Sunday 31 January 2016

A friend of India wins in Taiwan (Sunday Guardian)

By M.D. Nalapat | 30 January, 2016
Ever since Prime Minister Narendra Modi took office in 2014, the image of India in East Asia has risen to the status of a Great Power.
TAIPEI: Unlike Sirimavo Bandaranaike, Indira Gandhi, Benazir Bhutto or Sheikh Hasina, the victorious candidate in the 2016 Presidential elections in Taiwan was not born into a political family. Tsai Ing-wen is, therefore, going to be the first non-dynast lady President (or Prime Minister) in Asia, if Tansu Çiller is excluded on the grounds that EU prejudices against the Muslim-majority country notwithstanding, Turkey is European. She is also the first female Head of State (and government) in any Sinic country. Some within the Democratic Progressive Party (DPP) may bridle at this, but the reality is that Taiwan is very much a part of the Sinic world. Indeed, a case could be made that the island is even more “Chinese” in its culture than the nearby Peoples Republic of China, ever since the Cultural Revolution and other vicissitudes caused by Mao Zedong demolished much of existing traditions within the country. In Taiwan, there is a four-month hiatus between the election and the takeover of power by a new government, a length of time unusual in its length, so DPP Chairperson Tsai will take over as President Tsai only on 20 May. The four-year term is unlikely to be anything other than a choppy ride.
Economic growth has been flagging, causing a constriction of salaries and a lack of adequately paying jobs, especially for the young. There are predictions that President Xi Jinping will respond to the Taiwanese people’s turfing out of Beijing’s favourite, the KMT, in favour of its bête noire, the DPP, not simply in the Presidential polls but in the country’s legislature as well. However, such a churlish reaction is unlikely. Xi will remember the hostile reception Beijing gave to the DPP’s first Head of State, Chen Sui-bian, when he tried, hesitantly, to extend an olive sprig to the Chinese leadership, only to be rebuffed. The experience ensured that Chen reversed his fledgling efforts at conciliation throughout the rest of his term, goading China whenever and wherever he could in a manner reciprocated with compound interest by the other side.
In a move which must have delighted the Chinese Communist Party, incoming President Ma Ying-jeou of the KMT put ex-President Chen in jail on corruption charges soon after taking office, and there the former President remained till recently, when he was released into house arrest on grounds of ill-health. Radicals within the DPP are looking forward to repaying the compliment in the case of President Ma, by bringing up issues relating to his term in office as Mayor of Taipei, as well as a case involving the interception of telephone conversations of members of the legislature, although hopefully such a precedent — of putting a former Head of State belonging to a different party in jail once his or her successor takes over — will not be followed by incoming President Tsai. Certainly there are those in the KMT, and quite possibly some in President Ma’s entourage as well, who merit prosecution and punishment, but it is doubtful that the current President of Taiwan is among them, vindictive though the jailing of his predecessor was.
More than domestic politics, what will worry incoming President Tsai will be the state of play between Taipei and Beijing. The new Head of State is very different from her DPP predecessor Chen Shui-bian, and in particular has way more experience in dealing with issues relating to China. On the other side of the Taiwan straits, President Xi Jinping is unlikely to adopt the tough approach of Jiang Zemin, who openly threatened Taipei with a show of military firepower. That ensured the defeat of the pro-China KMT in the subsequent elections.
Like others across the globe, the Taiwanese do not like being bullied, and should China react to the Tsai victory by seeking to cut back on economic and other links (for example, by forcing down the number of tourists visiting the island), it would hurt both economies as well as erode the goodwill in Taiwan for China, the country from where the overwhelming majority of the people of Taiwan migrated from, over the past two centuries. However, Xi is facing a challenge in his efforts to downsize the immense power of the “princeling” class over state enterprises, and is aware that Taiwanese businesses are core to the prosperity of the PRC, hence it is unlikely that Xi and Tsai will have the same tension-filled relationship as did Jiang and Chen.
During the eight years that Ma Ying-jeou has been at the helm in Taipei, the relationship between Taiwan and China has reached a level unprecedented in recent history. The odds for stability are therefore higher than for tensions to boil over. And importantly for India, this is a country that Tsai Ing-wen has often referred to, and which she admires as the world’s most populous democracy. Come 20 May, it is a certainty that linkages between India and Taiwan will grow at an accelerated pace. Since Prime Minister Narendra Modi took office in 2014, the image of India in East Asia has risen to the status of a Great Power, and Delhi is now firmly in the radar of all the capitals in the region.

Saturday 30 January 2016

Mistura only hope for Turkey vs Russia (Pakistan Observer)

President Vladimir Putin of the Russian Federation needed a showcase for the advanced weaponry produced within his country, and secured that in Syria. Precision strikes by his air force and effective use of Russia-built ordnance by the Syrian military have ensured that the militarised anti-Assad forces are in retreat, such that within the year, three-fourth of Syria is likely to return in the control of the government led by Bashar Al-Assad. UN “Peace Envoy” Stefan de Mistura is ceaselessly trying to ensure that Damascus and Moscow lose at the negotiating table what they have gained on the battlefield, seeking to put in place a “transitional government” in Damascus that would soon do to Assad what US-backed Afghan fighters did to President Najibullah just over two decades ago. Since the 1990s, the UN system has become an extension of the NATO alliance, with the EU monopolising “peacekeeping” slots so that interests of the world’s most well endowed military alliance be promoted under the cloak of the UN.

That organisation now functions in such a way that the General Assembly has become a cipher, and control over operations has devolved to the Security Council (UNSC), where NATO has a majority within the Permanent Five. These - the US, UK, France, China and Russia – are the only countries which count in the New York headquarters of what was intended by idealists to be a World Government. Even India, which has a billion-plus population and an economy, which in Purchasing Power Parity terms is third largest in the world, has the same status within the United Nations Organisation as Lesotho or Fiji. Unless the US brings to the table the candidature of India (together with Brazil, Japan, Germany and South Africa) as a Permanent Member of the UN Security Council and forces a vote on each country, the chances of UN reform appear slight. Four of these five are likely to pass the test, with only Japan likely to fail due to a veto from Beijing, which is presumably why Washington is reluctant to bring the issue of UNSC expansion to a vote in the General Assembly as well as the UNSC. It suits each of the five permanent members of the UNSC to postpone the issue of UN reform and continue jointly exercising full control over UN operations, of course with major share of decisions going in favour of the NATO majority on the council. 

Each of the five is a nuclear weapons state, with Russia and the US being far ahead of the other three, although China is catching up in both numbers as well as in sophistication of technology. Policymakers across both sides of the Atlantic still behave, as though this is the 19th century, and hence go beyond prudent levels in their geopolitical challenges to rivals. An example is the way NATO has provoked Russia, buy first seeking to gobble up its periphery and convert them into bases against Moscow, and then imposing economic sanctions on Russia when that country retaliates against such a policy of containment. The US and the EU have made an error in persisting with sanctions on Russia, and not merely because the perilous state of the global economy makes such moves even more self-defeating than usual. These sanctions have resulted in a steady increase in the linkage between Beijing and Moscow, just as the isolation of Iran and Myanmar led to both coming close to China, a country too big to sanction, now that its economy is nearing the size of that of the US. Historically, relations between Turkey and Russia were adversarial during the period of Ottoman rule in the former and Tsarist control in the latter. Today, President Erdogan is visibly seeking to bring back lost glory of the Ottoman period, making moves designed to carve out an Ankara-controlled sphere of influence well beyond present borders of his state, while President Putin is as powerful in Russia as most Tsars were.

