Sep 04, 2024 09:19 PM IST
In the wake of PM Modi’s visit, it’s time to take the ties between the countries to the next level.
If there ever was a study in contrast between two nations, India and Singapore would probably be great contenders. On size, population, GDP per capita, landmass, both countries are poles apart. And yet, the history of India-Singapore relations has been one of sustained mutual respect and trying to carve a unique space for themselves in a multipolar world.
This is the underlying spirit buoying Prime Minister (PM) Narendra Modi’s fifth visit to the island country since assuming office. For many Indians, Singapore has been an economic ideal. Today, an estimated 7.5% of Singaporean citizens are of Indian origin, with a significant additional Indian expat population working in the infotech, finance and professional services space. In fact, India is Singapore’s foremost talent partner, with a legacy of close collaboration.
The foundation of this relationship has strong historical and economic origins. In the last two decades, trade between India and Singapore has gone up by two and a half times. Today, India’s exports to Singapore stand at $12 billion with mineral fuels, chemicals and machinery products accounting for a sizeable chunk. Within the same period, Singapore’s exports to India reached new highs of $21.5 billion with a focus on consumer electronics, metals, mining and minerals and semiconductor goods.
Let’s look at two areas where Singapore can benefit India — investment and innovation. Singapore has been the largest source of foreign direct investment (FDI) into India. Bharti Airtel is one of India’s pioneering telecom majors. In 2002, as Airtel was starting out, Singapore’s SingTel took a strategic stake in it to fuel its growth. Today, Airtel is a globally leading telecom player, a testimony to this solid partnership. DBS, a leading regional bank based out of Singapore, has a network of more than 530 branches in 19 Indian states — the largest foreign bank footprint in the country. SATS Ltd, one of the world’s largest aviation services player, continues to invest in India as they opened their largest international food solutions facility in Bengaluru this year.
Both Temasek and GIC have been very active in investing in India and plan to ramp up further across sectors such as financial services, health care, infrastructure, technology and sustainability. As India aims to develop world-class infrastructure and urban planning, it can look to Singapore’s deep experience on urban development for investment and inspiration. Singapore has presence in advanced manufacturing capabilities that can benefit India.
On the other hand, there are at least three areas where India has much to offer Singapore — health care, green energy and tourism. As the city-state makes the push towards Healthier SG, a national initiative focused on preventive health, it can leverage India for well-qualified, well-motivated health care professionals, in particular nurses. The domestic impetus to cater to the health care needs of billions has accelerated innovation in the sector, with India well-poised to take a technology-backed leapfrog. This could benefit Singapore in the form of low-cost, high-quality diagnostics as well as medical tourism opportunities. India has sizeable potential as a green energy source for Singapore in the future. Apart from selling renewable electricity directly, there are also other energy sources which India can export, through hydrogen or ammonia. Tourism is another significant link which holds promise. So far in 2024, over 2.4 million Indians visited Singapore. However, there is massive potential in the other direction as well since Singaporeans might find India’s natural beauty and vibrant culture an enticing draw for their vacations.
Finally, let’s expand this thinking further into two areas of mutual benefit to both nations — connection to Southeast Asia (SEA) and talent exchange. India-Singapore relationships are an integral part of India’s broader relationships with Southeast Asia. Nations in the SEA region are forging alliances on digital economy, intra-regional trade and tourism, where India can be a strategic ally. For example, Singapore and India have linked their respective digital payment systems, India’s Unified Payments Interface and Singapore’s PayNow. There is potential for this to grow into a regional instant payment system across SEA, facilitating seamless trade. There is significant scope for knowledge sharing through talent exchange between India and Singapore, obviously leveraging India’s deep technical talent but also targeted collaborations between high-quality higher education institutions on both sides. Enterprise Singapore, a key government entity helping Singaporean companies expand overseas, enables bilateral exchange in areas including innovation, digital solutions, urban solutions and cross-border technology development.
2025 will mark the 60th anniversary of diplomatic relations between India and Singapore. In the wake of PM Modi’s visit, it’s time to take the ties between the countries to the next level. Earlier this year, when Singaporean PM Lawrence Wong assumed office, he spoke about Forward Singapore, his vision for “a refreshed Singapore Dream”, to outline the next chapter of the Singapore story. Simultaneously, India is working towards the goal of Viksit Bharat — a vision to become a developed country by 2047, when it marks 100 years of independence. Both countries have ambitious goals set by visionary leaders. Both also aspire to play a significant role and cast standout influence across a multipolar global order beset by geopolitical fractures. It is therefore to the advantage of both nations to strengthen this partnership as they chase their individual and collective aspirations.
Neeraj Aggarwal is chair, Asia Pacific, The Boston Consulting Group (BCG). He is Indian and leads BCG’s Asia Pacific business. Aparna Bharadwaj leads BCG’s Global Advantage practice. She is a Singaporean of Indian-origin. The views expressed are personal
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