Content

1. GLOBAL POWERS ...... 01-43

 USA ...... 1  A new European Union strategy for India ...... 11  Germany ...... 14  Japan ...... 17  Appendix: Asia-Africa Growth Corridor (AAGC) ...... 21  France ...... 23  Russia ...... 25  APPENDIX-I: Decline in Indo-Russia Relations ...... 28  Appendix-II: Why RIC is as important to India as JAI and BRICS?...... 29  UK ...... 32  Annexure: Extradition and the United Kingdom...... 34  Brazil ...... 36  Israel ...... 38  Appendix: India’s De-hyphenated Policy ...... 40

2. INTERNATIONAL ORGANIZATIONS & AGREEMENT ...... 44-84

 IMF ...... 44  World Bank ...... 46  WTO ...... 49  G-20 ...... 53  ASEAN ...... 54  BIMSTEC ...... 58  Indian Ocean region and world affairs ...... 61  BRICS ...... 62  Asian Infrastructure Investment Bank ...... 65  Trans Pacifi c Partnership (TPP) ...... 67  Regional Comprehensive Economic Partnership and India ...... 69  Multilateral Negotiations for a Nuclear Weapons Ban ...... 70  Wassenaar Arrangement and India ...... 72  India Admitted to Australia Group ...... 74  IAEA ...... 76  Nuclear Security Summit ...... 78  Non-Alignment Movement (NAM) ...... 80  UNSC Reform ...... 82

3. GLOBAL ISSUES ...... 85-107

 International Terrorism ...... 85  Migration Crisis in Europe ...... 86  Rising Protectionism and Currency Wars ...... 89  Greek Debt Crisis ...... 92  Iran Nuclear Deal ...... 94  Us Sanctions on Iran ...... 96  Global Initiative Launched to Fight Fake News ...... 98  What does US Recognition of Jerusalem Means? ...... 100  YEMEN WAR and Implications ...... 102  Why Saudi Arabia is Moving Towards Reforms? ...... 104  Rohingya Repatriation Deal Signed ...... 105 QUALITY IMPROVEMENT PROGRAMME

1. GLOBAL POWERS

USA

 PIVOT TO ASIA  Over the last two decades, Washington has remained stuck in Afghanistan and Iraq, thus paving way for China to advance its political infl uence within the Asia-Pacifi c. “Pivot to Asia”, or more specifi cally “US rebalancing”, demonstrates the realization of American strategic thinking towards the threat which Beijing poses to Washington not only diplomatically but also economically.

Objectives:  To Counter China: The central intention is balancing and countering China’s rise in the Asia-pacifi c region while the other objectives revolve around it.  Asian century: The signifi cance of Asia Pacifi c lies in the geopolitical interests of the key powers of the global politics. The years following the fi nancial predicament of 2009 have witnessed some crucial political and strategic changes since the region has become the centre of attraction driving the global politics.  Constructing a Sense of Justifi cation: Since Washington is currently preoccupied in War-on-Terror, it requires a good reason to pull out its resources from the other regions to Asia-Pacifi c. The recent phenomenal boom of China has provided US that justifi cation where it feels itself bound to balance and to defend the land from any aggression.  Strengthening Alliances: Another objective places the strengthening and reinforcing the strategic alliances as the foremost goal of the US. The idea is to reassure the Asian partners its presence whenever they feel threatened especially by China.  Peaceful Resolution of Regional Disputes: The non-violent resolution of Asian disputes is in the American core interests. The US is very much concerned regarding the solution of China-Taiwan tension and Korean Peninsula. It is keen to imply diplomatic efforts to ensure regional security. Another objective involves the denuclearization and non-proliferation of North-Korea in-order to guarantee peace and protection.  Incorporating Rising Powers: Another objective involves the integration of emerging China into contemporary global order. Keeping into consideration China’s economic and military boost, it is vital for the US to make Beijing act as a mature and responsible regional stakeholder.  Multilateral Commitment and Tackling Non-Traditional Dangers: The strategic alliances are the building-blocks for collaboration against security threats faced by the region whether it be extremism, dangers from climate change, infectious diseases, nuclear proliferation or natural calamities (Sutter & Others 2013, 3). Such an alliance provides a basis for trust-building and cooperation to tackle Chinese rise.  Steps under it: Politically speaking, three elements of US rebalancing strategy have been fi gured out that includes defence, fi nancial and diplomatic aspects

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 Security Aspect: The recent adjustments in the US defensive posture reveal the importance of the element of security for the only global hegemon. Washington is aggressively shifting its extensive military potentials from other targets to one platform that encompasses the entire Asia-Pacifi c region thus, reshuffl ing its defensive arrangements to ensure a much broader presence of the US armed forces to counter any possible belligerence. This incorporates the highly sophisticated military dispersion in Philippines and Australia and also to other regional allies, thereby guaranteeing an enhanced coercive amalgamation within the region.  Financial Aspect: The rebalancing strategy also involves an intention to enhance trade and economic schemes amongst the US and its partners in-order to foster a trustworthy environment.  Diplomatic Aspect: The pivot has witnessed heightened diplomatic and military engagement of US high-profi le offi cials in Asia-Pacifi c. The agenda involves reinforcing the strategic partnerships, engaging multilateral organizations, controlling US-China hostility and promoting trust-building cooperation amongst the two global giants.

China’s reaction to it:  Russia and China have become closer; Russia in August 2015 released a new naval doctrine that singles out China as its core partner in the Pacifi c  China has launched various projects like One Belt One Road Initiative; AIIB

India:  Has been a tough balancing game for India,  On one hand, it is becoming a part of Asia pivot (2 visits in 2 years, increasing defence relations and recent conclusion of Malabar exercise); ! China’s increasing presence in Indian Ocean and thus we need US ! Complimentarily exists between US Asia’s pivot and India’s act east policy  But to counter the tilt, India has also sought membership of SCO.  CONCLUSION  Keeping in consideration the current political scenario within Asia-Pacifi c, it is high time to resolve the tensions in South China Sea (SCS) region since the focus of the core powers remains in the very region and even a small skirmish could usher the world towards a global war.  The peaceful future of China and America lies in the clarifi cation of mutual misunderstandings, however, the analysts have observed their future relationship in two entirely different perspectives.  One is extremely pessimistic, focusing on realism where there would be a serious power struggle and a zero-sum battle amongst China and US.  The second view incorporates optimism, focusing on Liberal stance where its advocates believe that cooperation amongst the two giants would ultimately become inevitable.  Since the two would, diplomatically and economically, rely on each other, therefore, confl icts would be de-escalated and wars could be eschewed. Hence, only time will tell what lies ahead but one thing remains evident that Asia-Pacifi c would decide the fate of the world.  DEFENCE COOPERATION BETWEEN INDIA AND USA  Defence relationship has emerged as a major pillar of India-U.S. strategic partnership with the signing of ‘New Framework for India-U.S. Defence Relations’ in 2005 which has been renewed recently.

Ways of cooperation:  Defence trade – as of December 2014, Aggregate worth of defence acquisition from U.S. Defence has crossed over US$ 10 billion.

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 Co-production ! Defence Trade and Technology Initiative (DTTI) has been established to simplify technology transfer policies and exploring possibilities of co-production to implement make in India. ! In sept 2015 pentagon established India Rapid Reaction Cell (IRRC) to pursue all aspects of the India-U.S. Defence Trade and Technology Initiative (DTTI). It’s a fi rst country-specifi c cell. ! During the visit of defence secretary in June 2015, Both India and the United States have fi nalized two project agreements for joint development of Mobile Electric Hybrid Power Sources and the Next Generation Protective Ensembles. ! It was also decided to expedite discussions to take forward cooperation on jet engines, aircraft carrier design and construction, and other areas under ‘Make in India’.  Joint exercises – Indian navy ship participated in Rim of the Pacifi c (RIMPAC) exercise in 2014; Malabar in 2015  Personnel exchanges,  Collaboration and cooperation in maritime security and counter-piracy, and  In June 2015 the 2015 Framework for the US-India defence relationship was signed. It reviews the 2005 agreement and will guide the bilateral defence and strategic partnership for the next ten years. The new Framework agreement provides avenues for high level strategic discussions, continued exchanges between armed forces of both countries, and strengthening of defence capabilities. The Framework also recognizes the transformative nature of the Defence Technology and Trade Initiative (DTTI).  Institutional mechanisms for dialogue like Defence Policy Group (DPG), Defence Joint Working Group (DJWG), etc. Reasons:  India’s need for upgraded defence equipments due to threat of 2 front-war and US need of market.  Due to our common interests like stability, counter-terrorism and ensuring free fl ow of commerce and resources through the vital sea lanes of Indian Ocean.  Probably US desire to counter China via India, for that India has to be strengthened; a part of pivot to Asia. Recent Deal  In early April 2016, U.S. Defence Secretary Ashton Carter visited India.  During the three day visit talks were initiated on Logistics Exchange Memorandum of Agreement (LEMOA).  During the visit, the mutual proximity of the two countries’ militaries appeared greater than ever, and a clear signal of both sides’ cooperative intent came in the form of an announcement that the Logistics Exchange Memorandum of Agreement (LEMOA) would be signed in the forthcoming weeks or months.  Mr. Carter spoke of his desire to advance consultations on cooperation over the joint development of aircraft carriers and jet fi ghter technology. In addition to LEMOA, two “pathfi nder projects” were announced, to co-develop a Digital Helmet Mounted Display; and so was a Joint Biological Tactical Detection System.  Meanwhile, Mr. Parrikar and Mr. Carter have agreed to expand collaboration under the Defence Technology and Trade Initiative, infuse greater complexity in their military engagements and maritime exercises, commence discussions on submarine safety and anti-submarine warfare, and initiate a bilateral maritime security dialogue that would include diplomats and the defence establishments.  How strong are defence relations between the 2 sides?

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! India-U.S. defence cooperation has witnessed an unprecedented boom for well over a decade now, rising from being “as fl at as a chapati” in 2002, in the words of former U.S. Ambassador to India Robert Blackwill, to the present day, with the aggregate worth of defence acquisitions from Washington exceeding $10 billion.

What are the challenges ahead?  The relationship should be seen exclusive of India’s outreach to other countries  Yet if burgeoning trade volumes have historically represented the upside to growing convergence within bilateral defence ties, then the paucity of actual, production-line-based collaborative initiatives under the Defence Technology and Trade Initiative (DTTI) - which in a hypothetical world would tie in neatly with Prime Minister Narendra Modi’s ‘Make in India’ initiative - is a testament to the need for more trust and willingness to be accommodative towards a partner.  However, going by the plodding pace of four other such “pathfi nder projects” outlined during U.S. President Barack Obama’s visit to India in January 2015, it may be unwise to expect the two announced during Mr. Carter’s visit to result in actual production kicking off any time in the near future. Of the initial four pathfi nder projects agreements, only two were signed in August 2015, the two appear to have fallen off the table or at least placed on the shelf for the moment.  While some discussions under DTTI have slowed or stalled owing to Washington’s inability, for a variety of reasons, to meet India’s hopes and expectations for sharing sensitive technologies and others have paused to come to grips with India’s offset rules under the latest Defence Procurement Procedure, there appears to be rising frustration all round at the crawling pace of progress.  NEW PHARMA RULE OF US AND ITS IMPACT ON INDIAN PHARMACEUTICALS  United States government reportedly made it mandatory for Active Pharmaceutical Ingredients (APIs) to be manufactured locally. It is mandatory for APIs to be manufactured locally for governmental supplies of drugs but not for retail marketing.  The decision of Local manufacture of ingredients made mandatory has sent to Indian pharmaceutical exporters and it will signifi cantly impact Indian drug exports.  At present, nearly 80% of drug raw material requirement is met by India or China.

Why US bring this new rule?  The changes in the norms have been made under the Drug Master Files (DMF) - a submission to the USFDA.  To provide and get confi dential information about facilities, processes, or articles used in the manufacturing, processing, packaging, and storing of one or more human drugs.

What was the old policy?  Before the new norms came into effect, ! U.S.-based companies were allowed to procure for Active Pharmaceutical Ingredients (APIs) from countries like India and China. ! They can make the fi xed formulations (fi nal product) in the U.S. ! They can sell the drugs to the U.S. government.  India’s supply to the US market increased at an average annual rate of 44% from 2008 to 2012 (from $255 million in 2008 to $1.12 billion in 2012).  India was the second largest supplier of generic APIs to the US market with a 24.4% share in 2014, according to the CPA report.

How it will impact India?  Indian companies are not allowed to quote for government contracts in the U.S. since India is not a signatory to the WTO’s government procurement agreement.

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 But this change will affect companies which have subsidiaries in the U.S. that procure APIs from their Indian counterparts and make the fi nished product in the U.S.  It will also be a setback for Indian companies that have subsidiaries or holdings in the U.S.  At present, nearly 80% of drug raw material requirement is met by India or China

Impact on U.S.A  It will seriously impact availability and prices of medicines in the United States. The U.S. government procurement prices will go up signifi cantly.  Cost of generics for the US will go up.  Infl ation in drug prices is a major setback to this rule.

Way Ahead  Sources say that the government would initially endeavor to determine this issue bilaterally involving both the parties  If this fails then the next step considered would be to approach the World Trade Organization’s dispute settlement panel.  Pharmexcil - India’s pharmaceutical Export Promotion Council - has approached the Commerce Ministry, requesting authorities to intervene and resolve the issue.  WTO RULE IN FAVOUR OF USA IN SOLAR POWER CASE  Recently WTO released its ruling against India’s National Solar Mission, deciding that India’s efforts to boost local production of solar cells violated WTO rules.

