Quad: The way ahead and the key challenges

The Quadrilateral Security Dialogue (QSD) consisting of India, Australia, Japan, and the US has been pitching in favor of a ‘Free and Fair Indo-Pacific’ ever since the first meeting between representatives of member states in November 2017.

Shinzo Abe, the current Prime Minister of Japan, actually proposed this arrangement about a decade ago. Diplomatic engagement began, and joint military exercises were even held, but a change in guard in Australia, as well as Chinese complaints to member states, resulted in the end of the arrangement. Given the increasing focus on the ‘Indo-Pacific’ region and the strengthening of strategic ties between all four countries, reticence was finally shed and representatives of the four countries met in November 2017, on the eve of the East Asia Summit in Manila. The main aim of the alliance, thus in other ways, has been to check China’s assertiveness, especially in the South China Sea, and democracy has been one of the key binding factors between the Quad. The U.S. State Department, after the meeting in November 2017, issued a statement that the United States is “committed to deepening cooperation, which rests on a foundation of shared democratic values and principles.”

More recently, the joint statement issued after the meeting between Trump and Australian Prime Minister Malcolm Turnbull in February 2018, reiterated the point about a Free and Open Indo-Pacific. Said the joint statement between both countries:

A free, open, and prosperous rules-based order in the Indo-Pacific region is in both our nations’ enduring national interests.

The Quad has also sought to deepen cooperation by building a counter-narrative to China’s OBOR (One Belt, One Road) through the exploration of similar, competing infrastructural projects.

Problems

Trump’s Insularity

While there is absolutely no doubt that there are clear strategic convergences between these four countries, and democracy may be a binding factor, the transactionalist approach of Trump, along with his insular economic policies, will have an impact on not just ties with India, but also Japan.

Some clear examples of this insularity include Trump’s decision to walk out of the TPP (Trans Pacific Partnership) agreement, of which Australia and Japan are members. The US President had repeatedly stated during his election campaign that the US would walk, given the fact, that the provisions of the agreement were unfair to the US. Immediately after signing an executive order to withdraw from the treaty, Trump stated:

Great thing for the American worker, what we just did.

In January 2018, on the eve of the World Economic Forum in Davos, Trump suggested that he was open to re-enter the agreement, provided the US got a better deal. Said the US President:

I would do TPP if we were able to make a substantially better deal. The deal was terrible, the way it was structured was terrible. If we did a substantially better deal, I would be open to TPP.

The agreement will now be signed on March 8, 2018 without the US.

Tariffs and Visas

Similarly, the US President had spoken about imposing tariffs on steel imports, which had great resonance in the ‘Rust Belt’ of the US during his election campaign. Victories in states like Iowa, Michigan and Wisconsin, especially in small towns and cities, played a key role in his triumph.

Trump is likely to keep his promise and the US will impose tariffs on aluminium (10 percent) and steel (25 percent) imports.

In a tweet, the US President said:

‘Our Steel and Aluminum industries (and many others) have been decimated by decades of unfair trade and bad policy with countries from around the world. We must not let our country, companies and workers be taken advantage of any longer. We want free, fair and SMART TRADE!’

Many Democrats from the Rust Belt actually welcomed Trump’s announcement, saying it would be immensely beneficial for the US economy. Countries (including some members of the Quad) criticized Trump’s move.

Japan, a member of the Quad, is the second largest exporter of aluminium to the US. Reacting to Trump’s announcement, Japanese Trade and Industry Minister Hiroshige Seko said:

I don’t think exports of steel and aluminum from Japan, which is a U.S. ally, damages U.S. national security in any way, and we would like to explain that to the U.S.

The Commerce Minister of Australia (another Quad member) said:

The imposition of a tariff like this will do nothing other than distort trade and ultimately, we believe, will lead to a loss of jobs.

