Event ReportsPublished on Feb 21, 2015
With the rise of China as an economic and military superpower, the significance of Myanmar in the geo-politics of the region has assumed new dimensions. India therefore cannot continue to turn a blind eye to the country where till recently Chinese influence was allowed to grow unchallenged.
Rise of China has upped significance of Myanmar
It is very important to take into account political rationale, economic rationale and sustainability when any connectivity project is envisioned, according to Mr. Aloke Sen, former ambassador to Myanmar. Delivering the keynote address at the two-day Consultative International Workshop on Proximity to Connectivity: India-Myanmar in Perspective, organised by Observer Research Foundation, Kolkata on February 16-17, Mr. Sen highlighted the need to be rational and discerning when examining the prospects and viabilities of connectivity projects and observed that such projects should not exist to serve third country interests. The workshop was part of a project on ’Proximity to Connectivity: India and her Eastern and Southeastern Neighbours’ of which the second and current phase centers on issues of connectivity between India and Myanmar. The workshop was divided into four business sessions, each focusing on a specific mode of connectivity between the two countries.

Proximity to Connectivity: India-Myanmar in Perspective

The first business session of the workshop dealt with ’Enhancing Physical Connectivity’ between India and Myanmar. Understanding that India and Myanmar are yet to seize their geographical advantage which offers enormous potential for overland and maritime connectivity including road, rail and waterways, there is an urgent requirement to define, more specifically, what the objectives of the connectivity projects between these two countries are. For instance, it is not very relevant to discuss development corridors through India’s northeast into Myanmar, when there are hardly modern roads connecting two towns or cities between the two countries. The fact that effective implementation of connectivity projects continues to remain a major challenge; this further stresses the need for new approaches to overcome existing issues. Both countries also should take into account security and stability at the borders and design their policies accordingly. Utilising Track II diplomacy to find solution to problems and sort out existing challenges could provide further scope for engagement. Understanding the motivations behind connectivity endeavours is also important in ascertaining the objectives of such endeavours. The second business session looked at the challenges and possibilities of ’Border Trade and Border Management’ between the two countries. It was underlined that the development of India’s North-Eastern Region (NER) has long been a major challenge to the policy makers at the State and the Centre with the peripheral geographical location of the region standing in the way of progress. Nevertheless as the geo-economic importance of the borders has come to the fore relegating geo-political considerations somewhat into the back seat, there could be immense possibilities for the development of the NER as it shares 98% of its borders with neighboring countries. Additionally, with the rise of China as an economic and military superpower, the significance of Myanmar in the geo-politics of the region has assumed new dimensions. From the point of view of its own strategic and economic interests, India therefore cannot continue to turn a blind eye to the country where till recently Chinese influence was allowed to grow unchallenged. The importance of India’s Look East Policy, and with it the significance of the Northeast on this emergent strategic map, demand fresh assessment and evaluation. The third business session was primarily focused on the aspect of energy cooperation as the bedrock for strong relations between India and Myanmar. It highlighted the importance of reliable energy supply and universal access in achieving a country’s developmental goals. The details about India’s current energy situation with reference to India’s North-East were discussed. The session not only explored the opportunities in terms of traditional forms of energy, but also focused on large and decentralised renewable energy cooperation. It was highlighted that if Myanmar has to become an equal partner in the international community, then it is essential for the country to attract large volumes of inward investment. In this regard, energy and mining have been identified as the potential areas for investment and could account for a sizeable proportion of the country’s total growth and employment potential. In order to achieve energy connectivity between India and Myanmar both the countries have to explore the feasibility of exchanging electricity between the two regions. The basic problem lies in the Myanmar’s tariff policies, and in order to resolve this hurdle political will is essential. The final business session on the second day of the workshop, focused on India’s investment in Myanmar and whether there are any scope and possibilities for further investments by India in Myanmar. India is perceived as an argumentative and less competitive country by Myanmar. Myanmar has always felt that it is not easy to deal with India. In terms of economic relations India is Myanmar’s third largest trade partner. India has a trade deficit with Myanmar. The session highlighted that given Myanmar’s poor infrastructure; India should invest in the country’s infrastructural development. India has already invested in Myanmar’s timber industry with six Indian companies investing in this sector. The telecommunications and tourism industry in Myanmar also receive a high percentage of investments from India. Indian companies can invest in fertilizer industries, chemical, hospitals and pharmaceutical industries in Myanmar in addition to infrastructure and real estate. In terms of economic relations, India is Myanmar’s third largest trade partner. If India wants connectivity to fulfill economic goals then it should invest in expanding the road network connect Mandalay and Yangon, both of which are key centres of economic activities. This is also why it is difficult to mobilize human resources and manpower for economic investment in other parts of Myanmar, as the skilled labour is concentrated in Mandalay and Yangon. The primary hurdle in terms of foreign investment is the political and economic transition that the country is undergoing. (This report is prepared by Pratnashree Basu, Junior Fellow, with inputs from Sriparna Pathak Raimedhi, Associate Fellow, Mihir Bhonsale, Research Assistant, Garima Sarkar, Natasha Sharma and Priyanka Dey, Research Interns, Observer Research Foundation, Kolkata)
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