What is the issue all about?  India in 2010 launched its National solar programme the program aimed at reducing the cost of solar energy and achieve 100000 MW of solar power capacity by 2022. . This solar programme was launched because coal was unable to meet India’s power sector demands and also focusing on solar power would meet India’s commitment towards climate change.  To incentivize the production of solar energy within the country, the government under the programme agrees to enter into long-term power purchase agreements with solar power producers, effectively “guaranteeing” the sale of the energy produced and the price that such a solar power producer could obtain.  Thereafter, it would sell such energy through distribution utilities to the ultimate consumer. However, a solar power producer, to be eligible to participate under the programme, is required compulsorily to use certain domestically sourced inputs, namely solar cells and modules for certain types of solar projects. In other words, unless a solar power producer satisfi es this domestic content requirement, the government will not ‘guarantee’ the purchase of the energy produced.

US stand in this case?  In 2013, the U.S. brought a complaint before the WTO arguing that, the domestic content requirement imposed under India’s national solar programme is in violation of the global trading rules specifi cally, it said, India has violated its national treatment obligation by unfavorably discriminating against imported solar cells and modules. In other words, India was discriminating between solar cells and modules which were otherwise identical on the basis of the national ‘origin’ of the cells and modules, a clear violation of its trade commitment.

What is India’s stand in this case?  India argued that the program helps the country to meet its climate commitments under the United Nations Framework Convention on Climate Change (UNFCCC), the WTO rejected that argument.

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 India principally relied on the ‘government procurement’ justifi cation, which permits countries to deviate from their national treatment obligation provided that the measure was related to “the procurement by governmental agencies of products purchased for governmental purposes and not with a view to commercial resale or use in production of goods for commercial sale”.  India also argued that nearly half of US States have renewable energy programs that, like India’s solar program, include “buy-local” rules that create local, green jobs and bring new solar entrepreneurs to the economy. WTO panel stands in this case  WTO panel decided that India has violated In its ruling, the WTO agreed that India’s buy-local rules “accord less favorable treatment” to imported solar components, even while acknowledging that imported cells and modules currently have a dominant share of the market for solar cells and modules in India.  In so far as the government procurement derogation was concerned, the panel found that the product being subject to the domestic content requirement was solar cells and modules, but the product that was ultimately procured or purchased by the government was electricity. The domestic content requirement was therefore not an instance of government procurement  Besides, the panel also found that since India failed to point out any specifi c obligation having direct effect in India or forming part of its domestic legal system, which obligated India to impose the particular domestic content requirement, the general exception was not available to the Indian government in the instant case. Is there basis for domestic content requirement?  There appears to be no rational basis for how mandatory local content requirements contribute towards promoting the use of clean energy. If the objective is to produce more clean energy, then solar power producers should be free to choose energy-generation equipment on the basis of price and quality, irrespective of whether they are manufactured locally or not.  In fact, by mandatorily requiring solar power producers to buy locally, the government is imposing an additional cost, usually passed on to the ultimate consumer, for the production of clean energy. Impact of this decision  Solar power producers in India would get freedom to choose energy-generation equipment on the basis price and quality, irrespective of whether they are manufactured locally or not, Since most of the producers in USA and China produce these equipments cheaply it would reduce the price of solar electricity in India which benefi t the consumers of solar power in India.  However, this may affect the profi tability and future of nascent solar equipment making industry in India since power producers in India would hardly buy from them after this decision as there equipments are of inferior quality and also they are costly.  It would also give a boost to investment in solar power industry as with reduction in cost the profi tability of solar power producers would increase. Options for India  India has an option to appeal to the appellate body. Simultaneously, India may be exploring the option of fi ling a counter complaint against the U.S., with several states in the U.S. such as Michigan, Texas and California having also reportedly been accused of employing mandatory local content requirements in the renewable energies sector. Way foreword  India must resist the temptation of adopting protectionist measures such as domestic content requirements which are inconsistent with its international obligations. Domestic content measures, despite their immediate political gains, have a tendency to skew competition. Manufacturers must remain free to select inputs based solely on quality and price, irrespective of the origin.

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 It is entirely possible to give preferential treatment to clean energies (in the form of tax rebates for solar power producers and so on) without requiring mandatory local content.  INDIA, U.S.A MARITIME SECURITY DIALOGUE  India and the US have recently held their fi rst Maritime Security Dialogue which focused on boosting cooperation in the challenging sector with Washington rebalancing its military assets to Asia Pacifi c. Key points of the dialogue  The dialogue covered issues of mutual interest, including exchange of perspectives on maritime security development in the Asia-Pacifi c and Indian Ocean Region as well as prospects for further strengthening cooperation between India and the United States in this regard. It focused on strategic maritime security issues like:  Asia-Pacifi c maritime challenges,  Naval cooperation,  Multilateral engagement. ! They also agreed to launch a bilateral Maritime Security Dialogue. ! The other initiatives agreed include the conclusion of a “white shipping” technical arrangement to improve data sharing on commercial shipping traffi c and Navy-to-Navy discussions on submarine safety and Anti-submarine warfare. ! They have also put out a joint strategic vision for the Asia-Pacifi c and Indian Ocean regions, calling for the freedom of navigation and unimpeded movement of ships through the global commons or high seas, in an oblique reference to China putting embargos on the movement of ships and airplanes through the disputed waters of the South China Sea. Why India must guard its maritime boundary?  The primary maritime security challenges in the South and South-West Indian Ocean (SSWIO) include piracy at sea, narcotics and small arms/light weapons traffi cking and people traffi cking. Increasingly, maritime terrorism is a distinct threat.  It is important to focus on maritime security to ensure that the Sea Lines of Communications (SLOCs) are kept free for navigation by ships and naval vessels.  For deepening the evolving partnership in the maritime domain,  For India to retain its dominant position in the Indian Ocean region and safeguard its commercial and strategic interests, it is time that India should turn its strategic vision towards the maritime region. India-US recent developments in securing defence ties  U.S.-India Defence Technology and Partnership Act in US Congress which would institutionalize Defence Technology and Trade Initiative (DTTI) framework between India and US.  Signing of agreements like Logistics Support Agreement (LSA) which will allow use of Indian bases for logistic purposes and vice versa, and likewise Basic Exchange and Cooperation Agreement (BECA).  Emergence of US as the largest arms supplier to India India’s engagement with multiple partners can be discussed as:  Defense Technology and Trade Initiative (DTTI) between US and India  Malabar exercise and plans to buy US-2 amphibian aircrafts from Japan  Collaboration with Australia through Indian Ocean Rim Association for Regional Co-operation (IOR- ARC) and Indian Ocean Naval Symposium (IONS) to establish Indian Ocean as Zone of Peace

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Why is India engaging in multiple agreements?  Now, India is focusing on multiple partners instead of relying on a single ally due to the fact that it wants to diversify the nations it shares contacts with for its defence and security.  India hedges by deepening relations with the US and status quo middle powers such as Australia  The strategic dimensions of the bilateral defence relationship have now moved from its politico- strategic attributes to taking on economic-strategic ramifi cations. So, India has shifted its focus from depending on a single country.  To ensure security of the Indian Ocean region, India needs to have good terms with all stakeholders in the region. So, India is working with the states in the Indian Ocean region and others to strengthen security and economic cooperation.  The new focus on the Asia-Pacifi c highlights the security and economic dimensions. The US rebalancing of forces and counter-measures by China have created a new cold war. New partnerships are in the making in the Asia-Pacifi c; this has shifted the focus to need for multilateral partners.  India is no longer hesitant about taking a larger responsibility for securing the Indian Ocean, promoting regional mechanisms and working with great powers like the United States and France with which India shares many interests. So, India has initiated a new process of multilateralism. Implications  The US’s rebalancing towards Asia, would mean assigning higher priority and political, economic and security resources to the Asia-Pacifi c region because of its dynamism and the increased assertiveness of a rising China.  It would enable India to enhance its defence capabilities and take proactive steps to build and install marine infrastructure, provide patrol ships, contribute to capacity building and assist in patrolling to protect the South and South-West Indian Ocean (SSWIO) region against traditional and non-traditional maritime threats.  The collaboration with different countries is likely to have additional benefi ts as well in addition to the defence security.  Closer relationship with Australia, Japan and America is not only necessary for Defense purpose, but it can also help ensure continuous energy supply for India,  It will help India overcome New Challenges in the Indian Ocean such as China’s presence in the Indian Ocean (IO), building military naval bases, China increasing cooperation with strategically important Sri Lanka (SL), Maldives, Pakistan and China -US rivalry for dominance by not depending on a particular country. Additional measures India can take to address the maritime challenges  Build its Naval strength, rapidly modernize its navy, develop civilian maritime infrastructure and island territories. Undertake maritime operations across littoral states to expand capacity.  Deepen bilateral, trilateral and multilateral military security cooperation with countries in the Indian Ocean.  Strengthen Naval cooperation with maritime neighbors like Sri Lanka, Maldives. Increase naval assistance and develop stronger relations with other island countries like Seychelles and Mauritius.  Expand its Multilateralism through forums like Indian Ocean (IO) Rim Association and Indian Ocean (IO) Naval Symposium.  INDIA-USA TIES: LEMOA  Recently the defence partnership between US and India took a new shape. With the high level delegation meetings in August, decade long talks were concluded on Logistics Exchange Memorandum of Agreement (LEMOA).

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 LEMOA was a long-anticipated bilateral deal on military logistics exchange, which was fi rst mooted in the early 2000s. After 12 years of back and forth, India and the US have agreed on a logistics exchange memorandum of understanding (LEMOA). This is a watered down version of the standard logistics cooperation agreement that the US military has with dozens of countries. Key features of LEMOA agreement are:  LEMOA formalises an ad-hoc arrangement already in practice and furthers India-US military-to- military cooperation. The agreement provides access to each other’s military facilities for fuelling and logistic support on a reimbursable basis.  The core of both agreements is a regularization of the ability of naval ships and aircraft of both countries to dock in each other’s bases for taking on supplies like fuel. Indian and US naval ships and aircraft have often used each other’s naval and air bases before. Base usage and taking on supplies will now be much easier for naval ships and aircraft under both fl ags.  These activities are limited to joint military exercises, training, port calls and humanitarian missions and other military activities that both sides mutually agree to undertake.  It does not give the US automatic access to Indian military bases or to logistical support, but simply smoothen existing practices.  The advantage over the current situation is precisely following: Though the US does currently use Indian military bases and logistics during joint military exercises — this is managed on a case-by- case basis, which is simply more cumbersome. LEMOA does not necessarily give anything that the US does not already get, but it makes the process more regularised.  LEMOA helps grease the wheels on the bureaucracy underlying defence collaboration, including reimbursements for military logistics sharing. Signifi cance of LEMOA  India will be the main benefi ciary. While Indian naval ships and aircraft increasingly venture further away from their home, India has no bases and in some cases not even agreements with foreign governments along the Atlantic and Pacifi c. The US navy and air force, on the other hand, has a global network which is now accessible to Indian ships and aircrafts.  US warships and aircraft now have additional sites to use in India, but they already have many bases around the region at their disposal.  Indian arrangements with the US for such access open up new options in beefi ng up India’s logistics capacity for missions in the Indian Ocean.  In one of the more concrete benefi ts, LEMOA strengthens India’s outreach to areas that were not typically within its reach. With one aircraft carrier in operations, India’s capacity to undertake far sea operations has been fairly limited. Signing LEMOA opens up opportunities such as gaining access to US military bases in Djibouti and Diego Garcia. Criticism  Critics in India have claimed that LEMOA draws India into a nascent alliance with the US. But this is not true as buying diesel and food supply is hardly the stuff of strategic alignment. Also, agreement does not create any obligations on either Party to carry out any joint activity.  There is a criticism that this agreement would allow US troops to be based on Indian soil which is not true. It does not provide for the establishment of any bases or basing arrangements.  Another view is that India has been so sensitive about what amounts to the military equivalent of buying groceries on credit, which looks absurd when the US is emerging as India’s number one source of high end arms, its key overseas source for counter-terrorism intelligence and its most common military exercise partner.  Another misperception about the LEMOA has been that signing it will make India a party to America’s confl icts and policies, especially in West Asia and East Asia. But this is not true either, even most countries formally allied with the US have not been dragged into these wars, let alone those simply signing the LEMOA.

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A New European Union Strategy For India

 CONTEXT:  European Union has released its strategy document on India after 14 years.  The 2004 EU-India declaration on building bilateral strategic partnership, which current strategy document replaces, did not have much of a success in reconfi guring the relationship as was expected.  ABOUT:

Strategy Document:  The new strategy underscores a transformative shift in Brussels vis-à-vis India and lays out a road map for strengthening the EU-India partnership.  Key focus areas includes:  Consideration of broader Strategic Partnership Agreement: The EU-India relations are currently governed by the 1994 EU-India Cooperation Agreement. To be able to match the ambitions set out in this Joint Communication and tackle the global challenges of today, the EU and India should consider the negotiation of a broader Strategic Partnership Agreement.  Upgrade the yearly dialogue between the High Representative / Vice President of the EU and the Indian Minister for External Affairs to a regular Strategic Dialogue.  Intensify dialogue on Afghanistan and Central Asia in the appropriate settings.  Join forces on post-confl ict institution building and reconciliation processes in third countries.  Strengthen technical cooperation with India on fi ghting terrorism and countering radicalisation and violent extremism and countering terrorist fi nancing.  Exchange expertise on cyber security and hybrid threats.  Conclude working arrangements to foster cooperation between Europol and Indian law enforcement institutions.  Identify common actions with India both at policy and operational levels to enhance maritime security. Work with India and other key regional players such as South Africa to help build the capacity of maritime nations in the Indian Ocean and East Africa.  BACKGROUND:  In 1962, India was the 1st developing country to establish diplomatic relations with European community.  The EU-India Enhanced Partnership Agreement in 1996 appreciated India’s economic successes after the liberalization.  EU-India Cooperation Agreement 1994 provides the legal framework for their relations.  India and the EU have been strategic partners since 2004.  The 14th annual summit between India and European Union was held in October, 2017. Areas of Cooperation:  Natural Partners: There is a new push in Brussels to emerge as a geopolitical actor of some signifi cance and India is a natural partner in many respects based on principles of democracy, human rights, tolerance and internal diversity.  Economic cooperation: EU is India’s largest trading partner, accounting for 13.2% of India’s overall trade. Further the trade in services has almost tripled in last decade. The EU is also the largest destination for Indian exports. ! Major EU exports to India include engineering goods, gems and jewellery and chemical and allied products.

