Saturday 26 September 2020

Biden’s lack of boldness emboldens Trump ( Sunday Guardian)



Biden seems to lack the intensity of Trump, and is giving an appearance of being micro-managed by smug and know-it-all staffers.

President Donald J. Trump refers to his opponent as “Sleepy Joe”, while others in his entourage use another epithet to describe the Democratic challenger, “wimp”. They say that the only time Joe Biden showed genuine emotion was when he reacted to Trump mocking soldiers in wartime as “losers and suckers”. From all accounts, Biden’s son and former soldier Beau was an outstanding human being, and not just his family but his country has been diminished by his loss. The former Vice-President is himself known to be a person of faith who has preserved family values and his own integrity, together with wife Jill, who is known for her steadfastness. Both are unlike younger son Hunter, who seems fixated on making money, no matter where or how. This has made Hunter the second-weakest link in the chain of events that could catapult the Bidens into the White House on 20 January 2021. The weakest link is Joe Biden’s staff, several of whom are not even Barack Obama vintage, but are unrepentant Clinton groupies. They are uncomfortable with (and uncomprehending of) the immense changes that have taken place in the world and in the US in particular since the 1990s. While there are a few outstanding talents within the Biden campaign, many of the key staffers are of the same vintage and mindset as lost the 2016 election for Hillary Clinton, by misinterpreting the mind of the very voters needed for victory. The same excess of confidence seen in Team Clinton during the 2016 campaign has been present in Team Biden, the latter sharing the earlier belief of the former that it was “impossible to lose” against a candidate as riddled with contradictions as Donald J. Trump.

While the 45th President of the US has his flaws, and multiple books have been pointing this out coincidentally close to election night, he cannot be accused of being anything other than his own man. The volley of barbs directed by President Trump at China during this year’s UNGA speech went against the obsession of diplomats everywhere to substitute plain speaking with opaque language capable of multiple interpretations. Donald Trump likes those who are “less educated”, and what he said about China in that very consequential UNGA speech would have been understood even by a 12-year old. Several in the inner recesses of power in Beijing fondly remember Vice-President Biden (as well as Hunter), and expect that the US will go back to the Clinton-Obama era where the PRC is concerned. This was a time of occasional symbolic gestures designed for television audiences camouflaging a welter of concessions. It was President Clinton who opened the doors wide to the WTO as well as to technology imports from the US to China, even while keeping the door barred to India. In contrast, Joe Biden seems to lack the intensity of Donald Trump, and is giving an appearance of being micro-managed by smug and know-it-all staffers in the way Hillary Clinton allowed herself to be. On China, Biden has stuck to the State Department handbook, which is to talk in language that is subject to different meanings and which conceals the intent, if any, of the speaker. If Trump can succeed in making the 3 November contest a referendum on who can best take on China, he would win, as Joe Biden in his hyper-scripted establishment avatar seems diffident about facing the challenge to US global primacy that China under Xi Jinping represents. Astonishingly, 17 Congresspersons from the Democratic Party in the House of Representatives (including the youthful hope of the Kennedy family, who shamed the memory of John F. Kennedy by this action) demanded that “arms sales to India stop”. The beneficiaries of such a move would be Pakistan and China, clearly countries closer to the hearts and minds (if not the pocketbooks) of these members of the House of Representatives than the world’s most populous democracy. Or the need to defend it against a Wahhabi military that breeds terror organisations and an authoritarian expansionist state intent on driving the US out of the Indo-Pacific and from the pinnacle of world leadership. Neither Joe Biden nor Kamala Harris has reacted to an initiative designed to advantage China and Pakistan over India. Not to mention benefit the military sales entities of Russia, who would step in to fill the vacuum left by the US blocking weapons sales to India. Biden campaign managers seem to have muzzled even Kamala Harris—for the few events in which she is allowed to participate are lacklustre—with poor choice of background together with boilerplate introductory speeches. It is a surprise that Joe Biden does not show some boldness in using his Vice-Presidential pick’s charisma and speaking skills. Both Harris and her partner Doug Emhoff are attractive campaigners with an appeal far beyond considerations of ethnicity, but neither seems to be in favour with Biden’s handlers, hence the sparing way in which they are being used in the 2020 campaign. Much of this consists of scripted meetings addressed by Biden with the help of a teleprompter, thereby forcing voters to contrast diffident delivery with the easy confidence of President Trump. An election is the compound of intellect and emotion, and in the latter department, thus far the Biden campaign is much lower down the scale than events involving Donald Trump and the formidable Mike Pence.

Voters in the US are looking for the candidate who can face down the Xi-Putin combo. Trump is vulnerable in view of his softness towards Vladimir Putin, but Biden is less than convincing in attempting to show that he can take on Moscow, while where Beijing is concerned, all that is visible from the Democratic standard bearer are either platitudes or silence. Such reticence could act as fodder for the expected Republican volley against Hunter Biden next month. Joe Biden would have done well to support some of Trump’s initiatives against China rather than reflexively oppose whatever the 45th President has been doing. Given the trouble that geopolitical shifts mixed with Covid-19 is causing, only a bolder Biden can win the contest for the White House, not a candidate constrained by his staff, many of whom are operating in the belief that the 1990s can return. Of course, several in the Trump train believe and act as though the 1950s can return, and hence the 2020 race for the White House is developing into a battle between two different revivalist visions. The more Joe Biden goes by the dictates of some of his key minders rather than listen to his own conscience and hark to the example set by Beau, the closer Donald Trump is to securing a second term in the White House.

Stock market mayhem key weapon of anti-Modi alliance ( Sunday Guardian)



A key calculation of the global alliance of groups that have coalesced to oppose Prime Minister Narendra Modi is that the decline in economic performance caused by Covid-19 and other factors will result in a steady intensification of public discontent.

New Delhi: A collapse in commerce, reversal at the hands of China and continued corona havoc are regarded as the keys that would bring down the popularity of Prime Minister Narendra Modi and by implication, the credibility of a government headed by him. While millions of Covid-19 cases may have been avoided as a consequence of the Great Indian Lockdown ordered by Modi on 24 March, the phobia about the novel coronavirus caused by doomsday warnings about its effects is continuing to affect business sentiment and economic prospects in India, a situation expected to continue into 2021. About China, the assessment of those eager to see a weakened Modi is that Beijing will continue to nibble away at territory in a manner that would affect the confidence of the public in his ability to protect the borders of India. A key calculation of the global alliance of groups that have coalesced to oppose Prime Minister Narendra Modi is that the decline in economic performance caused by Covid-19 and other factors will result in a steady intensification of public discontent. The assessment is that by the close of 2020, such a change in mood and public support would ensure the beginnings of a repeat of 2012, when Baba Ramdev became the face of a mass movement against UPA 2.0. This was before then Gujarat Chief Minister Narendra Modi took hold of the public imagination as a possible saviour against governmental corruption and sluggish income growth. It is unclear who the face of the planned movement against the Modi government is expected to be this time around, except that it will not be Rahul Gandhi. Having bossed over the Manmohan Singh government as Heir Apparent of the Congress Party throughout the UPA decade, it would have taken the skills of a Houdini for Rahul Gandhi as inheritor of the UPA legacy to escape the charge of corruption that he flings with alacrity against Modi. The results of the 2019 Lok Sabha elections were decided from the moment Rahul Gandhi embraced the suggestion made by seniors within his party that he be the party’s 2019 candidate for the Prime Ministership of India. The decision by him to enter the PM sweepstakes converted the 2019 electoral contest into a choice between Rahul Gandhi and Narendra Modi as PM. The consequence was that the BJP tally crossed 300 Lok Sabha seats in that poll, while the Congress Party strength in the Lok Sabha fell in an unprecedented manner. There must be glee within the NDA that neither Sonia Gandhi nor her designated successor Rahul seems to be in any hurry to surrender control of the Congress Party to any of the capable non-family individuals present in an organisation that still has support within elements of the public. Such backing is based on sentiment rather than on more tangible factors, but sentiment and emotion have long been drivers of political choices in India.

