The Hindu Business Line : Opening the Burma road

THE VISIT TO India of the Myanmar strongman, Gen Than Shwe — the first by a top leader of that country in 24 years — should be seen as a step towards consolidating the diplomatic and economic gains made by the "Look East" policy of the erstwhile NDA government, specifically under the stewardship of the then Foreign Minister, Mr Jaswant Singh. Incidentally, the visit to Yangon by the Vice-President, Mr Bhairon Singh Shekhawat, last November was part of this process; Mr Shekhawat was the highest-ranking Indian dignitary to visit Myanmar after the 1987 tour of the then Prime Minister, Rajiv Gandhi. Gen Than Shwe's visit should be seen as a symbolic starting point of a renewed effort to expand and deepen relations between the two countries, especially economic, which offers much scope.

In fact, nearly every initiative talked about between the two countries was mooted during the NDA regime, specifically the road projects, gearing up of rail and river transportation, the setting up of more border trade points, port development, construction of an oil refinery, hydro-electric power schemes, and prospecting for, and development of, gas fields in Myanmar with the participation of Indian companies such as ONGC. Apart from the energy aspect, all other discussions (including setting up State Bank of India branches in Yangon and the border town of Moe Reah) have as their objective an expansion of existing trade channels, specifically those catering to Myanmar exports to India. (Incidentally, India is Myanmar's second largest export market after Thailand, accounting for 25 per cent of its total despatches.)

As the Commerce Minister, Mr Kamal Nath, has said, though India suffers a perennial trade deficit with Myanmar (in 2003 it was $250 million on a total trade exchange of $400 million), the effort should not be to balance the trade or convert it into a surplus to our advantage. This is because the Myanmarese economy has not yet assumed great importance for Indian products. However, there is much greater complementarity between that economy and the North-East States, with which Myanmar shares a 1,600-km porous border, the most important part of the untapped potential being the import of energy to fuel industrial development in this corner of India. It is with this in view that strategic thinkers are emphasising the development of the Tamanthi hydro-electric project and the building of a pipeline from the significant gas reserves in the Arakan region, a project in which, not surprisingly, multinational energy giants such as Unocal have shown an interest.

The diplomatic aspect of the economic initiative between New Delhi and Yangon lies in the fact that pressure will be put on Dhaka to settle the longstanding gas-supply problem vis-à-vis India should Myanmarese gas begin to flow into the North-East. But more important is the task of countering the expanding Chinese influence over the Myanmar economy and through it over the that nation's polity, which can be best accomplished by stepping up the Indian economic presence. Towards this end, Mr Kamal Nath's target of more than doubling the India-Myanmar trade exchange to a billion dollars by 2006 should be seen as a sensible first step.

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