Amid China tensions, Southeast Asia looks to India

NEW DELHI Thu Dec 20, 2012 12:30am IST

1 of 2. Sailors salute during a ceremony held before a Chinese naval fleet including two destroyers and a supply ship from the South China Sea Fleet set off from Sanya, Hainan province December 26, 2008.

Credit: Reuters/China Daily/Files

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NEW DELHI (Reuters) - Southeast Asian leaders are expected to lay out a vision for closer cooperation with India on security and the economy at a high-level gathering in New Delhi at a time of tension with China in the potentially oil- and gas-rich South China Sea.

The meeting is a ceremonial summit to mark 20 years of cooperation with India and will not include detailed negotiations on regional issues, India's Foreign Minister Salman Khurshid told Reuters.

But ministry officials said the leaders would also produce a statement which is expected to reiterate a commitment to freedom of navigation, a hot issue because of territorial conflicts in the South China Sea.

Some ASEAN countries contest claims by China in the waters, making it the biggest potential flashpoint in the region. The United States has called for calm, but some are also looking to India, the other regional heavyweight, to get involved.

"They want India to play a larger role. Those concerns are only increasing given the uncertain situation that is emerging," said C. Raja Mohan, a strategic affairs expert at the Observer Research Foundation think-tank.

For India, improved relations with Southeast Asia will give it entry into one of the fastest-growing economic regions in the world and a source of raw materials needed for its own growth.

But there are poor transport links between India and the nations to its southeast, and constraints like India's tiny diplomatic corps - similar in size to New Zealand's - mean India trails China in relations with the region.

Trade between India and the 10-member ASEAN was up to $80 billion last year compared with $47 billion in 2008. An agreement on free trade in services and investment could be signed at the New Delhi meeting.

But India's role in the region is dwarfed by that of China, which enjoyed trade worth a record $363 billion with ASEAN countries in 2011 in an already established free trade area.

"What we need is far greater connectivity," Khurshid said in an interview with Reuters, mentioning roads, railways and flights as areas needing work. He described a 10-year plan to double the number of diplomats to reflect India's global ambitions.

"RESPECT FOR LAW OF SEA"

The prime ministers of Thailand, Singapore, Cambodia, Malaysia and Vietnam, the presidents of Myanmar, Laos and Indonesia, and the vice president of the Philippines are scheduled to attend the summit along with the sultan of Brunei.

India walks a delicate line to balance its increasingly close partnership with Washington as President Barack Obama steps up the U.S. presence in Asian, and the reality of living next door to China, Asia's fastest-growing superpower.

Khurshid played down the possibility of any tension with China and reiterated that India had no territorial claims in the South China Sea.

"I don't think this is something that will reach hostility or conflict, there are differences obviously - China has a very clear perception about its sovereignty and it also has a very clear idea of how it wants to resolve these issues.

"It's not something that cannot be resolved, it is certainly not something in which we are directly involved, we've said categorically that there should be compliance and respect for the law of the sea."

But India's "Look East" policy and a need to lock down energy supplies for its rapidly growing industrial sector are pushing it gradually to step up military activities in the region with more joint exercises and visits.

The meeting's statement on ties will include elements of an expert report ASEAN adopted at a meeting in Cambodia in November, an Indian foreign ministry spokesman said.

The experts called on India and ASEAN to work together to ensure "evolving regional economic and security architectures will promote the goal of open regionalism".

This month, India's navy chief said his force was ready to deploy naval vessels to the South China Sea to protect its oil-exploration interests there if needed.

India is exploring oil and gas blocks with Vietnam in the disputed waters and in future is likely to bring more liquefied natural gas through the Malacca Straits.

(Additional reporting by John Chalmers; Editing by Raju Gopalakrishnan)

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