Friday 13 July 2018

Modi-Moon building bilateral ties on mutual complementarities


Soaring nuclear ambitions of Kim Jong Un that threatened peace and security sent the region into a tizzy last year. The subsequent high-pitched verbal exchanges, name-calling, insidious threats by President Trump could hardly bring a semblance of peace. Undertaking arduous task of reducing looming nuclear exigency, South Korean President Moon Jae-in earnestly reached out to North Korea, rekindling fresh hopes of a plausible peaceful denuclearisation. Months into power, the son of North Korean migrants demonstrated rare statesmanship and maturity and worked for a Korean rapprochement in March. His unflinching efforts towards reducing tensions in Korean peninsula and a formal dialogue with its Korean counterpart, a near impossible feat earned him rich accolades, surging popularity ratings to 80%.

 Moon took over as President when South Korea was facing turbulent times. The unceremonious exit of former President Park Guen-Hye on charges of crony capitalism exposed the skewed dominance of the giant family-owned industrial conglomerates called chaebols in South Korean economy. Aside these new challenges, arm-twisting by China in the form crippling economic sanctions in response to the US deployment of THAAD in South Korea weakened growth rate. This economic coercion badly hurt country’s economy which was dependent on Chinese market. An assault on the economy prompted President Moon, sworn-in in May 2017 towards diversification as a hedging strategy. Moon soon launched the “New Southern Policy” (NSP) in November 2017 on his visit to three ASEAN countries. The policy rests on 3-Ps: building people-centred, peace-loving and mutually prosperous community soon became cornerstone of his foreign policy doctrine. NSP resonates with Modi’s Act East Policy, which seeks to enhance and deepen partnership with India’s eastern counterparts.

Modi indeed was one of the first few leaders who wished Moon on his electoral success. His congratulatory tweet in Korea was hugely appreciated by Koreans and media. Reciprocating this gesture, President Moon sent his cultural minister, Chung Dongchea as special envoy to meet Prime Minister Modi in June 2017. Soon Moon made an announcement to elevate Korean relationship with India to the level of other four traditional partners-the US, Russia, Japan and China under “New Asia Community Plus Framework”.

Giving wings to his NSP, President Moon arrived in New Delhi on a four-day visit to India from July 8th to 11th. South Korean President last visited India in 2014 and considering the rapid geopolitical changes in the landscape of Northeast Asia and in Indo-Pacific region, such a high-level meeting is long overdue. Reiterating India’s keen interest to deepen cooperation with South Korea, Prime Minister Modi visited Seoul in 2015 and elevated bilateral ties to “Special Strategic Partnership”.

Historical Connect

India and South Korea have a historical partnership that dates back to over 2000 years. According to “The Heritage History of the Three Kingdoms or Samguk Yusa”, Princess of Ayodhya has travelled to Korea to marry King Kim-Suro and became Queen Hur Hwang-ok. Former Presidents, Kim Dae-jung and Kim Young-sam and former prime minister Kim Jong-pil trace their lineage to the royal couple. There are historical evidences of Korean travellers visiting India and vividly describing the country in their travelogues. Even Buddhism which originated in India is now practised by a majority of Koreans.

Contemporary relations

After World war-II, India helped Korea to conduct elections after independence in 1945. During the Korean war, both Koreas accepted the peace resolution proposed by General K.S. Thimmayya. He served as chairman of Neutral Nations Repatriation Commission (NNRC) and evolved a commendable solution for resolving humanitarian crisis after the armistice in 1953. India established consular relations in 1962 and elevated them to ambassador-level in 1973. Despite India’s contributions towards Korean war and armistice, India’s relations with ROK lacked an enthusiasm. Phenomenal economic growth of Republic of Korea (ROK) between 1963-79 transformed the country from rags to riches catapulting it to the club of wealthiest nations, OECD. By end of 1990’s ROK embraced democracy and India in response to marked globalisation introduced economic reforms and reoriented its foreign policy by launching Look East Policy. ROK’s transition and India’s push for open markets found a new congruence leading to fortification of bilateral ties.

Subsequently high-level exchanges and reciprocal visits of heads of states strengthened the relations. In 2006, President Abdul Kalam on his state visit launched Joint Task Force and laid foundation for Comprehensive Economic Partnership Agreement (CEPA) which operationalised in 2010. This accelerated the bilateral trade which crossed $20 billion mark, registering a 70% increase in a two-year period and prompted the leaders to set a target of $50 billion. However, trade registered a sudden decline with numbers slipping to $16.82 billion by 2016. By 2017, bilateral trade stabilized, and the Ministerial Level Joint Meeting recommended for an upgradation of CEPA.

In 2010, President Lee on his visit to India as chief guest for Republic Day Parade raised ties to Strategic Partnership. In a huge boost to energy cooperation, India sealed nuclear cooperation agreement in 2011. Strengthening bilateral ties further, in 2014 during President Park’s visit both countries signed “Joint Statement for Expansion of Strategic Partnership” encompassing maritime security and economic cooperation, counter terrorism. Laying firm foundation for strong Indo-Korean partnership, both countries established 2+2 consultation mechanism of foreign and defence Ministers. During his visit, Modi sought Korean investments under the Make In India initiative and collaboration in ship building, automobile, electronics, textiles, food processing. Korea pledged $10 billion towards infrastructure development like smart cities, railways and power generation. To boost investments India and ROK launched an initiative “Korea Plus” in January 2016. As of 2017, investments from industrial conglomerates like Samsung, LG, Hyundai Motors and other 500 Korean business establishments account for $4.4 billion, while Indian investments in ROK are to a tune of $3 billion.