Although this has yet to happen, there is anxiety in Beijing as well as among those opposed to Modi that he may soon take advantage of the geopolitical opportunities created by the anti-China mood in the wake of Wuhan being the epicentre of the pandemic. The government has the strength to hold a Special Session of Parliament to put through measures designed to push through fiscal and monetary policy that frees itself of the Milton Friedman nostrums that are designed to keep the poor in poverty, squeeze the middle class and reduce its numbers while at the same time leaving the wealthy unscathed.


A start at substantive structural reforms has been made during Modi 2.0 in Education and Agriculture, although in both fields additional fine tuning is needed of the reforms undertaken. The government’s policy options have to be secured from a much larger pool of talent than the limited group comprising the higher bureaucracy and their long-term contacts. Innovations which include substantial horizontal recruitment and the resulting embedding of domain specialists need to be introduced. Corrupt officials have to be identified continuously and removed from responsibility rather than continue to do their dirty work undisturbed. Several within the IAS, IFS, IRS, IPS and other services entered through the ancient Chinese system of a single set of examinations are motivated by a genuine desire to work for a better country, and such reforms would be welcomed by the honest majority of officials. Indeed, several officials have even before retirement migrated from the administrative services to the private sector, and are doing very well there. Only a minority within the administrative services have succumbed to the lure of lucre and thereby betrayed the trust of the people, but the harm done by such corrupt officials is often much more than the good done by officials who belong to the honest majority within the administrative services. This is especially the case when the political interface becomes a force multiplier for corruption and its effects, as has been repeatedly witnessed in India to the detriment of the country. Corrupt officials form a network that protects each other, so that accountability for past misdeeds has almost entirely been eliminated from a system that prides itself on being inbred and resistant to outside ideas and influence. In particular, any suggestion which reduces the grip of the administration from the colonial-era levels it still enjoys is thrown away without a second look. Central officials with a vested interest in retaining discretionary powers well beyond what is desirable in the interests of public policy seek to constantly expand such powers at the national level, while their like-minded colleagues work for the same expansion of discretion at the state level. Every crisis is used by them for the purpose, including the reverberations to public policy caused by the novel coronavirus. Since the 1950s, policymakers in India have been talking of decentralised Panchayati Raj, without taking the steps needed to devolve sufficient finances and authority down the line of administrative jurisdiction. These are matters requiring urgent attention during Modi 2.0, and the worry of those opposed to Narendra Modi is that he will finally ensure such changes, hence the intensifying effort to destroy his goodwill and credibility especially within the middle class. This group is the link between the poor and the wealthy, and forms the keystone of the economic arch. By word of mouth and by other means, capsules of misinformation are being disseminated about Prime Minister Modi that have been expertly compiled to discredit him in the eyes of those who have long supported him. The strength of the NDA government that has been in power since 2014 is that PM Modi is seen by millions as the protector of India from chaos and the PM who can rescue India from the misery of low growth rates. Unfortunately, thus far standard police methods have been used against the tactics used by predators, such as the filing of multiple FIRs and other methods relying on state power. Most such actions become an exercise in futility. An example is the manner in which Vijay Mallya is still living in comfort in the UK after officials in India turned down his public offer to repay the principal and interest he owes to the public banking system. Nirav Modi and his high-priced lawyers are still smiling even as the exchequer bleeds as a consequence of the manner in which banks have been drained of funds by him and by others too numerous to mention. The list of those who have clandestinely secured a passport of convenience as a prelude to escape overseas is growing. What is needed urgently is a transformational change in the matrix of policy that is designed to enhance the capability of the economy to begin growing at an annual minimum of 9%. This floor rate is needed to enable social stability to be maintained so as to create the conditions for double digit growth rates spread over a generation. If Beijing could do it, why not Delhi?


An institution affecting tens of millions of the middle class that is vulnerable to attack by the anti-Modi coalition is the stock market. It is here that “termites” have been at work undisturbed by multiple regulatory agencies. Even before Covid-19 was released upon the world in January 2020 by the WHO failing to warn countries in time to block visitors from Hubei, there has been a succession of what agencies have identified as market manipulations that have in their reckoning caused immense financial harm to investors. Entities needing forensic examination for their practices are listed by honest officials in monitoring and regulatory agencies as including BMA Wealth Advisors, Karvy Stockbroking, India Nivesh Securities, Allied Financial Services, V Rise Securities, Anugrah Stockbroking and Modex Securities. Such entities may deny that anything other than “routine errors” have been made and that not wilful actions but “market changes” were the culprit in the destruction of investor value. What is impossible to deny are losses amounting to thousands of crores of rupees suffered by Indian investors through their trust in entities indulging in questionable activity in plain sight of somnolent (and seemingly complicit) regulators. The losses made as a consequence of market mischief get distributed amongst hundreds of thousands of investors, who almost always lack the unity and political and financial reach and resources necessary to secure justice through a legal system not always known for speed in decisions. As a consequence, the perpetrators of such frauds have thus far mostly escaped not merely penalties or prosecution, but even detection. Their cabals enjoy official as well as political protection. While some brokerage entities have been directly involved in actions that have reduced hundreds of thousands of investors to penury, greater effort needs to be made by North Block to bring to account the entities responsible for the cheating of investors. These cabals include the “PC Network”, who lead in their predatory behaviour. These also include certain stock exchanges, depositories, clearing corporations and professional clearing members. Ending the somnolence of regulators and monitors such as the Economic Offences Wing in different states and SEBI needs urgent attention by Prime Minister Narendra Modi and Finance Minister Nirmala Sitharaman. International investor confidence in stock markets in India is in danger of ebbing away as a consequence of market manipulators functioning with the help of accomplices in levels of authority. Confidence in the integrity of markets is essential if genuine investors rather than vulture funds and arbitrageurs with insider accomplices are to be motivated to invest substantially in the Indian market. SEBI seems clueless about what is taking place, and as for the EOWs, the less said the better. Police Constable (PC) methods can never succeed in thwarting the sophisticated frauds and manipulations that are taking place almost with impunity in certain exchanges in India. All they do is create an illusion of accountability that television anchors can declaim over until public attention moves on to another subject and the inactivity of the agencies gets ignored in the thrill of a fresh diet of “breaking news”.