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! The primary EU imports include textiles and clothing, chemical and allied products and engineering goods.  Key source of investment and technologies: The EU is the second largest investor in India.  International scenario of protectionism and authoritarianism: ! They share common responsibilities to secure peace and stability because of the current uncertainties in the global arena. The EU and India are very stable and predictable partners. ! There is widespread disappointment with the trajectory of China’s evolution and the Trump administration’s disdain for its Western allies is highly disruptive.  Cooperation on multilateral forum: The EU and India have similar views on multilateralism, underlining their full support for the United Nations and other multilateral forums, and EU is in favour of making UNSC more effi cient and effective.  Counter Terrorism issues and Global Counter Terrorism Forum: During India-EU annual counter terrorism and political dialogue, both countries are working on establishing direct links between Europol and Indian agencies.  International Solar Alliance: The EU plans to join International Solar Alliance (ISA) by the year end. The EU has already fi nanced the ISA secretariat as well as other programs. EU has invited India to escort World Food Programme vessels to transport food to Somalia.  International Law: Both EU and India are strong promoters of the respect for international law, in particular UN Convention on Laws of the Sea (UNCLOS).  Close coordination on regional issues: India coordinated closely with EU during the crisis in Maldives, while the two sides have intensifi ed discussions on Sri Lanka, Bangladesh and Nepal.  People-to-People Contacts: The India-EU Forum has emerged as an important Track II forum for discussion between policy analysts on both sides. It is led by the European Union Institute for Security Studies and the Indian Council of World Affairs and includes participation from academics and think-tanks.  ICT Cooperation: ! The EU and India aim to link the ‘Digital Single Market’ with the ‘Digital India.’ ! A new “Start-up Europe India Network” initiative was launched in 2016. ! Further, an EU-India Cyber Security Dialogue has been set up that focuses on exchange of best practice on addressing cybercrime and strengthening cyber security and resilience.  City to City Cooperation: There is city-to-city cooperation between European and Indian cities such as Mumbai, Pune and Chandigarh in a fi rst phase and twelve more cities involved in the current phase. Now it is being formalized in an India-EU Partnership for Smart and Sustainable urbanization, which will support the Indian ‘Smart cities’ and ‘AMRUT’ initiatives. Areas of confl ict:  Issues in Broad-based Trade and Investment Agreement (BTIA): India EU relations have been defi ned by the collective failure to complete a free trade agreement. EU’s issues with India  EU demands elimination of India’s duties on goods such as automobiles and wants tax reduction in wines, spirits and dairy products. These are the areas that will affect Indian farmers and competitiveness of their product.  It seeking a strong intellectual property regime.  EU is keen on fi nalization of an India-EU Bilateral Investment Treaty (BIT) before the re-launch of the FTA talks while India wants to make ‘investment protection’ a part of the negotiations on the proposed comprehensive FTA.  India’s model BIT and its Investor-State Dispute Settlement Mechanism: It has become a contentious issue as it allows companies to seek international arbitration only when all domestic options have been exhausted.

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EU released its strategy on India after 14 years.

This road map replaces 2004 EU-India Declaration on building bilateral strategic partnership.

its security policy Need for EU to work closely with India EU-India clean energy engagement in the region and climate partnership Strategic Climate will contribute to India can be an Partnership Change reducing global important partner in Good Economic resource pressure and implementing Sense GHG emissions

the EU’s strategy There has been In all probability , India will Will become global on connecting balanced trade become the most populous growth engine , Europe and Asia between India and EU country in near future , and is supporting job ( worth Euro 115 already the fastest growing large creation and billion in 2017 alone) economy investment objectives

promoting rules based global working for security and stability order and trading system in overlapping neighbourhoods Enganging on Improving sustainable Promoting effective Reinforcing cooperation coordination in connectivity both multilateralism on foreign policy UN, WTO and G20 at strategic and operation levels How to strengthen the political partnership ? Military Promoting gender relations via equality, women’s Building on Common Developing security and personal empowerment and Values and Objectives defence cooperation exchanges human rights and trainings

Coordination on humanitarian Aiming Fighting terrorism Exchanging expertise on and disaster relief operations SDG goals and radicalisation maritime and cyber security

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India’s Issues with EU  India is looking for data secure nation status to be granted by the EU. The country is among the nations not considered data secure by the EU. It will have a bearing on Indian IT companies wanting market access.  Non-tariff barriers such as sanitary and phytosanitary measures, and technical barriers to trade are also a major concern. The EU has been imposing stringent labeling requirements and trademark norms, which have dented India’s exports.  Trade in services: India demands strong binding promises by the EU on liberalising trade in service particularly Mode-4 services.  Two-way trade between India and the EU dipped to 88.4 billion in 2015−16 from 88.4 billion in 2015−16 from 98.5 billion in the previous fi scal. Other areas of confl ict:  Indian government fi nds diffi cult to understand the bureaucratic structure of Brussels (EU) to navigate and in the process the EU was ignored as a collective.  Individual nations of the EU started becoming more pragmatic in their engagement with India, but Brussels continued to be big-brotherly in its attitude on political issues and ignorant of the geostrategic imperatives of Indian foreign and security policies.  The result is a limited partnership which largely remained confi ned to economics and trade.  Even as the EU emerged as India’s largest trading partner and biggest foreign investor, the relationship remained devoid of any strategic content.  China–EU relations: Despite the two not having any ideological affi nity, the EU-China relations carried greater traction. Way forward:  In the past EU-India relations have been blocked by specifi c bilateral issues like the FTA or the Italian Marines issue, but foreign policy and security issues played an important role in the 14th annual Summit, with far-reaching statements on naval exercises, space cooperation etc which two years ago would have seemed impossible.  The new India strategy document unveiled by the EU comes at an appropriate time when both have to seriously recalibrate their partnership. India needs resources and expertise from the EU for its various priority areas, such as cybersecurity, urbanisation, environmental regeneration, and skill development.

Germany

 INTRODUCTION  India and Germany have been strategic partners since 2000. But at the core of the relationship is a strong economic partnership. Many of the things that make up Modi’s vision of India — Skill development, Digital India, Make in India and giving an impetuous to small and medium-sized business — encompass what Germany can provide. In fact India’s needs and Germany’s expertise are a perfect fi t. So India hopes to further strengthen and expand this relationship.  Germany is India’s largest trading partner within the EU. It is also one of the leading foreign direct investors in the country, with as many as 1,600 German companies operating in India. Six hundred joint ventures are already in place.  Recently, Indian PM Modi visited Germany and during the visit Terrorism was the big part of conversation between two nations as terror strikes have become a global phenomena. The latest attack in Manchester is just one of the many deadly strikes across Europe. The Prime Minister discussed about the terror emanating from Pakistan as well as his take on what is happening in

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Afghanistan. Both leaders exchanged views on how best the international community can work together against this common issue. Why strong India-Germany bilateral ties are important for our country?  As the two countries discuss various issues, it is worth looking at how India’s bilateral ties with Germany — India’s largest trading partner within the European Union — have evolved over the years.  Historically: As far as the history of India-Germany ties are concerned, India was one of the fi rst countries to diplomatically acknowledge and accept the Federal Republic of Germany after the Second World War in 1945. It was in 1951 that the two countries decided to establish an economic relationship.  Economic Relations: ! A strong economic partnership with Germany means that the country can provide for many schemes and programmes devised by Modi like Digital India, Make in India and Skill India. ! The German embassy in Berlin had launched the Make in India Mittelstand (MIIM) Programme in September 2015 to facilitate the German Mittelstand (SMEs) to do business in India. ! Currently, 73 German Mittelstand (SMEs) companies are being facilitated through MIIM Programme for their market entry and investment in India. Out of these, 46 companies have progressed well in India investment plan. ! Germany is currently also one of the leading foreign direct investors in India, with around 1,800 German companies operating in India. As per data with Department of Industrial Policy and Promotion, Germany is the seventh biggest FDI source for India. ! From April 2000 to March 2017, various German companies have invested about $9.7 billion in India, which is about 3 percent of total FDI fl ows the country has witnessed. Indian corporate entities have also invested over $7 billion in Germany. ! 600 joint ventures are also in place.  Exports: Textiles, metal and metal products, electro-technology, leather and leather goods, food and beverages, machinery, pharmaceuticals, auto components, chemicals, gems and jewellery, and rubber products are the main exports to Germany.  Imports: The key items imported from there are machinery, electro-technology, metal and metal products, chemicals, auto components, measurement and control equipment, plastics, medical technology, pharmaceuticals, paper and printing materials.  Strategic Partners: India and Germany have been strategic partners since 2000. The website of the Indian Embassy in Berlin explains that the Intergovernmental Consultations (IGCs) between India and Germany is meant for a review of cooperation and provides a platform for fresh ideas. India is one of the few countries with whom Germany has such a dialogue mechanism.  The third IGC before the current one was held in New Delhi on 5 October, 2015. German Chancellor Angela Merkel has also visited India in 2007, 2011 and again in 2015 for the third IGC. On the other hand, Modi visited Germany in April 2015 whereas External Affairs Minister Sushma Swaraj visited Germany in August 2015.  UN Security Council: India and Germany also cooperate closely on the issue of the expansion of the United Nations Security Council (UNSC) within the framework of G-4 with Japan and Brazil. Both countries seek to become permanent members of the UNSC.  Defence Cooperation: The India-Germany Defence Cooperation Agreement, established in 2006, provides a framework for defence cooperation. The High Defence Committee meetings at the Defence Secretary level take place annually and atlernately in New Delhi and Berlin.  Science and Technology: Moreover, there are currently over 150 joint science and technology research projects and 70 direct partnerships between universities of both countries.  Geopolitics: In the context of China’s One Belt One Road initiative, Modi and Merkel are converging on working together in Africa, focusing on renewable energy, connectivity, vocational training, and have called on businesses to collaborate on promoting trade and development.

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 Climate change is an important focus area. India has made it clear that it is committed to the Paris Agreement. The two countries remain committed to work with Afghanistan to tackle terrorism, thus containing Pakistan. Current Challenges  Over the last six years, the total trade between the two nations has been on a decline. From a high $23.5 billion in 2011-12, the total trade has come down to $18.73 billion in 2016-17. India has a trade defi cit with Germany. As trade is on a decline, the defi cit too has declined from $7.6 billion to $4.2 billion over the last six years.  The strategic partnership between India and Germany is also limited because Germany does not have a lot of geopolitical infl uence in South Asian affairs.  During the current visit, India stressed on the need for counter-terrorism efforts in Europe as the terrorism is the “gravest challenge facing humanity”.  Free Trade Agreement: With fears of countries leaving the EU after Britain now having receded, a free trade agreement with Europe will be now being looked at with fresh enthusiasm. So far, 16 rounds of negotiations have been completed and both India and the EU are keen to get this agreement signed and sealed. No dates are yet on the horizon as yet, because the EU must now go through the arduous process of untangling Britain from the bloc. It will take more time to materialize. What are the outcomes of the recent visit?  India and Germany discussed on a host of key issues like trade, skill development and climate change  MOUs: The two sides also signed 12 MOUs/agreements in fi elds like ! Cyber policy, ! Development initiatives, ! Sustainable urban development, ! Continued development of cluster managers and skill development, ! Digitalisation, ! Railway security, and ! Promoting Vocational training.  Intergovernmental Consultations: The two sides also issued a joint statement after Modi and Merkel held the fourth India-Germany Intergovernmental Consultations (IGC).  The two leaders underlined their common concern about the threat and global reach of terrorism and extremism while condemning terrorist violence in all its forms and manifestations.  Both the nations agreed on the need to take strong measures against all those who encourage, support and fi nance terrorism, provide sanctuary and safe havens that sustain and support terrorist groups and organisations.  India and Germany pledged to “chart out a future roadmap of cooperation with focus on trade and investment, security and counter-terrorism, innovation and science and technology, skill development, urban infrastructure, railways and civil aviation, clean energy, development cooperation, health and alternative medicine.  CONCLUSION  This Modi-Merkel meeting was about continuing with the partnership, and putting it on fi rmer ground. Both countries will work together on issues such as UN reforms, expansion of the UN Security Council, India’s inclusion in export control regimes such as the Nuclear Suppliers Group, tackling terrorism, and the adoption of the Comprehensive Convention on International Terrorism.  In the future, India and Germany has the opportunity to deepen this partnership when they meet for the G-20 summit in July in Hamburg. It will be another chance to demonstrate why India and Germany are good for each other.

