The grant issued by the Japanese government just could not go unnoticed by the stakeholders of Indo-Pacific. The US$36 million in aid to install a battery energy storage system on India’s Andaman and Nicobar Islands ‑ Japan’s first-ever grant to the strategically located islands ‑ is much more than clean energy.
Sitting at the mouth of the Malacca Strait, arguably the most important chokepoint in the world, the islands give India and its friends a front-row view of Chinese vessels going into and out of the narrow waterway.
On 26th March, Japanese Ambassador Satoshi Suzuki and C. S. Mohapatra, an Additional Secretary at India’s Ministry of Finance, exchanged notes in New Delhi concerning grant/aid of US$36 million to install a battery energy storage system at the Phoenix Bay Power House on the island of South Andaman to utilize renewable energy and stabilize energy supply.
“It contributes to our shared vision for a free and open Indo-Pacific, and also contributes to Prime Minister Yoshihide Suga’s goal of offering climate change assistance,” the official said.
“The real advantage the Andamans provide to India is the ability to conduct surveillance over critical waters,” said Darshana Baruah, an associate fellow with the South Asia Program at the Carnegie Endowment for International Peace.
“The islands offer unparalleled advantage in surveillance and monitoring the Malacca Strait. It is also close to the Straits of Indonesia, the alternate route into the Indian Ocean, especially for submarines,” she said.
“A coherent monitoring and response mechanism will help India detect Chinese vessels upon their entry into the Indian Ocean.”
But to maximize their potential, and to host more personnel on the islands, they will need to develop infrastructure, including water, electricity, housing and internet access. “The Japanese grant addresses a key requirement on the ground that will help India better utilize the strategic potential of the Andaman and Nicobar,” Baruah said.
Tanvi Madan, a senior fellow and director of The India Project at the Brookings Institution, noted that while the power grid funded by the grant contributes to civilian infrastructure, “it serves a dual purpose.”
Madan said that the grant comes at a time when India is stitching in Andaman and Nicobar into its strategic tapestry in a much more significant way and reflects a change in attitude on both the Indian and Japanese sides.
India was the first country Japan extended official development assistance to in 1958. But India has always been reluctant to bring external actors into the Indian Ocean. Japan, for its part, has been hesitant to be too active in India’s strategic periphery, to avoid being unnecessarily provocative to China, Madan said.
On India’s side, two things are clear, Madan said. One, there is recognition that China, including through its navy, will be increasingly active in the Indian Ocean region. Second, because India cannot tackle that growing presence on its own, “you have now seen a broader switch in Indian strategy that has involved both developing its own capabilities and welcoming other external actors.”
China has been boosting its presence in the Indian Ocean, opening its first overseas military base in Djibouti and building a series of commercial ports in Myanmar, Pakistan, Sri Lanka, and the Maldives that could eventually serve a military purpose.