17 November 2012


It is 50 years since the border conflict with China, and the nation must be told the truth in its own interests so that it is prepared for a settlement. The truth about how a boundary problem was, in the first place, allowed to assume the proportions of a dispute and, in the next, how an unnecessary dispute was allowed to trigger an unnecessary war.

August 1963, Tezpur Hospital in North-East Frontier Agency, or NEFA: A word of comfort from Prime Minister Jawaharlal Nehru for a jawan wounded in the 1962 war.

“The Ottoman revival is good for the national ego and has captured the psyche of the country at this moment, when Turkey wants to be a great power. But, it terrifies me because too much national ego is not a good thing. Films like Conquest 1453 are engaging in cultural revisionism and glorifying the past without looking at history in a critical way,” Melis Behlil, a film studies professor at Kadir Has University in Istanbul, said. In 1453, the 21-year-old Sultan Mehmet II conquered the historic city of Constantinople, now Istanbul ( International Herald Tribune; November 1, 2012).

India has had a surfeit of such films, especially in the last quarter century; Ramayana, serialised on Doordarshan, for example. But it has no tradition of any introspection worth the name. The outpourings on the 50th anniversary of the China-India war, which erupted on October 20, 1962, should have prodded some reflection in the same spirit as Melis Behlil’s remarks. But hardly anyone took that trouble. Instead, we were treated to familiar themes such as the omission to use air power, tactical and strategic mistakes and the roles of villains of note.

Professor Wang Gungwa of the National University of Singapore said in New Delhi on December 24, 2010, apropos that war: “Most in China don’t even think about it. Still others don’t know about 1962 and what happened. Most people in China think it was misunderstanding between the leaders.”

This is a bit facile. The Chinese recall to this day the war with Japan which took place much earlier. India’s recall of the war is understandable. It suffered a humiliating defeat and lost territory and prestige; witnessed in its aftermath the Sino-Pak entente of great consequence; felt frustrated at the decline in the relations with China and the deadlock on the boundary dispute; and is baffled as to how all this has happened.

Farthest from the minds of most is any thought of mistakes on India’s part. What was most pronounced was a feeling of self-righteousness. The outpourings produced hardly an ideas of worth. They revealed the mindset of the Indian elite. Patrick Tyler of The New York Times has just produced a fascinating study of the military elite that runs Israel and why it cannot make peace. It is aptly entitled Fortress America. The Indian elite shares this militaristic outlook with two other countries it dearly loves, the United States and Israel.

Not surprisingly, the military aspect dominated the discourse on the war of October 1962. The diplomatic background was ignored. A mass of material has appeared on decision-making in China before October 1962. It is ignored. There is not the faintest suggestion of Indian lapses. Such an outlook bodes ill for the future. But it has been prevalent since Independence as part of nationalistic fervour. In 1968, shortly after the Rann of Kutch Award, this writer was driving down from Delhi to Faridabad for a Quaker seminar, in the stimulating company of Prof. Hans J. Morgenthau. A remark he made sums up the national mood: “Yours is the only country in the world which wins 90 per cent of its case before an international tribunal and calls it defeat.” India broke two international agreements on the cession of Beru Bari; the Nehru-Noon Agreement of September 10, 1958, and the Indira Gandhi-Sheikh Mujibur Rehman Agreement of May 16, 1974. The matter was finalised in a messy deal after prolonged litigation. Beru Bari is about the size of a football field.

At Amar Jawan Jyoti on October 20, when the defence forces for the first time officially honoured its 1962 heroes.

The border dispute and some questions

At the root of the rift between India and China was the boundary question. It is high time we asked ourselves some soul-searching questions now. Had China any legitimate interests as well besides our own, and were they not reconcilable with India’s interests? What were China’s motivation and objectives in launching the military offensive on October 20, 1962? What were India’s objectives in launching “the Forward Policy” in 1961 and to what extent, if any, was it responsible for China’s moves in 1962? Was the war avoidable? Can we settle the boundary dispute without making any concessions to China? If so, what could these be? Lastly, can any Indian government settle the dispute and push it through Parliament? On present form the Indian state is simply dysfunctional in dealing with matters of this kind, whether the boundary dispute or the far more emotive one, Kashmir; not even the modest 4-Point formula. Well before it had Parliament paralysed, the Bharatiya Janata Party (BJP) had assumed a wrecker’s stance. It would oppose any settlement by any other party in power. While in power, the BJP did not have a single constructive idea to offer. But the Congress is none too prepared, either.

