Neither Friend Nor Foe: Geopolitical Dynamics of India–Malaysia Relations

Mayilvaganan M & Nurul Aishah Ab Raman . #2404 . International Affairs Perspective . 11 April 2024 .

Mayilvaganan Muthumariappan and Nurul Aishah Ab Raman examine the geopolitical dynamics of India-Malaysia relations in the Indo-Pacific region, emphasizing how historical ties, trade, and security concerns shape their interactions. The complex relationship evolves over time, with collaboration in trade, cultural exchange, and diplomacy strengthening bilateral relations. However, tensions reflect the nuanced nature of their association. While both countries are maritime powers in the Indo-Pacific, they are not formal strategic partners, as Kuala Lumpur engages with India but lacks decisiveness. Global geopolitical shifts and regional developments influence their bilateral dynamic, and this article explores the complexities that hinder effective cooperation despite potential for collaboration.

Introduction

The historical context of diplomatic relations between India and Malaysia is extensive and diverse. Their relations can be traced back to ancient maritime trade routes, with links between Malaysia and the Indian Subcontinent dating as far back as 110 AD. Notably, the Kadaram (Kedah) and Malacca sultanates (Melaka) had historical and trade connections with India, and were even under South Indian kinship.

Archaeological findings in Bujang Valley indicate the presence of migrants from ancient India in the region. Additionally, the Malay Archipelago saw regular sea voyages from India. The British, during the 18th and 19th centuries, brought in Indian laborers to Malaysia for the purposes of forest clearing, plantation work, mining, and construction, thus, reinforcing the longstanding connection between India and Malaysia.

Over time, the influence of the Indian diaspora (about 7 percent) and cultural affinities has played a significant role in shaping this relationship. Furthermore, spanning across the realms of art and cuisine, the exchange of ideas, philosophies, and values greatly bolsters the relationship between India and Malaysia. This profound blending of cultural expressions not only fortifies the ties between the two nations but also contributes to a broader global understanding of the shared heritage and interconnectedness of diverse cultures.

The significant presence of Indian descents occasionally leads to tensions, but the cultural similarity undoubtedly serves as a tool of soft power in fostering mutual understanding between the two nations.

Notably, with Malaysia’s economic growth and India’s Look East policy in the 1990s, both countries have emerged as pivotal trading partners, engaging in substantial bilateral trade and investments. The increasing economic ties have led to a flourishing exchange not only in terms of goods and services but also in terms of technology and expertise.

Malaysia and India leverage each other’s strengths and resources, creating a more robust and diversified economic landscape for both countries. This partnership not only brings economic benefits but also fosters cultural exchange and people-to-people ties, strengthening the overall bond between the two nations.

Over time, both countries have engaged in regular high-level dialogues and negotiations, aimed at strengthening cooperation in strategic, defense, and security domains, while also safeguarding their respective interests. In a sense, the intricacies of this relationship are magnified by the varied cultural, political, and economic environments within each nation.

Unequal Equals

The significance of analyzing the India-Malaysia relationship becomes even more pronounced when viewed through the lens of the Indo-Pacific, a region of increasing geopolitical importance.

India, a dominant regional power in Indo-Pacific with substantial technological capabilities, a large military, expansive geographical territory, a significant population, and an expanding economy, maintains a steadfast focus on bolstering its relations with the Southeast Asian countries.

The introduction of India’s Look East Policy (LEP) in 1991 prominently highlighted the efforts to strengthen connections between New Delhi and Kuala Lumpur, as well as the broader Southeast Asia region.

Geopolitical changes and evolving regional dynamics in the Indo-Pacific region significantly influence India’s and Malaysia’s strategic positioning and bilateral ties. Specifically, the Indian Ocean’s and the South China Sea’s geopolitical importance intertwines their interests and concerns, creating a complex backdrop for their engagement.

Consequently, the diplomatic relations between India and Malaysia have experienced fluctuations, as both nations seek to uphold their respective national interests while seeking common ground on international matters.

In the realm of security and defense, India and Malaysia actively enhance collaboration to tackle shared challenges and bolster regional stability. They conduct joint military exercises, implement counterterrorism initiatives, and advance maritime security efforts. Their mutual interests in maintaining peace and security in the region drive coordinated actions to address common concerns and uphold international norms.

