Originally Published 2017-02-10 05:14:49 Published on Feb 10, 2017
India - the bridge linking South and Southeast Asia

In the last decade Asia’s growth trajectory has perceptibly shifted the global balance away from the western economies towards the Asian economies. Several significant studies have predicted the rise of Asia, and today it is recognised as an important player and an economic powerhouse. With a group of large, medium and small nations increasingly able to generate noteworthy development, and attract international investment, the Southeast Asia region has emerged as a significant economic group on the Asian map. But these expanding economies have not been confined to their borders; inevitably the contiguous South Asia region was part of the phenomena too. South Asia in the meantime was recording its own growth graph, and realised the rich potential offered by its neighbouring region.

This paper starts by briefly tracing the state of regionalism in South Asia and Southeast Asia. The next section examines the extent of physical connectivity that exists in India vis-à-vis South and Southeast Asia. It then goes on to highlight India’s position with regard to facilitating connectivity projects between the two regions and conclude with the challenges that India will need to overcome in order to transform itself into a dynamic bridgehead.

South and Southeast Asia Regional Economic Cooperation

The adjacent regions of South Asia and Southeast Asia have had deep historical links since ancient times, with established routes for the movement of goods and services, along with people. The trans-boundary connections had facilitated intersections of ideas, arts and sciences. Apart from commodities along the spice, silk and tea routes, religious influences were also carried across this region. Indeed both overland and maritime routes were used with varied efficacy over the past centuries. But with the passage of time and the establishment of European colonialism, cross boundary linkages become tenuous. SA and SEA interdependency decreased and new alignments came about, diluting cross border and regional linkages.

Developments in the 20th century led to dramatic changes on a global scale. In the aftermath of the World Wars II the deeply impacted international community became sharply polarised. Even within Southeast Asia, the Cold War divided the region along the two power blocs of the post-war period. It was only in 1967 that the five states of the region (Indonesia, Malaysia, the Philippines, Singapore, and Thailand) got together to form a regional forum, ASEAN, which later expanded to ten members, including Brunei Darussalam in the 1980s and  Laos, Cambodia, Myanmar and Vietnam in the 1990s. These Southeast Asian states began to seek a joint platform for common issues, and regionalism began to germinate. The post-colonial period was critical for the newly emerging South Asia states too. Nation-building tasks and bilateral endeavours became the focal issue for them. Regionalism and inter-region cooperation was a distant concern for these newly independent states. Arguably, regional developments in South Asia, unlike in other regions, caused the threat perception emanating from within the region to dismiss the idea of a common platform. Indeed, the earlier physical connectivity that the region had enjoyed was broken off with the partition of the Indian sub-continent and subsequent break-up of Pakistan. The South Asia regional forum, i.e. South Asian Association for Regional Cooperation (SAARC), proposed by Bangladesh, was finally established only in 1985. However, while Southeast Asian countries have increasingly realised the efficacy of regional approaches to accomplish their development goals, SAARC’s achievement has been limited. Its intra-regional trade is far below the expected levels, its infrastructure development remains low and intra-regional connectivity is under developed. As succinctly summarised in the recent Asia Foundation report:

It is currently one of the least integrated regions in the world in terms of trade, infrastructure, water, and energy cooperation. Some progress has been made through regional arrangements such as the South Asian Association for Regional Cooperation (SAARC), the agreement on the South Asian Free Trade Area (SAFTA), and several bilateral agreements, but trade connectivity is below what is necessary to unlock the region’s potential for prosperity....<1>

Given the political differences within South Asia, the common platform of SAARC could never be fully optimised for regional economic growth and development. The lack of political consensus ensured that the economies remain disconnected. Unavailability of cross-border connectivity services made intra-regional cooperation almost stagnant. But given the spurt in economic cooperative initiatives that were being undertaken by regions across the globe, SA did not remain immune to the momentum and in recent years there has been an improvement in developing cross-border overland infrastructure. Limited bilateral agreements have taken place, but several connectivity projects at the sub-regional levels are yet to become operational. In fact while the significant motor vehicles act (MVA) has been signed amongst the four-nation sub-regional group of Bangladesh, Bhutan, India, and Nepal (BBIN) it has not moved beyond the trial run till present, February 2016. In contrast, Southeast Asia, successful in establishing the ASEAN Economic Community (AEC), a single regional market for goods and services, was looking increasingly attractive. The AEC, the third largest economy in the world, represents a USD2.6 trillion market.

