TOKYO AT A CROSSROADS
Tokyo at a crossroads
Following the departure of Japan’s beleaguered PM Fumio Kishida, Yvonne Gill assesses the impact on the country and, more broadly, on Indo-Pacific geopolitics
Caught in the quagmire of a campaign slush funds scandal involving members of the ruling party, rising inflation and his party’s links to the Unification Church, an extremist religious cult, Japanese Prime Minister Fumio Kishida’s decision to step down and not seek re-election in the country’s October 2025 poll has sent ripples of uncertainty across the globe. Policy-makers from Washington to Seoul and New Delhi to Canberra are now assessing the geopolitical ramifications of Kishida’s departure.
A new leader, elected by the Liberal Democratic Party (LDP), will take over as prime minister in September.
Since his ascent to the premiership three years ago, Kishida has survived one crisis after another. A string of recent electoral setbacks in local elections saw his approval ratings plummet to as low as 18 per cent. Kishida said he is stepping down to help the LDP regain the confidence of the people. The outcome of the party’s upcoming leadership election will have far-reaching consequences for Japan’s role in the Indo-Pacific region and its relationships with allies and rivals alike.
The LDP leadership contest is shaping up to become one of the most unpredictable races witnessed in recent memory. The dissolution of traditional LDP factions in the wake of the slush funds scandal has upset power dynamics within the party. Those vying for the top job are: hawkish former Defence Minister Shigeru Ishiba; Digital Minister Taro Kono, a popular politician with a reformist bent; and Economic Security Minister Sanae Takaichi, who could, if elected, become Japan’s first female prime minister.
Whoever is elected, the new leader will inherit a host of economic challenges, including a weakened yen and the urgent need to balance the increased defence spending with sustainable growth. Kishida’s ‘new capitalism’ agenda, which aimed to address wealth inequality, has largely remained a pipedream. The next prime minister will have to chart out effective policies to reinvigorate Japan’s economy. The demographic conundrum of an ageing population and low birth rates is another area of concern.
Kishida pursued an aggressive foreign policy, placing emphasis on a Free and Open Indo-Pacific (FOIP). He stood in defence of a liberal international order and wanted Japan to play a pivotal role in the East and South China Seas, and the Indo-Pacific in general. His tenure saw a strengthening of Japan’s alliances with key partners such as the United States Australia, India and even South Korea, in order to challenge China’s growing aggressiveness in the region.
The LDP leadership contest is shaping up to become one of the most unpredictable races in recent memory
Now, the US-Japan alliance could face a period of recalibration as both countries prepare for potential leadership changes. How, people are asking, will Tokyo recalibrate its strategic alignment with Washington, in the event of a return to a Trump-style ‘America First’ foreign policy?
Relations with China will be another key focus of international attention in the coming days. Kishida’s administration pursued a hardened stance towards Beijing. Japan’s 2022 National Security Strategy paper described China as the ‘greatest strategic challenge’. Of late, however, voices calling for a more nuanced approach that balances security concerns with economic engagement with China can be heard in Japan. In view of Beijing’s economic importance for Tokyo, the new prime minister may try to rejig this delicate balance, notwithstanding the territorial disputes and regional security issues.
Japan’s role in ASEAN and its commitment to the FOIP will be closely watched
Another regional flashpoint is the situation on the Korean Peninsula. North Korea aligning more closely with Russia and China presents a new security challenge. Japan’s territorial dispute with Russia over the Kuril Islands remains unresolved. Complicating efforts to improve bilateral relations with Russia is Japan’s open support for Ukraine. The new Japanese leader’s stance on these issues will be closely watched by policy-makers in the major world capitals.
Similarly, Japan’s role in ASEAN and its commitment to the FOIP will also be closely watched. Japan has been an important player in regional infrastructure development and economic partnerships, directly competing with China’s Belt and Road Initiative. The continuity of these efforts, including projects like the Northeast India-Bay of Bengal Industrial Value Chain corridor, will depend on the priorities of the new leadership.
However, regardless of who is at the helm in Tokyo, Japan’s partnership with India will remain largely unaffected. The India-Japan 2+2 ministerial meeting on August 20 in Delhi took place on a positive note.
A joint statement issued after the‘2+2’ talks, involving the foreign and defence ministers of the two countries in New Delhi, said that the 2008 declaration on security cooperation would be updated. The declaration is expected to be signed when Indian Prime Minister Narendra Modi visits Japan, sometime around the year-end.
Japanese Foreign Minister Yoko Kamikawa and Defence Minister Minoru Kihara met with their Indian counterparts Subrahmanyam Jaishankar and Rajnath Singh in the two governments’ third ‘2+2’ talks since their launch in November 2019.
The ministers also agreed to enhance their commitment to the Quad, a group of four major Indo-Pacific democracies that also includes the US and Australia, formed with the purpose of countering China’s growing clout in the region. They also decided to keep holding drills with other Quad members and the defiance forces of the two nations.
While India and Japan’s maritime security cooperation is stronger than before, the ministers ‘concurred on accelerating future cooperation in defiance equipment and technology’, the statement added. Tokyo is gradually revising its policies in this regard. Some examples include the 2023 and 2024 revisions to the Three Principles on Transfer of Defence Equipment and Technology and the Implementation Guidelines, the recent release of the Japanese Defence Ministry’s Basic Policy on AI, and the establishment of a DARPA-style research institute that will create novel technologies.
Japan’s Acquisition, Technology and Logistics Agency (ATLA) and its Indian counterpart, the Defence Research and Development Organisation (DRDO), are working to arrive at an agreement to conduct joint research in the area of unmanned ground vehicles (UGVs) and robotics. In addition, Japan’s NEC is likely to supply Unicorn communication antennas, similar to those installed on a new Japanese Maritime Self-Defence Force destroyer, to the India Navy.
On the larger plank, however, leaders of world democracies are worried about the fast-paced political developments in Tokyo. Will the next prime minister, Japan’s 101st, be able to provide a stable government and a continuum to the policies of his or her predecessor? Or will Japan see another political merry-go-round with frequent change of leadership that was a hallmark of the pre-Abe days?
Yvonne Gill is a freelance journalist based in London