However, the present tension between Moscow and Ankara are because of Turkey, who is eager to establish control over Syria and recognises Russia as the primary obstacle to success in this endeavour. Shooting down a Russian air force jet that overflew Turkish airspace for only a few seconds was made possible because of the umbrella provided by NATO, which stands by Erdogan despite his policy of arming and facilitating elements that are indistinguishable from Daesh. However, should Russia retaliate to a fresh Turkish move by shooting down an aircraft of that country, it is very unlikely that anything other than strong language will come out of Brussels. Europe would be thrown into chaos, if there is armed conflict between NATO and Russia, given the fact that the armies of the alliance have proved themselves to be incompetent in the field of battle, being defeated even by such a raggedy bunch as the Taliban. 

The Afghan and Iraqi armies - which have deliberately been kept under-equipped by NATO - are showing themselves much more proficient in battle than the soldiers in NATO armies, whose sole purpose seems to be to preserve their own lives, no matter what “collateral” damage get inflicted in the process. Against Russian troops, NATO conventional forces are likely to face a rout, while a nuclear exchange would lead to incalculable damage to both sides. President Erdogan clearly did not factor in such a reality when he embarked on a policy of seeking to humiliate Russia into withdrawing from Syria Vladimir Putin’s response was to hit back by bombarding those forces in Syria who report to their Turkish commanders and Saudi and Qatari funders. So effective had the counter-attack been that it is clear that those who believed that Russian military equipment was no longer equal or superior to that of the US were wrong. 

Looking at their respective performance in Syria, it is clear that the SU-35 is far superior to France’s Rafeal although for diplomatic reasons. Prime Minister Narendra Modi is believed to have cleared the purchase by the Indian Air Force of the latter. The consequences of Syria go far behind relations with Turkey, which is why it was adventurous of President R T Erdogan to challenge Vladimir Putin. That challenge is being replied to in battlefields of Syria, and it is not to Turkey’s advantage. Ankara’s only hope is that Stefan de Mistura in his UN camouflage persuades Moscow to surrender its gains at conference table and agree to extremists entering the government in Damascus as Trojan horses.

—The writer is Vice-Chair, Manipal Advanced Research Group, UNESCO Peace Chair & Professor of Geopolitics, Manipal University, Haryana State, India. 

Monday 25 January 2016

BJP’s forgotten truth: Perception trumps reality (Sunday Guardian)

It is a wonder that Bollywood has yet to wake up to the star in its midst. The Hyderabad University ABVP student, who initiated a series of complaints which finally claimed the life of Rohith Vemula spoke about a gang of thirty students from a rival student body “assaulting” him. Only in the movies can an individual escape with so little visible damage from an attack by such a number. He further claims that the five students whom an obliging Vice-Chancellor expelled from the university also “attacked” him mercilessly. Looking at this physically unimpressive but apparent superman in our midst, it is a bit difficult to believe that both attacks — assuming they took place — were anything other than verbal. In common with other parts of India, Hyderabad too has bigots who look with unease at the way in which Dalit students have broken through scholarly and occupational barriers, and it is a fact that several from the “backward” communities resent having to compete in the job market with highly trained Dalits. Hence, to lump (economically prosperous and politically powerful) Kammas and Kapus with still disadvantaged Dalits, as apologists for the Vice-Chancellor have repeatedly done on national television, is to be frugal with the facts. It is hard to accept that the intervention of a Union Minister or repeated missives from the HRD Ministry to the university constitute anything other than an unusual interest in the campus politics of an institution autonomous only in name. Those who believe that universities in India are “independent” are ignorant of the reality of the control exercised by the MHRD and bodies such as the UGC on universities in India, a primary reason why they fare so poorly in international rankings.

To quote an example, a university in the South two years ago entered into routine MoUs with four universities in China, each of which incidentally has already more than one partner universities from India. However, in the case of this university, the MHRD — then under the control of globalised liberals such as Shashi Tharoor — ordered through its agencies that the MoUs be scrapped. Soon afterwards, the same authorities who have made it their business to stifle the autonomy of centres of higher education in India, declined to give permission to the same university (which is among the best in Asia in global rankings) to act as the mentor university of the proposed University of Afghanistan. Surely, having an Indian rather than a US or Pakistani university as mentor would significantly boost ties between Afghanistan and India, something which apparently escaped the minds of those in government who killed this proposal through refusal to give permission. Incidentally, in most other democracies, universities have genuine autonomy, and do not need such nods from government in their routine work. Since the Narendra Modi government took charge on 26 May 2014, educational institutions across the country have been waiting for a departure from Kapil Sibal’s chokehold over universities by the MHRD and its affiliates. Twenty months after the swearing in of the new government, they are still waiting for such a change. The same Stalinist attitudes prevail, as do the same bureaucrats who were in control of the levers of decision-making then and now. Prime Minister Modi is nearing the close of his second year of governance, and this columnist still believes that before the close of this period, he will liberate his government from the Nehruvian coils of a 19th century colonial system of rules and procedures designed to kill initiative and convert citizens into chattels of the state.

If Prime Minister Modi is facing headwinds in his efforts at crafting a 21st-century system to replace the British-Mughal era construct that has kept India in a state of poverty when other Asian powers have made rapid progress, much of the reason vests within his own party, which has been in a tearing hurry to ensure Modi does not get a second term. Had the Land Bill and the GST Bill got passed, especially in the first or second parliamentary session after the Modi sweep of the Lok Sabha polls, across the world confidence in the capacity of the NDA government to effect reforms would have shot up. Even in the case of the Land Bill, it was surely not impossible to reach out to opposition parties and get a modified version passed, while the Congress Party has several times assured the public that it would help pass the GST Bill if the three conditions set by it were accepted. For a starving man, half a loaf is better than nothing and ours is an economy which has within itself hundreds of millions of the destitute. However, the BJP adopted a stance that closes the door to such accommodation, as in its view, “no bill is better than a flawed” bill, i.e. a bill that incorporates the opposition’s suggestions. This is a wrong approach.

Even if both bills got passed with modifications, that would nevertheless have given a signal of pragmatism to the rest of the globe, and encouraged investment into India. Waiting indefinitely for Rahul Gandhi to change his mind and accept the BJP version or holding back on vital bills till the NDA secured a majority in the Rajya Sabha means that key reforms will get rolled out too late — if at all — to have an effect on the 2019 Lok Sabha polls.