There are clear imperatives for the two regions of South and Southeast Asia to engage closely:

With a combined population of more than 1.7 billion in ASEAN and South Asia, integrating ASEAN and South Asia can have profound implications for Asia as well as the world as a whole. The countries of these two regions are very diverse in all aspects. In terms of demographic size, countries vary from highly populous, such as India (nearly 1.2 billion in 2009) and Indonesia (nearly 238 million) to very small ones such as the Maldives (0.31 million) and Brunei Darussalam (0.39 million).…..The different stages of development of these countries are also reflected in their performances in trade in goods and services, FDI inflows and outflows as well as annual consumer price inflation rates. This diversity could be a great opportunity for growth and development if proper cooperation and integration can be achieved among these economies.<2>

India’s Look East Policy, launched in the early 1990s, deepened her ties with SEA, especially ASEAN. India became a sectoral partner of ASEAN in 1992, a dialogue partner in 1996 and a summit level partner at Phnom Penh in 2002. India’s participation in several ASEAN-led institutions like ASEAN Regional Forum (ARF), East Asia Summit and ASEAN Defence Ministers’ Meeting Plus are all a reflection of this deepening of ties. India has interacted with the Association on various issues, from economic exchange to counter-terrorism measures. Both sides have strengthened their cooperation via the ARF and the EAS. During his recent participation at the ASEAN Summit 2015, Prime Minister Modi emphasized India’s active participation in the ASEAN led security dialogue. While some have argued that India has been able to engage deeply with the Southeast Asia region, its physical connectivity has been tenuous. It is also relevant to remember that India is really the bridgehead that connects the two regions of South Asia and Southeast Asia.

India - the Bridge between South Asia and Southeast Asia

Geographically, India is strategically positioned in SA. It is the only state to enjoy direct physical contact with all the states in the region. Its central location within the region allows it to be the bridge between the SA economies such as Bangladesh, Pakistan, and Sri Lanka and the SEA economies. Nepal and Bhutan, the two landlocked states, also can access the SEA region through India.

Over the years there have been several sub-regional initiatives linking up the two regions. South Asia Sub-regional Economic Cooperation (SASEC), Bay of Bengal Initiative for Multisectoral Technical and Economic Cooperation (BIMSTEC), ASEAN+1, and the Bangladesh-China-India-Myanmar (BCIM) initiative all have India as a common factor. Not only India, other SA states have also been increasing their linkages to the SEA region. Indeed, as has been argued, ‘trade integration through ASEAN + India FTA and bilateral FTAs such India-Singapore, India-Malaysia, Pakistan-Malaysia will include the service sector and eventually the agricultural sector. Free movement of goods, services, labour, knowledge and capital within ASEAN and South Asia will pave the way for an Asian common market.’<3>Developing economic and connectivity linkages between South and Southeast Asia seems a natural and progressive move towards growth and prosperity. The trade linkages and connectivity between the regions are through land borders, maritime routes and air connections.

Land Connectivity through India’s Northeast

Given the course of the region’s history, borders are viewed more as barriers than windows of opportunity and possibility, and have long remained stagnant.<4>With the maturing of the economies it was reasoned that ‘these economies need to remove border barriers to realize the full impact of integration.’<5> As also highlighted in a World Bank study, for SA to be a leading sub-region in global trade, it is essential for South Asia to reduce the cost of doing business. The issue is the cost of transport – and time is a major component of that cost.<6> Over the last few years bilateral agreements on cross border connectivity have taken place but have not extended to multilateral levels. It is only recently that the idea of cross border connectivity at a sub-regional level was envisaged. Although India’s Look East policy was initiated in 1990s it has found greater significance in recent times and coincided perhaps with the suggestions of US secretary of state Hillary Clinton to India “not just to look East, but to engage East and act East.”<7> India’s focus towards its east has been the precursor to many of its connectivity projects. The MVA signed in 2015 will now facilitate the seamless movement of passengers and goods through the signatories’ land borders. This agreement will not only reduce transport cost but will also enable better connectivity and growth of regional trade. This agreement will be a force multiplier with the multi-modal transport and transit facilities that are being discussed at various sub-regional levels simultaneously. Access being allowed to Chittagong port to India by Bangladesh will lead to greater connectivity and enhanced trade movement. Given the geography of the region, India’s land connectivity with Myanmar or Southeast Asia was only possible through its Northeast region. Thus the issue of South-Southeast land border connectivity is directly linked to India’s Northeast states with common borders with Myanmar and Bangladesh. Indeed several of the connectivity projects of the region will also connect with the Asian Highway and the various Asian Development Bank projects that are underway. However, the physical connectivity status between South and Southeast Asia needs further examination.

