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  • Strategic Autonomy and the Looming Oil Crisis

    Strategic Autonomy and the Looming Oil Crisis

    Kamal Davar                                                                                             May 31, 2019/Commentary

    The new Modi government will have to speedily contend with a serious foreign policy challenge on its hands.

    That this ordeal comes in the wake of some underplayed serious economy problems currently facing the nation will compound the problems for India which imports over 80 per cent of its burgeoning oil needs.

    Thus, if the looming crisis in the Persian Gulf between an arrogant US and an equally defiant Iran does not get resolved peacefully, ominous ramifications await the region, the world and all those nations which import crude oil from Iran.

    The genesis of the current crisis between the US and Iran has its roots in the Joint Comprehensive Plan Of Action (JCPOA) which was agreed upon by Iran and six western nations in 2015, led by the US, to curb Iran’s nuclear programme, which boils down to deterring Iran from developing nuclear weapons. But in May 2018, the US, under its mercurial President Donald Trump, chose to renege on this treaty as Trump felt that this was the “worst deal ever negotiated.”

    It is also a fact that Iran did not violate any norms of the law as regards this agreement.

    Meanwhile, the US allowed some nations, including India, which import oil from Iran a six-month waiver, which ended on May 2, 2019. As a consequence of the US action, oil prices the world over have jacked and soon its adverse effects will be felt in India as inflation will hit the already strained Indian economy. Over a 10 per cent hike in global oil prices has already taken place in the last one month and a crippling escalation in oil prices ahead is well on the cards.

    Notwithstanding any US pressure on India, the unalterable fact of Iran’s strategic significance to India in the region remains beyond question. India imported 24 million metric tonnes of crude from Iran in the 2018-19. India was Iran’s second largest buyer of crude last year, while Tehran was the third largest supplier to India after Iraq and Saudi Arabia (11 per cent of a total of India’s oil imports).

    Additionally, Iranian crude comes with a longer credit period and cheaper freight owing to Iran’s geographical proximity to India and, thus, Iranian oil remains the best option for India in more ways than one.

    Higher oil prices also make the Indian rupee weaker, making imports to India costlier. Importantly, that Iran-India collaboration in the development in the vital Chabahar Port in Iran will give India vital ingress to Afghanistan and the Central Asian Republics cannot be understated.

    Meanwhile, the US has rushed the formidable USS Abraham Lincoln carrier-borne Task Force to the Persian Gulf region and undertaken certain prophylactic steps in case war breaks out.

    The Iranians, too, have mounted some small-range anti-ship missiles on their warships. Iranian President Hassan Rouhani recently said that his nation is facing acute pressure from international sanctions, dubbing it a “war unprecedented in the history of the Islamic revolution.”

    The US has also branded Iran’s elite Revolutionary Guards as a foreign terrorist organisation. A war of words has broken out, with President Trump declaring that if “Iran wants to fight, that will be the official end of Iran. Never threaten the United States again.”

    Replying back sternly, Iranian Foreign Minister Javad Zarif retorted that Iranians have stood tall for millennia against aggression and that “economic terrorism and genocidal taunts won’t end Iran.” He added that “never threaten an Iranian. Try respect it works.”

    Importantly, even US allies have steered away from of taking any partisan positions with either the US or Iran. Meanwhile, oil-producing nations like Saudi Arabia, Kuwait, Mexico and the US itself have been requested to step up their oil production to cater for Iranian oil shortfalls.

    How this oil crisis will shape up to meet global demands is anyone’s guess.

    It is a strategist’s nightmare in conjuring up a scenario concerning the ramifications of a war between Iran and the US. The Persian Gulf is easily one of the world’s critically significant strategic waterways through which one-third of the world’s oil is transported.

    In the event of a war, Iran will definitely close the vital Straits of Hormuz for commercial shipping purposes, throwing the region’s economy out of shape — an eventuality which, hopefully, should not ever take place.

    Preoccupied with its General Election, India, as a major regional player, has so far not reached out to its strategic partner, the US, to impress upon it to defuse the crisis.

    Recently, the Iranian Foreign Minister made a trip to India to explain their position to India on the current standoff.

    India, however, need not succumb to any US pressures or take sides. India has an adequate financial standing and moral stature to play a peacemaker’s role. India must conscientiously follow the time-honoured policy of zealously guarding its strategic autonomy. Respect for India from nations even adversarial to each other — as in earlier decades — will follow automatically and some of India’s economic tribulations will also get simultaneously addressed.

    Let the new government in New Delhi bear in mind Iran’s more than significant strategic value for India in the region.

    The author, Lt Gen Kamal davar is a former DGDIA and is visiting Distinguished fellow at TPF. 

    This article was earlier published in The Tribune.

  • The Chinese diaspora in Europe: Serving the motherland from abroad

    The Chinese diaspora in Europe: Serving the motherland from abroad

    Andrei V Korobkov, Nikolaj A Sluka, and Pavel N Ivanov                          May 31, 2019/Analysis

    Europe, one of the largest immigration systems of the world, is experiencing currently a test of strength under pressure coming from a powerful new wave of migrants from the Muslim countries of the Middle East and North Africa (MENA) caused to a large extent by the Arab Spring.

    According to Eurostat, arrivals from the Middle East to the EU were estimated at 1.5 million in 2015 and 1.8 million, in 2016. With the accumulation of economic problems and the escalating ethnic tensions in many countries of the region, demands are intensifying for a strict limitation of immigration and the reorientation of migration policy towards the primary acceptance of highly qualified migrants while limiting simultaneously the admission of practically all other categories of immigrants, including refugees. During his term in office, Nicolas Sarcozi, the former President of France, spoke, in particular, of the need to switch from «suffered» to «chosen» immigration.

    Regardless of the growing realization of the problem’s acuteness by political elites, no effective measures have been introduced yet to deal with it. As a result, criticisms of European migration policies are intensifying. The problem cannot be limited to migration and minorities issues. These are not synonymous with poverty, unemployment, social frustration, and aggression that the Brits, for example, view as the root causes of pogroms in their cities, while considering white youngsters (chavs) as their main perpetrators. The crises also hurt representatives of the middle class, deepening the gap between them and the rich. This does not resolve the problems related to the integration and adaptation strategies, multiculturalism, cluster and dispersed settlement, and the links of those with the issue of social mobility or the lack of the latter.

    The challenge of multiculturalism still remains a headache for many Western European governments as well as for the supporters of tolerance and multiculturalism concepts in general.

    The challenge of multiculturalism still remains a headache for many Western European governments as well as for the supporters of tolerance and multiculturalism concepts in general. Prior to the start of the June 2018 EU leaders’ emergency summit, dedicated to the issues of migration, the French President Emmanuel Macron stated that the EU migration crisis has been transformed into a political one.

    With this background, immigration to Europe from China remains to a large degree an invisible one. This is explained partially by the different scale of the incoming migration flows as well as by their origins. In 2016, the Chinese comprised just 3% of 76 million international immigrants residing in Europe. While the huge potential scale of the Middle Kingdom’s population mobility is well understood, that country traditionally prefers to act «in the shadow zone.»

    In contrast to Muslim immigration, caused to a large extent by the Arab Spring and thus having a forced, push character in the countries of emigration, the Chinese immigration could be characterized as a product of a merger of the ideologies of the receiving states, relying on the concept of multiculturalism, and the sending country, pursuing the «going out» policy.

    With a relatively long history of Chinese immigration to Europe, experts concentrate their attention on its most recent wave, the so-called New Immigration that started at the inception of China’s economic reforms and the policies of Openness. This migration wave is marked by a balanced gender structure and high shares of younger age cohorts, well educated and highly qualified people, aiming at the assimilation within the European societies, allowing them to find a job within the prestigious segments of labor market. This migration wave has significantly boosted and qualititatively transformed the process of the ethnic diaspora formation in the region. Exactly this New Migration is defining the main quantitative parameters of the diasporaand is responsible for the formation of the «model ethnic minority» stereotype that has become deeply ingrained in American public consciousness.

    There also exists another “shadow” component of this migration flow represented by the industrial workers and service personnel who as a group have quite different demographic parameters and are marked by the relatively low levels of educational achievement, well being, and language proficiency. This latter group also includes undocumented migrants. This is a different and quite poorly explored up to this point area of research.

    The emergence of deep fracture lines separating the host countries’ native populations and the politically and socially deprived immigrants who differ in language and religion – the concept defined in classical Political Science as mutually reinforcing cleavages – is less likely in this situation, marked by quite heterogeneous structure of the immigration flow.

    The fact that the main immigration flow is centered on a relatively narrow group of receiving states reinforces contrasts in the territorial distribution of the Chinese diaspora in Europe.

