Deputy Prime Minister Heng Swee Keat, Patron, Institute of South Asian Studies (ISAS)

Emeritus Senior Minister Goh Chok Tong, Founding Patron, ISAS

Professor Tan Tai Yong, Chairman, ISAS

Associate Professor Iqbal Singh Sevea, Director, ISAS

Excellencies, Distinguished Guests, Ladies and Gentlemen

1. It is truly a pleasure to join you this evening to celebrate the 20^th anniversary of the Institute of South Asian Studies (ISAS) at the National University of Singapore.

2. It is wonderful to see so many scholars of the region, corporate leaders and community leaders gathered together for the occasion.

ISAS: Catalysing engagement with South Asia

3. When then-Senior Minister Goh Chok Tong launched ISAS twenty years ago, he spoke of developing deeper knowledge and expertise on South Asia as a strategic imperative for Singapore.

4. ISAS has done well since then – not only in bridging the deficits in knowledge that existed, but in advancing independent research and thinking on South Asia. It has also served as a bridge between South Asia and Southeast Asia. ISAS’ symposiums, roundtables, conferences, dialogues and workshops, have helped to build fruitful intellectual and institutional partnerships.

5. I am glad that ISAS has also actively involved Singaporean students in internship programmes and student exchange programmes, and is exploring the possibility of post-graduate programmes on South Asia.

6. Two ISAS initiatives are noteworthy for their long history:

a. The first is the annual India-Singapore Strategic Dialogue, or ISSD, in its 15^th rendition this year. The ISSD is a Track 1.5 dialogue, to use the diplomatic parlance, bringing together a range of stakeholders with an interest in furthering the Singapore-India relationship. It has been an effective platform for shaping ideas, and engaging on the way forward for India and Singapore.

b. The second initiative is ISAS’ South Asian Diaspora Convention. It has brought together regional policymakers, business leaders, academics and civil society leaders, to discuss issues such as infrastructure, women empowerment, fintech, and opportunities and challenges in South Asia.

Singapore-India relations on an upward trajectory

7. Let me say a few words now about the bilateral relationship between Singapore and India. I am optimistic about the relationship. We should be able to build greater depth and breadth in our relations with India in the coming years.

8. India has elected a new government following its General Elections last month. We have congratulated Prime Minister Modi for winning a third term, which is a remarkable feat in a massive, robust and in many ways decentralised democracy.

9. It speaks to how millions of people have seen their lives uplifted, especially by gaining the basic amenities and services that had eluded them for decades. It also reflects an awareness of India’s rise, it is becoming the fastest growing and most promising large economy in the world.

10. We can expect broad continuity in India’s domestic and foreign policies. Certainly, we should expect our bilateral relations, which are deep and enduring, to remain on an upward trajectory.

• We have seen extensive investments by Singapore investors in India in recent years and growing interactions between our business communities, and the mood remains bullish.
• Our two governments are also working closely on issues such as food security, energy and the green economy, digitalisation, and skills development, including the training and recruitment of nurses from Northeast India.

11. Beyond our bilateral relations, let me offer a few broader thoughts about how India and Southeast Asia respond to new global economic and geopolitical realities. 

i) India and Southeast Asia: creating opportunity, equity and sustainability

12. First, I believe both India and Southeast Asia are poised to create a new era of opportunity, equity, and sustainability.

13. We are both well positioned to do so for two reasons. First, we are not caught at the sharp edges of the largest geopolitical conflicts of the times.  You would not find us at either pole of any of the major tensions that we see in the world today.

14. Second, we have societies that are still looking upward. That’s a little rare in the world today –where the majority of people, ordinary people, hope to see a major uplift in their lives and see a chance of achieving it.

15. We have to make the most of this positioning of the two regions in the decade ahead.  We have to respond to new global realities, but also seek to shape it – to shape it in ways that secure each of our national interests and the global good at the same time.