From Bilateral to Multilateral connectivity

The changing political landscape in both of India’s eastern neighbours has led to positive bilateral relations and also opened up the scope of increasing the connectivity linkages to include sub-regional levels. Thus, possibility of a similar agreement amongst India, Myanmar and Thailand is now being discussed. The 1,360 km long road between Moreh- Mae Sot will pass through Mandalay and link Northeast India and Southeast Asia. This route could then easily connect with the Kaladan Multi-modal transit project that would link Kolkata port with landlocked Mizoram via Myanmar into economic highways with special economic zones.

None of the three sub-regional initiatives undertaken to enhance road connectivity between India and the Southeast Asia region, namely the Mekong-India Economic Corridor, Bangladesh-China-India-Myanmar (BCIM) Economic Corridor, and the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) has as yet resulted in any tangible progress. BCIM Forum for regional economic cooperation was drawn up to boost trade and economic activities in the sub-region stretching from southwest China to eastern India to Myanmar, India’s Northeast and Bangladesh. The main artery of the 2,800-km K (Kolkata)-2-K (Kunming) corridor is nearly ready. A stretch of less than 200 km, from Kalewa to Monywa in Myanmar, needs to be upgraded to an all-weather road apart from a short segment in India’s Northeast region that needs upgrading. Apart from the infrastructural issues this route poses political and security problems as it enters insurgency related issues.<8> Also, as pointed out, China was keen to draw Mizoram into the framework through the Kaladan multi-modal transit transport project. Under this plan, Mizoram would be connected with Myanmar’s port of Sittwe through the Kaladan River, and the passage would provide all the landlocked north-eastern States access to the sea.<9> Indeed the Rhi-Tiddim (80.178 km) and Rhi-Falam (151.5 km) roads connecting Mizoram with Myanmar’s bordering Chin state and onto Mandalay are other identified potential routes to boost bilateral trade. The double lane hilly road stretch from Aizawl to Zokhawthar is in better condition, although trade through this route is extremely limited. Although the Zokhawthar Land Customs Station has been operationalised, the weighbridge poses a challenge: headloads are the only means for goods to move across. However if the route from Aizawl to Agartala is improved, and the transit trade through Bangladesh is realised, this will become the shortest land route connecting Myanmar and Kolkata. For the Kaladan Multi-Modal Project to be fully effective, connectivity from Sittwe Port, Myanmar up to Silchar is imperative. Indeed, the Manipur connectivity with Myanmar through the Moreh-Tamu-Kalewa-Kalemyo road is fully operational. But problems of maintenance continue to plague the route and this, coupled with security issues, have slowed down traffic considerably. The Avakhung land custom station in Phek district Nagaland has been identified as a border trading point with Myanmar, but as yet there is no progress on this front.

India in the meantime had decided to improve the 57 km of the old WWII Stilwell road from Lekhapani in Assam to Pangsu Pass on the Indo-Myanmar borders, although the roads on the Myanmar side too would need to be restored to make it operational. In keeping with India’s reformulated Act East Policy, Union Commerce Minister Nirmala Sitharaman states that “the Government of India has accorded high priority to economic engagements with the four countries, and is working towards establishing seamless physical connectivity with the region”<10> but the proposal to connect with the four Mekong countries, namely Myanmar, Laos, Cambodia and Vietnam, which will invariably involve India’s Northeast region, also poses several challenges for quick implementation.

There certainly is a buzz at the moment about the imperative to improve physical connectivity, but NE throws up several challenges to the optimisation of its potential at the present level of development. Clearly, the two large issues that remain unresolved- of terrain and security - will prevent any large proposal from being fully implemented. The undulating, hard-to-traverse terrain makes it time consuming and difficult to build adequate infrastructure to support international trade. Maintenance is equally daunting in the face of harsh climatic conditions, and is often the cause of movement delay and loss of revenue. Even where infrastructure is in place, trading points are under-utilised due to various domestic compulsions and unrealistic policies. At present the basket of goods that are exported to SEA has very little contribution from the Northeast region. The type of goods that are allowed across the border is limited and non-reflective of the demands on the ground. This region will initially be a transit point before it begins to enjoy the spinoffs of trade and transport movement and becomes closely integrated with the entire cross border process.