    The fact that the main immigration flow is centered on a relatively narrow group of receiving states reinforces contrasts in the territorial distribution of the Chinese diaspora in Europe. Its overall numerical strength has an expressed meridian gradient, declining in the West-East direction, and nearly directly correlates to the geography of the economically developed and populous countries. More than 98% of the diaspora is located in just 10 countries, while 50% lives in the UK and France. Large Chinese communities have been formed in Germany and the Netherlands as well as in Italy and Spain — the latter being the countries that have relatively recently offered amnesties for illegal immigrants. On this background, less visible are the countries of Northern and, especially, Eastern Europe, that for the first time opened their borders for Chinese immigration just in the 1990s. The exception represent just Hungary and Romania, having a relatively higher share of the Chinese in their modern immigration flow structure.

    The «Chinaization of Europe» issue is acquiring a partially local character in the context of escalating leadership struggle among the world’s major powers in the framework of transition to the third global integration cycle. It is important that China is viewing emigration in the context of its «going out» strategy and in combination with other «soft power» mechanisms, involving the cooperation with European states in various fields — economic, investment projects, research and development, educational, socio-cultural etc. More than that: official Beijing is incrementally cutting on the projects that were designed to promote migrants’ repatriation or aimed at the replenishment of the human capital reserves, and is transiting to a large scale «Serve the Motherland from Abroad» stategy. The main task is to form the China-centered interlayer as a factor of state influence in host countries with high levels of ethnic communities’ concentrations. In the future, the representatives of such influence groups are expected to become deeply ingraned into the social, political, and economic life of the receiving countries in order to be able to lobby China’s interests in case of necessity. Thus the main emphasis will be made on preserving and strengthening the diaspora’s national consciousness, promoting China’s future global political and economic superiority.

    Andrei Korobkov is Professor of Political Science and International Relations at Middle Tennesse State University, USA. He is a non-resident, visiting Distinguished Fellow at TPF.

    Nikolaj A Sluka is Professor of Geography at Moscow State University, Russia.

    Pavel N Ivanov is pursuing his MS (Geography) at Fudan University, Shanghai, China.

    This article is published earlier in BRE Review of University of TURKU.

    Photo by Vladislav Vasnetsov from Pexels

  • India’s Farm Distress: Priority and a Challenge for the New Government

    India’s Farm Distress: Priority and a Challenge for the New Government

    Manjari Balu                                                                                                         May 30, 2019/Analysis

    A deliberate campaigning strategy of the National Democratic Alliance (NDA) led by Prime Minister Narendra Modi has yielded an expected victory in the 2019 Lok Sabha election. The election season had sparked off many appealing promises; one of them pertains to, agriculture, the most critical sector of the Indian economy. The agriculture sector contributes to 12.2 % of the GDP (it has fallen from 17.6% in 2004-05 to 12.2% in 2016-17) for the year 2017-2018 and roughly employs 50 % of the total workforce. The agrarian structure continues to suffer while political parties competed on the delusory promises during the campaigns. NDA government with a special focus on agrarian society has branded its promise to double each marginal farmer’s income by 2022. A pedestrian cash transferscheme has been propelled during the interim budget to provide INR 6000 (per year) to all the marginal farmers who hold less than 2 hectares of land. A valid scepticism about the promise stems out of the fact that there exist an unavailability of data about the farmers’ income and all the political parties refuse to talk about the farmers’ current income. Cash transfer scheme being an attempt to mollify the accumulated antipathy among the public especially farming community has to be scrutinized and put under the radar for substantial discussion.

    Agriculture Distress and the Marginal Farmer

    According to last published NSSO figures for the years 2012-13, farmers’ income averaged out to INR 6,424. Extrapolating the past data to arrive at the 2018-19 income using Compound Annual Growth Rate (CAGR) to the nominal gross value added components of agriculture, cash transfer of 6000 would account for merely 6 % of the total farmers’ income. The Chief Economic Advisor claimed that the annual transfer to marginal farmers would be 17 %, an assertion backed with no clarification. The nebulous methodology to estimate income seems to question the effectiveness of such a policy instrument to address the perennial agricultural distress.

     The agrarian economy has been volatile over the past few years and the well-being of the farmers have always been the litmus test to review the performance of the sector. Around 87 % of the farmers are small and marginal farmers with less than 2 hectares of land holding, this figure seems to be swelling- indicating an objective failure of the land consolidation reforms in the past few years.

     There is a steady decline in the population engaged in agriculture to the total percentage of employment since the beginning of the independence. Displacement of agriculture labours to other sectors is inevitable if there is a gradual policy shift to mechanization of agriculture and capital formation, the eventual effect of the investment is ought to be reflected in the productivity. But between the years 2011 and 2015, agriculture workforce declined by 12.6 million, and the labour force increased by 14 million but total employmentin the economy increased only by 12 million. The incongruity in the figures proves the inability of the nonfarm sector to absorb residual workers out of work. Further, it is erroneous to premise the out of work farm labourers as an ultimate result of only innovation in agriculture. Status of unemployment has to be confessed and measures to provide employment has to be prioritized. It is apparent that the incumbent administration is resorting to the same banal and anodyne prescriptions that preceded it in its attempt to curry favour with the agricultural voter base, which had been promised employment during the 2014 election.

    The incessant crisis is evident from the past records of famers’ suicide data published by National Crime Records Bureau; however, the report faces severe criticisms for underreporting deaths. Though there are various socio psychological reasons for suicides, indebtedness has been considered the primary cause of death. A mere addition of cash transfer might marginally ameliorate farmers’ debts but heavy dependence on informal credit system requires the government to resolve the gaps in current credit system.

    Policy Challenge – Dealing with the Debt Problem

     The Debt Asset Ratio (DAR) indicates the quantum of indebtedness among farmers, since 1990 the ratio has increased at an astounding rate of 630 % in 2013. One commonly posited explanation for the skyrocketing DAR is the excessive informal borrowings by the farmers while the asset value remains stagnant. The perpetual ignorance by the government to address the structural issues over decades pushed the farmers to demonstrate a protest and subsequently resulted in the electoral setbacks of BJP post the protest.

    The apprehension is beyond agricultural and institutional policies, food inflation rates have fallen from 12.9 percent from 2013-14 to 0.13 percent in 2018. Even though the low inflation rates benefit the consumers in general- it would also imply the low food prices would be way below the input costs and return on private investment would be less if not non-existent. Government’s efforts have had little effect on keeping the inflation at a steady rate; the extreme movements of the inflation rates exacerbated the condition of the agrarian economy. The Government has announced to fix Minimum Support Price (MSP) at 50 % above the cost of production as per the recommendation of agricultural scientist Dr.Swaminathan. However, the recent protest placed a demand to change the method of arriving at the MSP figure. Pseudo free market behaviour from the government side has altered the market structure and mostly worked against the welfare of the marginal farmers. While the APMC (Agricultural Produce Marketing Committee) controls the MSP, the small farmers are expected to reach out to the market with a higher transaction cost and end up with much lower revenue. The state has failed to acknowledge the governance failure and continues to place MSP in an equivocal position in every budget. Cash transfers schemes have been placed in the budget with a similar ambiguity in terms of its impact on agricultural productivity and growth. There is a paucity of literature that provides a lucid explanation for execution of cash transfer. A recent study conducted in the rural parts of poor Indian states with 3,800 samples concluded that only 13% of the respondents preferred cash transfer over public health care facilities. Though it is not as same as providing cash transfer to farmers, similar schemes in the past have failed to create a sanguine impression and has made the beneficiaries dubious about such ambitious policies. The sample is also not a true representation of the agrarian community, sector which has been victimized for decades and would vote for short term benefits that risks stagnant productivity and falling workforce.

    The Paradox of Indian Agriculture

    Indian agriculture faces many challenges and is a paradox. India has the second largest area of 159 million hectares in the world as arable land, next only to the United States.  India is the second largest producer of Rice, Wheat, fruits and vegetables. India is the largest producer of bananas and mangoes. Export of agricultural products have ben growing at over 4% year on year. Despite all this there has been great volatility in agricultural economy over the last decade. Growth has been uneven, marginal farmers find farming becoming very uneconomical, and there has been significant decline in marginal farm holdings from 2.27 hectares in 2002 to 1.07 hectares in 2015. While big farmers have sustained themselves well, it is the marginal farmers who have continued to face increasing stress. While many encouraging policies and financial support schemes have been announced, in reality the implementation has been ineffective if not shoddy. Most planned investments and financial assistance have not reached the desired target populace.

