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India-Malaysia Relations

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India-Malaysia Relations India-Malaysia Relations India established diplomatic relations with the Federation of Malaya (predecessor state of Malaysia) in 1957. India is represented in Malaysia through the High Commission of India based in Kuala Lumpur. Malaysia is represented in India through their High Commission in New Delhi and Consulates General in Mumbai and Chennai. India - Malaysia have traditionally been close and friendly. There have been regular Summit level exchanges and meetings, the most recent of which was the visit by Prime Minister Dr. Manmohan Singh to Malaysia from 26 to 28 October 2010. This followed the landmark State visit to India in January 2010 of Malaysia’s Prime Minister Mohd Najib. Foreign Ministers of both countries head the Joint Commission, which held its 5th meeting in Kuala Lumpur on 3 rd May 2011. Other high level Ministerial visits from India in 2010 – 2011 include those by Dr. M.S. Ahluwalia, Deputy Chairman, Planning Commission in September 2010, Shri Kamal Nath, the Minister of Road Transport and Highways in December 2010, Shri Anand Sharma, the Minister of Commerce and Industry in February 2011 to sign the Comprehensive Economic Cooperation Agreement (CECA), and the External Affairs Minister of India in May 2011. Dr. Farooq Abdullah, Minister for New & Renewable Energy, visited Kuala Lumpur on 8-10 September, 2011, to attend the Roundtable Meeting of 1st International Greentech & Eco Products Exhibition & Conference (IGEM 2011). Ms. Panabaka Lakshmi, Minister of State for Textiles visited Malaysia on 20-23 November, 2011, to inaugurate the INTEXPO Textile Exhibition at the INTRADE 2011 exhibition organized by Malaysia External Trade Development Agency (MATRADE). Malaysian Deputy Prime Minister Tan Sri Muhyiddin Yassin paid an official visit to India (Mumbai, Delhi and Chennai) from 8 to 13 March 2011. He paid a courtesy call on Prime Minister Dr. Manmohan Singh, and met External Affairs Minister, Minister of Road Transport and Highways and Minister of HRD. Malaysian Minister for Science, Technology and Innovation visited India from 21 to 22 February 2011, Minister of Health on 4 March 2011 and Minister for International Trade and Industry from 2 to 4 March 2011. Prime Minister’s Visit to Malaysia : During the visit of the PM Dr. Manmohan Singh to Malaysia from 26 to 28 October 2010, India and Malaysia have agreed to work on a Framework for Strategic Partnership, which envisions development of a multi-faceted relationship with a view to elevate bilateral relations to the level of a long term and strategic partnership. The first-ever India-Malaysia CEOs Forum was jointly launched by both the PMs. PM Dr. Manmohan Singh delivered the ‘Khazanah Global Lecture 2010” at Putrajaya International Convention Centre on 27 October 2010. Both the PMs also inaugurated the ‘Little India’ project in Brickfields. Following six documents were signed during the visit: Agreement towards implementing Comprehensive Economic Cooperation Agreement (CECA) between India and Malaysia on 1 st July 2010; MoU on Cooperation in the field of Traditional Systems of Indian Medicine MoU on Cooperation in the field of Tourism MoU on Cooperation in the field of IT & Services Cultural Exchange Programme (CEP) and Agreement between CSIR of India and UNIK of Malaysia. Both countries also agreed to set up a Joint Working Group on Counter-Terrorism. Both governments are also establishing other enabling frameworks. A bilateral Extradition Treaty was signed in January 2010. The bilateral Treaty on Mutual Assistance in Criminal Matters has been finalized and is awaiting signature. A revised Double Taxation Avoidance Agreement and a MoU on Customs Cooperation have been finalized and are ready for signature. Defence Cooperation : India-Malaysia defence relations have steadily grown over the years. A MOU on Defence Cooperation was signed in 1993. The Malaysian Defence Minister had visited India in 2006 and Indian Defence Minister visited Malaysia in January 2008. Malaysia-India Defence Cooperation meetings at the level of Defence Secretary are held regularly; the eighth meeting of the MIDCOM was held in March 2010 and the 9 th meeting of the MIDCOM is being held on 16- 17 January 2012. Service Chiefs from both countries have regularly exchanged visits; in 2009 India’s Chief of Naval Staff visited Malaysia and the Chief of the Royal Malaysian Air Force visited India. The IAF Training Team deployed in Malaysia trained Malaysian pilots on the SU-30SKM aircraft for two-and-a-half years since February 2008. Indian naval ships regularly make port calls in Malaysia; in March and May 2011 the ICGS Sankalp and the INS Ranvijay visited Port Klang and Kota Kinabalu respectively, and in August the INS Airawat and the 1st Training Squadron of the Indian Navy (INS Tir , INS Krishna and ICGS Veera ) made port calls at Port Klang. India is also participating in the Cooperative Mechanism on the Straits of Malacca and Singapore (SOMS) and contributed to