The last three years were full of turbulence and turmoil. The COVID-19 pandemic controlled our lives in one way or the other. Millions of lives were lost, livelihoods were disrupted, and societies and economies were distressed. Now, we are moving ahead in the phase of post-pandemic recovery and revival. But the road to recovery is not uniform.  The developed countries have largely returned to pre-pandemic growth paths. However, the developing countries are struggling hard to catch up with the pace of recovery. However, the crisis has also provided us with a window of opportunity to reset our priorities and rebuild better. There is an opportunity to build a sustainable and resilient future.

The third-largest body of water in the world, the Indian Ocean is a vast geographical space.  It is not only rich in diverse marine resources but is also the route to one-third of the global trade.  It is therefore significant in strategic, economic, and ecological terms.

As the ‘natural superhighway’ of trade routes, the Indian Ocean is also a gateway to the international market for a landlocked country like Nepal. Therefore, our aspirations of prosperity are contingent upon peace and stability in the region. Yet, marine terrorism, climate change, human trafficking and trafficking of weapons and drugs threaten peace and security.

We cannot have a prosperous and resilient future in the absence of peace. No one country can safeguard peace and security alone. We need to work together on the principles of mutual respect, justice, and equality of all nations. This is critical because the Ocean is not just about the abundance of marine resources, list of trade routes, and graph of economic growth. It is also about our cultures and connections. It is also about our lives and livelihoods.

When we talk about the link and ecological interdependence, we must also consider the ‘organic link’ between mountains- the water towers- and the Ocean- the water reservoir. When we talk about protecting marine ecosystems, we must consider the health and wellbeing of mountains. This is key to realizing the prospects of ‘blue economy’ while preserving and conserving mountain economy. Sadly, the climate crisis has upset this natural link. The melting of mountain glaciers and sea-level rise have endangered lives and livelihoods both in the coastal and hinterland states. Both mountainous and low-land countries have been bearing the brunt of climate change. International commitments and promises abound, Commitment to halt warming at 1.5 degrees, to establish a fund of $100 billion, to double adaptation finance, to accelerate the green energy solutions, to establish a loss and damage fund as recently committed at Sharm El-Sheikh — and the list goes on! But, actions on the ground do not match these promises. Therefore, we need bold climate action. We need to work faster and go further.

On Nepal’s part, we plan to reach net-zero emission scenario by 2045. We remain committed to this goal. Given our hydropower potential, we stand ready to contribute to the clean energy solutions in South Asia. Our aspiration to a resilient, peaceful, and prosperous Indian Ocean region must go beyond economic and strategic considerations. This means ensuring smart and sustainable use of marine resources, ensuring the rights of all to explore, navigate, and utilize these resources, and ensuring transformative actions to restore the Ocean’s health. We must rescue it from pollution, plastics, and chemicals.

Nepal believes that connectivity is the key to regional integration. Our vision of a prosperous and resilient future cannot be materialized without enhanced connectivity through land, air, and water. We must connect our mountains with oceans. We must connect our products with markets. The international community must provide support to help the land-locked developing countries overcome their geographical constraints.

All this warrants that we better frame the future of collaborative partnership, with our peoples, our countries, and our region at the core. Our partnership must be anchored around the ideals of international law, inclusiveness, and cooperation. Nepal remains committed to engaging constructively in this regard.

We cannot overemphasize the glory, magnificence, and importance of the Indian Ocean. Let us work together to ensure the real, robust, and responsible actions for a peaceful, prosperous, and resilient future of the region. Let us ensure that we pass a healthy Indian Ocean to our children and grandchildren.

Author Brief Bio: Hon. Narayan Prakash Saud is the Minister for Foreign Affairs, Government of Nepal.

Note: This article is based on the Text of the Speech delivered by Hon. Narayan Prakash Saud, Minister for Foreign Affairs, Government of Nepal, at the 6th Indian Ocean Conference 2023 in Dhaka on 13 May 2023.

In these turbulent times, when the world grapples with unprecedented challenges and non-traditional security threats, Indian Ocean region stands as a beacon of hope amidst the storm. Peace, prosperity and partnership for resilient future resonates very deeply with us, guiding our deliberations towards practical solutions that will shape the destiny of the region. Today we have a rare opportunity if you wish a clarion call to champion peace and stability in the Indian Ocean and beyond. We must confront the harsh realities of conflict and instability because they are the fertile breeding grounds that nurture nefarious activities and perpetuates a sense of insecurity.

We cannot afford to remain passive and to be passive spectators, as the consequences of instability spill over into our lives, tarnishing the fabric of our societies. Take for instance the insidious trafficking of narcotics that plagues the Indian Ocean. Just within a decade, our once pristine waters have transformed into this highway for trade in illicit goods, a conduit of destruction that ravages our nations and compromises our very foundations. Let me illuminate the gravity of this situation. In a small nation of Seychelles, a small island state with its modest population of 100000, we find ourselves shackled by the devastating grip of heroin addiction. Astonishingly, a staggering 10% of our population now bear the heavy burden of this affliction. The implications of such calamity extend far beyond the individual itself impacting the security, stability and the well-being of the entire region.

Our workforce, our economic prowess and the promise of prosperous future all hang in the balance. We cannot allow this scourge to continue. Seychelles went out with limited resources and has shown unwavering determination in the face of adversity. Through joint patrols with our regional partners, we have bolstered our maritime domain awareness. Fortifying our ability to counter these criminal activities, we have strived to strengthen the pillars of law enforcement and judicial cooperation. Yet my esteemed colleagues, let us be resolute in our understanding that these measures alone are simply not enough. We demand the united front, a symphony of coordinated efforts with information sharing as its harmonious refrain. Together as a region in unison with international partners and organizations and agencies, we must pre-empt and dismantle these nefarious drug trafficking networks. But let us not only focus solely on the perils of narcotics.

The challenge of combating illegal, unreported, and unregulated (IUU) fishing looms large over our heads, casting a shadow upon the sustainable management of our marine resources and the livelihoods of our coastal community. In this regard, Seychelles acknowledges the pivotal role played by existing regional and international frameworks and agreements on fisheries management, such as the Indian Ocean Tuna Commission, IOTC and the Port State Measures Agreement, the PSMA. We have embarked upon a national plan of action, bolstering our monitoring, control, and surveillance capabilities. We have engaged civil society and the private sector, recognizing the significance of their involvement in combating IUU fishing.

Furthermore, we have joined the Fisheries Transparency International, which is FITI, to uphold the principles of transparency and accountability. However, the need for further cooperation is indispensable. We must elevate our collective capacity and awareness in the realm of IUU, and we must also recognize that the success of our efforts to address the challenges facing our region requires a strong and unwavering commitment from all of us. Additionally, it is imperative that we acknowledge another critical issue that plagues our region and that is human trafficking. This heinous crime preys on the most vulnerable among us, robbing individuals of their dignity and humanity. It is an affront to our shared values and freedom of justice, and we cannot turn the blind eye to this existence.

The Indian Ocean Region, with its vast and porous borders is a prime target for human traffickers. Trafficking victims are often smuggled across borders, exploited for labour or sex, and subjected to unspeakable horrors. This is a challenge that must be addressed through collaborative efforts among all our nations. We need to strengthen our border control measures, improve law enforcement capabilities, and enhance cooperation among our countries to combat this issue effectively. My dear colleagues, to achieve our shared goals, we need to focus on building trust, enhancing dialogue, promoting cooperation among our countries. We must work towards a more integrated and connected region where trade and investment can flourish and where people can move freely, whether for business or for leisure. Let us continue to work together with the shared vision and purpose so that we can create a more stable, prosperous, peaceful Indian Ocean for ourselves and for future generations.

Author Brief Bio: Mr. Charles E. Fonseka is the Minister of the Interior, Government of Seychelles.

Note: This article is based on the Text of the Speech delivered by Mr. Charles E. Fonseka, Minister of the Interior, Government of Seychelles, at the 6th Indian Ocean Conference 2023 in Dhaka on 13 May 2023.

Bhutan recognises the infinite potential of the Indian Ocean region as well as the challenge that we face in securing peace and prosperity for our people. Bhutan as a landlocked country in the eastern Himalayas may seem far remote from the Indian Ocean. But we recognize the vital role this region plays in global affairs. The Indian Ocean is home to some of the world’s busiest shipping lanes and is critical to global trade and commerce. It is also home to a rich diversity of cultures and people, and it is a shared responsibility to ensure that this region remains peaceful and prosperous for generations to come.

As much as the Indian Ocean region is critical for global trade and commerce, it is also vulnerable to not just traditional challenges of security, but emerging threats of biohazard, cyber warfare, maritime piracy etc. These threats not only endanger our economic interests, but also the security and well-being of our people. We must work together to tackle these challenges, leveraging our collective strengths and resources to build a more secure and peaceful region based on the principles of rules-based order. As a proud member of the United Nations, Bhutan also actively contributes to peace building efforts around the world.

In terms of prosperity, the Indian Ocean region has immense potential to become the most economically prosperous region of the century. The region has the economies of scale, immense consumer market and the technical prowess which can propel the world into an era of global affluence based on the ethos of sustainable development. The region is home to 64% of the global population and 60% of the global GDP. It also accounts for around 40% of the world’s oil supply and 64% of oil trade. We must seize this opportunity to drive inclusive growth and create a brighter future for the people of this region.

The COVID-19 pandemic has shown us how susceptible and interdependent the world is. As we look to the future, we must recognize the challenges that lies ahead. Climate change, natural disasters and pandemics are just some of the threats that we face. We need to work together to build resilience and prepare for the future. In this regard, Bhutan has taken several steps to address these challenges, including our commitment to remain carbon neutral and our efforts to promote sustainable tourism.

It is of no surprise that the Indian Ocean region is no longer based on the arithmetic of contemporary power equations, but the natural construct based on the principles of inclusivity, camaraderie and multi-stakeholderism. We recognize that Bangladesh and India as responsible nations are committed towards ensuring the rise of a free, open, inclusive and rules based Indian Ocean region. We must continue to work together to promote dialogue, cooperation and understanding among all stakeholders, respecting each other’s sovereignty, territorial integrity and political independence. While the Indian Ocean region has immense potential for peace and prosperity, it can only be realized if we work together in partnership to overcome the challenges that we all collectively face. Bhutan remains fully committed to work with our neighbours to promote peace, prosperity, and partnership. Let us seize this opportunity to build a more secure, stable, and sustainable future for our region and the world at large.

Author Brief Bio: Dr. Tandi Dorji is the Minister of Foreign Affairs, Bhutan.

Note: This article is based on the Text of the Speech delivered by Dr. Tandi Dorji, Minister of Foreign Affairs, Bhutan, at the 6th Indian Ocean Conference 2023 in Dhaka on 13 May 2023.

The Sultanate of Oman is fortunate to be situated along historic maritime routes. Trade and cultural exchange therefore form the basis of Oman’s history. As a seafaring nation, Omanis have always engaged with neighbours far and near, and this has enabled us to support peace and prosperity through partnership.

In all our endeavours, we foster harmonious relations and collaborative multilateral efforts to ensure a resilient future for our neighbourhood: for our shared maritime domain. The Indian Ocean region holds immense strategic significance, serving as a vital link connecting the East with the West. Its waters not only facilitate global trade and commerce, but also act as a gateway for cultural exchange and intercontinental cooperation.

We embrace the concept of working collectively to preserve peace, enhance progress and fortify stability in our region. It is Oman’s view that peace can be best achieved by fostering an environment of mutual respect. We overcome differences through open communication and hence forge lasting partnerships.

Through our longstanding policy of quiet diplomacy, we sustain stable and balanced relations with all our neighbours. We do not risk sudden shifts in the political environment of the kind that can undermine business confidence. This is Oman’s mantra. Dialogue gives us the best chance of peace. Peace brings prosperity and stability. And this is in the interests of all.

In the realm of maritime security, a shared concern for all states of the Indian Ocean region, no navy has the strength and knowledge to secure the seas alone. We rely on high level collaboration: partners must respect the rule of law and together ensure that transit routes remain peaceful and secure for all. Oman is committed to such collaboration to enable trade and investment. This will drive growth and uplift the livelihoods of all the people of the Indian Ocean.

Oman’s Vision 2040 development plan, focusses on this and pays particular attention to port development. In our region, ports are forecast substantially to reduce transit times and costs, and lead to a massive overall increase in the volume of trade. This will benefit us all. The Indian Ocean region, with all its economic and resource diversity, is brimming with immense potential. This potential can be unlocked by fostering economic integration, promoting sustainable development, and facilitating innovation. And our ports support this. Through Oman’s three major ports and freezones, Salalah, Sohar, and Duqm, we are leveraging our strategic location to boost regional trade and connectivity. But our ports cannot be successful without regional and international collaboration.

Partnership is the bedrock upon which nations can flourish. Enhancing cooperation in maritime security, economic opportunities, and information sharing is essential to enabling the free flow of goods, services and ideas. This will ensure a peaceful, prosperous and resilient future. The world has seen some positive shifts recently, in terms of pragmatism, dialogue, and inclusion. By welcoming all parties to the international arena, we gain a greater understanding of what transpires in our region, and thereby guarantee a safer environment for all.

We are proud to be part of this network of dedicated and pragmatic states, and we look forward to strengthening our cooperation further with cohesiveness and transparency, for the benefit of the people of the Indian Ocean and the world.

Author Brief Bio: Mr. Sayyid Badr Albusaidi is the Foreign Minister of Oman.

Note: This article is based on the Text of the Speech delivered (Virtually) by Mr. Sayyid Badr Albusaidi, Foreign Minister of Oman, at the 6th Indian Ocean Conference 2023 in Dhaka on 13 May 2023.

The United States is committed to elevating its engagement in the Indian Ocean region (IOR). The future of the world will be determined in large part by what happens in the IOR. The Indian Ocean region is home to 2.7 billion people—more than a third of the world’s population—and with an average age of 30 years, that percentage will only grow.

It is difficult to overstate the economic significance of this region. The Indian Ocean accounts for one-fifth of the world’s ocean surface, and it connects people and economies around the globe. Its vast coastline includes some of the world’s most important shipping lanes—from the Strait of Hormuz to the Malacca Strait. Eighty percent of the world’s maritime oil shipments traverse Indian Ocean waters. Some of the planet’s most vital fisheries are here, and they play a critical role in employing people in the region and feeding people around the world.

So, it makes sense that all of us have an interest in a peaceful and prosperous future for the Indian Ocean region. As President Biden has said, the United States is “committed for the long haul, ready to champion our vision for a positive future for the region together with friends and partners.”

At the same time, IOR does face serious challenges. The climate crisis touches us all, but it has a disproportionate impact on Indian Ocean countries. For some, particularly island states, climate change represents an existential threat. Meanwhile, piracy, armed robbery at sea, and trafficking degrade maritime security. And illegal, unreported, and unregulated fishing threaten blue economies, which need to be sustainable for future generations to prosper.

All of these challenges require a concerted and collaborative approach—Among all of us, countries, multilateral bodies like IORA, civil society, and people. And the United States is committed to doing our part. That’s why USA has announced plans to provide $165 million for programs across the Indian Ocean region that address climate change adaptation and mitigation, including the transition to a clean energy future.

