India is a non-claimant to the South China Sea Islands, but it is concerned with the development in the South China Sea. The disputes in this Sea involve China along with several states in the region and encompass issues like overlapping territorial claims and access to critical resources like energy and fisheries. Within this turbulent environment, India has been expanding its influence over the littoral states through its Look East Policy (LEP).
The South China Sea is located strategically for India's interests. Geographically it connects the Indian Ocean and the East China Sea via the Malacca Straits. This important waterway serves as a vital economic artery for India, as India's total international trade volume is sea-berne, half of which passes through these straits.
India has trading relations with many South East and East Asian economies. If in future, China gains control of the Sea and shuts all passage that way, it can disrupt trade between India and its partners. This might force India to re-route the transit of its exports. This can lead to a great increase in transportation cost and thus can prove to be a threat to India's competitiveness. To balance this and maintain cordial relations with other countries, India will have to extend its trade agreements. It might have to provide increasing access to its markets which will make India more dependable and vulnerable.
As South East Asia and its contested littorals matter to Indian interests in the form of trade and economic linkages in the Pacific they are becoming stronger and deeper. The 'Act East' policy targets ASEAN, the far eastern Pacific and Asia's Eastern countries which are a vital facilitator of India's economic development.
Energy is another component of India's interests in the South China Sea. Besides being a rich source of fish and marine life, the South China Sea holds significant quantities of oil and gas at around 11 billion barrels of oil and 190 trillion cubic feet of natural gas as estimated by Energy Information Administration (EIA) of the US, making it a potential huge energy resource for energy scarce growing economies like China and India. India is an energy deficit country and its energy consumption is projected to increase within the next two decades. This crucial need has compelled India to accept Vietnam's invitation to explore oil and gas in the contested waters of the South China Sea in 2011.
India is also investing in hydrocarbon assets in whatever form and quantity available. These assets are maintained by sea and use sea lanes for repatriation to India. And for that matter, there is no way that India would retreat from the South China Sea just because China or any other country has taken an exception to its economic and naval activities in this region.
India also has well embedded maritime interests in the region. India's involvement in the South China Sea focuses: to ensure peace and stability in the region and keep the vital sea lanes open: to maintain cordial relations with regional powers: to ensure that no potentially aggressive external power comes to dominate the region. And through the 'Look East' policy India has been pursuing these objectives by intensifying its engagement with ASEAN states. Besides increased economic engagement, strategic cooperation has also been expanded through operations such as humanitarian assistance and disaster relief, as well as joint naval exercises and port calls since 1990 by the maritime operations of the Indian Navy. Military training and sales of military hardware with regional states like, Singapore, Indonesia, the Philippines and Vietnam are also being carried out by India.
India believes that the disputes in the South East Asian littorals are a litmus test for international maritime law. In the aftermath of the Hague Tribunal verdict on the South China Sea, India feels obligated to take a principled stand on the issue of freedom of navigation and commercial access as enshrined in the UNCLOS.
Other factors that compel India to play a major role in the South China Sea dispute are: In the wake of weakening American alliance in Asia, US wants India to play a role in regional security issues such as the South China Sea dispute; China's ever growing ambitions has chilling effect on India's security architecture and India likes to counter China by getting involved in the South China Sea dispute; There is global maritime security involved in the region and many nations want India to balance the assertive and rising China and like it to get involved in the dispute to maintain peace and security in the region; India having a voice in a major regional security issue confers its prestige that commensurate with its regional power status. This has necessitated India to get involved in shaping the security of the Indo-Pacific region; India as a neutral observer can assert its weight on the region in partnership with several other nations to resolve the South China Sea dispute.
And, with the expansion of Chinese maritime activities in the Indian Ocean Region, India fears a rise in non-grey hull presence in the Eastern Indian Ocean. The possibility that China might eclipse India in its own 'backyard' will continue to drive a security response in India, even as it seeks to strengthen the Indian naval presence in its near and extended waters.