Economic Cooperation

Moon’s visit to India marks 45 years of diplomatic relations. Economic cooperation has been at the core of Indo-Korean bilateral ties is at the top of Moon’s agenda. Korean economy which is export-driven is highly vulnerable to trade volatilities. Presently, Trump’s protectionist policies and the ongoing US-China trade war aggravated uncertainties in global trade. Volatilities of global market can blow a heavy blow to export-driven economies like ROK. In a bid to diversify its trade, ROK began to forge ties with developing economies of South East Asia and India, which has huge market potential. Korean industrial giants are making renewed push to expand their reach in Indian markets. President Moon, who termed India as “the next China” wary of China’s coercive diplomacy is wooing India. To this end, both countries finalized the “Early Harvest Package” that would lead to upgrade of CEPA. Under Early harvest package, ROK has pushed for early reduction of tariffs on 17 items. Both sides settled on 11 items. Leaders have even set the target of bilateral trade to $50 billion by 2030.

But domestic traders are not enthusiastic about this development since India exports raw materials and imports finished electronic goods. Bilateral trade is heavily tilted towards ROK and India currently runs a trade deficit of $12 billion, which is bound to increase if India opens economy further. As of now, India economy is not efficient to compete with the developed economies like ROK. While India ambitiously clinches deals on economic cooperation, its fails to stand up to the competitive markets of developed economy because of its incipient inefficiencies.

Having realised huge potential for growth in June 2017, Samsung announced plans to double its production capacity in India with an additional investment of Rs 4915 crores at Noida. This ambitious plan of Samsung led to the construction of one of the World’s largest mobile manufacturing unit, jointly inaugurated by Prime Minister Modi and President Moon on July 9th. 

MoUs signed

India and Korea signed 10 agreements covering a broad spectrum of areas including- trade remedies, artificial intelligence, internet of things, science and technology, rail research, biotechnology and bio-big data, information communication technology, MSME, skill development and cultural exchanges. Both sides, explored the possibilities of coordinating efforts in defence and strategic spheres including enhanced military exchanges. Disapproving Chinese assertion, leaders reaffirmed importance of freedom of navigation, overflight, unimpeded lawful commerce. India has welcomed ROK’s contribution towards total denuclearisation of peninsula. While ROK supported India’s membership to Nuclear Suppliers Group for strengthening international non-proliferation efforts. ROK is against any expansion of UNSC and bats for traditional setup because of its traditional rivalry with Japan.  

Strategic Cooperation

Despite India’s significant role in Korean peninsula in the aftermath of second world war, and its diplomatic ties with both Koreas, both India and ROK never made fervent attempts to forge strong strategic partnership. ROK has never been a priority for India’s Look East Policy and similarly Seoul with all its economic clout never looked beyond the realm of Northeast Asia. Shifting geopolitical landscape and palpable turbulence in traditional alignments has opened new vistas for cooperation. China’s crippling economic sanctions, its overbearing hegemony has thrown up new challenges prompting nations to expand bilateral strategic and defence cooperation. A growing consciousness of buttressing regionalism is resonating well with countries adding heft to the concept of Indo-Pacific cooperation.

Though India has elevated ties to special strategic partnership, both countries haven’t imparted any momentum to it. Giving impetus to bilateral cooperation, countries have now resolved to work together for global peace and prosperity. They have agreed to explore a tripartite partnership with capacity building projects in Afghanistan. Another point of considerable cooperation can be the vital linkages between North Korea and Pakistan which can be a plausible impediment in nuclear armament. Addressing this issue at the joint press meet, Modi said, “During our talks, I told President Moon that proliferation of linkages between Northeast Asia and South Asia (Pakistan) is matter of concern to India. Therefore, India is a stake holder in the peace process. We will ensure our bit to ensure peace”. India also promised to extend unwavering support to ensure permanent peace on Korean peninsula.

Back in 2017, when US forced India to stall diplomatic ties with North Korea, India refused the Rex Tillerson’s suggestion and Sushma Swaraj in a press meet clarified, “I told secretary Tillerson that embassies of some of your friendly countries should remain there so that some channels of communication remain open. Many times, you may have need to talk…. A mutual dialogue may be required to resolve some issues. At least one embassy should be there from your friends.” India expressed its intentions to play a role in denuclearisation of the Korean peninsula if need arises. Accordingly, commemorating 45 years of diplomatic ties, Minister of State for external affairs travelled to Pyongyang in May to hold talks with North Korean leadership.

Both leaders have discussed areas of convergence and affirmed interest in working together. With no outstanding territorial disputes/geopolitical baggage and robust economic cooperation in place, there is a great potential for expansion of strategic cooperation. During Moon’s visit both leaders met 10 times in four days, in a first, Modi received President Moon at Gandhi Smriti, hosted a dinner party for the couple, extended red carpet welcome and rode metro together. The visit which was high on photo-ops ended on positive note. Before leaving India, President Moon tweeted, “I spent four days in India among its kind, generous people. Living Gods appear to reside in their eyes, and Prime Minister Modi is a man who has known the value of harmony his entire life-just as India has throughout its history” leaving an indelible impression on Indian minds.

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