A few brokerage houses can bring about a shock to the economic system as would severely retard its prospects. Among the ways in which this can be done (and gets done) include:

(a) transfer of client securities without authority (from the client);

(b) trading without authority (from the client);

(c) diversion of client funds and securities for covering losses incurred in trading by brokers. This common and fraudulent practice results in Ponzi schemes that eventually go bust at huge cost to innocent investors who operate on the basis that regulatory and monitoring agencies are watchful rather than sleeping at the wheel;

(d) utilisation of client funds and securities for proprietary trading by broker;

(e) diversion of client funds for other business such as real estate or lending to cronies.

While SEBI sleeps and the EOWs chase after diversions, such misuse of the market mechanism takes place daily in a country where even something as major as the co-location imbroglio has been swept under the carpet as the matter involves an exchange that has long been favoured by elements in North Block. Litigation does get resorted to by those who have been affected by such frauds. However, such processes take years if not decades to conclude, and are therefore hardly a disincentive. As for the police, their lack of knowledge of the market gets added to the propensity of corrupt elements to look the other way. This is once “goodwill” gets distributed to corrupt officers and officials by brokers who gladly hand over a small share of the moneys they have made at the expense of the investor. Small wonder that even efforts at accountability result in cases that drag on for years with no result and which are initiated by charge sheets that are so riddled with inconsistencies and inaccuracies that they get dismissed in court. It was during the UPA period that such issues multiplied, with Union Finance Minister P. Chidambaram not hiding his partiality towards certain exchanges. This combined with an open display of hostility to the business rivals of favoured entities. Thus far, Chidambaram has been held to account only for pocket change rather than the substantial amounts of money that flow from stock market manipulations. The PC Network is making sure that the light shines on only a small patch. This is in order to avoid a situation where the culpability in frauds and sabotage of competing entities of those still in high positions gets exposed.

The PC network ensures that its members be protected from discovery or penalties in case any gets discovered, usually by accident. The widespread dissemination of the PC Network within the financial bureaucracy (including some regulatory agencies) has led to a sense of invincibility amongst stockbrokers favoured by the network. These get used in financial transactions which are not always ethical or even lawful, of course with a blind eye turned towards them by somnolent regulators. Such brokers are confident that the exchange & clearing corporation (which would have to bail them out in case of defaults) has a near perfect record of not discovering frauds until the last paisa has been squeezed out of the unwary investor and diverted to the clearing corporation. The record will show that this has happened in a miscellany of cases, many involving a particular exchange that inspected such trades only after the clearing corporation had received and used the money that investors were persuaded to hand over in good faith. The process ends with the clearing corporation walking away with the money and securities of investors who run after a broker only to discover that he has closed shop. The specific exchange that members of the PC Network normally utilise will then declare the broker to be a defaulter, so that no further arbitration is possible under the by-laws. The exchange and clearing corporation gobbles up the fruits of the stolen property of the investor. The existence of such trades, which were given a boost during the Manmohan Singh years, is among the reasons why genuine investors are wary of Indian markets, even the few unaffected by practices which would ensure hefty fines and possible jail time in the US but which escape with either no or negligible penalties in India. This needs to change during Modi 2.0.


PM Modi can protect investors by passing a law that would make the clearing corporation repay funds to defrauded investors without the latter having to go through the judicial mechanism. An amendment needs to be incorporated into the SCRA which provides that in cases where client funds and securities have been used to settle another client or broker trades, the settlement will be void. The clearing corporation being the central counter party should be obliged to return the funds or securities to the affected clients. This is possible as the properties lost through fraud vest with the clearing corporation, which is the central counter party. Of course, exchanges and the clearing corporation will resist such a move in favour of innocent investors. Once Prime Minister Modi goes ahead with a necessary reform of the stock market, the effect will be to force the exchanges to take up inspections properly rather than simply for show. It will act as a disincentive to exchanges to turn a Nelson’s eye to frauds being committed by unscrupulous brokers and clearing members who are giving exchanges in India a bad name by retaining the practices they perfected during the UPA era. Of course, the clearing corporation would be entitled to recover its dues through the processes of law. What is needed is to avoid the protracted litigation that has become a commonplace, with cases lingering on while defrauded investors suffer helplessly. Many simply give up, as they lack the money needed to hire the expensive lawyers needed for challenging the pricey advocates hired by the other side. Stock market scams wiped out the urban Lok Sabha seats held by the Congress regime under Narasimha Rao and the same happened to the BJP government headed by A.B. Vajpayee. The effort is to ensure a similar situation of political fallout in India, once again involving an unscrupulous section of brokers together with lax oversight by regulators. The present laws, regulations and administrative practices have not kept pace with the way markets have evolved and the newer ways of cheating the investor. This is the reason why cleansing and making transparent the functioning of stock exchanges and ancillary trades should be given high priority during Modi 2.0. Among the steps that could be taken is to avoid cartels and monopolies by permitting investors to access the market in ways more freely than at present. Trust the citizen while keeping an eye out for the very few who betray that confidence in the integrity of citizens of the world’s most populous democracy. Change is needed in a situation where fraud has become rampant and punishment of the perpetrator almost non-existent. Every investor cheated of his or her money is a family ruined, something that should be eliminated through discovery and punishment of offenders in a manner that is the opposite of the past.

Saturday 19 September 2020

Xi Jinping gambles on Mission Meltdown in U.S. and India (Sunday Guardian)

Xi Jinping is aiming at China taking on the mantle of the world’s pre-eminent power, displacing the United States, before he completes a third five-year term.

New Delhi: Xi Jinping comes from a privileged family that has seen both rough as well as good times. Unlike the assertive and brash children of some of the Chinese Communist Party leaders lower down the leadership ladder, Xi’s daughter Mingxe is quiet and courteous, refusing to partake 24/7 of the pomp and privilege of her father’s high office, while his wife Peng Liyuan is herself a well-known singer of motivational and patriotic songs, which are usually sung by her in a military setting. From his early years close to high authority, such as his affinity with China’s longest serving Defence Minister, Lin Biao, the current General Secretary of the CCP has placed the military at the centre of his statecraft. This distinguishes him from Deng Xiaoping and Jiang Zemin, who put commerce above everything else, or Hu Jintao, who placed a high value (and spent lavishly) on securing goodwill across the world. Soft power was given priority by Hu, even as he took steps to increase the domestic component of hi-tech fields of endeavour, a task enthusiastically embraced by his successor, Xi. Since 2012, “soft power booster budgets” have been cut and those cadres engaged in “goodwill” missions and tasks have been downgraded. In the time of Xi, an ounce of hard power is worth a pound of soft power. For Xi, as for his idol Mao Zedong, what counts is raw power and its exercise. He is clearly a believer in the adage that if an opponent is in a weaker position, it is irrelevant where that person’s heart and mind is, for he will be forced into doing what is wanted of him. This goes for groups and countries as well.

