The Korea Herald


[Jagannath Panda] New Southern Policy vis-a-vis Asia’s relationship balance

By Korea Herald

Published : July 9, 2018 - 17:31

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A highlight currently in Asia’s politics is the balance of relationship characters. Such balance has two extreme shades, namely, conflict and cooperation. The countries involved may have a range of intersecting issues; but their cooperative mechanisms are equally strong. If Moon Jae-In’s “New Southern Policy” is to succeed, South Korea needs to overcome the obstacles of this balance of relationships to strengthen its outreach in Asia.

Moon’s trips to India from Sunday to Wednesday and to Singapore from Wednesday to Friday this week are targeted at strengthening South Korea’s economic ties with India and the Association of Southeast Asian Nations. The NSP’s hallmark is to diversify and expand South Korea’s economic and diplomatic contacts in order to reduce South Korea’s strategic dependence on China and the US in the longer run. The NSP is also intended to provide an alternative choice of international cooperation for South Korea’s international contacts in Asia, without making it too obvious, to move away from China and the US. Further, the “newness” of this outreach is how Seoul has carefully orchestrated an Indo-Pacific policy without making it apparent.

ASEAN has emerged as South Korea’s second-largest trading partner. ASEAN is also the center of many economic powers’ foreign policies, including China and Japan. South Korea’s engagements, investments and economic dealings have to overcome especially the challenges that the Chinese and Japanese governments pose in the ASEAN region.

A high point of China’s Belt and Road Initiative “yi tai, yi lu” project is to invest in connectivity, corridors and infrastructural investment in the immediate neighborhood regions, including ASEAN. The OBOR is a six C’s strategy: connectivity, corridors, cooperative packages to neighbors, co-funding multilateral projects, country-specific outreach and continental outreach. Some of these features are clearly visible in the ASEAN context, enhancing China’s outreach in the region. Beijing’s Maritime Silk Road under OBOR especially factors ASEAN into the Chinese foreign policy outreach.

Xi Jinping announced the MSR initiative in the Indonesian Parliament in October 2013, which explains the seriousness China holds toward the ASEAN region. In the post-Permanent Court of Arbitration ruling on South China Sea dated July 12, 2016, China’s influence in the ASEAN region has grown markedly, as Beijing has been successful in creating a fissure among countries in the region on the South China Sea, dividing the ASEAN spirit.

Japan is one country that is trying to match the Chinese economic prominence in the ASEAN region. Prime Minister Shinzo Abe’s flagship Expanded Partnership for Quality Infrastructure and the Free and Open Indo-Pacific strongly board ASEAN as a destination for outreach. Japanese companies, development agencies and multinational banks are constantly searching for avenues of new market overseas and in the ASEAN region, which has been one of the main arches for Japan’s foreign policy.

Japan’s infrastructure investment in Vietnam and the Philippines remains the most impressive aspect of its outreach to the region. With the ASEAN-Japan Comprehensive Economic Partnership agreement, which came into force in 2008, a prime aspect of Japan’s economic engagement is how to grow its cooperative presence in the ASEAN region. ASEAN’s forte of the growth engine at present is infrastructural development, which Japan successfully capitalizes on. Since 2000, Japan has invested almost $230 billion in infrastructural development in the ASEAN region, whereas China’s investment package figures at around $155 billion.

Moon Jae-In’s New Southern Policy, on its India factor, will face a test from both Japan and China too. But the moot point is: How far will the India-Korea partnership succeed with India-Japan and India-China relations as they are? India’s Act East policy positions both Japan and China as strong economic partners. India’s relationship with China may be based on a “conflict-cooperation” scenario. But the most stabilizing factors in the India-China relationship are the growing economic contacts.

Despite the Doklam border standoff between India and China, their bilateral trade contacts witnessed a substantial surge in 2017, touching $84.44 billion compared to $71.18 billion in 2016.

India is also increasingly looking at Chinese investments to boost employment opportunities in India, address trade imbalance and address the infrastructural need India is deficient of. Modi’s Make in India, Shreshtha Bharat (Great India) and Clean India campaigns would like to seek Chinese investments to carry out fast-track infrastructural development. This will emerge as a challenge to South Korea’s investment and presence in India.

The Wuhan informal meeting between Narendra Modi and Xi Jinping seems to have reframed India-China relations into a developmental mode. It therefore needs to be seen how Moon Jae-In’s NSP will prioritize further cooperation with India.

India-Japan “special” relations will also certainly emerge as a credible link that Seoul should not overlook. Japan has emerged as a strong investor in infrastructure across India. The regional cooperation between the two countries is yet to take off, but their bilateral relations are much stronger currently than any of India’s external relationships.

With an emphasis on “partnership for prosperity,” cooperation in the field of high-speed railway projects, energy, smart cities, biotechnology, health, pharmaceuticals, information and communications technology, science and technology is gradually moving in an upward direction in India-Japan bilateral cooperation.

Japan’s official development assistance to India remains the most promising and assuring aspect of their cooperative partnerships in the socio-economic developmental sectors, particularly in building key infrastructure projects. India is emerging by far as the highest recipient of Japanese loans as a single country in a financial year.

Besides, India and Japan are establishing a foreign policy convergence in the broader Indo-Pacific region, which remains the highlighting aspect of their “Special and Global Partnership.” Their common pledge for a “free, open and prosperous Indo-Pacific” region brings them closer both bilaterally and regionally. This growing character in India-Japan relations will undoubtedly pose a test for India-South Korea relations to flourish.

Moon’s visits to India and Singapore offer a range of possibilities for Seoul’s NSP. But the challenge is whether the policy is able to cope with Asia’s relationships of complexity. The most important fault line of Moon’s NSP is the bilateral mode of contacts it aims to establish both with ASEAN and India separately. Even though the New Southern Policy has yet to endorse the concept of Indo-Pacific; it is entering into the Indo-Pacific region without having a regional vision on how to position Seoul’s strategic interests in the region.

The test for Moon Jae-In’s NSP would be whether ASEAN move its contacts with South Korea forward along with Japan and China and also whether India can position South Korea as a partner while progressing with India’s relationship with these two countries. Simply relying on a bilateral mode of contacts with ASEAN and India will not serve South Korea’s purpose. Moon Jae-In’s New Southern Policy needs to balance out the relationship configuration in Asia if it is to succeed. 

Jagannath Panda
Jagannath Panda is fellow and center head for East Asia at the Institute for Defense Studies and Analyses in New Delhi. This piece is based on the author’s speech at the “New Southern Policy and the Future of Korea-India Cooperation” conference on July 3 and “Korea’s New Southern Policy: Visions, Strategies, and Ways Forward” conference on July 3-4 in Seoul. -- Ed.