Eyes on India

Eyes on India

News:

  1. Japan, South Korea, Taiwan and Australia are trying to forge closer economic ties with India.

Important Facts:

  1. Japan, South Korea, Taiwan, and Australia are planning to divert their economic interest, away from mainland China and towards Southeast Asia and India.
  2. Why these Nations are sceptic about trading with China and inclining towards India:
  • Rising concern over aggressive China’s Belt and Road Initiative.
  • Beijing’s militarization in South China Sea
  • Beijing’s use of its economic muscle for political purposes.
  • Suspending rare earth metal exports to Japan in 2010.
  • Seoul’s decision to install a missile defence system in 2017.
  • China’s limited market growth potential
  1. Strategy adopted by these Nation to contain China:
    Japan’s Policy:
  • Reviving TPP
  • Trade Agreement with EU
  • Constitutional revision for more overt Military role.
  • Japan’s Free and Open Indo-Pacific strategy to divert its investment Southeast Asia and India.

Korea’s New Southern Policy – Policy proposed by Korea’s president to focus on Southeast Asia, it also “makes India Korea’s key partner for cooperation.

Taiwan Southbound Policy – To enable investment in Electronics Manufacturing sector in India.

 Australia Policy– It has commissioned an ambitious India Economic Strategy with the goal of making India its third-largest investment destination and export destination by 2035.

  1. However, in spite of the attractive opportunities India may not be able to take full advantage because:
  • Uneven economic liberalization
  • Protectionist sentiments taking root (theory of protecting domestic producers by impeding or limiting, as by tariffs or quotas, the import of goods and services)
  • History of poorly-negotiated trade deals
  • General election around the corner.
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