1 Distinguished guests, ladies and gentlemen, and my dear friend, Jaishankar, a very warm welcome to Singapore and to this session entitled “Navigating a World in Transition”.
2 Given the events of the past year and even in the past week, you would agree with me that we are certainly in a world in transition. Having to speak just before Jaisankar is always a challenge, so I took the precaution when I woke up this morning of consulting the only source that has more data than Jaishankar on geostrategic affairs and economics. I'm referring to ChatGPT and Microsoft Copilot.
3 I asked it a series of questions. I said, “Take a look back over 2,000 years – what was the peak and when did India and China reach the largest share of global GDP?” The answer is that if you look over 2,000 years, both India and China, when they were at peace, united and able to have an integrated economy, were able to achieve a share of global GDP of around 30 percent and sometimes even more.
4 Next, I asked it to list the wars fought between India and China- it gave me a series of seven or eight conflicts. What I noticed is that all these conflicts were basically border skirmishes. I then asked for a list of major invasions of India and the route by which these strategic invasions occurred. In fact, these go back thousands of years. All these strategic invasions into India were through the Khyber Pass in the northwest. Apart from border skirmishes, there has been never any strategic conflict across the Himalayas or even across the dense jungles of Southeast Asia.
5 This is relevant is because there is a reason why continental Southeast Asia is called Indochina, and why maritime Southeast Asia has, over millennia, been deeply influenced by India in culture, trade, religion, and to some extent, even the kingdoms and empires which have emerged over centuries in Southeast Asia. The relationship between India and Southeast Asia is a long-standing one, and one which has basically been mediated through maritime rule, and it's worth keeping that in mind.
6 My next series of questions then delve into economics. Easy question: who is the fifth largest GDP in the world today? Answer: India. Who's ahead of it? Germany and Japan. But you know that you’re within striking range- probably by 2027, it's quite possible to imagine India having the third largest GDP in the world. I then flip the question around and ask: which other region of the world has a combined GDP similar to India, and with a population similar to the EU? By that, of course, I'm referring to ASEAN. And it is interesting that even today, ASEAN's cumulative GDP is actually very close to India’s. If you think about the subject today, which is the world in transition, and you think in terms of demographics and economic potential, I will put to you one hypothesis: at least for the next two decades, major economic growth is going to occur in India and in ASEAN. Given our past history, there's much hope for that to be developed in tandem, and indeed accelerated.
7 I then turn my questions to trade – who is ASEAN's largest trading partner? And the answer: China. But you flip the question around – who is China's largest trading partner? And the answer is that for the last four or five years, ASEAN has overtaken the EU and the US in terms of total trade with China. If you ask the Chinese, they will say our largest trading partner is Southeast Asia.
8 I flipped my attention back to India. Who is India's largest trading partner? And the answer: number one is China, and number two is the US. And actually, trade between ASEAN and India is in that same ballpark, in excess of USD$100 billion. But if you drill down those three figures, it is very asymmetrical. India has a large deficit with China. India's trade with the US is on a similar scale as China, but instead of a deficit, India in fact has a slight surplus against the US. You may need to look at that in the coming months. It's going to be surprising to many people, but actually ASEAN-India trade is in the same ballpark as India's trade with the US. I think ASEAN may have some surplus, but it's not on the same order of magnitude as China.
9 I’m sharing my conversations with ChatGPT and Copilot to set the context for what we are facing and the directions which we need to set in the next 20 years. So where do we go from here?
10 The first point I would add is that if you shift your attention to more modern times, what was significant for Southeast Asia was when India opened up, its economic liberalisation post-1991. Since then, India has placed greater attention in Southeast Asia. We had the Look East policy, which I think was formalised in 1991, and Prime Minister Modi upgraded that to an Act East policy in 2014. And in fact, we have just reached a decade of the Act East policy. I am very proud to say that when Singapore was the coordinator of ASEAN-India relations, we succeeded in upgrading the ASEAN-India relations to a Comprehensive Strategic partnership in 2022. And Jai, we worked on that together.
