What We Expect the 20th ASEAN-India Summit to Deliver?

Prabir De

Introduction

A week from now, the 20th ASEAN-India Summit is going to take place in Jakarta. Started in 2002 in Cambodia, the ASEAN-India annual summit process is going to complete an eventful two-decade partnership. ASEAN-India relations have grown from strength to strength and the two sides have never been so close, with growing trade and investment flows, friend shoring, and people-to-people contacts.

The Indian Prime Minister will participate in several key summits, including the East Asia Summit and the 20th India-ASEAN Summit next week. The Indian PM’s presence underscores the continuity of India’s proactive engagement with ASEAN and the East Asia Summit (EAS).

For the first time, ASEAN will host the maiden ASEAN-Indo-Pacific Forum (AIPF). The US Vice-President is scheduled to attend the first ASEAN Indo-Pacific Forum (AIPF), to highlight the importance of the region and the bloc’s ongoing efforts to implement its ASEAN Outlook on the Indo-Pacific (AOIP). Three major issues which are likely to be discussed: green infrastructure and resilient supply chains, digital transformation and the creative economy as well as sustainable and innovative financing.

The forum has lined up heads of governments from ASEAN dialogue partners, including China, Japan, South Korea, Australia, and Canada. Why is it so important for a Head of State to attend the summit meetings? The summit meetings hold high significance as they offer opportunities for leaders of participating countries to meet and gain from dialogue and interactions. Since 2002, India has not missed a single ASEAN-India summit.

ASEAN-India Regional Engagements

ASEAN and India share both land and maritime borders. They are civilizational partners. India has been enjoying its strategic location, democracy, market size, natural resources, access to the coast, and the advantage of a young population. So also ASEAN. ASEAN and India together share 7 per cent of the world GDP and 26 per cent of the world population. Their combined strength is, therefore, phenomenal. ASEAN is currently India’s 4th largest trading partner, and India is ASEAN’s 7th largest trade partner. ASEAN has truly become a global economy, where FTAs have played a key role in the integration.

ASEAN and India have been witnessing the best phase of their relations post-pandemic. The bilateral trade between them was just US$ 9 when they had the 1st summit way back in 2002, and now the trade is likely to cross the US$ 150 billion mark by the turn of 2023. India and some of the ASEAN member states such as Malaysia have agreed to trade in local currency. More ASEAN member states are likely to follow suit. The gross cumulative investment flows between ASEAN and India exceeded US$ 100 billion during 2000-2022.

In an integrated regional block, what matters is the strength of connectivity. Weak connectivity nullifies the advantages of FTA. India has come up with a series of physical and digital connectivity initiatives with ASEAN member states such as the Kaladan multimodal transit transport project, Trilateral Highway, and digital payment arrangement with Singapore, to mention a few. ASEAN has shown interests in India’s UPI.

Several flagship connectivity projects are also in pipelines. Impressive achievements have been observed in the case of people-to-people contact through higher education, tourism, etc., and the ASEAN has shown deep interest in the area of science and technology cooperation with India.

ASEAN and India celebrated the 30th anniversary last year and the relations between them have elevated to the Comprehensive Strategic Partnership (CSP) level. They have agreed to establish the ASEAN-India CSP that is meaningful, substantive, and mutually beneficial. Both of them have reaffirmed the importance of maintaining ASEAN Centrality in the evolving regional architecture in the Indo- Pacific, and deepening dialogue and coordination through existing ASEAN-led mechanisms and fora, including the ASEAN–India Summit, the East Asia Summit (EAS), the Post Ministerial Conference with India (PMC+1), the ASEAN Regional
Forum (ARF), the ASEAN Defense Ministers’ Meeting-Plus (ADMM-Plus), the Expanded ASEAN Maritime Forum (EAMF), and cooperate on initiatives to support and contribute to the ASEAN Integration and Community-building process.

What follows is that the last twenty summit years present India’s energetic engagements with ASEAN, which have transformed the relationship into the realm of Indo-Pacific. India and ASEAN advocate a free, open, rules-based and inclusive Indo-Pacific region, and call for peaceful resolution of disputes while respecting the sovereignty and territorial integrity of all nations. Both sides have agreed to continue to work on shared interests and aspirations in ensuring regional peace, security, and stability.

Recent Activities

The year after the Commemorative Summit till date has been full of activities. Soon after the Summit on 12 November 2022, India and Cambodia co-chaired the maiden India-ASEAN Defence Ministers’ Meeting in Siem Reap on 22 November 2022, followed by the 9th ASEAN Defence Ministers’ Meeting (ADMM) Plus on 23 November 2022.

