3 days ago
Why Manila wants to engage more with New Delhi
The visit by President Bongbong Marcos of the Philippines to India (August 4-8) is under the aegis of the India-ASEAN Comprehensive Partnership. From that, it has drawn sustenance and inspiration to raise the bilateral partnership to a strategic one.
India's partnership with the Philippines serves as a cornerstone of its 'Act East' Policy, Vision MAHASAGAR, and its broader Indo-Pacific strategy. As the two nations mark 75 years of diplomatic relations, this milestone offers a meaningful opportunity to deepen bilateral cooperation and engage in dialogue on key regional and global challenges of mutual interest. Looking ahead, the Philippines' upcoming chairmanship of ASEAN next year adds further significance to this evolving partnership.
The enhancement of the relationship is strategic. The Philippines is the loudest in criticising China on its aggression in the South China Sea. Under Marcos jr, the policy of accommodating China at all costs has given rise to defending its national interest, in which engaging Japan, Australia and the US are top priorities. India now plays an important role in the Philippines' thinking. The Philippines won the arbitral award against Chinese claims in 2016, but only pursued those under Marcos. India in the last three years has been responsive to the Philippines' position on the SCS. Manila has decided to join the International Fusion Centre established by India for the Indian Ocean Region.
Beyond the strategic enhancement of relationships, which positions the Philippines and Singapore among India's closest strategic partners within ASEAN, there is growing interest in expanding connectivity between India and the Philippines. Due to the geographical distance, the Philippines has long lacked direct shipping, flights, or connectivity initiatives of the kind India already enjoys with other ASEAN nations.
Recent developments suggest a shift. The Philippines' decision to grant visa-free entry to Indian nationals, coupled with Air India's move to start direct flights, is expected to boost tourism and enhance people-to-people contact, an area in which the India-Philippines partnership has historically lagged behind other ASEAN countries. The success of direct connectivity in promoting tourism in countries like Vietnam, Cambodia, and Indonesia reinforces this trend.
While trade and investment have traditionally been the cornerstones of India's ties with ASEAN, India-Philippines trade relations have remained modest. The Philippines ranks sixth among the 10 ASEAN member states in trade with India. In 2023–24, bilateral trade was $3.5 billion: Indian exports accounted for approximately $2 billion, while imports from the Philippines reached about $1.5 billion.
The Philippines has historically been a hesitant participant in ASEAN-India trade frameworks, often being the last to ratify major agreements. However, progress is underway. Since June 2023, a new agreement on cooperation and mutual assistance in customs matters has been in place. Negotiations on a Preferential Trade Agreement have resumed, and discussions continue around the Terms of Reference (ToR) for a Trade Negotiations Committee. While the Philippines is a part of the Regional Comprehensive Economic Partnership and the Indo-Pacific Economic Framework for Prosperity, it has not emerged as a major trade actor in either. Its key trading partners remain China, the US, Japan, Hong Kong, Australia, and New Zealand.
Despite having a higher GDP per capita than India, the Philippines recognises India's status as an emerging economic powerhouse, growing at nearly 7 per cent annually. This recognition is prompting Manila to engage more actively with New Delhi. Indian investments in the Philippines are valued at around $5 billion, primarily in IT and ITeS, pharmaceuticals, healthcare, and biomass energy. Filipino investments in India are limited but could grow, especially with the rise of regional supply chains. Financial technology is a priority area for both governments, and a MoU was signed in 2023 to strengthen cooperation.
While the Philippines received 1.4 million tourists in 2023, only around 30,000 were from India. This number is expected to grow rapidly with the newly introduced visa-free travel and direct air connectivity, setting the stage for a deeper and more dynamic India-Philippines relationship. The new impetus to this is based on the wider Indo-Pacific concept, recognising the Act East Policy for its worth.
The writer is author of The Mango Flavour: India & ASEAN after 10 years of the AEP
