India and Japan’s ‘China paradox’

What role will India and Japan play in the Obama administration’s emerging Asia policy? I have just returned from visits to New Delhi and Tokyo organized by the estimable German Marshall Fund. The immediate picture one gets is of two Asian powers that seem to be trending in opposite directions, with India proudly ascendant and Japan struggling with apparent decline. Both nations are key to U.S. interests, yet both are also wrestling with new questions about their relationship with the United States. And in both countries, leaders voiced a common preoccupation — sometimes even obsession — with the 800-pound panda lurking in every boardroom and conference room: China.   

India and Japan both face a similar “China paradox”: China is, for each country, their single largest trading partner, yet is also seen by both as a potential long-term security threat (and many observers would drop the “potential” and “long-term” qualifiers). So India and Japan’s own economic futures are inseparably linked with China’s economic performance, even while their security concerns may also increase in tandem with China’s growing military assertiveness. It is a complex strategic challenge not unlike that faced by the United States in its own relationship with China.

The contrasts between India and Japan are just as striking. India’s elites across all sectors radiate pride at their nation’s rising power and are eager to embrace what they regard as their rightful prominent place on the global stage. They value their growing ties with the United States and retain considerable affection for former President Bush, who strategically elevated the U.S.-India relationship — a good reminder that the much-lamented decline in America’s global image during the Bush years does not include the world’s second most populous nation. Yet Indian policy leaders are also insecure, struggling to reconcile their tradition of isolation with their new aspirations for global leadership, mindful of their nation’s own manifest internal development challenges, and wary of what they perceive as the Obama administration’s tilt towards China at India’s expense.

We were in New Delhi the week of President Obama’s Afghanistan speech and heard an earful of worries from Indian policy leaders about the July 2011 drawdown date, which they interpreted as symbolizing U.S. disengagement from the region (it seems their Pakistani rivals had a similar reaction). In the reflective words of one Indian professional, India in its modern history “has never had either allies or partners,” and so is still learning how to develop partnerships with other nations. Too often its diplomatic default setting remains that of the fossilized Non-Aligned Movement, evidenced in part by India’s recent gestures towards Russia or its reluctance to help bring meaningful pressure on Iran’s nuclear program.

Japan in contrast remains unconfident, a nation long known for punching below its weight that is resigned to even further atrophy. Almost two decades of economic stagnation and demographic retrenchment have created an almost permanent “decline narrative” among Japanese elites that make it easy to forget that Japan is still the world’s second-largest economy (in nominal GDP). The wildcard is the new DPJ government led by the enigmatic Prime Minister Hatoyama, and the current preoccupation in Tokyo (even more than the diminishing stocks of bluefin tuna afflicting the sushi industry) is the puzzle of how the DPJ will actually govern. The DPJ’s economic program seems to be a less-than-coherent blend of labor-market reforms and cutting wasteful spending (the good) along with large new social welfare programs and increased capital market regulations (the not-so-good). Hatoyama also seems to be leading an existential review of Japan’s global identity and regional posture (with vague talk of a new “East Asian Community”) and a re-thinking of its alliance with the U.S. (with vague talk of an “equal relationship”). While in the short-term these moves, particularly the effort to renegotiate the Futenma base realignment agreement, are worrisome to the U.S., there are some threads of the DPJ’s program to revitalize Japan that might also lead it play a stronger global role and over time bring more capability to its alliance with the US.  

Curiously, in neither New Delhi or Tokyo was “Europe” mentioned very often at all — while a sign of Europe’s secondary stature in the region, this is perhaps also a reminder for European leaders that “China” is not synonymous with “Asia,” and an opportunity for them to forge closer ties with Japan and India at an important juncture.

For the Obama administration, India and Japan pose significant strategic opportunities, which can quickly become nettlesome challenges if not handled well. For India, the administration should designate a senior official (such as Deputy Secretary-level) to have lead responsibility for the U.S.-India relationship and help steer it in a positive direction after a rocky start this first year. For Japan, the administration would do well to follow Fred Hiatt’s suggestion of launching a high-level Strategic Dialogue modeled on the current SED with China. In both cases, the U.S. should eschew the “G-2” concept that needlessly elevates the U.S.-China relationship and antagonizes other allies and partners, and should remember that a responsible Asia policy will privilege relations based on common democratic values as well as common economic and political interests.

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