India-japan Infrastructure Cooperation: Progress and Challenges

Through infrastructure cooperation in the Indo-pacific, India and Japan are attempting to synergize their development policies and diplomatic strategies, with an eye to balancing China’s growing influence in the region. This has brought a new dimension to the China-india-japan trilateral relationship with implications for regional stability and development.

In recent years, India and Japan have moved closer in their cooperation on infrastructure construction. While India is eager to integrate its Act East policy, its Look West strategy, and the SAGAR (security and growth for all in the region) vision through cooperation with Japan, Japan is strengthening its ties with India under the Free and Open Indo-pacific Strategy, and in particular in its Partnership for Quality Infrastructure, in order to restrain and balance China’s influence in the region. In general, the infrastructure cooperation between India and Japan has brought a new dimension to the China-india-japan trilateral relationship and has implications for the stability and development of the entire region. Therefore, it is necessary to study the India-japan infrastructure cooperation systematically in order to learn from its experience and explore China’s own paths of cooperation.

Trends in India-japan Infrastructure Cooperation

In order to strengthen its infrastructure investment in Asian and African countries, Japan launched the Infrastructure System Export Strategy in 2013, the Partnership for Quality Infrastructure in 2015, and the Expanded Partnership for Quality Infrastructure in 2016.1 On the other

hand, after taking office in 2014, Prime Minister of India Narendra Modi began to reform the country’s economy, facilitating domestic infrastructure construction and cross-border transportation while forging ahead with his diplomatic agenda. In this context, India and Japan have been working together to plan and promote a number of joint infrastructure projects in South Asia, Southeast Asia, Africa and the Indian Ocean region.

South Asia

The two countries have a number of joint infrastructure projects in South Asia. First, Japan has been actively investing in India’s industrial corridors. Currently, five industrial corridors are under planning in India, including Delhimumbai, Chennai-bangalore, Bangalore-mumbai, Chennai-calcutta and Amritsar-calcutta, with the goal of building a huge diamond-shaped economic circle and thereby generating a greater economic capacity. While India is looking for funding to support the industrial corridors, Japan, under its Partnership for Quality Infrastructure, has invested heavily in related projects, including the Western Dedicated Freight Corridor,2 the Mumbai-ahmedabad high-speed railway, the Bangalore-chennai highway, and the industrial parks built around Chennai.3

Second, Japanese investment has been involved in infrastructure construction in northeastern India. In recent years, India has enhanced infrastructure buildup in northeastern states. Regarding development of the region as part of its Act East policy, the Indian government intends to build the northeast into India’s eastern gateway to Southeast Asia.4 India encourages Japanese investment despite its very strict policy of foreign investment in the northeastern region. As a result, the two countries now have a number of ongoing joint projects, including the expansion of National Highway No.54

in Mizoram State, the construction of National Highway No.51 in Meghalaya State, a forest management system in Sikkim State and Nagaland State, the Umiam Hydropower Station in Meghalaya State, and the Dhubri Bridge in Assam State.5 Some cooperation projects have even been extended to the border areas disputed with China.

Third, the two countries are cooperating in other South Asian countries. In 2018, India and Japan issued a joint statement during Prime Minister Modi’s visit to Japan, announcing that the two sides would cooperate in building roads and bridges between Ramgarh and Baraiyharat, and a railway bridge crossing the Jamuna River in Bangladesh, as well as infrastructure projects to develop liquefied natural gas in Sri Lanka.6

Southeast Asia

India and Japan are working together in building land and maritime channels to connect South Asia and Southeast Asia. First is the Mekong-india Economic Corridor. India and Japan are making efforts to integrate economic resources in the region by connecting land passages from Ho Chi Minh City, Phnom Penh, and Bangkok to Dawei of Myanmar, and maritime passages from Dawei to Chennai in India.

