India has overtaken Japan to become the third most powerful country in Asia, marking a significant shift in the 2024 Asia Power Index released by the Australian think tank, Lowy Institute. This is the first time since the index’s inception in 2018 that Japan has fallen to fourth place, indicating changes in the region’s balance of power and reflecting Japan’s economic decline and India’s growing influence.
The Asia Power Index, an annual report that ranks 27 countries and territories in terms of their power, influence, and capabilities, assesses nations based on factors such as economic strength, military capability, diplomatic influence, and cultural power. In this year’s report, the United States remained the most dominant power in the region, followed by China. However, China has closed the gap with the U.S. and was judged by experts to be better positioned to deploy military power rapidly in case of an interstate conflict in Asia.
Despite China’s military gains, its overall influence has stagnated due to a slowing economy and demographic challenges. The report noted that China’s power is “plateauing” at a level below that of the United States but remains well above any Asian competitors. It also emphasized that the U.S. still leads China in six out of the eight measures of power, underscoring its sustained influence in the region.
Japan’s fall to fourth place was attributed to economic challenges and increasing competition in areas where it once held technological and manufacturing advantages. According to the Lowy Institute report, Japan’s economic clout has waned due to “redirected foreign investment away from the Japanese technology sector” and the erosion of its edge in advanced manufacturing, primarily due to competition from countries like South Korea, China, and Taiwan.
However, Japan’s role in regional defense and security has grown, with the report noting increased collaboration with allies like the United States. Tokyo has shown a more proactive stance in regional security matters, including signing a Reciprocal Access Agreement with the Philippines and strengthening ties with Australia and South Korea.
In contrast, India’s rise to third place in the rankings is driven by its significant economic growth and potential. The report highlights India’s vast resources, including its large population, landmass, and economy, which is now the third largest in the world in terms of purchasing power parity (PPP). Although India’s influence remains below what its resources suggest, the Lowy Institute notes that India has the potential for substantial growth as a major power in the coming years.
Russia’s influence in Asia has significantly declined, falling to sixth place behind Australia, largely due to the fallout from its invasion of Ukraine.
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