As a result, both parties regularly visit each other, including at the ministerial level, while trilateral service interactions and the periodic arrival of Indian Naval ships at Malaysian ports, with engagements involving the Malaysian Navy and Maritime Enforcement Agency, occur consistently.

India also provides training to Malaysian defense personnel on the Sukhoi SU 30 fighter planes and Scorpene submarines. Additionally, Indian naval ships INS Delhi participate in Malaysia’s Langkawi International Maritime and Aerospace Exhibition.

The provision of essential aid to the Malaysian search operation in the aftermath of the disappearance of Malaysian Airlines Flight MH 370 from Kuala Lumpur to Beijing on March 8, 2014, and the subsequent search in the Indian Ocean by India serve as other notable examples.

In 2015, both India and Malaysia entered into what was called an Enhanced Strategic Partnership (ESP) that aimed to elevate the bilateral relationship between the two countries across various sectors such as political, security, economic, education, socio-cultural, defense, and technical cooperation.

Both India and Malaysia have indeed joined the IPEF (Indo-Pacific Economic Framework) too. By becoming part of the IPEF, both are poised to leverage the potential to strengthen trade relations, foster investment opportunities, and bolster economic development in Indo-Pacific.

However, in the domain of political and strategic affairs, the association between India and Malaysia has been marked by an absence of distinct alignment, thus, remain neither friend nor foe. Although participating in customary joint patrols, naval exercises, port calls, and trade collaborations, these activities have not developed into a deeply strategic partnership in the true sense. Also, with respect to military hardware, its more like seller-buyer relationship.

Several factors contribute to this situation, including geopolitical considerations, historical tensions, and differing foreign policy priorities.

Foremost, both nations pursue distinct strategic alignments and interests that significantly impact their robust strategic partnership. For instance, Malaysia achieved upper-middle-income status by 1996 and showed greater interest in fostering relations with East Asian countries such as Japan and South Korea, as well as with middle powers like Saudi Arabia, rather than prioritizing the strengthening of ties with India. India’s leaders, on the other hand, primarily directed attention towards domestic matters, such as Kashmir, which necessitated collaboration with Russia.

Apparently for Malaysia, India is unequal compare to their economic standards as the economic disparity between Kuala Lumpur and India is indeed significant. Malaysia stands as a bustling metropolis with a well-developed infrastructure and a thriving economy, while India, as a diverse and vast country, faces its own set of economic challenges. On the contrary, for India, Malaysia exhibits relatively lower military capabilities, territorial expanse, and technological advancements.

The distinct strategic priorities and alliances have also led India and Malaysia to chart divergent paths. The geopolitical landscape in Asia, including the Indo-Pacific region, has led these two nations to pursue distinct paths to protect their national interests and promote regional stability.

India’s burgeoning strategic partnership with the United States since the early 2000s has propelled it to play a more assertive role in the Indo-Pacific region, amplifying its influence and shaping its foreign policy outlook. In contrast, Malaysia stresses non-alignment and actively fosters cooperative relations within the Association of Southeast Asian Nations (ASEAN) framework, reinforcing its commitment to a distinct set of strategic priorities.

These divergent approaches highlight the complex interplay of geopolitical factors and national interests that shape the foreign policies of both nations. As a result, the two countries find themselves in different camps on certain issues like Kashmir, Pakistan, and Islam, thus shaping the nuanced nature of their relationship.

Despite differing political perspectives, both nations have maintained consistent trade relations that significantly influence their interactions. They function as pivotal trade allies, and their economic interdependence fosters multifaceted cooperation in areas such as trade, investment, and technological exchange.

At the moment, India is Malaysia’s 10^th largest trading partner with a net set for $20 billion US dollars in 2023, which mainly comprised of palm oil, oils and gas, automobiles, chemicals, and finished goods. The Palm oil import was 9.79 million metric tons in 2022/23 from Malaysia.

Similarly, the Foreign Direct Investment (FDI) inflow, totaling US$1.17 billion from April 2000 to March 2023 from Malaysia, Kula Lumpur stands as the 28^th largest contributor to Indian FDI. 

On occasion, disparities in trade policies and geopolitical allegiances have exerted pressure on their economic ties too.

Spoilers

The historical legacies, cultural affinities, and ideological differences underline the complexities of the relationship and its broader strategic implications on interactions between India and Malaysia in Indo-Pacific. There are some significant spoilers that have an impact on bilateral relations.

