Saturday 30 May 2020

Eid Shows Tablighis Do Not Represent India's Muslims ( Sunday Guardian)

Eid was observed this year in homes, rather than in massive congregations.

The internet was meant to be a pathway to the world. Conversations can take place across time zones in real time, although it has taken the restrictions imposed during the Covid-19 pandemic to teach even Silicon Valley that the earlier insistence on staff working from offices was an error. The giants of the virtual world—Google, Amazon, Netflix, Baidu, Alibaba, to name a few—had to either follow manufacturing industries in shutting up shop temporarily or to allow the bulk of their employees to work from home. Surprisingly for those whose habits of thought remain moored to those acquired across generations, the work proffered by those at home often turned out to be better than when they were in their offices. A minister during the A.B. Vajpayee era began the still ongoing process of seeking to police the Information Technology (IT) industry in India the way other industries had long been. Some corporates that had flourished under Licence Raj began Information Technology outfits. Staff associated with the creation of software were asked to report for work punctually every morning (or get their salaries docked), leave only after office hours and wear ties and preferably a suit as well while at work. Needless to say, such corporates fared poorly. It is not an accident that the wearing of suits (or even jackets) is regarded with some disdain in locations where the Knowledge Industry flourishes. After all, who would want to put on such an uncomfortable garb if there were no compulsion to do so? The IT industry in India grew exponentially until the Vajpayee and Manmohan Singh governments sought to regulate it in a manner that included the criminalization of several outcomes in which internet platforms as such had no responsibility. Despite the laws and regulations proscribing “hate speech” (itself a somewhat diffuse term), webspace has witnessed a tendency for those having similar likes—and dislikes—to cluster around only each other. Through the consequent magnification of the echo of their views, several of their prejudices get embedded in their reasoning.

Among many netizens was the reflexive belief that Muslims in India are represented by the adherents of the Tablighi Jamaat (which managed to escape the eagle eye of the authorities to held a mammoth indoor rally in the heart of the national capital, with unfortunate consequences for the battle against Covid-19). The fact is that Tablighis represent only a tiny proportion of Muslims, although the way most of the community remained silent about the behaviour of some of the members of that group led to such a fact not being as obvious to the larger public as it ought to have been. However, Eid, the close of the period of Ramzan, showed India’s Muslims to be as conscientious about public health as any other community. The observance of Eid-ul-Fitr this year overwhelmingly took place in homes, rather than in massive congregations as previously. And in a welcome break from a tradition that has not been sanctioned in the Holy Quran (women and men being separated for prayer), women and men prayed together in several homes, often for the first time. Several individuals gave to the poor the moneys saved through the absence of the lavish Iftar parties that had been a staple of the past. Both these changes in past practice deserve to be continued even in a situation where the novel coronavirus may no longer be the public health threat that the WHO (somewhat belatedly) proclaimed it to be. In a country which in many regions regarded the education of women as a waste of money, time and effort, Muslim women are joining their sisters of other faiths in filling schools and colleges. Several have distinguished themselves, including in fields such as medicine and engineering. This is a world away from the vision of the Taliban or their ideological cousins in other parts of the world, who believe that a woman’s place is in the home, when not being made to do back-breaking work in the fields or elsewhere. Despite the continuation of the Great Indian Lockdown to (at least) the close of this month, many had believed that large groups of people would assemble and gather outside their homes in order to celebrate the end of the period of fasting. Instead, across India, Muslims remained at home during that day, acting no differently from Hindus, Christians, Buddhists, Sikhs and those of other faiths. They behaved in the manner good citizens are expected to, by obeying the rules of the lockdown and ensuring social distancing. If the images appearing on television screens about the doings even in hospital wards of some of those who had attended the New Delhi Tablighi Jamaat meeting are accurate, such was the opposite of the behaviour of a community that numbers nearly 200 million across India. Fortunately, such individuals are not taken as role models but as a fringe group by India’s Muslims.

Whether it be the world of cinema, education, business or literature—or in diverse other fields—Muslims in India have excelled, both men and women. The restraint and dignity shown by them during Eid proves the point that the people of India ought never to have been divided on the basis of faith. Such a division was sought (and successfully implemented) by Winston Churchill, Conrad Corfield and other backers of colonialism in their attempts to permanently weaken the people of the subcontinent through fragmentation.

Tuesday 26 May 2020

Asia is Now the Global Geopolitical Center, It's Time For an Indo-Pacific Charter (Japan Forward)

Two months after Hitler invaded the Soviet Union, on August 14, 1941, the heads of government of the United States and the United Kingdom issued the Atlantic Charter, a set of principles that were intended to define the world order after the eventual defeat of Nazi Germany.

The principles enshrined in the Atlantic Charter inspired a set of organizations and structures that are still in existence today. On January 1, 1942, the nations fighting the 1939-1945 war together gave a call for what was to become, on October 24, 1945, the United Nations Organization. 

Four years later, the North Atlantic Treaty Organization (NATO) was formed to deter the Soviet Union from invading and occupying countries in Europe outside the Iron Curtain that laid across the dividing line between Soviet satellite states in Europe and other countries in a continent that had dominated world history for close to six centuries.

Although Winston Churchill, the then-prime minister of the U.K., did not favor giving the freedoms enunciated in the Atlantic Charter to European colonies in Asia and Africa, such a narrow view of human freedom was opposed by U.S. President Franklin D. Roosevelt throughout the war years. The torch of liberty that was lit in the minds and hearts of millions in Asia through the Atlantic Charter and the UNO ensured that European colonization was rolled back across the world’s largest continent, ending with the handover of Macau to China by the Portuguese on December 20, 1999.

By then, the balance of geopolitics was shifting from the West to the East, but the organizations and structures weren’t adapting. That same year, India’s first professor of geopolitics enunciated the concept of an “Asian NATO,” a security alliance of countries in Asia determined to resist outside efforts at dominating them. This Asian version of NATO did not find favor with European powers, who were insistent that their own military alliance was sufficient to tilt the balance of forces in Asia, the way they used to during the period of European colonization.

Well after it was clear that Asia was outpacing Europe in the economic and later the technological spheres, they continued to insist on the primacy of the Atlanticist world view, which holds that the Atlantic is still the geopolitical global center of gravity. In fact, by 1999 that honor had returned to Asia.

In the U.S., the powerful Atlanticist lobby sabotaged efforts by a section of the Pentagon to shift Washington’s focus from Europe to Asia. It is an effort that has continued into the Trump administration, where a substantial section of policy makers and the media have teamed up to insist that the Atlantic remain the center of gravity of U.S. foreign and security policy, making it remain Moscow-centric at a time when Beijing has far outstripped that capital in terms of growth and potential for power projection
 Enshrining Freedom and Democracy in Asia
 Rather than assume that Asians are incapable of looking after their own security without European assistance, what is needed is for Asian countries to come together with North America ― a continent that has never sought colonies ― to form an Indo-Pacific Charter on the lines of the Atlantic Charter.

Japan and India are required to lead such an effort, together with the U.S. The Indo-Pacific Charter would call for the protection of existing boundaries across Asia, opposing efforts at changing such a status quo by force. It would call for the elimination of hegemony and dominance of smaller and weaker countries in Asia by more powerful entities. And it would set up a security and defense mechanism for that purpose which would include Japan, India, the U.S., Australia, and Canada besides other like-minded countries.