It’s also why we are seeking to provide $6 million, working with the U.S. Congress, for regional maritime security initiatives, partnering with Bangladesh, India, Maldives, and Sri Lanka. This funding will bolster interdiction and law enforcement capacity in the Indian Ocean’s South Asian sub-region. Partnership is critical to maritime security, and I want to acknowledge India’s leadership in this space, specifically in the fields of anti-piracy, EEZ monitoring, and disaster response.

Investment in sustainable blue economies is a force multiplier, spurring economic development and demonstrating how environmental protection and economic growth are mutually reinforcing. Through USAID, the United States invests more than $33 million in 15 countries each year to promote sustainable fisheries and conserve marine biodiversity. And in this region, we are working to identify development assistance, including to Bangladesh, focused on growing sustainable blue economies.

We are doing this because the promise of the Indian Ocean region is limitless. We are doing this because unlocking its full potential requires all of us to come together. In the coming months, we will continue to advance our shared vision so we can build a more peaceful, prosperous, and resilient Indian Ocean region together.

Author Brief Bio: Wendy R. Sherman is the Deputy Secretary of State, USA

Note: This article is based on the Text of the Speech delivered (Virtually) by Wendy R. Sherman, Deputy Secretary of State, USA, at the 6th Indian Ocean Conference 2023 in Dhaka on 13 May 2023.

Australia’s prosperity and security is intimately tied to the Indian Ocean. Indian Ocean shipping lanes are crucial to the energy security and economies of many countries around the world, including Australia and global trade depends on stability and security here, in particular, the security of crucial chokepoints that are so fundamental to an open, stable and prosperous region.

Looking beyond trade, the Indian Ocean is also one of the key points of confluence for global strategic competition today and in an age in which we rightly obsess about the health of our global environment, the Indian Ocean is an area where the impacts of global warming and other environmental challenges will be felt most.

As the home of unique First Nations cultures, Australia is intensely proud to be the inheritor of the oldest continuous cultures on Earth and we have also benefited immensely from migrant communities from all around the world, that have made and continue to make invaluable contributions to our nation, not least the diaspora communities of South Asia and the Indian Ocean rim.

Australia is part of the Indian Ocean Region – part of its economy, part of its environment, part of its culture, part of its people. So, we believe strongly in building the institutions of and engagement with our region, particularly in the northeast Indian Ocean.

Australia’s Foreign Minister, Penny Wong, has spoken a lot about this recently, about how we want to live in an Indo-Pacific that is peaceful and stable, one that is not characterised by conflict, but one whose character is marked by “rules and norms that underpin our security and prosperity”.

Australia wants the region to be open and inclusive, to be based on agreed rules, to support countries of all sizes choosing their own destiny and we want our region to be prosperous and connected.

To share a measure of just how important the Indian Ocean is to Australia economically – we share the region’s longest Indian Ocean coastline as well as its largest search and rescue zone. So, we are heavily invested in the future of the Indian Ocean Region. But we acknowledge that the Indo-Pacific faces significant challenges: shifting geopolitics; climate change; maintaining the health of the blue economy, the source of millions of jobs across fishing, tourism, mining and transport and a grinding economic recovery post-COVID.

An important part of our work has to be building stronger regional architecture, to support our ability to work together and to build the regional economy. Russia’s illegal invasion of Ukraine has had rippling economic impacts across the region. Apart from the terrible suffering of the Ukrainian people, Russia’s illegal war of aggression against Ukraine has been intensely disruptive to the global rules-based order, and has exacerbated global food supply insecurity. Food prices, energy and fertiliser costs have all spiralled up, impacting people across the Indian Ocean.

As the only Ministerial-level organisation spanning the Indian Ocean, we see IORA as an important forum to address regional challenges. Under Bangladesh’s strong leadership last November, I worked with counterparts in the IORA Ministerial Meeting to agree IORA’s Outlook of the Indo-Pacific. This document marks the first time this region, as a region, has established a common view of an Indo-Pacific built on the international rules-based order, adhering to the United Nations Convention on the Law of the Sea and the rights and obligations UNCLOS contains in relation to the establishment of maritime zones, the freedoms of navigation and overflight, and the protection and preservation of the marine environment.

Australia is a strong supporter of initiatives that address the impacts of climate change in our region, including the Australian-funded IORA Blue Carbon Hub, and India’s Indo-Pacific Oceans Initiative (IPOI).

No matter which side of the Indian Ocean we are on, we all want to live in a region that is peaceful, and predictable. Together, we can respond to issues because no single country can fix on its own. We are very confident that with greater cooperation and partnership, we can create a region that meets our aspirations for being open, inclusive and secure. We have also been working hard in recent years to build that notion of partnership across the Indo-Pacific through working with regional partners, such as India, France and Indonesia, to combat shared challenges, through forums like the Quad, which we see working alongside regional institutions, including the Pacific Islands Forum, ASEAN, and of course IORA, to strengthen our shared interests and build capacity to pursue them and also through Australia’s AUKUS defence capability collaboration with the United Kingdom and United States – one element of our approach to maintaining regional stability and security in a more challenging strategic environment.

These are challenging times in global history, but one in which we can also see the immense opportunity across the Indian Ocean and the Indo-Pacific more broadly. We recognise the urgency of the issues we face right across our region, not least climate change and the health of global oceans and turning inwards is not the answer. The answer is the very opposite. It is redoubling our efforts to work together, in an open, collaborative, sustainable way, through regional and global institutions and systems that promote cooperation, through a strong, supported multilateral rules-based system, through open and non-distorting markets, through science and evidence-based decision making, even as we work together to decarbonise our economies.

Author Brief Bio: The Hon Tim Watts MP is the Assistant Minister for Foreign Affairs, Government of Australia.

Note: This article is based on the Text of the Speech delivered by The Hon Tim Watts MP, Assistant Minister for Foreign Affairs, Government of Australia, at the 6th Indian Ocean Conference 2023 in Dhaka on 13 May 2023.

The Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation – BIMSTEC– consists of countries around the Bay of Bengal, which is an integral part of the Indian Ocean. Five of our Member States are from South Asia: Bangladesh, Bhutan, India, Nepal, and Sri Lanka; and two are from Southeast Asia: Myanmar, and Thailand. BIMSTEC is therefore often perceived as an organisation that forms a bridge between South and Southeast Asia.

Formed in 1997, BIMSTEC has gained new vigour with the adoption of its Charter last year – during the 5th BIMSTEC Summit held in Colombo.The Charter which confers legal personality on BIMSTEC – identifies among its purposes – the maintenance of peace and stability in the Bay of Bengal region – through close collaboration in combating international terrorism, transnational organized crime – as well as natural disasters, climate change, and communicable diseases.

The Charter, among others, also lists as BIMSTEC’s purposes: -The maintenance of close and beneficial cooperation with existing international and regional organizations with similar aims and purposes; -Creating an enabling environment for rapid economic development; accelerating economic growth and social progress; providing assistance to each other; and cooperating more effectively in joint efforts that are supportive of – and complementary to national development plans of the Member States – which result in tangible benefits to the people in raising their living standards.

To ensure that the Indian Ocean Region is peaceful, prosperous, and resilient, the countries in the region need to strengthen existing partnerships between themselves; with Indian Ocean Users; as well as others – both Organisations and States. BIMSTEC in this connection, can serve as an important and central tool for its Member States and like-minded partners – to work towards maintaining peace and achieving prosperity for a resilient Indian Ocean Region.

Making use of the BIMSTEC Charter provisions, that enable BIMSTEC to cooperate with international and regional organisations; admit States, regional organisations & international organisations as Observers; and also admit new Members – are important aspects in this regard.

The Bay of Bengal region that makes up BIMSTEC is a home to about 1.8 billion people. This is a substantial percentage of the population of the Indian Ocean Region which is considered to be around 2.7 billion. The combined GDP of the BIMSTEC countries is considered to be over 3.6 trillion US dollars. Considering the geographic location of the Member States that make up the Organisation, BIMSTEC can be considered central as an Indian Ocean Hub – in both security and economic terms; and for achieving sustainable development – consistent with the BIMSTEC Charter.

Evolving BIMSTEC to play such a central role requires commitment, creativity, innovation, sustained political will, openness, and vision among the BIMSTEC Member States. It also requires consistent hard work to forge ties – with like-minded partner nations and organisations – across the Indian Ocean Region & beyond.

We all are committed to a shared vision of an Indian Ocean – built on peace, security, stability & prosperity. As a state-led and government-driven Organisation, the BIMSTEC Member States – set the Agenda for BIMSTEC. And we hope that the BIMSTEC Member States will ensure that BIMSTEC evolves and grows in a manner in which it can play a central role in achieving this shared vision.

Author Brief Bio: Mr. Tenzin Lekphell is the Secretary-General of BIMSTEC.

Note: This article is based on the Text of the Speech delivered by Mr. Tenzin Lekphell, Secretary-General of BIMSTEC, at the 6th Indian Ocean Conference 2023 in Dhaka on 13 May 2023

The Member States of SAARC are stakeholder countries of the Indian Ocean Rim. It is more so given that four Member States of SAARC are in the category of the Least Developed Countries, three of which are in the process of graduation. Peace, progress, and prosperity remain the key components of sustainable socio-economic development in today’s interconnected and interdependent global order. Cooperation, collaboration, and partnership at national, regional and international levels strongly contribute towards addressing the traditional and non-traditional problems and challenges, being faced by humanity around the globe, and thereby contributing towards enhancing peace, stability, and development, and establishing a prosperous, sustainable and resilient future for all.

The Indian Ocean region possesses a compelling degree of convergence of interests for the countries in the region and beyond. Endowed with abundant natural resources and being a centre for hydrological cycle, the Indian Ocean offers enormous opportunities for development. There is a closer link in terms of ecological and weather patterns of the Indian Ocean and mountainous regions, especially the Hindukush Himalayan range. The region also assumes special significance as the countries share historic civilizational and cultural linkages.

As one of the busiest trade routes in the world, the Indian Ocean provides important sea lanes that serve as arteries of the international economy. Having routes for more than three fourth of the world’s sea-borne oil and one third of global trade, the Indian Ocean assumes considerable significance in the global economy. Even for the land-locked countries in this region, which are members of SAARC, the Indian Ocean is a lifeline for their external trade.

Attaining peace and prosperity in the Indian Ocean region, through partnership, is, therefore, crucially important and conducive to promoting peace and prosperity in other sub-regions and the globe at large. Likewise, preserving the ecological balance in every geographical region, including the high Himalayas, low-lying lands, and the ocean would be a key for sustainable development by addressing the adverse effects of climate change and environmental challenges.

SAARC represents the manifestation of the determination of its Member States to promote peace, stability, amity, and progress in the region. It is based on the premise that the objectives of peace, freedom, social justice, and economic prosperity are best achieved in South Asia by fostering mutual understanding, good neighbourly relations, and meaningful cooperation among the Member States.

The Eighteenth SAARC Summit expressed firm determination to deepen regional integration for peace, stability and prosperity in South Asia. The SAARC Leaders acknowledged that the Member States, particularly the Least Developed and Landlocked ones, face structural constraints and challenges that result in their weak productive capacity, affecting their competitiveness in external trade due to, among others, high trade and transit cost. SAARC fully recognizes the common challenges, interests, and aspirations of the peoples of South Asia and beyond. It also recognizes that regional cooperation among the countries is mutually beneficial, desirable and necessary not only for attaining national and collective self-reliance, but also for promoting the welfare of its peoples and improving their quality of life.

The outbreak of the COVID-19 pandemic, followed by the public health crisis, has complicated the developmental scenario and reversed the hard-earned development gains of the past several years. The COVID-19 pandemic created economic and social instability and the biggest sufferers were LDCs. They suffered severely on the economic front, witnessing many job losses and a sharp rise in new poor and poverty, and are most vulnerable to Climate Change. The graduation also poses serious challenges to them on their path to economic prosperity.

We need to devise innovative and transformative means towards the implementation of the 2030 Development Agenda, including, among others, through evolving new partnerships and mechanisms; facilitating technology transfer, capacity building, information access, and monitoring and reporting for accountability.

It is imperative that we pay due attention to the threats posed by climate change and degrading environment and work in tandem to ensure responsible growth and sustainable development, while living in harmony with Nature. The time is now ripe for all of us to focus on attaining sustainable peace and prosperity across the region through strengthened partnerships.

Any initiative meant for attaining a more secure, open, inclusive, and prosperous Indian Ocean region would greatly contribute towards fostering peace, stability, and development in the region and beyond. In essence, the Indian Ocean should prevail as an ocean of prosperity and not an ocean of conflict.

Author Brief Bio: Mr. Esala Ruwan Weerakoon is the Secretary General of SAARC.

Note: This article is based on the Text of the Speech delivered by Mr. Esala Ruwan Weerakoon, Secretary General, SAARC, at the 6th Indian Ocean Conference 2023 in Dhaka on 13 May 2023.

Introduction

The Indian Ocean Region (IOR) is home to a diverse population with unique socio-economic and physical characteristics. This region is particularly vulnerable to climate change, and addressing its multi-dimensional impacts across the pillars of peace and prosperity is imperative. Recently, the region experienced natural calamities such as Cyclone Idai and Cyclone Kenneth that struck Mozambique, Malawi, and Zimbabwe, resulting in the loss of over 1,000 lives, widespread infrastructure damage, and crop destruction. Similarly, India suffered from one of the worst heatwaves in its history in 20XX, resulting in several hundred deaths and significant damage to crops and the agricultural economy. Small Island Developing States (SIDS) such as the Maldives, Seychelles, and Mauritius are particularly vulnerable to climate change because of their low-lying coastal areas and heavy reliance on climate-sensitive sectors like tourism and fishing.

There is an urgent need for investments in climate-resilient infrastructure and sustainable land-use initiatives facilitated through multi-sector collaborations to build resilience. Additionally, there is a need to think more holistically about economy-wide climate transitions in the face of increasing transitional risks. For instance, global responses to climate change commitments on trade and commerce on a global level, such as Carbon Border Adjustment Mechanism introduced by the EU in December 2022, are set to impact IOR economies such as India, Maldives, and Bangladesh, whose exports heavily rely on industries that highly carbon-dependent for their input processes.

A climate-ready financial sector is crucial to these efforts; the annual cost of adaptation will likely range between USD 140-300 bn by 2030¹. Investing in adaptation efforts that have mitigation co-benefits can help improve the efficacy of climate finance, most of which will be directed through the financial sector. As a crucial intermediary, the sector is well-placed to address the needs of various stakeholder groups vulnerable to the impacts of climate change to foster a collective transition to a climate-smart economy. Furthermore, governments of the IOR need to introduce climate-focused policies and regulations to enable this transition. They can also encourage innovation and climate-focused start-ups to support this transition, allowing the financial sector to invest in sustainable projects.

Impacts of Climate Change on the Indian Ocean Region

Climate change has accelerated in the region. The global mean temperature in 2022 was 1.15 degrees Celsius higher than the pre-industrial average, and the eight years from 2015-22 were the warmest ever recorded.² The Indian Ocean has warmed by ~ 1°C since pre-industrial times and is projected to continue warming resulting in coral bleaching, ocean acidification, and changes in marine ecosystems. This is accompanied by rising sea levels in the Indian Ocean (an average of 3.3 mm per year since 1950), an increase in the intensity and frequency of tropical cyclones (which could increase by 10 times in some IOR countries by 2100), and an increase in the risk of droughts and water scarcity, perturbated by changing monsoon patterns.