The record of Jawaharlal Nehru, as Prime Minister and the main, if not, indeed, the sole architect of India’s foreign policy, must be held to account. It is, however, only fair to emphasise that on China the entire opposition adopted a rancorous and chauvinistic role—the Socialists, the Swatantra Party and the Jana Sangh. So did the press. The Communist Party of India (CPI), then united, was the solitary exception; but it was suspect because China was a Communist state. For the rest, these men vied with one another in advocating mindlessly a hard line on the boundary question—R.M. Lohia, Ashok Mehta, Nath Pai, J.B. Kripalani, M.R. Masani, N.G. Ranga and Atal Bihari Vajpayee. Their culpability is lessened a little by the fact that Nehru controlled the flow of information. Until 1963, no scholar went to the National Archives of India to seek the historical truth.

It is a besetting flaw in Indian thinking not to recognise the legitimacy of any interest other than its own. Reconciliation of conflicting interests, the prime object of diplomacy, becomes difficult if not impossible. Of a piece with this is the fostering of myth and the spread of what can only be called disinformation, at times downright lies. The more sensitive the issue, the more assiduous the effort. The myths of Nehru’s “idealism” and “romanticism” and China’s “betrayal” of this devoted friend fall in this category.

The stark truth is that India became independent in 1947 with the legacy of a boundary problem, and Nehru and his principal advisers were fully aware of that. The boundary dispute did not arise all of a sudden in 1958-59 to hit them in their faces, as was made out later. The boundary awareness was confined to the eastern sector, the McMahon Line, where India has a strong case. It did not extend to the western sector, the Aksai Chin in the Ladakh province of Jammu and Kashmir, through which China built the Xinjiang-Tibet highway. India’s stand on this sector as also on the part west of the Karakoram Pass has not a leg to stand on.

Perfectly reconcilable interests

It is a bitter irony that the boundary dispute is one of the rare disputes in which the rival, non-negotiable, vital interests of each side are perfectly reconcilable. India has the McMahon Line; China has the road. A heavy responsibility rests on those who allowed a boundary problem to assume the proportions of a dispute in the first place and, in the next, allowed an unnecessary dispute to trigger an unnecessary war.

Unless there is a thorough retrospect, we shall continue to drift mindlessly as before. No retrospect can be more instructive than one which is painful. We owe a debt to Ananth Krishnan for his excellent reportage in The Hindu (October 22, 25 and 26, 2012) on the recently published records in China. One hopes we get a fuller record before long. His reportage goes beyond the past. It is of current relevance— Jiefang Daily or Liberation Daily, which has close ties to the Communist Party in Shanghai, published on October 25 an important article by Wu Yongnian, a researcher at the Shanghai Institute of International Affairs, which said that China would not accept the Line of Actual Control (LOAC) as settlement of the boundary dispute. Nor would India. The talks have reached an impasse. One hates to say that, but as far back as 2000, in the heyday of the BJP regime, this writer told a high official concerned with the talks that China would not even demarcate the LOAC, let alone accept it as an agreed boundary. He was taken aback because the BJP government had invested a lot in this project. The writer’s assessment was based on documents plus a few soundings. It is not that government alone which had a tin ear on Chinese hints and a Nelson’s eye on ominous signals. What all have shared is suppression of doubt.

Tawang, October 20, 2012: Bunkers used during the 1962 war, at the Jaswantgarh War Memorial.

The Government of India led by Jawaharlal Nehru confidently walked into this tragic conflict with its eyes wide open. To this day few are willing to accept that it sinned against the light, sinned repeatedly and resorted to a cover-up. Fewer still are willing to accept that China had a legitimate grievance on counts more than one. George F. Kennan wisely said, “When the ambivalence of one’s virtue is recognised, the total iniquity of one’s opponent is also irreparably impaired” ( Russia and the West; Mentor Books, 1960; page 332).

