India, East Asia move beyond trade rivalry towards strategic alignment as US-China contest escalates

What Happened

• India and several East and Southeast Asian nations are deepening strategic, defence, and technology partnerships at a pace that goes beyond their traditional trade relationship, driven by the escalating US-China competition in the Indo-Pacific.
• High-level diplomatic engagements have intensified: a Vietnamese head-of-state visited India in May 2026; South Korea's president made a state visit to New Delhi; Indonesia's president was chief guest at India's Republic Day 2025; and the Indian Prime Minister is scheduled to visit Indonesia in July 2026.
• Defence cooperation has become a key pillar, with BrahMos missile deals already signed with the Philippines and Vietnam, negotiations ongoing with Indonesia, and joint manufacturing partnerships in artillery systems being expanded with South Korea.
• Semiconductors, critical minerals, and emerging technologies have been identified as priority sectors for collaboration, reflecting concerns about supply-chain concentration in China.
• Underlying trade imbalances — India runs a $51.49 billion deficit with ASEAN (2025-26) — remain a structural irritant, and the stalled AITIGA review continues to limit full economic integration.

Static Topic Bridges

ASEAN-India Trade in Goods Agreement (AITIGA)

AITIGA, signed in 2009 and in force since 2010, governs tariff liberalisation between India and the eleven-member ASEAN bloc. India eliminated duties on 74.2% of its tariff lines under the agreement, but the reciprocal liberalisation from key ASEAN economies has been asymmetric — Indonesia covered only 50.1% of tariff lines and Vietnam 69.7%. India has long characterised the agreement as "lopsided" given persistent trade deficits and non-tariff barriers faced by Indian exports. A formal review, agreed upon in 2023 and targeting completion by 2025, remains stalled, with Indonesia and Vietnam yet to fulfil their tariff-elimination commitments.

BrahMos Missile and India's Defence Export Policy

BrahMos is a supersonic cruise missile developed jointly by India's Defence Research and Development Organisation (DRDO) and Russia's NPO Mashinostroyenia under a joint venture (BrahMos Aerospace Pvt. Ltd). With a range of approximately 290 km (export variant) and a speed of Mach 2.8, it is among the fastest operational cruise missiles in the world. The Philippines became the first country to sign an export deal for BrahMos in January 2022, worth $375 million (Rs. 3,202 crore) for three shore-based anti-ship missile batteries. This marked a turning point in India's defence export trajectory under the "Aatmanirbhar Bharat" and Defence Export Policy 2020, which targets defence exports of Rs. 35,000 crore by 2025.

India-South Korea CEPA and Defence Co-production

The India–South Korea Comprehensive Economic Partnership Agreement (CEPA), signed August 7, 2009, and in force from January 1, 2010, was India's first trade agreement with a Northeast Asian nation. It covers trade in goods, services, and investment, and produced a 70% increase in bilateral trade initially. Merchandise trade stood at $27.36 billion in the most recent fiscal year. Defence co-production under this partnership — particularly the K9 Vajra-T 155mm self-propelled howitzer manufactured by Larsen & Toubro with Hanwha Aerospace's technology — represents an advanced model of "Make in India" in the defence sector, with over 80% localisation in the first batch of 100 units.

Indo-Pacific and the Quad Framework

The Indo-Pacific as a strategic concept positions the Indian Ocean and the Pacific Ocean as an integrated geopolitical theatre, distinct from the earlier Asia-Pacific framing. India formally adopted the Indo-Pacific framing in its foreign policy discourse around 2018. The Quad (Quadrilateral Security Dialogue), comprising India, the United States, Australia, and Japan, is the primary plurilateral security forum in this space, revived at leaders' level in 2021. Separately, India maintains bilateral strategic partnerships with ASEAN members through formats like the India-ASEAN Summit, the East Asia Summit (EAS), and the ASEAN Regional Forum (ARF).

Key Facts & Data

• India-ASEAN trade deficit (2025-26): $51.49 billion (imports $89.96 bn; exports $38.46 bn)
• India-South Korea merchandise trade: ~$27.36 billion; goods deficit ~$15 billion
• Vietnam textile exports (2024): ~$49 billion (largely to US); India textile exports (2024): ~$37.7 billion
• Philippines BrahMos deal: $375 million, signed January 28, 2022 — India's first defence export of this scale
• K9 Vajra-T follow-on order (Dec 2024): 100 units, ~$850 million, 60% local manufacturing
• AITIGA in force since January 1, 2010; review agreed 2023, targeted completion 2025 — stalled
• India-ASEAN Comprehensive Strategic Partnership: elevated in 2022
• ASEAN has 11 member states; India-ASEAN summit dialogue partner since 1992