These pose significant challenges to the region’s economies and human well-being by damaging property and infrastructure, worsening food insecurity, increasing inequality and poverty, and reducing labour productivity. For instance, the rising sea levels could display up to 13 million people in the IOR by 2100 and could cause economic losses of up to USD 1.7 trillion.³ Under such circumstances, climate-stress-induced mass migration and conflicts arising from competition in accessing the dwindling natural resource base are projected to increase further.

These vulnerabilities are not evenly distributed but are differential based on geography and socioeconomic conditions. For instance, island nations and poor economies are more vulnerable due to a lack of effective means to mitigate the effects. These vulnerabilities are enhanced for indigenous communities in the IOR as their livelihoods and cultural practices are closely tied to the health of natural resources. Furthermore, across these groups, the social impacts of climate change disproportionately affect women and girls, who often have limited access to resources and agency to adapt to changing conditions. Hence, it is crucial to take a nuanced understanding of how climate change impacts differ across regions and populations to develop inclusive and equitable adaptation pathways.

IMPLICATIONS FOR PEACE

In regions where the dependence on natural ecosystems to meet livelihood needs is high, changing climate and weather extremes have implications for peace and security. Decreasing crop yields that threaten famine, or the anticipated loss of landmass in coastal areas, introduce competition in existing patterns of resource consumption across communities, economic sectors, and geopolitical boundaries, sometimes leading to violence and political instability. IPCC AR6 has asserted with high confidence that climate extremes increasingly drive displacement in all regions, with SIDS disproportionately affected.⁴ Climate change has generated and perpetuated existing vulnerabilities through displacement and involuntary migration. At progressive levels of warming, involuntary migration from regions with high exposure and low adaptive capacity is set to occur more frequently. In response, the Department of Political and Peacebuilding Affairs (DPPA) has made responding to climate-related security risks one of its strategic priorities for 2020-22, with this agenda gaining broader recognition in global narratives and diplomatic dialogues. Regional dialogues and country-level responses to the impacts of climate-induced resource competition and migration on national/regional peace and security need to build on collaborative governance and participatory sustainable resource management practices, emphasizing cross-collaborations across the regional actors and key sectoral players.

IMPLICATIONS FOR PROSPERITY

Economic growth rate and pattern are critical elements in raising prosperity levels and reducing societal inequalities, and climate change has a decisive bearing on both. The impact of climate change in the IOR is expected to have significant costs to the economy. A study by the Asian Development Bank suggests that the costs in South Asian countries will reach up to USD 215 billion per year by 2050.⁵ For some countries, this would result in a ~12% loss in their per capita GDP by the end of this century.⁶ Climate change also impacts human health, including increased incidence of heat stress, water-borne diseases, and vector-borne diseases such as dengue fever and malaria, in addition to food security. The effects of this are notably worse for the disadvantaged groups, whose needs are traditionally underserved and whose perspectives are often underrepresented in climate negotiation spaces. These groups get caught up in a vicious cycle of being increasingly affected by future climate extreme events. Their increasing inability to cope with the rising risks increases their exposure further (Figure 1). Lifting vulnerable communities out of this vicious cycle while meeting the countries’ climate commitments would require transformations in the economic sector, with coordinated efforts by stakeholders across the ecosystem. This would set us on the path of becoming a decarbonized economy that supports people’s financial well-being while promoting climate resilience.

Figure 1. Viscous cycle affecting the prosperity of vulnerable populations

Source: Adapted from Islam and Winkel, 2017. Climate Change and Social Inequality. Department of Economic and Social Affairs Working Paper No. 152.

Towards a decarbonized economy

Addressing the impacts of climate change on peace and prosperity would require a radical shift in how the economies of the region function. While meeting NDCs is a crucial first step in addressing its impacts (Table 1), a more significant shift at a systems level is needed to ensure that the economic sector is better equipped to deal with the physical and transitional risks that come with moving toward a decarbonized economy. Physical risks in this context refer to the direct impacts of climate change, such as natural disasters, extreme weather events, and sea-level rise in the IOR region. These can have immediate and direct effects on economic activities, including damage to infrastructure and property, disruptions to supply chains and markets, and increased insurance and financing costs for resilience. Transitional risks refer to the indirect impacts of climate change on the economy, such as policy changes, technological innovations, and shifting consumer behaviours and purchase patterns. These can have long-term implications for economic activities, including changes in market demand, regulatory policies, and investor preferences. Additionally, regulatory guidelines such as carbon pricing or trade regulations can have implications for industries’ competitiveness and profitability. Hence, this radical shift needs to be reflected in how the financial and broader economic sectors internalize climate change’s impacts across their value chains.

S.No	Country	NDC Target	Estimated CO2e reduction (million tonnes)	Additional Information
1	Australia	Reduce emissions by 26-28% below BAU by 2030	245-260	–
2	Bangladesh	Reduce emissions intensity by 5% from 2010 levels by 2030	90	–
3	Comoros	Reduce emissions by 29.4% below BAU by 2030	0.5	–
4	France	Reduce emissions by 40% below BAU by 2030	63	–
5	India	Reduce emissions intensity by 33-35% from 2005 levels by 2030	3,042	–
6	Indonesia	Reduce emissions by 29% below BAU by 2030	2,107	Includes conditional target of up to 41% emissions reduction with international assistance
7	Iran	Reduce emissions intensity by 4% from 2010 levels by 2030	109	Conditional target subject to international support
8	Kenya	Reduce emissions by 30% below BAU by 2030	138	–
9	Madagascar	Reduce emissions by 14% below BAU by 2030	3.3	–
10	Malaysia	Reduce emissions intensity of GDP by 45% from 2005 levels by 2030	297	–
11	Maldives	Reduce emissions by 10% below BAU by 2030	0.1	–
12	Mauritius	Reduce emissions by 30% below BAU by 2030	0.8	–
13	Mozambique	Reduce emissions by 30% below BAU by 2030	47	–
14	Oman	Reduce emissions intensity by 2% from 2016 levels by 2030	26	Conditional target subject to international support
15	Seychelles	Reduce emissions by 29% below BAU by 2030	0.1	–
16	Singapore	Reduce emissions by 36% below BAU by 2030	19	–
17	Somalia	Reduce emissions by 7% below BAU by 2030	1.1	Conditional target subject to international support
18	South Africa	Reduce emissions by 28% by 2030 and by 42% by 2025, relative to BAU	427	South Africa’s NDC includes both unconditional and conditional targets subject to international support
19	Sri Lanka	Reduce emissions by 4% below BAU by 2030	5.5	–
20	Tanzania	Reduce emissions by 10-20% below BAU by 2030	62	–
21	Thailand	Reduce emissions by 20-25% below BAU by 2030	308	–
22	United Arab Emirates	Reduce emissions intensity by 23.5% from 2016 levels by 2030	196	–

Table 1. Nationally Determined Contributions (NDCs) of IOR countries

MANAGING PHYSICAL RISKS: THE CASE FOR CLIMATE-RESILIENT DEVELOPMENT

Efforts to mitigate the physical risks that come with climate change need to double down on actions that focus on building the adaptive capacity of systems to respond to its impacts, including building resilient infrastructure, taking disaster risk-reduction measures, increasing sustainable practices across industrial supply chains, etc. This, among other societal benefits, would also result in reduced economic costs of recovery in the face of future extreme events. There is a growing recognition that climate financing in the global south needs to go beyond the energy sector’s green transition and catalyze funding for adaptation efforts with mitigation co-benefits. According to UNEP, the annual costs of adapting to climate change by 2030 might require thrice the quantum of existing funding levels, a significant share of which comes from the state. To address this gap, there is a need for scaling private sector participation through innovative, blended financing models. These models would ensure that various actual and perceived financial risks that come with climate adaptation finance are appropriately distributed among diverse economic actors based on their capabilities and appetite for risks. Increased funding levels in this regard should focus on land-use transitions that emphasize improving the services provided by natural capital while ensuring that the adaptive capacity of human-nature systems is enhanced in the process. There is an opportunity to build on the momentum enabled by global efforts to scale finance and action toward adaptation to focus on transitional changes at a systems level versus incremental steps that are uncoordinated and planned to increase short- and mid-term gains, often resulting in maladaptation.

MANAGING TRANSITIONAL RISKS: CLIMATE-SMART TRANSITIONING OF THE FINANCIAL SECTOR

In June 2019, the IMF endorsed investing in resilience building by disaster-prone nations, citing improved economic performance over the mid and long term. OECF estimates that the global investment requirements for addressing climate change will be to the tune of trillions of USD, with investments in resilient infrastructure alone requiring USD 6 trillion annually up until 2030. Most of these flows will be mediated through financial institutions. They are essential in complementing and potentially amplifying climate policy action by accelerating investments toward a low-carbon economy. Setting the right stage for the financial sector to play a crucial role in this capacity would require introducing mechanisms and processes to lower the transitional costs of becoming climate smart. While financial institutions already provide insurance and other risk-sharing instruments, they can play an even more fundamental role by supporting reforms across three key areas: governance, risk identification management, and disclosures of climate risks. Some leading central banks, such as the European Central Bank and the Bank of England, are already implementing these changes. For instance, the Bank of England was the first central bank to set supervisory expectations in 2021. In addition to setting up a climate financial risk forum, it has published risk management guidelines and conducted stress rest on its portfolio. In 2022, they published an online scenario analysis tool that any FI can use to evaluate its portfolio against climate risks.

While the central banks of countries in IOR are progressing in their thinking in enabling such a transition, implementation of the same remains nascent. For instance, the Reserve Bank of India, ranked 12^th among G20 central banks for green policies and initiatives, created a sustainable finance group in 2021 and announced its scenario analysis and disclosure framework in 2023. It is presently engaged in developing implementation mechanisms to underpin the transition. There is a need for channels of learning and collaborations across the IOR regions that can leverage existing efforts and best practices to advance action on this agenda, thereby improving the economies’ resilience to climate change. However, this transition as a stand-alone effort would not be effective if the rest of the economic sector is not ready to absorb the implications of these changes on their functioning. Preparing the financial sector for such a transition is particularly crucial for SIDS in IOR, whose major contributing industries stand to lose the most owing to their dependence on and vulnerability to changes in the natural capital.

ENABLING A SECTORAL SHIFT: MAKING ECONOMIES CLIMATE-COMPETITIVE

In December 2022, the European Union unveiled its Carbon Border Adjustment Mechanisms to advance its vision of achieving carbon neutrality in the European industrial sector by 2050. Several countries in the IOR, such as India, Maldives, Sri Lanka, and Bangladesh (refer to case study), rely heavily on carbon-based industries for their global trade and commerce. Not responding to these policy shifts would increase increased costs of international trade, thereby affecting their economies. Therefore, there is a need for industries contributing to major exports to explore ways of reducing their carbon footprint and becoming more climate-competitive in the global markets. Efforts to decarbonize the significant contributing sectors are an opportunity to make the economies climate-

competitive and meaningfully contribute to resilience-building in the region. These efforts must be coordinated through a systemic approach to address the various factors, namely, political and regulatory, economic, technological, and socio-cultural, that influence the sectors’ functions and responsibilities. Having a framework that could aid in evaluating countries’ readiness and evolving appropriate interventions across the four factors could help inform targets and pathways of change needed to make the economic sector climate-competitive (Figure 2). This needs to be underlined by solid cooperation and strategic partnerships across various stakeholders, both affecting and affected by the economic sector, nationally and regionally.

Figure 2. Framework to inform country-level climate competitiveness of the economic sector

Progressing Partnerships toward climate resilience in Indian Ocean Region

Climate change affects everyone, everywhere, all at once. Hence, the wide range of stakeholders involved in climate action must come together in negotiating for climate-resilient pathways for the future. Multi-sectoral cross-collaborations involving decision-makers and communities affected through highly participatory forums are needed to bring about an equitable and just transition toward an IOR that promotes peace and prosperity in the process of becoming climate smart. Collaborations across regions need to go beyond the conventional North-South partnerships to include more associations and collectives led by countries of the global south. This would mean inter-regional cooperation across the length and breadth of the ecosystem actors in IOR for financial support, technology development and transfer, infrastructure development, institutional building, and collaborative learning. The United Nations Office for South-South Cooperation (UNOSSC) recognizes the importance of Southern partnerships on climate change issues as valuable means of sharing their experiences and learning from each other based on mutual trust, collaboration, and understanding based on local contexts and consciously avoiding the traditional donor-recipient relationships.⁷ The existence of several partnerships in the IOR context, including the Indian Ocean Rim Association, Indian Ocean Commission, Partnerships for Resilience, and Indian Ocean Dialogue, needs to be leveraged to progress climate partnerships in the region. Ensuring that the recommendations from these partnerships accommodate the needs of downstream actors across the ecosystem is crucial to building just future pathways of impact. Apart from proactively facilitating and participating in these partnerships, the state has an important role to play in setting ambitious targets, providing policy support and guidance, introducing effective regulatory mechanisms, and encouraging innovation through accelerators and incubators that will set the stage for IOR’s transition into a cluster of decarbonized economies. This needs to be complemented by efforts of the private sector to catalyze more funding, advocate for increased uptake of sustainable practices across the economic sector’s value chains, and seed innovations in climate technologies.

INDIA’S APPROACH TO CLIMATE PARTNERSHIPS: INTERNATIONAL SOLAR ALLIANCE AND COALITION FOR DISASTER RESILIENT INFRASTRUCTURE

India has been instrumental in developing key partnerships to advance climate action on a global scale.

The International Solar Alliance (ISA) is an international organization launched by India and France during COP21 in 2015 with the primary objective of promoting the use of solar energy worldwide by driving market adoption for solar technologies in developing countries. At present, 110 countries are signatories to the ISA Framework Agreement. In 2020, it launched ISA Affordability Solar Project to provide 1000 MW of solar energy to the least developed and small island developing states by 2030. It has also established the ISA Innovation and Investment Cell to mobilize more than USD 1 trillion in solar investments by 2030. As the host country of ISA, India has committed to providing a grant of USD 27 million. It has established a dedicated ISA cell at the Ministry of External Affairs to coordinate India’s efforts.

The Coalition for Disaster Resilient Infrastructure (CDRI) is a global partnership of countries, organizations, and other stakeholders committed to promoting infrastructure resilience to climate change’s impacts. It was launched at the UN Climate Action Summit in 2019 to bring together knowledge, expertise, and financial resources to support the development of sustainable infrastructure worldwide. CDRI has launched a project on ‘Mainstreaming Disaster Resilience in Infrastructure Investments’ in partnership with the Global Infrastructure Basel (GIV) Foundation with the aim of developing a framework for integrating disaster risk management into infrastructure investments. Since its inception, it has collaborated with multilateral development banks, such as World Bank, the Asian Development Bank, and the European Investment Bank, to mobilize financial resources for disaster-resilience infrastructure in the CDRI member countries. India has committed to providing USD 10 million to CDRI’s corpus fund and has established a CDRI secretariat in New Delhi to coordinate its efforts.

These partnerships reflect the country’s commitment to promoting global climate action towards resilience-building and fostering international cooperation in addressing the impacts of climate change at scale.

Conclusions

The vulnerability of countries of IOR to climate change is multi-dimensional, and their impacts on their socio-economic security are inherently complex owing to their diversity. Its high reliance on natural ecosystem processes to meet its social and economic needs has crucial implications for the region’s peace and prosperity in the face of climate change. Climate action in IOR needs to prioritize climate adaptation efforts that have mitigation co-benefits while also focusing on building the capacity of social-economic systems to adapt to the anticipated changes.