This organization would jointly defend any member or allied power in Asia against an effort to change the status quo by the use of force. The Indo-Pacific Charter would enshrine the importance of freedom and democracy, and call for all states to ensure that such universal values are protected within their boundaries and not trampled upon.

Such a charter would recognize that the torch has passed from the Atlantic to the Indo-Pacific, and that for the U.S. in particular, the most significant allies of the future are no longer France and Germany, but Japan and India.

The countries subscribing to the Indo-Pacific Charter would come to the defense of any other country facing a threat to its sovereignty by force of arms. It would also safeguard crucial sea and air lanes as global commons across the continent so as to ensure free communication and commerce, unhampered by any hostile force.
 Keeping the Peace
 Such a coming together of great democracies would ensure that a superpower war does not break out in the continent.

Just as war between the U.S. and the USSR was avoided throughout the Cold War, war between China and the U.S. needs to be avoided. This can only happen if a deterrent force is created that will oppose efforts at changing the status quo by force. Peace has been kept in Europe for decades, barring a few smaller and largely internecine conflicts, since 1945.

The task before humanity is to similarly keep the peace in Asia. The time for an Indo-Pacific Charter is now.
 Below are the potential points of an Indo-Pacific Charter update of the Atlantic Charter: 
  1. No territorial gains to be sought by any major power.
  2. No creation of artificial territories in the open seas.
  3. No acquisitions by force or lease of new territories within sovereign nations.
  4. Re-formation of the U.N. Security Council or formation of a new Indo-Pacific Security Council.
  5. Participants will work towards freedom and sovereignty of data.
  6. Participants will work towards a unified approach to using Artificial Intelligence for the good of humanity.
  7. Formation of a Space Security Council.
  8. Participants work together to promote democracy and participatory government.
  9. Nations that are democracies stay as democracies.

Saturday 23 May 2020

Bill Gates Bats for the Great Indian Lockdown (Sunday Guardian)

The lockdown has had visible effects on both society and economy. It is unclear how long it will take to get production lines and services back to pre-lockdown levels.

New Delhi: The most comprehensive and total lockdown in history has been ongoing in India from 25 March. The aim of Prime Minister Narendra Modi, when he cogitated on the Great Indian Lockdown (GIL) and finally implemented it was obvious. It was to protect as many individuals as possible of the 1.29 billion citizens of the world’s future third superpower from the millions of deaths that a battery of experts had publicly warned was inevitable in the absence of such a drastic measure, one not reproduced in any other country. In the rest of the “locked down” world, the degree of lockdown varies from 30% to 70%. Some have avoided a lockdown altogether, relying on social distancing and enhanced personal hygiene to keep mortality rates low. In India, where even a single Covid-19 case has been discovered, facilities (including medical) have been shut down, so comprehensive is the safety protocol. The disease is being treated as though it has a mortality rate of 90% even though the actual death rate is far lower. Being a leader who cares, Prime Minister Narendra Damodardas Modi clearly decided to exercise caution rather than take chances in a matter where so many lives were at risk. And there were those who said three months ago that governance in India was so leaky and inefficient that such a strong measure as a comprehensive nationwide lockdown could never be implemented. Hence, that a catastrophe in the form of millions of coronavirus-related deaths would be “inevitable by the month of May”, and that the deadly curve would continue to rise for much of 2020. The people of India proved such forecasts wrong. They trusted in Prime Minister Narendra Modi and obeyed the lockdown order he issued without significant demur, just as they had stoically accepted the 8 November 2016 demonetisation of 86% of the country’s currency at just four hours’ notice, that too after office hours.

The Great Indian Lockdown (GIL) has had visible effects on both society as well as the economy. It is unclear how long it will take to get production lines and services back to pre-lockdown levels, given the widespread disruption that the measure has caused. Estimates of job losses go into figures never before even imagined as possible in the history of the Republic of India. Given his studied style of functioning, PM Modi would have cogitated over the lockdown measure and discussed it at length with experts and officials before ordering the GIL. At that point in time, an army of academics and medical specialists were originating and recycling information, some of which got mixed with both misinformation and disinformation. The effect was to create an atmosphere through the media such as would ensure the compliance of the population with the complete lockdown for whatever length of time such a move was deemed to be essential by the Prime Minister and his advisors on the subject. Among the reported proponents of such a never-before-attempted measure was Bill Gates. The founder of Microsoft has become an ubiquitous influence in the global health industry, and as such, his apparent recommendation in favour of a comprehensive lockdown wherever the novel coronavirus made an appearance would have been extraordinarily persuasive. At the same time, the leadership of the prestigious Indian Council of Medical Research (ICMR) seems to have been unanimous in urging just such the lockdown. The head of the Bill & Melinda Gates Foundation (BMGF) was among the first international heavyweights to compliment Modi on the Great Indian Lockdown (GIL). Another was the 45th President of the US, Donald Trump and a third was Director-General Tedros of the WHO, who has been associated with Gates for decades.
Policy missteps as well as ineffective communications strategies have given wings to a global effort by interested elements to falsely claim that India under Narendra Modi is evolving into a Germany under Nazi rule. International media outlets running such outlandish comparisons themselves have journalists working in India, who have not allowed the absence of any evidence of such genocide or mass killings of specified groups to deter them from giving a platform to those peddling such falsehoods, or to repeating them in their own columns and reports. In keeping with the running down of not just the government in India but the people, there has emerged an entire industry of lockdown enthusiasts within the world’s institutes, academic bodies and the media that sprang up during March 2020. They continue to make doomsday predictions about the “expected” or “potential” (i.e. hypothetical) effects of the Covid-19 pandemic in order to ensure that the present Great Indian Lockdown continues for an extended period of time. Almost none of such “scientific and fact-based” reports or studies are based on anything other than mathematical models.
Standing in a league much above such individuals in impact is an individual who has (through his inventive mind and business skills) acquired a degree of financial power that few governments across the world can match. Because of the reach this provides, every cause that he promotes immediately becomes a cause celebre throughout the world, studied, and immediately gets talked respectfully by mediapersons, governments and much of the public. He is known as an individual who studies an issue, then makes up his mind, and who has the reputation of indefatigably charging ahead once his mind gets made up on an issue. This instrument of change is Microsoft founder Bill Gates, who may rank among the most influential persons on the planet outside the four leaders of the world’s two present and two future superpowers, Donald J. Trump, Xi Jinping, Narendra Modi and Vladimir Putin.

Bill Gates has within his remit a vast tax-free income with practically no oversight, and has gained the respect and attention of an army of global policymakers and experts who take as gospel the suggestions he makes for governments, media and the public to follow. Wife Melinda is known for her simplicity despite her immense wealth, and for exhibiting a genuine concern for the underprivileged. Melinda Gates is regarded by those in contact with her to be an individual without the societal, political or ethnic biases common to many of those in her societal group.
Unlike Foundations that were created when the founder of a corporation was dead, Gates (assisted by a team carefully chosen by him) controls a huge amount of tax-free money (as well as $30 billion of Warren Buffett’s money) while still relatively young and very active physically. There does not seem to be any Oversight Board supervising the functioning of the Gates Foundation. It would appear that only Bill and Melinda (a couple that have been loyal and close to each other from the start of their relationship) take the investment-related decisions needed to manage the vast sums of money which accrue from their selling Microsoft stock. Much of this is put into the Foundation rather than handed over to their children, as also has been a large chunk of Warren Buffet’s money. The self-effacing Buffet is himself a Trustee of the Bill & Melinda Gates Foundation (BMGF), but is not co-chair and does not seem to be involved in the major decisions of the Foundation concerning which policy to promote or oppose.

