Why does Malaysia resist India's APEC entry?

Why does Malaysia resist India’s APEC entry?

Why Malaysian Indians are unhappy

Aditi Phadnis / New Delhi December 07, 2007

When senior Malaysian cabinet minister for 28 years and leader of the ‘official’ ethnic Indian party the Malaysian Indian Congress (MIC), S Sami Vellu, cancelled his Diwali party this year, the government of Malaysia should have sensed something was off kilter.

MIC internally debated the appropriateness of a Diwali celebration against the background of the demolition of several Hindu temples in the country. Malaysians of Indian origin were angry and they wanted to show this.

What no one expected, possibly not even the Malaysian government, was the ferocity of the rage. Used to the sedate pace of protest by the MIC — which Vellu has headed without a break since 1979— demonstrations by volunteers from the new kid on the block, HINDRAF (Hindu Rights Action Force), were as much an expression of resentment at the lack of internal democracy in MIC as they were against institutional ethnic discrimination against Malaysians of Indian origin.

Because the Malaysian ruling class is a coalition of races, the government expected MIC to speak for the Indian community. Loud and vociferous protests by HINDRAF unnerved it, which resulted in the use of disproportionate force to suppress it, observers say. Indians of Malay origin consider India their country and expected that it would speak up for the Indians.

Sensing an Indian lobby in its political establishment, from time-to-time, Malaysia likes to assert itself vis-a-vis India, especially in the trade arena.

India’s entry in Asia Pacific Economic Cooperation (APEC) continue to be resisted by Malaysia on the grounds that APEC should be regionally rigorous, though Peru is already a member.

Malaysia, which is the coordinating country for the ASEAN-India FTA, is another spoiler in the process. When Indian representatives insisted on keeping palm oil, which constitutes over 60 per cent of Malaysia’s exports to India, on its sensitive list to protect Indian soya bean producers, the Malaysian government declared that FTA negotiations have come to a halt.

Concluded. The first part of this article appeared on December 6 (appended).

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Divide between India and Malaysia deepens

Aditi Phadnis & Anirban Chowdhury / New Delhi December 06, 2007


A week is not even a punctuation mark in the history of nations. But how rapidly relations between India and Malaysia have deteriorated in the past week in the wake of crackdown on ethnic Indians in Malaysia can be judged from the fact that air ticket sales to Malaysia have declined by between 5 and 10 per cent in the last seven days.

Holiday package sales from India have dipped. Some customers have opted not even to stop in Malaysia in transit and have opted to reroute their flights or choose direct flights to their destinations.

“Last week, a lot of people who had bought air tickets or holiday packages to Malaysia opted for other destinations like Bangkok, Hongkong and Singapore,” said Subhash Goyal, owner of Stic Travels.

Malaysia is a hub not just for the rest of Southeast Asia but also the West. Malaysian Airlines has connecting flights to Bangkok, Hong Kong, Tokyo and even destinations in the US and Australia.

“Since people are going for a holiday, they want to enjoy themselves in peace and quiet. Ongoing problems in Malaysia could affect their choice to some extent,” said Ajay Prasad, general secretary, Travel Agents Federation of India.

Last week, the government of Malaysia used water cannons and disproportionate force against a group of 10,000 protesting Malaysians of Indian origin who have been agitating against institutional discrimination.

That the protest found resonance in India —Tamil Nadu Chief Minister M Karunanidhi asked the Indian government to intervene — angered the Malaysian ruling elite and more than one minister commented that the Indians had it coming to them.

How much history Malaysia and India share is clear from the following:

• 8 per cent of the Malaysian population is of Indian origin, of which 90 per cent is Tamil-speaking. Both countries are former British colonies.
• Indian tourist traffic, which accounts for a large chunk of Malaysia’s tourism -generated revenue, grew by 59 per cent to 285,478 as on August this year.
• Agricultural commodities like potato form a major item of export from India to Malaysia.
• The Malaysian national car company, Proton, is seeking to enter India at a time when globally there is no other market for automobiles.
• Several Malaysian companies have bid for highway construction as part of the highways development programme.

“Malaysia has no markets for the goods it produces. It used to export to China, but China is buying less and less from them. India is the only well developed market for Malaysian goods and services, including tourism,” said a diplomat.

“Ethnic problems in Malaysia are largely internal,” said a top Foreign Office official, “but we are concerned about the situation of Indians there. And we are also concerned about the repercussions.”
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