The financial sector has a key role to play in this transition as most of the regional, national, and international climate finance needed to bridge the huge funding gap will be mediated through it. A climate-smart financial sector is hence crucial in amplifying climate action. It also has a direct implication for how natural capital is valued, managed, and governed. Making the financial sector climate-smart would require developing policies and regulatory policies that can effectively mitigate the physical and transitional risks that come with the transition. Further, the global shift towards becoming decarbonized economies has led to the introduction of several climate policies and regulations, such as EU’s Carbon Border Adjustment Mechanism. These instruments have a bearing on the economies of IOR countries that are highly reliant on carbon-intensive industries for their exports as they reduce their climate competitiveness. Hence the financial sector’s transition into becoming climate-smart must be complemented by efforts to decarbonize the economic sector overall, thereby contributing to climate-smart social-economic growth while making the economies climate-competitive.

As climate change affects all, multi-sectoral cross-collaborative partnerships across the region, among various stakeholder groups, in key areas, including financial support, technology transfer, climate-smart innovations, capacity building, and collaborative learning, are key to charting a common vision and shared pathways for a resilient future. With strategic partnerships, IOR economies can become climate-smart and support a prosperous, harmonious, and climate-resilient future.

Authors Brief Bio: Anirudh Kishore is Associate Consultant, Dalberg Advisors and Jagjeet Singh Sareen is Principal, Dalberg Advisors.

Note: This article was published by India Foundation in the Indian Ocean Conference 2023 Theme Paper Booklet.

References:

1. Asian Development Bank. “Assessing the Costs of Climate Change and Adaptation in South Asia”, Asian Development Bank, 2017.
2. Auffhammer, M. “The (Economic) Impacts of Climate Change: Some Implications for Asian Economies”. ADBI Working Paper 1051, 2019.
3. IPCC, 2022. Climate Change 2022: Impacts, Adaptation, and Vulnerability. Contribution of Working Group II to the Sixth Assessment Report of the Intergovernmental Panel on Climate Change.
4. United Nations Development Programme, 2021. Addressing the Climate Crisis in the Indian Ocean Region.
5. United Nations Environment Programme, 2021. Adaptation Gap Report 2020.
6. United Nations Office for South-South Cooperation, 2017. Climate Partnerships for a Sustainable Future Report: An overview of South-South cooperation on Climate Change in the context of sustainable development and efforts to eradicate poverty.
7. World Meteorological Organization, 2022. WMO Provisional State of the Global Climate.

The Indian Ocean is becoming a much more complex, congested and contested strategic space. This presents challenges (and sometimes also opportunities) for everyone in the region. In recent years we have seen some major powers try to build influence and even coerce Indian Ocean states through imperatives for economic development. Increasingly environmental security, and the narrative around climate change, will form part of the battleground for influence in the region. This paper proposes that Indian Ocean states should work together to develop regional structures and arrangements to facilitate them working together to improve resilience to environmental security and mitigate any attempts to take advantage of the vulnerabilities of regional states.

Key conclusions of this paper are:

• After several decades of US predominance, the Indian Ocean is now becoming a much more complex, congested and contested strategic space.
• At the same time, environmental challenges may represent an even greater set of security threats for the region.
• Environmental threats cannot be seen in isolation from other threats. These threats will interact with conventional geopolitical threats.
• There are currently no effective region-wide structures or groupings that are well adjusted to help regional states address these threats.

This paper will first discuss major power competition. Second, it will talk about the interaction of geo-environmental and geo-strategic challenges. Third, it will discuss the imperative for Indian Ocean countries to take an active role in addressing vulnerabilities through building regional responses to environmental threats, and what some of those collective responses could look like.

The Indian Ocean as a Contested Strategic Space

The United States has been the predominant power in the Indian Ocean for more than four decades and most likely will remain the strongest power for years to come, even as its relative lead diminishes. But there are many uncertainties about the future US role in the region.

The main US focus in the region has long been on the Persian Gulf. But there are important strategic changes occurring there. At the same time there is a significant reduction in the US dependence on energy sourced from the Persian Gulf which will only accelerate as the world transitions away from fossil fuels. This could fundamentally alter the shape of the US presence in this region.

The second major change in regional dynamics comes from the emergence of India as the largest economy and biggest military power among Indian Ocean states. India has long harboured ambitions to be recognised as the leading Indian Ocean power, with special security responsibilities in the region. India’s concerns about its position in the region is now very much focused on China meaning that strategic competition between India and China is likely to become a key factor in the dynamics of the region.

Another big change in the region comes from China’s growing presence. Beijing has important strategic interests in the Indian Ocean that are likely to drive an ever-greater military presence in coming years. It is widely understood that China’s most crucial interest is the protection of its trading routes over the Indian Ocean, over which a large majority of its imported oil needs are transported from the Middle East and Africa. But China also has other important strategic interests in the region, including a growing number of Chinese nationals and investments.

China’s flagship initiative in the region, the Belt and Road Initiative (BRI), involves building new pathways across the Indian Ocean region, both on land and at sea, may entrench China’s economic power in the region. The adverse financial consequences of the BRI for some Indian Ocean states are also becoming apparent. China has come under increasing criticism for engaging in so-called ‘debt trap’ diplomacy in some circumstances with some economically vulnerable countries. Pakistan is already seeing unsustainable indebtedness incurred in some projects. Sri Lanka has also experienced some of the consequences of entering into financially unfeasible BRI projects which in several ways contributed to its recent economic crisis.

Although there are many connections between strategic competition in the Pacific and Indian Oceans, the dynamics of the Indian Ocean are somewhat different. In the Pacific, the United States and China are the main strategic competitors, but the dynamics are somewhat different in the Indian Ocean, where competition is at its sharpest between India and China.   Regional states need to take this into account in trying to mitigate the potential impact of strategic competition.

Major Power Competition and Economic and Environmental Vulnerabilities of Indian Ocean states

Major power competition has the potential to significantly destabilise the region, as we see major powers increasingly jostling for influence among smaller countries.

Much of the focus over the last few years has been on economic development and economic competition. China has used the banner of the BRI to enter the region through a range of development projects.  Many of these may be intended to provide projects to benefit Chinese companies, but they have also been used to build economic and political influence among smaller countries.

A number of these projects have been economically unsustainable and debt burdens as well as competition for influence have been a significant contributor to economic and political instability in some Indian Ocean states. We saw that in Maldives in 2018 and Sri Lanka in 2022. In coming months, we will likely see indebtedness related to the China-Pakistan Economic Corridor initiative become a significant factor in the stability of Pakistan. We will likely see major economic disruptions there, including from an unsustainable debt burden, that will likely contribute to significant economic instability.

These developments provide important lessons to all Indian Ocean states about reducing their economic vulnerabilities. Australia has recently experienced a three-year campaign of economic coercion where a major economic partner sought to use trade as a weapon against it. The program of coercion was not successful, but it certainly taught Australia many lessons about the importance of reducing economic vulnerabilities.

Major power competition will not only occur in the economic sphere. There is a significant risk that some major powers will also seek to exploit vulnerabilities in the environmental space.

The Indo-Pacific and particularly the Indian Ocean is an epicentre of threats to our environment arising from climate change and other human activities – including severe weather events, sea level rise, failure of monsoon, salinification of ground water, oil spills, loss of fish stocks. These environmental challenges will increasingly make many Indian Ocean states more vulnerable to external shocks and external influence, including as part of geopolitical competition.

To be clear, competition among major power can potentially be used by Indian Ocean states to their benefit. To the extent that major powers have an interest in helping smaller countries build resilience and respond to climate change then this could be a good thing for us all. But there is also the potential for some major powers to try to take advantage of the vulnerabilities of smaller states, to their own benefit.

This means that the environment and environmental challenges could increasingly become a battleground for major power competition. We need to be addressing environmental challenges for their own sake, but we can’t also be blind to the potential strategic implications of how these challenges may cause regional states to become much more vulnerable to external influence and coercion.

The Interaction of Geo-environmental and Geo-strategic Challenges

There is often a tendency to look at environmental challenges as being separate and distinct from geostrategy and major power competition, but there are deep links that we need to be aware of.

In practice major environmental disruptions, particularly from climate change, have the potential to go far beyond what is normally understood as discrete environmental challenges. Climate change and other environmental impacts, particularly when combined with ethnic or other social problems, can contribute to increased migration, internal instability, or intra-state insurgencies, and may foster terrorism or even cross-border conflict. Climate-induced resource competition can also increase tensions within and between states.

In addition, environmental disruptions also often do not occur as isolated events, but instead can occur in combination or as a cascading or compounding series of events. One environmental disruption can contribute to or exacerbate the occurrence of another. One event might significantly reduce a country’s resilience or its ability to respond to subsequent, unrelated, events. This potential for magnification or cascading influences can make it difficult to predict the consequences of what may individually appear to be moderate or manageable threats.

There are several recent examples of how environmental disruptions have exacerbated strategic instability, sometimes in unexpected ways. One example is the contribution of illegal fishing off the coast of Somalia to the rise of Somali-based piracy and the build-up of naval forces off the Horn of Africa. Another example is the diverse and often unexpected security impacts of the 2004 Tsunami in countries such as Indonesia (where the disaster led to the end of civil conflict) and Sri Lanka (where the disaster rekindled a civil conflict).

These examples are reminders of how what might initially appear to be a single disruption to the natural environment could have significant, and widespread, strategic consequences for the region in often unexpected ways. This is why we should understand them as ‘geo-environmental’ challenges, on par with geopolitical challenges in terms of their potential to become a significant disruption to the strategic order.

Regional Responses to Environmental Security Challenges

So, what are Indian Ocean states to do about this era of growing geo-political and geo-environmental challenges? What can Indian Ocean states do to collectively mitigate these disruptions, as well as mitigating external attempts to take advantage of regional vulnerabilities?

Importantly, resilience not only has to be developed at a national level, but also through regional cooperation that provides coordinated responses and a regional voice about developments. Cooperation not only helps states be more resilient in the face of environmental threats but can also help provide resilience and stability in the face of major power competition. Regional solidarity can be an important way of reducing vulnerabilities of states to physical challenges and major power competition.

Some would argue that the Indian Ocean is currently poorly served in cooperative arrangements relating to environmental security that could facilitate cooperation among countries. There are certainly significant deficiencies in regional cooperation on environmental security. Groupings such as IORA or BIMSTEC have only begun to discuss these issues, and currently there is little or no meaningful regional coordination on policies and responses to climate change. There are no political declarations, regular meetings among environment ministers or senior officials, few regional response mechanisms, and no regional institutions for research or training in this area.

There are many things that Indian Ocean states can learn from other comparable regions. The Pacific Island countries, for example, have in many instances taken the lead in developing effective regional initiatives to address a wide range of environmental security challenges, whether it be in sustaining fish stocks and biodiversity, addressing the challenge of marine plastics or working together to build resilience to climate change. The experience of the Pacific and other comparable regions in the world could provide important lessons for what Indian Ocean states should be doing.

This could include the following regional initiatives, among many others:

• Regional declaration on environmental security: The 2018 Boe Declaration where Pacific Island Countries declared climate change to be their highest priority security threat.
• Indian Ocean Environmental Security Forum: Consideration should be given to establishing an Indian Ocean Environmental Security Forum.

An Indian Ocean forum would bring together representatives from military and civilian agencies and non-governmental organisation across the Indian Ocean region to create shared understandings on environmental security threats and help establish habits of dialogue in the field of environmental security and potentially coordinate strategic policy in this area.

• Disaster Risk Reduction: There is considerable scope for developing framework disaster management arrangements among key Indian Ocean states. Such an arrangement should focus on developing pre-existing coordination mechanisms for responding to disasters among the most capable states.

This could draw from the successful experiences of ASEAN and the FRANZ arrangements among Australia, France, and New Zealand in the South Pacific. Such arrangements do not necessarily need to depend on every country in the region. Rather, the starting point is the coordination of key states with capabilities to respond, working in cooperation with interested regional states.

Conclusion

The Indian Ocean region will face some major environmental challenges in coming years that may impact regional stability and make countries much more vulnerable to external factors. In thinking about responses to climate change and other environmental challenges we need to understand the potential connections between environmental issues and broader geo-strategic issues. The Indian Ocean region needs to work together to reduce vulnerability and build a regional voice on these issues. Other regions can sometimes give us useful lessons about what can be achieved.

Author’s Brief Bio: Dr. David Brewster is Senior Research Fellow, National Security College, Australian National University

Note: This article was published by India Foundation in the Indian Ocean Conference 2023 Theme Paper Booklet.

Introduction

The Indian Ocean Region (IOR) is often identified as a strategic region subject to increasing geopolitical contestation while serving as a potentially dynamic economic region. This paper will examine the prospects and challenges for increased co-operation within the IOR in the context of both these observations. It will specifically examine the ‘Blue Economy’ and how it impacts patterns of both competition and co-operation in the IOR.

This paper will make three main points. It will firstly examine the Blue Economy as a policy goal within broader public policy debates in the IOR. The second point is outlining traditional and non-traditional security threats in the IOR and how they possibly impact the pursuit of Blue Economy goals. The third point lies in identifying the overlap between geopolitical concerns and geo-economic imperatives in the IOR.

The Blue Economy in the IOR: Pursuing a Public Policy Goal  

The Blue Economy (sometimes also referred to as the ‘oceans economy’) concept originates from the United Nation Conference on Sustainable Development, held in Rio de Janeiro in 2012. Following on from this conference, in 2014, the United Nations published the Blue Economy Concept Paper, wherein it clearly defines the public policy goal ‘of the Blue Economy concept is the de-coupling of socioeconomic development from environmental degradation’. The World Bank, in 2017, viewed the Blue Economy as ‘the sustainable use of ocean resources for economic growth, improved livelihoods, and jobs while preserving the health of ocean ecosystem’. The Blue Economy, as a public policy goal, involves negotiating the tension between the opportunities the ocean economy provides and the threats such activities pose.

States in the IOR have consistently declared their intentions to achieve Blue Economy goals. The Jakarta Declaration on Blue Economy of 2017 committed the member states of the Indian Ocean Rim Association (IORA) to twenty-three principles in pursuit of Blue Economy goals in the IOR. These range from building stronger legal and regulatory regimes, developing more robust public-private partnerships as well as leveraging various sources of finance in pursuit of Blue Economy goals, including collaboration with partner states outside the IOR (some of which are Dialogue Partners of the IORA).

These Blue Economy goals have been fiercely debated by various groups in the IOR, comprising academics, economists, and conservationists, amongst others. The tension between conservation and growth is a key policy quandary for leaders in the IOR, specifically for Small Island Developing States (SIDs) as well as for local leaders in coastal communities in these states. For leaders in many IOR states, there is a strong political imperative to tolerate the long-term (and not easily discernible) effects of climate and environmental change in return for economic growth. This, of course, is a broader global public issue related to the principle of ‘Common but Differentiated Responsibilities and Respective Capabilities’, first established at the 1992 United Nations Conference on Environment and Development. The key issues to emerge from this tension are over-fishing, marine pollution and ocean governance and they relate to the nature of traditional and non-traditional security threats faced by states in the IOR.