So far as global disease vectors are concerned, initially Gates gave $100 million to create an Institute at the University of Washington in Seattle called Institute for Health Metrics and Evaluation (IHME). The founding Board members included Dr Tedros (then Ethiopian Health Minister who is now Director-General of WHO). Thus, they already have an inside track to data from WHO and that UN agency’s associated governments and entities. Health data from Indian Health Ministry may be accessed by the BMGF via WHO, of which Gates has long been a major donor. Information is processed by the Bill and Melinda personal partnership so as to design policies approved by them that would improve the world. Whether all such policies actually accomplish such an ambitious task is a matter yet to be finally decided, at least in some instances. An example is the lockdown policy. Taiwan has had hardly any lockdown, yet has less than 500 Covid-19 cases and very few fatalities. Actual data from countries that have imposed different levels of lockdown do not show any correlation between the extent of a lockdown and the recorded number of cases and fatalities. Meanwhile, the Great Lockdown Theory embraced by both the WHO as well as by the Foundation has caused worldwide economic distress on a scale not seen even in the 1930s except in countries such as Germany during the period of the Weimar Republic. The single track focus on “breaking the chain of infection through lockdown” and thereby “flattening the curve” has caused distress, both financial and societal, on a scale that may not wholly have been factored by Bill and Melinda Gates, who have funded many of those who first came out with alarming figures about likely death tolls from the Covid-19 pandemic. WHO itself has been singularly ineffective in warning the world of the disease before it grew into a devastating pandemic. It is not known whether the Foundation urged a speedier response on Director-General Tedros in the crucial weeks before the WHO finally declared the novel coronavirus to be a global health emergency capable of rapid spread. The respect given to the Gates Foundation and to Gates personally indicates that his views are treated with a high degree of respect, which is why several of the policy prescriptions suggested by him get adopted across the world. Numerous individuals linked to the BMGF are regularly getting placed in important positions, including in the world’s biggest democracies, India and the US.

The Gates Foundation grant to the Institute of Health Metrics & Evaluation (IHME) was renewed. Chris Murray, the Director, decides on the methodology that seems to produce numbers that always fit into existing hypotheses. There does not seem even a semblance of oversight—including by the media—over the numbers that have so prolifically been generated by the IHME. Computer-generated results of the institute are accepted, seemingly without any questioning of the postulates or methodology used to get such results. Gates himself places considerable reliance on its findings. Given the immense respect that BMGF has, it is no surprise that several of those associated with the Foundation have been chosen for senior slots in several multilateral agencies such as WHO, World Bank, etc. There is also an MoU that IHME & Gates has done with WHO for accessing data. Hopefully, universities in India too will gain similar access to WHO data as well as funding from the Bill & Melinda Gates Foundation. Some of this could be used to review existing methodologies used by IHME and other institutions generating similar results, and to suggest alternative options for consideration by the policy community. Having different, indeed clashing, points of view is essential in any scientific enquiry in the post-Galileo age. The Covid-19 fatality numbers generated by grantees of the Gates Foundation (including WHO) seem to have no peer review about the methodology. Except of course by other grantees who seem not to be able to find any fault in the results, not even in conclusions (such as incidence figures in India) that have demonstrably been shown to be wrong. The BMGF may need to go back to the drawing board on some of its assumptions if it is to achieve the vision of Bill and Melinda Gates of being an institution that shines a spotlight revealing pathways to a better world where the underprivileged in particular get the justice that has been denied to them for a very long time.

Bill Gates, through his business acumen, drove into the ground many companies in Silicon Valley in the 1970s, 1980s and 1990s in Microsoft’s ruthless drive for dominance. Today, Gates is on a mission to create improvements in the global health sector. In the US, healthcare is 17% of GDP, and soon it will be above 10% of GDP in all countries (including private spending in healthcare). Large pharma conglomerates have driven policies and products in directions which benefit their shareholders, but which have sent healthcare costs ballooning to levels unaffordable even in the present. In the case of the Covid-19 pandemic, even the merest suggestion of promoting any treatment or method of immunity other than the vaccine route has been torn to pieces by those behind what has become the conventional wisdom in battling the coronavirus. This has emphasized the need for a vaccine as well as the use of ventilators over other methods. This in a world where such technologies are unavailable to much of the population, just as the regular banking system or access to online systems was unavailable in 2016 to hundreds of millions including in India, a country where Bill Gates was an early and enthusiastic backer of demonetisation and the ending of currency as a medium of exchange. As initially implemented by North Block and Mint Road, that far-reaching change in a method of exchange that is the lifeblood of the economy was initially structured in such a manner as to severely impact liquidity across vast swathes of the population, especially in rural areas and in slums. Did the BMGF factor in such operational problems before its founder became a forceful proponent of the plan to replace paper money with digital currency through elimination of the latter via governmental edict?

Over the years, there have been efforts by identifiable interests at stealing through patenting traditional technologies (incorrectly regarded with contempt by Atlanticist experts) and herbal cures. Many such cures may indeed be valueless, and some even harmful. But there would be some that deserve adaptation and dissemination, and what seems to be the obsessive focus of the Foundation on the usual track followed by the pharmaceutical industry in the US and the EU may need change. Other options in healthcare need to be given attention, in particular innovations such as the revival of production of vanishing but essential herbs in greenhouses. If the disappearing pools of traditional knowledge were accessed and harnessed in the search for cures and preventives, the world would likely be a better place. The time may have come for Melinda Gates to persuade her partner to look beyond the BGMF’s usual prescriptions. They need to examine with the open-mindedness of the reformist mind how for example generics could be given a boost so as to lower healthcare costs. India, a country that Bill Gates seems to have a particular affinity for, could serve as the location for much more than vaccine trials. Traditional immunity boosters used over the centuries in China and India may potentially save (at much less cost) many lives, just the way the pills and injections multiplying across the globe do. In an era of Alternative Energy, the time may have arrived for Bill Gates to turn his attention towards the possible development of provable, safe and effective Alternative Medicine in addition to the conventional fields of study already attempted. Human lives are precious, but they need affordable options in order for them to be accessed. This calls for measures other than those relied upon by Big Pharma-centric policies and the often hugely expensive favoured protocols of treatment promoted by the US National Institute of Health, another institution that has received favourable attention from Bill and Melinda Gates. As Sanatan Dharma postulates, there may be many paths to a single goal and not just a single pathway. Hopefully the BMGF will study in detail the full effects of the Great Lockdown as well as the Great Demonetization, both being policies that appear to have received its enthusiastic support. Or that Bill and Melinda will ensure that it study possible alternatives rather than coming to an early conclusion and then making the mathematical models fit the conclusions already arrived at. When Bill Gates speaks, media and policymakers listen. Hence the need for the Foundation to proceed in such a manner that not simply the immediate effects but the “morning after” gets accurately mapped out. The law of unintended consequences must never be forgotten.