Even the “friendly face” of the PRC, Foreign Minister Wang Yi, is voluble during conversations that his country is 100% right in whatever its leadership says or does, and so discussions need to centre around the sole point of how quickly and smoothly the other side acknowledges such an obvious fact. What counts in the Xi model of governance is facts on the ground, not talks about talks or meetings about meetings. While Indian public opinion saw the Moscow meeting of Defence Minister Rajnath Singh with his PRC counterpart as routine diplomatic courtesy, the Chinese side saw it as a sign of weakness, and promptly stiffened their stance. Such an approach is the opposite of the situation in India, where international talks are given high priority and even visible failures (in terms of getting more than was given away) such as Tashkent or Shimla or the Tibet talks (from Nehru to Vajpayee) are seen as successes, a judgement made purely on the basis of optics. Indeed, optics seems to be the only result that policymakers in India have taken seriously in several situations.

The removal of the two-term limit by PRC President Xi Jinping has been taken as an indication that the CCP General Secretary would like to remain in office until the close of his life. However, the fact is different: Xi Jinping is aiming at China taking on the mantle of the world’s pre-eminent power, displacing the United States, before he completes a third five-year term. This would act as a force multiplier accelerating China’s lead over the US, the way its pivotal role in global commerce and geopolitics has assisted the US in maintaining its position within the global order. Once the milestone of global primacy is crossed, and it is regarded as axiomatic by his team that Xi’s leadership is crucial to such a success, it is likely that the current General Secretary, President and Chairman of the Central Military Commission will follow the example of Deng Xiaoping and take on an honorific title, such as Chairman of the CCP, handing over the General Secretaryship and other posts to trusted associates, although not to the same individual. India and the US are the two countries which figure prominently in the calculations of the team that has been gathered around Xi, individuals seen as the “best and the brightest” that the CCP has to offer. The question is whether they will ensure the success of Xi’s plans, or be responsible for a failure, much as the “best and the brightest” US policymakers in the Lyndon Johnson Cabinet were over Vietnam. The projections of Team Xi for both the big democracies are less than rosy.


The US is seen as having potentially irreversible fault lines based on race, religion and income, which is expected to consume that country in internal strife on an increasing scale. While Joe Biden is preferred by Beijing to Donald Trump in the 3 November 2020 Presidential polls, the latter too is seen as vulnerable because of a “Two-Front” situation. The two fronts are (a) duels with the PRC combined with tensions with multiple countries, and (b) internal fissures created by those around President Trump seeking to impose on the US the same societal structure as was prevalent in the 1950s and in finance as was prevalent towards the close of the 19th century. The Supreme Court in particular is regarded as promising from the viewpoint of engendering chaos, in view of the fact that several of the justices are in effect charter members of the revivalist wing of the Republican Party and are visibly loyal in their verdicts to its tenets. Such a display of judicial partisanship is in the service of an effort to reverse the course of history, most importantly the effort by Stephen Miller and others filled with nostalgia for the segregationist past. The main objective of immigration and “justice” policies is to reverse the steady increase in the non-white population, which is a factor that is deeply upsetting to such individuals. The selection of Kamala Harris as the running mate of Joe Biden has given oxygen to the efforts of such elements out of fear that Biden may, for reasons of health, have to hand over the keys to the White House to a non-white and this not long after the first non-white President of the US was sworn in for two terms. Should the Democratic Party prevail in the 3 November contest, including in the House of Representatives and the Senate, there is likely to be a growing conflict between the Executive and a Judicial branch honeycombed with closet revivalists by the Trump administration. Their power would increase with the likely nomination of another Republican ideologue to replace Associate Justice Ruth Ginsburg on the Supreme Court before the team chosen by the 3 November election gets sworn in. An intensive effort is under way within the US to map for the CCP leadership the faultlines in US society and how they are developing. Or can be developed, a task in which China’s key ally Russia has been assigned to play the lead role on behalf of the common interests of the Sino-Russian alliance. At the same time, packages of misinformation that claim to show that Moscow and Beijing are working not seamlessly together (as is the case) but at cross purposes are being constantly tossed out to credulous policymakers in countries that are identified as hostile to a situation where China replaces the US as the centre of gravity of the international order. As a consequence, there are several policymakers in the US, the EU and India who believe that there is substantial daylight between the strategic ambitions and actions of Putin and Xi. The reality is that both wish to see the end of US primacy, ensure a fissured EU, and a weak congeries of South Asian and Southeast Asian states. Both Moscow and Beijing give an appearance of acting separately and on different sides, when in reality they are synchronising policy (often covertly) to bring about the geopolitical shifts desired by both.


Both Beijing and Moscow regard it as crucial to keep the US and India strategically separate from each other, and the manner in which pro-Pakistan elements have embedded themselves within the Biden campaign has given Putin and Xi hope that a Biden White House would adopt a hectoring and unfriendly tone towards the Modi government. What is causing anxiety is the fact that Barack Obama, who seems close to Joe Biden, tossed away earlier US policy towards Narendra Modi within minutes of the latter winning the 2014 polls and becoming the second BJP Prime Minister of India. A Washington-Delhi pairing as close as the Moscow-Beijing partnership would present an immense obstacle to the global designs of the Sino-Russian alliance, and extraordinary effort is being made by both capitals to ensure that this not take place. This campaign is active in Washington as well, where a whispering campaign has been launched even through improbable channels that India wants to be a “free rider” and is moreover “unreliable and quirky” as a partner. Thus far, this campaign has prevented the US Congress from going ahead with additional legislation designed to make India in law an ally of the US on par with any other country, including treaty allies. A bevy of voices are opposing this on the Hill, most of whom are unaware of the foreign link to their advocacy. At the same time, several channels are being used in Delhi to convey a similar impression of unreliability about the US. Thus far, neither has Australia been invited to the Malabar exercises by India nor has BECA been signed. Keeping the US and India apart is a high priority and thus far, the strategy seems to have delivered results. Within the Biden camp in particular are several individuals who are in close contact with the Pakistan embassy, and during such visits, they “accidentally” meet diplomats from the country that is acknowledged as the single biggest threat to US interests by the Pentagon and the national security system. The close coordination between the Chinese and Pakistan embassies in numerous capitals is no secret. The usefulness of Pakistan in ensuring a covert bridge between Beijing and Washington, this time mostly in matters relating to the US Congress and to elements of the Republican and Democratic parties, is far from over.


Just as the US is regarded as being close to getting tipped into a societal war on a scale that will dwarf the unrest of the 1960s whoever wins on 3 November, India is calculated as being potentially vulnerable to a similar meltdown of public confidence and order. It has been factored in that the continuing credibility of Prime Minister Narendra Modi is key to ensuring a popular level of hope in the future as would prevent mass civil unrest across India. Efforts are ongoing to damage this credibility, and a military setback on the border is seen as the most effective way of bringing down the level of confidence of his people in the leadership of PM Modi. This would be on top of the economic hardship of the recent past. More than in the South China Sea or across the Taiwan Straits, it is the Himalayan massif that is likely to witness a kinetic effort by the PLA. This would be designed to shatter the image and confidence of India. The calculation is that such a setback would discredit those in the US and within the EU who are pushing for a more robust alliance with India. It would also eliminate any confidence within ASEAN that they can rely on India as a counterforce to an expansionist China. Clearly, interesting times are planned for the world’s largest democracy in terms of population.