Someday at some time India will have to settle the dispute with China. Independent India had unfinished business on its entire northern frontier. Three trijunctions are yet to be defined. A settlement of the border question is best pursued for its own sake, for the gains of an agreed, defined border which marks the completion of the unfinished business of demarcating India’s land frontiers. Gaps can be dangerous. The boundary agreement between India and Burma (Myanmar), signed in Rangoon (Yangon) on March 10, 1967, defines the entire boundary in detail in Article 1, only to qualify that “the exact location of which Northern extremity will remain provisional pending its final determination”. The trijunction of the frontiers of India, Burma and China cannot be fixed except by the agreement of all three. Likewise, the China-Nepal border protocol, signed on November 20, 1979, leaves the two trijunctions in Sikkim and the Pithoragarh district in undivided Uttar Pradesh vague. They were also excluded from the physical survey undertaken by Nepal and China ( The Times of India, January 12, 1980). On March 5, 1981, P.V. Narasimha Rao, then Minister for External Affairs, asserted in the Lok Sabha that “there is no dispute between the two countries [India and Nepal] about the boundary”.

China has evolved a certain procedure in its border settlements. There is, first, an agreement defining the frontier and resolving the basic differences (Burma, January 28, 1960; Nepal, March 21, 1960; and Pakistan, March 2, 1963). Joint committees are then set up to draw up a boundary treaty, correct maps and conduct surveys. Treaties have been concluded accordingly with Burma (October 1, 1960) and Nepal (October 5, 1961) but without any such preliminaries with Mongolia (March 26, 1963) and Afghanistan (November 22, 1963). The last step is a boundary protocol that records the details of the actual demarcation on the ground. The protocol then forms part of the treaty.

What will the government of the day which settles the boundary dispute tell the people? Those who recycle the garbage of the 1960s prove a sincere commitment to the cause of protection of the environment, but, in this instance, by harming the national interest. The nation must be told the truth, the historical truth since 1842 and the truth about Indian diplomacy since 1947. New Delhi knew that an incipient boundary dispute lurked but chose not to negotiate with China and instead to impose on it its own unilateral version of the border in both sectors, the western and the eastern.

Nehru’s unilateral change

The McMahon Line, settled with the Tibetans in 1914, is a treaty line. The Notes exchanged between the parties do not define it. They drew a line on a map with a thick nib dipped in red ink, leaving room for dispute. Neither side has a right to alter it unilaterally. Nehru did so admittedly. He confidently informed the Lok Sabha on September 23, 1959, that in one area “it was not considered a good line and it was varied afterwards by us, by the Government of India”. By this test, a party can also unilaterally alter a provision in the treaty because it considers the language to be imprecise or inelegant.

This approach was extended to the west with yet graver consequence and greater illegality. India’s official maps of 1948 and 1950 showed the entire northern boundary from the China-India-Afghanistan trijunction in the west to the China-India-Nepal trijunction to the east as “undefined”. That, be it noted, very much includes the area which is the subject of the China-Pakistan Boundary Agreement of March 2, 1963. Those maps were published in Frontline (July 13, 2012; pages 46-47).

Homage to the 1962 martyrs at the Tawang war memorial on October 20.

By a memorandum of July 1, 1954, Nehru directed the Ministry of External Affairs to withdraw earlier maps and print new ones showing “a firm and definite one [line] which is not open to discussion with anybody”. The new line involved the inclusion of Aksai Chin within India by the “idealistic” and “romanticist” Nehru. This was after the Panchsheel Agreement of April 29, 1954.

Robert Trumbull of The New York Times was one of the ablest foreign correspondents New Delhi has seen. In a report published by The Times of India on December 7, 1950, he noted, “A classic pattern for a border dispute is present.”

Nehru was well aware of that, as he admitted in the Rajya Sabha on December 9, 1959: “Right from 1950 or, at any rate from 1951, when the Chinese forces came into Tibet, we have had this problem before us. It has not suddenly come up before us this year or last year. We have had this problem before us and this developing picture which I have put before you, of two power states merging, two power states coming face to face with each other on a tremendous border. Ever since 1950s, this was the picture before us. We may have differed as to the timing in our minds, as to when this will happen, whether in five years, ten years, fifteen years, thirty years, it was difficult to say. But we had that picture. And looking through my old papers when this occurred, I was surprised myself to see how we had referred to these contingencies eight or nine years ago in our papers and how we had written to our Ambassador in Peking and others, especially at Peking, and asked for his reactions. In those early years of this present-day Republic, the Chinese Republic, Mr. K.M. Panikkar was Minister there and I read through his notes on the subject and our notes to him and our decisions. From the very first day and all the time this problem came before us, about our freedom. It is not a new problem. The question was whether we should raise it in an acute form at that stage.”