Quad Must Announce the Indo-Pacifc Charter ( Sunday Guardian)

The seeds of war between the United States and China are germinating across the Taiwan straits and in newly created atolls of the South China Sea. In Ladakh and in Sikkim, the Peoples Liberation Army (PLA) has accelerated its “Forward Policy”, the same line of action once followed by Prime Minister Jawaharlal Nehru and Defence Minister Krishna Menon. They acted in the belief that the other side would never have the will to go to war against a systematic nibbling away of territory through “aggressive forward patrolling” by the military. The slowing down of the Indian economy since the close of 2016 and the antics of GHQ Rawalpindi may have persuaded the generals in Chengdu that their adoption of the forward policy would have no reciprocal blowback. B.N. Mullick of the IB had calculated that Mao’s difficulties with the Chinese Communist Party leadership and the economic pain China was then enduring would prevent the PLA from responding to the strategy of nibbling away at territory, a few feet at a time. He was wrong. And after what is taking place in Ladakh and Sikkim, the PLA leadership may be in for a surprise. An armed push to a depth of four to five kilometres in two parts of the Sino-Indian border is unacceptable, and may—unlike Doklam—lead to a conflict involving casualties. The Chinese side appears to be placing its faith in the serial (some would say deliberate) errors made by the Lutyens Zone. This network has thus far succeeded in stalling a robust defence and security understanding between India and the US, which is the only other power that can match China. Key elements of progress in this inevitable alliance are trapped through bureaucratic obstruction in a netherworld. The greatest favour that Vladimir Putin can give to Xi Jinping is to keep India from entering into a substantive military alliance with the US. In the past, Pakistan was able to fashion a close alliance with both Beijing and Washington from a time when both capitals were hostile to the other. Once the US and China became de facto allies in 1972, Rawalpindi was in ecstasy. Fortunately for India, that longstanding PLA favourite, GHQ Rawalpindi, has never succeeded in first separating Kashmir from the Union of India and subsequently doing the same with other bits and pieces of our country. It was D.P. Dhar’s masterstroke—the treaty between the USSR and India—which ensured that China (despite intense prodding by Henry Kissinger) kept out of the 1971 joint operation between the Mukti Bahini and the Indian armed forces to liberate East Bengalis from genocide. Similar insurance against a conflict with China is needed now, this time from Washington rather than Moscow.

Pakistan cannot any more recover its stability as a unitary state. The Pashtun community suffers from an artificial and cruel division formalised by the Durand Line through a treaty that long back passed its date of expiration. A unified Pashtun state comprising of territory on both sides of the now defunct Durand Line needs to be created with Peshawar as the capital, while the rest of Afghanistan could be constituted into a federation with Kabul as the capital. Within Pakistan, GHQ oppression in Sindh, Balochistan and Pashtunistan needs to end, and in order to help ensure this, India needs to help form an international coalition to assist such oppressed nationalities to secure freedom from oppression by the Pakistan army Substantive assistance to the suffering people of Pakistan cannot be accomplished by India acting in isolation. Instead, New Delhi must form part of an international coalition that would unite to oppose the post-colonial colonialism practised within Pakistan and in PoK by GHQ Rawalpindi. Such a coalition must ensure for itself primacy over the waters of the Indo-Pacific, which to this columnist  has always meant the entirety of the Pacific and Indian Oceans. The Quadrilateral Alliance (Tokyo, Delhi, Canberra and Washington) would be the core of a new Indo-Pacific Defence and security alliance. The Quad needs to announce the 21st century Indo-Pacific Charter. This would guarantee security to all democracies in the Indo-Pacific, as also to affiliated powers facing the menace of intervention by hostile forces. It would assure freedom of trade and navigation within the waters of the Indo-Pacific. The signing could take place not in any of the four capitals but in Colombo, the capital of Sri Lanka, a country that needs to be brought into the Indo-Pacific security grid in view of its strategic potential.

Prime Minister Modi needs to prevail over the prevarications of the Lutyens Zone and formalise a Quadrilateral Alliance that does not merely remain a photo-op. Next, the alliance should announce the Indo-Pacific Charter, which in the 21st century will play the same role as the Atlantic Charter did in the 20th. The aim is to protect smaller states as well as keep the two superpowers from going to war against each other. The catastrophic risk of a war between the superpowers was once between Moscow and Washington but now it is between Washington and Beijing. Across the Himalayas, across the Taiwan straits and in the South China Sea are being sown seeds of tension that must not be allowed to grow into conflict that will involve the two current superpowers—China and the US—and two future superpowers, Russia and India. It is obvious that Russia will be on the side of China, thanks in part to the successful sabotage by the Atlanticists of President Donald Trump’s pre-election geopolitical strategy of shifting priorities from the Atlantic to the Indo-Pacific. If it is equally certain that India will be on the US side in such a conflict and vice-versa, a conflict between China and India or war between the US and China can be averted.

Monday 18 May 2020

Globally Influential Website Fuels the Great Lockdown Strategy (The Sunday Guardian)

Backers of the theory have placed great reliance on a website, Registered on 9 March and made public a few days later, much of the detail about its provenance is hidden by WhoisGuard, a Panamanian company.