Blue Economy in the IOR: Dealing with Traditional / Non-Traditional Security Concerns

The key difference between traditional and non-traditional security threats are the targets of the threat and the source of the threats. Direct military threats towards a state from another state is the most obvious example of a traditional security threat. Non-traditional security threats comprise of threats that don’t target specific states but are transnational in nature and don’t emerge completely or directly from a specific state. The effects of climate change, natural disasters, illegal, unreported and unregulated (IUU) fishing, and maritime pollution are just some examples of non-traditional security threats in the maritime domain. However, the distinction between the two types of threats is not always clear and there is some overlap in specific contexts. For many states, energy, food, and water security, consisting of the ability to access both renewable and non-renewable energy sources as well as food and water sources is increasingly a traditional security issue. In other cases, responses to non-traditional security threats becomes a site of inter-state competition and rivalry, driven by broader, pre-existing inter-state rivalries.

The IOR, for much of the Cold War, was not a key site of strategic competition, with Southeast Asia the main arena of strategic rivalry. In the early post-Cold War era, the broader East Asian region was the focus of strategic rivalry, with several maritime ‘hotspots’, especially the South China Sea, becoming sites of strategic rivalry between China, the US and countries within East Asia. The IOR, meanwhile began to garner increasing attention from the early 2000s, leading to Robert Kaplan’s much discussed 2009 commentary in Foreign Affairs, where he described the IOR as the ‘center-stage’ for ‘power plays’ between leading states in the twenty first century and his book in 2011 described the IOR as the key site for the US’s global strategic outlook. China’s ‘Westwards Strategy’, accompanied by its increasing economic and military presence in the IOR, has been a key driver for the growing interest in the IOR. The nature of China’s growing presence in the IOR, both militarily and economically, has increasingly shaped responses to non-traditional security threats in the IOR. China’s growing presence in the IOR is viewed as an obstacle in trying to achieve Blue Economy goals, specifically in dealing with non-traditional security threats in the IOR. This is because of the perception that China’s actions in the non-traditional sphere increases the potential traditional security threat it poses for some states in the region.

Illegal, unreported and unregulated (IUU) fishing is a major non-traditional security threat for littoral states of the IOR. Sustainable fishing is a crucial Blue Economy goal contained within both the Jakarta Declaration as well as the earlier Mauritian Declaration, acknowledging the threat that IUU fishing poses both for the livelihoods of coastal fishing communities as well as to ocean wildlife ecosystems. In the IOR, there are several littoral states with large expanses of both territorial seas and EEZs which they do not have the capacity to closely govern and monitor illegal fishing. In these situations, states require jointly setting up regimes and processes to govern and monitor their adjoining EEZs and territorial seas.  In certain cases, they may require assistance from outside the region or sub-region from international organisations, regional organisations or individual countries outside the region/sub-region. A good example of this model is the Extended Regional Coordination Unit (ERCU) of the Regional Fisheries Surveillance Plan, an initiative amongst eight countries in the South-West Indian Ocean (comprising Comoros, France/La Reunion, Kenya, Madagascar, Mauritius, Mozambique, Tanzania and Seychelles). With funding from the European Union, this set of countries have accomplished certain significant Blue Economy goals since 2007, specifically by reducing IUU fishing incidents by significantly improving the region’s monitoring and surveillance capacity.

However, in other sub-regions of the IOR, such mechanisms for states for joint monitoring and surveillance capacity are under-developed. Besides monitoring the contiguous EEZs and territorial seas of littoral states, there is also the issue of over-fishing and illegal fishing of protected and endangered species in the high seas or international waters. Within the specific context of pursuing Blue Economy goals, the over-lap between traditional and non-traditional security threats, is particularly apparent vis-à-vis such IUU activities. In the South China Sea, there is an increasing overlap between traditional threats, associated with maritime disputes and issues of sovereignty, and alleged intrusion by foreign fishing fleets in areas deemed to the EEZs and territorial seas of certain littoral states.  The case of the Philippines publicly claiming that Chinese fishing fleets acting as a de facto Chinese maritime militia in disputed areas of the South China Sea is a case in point. In such cases, states begin to define solutions to non-traditional security threats as zero-sum in nature, involving the use of military force and diplomatic pressure, rather than jointly crafting, and pursuing Blue Economy goals to resolve non-traditional security threats that affect various states.

In the IOR, there have been increasing overlaps in perceptions of non-traditional and traditional security threats, specifically in relation to IUU fishing in the high seas. Chinese flagged fishing vessels have reportedly been involved in unregulated fishing of squid within the high seas of the IOR, putting further strain on sustainable seafood stocks in the IOR. In addition, Chinese vessels have also reportedly been illegally catching tuna in parts of the IOR which already exhibit dangerous levels of over-fishing. These reported incidents of IUU fishing in the IOR by Chinese flagged fishing vessels are increasingly viewed as part of a wider range of traditional security threats emanating from China. There are two key reasons for these perceptions.

Firstly, there is a growing view that IUU fishing by Chinese flagged vessels in the IOR is part of a broader response by China to the notion of a global rules-based order. In this view, China perceives rules and norms governing the maritime domain as illegitimate and thus not binding on it. Several observers have drawn parallels between China’s maritime claims and actions in the South and East China Sea, which are viewed to be in contravention with China’s obligations under UNCLOS and Chinese flagged fishing vessels involved in IUU fishing in contravention of its obligations via-a-vis various statutes related to IUU fishing. This leads to a growing view that joint Blue Economy Goals would be difficult to pursue within the context of China’s approach towards its own obligations in relation to protecting marine ecosystems and seafood stocks within the IOR. As a result, a non-traditional security issue such as IUU fishing is increasingly viewed as part of the broader range of traditional threats which China poses to states within the IOR and beyond. Seemingly driven by increased domestic seafood demand within China, there is a perception that Chinese flagged vessels are trying to satisfy domestic demand to the detriment of littoral states in the IOR.

Secondly, certain littoral states in the IOR view the specific activities of Chinese fishing vessels with a great deal of suspicion. There are concerns that the crew on certain Chinese flagged fishing vessels comprise of People Liberation Army Navy (PLAN) personnel and these vessels are used for ocean reconnaissance for military intelligence purposes. These concerns again view Chinese flagged vessels as instruments of broader Chinese military goals in the IOR. In such a context, it is clear to see how and why IUU fishing increasingly ceases to be a non-traditional security issue and instead a clear national security threat to certain states in the IOR.

 Blue Economy Goals in the IOR: Geo-politics and Geo-Economics

Geo-politics is the impact of geography on the conduct of relations amongst states, while geo-economics as a concept has largely been used in relation to geo-politics. Geo-economics is the “use of economic instruments to promote and defend national interests, and to produce beneficial geopolitical results.” Proponents of geoeconomics often point to two benefits it enjoys over geopolitics as a strategy. Firstly, from the perspective of individual states, economic instruments lend themselves to greater flexibility and lower longer-term costs, both financial as well as social. Secondly, the use of economic instruments provides greater possibilities for ‘win-win’ outcomes for states, especially when such instruments lead to net economic growth and development of all states concerned. Geopolitics, in comparison, with the use of military options which leverage on specific geographical advantages, are less likely to result in ‘win-win’ outcomes amongst states, according to this view.  More broadly, as a driver of relations between states, geoeconomics creates greater possibilities for co-operation as compared to geo-politics driving relations between states.

In recent years, China has been perceived to increasingly use economic instruments to safeguard and advance its national interests. China is ready, in this view, to use the threat of superior military power as well as diplomatic pressure especially in the South China Sea, but in the IOR, economic instruments seem to be preferred over demonstrations of military power or diplomatic pressure. China is perceived to increasingly prefer geoeconomics over geopolitics as a means of furthering and advancing its interests. A key aspect of China’s geoeconomics strategy is its Belt and Road Initiative (BRI). In the IOR, the BRI has been linked to accomplishing Blue Economy Goals, specifically the sea-based Maritime Silk Road (MSR).

In 2017, China announced its blueprint ‘Vision for Maritime Cooperation under the Belt and Road Initiative’, with an emphasis on developing a Blue Economy with sustainable development a key element of this vision.  China envisions three global ‘blue economy passages’, and one of them is the China-Indian Ocean-Africa-Mediterranean Sea Blue Economic Passage.  In addition, China has also stated its commitment to assist littoral states in the IOR towards the economic development of its coastal communities and the wider national economy. In essence, this blueprint aims to fulfil the two key, sometimes competing, imperatives of the Blue economy – helping littoral states harness their maritime locations for economic development while ensuring environmental and sustainability concerns are addressed.

China’s building of commercial ports in the IOR as part of the MSR has been justified in terms of helping the economic development of states in the IOR in three ways. Firstly, certain coastal communities in IOR littoral states have not economically benefitted from their geographical location and building new ports away from earlier established and busy ports would benefit these communities. The case of Hambantota port was a case in point, where a new commercial port would help raise economic activity and development, which was earlier largely concentrated in Sri Lanka’s busiest port in Colombo, and thus benefit the communities in that area of Sri Lanka. Secondly, it would raise the overall economic development of that country, as it leverages the strategic geographical location of these countries to increase economic activity within the whole national economy. Thirdly, it would benefit other states as well, as new ports and the increased economic activity that stemmed from it would increase economic activity in the region and with it, development across the region. This ‘win-win’ logic also included economic gains for China as it seeks to utilise excess capital and human resources within China for such projects abroad.

The MSR was touted as an example of geoeconomics driving relations between states, with ‘win-win’ outcomes for all states involved, rather than the zero-sum outcomes often attributed to geopolitical drivers. In addition, China made commitments towards meeting the sustainable development benchmarks of the Blue Economy goals that were set as part of the MSR. However, there is a growing sense amongst certain states that China’s MSR aims to establish geopolitical control over littoral states in the IOR rather than helping their economic development. In addition, there have been an emerging view that China’s sustainable development commitments are largely lip-service and that its perceived record domestically on environmental protection and on IUU fishing in ‘distant waters’ are mirrored in its approach to MSR projects.

There is an emerging view that China’s MSR is driven as much by geopolitics as it is by geoeconomics and the perceived overlap between geopolitics and geoeconomics in China’s MSR has significantly hindered the accomplishment of Blue Economy Goals in the IOR.  The construction of new ports by China in the IOR is increasingly not economically viable (at least in the short to medium run) and the takeover of these economically distressed projects by China’s state-owned enterprises (SOEs) has raised concerns about China’s ability to translate such ownership into constraining the geopolitical choices of recipient states. This has led to countries such as India increasingly viewing port development projects not as part of larger Blue Economy development goals for communities within the IOR but instead as part of a wider geopolitical contest with China.

Author Brief Bio: Dr. Sinderpal Singh is Senior Fellow and Assistant Director, Institute of Defence and Strategic Studies.

Note: This article was published by India Foundation in the Indian Ocean Conference 2023 Theme Paper Booklet.

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“For thousands of years, Indians have turned to the East. ot just to see the Sun rise, but also to pray for its light to spread over the entire world. The humankind now looks to the Rising East, with the hope to see the promise that this 21st century beholds for the whole world, because the destiny of the world will be deeply influenced by the course of developments in the Indo-Pacific region.”

• Shri Narendra Modi, Prime Minister of India, at his Keynote Address, Shangrila Dialogue, Singapore, June 2018

The Indo-Pacific region is home to the most dynamic economies in the world. It holds promise to a world recovering from the devastations of the Covid pandemic, the debilitating impact of the continuing war in Europe and the looming threat of a global recession. The geopolitics of the region, however, remains complex and generates deep anxieties over China’s unprecedented rise and growing US-China rivalry. There is a deep mistrust of Chinese policies and motivations which is no longer prepared to “bide its time and hide its capabilities”. This threatens regional peace and stability and impedes the region from realising its full potential.

A rising China poses major challenges, even as it offers economic opportunities. China has used its economic heft, its political influence, and its military strength to rewrite the existing regional order with strong Chinese characteristics. It has used threat and use of force to subjugate the region. Its belligerence in handling territorial disputes with its neighbours, its militarisation of disputed islands in the South China Sea (SCS), its intense military exercises and aggressive posturing towards Taiwan, its territorial claims in the East Sea and on the India-China border, all are fraught with the grave risk of a military conflict. China has successfully divided Southeast Asia and enmeshed them into an endless cycle of meaningless negotiations on their territorial claims in SCS, while pursuing regional expansion.

Chinese enhancement of its defence systems, including its nuclear and missile capability, both in size and sophistication, have become a credible regional threat, including to a US that has prioritised its problems with Russia over impending threats from China. The positions articulated by the leaders of Germany and France on their recent visits to China weakens Western solidarity and is expected to further shrink strategic space in dealing with Chinese aggression. Chinese dam building activities in the Brahmaputra and Mekong rivers, with its adverse impact upon environment, water availability and agricultural production in the lower riparian countries is also of serious concern. It reflects Chinese indifference to any rules-based order in resolving trans-border issues.

Growing economic dependence of smaller countries upon China and increasing financial burden of Chinese debt weighs heavily upon those countries that allowed such unviable financing arrangements. The ambitious Belt Road Initiative (BRI) has had a deleterious effect on the local economy and environment of recipient countries in Asia, Africa, and Latin America, while serving Chinese interests. Notwithstanding all the recent rhetoric to “de-couple” from China, an over dependence upon the Chinese market, its finances and its supply and manufacturing chains prevents the rest of the world from reining in China’s errant behaviour, as it replaces the balance of power in its favour.

Whether China will be cooperative or allowed to become the overall dominant power will depend upon the countries in the region, especially those that enabled China’s rise in the first place and wilfully ceded space to a Chinese dominated order. Much will also depend upon how successfully other players in the region work together to create a multi-polar alternative to balance the power equations in the Indo-Pacific.

India is an important stakeholder for peace and prosperity in the Indo-Pacific region. India would also like to have good relations with China. China is one of India’s largest trading partners, and there is immense potential for working together in international fora on multilateral trading system, on climate change, on the international governance system to make it more equitable and fairer. However, China’s aggressive behaviour on the Indian border in the last one year has vitiated the atmosphere, with public opinion in India turning against China. China’s complete disregard of bilateral agreements and efforts to change facts on the ground on India’s border, have adversely impacted bilateral relationship. Chinese encirclement of the Indian periphery also undermines India’s security in the region. The China-Pakistan Economic Corridor, a BRI project in Pakistan Occupied Kashmir, completely disregards India’s sovereignty and territorial integrity. Its latest, renaming places in the Indian state of Arunachal Pradesh with Chinese names, is downright provocative.

For Asia to claim its rightful place as the continent of the future, no single power can dominate. Such hegemony is detrimental to regional peace and security. Along with USA, Japan, Australia, Russia, the countries of the Association of Southeast Asian Nations (ASEAN) and the European countries, all stakeholders in a peaceful and prosperous Indo-Pacific, India can play an important role in creating a viable, rules-based, multi-polar world order for a resilient future in the Indo-Pacific.

This year, India will host two major multilateral summits -the Shanghai Cooperation Organisation (SCO) in July and the G20 in September. India’s Presidency of both SCO and G20 offers immense opportunities for setting a positive agenda for peace and security.

The SCO membership contributes 30% of world GDP and 40% of population. Greater cooperation among SCO member countries can enhance regional security, counter the scourge of terrorism, and lead to balanced and equitable growth. The SCO as a forum can also share best practices on technological advancement, environment conservation and cooperation in optimum utilisation of resources. Other areas of potential cooperation include reliable, diversified, and resilient supply chains for growth and development.

