{"id":355689,"date":"2026-02-09T15:31:32","date_gmt":"2026-02-09T10:01:32","guid":{"rendered":"https:\/\/forumias.com\/blog\/?p=355689"},"modified":"2026-02-09T15:31:32","modified_gmt":"2026-02-09T10:01:32","slug":"india-malaysia-relations-significance-and-challenges-explained-pointwise","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/india-malaysia-relations-significance-and-challenges-explained-pointwise\/","title":{"rendered":"India-Malaysia Relations- Significance and Challenges- Explained Pointwise"},"content":{"rendered":"

Recently, PM Modi visited Malaysia as a part of India-Malaysia Bilateral Summit where leaders deepened their Comprehensive Strategic Partnership<\/strong> across economic, strategic and people-to-people fronts. It was noted during the visit that India and Malaysia have close similarities<\/span> as both are ‘multicultural<\/span>, multi-ethnic<\/span> and multi-religious countries<\/span>‘. 11 key agreements were signed during the visit, providing impetus for the deepening of India-Malaysia relations.<\/p>\n

However, there are also serious challenges between India and Malaysia. In this article, we will look at the history of India-Malaysia Relations, significance of the relations and the way forward.
\n\"India-Malaysia<\/p>\n\n\n\n
Key Takeaways from the recent India-Malaysia Bilateral Summit:<\/strong><\/p>\n
    \n
  1. Semiconductor Cooperation:<\/strong>\u00a0Enhancing collaboration in semiconductor research, manufacturing, testing and global supply chain integration.<\/li>\n
  2. Disaster Management Cooperation:<\/strong>\u00a0Joint efforts in disaster preparedness, training and exchange of best practices.<\/li>\n
  3. Anti-Corruption Cooperation:<\/strong>\u00a0Framework for cooperation on transparency and anti-corruption measures.<\/li>\n
  4. Local Currency Settlement:<\/span><\/b><\/strong> Both nations reaffirmed their commitment to settle trade in <\/span>Indian Rupee (INR)<\/span><\/b> and <\/span>Malaysian Ringgit (MYR).<\/span><\/b><\/strong><\/li>\n
  5. UPI-PayNet Linkage: <\/strong>India and Malaysia have agreed to work on connecting India\u2019s Unified Payments Interface<\/span> (UPI) with Malaysia\u2019s PayNet<\/span> for digital transactions<\/span>.<\/li>\n
  6. Intelligence Sharing:<\/b> New agreements were signed between the National Security Councils of both countries to enhance intelligence sharing and maritime security in the Indo-Pacific.\u00a0<\/span><\/li>\n
  7. Terrorism:\u00a0<\/strong>The leaders of the both the countries unequivocally & strongly condemned terrorism in all its forms & manifestations, including cross-border terrorism. They called for zero-tolerance of terrorism & for concerted international efforts to combat terrorism in a comprehensive & sustained manner. They also recognised the linkages between terrorism & transnational organised crime.<\/li>\n
  8. Social Security Agreement:<\/span><\/b> A new pact between India\u2019s ESIC and Malaysia\u2019s PERKESO ensures better social security protections for Indian workers in Malaysia.<\/span><\/li>\n
  9. Thiruvalluvar Scholarships:<\/span><\/b> To deepen cultural ties, new scholarships were announced for Malaysian students to study in India, emphasizing shared Tamil heritage.\u00a0<\/span><\/li>\n
  10. AITIGA Review:<\/b> Both sides agreed to fast-track the review of the <\/span>ASEAN-India Trade in Goods Agreement<\/span><\/b> to address India’s trade deficit and improve market access.<\/span><\/li>\n
  11. UNSC & BRICS:<\/b> Malaysia explicitly reaffirmed its support for India\u2019s <\/span>permanent membership in a reformed UN Security Council<\/span>.<\/span> In return, India welcomed Malaysia\u2019s aspirations to join <\/span>BRICS<\/span>, with India serving as the 2026 BRICS Chair.\u00a0<\/span><\/li>\n<\/ol>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n\n\n\n\n
    Table of Content<\/td>\n<\/tr>\n
    What is the History of India-Malaysia Relations?<\/a>
    \n    What are the areas of cooperation between India and Malaysia?<\/a>
    \n    What is the significance of India-Malaysia Relations?\u00a0<\/a>
    \n    What are the Challenges in India-Malaysia Relations?<\/a>
    \n    What Should be the Way Forward?<\/a><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