It doesn’t end here, as Trump’s narrative on trade wars has also caused some discomfort in India. For instance, during a conversation with governors from various US states, the US President, in his nonchalant style, stated that India is not doing the US any “favour” by reducing customs duty on the imported motorcycles from high-end brands (Harley Davidson) to 50%.

Visas

Apart from the tariff concerns, the Trump Administration has introduced some new rules and regulations for issuing H1-B visas (including an increase in documentation, and making the extension of the visa tougher). As a result of increasingly stringent policies with regard to H1-B visas, there has already been a steep reduction in the number of Indian students opting for graduate programs in computer science and engineering.

It is not just the US that has adopted insular policies.

Australia too has abolished the equivalent of the H1-B Visa, dubbed Visa 457. This visa was used by 95,000 workers (with most of them being Indians).

While India may be having differences over visas, and economic issues, with the US and Australia, New Delhi’s relationship with Japan has strengthened.

Not only is Japan investing in India’s domestic infrastructure, but it is also facilitating key projects in India’s North East, which will in turn facilitate New Delhi’s Act East Policy, which seeks to bolster ties with South East Asia.

Both are working together in Japan’s Partnership for Quality Infrastructure (PQI) and both are also planning to work together in Africa and jointly develop the Asia-Africa growth corridor. In doing so both Japan and India are sending an unequivocal message.

Many analysts would argue that economic differences within member states do not matter, but being open and having robust economic relationships will be a necessary pre-condition for a stable partnership, and also for any serious connectivity projects.

While Quad has been speaking of a free and fair Indo-Pacific as an alternative to the Chinese narrative, Chinese President Xi Jinping has been pitching repeatedly for globalization. In his speech at Davos, Xi stated:

There’s no point in blaming economic globalization; it is simply not the case, and it will not solve the problems.

Having a more cogent vision for connectivity, along with being more open is essential for the Quad to move beyond just being.

Why India may need to be cautious

It would also be important to point out that while India may be going ahead with the Quad, some significant developments have taken place in the context of the bilateral relationship with China.

China was initially extending support to Pakistan, and trying to prevent it from being put on the greylist of the international watchdog Financial Action Task Force (FATF). Beijing, in lieu of support from India for Vice-Presidentship of FATF, agreed to withdraw its support for Pakistan. While the US was keen to support Japan, India agreed to support China since it withdrew its support for Islamabad.

It would also be important to note that India’s Foreign Secretary, Vijay Gokhale, before his visit to Beijing, also issued a note stating that government functionaries, as well as political leaders, should stay away from events planned to mark 60 years of Dalai Lama being in exile given the sensitivities involved (alluding to Chinese sensitivities). The government’s note received criticism from some quarters, and was projected as a weakness of the current government, which has so far taken pride in exhibiting a muscular policy but was nonetheless taken with an eye on reducing tensions.

During his China visit, the Indian Foreign Secretary held talks with the Chinese Vice Foreign Minister Kong Xuanyou, and also called on Foreign Minister Wang and State Councillor Yang Jiechi. A joint statement issued by both sides stated:

During the consultations, the two sides reviewed recent developments in bilateral relations, including high level exchanges, and discussed the agenda for bilateral engagement in the coming months […] Both sides agreed upon the need to expedite various dialogue mechanisms in order to promote multifaceted cooperation across diverse fields of India-China engagement.

Conclusion

The Quad will need to have a clearer vision for itself. It is important for members of the Quad not to be reactive. It is also important to exhibit openness, and ensure that all talk of a ‘Free and Open Indo-Pacific’ is more than just a mere slogan. India, Japan, and Australia can take the lead in infrastructural projects, while the US too needs to be more pro-active in pushing ahead the vision of connectivity. The Quad alliance needs to send out a message that “globalization” is not a bad word.

9 thoughts on “Quad: The way ahead and the key challenges

  1. […] allies like India are worried not just with regard to Trump’s insular economic policies (restrictions imposed on H1B visas being a major issue), but also his simplistic stand towards Iran, where India has invested in Chabahar Project, which […]

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