By Afeena Ashfaque —
Night traffic in Kolkata, West Bengal in India. Countries of the Quad – the United States, Japan, and Australia – have an opportunity to deepen cooperation on infrastructure investment and development projects to aid the Quad’s fourth member, India. Source: Rudresh_calls’ flickr photostream, used under a creative commons license
On December 27, 2018, the Australian High Commission in India announced that the government had authorized funding for a planned new consulate in Kolkata. With this development, Australia joins the United States and Japan with a significant diplomat presence in India. While this group of countries, which form the “Quad,” is not primarily viewed as a vehicle for economic cooperation, all four countries have an opportunity to deepen their cooperation by coordinating their various bilateral infrastructure partnership initiatives and building upon their respective footprints to provide infrastructure financing for development projects at the state and local levels throughout India .
Bilateral Initiatives between India and Members of the Quad
The United States, Japan, and Australia have already undertaken significant investments in India at this level for some time now. For example, the U.S. Trade and Development Agency has launched initiatives to provide technical assistance to support the development of Smart Cities technologies in India. Other engagements at the state and local levels include Treasury Department advice and technical support to the Pune Municipal Corporation for the establishment of India’s first municipal bond issue in over 15 years, and the U.S. Agency for International Development’s partnership to promote healthy cities in India by increasing access to clean water and sanitation.
The United States plans to expand on this bilateral cooperation in coming years. The Trump administration has announced over $100 million in new infrastructure support funds in June 2018. Moreover, the passage of the Better Utilization of Investments Leading to Development (BUILD) Act in Congress will add billions of dollars in infrastructure aid funding across the Indo-Pacific region, and will create a new “U.S. International Development Finance Corporation.”
Similarly, Japan has supported the development of India’s infrastructure with financing and technical assistance for the development of Delhi-Mumbai Industrial Corridor, a $90 billion mega-infrastructure initiative stretching over 900 miles that will connect India’s political capital of New Delhi with its business capital of Mumbai. As part of this project, Japan will provide nearly 80 percent of the financing for the development of the 400-mile long Mumbai-Ahmedabad Bullet Train Project. Japan is also providing over $350 million in development loans to India for the improvement of roads and bridges in the North Eastern Region in hopes of promoting regional socioeconomic development.
Australia has also launched significant bilateral initiatives to provide new financing for infrastructure in India. In 2017, Australia’s sovereign wealth fund, with $91 billion of assets under management, announced it will invest in Indian infrastructure such as roads, telecommunications, and clean energy. In November 2018, it also announced the establishment of the Australian Infrastructure Financing Facility for countries in the Indo-Pacific region, creating a $2 billion infrastructure initiative, and providing an additional $1 billion in capital to Australia’s export financing agency.
The Scope for Joint Cooperation in India
Given the breadth of the infrastructure projects and support these countries are undertaking on a bilateral basis with India, there is considerable scope for the four Quad countries to deepen their coordination and cooperation on joint infrastructure initiatives in India. Such efforts could improve efficiency, help realize new synergies, and generate return on investment for their infrastructure projects in India.
Moreover, since India is limited by its fiscal constraints to commit major investments for regional infrastructure development, joint coordination by the Quad members will not only advance their relations with India, but also provide much needed depth and substance to their “free and open Indo-Pacific” strategy.
Today the Quad, as a group of like-minded democracies, is still finding its feet and seeking to clarify its mission in the Indo-Pacific region. Deepened coordination on infrastructure development within India could help the group become more cohesive as it prepares to take more ambitious steps in the future in promoting joint-infrastructure development initiatives throughout the Indo-Pacific region. They should look to the growing number of consulates these countries have in Indian cities to help coordinate joint development projects in India.
Ms. Afeena Ashfaque is a Program Coordinator & Research Assistant with the Wadhwani Chair in U.S.-India Policy Studies at CSIS. Follow her on twitter @AfeenaAshfaque.