NEW DELHI: Lockdown has been the recourse of choice of policymakers in key countries across the world. While a few such as Japan went in for only a partial lockdown, the United States went much further, as did France and Germany. Sweden and Belarus were among the few to go ahead with life as usual, of course with some social distancing and monitoring. China was the first to go in for a lockdown, in the city of Wuhan and later the province of Hubei. Rural hamlets were sealed off to prevent city dwellers from entering and infecting them. Altogether, around 180 million in the PRC went through a complete lockdown in that country, a figure that was low enough to ensure a fast bounce-back from the economic pain that lockdowns inevitably impose. Prime Minister Narendra Modi of India was the only world leader to order a complete lockdown on 24 March 2020, that too of a country with a population of 1.29 billion, a lockdown that has largely remained in place from then. This has earned Modi a coveted place in the history books, as well as generous praise from global influencers including Bill Gates, who has from the start of the Covid-19 crisis been an adherent of the Great Lockdown Strategy.
The Covid-19 coronavirus is yet to be comprehensively understood or mapped, including its actual as opposed to the estimated incidence in different countries. Only a comprehensive screening through mass testing would reveal the true spread of the virus and consequently its death rate per hundred of the population. Treatment protocols are being modified or discarded, often with very good results. Earlier emphasis on widespread use of ventilators has been shown to be problematic, as have been initial theories of the exact sequence of causes of Covid-linked deaths. What cannot be refuted is that the worldwide pandemic has resulted in economic distress on a scale difficult to have seen replicated over the past century. This is the inevitable and anticipated consequence of the series of lockdowns of human activity resorted to by successive governments on the urging of the World Health Organisation. WHO failed to discover the pandemic in its initial stages in Hubei province of the PRC, thereby passing up an opportunity to prevent its spread beyond a few locations in China. Later, the entire top echelon of the organisation underplayed its toxicity and denied that it could be spread through human contact, or that travel from affected zones was a serious risk. After such serial misjudgments of the situation, the WHO finally put its prestige behind what is essentially a single-point prescription, which was to confine people in their homes so as to isolate them from human contact. This was seen as the only surefire way of avoiding a disastrous spread of a disease the parameters of which were—and are—still indistinct. While India was unique in both the depth as well as scale of its lockdown, other countries varied in their adherence to the single measure that had the support of prestigious institutions such as the Bill & Melinda Gates Foundation, the Johns Hopkins University and the Imperial College, London, not to mention the prestigious Indian Council of Medical Research.
As data are still coming in on actual (rather than hypothetical) cases and trends, including from the few locations where large-scale testing of populations has been done, to claim with the certainty expressed by US virologist Dr Anthony Fauci about what may be termed “hypothetical facts” seems premature. The effective death rate for the novel coronavirus is still a matter of dispute, with estimates ranging from very low figures secured from a scatter of field tests of significant numbers of clusters of people (such as on a ship, a police or army barrack, or a hospital) to the high mortality rates secured through mathematical modelling. The institutions which publicised such alarming estimates are now claiming that only their lockdown strategy has ensured a much lower death rate. They neglect to comment on locations where such measures were either wholly or partially absent, without the disastrous consequences that had been predicted by enthusiasts of the lockdown strategy. Treatment protocols are being adjusted, including in the use and efficacy of ventilators, and study of the precise path that the novel coronavirus within the body takes to snuff away life. Hospitals in India, the US, Russia and China (the four present and future superpowers) are learning more about what needs to be done to protect patients with severe complications, and hospital deaths are falling as a consequence. Meanwhile, the vaccine industry is in full throttle, given the rewards that would ensue to an early bird in the search for a vaccine that could protect against Covid-19.
WHO needs to give guidance on exactly which medical protocols have been shown to be effective in preventing Covid-related deaths (and such a treatment would limit the tendency to await a vaccine before ending the ongoing pandemic panic), or in estimating the exact number of deaths per thousand cases (rather than rely on estimates generated on a computer screen, which is from where the initial hyperbolic estimates of cases and deaths came from). While recommendations such as hand washing and keeping an individual from breathing directly onto another individual is welcome if not unknown, what is called for from an international organisation linked to the United Nations is a menu of options much more varied than its incessant call for lockdowns to continue into the indefinite future. According to the WHO, there is no telling when the pandemic will end, or if it ever will. There is no telling if those who have been infected but survived have immunity or not. All that is crystal clear to that organisation is that lockdowns should continue into a still uncertain future period, irrespective of the economic and societal effects of such a single-minded course of action.
Backers of the Great Lockdown Strategy have placed much reliance on a website, Registered on 9 March and made public a few days later, much of the detail about its provenance are hidden by WhoisGuard, a Panamanian company. The website is available in German, Spanish, English, Italian, Greek, Russian and Marathi, but not so far in Hindi or in Arabic. Its declared purpose is to “slow the spread of COVID-19 by flattening the curve”. Seven names are mentioned in the “Authors” section. The website exhorts those who access the site to translate its findings into any and all languages, and to disseminate the contents as widely as possible. Modestly, it describes itself as the defining chart of the coronavirus in its ( recital of how and why this signal service to humanity (which no doubt has by now been brought to the attention of the Nobel Peace Prize committee) was born. The newly created website has an impressive list of sponsors, including NIH, INSTEDD and NCHS, all being agencies based in the US with a direct or other connection with the Leonardo da Vinci of the Covid era, Dr Anthony Fauci, although they seem not to have treated it with much financial generosity, as its reported expenses are insignificant despite its enormous media and academe-fuelled worldwide impact.
Although Covid-19 experts swear by the website, and repeat its contents without pause, it seems not to have revealed the studies or sources on which it bases its assumptions. Nor does there seem any academic or data-based background analyses offered by the website to justify its faith in the deadly effect on the pandemic of the doctrine of “Flatten the Curve”. Or whether the “y curve” is cumulative number of cases, cumulative active cases, cumulative daily cases or daily active cases. If any of the hundreds of mediapersons relying on this website have asked for such details, that query seems to have been made in private. Interestingly, in publications and on television channels that incessantly talk of “fact checking” and “science-based conclusions”, the content offered by the website has, in essence, been only the drawing of two curves. The other measures are standard boilerplate in disease prevention and control. The assumptions used behind the shape of the curves over time or revealing the formula behind the two parabolic curves appears to continue to remain a secret from its growing number of incurious but enthusiastic believers. What is apparent from a glance at the metrics shows that several experts in disease control, several with connections to a single and substantial private funding source, began quoting from this miraculous curve almost from the moment it began to appear. They were joined by academics from across the world, all united in reliance on the certainty that a single illustration of two curves was regarded as a great leap forward in unlocking the progress of the novel coronavirus or its slowdown. A search of the media and academic reports on the “Flattening the Curve” gospel reveal them to have been based on mathematical models rather than on empirical data. A comparison of the number of infections and deaths in multiple countries (including India) as opposed to the earliest predictions made by Covid-19 experts shows a huge gap between reality and estimates. Prime Minister Modi has succeeded in keeping death rates far below the levels predicted by such renowned but inaccurate early studies of the spread of Covid-19 in India. This gap between forecast and fact has done little to diminish the credibility of institutions such as the Imperial College and Johns Hopkins and the eager disseminators of the conclusions of their hypothetical models, such as CNN, BBC, NYT and innumerable others in the media who are in favour of the Great Lockdown Policy, presumably until their salaries run out as a consequence of the economic consequences of such a policy course.
Numerous conspiracy theories appear almost by the day about the Covid-19 pandemic. Some claim that there was a competition between the two superpowers to engineer the deadly novel coronavirus and perfect a vaccine for it, so that those given the latter would be safe while infected by the former faced havoc. Clearly a tall tale invented by suspicious minds. Other conspiracy theories give numerous less than flattering postulates about both the lockdown fundamentalists, as well as those who claim that this strategy is a conspiracy of ruling elites to ensure that governments gain a degree of control over their citizens that would otherwise be impossible in a democracy. An illogical premise in any country where politicians have to face the electorate periodically, with tight and continuing state control being very unpopular, especially with the young. Lockdowns across the world may indeed have prevented millions of deaths, and that the substantially lower than anticipated numbers in countries that have enforced either no lockdown (such as Belarus or Sweden) are accidents of micro-biology. It is obvious that livelihoods are impossible without life. Just as it may be possible that the actual and publicity shy designers of a website that from the beginning of its appearance transformed the direction of discourse about Covid-19 onto the Great Lockdown path had the intention of saving the world from a deadly scourge that in their reckoning was far worse in its likely effects than bubonic plague in the 14th century. It must be assumed (even without the assistance of advanced mathematical tools) that the thousands of academics in prestigious institutions. Or that the swarm of mediapersons in international media outlets who unquestioningly rely on the assumptions made by must have substantive and provable grounds for their faith, despite such grounds not being explicitly stated in the website. The serial lockdowns that the world has witnessed since March 23, 2020 cannot surely have been simply a leap of faith. There must have been a science behind such a drastic action by world leaders which will be explained to the lay public in course of time Meanwhile, the several billion individuals anxious about the shrinking world economy will just have to bear the shocks of the Great Lockdown of 2020, looking on with hope and trust on the numerous experts who testify over and over again that the lockdowns they are enduring are the only path towards ridding mankind of a scourge that supporters of the Great Lockdown clearly assume could be a potential killer of hundreds of millions of innocents, unless this multitude be protected from such a calamity through continuing with the lockdowns.