The ADMM Plus is an annual meeting of Defence Ministers of ten ASEAN countries and its eight dialogue partner countries, viz., India, USA, Russia, China, Australia, Japan, New Zealand, and South Korea. Almost at the same time, the second edition of the ASEAN-India Music Festival was held from 18 to 20 November 2022 in New Delhi.

Next, India along with Australia and Singapore co-hosted the EAS Hackathon on “Combating Marine Plastic” on 13-16 December 2022 in Jakarta. In parallel, the 4th ASEAN-India Workshop on Blue Economy was held in New Delhi on 15-16 December 2022. ASEAN and India also organised the 3rd Grassroots Innovation Forum, 2022 on 19 December 2022 in Phnom Penh.

ASEAN countries joined the Voice of Global South Summit, hosted by India on 12-13 January 2023. The 4th ASEAN-India Youth Summit was held in Hyderabad on 12-16 February 2023. Thereafter, the ASEAN-India and EAS Senior Officials’ Meetings were held in Jakarta on 7 March 2023. The 25th ASEAN-India Senior Officials Meeting (AISOM) was an important mechanism to discuss strategic issues of common interest and concern between ASEAN and India. ASEAN and India reaffirmed their commitment to further strengthen their Comprehensive Strategic Partnership at the 25th AISOM.

The meeting also discussed ways to further strengthen cooperation in several areas of mutual interest including maritime activities, transnational crimes, cyber-security, science and technology, transport and connectivity, digital economy, fintech, tourism, agriculture, environment, sustainable development, and public health. The 1st ASEAN-India Maritime Exercise 2023 was held in the 1st week of May 2023.

The maiden ASEAN-India Maritime Exercise successfully culminated in the South China Sea on 8 May 2023. Approximately 1400 personnel manning nine ships participated in the Sea Phase of the multilateral naval exercise with ASEAN naval ships from Brunei, Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Vietnam. This was another remarkable milestone achieved by ASEAN and India in 2023.

The ASEAN Post Ministerial Conference with India (PMC+1) was held in Jakarta on 13 July 2023. This PMC saw the adoption of the Annex to the Plan of Action to Implement the ASEAN-India Partnership for Peace, Progress, and Shared Prosperity (2021-2025) to ensure that the ASEAN-India Comprehensive Strategic Partnership will be substantive, meaningful, and mutually beneficial.

On 20 July 2023, the 1st ASEAN-India Conference on Traditional Medicines was held in New Delhi. Thereafter, the 20th ASEAN-India Economic Ministers’ Meeting (AIEMM) was held in Semarang on 21 August 2023, which was perhaps the last major interaction before the 20th ASEAN-India Summit.

The 20th AIEMM followed up the progress of the review of the ASEAN-India Trade in Goods Agreement (AITIGA) and endorsed the Term of Reference of the AITIGA Joint Committee, the Work Plan of the AITIGA Review Negotiations, and the Negotiating Structure for the AITIGA Review. The Meeting reiterated its commitment to make the AITIGA more user-friendly, simple, and trade facilitative for businesses to increase ASEAN-India trade as well as support sustainable and inclusive growth.

Some Critical Challenges during Summit

What are the major critical challenges that India faces in ASEAN? First, unlike the EU, ASEAN is not a single market. Second, barriers are very high in borders and NTMs have been rising. An increase in NTMs could raise trade costs, inhibiting trade expansion. Besides, there are restrictions on the movement of professionals, capital, and goods. Well, some of them are not India-specific, but some discriminate India over ASEAN’s other trade partners.

On the other hand, ASEAN too faces high barriers to trade in India. ASEAN is not comfortable with the CAROTAR rules, which was imposed by India in September 2020. The CAROTAR is also a major constraint to the GVC formation between the two trade partners. India may consider removing the CAROTAR, which has affected the trade relations. Besides, ASEAN too faces rising tariffs and domestic protections.

Way Ahead

Indian External Affairs Minister (EAM) said, “ASEAN is a crucial pillar of India’s Act East policy and its vision for the wider Indo-Pacific. A strong and unified ASEAN plays an important role in the emerging dynamic of the Indo-Pacific. India firmly supports ASEAN centrality and the ASEAN Outlook on the Indo-Pacific.” ASEAN and India have agreed to collaborate on the Indo-Pacific. AOIP’s convergence with the Indo-Pacific Oceans Initiative (IPOI) provides a strong basis for the next phase of ASEAN-India cooperation.

ASEAN and India should also work together to forge green infrastructure and resilient supply chains, explore cooperation on the Single Window platform to enhance trade facilitation and integration and promote the development of MSMEs and start-ups. The areas that offer high prospects are pharmaceuticals, health, cyber, financial, and maritime security domains. India’s International Solar Alliance (ISA) or the Coalition for Disaster Resilient Infrastructure (CDRI), etc. offer many solutions to ASEAN’s current changes. “Progress and prosperity can only be lasting when they are shared both within societies and between them,” EAM reminded.