He proceeded to explain why India did not raise this question of frontiers at the very beginning: “Mr. Panikkar himself advised us at that time, ‘Yes, you need not raise it; but declare it openly’. We declared it in Parliament. We declared it before the Chinese Government and all that.” He was referring to his statement in the Lok Sabha on November 20, 1950. “The McMahon Line is our boundary, map or no map. We will not allow anybody to come across that boundary.”

Nehru, however, said that he wished “to admit that a lingering doubt remained in my mind and in my Minister’s mind as to what might happen in the future. But we did not see how we were going to decide this question by hurling it in that form at the Chinese at the moment. We felt that we should hold by our position and that the lapse of time and events will confirm it and by the time perhaps, when the challenge to it came, we would be in a much stronger position to face it. I may be perfectly frank to the House. It is not as if it was ignored or that it was not thought about.” (Emphasis added, throughout.)

Nehru’s own doubts on Aksai Chin

January 1958: Nehru with Marshal Yeh Chien-ying, Chairman of the National Defence Council of China, and Defence Minister V.K. Krishna Menon at the Cadet Corps Rally in New Delhi.

Nehru could not have chosen a worse adviser than Panikkar. Speaking at a reception organised in his honour by the Press Association in New Delhi on October 28, 1951, Panikkar said the Chinese government “has never claimed to be a Communist government; in fact it objects to being called a Communist government”. Nehru despised him, as he confided to Chester Bowles, the United States Ambassador. He respected Sir Girja Shankar Bajpai, Secretary General of the Ministry of External Affairs (MEA), who differed with Panikkar and advised Nehru to raise the issue with China. Nehru preferred Panikkar’s advice.

Vallabhbhai Patel’s famous letter to Nehru on November 7, 1950, was drafted by Sir Girja Shankar Bajpai. It referred cryptically at the end to “The Policy in regard to the McMahon Line”. The Aksai Chin was farthest from anyone’s consciousness. But the thorough professional Bajpai referred to a notorious fact, which Nehru was at pains to ignore. He wrote the letter for Patel because he knew that his chief would have ignored his own adviser’s letter. Nehru had scant interest in professional advice. He knew it all. The letter referred, in paragraph 3, to “the undefined state of the frontier”, presumably referring to the north-east. Nehru’s note in reply, dated November 18, 1950, said “our major possible enemy [ sic] is Pakistan. This has compelled us to think of our defence mainly in terms of Pakistan’s aggression. If we begin to think of, and prepare for, China’s aggression in the same way, we would weaken considerably on the Pakistan side. We might well get into a pincer movement.”

This is precisely what happened in 1963, and not only because he rudely rebuffed China’s Ambassador Pan Tsue-li’s warning of a two-front estrangement in May 1959. He had earlier rebuffed Prime Minister Zhou Enlai’s request for negotiations, in keeping with his decision of 1954. Yet he had doubts on the Aksai Chin and aired them freely.Let me tabulate them:

August 28, 1959: “The Aksai Chin area, that is an area about some parts of which, if I may say so, it is not quite clear what the position is. It is not at all that particular area. About other area [NEFA] the position is quite clear.”

August 31, 1959: “It is Indian territory and we claim it so because we think that the weight of evidence is in our favour, maps, etc., but the Chinese produce their own maps, equally old, which are in their favour. And the territory is sterile. It has been described as a barren, uninhabited region without a vestige of grass, and seventeen thousand feet high.”

September 4, 1959: “So far as the corner of the Aksai Chin area is concerned, that has been claimed by the Chinese as their territory and I believe in their maps too, not the new maps, but the old maps, that is shown as their territory. That is disputed and there are two viewpoints about that.… it is at an average of sixteen thousand to seventeen thousand feet altitude and treeless, grassless, almost or hardly of any kind without any living thing there.”

September 4, 1959, in the Lok Sabha: “But the broad McMahon Line has to be accepted and so far as we are concerned it is there and we accept it. The position about Ladakh is somewhat different. The McMahon Line does not go there… the actual boundary of Ladakh with Tibet was not very carefully defined. It was defined to some extent by British officers who went there, but I rather doubt if they did any careful survey.”

Indian Army soldiers near the Line of Actual Control in Bumla, Arunachal Pradesh, at an altitude of 4,700 metres above sea level, on October 21.