First, the historic tensions between India and Pakistan have significantly impacted India’s perception of Malaysia’s foreign policy, particularly in relation to its approach towards Islam. Malaysia’s vocal support for Islamic unity, spearheaded by former Prime Minister Mahathir, has raised concerns in New Delhi.

The complexity of the bilateral relationship has been particularly influenced by Mahathir Mohammad’s efforts to advocate for Muslim brotherhood, which holds significant importance in this context.

Second, Malaysia’s involvement in drawing Pakistan into the ASEAN regional forum has at times deepened India’s concern, despite opposition from India. This has raised worries about Malaysian support or leniency toward Islamic separatist movements in the region.

Third, the former Malaysian Prime Minister Mahathir Mohamad’s speech at the 74th session of the United Nations General Assembly, where he accused India of “invading and occupying” Kashmir, significantly strained the relationship between the two countries.

India’s perceived lack of responsiveness to Malaysian interests regarding internal matters in Kashmir, shaped by its consideration for Islam and the Muslim community, complicates the bilateral relationship.

Particularly, the Malaysian Prime Minister’s statement on Kashmir led India to retaliate by halting the purchase of palm oil in October 2019. This in turn had significant repercussions on their economic relations.

Fourth, the perception of the rise of the Hindu nationalism in India since 2014 among the radical Malay-Muslim policy makers in Malaysia has also contributed for slowing down of robust relationship between two countries. Unfortunately, Malaysia also viewed its ethnic Indian population through the same lens. The Malaysian Indian community were perceived as not fully “loyal to the country,” but rather as “identify themselves with their countries of origin.”

Fifth, Malaysia’s stance on India’s request for the extradition of Zakir Naik, a controversial radical Islamic preacher/speaker who departed the country in 2016, has been a point of contention in the bilateral relationship. In fact, Malaysia has granted permanent residency to Naik, despite his implication in extremism and money laundering cases in India. Malaysia, as a Muslim-majority country, believes it has the sovereign right to make decisions in response to requests from other nations.

Sixth, following the 2007 ethnic Indians protest and subsequent arrests in Malaysia, there was a notable escalation in national sentiments concerning the treatment of Malaysian Indians in India. This led to a significant confrontation among Netizens, resulting in a profound impact on the bilateral relationship between the two nations. Individuals from both sides fervently expressed their opinions and emotions about the prevailing issues, placing substantial strain on the relationship. This had a modest effect on policymakers and the diplomatic relations between the two parties.

The aforementioned aspects demonstrate the complex intertwining of international relations, religious ideologies, and geopolitical factors in the relations between India and Malaysia. The established confrontational approaches have resulted in decreased interaction between the two nations, underscoring the nuanced and intricate nature of international relations, especially within the context of historical hostilities and geopolitical complexities.

Periodic contestations and unstable political partnerships between India and Malaysia significantly complicate their strategic relationship in the Indo-Pacific domain. The fluctuating nature of their interactions hinders the development of a strong and productive partnership in this critical region.

As both countries play pivotal roles in the dynamics of this area, their failure to cultivate a more reliable and cooperative engagement impacts regional stability and global geopolitics. Both nations must address these challenges and strive for a more consistent and constructive partnership in the near future to foster a more productive environment in the Indo-Pacific domain.

Prospects

India is a visible maritime power with great presence in Indo-Pacific in a decade. Contrary, Malaysia lacks a clear Indo-Pacific policy, despite the existential importance of the maritime domain to the nation. Malaysia shares maritime boundaries with all the ASEAN littoral states and faces unresolved disputes in some cases.

Malaysia may view India as a non-stakeholder in the affairs of seas beyond the Malacca Strait, but India’s rising influence and expertise in maritime security can benefit Malaysia by safeguarding the Malacca Straits from emerging non-traditional security threats in Southeast Asia.

Given the lack of a comprehensive maritime policy at the highest level to coordinate responses to diverse interests and threats within Malaysia’s maritime zones, along with limited maritime capability, Malaysia should strengthen its maritime cooperation with India in the Indo-Pacific. Through collaboration, both countries can efficiently tackle mutual maritime obstacles and enhance the stability and security of the wider Indo-Pacific region.

Importantly, both nations have a notable opportunity to engage by ensuring the protection of their maritime space and securing the vital Straits of Malacca. The region holds substantial significance as it facilitates the passage of energy resources, raw materials, and finished goods. Any disruption to these flows can significantly impact various industries and economies.