The intricacies of Centre–State political dialogue in India have not been able to provide stability to the turbulent Northeast region, which continues to pose challenges and, as succinctly stated, ‘while transport connectivity is crucial for eastern South Asia, the achievement of significant developmental outcomes has been hampered because the facts have weighed less than the outdated attitudes of decision-makers in some segments of the region.’<11> Thus the idea of creating a connectivity cobweb linking the South Asian Corridors and the Asian Highway network will need to be translated into a functional pathway before it can yield the results of cross border linkages.

Maritime Link

Clearly the potential for road connectivity between South and Southeast Asia is huge. Yet it remains in the realm of possibility only. For the connectivity network to be complete the wide road network needs to be linked with the maritime routes to ensure seamless movement of cargo, trade and transportation. According to a RIS report, nearly 95 per cent of India’s merchandise trade by volume (70 per cent by value) is moved by sea.

India’s maritime connectivity with Southeast and East Asia, although presently limited, can be the facilitator of pan-Asian integration. The report also notes that despite having one of the largest merchant fleets in the developing world, Indian ports have a limited number of direct calls with ASEAN ports. Also, given Myanmar’s direct coastline with India and Southeast Asia, developing infrastructure along the coast of Myanmar seems imperative to India’s engagement with the Southeast Asia region. While India is rebuilding a port at Sittwe in Myanmar under the Kaladan Multi-modal Transit Transport project, it could also explore developing the Dawei port and SEZ project in Myanmar.<12> The Indian governmental position echoes this:

Government of India is committed to working towards a more integrated South East Asia and close-knit relations amongst the ASEAN countries. The country is also invested in enhancing connectivity across all dimensions: physical, institutional, and regional…. India has maritime boundaries with many ASEAN countries. Enhancing this connectivity with the ASEAN community as well as the rest of South East Asia is a strategic priority. <13>

In fact at the India annual meeting with the ASEAN Connectivity Coordinating Committee (ACCC) in 2013, India had suggested setting up a Joint Working Group (JWG) on Maritime Connectivity between India, Myanmar, Thailand, Cambodia and Vietnam which would examine the need to create soft infrastructure in order to permit seamless movement of goods and passenger traffic along the ASEAN-India connectivity corridors.<14> India had also initiated a study on a Mekong-India Economic Corridor. Conducted by the Economic Research Institute for ASEAN and East Asia (ERIA), it was to examine the production networks in the Mekong region along the Greater Mekong Sub region or GMS Southern Economic Corridor (Ho Chi Minh City-Phnom Penh-Bangkok) to the corridors in India (Delhi-Mumbai-Industrial Corridor and Mumbai-Bangalore-Chennai Industrial corridor) through the Chennai-Dawei Sea link. There is even broader potential to linking trade routes from sea ports in Myanmar, Thailand, Cambodia and Vietnam and even Japan to ports along India’s eastern seaboard.<15> The connectivity through India between South and Southeast Asia will be fully effective when maritime and rail links are complete for cargo and passenger movement. The railway link through India’s Northeast is the weakest link between the two regions.

Railway Network

The terrain of India’s Northeast is a challenge for establishing railway links. So while India has one of the world’s largest railway networks, the NE region has limited railway links with other parts of India. Prime Minister Modi has recently flagged a large connectivity network in this region and while the Indian Railways intends to connect all state capitals in the Northeast region by March 2020, the gaps in the network are rather wide at present.<16> Indeed the recently commissioned (March 2015) 120 km Lumding-Silchar broad gauge line connecting Barak valley in South Assam with Tripura, Manipur and Mizoram for goods movement is yet to be declared safe for passenger travel. This line sometime in the future will also link with Agartala, Tripura and. More significantly, the planned 15.06-km line between Agartala and Akhaura in Bangladesh connecting West Bengal with Tripura will also then provide cross border linkages with Tripura and the entire Badarpur-Lumding-Guwahati-Siliguri route.

In order to establish a cross border link with Myanmar, Indian Railways is surveying a possible route from Sairang to Hmawngbuchhuah on Mizoram’s southern tip, bordering Myanmar’s Rakhine state. Hmawngbuchhuah neighbours Zochachhuah. The railway line under discussion will link up with the yet to be completed Kaladan Multi-Modal Transit Transport Project. This project has also been faced with inordinate delays and shifting deadlines.<17> Unfortunately, the latest India Railway budget (Feb 2016) also paid scant attention to improving Northeast railway connections.

