In the year 2007, India and Malaysia commemorate fifty years of their diplomatic relations. It has, however, been a rather subdued relationship. Malaysia, an influential player in the ASEAN and the facilitator of the India-ASEAN FTA, is important for India, particularly for ensuring deeper penetration within the ASEAN inner circle, that is the ASEAN+3 group.

Malaysia is close to China, given the economic opportunities it provides, and to Pakistan, considering the Islamic brotherhood factor. Consequently, should India hesitate in establishing strong ties with Malaysia? Presently, Malaysia recognizes India as a new player in the ASEAN. The earlier impression of India as a "nation of unfulfilled greatness" has been discarded and its emerging global geopolitical power is being emphasized. In 2005, the Malaysian Prime Minister, Abdullah Badawi, remarked that, "India is indeed a stirring economic giant whose time has come." However, Malaysia dismisses notions of India as a countervailing force to China and repudiates any attempt to aggravate China. Therefore, the need of the hour is "Engaging Malaysia" particularly in the maturing phase of India's Look East Policy. India needs to play a balancing act, by projecting itself not as an alternative to China but rather as another valued partner, an association with whom will bring mutual benefits.

There are several issues that highlight the magnitude of India-Malaysia relations. Trade and investment form the crux of India-Malaysia ties that have glued together their otherwise lukewarm relationship. In 2006, India-Malaysia trade stood at US$5.7 billion, an increase of 21.59 per cent from the previous year. For India, Malaysia is an attractive source of investment - Malaysia is the 18th largest investor in India - and a matured market as it is the second-most developed economy in the ASEAN. Meanwhile, India's huge market with a 300-million strong middle class is an irresistible attraction for Malaysian manufacturing and services. Presently, there are 61 Indian joint ventures in sectors ranging from palm oil refining, power, railways, civil engineering construction, and Information Technology (IT). 67 Indian IT companies enjoy Multimedia Super Corridor (MSC) status in Malaysia. There are also some 20 other Indian companies in various manufacturing sectors.

Malaysia is one of the world's leading exporters of LNG and India is the world's sixth largest energy consumer. In addition, the partnership between Malaysia's Petronas and the Indian Oil Corporation, flight-linkages, tourism and education are other key revenue-generating collaborative sectors for both the countries.

Defence is another area where cooperation is evident albeit intermittently. India has provided training to Malaysia's Air Force pilots on MIG-29s in the past and has offered training also on the Sukhoi and the Scorpene. India has also helped Malaysia in building up its coast guard. Maritime cooperation between India and Malaysia is still restricted. Although Indian naval ships frequently visit Malaysian ports, cooperation with regard to capacity-building and patrolling piracy-infested areas or jointly facing non-traditional threats at sea like drug-trafficking, human-trafficking and possible maritime terrorism remains inadequate. India has a strong navy with technological superiority that can be seriously explored at Malaysia's end. Frequent joint naval exercises similar to India-Singapore exercises and deeper cooperation in training and exchanging defence personnel could form additional and viable confidence-building measures. Indian missile technology, radar systems, defence component systems and supporting hardware are again areas where both countries can work in partnership.

Technological collaboration is another driving force. India's superiority in software, biotechnology, telecommunications, genomics, and space technology can be of enormous value to Malaysia, while Malaysia's vast experience in state-of-the-art Information and Communication Technology infrastructure and agro-based industries as well as its successful nurturing of tourism can be treasured learning experiences for India.

The Indian Diaspora is a determining factor in any study of India-Malaysia bilateral relations since Malaysia is home to a very large number of ethnic Indians outside the Indian subcontinent. This has hitherto dampened bilateral relations primarily because of the ill-treatment meted out to the ethnic Indians in Malaysia. India has so far chosen to stay silent in the interest of non-interference in Malaysia's domestic affairs; this policy option, however, is no longer constructive because if Malaysian Indians are properly treated then they would not only be a valuable asset to their adopted country but a potential source of investors for India as well.

Finally, Malaysia and India are natural partners given their historical past and commitment to international forums like the UN, the Non-Aligned Movement, the Commonwealth and South-South groupings like the G-77. Both are nascent economies with vulnerable domestic players. Therefore, their convergence in foreign policy should be highlighted to devise a common stand at the WTO. Cooperation between the two countries over international issues would thus strengthen a leadership role for the developing world.

In conclusion, in the present world where atrocities and religious fanaticism are gaining ground, Malaysia as a prominent member of the Organization of the Islamic Conference, and India, with the second-largest Muslim population in the world can together restrain the spread of extremism and constructively engage in bridging the gap between the Muslim world and the West.