September 10, 1959: “We have always looked upon the Ladakh area as a different area, if I may say so, some vaguer area so far as the frontier is concerned because the exact line of the frontier is not at all clear as in the case of McMahon Line… it is a territory where not even a blade of grass grows, about seventeen thousand feet high. Nothing can be more amazing folly than for two great countries like India and China to go into a major conflict and war for the possession of a few mountain peaks, however beautiful the mountain peaks might be, or some area which is more or less uninhabited.”

September 17, 1959: “This place Aksai Chin area is in our maps undoubtedly. But, I distinguish it completely from other areas. It is a matter for argument as to what part of it belongs to somebody else. It is not at all a dead clear matter. It is not clear. I cannot go about doing these things in a manner which has been challenged to [ sic] the ownership of this strip of territory. This has nothing to do with the McMahon Line. It has nothing to do with anything else. That particular area stands by itself. It has been in challenge all the time.” In short, the Aksai Chin was disputed territory.

What was happening in 1958

B.N. Mullik, who was the Director of the Intelligence Bureau (I.B.), recounted, in his memoirs, in authoritative detail the stand taken by the Ministry of External Affairs even in 1958, four years after the 1954 directive, when the report of a patrol party showed the presence of Chinese personnel in the Aksai Chin plateau in north-east Ladakh:

A map showing the political reorganisation of India up to March 31, 1948, sourced from "Notes, Memorandum and Letters Exchanged between the Governments of India and China, White Paper", New Delhi, Government of India, July 1948.

“This report was discussed in the External Affairs Ministry with the CGS [Chief of the General Staff] present. The line taken by the Ministry was that the exact boundary of this area had not yet been demarcated and so in any protest we lodged we could not be on firm grounds…. In the meantime, a report had been received from our Embassy in Peking about the completion of the Aksai Chin road. We had also earlier reported it. So in June 1958, another meeting was held in the Ministry of External Affairs. This was attended by the CGS also. The Foreign Secretary maintained that neither the Embassy report nor the Intelligence report conclusively proved that the Sinkiang-Western Tibet highway actually passed through our territory and no Indian party had actually traversed this route and so before any protest was lodged we should be sure of our ground. Hence it was decided that two patrol parties would be sent to traverse the Aksai Chin road and see it on the ground if it passed through Indian territory.”The I.B. held that it did:

“Our recommendations was discussed in January 1959, at a meeting in the External Affairs Ministry with General Thimayya, Chief of the Army Staff, present. Thimayya quite categorically stated that he did not consider that the Aksai Chin road was of any strategic importance nor was he willing to open any posts at Peking Karpo and Sarigh Jilganang Kol because he felt that small army posts would be of little use and in any case he had no means of maintaining them from his base at Leh. …The Foreign Secretary also agreed with Army Chief and felt that posts at Shamul Lungpa, Shinglung, etc. would be of no use to stop Chinese infiltration. They might even provoke the Chinese into making further intrusions. I was informed by the Foreign Secretary after some days that the Prime Minister had approved of his views and no posts need be opened in the area. …

“The attitude of the External Affairs Ministry was that this part of the territory was useless to India. Even if the Chinese did not encroach into it, India could not make any use of it. The boundary had not been demarcated and had been shifted more than once by the British. There was an old silk route which was a sort of an international route. The Chinese had only improved it. It would be pointless to pick up quarrels over issues in which India had no means of enforcing her claims.”

A wounded soldier being carried to an Air Force helicopter in NEFA for evacuation to a hospital during the war.

India’s demarche to China on August 21 concerned the maps. In his letter to Zhou Enlai on December 14, 1958, Nehru quoted from the records of their discussions in 1954 and 1956 in which Zhou had proposed to recognise the McMahon Line.

It was Zhou’s reply of January 23, 1959, which raised the question of the western sector: “First of all, I wish to point out that the Sino-Indian boundary has never been formally delimited. Historically no treaty or agreement on the Sino-Indian boundary has ever been concluded between the Chinese Central Government and the Indian Government. So far as the actual situation is concerned, there are certain differences between the two sides over the border question…. The latest case concerns an area in the southern part of China’s Sinkiang Uighur Autonomous region, which has always been under Chinese jurisdiction. Patrol duties have continually been carried out in the area by the border guards of the Chinese government. And the Sinkiang-Tibet Highway built by our country in 1956 runs through that area. Yet recently the Indian government claimed that the area was in Indian territory. All this shows that border disputes do exist between China and India.”

