Where India and China differ in the Indian Ocean region
The national security adviser-level trilateral between India, Sri Lanka and Maldives was held in Colombo last week, after a gap of six years, underlining the renewed urgency for cooperation in the region, particularly in the wake of China’s ambitious geopolitical tactics.
In the wake of the trilateral, it is important to examine ways to deepen co-operation between India and its Indian Ocean neighbours. One way to do this is strengthening India’s policy of development cooperation and economic diplomacy in the region vis-à-vis China’s engagement track.
India’s development cooperation has been a consolidated effort over several decades, across four key verticals. One, housing and rehabilitation projects and high impact community development projects have involved grassroots development and large-scale local participation.
Two, education-based tourism programmes and skill-building initiatives such as the Indian Technical and Economic Cooperation (ITEC) and the Technology Adoption Project were fully sponsored by the government of India, in coordination with over 68 premier institutions. Three, infrastructure projects have followed the Security and Growth for All in the Region (SAGAR) policy and aimed to deepen economic and security cooperation with its maritime neighbours. Some key Indian projects in Sri Lanka are the Kankesanthurai harbour in Northern Sri Lanka and the Indo-Japanese East Container Terminal (ECT) at Colombo Port. Similarly, for Maldives, India is assisting with the Greater Male Connectivity Project. And, finally, India is also committed to improving energy infrastructure and helping cope with the climate crisis in the region, aided by its expertise in solar energy.
India’s investments have thus been focused on human capital development and deployed largely in employment-intensive sectors. This is in contrast to Beijing’s efforts. China had developed particularly close ties with past regimes in Sri Lanka and Maldives. During the earlier presidency of Mahinda Rajapaksa and Maithripala Sirisena, Sri Lanka had committed to its participation in the Belt and Road Initiative. It was then that China became the largest investor in Sri Lanka and one of its projects, the deep-sea Hambantota Port, was leased to it for 99 years due to staggering debt. Similarly, in Maldives, President Abdullah Yameen’s tenure in office (2013-2018) was regarded as a time of a pro-China tilt for the Maldives. And it was then that large investments in infrastructure were made.
Since most of the Chinese investment has been in infrastructure projects, which have long gestation periods, and the majority of the development assistance is in the form of non-concessional loans, Sri Lanka and Maldives find themselves in a debt trap. The Maldives, for instance, has run up a debt of $1.3 billion to China, which is more than a quarter of the GDP of Maldives. The unsustainable levels of debt have made the new governments in both countries wary of foreign participation in large-scale infrastructure projects.
However, India can look to increase its engagement in a threefold manner. First, New Delhi can play a much bigger role through climate diplomacy with Maldives and Sri Lanka, since it has taken the lead in promoting two initiatives globally: The International Solar Alliance and Coalition for Disaster Resilient Infrastructure (CDRI).
Second, India could take a leaf out of China’s “sharp power” diplomacy and utilise its information broadcasting capacity to showcase its own global initiatives. This would help soften its “big brother” image in the region.
And finally, a key grouping that can play a bigger role in strengthening cooperation with Sri Lanka and Maldives vis-à-vis China is the Quad. Key individual actors — namely Japan, India and United States (US) — are present in both the countries as independent donor nations and can do much more through coordinated actions, to promote soft power and economic diplomacy.
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