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Japan

Present Highlights of India and Japan Relation  Common Problem. Both have complex territorial disputes with China.  Global Partnership with a Strategic Orientation  Comprehensive Economic Partnership Agreement (CEPA) between India and Japan being implemented from August 2011  India the highest recipient of Offi cial Development Assistance (ODA) from Japan. ! Rs.10500 crore to fund six infrastructure projects in India. ! Includes various phases of Metro rail projects in Delhi, Chennai & Kolkata. ! ODA from Japan crossed 1.55-lakh crores  Signed a Civil Nuclear Cooperation Agreement “In Principle”  India Holds Annual Summit Meetings with only Japan & Russia. Flashpoints of India-Japan Annual Summit (December 11-13, 2015)  The bullet train project between Mumbai and Ahmedabad  Japan’s investment plans to cover schemes like “Make in India” and Swachh Bharat  Nuclear cooperation  Defence cooperation – Transfer of Technology  Japan’s support to India’s presence in the Asia-Pacifi c region  A Partner City agreement was signed between Varanasi and Kyoto Civil Nuclear Agreement  Concluded a civil nuclear cooperation agreement “in principle”  Signed MoU for peaceful uses of nuclear energy  The civil nuclear agreement would go through legal and technical procedures before it is opened up to scrutiny by the Japanese Parliament.  It would be signed after the technical details were fi nalised India and Japan Signed 15 Other Agreements  Transfer of defence equipment and technology cooperation  Mumbai-Ahmedabad Bullet Train project.  ‘Visa on arrival’ to all Japanese nationals from March 01, 2016.  Opportunity to 10,000 Indian youth under the student exchange programme.  The Chennai-Bengaluru Industrial Corridor project  Agreements on railways, tax, science, health & education also signed.  Fostering bonds between India’s States and Japan’s Provinces. Japan’s Financial Assistance to India  Mumbai-Ahmedabad bullet train project at a cost of $12 billion (Rs.98,000 crore)  Interest rate of less than 1 per cent.  “Make In India” - Japan created a $12 billion fund for mfr in India  Japan pledged another $5 billion as part of its ODA.

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Defence Agreements  TFR of defence equipment and technology.  Security measures for protection of classifi ed military information.  India announced that Japan would now participate regularly in Indo-US Malabar bilateral maritime exercise, turning it into a trilateral initiative.  Joint Statement – ‘India and Japan Vision 2025. Special Strategic and Global Partnership Working Together for Peace and Prosperity of the Indo-Pacifi c Region and the World  Strengthen the foundations of deep strategic ties.  Two-way collaboration and technology cooperation, co-development and co-production.  Explore potential future projs on defence equipment & technical cooperation as US-2. Military and Strategic Agreements  Decisive steps in the security cooperation between India and Japan.  Deepen the defence relations and promote defence manufacturing in India.  Make Japan a partner in the Malabar Naval Exercises  India’s fl agship “Make in India” initiative would benefi t from the defence co-production plans  Japan would take up production of US-2 amphibious aircraft.  Japan will work with India and the US for peace, security, freedom of navigation, in the SCS and the important energy lanes of Indo-Pacifi c region. Deepening the Economic Ties  For the fi rst time Japan would import Maruti cars manufactured in India.  Historic decision to introduce the high-speed rail in Mumbai-Ahmedabad sector through Shinkansen  It is known for its speed, reliability and safety. Elevating Bilateral Relations into “Spl Strategic & Global Partnership  Signifi cant for Asia in the perspective of balance of powers in the region  Japan moves towards ‘Collective Self-Defence’ ending 69 years of Pacifi st Defence Policy  China becoming increasingly assertive in the Indo-Pacifi c region, the Sino-Japanese rivalry has increased.  Security cooperation in the Indo-Pacifi c region is driven by the shared concern about China’s increasing assertiveness in the region.  CONCLUSION

Natural Ally  No Confl ict of Strategic Interest  Long-term strategic interests of India and Japan coincide.  Share Common Goals of Building Stability, Power Equilibrium and Multilateral Cooperation in Asia Economic Ties Mutually Benefi cial  Japan has aided infrastructure projects in India with many in pipeline.  Indian markets could stimulate Japan’s economy  Japan could meet India’s growing needs for capital and technologies

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UN Reforms  Need to work together as both are Aspiring for Permanent Security Council Seats  They need to convince China about the positive impact on Asian peace and stability due to the presence of three Permanent members in the UNSC. Growth in bilateral relations:  Ties between India and Japan have been building up across all fi elds, particularly defence and security. This assumes signifi cance in face of Chinese claims in South China Sea and Arunachal Pradesh along with threats from Pakistan and North Korea in the region.  For India, it is imperative to strengthen the bonds of friendship with Japan since the success of India’s “Act-East Policy” largely depends on Japanese participation.  Japan also happens to be one of the biggest investors in India and Tokyo’s fi nancial and technological backing holds the key to building infrastructure in India’s northeast. Traditionally, Japan has been the major economic development partner for most South Asian countries, but Beijing’s expanding infl uence beyond the South China Sea and across the Indian Ocean region has left Tokyo feeling vulnerable.  The transactional approach of the current USA administration may be seen as an important factor contributing to growing rapport between India and Japan. With an aim to cut a deal with Pyongyang, Washington has been opening up to North Korean regime in recent months. However, this is unlikely to please Japan, which has long-standing concerns about the reckless behaviour of the North Korean dictator.  Given the traditionally sound ties between the two countries coupled with growing strategic convergence between them, Japan fi nds it useful to elevate India’s position in Japan’s Indo-Pacifi c strategy.  There is a growing realisation of the signifi cance of the Indo-Pacifi c region in fast-changing geopolitical landscape of Asia, which has challenged the existing security architecture. The US, Japan and Australia are faced with Chinese assertiveness in the Western Pacifi c. And in the Indian Ocean, India and the US are faced with an increasing Chinese presence.  Japan seeks to bolster cooperation with many Asian and African countries based on its ‘Free and Open Indo-Pacifi c Strategy’ aimed at keeping in check the growing maritime assertiveness of China.  Shinzo Abe argued in his 2007 speech in Indian Parliament that if India and Japan came together, the “broader Asia will evolve into an immense network spanning the entirety of the Pacifi c Ocean, incorporating the United States of America and Australia. Open and transparent, this network will allow people, goods, capital, and knowledge to fl ow freely.”  It is therefore not surprising that upholding principles such as freedom of navigation and countering threats to Japanese shipping remains fundamental to Japanese foreign policy.  Without any doubt, China is the elephant in the room when it comes to defi ning close partnership between India and Japan. China’s growing military strength and rising economic power have prompted other democracies, including India and Japan, to sit up and take notice. Amid growing concerns about China’s Belt and Road Initiative (BRI), New Delhi and Tokyo have stepped up their cooperation for creating a viable alternative for infrastructure development and connectivity among countries.  Since bilateral cooperation between India and Japan is closely intertwined with trilateral cooperation with the US, it is but natural for Japan to expect India to play an increasingly active role in the Quadrilateral Security Initiative (referred to as the Quad) while affi rming the importance of freedom of navigation and rule of law.  But India remains hesitant on the Quad, which is likely to cause confusion among other three partners – the US, Japan and Australia. It was this confusion which prevented India from allowing Australia to become a part of the Malabar naval exercises.  So far, India has also decided to stay away from a joint initiative launched by the US, Japan and Australia to fund infrastructure projects to counterbalance the BRI in the Indo-Pacifi c region. India’s participation in this important infrastructure initiative would have reassured the other members of India’s commitment to the grouping.

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PM Modi’s visit to Japan

Key Outcomes A $75 billion currency Investment commitment of 320 swap agreement billion yen by Japanese companies (Will allow central banks of both countries to ⬉ ⬈ exchange local currencies.)

Initiation of a new ‘2+2 Beginning of negotiations dialogue’ comprising on ACSA (Acquisition and of foreign and defence ⬋ ⬊ Cross Servicing Agreement) ministerial dialogue (Like LEMOA (similar to the one held between India-USA) between India-USA recently)

India- Japan Relations : Convergence Economic Soft loans/investment in numerous infrastructure projects need and opportunity (e.g. Delhi-Mumbai Industrial Corridor, Bullet trains , Infra projects in NE India, etc) Both countries are in world’s top 10 economies → huge opportunity for economic Signing of CEPA to enhance bilateral trade convergence. Major milestones so far : (Comprehensive Economic Partnership Agreement)

Signing of civilian nuclear agreement (despite India being a NPT non-signatory)

Signing of defence Defence and strategic cooperation agreement (2006) need and opportunity

Geopolitically, both have interests in the indo - Military exercises are in upswing pacific region and can play big roles in [Dharma Guardian , JIMEX and Malabar (with USA) exercises in 2018] securing the region . Progress so far : Various recent measures like negotiations (esp. in light of a belligerent China) on ACSA, US-2i amphibian aircraft, etc

Japan has a greying population seeking business opportunities Enhancing India needs technology and and depends on sea lanes for cooperation for a investments for its growth → Japan its resource needs → India can win-win situation can play a huge role here play a huge role here

Way Ahead

Quadrilateral Asia - Africa Grouping Growth Corridor (India-Japan-USA-Australia): This is proposed as a strategic This is proposed as a counter group to secure the Indo-Pacific region. Enhancing this to China’s BRI by the grouping will uphold freedom of navigation and rule of law. quadrilateral grouping. Bottomline

India’s ‘Act East’ outreach fits well with Japan’s vision for a ‘free and open Indo-Pacific’ , both economically and geopolitically. This natural convergence needs to be backed up with appropriate diplomatic measures.

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13th Annual India - Japan Summit  The prominent outcomes of the summit are: ! Currency Swap Agreement: A 75 billion Currency Swap Agreement which will allow the central banks of both the countries to exchange local currencies. In contrast, Japan has such an agreement in place with China as well, but only for 75 billion Currency Swap Agreement which will allow the central banks of both the countries to exchange local currencies. In contrast, Japan has such an agreement in place with China as well, but only for 30 billion. ! 2+2 dialogue: Initiation of a new Foreign and Defence Ministerial Dialogue, termed ‘2+2’, was announced to further strengthen the bilateral dialogue mechanism between the two countries. ! Acquisition and Cross-servicing Agreement: Beginning of negotiations on an Acquisition and Cross-servicing Agreement, (on the lines of LEMOA between India and USA). This will be a logistics-sharing pact, which will allow both countries to share defence capabilities and supplies including fuel and ammunition. ! Investment commitment: of 320 billion yen by Japanese companies in India.

Appendix: Asia-Africa Growth Corridor (AAGC)

 In May 2017, at the 52nd annual meeting of African development bank held in Gandhinagar, India and Japan unveiled a vision document for the development of Asia Africa Growth Corridor.

ORIGIN OF AAGC:  This Asia Africa Growth Corridor was fi rst proposed by India and Japan in November 2016.

DETAILS OF THE PLAN: Objective: It has two broad objectives:  Developing Sea Corridors  To create a “free and open Indo-Pacifi c region” by rediscovering ancient sea-routes and creating/ new sea corridors that will link the African continent with India and countries in South-Asia and South-East Asia.  For instance, under the AAGC, there is a plan to connect ports in Jamnagar (Gujarat) with Djibouti in the Gulf of Eden and Mombasa with Zanzibar will be connected to ports near Madurai  India is developing ports under the Sagarmala programme specifi cally for this purpose.  Build infrastructure  Apart from developing sea corridors, robust institutional, industrial and transport infrastructure will be developed in growth poles among countries in Asia and Africa.  This will integrate the two regions and will enable emergence of Asia and Africa as a globally competitive economic bloc.  Four key pillars: The vision document proposes four key pillars that leverage the strengths of India and Japan:  Enhancing capacity and skills;  Building quality infrastructure and connecting institutions;  Development and cooperation projects in health, farming, manufacturing and disaster management; and

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! People-to-people partnerships.  Five focal points: The AAGC consists of fi ve remarkable focal points: ! Effective mobilisation of fi nancial resources; ! Their alignment with socio-economic development and development strategies of partner countries and regions; ! Application of high-quality standards in terms of compliance with international standards established to mitigate environmental and social impact; ! Provision of quality of infrastructure taking into account aspects of economic effi ciency and durability, inclusiveness, safety and disaster-resilience, sustainability as well as convenience and amenities; and ! Contribution to the local society and economy.  What are the proposed plans under this project? ! More details are likely to be fi rmed up by September, 2017 when Japan’s PM Shinzo Abe will visit India.  How will India and Japan contribute to the project? ! Japan will build quality infrastructure, while India will bring in its expertise of working in Africa. How will it be a Win-Win Situation for India, Japan and Africa?  Synergy between act east policy and Expanded Partnership for Quality Infrastructure: As the Indo- Pacifi c region will be “the key driver for prosperity of the world”, the two leaders have decided “to seek synergy” between India’s “Act East Policy” and Japan’s ”Expanded Partnership for Quality Infrastructure”. Thus launching of AAGC is a right step in this direction.  This will turn the 21st century into an Asian-African century, and not just an Asian century.  Participate in Africa’s growth story: It is a key step in participating in growth story of some African nations.  Increasing footprint in Africa: Another objective is to curtail the Chinese presence on the continent by increasing their investment in Africa. In 2015-16, the country invested a whopping USD 38.4 billion (24 per cent of total green-fi eld investment). In comparison, India invested just USD 2.2 billion (1.3 percent of total green-fi eld investments). Japan investments at present are minuscule.  To counter china’s OBOR: The vision document was unveiled days after China’s ambitious One Belt, One Road (OBOR) initiative took off. Thus experts are seeing it as a step to counter china’s OBOR initiative. India has great trade and network experience in Africa, and Japan has very advanced technology. This combination will give China tough competition for market share.  Benefi ts for Africa: It will also contribute towards achieving the “High priorities” which according to African Development Bank are crucial for accelerating Africa’s economic transformation. These high 5 priorities are (i) Light up and power Africa, (ii) Feed Africa (food security), (iii) Industrialize Africa, (iv) Integrate Africa (transportation), and (v) Improve the quality of life for the people of Africa (skill development, health and sustainable development). How it is Different from China’s One Belt One Road (OBOR) Project?  Land vs water: OBOR mainly entails development of a land corridor, whereas AAGC entails development of a sea corridor.  Coverage: Europe is not a part of AAGC, but in OBOR, Europe is a major focus area.  Cheaper and less carbon footprint: The project stakeholders believe that the sea corridors will be “low-cost” and have “less carbon footprint” when compared to a land corridor.  More open: As compared to OBOR, AAGC is more open. It will be based on more consultations as opposed to government funded OBOR (OBOR was presented with least consultations).  More inclusive: As compared to OBOR, AAGC is more inclusive. It will keep people as the centre piece rather than just trade and economic ties.