     Investment in agriculture GDP has declined from 3.3 % in 1980-81 to 2.9 % in 2013-2014 while the subsidies on fertilizers has increased by 15 times in the same time frame after adjusting to inflation. Fertilizers subsidy accounts to 47 % of the total subsidy in the budget for the year 2017-2018 and amounts to almost Rs.70,000 crore.  Shenggen Fan and Ashok Gulati in their landmark studyto compare relative benefits of investments versus subsidies used a well-established statistical method ‘multi-equation system’. For every 10 lakh invested in agriculture pulled 328 people out of poverty and every one rupee spent on Research & Development increased the agriculture GDP by Rs11.20. The study also suggests that the inefficient input subsidies have actually been more counterproductive by hindering new investments and choking agriculture growth. Member of NITI Aayog and a renowned agronomist, Ramesh Chand had commented that research and development spend in India is not far behind China, a statement that calls for a reality check. For two decades India’s R&D spending as a percentage of GDP has been around 0.6 % while China spends around 2.1 % and Israel with the highest percentage if 4.2%. In absolute terms India invests 5 times lower than China and Israel. An effort on research & development is rather ostensible given less attention in the budget allocation.

    Conclusion : Need for Effective Policy Actions

     There is a conspicuous need for the government to assess the impact of cash transfer to farmers as a policy with various dimensions. The extent to which it can reconcile the distress in farming sector has to be scientifically proved to justify the quantum of investment for execution.  Heavily subsidized agriculture and loan waiver always helped with political victory but the fundamental crisis has been unceasing. Even an elementary study on trends in agriculture seems to highlight that it requires prompt moves and strong long term goals. Policies’ pertaining to agriculture has to be a parcel of broader strategies. Tactics of transferring cash with minimal sanction from experts reserves its place only as a political expediency.

    Marginal farmers and fragmented landholdings are the bottlenecks that prevent effective modernisation of Indian agriculture. The government will need to play a major role in evolving policies that create inclusive solutions to overcome the problems of marginal farmers. Agriculture in India continues to be in the grips of manual and subsistence farming without farm mechanisation or technological inputs. Average landholdings have shrunk from 2.28 hectares in 1970 to 1.08 hectare in 2015 (NABARD). Promoting cooperative farming will allow small and marginal farmers to take advantage of their family labour. Corporate farming, meanwhile, could allow economies of scale to kick in at lower thresholds.

    Yet again, hollow electioneering masquerades as policy with the advent of the great festival of democracy.  Now that the new government is in power, it is time that agriculture is given the due attention it deserves with a long-term strategy to resolve the problems of marginal farmers, fragmented land holdings, and the urgent need for rapid modernisation of agriculture and a national policy on water resources management.

    Manjari Balu is a Research Analyst at ‘The Peninsula Foundation”. She holds a degree in economics. Opinions expressed are the author’s own.

    Photo by Nandhu Kumar on Unsplash

  • Qatar Rafale Issue: Getting a Realist Perspective

    Qatar Rafale Issue: Getting a Realist Perspective

    M Matheswaran                                                                                                       May 23, 2019/Commentary

    Over the last two weeks, much has been written about the controversy emanating from the possibility of Pakistan Air Force pilotshaving trained and flown the Rafale aircraft in France. A lot of concern has been expressed about the operational capabilities of the Rafale being compromised. One needs to examine this carefully. A better understanding of technology would make it easy even for the layman to appreciate and deduce from available open source knowledge what  modern aircraft are capable of. Given this, one can imagine what a trained and experienced fighter pilot would be capable of deducing, and hence evolve his tactics, by visually observing and studying various parameters of the aircraft, leave alone flying it. Hence, to get a realist perspective of this situation, we need to examine various factors, particularly Qatar-Pakistan relations.

                But first take a look at the technical issues. The Rafale is a 4.5 generation aircraft. Its design, in terms of its clean aerodynamics and an optimal design to create minimal radar signature, would make it clear to any professional that this is an aircraft capable of exceptional manoeuvring. It is also an established fact that amongst all 4.5 generation aircraft, there would be very little difference in terms of combat performance. Quite obviously, the most critical elements of the aircraft consist of its sensors, avionics systems, radar, and weapons. Both India and Qatar have contracted for similar version of aircraft, F3R.The systems and weapons have some similarities but also major differences. Modern fighter aircraft are systems intensive and function as system of systems.

                Features that are common to both Qatar Air Force and Indian Air Force Rafales are primarily the RBE 2-AA AESA radar, SPECTRA self-protection suite, IFF with full Mode-5/Mode-S compatibility, Elbit’s TARGO-II Helmet Mounted Display System, and some of the most critical weapons such as Meteor BVRAAM, Mica air-to-air missile, and SCALP air-to-ground long-range cruise missile. Anyone who flies the aircraft will, obviously, get to know the full functioning, performance, and envelope of the systems and the weapons. Most critical would be the intimate knowledge of the AESA radar and the important weapons. However, one must understand that deeper technical knowledge of systems like the radar would not be available to Qatar. Given the long-standing relationship between France and Qatar, any high level systems programming and integration would be retained by the French. This has been the practice in the past, and it is so with most Arab countries. Additionally, AESA radar configurations and source codes are highly secure and it would be virtually impossible for anyone to break into it, even if we assume that Pakistani pilots and technicians would make an attempt to do so, which is very unlikely. Weapon envelopes would certainly be known in the course of training on them. Training on systems like SPECTRA, while providing its functional knowledge, does not compromise any security. The crux of SPECTRA lies in its threat library programming, which is exclusive to the host nation, and on response algorithms that will not be open to anyone other than the designer.

                Indian Rafales, however, will have significant security measures. These lie in completely different secure communication systems that would be incorporated, and India’s own secure datalink capability that would be incorporated. Qatar Rafales would have the Link-16 compliant datalink systems, which India will never incorporate. As the French Rafales upgrade to F4 status, much of those upgrades may become available to India, and IAF aircraft will become uniquely different and highly secure with its own NCW architecture. In terms of EO designation and Recce pods, Qatar Rafale will have the Lockheed Martin’s Sniper pod while IAF have the well-proven and advanced Litening-4 EO pod integrated. EW capabilities and hence, EW tactics and strategies will be completely different for IAF’s aircraft. Unlike in the past, this contract envisages French cooperation and full access to integrating additional weapons and systems of India’s choice, which will make the aircraft considerably different.

                So what should we make of the news about Pakistani pilots flying the Rafale in Qatar and subsequent denial by the French ambassador in India? As for Pakistani pilots sizing up the Rafale against the F-16, it is a non-issue as the two are just not comparable. The upgraded F-16s of PAF is of Block-50 standard at best, and that is clearly one generation behind Rafale. The concern, therefore, is irrelevant.

    One must take into account various regional geopolitical issues to get a realist perspective. Qatar is a small country of 2.8 million inhabitants, with nearly 80% of the population located in the capital city of Doha. With highest per capita GDP in the world, Qatar focuses on rapid development towards first world status, and displays its ambitions in playing a geopolitical role, punching well above its weight much like Singapore. Doha has been host to major international events, and will be hosting the FIFA 2022.

                Considering that Qatar is a tiny kingdom on the Arabian peninsula, Saudi Arabia has always tried to dominate and control the state as a subordinate. Qatar has successfully dismissed these attempts by breaking out and engaging countries at the global level. It has made itself a major diplomatic player, a generous donor of foreign aid, and a leader in modernising education in the region. It has maintained strong relations with Iran and Turkey as much as with other Islamic states. It has sought to balance different groups and organisations with a moderating influence and has sought to push for peace in the region. These efforts, and the overwhelming popularity of ‘Al Jazeera’ has riled countries like Saudi Arabia, Egypt, Bahrain, and UAE into sanctioning Qatar and curtailing diplomatic relations.

                Pakistan, which has very strong relationship with all Arab countries, has maintained a neutral stance in the Qatar-Saudi Arabian dispute, despite strong pressures from Saudi Arabia. Pakistan’s military presence in these countries, in terms of training local forces as well as providing fully deployed troops to augment local defences has been a long-standing practice. Pakistan Air Force pilots have regularly flown for the Air Forces of these states. Hence, access to military resources in terms of operational flying experience on these aircraft has been a huge advantage for PAF. Since the Iraq war in 1991, Qatar has sought to build a significant military capability, its Air Force in particular.

                While India and Qatar have excellent relations (Qatar meets nearly 60% of India’s LPG needs), to meet its military training and force requirements Qatar has engaged Pakistan’s services in addition to European and British professionals. All these pilots, essentially mercenary in nature, have become Qatar citizens as well. Qatar has provided air base for US air forces  at al-Udeid, 20 miles from Doha. The base services US Central Command, including US forces in Afghanistan and Syria. Qatar addresses Pakistan’s energy security significantly, and both nations have cultivated their relationship carefully. Qatar has allowed Taliban to set up office in its territory and has worked to encourage dialogue with all parties involved in the Afghan conflict. In return, Pakistan has been careful to balance its relations with all gulf countries, and values its engagement with Qatar highly, as the recent visit of Pakistan’s Prime Minister shows.