Similarly, the G20 represents 85% of global GDP, 75% of international trade, and 2/3rd of the world’s population. Its membership consists of the most influential countries in the world. In a world fragmented by polarising conflicts and decline of global institutions, the G20 can play an important role in finding solutions to these issues.

Under its Presidency of G20, India will try to build consensus on foremost issues for global growth. As pointed out by Shri Narendra Modi, the Indian Prime Minister, India will focus on issues that unite instead of those that divide, to find “the right balance between growth and efficiency on the one hand and resilience on the other”. India’s agenda will be inclusive, ambitious, action-oriented, decisive, and aimed to promote the spirit of “oneness”, inspired by the traditional Indian theme of “Vasudhaiva Kutumbakam” or “One Earth, One Family, One Future”. This is important in the face of evolving global challenges, including the geopolitical crisis, food and energy insecurity, slow progress on Sustainable Development Goals (SDGs), mounting debt burden and challenges to climate action and climate justice.

India will also provide a stronger voice to issues of concern to the Global South. These include reform of international institutions, including the United Nations, the multilateral banking system as well as restructuring of unsustainable loans. During the Voice of the South Summit held in January earlier this year, Prime Minister Modi pointed out that most of the challenges confronting the developing countries, including climate change, were not created by the South, and necessitated common but differentiated responsibilities in dealing with these problems. Moreover, for the countries of the South to prosper, it would be important to identify simple, scalable, and sustainable solutions that can transform societies and economies.

India’s recent growth story offers several positive lessons. These include India’s digital delivery, public health response to the Covid pandemic, green growth, clean energy, sustainable lifestyles and development as well as the empowerment of all sections of society, including women-led development. Some of these initiatives merit attention.

India recently launched the ‘LiFE’ initiative – Lifestyle For Environment, where the responsibility for sustainable development rests with every individual. The concept of Pro-Planet-People and the focus on individual behaviours is derived from India’s ethos of living close to nature.

India’s Millet initiative, which has resulted in the UN declaration of the year 2023 as International Year of Millets, has been lauded for addressing food security and in fulfilling the SDGs.

India has also taken the lead in the global sphere to spearhead the transition towards cleaner sources of energy. India’s global initiatives such as the One Sun One World One Grid and the International Solar Alliance have been complemented by its domestic commitment for achieving 50% installed electricity capacity through non-fossil sources.

India’s evolving experience in bridging the domestic digital divide provides useful lessons to the international community in bridging the global digital divide. The Unified Payment Interface (UPI), pioneered by India, is an example of how Indian solutions have the potential to come to the aid of the world. In 2021, over 40% of the world’s real-time payment transactions took place through UPI. The UPI transaction value has been more than $800 billion indicating a growth rate of 97% for 2021 compared to 2020. Similarly, 460 million new bank accounts were opened on the basis of digital identity.

The vibrant start-up eco-system in India is largely driven by its young population. India is currently ranked third globally in its Fintech strength after USA and China. As of October 2022, India had more than 80,000 recognized start-ups spread across 236 districts. India has the third largest start-up ecosystem in the world and with 107 unicorns, India has the 3^rd largest number of unicorns. These point to the entrepreneurial capacities of India, especially its youth.

India’s National Education Policy 2020 is a holistic and futuristic policy based on the foundational principles of access, equality, quality, affordability and accountability. It aims to build the creative potential of every student in keeping with the requirements of the 21^st century.

The Indian Government has initiated a number of people-centric reforms, intended to support the people under the banner “Sabka Saath, Sabka Vikas”, which means “Collective Efforts, Inclusive Growth”. Whether it is reforms aimed at skilling, reskilling and upskilling its people, or reaching clean fuel to people under the Ujjwala scheme, or providing health support under Ayushman Bharat; Mudra Yojana for funding small entrepreneurship; or Vaccine Maitri to reach the Covid-19 vaccines not only to the last person in the country, through the highly innovative digital platform “CoWIN”, but also to millions in other countries in need, the intention is to reach the benefits to the last person.

These initiatives can be replicated in other countries. India can lend its support through information sharing, training and capacity building.  Already, what differentiates India’s international development cooperation activities, undertaken in more than 78 countries, is that it is transparent, consultative, and demand driven, based entirely upon the requirements of the partner countries. It is never imposed with unsustainable conditionalities, unlike some other reprehensible, predatory assistance programmes.

As the largest democracy in the world, representing one-sixth of humanity, India’s biggest priority is to provide decent standards of living to its very young, aspirational population that is peaceful, tolerant, inclusive, and plural.  India’s foreign policy initiatives are aimed at supporting these core Indian civilisational values, simultaneously with its developmental goals and objectives.

Towards this end, India has built a web of partnerships both within its immediate neighbourhood and beyond. It has strengthened its bilateral and multilateral strategic partnerships with the key players in the region, for collectively building a resilient future.

Except for Pakistan, which continues to use terrorism as an instrument of state policy that has curtailed all meaningful interaction, India’s relations with all its other neighbours in the Indian subcontinent have improved exponentially in the last decade. Its “Neighbourhood First Policy” has reset bilateral relations and built bridges of friendship, connectivity, and understanding thorough mutually beneficial cooperation. A greater regional and sub-regional integration is also taking place in trade and investment, as well as infrastructure and energy connectivity, including through groupings like the Bay of Bengal Initiative for Multisectoral Technical and Economic Cooperation (BIMSTEC) and the Bangladesh-Bhutan-India-Nepal (BBIN) cooperation.

India’s further outreach to its extended neighbourhood is summed up in its “Act East” and “Look West” policies, reinvigorating its relations with countries spanning the entire Indo-Pacific. A concerted effort has also been made to enhance cooperation with the Central Asian republics, with whom India shares deep civilisational links and common security challenges.

There is a convergence of interest in economic, political, and strategic outlook with several of India’s key partners. India’s strategic partnership with the US has strengthened and become stronger in the last decade. Today, the US is India’s largest trade and technology partner. India has also expanded its relations with Japan, Australia, and South Korea, injecting new dynamism through recent high-level visits. Europe too is a major strategic partner and economic relations are expected to expand further with the imminent finalisation of the India-EU Free Trade Agreement (FTA). India has transformed its relations with the Gulf countries while simultaneously maintaining high-level dialogue with Iran on vital connectivity projects that are being implemented. India’s strategic partnership with Russia has withstood international pressures from western countries to condemn Russia’s military intervention in Ukraine. In fact, economic ties have expanded, with Russia today as India’s largest supplier of oil.

India has retained its strategic autonomy and avoided taking sides in any great power rivalry. India has also remained honest in its relationships with its strategic partners, with a free and frank assessment of each other’s concerns and priorities.

India’s active participation in regional groupings like the BIMSTEC, the ASEAN-related mechanisms such as the ASEAN-India strategic partnership, the Mekong-Ganga Cooperation, development cooperation with the CLMV countries in ASEAN, the East Asia Summit, the ASEAN Regional Forum, and other arrangements like the QUAD, the Indo-Pacific Economic Framework, I2U2, BRICS, RIC, the Indian Ocean Rim Association, the Forum for India-Pacific Islands Cooperation and the India-Africa Forum Summits- all contribute towards creating a robust multipolar world.

Since the tsunami in 2004, India has been the first responder in its neighbourhood during natural disasters, like the earthquake in Nepal, the water crisis in Maldives or the cyclone in Sri Lanka. In the face of climate change induced natural disasters, the India initiated Coalition for Disaster Resilient Infrastructure (CDRI), has emerged as an important area for international cooperation. India’s world view is encapsulated in the acronym SAGAR, which means Ocean, and represents Security and Growth for all in the Region.

The 30 million strong Indian diasporas, with a large section residing within the Indo-Pacific region, has contributed positively to building bridges between India and the host countries. As law-abiding, hardworking, highly skilled, and high-achieving citizens, the Indian diaspora has also played a very important part in contributing to peace and prosperity, while adhering to inherent Indian cultural values of tolerance, peace, and pluralism. They are welcomed everywhere as a force for good.

Today, India is one of the fastest growing larger economies in the world and expected to be an engine of growth for others. Its 1.4 billion population offers a big market for diversification and building alternative supply chains for international trade and investment. India’s potential and core Indian values are the “India Factor” in securing peace and prosperity for a resilient future. India will continue to play its positive role.

Author Brief Bio: Amb. Preeti Saran is former Secretary (East), MEA, Govt. of India. She is also a member in Governing Council of India Foundation.

Note: This article was published by India Foundation in the Indian Ocean Conference 2023 Theme Paper Booklet.

The region in which Australia is located – the Indo-Pacific – is facing the greatest strategic uncertainty since the end of the Second World War.  That same region is also engine of the global economy – two thirds of global growth to 2030 will come from the Indo-Pacific.¹

Much of this economic growth will have an Indian Ocean dimension. Within the next decade, the world’s top five economies (in purchasing power parity terms) will include two major Indian Ocean states – India and Indonesia.² The Indian Ocean itself hosts more than half the world’s container traffic, as well as critical infrastructure such as ports and undersea cables, and sea lines of communication vital to global energy trade.³

In other words, a resilient Indian Ocean region matters enormously to the world and it matters to Australia. As a nation that sits astride both the Pacific and the Indian Oceans, and whose western shores cover nearly the entire Eastern boundary of the Indian Ocean, Australia has a major stake in the peace, prosperity, and resilience of the Indian Ocean region.

This paper highlights four areas of strength and strategic interest where Australia can help contribute to the resilience of the Indian Ocean region:

1. Advocating for strong regional identity and collaboration
2. Promoting economic integration for regional benefit
3. Leading future energy partnerships
4. Securing regional peace and prosperity
5. Stepping up in future challenges and opportunities

A Region that Matters – Building an Indo-Pacific Identity

With just 25 million inhabitants and located far from many of its markets, regional partnerships and collaboration have always been part of Australia’s world view. Australia has played an especially important role in building global understanding of the importance of the Indian Ocean region. This work started with advocacy, first for the idea of an Asia-Pacific, and then subsequently the concept of an Indo-Pacific.

Neither of these concepts – or the collaboration that has emerged from them – were guaranteed.  As recently as the 1980s, Australia was considered part of a vaguely defined Oceania.  But as both North and Southeast Asian economies grew, bringing more foreign direct investment, Australia and others like Japan and Korea recognised the need for better ways to describe the region, and better ways to collaborate within it.

Australia was at the forefront of efforts to institutionalise the concept of the Asia-Pacific, including through establishment of the Asia Pacific Economic Cooperation Organisation (APEC – an Australian initiative proposed by former prime minister Bob Hawke in Seoul in 1989), the ASEAN Regional Forum (ARF) security dialogue in 1994 and the East Asia Summit (EAS) in 2005.

But in recent years, it became clear that the Asia-Pacific concept was missing something important – India, and South Asia more broadly. Former Japanese Prime Minister Shinzo Abe was the first world leader to articulate an Indo-Pacific strategy. He debuted the concept in his landmark speech – ‘The Confluence of the Two Seas’ – made to the Indian Parliament in 2007.⁴ Subsequently his government released a “Free and Open Indo- Pacific” Strategy in 2016.

Australia was an early adopter of this idea – using it in the 2013 Defence White Paper, as the organizing construct in its 2017 Foreign Policy White Paper, and most recently in its 2023 Defence Strategic Review. We were also a founding member of the only regional organisation that seeks to promote a specifically Indian Ocean identity – the Indian Ocean Rim Association.

There is increasingly no question that for Australia, the Indian Ocean looms large. Just as importantly, the Indian Ocean looms large for other partners as well.  The US changed the name of its Pacific Command to the “Indo-Pacific Command” (INDOPACOM) in 2018 and released Indo-Pacific Strategies under both the Trump and Biden administrations. The EU announced in 2021 its own Indo-Pacific Strategy, as did the UK (termed a “tilt” to the Indo-Pacific). India, Indonesia, Vietnam, ASEAN, the Indian Ocean Rim Association, and many others all have some version of an Indo-Pacific strategy, vision, or construct embedded in their thinking.

Encouraging Economic Integration for a Prosperous Indian Ocean

The idea of the Indo-Pacific has helped encourage a sense of common objectives and interests across the region.  But reaching those objectives requires collaboration, including through economic integration. This is something that’s still missing from the Indian Ocean region.

Australia has experience to share, with a solid track record of advocating for “mega-regional” trade agreements within Asia. Two examples of such “mega-regional” trade agreements stand out.

The first example is the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP – traversing the entire Pacific Rim). Originally conceived as the Trans-Pacific Partnership, the US’ withdrawal threatened the agreement’s survival.  But in 2017, Australia – together with Japan – revived negotiations, with the CPTPP signed by all eleven remaining members only a year later.

The second example is that of the Regional Comprehensive Economic Partnership Agreement (RCEP), for which Australia was the driving force. Taking in the region from Australia northward to Japan, RCEP is the world’s largest trading bloc, accounting for almost half the world’ population, over 30 percent of global GDP, and over a quarter of global exports.  It could have been bigger – but India withdrew from negotiations in 2019.

These two agreements provide some salutary lessons.

First, not only does Australia have a strong commitment to economic integration as a way of building Indo-Pacific prosperity, but it can also step into regional leadership roles when the US falters.

Second, India’s absence from Indo-Pacific economic architecture has limited the potential of these regional trade agreements.

With India set to be the world’s third biggest economy, any efforts to promote Indian Ocean economic integration must include India.  While there’s still much work to do, India’s partial participation in the new US Indo-Pacific Economic Framework (alongside participation from other regional countries including Australia, Japan and ASEAN) holds the potential to closer bind the Indian Ocean with the Pacific.

Australia’s Role in a Resilient Indian Ocean Energy Future

Along with greater economic integration, the Indian Ocean needs its own energy security and is pivotal to the energy security of others.

The Indian Ocean’s importance to traditional global energy security is well established.  It is home to 40 per cent of the world’s offshore oil production (which includes significant reserves of liquified natural gas off the coast of Western Australia),⁵ as well as about 80 per cent of the world’s maritime oil trade traverses the Indian Ocean.⁶ It’s especially important for China, which relies on shipping lanes through the Indian Ocean and the Malacca Straits chokepoint for a majority of its imports.⁷

As the world transitions to clean energy, Australia – and therefore the Indian Ocean – will remain important. The visit of Japanese Prime Minister Kishida Fumio to Perth Western Australia in October of 2022 included a focus on Australia’s role as a source of rare earth elements, lithium, other critical materials, as well as hydrogen, making it clear that the road to future energy for the Indo-Pacific runs through Australia.

The largest opportunity is likely to be in ‘critical minerals’, and associated value chains such as batteries for electric vehicles (EVs) and grid storage. The International Energy Agency estimates critical minerals production for clean energy must at least quadruple to 28 million tonnes per annum by 2040.⁸ The challenge is that just a few countries dominate extraction of key minerals. China controls most processing and manufacturing activity – for example it produces more than 90 per cent of the rare earths used in semiconductors and magnets.

As the supply chain disruptions of COVID showed so clearly, reducing market concentration – in any sector – is a good thing.  It’s even more important in such a critical sector as clean energy. Australia of course will be a key partner – it already produces about half the world’s lithium. It’s also a leading supplier of other minerals needed for the energy transition, including bauxite, cobalt, rare earths, vanadium, graphite, and nickel.⁹

But the challenges of these complex energy supply chains can’t be solved by one country alone.  Australia might have world-leading natural resources, but it will need to work with countries – including in the Indian Ocean – to develop new processing pipelines and off take agreements.

