India-Japan 2+2: Setting the Stage for the Post-Kishida Phase

The Indo-Pacific has remained center stage in Tokyo’s strategic outreach in recent weeks – be it aligning with key allies in the foreign ministers’ meeting of the Quad and East Asia Summit or pushing the geoeconomic agenda with the launch of the Crisis Response Network under the Indo-Pacific Economic Framework (IPEF). After a series of crucial 2+2 meetings, including with the United States and Philippines, and a defense trilateral with the U.S. and South Korea, the next stop for Japanese ministers is Delhi. 

The India-Japan 2+2 on August 20 is of pivotal importance. It will allow New Delhi to sharpen its understanding of not only Tokyo’s regional threat assessment but also the undercurrents in domestic politics, and set the stage for a post-Kishida phase. 

Dilemma of Domestic Politics

While the U.S. elections in November remain front and center in many strategic discussions, domestic developments in Tokyo are also uncertain. Prime Minister Kishida Fumio’s domestic political base has crumbled. Power dynamics within the kingmakers of the ruling Liberal Democratic Party (LDP) guaranteed him a rocky ride. 

In sharp contrast to Kishida’s leadership in international platforms, be it the G-7 or engaging Europe through NATO, his political future in Japan was on thin ice with abysmal approval ratings. His government moved from one crisis to another – the Unification Church revelations to the slush fund scandal. With setbacks in recent by-elections, the LDP is sensing a real possibility of losing ground in the general elections in 2025. Hence a new leadership to reinstate public confidence is the need of the hour. 

While Kishida repeatedly delayed speculations over snap elections in the past few months, his exit became imminent as the LDP, now with a dissolved factional chessboard, heads for a presidential election in September. Ultimately, Kishida decided not even to compete for re-election, instead bowing out entirely to pre-empt any electoral damage for his party. That guarantees Japan will have a new prime minister this fall. 

With Kishida bowing out, the political ambition of other LDP figures will be put to the test. Former Defense Minister Ishiba Shigeru, Digital Minister Kono Taro, former foreign minister and current secretary-general of the LDP Motegi Toshimitsu, former Economic Security Minister Kobayashi Takayuki, and female front runners including current Economic Security Minister Takaichi Sanae as well as Foreign Minister Kamikawa Yoko present potent alternatives in the LDP election. 

The next government in Japan will face colossal challenges including a weak yen, scaling up the defense budget to 2 percent of GDP while shelving commensurate tax hikes, and more importantly navigating the demographic dilemma and its profound impact on national security. All of this will take determined political leadership and policy stability. Japan’s partners – including India – will be watching closely for signs that Kishida’s successor is up to the task. 

The China Conversation

As tensions simmer in the key subtheaters of the Indo-Pacific, one of the key focuses at the 2+2 in Delhi will be coordinating China strategy. While Japan’s revised National Security Strategy of 2022 identified China as the “greatest strategic challenge,” 2023 witnessed the return of the narrative of a “mutually beneficial” China-Japan relationship “based on common strategic interests” in the political space as well as the Foreign Ministry’s Diplomatic Bluebook. This created some contradictions in Japan’s China policy. 

As Tokyo falls behind Washington and some of its European partners, including France and Germany, in opening up high-level exchanges with Beijing, some argue that “structural stagnation” in bilateral relations is eroding opportunities to gain practical insights, affecting a balanced China strategy. Some have even argued that while Tokyo is not in a position to endorse China’s “global initiatives,” it can show goodwill under certain conditions. We have seen this before in the case of Japan lending support to the Belt and Road Initiative by pursuing third country projects. 

On the other hand, fast altering realities in Northeast Asia – including the recent firming up of the Russia-North Korea axis, alongside the China-Russia “strategic alliance” as framed by Japanese defense white papers – is raising “grave concerns” for defense planners in Tokyo. Averting the emergence of a Sino-centric regional order has led to serious conversations on deterrence as grey-zone operations intensify in the South China Sea and Taiwan Strait. The recent restructuring of the command-and-control structure of the alliance on both the Japanese and U.S. sides, reinforcing cross-domain operations, is aimed at better preparedness. 