Additionally, maintaining uninterrupted and secure maritime communication routes is of utmost importance, especially given Malaysia’s presence in the South China Sea. Therefore, Malaysia must tactfully navigate its position amidst the conflicting interests of major powers in the Indo-Pacific region.

India and Malaysia can actively cultivate a pan-ASEAN (Association of Southeast Asian Nations) approach by collaborating with other ASEAN littoral states in the Straits of Malacca to tackle the issue of piracy. They could establish a multilateral pan-ASEAN security framework, such as the Combined Maritime Forces (CMF) or the Contact Group on Piracy in the Straits of Malacca (CGPSM), as a viable option.

India, particularly, given its position where it is well-placed to play a greater role and shape the maritime security architecture in the region could take initiative in the regard. Further, expanding the training program for Malaysian naval personnel, defense officers, and civilian personnel involved in maritime administration, would be worth considering. This initiative can contribute to enhancing synergy between the two parties.

India and Malaysia can actively explore technological collaboration in areas such as radar, Unmanned Ground Vehicles (UGV), and robotics. They should also strengthen defense equipment and technology cooperation through a joint initiative involving both public and private sectors to reinforce their technological ties.

Furthermore, they can seek opportunities to enhance science-based management and conservation of marine living resources, as well as to combat illegal, unregulated, and unreported (IUU) fishing in the Bay of Bengal and Indian Ocean.

With India’s expertise and skills in disaster risk management, Malaysia can significantly benefit from partnering with New Delhi on disaster preparedness and management in the region. Their collaborative efforts, such as sharing geodetic satellite data and jointly developing early warning systems for forecasting and communicating disaster-related risks and hazards, could greatly enhance their bilateral cooperation in the maritime domain.

Apart from the maritime and defense sectors, the education industry also offers significant opportunities for partnerships between India and Malaysia. This collaboration can produce long-term benefits, strengthening the partnership between the two nations. Two countries must facilitate commercial education and training programs that involve Indian education providers collaborating with Malaysian institutions and businesses. Additionally, we should encourage cooperation between medical innovation hubs in India and Malaysia, as it deserves thoughtful attention.

Finally, it is worth considering how to enhance collaboration in the Digital Economy for both India and Malaysia. Expanding collaboration in the digital economy between India and Malaysia opens significant potential for mutual growth and advancement.

By leveraging each country’s unique strengths and expertise, both nations can drive innovation, exchange knowledge, and develop their economies in the digital sphere. Embracing collaborative initiatives creates new opportunities for businesses, entrepreneurs, and practitioners in sectors such as technology, e-commerce, and digital services. New Delhi should keep in mind the importance of being sensitive to the needs and priorities of Malaysia.

Conclusion

Trade, migration, and cultural exchange have long established the foundation for interpersonal connections and mutual understanding between India and Malaysia. The two nations actively engage in a blend of collaboration and competition, along with cooperation and divergence.

Notably, the intricate nature of India-Malaysia relations forges a connection that transcends mere amicability or hostility. This complex association shapes itself through historical, political, and economic elements, resulting in a multifaceted interplay of interests and priorities for both nations.

The emergence of the Indo-Pacific region as an area of global strategic importance is prompting India and Malaysia to collaborate more closely. However, political distrust hinders their ability to cooperate strategically. Therefore, if they address each other’s sensitivities and concerns, they can strengthen their bilateral engagement in the Indo-Pacific.

Regular and constructive political engagement is essential for both countries to maintain momentum in the region. They need nuanced and astute diplomacy to navigate the complexities of their relationship, striving to balance cooperation and competition while tackling areas of divergence.

Both countries navigate the intricacies of the contemporary world order, facing numerous opportunities and challenges that demand a balanced and pragmatic approach in the Indo-Pacific. By embracing this stance, they can establish a firm groundwork for strengthening the enduring bond between India and Malaysia, paving the way for shared growth and stability in the Indo-Pacific region.

Dr. Mayilvaganan M is the Director of CHSIA and a Geopolitical and Human Security Analyst & Consultant. Ms. Nurul Aishah Ab Raman is a Lecturer at the Department of Communication, Faculty of Communication and Media Studies, Universiti Teknologi MARA (UiTM), Shah Alam, Malaysia.

Views expressed are of the authors and do not necessarily reflect the views of the CHSIA.