    <\/a>What is the History of India-Malaysia Relations?<\/strong><\/span><\/span><\/h2>\n

    Historical Ties:<\/strong><\/p>\n

      \n
    1. Establishment of Relations:<\/strong>\u00a0The historical ties between India and Malaysia trace back over a millennium. The relation was significantly influenced by the Chola Empire<\/span> (9th-13th centuries). The Cholas established extensive maritime trade routes<\/span> that connected South India with the Malay Peninsula. It fostered close cultural and economic exchanges.<\/li>\n
    2. Rule over the Malaysian Territory:<\/strong>\u00a0Under the reign of emperors like Rajaraja Chola I and Rajendra Chola I, the Cholas established control over parts of Southeast Asia, including present-day Malaysia.<\/li>\n<\/ol>\n

      Post Independence Ties:
      \n<\/strong>India and Malaysia share close cooperation since the independence of both nations. The major phases of relations are mentioned below:<\/p>\n\n\n\n\n\n
      Establishment of Relations<\/strong><\/td>\nIndia established diplomatic relations with the Federation of Malaya<\/span> (predecessor state of Malaysia) in 1957<\/span>.<\/td>\n<\/tr>\n
      Phase of Strong Relations<\/strong><\/td>\nIndia-Malaysia enjoyed a strong relationship in the 1960s<\/span> as a result of the personal friendship between Prime Ministers Nehru<\/span> and Tunku Abdul Rahman Putra<\/span>. India and Malaysia have developed close political, economic and socio-cultural relations.<\/td>\n<\/tr>\n
      Strategic Partnership<\/strong><\/td>\nIndia-Malaysia relations were elevated to Enhanced Strategic Partnership<\/span> during the visit of PM Narendra Modi in 2015.
      \nThe Enhanced Strategic Partnership<\/span>\u00a0was upgraded to a Comprehensive Strategic Partnership during the visit of Malaysian PM Anwar Ibrahim in 2024<\/span><\/span>.<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

      <\/a>What are the areas of cooperation between India and Malaysia?<\/strong><\/span><\/span><\/h2>\n
        \n
      1. Geopolitical Cooperation: <\/strong>India and Malaysia are members of key global forums like the Commonwealth of Nations<\/span>, NAM<\/span>, G-15<\/span>, and G-77<\/span>. This forms a strong foundation for close geo-political mutual cooperation. Further, India and Malaysia closely cooperate through ASEAN plus<\/span> and East Asia Summits<\/span>.<\/li>\n
      2. Geo-strategic Cooperation:<\/strong>\n
          \n
        1. India and Malaysia have steadily expanded their defence ties since signing a defence cooperation memorandum in 1993<\/span>.<\/li>\n
        2. India and Malaysia engage in regular defence cooperation meetings, and joint military exercises. For ex-<\/strong> Exercise Harimau Shakti (Military), Exercise Samudra Lakshmana (Navy), and Exercise<\/span>\u00a0Udara Shakti (Air Force).\u00a0<\/span><\/li>\n<\/ol>\n<\/li>\n
        3. Geo-economic Cooperation:<\/strong>\n
            \n
          1. Bilateral trade between India and Malaysia has reached a record high of ~USD 19 billion<\/span>. Malaysia is among India’s 10 largest trading partners. India is among the top partners for Malaysia<\/strong> too.<\/li>\n
          2. As per official figures (DPIIT), Malaysia ranks as the 26th largest investor in India<\/span> with FDI inflow of US$1.16 billion during the period April 2000 to September 2022.<\/li>\n
          3. India is a significant investor in Malaysia<\/span>, particularly in sectors like technology, manufacturing, and services. More than 150 Indian companies, including 61 Indian joint ventures and 3 Indian Public Sector Undertakings, operate in Malaysia.<\/li>\n
          4. Exports from India:<\/span> It Includes mineral fuels, aluminum, meat, iron and steel, copper, organic chemicals, and machinery.<\/li>\n
          5. Imports to India:<\/span> It Includes palm oil, mineral fuels, electrical machinery, animal or vegetable fats, and wood.<\/li>\n
          6. ASEAN-India Business Summit 2023<\/span> celebrated 30 years of ASEAN-India Engagement, with significant participation from Indian and Malaysian stakeholders.<\/li>\n<\/ol>\n<\/li>\n
          7. Diaspora Cooperation:<\/strong>\u00a0Malaysia is home to over 2.95 million large Indian diaspora<\/span> and the second-largest Persons of Indian Origin<\/span> (PIO) community in the world after the US.<\/li>\n
          8. Cultural Cooperation:<\/strong> India and Malaysia share close cultural Cooperation, which are explained below:\n
              \n
            1. Institutional Cooperation:<\/strong> The Indian Cultural Centre Kuala Lumpur<\/span>, established in 2010<\/span> and Netaji Subhash Chandra Bose Indian Cultural Center<\/span> (NSCBICC) offers classes in Carnatic vocal music, Kathak dance, Yoga, and Hindi, with teachers from both India and Malaysia.<\/li>\n
            2. Literary Cooperation:<\/strong>\u00a0Hikayat Seri Rama<\/span> (Malay literary adaptation of the Hindu Ramayana epic) reflects local adaptations, and close literary cooperation. Ramayana’s themes are reflected in local stories, arts, and performances of Malaysia.<\/li>\n
            3. Shared Cultural Architecture & Craft:<\/strong>\u00a0The Sri Veera Hanuman Temple in Malaysia<\/span> shows the shared cultural heritage, with its architecture and tales deeply rooted in Indian traditions.<\/li>\n<\/ol>\n<\/li>\n<\/ol>\n

