Even as Malaysian Prime Minister Najib Razak on his just-concluded India visit was urging Malaysian companies to tap India’s burgeoning middle-class once the services and investment sectors between Asean and India were liberalised, US experts on Asia sharpened their gaze on the happenings in New Delhi, where Asean leaders descended to attend the two-day gargantuan India-Asean Commemorative Summit marking two decades of India-Asean relations.

The summit was also widely reported in several US newspapers, including the Wall Street Journal which has an Indian edition.

The US interest in India is currently high-pitched; Washington has been encouraging the economic integration not only within South Asia but also with the Asean group which has achieved a high level of integration in Southeast Asia.  

South Asia’s economic regional cooperation, through the regional association known by the acronym SAARC, has remained what is called a "still-born child" since its birth in 1985.

But India, as SAARC’s largest member, has evolved into one of the world’s most dynamic –- though challenging -- markets, with a population of 1.2 billion people, of which nearly 400 million are cash-flushed middle-class consumers who can afford luxuries of a modern consumer society.

Najib, as one US observer told Bernama in New York on the condition of anonymity, made "all the right sounds" in New Delhi.

US supports FTA

The US administration is particularly encouraged by the finalisation of the Asean-India Free Trade Agreement (FTA) in the services and investment sector, thus liberalising sub-sectors such as healthcare, tourism, transportation, tourism and travel-related services, pharmaceuticals and biotechnology.

The FTA will be signed in August next year.

India’s integration with the Asean group is also vital for US interests in the Asia Pacific region where Washington is going to increase its presence, obviously, in response to China’s growing economic and military ambitions.

The India-Asean resources embrace roughly 1.8 billion people and a combined gross domestic product of US$3.8 trillion –- these are staggering figures that are inherent with tremendous potential for business and strategic cooperation.  

While India has so far remained lukewarm to Asean’s call to play a greater role in Beijing’s territorial dispute with a number of Asean member states in the South China Sea, Washington has noted with interest that India and Asean have agreed to strengthen cooperation on maritime security to safeguard freedom of navigation and sea lanes of communication for unfettered movement of trade in

accordance with international law, including the United Nations Convention on the Law of the Sea (UNCLOS).

Washington noted with interest the Vietnamese Prime Minister Nguyen Tan Dung’s call to India to support Asean "in the full implementation of the declaration on the conduct of parties in the South China Sea and the Asean Six-Point Principle on the South China Sea in order to settle the dispute by peaceful means on the basis of international law, particularly the 1992 UNCLOS".

Afghan withdrawal

The New Delhi summit is also in sync with the "new strategic thinking" that has been recommended to the US administration in regard to Asia, integrating South Asia in the long-term Asia strategy, especially after US troop withdrawal from Afghanistan in 2014.

Indeed, the Asia Society in New York recently organised a discussion over the launch of a study report titled "The United States and South Asia after Afghanistan" prepared by Alexander Evans, a former British diplomat in Islamabad and New Delhi, and a senior advisor to the late Ambassador Richard Holbrooke.

The report recommended a long-term strategy for Asia, making South Asia an important component of this policy.

But India, as the leading SAARC member, has been extending its relations eastwards beyond its regional sphere of influence in the SAARC context.

SAARC’s progress, if any, has been minimum, thanks to the rivalry between India and Pakistan.

Indeed, some Indian strategists even talked at one point of disbanding SAARC and joining the Asean group, inflating it to a larger entity called the Asesan, translating as the Association of Southeast and South Asian Nations.

Encouraging trade

While addressing the Asia Society, Robert D Hormats, the US Under Secretary of State for Economic Growth, Energy and the Environment, who has held senior positions in the administration, including that of the Deputy US Trade Representative, described South Asia as the "economically least integrated region in the world", saying that its level of integration was even less than

that of African countries, not to mention the European Union and the Association of Southeast Asian Nations (Asean).

"However, South Asia is also inherent with tremendous potential in the future...It must be remembered that this area once was a very prosperous part of the world because of interconnectivity," Hormats said.

Hormats also spoke of an Indo-Pacific Corridor that reaching out to Southeast Asia, making it a hub for global trade.

This prospective Indo-Pacific Corridor would get a strong impetus from increased India-Asean cooperation, as articulated at the New Delhi summit.

Frank Wisner, a former US Ambassador to India, emphasised the strategic role India has assumed as a partner for the US in Asia; indeed, some experts see India as a potential counterweight to China.

There is already deep-rooted resentment and suspicion amongst the Asean members against China which has increased the presence of its patrol vessels in the South China Sea to enforce its claims to the disputed islands in the region and thus create a fait accompli situation in China’s favour.

The issuance of Chinese passports by Beijing with sketches depicting the disputed islands as "integral territory" of China, has further heightened tensions.

- Bernama