India’s Strategy In Myanmar

Via STRATFOR (subscription required), a look at the growing importance of Myanmar in India’s struggle to secure and integrate the eastern periphery of the subcontinent more closely with its own national core. As India’s domestic energy and infrastructure demands grow, meeting them will require developing stronger ties with resource-rich neighbors, especially where other regional powers — such as China, in the case of Myanmar — may infringe upon India’s strategic imperatives.  As the report notes:

Understanding Myanmar’s strategic significance for India requires a consideration of India’s geographic and strategic imperatives. Historically, Indian political power emanates outward from the fertile and populous Ganges River basin. The goal of India’s rulers has always been to extend Indian influence to the subcontinent’s natural boundaries: the Indian Ocean, the mountains of present-day Afghanistan, the Himalayas and the heavily forested hills of northwest Myanmar. This way, India builds physical buffers around its population core and creates the resource and economic linkages necessary to keep that core running. Only if the core and its immediate periphery are secure can India begin to exert itself more broadly — by land via Southeast Asia as well as by sea.

Contemporary Indian foreign policy is in many ways an outgrowth of this strategy. India continues to recognize the importance of building stronger relations with countries such as Myanmar to create greater economic and political stability along its porous borders. Today, the strategic importance of peripheral countries such as Myanmar, Nepal and Sri Lanka is compounded by their natural resources. Myanmar’s water, natural gas and oil resources are among the richest in India’s proximity. 

Strong relations with Myanmar are also key to India’s struggle to develop and integrate its geographically isolated northeastern states into the national economy and cultivate new markets for Indian goods coming from eastern ports like Kolkata. The first goal has been difficult to achieve. Currently, the only way to get goods into these states without passing through Bangladesh is through the Siliguri Corridor, which is less than 50 kilometers (about 30 miles) wide at its widest point. Rugged hills compound the problem by complicating India’s efforts to police the border with Myanmar, and strained relations with Bangladesh over the years have further isolated the northeastern states from the rest of India.

While India over the last decade has pushed for more road, rail and pipeline connections with Bangladesh, concrete progress has been minimal, often because of Bangladeshi fears that these moves could endanger its own national or energy security. If India is going to develop and stabilize its northeast, it will need more than one point of entry — a possibility that Myanmar provides.

India’s Projects in Myanmar

While in Naypyidaw, Singh will propose a number of measures to improve development and connectivity with Myanmar. He will also reaffirm India’s commitment to infrastructure projects such as the Tamanthi and Shwezaye hydropower projects; the Shwe oil and natural gas fields, which Indian companies are involved in operating; and the Kaladan Multi-Modal Transport (KMMT) network, which is designed to encourage closer links between the port of Kolkata, Myanmar’s Sittwe port and, through road networks in Myanmar, India’s northeastern states. Each of these projects, if completed, would help India meet the conjoined goals of energy security and economic integration of the subcontinent’s periphery.

The largest and most strategically important of India’s investments in Myanmar is the KMMT. Construction began in 2010 and consists of three general phases: dredging and modernizing the port at Sittwe, near the Shwe oil and natural gas fields on Myanmar’s northwest coast; dredging sections of the Kaladan River to allow for larger ships to pass up to Paletwa in northern Myanmar; and linking Paletwa by road to the Indian state of Mizoram, which would provide the isolated northeast a second point of entry in addition to the Siliguri Corridor.

If completed, the KMMT would allow goods from eastern Indian ports such as Kolkata to reach India’s northeastern states more cheaply. (Presently, most goods transported to provinces like Arunachal Pradesh and Assam have to be trucked in; while quick and convenient, road transport is prohibitively expensive for long-distance transport in many parts of India). The KMMT would also enhance economic ties between coastal Indian urban hubs and the Myanmar economy, an attractive prospect for India as Myanmar’s 60 million people begin to consume more foreign goods. 

But the KMMT, like most of India’s infrastructure investments in Myanmar, has encountered obstacles. First, higher costs than anticipated (especially for road construction along Myanmar’s jungle-covered hills) have raised questions about continued financing — India, which pledged to fund the entire project, has already invested $134 million. Moreover, the two countries recently sparred over Naypyidaw’s proposed hydropower projects on tributaries of the Kaladan River. The projects could lower water levels on the river, leaving it less viable as a shipping corridor for Indian goods. 

Several of India’s other major investments in Myanmar also have stalled or simply lack a clear end goal. Construction on the Tamanthi and Shwezaye hydropower projects on Myanmar’s Chindwin River, agreed to in 2004 and funded primarily by India, has ground to a halt. Blame for stalled construction has fallen largely on the disorganization of Indian companies involved, and recent reports in international media suggest that Chinese state-owned companies may try to take over construction and operation of the dam.

Similarly, although Indian state-owned oil companies have invested in two blocks of Myanmar’s largest oil and natural gas field, Shwe, they lost the contract to purchase the natural gas when proposals for an India-Bangladesh-Myanmar pipeline fell through. Purchasing rights quickly went to the Chinese, who built a pipeline linking Shwe to Yunnan province.

India’s Energy Needs and Strategic Worries

For India to maintain high growth levels, it will have to significantly increase its power distribution capacity. In turn, this will require greater developments in domestic energy and power infrastructure, better utilization of homegrown natural resources and more energy imports. It will also require more stability and coordination in the country’s periphery and better integration of the many parts of India’s population that do not currently participate in the national economy in a meaningful way. Today, internal cultural and political divisions shaped by geographic diversity and, in parts, isolation make it difficult for New Delhi to act effectively in its core territories, let alone along the periphery. For India, building modern energy and transport infrastructure goes hand in hand with stabilizing its borders — especially its porous border with Myanmar. 

In this respect, China and India are similar. Like India, China recognizes Myanmar’s strategic potential, not only as a supplier of natural resources to supplement ballooning Chinese domestic demand but also as the geographic hinge of three Asian sub-regions: China, Southeast Asia and the Indian subcontinent. For China, Myanmar offers a faster, cheaper avenue to get goods and resources like oil and natural gas to southwestern China’s landlocked provinces. It also gives China a potential lifeline to global sea trade if the Strait of Malacca — through which most of the goods China imports flow — were to close. Recognizing this potential, Beijing has acted aggressively over the last decade to develop deep ties to Myanmar’s ruling party and has invested in an array of energy and infrastructure projects.

India, by contrast, has moved slowly and sporadically, even after adopting a more aggressive foreign policy in the early 1990s. What before was only a diffuse sense of competition between the two countries over Myanmar may soon solidify as outside investment enters the country. In the meantime, Chinese investments have already directly infringed on India’s interests in Myanmar, and will continue to do so.

Myanmar will never be a major source of energy for India. But it is in India’s backyard, and any future Indian engagement with Southeast Asia by land will require passing through Myanmar’s borders. If India fails to secure a foothold in Myanmar now it may not get another chance in the future, as investment from China increases and Western countries become more entrenched in the region. While Myanmar’s democratization and diplomatic opening provide the pretext for Singh’s visit, the trip is much more about utilizing India’s geographic proximity and historical ties to ensure that its strategic interests in Myanmar are fulfilled while it is still possible. Myanmar’s diplomatic opening means that India cannot afford to lose what head start it has already gained there.

This entry was posted on Monday, May 28th, 2012 at 6:34 am and is filed under India, Myanmar.  You can follow any responses to this entry through the RSS 2.0 feed.  Both comments and pings are currently closed. 

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