16. India and Southeast Asia do have agency – particularly if we respond with same broad orientations. Remember, we together make up over a quarter of the world’s population, 15% of the world’s GDP, and are the fastest growing regions in the world.

17. We can and must use this agency wisely. I believe we can do so by adopting a few strategic orientations:

• By thinking long term, rather than responding to the geopolitics of the day or, as has happened in many countries, to the domestic mood of the moment.
• By investing more actively to grow human potential.
• By resisting further global economic fragmentation, which will ultimately hurt every nation.
• By collaborating to slow climate change and halt the deterioration in the planet’s ecology, in all our interests.

18. I believe these strategies, pursued with vigour, give us the best chance of securing our national interests and the global good at the same time.

ii)  Responding to the global drift towards interventionist industrial policies

19. Let me go on to a second issue, which concerns the implications of the shift towards interventionist industrial policies, especially in the major economies. Industrial interventionism is seeing a resurgence across the globe not seen since the 1960s and 1970s, when it had largely failed.

20. The shift is taking place largely by way of drift, and tit-for-tat actions. It is not a confident resetting of policy, informed by powerful new evidence, or by a cogent reappraisal of the economics of prosperity.

21. But the new industrial interventionism is nevertheless creating a new global reality – an unstable competition of industrial subsidies, and a shifting but unpredictable geometry of trade and investments. In other words, it is both a reaction to heightened geopolitical contestation, and a further source of weakening in the global economic order.

22. Let me make three observations on how we respond to this global trend, in both our regions.

23. First, industrial policies should be focused on upgrading our capabilities, rather than crowding out other countries. We have to remind ourselves that innovation remains the fundamental driver of long-term growth. We either spur innovation through a competition of capabilities, or stifle innovation by cutting out the competition.

• The IMF has found of the 2500 industrial policy interventions last year, over two-thirds were intended to discriminate against foreign interests.
• We cannot go far wrong with industrial policies that focus on developing our capabilities – through both economy-wide policies such as investment in basic R&D and education, or cluster-based strategies to develop deep applied strengths and synergies between firms.
• And we will also find that economic performance is aided by adopting and adapting the best technologies and innovations, regardless of where they come from. In reality, they often go hand in hand with developing national capabilities.

24. A second observation. For industrial policy to succeed, we need social policy on an industrial scale. To develop every human talent, to deepen and upgrade skills continually, and to advance social mobility. It requires new forms of collaboration, between the public sector, enterprises, unions and community organisations, and educational and training institutions. This is itself a large-scale and complex endeavour, but is too often neglected in the rush to implement industrial policy in its narrow definition.

25. There is also an important nexus to be achieved here. Investments in social inclusivity are critical to keeping intact the political consensus needed for open economic and industrial policies. And that economic, social and political nexus is what helps us achieve our long-term goals of good jobs and shared prosperity. They go together, or they each fall apart.

26. Thirdly, there is potential for India, Southeast Asia, and other responsible middle powers to work collectively to build resilience in multilateralism, regionalism, and coalitions to tackle cross-cutting global issues.

27. I am glad, for example, to see India’s leadership in establishing the International Solar Alliance, which Singapore has joined and actively supported. Even though coalitions like these are not universal in membership, they help to create momentum in the direction of multilateralism, an arrangement that while never perfect and always frustrating in its processes, has served nations rich and poor well for the last few decades.

28. A concluding concern. The new industrial interventionism has found favour amongst politicians, but many economists as well.

29. We should guard against the reverse of John Maynard Keynes dictum, on politicians, who despite believing they are exempt of intellectual influences, were “usually the slaves of some defunct economists”.

30. The equal danger we run today is of economists and commentators, not least those in the advanced economies, despite protestations of independence, being in the service of the political temper of the times. 

31. I am sure ISAS will continue to bring outstanding minds from India, Southeast Asia, and others in East Asia, to help advance honest thinking on our long term interests, and to help build robust  partnerships in a troubled world.

32. I wish you all success in this important endeavour.