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Way Ahead?  India and Japan should realise that they do not have the luxury of time in view of China’s rapidly expanding footprint in Africa.  An urgent need exists for them to increase the scope of their development projects, create synergy among themselves, engage proactively with other willing partners, and thus turn the concept of the AAGC into a viable reality.  In this direction, India and Japan should initiate a few joint pilot projects along with Kenya, Ethiopia and Mozambique in identifi ed areas such as health care, agriculture and blue economy.

France  In the post-Cold War period, France was the fi rst country with which India established a ‘strategic partnership’. The only major Western power that described the U.S. as a hyper power and openly espoused the virtues of multi-polarity found a natural ideological convergence with India’s ambitions of seeking strategic autonomy.  After the nuclear tests in May 1998, when India declared itself a nuclear state, France was the fi rst major power to open talks with the country. Within weeks, the Special Envoy of Prime Minister Atal Bihari Vajpayee, Brajesh Mishra, was received in Paris by President Jacques Chirac, who not only gave him a patient hearing but also appreciated India’s political and security compulsions.  While the India-U.S. nuclear dialogue between India’s then External Affairs Minister Jaswant Singh and U.S. Deputy Secretary of State Strobe Talbott attracted greater media attention, the strategic dialogue between Mr. Mishra and his French interlocutor Ambassador Gérard Errera made signifi cant progress behind the scenes. One reason was that the French never talked of “cap, rollback and eliminate” as the U.S. non-proliferation lobby did, but focussed instead on developing an understanding of Indian thinking about the region. Key Takeaway from Prime Minister’s Recent Visit to France  Purchase of 36 Rafale fi ghter aircraft as quickly as possible: In a signifi cant development, India signed a deal to buy 36 Rafale fi ghter aircraft as quickly as possible. The aircraft are manufactured by the French company Dassault Aviation. The decision to buy the aircraft bypasses the plan under which the Indian Air Force was to buy 126 Rafale fi ghters, “of which 108 would be produced at a state-run Hindustan Aeronautics Limited (HAL) plant in Bengaluru as part of India’s efforts to build a domestic military industrial base”.  Some headway on Jaitapur atomic power plant: The other signifi cant takeaway relates to civilian nuclear energy. India and France signed a deal for the Jaitapur nuclear plant, located in the Konkan region (Ratnagiri district) of Maharashtra. The deal is signifi cant. France’s state-owned nuclear company, Areva, also signed a deal with Larsen and Toubro Ltd to “maximize the localization for the Jaitapur project”.  Increased French investment: French President Francois Hollande, in his joint statement with Modi, announced that France would invest €2 billion in India and develop three smart cities in the country. It was agreed to include Smart City cooperation as an area of technical cooperation under the October 2012 MoU (memorandum of understanding) on Cooperation in the Field of Sustainable Urban development between France and India.  Indian Railways and France’s French National Railways signed a railway protocol, under which the two countries will work closely in the upgradation of the semi high-speed Delhi-Chandigarh line to 200 kmph, and the redevelopment of Ambala and Ludhiana railway stations. About Rafale deal  Background to deal ! The Medium Multi-Role Combat Aircraft (MMRCA) competition, also known as the MRCA tender, was a competition to supply 126 multi-role combat aircraft to the Indian Air Force (IAF).

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! In 2012, Rafale was chosen as the Medium Multi-Role Combat Aircraft (MMRCA) for the Indian Air Force (IAF) after a stringent technical evaluation and global tender process which has lasted a decade. ! That tender proposed the following ! Purchase of 18 Rafale aircraft in “fl y-away” condition, and ! Rest 108 to be manufactured in India under transfer of technology by state-owned Hindustan Aeronautics Limited (HAL).  Subsequent technicalities of the tender currently being negotiated by the Ministry of Defence with Dassault, Rafale’s manufacturer.  Subsequently, the deal has been mired in controversies. It has been alleged that Dassault Aviation has ! Refused to transfer technology, ! Increased the price in violation of the original tender, and ! Refused to take charge of timely deliveries for the aircraft produced in India.  Deal clinched at Modi’s visit to France  About the deal – ! Under a separate/new deal, India asked France to supply 36 Rafale fi ghter jets instead of 18 in “fl y-away” condition ! This is under a government-to-government deal, unlike the tender currently being negotiated by the Ministry of Defence with Dassault, Rafale’s manufacturer. ! When will be delivered – not clearly mentioned, just mentioned that “as quickly as possible” so as to meet IAF’s requirement. Being a G2G deal they will be delieved on time. ! The announcement, however, doesn’t talk about making Rafale in Hindustan Aeronautics Ltd (HAL), a core proposition of the original tender.  Summary Comparison – then & how Then Now

 How many  Buying 18 aircraft from Dassault in  Number of aircraft to be fl y-away condition while the rest 108 purchased in fl y-away condition were to be manufactured in India has increased to 36. under transfer of technology by state-owned Hindustan Aeronautics Limited (HAL)

 Between  Govt (ministry of defence) was  It is a G-to-G deal. whom negotiating with Dassault

 Cost  Not desclosed  It is lower then the earlier one

Critical comment – Positives:  IAF, which has been in desperate need of fi ghter jets. From stipulated strength of 42, the IAF is now down to 34 operational squadrons (as of April 2015)  This is way of rapidly alleviating the IAF’s most immediate concerns, while leaving room for future negotiations. i.e. a middle path  As it is a government-to-government deal, India should be able to get these aircraft cheaper. The negotiations over price are still on but experts estimate at least a 10% lower price for these 36 aircraft.

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Negatives:  Against make in India ! The announcement, however, doesn’t talk about making Rafale in Hindustan Aeronautics Ltd (HAL), a core proposition of the original tender. This multi-billion dollar procurement thus runs contrary to Prime Minister Narendra Modi’s Make in India plan for the defence sector. ! Window for Make in India I existing deal – In this current 36 aircraft deal, there is still an opportunity to promote defence manufacturing, particularly in the private sector. Under the provisions of the Defence Procurement Procedure (2013 revised), the maintenance transfer of technology contract for these 36 Rafale fi ghters must be given to a private-sector vendor instead of the public-sector HAL. ! Window for make in India future deal – Also the deal has only decided about the 26 out of 126. So there is still room open for negotiations the other 90 MMRCA. For that it should make make in India a precondition.  Procurement – ! It sets a precedent for future defence procurements. ! The government should be careful to not go down that road. It should, instead, identify the reasons for India’s long-winded defence procurement process, where foreign suppliers either end up getting blacklisted or get entangled in protracted negotiations. Defence Minister Manohar Parrikar has already promised a streamlining of the defence procurement process in line with the Make in India programme. The earlier he does it, the better. What about the original tender – has ended  Couple of days later, defense minister said that all future deals for Rafale fi ghters would also be through government to government route, indicating that the USD 20 billion MMRCA tender has virtually been scrapped.  Noting that MMRCA negotiation had entered into a “loop” or a “vortex” with no solution in sight, Defence Minister Manohar Parrikar said direct negotiations with France will now decide how much more Rafale has to be bought and if it will be under ‘Make in India’ programme.  The minister refrained from giving a direct reply to questions whether requirement of Air Force for more MMRCA will be through Rafale or if any other player can come into action.  There are serious differences over almost every major aspect of the deal such as: ! French side’s concerns about what role a major Indian private conglomerate would play in the deal. ! Debate over offset clause – While the MMRCA (Medium Multi-Role Combat Aircraft) deal — the precursor to the present Rafale deal — had 50 % offset, and most of its fi ghters were to be assembled in India, the deal under negotiation is for off-the-shelf purchase of 36 fi ghters from France. ! Final price of the fi ghter.

Russia

 INDIA – RUSSIA RELATIONSHIP BACKGROUNDER  A cordial relationship with India that began in the 1950s represented the most successful of the Soviet attempts to foster closer relations with Third World countries.  The relationship began with a visit by Indian Prime Minister Jawaharlal Nehru to the Soviet Union in June 1955 and Khrushchev’s return trip to India in the fall of 1955. While in India, Khrushchev announced that the Soviet Union supported Indian sovereignty over the disputed territory of the Kashmir region and over Portuguese coastal enclaves such as Goa.  The Soviet Union declared its neutrality during the 1959 border dispute and the Sino-Indian war of October 1962, although the Chinese strongly objected.

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 Indo-Soviet Treaty of Friendship and Cooperation signed in August 1971, became the milestone in relation.  However, with the fall of USSR, the Indo-Russia relation saw a sea change. India inclined towards West.  Traditionally, the Indo-Russian strategic partnership has been built on fi ve major components: politics, defence, civil nuclear energy, anti-terrorism co-operation and space. However, in recent years a sixth component, economic, has grown in importance with both countries setting a target for US$30 billion in bilateral trade by 2025.

Growing distance between Delhi and Moscow  Bilateral trade is not gaining traction between the two countries. There is an urgent need to prioritize economic ties, which have been going downhill for some time. Though the two nations have set a target for their bilateral trade of $30 billion by 2025, it was a measly $7.8 billion in 2015.  Russia’s growing tilt towards Pakistan ! There is concern in New Delhi that Moscow’s decision to side with China would help Pakistan get away from global isolation. ! At the 2016 BRICS summit in Goa, Russia did not back India’s demand to name two Pakistan- based terror groups as perpetrators of terrorism against India, thereby shielding Pakistan from censure. ! On Afghanistan issue, Russia wants to give greater role to Pakistan and China, unlike India. ! Pakistan is becoming potential buyer of Russian arms, which would provide elixir to the dying economy of the latter. ! Moscow and Islamabad held their fi rst joint military exercise in September 2016 and their fi rst bilateral consultation on regional issues in December. ! Russia lifted an arms embargo against Pakistan in 2014 and will send four Mi-35M attack helicopters this year. Russian troops participated in this year’s Pakistan Day military parade. ! China-Pakistan Economic Corridor linking Xinjiang to the Pakistani port of Gwadar could be merged with the Russia-backed Eurasian Economic Union.

St. Petersburg’s declaration  Sanskriti se Suraksha ! PM Modi said the ties between India and Russia span the spectrum from Culture to Defence (Sanskriti se Suraksha). ! It covers all areas of cooperation, including in the spheres of political relations, security, trade and economy, military and technical fi eld, energy, scientifi c, cultural and humanitarian exchanges, and foreign policy.  Energy bridges ! Energy cooperation is one of the cornerstones of the relationship between India and Russia. ! Both sides strive to build an “Energy Bridge” by having energy cooperation in all areas including nuclear, hydrocarbon, hydal and renewable energy sources. ! Nuclear power: The growing partnership in the nuclear power sector provides an opportunity for developing advanced nuclear manufacturing capabilities in India in line with the “Make in India” initiative. Both sides have committed themselves to implement the “Program of Action for Localization in India” which was signed in 2015. ! Exploration of Arctic shelf: India is interested in launching joint projects on exploring Hydrocarbons in the Arctic shelf of the Russian Federation.  Economic ties ! Diversifi cation (High Technology Products): The two sides should diversify their trade in goods and services with special focus on high technology products.

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! Investment target: India and Russia are close to achieving the target of 30 billion US dollars worth of investment by 2025. ! Joint projects in other countries: The two sides have decided to undertake joint development projects in other countries. ! Eurasian Economic Union: The two sides will commence discussions on a Free Trade Agreement between the Eurasian Economic Union and the Republic of India. ! Startups: PM Modi mentioned the “bridge to innovation” to promote startups and entrepreneurship  Strategic ties ! Joint exercises: The two countries will hold the fi rst tri-Services exercises, named ‘Indra-2017,’ in 2017. ! Defence production: The two sides have decided to jointly produce Kamov 226 helicopters and frigates.  Cooperation on International issues ! Asia Pacifi c region: To build well-balanced security architecture in the Asia-Pacifi c region, the two sides have decided to develop a relevant dialogue in the framework of the “East Asia Summit”. ! Afghanistan: The two sides have decided to coordinate for achieving national reconciliation in Afghanistan. ! UN: Russia reiterated its support for India’s candidature for a permanent seat in a reformed United Nations Security Council. ! Cooperation in other forums: To establish a multi-polar global order and have a infl uential role in global affairs, the two sides will continue to cooperate in other multilateral organizations including Shanghai Cooperation Organization, BRICS, Russia-India-China cooperation, WTO and G20. ! Export control regimes: Russia reiterated its support for India’s earliest admission to the export control regimes namely Nuclear Suppliers Group and the Wassenaar Arrangement. ! Connectivity: The two countries are cooperating in the International North South Transport Corridor. ! Terrorism: The two sides asserted their willingness to fi ght international terrorism.  Cultural ties (soft power) ! There exists deep awareness of Yoga and Ayurveda in Russia. ! We should further develop bilateral contacts in the sphere of culture and sports by organizing annual festivals and exchanges. ! Bilateral cooperation in the sphere of education offers great opportunities which should be explored by promoting direct contacts among universities and providing assistance to students from the two countries.  Exploring new avenues of cooperation ! Transportation  India should utilize the strength of Russia in shipbuilding, river navigation and desalination technologies to develop it’s inland waterways.  The two sides have also decided to cooperate in development of high speed railways. For this they have signed an agreement for implementation of the high-speed service at the Nagpur-Secunderabad section.  Science and technology: ! Bilateral cooperation in the sphere of Science & Technology offers great opportunities, since both sides are committed to address global challenges like Climate change and Cyber security.