Along with choosing a more effective team in the next reshuffle, Prime Minister Modi needs to pay attention to perception, for this affects voter behaviour even more than reality, especially if the real benefits of policy have yet to reach a level which would make an impact on voters. Looking at their arguments, BJP spokespersons seem to believe that they are arguing in a courtroom before a judge. Unfortunately for their party, the chemistry of the public is a tad different from that of a trained jurist, and arguments which work with the latter may fall flat with the former. Whether it be over the Hyderabad incident or elsewhere, the BJP seems to be disconnected from the voter in the fashioning of explanations meant to blunt criticism of its moves. The loss of the “independent” vote explains the BJP’s serial defeats in the year just past.

Sunday 24 January 2016

Union budget crucial for Modi (Pakistan Observer)

Within a month, Finance Minister Arun Jaitley will present the 2015-16 Union Budget, his third since taking over the post on May 26,2014. The first two budgets have been widely seen as following the same track as its predecessors, and certainly did little to unleash the “animal spirits” of corporate India, which continues to hoard cash reserves rather than make fresh investments in the country. Prime Minister Narendra Modi made his name in politics due to the efficient way in which he ensured the development of the state. People from across the country saw for themselves the relative absence of corruption and a prompt delivery of government services. Electricity flowed 24/7 rather than in fits and starts as in neighbouring Maharashtra, a richer state in taxation terms thanks to Mumbai being within its boundaries .

Schemes were introduced to ensure that even the poor got access to private health facilities, while roads were well-maintained. Of course, the Information Technology industry did not flock to the state in the profusion with which it did Bangalore in Karnataka, to an extent because of Chief Minister Modi remaining true to Mahatma Mohandas Karamchand Gandhi’s doctrine of prohibition of liquor. Night clubs were absent. Those living in the state were expected to go to bed early and abstain from alchohol, while a vegetarian diet was de riguer in government offices, again in deference to the culinary tastes of the abstemious Mahatma, who though born in a business caste, had a visible disregard for personal wealth to the extent that it caused some discomfort to family members.

Mahatma Gandhi’s approach to his family was in contrast to that of his friend Motilal Nehru, who lavished resources and attention on his son Jawaharlal and constantly lobbied the Mahatma until the younger Nehru was imposed on the Congress Party as its chief despite Vallabhai Patel having much greater support among the cadre. In contrast, Mahatma Gandhi refused to accept money from friends so as to give a good education to his children. one of whom ended up on the streets of cities across northern India begging for alms, ignored by his father. 2016 is going to be a crucial year for Modi, for unless he revives the economy and ensures a flood of new jobs, the political fortunes of the BJP are likely to remain bleak.

The party was almost annihilated in the Delhi assembly elections and reduced to a rump in the Bihar assembly months later, despite strenous efforts being made to ensure that politicians from Bihar played an outsize role in the Union Cabinet and even in the central government. Again following the teachings of Mahatma Gandhi, for the first time since 1965,a conscious effort was made by the central government to downgrade the use of English in governance and replace it with Hindi, and to slow down the growth of English-language schools and colleges, the way Pakistan in the 1970s gave primacy to Urdu over English, which has ensured that the international link language is not spoken in the country in the manner in which it would have had it been encouraged. Pakistan followed the example of Sri Lanka, where in the 1950s,the use of English (and Tamil) was discouraged and Sinhala promoted. However, energetically favouring Hindi across the board does not seem to have helped the BJP in Bihar.

The central government has been gifted a cushion approaching $ 70 billion because of the crash of oil prices. Unlike in the US, where the price of oil at the pump is not even double that of a barrel of crude oil, in India the retail price for petrol is close to ten times the price of crude, almost all the increase being accounted for by taxation. Crude oil prices have crashed but petrol prices at the pump have been lowered only slightly, even though a much bigger reduction would have had an immediate effect on bringing down inflation. Because Reserve Bank of India Governor Raghuram Rajan is fixated on US textbooks, he regards high interest rates as being price deflators, when common sense would show that such a measure adds to costs and therefore to prices. 

Similarly, the Union Finance Ministry continually raises taxes in various forms, including a recent cess to “make India clean”, something that does not seem to be taking place at any great speed. Of course, it must be said that the ministry is refreshingly straighforward. In its “Mid-year Economic Analysis 2015-16”, it admits that there is “uncertainty” about the accuracy of GDP date, and that there are often “mixed signals” (page 6). On pages 6,7,8 and 9,the analysis goes into considerable detail about why it regards important measures of economic health to be flawed. It is hard to believe that any other country has a Finance Minister as brutally frank about its statistics and its conclusions as India, as most put a gloss over the truth rather than reveal it openly to investors across the world. 

For those of average intellect, such as this columnist, it is difficult to understand parts of the analysis. For example, on page 5 it speaks of “steady recovery” but in the very next page, admits that this economic year is “difficult to understand”. While the analysis claims that “gold imports have stabilised”, it neglects to mention that this took place because gold prices during that period were unusually volatile and that in recent weeks, gold imports have once again risen sharply. Hopefully,those who prepared the analysis with such honesty will ensure that India gets the low tax and gentle compliance regime needed to entice tens of millions into the direct tax net. 

The system of high rates of taxation (especially for those in the services sector, who are being taxed twice over, and who consequently have seen the sector slow down considerably) has not worked, and it was a disappointment to many that first two budgets of the Modi government were so similar to its predecessors. Across the country, taxpayers present and future are hoping that Prime Minister Modi will not outsource the crafting of the 2015-16 Union Budget to anybody else, but will take control of the process so that innovative measures and substantial relief for the middle class will be provided. Sensible economic policies take nearly three years to strongly reveal their benefits, so this budget is crucial for Prime Minister Modi, who needs to show strong growth in 2019 in order to win a second term of office. 

—The writer is Vice-Chair, Manipal Advanced Research Group, UNESCO Peace Chair & Professor of Geopolitics, Manipal University, Haryana State, India. 

Friday 22 January 2016

Will Tsai Ing-wen strengthen India-Taiwan relations? (Gateway House)

India has long sought China over Taiwan, so is it too late to rectify foreign policy? The recent election results in Taiwan have upset China as China fears it will lose control over Taiwan. Gateway House interviews noted China expert Professor Nalapat to get his take on Taiwan's new president-elect and what lies ahead for tenuous Sino-Indian-Taiwan relations.