                For a very small state, Qatar is on track to building significant air power capability. After signing initial contract for 24 Rafales with French Dassault in 2015, Qatar placed additional orders for 12 more aircraft, making it a total of 36 Rafales. This was preceded by an earlier order for Boeing’s 36 Qatar advanced-variant Eagles from the USA for $ 12 billion, with an option to increase the order later to 72. In another major deal with BAe, Qatar concluded a contract for supply of 24 Eurofighter Typhoons and 9 Hawk advanced jet trainers, worth over $ 6.6 billion, with first payment made in Sep 2018. For an air force whose strength was just 2100 personnel in 2010 and just 13 Mirage 2000-5 fighters in early 2000s, this build up with three fleets of 4.5 generation aircraft and substantial increase in numbers is unprecedented. Qatar’s decision to go in for a seven-fold increase in its air power capability is curious and there are questions as to how this tiny air force will absorb the massive capabilities in which it is investing. More importantly, it is inevitable that it would need pilots on hire to fly these aircraft. This where the Pakistani relationship comes into focus. In addition work is already underway to increase the infrastructure  in terms of building an additional base and expanding existing bases at al-Udeid and Doha.

                Pakistani pilots who fly for Qatar air force may do so after being given Qatar citizenship. Unlike India, Pakistan allows dual citizenship passports. It is therefore, quite obvious that Pakistani pilots will fly all these aircraft being procured by Qatar. It is irrelevant whether they have been trained in France on Rafales contracted for Qatar, in all likelihood they would have. India, therefore, would do well to factor this reality in its calculations.

    The author is the founder Chairman of TPF, IAF veteran and former Deputy Chief of Integrated Defence Staff. Opinions expressed are the author’s own.

    A shorter version of this article was published in Deccan Herald.

    Image Credit – rafale.co.in

  • 91st Amendment: Impediment to Good Governance?

    91st Amendment: Impediment to Good Governance?

    Mohan Guruswamy                                                                                         May 23, 2019/Analysis

    Soon it will be loaves and fishes’ time when ministries will have to be distributed to accommodate personal aspirations. How many can partake in the feast is limited by the 91st Amendment. But does even this contribute to better governance? Perhaps this period of transition is just the time to consider the limitations of the 91st Amendment?

    On July 7, 2004, the 91st Amendment to the Constitution took effect. This meant that from that day on, the size of the councils of ministers at the Centre and in the states could not exceed 15 per cent of the numbers in the Lok Sabha or state legislatures. The logic underlying this amendment was quite obvious. The cost factor was not the issue, for in relation to the overall cost of government, expenditure on ministers is miniscule. The real problem is that with unlimited ministerships on offer, the destabilisation of governments was made easier. Unfortunately, there seems to be little realisation that too many cooks spoil the broth. Who can deny that our governments have so far only served up a vile and poisonous broth that has enfeebled the majority and kept the nation misgoverned?

    Even the National Committee to Review the Working of the Constitution (NCRWC), set up by the Atal Behari Vajpayee government, which recommended that the number of ministers “be fixed at the maximum of 10 per cent of the total strength of the popular House of the Legislature”, does not seem to have thought this matter through. But even its recommendation was tweaked a bit to fix the ceiling at 15 per cent, as we seem to have too many overly keen to be of greater service to the public by becoming ministers.

    It would seem that the only reason why the amendment was whisked through, and whisked through is the only description for it for it was hardly discussed in Parliament or in the media, was to afford political managers some protection against the clamor for berths in government. Like good politicians, they naturally expect to come out smelling of roses at the same time! But there could be an unstated reason as well, that might have to do with distribution of wealth. Too many thieves could reduce the individual take? That, and making ministerships too commonplace, only devalued the worth of the jobs.

    Whatever be the reason for the ceiling, good governance or management principles seem to have little to do with it. We have 543 MPs in the Lok Sabha, which means that we can have up to 81 ministers in New Delhi. With 787 MPs in both Houses, that means almost one in nine MPs can expect to be a minister. The states have in all 4,020 MLAs; opening up possibilities for around 600 ministerial berths for 4,487 MLAs and MLCs. Uttar Pradesh has the biggest Legislative Assembly, with 403 MLAs, while Sikkim at the other end of the spectrum has to make do with just 32 MLAs or just five ministers.

    Quite clearly, the persons who applied their minds to this amendment have not seen government as a responsibility that has to be sensibly shared and not as a basket of fruits to be distributed. No organisation that is meant to function can be designed on such a basis. Analogies are seldom entirely appropriate, but you will see what one has in mind when you consider the absurdity of limiting the number of functional responsibilities in a company to a function of the number of workers on the payroll. Management structures and hierarchies are based on assignment of responsibilities based on a division of work according to the technical and managerial specialisation of tasks. Thus a company might have heads for the production, marketing, finance, HRD, legal and secretarial, and research functions. In small companies, just one or two persons may perform all these functions, while in a large professionally-managed corporation there would be separate or even more heads of functional areas. But you just can’t link th
    is to the number of workers. The important thing is that management structures apportion tasks and responsibilities according to specialisation.

    Obviously, the management of government is a much more complex, with an infinitely larger set of tasks than the biggest corporation, however professionally managed it may be. But to divide the management of the state into 39 functional responsibilities, as is the case now, is to exaggerate that magnitude and complexity. It is as if in an automobile company making and selling cars, the person responsible for making gearboxes is at the same level as the persons looking after the paint shop or procuring accessories. As if this was not bad enough, all these would then be at the same level as the head of production or marketing or finance. Yet this is how the Cabinet is organised. There is a minister for rural development and a minister for panchayati raj as there are ministers for irrigation and fertilisers, sitting on the same table as the minister for agriculture.

    We know that all agriculture is rural and everything in the rural world revolves around agriculture, and so the case for separating the two goes straightaway. Besides, agriculture is about water, fertiliser, food distribution, food processing, agro and rural industries. And who has heard of forests in the urban areas? Thus, instead of having one person responsible for improving the lot of our farmers and rural folk, we have nine departments headed by nine ministers. They often work at cross purposes. Even if the ministers are willing, it will be almost impossible to make the bureaucratic structures march to the same beat. And so if the rural sector continues to languish, no one is responsible.

    This was not the case 50 years ago. In Jawaharlal Nehru’s first Cabinet there was only one minister for food and agriculture. The only agriculture-related function not with this minister was irrigation. Gulzarilal Nanda held the portfolio of planning, irrigation and power. But in those days additional power was intended primarily from hydel projects and it thus possibly made sense to have irrigation outside the food and agriculture ministry.

    Likewise, transport and railways was one ministry, while it has been broken up into five areas now. Some of them are ridiculously small. Take the ministry for civil aviation. Apart from Air India, Indian Airlines, Airports Authority of India and the DGCA, there is little to it. The first three are companies with full-time managers supposedly managing them. Since the ministry has little policy to make, it busies itself micromanaging the companies. And don’t the ministers for civil aviation just love that? The need for new aircraft and infrastructure have attendant benefits. And what is the need for a ministry of information and broadcasting when that means little more than Akashvani and Doordarshan? Mercifully, there is little by way purchases in I&B.

    By now it should be quite apparent that the 91st Amendment is not good enough as it just does not address the problem. We now need a 92nd Amendment that will marginally change Article 74(1) of the Constitution to read “there will be a council of ministers consisting of the ministers for home affairs, defence, foreign relations, agriculture ….” Article 75(1), that makes it incumbent for the President to appoint ministers on the advice of the Prime Minister, remaining as it is then makes the choice of the ministers entirely his or hers. While we are at it, we might want to look at Article 75(5) afresh and consider the merit of eliminating the stipulation of getting elected to either House of Parliament or legislatures. In this manner we could encourage Prime Ministers and chief ministers to induct professional and competent persons rather than be limited to professional politicians.

    But will the subject of a smaller and more functional government ever merit the politicians’ attention?

    The author is a Trustee and Distinguished Fellow at ‘The Peninsula Foundation’. He is a policy analyst and prolific commentator on politics, economics, industry, and security. He specialises on Chinese economy.

    This article was published earlier in Deccan Chronicle.

  • Belt & Road: What are China’s Real Intentions?

    Belt & Road: What are China’s Real Intentions?