Prof Nalapat on Labour Reforms by Yogi Adityanath and the Way Ahead (PGurus)

A critical look at the repeal of labour laws by the Yogi Adityananth government and the impact of the changes being rolled out as part of the 20L crore package by the Modi government.

Saturday 9 May 2020

Mideast Stability, Security Essential for India (Sunday Guardian)

It is important for India to assist friends in the region and help ensure their safety, stability.
Given that international travel has become a part of everyday life, the distinction between “internal” and “external” threats is surreal. Several of the threats facing the government of a country have their origins elsewhere. An example is the manner in which exiles from Venezuela, Iraq and Libya were harnessed into backing insurgent movements in the three countries, of which the first has yet to succeed, despite the battering that Nicholas Maduro has received from US sanctions. Were the President of Venezuela to have welcomed US oil majors into his country rather than follow the example of his predecessor and strive to build up a domestically run petroleum sector, it is doubtful that any sanctions would have been imposed, no matter what the human rights situation in Venezuela is. Sanctions by the US and by its European allies have caused immense suffering to citizens of several countries, without fulfilling the declared objective of changing the regime in power. Iraq is an example. The sanctions imposed by President Bill Clinton caused immense misery to the population without affecting the lifestyles of Saddam Hussein and those close to him. North Korea has only accelerated the development of nuclear and missile systems with each twist of the sanctions lever by the Trump administration. Given the fate of Saddam Hussein and Muammar Gaddafi, it was pointed out by this columnist in 2011 itself that it was unlikely that Kim Jong Un would surrender his fate to the US and the European Union in the manner both these Middle Eastern strongmen did. The present fate of these two countries (where Whitehall, the Elysee and Foggy Bottom overthrew dictators “in support of democracy and freedom”) show what happens when the morning after gets forgotten while engineering regime change through violence. The consequences of both these military interventions have been less than encouraging where traditional US allies in the Middle East are concerned. Indeed, many are looking towards the emerging alternative to the US-led alliance, which is the Sino-Russian alliance, and which has a record of standing loyally by its friends, in Russia after Putin took charge from Medvedev.

Since the OPEC engineered a sharp rise in oil prices in 1973, US allies within the GCC have gorged on generally rising petroleum prices, which reached a high point of close to $140 a barrel in 2008, just before financial markets in the US tumbled after the decision of US Treasury Secretary Hank Paulson to permit Lehman Brothers to collapse. After the WHO-mandated lockdowns that were put in place across the world, economies have—at least temporarily—crashed. They are experiencing nightmarish levels of unemployment during the past two months,while oil prices breached negative levels for the first time in the history of that commodity. Given the way in which alternative energy sources are developing, the probability is high that within 10-15 years, the demand for oil will fall to levels close to what they are in the ongoing Covid-19 slowdown. Oil prices are unlikely to go back even to $50 a barrel. This being the case, the oil-exporting countries of the Middle East are going to have to make a choice, the first between lavishing funds on extended royal families or allocating more to the rest of the people. Next between businesses and services that can survive a decline in income, and those that will not without constant subsidies. President Donald Trump initially gave promise of standing by those in the Middle East who oppose Wahhabism in favour of the gentle and moderate practices that are natural to the overwhelming majority of Muslims. However, with his abrupt abandoning of the Kurds and his embrace of President Erdogan of Turkey, such a stance seems to have been forgotten. Thus far, the GCC countries have been pillars of stability in a region potentially volatile. In the changed financial circumstances, efforts will be made by radical elements in local populations to create difficulties for the existing governments in several countries, seeking to replace them. As the example of Libya has shown, sometimes the replacement is worse  than the regime that was removed. India has long had a very cordial relationship with the Middle East, links that go back by more than a millennium. During much of the 20th century, India and the Middle East worked in concert, with even currencies being aligned in some cases. Prime Minister Modi and the Royal Families of Saudi Arabia, the UAE, Oman and other countries have developed warm personal ties, a recognition of the importance to India of stability in the region. Should this be challenged, rather than remain on the sidelines, it is important for India to assist this country’s friends in the region and help ensure their safety as well as stability in the countries there.

India’s security does not stop at the boundaries of South Asia, as many assume. It includes the Middle East, where many millions of our citizens live and work, and to which once more those temporarily back will return, once the effects on the global economy of Covid-19 begin to diminish.

PM Modi Faces Vulture Cartels Seeking Gains from India Inc Crash (Sunday Guardian)

