Given that the balance of power in Asia will be determined by events as much in the Indian Ocean rim as in East Asia, India and Japan have to work together to promote peace and stability.

The visit of the new Japanese Prime Minister, Yukio Hatoyama, is part of Japan’s growing economic and strategic engagement with India. Japan and India indeed are natural allies because they have no conflict of strategic interest and actually share common goals to build stability, power equilibrium and institutionalised multilateral cooperation in Asia. There is neither any negative historical legacy nor a single outstanding political issue between them. If anything, each country enjoys a high positive rating with the public in the other state.

Mr. Hatoyama’s year-end visit, fulfilling a bilateral commitment to hold an annual summit meeting, shows he is keen to maintain the priority on closer engagement with India that was set in motion by his predecessors, Junichiro Koizumi, Shinzo Abe and Taro Aso of the Liberal Democratic Party (LDP), now in the opposition. Mr. Hatoyama came to office vowing to reorient Japanese foreign policy and seek an “equal” relationship with the United States. But he and his Democratic Party of Japan (DPJ) had said little on India.

Today, just when America’s Sino-centric Asia policy has became unmistakable, Mr. Hatoyama’s government has put Washington on notice that Japan cannot indefinitely remain a faithful servant of U.S. policies. With Tokyo seeking to rework a 2006 basing deal with the U.S., besides announcing an end to the eight-year-old Indian Ocean refuelling mission in support of the U.S.-led war in Afghanistan, Japan no longer can be regarded as a constant in America’s Asia policy. This has been further highlighted by Mr. Hatoyama’s re-examination of a secret agreement between the LDP and the U.S. over a subject that is highly sensitive in the only country to fall victim to nuclear attack — the storage or trans-shipment of U.S. nuclear weapons in Japan.

Against this background, New Delhi must be pleased that Mr. Hatoyama’s visit signals continuity in Tokyo’s India policy. It also shows that at a time when Asia is in transition, with the spectre of power disequilibrium looming large, Tokyo wishes to invest in closer economic and strategic bonds with India.

As Asia’s first modern economic success story, Japan has always inspired other Asian states. Now, with the emergence of new economic tigers and the ascent of China and India, Asia is collectively bouncing back from nearly two centuries of historical decline.

The most far-reaching but least-noticed development in Asia in the new century has been Japan’s political resurgence — a trend set in motion by Mr. Koizumi and expected to be accelerated by Mr. Hatoyama’s efforts to realign the relationship with the U.S. With Japanese pride and assertiveness rising, the nationalist impulse has become conspicuous at a time when China is headed to overtake Japan as the world’s second largest economy by the end of next year.

Long used to practising passive, cheque-book diplomacy, Tokyo now seems intent on influencing Asia’s power balance. A series of subtle moves has signalled Japan’s aim to break out of its post-war pacifist cocoon. One sign is the emphasis on defence modernisation. Japan’s navy, except in the nuclear sphere, is already the most sophisticated and powerful in Asia. China’s rise has prompted Japan to strengthen its military alliance with the U.S. But in the long run, Japan is likely to move to a more independent security posture.

Although the two demographic titans, China and India, loom large in popular perceptions on where Asia is headed economically, the much-smaller Japan is likely to remain a global economic powerhouse for the foreseeable future. Given the size of Japan’s economy — its GDP was just under $5 trillion in 2008 — annual Japanese growth of just 2 per cent translates into about $100 billion a year in additional output, or nearly the entire annual GDP of small economies like Singapore and the Philippines. Still, given China’s rapid economic strides, Japan has been readying itself for the day when it is eclipsed economically by its neighbour.

Leading-edge technologies and a commitment to craftsmanship are expected to power Japan’s future prosperity, just as they did its past growth. Its competitive edge, however, is threatened by the economic and social implications of a declining birth-rate and ageing population. With a fertility rate of just 1.37 babies per woman in 2008 — America’s is 2.12 — Japanese deaths have started surpassing births in recent years. Permitting immigration on a large scale is no easy task for the Japanese homogenised society. But just as Japan has come to live with the discomforting fact that today’s top sumo wrestlers are not Japanese, it will have to open its research institutions and factories to foreigners in order to raise productivity.

India and Japan, although dissimilar economically, have a lot in common politically. They are Asia’s largest democracies, but with messy politics and endemic scandals. Mr. Hatoyama, in office for just three months, has already come under pressure following the indictment of two former secretaries over a funding scandal. In both Japan and India, the Prime Minister is not the most powerful politician in his own party. Fractured politics in both countries crimps their ability to think and act long term. Yet, just as India has progressed from doctrinaire nonalignment to geopolitical pragmatism, Japan — the “Land of the Rising Sun” — is moving toward greater realism in its economic and foreign policies.

Their growing congruence of strategic interests led to the 2008 Japan-India security agreement, a significant milestone in building Asian power stability. A constellation of Asian states linked by strategic cooperation and sharing common interests is becoming critical to ensuring equilibrium at a time when major shifts in economic and political power are accentuating Asia’s security challenges. After all, not only is Asia becoming the pivot of global geopolitical change, but Asian challenges are also playing into international strategic challenges.

The Indo-Japanese security agreement, signed when Prime Minister Manmohan Singh visited Tokyo in October 2008, was modelled on the March 2007 Australia-Japan defence accord. Now the Indo-Japanese security agreement has spawned a similar Indo-Australian accord, signed when Australian Prime Minister Kevin Rudd came to New Delhi last month. As a result, the structure and even large parts of the content of the three security agreements — between Japan and Australia, India and Japan, and India and Australia — are alike.

Actually, all three are in the form of a joint declaration on security cooperation. And all of them, while recognising a common commitment to democracy, freedom, human rights and the rule of law, obligate their signatories to work together to build not just bilateral defence cooperation, but also security in Asia. They are designed as agreements to enhance mutual security between equals. By contrast, the U.S.-India defence agreement, with its emphasis on arms sales, force interoperability and intelligence sharing — elements not found is Australia-Japan, India-Japan and India-Australia accords — is aimed more at undergirding U.S. interests.

The key point is that the path has been opened to adding strategic content to the Indo-Japanese relationship, underscored by the growing number of bilateral visits by top defence and military officials. As part of their “strategic and global partnership,” India and Japan are working on joint initiatives on maritime security, counterterrorism, counter-proliferation, disaster prevention and management, and energy security. But they need to go much further.

India and Japan, for example, must co-develop defence systems. India and Japan have missile-defence cooperation with Israel and the U.S., respectively. There is no reason why they should not work together on missile defence and on other technologies for mutual defence. There is no ban on weapon exports in Japan’s U.S.-imposed Constitution, only a long-standing Cabinet decision. That ban has been loosened, with Tokyo in recent years inserting elasticity to export weapons for peacekeeping operations, counterterrorism and anti-piracy. The original Cabinet decision, in any event, relates to weapons, not technologies.

As two legitimate aspirants to new permanent seats at the U.N. Security Council, India and Japan should work together to persuade existing veto holders to allow the Council’s long-pending reform. They must try to convince China in particular that Asian peace and stability would be better served if all three major powers in Asia are in the Council as permanent members. Never before have China, Japan and India all been strong at the same time. Today, they need to find ways to reconcile their interests in Asia so that they can coexist peacefully and prosper.

(Brahma Chellaney is professor of strategic studies at the Centre for Policy Research in New Delhi and the author of Asian Juggernaut: The Rise of China, India and Japan, with a new U.S. edition scheduled for release in March.)

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