India’s Act East Policy | Boosting Regional Connectivity

The Ministry of Ports, Shipping and Waterways has flagged off the first batch of trial Cargo Vessels from Maia Inland Custom Port in West Bengal to Sultanganj Port in Bangladesh, marking a significant step under India’s Act East Policy, with a focus on enhancing Inland Water Transport.

Key Highlights of the Act East Policy Initiative

• Operationalization of Maia Terminal is expected to be a game-changer as it would shift 2.6 million tonnes per annum (MTPA) of Bangladesh-bound export cargo from road to waterways.
• The Maia-Aricha route (Protocol Route 5 & 6) will reduce the distance from NW1 (National Waterways 1) to Bangladesh and the North Eastern Region by 930 kilometres.
• IWT refers to the transportation of goods and passengers via navigable rivers, canals, lakes, and other inland waterways.
• IWT is a highly cost-effective mode of transportation, particularly for bulk cargo like coal, iron ore, cement, food grains, and fertiliser.
• Despite its advantages, its current share in India’s modal mix is only 2%. The government aims to increase this share to 5% by 2030 under the Maritime India Vision (MIV)-2030.

The Significance of India’s Act East Policy

• The ‘Act East Policy’ announced in November, 2014 is the upgrade of the “Look East Policy”.
• India’s Act East Policy focusses on the extended neighbourhood in the Asia-Pacific region.
• The policy which was originally conceived as an economic initiative, has gained political, strategic and cultural dimensions including establishment of institutional mechanisms for dialogue and cooperation.
• Act East Policy has placed emphasis on India-ASEAN cooperation
• The North East of India has been a priority in our Act East Policy (AEP).
• Various plans at bilateral and regional levels include steady efforts to develop and strengthen connectivity of Northeast with the ASEAN region through trade, culture, people-to-people contacts and physical infrastructure (road, airport, telecommunication, power, etc.).

The 4C’s of the Act East Policy

Prime Minister Narendra Modi emphasized four key pillars for India’s Act East Policy:

1. Culture: Promoting cultural exchanges and mutual understanding between India and its neighbors.
2. Commerce: Fostering economic collaboration and enhancing trade ties with the Asia-Pacific region.
3. Connectivity: Improving physical, digital, and logistical connectivity between India and ASEAN nations.
4. Capacity Building: Strengthening institutional mechanisms and sharing resources to enhance the capacities of regional partners.

From Look East to Act East:

• The focus of the “Look East Policy” was to increase economic integrationwith the South East Asian countries and the area was just confined to South East Asia only.
• On the other hand, the focus of the “Act East Policy” is economic and security integrationand the focus area increased to South East Asia as well as East Asia.
• When India launched the Look East policy in 1991, its own economic strength, its global status and the external environment were not what they are at present.
• At the time of its launch, India was struggling to transition from a state-controlled economic regime to a more liberalised one. It took many years for the country to get adjusted to the newly emerging economic environment.

The Historical Context of the Act East Policy

• In the post-Cold War period, there was a strong rationale for India to cultivate closer relations with the countries of the region for mutual benefit.
• The Gulf War of 1990-91 severely affected the Indian economy owing to an unprecedented rise in oil prices.
• It was further accentuated by the fall of the Soviet bloc on which the Indian economy heavily depended. India was therefore compelled to seek alternative regions for its economic sustenance.
• Unfortunately, its own immediate neighbourhood, South Asia, did not offer many opportunities for trade and investment.
• Political bickering and lack of trust, and the economic backwardness of the region compelled India to look to Southeast and East Asia for greener pastures.
• China, having embarked on a modernisation programme was then well on its way to becoming a major player in the Indo-Pacific region.
• Japan, the second biggest economy of the world at that time, had already established its footprints in the ASEAN region by setting up its manufacturing bases there.
• Realising that ASEAN and East Asia offered immense prospects for growth, India launched its Look East policy.
• While the initial motive was predominantly economic, Look East soon acquired strategic dimensions too

Key Initiatives to Enhance Connectivity under Act East Policy

• Agartala-Akhaura Rail Link between India and Bangladesh.
• Intermodal transport linkages and inland waterways through Bangladesh.
• Kaladan Multimodal Transit Transport Project and the Trilateral Highway Project connecting the North East with Myanmar and Thailand.
• Under India-Japan Act East Forum, projects such as Road and Bridges and modernization of Hydro-electric power projects have been undertaken.

Conclusion

India’s Act East Policy has been a cornerstone of the country’s foreign policy, strengthening ties with ASEAN nations and promoting regional stability and economic growth. The shift towards inland water transport and infrastructural development exemplifies India’s commitment to enhancing connectivity, trade, and cooperation with its neighbors. With ongoing efforts to improve maritime and inland waterway connectivity, India’s Act East Policy continues to play a pivotal role in shaping the future of the country’s economic and strategic engagement with the Asia-Pacific region.

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