Gateway House: The first female president-elect of Taiwan. How do you see this impacting its relations with China, which were coming back on track?
Madhav NalapatThe acceptance of Dr. Tsai Ing-wen by all groups of Taiwanese indicates Taiwan has become a highly evolved, liberal society.  As far as China is concerned, it is, of course, a complex situation.
A few months ago, we had the first-ever meeting between a Chinese president and Taiwanese president, and things looked rosy.
As the Kuomintang of China (KMT) were undefeated by the People’s Liberation Army, or Chinese Communist Party (CCP) in 1949, and merely retreated to Taiwan, the Taiwanese regard it equal in status to the CCP. The only workable solution, I believe, is “one nation” — one Chinese nation — “but two separate Chinese states”: the communist state headquartered in Beijing, and the democratic state in Taipei, and both, part of the great Chinese republic.
Is it that the youth of Taiwan want independent identity? There was the feeling that Taiwan did not want separate status as the government had been trying to better ties with China with all the economic and trade agreements it was signing, yet we saw this massive rally in 2014, supported by the youth of Taiwan against the trade pact, and now, one-and-a-half years later, we have the outcome of the recent elections…
Taiwanese are not really rejecting the fact they belong to China, but that Beijing tries to control them.  KMT went wrong in acting subordinate to communist China.
China Daily warns of China-Taiwan relations getting strained because of Tsai’s victory. So, the Chinese are not taking this well?
China Daily has been right on some things and wrong on many others, as in its assessment of Dr. Tsai: She is not going to make provocative moves towards the mainland like former Taiwan president Chen Shui-bian did, and it is a mistake for people in Beijing to regard her as a new version of him.  Unfortunately, CCP leaders had little contact with her, and the China Daily article you refer to is likewise ignorant.
Dr. Tsai would like to see Taiwan develop on its own track, but knows good relations with the mainland are vital for that, and I doubt she would do anything to destabilize (OR destabilize) those. It is not a track that is hostile to China.
Tell us about the time, in 2012, when you brought Dr. Tsai to Gateway House and India.
Well, Dr. Tsai is a liberal democrat who likes to be close to the people. So, we deliberately kept her visit low key in terms of pomp and luxury, letting her walk around Bombay, travel by train, stay in a four-star hotel… I think the people of Taiwan have chosen wisely, and chosen well, and I say this despite my regarding outgoing President Ma Ying-jeou a superb leader and good friend.
We have seen Prime Minister Narendra Modi’s foreign policy reset in the past twenty months to with countries not given due consideration in the past few years. Although India and Taiwan do not have a working relationship at the moment, will Dr. Tsai as president change that?
The potential for India-Taiwan cooperation is immense, but our bureaucracy has to give up its paralysing fear of China.  We should engage vigorously with the new government in Taiwan, on the same level as Southeast or East Asia does with Taiwan. Unfortunately, the Indian bureaucracy is not very courageous when it comes to taking the initiative.
I would like Dr. Tsai to visit India again. Her first visit to us was delayed for a long time as our bureaucracy was so terrified of China, they did not want her to come. Yet the Chinese are pragmatic and reasonable people; they may say something, but realise they have to cut some slack. India is too big to be ignored by any power, and we have a bilateral treaty.

As long as it does not go against the central interest of any power, we should act as we deem fit, in our best interest. There is a good strong score for really vigorous engagement with Taiwan, and I am really hopeful that, in the three-and-a-half years remaining of Prime Minister Modi’s full term, coupled with Dr. Tsai’s presidential four-year term, both of them will ensure a truly strong relationship between New Delhi and Taipei.

This transcript was especially abridged for Gateway House: Indian Council on Global Relations.

Professor Madhav Nalapat, holds a UNESCO Peace Chair and is a senior associate of the National Institute of Advanced Studies, India. He is also a board member of the India-China-America Institute, and an Associate of the United Services Institution of India.

Monday 18 January 2016

Chief Justice Thakur, protect freedom of speech (Sunday Guardian)

Supreme Court needs to assume the responsibility of ensuring that the people of India enjoy freedoms that are the birthright of those born in a democracy.

Chief Justice of the Supreme Court of India T.S. Thakur is known among his peers for his integrity and his determination to ensure justice. Both qualities will be needed if he is to ensure that the immense power of the institution he heads gets used to ensure that the freedoms given to the citizens of what is widely regarded to be a democracy cease to be rolled back or diluted. This is a context where an individual was thrown into prison simply for making a few joking references to a “baba” (otherwise known as an individual regarded as divine by himself and by his followers). Enraged at the slight on the presumably godly personage, a follower filed a complaint before the Haryana police demanding that the humorist be prosecuted. Some years ago, a handbag containing the manuscript of several poems and belonging to this columnist’s wife was stolen near an office block in Gurgaon. The thieves threw some currency notes near the car in which the handbag had been placed, thereby motivating the driver into opening the door and scrambling about on all fours in an effort to retrieve the Rs 10 notes strewn about. During that period, the thieves made off with the handbag. It was expected that the gentlemen who made off with it would be located, as they were regulars at the location and therefore apparently known to the occupants of a police vehicle parked a few feet from the vehicle from which the bag was stolen. However, the police were simply not interested in the matter.

Given such a record, it would have been expected that the boys in uniform would not have allowed a complaint about a joke to disturb their afternoon nap, but in an uncharacteristic display of efficiency, the Haryana police hauled in the offending jokester and brought him before a magistrate, who lost little time in depriving him of his liberty for a period of two weeks. Quite possibly, such dispatch on the part of the police was owing to the pull effect of the “divine” gifts of the baba in question. However, does a country where a harmless joke gets met with imprisonment merit being called a democracy? In India, the colonial system of laws and administration has resulted in a situation where it is as easy as in North Korea or Saudi Arabia to deprive an individual of his or her liberty, a fact once again exemplified by this arrest. The follower of the baba was “hurt” at the less than adulatory references to his hero, and sent the offender to jail. This columnist has been hurt by the ease with which the liberty of a citizen of India was taken away as a result of the complaint filed by this baba-follower. Now would the Haryana police arrest the complainant in the “case of the mocked baba” because of the hurt he has caused to all those who believe in freedom of speech and other democratic rights of the citizen?

In China as in Saudi Arabia, there are individuals above negative comment. Should a mocking cartoon get printed about President Xi Jinping or King Salman, those responsible are unlikely to have an untroubled existence for a considerable period of time thereafter. However, unlike India, neither country advertises itself as a democracy. From the banning of a book (Rama Retold) by satirist Aubrey Menen in the 1950s to this country being the first to ban Salman Rushdie’s Satanic Verses in the 1980s, a regressive and corruption-fuelling colonial system has repeatedly been used to emasculate freedom of speech to a level far below that found in other major democracies.

In such a situation, the Supreme Court of India needs to assume the responsibility of ensuring that the people of India enjoy freedoms that are the birthright of those born in a democracy. Of course, there have been periods in the past when even life was not regarded as a “fundamental” right. Recently, when a High Court verdict boldly underlined the regressive nature of Section 377, and in effect deemed it illegal, the Supreme Court gladdened admirers of Victorian moral codes by striking down the HC verdict. A bit earlier, in 2011, the court affirmed that Rs 100 crore was fair recompense to be paid to a former judge, because a news channel had for a few seconds shown his countenance rather than that of another judge who was being impeached for graft. It was lucky for the channel that it had not aired the wrong image for an hour, as in that case, the penalty may have exceeded Rs 1,000 crore. Needless to say, the verdict has become a Damocles Sword on the media, scaring it away from exposes for fear of the evidence in its possession being not comprehensive enough in an age of opaque governance to satisfy courts in a country where “criminal defamation” is still legal.

Free speech can be annoying and sometimes troubling. However, it is part of the price paid by individual citizens for belonging to a democracy. In the Knowledge Era, an atmosphere of freedom is crucial for innovation and creative expression.