Culling out the geoeconomic trends, Tokyo’s robust economic security laws are largely aligned with Washington in terms of tightening export control on sensitive technologies. However, growing e-commerce trade as well as economic integration involving China via mega free trade agreements is a reality. Tokyo is adapting to the new realities with not just a “China Plus One” but “China for China” strategy as well. Tokyo’s economic interaction with Beijing is driven by the goal of easing dependence given rising labor costs and tense politics around supply chain, and Japan will not seek to fully decouple. 

The Bangladesh Bang 

At the 2+2 ministerial, South Asian geopolitics will also be high on the agenda. Unrest in Bangladesh will reverberate. 

Both India and Japan hold Bangladesh, with its strategic location in Bay of Bengal, as a central piece in their “Neighborhood First” and “Free and Open Indo-Pacific” policies, respectively. But as an immediate neighbor, New Delhi approaches the recent developments in Bangladesh with utmost caution and through the prism of national security. The trend of political volatility across this region including Sri Lanka, Pakistan, Myanmar, and now Bangladesh does not auger well for India’s security. Rebuilding political trust with Bangladesh will be a time-consuming process. Meanwhile, Tokyo would be keen on economic stability given its investments and infrastructure projects. 

For India and Japan, Bangladesh hosts key showcase projects where both pursued mutual strategic interests by reimagining connectivity, pushing a “triple I” strategy of infrastructure, investment, and industrial value chains. However, given the developing crisis in Bangladesh, one of the talking points at the 2+2 will be the future trajectory of the recently launched Northeast India-Bay of Bengal Industrial Value Chain corridor project, which links Tokyo’s Big-B project in Bangladesh with India’s Northeast Road Connectivity Improvement projects, and seeks to develop an economic corridor connecting Matarbari deep sea port through Chattogram and Dhaka to Northeast India. 

Third country cooperation is always a challenge given the interplay of geopolitics alongside domestic politics as witnessed in the case of Sri Lanka as well. Additionally, soft infrastructure hurdles including non-tariff barriers, advancing trade facilitation, and cross-border customs logistics also complicates the process. 

Defense Technology 

While India-Japan maritime security cooperation stands on firmer footing, progress on  technology cooperation needs greater attention at a time when Tokyo is making incremental changes to its policies, including the 2023 revision of Three Principles on Transfer of Defense Equipment and Technology and the 2024 revised Implementation Guidelines; the recent launch of the Basic Policy on AI by Japan’s Defense Ministry; and the setting up of a DARPA-style research institute that will develop new breakthrough technologies. 

International joint development is front and center in Japan’s 2024 Defense White Paper. Japan has made progress on the joint development of next-generation fighter jets with the U.K. and Italy as well as cooperative development of Glide Phase Interceptor (GPI) with the U.S.; signed the Research, Development, Test and Evaluation (RDT&E) Arrangement with Australia; and delivered air surveillance radar systems to the Philippines. India needs to plug into these conversations and tap newer opportunities opening up in Japan while navigating the challenges of cost competitiveness, technology transfer, and export controls. 

Post-Kishida Leadership

As Kishida leaves the stage, the primacy of India will continue in Japan’s Indo-Pacific outlook given its strategic geography, demographic profile, and economic clout. A rising India, one of the potent voices of the Global South, will continue to play a pivotal role in shaping the basic direction of global politics in the next decade. 

Kishida’s decision to launch Japan’s New FOIP policy from Delhi in March 2023, building on the legacy of Abe Shinzo’s historic speech, “Confluence of the Two Seas,” in the Indian Parliament demonstrates India’s primacy in Japan’s strategic thinking. The 2+2 ministerial meeting will be a force multiplier in setting the stage for Japan’s next leader to further consolidate the foundation of this strategic partnership as a net positive asset in the Indo-Pacific.