    Mohan Guruswamy                                                                                         May 22, 2019/Analysis

    Almost two years after China hosted a well-attended and hugely-touted conference to promote its One Belt, One Road (OBOR) initiative, it held the second summit last month. It is apparent the grand design outlined at the first summit hasn’t quite shaped up as intended. Questions were asked about its real intentions, economic benefits and usurious tendencies.

    The Chinese have begun backtracking a bit. Already, Malaysia has renegotiated the terms of the rail project with a much-reduced outlay, lower interest rates and increased local participation. It may be mentioned that the original deal was signed by paying the disgraced former Malaysian PM Najib Razak a sizeable bribe. Even Pakistan, Beijing’s so-called “all-weather” friend and ally, has begun questioning the terms of the China-Pakistan Economic Corridor (CPEC) after deriving lessons from what happened to Sri Lanka when the birds came home to roost at Hambantota.

    The second edition of the Belt and Road Initiative Summit got under way in Beijing on Thursday last week. It seems that India’s opposition to it might have also been addressed somewhat when the BRI map showing routes rather curiously shows the whole of Jammu and Kashmir and Arunachal Pradesh as part of India. Is this a signal, or just artistic licence? The map even portrayed India as a part of BRI, despite India having boycotted the summit for the second time.

    Typically, many Indian commentators have started seeing meaning in it. Maps be damned, we can see meaning in BRI only when the norms and terms conform to accepted international norms, such as those of lending agencies like the World Bank.

    The BRI is seen as China’s big play to seek world domination. Both the fears and the optimism are unfounded. The BRI is a project meant to very simply get out the Chinese reserves invested in Western banks into investments where these will fetch a much higher rate of return; and to take up the slack from the huge overcapacity problem that plagues the Chinese economy.

    Speaking at the first BRI (then OBOR) conference, President Xi Jinping had announced that Beijing would advance 380 billion yuan ($55 billion) to support it. This was a far cry from the huge figures, sometimes as high as $750 billion to $1 trillion, that were bandied about. Exaggerating the size of the lollipop is an integral aspect of China’s economic diplomacy.

    While economists are generally sceptical about China’s goals and intentions, strategists — mostly the garden-variety Indian military types — have endowed this project with sinister overtones. I was on a television show when a prominent “security analyst” and the anchor raised the issue of the so-called “string of pearls”. To them it seemed that every port or airport where a Chinese company is the contractor had a military purpose. Most of these folks have not progressed beyond Mahan and Mackinder, whose theories were fashioned in a much earlier era when coaling and oil refuelling points were very critical.

    The “string of pearls” is a bogus idea. It was cooked up by consultants working for a company called Booz Allen Hamilton, which was linked to the US department of defence and the Central Intelligence Agency, and was given a lot of traction by some well-known Indian “strategic thinkers”. I was once at a conference where Adm. Dennis Blair, a former US Navy chief and later President Barack Obama’s Director of National Intelligence, was asked about it. He called it a “stupid notion”, and said no one who has run a large navy or held a responsible position in a navy will ever say an oceanside blockade is possible. He explicitly and loudly said to Indian strategists who harped on the “string of pearls” that no navy could encircle a country with just a few ports.

    The question that we need to ponder over a bit is how long will these “ports” survive after any outbreak of hostilities? The Indian Air Force and the Indian Navy have enough airpower at hand to sort them out, and our Navy can effectively blockade hostile ports in the neighbourhood. It may be noted that the IAF has operationalised an airbase in Thanjavur and will fly SU30 MKIs from there. The Navy deploys MiG-29K fighters as well as P-8i Poseidon maritime surveillance and attack aircraft, and has a formidable fleet of combat vessels. We have not been exactly sleeping or need to be overly worried. The same Sri Lanka that once hosted a Chinese Jinn class nuclear submarine ostensibly on a goodwill mission last year turned away a conventional submarine of the PLA Nany wanting to pick up supplies.

    Now to the economics of BRI. There is a reality most of our commentators do not see or understand. By 2013, China had accumulated foreign exchange reserves of about $3.5 trillion. The capital it claims it is prepared to subscribe for the NDB, AIIB and Silk Road Fund would amount to only around seven per cent of its total foreign exchange reserves invested in Western banks. As these China-promoted institutions will provide infrastructure lending rather than grants, the return on capital from these investments could be significantly higher than the returns China gets from its foreign exchange reserves now invested in low-yielding US government bonds. It’s very simple. China needs to get value for its money and also help its demand-starved industries. They have found a typically Chinese solution to it, and are making a virtue out of a necessity.

    Look at it from another angle. The US dollar is also steadily depreciating in the long term against other major currencies. With no interest and with depreciation factored in China’s huge reserves, accumulated by extracting surpluses in its sweatshops, are steadily shrinking in value. The question which Beijing seeks to grapple is this. One way is to put these funds to work in investment-starved countries in Africa and Asia and assures themselves of returns for a long time to come. In some, the birds have come home to roost quite early. The grandiose Hambantota port project in Sri Lanka, which once had the same bunch of Indian “strategic thinkers” in a tizzy, hosts no ships and doesn’t earn very much. China is now pressuring Sri Lanka to service the debt and is seeking to extract some more in lieu of that. Much of the Hambantota investment has been recouped by China via material and labour supplied to complete the project. That’s why one prominent European commentator then called OBOR “One Belt, One Road and One Trap”.

    Like Sri Lanka, some other intended beneficiaries have now begun to ask questions about the utility and intentions of OBOR. Pakistan’s Dawn newspaper has said: “But the main thrust of the plan actually lies in agriculture, contrary to the image of CPEC as a massive industrial and transport undertaking, involving power plants and highways. The plan acquires its greatest specificity, and lays out the largest number of projects and plans for their facilitation, in agriculture.” It then questions the benefits that will arise from linking mostly dry and barren Xinjiang, and in particular the predominantly Turkestani Muslim Kashgar prefecture with its restive four million people, to an increasingly water-starved and already much troubled Pakistan. Once when a Pakistani interlocutor at a Track-2 session asked me what then would be the economic gains to Pakistan, I replied they could sell tea and samosas to the traffic!

    Much is being made about the overland link between China and Europe by rail and road links. Most commentators seem to miss that the Trans-Siberian Railway line from Vladivostok to Moscow is almost a hundred years old. Its capacity can be beefed up. Yet overland freight costs will always be much more expensive than sea freight costs. Business is about cutting costs and taking the least expensive option. No one with common sense will prefer to shift by land what can be shipped. Others make much of the so-called Malacca dilemma. The Arctic route is now opening up, and the real Malacca dilemma soon will be the rapid decrease in freighters through it. There is always the option of a canal for freighters across the Kra Isthmus, a project that will bring China and Japan much closer to India.

    Mohan Guruswamy is a Trustee and a Distinguished Fellow of TPF. He is a prolific commentator on economic and security issues, and specialises on China.

    This article was published earlier in Deccan Chronicle.

  • New challenges of global terrorism

    New challenges of global terrorism

    G Parthasarathy                                                                                                  May 23, 2019/Opinion

    The people of Sri Lanka have shown courage, wisdom and resilience in recovering from the traumatic effects of the country’s brutal ethnic conflict between 1983 and 2010. An estimated 47,000 Tamil civilians, 27,000 LTTE members, 50,000 Sinhala civilians, 23,790 Sri Lankan soldiers and 1,500 members of the Indian Peace Keeping Force laid down their lives, during the conflict.

    he Sri Lankan ethnic conflict, however, did not affect the lives of “Indian Tamils” in Southern Sri Lanka, whose ancestors had migrated, as plantation workers, during British rule. There have, however, been recent incidents of religious tensions between the Sinhala Buddhist clergy and radicalised elements in the Muslim minority. Sri Lanka’s relatively small Christian minority, which is peaceful and relatively affluent, had steered clear of getting drawn into any ethnic conflict.

    In these circumstances, the world was shocked to learn that in the midst of holy Easter Sunday church services on April 21, churches in Colombo, Negombo and even the eastern port of Tamil dominated Batticaloa, were hit by bomb explosions.

    Three hotels housing a large number of western tourists in Colombo were also targeted. As many as 253 innocent people perished in the carnage.

    The “Islamic State of Iraq and Syria” (ISIS) soon claimed responsibility for the attack, contradicting President Trump’s claims that the terrorist outfit had been “100 per cent” crushed in Syria. It soon emerged that the mastermind behind the blasts was a rabidly fundamentalist Sri Lankan Tamil, Maulvi Mohammad Zahran Hashim, who was from the town of Kathankudy, in Sri Lanka’s Tamil dominated eastern province.

