Editor's Note: This assessment is part of a series of analyses supporting Stratfor's upcoming 2019 Annual Forecast. These assessments are designed to provide more context and in-depth analysis on key developments in the coming year.
Throughout most of India's history, its rulers have emphasized land forces over sea power. Their domains were faced with the persistent threat of invasion from the northwest as well as the specter of internal strife. But the European colonial invasions by sea provided a rude awakening, and in the immediate aftermath of independence, New Delhi focused on the need for a powerful navy. However, conflict with Pakistan, internal dissent and border clashes with China reinforced the need for powerful ground forces. And China isn't just testing India on the land; it is also pushing into the Indian Ocean. To meet this challenge, India is strengthening its navy while maximizing its strategic thinking.
With half of the world's traffic for container shipments and 70 percent of its oil traffic, the Indian Ocean is only increasing in importance as great powers such as China seek to gain influence in the region. India, as the resident power, is racing to assert its dominance in its home ocean by expanding its capabilities in the area and seeking influence outside of it.
The Growing Importance of the Navy
While the army remains a higher priority in India, the navy is gaining in importance for several reasons. The country's agricultural abundance and other resources once meant that maritime commerce was a supplemental activity, and not a necessary one. Now, India's trade and commerce are critically dependent on open maritime routes. Its international trade is mostly sea-based — more than 90 percent by volume and more than 70 percent by value — showing how crucial access to the high seas is.
Also, India is enhancing the survivability of its nuclear deterrent by investing more in the sea-based leg of its nuclear triad. Earlier this month it announced that its first domestically built nuclear ballistic missile submarine, of the Arihant class, had completed its first deterrence patrol. The completion of this patrol put India among a select few nations (the United States, France, the United Kingdom and Russia) that have achieved this. However, for this sea-based nuclear deterrent strategy to work effectively, nuclear ballistic missile submarines are not enough; the conventional navy must secure key areas for the Arihant class submarines to operate.
Finally, China has become more active in the Indian Ocean over the past decade, dispatching a growing number of surface warships and submarines to the region. It has gained docking rights and established firmer ties with a number of countries in the area, and it has even secured an important base in Djibouti, on the Horn of Africa. These moves have forced India to expand its traditional mission of containing the Pakistani navy in the Arabian Sea to one where it asserts its dominance over the much larger Indian Ocean to counter Chinese incursions.
The strategy for this expanded mission is all the more resource-intensive because the Indian navy's mandate is to pursue "sea control" and not just "sea denial." In other words, India needs to be able to safeguard its merchant fleets and the freedom of navigation throughout the region, as well as deny its enemies access to the Indian Ocean for trade. To do both, India has to maintain a large naval force to patrol for any potential threats; the mission also drives the navy toward the expensive ships and aircraft that are particularly effective at covering wide areas of the ocean, such as aircraft carriers with their planes and helicopters. India has had carriers since the early 1960s, and the navy's growing responsibility shows the need for such large investments.
Big Ambitions, Little Cash
The problem for India, however, is that its high seas ambitions may be more than it can afford, especially in light of other security needs. The standoff with Pakistan over Kashmir and other areas is far from resolved, internal insurgencies continue to rage in parts of India, and China is also a powerful adversary on land, as India and China's 2017 dispute over the Line of Actual Control high in the Himalayas showed. So there are plenty of other security distractions that prevent a revolutionary redistribution of resources from the other branches of the Indian armed forces to the navy.
And even when grand funding plans are approved, the money isn't always forthcoming. The navy's 15-year modernization plan, for instance, is already fraying. It was supposed to receive about $8.5 billion a year from 2015 to 2030 to buy new vessels and to ensure a greater focus on indigenous manufacturing of equipment. However, in 2017, the navy received only $3 billion, and 90 percent of that money was allocated for previously signed contracts, and not for new purchases. The navy's goal of increasing its fleet inventory from 140 warships to 198 by 2027 is in all likelihood unachievable. Moreover, it is highly unlikely that India will be able to significantly shake off its dependence on foreign imports, which make up about 70 percent of its navy today. Despite this underfunding, the Indian navy has made significant progress in building up a relatively powerful surface fleet and deploying a considerable number of maritime patrol aircraft. But key deficiencies continue to plague the service; it lacks helicopters and submarines, and it has a worrisome rate of accidents.
All these constraints are forcing New Delhi to think even more strategically about its approach to the Indian Ocean. In particular, India is seeking to build up its power in four key areas and use them to its advantage in the region. First, it must compete with China for influence in various Indian Ocean states such as Sri Lanka, the Maldives, Mauritius and the Seychelles. Strengthening its position with these countries not only would deny China key operating space that is often astride critical maritime commercial routes, but it also could bolster India's ability to promote its interests.
Second, India is strengthening its military infrastructure on some of its strategically positioned territory in the Indian Ocean, particularly the Andaman and Nicobar islands. These islands offer a key vantage point on maritime traffic heading into and out of the critical Strait of Malacca. Recognizing their importance, India has extended its airfields to allow access for larger maritime patrol aircraft, set up ammunition dumps and extended docking facilities to accommodate large warships.
Third, New Delhi has recognized the important benefits stemming from a closer cooperation with the United States in the Indian Ocean. At the same time, India remains keen to avoid any step that would lock it into a wider U.S. alliance against China. For instance, it has signed a Communications Compatibility and Security Agreement with the United States, which is an important accord that paves the way for further interoperability between Indian and U.S. armed forces. India has also been conducting large-scale naval exercises with the United States in the Indian Ocean, particularly the annual Malabar exercises. Through this cooperation, India has acquired high-tech equipment such as P-8 Poseidon maritime patrol aircraft and is set to receive technological assistance including possible help with its next aircraft carrier program. It has also gained key operating knowledge from its exercises with the U.S. Navy, as well as access to better information on Chinese naval movements in the region through a military intelligence-sharing agreement with Washington.
Finally, India is looking to counter Chinese activities in the Indian Ocean by building up its influence in China's backyard, particularly in the South China Sea area. Its activities there are not new, as shown by its "Look East" policy, which evolved into its "Act East" policy in 2014. India has faced some real limits in turning its efforts in Southeast Asia into major gains, and its physical presence in the South China Sea is far from matching China's presence in the Indian Ocean. Nevertheless, there are still some bright spots for New Delhi in the region: Considerable progress has been made with Taiwan, and a deepening relationship with Vietnam includes substantial military cooperation.
Looking ahead, India can expect China to continue its naval forays and activities in the Indian Ocean. India, whose navy is limited by underfunding and stretched by a broad mission, will look for strategic advantages by reaching out to its island neighbors and the United States while strengthening the military facilities on its well-placed island territories. While New Delhi can't match China's heavy investment in its navy, it can look for every competitive edge in the race for dominance over the Indian Ocean.