markets and explore investment in Southeast Asia[21] [22]. RCEP would provide greater access to developed economies for Southeast Asian countries such as Indonesia, Thailand, Myanmar, Cambodia and Laos whose economies largely depend on exports of finished garments, agricultural produce and commodities[23]. Countries such as Vietnam, Philippines and Malaysia would benefit from further investments in the tech industry. RCEP would have less impact on Singapore and Brunei since these countries have already established strong trade relations with the advanced economies of Far East Asia, and Australia & Oceania. If all member states are equally optimistic in the success of this trade bloc, RCEP might gradually bring about a solution to the ongoing disputes in the South China Sea and East China Sea. This is too early to judge though.               

A major concern is that since signing the agreement in 2020, not all member states have ratified the treaty. Currently only four countries - China, Japan, Singapore and Thailand - have ratified the treaty. The latter was the first to ratify it. This is a clear indication that there is opposition to this bloc domestically in these countries where ratification is pending. It must be taken into account that many countries in South Asia have a booming tech industry. RCEP might be a threat to this domestic industry due to flooding of low cost but equal/better quality Chinese imports. Further integration with the Chinese economy would mean Tokyo and Canberra being unable to fully commit themselves to supporting Washington’s geopolitical rivalries against Beijing. This would be detrimental to US influence over Southeast and Far East Asia.

The gradual ratification and operationalization of RCEP will undoubtedly lead to an economic revolution that has the potential to create a model for regional cohesiveness further into the 21^st century. However early ratification and realization of strategies remain crucial at this juncture.

---

[1] New Zealand Foreign Affairs & Trade (2021). Regional Comprehensive Economic Partnership. Avaialble at https://www.mfat.govt.nz/en/trade/free-trade-agreements/free-trade-agreements-concluded-but-not-in-force/regional-comprehensive-economic-partnership-rcep/rcep-overview 

[2]BBC News (2020). RCEP: Asia Pacific Countries form the largest trading bloc. Available at https://www.bbc.com/news/world-asia-54949260

[3] Shotaro Tani (2020). India stays away from RCEP talks in Bali. Nikkei Asia. Available at https://asia.nikkei.com/Economy/Trade/India-stays-away-from-RCEP-talks-in-Bali 

[4] CNA (2020). Asia-Pacific nations sign world’s largest trade pact RCEP. Available at https://www.channelnewsasia.com/news/business/rcep-trade-pact-asean-summit-singapore-china-13534960

[5] Laura Zhou (2020). Explainer: What is RCEP and what does an Indo-Pacific free trade deal offer China? South China Morning Post. Available at https://www.scmp.com/news/china/diplomacy/article/3109436/what-rcep-and-what-does-indo-pacific-free-trade-deal-offer

[6] Association of Southeast Asian Nations (2021). Regional Comprehensive Economic Partnership. Available at https://asean.org/?static_post=rcep-regional-comprehensive-economic-partnership

[7] Ibid^5 

[8] Ibis^6

[9] Keith Bradsher & Anna Swanson (2020). China-led Trade Pact is Signed, in Challenge to U.S. The New York Times. Available at https://www.nytimes.com/2020/11/15/business/china-trade-rcep.html

[10] Peter Petri & Michael Plummer (2020). RCEP: A new trade agreement that will shape global economic and politics. Brookings. Available at https://www.brookings.edu/blog/order-from-chaos/2020/11/16/rcep-a-new-trade-agreement-that-will-shape-global-economics-and-politics/

[11] CNA (2020). US being left behind after Asia forms world’s biggest trade bloc RCEP: US Chamber. Available at https://www.channelnewsasia.com/news/asia/rcep-us-chamber-of-commerce-left-behind-asia-economy-trade-13576598

[12] Amy Gunia (2020). Why the U.S. Could be the Big Loser in the Huge RCEP Trade Deal between China and 14 Other Countries. Time. Available at https://time.com/5912325/rcep-china-trade-deal-us/

[13] Charles Riley (2017). Trump’s decision to kill TPP leaves door open for China. CNN. Available at https://money.cnn.com/2017/01/23/news/economy/tpp-trump-china/

[14] Ibid^15

[15] ET Bureu (2019). India decides to opt out of RCEP, says key concerns not addressed. The Economic Times. Available at https://economictimes.indiatimes.com/news/economy/foreign-trade/india-decides-to-opt-out-of-rcep-says-key-concerns-not-addressed/articleshow/71896848.cms

[16] Business Standard (2020). What is RCEP? Available at https://www.business-standard.com/about/what-is-rcep 

[17] Ibid^15

[18] Bangkok Post (2020). What happens now the RCEP trade deal has been signed? Available at https://www.bangkokpost.com/business/2020503/what-happens-now-the-rcep-trade-deal-has-been-signed-

[19] Kishore Mahbubani (2021). Why Attempts to Build a New Anti-China Alliance Will Fail. Foreign Policy. Available at https://foreignpolicy.com/2021/01/27/anti-china-alliance-quad-australia-india-japan-u-s/

[20] Ibid^2

[21] Qu Caiyun (2020). Australia needs Southeast Asia for market, not politics. Global Times. Available at https://www.globaltimes.cn/content/1203633.shtml

[22] Ibid^1

[23] Heimkhemra Suy & Phnom Penh (2021). How RCEP benefits Cambodia in the long term. East Asia Forum. Available at https://www.eastasiaforum.org/2021/02/13/how-rcep-benefits-cambodia/