    Indian intelligence agencies had provided timely warnings to the Sri Lankan Government about an impending terrorist strike by the ISIS. These warnings were not seriously taken note of by the Sri Lanka Government. It is, however, imperative that India keeps in touch discreetly with the Sri Lankan Government. We are evidently seeing the beginnings of long-term internal and regional problems and challenges, as ISIS members disperse and regroup, after being ousted from Iraq and Syria, like Al Qaeda and the Taliban did, after American militarily intervention in Afghanistan.

    As the ISIS targets in Sri Lanka were the country’s peaceful Christian community and western (Christian) tourists, the bomb attacks sent ripples across the West, as the attacks came soon after the massacre of Muslims in New Zealand, during their Sunday prayers.

    Radicalisation drive

    Sri Lanka’s Muslim community, which has done well economically in the Island, has lived in peace with both Buddhist Sinhalas and Hindu Tamils. Recent studies, however, indicate that some years before the bombings, sections of Tamil Muslims from the eastern province were getting radicalised in Saudi Arabia and other Gulf Arab countries.

    Zahran Hashim was one of those so influenced by radical Islamist practices and beliefs. Cutting across ethnic differences, Hashim made common cause with Sinhala Muslims, including two sons of a Muslim business tycoon in Colombo, who had been deeply influenced by the ISIS. Both the sons died in suicide bomb blasts, even as the wife of another bomber detonated explosives in a suicide bombing the same day, resulting in the deaths of three police personnel.

    The Sri Lanka bomb blasts were thus executed by young radicalised Sri Lankan Muslims, cutting across the ethnic divide. Moreover, there are now signs that an estimated 75-100 Indian Muslims, who were with the ISIS in Syria, have dispersed and chosen escape routes, including through Afghanistan and Pakistan. Hashim has also reportedly established close institutional links with a counterpart group in Coimbatore and with people in other parts of Tamil Nadu and Kerala.

    There are now indications that after being forced out of Iraq and Syria, ISIS fighters have now dispersed across Asia, Africa and even to parts of Europe. While the Osama bin Laden-led Al Qaeda made it clear that its struggle was against “Jews and Crusaders,” the ISIS targets all non-Muslims, as was evident from its brutal killings of Indians in Iraq. Moreover, the Al Qaeda operated primarily out of Afghanistan and Pakistan, apart from select Arab countries. Al Qaeda’s leadership was predominantly Arab. It had very few members from other parts of the world.

    The ISIS poses a much more serious challenge to India than the Al Qaeda ever did, primarily because it has recruited its fighters from countries across Europe, Asia and Africa. President George Bush praised India because not a single Indian joined or backed Al Qaeda. But, things are different with ISIS, which regards India as a part of the “Islamic State of Khorasan”. Over 100 Indians are estimated to have joined the ISIS.

    Extending its reach

    The reach of ISIS across India is evident from its links with extremists in Kashmir, apart from those established in the recent past, in Tamil Nadu and Kerala. Radicalisation in our southern States poses new and serious security challenges. ISIS also acknowledges its links with associates, across India’s maritime frontiers in Malaysia, Thailand, the Philippines, Myanmar, Indonesia, Maldives, Saudi Arabia and the UAE. It also has a growing presence in Afghanistan and Pakistan.

    India will also have to take note of the distinct possibility of ISIS attempting to take advantage of tensions arising out of the Rohingya refugee crisis. A senior Myanmar official recently revealed that even as ISIS was losing influence in Iraq and Syria, its supporters were moving into Myanmar’s Rakhine State, where Rohingyas reside. Many Rohingya refugees, now in Bangladesh, could well make common cause with ISIS and with members of Pakistani backed militant outfits like the Jamat-ul-Mujahideen, to destabilise the situation along the common borders of India, Bangladesh and Myanmar. Pakistan has had an abiding interest in destabilising the Sheikh Hasina-led Government in Bangladesh.

    Apart from having to deal with continuing Pakistan sponsored terrorism, India will now also have to keep a watch on challenges that would likely arise from the ISIS, with its emerging presence in the southern States. Like in Sri Lanka, ISIS activities could target selected sections of the population in India, while seeking to radicalise them. They will pose a challenge to internal security in India. Finally, Pakistan could be expected to use the challenges posed by ISIS, to absolve itself of responsibility on actions of its trained jihadis, on Indian soil and in Bangladesh. These issues will hopefully receive careful attention after the general elections.

    The writer is a former High Commissioner to Pakistan. He is a Trustee and Visiting Distinguished fellow of TPF.

    This article was published earlier in The Hindu: BusinessLine.

    Image Credit-Getty through Vox.

  • Chinese Lesson: Paying the Price for Uprightness

    Chinese Lesson: Paying the Price for Uprightness

    Mohan Guruswamy                                                                                        May 22, 2019/Op-Ed

    World’s largest electoral exercise, in the largest democracy – India, concluded on May 19th. The counting and results are awaited in a few hours from now. This elction has been the most acrimonious so far in Independent India’s history. Given the endemic corruption and the corrosive hyper-nationalism around the world today, the importance of honesty, integrity, and uprightness in public life is in stark focus. The French Revolution produced Maximilien Robespierre, ‘the Incorruptible’ whose intolerance for corruption brought in the infamous guillotine. Mohan Guruswamy goes down Chinese history to highlight the importance of uprightness, whatever the price maybe.

    Recently I had a visitor from Hainan, China, Jiang Zhongqiang. Jiang is from the South China Maritime Research Centre, and has been commissioned to write a book about the Congress Party. I told him that to understand the inner workings of the party he would be better off first studying the inner workings of the Ming court. When asked to elaborate I told him about Hai Rui (1514-1587), the honest bureaucrat from Hainan who is buried in the provincial capital Haikou in a nondescript grave. We also spoke about the writer Lu Xun (1881-1936), who like Hai Rui paid a heavy price for his uprightness.

    Hai Rui was a scholar-official of the Ming dynasty. He is remembered as a model of honesty and integrity in office. A play based on his career, Hai Rui Dismissed from Office, by Wu Han gained political significance in 1961 after the Peking Opera staged it. Initially Mao applauded the play, but when people started seeing in it as an allegory of him and Marshal Peng Dehuai, the Great Helmsman changed his mind. Peng himself agreed with this interpretation, and stated: “I want to be a Hai Rui!” in a 1962 letter to Mao requesting his return to politics. Wu Han himself was purged for his troubles and died in prison in 1969.

    Hai Rui was a scholar-bureaucrat. Like many educated Chinese he joined the bureaucracy and soon gained a reputation for his morality, scrupulous honesty and fairness. This won him widespread popular support, evinced among other things by his being enshrined while alive; but he also made many enemies in the bureaucracy. Nevertheless, he was called to the capital Peking and promoted to the position of secretary of the ministry of revenue. In 1565, he submitted a memorial strongly criticising Emperor Jialing for the neglect of his duties and bringing disaster to the country, for which he was sentenced to death in 1566. He was released after the emperor died in early 1567. Hai Rui was reappointed under the Emperor Longqing, but soon forced to resign in 1570 after complaints were made over his overzealous handling of land-tenure issues.

    He is not particularly celebrated in China any more, which is not surprising given the open corruption that flourishes there. Like in India now, wealth is more celebrated than character in China. When I visited Haikou, Hainan, in 2013, I asked my hosts to be taken to Hai Rui’s grave. My hosts were surprised. Perhaps he makes the Communist mandarins feel uncomfortable?

    Interestingly enough, Hai Rui had an Indian connection. He was descended from a native of Guangzhou named Hai Da-er (Haidar), and his mother was also from a Muslim (Hui) family that originated from India. Hai Rui himself was however known primarily as a Neo-Confucian and never discussed Islam in his Confucian works.

    In April 2015, I drove out from Shanghai to Shaoxing in Zhejiang province and crossed over the 36-km long bridge across the Hangzhou Bay from Jiaxing to Cixi. Cixi incidentally is the birthplace of KMT Generalissimo Chiang Kai Shek. The next town Shaoxing is the birthplace of Zhou Enlai, Mao Zedong’s devoted acolyte. But Shaoxing is a much-visited tourist destination these days because it is the hometown of the venerated writer Lu Xun, commonly considered the greatest Chinese writer of the 20th century. Lu Xun was also an important critic known for his sharp and unique essays on the historical traditions and modern conditions of China. Lu Xun was the pen name of Zhou Zorn, born in a wealthy Shaoxing family. This home of the family Zhou is a much-visited tourist site, not only for its simple elegance and for the unique peep it offers into late 19th century upper class family life in China, but also because it is the locale for several of Lu Xun’s stories.

