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It is a truism from another era that navy follows trade. In the 21st Century, naval capabilities are crucial beyond just protecting mercantile interests to terrorism to peacekeeping. Probably nowhere else is this broader agenda more relevant than in Indian Ocean waters bordered by 38 Indian Ocean littoral states, a theatre frequently marked by political, social or economic instability.
India is strategically located in the Indian Ocean. Its vast coastline makes it vulnerable, but its commanding heights also underline its potential as a hub for regional and global security networks. The country's economic and political rise on the world stage combined with trans-continental developments has forced a rethink of its defence priorities on maritime security and 'strategic outreach'.
India had long neglected its maritime defence. Disputes to its north meant policymakers' focus on the army, not navy. Moreover, Indian sermons during NAM's heyday calling for an Indian Ocean Zone of Peace and against foreign sea-based presence in the region inevitably boxed India itself into naval 'underdevelopment'. Into the eighties, the navy was largely a flotilla of rust buckets, its capabilities overestimated by western intelligence (leading to injudicious protests against India acting as a Trojan (sea) horse for the Soviet Union).
Today, the Indian sea fleet is among the top ten navies in the world. An ambitious programme for upgrading maritime forces is under way with its share of the defence budget rising to around 20 percent (US$5 billion). According to Defence Minister Antony, the objective is not only to enhance the Navy's fighting capabilities but also to develop the force into a "powerful instrument of state policy" during peacetime. India's paramount aims are coastal and island territories' defence, commercial and energy security, protection of offshore oil and gas infrastructure (which accounts for 30 percent of energy supplies), and to develop deep-water power projection capabilities.
The state-of-the-art integrated naval base on the western seaboard at Karwar, the largest this side of Suez, is slated for Phase II of development. In something of an irony, purchased Russian aircraft carrier, Admiral Gorshkov, and the American amphibious assault ship, Trenton, will lead the fleet later this year. Six submarines are in production. 32 vessels are under construction, including an indigenously designed aircraft carrier, guided missile frigates, destroyers, corvettes, patrol boats, landing ships and fast attack craft. A large share of the US$40-50 billion earmarked for arms over the next 10 years is expected to be allocated to naval forces for material imports from the US, Russia, Western Europe and Israel.
The major geo-strategic factor promoting India's blue water status is the "strategic partnership" with the US, underwritten by the 2005 "New Framework for the Defence Relationship". The partnership is driven by strategic convergences, including protection of sea lanes; maritime terrorism; human trafficking; drug smuggling, small arms' trade; strategic missile defence; Container, Proliferation and the 'Thousand-ship Navy' security initiatives. America also needs inter-operability and logistic support for its operations from Afghanistan to Malacca straits.
The US (and its regional allies) is also conscious of India's naval capabilities for undertaking 'outsourced' high-seas patrolling, humanitarian relief, protection of sensitive shipping and peacekeeping. These were evident in the post-tsunami relief and rescue mission stretching from Sri Lanka to Aceh, and in evacuating thousands during the Israel-Lebanon conflict last year.
India's blue water reach is reflected in the recent, unprecedented programme of fleet exercises and visits throughout Asia. Joint patrolling with Indonesia, Thailand, Singapore and Vietnam is on the cards following India's call for "workable alliances with like-minded countries". Scheduled exercises with France, the UK and Oman will focus on West Asia waters, particularly the choke points of the Straits of Hormuz and Bab-el-Mandel through which most of the world's oil supply passes.
However, most importantly, and confirming that it has graduated from being a seeker of international maritime security to providing it, India will participate in its biggest naval exercise with Australia, the US, Japan and Singapore in the Bay of Bengal in September.
The Manila agreement to hold this exercise also brought into relief the ambivalent Sino-Indian relationship. China delivered a demarche to the four governments asking the purpose of the meeting. Its concerns centered on the possibility of India joining the so-called concert of democracies in a quadrilateral naval arrangement against it. It is all too well aware of the Bush Administration's stated policy to "help" India become a "great power". In May, Rice and Abe declared a "common strategic objective" to build upon partnerships with India because it was "inextricably tied to the prosperity, freedom and security of the region".
Participants are downplaying the significance of the exercise. Indeed, its location in the Bay of Bengal is intended to maintain a distance from the arc of the Pacific Ocean to placate Russian and Chinese sensitivities. India has denied suggestions that these exercises presage a security grouping "against anyone & the Indian navy is driven not by being US, China or Pakistan-centric". Meanwhile, Defence Minister Nelson has rejected the possibility of expanding the trilateral security dialogue with Japan and the US to include India because it would "complicate" the current security architecture.
WATCHPOINT: Australia's dilemma: Balancing its coincidence of interests with India's growing economic and naval reach into South East Asia (particularly the northeast Indian Ocean) with the sensitivities of its largest trading partner, China, which is increasingly wary of Australia's closer security relations with the
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AFG Venture Group is an Asia and Australia based corporate advisory and consulting firm with over 20 years experience in creating alliances, relationships and transactions in Australia, South East Asia and India; including a 15 year history of corporate and equities advisory in Australia, undertaking merger, acquisition, divestment, fund raising and consulting for private and public companies.
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