India for example is seeking to become a major rival to China in clean energy manufacturing. The Australia-India Economic Cooperation and Trade Agreement of 2022 eliminated tariffs on most Australian critical minerals.¹⁰ The India-Australia Critical Minerals Investment Partnership was also unveiled in 2023.¹¹

Indonesia is also looking to Australia as a potential source of lithium, to complement its own vast nickel reserves and support its aspirations to become a major EV manufacturer.¹²

Australia and other Indian Ocean countries can work more closely together to build up trusted and resilient critical minerals value chains and deliver an equitable share of the economic returns. Work through regional institutions could complement bilateral partnerships. The Quad has a dedicated critical minerals stream.¹³ So too does the US-led Indo-Pacific Economic Framework for Prosperity.¹⁴

Indian Ocean Security Partner

Australia’s national Defence Strategic Review, published in late April, identified the Indian Ocean as a key strategic area, with the Northeast Indian Ocean part of the primary area of military interest for Australia’s National Defence. It acknowledged that Australia’s Defence Cooperation Program needs to expand into the Indian Ocean, its relationship and cooperation with India and Japan needs to grow, and the importance of investment in regional architecture for security outcomes.

Australia has had a longstanding role in the security of the Indian Ocean. Its dedication to regional stability has taken shape through various security avenues, including:

• The considerable projection capability of its military, expected to grow under the trilateral Australia-U.K.-U.S. AUKUS agreement.
• The Australian Defence Force’s maritime surveillance patrols in the Northern Indian Ocean.
• Its treaty alliance with the United States, which has helped to uphold global commons as well as secure shipping and sea lanes of communication, and which will certainly be enhanced by the AUKUS agreement.
• The ambitious agenda of the Quad grouping of Australia, India, Japan and the United States, which will be further highlighted in late May when the leaders of these four countries meet again in Sydney.

The various initiatives of both AUKUS and the Quad are directly related to the resilient future envision by the annual Indian Ocean conference and highlight Australia’s commitment to both traditional and non-traditional areas of security.

Facing Future Challenges Together

The global challenges with which the world is now grappling traverse the Indian and Pacific Oceans – challenges like climate change, maritime insecurity, the rise of China and its use of economic coercion against Australia and other partners, great power rivalry, terrorism, natural disasters and environmental insecurity. The Asia-Pacific construct no longer captures these interlinked issues, countries, or Australia’s interests. That is in part how the concept of the Indo- Pacific started to gain currency.

As political leaders throughout the Indian Ocean gather to discuss the myriad challenges facing the region including climate change, security, infrastructure and more, it will become increasingly apparent that the technological and industrial responses to many of these challenges will require a cooperative approach to ensure that we have the necessary materials to enable such responses.

Australia will continue to take its place in the Indian Ocean Region tackling the substantial shared existing challenges and emerging threats facing the region.  We know that regional identity matters, and the considerable progress to date means there is a firm foundation for future collaboration.

Authors’ Brief Bio: Prof. Gordon Flake is the Director; Chief Executive Officer, Perth USAsia Centre, The University of Western Australia, Dr. Lisa Cluett, External Relations Director, Perth USAsia Centre and Dr. Kate O’Shaughnessy, Research Director, Perth USAsia Centre

Note: This article was published by India Foundation in the Indian Ocean Conference 2023 Theme Paper Booklet.

References:

1. “The Indo-Pacific will create opportunity”, Chapter two: A Contested World, 2017 Foreign Policy White Paper, https://www.dfat.gov.au/sites/default/files/minisite/static/4ca0813c-585e-4fe1-86eb-de665e65001a/fpwhitepaper/foreign-policy-white-paper/chapter-two-contested-world/indo-pacific-will-create-opportunity.html.
2. Ibid.
3. “Australia and the Indian Ocean Region”, Australian Government: Department of Foreign Affairs and Trade, https://www.dfat.gov.au/international-relations/regional-architecture/indian-ocean/Pages/indian-ocean-region.
4. “Confluence of the Two Seas”, Speech by E. Mr Shinzo Abe, Prime Minister of Japan at the Parliament of the Republic of India, https://www.mofa.go.jp/region/asia-paci/pmv0708/speech-2.html.

5. “Australia and the Indian Ocean Region”, Australian Government: Department of Foreign Affairs and Trade, https://www.dfat.gov.au/international-relations/regional-architecture/indian-ocean/Pages/indian-ocean-region.
6. “The Indian Ocean Region May Soon Play a Lead Role in World Affairs”, The Wire, January 16, 2019, https://thewire.in/world/the-indian-ocean-region-may-soon-play-a-lead-role-in-world-affairs.
7. Giulio Gubert. “Myanmar and the Belt and Road Initiative. A solution to China’s Malacca Dilemma?”, Lee Kuan Yew School of Public Policy, National University of Singapore, June 04, 2019, https://lkyspp.nus.edu.sg/gia/article/myanmar-and-the-belt-and-road-initiative.-a-solution-to-china’s-malacca-dilemma; Paweł Paszak. “China and the ‘Malacca Dilemma’”, China Monitor, February 28, 2021, https://warsawinstitute.org/china-malacca-dilemma/.
8. “The Role of Critical Minerals in Clean Energy Transitions”, International Energy Agency, May 2021, https://www.iea.org/reports/the-role-of-critical-minerals-in-clean-energy-transitions.
9. “World Rankings”, Australian Government: Geoscience Australia, https://www.ga.gov.au/digital-publication/aimr2022/world-rankings.
10. “Australia-India ECTA benefits for the Australian critical minerals and resources sectors”, Australian Government: Department of Foreign Affairs and Trade, https://www.dfat.gov.au/trade/agreements/in-force/australia-india-ecta/outcomes/australia-india-ecta-benefits-australian-critical-minerals-and-resources-sectors.
11. “Milestone in India and Australia critical minerals investment partnership”, Australian Government: Department of Industry, Science and Resources, https://www.minister.industry.gov.au/ministers/king/media-releases/milestone-india-and-australia-critical-minerals-investment-partnership.
12. Emma Connors. “Indonesia lures EV makers in race to secure nickel supplies”, Australian Financial Review, April 23, 2023, https://www.afr.com/world/asia/indonesia-lures-ev-carmakers-in-race-to-secure-nickel-supplies-20230421-p5d2f4.
13. Tom McIlroy, “Australia rallies Quad on critical minerals security”, Australian Financial Review, July 13, 2022, https://www.afr.com/politics/federal/australia-rallies-quad-on-critical-minerals-security-20220713-p5b17r.
14. “Speech to the Future Facing Commodities Conference, Singapore”, Australian Government: Department of Industry, Science and Resources, April 05, 2023, https://www.minister.industry.gov.au/ministers/king/speeches/speech-future-facing-commodities-conference-singapore.

 

 

Post the pandemic and with the on-going war in Ukraine, a new world order is emerging. The US dominance as the sole superpower is under challenge and the future is likely to see a multi-polar world. Today, with the world in flux, partnerships would be necessary, both for peace and prosperity as well as for a resilient future.

The Indian Ocean littorals and its island territories are home to over 2.6 billion people, which is roughly about 40 percent of the global population. Spread over 33 million square kilometers of land area, the region consists of 50 states which are least integrated, are generally poor and are still developing. In terms of energy resources, while 40 percent of the world’s offshore oil production comes from the Indian Ocean, about 80 percent of the world’s oil shipment passes through its waters.

Natural disasters such as cyclones and tsunamis occur frequently in this region, impacting all the littoral countries. The effects of climate change and environmental threats such as pollution are also a cause of concern. Addressing these issues would require a collective effort on the part of all countries. If the region is to become prosperous, it would have to knit a collective architecture, in the economic, financial and security domains. This would be necessary if we are to usher in an era of peace and stability and overcome environmental challenges.

The Indian Ocean region (IOR) has its own distinct history and geography, cultural linkages, and religious beliefs. It is today, central to world’s geopolitics, and thus has to be viewed through the lens of its own distinct identity, rather than as an adjunct to the larger Indo-Pacific. Historically, India’s west coast has been connected for millennia with the East Coast of Africa, the Gulf and with all the island nations in the western Indian Ocean. On similar lines, India’s east coast has such a connectivity with countries in Southeast Asia. Archeological and genetic findings point to the presence of extensive trade and commerce being carried out across the sea lanes of communication, large scale migrations and to the intermixing of communities. This led to the interflow of religion, art, culture architecture and societal practices. Sanjeev Sanyal’s brilliantly researched book, “The Churn of Oceans” supports the argument that the IOR is a distinct entity for economic and security partnership.

Robert Kaplan, in his popular authentic work, “Monsoon”, writes: “The Indian Ocean Region is more than just a stimulating geography. It is an idea because it provides an insightful visual impression of Islam and combines the centrality of Islam with global energy politics and the importance of world navies, in order to show us a multi-layered, multipolar world above beyond the headlines in Iraq and Afghanistan; it is also an idea because it allows us to see the world whole, within a very new and yet old framework, complete with its own traditions and characteristics, without having to drift into bland nostrums about globalization.” He subsequently writes, “it is the intermingling of challenges in each place—religious, economic, political, environmental—rather than each challenge in isolation, that creates such drama.”

During British rule, the Indian Ocean, especially for the period 1858-1947, was thought of as a ‘British lake,’ with Britain managing the administration of this vast area. The British centralized their control over the littorals through telegraph cables across the ocean. The ports of Calcutta, Bombay, and Madras enabled British shipping transiting between the Indian and the Pacific Oceans and consequently, by the middle of the 19^th century, the Indian Ocean was deeply connected to international shipping routes and global trade. This continued, despite the disruptions caused by two world wars, through the middle of the 20^th century. Thereafter, two transformational events—decolonization and the start of the Cold War, brought change to the Indian Ocean. The Cold War split the world into two camps. Decolonization led to independence from European control and development of new trade routes and economic networks. The Straits of Malacca and the Straits of Hormuz became nodes in global shipping network in IOR along with the development of new ports. Today, partnerships among the littorals and island nations can provide great potential for prosperity and peace to flourish in the IOR.

While peace is a desirable outcome, it can only come about through adherence to the rule of law by all countries and stakeholders. However, the vastness of the ocean does give rise to the emergence of traditional and non-traditional threats. With trade increasing at a phenomenal pace, lax ocean governance can be a disruptor, with negative consequences to the littoral nations. Security partnerships amongst the IOR resident nations can protect the region from the fallout of these threats, both natural and manmade. Institutionalised structures, embedded with modern technology, could mitigate to a large extent, the impact of these threats.

A matter of deep concern is the great power rivalry that is unfolding in the larger Indo-Pacific. This contestation will only increase in the coming years. The littoral countries will be hard-pressed to maintain neutrality, but even so, the unfolding situation will likely lead to increased tensions, which in turn would come at a cost, adversely impacting both the security as well as the prosperity and growth agenda of the littoral countries. In addition, some countries have taken huge loans from China. The financial transactions which have been undertaken are opaque and the term and conditions of the loans are such that the debtor country is hard-pressed to repay the loan. Consequently, debts have mounted to the extent that repayment has been negotiated by leasing of strategic assets, practically losing some degree of sovereignty. This also impacts on regional security and needs to be addressed through cooperative or partnership mechanisms.

Significant non-traditional threats also exist in the IOR. More often than not, Navies and Coast Guards become the first responders and are called upon to rescue the people so affected. What has been experienced frequently over the last few years is the spate of instances related to terrorism, piracy, human migration, drug and narcotics smuggling as also environmental issues such as tsunamis and cyclones. In case of natural disasters, people need immediate assistance in terms of shelter, food and medical aid, before resettlement is considered by local governments.

As majority of countries in the IOR littorals are poor and developing, poverty remains an important issue. Consequently, the need of the hour is a structured organization which can respond quickly to mitigate suffering. Therefore, what we need is to build a resilient architecture for mitigating/preventing damage by environmental/climate change.

The Lakshman Kadirgamar Institute, based in Sri Lanka, has estimated that the Indian Ocean economy would account for 20% of global GDP by 2025. Growth of trade in the region has outperformed the world economy since 2000. For the period 2000-2008, trade grew at an annual rate of 9.4 percent. Thereafter it slowed down to 4.8 percent for the period 2011-2017, due to the impact of the global financial crisis. This compares favorably with the world trade volume growth, which stood at 6.9 percent and 3.9 percent respectively, for the above periods. This reflects the increasing openness of the region’s economies, demonstrates the importance of trade to the region and highlights the fact that Indian Ocean economies are more closely integrated into global trade flows than the world at large.

The pandemic brought to the fore supply chain disruptions in the world due to manufacturing hubs becoming non-functional on account of workers being forced to stay at home, even if fit to work. As most of these hubs were located in China, it forced major industrial houses to consider shifting some of their manufacturing units to different IOR countries. This process has started, though several challenges remain, chief among them being the limited capacity of many ports in the IOR, such as port infrastructure in Tanzania, Yemen, Myanmar, to handle the growth of maritime traffic. There are also issues related to border clearance excise and custom duties checks which delay the clearance and onward movement of goods.

Usage of new technologies, especially of artificial intelligence (AI) will need to be employed to overcome these bottlenecks. Governments in the IOR littorals need to precisely identify challenges they may encounter and consider remedial measures that need to be taken. Transparent financiers are available and so are partner countries. This is where partnership becomes key to resilient prosperity. India, Japan, and several African countries have launched Asia-Africa growth corridor to invest in a transparent manner to the countries needing assistance. This will prevent them falling prey to high interest rate and unacceptable terms and condition loans. The debt trap is very evident in the IOR.

High tariffs are another issue which could become a barrier to trade growth. Partnerships amongst IOR countries, could help alleviate such problems, by concluding agreements on Free Trade or on Standard Tariff. This will essentially guide the future of growth of economic activities in the IOR. But more challenges remain. As per Wignaraja, Collins and Kannangara, strengthening regional economic governance and narrowing development gaps are also central to ensuring that the region realizes its economic potential. This is essential for the prosperity and sustenance of the IOR.

In an attempt to invite business in the form of merchant ship support for transiting traffic countries, we must exhibit due care to prevent falling in the trap of business models which can subsequently throw up security challenges for the countries in the region, and also lead to the mortgaging of their sovereign assets. We need to integrate the region in priority areas such as health & Pharmaceuticals, agriculture & agro-processing, disaster management and skill enhancement. All these would boost people to people relations across the region, which in turn would form the basis for better understanding and smooth operations.

Connectivity between ports, such as Jamnagar in Gujarat with Djibouti in the Gulf of Aden, Mombasa and Zanzibar with ports connected to Madurai, and Kolkata with Sitwe in Myanmar indicate, that in the maritime world, development and prosperity are intertwined. This calls for partnerships amongst regional nations. The IOR needs better connectivity with a greater spread as also better infrastructural development in their hinterland.

Author Brief Bio: Vice Admiral Shekhar Sinha is the Chairman of Board of Trustees, India Foundation

Note: This article was published by India Foundation in the Indian Ocean Conference 2023 Theme Paper Booklet.