Nehru’s turnaround

In his reply on March 22, 1959, Nehru flatly asserted: “A treaty of 1842 between Kashmir on the one hand and the Emperor of China and the Lama Guru of Lhasa on the other mentions the India-China boundary in the Ladakh region. In 1847, the Chinese government admitted that this boundary was sufficiently and distinctly fixed. The area now claimed by China has always been depicted as part of India on official maps, has been surveyed by Indian officials and even a Chinese map of 1893 shows it as Indian territory.” Every one of the statements was historically untrue. As late as 1950, Indian maps showed the entire northern boundary as “undefined”.

In 1842, there was no linear boundary, only border zones ( ilaqas). The Treaty of 1842 was a non-aggression pact concluded after a war. If it defined the boundary, why did the British (a) set up two boundary commissions to negotiate with China after making Kashmir part of the Empire in 1846; (b) keep deliberating from 1847 to 1905 on possible boundaries to offer to a China reluctant to respond; and (c) make a formal offer in writing on March 14, 1899? Nehru could not possibly have been unaware of them when he wrote as he did two months after Zhou’s letter. He wanted to shut the door on any discussion on the border. S. Gopal’s predecessor as Director of the MEA’s Historical Division was K. Zachariah. Under his supervision the Historical Division had prepared in 1951 a comprehensive and objective paper entitled “Studies on the Northern Frontier” based on the archives. It discussed the history and circumstances in which different lines of frontier were suggested. The paper is still kept secret, though the public has a right to its disclosure under the Right to Information Act. On March 24, 1953, a decision was taken to formulate a new line for the boundary. Nehru’s directive of July 1, 1954, followed.

Ironically, Nehru himself repeatedly pointed out that the Aksai Chin was of no value to India. He said on August 31, 1959, in the Rajya Sabha: “The territory is sterile. It has been described as a barren, uninhabited region without a vestige of grass and 17,000 feet high.” On September 10, in the same House, he revealed why he was so worked up about such a piece of land. “We may get excited about the sacredness of the Indian soil and the Chinese people may get excited about something they hold sacred, if they hold anything sacred. That is a different matter, but the fact of the matter is that nothing can be a more amazing folly than for two great countries like India and China to go into a major conflict and war for possession of a few mountain peaks, however beautiful the mountain peaks might be, or some area which is more or less uninhabited. It is not that, as every Member of this House knows. When such conflicts occur, something happens which stirs our innermost convictions, something which hurts our pride, our national pride, our self-respect and all that. So it is something more precious than a hundred or a thousand miles, and it is that which brings up people’s passions to a high level and it is that which, to some extent, is happening in India today. It is not because of a patch of territory but because they feel that they have not got a fair treatment in this matter, they have been treated rather casually by the Chinese government, and an attempt is made, if I may use the word, to bully them.”

There was nothing minatory at all in Zhou’s letters. Nehru it was who had rebuffed his overture in March 1959, well before the clashes at Longju on August 25, 1959. The massive publicity given to that incident, coupled with Nehru’s rhetoric, invested the issue with “pride… self-respect… and… people’s passions”. What about China’s feelings? As Nehru himself recognised in the Lok Sabha, “the Chinese attach importance to this area because of the fact that this route connects part of Chinese Turkstan with Gartok-Yehcheng [in Tibet]. This is an important connection.” More, it was a non-negotiable vital interest.

On February 12, 1951, Major R. Khating, a Tangkbul Naga, evicted the Tibetan administration from Tawang, south of the McMahon Line, and established a sub-divisional headquarters there. China responded with a studied and significant silence. It made no protest. A fateful movement was taking place in the western sector, as B.N. Mullik’s records show, from October 1951. Eventually the Chinese preferred the shorter route. On October 6, 1957, that road was ceremoniously declared open. No Indian “police party had actually traversed the portion of the road within the Aksai Chin itself”. In 1958 the MEA opined that it was pointless to make an issue of it. So did the Army. (Mullik, The Chinese Betrayal; page 205).