The nightmare for President Xi Jinping is a military defeat at the hands of a country that is being constantly derided in state media as a paper tiger. Should the General Secretary’s Himalayan adventure end in catastrophe for the PLA, the impact on his leadership would be immediate. Given the governance structure of China, such a meltdown at the core would have a Chernobyl-style impact on the Chinese Communist Party, and a consequent weakening of the CCP’s hold on the people. This would lead to unrest in the PRC (and subsequently in Russia) on a scale that would dwarf whatever takes place in the US and India, even assuming some success in the Sino-Russian “Mission Meltdown” of the world’s two most consequential democracies. Those in the US and India who seek to “prevent war” seem to be unaware that the conflict has already started, and will end only with the defeat of one side over the other.

Ignore Chinese media’s nervously boastful hoots ( Sunday Guardian)


Given the lack of combat experience of the PLA, it is difficult to judge the level of proficiency of soldiers in the PLA when faced with actual combat. What has been seen in recent Himalayan combat is not flattering to them.

There was a movie, possibly Indiana Jones, where a martial arts warrior entered to do battle with the cowboy. After watching him prance around and utter threatening shouts, Jones took out his revolver and very calmly shot the martial arts practitioner dead before the latter had time to land a blow. Or consider the Maori war dance, when fighters shout out fearsome chants in order to overawe their opponents. In the case of New Zealand and its European settlers, the guns that they used with deadly effect on the Maoris did not seem disconcerted in the slightest by the war chants that they witnessed before battle was joined. Instead, the weapons pumped fire on the Maoris and over the course of the campaign, overcame their courageous but futile defence. Some of the writings in PRC media, including English-language publications meant for international audiences, resemble the prancing of the martial arts practitioner and the cries of Maori warriors seeking to stun their opponents into inaction. Since General Secretary Xi Jinping took office in 2012 at the helm of the Chinese Communist Party (CCP), state media have been in overdrive seeking to do what some US publications together with Hollywood have sought to accomplish over the decades, which is to give an impression of invincibility concerning the Peoples Liberation Army (PLA). Especially striking were the lengthy programs in state media of General Secretary Xi reviewing troops on parade somewhere in Inner Mongolia. Xi would utter a short, sharp command to each formation, all of whom would respond back with equal fervour. In PRC movies and on television, PLA soldiers are either pretty (if female) or handsome (when male). It would appear that they have been recruited less for their fighting abilities than for their looks, given that some of the best soldiers in history were not great lookers, quite the reverse, in fact. The building of myths is standard in the polity of numerous countries, especially those ruled by “strong” leaders. The problem comes when the myth gets believed by the mythmaker, or when reality intrudes into the idyll and real life supersedes reel life. The CCP leadership may believe that the trillions of RMB that have been lavished on the PLA will ensure success in battle. They need to look at the historical record, including the failed campaigns against the Taliban by NATO in Afghanistan or against Bashar Assad in Syria. Now President Donald Trump has got signed what is essentially a surrender document to the Taliban, throwing to those wolves the credulous moderates in Afghanistan who believed in US promises. As for Syria and other wars conducted by NATO, what took place as a consequence has been a flood of migrants into Europe that will make the domestic situation in some of the countries there deeply problematic before long.

There is a difference, and this is not small, between battle exercises and actual combat. Given the lack of combat experience of the PLA (excepting recent moves against the Indian Army across the Line of Actual Control), it is difficult to judge the level of proficiency of soldiers in the PLA when faced with actual combat. What has been seen in recent Himalayan combat is not flattering to them. It is obvious that what the Central Military Commission (CMC) in Beijing is worried about is not that Delhi and Washington are too close to each other, for they are not anywhere near a level as would ensure operational certainty and viability. The fear in Beijing is that India and the US may in the near future become as close as what they are alleged by Beijing to be. Preventing that is among the top priorities of the trio of Moscow, Rawalpindi and Beijing and their dupes in Washington and Delhi. Despite its advantages in materiel, the PLA has reason to worry about the capabilities of the armed forces of India in actual combat. If not constrained by timid civilians and if assisted through focused diplomacy and accurate policy priorities, the military in India is a tested weapon of war. The armed forces of the world’s most populous democracy have faced conflict with courage and fortitude, and will have no hesitation doing so again against the PLA, should such an eventuality arise in future. They are unlikely to take seriously the war cries and martial arts movements of the media warriors of the PRC. They know their mettle and are unafraid of battle. Modi 2.0 needs to throw off the self-imposed shackles of the bureaucracy and embark on a phased program of giving training to 40 million young persons in the arts and techniques of war. This would be an NCC-plus program and would include field visits to the best trainees. These trips would be designed to showcase the unique qualities of the civilisation of India. Such a program of training the youth in military and para-military service would be far preferable to leaving this vast pool of potential heroes and heroines to their own devices, thereby risking their getting involved in caste or religious or other conflict. The risk of such misdirection is particularly acute in a situation where the policies followed thus far by North Block and the RBI have kept growth rates low and indeed sharply negative in recent times.

What is equally needed during Modi 2.0 is to establish an Indo-Pacific alliance structure designed to ensure a steady flow of equipment and intelligence such as would deter and where necessary overcome any effort to grab more territory. Rather than merely seek to defend the Line of Actual Control as defined (and constantly expanded) by the PRC, what is called for is an expansion of potential soldier strength added to allies providing backup and logistics.This would enable India to take control of a new Line of Actual Control that would better meet the security and other needs of this country’s 1.3 billion people than the present LAC, which anyway is constantly being shifted against India by the PLA. Whether it be the giving away of military gains at Tashkent in 1965 (or the refusal of the COAS at the time to surround Lahore and Sialkot during the brief war or Prime Minister Shastri’s unwillingness to hold on at Tashkent to the ground positions held by the Army in the conflict), it has been a constant in the history of free India that gains or existing advantages have been surrendered by the civilian establishment at the negotiating table, including at Shimla in 1972 and in other instances too numerous to mention. This is a form of masochism by the politico-administrative elite that needs to be ended not just in words but in deed. This will not be the case unless history books reflect the truth about past mistakes rather than pretend that every decision taken in the past (beginning with the blind support to the obscurantist Ali brothers by the trustful Mahatma during 1917-20) was correct and that the results were spectacular. Freedom of speech and freedom to think must be protected by the courts, should the government of the day refuse to actualise this essentiality of a democracy. The lessons of history rescued from colonial untruth need to be disseminated to the young during Modi 2.0. The young in India have to be taught their history in hues reflecting the national motto “Satyameva Jayate” rather than falsehoods peddled as facts presented in “Cover Up” mode.

What counts in battle is not just the mathematics of equipment and resources but the chemistry of combat. What ensures victory is the will and determination of the soldier in battle, and the confidence and courage of the political establishment in backing rather than constraining the military. Nervous hoots from the PRC state media will not affect either of these harbingers of victory.

Monday 14 September 2020

The LAC situation appears to be 1962 playing all over again, says M D Nalapat ( PGurus)

Even as the External Affairs Minister returns after a meeting with his Chinese counterpart, the fact remains that China is staying put. What are India's options moving forward, what does it need to do with QUAD and in particular why should the US come to India's help is discussed in great detail by Prof. M D Nalapat. A must watch!

