India and Japan have joined hands in engaging in economic diplomacy with Africa and the rest of Asia — with the goal of social and economic development of the developing countries in these two continents. They formalized their commitment to this agenda during the recent annual meeting of the Africa Development Bank (AfDB) held in Gujarat in May 2017, where both the countries in the presence of their African Partners named their joint initiative as the Asia-Africa Growth Corridor (AAGC).
The vision document of the AAGC clearly lays down the four factors on which the whole initiative is based: development and cooperation projects; quality infrastructure and institutional connectivity; enhancing capacities and skills, and people-to-people partnership — all four of which have been finalized by bringing together different areas of expertise and varied experiences of both India and Japan in undertaking development projects in several developing countries of the Global South, including countries in Africa.
While it is a project that is still in its nascent stage, it has brought to the fore the changing dynamics of the India-Japan partnership as well as their converging interests in the African continent. Even while this initiative would cover most of Asia-Pacific, the thrust is certainly on Africa, which has become a foreign policy priority for both countries. While both India and Japan continue to engage with Africa separately, this is the first time that they have pondered on the possibilities of economic collaboration. The most important platforms for India and Japan to engage with Africa have been the India-Africa Forum Summit (IAF) and Tokyo International Conference on Africa Development (TICAD) respectively.
It was only in 2010 that both the countries initiated the India-Japan Dialogue on Africa which was the first step towards jointly strengthening their partnership with Africa. In 2015, both countries decided to go ahead with their proposed partnership. That same year, they came up with the “India and Japan Vision 2025” which was later reviewed and finalized as the AAGC initiative through the joint declaration issued by both countries in November 2016 during the visit of Indian Prime Minister Narenda Modi to Japan.
India-Japan bilateral cooperation began in the early 1950s after which India also began receiving a substantial amount of foreign aid from Japan. In 1986, Japan became India’s largest donor. Even though both countries enjoy a cordial political and economic relationship, their stature in the international development architecture has been rather disparate. While Japan is a developed country that belongs to the Global North and is a member of the traditional donor’s club of the Organization for Economic Cooperation and Development’s (OECD) Development Assistance Committee (DAC), India prefers sticking to its Southern identity and considers itself as a development cooperation provider of the Global South. India’s development cooperation has been based on the principles and framework of South-South Cooperation (SSC) that is not in alignment with OECD guidelines which Japan follows. While India has grown in stature today, with its own aid programs, it continues to receive assistance from Japan. Naturally, theirs is a North-South development partnership.
However, India and Japan have decided to step up their relationship into a strategic partnership by working on their commonalities and strengths that would help them fulfill their interests in Africa. This, therefore, becomes a case of South-North-South Partnership in development where diverse perspectives on development and economics will converge. Both India and Japan have struck several common grounds in reaching their decision to go ahead with this initiative. Interestingly, through the AAGC, both India and Japan would bring to the table a blend of two diverse perspectives of development: first, India’s experience as both a recipient of OECD aid as well as a development assistance provider to the countries of the Global South; and second, Japan’s experience as an OECD-DAC donor country giving aid and assistance to developing countries.
A comprehensive plan and approach to the AAGC are expected to be ready only by 2018.
Undeniably, several factors have played out in reaching the decision of initiating the AAGC. The most important questions would be: why are India and Japan now heading for such a partnership, and what do they expect to gain out of this? One important factor driving both India and Japan is their continuous lookout for natural resources and energy. Both are energy-starved countries, and Africa is their one-stop destination that could provide them with the resources, trade, markets, and energy security. Second, both countries are pushing their private interests in Africa and their businesses have been putting pressure on their respective governments for greater engagement with Africa. Therefore, economic diplomacy has a significant role in pushing for greater ties with Africa. Third, both India and Japan are eyeing permanent seats in a reformed United Nations Security Council (UNSC), and they aim to garner diplomatic support from their African counterparts. Fourth, with the changing power dynamics in the world affairs, both countries have started cozying up with each other so as to also counter China. India can feel the threat China poses in its immediate and extended neighborhood and is cautious of China’s advances. Japan is also trying to play a greater role in its region as well as in international politics which is now shifting in China’s favor.
While the AAGC might not directly challenge China’s Belt and Road Initiative, this is definitely going to give the African countries alternative options for funding their infrastructure and capacity-building projects, thereby giving no country the monopoly. Without doubt, China’s deep pockets and aggressive approach gives it an edge over others. Fortunately, the increasing number of actors with economic muscle would give more voice and choice to the African countries as well. Strategically using donors could bring greater dividends for Africa that has been traditionally on the receiving end of exploitation and power plays.
With India and Japan asking for a larger role in Africa, it is not just African countries that have implications for this increased engagement. The colonial powers that have got a foothold in Africa for centuries might slowly lose it in the coming years, and this idea is going to create at least some sense of insecurity in them. Also, with the reduction in aid by most of the developed countries, these new forms of assistance are going to bring in a new turn in Africa’s engagement with external forces on the continent.
Undoubtedly, Africa needs support from its partners in achieving the Sustainable Development Goals, in taking forward Agenda 2063, and constructing much-needed high-quality infrastructure and connectivity. Considering the varied nature of its countries and the diverse needs existing within and amongst them, several confusions and dilemmas, as well as conflicts of interest among the parties, may arise.
While a comprehensive plan and approach to the AAGC are expected to be ready only by 2018, it would be interesting to note as to how this initiative pans out. The success of the AAGC would depend on good and stable institutions; clearly laying-out the financing and the instruments of financing, that is, whether there will be grants, loans or commercial credit; clarity on interest rates and whether these would be tied to goods and services from India and Japan; creating country-specific projects that are both demand- and needs-based; and also setting up proper implementation and evaluation mechanisms.
Although several successful models of cooperation exist, making the AAGC a success would require huge investments in terms of aligning resources, proper implementation mechanisms, and most importantly, setting the right priorities. Indeed, India and Japan are in the process of building a new model of triangular cooperation with Africa that would present great prospects as well as myriad challenges.