    His official biography in the brochure reads: “Lu Xun left his hometown in 1899 and attended a mining school in Nanjing; there he developed an interest in Darwin’s theory of evolution, which became an important influence in his work. Chinese intellectuals of the time understood Darwin’s theory to encourage the struggle for social reform, to privilege the new and fresh over the old and traditional. In 1902 he traveled to Japan to study Japanese and medical science, and while there he became a supporter of the Chinese revolutionaries who gathered there. In 1903, he began to write articles for radical magazines edited by Chinese students in Japan. In 1909 he published, with his younger brother Zhou Zuoren, a two-volume translation of 19th-century European stories, in the hope that it would inspire readers to revolution, but the project failed to attract interest. Disillusioned, Lu Xun returned to China later that year.”

    Lu Xun was a contemporary of Munshi Premchand (1880-1936) and like him excelled in short story writing. He began writing full time in 1918 and his first published fiction was the now-famous short story Kuangren riji (“Diary of a Madman”). Like the Russian realist Nikolay Gogol’s tale of the same title, the story is a condemnation of traditional Confucian culture, which the madman narrator sees as a “man-eating” society. It was considered a tour de force that attracted immediate attention and helped gain acceptance for the short-story form as an effective literary vehicle.

    Like Premchand, Lu Xun’s stories were telling commentaries of the times usually told with a sardonic sense of humor. In 1930 Lu Xun stopped writing fiction and devoted himself to writing satiric critical essays, which he used as a form of political protest. The same year he became the nominal leader of the League of Left-Wing Writers. Although he himself refused to join the Chinese Communist Party, he considered himself a tongluren (fellow traveler), recruiting many writers and countrymen to the Communist cause through his Chinese translations of Marxist literary theories, as well as through his own political writing.

    During the last several years of Lu Xun’s life, the KMT government prohibited the publication of most of his work, so he published the majority of his new articles under various pseudonyms. He criticised the Shanghai Communist literary circles for their embrace of propaganda, and he was politically attacked by many of their members. In 1934 he described his political position as hengzhan or “horizontal stand”, meaning he was struggling simultaneously against both the right and the left, against both cultural conservatism and mechanical evolution. Hengzhan, the most important idea in Lu Xun’s later thought, indicates the complex and tragic predicament of an intellectual in modern society.

    The celebration of the life and works of Lu Xun leaves its imprint all over the lovely town of Shaoxing. Lu Xun rather than Zhou Enlai is the popular and loved son of Shaoxing. All over Shaoxing you will see not only statues of Lu Xun but also statues of characters from some of his more celebrated works. Even Lu Xun’s favourite restaurant is a popular eatery and it is very difficult to get a place. Our party of four got a courtyard table after our local hosts told the owner that two Indians (Ambassador T.C.A. Rangachari and myself) had come across the globe just to pay homage to Lu Xun. The food was worth every word of praise Lu Xun may have had for it. I had a dish of braised mushrooms with pork and rice, which was a favorite of Lu Xun’s.

    I was at Ghalib’s haveli at Ballimaran some months ago. Ghalib, like Premchand many decades later, was the greatest commentator of the period. The haveli where he lived the last nine years of his life is a sorry mess. It reflects nothing of his immense popularity and greatness. As a chronicler commented: “Ghalib’s last home lost its original flourishes of frescoes, alcoves and archways, following several sub-divisions and additions over the years. Reduced to a dimly lit gallery, a small verandah and a claustrophobic courtyard, it was a coal store at some time in the past. Ghalib would have chuckled.” Poor Premchand had to wait till 2016 to get a research centre named after him in Varanasi. I am sure both would have said something pithy about how we celebrate our scholars.

    The writer, a policy analyst studying economic and security issues, held senior positions in government and industry. He also specialises in the Chinese economy. He is a Trustee and Distinguished Fellow of TPF.

    This article was published earlier in Deccan Chronicle.

    Image Credit – PublicDomainPioctures from Pixabay.

  • How the newly inducted IAF Chinook heavy-lift helicopters provide huge versatility in operations

    How the newly inducted IAF Chinook heavy-lift helicopters provide huge versatility in operations

    M Matheswaran                                                                                                 May 22, 2019/Opinion

    The Indian Air Force inducted the first batch of four Boeing C-47 F(I) Chinook helicopters last month into its inventory. These are part of the order for fifteen heavy lift helicopters. With a payload capability of 10 tonnes and a significantly good high altitude performance, the Chinooks fill a long-felt gap in IAF’s heavy lift helicopter capability. For long the IAF had depended solely on its small fleet of Russian built Mi-26 helicopter, which is still the world’s largest and heaviest payload helicopter. The Mi-26, with an enormous payload capability of 20 tonnes, had provided yeoman service for more than two decades.

    Starting with a fleet of four aircraft, the Mi-26 has played extensive role in meeting major airlift requirements of material, machinery, and men, for the military and civil administration in the Himalayan border regions.With one aircraft having crashed few years ago, the surviving fleet had been hampered by maintenance and technical support problems, virtually bringing to halt the heavy heli-lift capability of the IAF. Besides, increasing emphasis on infrastructure build-up in the border regions has highlighted the importance of heli-lift capabilities for both the IAF and the Indian Army. This is what prompted the IAF to look out for building and enhancing its heli-lift capabilities in the heavy-segment.

    India’s borderlands, dominated by the mighty Himalayan ranges, are unique, treacherous, and the most demanding in the world. The need to operate at altitudes higher than 20000 ft on regular basis is unique to India, and is a challenge to most helicopters designed in the West and Russia. Operations in Indian environment puts gruelling demands on these helicopters. High altitude performance in other parts of the world is at less than 20000ft, in fact, it would average between 5000 and 10000 ft, with exceptions at 15000 ft. In India, 20000 ft operations would be routine in the Himalayan stretches and valleys all across our nearly 4000 km long border in the north and north-west. High altitude operations put severe demands on the engine, has a drastic reduction in effective payload, and has adverse impact on total technical life. These will need to be addressed by appropriate technical enhancements that are fairly expensive as well.

    Indian MOD signed the contract with M/s Boeing in Sep 2015 for supply of 15 CH-47F(I) Chinook Helicopters. The contract is for USD 1.1 billion, with an option clause for further seven aircraft. All 15 aircraft are planned to be supplied before March, 2020. It is almost certain that the option clause would be exercised. The first aircraft was handed over in a ceremony at the manufacturer’s production facility in Philadelphia on Feb 1 st , and the first batch of four were shipped out to Mundra Port in Gujarat. The four were then assembled and integrated into fully operational helicopters at the IAF base in Chandigarh and inducted on the 25 th March. Some of the specialist systems, self-protection systems and EW equipment are contracted through the FMS (Foreign Military Sales) procedure.

    While the payload capability is only half that of the Mi-26 helicopter, the Chinook provides huge versatility in operations. The IAF version is the CH-47 F(I), which is the latest and advanced version of the Chinook, designed more than 50 years ago in 1962. The IAF aircraft is upgraded with new generation avionics and flight control systems that make the aircraft capable of very precise and versatile operations during day and night. The Chinook’s twin-rotor design gives it good agility and stability in high altitude operations. Its advanced mission computer and the DAFCS (Digital Automatic Flight Control System) allows the pilot to feed in the complete mission profile and fly automatically and with hover precision in one foot increments vertically and laterally. The CH-47 F(I) is an advanced multi mission helicopter with the true multi-role, vertical-lift capability. It contains a fully integrated, digital cockpit management system, Common Aviation Architecture Cockpit and advanced cargo-handling capabilities that complement the aircraft’s mission performance and handling characteristics. Its primary role will be for transportation of troops, artillery, equipment, and fuel. The army is particularly keen on the Chinook heavy heli-lift capability for transportation and deployment of its recently procured M-777 Ultra-Light howitzer artillery guns in the Himalayan border regions with China.

    As opposed to the small fleet of three Mi-26 helicopters, the larger fleet size of the CH- 47 F(I) would provide the IAF immense flexibility and availability of aircraft for a variety of tasks. It will provide a boost to the construction of infrastructure and border road projects, long overdue. Border Roads Organisation would get a fillip to its long-delayed road construction projects in the north-east. Our continued requirements of aerial maintenance in remote regions will be better served with this new capability, as also for critical needs of HADR operations, in missions for transportation of relief supplies, and evacuation of refugees. The IAF plans to deploy the two squadrons, one in the Western sector in Himachal Pradesh and adjoining Himalayan regions, and the other in the East sector in Assam/Arunachal Pradesh.