two of the six IMO Projects (Project 1 and Project 4) for enhancement of navigational safety and environmental protection in the Straits. Economic and Commercial Cooperation: Economic and commercial relations are emerging as the mainstay of the bilateral relationship. Malaysia is the third largest trading partner for India within ASEAN, and India is the largest trading partner for Malaysia from among the countries of the South, excluding China. With the coming-into-force of the India-Malaysia Comprehensive Economic Cooperation Agreement (CECA) from 1 July 2011, the bilateral economic engagement is expected to get a further fillip. The Comprehensive Economic Cooperation Agreement (CECA) is a single undertaking covering goods, services, investment and other areas of cooperation. It was formally signed on 18 February 2011 in Putrajaya during the visit of Commerce and Industry Minister. The first-ever India-Malaysia CEOs Forum, comprising 18 CEOs from both sides, was jointly launched on 27 October 2010 by Prime Ministers Dr. Manmohan Singh and Dato' Seri Mohd Najib to develop enhanced partnership and cooperation at the business level. The Forum held its second meeting in Mumbai on 20 May 2011. The third meeting was also held in Kuala Lumpur in November 2011. Bilateral trade increased by 17 times from US $ 0.6 billion in 1992 to US$ 10.5 billion in 2008, and has more than doubled from US$ 5 billion to US$ 10.3 billion between 2005 and 2008. According to Malaysian statistics, the two-way trade in 2009 declined to US $ 7.3 billion re-bounded to US$ 9 billion in 2010. In the first eleven months of 2011 (January – November), bilateral trade has shown robust growth to reach US$ 11 billion. Trade is significantly imbalanced in favour of Malaysia and Government of India has drawn the attention of the Malaysian Government on the importance of more balanced trade. Based on direct investments from Malaysia to India, it is the 24th largest investor in India with cumulative FDI inflows valued at US$ 2 billion from 1991 to 2010. In addition, about US$ 6 billion in Malaysian investments are believed to be invested in India through the Mauritius route. Notable among these are Maxis Communications in Aircel, Axiata in IDEA Cellular Ltd, Khazanah in IDFC, Apollo Hospitals, Yes Bank, etc. Malaysian construction companies’ largest presence outside Malaysia is in India. They have completed 52 construction projects worth US$ 2.34 billion in India, while 35 projects of similar value are under various stages of implementation. Under a partnership with Malaysian Airports, GMR completed airport in Hyderabad in 2008, and the second one in Delhi in July 2010. Indian companies have invested about US $ 2 billion, making it the 7th largest investor in Malaysia. Indian companies that made major acquisitions include Reliance Industries Limited, Ballarpur Industries Limited, Larsen & Toubro and WIPRO. Biocon India, Manipal University and Strides Arcolabs are amongst the companies who have announced fresh investments in Malaysia in the past six months. There are over 100 Indian companies including 60 Indian joint ventures operating in Malaysia. In addition, there are 60 Indian IT companies operating from Malaysia. IRCON International Ltd. has been actively engaged in the development of railways in Malaysia since 1988, and it is currently executing a double tracking project (Seremban – Gemas) worth over US $1billion. A MoU on Cooperation relating to the Provision of Technical Assistance Services on Highway Management and Development was signed in December 2010 during the visit of Shri Kamal Nath, Minister of Road Transport and Highways to Malaysia. A bilateral Steering Committee has been established to oversee the implementation of this MoU, which will enhance the participation of Malaysian infrastructure companies in the Indian economy. Tourism & Connectivity : Air links have improved significantly following a bilateral agreement in 2007 to progressively increase the seat capacity to six major destinations in India and a provision for multiple destinations and designating any number of airlines to operate on the India–Malaysia routes. At present, there are 114 flights between two countries, of which 93 are operated by airlines of Malaysia and 21 by airlines of India. Regular meetings of the Civil Aviation Ministries are held to liberalize the connectivity, and the last meeting was held in Mumbai in October 2011. India is the sixth largest source country for inbound tourism to Malaysia with about 700,000 Indian tourists visiting Malaysia in 2010 according to Malaysia Tourism statistics. Malaysia is the tenth largest source country for foreign tourists visiting India with 160,000 Malaysians visiting India in 2011. With the signing of the MoU for Cooperation in the Field of Tourism in 2010, there would be greater people-to-people contact and also greater flow of tourists from both the countries. Education & Cultural Cooperation : About 2000 Indian students are studying in Malaysia, while an estimated 5000 Malaysian students are studying in India.
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