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! Cyber security: India has much to learn from the Russian experience of cyber security. Russia, home to leading cybersecurity companies like Kaspersky, has also built considerable state capabilities towards establishing an effective and robust cyber force. ! Space: There are ample opportunities for bilateral cooperation in space research. ! High-technology products: Special emphasis should be on increasing the share of high- technology products in bilateral trade. The two countries have already established a High Level Committee on Cooperation in High Technologies.  CONCLUSION  It is a trying time in the relation between India and Russia. Both the countries are going through rough patches in old romance they have had in the past.  It is high time for India to redefi ne its relation with Russia in its greater interest.  Energy co-operation and defence deal can be the game changer.  Changing geo-political scenario in the world over will have the fi nal say in this bilateral relation.

APPENDIX-I: Decline in Indo-Russia Relations

Period of upswing:  As strategic relations go, few countries can match the enduring partnership that India and Russia have shared since the 1960s. For close to half a century Russia has been New Delhi’s foremost military supplier.  In fact, defense trade became the raison d’être for strategic relations between the two nations – particularly in the post-Cold War era. Decline in military relations:  Yet Russia’s share of military sales to India is now in steady decline. In consonance with India’s enhanced geopolitical status and strategic rapprochement with the U.S., New Delhi has found new partners in the West. And what was once the defi ning aspect of the bilateral relationship with Russia is threatening to become a heavy burden for both partners.  This shift has been a decade in the making and can be traced back to the 123 Agreement that India signed with the U.S. What followed was a reversal of a decades old non-proliferation policy that culminated in the signing of the Indo-U.S. civil nuclear agreement in 2005. America’s strategic rapprochement with New Delhi marked a watershed moment in India’s defense engagement with the world. Sanctions against many Indian defense entities were lifted and high technology export controls were slowly eased.  Foreign aerospace and defense majors were given expanded access to Indian markets and within the space of a decade Indo-Israel defense trade rose to $10 billion, while India’s defense trade with the U.S. has since topped $9 billion.  All this has had an adverse impact on Indo-Russian defense trade. Despite robust numbers in absolute terms, Russia’s share of India’s defense pie will continue to fall, at least in the short term. In recent years, the Kremlin has lost out to other emerging export hubs for big-ticket Indian defense contracts. These include, amongst others, the 36 MMRCA contract worth $7 billion to France; 10 C-17 Globemaster-III strategic airlift aircraft worth $4.1 to the U.S. and eight P-8I maritime patrol aircraft worth $2.1, again to the U.S.  At present, Russia’s defense industry is sustaining its considerable ties with India on the strength of the execution of contracts already in place. Barring the upcoming $11 billion contract for the joint design and development of the Fifth Generation Fighter Aircraft (FGFA) program with Russia, there are no specifi c plans to purchase new Russian arms.

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Pakistan-Russia military relations:  Already there is trouble brewing on the horizon; all signs point to Russia downgrading its military- technical relationship with India from that of an exclusive partner to a preferred partner. Such pragmatism should come as no surprise given that India has diversifi ed its own military import portfolio and no longer considers Russia as its exclusive trading partner. Russian military export overtures towards Pakistan are now perceptible. In a noteworthy development, Russia recently decided to supply Mi-35 Hind attack helicopters to Pakistan.  Prior to this, Moscow had refrained from supplying lethal military equipment to Pakistan on account of New Delhi’s strained relationship with Islamabad – the legacy of this Indo-Russian military exclusivity can be traced all the way back to the Indo-Soviet Treaty of Friendship, Cooperation and Peace of 1971.  This shift is signifi cant, and is driven by Moscow’s “compulsive” need to sell weapons. One of the most important issues following the dissolution of the Soviet Union was the distribution of its external state debt. However, Russia did not inherit an equally robust economy

Sino-Russia military relations:  The recent upsurge in Sino-Russian military cooperation has also not gone unnoticed in India.  By selling the advanced Su-35 fi ghter aircraft to China, Russia is potentially creating a confl ict of interest for itself. With every sale of military equipment to China, Russian military hardware becomes less appealing in the Indian market; this is particularly true for the aerospace sector, where a major portion of the Indian Air Force fl eet is made up of Russian imports.  Some argue that the confi guration of equipment supplied to India surpasses that which is supplied to China  Going forward, a period of dissonance is to be expected, before India and Russia can adjust to the realpolitik of the present.

Appendix-II: Why RIC is as Important to India as JAI and BRICS?

 RIC was the fi rst meeting of the heads of government of the three Eurasian powers in 12 years.  Conceived by the then Russian foreign minister Yevgeny Primakov in 1998, much before BRICS, the idea of the RIC never really took off unlike the BRICS, despite occasional meetings on the side-lines of the UN General Assembly and other multilateral meetings.  However, this time, the three countries have agreed to hold regular summits from now on at all levels to jointly promote peace and stability.  They emphasised on the need to promote multilateralism, reform institutions of global governance like the UN and the WTO and highlighted the need to work together to steer global economic governance.

 ABOUT

Russia-India-China (RIC) trilateral  Together, the RIC countries occupy over 19 percent of the global landmass and contribute to over 33 percent of global GDP.  All three countries are nuclear powers and two, Russia and China, are permanent members of the UN Security Council, while India aspires to be one.

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Japan-USA-India (JAI)

 In the recently held G-20 meeting at in Buenos Aires, Prime Minister Narendra Modi termed the India-US-Japan partnership as “JAI” or victory and said that the partnership between the three nations would go a long way in ensuring world peace and prosperity.  India, Japan and the United States have agreed that a “free, open, inclusive and rules based” order is essential for the Indo-Pacifi c’s peace and prosperity as the leaders from the three countries held a trilateral meeting for the fi rst time, amidst China fl exing its muscles in the strategic region.  The leaders also agreed to the central role of ASEAN and they also agreed to work on maritime and connectivity issues and to synergise eff orts in this regard.

Importance of RIC  For Russian President Vladimir Putin, the RIC meeting on the side-lines of the G-20 was a message to the West that despite their shunning him, he still has friends like India and China.  For China, the RIC provides a platform where it can push its interests in Eurasia.  Further, any holistic, stable security architecture on the Eurasian landmass cannot develop without having Beijing, Delhi and Moscow on board and the RIC offers the ideal forum for this. Importance of RIC for India  Though apparently an unlikely troika due to the historical differences between New Delhi and Beijing, what binds the group together is the now strong partnership between Beijing and Moscow and the time-tested relations between Moscow and New Delhi.  So, in this sense, Russia becomes the bridge between India and China, since it enjoys strong relations with both.  Moreover, the RIC forms the core of both the Shanghai Cooperation Organisation (SCO) and the  India is in a geostrategic sweet spot today. It is being wooed by everyone -- from the smaller powers in East Asia to the bigger powers like the US, Russia and China. The RIC summit is a refl ection of this new found status. India would do well to give RIC the same importance as the JAI group.  The drawback if India focuses only on groupings like the Quad and the JAI is that these groupings essentially revolve around the Indo Pacifi c and will confi ne India to being only a maritime power when it is actually both a maritime and continental power.  It is important for India as an aspiring power to be able to thwart China’s aspirations of being a hegemon in both the maritime and continental spheres.  India cannot cede geostrategic space in the Eurasian supercontinent to China if it wants to be a great power and it understands that Russia alone will not be able to prevent the emergence of China as a hegemon in Eurasia.  Moreover, the RIC is important for India’s ambitions for a variety of reasons. Strategic importance of RIC  Even though India, China and Russia may disagree on a number of security issues in Eurasia, there are areas where their interest converge, like, for instance, on Afghanistan. Primarily, none of them wants an Afghanistan, which is a haven for terrorist activities. So, they could work together as part of the RIC to ensure stable peace in Afghanistan and by extension, in Central Asia.  Regular RIC interactions could also help the three countries identify other issues where they have congruent views like the volatile situation in the West Asia, particularly on issues like the sanctions on Iran.  As the Eurasian supercontinent regains its primacy in world affairs and as the interests of India, Russia and China deepen and clash in the region, it would be useful to have a platform to discuss areas of cooperation and understand the differences.

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Context RIC (Russia-India-China)

Conceived in 1998, the idea of RIC The three countries agreed never really took off. to hold regular summits from However, a meeting of the now on at all levels to jointly grouping took place on the promote peace and stability. sidelines of G-20 summit recently.

Have 19% landmass and 33% Two are members of UNSC Importance of RIC GDP of world and India aspires to be one For Russia For China

In conflict with RIC can provide a West, needs friends platform to push its like India and China interests in Eurasia

For India Russia can act as a bridge in Would help consolidate its the strained relations with geostrategic space in Eurasian China continent as a continental power

form core of both All nuclear BRICS and SCO powers

Economic Importance

Russia is a major exporter of In an increasingly energy and India/China are protectionist world, they major consumers could contribute to creating a new economic order

They could create an ‘Asian energy grid’ to ensure energy security in the region

Strategic Convergence

Despite differences, many areas of strategic convergence exists could work together Afghanistan Address Address on disaster relief (All want to ensure a volatility in fallouts of US and humanitarian stable Afghanistan) West Asia sanctions on assistance Iran

RIC can act as a platform to discuss and address areas of cooperation and understand mutual differences

Bottomline The RIC trilateral is a significant multilateral grouping, because it brings together the three largest Eurasian countries which are also incidentally geographically contiguous.

The recent RIC summit is a continuation of the turn-around in India’s foreign policy after Indian PM’s summit meetings with Chinese President in Wuhan and Russian President in Sochi last year.

For India, groupings like Quad and JAI (Japan-America-India) will only help consolidate its maritime power. RIC can complement its continental ambitions and bring about more balance in its strategic autonomy.

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Economic importance of RIC  The trio could also contribute to creating a new economic structure for the world.  The US, under President Trump, apparently wants to break down the current economic and political order. While the existing structure is not satisfactory, the RIC could offer some suggestions which could be acceptable to the US.  With Russia being a major exporter of energy and India and China being major consumers, the three countries could discuss the creation of an Asian energy grid, which could go a long way in ensuring energy security for the region as well as allow these countries to determine prices suitable to them. RIC importance on Climate Change issue  The RIC countries could work together on disaster relief and humanitarian assistance.  With the Northern Sea Route opening up due to climate change, the RIC has a common interest in ensuring that it is not left to the West and Russia alone and that India and China make the transition from rule followers to rule makers by helping formulate some of the rules governing the Arctic route.  CONCLUSION  The Russia-India-China (RIC) trilateral is a signifi cant multilateral grouping, because it brings together the three largest Eurasian countries which are also incidentally geographically contiguous.  This year’s RIC summit is a continuation of the turn-around in India’s foreign policy after Modi’s summit meetings with Chinese President Xi Jinping in Wuhan and President Putin in Sochi earlier this year. It is an assertion of India’s strategic autonomy, which will hopefully continue well after the general elections to be held in the country in 2019.

UK  India UK relationship has moved out of the colonial mould and is based on equality. It comprises every sphere of possible cooperation strategic, economic, cultural, people to people etc.  Both the countries entered into strategic partnership in 2004. During PM Modi’s visit both agreed on jointly pushing for the UN comprehensive convention on international terrorism (CCIT), and strengthening strategic cooperation and intelligence-sharing through annual consultations and fi ghting terror groups, thus furthering their co-operation in the fi eld. Economic and Trade relations  Economics, stands at the heart of the India-UK relationship. The UK is the third largest source of foreign direct investment in India. And India is the third largest source of FDI (in terms of the number of projects) in the UK, after the US and France.  During 2015 PM Modi’s visit it was announced that Indian railways and others would be raising over £1 billion of rupee-denominated “masala” bond in London.  New British “Centres of Excellence” will be established for key business sectors in India.  The largest Solar power generator in Europe, Light source, will invest a little over $3 billion in India to design, install and manage around 3 GW of solar power infrastructure in India over the next fi ve years in partnerships with Indian companies.  UK is also helping India in Banglore-Mumbai Industrial Corridor.  Indian PM Narendra Modi defi ned UK as India’s entry point to EU. Other areas of cooperation  The countries also launched a new Thames-Ganga partnership for healthy river systems.

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 India can leverage other British advantages as well. From education, health, culture, infrastructure, science, and high-technology to areas such as policing and intelligence, Britain is still a global leader. India needs to keep this in mind as it approaches its engagement with the UK.  New initiatives in science and education such as the Newton Bhabha Fund and an increase in research collaboration from £1m to £150m all add to a strengthening of the relationship and growth in trade.  Britain is keen to share its expertise to help in building capacities in India.

Indian Diaspora  Indian diaspora accounts for 2.3% of Britain total population, is the largest ethnic minority group in the UK,Indian diaspora is very active in all spheres of life in UK. They have very good presence in business, politics etc. Lakshmi Niwas Mittal, Lord Meghnad Desai are notable examples.  They are also the driving force behind India-UK relations. In recent Parliamentary elections slogans in Hindi were used to woo ethnic Indian voters.  They act not only as a bridge between the UK and India, but help enrich the UK through Indian culture.