India can lead the globe in the creative arts, and in the innovative genius that creates a tech giant. But for that to happen, the unreasonable use of the “reasonable restriction” clause concerning freedom of speech — put there by “Father of Democracy” Jawaharlal Nehru to dilute freedoms — needs to be curbed. This is best accomplished by the Supreme Court of India. Over to you, Mr Chief Justice.

Sunday 17 January 2016

Hillary to repeat 2008 defeat in 2016 (Pakistan Observer)

On July 31,2015 in this newspaper, this columnist drew scorn among other US-watchers by suggesting that the 2016 Presidential race in the US could be a “battle of extremes” between billionaire Donald Trump and “Democratic Socialist” Bernie Sanders. From the start of the present election cycle in the world’s most powerful country, these columns have expressed doubts over the sustainability of the Hillary Clinton campaign, and predicted that it would end in defeat. This caused some scorn and much anger among the many within the media and in academe who regarded it as fore-ordained that the spouse of William Jefferson Clinton would romp her way to the Democratic Party nomination. 

More than the fact that her husband indulged Wall Street while he was President, it is the insult-filled campaign Hillary waged against Barack Obama in 2008 that has cast a shadow over her chances at the nomination. The impression which the party gleaned of the former First Lady was that of a ruthless pol whose ideology was simply power, high office secured any which way. Of course, she had a fearsome machine on her side, well-paid professionals primed to take down opponents and to promote their candidate.

The Clintons are not known to take prisoners, and those who display any symptoms of disloyalty are almost always punished in a manner that makes clear that such a fate has been caused by their “disloyalty” to the Clintons, which in Clinton speak means backing any candidate other than those promoted by Hillary and Bill. If Bernie Sanders escaped till recently the full dose of the toxicity of the Clinton attack machine, as indeed did Donald Trump, it was the view within their confidants that the Senator from Vermont was a joke who would fizzle out in the final stretch, while Trump was seen as the ideal Republican candidate to go head-to-head against Hillary. That they would both emerge as strong contenders for the Republican and Democratic nominations never entered into the Clinton calculus.

Interestingly, as in 2008 until it became clear that Barack Obama had an edge over Hillary Clinton among white voters in the party primaries, the African-American community has been the most loyal support group of the former First Lady of the United States. This is despite the fact that most of President Clinton’s support for the community comprised of hot air, with few additional benefits flowing to African-Americans, a talented group of individuals short-changed by a system which handicaps all of them because of the misdeeds of a few.

Interestingly, although John F Kennedy did very little for Black Americans while Lyndon Baines Johnson did much, it is the form who is idolised by African Americans rather than the latter. Just as the Taliban had its roots in the Clinton administration beginning 1993, so did the 2008 financial crash, which was caused by the abolition of Glass-Steagal and other Wall Street-constraining laws imposed in the US during the 1930s after the collapse of 1929. George W Bush carried forward the Clinton legacy, thereby precipitating the 2008 crash which wiped out $ 6 trillion of investor value owing to the greed of a handful of financial institutions, which today have got back much of the influence they had before the financial catastrophe. 

Judging by his campaign rhetoric, it was expected that Barack Obama would ensure that those guilty of the theft of trillions of dollars from the pockets of millions of investors would be prosecuted and their fortunes seized as penalty for the dishonesty and greed shown by them. Instead, in his first term, he followed the path of Bill Clinton and gave a free pass to Wall Street, appointing apologists for the billionaires in key positions in his administration and keeping out almost all the idealists who had powered his run to power. Hopefully these financial depredators will open their wallets for the Barack Hussain Obama Library that will be set up once a new President of the United States gets sworn in on January 20,2017.

That would be Obama’s reward for having ensured immunity to those who have brought the global economy to the edge of collapse. Of course, it needs to be added that in Jack Lew, President Obama appointed a Treasury Secretary whose integrity is beyond question, and who - unlike his predecessor- prefers Main Street to Wall Street. Had Obama Mark II emerged in his first term, the political and economic history of the US would have been different. The absence of accountability for the 2008 financial disaster gave the Republican Party an opportunity to dust away its responsibility for the crash and portray the afflictions created by it as being the creation of the Obama administration rather than that of its immediate predecessors. With her eye on the 2016 Presidential race, Hillary Clinton sought to improve her credentials as a policymaker by strong-arming Obama into giving her the prize job of Secretary of State. Subsequently, she stepped down soon after the 2012 elections in order to prepare for her bid at the top job in the world, that held by the occupant of the Oval Office. Unfortunately for Hillary, the bad decisions she took have established that Hillary Clinton is unsuited for taking the 3am phone call, or indeed a 3pm call in the White House. Whether it was accelerating the 2011 changes in Egypt, Libya or Syria, the legacy of Hillary Clinton is a much more unsafe world and a more unsafe US. 

The temperamental flaws which led to such toxic policy plus the negative perceptions about lack of sincerity and connect with the average voter caused by the failed campaign against Obama are likely to lead to either her defeat in the Democratic Party primaries or in the November elections. US citizens are by and large very decent people, who turn away from the extreme hunger for high office displayed by Hillary Clinton. And what would be the forecast for a Trump versus Sanders battle? Should the US economy still balk at visibly improving the lives of the poor and the middle classes, it would be the Democratic Socialist rather than the billionaire who has the edge. However, if better times dawn, ironically voters may turn to Trump, despite his being from the same party as George W Bush, the man responsible for completing the destruction begun by Bill Clinton.

—The writer is Vice-Chair, Manipal Advanced Research Group, UNESCO Peace Chair & Professor of Geopolitics, Manipal University, Haryana State, India.

Monday 11 January 2016

Pak GHQ targets PM Modi through terror attacks (Sunday Guardian)