References

1. Alexander E Davis & Jonathan N Balls. “The Indian Ocean Region in the 21st Century: geopolitical, economic, and environmental ties” (Australia India Institute).
2. Robert D. Kaplan. “The Indian Ocean and the Future of U.S. Power,” The Globalist, October 30, 2010, https://www.theglobalist.com/the-indian-ocean-and-the-future-of-u-s-power/.
3. Robert D. Kaplan. Monsoon: The Indian Ocean and the Future of American Power (Random House Trade Paperbacks, September 2011)
4. Sanjeev Sanyal. The Ocean of Churn: How the Indian Ocean Shaped Human History (India: Penguin Random House, August 2016)

Introduction

As a result of the Indo-Pacific region’s growing geopolitical importance, Asia will eventually emerge, with significant Asian economies like China, India, and the ASEAN countries playing strategic roles. Geostrategic and geoeconomic factors both play a role in maritime diplomacy in the Indo-Pacific. In terms of population, resources, transit routes, growing markets, megacities, and enormous market potential, the Indo-Pacific has become a “blue-eyed region” of the world.

The Indian Ocean plays a significant geopolitical role in the Indo-Pacific regional order. It is a vital trade route connecting the Middle East, Asia, and Africa, making it a critical global shipping lane. As such, it has become a hotbed for competition among major powers, including the United States, China, India, Australia, and Japan.

The Indian Ocean also holds a significant strategic location, serving as a gateway to key regions such as the Persian Gulf, East Africa, and Southeast Asia. This makes it an essential area for military and naval operations, as well as for projecting power and influence in the region. Moreover, the Indian Ocean is home to several small island nations, including the Maldives, Mauritius, and Seychelles, which have become important players in the region’s geopolitics. These countries have unique maritime and economic interests that have drawn the attention of major powers seeking to expand their influence in the region.

In the Indo-Pacific era, Vietnam and India have intensified their strategic partnerships with an emphasis on growing their economic relations, security cooperation, and cultural exchanges. Both nations have stated their shared commitment to preserving the region’s peace, stability, and development.

The changes in the strategic position of the Indian Ocean under the background of the Indo-Pacific era

The strategic position of the Indian Ocean is increasingly important in the current Indo-Pacific era. This is due to a number of factors, including the rise of China as a regional power, the increasing importance of India as a major player in the region, and the growing importance of energy resources and sea trade routes that pass through the Indian Ocean.

One of the key changes in the strategic position of the Indian Ocean is the increasing focus on naval power projection. Countries such as China and India are investing heavily in their naval capabilities in order to secure their interests in the Indian Ocean region. This has led to an increase in naval patrols and exercises, as well as a rise in the number of naval bases and port facilities being built along the Indian Ocean coast.

Another important change is the growing importance of energy resources in the Indian Ocean. The region is home to some of the world’s largest oil and gas reserves, and many countries are looking to secure their access to these resources. This has led to increased competition among countries for control of key sea lanes and maritime chokepoints, such as the Strait of Hormuz and the Bab el-Mandeb Strait.

In addition to these factors, the Indian Ocean is also playing an increasingly important role in global trade. The Indian Ocean is a vital conduit for international trade, as it is home to many of the busiest shipping routes in the world. It is a vital link between the eastern and western hemispheres, connecting three continents: Asia, Africa, and Australia. As a result, many nations are trying to protect their maritime interests in the area and secure their access to these sea lanes. With so many strategic ports and naval bases, the Indian Ocean is a significant area for military activity and geopolitical interests.

Generally, in the Indo-Pacific age, the strategic importance of the Indian Ocean is growing. The region is likely to continue to be a focal point of geopolitical competition and strategic relevance for years to come as countries continue to invest in their naval capabilities and compete for control of vital resources and sea passages.

The driving factors for the development of the comprehensive strategic partnership between Vietnam and India

Driving factors for the development of the India-Vietnam comprehensive strategic partnership After Modi implemented the “Act East Policy,” along with India’s shift to the Asia-Pacific region, Vietnam’s importance to India has become increasingly prominent, and Vietnam also needs strategic support from India. On April 15, 2022, Indian Prime Minister Narendra Modi had a telephonic conversation with General Secretary of the Communist Party of Vietnam Central Committee Nguyen Phu Trong. During the call, Modi stated that Vietnam is one of the important pillars of India’s “Action East Policy” while Nguyen Phu Trong expressed his hope to strengthen the comprehensive strategic partnership with India. Judging from reality, India and Vietnam are further deepening their cooperation, driven by interest factors such as geopolitics, economic and trade cooperation, and the South China Sea issue.

GEOPOLITICAL INTERESTS

As important countries in South Asia and Southeast Asia, respectively, India and Vietnam have strong political ambitions. From India’s perspective, Vietnam can serve as an important starting point for India to strengthen its relationship with ASEAN and integrate into the Asia-Pacific region. Since Vietnam joined ASEAN in 1995, it has increasingly become a pivotal force in the ASEAN region. In order to strengthen its influence in the ASEAN region and expand its strategic interests in the Asia-Pacific region, India is trying to use Vietnam to strengthen its relations with ASEAN countries. From the perspective of actual development, Vietnam has played an important role in India’s closer relationship with ASEAN. When serving as the coordinator of ASEAN-India relations from 2015 to 2018, Vietnam actively promoted cooperation between India and ASEAN countries. It not only invited India to participate in exchanges and dialogues in various fields within ASEAN but also actively participated in and organized meetings on ASEAN-India relations. It can be said that Vietnam has promoted exchanges and cooperation between India and ASEAN countries in political, economic, social, and cultural fields during its tenure as the coordinator of ASEAN-India relations and the rotating chair of ASEAN. On this basis, Vietnam can also become an important partner for India’s integration into the Asia-Pacific region. Indian Foreign Minister Jaishankar emphasized at the fifth anniversary ceremony of the establishment of the Vietnam-India comprehensive strategic partnership that India has always regarded Vietnam as an important cooperative partner and hoped that the two countries would continue to fully tap their existing potential and contribute to the economic development of their respective countries. Therefore, India intends to strengthen cooperation with ASEAN through Vietnam and increase India’s influence in ASEAN.

Judging from Vietnam’s strategic demands, India is an important helper for it to implement the “major powers balance strategy” and seek the status of regional power. Since the implementation of the “international integration” strategy, Vietnam’s comprehensive national strength has improved significantly, and with the improvement of national strength, Vietnam has also begun to pursue the “dream of a regional power.” From the perspective of diplomatic strategy, Vietnam has two strategic demands. The first is to pursue a foreign policy of “balance among major powers.” By maintaining a strategic balance among major powers and good bilateral relations with major powers outside the region, Vietnam’s sovereignty, independence, and territorial integrity are maintained. The second is to continuously improve its comprehensive national strength by strengthening cooperation with major countries, thereby enhancing Vietnam’s international status and influence. Since the reform and opening up, Vietnam has gradually matured its foreign policy of “Great Powers Priority, Neighboring Countries Priority, and Traditional Friendly Countries Priority.”

As an important country in South Asia and the Indian Ocean region, India has important strategic value for the realization of Vietnam’s diplomatic goals. One is that Vietnam can use India’s power to hedge against China’s influence in Southeast Asia; the other is that Vietnam can use its strategic relationship with India to promote the rapid development of its economy, trade, military, science, and education, thereby enhancing its comprehensive national strength.

MUTUAL NEEDS OF ECONOMIC AND TRADE DEVELOPMENT

Economic cooperation has always been the core area of India-Vietnam cooperation, and as both countries have entered a period of rapid economic development, economic and trade cooperation have also become an important basis for promoting the development of a comprehensive strategic partnership between India and Vietnam. Since Modi came to power, he has always emphasized the importance of the economy, insisting that the country’s diplomacy must be subordinate to its own economic interests and serve the country’s development strategy needs. For Vietnam, which is in a period of rapid industrialization, strengthening economic and trade cooperation with other countries is also an important part of its foreign relations. Therefore, India and Vietnam have common interests and needs in promoting economic and trade cooperation.

In recent years, trade between India and Vietnam has developed rapidly. When Modi came to power in 2014, the bilateral trade volume between India and Vietnam was only more than 5 billion US dollars, but by 2019, the bilateral trade volume between India and Vietnam had reached nearly 11.2 billion US dollars, more than double that of 2014. In 2020, due to the impact of the new crown pneumonia epidemic, the bilateral trade volume between India and Vietnam was only US$9.6 billion. However, as the epidemic levelled off, trade relations between the two countries gradually resumed. According to Indian data for the financial year April 2021-March 2022, bilateral trade posted a growth of 27% and reached US$ 14.14 billion Embassy of India Hanoi, Vietnam, 2023. It can be seen that the trade between the two countries still maintains a strong development trend.

In addition, the industrial structure of India and Vietnam is being gradually optimized, and the complementarity of commodities is being enhanced, which gives the economic cooperation between the two countries a lot of room for development. At present, India, which is in a period of industrial expansion, has a greater demand for raw materials and other products from ASEAN countries, including Vietnam. After Vietnam undertook the industrial transfer of Western developed countries, its products gradually entered the Indian market. At the same time, India has taken a fancy to Vietnam’s advantages in the fields of market, resources, and manpower, while Vietnam hopes to receive financial and technical support from India in fields such as information technology, automobiles, and steel.

According to data from the General Administration of Vietnam Customs, in 2021, India’s exports to Vietnam will reach US$6.95 billion, an increase of 56% over 2020, and Vietnam’s exports to India will reach US$6.25 billion, an increase of 20% over 2020. Among them, Vietnam’s major exports to India include common metals, computers, electronic products and parts, various communication equipment and parts, mechanical equipment, tools, and spare parts. Compared with 2020, the main products with the higher growth rate of Vietnam’s exports to India in 2021 include plastic raw materials (up 231%), chemicals (up 162%), rubber (up 138%) and coal (up 128%). The main products that India exports to Vietnam account for a large proportion of steel and steel products, metals, cotton, machinery and equipment, etc.

Among India’s exports to Vietnam in 2021, iron and steel exports will be the highest at nearly US$1.4 billion, accounting for 20% of India’s total exports to Vietnam; machinery and equipment, tools, and other spare parts exports will be US$428 million, accounting for India’s exports to Vietnam. 6.2% of the total; exports of other common metals amounted to $405 million, accounting for 5.8% of India’s total exports to Vietnam. Therefore, judging from the bilateral trade volume between India and Vietnam and the types and growth rates of import and export products, the economic complementarity between the two countries is constantly improving, which is of great significance for promoting the import and export trade between India and Vietnam.

Indian Ocean’s Role in Vietnam – India Strategic Engagement

The Indian Ocean plays a significant geopolitical and geoeconomic role in the relationship between India and Vietnam. The ocean is a major trade route that connects the two countries and facilitates the exchange of goods and services. India and Vietnam have a long history of economic and cultural ties dating back to the Champa kingdom in Vietnam and the Indianized kingdoms of Southeast Asia.

Strong historical ties, high-level visits, and solid institutional frameworks characterize the bilateral relationship between India and Vietnam. This is demonstrated by changing trade and investment patterns between the two nations, the creation of bilateral institutional frameworks, and a rise in the focus on “specialized” areas of cooperation, such as those involving the purchase of defence equipment. India and Vietnam upgraded their strategic partnership (2007–2017) into a comprehensive strategic partnership just one year earlier, in 2016, marking the end of their 45-year diplomatic relationship.

Both countries share a strategic interest in maintaining the security and stability of the Indian Ocean region. They have been working together to promote maritime security and counter piracy in the region.

The relationship between India and Vietnam can help promote peace and stability in the Indian Ocean region and Indo-Pacific region in various ways:

• Shared strategic interest: Both India and Vietnam share a strategic interest in maintaining peace and stability in the region. They have common concerns over China’s expansionist policies and maritime assertiveness in the South China Sea. Thus, by collaborating together, they can create a balance of power in the region and counter any potential threat to their security.
• Economic ties: India and Vietnam have strong economic ties, with bilateral trade reaching over $14 billion. By enhancing their economic cooperation and trade, they can foster economic growth and development in the region, which can contribute to stability.
• Defense cooperation: India and Vietnam have been cooperating in the field of defense, including training, joint exercises, and defense equipment procurement. By collaborating in this area, they can enhance their defense capabilities and create a more secure environment in the region.
• Cultural and people-to-people ties: India and Vietnam also share cultural and people-to-people ties, which can help deepen their understanding and trust. This can lead to stronger cooperation in various areas, including security, economic development, and cultural exchange.

Overall, by working together, India and Vietnam can promote peace and stability in the Indian Ocean region and Indo-Pacific region, which can benefit not only themselves but the entire region.

There are several reasons why Vietnam should consider India as a reliable partner for stability and peace in the East Sea and the Indo-Pacific region:

• Strategic location: India is strategically located in the Indian Ocean Region (IOR), which is a critical region linking the East and West. Vietnam, on the other hand, is located in Southeast Asia and has a long coastline that shares borders with the East Sea. India’s strategic location can help in ensuring the safety and security of sea-lanes in the Indo-Pacific region, including the East Sea.
• Shared commitment to regional stability and peace: India and Vietnam share a commitment to regional stability and peace. Both countries are members of the ASEAN Regional Forum (ARF) and have been working together to promote peace and stability in the region.
• Defense cooperation: India and Vietnam have been strengthening their defense cooperation in recent years. India has been providing naval ships to Vietnam, and the two countries have been conducting joint naval exercises. This cooperation can help in enhancing maritime security in the East Sea and the Indo-Pacific region.
• Economic ties: India and Vietnam have been strengthening their economic ties. India is one of Vietnam’s top ten trading partners, and the two countries have set a target of $15 billion in bilateral trade. This economic cooperation can lead to greater stability and peace in the region.
• Cultural ties: India and Vietnam share cultural ties that date back centuries. These ties can help in enhancing people-to-people contacts and promoting greater understanding between the two countries.

In conclusion, India can be a reliable partner for Vietnam in promoting stability and peace in the East Sea and the Indo-Pacific region due to its strategic location, shared commitment to regional stability and peace, defense cooperation, economic ties, and cultural ties.

Trends in Vietnam-India Relations

In the future, in order to achieve their respective national strategic goals, Vietnam and India will further strengthen bilateral cooperation on the one hand and seek their own strategic autonomy on the other.

First, economic, trade, security, and defense cooperation are still important pillars for the development of bilateral relations. Since there are many consensuses on the economic level of the “Indo-Pacific Strategy” between Vietnam and India, bilateral and multilateral economic cooperation between the two countries will continue to deepen in the future. In the field of security and defense, both India and Vietnam will focus on strengthening their own national defense and security construction in order to pursue national strategic security.

Second, Vietnam and India bilateral relations will become more balanced and comprehensive. Since India and Vietnam established a comprehensive strategic partnership, in addition to high-frequency interactions in the fields of politics, economy, trade, security, and defense, the two countries are also actively promoting exchanges and cooperation in other fields. As two rising countries in Asia, India and Vietnam not only have great potential for economic development but also have great room for cooperation in some emerging fields. Therefore, future bilateral relations between the two countries will be more comprehensive and balanced.

Third, Vietnam and India will seek their own strategic autonomy and avoid getting involved in the vortex of strategic struggles among major powers. In the future, the cooperation between India and Vietnam will be more based on their own strategic interests, adhere to the independence of foreign strategy, and not be too tied to the strategic track of a certain country, so as to avoid being involved in the political vortex of power struggles among major powers.

Authors Brief Bio: Vu The Cuong is the Deputy Director, Centre for Indian Studies, Ho Chi Minh National Academy of Politics, Vietnam and Dr. Do Khuong Manh Linh is a Researcher at Centre for Indian Studies, Ho Chi Minh National Academy of Politics, Vietnam

Note: This article was published by India Foundation in the Indian Ocean Conference 2023 Theme Paper Booklet.

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