RECENT DEVELOPMENT OF INDIA-ASEAN RELATIONS

The Phnom Penh ASEAN Summit held in November 2002 can be regarded as a watershed, which divides the development of India-ASEAN relations into two phases.

In the first phase, India-ASEAN relations were mainly tentative and partial. India at this time focused largely on building up her relations with individual ASEAN countries, with different emphases and values for each. For example, in the trade, investment, and science and technology R&D dimension, New Delhi had stronger relations with Singapore, Thailand and Malaysia; in the defence and strategic dimension, India put much stress on her relations with Vietnam and Myanmar; in the area of natural resources cooperation (with energy cooperation in particular), India paid much attention to her relations with Indonesia, Malaysia and Myanmar; while with regard to security cooperation, especially in combating cooperatively against antigovernment forces, India attached great importance to her relations with Myanmar and Vietnam. Besides, India has selected Myanmar and Indochinese countries to be its major recipients of economic assistance.

The most outstanding feature of India-ASEAN relations in the first phase is the focus on economic cooperation and trade promotion. From a Sectoral Dialogue Partnership established in 1992 to a Full Dialogue Partnership established in July 1996, building up close and powerful economic and trade relations and mutual investment had always been the priority between India and ASEAN countries. Thanks to such efforts, bilateral trade and investment had increased rapidly in the first phase. The bilateral trade volume had increased by 16.5 per cent annually, from US$2.9 billion in 1993 to US$9.9 billion in 2001. The investments from ASEAN countries also steadily rose to nearly 15 per cent of the total approved investments in India in 1995. According to India Investment Centre statistics, Indian joint ventures in ASEAN in 1996 numbered 118, with Indonesia 18, Malaysia 39, Singapore 37, and Thailand 24.

During this phase, 1996 was a landmark year for Indo-ASEAN cooperation. In July 1996, at the Fifth ASEAN Summit, India became simultaneously a Full Dialogue Partner as well as a formal member of the ARF at the summit held in Jakarta, Indonesia. The entry into ARF put India at par with Western countries and China vis-à-vis ASEAN regional security, and economic and political arrangements.