NEW DELHI, 23 August 2007 — India and Japan vowed yesterday to seal an economic partnership deal by December as Prime Minister Shinzo Abe urged New Delhi to join Tokyo in the creation of an Asian “arc of freedom.” Abe laid out his vision for a new four-way “arc of freedom and prosperity” bringing together Australia, India, Japan and the United States.
With China rising, Japan is pushing ahead with a strategic partnership in India and other nations, but New Delhi — not keen to upset key trade partner Beijing — has said the initiative should not be seen as a “zero-sum game.”
“A new broader Asia that broke away from geographical boundaries is now beginning to take on a distinct form,” said Abe, who arrived in India on Tuesday, accompanied by 200 top Japanese executives.
“By Japan and India coming together in this way, this ‘broader Asia’ will evolve into an immense network spanning the entirety of the Pacific Ocean incorporating the United States of America and Australia,” he said in a speech to a special session of the Indian Parliament.
“Open and transparent, this network will allow people, goods, capital and knowledge to flow freely,” said the prime minister, ahead of summit talks with Indian Prime Minister Manmohan Singh yesterday.
Abe also called for early conclusion of a “high quality economic partnership” with India and forecast a more than doubling of trade between the two nations to $20 billion in three years from eight billion currently.
Earlier, top Japanese and Indian commerce officials pledged to tie up the partnership pact by year-end.
India’s Commerce Minister Kamal Nath told business leaders from both nations that the focus of economic activity had shifted from west to east.
“India and Japan need to jointly meet the challenges of the new economic architecture,” Nath said, adding he would work to ensure “this agreement by the end of the year.” Japanese officials welcomed his remarks, adding they hoped to further Japanese investment in India, which currently stands at $520 million, as a result of Abe’s trip.
Abe and Singh were to discuss a number of investment projects.
They include a $100 billion industrial corridor and freight link from the capital to the Arabian sea port of Mumbai, India’s financial hub, with funding estimated at an unconfirmed $30 billion.
“The two leaders will reach further agreement this evening on how to further develop this project,” said Masakazu Toyoda, a Japanese vice minister for economy and trade.
Japanese business officials hinted at announcements on investment later, saying Japanese industries were looking to India not just for its huge domestic market, but as a future manufacturing and export base.
Agreements on political, security and defense cooperation were also expected, a Japanese foreign ministry official said, asking not to be named.
For its part, New Delhi is actively wooing Japanese investment in Indian infrastructure, with an estimated $320 billion needed over the next five years if India is to keep up its nine percent growth rate.