‘Pathankot is only the first in what will be a chain of incidents designed to discredit the India story.’
Despite the denials coming out of Pakistan, experts in key frontline states against terror say that their preliminary investigations into the involvement of GHQ Rawalpindi, Pakistan in the 1 January 2016 terror attack on the Pathankot airbase “conclusively show” that the optimists who believed that the Pakistan army higher command supported Prime Minister Nawaz Sharif’s stated policy of detente with India, are “flat out wrong”. On the contrary, they say that the Pathankot attack is only the first in what will be a chain of incidents designed to discredit the India story to global investors, and domestically seek to trip Prime Minister Narendra Modi as a leader capable of ensuring the safety and security of India. “Unlike most Indian Prime Ministers, Modi has the will to exercise the option of conflict, and this has unnerved GHQ, which has been used to spineless leaders in the past”, a source based out of London said. A colleague added that “GHQ has received multiple inputs that the new government is not tied to the pacifist approach of its immediate predecessors, and this is worrying the generals”. 
“Unlike what media reports portray, the Pathankot operation was not about destroying Indian Air Force assets, but about killing personnel, and thereby showing that security measures were ineffective”, a source based in the US claimed, adding that “the equipment given to the terrorists showed such an intent rather than a focus on the destruction of air assets”. Another expert warned that “several squads have infiltrated into India during the past four months through the narcotics-hawala channel”, and that those responsible for the Pathankot operation were only one of them. While there has been much praise of the National Security Guard (NSG) in the Indian media, analysts outside are less complimentary, pointing out that “the NSG officer placed in charge of the counter-terrorist operation in the Air Force base was from a tank regiment, and hence lacked the commando or infantry experience needed to tackle such a station”. A US expert judged the present Director General (DG) of the NSG, R.C. Tayal to be “a political appointee rather than a professional choice”. However, this is disputed by sources within India, who say that the DG is an “outstanding counter-terrorism specialist”.
The outside sources were unanimous that Nawaz Sharif “is the weakest Prime Minister since M.K. Junejo (who held the post under General Zia-ul-Haq)” and therefore “to expect Nawaz Sharif to rein in GHQ and its ancillary, the ISI, is futile”. No information has emerged from either Islamabad or Delhi about the specifics of the meeting in Bangkok between Pakistan National Security Advisor N.K. Janjua and his Indian counterpart Ajit Doval. A source in London, however, claimed that Janjua “assured Doval, PMO advisor Asif Ibrahim and Foreign Secretary S. Jaishankar that the Pakistan army higher command was behind Nawaz Sharif and also that both the Sharifs (PM and Chief of Army Staff) were sincere in seeking peace with India”. The impression sought to be conveyed through the meeting was that “the Pakistan army was on board in taking steps to ensure that terror operations against India that originated in Pakistan ceased”. However, a high level source in Delhi said that “it was certain that Doval, with his vast experience, would not have believed his Pakistani counterpart’s assurances of good conduct”. He pointed out that the present chief of RAW “was specifically chosen by Doval because of his expertise with Pakistan”, thereby underlining the centrality of that country in the national security calculus of the present NSA. External sources tracking GHQ Rawalpindi confirmed that Janjua would say “only what General Raheel Sharif wanted him to say”, which was “to distance GHQ from terror operations in India despite the continued backing given to such groups on the excuse that they are related to Kashmir”.
The experts spoken to said that Prime Minister Modi’s lightning decision to call upon Nawaz Sharif on his birthday was a “masterstroke”, in that “it removed any lingering impression that he (PM Modi) was a warmonger”. The visit ensured that PM Modi “has been shown across the globe to be a leader sincere about peace with Pakistan”. However, they added that “although PM Modi must have known that Sharif was powerless to influence operations against India, he decided to show his support for the civilian authority (in Pakistan) and to peace”. A source in the US claimed that the national security establishment in Kabul was “very unhappy at the Lahore stopover, as they had given Prime Minister Modi a detailed dossier on the hostile actions of GHQ against Afghanistan and India”, and was, therefore, “taken by surprise at the Prime Minister’s decision to stop over in Lahore before reaching Delhi”. A special aircraft had been sent to Moscow to take PM Modi from there to Kabul, as the usual Air India jumbo aircraft “lacked the means to ensure safety in hostile skies”. According to sources in Delhi, the PM travelled in this second (and smaller) aircraft from Moscow to Kabul and from there to Delhi via Lahore. 
Apart from GHQ’s assessment that Prime Minister Modi would “stop at nothing” where action against Pakistan-based terror groups was conceded, and, therefore, needed to be discredited in the public mind through terror attacks, “GHQ Rawalpindi was also gravely concerned about the diplomatic breakthrough achieved (by Modi) on the US front”, as well as the PM’s skill in “balancing relations with China and Russia”. Such successes resulted in the plan to “provoke a reaction early in the BJP regime, when Pakistan is better prepared to respond rather than later, when economic and diplomatic successes may further tilt the scales in favour of India”, an outside source claimed. He added that “Pathankot was the result of such a plan” and warned that “this is just the beginning”, and that more such attacks would take place “to test Prime Minister Modi”. These attacks would be undertaken by local modules so that there would be no apparent trace of involvement from across the border. If the PM responds with conventional force, “he would lose international support”, and enter on a conflict with an indeterminate outcome, “thereby affecting his economic plans, especially that of securing huge investments from abroad”. But if he remains passive, “Modi would lose domestic support”. The calculation of General Raheel Shaif is that “either way Modi loses”, and that “the Pakistan army has prepared strategies for an Indian attack together with its ongoing terror operations with India, but are worried that a period of stability may see India growing too big in military strength for Pakistan to counter”. They claimed that General Raheel Sharif, the present Chief of Army Staff (COAS), is determined to “punish India” for the 1971 war, and to “win concessions on Kashmir that would go far beyond any offered by previous Prime Ministers of India”, and that he believed that “only terror would force the Indian side to seriously negotiate”, despite “public utterances to the contrary”.
According to a US source, General Sharif is “as powerful as Musharraf was in his time”. He pointed out that the COAS had “visited Kabul multiple times in full military uniform and met Presdent Ashraf Ghani to demonstrate who controlled policy towards Afghanistan in Pakistan”. A London-based source said that “General Sharif was received with Cabinet-level honours in China, the US and even Russia”, pointing out that China had given the Pakistan side advanced Ju-17 aircraft, while Russia had broken with earlier policy and supplied MI 35 attack helicopters to Pakistan after General Sharif’s visit to Moscow. Another source said that the Pakistan side had made a careful study of the Indian response to the Pathankot attack, and pointed out that on the five recent occasions when military installations were attacked by the Tehreek-e-Taliban Pakistan, the Pakistan army had cleared the area “within 6 to 19 hours”, in contrast to the Indian side, which took three days before an “all clear” was sounded at Pathankot.  Outside sources warned that “GHQ has received confusing signals from some on the Indian side that Delhi was ready to launch into serious discussions on Kashmir and other issues, especially on Siachen and Sir Creek, on the lines followed by the A.B. Vajpayee government” and that “such a signal has whetted their appetite for concessions”. They say that “domestic terror networks have been set up in India that will communicate not with handlers in Pakistan but in West Asia”, and that “these are being activated to launch terror operations across India”, in which the Pakistan signature is absent, “but which form part of the overall GHQ plan to discredit and weaken Prime Minister Narendra Modi and derail his plans for the economy”. Pathankot was just a “test run for a new template of operations against India”, in their view, and the Indian security establishment needs to brace for more, “no matter what the diplomats from Islamabad or their apologists say”. After Punjab in the 1980s and Kashmir in the 1990s, GHQ is “fine-tuning a pan-Indian strategy involving local proxies” in their drive to ensure that India under PM Modi fails to reach its potential. Interestingly, other components of this strategy include ongoing efforts to discredit India globally as being a hotbed of fanaticism and intolerance, and as a country where minorities, women and the underprivileged are not safe. “All such covert tracks filled with disinformation will accelerate in the coming months, in locations across the globe”, even while India confronts a fresh round of terror designed to slow down its trajectory towards Middle Income status.

Delhi’s ‘Odd-Even’ scheme is about more than pollution (Sunday Guardian)

It may be debatable whether pollution levels have dropped, but it is undeniable that it has made several citizens examine options such as car pooling or the Metro.