Sunday 13 September 2020

Modi can repeat 1971 and ensure a 1962 in reverse (Sunday Guardian)


In absence of a clear understanding between India and US about mutual security, the Himalayan massif seems to be the option offering a higher chance of a Chinese success in 2021 than clearing South China Sea of foreign navies or an attempted takeover of Taiwan.

New Delhi: The difference an alliance makes to outcomes is clear from a readout of the 1962 conflict with China and the 1971 ending of the Pakistan army genocide in Bangladesh. From 1947 onwards, Prime Minister Jawaharlal Nehru focused obsessively on foreign policy, moulding it to his liking. India becoming the leader of the non-aligned movement was regarded by Nehru as a historic achievement. Fifteen years later, Marshal Lin Biao got the nod from Chairman Mao and ordered PLA soldiers to pour across the Tibetan border with India. There was no “non-aligned” country willing to come out in support of India and against China during the conflict. Even countries that had been courted avidly by the Prime Minister, such as Yugoslavia, Egypt and Sri Lanka, avoided giving offence to the People’s Republic of China. As for the US and the USSR, the only countries that could have made a difference in a conflict involving China, the first intervened too late and too insubstantially to alter the outcome, while Moscow adopted the same stance as is being taken by that capital now, which was to avoid taking sides while giving signals of friendship separately to both sides. Not just Congress, but BJP governments have protected the mistakes made in the past from entering the public domain, and even secretive Beijing has released more documents about past policies than has New Delhi. There has, therefore, been little discussion of the frantic cries for help from the leader of the non-aligned movement to the US once Chinese troops began crossing across the border in multiple points and in strength. General P.N. Thapar and Lt Gen B.M. Kaul had fashioned their military strategies on the border on the basis that anything other than dribbles and feints by the PLA was out of the question. Prime Minister Nehru and Defence Minister Krishna Menon took that assumption as an article of faith, exactly as Marshal Stalin had in 1941 when reports began to pour in that the German army was about to launch a blitzkrieg against the Soviet Union. At the precise moment when Hitler’s troops crossed into the USSR in force at 3 am on 22 June 1941, they came across a train loaded with grain from the USSR that was making its way on a bridge across the Bug river. The train was chugging on its way to Germany even as troops from that country had launched an invasion of the USSR. Fast forward to October 1962 and the refusal of key policymakers to understand what was soon coming India’s way across the border with China, despite more than a decade of incessant intrusions, and since the 1959 relocation of the Dalai Lama to India, increasingly bad-tempered commentary on the world’s most populous democracy from the world’s most populous authoritarian state. As in those days, in 2020 as well voices abound who believe that the next summit meeting, the next telephone call, the next expertly-drafted statement, will result in the Sino-Indian border situation moving away from the shadow of impending conflict.


Not that accurate information has been lacking, and not merely to those in the inner recesses of the Government of India but to those much lower down the food chain, including private citizens. On 13 April 2020, even this analyst got to know of PLA troops concentrating across the Line of Actual Control. Subsequently, information reached that the number of soldiers had increased sharply, and had reached the levels needed for a major offensive. On 5 May this analyst was informed by sources of established credibility in a distant location that PLA troops massed across the boundary line had entered Indian territory and were moving at speed across terrain that was being guarded not by the military but by paramilitary formations. What ought to have happened on 13 April took place on 13 May, which was the entry into the theatre of the military, and a consequent halt to the onward progress of the other side. Subsequently, multiple conversations (including at the elevated level of the Special Representatives of the two countries) took place, and it seems to have been assumed by some policymakers in India that the Chinese side had decided to call it a day as a consequence of such conversations. Soon after this comforting thought, the Galwan clashes took place. Now the Moscow talks between the Chinese and Indian Foreign and Defence Ministers have been taken as an indication that the situation has at last been defused. This is unlikely. From the start of his taking over as Chinese Communist Party General Secretary in 2012, Xi Jinping has been taking an assertive stance on PRC claims, adding new ones to the many already enumerated in the past. It is not possible to believe that the movement of PLA forces into Ladakh that began on 4-5 May took place without a nod from the Central Military Commission, the unchallenged head of which is President Xi. Or that the move was not part of a strategy to gain territory in Ladakh so as to consolidate positions held by GHQ Rawalpindi and the PLA in the vicinity. Next year is the centenary of the founding of the Chinese Communist Party, and a military victory is needed to burnish the record of the CCP under its new leader. Beijing intends to take control of the entirety of the Himalayan massif, the South China Sea and Taiwan. There needs to be a military victory as in 1962, not a stalemate as in Vietnam in 1979. The South China Seas are crawling with naval craft of multiple countries, including India, and is at present therefore a difficult location to score a swift triumph. As for Taiwan, from almost the start of her first term in office, President Tsai Ing-wen has focused on linking her country to the US defence supply chain. Over the past four years, ties between Taipei and Washington have grown closer than at any time since President Richard M. Nixon threw Taiwan to the wolves in order to recruit Beijing in his campaign to weaken Moscow. It seems only a matter of time before Taipei enters into a formal security alliance with the US in the manner of Seoul and Tokyo. Ideally, such an alliance would be with the Quadrilateral Alliance, should that group of four countries graduate from a talking shop to a genuine security construct. Given the strategic essentiality of Taiwan remaining outside the grasp of China, it is certain that any attack on the island by the PLA would lead to countermoves by Japan and the US. The latter would, unless in a Biden Presidency the “kompromat” on Hunter Biden is radioactive, escalate the confrontation into other theatres, given the kinetic escalation dominance that the US armed forces enjoy over their counterpart in the PLA. Despite the chokehold that the PRC has over Russia at the present time, the Kremlin (especially under the geopolitical Grand Master Vladimir Putin) would be delighted to see the President of the US intensify moves against China. The farther apart Washington and Beijing are, the more room to breathe that Moscow has. As for India, in the absence of a clear understanding between India and the US about mutual security, the Himalayan massif seems to be the option offering a higher chance of a PLA success in 2021 than clearing the South China Sea of foreign navies by the PLA Navy or an attempted takeover or even blockade of Taiwan.


