India Enters China's Backyard

Last month, Indian President Pratibha Patil embarked on a week-long visit to northeastern Asia in a bid to strengthen ties with the region’s emerging democratic power brokers. The trip comes just a month after China finished its latest charm offensive in Europe, with Beijing extending its hand to a collection of debt-saddled but still-powerful states.

The significance of this visit should not be overlooked. While China seeks to expand its reach and investment to all corners of the globe, India is taking the opportunity to bolster its relationships with countries traditionally in Beijing’s sphere of influence.

Patil’s trip focused on enhancing relations with two countries - South Korea and Mongolia – in order to reap a wide range of benefits for Delhi. India continues to seek diversity with new economic and strategic partnerships to complement its established foreign ties which are currently narrowed to a few silos. The state visit began in Korea from June 25-26 as both sides used it as a platform to announce their growing partnership on a variety of themes such as civil nuclear cooperation, increased trade and enhanced defense ties.

The crown jewel of this visit was the nuclear pact agreed by both parties which will allow South Korea to export its nuclear technology and expertise to India. By signing the agreement, South Korea becomes the ninth country to enter into a nuclear partnership with New Delhi.

Previously, there were several obstacles to such a deal with India as a result of its nuclear weapons program and its sustained refusal to accede to the Nuclear Non-Proliferation Treaty. However, as a result of intense US-led lobbying, India was granted a waiver from the Nuclear Suppliers Group in late 2008. This effectively removed most hurdles for countries that desired civil nuclear trade deals with the emerging Indian economy.

How will the nuclear pact provide tangible benefits to both parties? For India, the deal is important as its economy and industrial base continue to growth rapidly and energy demands are pushed to a maximum. India is hoping that a significant expansion of its nuclear energy sector will provide the necessary electricity for industrial production to continue growing.

The agreement also helps further India’s attempts to normalize its relations with the international non-proliferation regime, with eventual aspirations to be recognized as a peaceful nuclear weapons state and not a nuclear pariah.

While the deal continues to boost India’s energy policies, it is arguably of greater importance to Korea, which has grown into a significant participant in an elite club of civil nuclear energy traders. Seoul is fresh off the success of winning a hard-fought battle for the rights, awarded in 2009, to build four nuclear reactors in the United Arab Emirates. The contract is said to be worth nearly US$40 billion. Last year, Korea also signed a US$130 million agreement with Jordan to build that country’s first research reactor. And Seoul is not stopping there as it continues to explore potential partnerships with other markets hungry for nuclear energy including China, Malaysia, Indonesia and Turkey.

Let’s be clear that this latest tryst is fundamentally rooted in economics. However, there are spillover benefits from the nuclear partnership that will serve to improve strategic relations between the two and also further common goals on Asia’s future. Seoul and New Delhi are two of the largest and most prosperous democracies in Asia. Despite their differences, both countries have a strategic vision of the continent that promotes democracy and fewer regulations on foreign investment.

Geopolitically, the two states have aligned priorities aimed at building upon a strategic hedge – supported by other regional players such as the United States, Japan and Vietnam -- against the emergence of China and the possibility of a Sino-centric continent. The partnership also makes sense for Seoul considering that it allows the administration of President Lee Myung-Bak to refrain from entering into a more fulsome alliance with Japan, which remains politically sensitive.

China has reason to worry about a growing Korea-India partnership, but continues to make the shrewd calculation that this is a pact built upon economics and – at least currently – lacks strategic depth. Geography alone gives China a big advantage and India does not have the naval resources to sufficiently bridge that gap. While the US will support increased Indo-Korean ties, even it cannot change geographic realities.

(Jonathan Berkshire Miller is a public sector analyst on the Asia-Pacific region. The views expressed are strictly his own.)