Banks, airlines, companies, resources are being examined for possible distress takeover in case of an economic crash-landing.
 New Delhi: Vultures dealing with business and finance that are based in foreign locations are looking at India with anticipation. They are hoping to pick up assets that the policies they advocate—if accepted by the government—will bring down to disastrously low levels. Banks, airlines, public entities, resources—all these and more are being examined for possible distress takeover should an economic crash landing take place, in a situation where dollars, euros, sterling and other such “hard” currencies are gaining steadily against the Indian rupee. For some time now, there has not been any expectation of the value of the rupee going up, the overwhelming forecast being that it will fall even further from its present historical low against key currencies. Meanwhile, the accomplices of these interests both within and outside the country are incessantly warning in public and in private against taking the fiscal and monetary measures needed to ensure a revival of the economy. A crash would result in the feasting on the knocked down values of Indian entities by external investment funds intent on squeezing out billions of dollars of profits from human misery. Their only fear is that Prime Minister Narendra Modi may overrule the toxic (aka conservative) advice that is coming from a section of the policymaking community quarters to be parsimonious on the overall stimulus package, “to prevent the rating agencies from downgrading India to junk status”. This when further delay in fiscal and monetary packages of the level and direction needed for not just recovery but the very survival of key segments of the economy is already resulting in vast swathes of activity being converted into wastelands that will soon become progressively more difficult to nurse back to health, even with a correct level of stimulus targeted at protecting jobs and ensuring working capital so as to ensure that businesses resume in accordance with the permissions given.
Investigative agencies would do well to track the nature of the multitude of contacts of personnel employed by those reliable Wall Street boosters, the “international rating agencies”. Personnel within those entities have extensive contacts with the very officials in India who frame the fiscal and monetary policies which determine the level of their profits. They therefore come into possession of inside information that professional ethics demands of those giving them not be shared or used, but routinely are. Such agencies are in favour of assets in India becoming cheaper and cheaper in dollar terms with every passing month, thereby making takeovers more attractive in an economy that they know no force can keep down permanently. Those eager to ensure a fiscal and monetary stimulus sufficient to rescue the Indian economy from a Covid-19 economic meltdown say that some rating agencies are lobbying to ensure that any such effective (as distinct from token) stimulus gets blocked, so that their own interests get fulfilled. Their purpose has always been to serve the interests of their overseas clients (and those Indian clients who usually through their proxies hold vast reserves of cash abroad) at the expense of the 1.29 billion people of India. Rather than rescue the economy through fiscal and monetary stimuli of sufficient amount, such entities are goading their contacts within the governance mechanism to instead recommend the selloff of state-owned assets cheaply, in fact very cheaply. Recently, a particular cartel (that had been inseparable from UPA policymakers in the past) has fixed its gaze on Axis Bank and on the equity held by state entities in private sector blue chip companies such as ITC, which they are eager to snap up at steep discounts. According to an individual familiar with the goings-on in the “PC Network” (the most active and effective cartel of such operators), they are, among other planned low-cost acquisitions, seeking to get control of Yes Bank for less than Rs 25, 000 crore, when the actual value is nearly four times more. Instances of such feeding by vultures on state-owned assets are many. It is as though North Block, since the 2014 changeover, has seemed almost a continuation of UPA 1.0 and UPA 2.0. This is despite Finance being the Ministry particularly critical to growth. Only with the arrival of Modi 2.0 on the wings of the Balakot strike and the absence of a credible alternative is the situation changing.
An example of a matter that calls for probing in a manner free of the influence of the PC Network are the goings on at MCX. This is the largest exchange for commodities trading, the way the NSE is the largest for stock trading. According to a source familiar with the situation, while some brokers operate only in the commodity exchange, a group operates in both. The exchange allows brokers to trade on commodity futures, with settlement being made in cash at the close of the trading period. Such a practice may be contrasted with several other commodity exchanges, where settlement takes place on delivery. Any shortfall or margin therefore gets offset by the exchange’s settlement fund if the broker goes broke. Otherwise each broker is expected to make up the margin shortfall on a continuous basis. Why SEBI has not looked closely into such practices while dealing with the situation in India is among questions needing to be answered, but which thus far do not seem to have even been raised. Simultaneously, taking an entirely different position in Dubai, HK or Singapore than was done in Mumbai may make possible the keeping of profits on such overseas trade in offshore accounts. Where the money for such trades comes from, and who the possible fronts or sources of those making them, needs to be in the list of questions asked by the relevant authorities in this country. Estimates vary of the potential gains made abroad by such brokers, but some put the amount in just this set of trades at well over Rs 50, 000 crore. It is possible that the brokers sought to be enquired into for such trading in multiple locations are innocent of wrongdoing, but finding that out requires an enquiry, which thus far does not seem to have taken place. Besides of course zeroing in on a few obvious (and peripheral) matters involving far smaller sums of money. The good news is that Modi 2.0 has ensured better coordination between the Ministry of Finance and the PMO in accordance with the Prime Minister’s Zero Tolerance policy towards illegal harvesting of moneys abroad or in India. Finance Minister Nirmala Sitharaman will need to prod agencies such as SEBI and the ED to be much more active in the matter of multiple trading, so that accountability gets fixed. Given that financial data cannot be eliminated thanks to electronic records and their retrieval, it is only a matter of time before guilt or innocence gets proved in the matter relating to some high profile brokerage entities. Of course, whether it be co-location or other matters, thus far only cosmetic enquiries appear to have been made, for whatever reason.
A cursory forensic audit would suffice to reveal how public institutions have lent moneys repeatedly to entities that have neither the intention nor the ability to repay even the loan capital, much less the interest. Several such mega loan mela recipients have not been able to repay even part of the capital borrowed for months. They are unlikely to lose sleep over this. Loan after loan has either been wholly written off or disposed of at a massive haircut that is of course suffered by the public institutions who made the advances, usually on the verbal instructions of VVIPs. That an agency such as SEBI has the ability to generate moneys from targeted businesses was clear in the Sahara matter, where substantial sums amounting to Rs 25, 000 crore were swiftly recovered despite the promoter being in jail. However, such activity by SEBI has been the exception, even while suspicious dealing by select brokerage and corporate entities reached unprecedented levels, many during the UPA period.
Why SEBI and RBI during the tenure of successive SEBI Chairmen and RBI Governors have been so lenient and forgiving to so many who are under suspicion of having siphoned off substantial sums abroad through frauds committed in India has been a puzzle to students of the markets in India, something that electronic evidence could with ease resolve in Modi 2.0. Given existing regulations and the manner in which they are enforced, even those who have looted as much as (and sometimes more than) Rs 50, 000 crore (first by securing loans from public entities and thereafter shifting funds through various routes from the corporates they milk) at worst may face a few months in prison in Arthur Road or Tihar before getting out on bail, in many instances permanently. As for civil suits against such depredators by those they have cheated, such proceedings may finally get decided after their grandchildren become grandfathers.
The Indian economy needs a carefully directed fiscal and monetary stimulus amounting to an additional expenditure 5% of GDP each year for the three years that the effects of the Covid-19 pandemic and the countermeasures taken by government wear off. The financial history of countries across the world is littered with accounts of the pain and collapse of multiple economies whose Finance Ministers adopted the playbook of the international rating agencies. Milton Friedman (whose favourite saying, “there is no free lunch”, indicated that he had yet to meet a journalist or a politician) founded the Chicago School of economic theory, which believes in the maxim that suffering by the poor is good for their souls. This is the same credo adopted over the decades by vulture finance and its accomplices. In India, many of those at the higher levels of framing monetary and fiscal policy (for a country with immense potential waiting to be utilised) consider the firmans of Wall Street-oriented foreign agencies as gospel. This despite the obvious bias these have almost invariably shown against India, an economy where the debt to GDP ratio stands at a healthy 62%, and which debt can be tripled without coming close to the level of Japan, whose debt to GDP ratio is 245%. Or doubled like the US, where at last count this had breached 110% and is expected to climb much more this year itself. Despite its much lower level of debt relative to GDP and its always having met its obligations so far as external loans are concerned, Moody’s has given India a Baaa2 rating, which is just below junk status. In other words, Moody’s has relegated almost to junk status the financial paper of a country that is already the third biggest economy in the world in Purchasing Power Parity terms. As for the US, whose financial problems Moody’s and other agencies constantly gloss over, the same agency gives a rating of Aaa, while heavily in debt Japan has an even higher rating, Aa3. Standard & Poors rates India a lowly BBB, as does Fitch, while for the much more in debt US and Japan, their ratings are AA+ and AA- respectively. The Chinese have tossed such ratings out of the window, and India should do likewise. And, like the Chinese began doing in the 1980s, focusing on formulating and implementing strategies for high growth, including from domestic and external investment. The first requirement of such growth is the bringing back to health of the economy through booster shots of monetary and fiscal measures designed with an eye on domestic interests rather than a the type of vulture financial entities that were among the primary reasons why the 2008 crash (not to mention that of 1929) took place.