Given the fevered state of politics in India, it was no surprise that a flurry of invective greeted Delhi Chief Minister Arvind Kejriwal’s sudden decision to restrict cars on the road on specific days depending on their registration numbers. Days after the “temporary” measure was initiated, studies have emerged that show that there has been only a small dip in pollution levels in Delhi consequent to the measure. Certainly, the restriction on “Odd Even” private cars driven by males will not by itself do much to reduce the smog that is draining the lungs of those unfortunate enough to live in a city which has become overcrowded and increasingly dishevelled. Given that decision to retain Delhi as the capital, it would have made sense to ensure that industrial units not get located in or around the city, so that its congestion may ease. Or avoid the use of so much land within city limits in the building of residential accommodation rather than be kept as open space.
Behind Arvind Kejriwal’s coughs and the sniffles lurks a ruthless power seeker focused on taking over the top slot in government, the corner office in South Block now occupied by Narendra Modi. In place of the relaxed culture of the Aam Aadmi Party during its early months of existence, Arvind Kejriwal today has as much control over his party as Sonia Gandhi has in hers. However, none of this detracts from the fact that overall, and despite the limitations imposed by its lack of powers over such matters as the NDMC, the police and Delhi-centric bodies such as the DDA, the AAP has acquitted itself rather better than several other state governments have. The volume of corruption seems lower than in many other parts of the country, and the taste for innovative ideas higher. Unfortunately for federalism, the Union Home Ministry seems to have made it its mission and its mandate to hound and harass the Delhi government, a task in which it has the enthusiastic cooperation of the Lt-Governor of Delhi. If only Najeeb Jung were to spend less time blocking policy initiatives and devote more attention to suggesting ways by which the citizenry in Delhi may be benefited, he would not seem so partisan. Indeed, a parallel to Jung would be the Congress-appointed Governor of Gujarat during 2009-2014, Kamla Beniwal, who shamelessly implemented a policy of throwing rocks in the path of Chief Minister Modi in his numerous initiatives. The way in which the Lt-Governor and the Union Home Ministry are responding to the Aam Aadmi Party’s overwhelming victory in the 2015 Assembly elections is damaging the name of the Modi government. It needs to be remembered that the Prime Minister himself has in his interactions with the Delhi CM been largely supportive of the steps which the duly elected Delhi government is taking. It has been said before but needs to get repeated that much more harm is being done to the image of PM Modi by his presumed friends than by his obvious foes, the Beniwal-model darts directed against Kejriwal being an example.
A sense of obligation to the community has motivated residents of Delhi into very high levels of obedience to the “Odd Even” scheme, and it should be continued after 15 January.
Rather than Page 3 celebrities, the AAP has chosen to take as its mascots ordinary citizens. While a male motorist in Delhi may not suffer any damage to his conscience going against an order enforced by the police, it is a different matter to confront an idealistic teenager, who may the same age as a son or daughter. The deployment of such volunteers has provided a moral force far greater than the earlier images of the rich and the powerful wielding brooms as though they were golf clubs, clearly in a hurry to shuffle around a bit till the cameras moved on. Prime Minister Modi’s call for Swachh Bharat is an initiative of prime importance to the future of this country, and those implementing it need to learn from the “aam aadmi” (rather than celebrity) approach of the Odd-Even campaign. It may be debatable whether pollution levels have dropped after the measure was introduced, but it is undeniable that it has made several citizens examine options such as car pooling or using the Metro rather than choke the roads and burn up imported fuel travelling all by oneself in a huge car. 
A sense of obligation to the community has motivated residents of Delhi into very high levels of obedience to the “Odd Even” scheme, and for this reason alone, it should be continued rather than abandoned on 15 January. Indeed, more initiatives need to be taken, such as making more stretches of road off limits for vehicular traffic, or ensuring “bicycle only” paths, that would promote alternatives to cars and other polluting vehicles. 
The BJP needs to reach out for its mascots beyond Page 3 types to ordinary Indians. Much of the appeal of Prime Minister Modi has come from the fact that he is from a simple, homespun family rather than the elite. In the case of Incredible India, for example, there ought to be several “brand ambassadors”, most from the “common” citizenry, who are the real treasure of this land and who would convince those from outside to visit a country truly unique.


Friday 8 January 2016

Despite crises, oil prices to remain low (Pakistan Observer)

Geopolitical notes from India

M D Nalapat

Friday, January 08, 2016 - THE US Federal Reserve Board acted irresponsibly when it increased the bank rate at its last meeting, even if by only 25 basis points, thereby indicating that further rises were on the horizon. This columnist had expected rates to be stable at their present near-zero level, because overall economic situation was still very grim, and the US recovery fragile. Also, Janet Yellen (Chairperson of the Federal Reserve) is a favourite of President Barack Obama, and was expected to not take risks with economic growth by raising rates. Should there be economic turmoil, a paradoxical result will be that the Republican Party will make its way into the White House next January, even though it is the economic philosophy of that party which has exacerbated the economic crisis facing the US, a country where the middle class is shrinking, the poor are in despair and only the super rich are doing well. 

In his first term in office, Barack Obama was faithful to the Bill Clinton line, which is in many respects a Republican Lite policy where economics is concerned. He indulged Wall Street and ensured that those responsible for the 2008 financial crash evaded punishment. Even in his second term, Obama has been faithful to lobbies such as Big Pharma, blocking cheaper drugs from outside the US that can save millions of lives throughout the world. However, he has raised taxes on the super rich from the low levels that were the case under George W Bush, who made no secret of the fact that he was elected to serve only the interests of those who had at least a million dollars in the bank. Janet Yellen must be aware of the fact that the Federal Reserve needs to ensure that growth in the US be safeguarded rather than damaged by the sort of adherence to textbook economics that is seen in India, where Reserve Bank of India Governor Raghuram Rajan has killed manufacturing by artificially boosting interest rates, even as the Finance Ministry has damaged the services sector through higher and higher taxes. 

Both at the Reserve Bank as well as the Finance Ministry, the intellectual input comes from those who have been steeped in US textbooks, and who assume that the Indian economy is no different from that of the US, or at the least should not be different. They have created a policy matrix which goes counter to what is needed at the ground level, and as a consequence, are slowly smothering domestic industry in India. More than any other cause, it is faulty policy that is doing the most harm to the future of India and its 1.26 billion people. While Prime Minister Narendra Modi has been innovative in his foreign policy, in economic policy he has adopted a cautious and conservative approach, which is why the rate of growth of the economy has been falling steadily throughout his term in office, even though it is still higher than that of any other major economy. 

The reality is that India needs 10-12% annual growth to ensure social stability, and the present 7% rate is simply not enough. Interestingly, despite his disastrous record at the Reserve Bank of India (where he has seen banks pile up bad loans and industrial units slowing down), there is talk that Raghuram Rajan may be the next Union Finance Minister, clearly a tribute to his friends in Washington and New York and their expanding influence in India. The factor which has prevented a slide in the Indian economy is the fall in oil prices, which has meant a saving of $26 billion thus far and counting. This windfall has ensured that the ill effects of policy by the Reserve Bank of India and the Union Ministry of Finance have been muted. The government has not shared its gains with the people, keeping the retail price of petroleum products high so as to benefit oil companies as well as the exchequer, and in the process driving up prices, thereby giving Raghuram Rajan the excuse he has been looking for to not cut interest rates by the 3-5% needed to ensure double digit growth. 

