By Aanchal Bajaj 

Intern IPPCS’21

An upgrade to the Look East Policy, which was conceptualized to increase economic growth and India’s engagement with South-East Asia in 1991, is the Act East Policy (AEP), implemented in 2014 with the objective of scoping and detailing the potential of improving the industrial growth of the North-East region of India while developing a strategic relationship with the extensive neighborhood of the Asia-Pacific region. Initiated under the current government led by Prime Minister Narendra Modi, the AEP is a diplomatic initiative that seeks to promote economic, strategic and cultural relations through constructive engagement with Southeast Asian countries in the fields of connectivity, trade, culture, defense and interpersonal contact at bilateral, regional and multilateral levels. The North Eastern Region of India has paid a heavy price due to the unstable period it witnessed in the recent past decades where anti-government militarized protests and violence constantly derailed initiatives taken for the development of the region. The economic contraction manifested in diverse ways: lack of infrastructure, absence of modern health services and scarce job opportunities. Act East Policy will help North East India in restoring economic stability while creating strategic regional ties. Due to north-east India’s geographic proximity, connectivity is the key to maintain regional cooperation with south-east Asia. Focusing on cooperation through preferential trade and investment agreements, the Act East Policy will be able to stimulate inclusive growth and achieve the North Eastern Region Vision of making it at par with other developed regions of the country.

One of the prime measures through which Act East Policy is achieving tangible results is by strengthening its connectivity and maritime cooperation with the Association of South East Asian Nations (ASEAN), the ASEAN Regional Forum (ARF) and the East Asia Summit (EAS). A robust strategic partnership is underway with Japan and South Korea to create a new convergence of interests. Japan has simultaneously shown interest in investing its technology in north-east India. The fifth bilateral cooperation meeting was held between Delhi and Tokyo this year to set out a vision of ‘Free and Open Indo-Pacific’ through the platform of Act East Forum. The two parties exchanged information to deepen mutually beneficial cooperative relations and advance their alliance through healthcare, smart city and people-to-people exchanges. India-Japan seized the opportunity of the joint meeting to discuss about their connectivity building initiatives. The Act East Forum which is under Act East Policy, stated the advancement of ongoing transportation and water projects in north-east India which when completed will positively impact the national and regional economic activity. The projects of hydropower, sustainable development and harnessing of water resources in NER will be able to address problems of congestion, floods and will increase the standard of living and per capita income. In 2019, the Ministry of External Affairs of India commented on the global partnership of Japan and India. “A vast array of institutional mechanisms binds their partnership in such forums like the annual summit, strategic dialogue, defense dialogue, and numerous forums on energy cooperation, counter-terrorism, U.N. reforms, cybersecurity, and maritime cooperation. Further, India and Japan have institutionalized 2+2 Ministerial Dialogue.” 

The centrality of ASEAN’s role in the Asian diaspora makes it a key element in the Act East policy. There has been a rapid growth of trade and investment between India and ASEAN’s member countries. Policies such as ASEAN-India Free Trade Area have been the key to bring in investment. According to the AIFTA agreement tariffs for 75% of goods traded between ASEAN and India have been eliminated which will consecutively create economic benefits and increase international trade. An intensive infrastructure trilateral highway which will stimulate economic growth and improve the connection between ASEAN and India is under construction. The highway will join Manipur thru Myanmar to Thailand and to boost the ASEAN-India alliance the highway will extend to Laos, Cambodia and Vietnam. Prime Minister of India, Narendra Modi has declared a $ 1 billion credit line to strengthen the Act East policy by deepening the political and multifaceted cooperation between ASEAN and India. The completion of the trilateral highway will help North East India to inflate its trade and commerce prospects. In yet another achievement, India-South Korea signed a comprehensive economic partnership agreement to construct a robust bilateral trade. Their relation has become multidimensional as both the nations share mutual interest in creating cooperation in defense domains. Foreign direct investment of South Korea has also amplified in India by reaching US$ 5.71 billion in 2018 mainly due to Seoul entering the automobile market of India and South Korea’s New Southern Policy. An integrated approach to form alliances and improve the economy of Northeast while pragmatically identifying objectives to accomplish them, will positively enhance Act East policy and help in achieving India’s vision.
Though the Act East policy is a proactive developmental tool with distinct advantages, there also exist certain points that might lead to threats for the NER. A major aspect is the international security implication for North East India. To illustrate this factor, the Kalandan project authorized to connect ‘the north-east linking Kolkata to Mizoram via Sitwe port’ is under threat due to the perilous Arakan Army in Myanmar being powered by China. Cross border illicit activities predominantly human trafficking and smuggling of drugs can take place through the Kalandan Transport Project. In order to consolidate ‘security and growth for all in the region’ and strengthen the Act East Policy, the SAGAR initiative has been introduced by the Prime Minister of India to protect maritime traffic and provide humanitarian support through the Indian Ocean. The initiative has come into effect due to China’s threatening stance to disrupt India’s national security primarily due to its territorial claim on Arunachal Pradesh and its plan to construct a hydropower dam on the Yarlung Tsangpo river (Brahmaputra) in Tibet which will terribly affect the agriculture of Assam. Northeast India is important for Act East Policy to fulfil its developmental goals, endorse its foreign policy and revive an integrated economy through investments but with belligerent threats arising through China’s aggressive stance, India should move ahead cautiously without decoupling.

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