After a hesitant start in the 1990s during the regime of then Prime Minister Narasimha Rao, India's 'Look East' policy seems to be gradually maturing. This became evident during the third India-ASEAN summit held in Vientiane, capital of Laos, where India reached an agreement with Association of South East Asian Nations (ASEAN) countries on "'ASEAN-India Partnership for Peace, Progress and Shared Prosperity".
Initially, when India showed its keenness to associate with the then fast growing economies of Southeast Asia they were somewhat reluctant. There were a number of reasons for it. First, Indian economy was not doing well and India was seen as a country of outmoded systems. ASEAN countries also believed that economic progress was not possible within a democratic polity. ASEAN was also apprehensive that association of India and Pakistan with the grouping might lead to introducing the Kashmir conflict in the organisation.
But, things are different now. For the last several years Indian economy has been growing at a healthy pace of over 6 to 7 percent, whereas at least half of ASEAN members are quite poor. Countries like Laos now look to India to help modernize their agriculture.
India has emerged as a software superpower. At least 1400 Indian companies are operating in Singapore and a large number of them are in the information technology sector. Moreover, some of the Southeast Asian countries have significant capability in computer hardware. Thus both sides are complementary in this area.
In the meantime, the forward march of Southeast Asian economies was halted for a while in the late 1990s by the currency crisis. Moreover, in recent times, these countries have also faced problems of fundamentalism and al Qaida brand of terrorism. India, on the other hand, has been free from both. Even the terrorism faced by India was not indigenous and was of cross-border variety. For these reasons, India is now being held in high esteem by these nations.
Realizing the possible benefits to both sides, India and ASEAN decided to deepen this relationship and signed the partnership pact at the Vientiane summit. The partnership pact is of major significance and sets the agenda for New Delhi's ties with the region. It reflected the belief of ASEAN that the future lies in working together with India. The agreement covers a wide range of issues, from a call for collective action to fight global terrorism to expanding economic ties. It envisages intensive cooperation on political and security issues. On terrorism and other crimes, the agreement says cooperation between India and ASEAN must be effectively strengthened and expanded to combat the scourge. It also calls for international linkages for intelligence and information sharing, as well as exchange of information and cooperation in legal matters. Other areas of cooperation suggested include energy, trade, investment, finance, science, research and development, IT, transport, infrastructure, healthcare, human resource development, tourism and culture. The pact calls for an ASEAN-India free trade area by 2011 with five richer members of the region and by 2016 for the other five. The agreement stated that the aim was to "achieve freer movement of goods, services, investment and cooperation in other economic areas."
The agreement also says that India and ASEAN nations must cooperate closely on reforming and democratizing the UN and other world bodies and make them reflective of contemporary realities. India received support for a place in the expanded UN Security Council from Laos when Prime Minister Manmohan Singh had a bilateral meeting with Laos Prime Minister, Bounnhang Vorachith.
India-ASEAN bilateral trade has been growing and presently stands at $13 billion annually. But immense untapped potential exists and two way trade is expected to register an almost 200 per cent increase by 2007. An analysis carried out by India Defence Consultants (IDC) indicates that after the signing of the India-ASEAN pact in Vientiane the bilateral trade might reach to $30 billion by 2007.
New Delhi's "Look East" policy is now getting noticed and resulting in tangible gains for the country's business and industry. The ASEAN business leaders started recognising India's potential as a good and promising partner at the Bali summit last year and now view it as a country with which they can both benefit from and share developmental experiences. The Vientiane summit is expected to significantly boost trade and investment between India and ASEAN. The summit was also important for encouraging endorsement of India. Moreover, the long-term partnership agreement of India with ASEAN countries would provide a new dimension to its relations with the powerful ten-nation grouping.