The fact of high taxes, high prices and low job creation is what is causing the BJP to get defeated in election after election, even in its strongholds of Madhya Pradesh and Gujarat, where at the rate the party is declining, the Congress Party may return to power in the next state elections, due in a year. Indeed, the failure of the BJP to ensure innovative economic policies, combined with the fact that no action has been taken by the Narendra Modi government on those responsible for corruption during the Manmohan Decade (2004-2014), has led to a visible lack of enthusiasm for the central government that contrasts with the wave of popularity which greeted the coming to office of Narendra Modi in May 2014 However, Prime Minister Modi has been a lucky individual, rising from a humble start in life to becoming an international statesperson known across the world. 

Although there are crises aplenty in the Middle East (or what is called West Asia), these are not expected to have much effect on the price of oil, which is settling at the level of $ 30 a barrel that this columnist had years ago indicated as the correct price if market fundamentals were given full play. The speed with which alternative energy technologies are developing is combining with technological improvements in shale oil extraction to ensure that there is almost zero chance of oil prices breaking through the $ 50 barrier. It is more likely that prices will remain around the $ 30 level, especially in view of the Chinese economy showing significant strain. The drive against corruption by President Xi Jinping as led to a flight of capital from China, while officials are wary of taking decisions at anywhere close to the speed found in the past, for fear that they will be accused of taking bribes. Overall, the official machinery in China is working at a much slower speed than in the past, when there indeed was corruption, but also efficiency. 

Today there is neither corruption nor efficiency, thereby making it imperative for President Xi to work out a way by which officials will once again feel confident enough to take bold decisions speedily. Overall, the outlook for China remains gloomy, as it does for Europe Economics is key in the modern world, where people expect the government to provide a better life. Those governments that fail to do so become unpopular, while those who succeed in boosting growth become popular. The fall in oil prices has created an opportunity for countries heavily dependent on imports of oil, such as India and China. But for the fall in oil prices, their situation would have been much worse than it is. However, unless wiser policies get worked out and implemented in both countries, such windfall gains will go waste.

—The writer is Vice-Chair, Manipal Advanced Research Group, UNESCO Peace Chair & Professor of Geopolitics, Manipal University, Haryana State, India.

Monday 4 January 2016

Modi must reclaim economic policy from North Block babus (Sunday Guardian)

Since coming to office last year, there has been a visible duality about the Narendra Modi government. This is the difference between foreign policy and economic management. In the first, it is clearly Modi who is driving the process, willing to take risks and to brave criticism from the usual talking heads. Under the hyper-cautious Manmohan Singh, relations with Bangladesh, Pakistan, Nepal, the Maldives and Sri Lanka worsened, while today, each is not merely on the mend, but significantly better. Even Pakistan has altered its approach, such that there is finally some expectation that the men in khaki will accept that only good relations with India can rescue their country from the abyss into which adventurous policies have pushed it. Regrettably, it is now Turkey, which is following the same course as has been adopted since the time General Zia-ul-Haq took over as the Chief Martial Law Administrator, and it is a certainty that a country seeking to be fully European will, in coming years, follow the same dismal trajectory of India’s western neighbour, only worse. Turkey is headed towards the same civil war which Recip Tayyip Erdogan has fuelled in Syria, as well as the societal chaos of Iraq because of its involvement in ethnic and sectarian divisions within the Arab world. Should Pakistan follow the policy of Bangladesh and follow a policy of partnership, rather than hostility with India, its economy would once again cross into the high growth range that was the norm till Zia took office. 
These days, even cartoonists in major global publications add Narendra Modi to their images while sketching the major global players. The Prime Minister of India figures along with such fixtures as Barack Obama, Xi Jinping and Angela Merkel, in a sign that India under Modi has been accepted as part of the High Table of international diplomacy in a way not seen since the days of Jawaharlal Nehru. Chronic Modi-baiters (or closet Modi-haters) may dismiss as theatre his NRI excursions, but it cannot be denied that since 26 May 2014, whether in the US or in China, in Japan or in the UK, there is a buzz and a momentum around India that can translate into huge investments of capital, but only provided the economic part of the Modi agenda exhibit the same drive and innovative spirit that the foreign policy component shows in such profusion. Although North Block babus claim otherwise, to those outside the portals of government, the last two budgets have seemed more Manmohanish than Modi-fied. Narasimha Rao pushed through a raft of reforms during the first hundred days of his term, although Finance Minister Manmohan Singh diluted the effect by ensuring lower taxes on imports and on foreign companies while keeping rates high for domestic taxpayers and industry. Manmohan Singh, in common with the babus of North Block, has an intense dislike of alleviating the pain felt by Indian taxpayers, and this bias was visible in each of his budgets, as well as in those presented during his ten years as Prime Minister. It was only Narasimha Rao’s command that taxpayers should be treated “gently and fairly” that ensured that he did not enter upon the regressive “Police Constable” approach of P. Chidambaram, who, in the guise of going after unaccounted income, instituted a reign of terror that has resulted in tens of thousands of India’s most productive prospective entrepreneurs migrating to Singapore and other offshore locations, rather than continue in a location where they were harassed as criminals for the crime of running successful enterprises which challenged international competitors. 
It was this columnist who first described Narendra Modi (during his visit to China as Chief Minister of Gujarat) as India’s answer to Deng Xiaoping. From almost the start of his ascension to leadership in the PRC, Deng ensured a rate of growth double that of India’s in the present. Those who complacently — even boastfully — talk of the current 7% growth rate as proof of excellence need to know that the Modi Standard mandates double digit growth, and that anything below that is simply not enough. For this to happen, what is needed is to eliminate a boatload of restrictions created only for the purpose of extracting bribes, and which collectively make India a country where only masochists enjoy setting up a business. Taxes need to be reduced, so that the economy can expand and thereby fill coffers in a more plentiful way than higher imposts on an inadequately rising base of services and manufacturing. And as for black money, Deng’s words (“it does not matter if a cat is black or white, so long as it catches mice”) need to be remembered in a context where the generation of black money remains high, but its expenditure on taxed items is falling rather than rising. 
Raghuram Rajan and Arvind Subramanian clearly believe that within a year, all of India will embrace credit cards in place of cash, preferably those originating in the US. 
Certainly, innovations such as the Jan Dhan Yojana will speed up the role of banks and credit cards, but in the meantime, the domestic consumption vital for job creation should not be stifled by edicts such as making PAN cards compulsory for a range of transactions in a country where less than a tenth of the population have these bits of plastic. 
Just as he has so visibly shown in the field of foreign policy, Narendra Modi needs to take command of economic policy away from the babus of North Block into his own hands and his own genius. The next budget needs to reflect the reality of economic life in India, not the US, for a failure to do so would cast a shadow over expectations of performance for the remaining three years of the BJP’s term in office. 
Fiscal consolidation can only happen in a climate where growth becomes the driver of policy, and for this to happen, Prime Minister Modi needs to imprint his personal stamp on economic policy the way he has in foreign affairs.