Japanese Prime Minister Shinzo Abe’s election victory has ensured four more years in power for him and a longer run for “Abenomics”, the economic policy put in place by Abe’s coalition to revive the troubled Japanese economy. Although detractors had questioned the need for Sunday’s snap polls that saw a very low turnout, the two-thirds majority is expected to help Abe crush, not just contain, intra-party resistance to his economic policies. As Japan’s most powerful PM in many years, Abe is likely to push ahead with more difficult economic reform. His government may also more easily navigate through the potentially heated debate next year on reforming Japan’s constitutional pacifism to expand Tokyo’s military role — which will have consequences for Japan’s maritime disputes with China.
Abe, however, may have a tough job on the economic front. Despite a growth spurt, Japan slipped back into recession in the second half of 2014, blamed largely on a sales tax increase, which seemed to negate Abenomics’ hopes pinned on consumption. Abe claims the new mandate will help him delay a second increase. But of Abenomics’ “three arrows” – printing more money, increasing government spending and reforming key sectors — it is deep structural reform that Japan needs most and finds most difficult, given its demographic challenge as a shrinking nation and its opposition to large-scale immigration to expand the labour force.
For India, Abe’s win is good news. Prime Minister Narendra Modi and Abe have shown a special warmth to each other and have recast the bilateral relationship as critical to making this an Asian century. Delhi and Tokyo need each other to optimise their bilateral synergies and thereby enhance their influence on a changing world stage that is rapidly making room for a rising China.