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Modi’s Malaysia visit: Strengthening Bilateral Ties and Giving Fillip to his ‘Act East’ Drive
Siddharth Singh
2015-11-15
Region : Asia, SouthEastAsia, Malaysia, India,
Issue : Security,
India and Malaysia have traditionally been close and friendly. India and Malaysia are also connected by various cultural and historical ties that date back to antiquity. The two countries are on excellently friendly terms with each other seeing as Malaysia is home to a strong concentration of Indian immigrants. On trade front their bilateral trade volume stands at $10.5 billion and is poised to reach $25 billion by 2020.
Malaysia is an important country for India in its new “Act East Policy”. ‘Act East’ is supposed to be build on “Look East policy”, the foreign policy stance which India had adopted in the 1990s when it opened up its economy to the world. In his eastward focus, PM Modi is trying to inject more dynamism into India’s ties with South-East and East Asian Nations. His aim is to signal a new and more action-oriented policy towards the Association of South-East Asian Nations (ASEAN) in particular and East Asia in general. With India unveiling its plans through schemes like Make in India, Smart Cities, Modernisation of Indian Railways etc and to modernize its infrastructure as well as to speed up the overall economic growth and to boost manufacturing, countries like Malaysia is uniquely placed to help India because Malaysia has both the resources and the expertise that India is looking for in these very areas.
There have been regular Summit level exchanges and meetings, the most recent of which were the visits by the Prime Minister Narendra Modi to Malaysia from 20th to 23rd November 2015 where Prime Minister attended the ASEAN-India summit and East Asia summit as well as he also held bilateral talks with his Malaysian counterpart. There has been a change in the Malaysian perception about India also since PM Najib took over in Malaysia. He was the first of Malaysia’s six prime ministers to visit India within the first year of taking office.
During the PM Modi’s visit, India and Malaysia have reviewed their bilateral relations in many aspects during this visit, including their political, economic and defence ties. Terrorism, human trafficking, maritime safety and trade were the main focus of Prime Minister Narendra Modi's three-day visit to Malaysia. Both the countries reaffirmed their commitment to further strengthen bilateral trade and investment cooperation, and to deepen and widen their economic engagement, which has emerged as an important fulcrum of the strategic partnership. Both the countries also pledged to strengthen cooperation in trade and security during talks between Indian Prime Minister Narendra Modi and his Malaysian counterpart Najib Razak. An improvement in political ties has prompted many Indian companies to move into Malaysia in a big way, using it as a base to establish a presence in other ASEAN countries.
As far as Malaysia is concerned, there are approximately 30 million people in Malaysia out of which approximately two million persons are of Indian origin constituting nearly eight per cent of Malaysia’s population. It is the second largest Persons of Indian Origin community abroad after the United States.
India’s trade with Malaysia in 2014 was about USD 14 billion. India import about USD 9.7 from Malaysia which are essentially commodities and imports of mineral, fuels, vegetable oils and fruit products, etc. Malaysia has invested more than USD 7 billion in India and it has also completed another USD 6 billion worth of projects in India particularly in the infrastructure and construction sector with the focus on roads and highways, and also upgradation of airports and ports.
India’s investments in Malaysia are also substantial, around USD 2.3 billion. Major Indian companies like IRCON, Reliance, Kirloskar, Bajaj, TCS, Mahindra, L&T, Wipro etc. are present in Malaysia and are operating in the sectors like textiles, chemicals, machinery and equipment, non-metallic mineral products etc.
India’s ties were upgraded to a strategic partnership in October, 2010 during the visit of the then Indian Prime Minister Dr. Manmohan Singh to Malaysia. As far as the Act East Policy is concerned and Malaysia’s own economic development is concerned, the bilateral relationship is poised to jump to the next level. While economic and commercial engagement has increased, there is also scope for improvement in security cooperation and defence cooperation etc. Health and education sectors have also potential which have largely remained untapped.
The defence cooperation between the two countries will further reinforce the ties in a spiralling manner because of the specific cooperation in the advancing maritime security and strengthening disaster response in the region. The two nations have also agreed upon to upgrade the joint exercises HARIMAU SHAKTI and set up the SU-30 forum for cooperation in training, maintenance, and technical support of the fighter jets because India is one of the largest operators of SU-30 jets in the world and its air force has trained Malaysian pilots in the past also. India and Malaysia have also agreed to institute annual talks between the Heads of the Indian Coast Guards and the Malaysian Maritime Enforcement Agency which is very important development in the context of terror attacks like 26/11 which happened in Mumbai. Besides boosting military ties, India and Malaysia also signed a memorandum of understanding to cooperate in cyber security. A MoU on cyber security between Computer Emergency Response Team-India (CERT-IN) and Cyber Security of Malaysia was signed in this regard. Another important MoU was signed on the cultural exchange programme between the Ministry of Culture of India and Ministry of Tourism and Culture of Malaysia. In his visit, PM Modi also emphasised on co-operation as well as enhanced Malaysian participation in projects like ‘Make in India’ and ‘Smart city’ initiatives. In this regard, a MoU was signed between NITI Aayog and Performance Management Delivery Unit (PEMANDU) to ensure excellent cooperation in Public Administration and Governance. PEMANDU is the governance institution in the Prime Minister’s office in Malaysia. PM Modi personally interacted with PEMANDU officials, and said that its cooperation and consultation with NITI Aayog can bring fruitful changes in India in the policy making. PM Modi also inaugurated the Torana Gate and said, “It will be a symbol of our timeless ties and the friendship between our people.”
In the joint statement, it was highlighted that there is an urgent need to promote joint collaboration, especially in infrastructure and construction sectors, and to facilitate joint projects and collaboration between the private sectors of the two countries, in line with the new developmental and business initiatives undertaken by India, such as the Make in India, Digital India, Smart Cities and Skill Development that offered significant investment opportunities for Malaysian businesses. In this regard, while addressing the business community in Malaysia, PM Modi conveyed the steps being taken by the Government of India to provide a conducive environment for investors, and PM also invited Malaysian investors to participate in economic activities for the mutual benefits of both countries.
Prime Minister Narendra Modi also made a very important announcement at Kuala Lumpur that the Indian Cultural Centre (Kuala Lumpur) will be named after freedom fighter and commander of the Indian National Army, Netaji Subhas Chandra Bose. This is the first time that an Indian prime minister has named the Indian Cultural Centre in a foreign country after Netaji, the "Hero of Asia".
The visit by PM Modi to Malaysia has certainly given a fresh and much needed impetus to the bilateral relationship. It will be very interesting to see how the agreements and promises that have been made during the visit will be shaped. Malaysia certainly is a place where India has a lot of strategic stake including the Indian community. The economic cooperation will certainly guide the relationship and will take it on a riding path in days to come.
Views expressed are of the author and do not necessarily reflect the views of FORE INDIA

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