Issues:  Discrimination faced by them.  Issue of female foeticide and caste discrimination among Indians which have sullied the image of Indians.

Visa issue  Recently UK has increased the fee for non-EU workers seeking UK Tier 2 visa. This is going to signifi cantly affect the entry of talented Indian professionals who have greatly contributed to UK economy.  According to migration data, Indian skilled workers were given the largest number of visas under Tier 2 in the year ending September 2015 and Indian IT workers accounted for 90 per cent of visas issued under the ICT (Intra Company Transfer) route.  Earlier UK had abolished the rule that allowed non-EU students to stay in the UK for two years to fi nd a job which has halved the number of Indian students going to UK.

UNSC Permanent membership  UK has been continuously supporting India’s demand for UNSC Permanent membership on all forums. It has never blinked from that position.

Key challenges that still remain:  Where the UK has failed is in articulating a broader strategic vision for its ties with India. This is related to its failure to view Asia beyond economics and trade.  The UK imports more and more from India, though the level of its exports to the country has recently begun to stutter after several years of growth.  The reduction in Indian students because of Visa issue Cooperation between the U.K. and Indian atomic energy agencies will focus on safety and security issues, but not big enough commercial agreements of the sort seen in India’s nuclear relationships with Australia or France.  The defence relationship between the U.K. and India, crucially important in the decades after independence, has been modest of late and the trip did little to raise hopes.  There is no convergence on global issues like West Asian turmoil.

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 While there were the right noises on policies, there was little to show that the problems of easing business regulations for British companies, and relaxing immigration and visa norms for Indian companies, professionals and students, have been resolved and present professional visa issue will have negative impact on the relations.  Since the UK is too closely aligned with the US, there are limits to how far India can go on security cooperation.  CONCLUSION:  With India seen as more stable than other emerging economies, there is potential for economic ties. With the world increasingly become multi polar, there lies huge potential for deeper engagement between the two nations.  Britain has a vibrant and successful Indian community, contributing much to Britain’s economy. The strength of this community can be used to strengthen economic ties through business councils. There is a need to collaborate at the HRD level, and engage in people to people contact. Also, technology transfer must be encouraged, especially in defence.

Annexure: Extradition And The United Kingdom

 The Indian Government recently has sought an extradition of Vijay Mallaya accused of siphoning off a mammoth Rs. 9,000 crores of loans taken from different banks in India was on run away which India had been trying to extradite him from United Kingdom ever since he fl ed to London last year.  However, Mallya is not the fi rst high-profi le Indian based in the UK and wanted in India. The list of others whom India has sought to extradite includes Lalit Modi (for alleged fi nancial offences), Ravi Sankaran (in the navy war room leak case), Nadeem Saifi (in the Gulshan Kumar murder case) and Tiger Hanif (in the Gujarat blasts case).  But extradition is far more confusing and diffi cult a process than what it sounds like and has proven a tough nut to crack for the government to extradite many from different countries.  The offi cials from India and UK have discussed the wide issue of clearing up bottlenecks in the extradition treaty which was inked in 1992 and focused on speeding up the process of extradition. What is Extradition?  Bilateral, and usually reciprocal, treaty between sovereign states which (upon request) provides for the surrender of person(s) accused of a crime under the laws of the requesting state. Extradition may be barred for offences other than those punishable in the surrendering state, and (commonly) its courts must be convinced that a prima facie criminal case exists.  Extradition plays an important role in the international battle against crime. It owes its existence to the so-called principle of territoriality of criminal law, according to which a State will not apply its penal statutes to action committed outside its own boundaries except where the protection of special national interests is at stake.  In view of the solidarity of nations in the repression of criminality, however, a State, though refusing to impose direct penal sanctions to offences committed abroad, is usually willing to cooperate otherwise in bringing the perpetrator to justice lest he goes unpunished. Position of Extradition in India  In India the extradition of a fugitive from India to a foreign country or vice-versa is governed by the provisions of Indian Extradition Act, 1962. The basis of extradition could be a treaty between India and a foreign country. Under Section 3 of this Act, a notifi cation could be issued by the Government of India extending the provisions of the Act to the country/countries notifi ed.

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Procedure for Extradition in India  Information regarding the fugitive criminals wanted in foreign countries is received directly from the concerned country or through the General Secretariat of the International Criminal Police Organisation (ICPO)-Interpol in the form of red notices. The Interpol Wing of the Central Bureau of Investigation immediately passes it on to the concerned police organizations. The red notices received from the General Secretariat are circulated to all the State Police authorities and immigration authorities.  Action can be taken under the Indian Extradition Act Article No. 34 (b) of 1962. This act provides procedure for the arrest and extradition of fugitive criminals under certain conditions which includes receipt of the request through diplomatic channels ONLY and under the warrant issued by a Magistrate having a competent jurisdiction.  Action can also be taken under the provisions of Section 41 (1) (g) of the Cr.P.C., 1973 which authorizes the police to arrest a fugitive criminal without a warrant, however, they must immediately refer the matter to Interpol Wing for onward transmission to the Government of India for taking a decision on extradition or otherwise.  In case the fugitive criminal is an Indian national, action can also be taken under Section 188 Cr.P.C., 1973 as if the offence has been committed at any place in India at which he may be found. The trial of such a fugitive criminal can only take place with the previous sanction of the Central Government. Position of Extradition in UK  In UK the extradition of a fugitive from UK to a foreign country or vice-versa is governed by the provisions of The Extradition Act 2003.  On 1 January 2004 new extradition law came into force in the UK. This Extradition Act divides countries, with which the UK has extradition treaties, into two categories: Category 1 and Category 2. The extradition procedure varies depending on which category a country falls into. A third category exists in relation to countries with which the UK has an extradition agreement in relation to specifi c crimes.  Many of the changes introduced under the new legislation were intended to address the increased global threat of terrorism in the post-9/11 world. Procedure for Extradition in UK  A country requesting extradition from the UK may either arrange their own legal representation or be represented by the UK’s Crown Prosecution Service. All extradition requests to the UK start at the City of Westminster Magistrates’ Court. Extradition cases were heard at the famous Bow Street Magistrates’ Court until this closed in 2006.  When a request for extradition is made the police will apply to the court for a warrant in order to arrest the individual sought. The papers requesting extradition will then be checked by the Home Secretary to ensure the correct procedures have been followed. If satisfi ed, the Home Secretary will sign an Authority to Proceed. The case will then go before a judge who will decide whether extradition is justifi ed. If the request is approved the individual facing extradition can appeal the decision.  To secure extradition from the UK, the country seeking extradition must usually show that there is suffi cient evidence to bring a court case against the individual to be extradited.  However, the UK has now entered into an agreement with some countries which means that they do not have to satisfy the UK court that there is suffi cient evidence before extradition can take place. This rule applies to EU countries, the USA, Canada, Australia and New Zealand.  In most cases this arrangement is reciprocal meaning that the UK does not have to provide evidence in order to secure extradition of an individual from one of those countries. However, due to a hiatus in the implementation of the necessary law, there is no reciprocal arrangement between the USA and the UK. This means that whilst the UK must supply evidence to extradite from the USA, the USA does not have to provide evidence to extradite from the UK.

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Bottlenecks in Extradition between India and UK:  It is diffi cult to persuade authorities in UK that committing a fi nancial crime makes a person a fugitive. Also, their sensitivity towards any human rights violation makes extradition from England diffi cult for any country.  The dual criminality clause is the key to initiating extradition proceedings, according to the experts. This means the accused has to be charged for an offence that is recognised as a crime in both countries.  But the accused have several grounds of defence, as provided under Article 9 of the extradition treaty between the two nations. A person can challenge extradition citing possible persecution or the “trivial nature” of offence. For Example: Nadeem Saifi , wanted in the murder of T-Series founder Gulshan Kumar, managed to dodge extradition after a prolonged legal battle.  The option to appeal at every level of judiciary, available to a person being extradited from UK, further complicates matters.  There is also the aspect of UK’s crown prosecution arguing the case on behalf of India, “So it depends on how convinced they are”. And most importantly, the onus is on investigating agencies to make a water tight case to ensure extradition.  India’s best chance of getting Mallya back through the extradition route will be to use ED’s money laundering case as Money laundering is a criminal offence in both India and UK.  CONCLUSION  The wide issue of clearing up bottlenecks in the extradition treaty has been discussed between both the countries recently. While the laws of extradition are clear, there are other issues between India and UK which need to be worked upon. For example India has the death penalty while UK does not, in addition to which the issue of prison facilities was also brought up. These need to be addressed in due course.  India’s best chance would be to persuade Mallya to come back. Otherwise, it is a risky, time- consuming as well as expensive process to follow on the path of extradition.

Brazil

 RELATIONS TILL 2000  India and Brazil have a history of political cooperation since the 1960s. Like in 1964, India and Brazil jointly articulated positions in UNCTAD (UN Conference on Trade and Development) and G77. Even in 1967, both the countries condemned the idea of creating Non-Proliferation Treaty (NPT) and instead insisted on using the money not on arms, but by helping the developing nations to fi ght poverty.  It has been active on the multilateral forums but the economic relations were dismal till the early 2000s. Coming of Lula de Silva  Emerging from the diffi cult political past and facing its consequences, the year 2002 for Brazil was proved to be a turning point. Luís Inácio Lula da Silva was elected the President.  Though, the mutual views of India and Brazil took a stronger hold with the creation of IBSA along with South Africa in 2003. Lula made India “a priority” in his fi rst Presidential speech in 2003, which indicated that his government will take ties with India more seriously. India, on the other hand, invited the Brazilian president to grace its Republic Day celebrations by being the chief guest in 2004.  In the same year, India signed the follow-up to the framework agreement with MERCOSUR, which covered 902 products and it came into effect in 2009.

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Relation under the BRICS  The formation of multilateral cooperation of the strong developing economies-Brazil, India, Russia and China in 2009 was touted as the beginning of a new world order. In 2011, South Africa joined the group and the cooperation became unique as a distinct block of South.  The enlarged geographic reach of the group to cover major continents, and the countries being the big regional players, enhances its relevance and growth. All the fi ve countries are G-20 members. And as of 2013, the BRICS countries represent almost 3 billion people with a combined nominal GDP of US$ 16.039 trillion and an estimated US$ 4 trillion in combined foreign reserves. Though BRICS as a group has tremendous potential to grow, it has also received criticism for not having a common vision.  New Development Bank: India and Brazil along with China, Russia and South Africa are the founder member of this Bank which aims to contribute development plans established nationally through projects that are socially, environmentally and economically sustainable and support public and private projects through loans, guarantees, equity participation and other fi nancial instruments. With the creation of permanent institutions the New Development Bank and the Contingent Reserve Arrangement BRICS cooperation has evolved signifi cantly by demonstrating its capacity to produce collective solutions to address contemporary regional and global challenges.  Being the BRICS nations both the county have actively participated in the agreements which have strengthen the bilateral ties between them for example- Fortaleza Declaration, Space cooperation, cyber security and the environmental conservation, G20 etc. Economic relations: present status  Brazil has become one of the most important trading partners of India in the entire LAC (Latin America and Caribbean) region. An India export from Brazil between 2015 to 2016 was around 0.97% of total India’s exports. However, India’s exports from Brazil in July-2016 have shrunk by US$ 13.33 Million a decrease of 7.46% compared to June-2016.  Total import value for Brazil in Jul-2016 was US$ 165.42 Million, and total import value for Brazil in Jun-2016 was US$ 178.74 Million.  The value of EU-India trade grew from €28.6 billion in 2003 to €72.5 billion in 2014.  India with its combination of rapid growth, complementary trade baskets and relatively high market protection, India is an obvious partner for a free trade agreement (FTA) for the EU.  India appreciated Brazil’s efforts to work with MERCOSUL partners for expansion of the India- MERCOSUL Preferential Trade Agreement (PTA), thereby increasing the trade basket from 450 to 2000 items. Opportunities: Areas where we can converge  Both the countries are populous with around 1.26 billion people in India (second position in the world) and Brazil stands at fi fth position with 0.20 billion people inhabiting the country.  This brings along the issue of poverty that plagues India as well as Brazil. Brazil’s Bolsa Familia, part of Fome Zero (Zero Hunger) program was proved successful with direct cash transfer and conditional cash transfer scheme under Lula’s reign.  On the similar lines in India, anti-poverty scheme-Direct Benefi t Transfer (DBT) was launched in 2013 that can function through the Aadhar-enabled bank accounts in targeting subsidies.  The issues of health, universal education, infrastructure needs to be addressed. With the cooperation of IBSA and BRICS as major platforms, India and Brazil can come up with plans to deal with these issues. Also, the developing nations must comply with Millennium Development Goals (MDGs) for their advancement.  Energy: Brazil is considered to have the oldest, most advanced and effi cient ethanol programs in the world. At a time when India imports crude oil for around 4 million barrels per day (bpd), the alternate use of energy is the need of hour. India can collaborate with Brazil and ethanol’s substitution of fossil fuels to meet its energy needs.