Should the Indian Army be assured of replenishment by the US of lethal armaments as well as other platforms such as fighter and transport aircraft, any move by the PLA to duplicate its 1962 ingress into Indian territory could be met by a countermove by the armed forces of India that would push the Line of Actual Control substantially outwards from the Indian side. This would result in a humiliation for the PLA that would have significant consequences on the prestige and credibility of the CCP, just as a kinetic setback on the boundary would have immediate consequences for the political establishment in office in India. Much of the difference between what took place in 1962 and what happened in 1971 was the result of the Indo-Soviet Treaty that was the brainchild of former Ambassador to the USSR, Durga Prasad Dhar. The treaty ensured the entry of the USSR into any conflict involving India and a hostile force, and this was sufficient to keep China out of the ring despite plaintive cries from both Yahya Khan and Henry Kissinger for Beijing to send in its troops now that India had committed so many of its forces to the ongoing conflict with Pakistan. For population-reducing moves such as the bombing of Cambodia and backing of the genocide in Bangladesh, Kissinger was awarded the Nobel Peace Prize. During the Bangladesh liberation war undertaken jointly by the Indian armed forces and the Mukti Bahini, Nixon sought to tempt Chairman Mao to intervene on the side of the genocidal Pakistan army by sending in the Seventh Fleet. Treaty ally of India Leonid I. Brezhnev sent in the Sixth Fleet and the Seventh Fleet, not liking the company, made an exit from the seas nearby the conflict. The Indo-Soviet Treaty ensured the absence of China from the 1971 conflict, just as a Quadrilateral Mutual Security Alliance would almost certainly restrain the PLA from using its new firepower on India. Given the risks to the CCP leadership in case there is a military setback (as would be the case were India to get logistical, tactical and intelligence support from other Quad members in the event of PLA aggression), it is unlikely that the Himalayan massif will be chosen as the next theatre for PRC expansionism were the 1971 precedent of a defensive treaty alliance to be followed by India, this time not with Moscow but with Washington and hopefully Tokyo and Canberra as well, besides in time Hanoi, Manila, Singapore, Jakarta and Muscat.


The not insubstantial task given to Moscow by Beijing is to ensure that New Delhi does not enter into a security pact that involves the United States, whether this be a bilateral treaty or as part of a newly formalised Quadrilateral Alliance. In the absence of such a treaty, it would be problematic for Washington to ensure the degree of logistical support that would be needed for the Indian armed forces (Army, Navy and Air Force) to take the battle into the territory of the attacker and humiliate the latter. Conversely, should there be such a pact, the odds are high that the friskiness that the PLA has been showing since 2005 (soon after the self-effacing Manmohan Singh was appointed Prime Minister by Congress president Sonia Gandhi) would diminish substantially. Should it not, from the viewpoint of the Quadrilateral Alliance, any lunge towards hostilities by the PLA would create an opportunity for a newly strengthened India to push outwards in order to gain control over the Himalayan chain and using the opportunity to clear the South China Sea of artificial islands and fortifications set up by the PRC. Given the high probability of the resumption of 1962-scale hostilities by the PLA in 2021, it is a matter of surprise that till now, no effort seems to have been made to formalise the structure of the Quadrilateral Alliance into a mutual defence treaty. What is needed is for India to indicate clearly what is needed for victory in the event of an attack by China, and to work out what needs to be done to formalise a structure that assures such assistance. In 1962, India had neither a security treaty with Moscow nor with Washington. The same situation should not be allowed to prevail in the present. Thus far, Russia seems to have succeeded in its mission of keeping India from entering into a mutual security pact that involves the US. Besides helping China by such abstinence on the part of India, persuading Delhi to remain wedded to non-alignment works to the benefit of Moscow, in that a security treaty involving the US would give an advantage to that country’s weapons systems over the offerings of Russia in a market crucial to the health of the armaments industry in that giant country. There are leaders who play a strong hand poorly. Vladimir Putin plays a weak hand with spectacular success.


Rather than luxuriate in visions of the dragon becoming a vegetarian from its normal existence as a carnivore, what is needed is for India to push a door that is already open. This would be the formalisation of an alliance mechanism involving the Quadrilateral Alliance. This would assure the entry of other partners in any attack on a member of the Quad. What is needed is to work on what would be needed for the armed forces of the Union of India to push substantially outwards the Line of Actual Control in the event of likely PLA aggression. Given the events of the past several years, this is no longer a case of “whether” but “when”. Hence the need to secure an alliance mechanism. In 1971 as well, sceptics within the bureaucracy and the commentariat abounded in the matter of a pact with the USSR. Prime Minister Indira Gandhi went ahead with D.P. Dhar’s suggestion and in the process, changed both history as well as geography. Prime Minister Narendra Modi needs to study the history of the 1962 and 1971 conflicts. Beijing and Rawalpindi look forward to a repeat of 1962. Instead, what they should be served is a repeat of 1971, this time with the Line of Actual Control getting extended substantially across the western side, and fortified in strength on the eastern side. The Himalayan massif is the patrimony of the Indian subcontinent and smart policy based on reality rather than hope anchored to illusions can ensure that this come true once again.

Helping needy urban citizens is good policy (Sunday Guardian)


Among the policies needing to be adopted is an extension of the moratorium by two more years.

Old habits may die hard, but perish they do in most places. In India they seem to linger on and on. Whether it be the Police Code or the Criminal Code, what was designed by a colonial government more than a hundred years ago seems to be accepted as perfectly suited to the India of the 21st century. The reason for such fealty towards a construct that from the start was destructive of individual freedom and endeavour resides in the fact that the greater the discretionary powers, the more the bribe that can be squeezed out of citizens by corrupt officials. The grant of discretion goes on and on. In the New Education Policy, which overall is an immense improvement over the past, it needs to be kept in mind when detailing the new policy that the automatic route should be the rule and the discretionary roadblock the exception. If the certifying official is not among the majority of officials who are honest and conscientious, what some discretionary provisions do is to give that individual an opportunity to try and extract “good will” from an institution every now and then. If any institution is seen as indulging in unwholesome activities, a warning could be given to them to change course and such warnings repeated once again within a reasonable time frame. If they do not change course even after this, either a penalty should be levied or in some cases, certification could be withdrawn, the entire process being made transparent from the start. India has been given a bad name because many times a new government in a state scraps the projects of the previous regime, the way Chief Minister Jagan Mohan Reddy astonished Singapore by walking away from the Amravati State Capital Project that had been agreed upon by authorities in that country and the Andhra Pradesh government under Chandrababu Naidu. Certainly, wrongdoing deserves to be punished, and courts are right to insist on this, for example in telecom. But instead of taking away the licences of all but a handful of operators as a consequence of the 2G case, what may have been more desirable would have been to levy financial penalties on the wrongdoers while allowing them to continue in business. Telecom in India has been drained of competition, and the effect on services is evident. Browsing speeds are slower than those elsewhere in South Asia, while hundreds of millions of citizens still do not have access to the internet, something that ought to be the fundamental right of every citizen.