Doing things on time is key to gaining from regional engagements. Look at Table 1 India has started late and missed the early opportunities. Winners begin early. Nevertheless, there is enough good scope to correct the gap since the global order has been changing in favor of India.

Table 1: Trade Engagements with ASEAN

ChinaIndiaKorea
Total goods trade with ASEAN
(US$ billion), 2022
979133207
Framework Agreement for
Goods Trade signed in
200220042005
FTA in goods implemented in200520102010*
Framework Agreement for
services trade signed in
200720142005
FTA in services implemented in200720192007
Investment Agreement
implemented in
200920192009
FTA review completed in2019Not yetNot yet
*Implemented partly in 2006
Sources: Author’s own based on the IMF DOTS and ASEAN Secretariat

In the next round, both ASEAN and India may like to promote the quality trade and resilient production networks and supply chains. The implementation of services and investment agreements is long overdue. Concluding the negotiation of

the AITIGA review may take time but ASEAN and India may intensify their efforts to achieve a substantial conclusion even before the new deadline of 2025. After the completion of the summit meetings, the ASEAN chairmanship will transfer from Indonesia to Lao PDR, thus providing another opportunity to conclude a substantial part of the review in 2024.

In parallel, both need to add momentum to the implementation of the ASEAN-India Joint Statement on Cooperation on the ASEAN Outlook on the Indo-Pacific for Peace, Stability, and Prosperity in the Region. Under the AOIP framework, there are four areas of priority: maritime cooperation, connectivity, sustainable development, and economic cooperation. There are several common areas of cooperation between ASEAN’s AOIP and India’s IPOI. India and ASEAN should scale up their engagements in implementing the AOIP-IPOI projects.

Needless to say, the outcomes of the forthcoming G20 summit may provide the future direction for ASEAN-India relations. For example, the digitalization of trade documents, enhancing information access to MSMEs, a framework to map global value chains, best practices on mutual recognition agreements for professional services, and a standards dialogue were the five outcomes of the G20 Trade and Investment Ministers Meeting (TIMM).

The outcome document also has three annexes, namely, G20 Generic Framework for Mapping GVCs, Jaipur Call for Action for enhancing MSMEs’ access to information, and High-Level Principles on Digitalization of Trade Documents. Both ASEAN and India have already made good progress on these five fronts.

Today, tensions between countries over trade and investment are undermining growth and trust. ASEAN and India may further intensify their cooperation to stabilize the global order. At the World Economic Forum’s Annual Meeting in Davos in January 2023 focused on the theme of ‘Cooperation in a Fragmented World’, the Director-General of the World Trade Organization called for a bolstering of global cooperation, and a move towards “reglobalization” as opposed to trade fragmentation and friendshoring. “A friend today may not be a friend tomorrow,” the DG of WTO warned.

Conclusion

India has witnessed a splendid performance in the Southeast Asia having further scope for improvement. India has carved out its place in ASEAN and so also ASEAN in India and the relationship between them is truly irreversible. Given India’s strong leadership, the coming 20th ASEAN-India Summit is expected to bring significant decisions adding further momentum to ASEAN-India relations.

References

Refer to, Indonesia Foreign Ministry’s statement, available at https://events.kemlu.go.id/aipf

Refer, https://mea.gov.in/bilateraldocuments.htm?dtl%2F35876%2FJoint_Statement_on_ASEANIndia_Comprehensive_Strategic_Partnership

Based on press releases available at https://www.indmissionasean.gov.in/press_india_arch

Some of these challenges were well explained in De, Prabir (ed.) (2024) Thirty Years of ASEAN-India Relations: Towards Indo-Pacific, Routledge, New Delhi, Forthcoming, available at https://www.routledge.com/Thirty-Yearsof-ASEAN-India-Relations-Towards-Indo-Pacific/De/p/book/9781032617473

Refer to the Remarks by External Affairs Minister, Dr. S. Jaishankar at the opening session of the ASEAN Post Ministerial Conference with India in Jakarta, Available at https://mea.gov.in/SpeechesStatements.htm?dtl/36791/Remarks_by_External_Affairs_Minister_Dr_S_Jaishankar_at_the_opening_session_of_the_ASEAN_Post_Ministerial_Conference_with_India_in_Jakarta

Disclaimer: All views expressed in the article belong solely to the author and not necessarily to the organization. 

This article was posted by Mansi Garg, a research intern at IMPRI.

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