Geographical and security issues continue to hinder infrastructure development and its sustenance. For the same reasons airport links have also been difficult to build in the region. Limited International flights are now operational from Guwahati but most of the cities are not connected by air links.

India’s Northeast region, although a critical connecting link between South and Southeast Asia, is clearly beleaguered with security issues, economic stagnation, and poor infrastructure. While India’s Look East Policy has made tremendous progress, it has bypassed the Northeast region. The Act East policy was meant to perhaps redeem that. Plans and proposals are in place and the possibilities of building a cobweb of connectivity networks through India and its Northeast region is high. But given India’s implementation track record, how soon it can be the real bridge between South and Southeast Asia is still an open ended issue.

This article was originally published in GP-ORF’s Emerging Trans-Regional corridors: South and Southeast Asia

<1>Report: Intra-Regional Trade in South Asia, Asia Foundation, February 2016 at http://asiafoundation.org/resources/pdfs/IndiaRegionalTrade.pdf

<2>B.N. Bhattacharya, ‘Prospects and Challenges of Integrating South and South East Asia’, International Journal of Development and Conflict, 4 (2014), pp. 40–66 at http://www.ijdc.org.in/uploads/1/7/5/7/17570463/article_3.pdf

<3> Ibid.

<4> Sreeradha Datta, ‘India Bangladesh Boundary Agreements: Follow up concerns need fair approach,’ ISAS Working Paper , No. 219 – 12 January 2016 at http://www.isas.nus.edu.sg/ISAS%20Reports/ISAS%20Working%20Paper%20No.%20219%20-%20India-Bangladesh%20Land%20Boundary%20Agreement.%20Follow-up%20Concerns%20Need%20a%20Fair%20Approach.pdf

<5> B.N. Bhattacharya, ‘Prospects and Challenges of Integrating South and South East Asia’, International Journal of Development and Conflict.

<6> Shamshad Akhtar, “Seamless Connectivity for Shared Prosperity in South Asia” Speeches Delivered at the Asian Institute of Transport Development (AITD) in New Delhi, India on 3 February 2015 at http://www.unescap.org/speeches/seamless-connectivity-shared-prosperity-south-asia-and-beyond

<7> Sangeetha Kandavel and Joe A Scaria, “Look East, and act East, too: US Secretary of State Hillary Clinton to India,” The Economic Times, 20 July 2011 at http://articles.economictimes.indiatimes.com/2011-07-20/news/29794815_1_state-hillary-clinton-india-asia-pacific-region

<8>Atul Aneja, ‘China, India fast-track BCIM economic corridor project’, The Hindu, June 26, 2015

<9> Ibid.

<10> Press Release, Ministry  of Commerce & Industry, 11 December, 2014, at http://pib.nic.in/newsite/PrintRelease.aspx?relid=113100

<11> Ram Upendra Das, Nitya Batra, “Fresh Perspectives needed to boost South Asian Connectivity”, East Asian Forum, 21 February , 2015 at http://www.eastasiaforum.org/2015/02/21/fresh-perspectives-needed-to-boost-south-asian-connectivity/

<12> Report, ‘ASEAN-India Maritime Connectivity Report’, RIS, New Delhi, 2014 at http://www.mcrg.ac.in/Logistics/Report_Final_Print_Martitime_connectivity.pdf

<13> Anil Wadhwa, Secretary (East), Ministry of External Affairs, GoI, quoted in ‘Report: India’s Look East - Act East Policy: A Bridge to the Asian Neighbourhood’, IRC 2014,  Symbiosis Institute Of International Studies, Symbiosis University, Pune, 2015

<14> Report, “Promoting International Transport corridor between India and Southeast Asia”, National Transport Development Policy Committee, Vol 2. (2), 2013  at http://planningcommission.nic.in/sectors/NTDPC/voume2_p2/promoting_v2_p2.pdf

<15> Ibid.

<16> “Northeast capitals to get rail link by 2020”, The Hindu, January 14, 2016, at http://www.thehindu.com/todays-paper/tp-national/northeast-capitals-to-get-rail-link-by-2020/article8103994.ece

<17> Samudra Gupta Kashyap & Adam Halliday, “Massive push to railway infrastructure under way in Northeast,” The Indian Express, July 2, 2015 at http://indianexpress.com/article/explained/the-new-northeast-expresses/#sthash.L2r69MXc

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