Japanese Prime Minister Shinzo Abe has given utmost priority to sign a peace treaty with Russia as well as gaining back the control of the Northern Islands (known as Kuril in Russia). There have been 23 rounds of summit level interactions between Prime Minister Shinzo Abe and Russian President Vladimir Putin, and the most recent was held on the sidelines of the G-20 Summit in Buenos Aires. During Abe-Putin meetings, signing a peace treaty and resolution of territorial dispute, an issue lingering between the two countries ever since the end of the World War II, has been on the agenda. Following their talks, Japan and Russia set up a high-level consultative framework, termed as a “new framework” which is expected to speed up talks to resolve the issue as also consolidate bilateral ties.

The Japanese media reports suggest that Abe may settle for two islands instead of seeking return of all four. If that be so, it could be interpreted as a departure for Japan’s long held stance that it will “conclude a peace treaty” with Russia “contingent on the resolution of the Northern Territories issues.” But it is in conformity with Putin’s formula of a hikiwake (a term used for a draw in judo) with Japan which was mooted after Putin assumed Russian Presidency. It may be noted that in the 1956 joint declaration, Russia (then USSR) agreed to transfer to Japan the Habomai Islands and the island of Shikotan, the two smaller islands after the conclusion of a Peace Treaty between the two neighbours. But due to strong domestic opinion which was against any kind of deal with Russia, Japan did not implement the declaration; subsequently the four islands remain under Russia’s ‘illegal occupation’. The Cold War politics also acted as a stumbling block and the issue was rarely discussed.

After the end of Cold War, Japan and Russia renewed interest to resolve territorial disputes, and the 1956 joint declaration emerged as a reference point for bilateral talks. Both are keen to develop the Far East region including the contested territories through foreign investment. Japanese investors have launched few ‘joint projects’” in the Far East region, but Tokyo is averse to foreign investment on the contested territories especially on Russian bids which will undermine its sovereignty claim over the territory. A mutually agreed settlement will ease Russian efforts to develop infrastructure on the territories.

From the Japanese perspective, there is a human angle too; nearly 17,000 inhabitants, who were expelled in 1949 by the Stalin regime, live in Hokkaido. They have not left hope to go back to the ‘homeland’ and continue to demand that governments pave way for their return. Significantly, they have been observing Northern Territory Day each year on February 7. Most of them are in their 80s and want to fulfill their dream to resettle on the Northern Island during their life time.

There is also the issue of fishing rights. The area closer to Hokkaido is rich in fisheries but the boundaries and the Exclusive Economic Zone are not demarcated. In the interim, Japan and Russia have fixed fishing quotas for each other’s fishermen. However, Japan found that its fishermen have been bribing the Russian border guards who board Japanese fishing trawlers to inspect if the quotas agreed by both the authorities have been adhered to. Tokyo believes that it undermines its sovereignty over the territory and has penalized some of its fishing companies in 2010. If Japan and Russia resolve the sovereignty issue under the 1982 UNCLOS, Japanese fishermen will get access to vast fishing area.

Public perception at home is also critical for both the leaders. During his last term in office, Abe maintained good public approval rating which is an important factor for the survivability of a Japanese Prime Minister in office; resolution of the dispute will help boost his popularity within Japan and prevent any internal demand for change of guard within the party. Putin on the other hand, wants to shed his expansionist image post-Crimean annexation; if he concedes some of the islands to Japan, it will be an image makeover.

However, both Abe and Putin face two hurdles; first managing the public opinion in their domestic constituencies. While in Japan public opinion is shifting largely in favour of resolution of the territorial dispute, the media in its editorial has been questioning Abe for not revealing to the public the contents of the prospective deal. They are also wary of Putin’s recent remarks in which he asked Japan to sign a peace treaty without putting any conditions. On the other hand, Russian people are largely opposed to handing over the islands to Japan. An opinion poll has revealed that nearly 76 per cent of the Russian respondents are opposed to transfer of sovereignty of even smaller islands to Japan.

The second issue is Russia’s demand that Japan not station US troops on the transferred islands. US-Japan Security treaty applies to the entire area under Japanese sovereignty and administration. Japanese media has reported that Japan has in principle agreed to this demand. The security experts and media have expressed opposition and demanded more clarity, and the Japanese Foreign Minister Taro Kono, however, has declined to comment on such an assurance from the Japanese side.

What would be the contour of an agreement between Japan and Russia to resolve their dispute is still unclear and clarity can be expected after Taro Kono and Sergei Lavrov meet before the next Abe-Putin summit in early January 2019 in Russia. There are high expectations that these back to back meetings would be helpful in resolving the disputes. If this is put into fruition, it can potentially impact on regional peace and security. Besides it can also be an example for many neighbours around the world.

Dr Shamshad A. Khan is Visiting Associate Fellow at the Institute of Chinese Studies, New Delhi.