In India we have seen a forex saving copper company being shut down, thereby resulting in a bulge in imports of that metal. Or the closure of a giant mobile telephone handset manufactory,  resulting in job losses and foreign exchange outgo. Interestingly, the country whose exports to India have gained exponentially from various obstacles to domestic output is China. Several business houses have specialised in substituting domestic products from other manufacturers with imports from China, and this often with money borrowed from public sector banks. Such business houses seem to be happy in their role of facilitators of foreign companies looking to hollow out domestic companies. Instead, such Indian businesses need to make money abroad through exports rather than spend borrowed money abroad on imports. Or in the matter of charity, if every dollar of grant to foreign universities that are given by citizens of India is matched by their 

setting up of world class universities in India, such largesse to foreign institutions already bursting with cash could be excused as a gesture to a university where presumably the sons and daughters of families and friends study. That the colonial mindset is still prevalent in India is clear from the cavalier manner in which a few enterprises have scooped up huge loans from public sector banks and used the money to generate jobs abroad rather than in India, where they are most needed. Neither the RBI nor North Block seems to have any problem with this. What they seem to oppose are suggestions that the moneys going to public sector banks from the exchequer to improve their balance sheets be used to waive the interest during the lockdown of MSME and those stressed citizens with housing and vehicle loans. It would be easy to check on the manner in which the income of a borrower has been affected by the novel coronavirus. In case income has been severely affected (say by a minimum of a 30% cut from pre-pandemic days), the outstanding interest on the home or vehicle loan of that individual should be written off through the moneys received by the banks from the exchequer. Otherwise, once the moratorium is over, such individuals would face default. Barack Obama disgraced himself as President of the United States by allowing in 2009 and subsequently, delinquent financial institutions to gobble up huge cash transfers from the exchequer while standing by as millions of homeowners were made homeless through foreclosures. Why the RBI and North Block are against an extension of the moratorium (by two years, given the damage to the economy that Covid-19 has caused) and writing off the interest payable by stressed borrowers is explainable only by their consistent record of favouring external funds over needy citizens, and their policy of steadily lowering the value of the rupee.

Prime Minister Narendra Modi is making strides in simplifying procedures during his second term. Among the policies needing to be adopted is an extension of the moratorium by two more years, and taking care of the interest cost of the home and vehicle loans of stressed borrowers during the period of the moratorium or in the interregnum, till such borrowers return to financial health (i.e., recover at least 70% of their pre-pandemic income). Such a move would not just make economic but ethical sense. Helping needy citizens, even if they are part of the urban middle class, is good policy.

Saturday 5 September 2020

Israel and Arab countries both gain from better ties (Sunday Guardian)

The GCC needs to reform its economic structure in order to link it with the knowledge economy and retrain young citizens of the GCC.

Since taking over as Senior Advisor to the President of the United States, Jared Kushner built up a relationship of friendship and trust with several royals within the GCC, prominent among them being the Crown Prince of Saudi Arabia, Muhammad bin Salman. The next in line to the Saudi throne had made history by walking away from the Wahhabi ideology that had been linked to the Al Saud family for three centuries. Especially after the Iranian revolution in 1979 and the effort by Ayatollah Khomeini to make Iran the theological centre of gravity in the region in place of Saudi Arabia, hundreds of billions of dollars had been expended by Riyadh in supporting Wahhabi preachers. The money had gone into the building of new mosques and the takeover of existing mosques. Each such change was marked by adherence to the ideology propagated by Abdul Wahhab more than three hundred years ago, which was a stark and ruthless view of the world that saw any difference in practice between his doctrines and the more moderate strands of a great faith as apostasy. Very recently, the Crown Prince has begun the task of revising the theological books written during that period (many with the assistance of US scholars eager to boost Wahhabism as a way of ensuring sufficient recruits for the 1980s anti-Soviet conflict in Afghanistan). The new books will reflect the compassion and tolerance that is at the heart of the Muslim faith. Kushner made sure that the White House backed MBS and his anti-Wahhabi policies rather than go along with the worldwide campaign backed by the Wahhabi International to severely discredit and finally depose the Al Saud reformer. This has to be seen as a plus, as also the normalisation of relations between the UAE and Israel, a process in which he played a discreet but effective role. The rulers of the UAE have seen for themselves the effects of low oil prices. The GCC needs to reform its economic structure in order to link it with the knowledge economy and retrain young citizens of the GCC to develop skills relevant to the industries of the future, rather than remain tied to dependence on oil. Unless this be done, the streets of the cities in the sheikhdoms will seethe and boil over, as took place in 2011 in Egypt, Tunisia and in other countries.

Israel is a Great Power not in terms of territory but in the field of knowledge. Should the education system in the UAE better approximate the technical and pedagogical excellence that is visible in educational institutions throughout Israel, the country would become a model for the rest of the Arab world. Change begins from elementary school, and hence the need to modernize curricula and teaching staff and methods so as to equip graduates with the skills needed to compete globally. The welcome given by the young in Saudi Arabia to the reforms introduced by the Crown Prince indicate that they understand and accept the need for change. Allowing women to drive or involving them in the administration of the holy sites of Medina and Mecca nay not seem significant in some countries, but in Saudi Arabia, they represent amazing and necessary progress. In much the same way, the population of the UAE responded with calm to the announcement of normalisation of relations between the UAE and Israel. The feuds and attitudes of the past must not be permitted to further delay the transformative change that is needed for the Arab world to regain the position it once had. This was as a fulcrum of learning and innovation from which the rest of the world drew lessons. It is to be seen whether Jared Kushner can succeed in getting a few other members of the GCC to follow the example of the UAE and establish diplomatic relations with Israel. The induction of technology and knowhow from that country to others in the region would be an immense force multiplier for good. Meanwhile, the expected opposition has come from neo-Wahhabi countries such as Turkey and Pakistan, where the doctrine is putting down strong roots that are causing social cleavages and economic distress. As for Iran, Khamenei seems to have adopted the fantasy of Imam Khomeini, which is that unconditional support for what is defined as the “Palestinian cause” (which is to try and end the existence of Israel) is the key to winning over the billion-plus Muslims across the world. This was not the case in 1979 and is visibly not so now, and Supreme Leader Khamenei has made Teheran follow policies that have had the effect of impoverishing a country with a gifted and generally moderate population.

There has been much speculation about a reversal of US policy should Joe Biden prevail over Donald Trump on 3 November. The 45th President of the US followed a policy of indiscriminately and thoughtlessly reversing the policies of his predecessor Barack Obama. Such reflexive action by Trump may be the single biggest reason why Biden is favoured to become the 46th President of the US, and it is doubtful that the experienced and wily politician from Delaware would repeat the mistake of his predecessor and throw out all signature policies of Donald Trump, including the successful bid to ensure a better relationship between the Arab states and Israel. In this, as in some other matters, including Trump’s hard line on China (also favoured by Senators Bernie Sanders and Elizabeth Warren), a President Biden is likely to continue on the path of his predecessor. It must be said that only in the Trump Presidency did the White House understand what has been obvious to the Chinese for decades, which is that the US and China are engaged in a battle as consequential for the future of the world as that which took place between the USSR and the US. Now that this has been understood, Biden is likely to go along with US public interest and opinion and retain a hard line on the PRC. The chances are that Susan Rice will be part of his team, perhaps as Defense Secretary or Secretary of State, and she is clear-eyed on China, just as is Vice-Presidential nominee Kamala Harris.

On 3 August, a summit (organised by the American Jewish Committee and the Sunday Guardian Foundation besides the indefatigable Dr Bharat Barai) took place between officials and scholars of India, Israel and the US. The three have a common interest in ensuring that the Indo-Pacific remain free and open to all rather than become the monopoly of any single country. They also have an interest in working towards the overcoming of extremism and the progress of stability and moderation in South Asia as well as the Middle East. Prime Minister Narendra Modi has shown that relations between the Arab world and Israel are not a Zero Sum game, in which good relations with one side leads to bad relations with the other. Now the UAE and Israel have once again shown that better ties between Israel and the Arab world are a win for both sides.