Junichiro Koizumi led his Liberal Democratic Party (LDP) to a decisive victory in the 11 September elections to the Japanese Diet's Lower House. The Japanese public rewarded Koizumi's risk-taking and party purges by giving their Prime Minister a huge mandate in an election that revolved around the single issue of postal privatization.

However, the domestic implications go much further than just postal reform. Koizumi is also intent on centralizing power and strengthening Japan's political elite at the expense of the bureaucracy - fundamentally altering the system left in place by the American occupation. Political polarization is increasingly evident, and while the demise of the LDP is probably not part of Koizumi's plans, a permanent end to one-party rule and predictable politics in East Asia's oldest democracy seems more likely now.

Equally important, Koizumi's mandate allows him to set his stamp on a matter that received little attention during the elections - foreign policy. Indeed, the postal privatization plan is expected to see fruition only in 2017, but Koizumi's foreign policy might well be what he will be remembered for. Under Koizumi, Japan has begun to embrace nationalism and overseas military engagements without looking over its shoulder. He has sought to convey a message both domestically and externally by his visits to Yasukuni.

It is not a coincidence that Japan's economy is beginning to show signs of recovery under Koizumi's proactive foreign policy and remilitarization. The latter is worrisome in a region with long memories, but Japan is at a stage where it needs to buttress economic prowess with political and military weight. A rising China gives added impetus and, in fact, goes some way towards alleviating concerns over Japan. Southeast Asia, for example, now tends to look more benignly at Japan's "normalizing" activity. The perception that Koizumi has increasingly alienated the rest of East Asia over time must be juxtaposed against this facet of Asian politics.

True, the Koreas are still as unforgiving and China has made a major occasion of the sixtieth anniversary of the Japanese defeat. But while historical details continue to be disputed, as seen in the textbook controversy, Koizumi's apologies have also acknowledged the "colonial" nature of Japan's empire building and included a commitment to "never engage[e] in war". Koizumi's Japan seems to be conveying the message that it has paid its dues and will no longer take its past as a self-imposed limit on its future course of action. China and South Korea also need to take a more positive look at the fact that Koizumi took a risk, despite an election looming, of not visiting the Yasukuni on 15 August this year, commemorating the end of WW II. Some commentators have said that this only showed that Koizumi wanted to keep the focus on domestic issues. However, it also appears to suggest that Koizumi has gone beyond using history as a prod to nationalism, as in the rest of the region. He must realize that a Japan that needs to keep looking at its past can in no significant way define its future.

The Chinese and the Koreans need to realize this too. Japan's years of economic stagnation have seen it take on a sort of siege mentality, while China has been gaining in confidence over the corresponding years. Ironically, China's rise has now stimulated Japan. In addition, since their economic relationship will continue to grow, China still has the opportunity to be a positive influence. For that it must abandon, the strident tone it adopts towards Japan's external policy and internal affairs.

There are after all pitfalls to an overly aggressive posture towards Japan. China is no longer the largest recipient of Japanese ODA, and Koizumi's closeness to the US, for example, has made matters all the more difficult for the South Koreans as they struggle to manage their own rocky relationship with the Americans. Moreover, whether its neighbours like it or not, changes to Japan's pacifist constitution will now be made, sooner than later.

The US, too, for its part, risks underestimating the new rise of Japan. The strong pro-US tilt of the Koizumi administration is no pointer to the future. The Japanese are disappointed in the American reluctance to promote UN Security Council reforms. Further, the American vision for Japan is still limited to the latter playing second fiddle. Moreover, Japan might develop considerably bigger ambitions than that.

Where India is concerned, it is about time it stopped looking at Japan through American glasses. It has long been a complaint in Indian strategic circles that the Japanese have always ignored India, in political and strategic terms. Over the last couple of years, however, there has been a heightened Japanese interest in India. It is inevitable that Koizumi and his successors will make greater investments in the relationship with India, and not just economically. It would not do for India to be caught napping when an assertive Japan comes looking for a closer all-round partnership. The advantages are huge. Is India prepared to seize its chances, let alone take the initiative?