    The Chinook acquisition was also accompanied by acquisition of the Apache attack helicopter, also from Boeing. Both contracts, worth together over USD 3.5 billion, were signed on the same day on 28 Sep 2015. Both are also a combination of DCS (Direct Commercial Sales) and FMS (Foreign Military Sales) processes. The two inductions have followed a series of procurements from the USA, mostly through the FMS route. Having started with the first major defence deal in 2008, the Indo-USA defence business is likely to touch a whopping USD 18 billion by the end of 2019. Most of these acquisitions are through FMS and are virtually replacing the earlier Russian fleets: Apache replacing the Mi-35, Chinook replacing Mi-26, Sikorsky MH-60 Romeo replacing the Kamov in the Navy, with the likelihood of 110 NMRH to follow; this is a sort of indirect CAATSA in play.
    It is important for India to realise that while many of these acquisitions have given significant teeth to Indian operational capability, in terms of business it has been huge business to the US companies with very little to show for India in 3 terms of Technology transfer or industrial gain in terms of manufacture or co-design and co- development.

    The CAG report number 3 of 2019 comes down heavily on these acquisitions. It castigates the MOD and the IAF for procedural lapses, long drawn out acquisition processes, and more importantly of having skewed the QRs in such a way that only Chinook and Apache would have been successful. That’s a serious indictment. However, India will do well to remember that major procurements like the Apache and the Chinook at huge costs, while meeting the IAF’s operational requirements, should also be leveraged to benefit India’s larger strategic interests of technology acquisition, industrial capability, global partnerships, and of course, strengthening US-India strategic partnership. It needs to be a win-win for both.

    The author is retired Air Marshal and former Deputy Chief of Integrated Defence Staff. He is the founding Chairman and President of The Peninsula Foundation, Chennai. Views expressed are personal. 

    This article was published earlier in Financial Express.

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  • India Elections 2019: Electoral Bonds Scheme Hinders Effective Policymaking

    India Elections 2019: Electoral Bonds Scheme Hinders Effective Policymaking

    Renuka Paul                                                                                                      May 22, 2019/Analysis

    The legality of electoral bonds was recently upheld by the Supreme Court after the Association for Democratic Reforms (ADR), Common Cause, and CPI(M) filed a petition challenging its constitutionality, seeking either a stay on the issuance of electoral bonds or to make names of the donors public as interim relief. However, the Court did direct the political parties to submit all details pertaining to electoral bonds to the Election Commission of India (ECI) in “sealed covers”. In 2017, as part of political funding reforms, the Centre introduced the Electoral Bonds Scheme by amending the Finance Act, Income Tax Act, RBI Act and Representation of People Act. Through this scheme, donors can make contributions to political parties by purchasing bonds from designated branches of the State Bank of India (SBI) in denominations ranging from Rs 1000 to Rs 1 crore.  Using banks as intermediaries, donors transfer funds to political parties. The latter can redeem the bonds only in their registered accounts within 15 days, before validity expires.

    The Government of India announced the scheme in January 2018, claiming that it will “cleanse the system of political funding in India”. The Centre stated that political parties incur large scale expenditures in terms of staff salaries, election campaigns, travelling expenses etc., often funded through cash donations from sympathisers. Conventional funding practice has been characterised by an undisclosed quantum of money channelled to political parties from unidentifiable sources. To change this status quo, the National Democratic Alliance (NDA) set the limit on cash donations at Rs 2000, beyond which funding of parties had to be done through cheques and other financial instruments, in keeping with the government’s digitisation drive. Furthermore, tax deductions were introduced for funders utilizing cheques and online payments for party donations. However, the State noted that since this required disclosure of donor identities, these features were not widely accepted, as they “invited consequences from political opponents”. In order to overcome this challenge, electoral bonds were introduced to ensure clean money and substantial transparency, wherein funders could remain anonymous. It was justified that while donors could remain unidentified and were not required to reveal the parties they supported, political parties would have to disclose the amount of funds received through electoral bonds to ECI.

    According to VS Sampanth, the former Chief Election Commissioner, electoral bonds have made political funding more anonymous than ever. He claims that these bonds do not meet the basic requirements of transparency and disclosure, and ease corporate funding. In other words, corporates can now financially back political parties without leaving a trace, thereby influencing policy without public scrutiny. This view was shared by the Association for Democratic Reforms (ADR), which took a contrary position from the Centre, opposing the scheme and arguing in Court that it has “opened the floodgates to unlimited corporate donations to political parties and anonymous financing by Indian as well as foreign companies, which can have serious repercussions on the Indian democracy”. An inquiry under the RTI Act revealed that 99.8 percent of the electoral bonds between March 2018 and January 24, 2019 were in denominations of Rs.10 lakhs to Rs 1 crore. Though the government denied corporate takeover, bonds being of the highest denominations indicate that it is not common citizens but corporates purchasing these bonds.

    Previously, in March 2017, the Companies Act was amended to remove the cap on political funding, thereby allowing companies to donate more than 7.5 percent of their average net profits. It is also no longer required that the company be established for at least 3 years in order to make political donations, which may pave way for funding through shell companies. Further, the mandate of disclosing the identities of the beneficiary parties has also been removed. Therefore, currently, while the amount of donations is recorded in the books of accounts, corporates can unlimitedly and anonymously fund political parties legally. It remains a plausible option for even those companies that are operating at a loss. This alarming trend will strengthen the nexus between corporates and politics, leading to private corporate interests taking precedence over the public’s needs with regard to policymaking. Without funding tracks, it would be difficult for the Ethics Committee of Parliament, CAG, and the ECI to scrutinise and raise flags in the case of such incidents. Furthermore, in March 2018, the Foreign Contributions (Regulation) Act was amended to remove the ban on foreign corporations from funding political parties, retrospectively from 1976. By expanding the definition of foreign entities, it is now possible for parties to accept donations from overseas through “Indian subsidiaries” of foreign companies. In addition to making the Indian polity vulnerable to foreign influence and pressure, it has also made it possible to overturn the 2014 Delhi Court judgement that found the BJP and Congress guilty of violating the Foreign Contribution Act (FCRA) by accepting donations from Vedanta, a London-based multinational company. Interestingly, these amendments were introduced as money bills that bypassed the Rajya Sabha (NDA has a clear majority in the Lok Sabha).

    Many argue that the recent array of political reforms favours the ruling party. These claims are strengthened by data that points to lopsided electoral funding. A study of income tax returns filed by parties for the period of March 2018 noted that the BJP was the biggest beneficiary of this scheme, accruing over Rs. 210 crores, i.e. 95 percent of all electoral bonds. Oppositions parties, especially regional parties, allege the Electoral Bonds Scheme to be inherently discriminatory. According to the scheme, a donor is required to submit KYC forms with the SBI branch to successfully purchase electoral bonds. The SBI reports to the Reserve Bank of India (RBI), and both banks report to the Ministry of Finance, which results in the ruling party ascertaining the identity of donors (if desired). Opposition parties claim that the ruling party registering the identity of the former’s donors while maintaining the autonomy of their own is unfair. They argue that funding mechanisms through electoral bonds is biased against them, and also provides the ruling party with the opportunity to dissuade or retaliate against their sympathizers. Overall, dissidents of the scheme contend that the Electoral Bonds Scheme threatens equality in political financing.

    India’s political landscape is marked by opaque transactions and funding mechanisms that hinder public scrutiny, resulting in poor legislations favouring prime political funders. Since the early 1980s, multiple reports and committees such as the Goswami Committee on Electoral Reforms, Law Commission Report on Electoral Reforms, Vohra Committee on State Funding of Elections, etc. were formed to address these issues. In general, the suggested recommendations include capping of election expenditures, political contributions and per-candidate expenditures.

    Studies have revealed that money power is used to unduly influence voters through freebies, raising candidates’ expenditures. With financial superiority translating to electoral advantage, parties turn towards corporate donations, resulting in policy capture. Unless expenditure limits are introduced and penalties strongly imposed, the system will remain murky. Additionally, doing so will also better financial equality among candidates hailing from different classes.

    Many have called for public funding of elections through a centrally maintained Election Fund. However, in India, channelling public resources towards elections might adversely affect budgets for social sectors. Moreover, in the absence of a limit on the number of candidates, some might contest elections in order to avail state funds. The National Commission to Review the Working of Constitution 2001 held that state funding of elections must be preceded by regulation of political parties and financial reforms in order for it to be successful. Unfortunately, the recommendations have not led to legislative action.

    For effective political reforms to occur, maintenance of donor records- irrespective of the amounts- is necessary. In the absence of a cap on political contributions, this would enable the electorate to make informed political choices, keeping in mind lobbying and policy capture. The first step towards greater transparency and accountability would be to bring political parties under the RTI Act. However, the evident lack of political will remains a problem. Considering this, the immediate solution would be to strengthen the ECI by extending legal rights and shielding it from political influence.

    Renuka Paul is a Research Analyst with TPF.

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