11 At the ASEAN-India Summit last month, we welcomed the first decade of Prime Minister Modi's Act East policy, and I believe that Jai will agree that ASEAN is a cornerstone of Asia's foreign policy. These years of increased ASEAN-India engagement have paid off, and in between 2009 to 2023, our two-way trade more than doubled, and as I outlined earlier, exceeds USD$100 billion. But there is in fact potential to do a lot more because as I said earlier, the growth prospects, both demographics and economic, for both India and ASEAN are very positive, certainly for the next two or three decades.
12 So, if we add up our combined population with 2 billion people, we have a vast, dynamic, youthful and forward-looking workforce. And there is both a need and an opportunity to harvest the demographic dividend. Let us now outline a couple of areas where I think we can double down.
13 First is in the digital space. ASEAN aims to conclude the Digital Economy Framework Agreement by next year, and we believe India has a role to play in supporting ASEAN's push to become an integrated digital economy. In 2023, Singapore and India launched a real-time payment link between Singapore's PayNow system and India's Unified Payments Interface. This was the world's first real-time payment link that uses scalable cloud-based infrastructure and therefore allows it to accommodate future increases in remittance traffic. And believe me, there will be major increases in remittance traffic. But that's not all; that's just bilateral between India and Singapore. India will also be joining phase four of ASEAN's Project Nexus. Project Nexus is basically a project within ASEAN to connect the multiple domestic instant payment systems across the ASEAN network. When India becomes part of that, in phase four, we will achieve an integrated unified payment infrastructure between India on one hand and Southeast Asia one the other. So that's just one example.
14 The next issue is on security and geostrategic dimensions. Let me start off by recalling that there were five key leaders who in 1961 established the Non-Aligned Movement – India, Yugoslavia, Egypt, Ghana, and Indonesia. Now, the two superpowers in 1961 are clearly very different from 2024. But I would put to you that even in this day and age, when the cast and the balance may have altered, the original principles behind the Non-Aligned Movement, for the rest of us who wanted to focus on economic development, on making common cause, on multilateralism, on the rule of law and not to be forced to pick sides and to align with or against one or the other, those concepts remain just as relevant or even more relevant today. And therefore, the attitude that India will take in its leadership in the Non-Aligned Movement of the future, or maybe we call it Non-Aligned Movement 2.0, will be fascinating and in fact, critical.
15 If you move into the maritime and security aspects, the first ASEAN-India Defence Minister's Informal Meeting was held in November 2022, and I think you would agree with me, maritime security is a fundamental focus for all of us. And Singapore was happy to host the ASEAN-India Maritime Exercise in May 2023, and I expect these interactions to increase. After all, if for millennia, the primary avenue for Indian interaction with Southeast Asia has been the maritime avenue, it makes sense to maintain the serenity and calmness of the sea, and security and access to vital waterways. And on this note, I should add, I would expect India to be a natural partner with Southeast Asia in upholding the primacy of UNCLOS, the United Nations Convention on the Law of the Sea.
16 The third area is that we can do a lot more is to build on our historical cultural ties. The Indian Heritage Centre in Singapore chronicles the story of the Indian diaspora in Southeast Asia, and quite rightly celebrates a rich cultural legacy. But if you look across the region – temples, Angkor War, Borobudur; if you look at the Thai language, which has the influence of Sanskrit; Buddhism, Hinduism – it is obvious that we are building on very deep and strong foundations. The ASEAN-India Network of Universities is another good start that will promote youth interactions between our communities. We are also grateful to the Nalanda University for doubling the number of scholarships for ASEAN students.
17 So, let me conclude. This is a time of great transition, but this is also a time of great opportunity for India and for ASEAN. Our economic relations, our geostrategic relations all set us up to double down on cooperation, our non-aligned approach, and for standing up for a rules-based approach to greater economic integration between our two regions. And on that note, I’m going to invite Jai to fill in, and maybe disagree, and then we can have a good, robust Q&A session afterwards.
18 Thank you all.
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MINISTRY OF FOREIGN AFFAIRS
SINGAPORE
8 NOVEMBER 2024