Second is the India–myanmar–thailand Trilateral Highway. India proposed building the highway to connect Moreh of India, Tamu of Myanmar, and Mae Sot of Thailand. People carrying passports or other travel documents from any of the three countries, and vehicles approved by the three countries are allowed to transit. In 2014, India and Japan jointly proposed the idea of an Asia Economic Corridor, with Japan providing loans to promote cross-border road renovation, and construction of bridges and ports in India, Myanmar and Thailand.7

Third is the development cooperation in Rakhine State of Myanmar. Rakhine State is rich in natural resources. Under the framework of the Kaladan Multi-modal Transit Transport Project, India has funded the construction of the Sittwe deep water port in Rakhine State. The shipping route from Sittwe to Kolkata of India has promoted the expansion of India-myanmar trade.8 On this basis, India and Japan will strengthen cooperation in housing, education and electrification projects in Rakhine.9

Africa

Infrastructure cooperation in the African region is a major direction of India-japan cooperation. First is the construction of the Mombasa Corridor. The Mombasa Corridor is a multi-modal transport trade route connecting the landlocked countries of the African Great Lakes region with the port of Mombasa in Kenya. It was built on the basis of the Northern Corridor Transit and Transport Agreement signed by Burundi, Kenya and Rwanda, and includes port construction, customs operation, railways, highways, waterways, and pipeline transportation.10 Japan provides loans to Kenya for the development and expansion of the Mombasa port, and supports the Master Plan for Development of Mombasa Special Economic Zone, the Comprehensive Development Master Plan in the Mombasa Gate City, the Master Plan on Logistics in Northern Economic Corridor, and the Mombasa Port Area Road Development Project.11 Since ancient times, the Mombasa Port has been in close contact with the ports in western India. When the East African Railway was built in the 1890s, an additional large number of Indian workers poured in and settled here. India’s societal and economic connection to Kenya has become a favorable condition for India-japan cooperation on infrastructure construction in East Africa.

Second is the project on capacity development for international trade facilitation in the Eastern African region. India-japan infrastructure cooperation in Africa focuses not only on hard but also on soft infrastructure, including one-stop registration, taxation, finance, trade and other services. At present, the two countries are trying to develop automated customs data management systems to address the problem of slow, time-consuming and costly African customs clearance systems.12

The Indian Ocean

In the Indian Ocean, India and Japan have strengthened their infrastructure cooperation and planned potential new routes to ensure the safety of sea passages. First is the cooperation to develop islands and ports in the Indian Ocean region. Japan will provide low-interest loans under the Free and Open India-pacific Strategy to ensure smooth navigation of the Indian Ocean and improve coastal defense capabilities at ports for relevant countries.13 Ports built by India and Japan include Matarbari in Bangladesh, Trincomale in Sri Lanka, and Chabahar in Iran. In addition, India and Japan have also cooperated in the development of outlying islands, including the Andaman and Nicobar Islands and the Laksha Islands. Among them, the Andaman and Nicobar Islands, which have important geo-strategic significance, are home a joint command for the Indian Army, Air, and Naval Forces.

Second is the planning for potential new routes in the Indian Ocean region. At present, there are two main passages for oil transportation in the Indian Ocean. One goes west of the Persian Gulf, passing the Cape of Good Hope in South Africa or through the Red Sea, the Suez Canal, to Europe and the United States. The other goes through the Persian Gulf to the east, crosses the Straits of Malacca or Lombok to the countries of East Asia.14 Two new potential routes have been

blueprinted in the Vision Document of the Asia-africa Growth Corridor. The first will connect the Jamnagar Port in western India’s Gujarat State and Djibouti, the strategic pivot of the Gulf of Aden. The other will link the Port of Mombasa in Kenya and the Port of Zanzibar in Tanzania with the port near Madurai in India’s Tamil Nadu State, and further to Kolkata and Sittwe.15

Motivations of India-japan Infrastructure Cooperation

The cooperation between India and Japan on infrastructure construction is driven by both economic interests and geopolitical and security considerations.

Harmonizing Indo-pacific visions to promote geopolitical transformation

With the increasing geo-strategic prominence of the Indo-pacific, India and Japan, as two major forces in the region, are steadily improving bilateral cooperation, and actively seeking multilateral cooperation with the United States, Australia and other countries.16 Japan is trying to strengthen its alliance with the US to cope with the geopolitical changes brought about by China’s rise, while actively advocating value-based diplomacy, strengthening relations with India, Australia and New Zealand, and building the so-called “Arc of Freedom and Prosperity.” In recent years, the US has emphasized India’s strategic importance in the context of Indo-pacific strategy, while Japan looks forward to playing a constructive role in the Indo-pacific order by strengthening cooperation with India. On the other hand, India, identifying itself as a great power and following the diplomatic tradition of non-alignment, has for long carefully avoided getting too close to the US and its ally Japan. However, it has now begun to rethink its relations with Japan in the face of China’s rise and