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28 March 2019, Gateway House

An ASEAN trio in transition

Philippines, Cambodia and Lao PDR face a range of development challenges at home even as they respond dynamically to shifting priorities in external relations. With U.S.-China competition increasingly shaping this part of the world, will India provide some balance? An insider’s account of how three less noticed ASEAN countries are coping with geopolitical changes

Distinguished Fellow, Foreign Policy Studies

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This is the author’s sixth article in our special series on the ASEAN

An eight-day visit earlier in March to Manila, Vientiane and Phnom Penh, the capitals of three ASEAN member states considered to be close to China,[1] proved to be an invaluable opportunity to deepen and diversify one’s perceptions about these countries’ individual development challenges and their approach to the region’s power play. Detailed discussions with policymakers, think tanks, civil society, media, business and the Indian diaspora confirmed that the situation on the ground is far more complex and granular than it may look from New Delhi.

The Philippines

The Philippines merited the most attention, partly due to the relative ignorance in South Asia about its policies and underlying motivations, and partly because it is located on the front lines of the U.S.-China strategic competition that shapes the region today.[2] Two contrary views prevail in Manila, namely, the official one and that of the Opposition. The government of President Rodrigo Duterte has been actively pursuing a policy of accommodation and conciliation with China, downplaying differences on the South China Sea dispute, coveting funds for infrastructure development under the Belt and Road Initiative (BRI), and countering the Manila elite’s traditional pro-U.S. tendency.

However, nearly three years into Duterte’s tenure, such a strategy of pursuit and transaction has produced less than satisfactory results. Of the $24 billion promised by the Chinese government for 26 projects under the BRI, only one project has received a mere $140 million. Manila’s infrastructure appeared to be crumbling. U.S. Secretary of State Mike Pompeo’s recent visit gave the opposition (both within and outside the government) a boost as it is advocating a closer and more cooperative equation with Washington. Negotiations for a review of the U.S.-Philippines Mutual Defence Treaty (MDT) are in the offing even as the Philippines government juggles its priorities: amending the MDT while also strengthening ties with Beijing.[3] Meanwhile, the pro-U.S. constituency in the military, opposition parties, academia and business has been pushing back on Duterte’s pro-China line.

The schism between those upholding the official view and those critical of it came through sharply on fundamental issues, such as the role of the ASEAN. The official view was that ASEAN still has centrality and relevance.  Others, however, questioned this in view of the grouping’s internal differences on: the Indo-Pacific; a binding Code of Conduct with China for the South China Sea; and the desirability or otherwise of the Quad (linking the U.S., Japan, India and Australia).

The point on which the conflicting viewpoints converged was in welcoming the growing economic and political cooperation between Japan and the Philippines and emphasising that India’s Philippines relationship has much untapped potential. “India is a powerhouse, but a sleeping giant,” observed a respected former foreign minister cryptically.

Cambodia

Cambodia’s centuries-old past bears witness to the triumph of India’s Hindu-Buddhist imprint over Sinic influences. But the Cambodia of today is deeply allied to China, with political and economic links becoming progressively closer in recent years. It is, in effect, a one-party authoritarian regime where public resentment is on the increase.[4] Talk in political circles is about dynastic succession as Prime Minister Hun Sen’s children are groomed to become future leaders.

A deep strategic convergence between the regime and the Chinese government has led to predictable outcomes: China-aided infrastructure projects are booming; bilateral trade touched $6 billion in 2018; and 2.2 million Chinese tourists visited Cambodia last year. China is reportedly involved in constructing a naval base in the Koh Kong province along the Gulf of Thailand, but officials denied this, asserting that a foreign base was “contrary to our constitution”.

On the other hand, informed sources acknowledge that, within the past three years, Chinese investment in casinos, condos and malls has turned the sleepy beach town of Sihanoukville into an enclave that looks more Chinese than Cambodian now.[5] Nagaworld, a glitzy hotel in downtown Phnom Penh, also symbolises the China connection; it is a magnet for hordes of Chinese, frequenting its casinos, bars and duty-free shops.

Foreign policy specialists in the capital felt that ASEAN needed to introspect and reform its policy of non-interference in members’ internal affairs and the decision-making process. Some of them were even more vocal about links with China. The Chinese dismiss the Quad on the face of it, but they are anxious about it. Others said that there was considerable concern in Cambodia over deepening U.S.- China rivalry. The hope was that that India serves as “the balancing power” between the two giants to prevent an overwhelming Chinese influence in the region.

Lao PDR

Landlocked Laos’ strategy is to become a land-linked country and its aim is to woo all its neighbours.[6] It has shown dexterity in balancing relations with China, Thailand and Vietnam. Close economic relations with Thailand coexist with a receptive policy on the BRI. ‘We need Chinese funds for our infrastructure development’ was the refrain. The experts spoken to also mentioned the unease over lingering border disputes between China and Vietnam and the illegal immigration into Laos from these two countries.

Discussion on India-Laos relations showed the potential for expansion for trade, investment and tourism, besides training, capacity-building and cultural cooperation.

In sum, the lesser known regions of ASEAN deserve greater attention by India than accorded so far. New Delhi is engaged in multiple, albeit low-key, initiatives to strengthen political and economic cooperation with these countries. This, however, is not enough. Economic content in these relationships must be expanded. India Inc needs to step forward to play a bigger role. Investment opportunities in, for example,  infrastructure  development, pharmaceuticals, IT and automobile sectors in the Philippines and aggressive promotion of civil aviation links and tourism market linkages in all three countries, should be a priority. Above all, India’s strategic community and academia can become more alert to the incredible intellectual capital and goodwill towards India which these countries harbour. Energetic outreach,  regular dialogue and joint research projects are some of the ways in which this asset can be tapped.

Rajiv Bhatia is Distinguished Fellow, Foreign Policy Studies, Gateway House. A former Ambassador  to Myanmar and several other countries, he is a reputed strategic analyst and writes regularly on Indo-Pacific affairs.

This is the author’s sixth article in our special series on the ASEAN

This article was exclusively written for Gateway House: Indian Council on Global Relations. You can read more exclusive content here.

For interview requests with the author, or for permission to republish, please contact outreach@gatewayhouse.in.

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References

[1] I was on a five-person foreign policy immersion tour, sponsored by the Kalinga International Foundation (KIF) and led by its chairman and former foreign secretary, Ambassador Lalit Mansingh. I was representing Gateway House.

[2] Bhatia, Rajiv, “Democracy and other Challenges in the Philippines”,  https://www.gatewayhouse.in/democracy-and-other-challenges-in-the-philippines/

[3] Sakhuja, Vijay, ‘U.S.-Philippines Mutual Defence Treaty: Dilemmas of “maintain it, strengthen it, or scrap it”’ http://www.kalingainternational.com/Vijay-Sakhuja7.html

[4] Bhatia, Rajiv, “Power politics in Cambodia’, https://www.gatewayhouse.in/power-politics-cambodia/

[5] Ellis-Petersen, Hannah, ‘No Cambodia left: how Chinese money is changing Sihanoukville’, https://www.theguardian.com/cities/2018/jul/31/no-cambodia-left-chinese-money-changing-sihanoukville

[6] Rajiv Bhatia, “Laos: balancing Asian powers”, https://www.gatewayhouse.in/laos-balancing-asia/

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