Modi, Abe back ‘free Indo-Pacific’

Modi, Abe back ‘free Indo-Pacific’


  1. India and Japan outlined a vision document for strengthening bilateral relations at the 13th annual summit held in Japan recently.

Important Facts:

2. Highlights of the vision document:

  • Both sides called for a “free and open Indo-Pacific” which is usually seen as a response to China’s growing dominance in the region.
  • Commitment towards upholding the rule of law and democratic values which underlies the new security architecture that Japan and the United States are trying to put in place to counter China.
  • The vision statement specifically mentioned the willingness of both countries to “expand concrete cooperation with the U.S. and other partners”.
  • It also referred to the necessity of ensuring the freedom of navigation and the importance of upholding the UNCLOS (United Nations Convention on the Law of the Sea), a set of conventions that China has been accused of flouting in the South China Sea.
  • The start of negotiations on an Acquisition and Cross-servicing Agreement, a logistics-sharing pact, that would allow Japanese ships to get fuel and servicing at Indian naval bases was also announced in the vision document.
  • A new Foreign and Defence Ministerial Dialogue, termed 2+2, was also announced that will include the Annual Defence Ministerial Dialogue, Defence Policy Dialogue and the National Security Advisers Dialogue.
  • On the economic front, the two countries have agreed to a Bilateral Swap Arrangement that would allow their central banks to exchange local currencies for up to $75 billion.
  • Earlier Japan had offered a $50 billion currency swap in 2013 and, before that, one for $3 billion in 2008. This is substantially more than the $30 billion currency swap arrangement announced between China and Japan.

3. Significance of the announcements:

  • Bilateral swap arrangement should aid in bringing greater stability to foreign exchange & capital markets in India.
  • The facility will serve as a second line of defence for the rupee after the $393.5 billion of foreign exchange reserves that the Reserve Bank of India (RBI) has at its disposal.
  • Once Acquisition and Cross-servicing Agreement is signed, Japan’s Maritime Self-Defence Force will be able to secure access to Indian naval facilities in the Andaman and Nicobar islands, which are strategically located close to the western Malacca Straits, a choke point for much of Japan and China’s trade and fuel imports.


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