01/21/2015 04:39 EST | Updated 03/23/2015 05:59 EDT

Japan has limited options to resolve ISIS hostage crisis

The Japanese government has limited options after ISIS militants demanded $200 million US for the release of two of its nationals, foreign policy experts say. 

In a video released Tuesday, a black-clad figure wielding a knife gave Japan 72 hours to respond to the ransom demand. 

"It’s fairly straightforward," said Arne Kislenko, who teaches international relations at Toronto's Ryerson University. "They do one of two things: Either nothing at all or they pay the ransom and both have fairly substantial consequences."

Given the track record of Islamic State in Iraq and Syria, known as ISIS, which includes killing American hostages James Foley and Steven Sotloff, it is predictable what will happen to the two men being held if nothing is done, he said. 

"They are bound to execute them."

However, paying the ransom — even a smaller amount below the unusually high $200 million — would damage Japan's reputation with its close ally the U.S. and European countries, as well as encouraging further abductions in the future, said Sheila A. Smith, senior fellow for Japan studies at the Council on Foreign Relations.

"I think it would be very hard for Japan, given its position on terrorism, which is very strong, to reward ISIS," she said. 

Paying ransom is controversial

Tuesday's video marks the first time an ISIS message has specifically demanded cash. The extremists requested $132.5 million from Foley's parents and political concessions from Washington, though neither were granted during the months of negotiations before his killing, U.S. authorities said.

According to figures released by the U.S. Justice Department in October, ISIS militants earned $20 million from ransoms last year. 

A government paying a ransom to extremists is a controversial issue, Kislenko said, because a number have been reported to have secretly paid for the release of its citizens while also maintaining that they do not negotiate. 

The G8, which includes Japan, issued a communique in 2013 saying, "We unequivocally reject the payment of ransoms to terrorists."

"So there is a huge hypocrisy here," Kislenko said. "You know, if Japan pays and we all chastise them for it."

'Never give in to terrorism'

Japan's Prime Minister Shinzo Abe and other officials have declined to discuss whether Japan will pay the ransom for the captives – freelance journalist Kenji Goto,47, and Haruna Yukawa, 42, the founder of a private security company.

Tuesday's demand followed a commitment by Abe to provide $200 million in non-military aid to countries battling ISIS.

On Wednesday, Abe said Japan was doing everything it could to get the two hostages released, but also vowed that his country would "never give in to terrorism." He has emphasized the humanitarian nature of the $200 million and said the country's policies wouldn't change. 

Smith said it seems unlikely that Japan would be willing to pay the ransom, or rescind its commitment of aid.

"I think we can't rule out that that is an option being considered, but remember that Japan's entire post-war foreign policy is based on a strong humanitarian role," she said. 

Raid a high-risk venture

The option of a rescue in the form of a special operations raid is also probably not on the table, in part because the Japanese military operates almost exclusively in a self-defence capacity at home. 

Kislenko said asking an ally like the U.S. to launch an operation is challenging for Washington because it could create a backlash at home for putting American soldiers at risk for another country's citizens. 

A raid is also a risky undertaking, particularly given the 72-hour deadline, which limits the amount of time to gather information, he said. 

In December, an American photojournalist and a South African teacher were killed during a U.S.-led raid in Yemen that was ordered by President Barack Obama after information indicated there was "imminent danger" to the American hostage. 

"I don’t know that there is a tactical operative option at hand," Kislenko said.