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 Brazil acknowledged that a signifi cant number of Indian companies had invested in Brazil with over 50 having a physical presence in areas such as oil, renewable energy, mining, engineering, automotive services, information technology and pharmaceuticals. Challenges  Despite the ties between both the countries emerging on a substantive level, there are certain tasks that need to be delved upon.  The primary one being the enormous distance that needs to be made more conducive for bilateral relations to grow effectively. At the moment, there aren’t direct fl ights to reach Brazil and vice-versa and neither bulk shipping routes exist.  There is a huge vacuum in exchange program for scholars, students and civil society institutions. The student exchanges are diffi cult as there is no agreement to recognize credits from the other country and the visa rules are too cumbersome.  CONCLUSION  India and Brazil are the emerging nations that hold similar principles on democracy, human rights, global governance and liberal strategies. They are partners on the basis of trade relations and have a lot to learn from each other.  Economic and trade relations noting that there remained tremendous potential for further growth and diversifi cation of bilateral trade With their uniting stance on various multilateral and pluri-lateral forums, the two countries are considered to be important for the creation of a new world order. Both the countries have huge potential to grow bilaterally. However, they require aggressive political will to strengthen their association.  The India-Brazil strategic partnership was described as exemplary and mutually advantageous; “distance and language were not seen as constraints as both sides had invested heavily in promoting shared interests and aspirations.

Israel

 INTRODUCTION  2017 marks 25 years of diplomatic relationship between the two countries. The recent visit is taking place after a long period of anticipation, which symbolizes the outstanding relations between the two democracies, initiated 25 years ago. These relations were developed and evolved through the past two-and-a-half decades and reached their peak in the past two years. Trade grew from $200 million to about $4.5 billion in 2016. Taking into account the characteristics of Indian economy, said amount is still very far from the potential.  However, the evolution of Indo-Israeli relations goes far beyond mere fi gures of trade. India is the largest democracy in the world and anticipated to be the youngest and strongest economy within the next two decades. These characteristics, as well as India’s relations with other countries throughout Asia and our region, and shared values with Israel, position India as a strategic partner and even ally.  The relationship between the two countries is considered strategic by both and as such has been supported by the recent government decision to invest more to enhance it even further and to increase the trade by 25% in the same period. At some stages the relationship has gone faster, sometimes not so fast, but it’s been a steady upward trend. Diaspora Connection with Israel  Most of the Diaspora immigrated to Israel in the 1950s and the 1960s, and the large number of them don’t have too many ties back home in India. Most Jewish Indians, about 80,000, have all moved to Israel, and there are just about 4,000-5,000 left in India. So the familial link is not that strong. Also, the community in Israel is not that well-off compared to those in the U.S. and the U.K. People moved there on the basis of their religion, not for economic reasons.

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India Israel Cooperation  During the Cold War, India didn’t have open relations with Israel, leaning heavily in favor of the Palestinians.  In recent years, however Israel has strengthened its security ties with India, and has made the Indian subcontinent one of its major export destinations, primarily in military procurement. Israel is the fourth largest weapons supplier to India. Diplomatic visits between the countries have gradually increased since relations were established. Why there is change in foreign policy?  Foreign policy, rarely designed to serve a single purpose, and is a tool to pursue security, aid, trade, status, and prestige. Change in Indian foreign policy lies in the transition from a political-diplomatic discourse based on idealism to a discourse based on realpolitik. The real politik school holds that a country continually strives toward power, expressed mainly in terms of military capabilities.  Events such as the Arab Spring, the civil war in Syria, and Chinese militarization of the Indian Ocean have caused a reassessment of alliances. The current Indian government regards the Middle East as part of its extended neighborhood, and as critical to India’s national interests. Thus India’s perception of Israel as a military power and exporter of advanced technologies has led to change in outlook. S&T Cooperation  India and Israel together have implemented a large number of cutting edge research projects in applied areas covering Agricultural and Medical Biotechnology; Human Genomics; Advanced Materials & Nanotechnology; Imaging Sensor & Robotics; Solar Energy; Communication & Information Technology; and Lasers & Electro-optics. This has led to new knowledge creation through high impact publications in peer reviewed international journals.  As a follow-up to the India-Israel Joint S&T Committee meeting which was held in Jerusalem earlier in 2016, the two countries agreed to step up the collaboration in the next two years by providing U.S. dollar 1 million from each side to support new R&D projects in the cutting edge areas of ‘Big Data Analytics in Health Care’ and ‘Security in Cyber Space’.  The joint projects will be awarded to the partnering academic and R&D laboratories from the two countries during the next year. As a part of these projects, student exchanges will be encouraged in order to connect the next generation and sustain the pipeline of future collaboration.  This collaborative program is particularly signifi cant in context of ‘Make in India’ and other national missions of the Indian government. The international industrial R&D cooperation of Department of Science & Technology (DST) with MATIMOP, the Israeli Industry Center for R&D, is administered through the Global Innovation and Technology Alliance (GITA) - platform of Confederation of Indian Industry (CII). Defence Deals  In the months leading up to Indian PM’s recent historic visit to Israel, India signed two arms deals, spending $2.6 billion on Israeli missile defense systems.  WHAT ARE THE AGREEMENTS AND TREATIES SIGNED IN THE RECENT VISIT?  The governments have spent time discussing companies that sell medical devices, hi-tech and water systems, and the military ties which is the secretive bedrock of India-Israel relations for decades, have taken a back seat.  Rather than making the visit all about the value of deals signed, Israel’s PM Benjamin Netanyahu and Modi appeared intent on playing up shared culture and values, in the hope that this will give commercial ties deeper roots.  Both the leaders are of the view that the future of the relationship lies in development, which includes agriculture, water, innovation, science and technology. This is where we can impact the largest number of lives of people back in India. Therefore Agreements signed during the current visit were only on non-security issues like water and agriculture.

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Key sectors  A Memorandum of Understanding (MoU) was signed for setting up of USD 40 million worth India- Israel Industrial Research and Development (R&D) and Technical Innovation Fund.  Both the nations are of one view that together our scientists and researchers would develop, build and implement mutually benefi cial solutions. Our decision to establish a bilateral Technology Innovation Fund worth USD 40 million for research in industrial development will help us in achieving this goal.  Two-way trade and investment fl ows are the bedrock of a strong partnership. Both the nations agreed on the need to do more in this direction and businesses on both sides should take primary lead in such efforts.  In the water sector, two agreements were signed to increase cooperation on water conservation and state water utility reform in India. Israel is among the leading nations in the fi eld of innovation, water and agricultural technology and these are also among India’s priority. Agreement on effi ciency of water and resource use; water conservation and its purifi cation; productivity increases in agriculture are key areas in deepening bilateral cooperation.  In the agriculture sector, the two countries have agreed for India-Israel Development Cooperation – a three-year work programme in agriculture from 2018 to 2020.  In the Space Sector, both agreed for cooperation in atomic clocks. Besides, separate MoUs were signed on cooperation in GEO-LEO optical link and cooperation in Electric Propulsion for small satellites.  Both the nations also agreed to do much more together to combat terrorism to protect their strategic interests.

Future Prospects  Connectivity between the two countries is still poor, there are no fl ights from Delhi, and the only direct fl ight from Mumbai by El Al (Israel Airlines) runs just three times a week.  India needs to learn the industry Government cooperation from the Israelis. They have the seamless cooperation between industry, academia and government. We have to learn from their universities, how they have technology transfer companies based right on their campuses, who help convert theory into useful products in a very short period of time.  We have a developed system, but the areas where they have start-ups far exceed what we have. We also need to have Israeli companies look more at the Indian market.  So far, Israeli start-ups have looked at American investors and buyers, but Indian fi rms could do the same with larger markets and cheaper production lines.

Appendix: India’s De-Hyphenated Policy

 INTRODUCTION  Israelis and Palestinians have engulfed in decades of clashes over religion, borders, and territory.  India has chosen to pursue separate relationships with each party. Brief History  India’s relation with Palestine took shape during our freedom struggle against British colonialism. In 1938, Mahatma Gandhi on one hand sympathize for the Jews and on other had said that it is wrong and inhuman to impose the Jews on the Arabs.  In 1947, having been the victim of Partition and going through its horrifi c scenes, India voted

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against the partition of Palestine at the United Nations General Assembly. It should be noted that India was the only non-Arab and Non-Muslim country to do so. Post-Independence also, empathy with Palestine became the essential part of our foreign policy.  In 1974, India became the fi rst non-Arab country to recognise Palestine Liberation Organisation (PLO) as the sole representative of the Palestinians. India was one of the fi rst countries to recognise the state of Palestine in 1988.  India voted in favour of UN Resolution against constructing West Bank wall by Israel in 2003. India voted in favour for accepting Palestine as a full member of UNESCO in 2011.  In 2014, India supported a UNHRC resolution to launch probe into the Israel’s offensive in Gaza.  Thus, India had kept Israel and Palestine relation in balance. But India seems to be more inclined towards Palestine. Why India is pro Palestine?  Minority sentiments: India has been always sympathetic to the Muslim population in Palestine. Because Indian politicians wanted to followed a pro- Palestine approach without hurting the minority sentiments.  Remittances: India did not want to jeopardise the interest of its citizens (more than 7 million) working in Arab countries which are a good source of forex reserves.  Trade: India is dependent on the Arab nations for its larger oil imports. India’s De-hyphenated Policy:  When Indian Prime Minister Narendra Modi came to power in 2014, he instituted a policy toward Israel called de-hyphenation.  Meaning: India’s relationship with Israel would stand on its own merits, independent and separate from India’s relationship with the Palestinians. It would no longer be India’s relationship with Israel-Palestine, but India’s relationship with Israel, and India’s relationship with the Palestinians.  De-hyphenate in international diplomacy simply means having an independent relation with particular country, irrespective of any other country getting offended. Dealing with each country on its own merit. The De-hyphenated foreign policy means the foreign policy with:  Rational Public discourse on various foreign policy aspects.  More pragmatism and more need based approach than the traditional ethos.  Active role of elected representatives in foreign policy.  Using soft power in foreign relations.  Effi cient use of track 2 and track 3 diplomacy to meet the requirements of dialogues and foreign relations.  Use of economic strengths in relations to deal with the geo-political goals.  From an Indian point of view, its policies towards Israel and Palestine are shifting from mere symbolism towards one driven by substantial outcomes for its interests on a global level.  For example, India went against the US in a vote at the UN to recognize Jerusalem as the capital of Israel, with New Delhi backing its decision by highlighting that its views on the issue are independent and do not coincide with anyone else.  On the other side of the spectrum, it also pulled up Ramallah when the Palestinian ambassador to Pakistan was photographed sharing the stage with terrorist Hafi z Saeed, forcing Ramallah to recall their diplomat.  The fact that India is an upcoming superpower both by domestic and international narratives is a discourse that is directly on a collision course with its policy of non-alignment.  While West Asia is an example of India successfully balancing its interests over time, an emboldened Indian presence will also disallow New Delhi to fence-sit on issues of global relevance beyond a certain point.

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 Signs of such friction are visible with regard to Palestine, as India’s narrative on terrorism on global platforms today aligns much more closely with Israel. The political history of the Palestine Liberation Organization (PLO), Hamas and its military wing the al-Qassam Brigades today would stand at uncomfortable odds with India’s global stance against the idea of distinguishing between good terrorism and bad terrorism, specifi cally when the leader of Hamas, Ismail Haniya, has now made it to the US blacklist of global terrorists.  Policy of de-hyphenation of Israel-Palestine is straightforward and politically shrewd. Rather than treating the two entities as one complicated unit, India has chosen to pursue separate relationships with each party. This allows India to maintain the image of its historical moral support for Palestinian self-determination, and at the same time to engage in military, economic, and other strategic relations with Israel. India’s stand on Israel-Palestine Confl ict  India believes in the 2-state solution.  India supports the establishment of state of Palestine.  Indian government has diluted its reaction to Israel’s treatment of the Palestinians.  In 2014, India favoured a UN resolution to establish a Commission of Inquiry to investigate a violation of international humanitarian and human rights law. But our Government was reluctant to pass a resolution in Parliament condemning the Israeli action deviating from its earlier practice.  In 2015, India abstained at the UN Human Rights Commission (UNHRC) on a resolution welcoming the report of the same Commission of Inquiry. It was the fi rst time India refused to vote against Israel. However, with an increased focus on closer ties with Israel, there is little doubt that India has diluted its support to Palestine. Critical Analysis  India’s policy of de-hyphenation benefi ts Israel and severely undermines political and grassroots efforts to hold Israel accountable for its crimes against Palestinians.  Relations between the two cannot be viewed as “mutually independent and exclusive”, when one maintains total military and economic domination over the other.  December 2017, India voted in favour of a UN General Assembly resolution that declared United States President Donald Trump’s recognition of Jerusalem as Israel’s capital to be null and void. All of this support is surely valued by Palestinians, but unfortunately, Indian and international solidarity has made no tangible impact on Palestinian self-determination.  This is why India’s recent UN vote against Israel on the issue of Jerusalem did nothing to impact India-Israel relations.  Israel will only be held accountable and adjust its dreadful treatment of Palestinians when major powers, such as India, along with the rest of the world, impose a complete diplomatic, economic, and cultural boycott. Way Forward  Israel-Palestine relations are not just a serious issue but a very complicated issue. India has always talked about peaceful solution. India believes in a two-state solution in which both Israel and a future Palestinian state co-exist peacefully.  In West Asia, the political and strategic scenario is changing very quickly. India wants to de- hyphenate its relationship with Israel and Palestine andsee them as mutually independent and exclusive. These are two standalone relationships and they should not be hyphenated together.  India should maintain the image of its historical moral support for Palestinian self-determination, and at the same time to engage in military, economic, and other strategic relations with Israel.

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 CONCLUSION  India has been very keen to preserve a pragmatic balancing act between regional players in the West Asian region like Saudi Arabia and Iran. On similar lines, India should be cautious enough while backing Israel and should adopt a more balanced and pragmatic approach while dealing with Israel and Palestine.

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