              <\/a>What is the significance of India-Malaysia Relations?\u00a0<\/strong><\/span><\/span><\/h2>\n
                \n
              1. Geopolitical Significance:<\/strong>\u00a0Close India-Malaysia relations aligns with India’s Act East Policy<\/span>. Close cooperation with Malaysia, provides India the strategic pivot towards the ASEAN region<\/span>, and enhance its influence and connectivity in South East Asia. Deepened India-Malaysia relations also forms an important pillar of India’s effort of outreach to countries of the Global South.<\/li>\n
              2. Geostrategic Significance:<\/strong>\n
                  \n
                1. Close cooperative mechanism between India and Malaysia on the Straits of Malacca and Singapore<\/span> (SOMS), is key for the establishment of rule based order in Indo-Pacific<\/span>.<\/li>\n
                2. Close India-Malaysia relations will enhance interoperability<\/span> and address regional security challenges<\/span> like counter-terrorism and extremism in South East Asia.<\/li>\n<\/ol>\n<\/li>\n
                3. Geo-economic Significance:<\/strong>\n
                    \n
                  1. Comprehensive Economic Cooperation Agreement<\/span><\/strong> (CECA) between India and Malaysia will provide a boost to India’s effort for achievement of its foreign trade target of $2 trillion in merchandise exports by 2030.<\/li>\n
                  2. The exploration of option of Local Currency Trade<\/strong> between the Indian Rupee (INR) and Malaysian Ringgit (MYR), will help in reducing reliance on the US dollar and enhancing economic resilience.<\/li>\n<\/ol>\n<\/li>\n
                  3. Cultural Significance:<\/strong>\u00a0The close people to people connect and the presence of large Indian diaspora in Malaysia can be leveraged for increasing the cross-border investment and trade<\/span>.<\/li>\n<\/ol>\n

                    <\/a>What are the Challenges in India-Malaysia Relations?<\/strong><\/span><\/span><\/h2>\n
                      \n
                    1. Extradition of Zakir Naik:<\/strong>\u00a0Malaysia’s rejection of repeated India\u2019s request for extradition of Zakir Naik<\/span>, who is wanted in India on hate-speech and money laundering charges, is one of the prominent challenges in India-Malaysia relations.<\/li>\n
                    2. Malaysia’s criticism of India’s internal Policies:<\/strong>\u00a0Malaysia\u2019s strong criticism of Indian Government’s Policies like the Citizenship Amendment Act<\/span>, and the re-organisation of Jammu and Kashmir<\/span>, has created further wedge between India and Malaysia.<\/li>\n
                    3. Economic Challenges:<\/strong>\n