That rating agencies loyal to Wall Street and to global offshore banking hubs awash with illegal cash are less than reliable is acknowledged worldwide. Beijing refuses to take them seriously, which is why their ratings have had no effect on the performance of the Chinese economy. Even countries favoured by them such as the US and Japan have complained about these agencies, the latter for example in 2002, when a downgrade was given that had the effect of handicapping Japan against a particular country that the agencies seemed to favour at the time. It may be remembered that Lehman Brothers, whose downfall triggered the 2008 global financial crisis, was given a rating of AAA even on its sub-prime loans to the very end. Thus far, there does not seem to have been a serious enquiry into the obvious fact that the US sub-prime bubble had reached skyscraper proportions over many years under the approving gaze of the rating agencies. Earlier, S&P had given not junk but investment grade rating to both Worldcom and Enron when they went bust. It may be remembered that Italian police raided the house of a key rating agency executive for “spreading false information designed to manipulate the Italian financial system”. Such manipulations appear to be routine in India, with the perpetrators going undisturbed by those specifically tasked with protecting the economy from harm. What has taken place in some Indian banks, brokerages and exchanges as a consequence of the operations of the PC Network have been documented several times in the records of agencies and much is even in the public domain. Such activity is continuing in the present, including the often successful efforts of the network to protect favoured individuals and institutions from being held to account for financial crimes. And indeed, to ensure in the past that many got placed in high positions. Foxes are given the responsibility of guarding the poultry farm. No less a personage than Economic Advisor to President Barack Obama, Austan Goolsbee had choice words to say about a rating agency (S&P) that is treated reverentially by Mint Road and in North Block, who seem unable to understand the severe cost to the economy and to the public interest involved in following the copybook of those for whom mass misery is a bagatelle and profits to their hyper-rich clients is the only goal. At present, some agencies seem intent through dark forecasts of driving down the equity values of some banks and financial institutions, so that the same may get picked up cheaply by offshore vultures later. The recommendations and actions of Wall Street and offshore banking-oriented rating agencies favour the needs of a small segment of the financial markets rather than the interests of the population as a whole, the latter being the very interests that politicians have been voted to power to safeguard.
India has never defaulted on its public debt obligations, yet this fact has been ignored by rating agencies working ceaselessly to constrain the Government of India and the Reserve Bank of India from spending anything close to the moneys needed to protect the economy from the 2020 Covid-19 shock. Indeed, the very term “default” is subject to multiple interpretations. Moody’s calculates on the (subjective) basis of “expected loss” and “ability to pay”. The data path by which its analysts reach such conclusions is of course changeable and usually opaque. Fitch talks of “default probability” along with “willingness to pay”, yet fails to explain why India with its perfect record on both counts is given such a miserably low rating. Such ratings, thanks to the outsize influence of such agencies, handicap domestic companies to the benefit of foreign competitors, an outcome that seems far from coincidental. Fitch relies on an aggregation of these two factors. It is obvious that the terms used are elastic and subject to interpretation on an industrial scale, which is why these agencies have escaped censure despite their record of bloomers. Rating agencies profess to rely on quantitative data, when the reality is that a heavy overlay of qualitative (i.e. subjective) deductions gets amalgamated with data analysis. The process of mixing of the subjective with the objective is hidden from public view, with only the briefest of reasons being given in public for an upgrade or a downgrade. Investors have been trained to swallow the prescriptions of these agencies without question, although recently contrarians have become more frequent.
Moody’s calculates economic, institutional and fiscal strength, helpfully adding “susceptibility to event” risk. What these are or how they are calculated seems to vary with the seasons. S&P employs the grandly proclaimed RAMP (Rating Analysis Methodology Profile) method, which is as vague as it sounds. This comprises of a 5-point score that again seems at bottom intensely subjective and prone to reaching wrong conclusions. Examples of criteria are “Institution and governance effectiveness” or “Economic structure and growth prospects”. Given the serial errors in such forecasting, the method used is probably astrology. Scores are calculated by use of data that is simply not there or not accurate and timely in many cases, and this is the “objective” part. In the case of the Indian economy, the ridiculously named and impugned “informal” sector (which creates more than three-fourths of jobs outside farming) has consistently been given a negative rather than the positive score the sector deserves for its invaluable contribution to overall economic wellbeing. It may be borne in mind that the UK and the US have on several occasions sent Wall Street’s associated personnel to jail or levied billion dollar fines on them, but not India. The few fines or punishments levied by regulators in India are derisory in comparison with the misdeeds committed, an example being the co-location scandal at a prominent exchange that has been and remains a favourite port of call for Finance Ministers of the Union of India. Another is the ongoing effort to disguise the monumental snafu perpetrated in oil futures by passing it off as a matter involving less than Rs 400 crore, when in fact the actual cost of the full transactions is several times higher. How much have Indian public institutions lost as a consequence of such activity? If India were the US or the UK, the PC Network would have been disbanded years ago, with billion dollar fines and stiff prison sentences for a few of its key players, rather than having many of its known elements ensconced in key policy slots. While some point to the remarkable coincidence that several scions of influential political and official personages have found employment in Wall Street and its satellite agencies, it would be an expedition into hypothetical scenarios to claim that governance decisions are being taken in accordance with the wishes of such foreign agencies only because of such family ties. Awe and reflexive acceptance of the presumed wisdom of the international rating agencies is a syndrome common within the portals of Mint Road and North Block, despite the consistent failure of such agencies to warn against global crises or their visible bias against India. The only task they fulfil efficiently is to favour short sellers, including those who bet repeatedly against the rupee.
India must weaponise the Quad and move robustly into the US-led military alliance rather than see-saw between that grouping and the Sino-Russian military alliance. Such a move would have an immediate effect on perceptions of India in a manner that even rating agencies would need to recognise positively. Lower tax rates and less minatory regulatory systems need to be implemented at speed. Lower rates, including in GST, mean higher growth and therefore more collections. Prime Minister Narendra Modi has immense goodwill across the country and retains the trust of the people. This opens the path for the success of innovative schemes for monetising this country’s immense gold reserves in an entirely non-coercive way. This would include the tax authorities forgiving past sins, many of which caused by regulations that are designed to stifle growth and boost bribes. Such changes would generate a push for growth, as would slashing taxes and therefore prices on feedstock such as petroleum. If this be done, it would help ensure that inflation levels do not rise even if the estimated amount of necessary stimulus (5% of GDP as extra spending each year over three years) gets pumped into the hands of workers and farmers, as well as in meeting the working capital needs of those employers suffering from the effects of measures taken to protect the population against Covid-19. Unlike what the Chicago School preaches, the Indian economy needs an effective level of stimulus precisely because so many within the population are poor and vulnerable. This is especially the case with the small, medium and “unorganised” sector (although this term is a misnomer, as is “informal”). Tax rates need to incentivise employment, rather than focus only on the replacement of men with (usually imported) machines.
Infra programs such as highways need to get completed not by relying on high-cost machinery but on labour. Given honest implementation, quality will be as high or higher should many people rather than a few machines be put to work. It is clear from the improvements made since 2019 that the control lever in North Block has now firmly shifted into the hands of Narendra Damodardas Modi. The PM will be aware that by August 15, 2020 the country needs to experience the cool breeze of hope sparked by a reviving economy rather than chill winds of despair caused by economic storms. Fiscal and monetary policy should not be dictated by international rating agencies, but by ground realities focusing on the need for high growth and employment. India has immense reserves of strength. Those seeking to block the utilisation of those strengths so that billionaires make even more money at the expense of the middle class and the poor need to be regarded with the disdain they deserve. Nothing succeeds like success, and once an effective stimulus package places the economy on the track towards ensuring a generation of double digit growth in the manner Deng Xiaoping did for China in the 1980s or Zhu Rongji in the 1990s, the same rating agencies now lobbying for a measly and disastrous fiscal and monetary response to the existential crisis caused by Covid-19 in the economy will come flocking back. They would be full of praise for effective policies, forgetting their own past advice, as they hunt for renewed relevance. What India needs is a sufficient and well-directed stimulus package which gets implemented under the direction of PM Modi.