To this day not one country has supported India’s claim to the Aksai Chin. The U.S. Ambassador John Kenneth Galbraith’s statement of U.S. support to India issued on October 27, 1962, during the war, was confined strictly to the McMahon Line “as the accepted international border… sanctioned by modern usage”—not sanctioned by the notes exchanged between India’s Foreign Secretary, Sir Henry McMahon, and Tibet’s representative, Lonchen Shatra, on March 24, 1914. There was no reference to the Aksai Chin. A mea culpa is in order. This writer consistently criticised the Soviet Union and the Russian Federation for not showing the Aksai Chin as Indian territory in their maps. Recent research in the National Archives revealed their problem. All of the late 19th century, Russia had opposed any concessions by China to India on the western border. The Foreign Office in Moscow was helpless.

A Red cross team on its way to receive Indian prisoners of war released by the Chinese.

From the archival material, the status of the area can be summed up in six propositions. 1. The Ladakh-Tibet Treaty of 1842 did not define the boundary between them. 2. The boundary in this sector was undefined. 3. There existed a no-man’s land in this region. 4. The boundary preferred by the British was the Karakoram watershed, claimed by China, not the Kuen Lun watershed India belatedly claimed. 5. China was none too certain about its boundary then either. 6. No boundary had any legal or moral sanction unless it was defined by both sides, the British insisted. Unilaterally drawn maps are worse than useless. They are destructive of mutual confidence (A.G. Noorani; India-China Boundary Problem 1846-1947; Oxford University Press, 2011; pages 213-218).

Refusal to negotiate

Nehru did worse than ignore the facts of history and make assertions that were palpably false. He refused to negotiate at all. He wrote to Zhou Enlai on September 26, 1959, imposing arrogantly two unrealistic and humiliating conditions which no self-respecting country would accept. “No government could possibly discuss the future of such large areas which are an integral part of their territory. …. No discussion can be fruitful unless the posts on the Indian side of the traditional frontier now held by the Chinese forces are first evacuated by them and further threats and intimidations immediately cease.” Thus, even if China had agreed to put on sackcloth and ashes and withdrew in full glare of humiliating publicity, India would still not negotiate. When Zhou kept pressing for talks urgently, if need be at Rangoon, Nehru’s reply was cold. “How can we, Mr. Prime Minister, reach an agreement on principles when there is such complete disagreement about the facts?” What Nehru, of course, failed to realise, was that, unlike him, the Chinese Prime Minister did not regard the matter as a juridical issue in which one examines facts and discusses principles. What Zhou had in mind as “principles” were the basics of a deal.

Nehru followed it up with a letter on February 5, 1960, in which he said that the positions of the two countries “were so wide apart and opposed to each other that there was little ground left for useful talks”. With regard to the Chinese contention “about the entire boundary never having been delimited”, Nehru said, “On that basis there can be no negotiations.”

Not surprisingly, Zhou’s talks with Nehru in New Delhi in April 1960 failed, although he was prepared to accept the McMahon Line and said as much in a meeting with Nehru on April 22. It was the last of the four points he propounded then. The six points he mentioned at his press conference on April 25 were an elaboration of the first three. The fourth, rejected by Nehru, was omitted—never to be recalled. It read thus “(iv) Since we are going to have friendly negotiations, neither side should put forward claims to an area which is no longer under its administrative control. For example, we made no claim in the eastern sector to areas south of the McMahon Line, but India made such claims in the western sector. It is difficult to accept such claims and the best thing is that both sides do not make such territorial claims. Of course, there are individual places which need to be re-adjusted individually; but that is not a territorial claim.”

He repeated them in crisp formulations in a meeting with Nehru the next day as forming “a common ground”. They were: “(i) Our boundaries are not delimited and, therefore, there is a dispute about these; (ii) however this [ sic; there?] is a line of actual control both in the eastern sector as well as the western sector and also in the middle sector; (iii) geographical features should be taken into account in settling the border. One of the principles would be watershed and there would be also other features, like valleys and mountain passes, etc. These principles should be applicable to all sectors, eastern, western and middle; (iv) each side should keep to this line and make no territorial claims. This does not discount individual adjustments along the border later; (v) national sentiments should be respected. For both countries a lot of sentiment is tied around the Himalayas and the Karakoram.”

Nehru’s approach was radically different. “We should take each sector of the border and convince the other side of what it believes to be right.” It is truly amazing that Nehru should have considered this at all as a realistic option in international politics. It is unreal even in domestic politics. On the fourth point, renunciation of territorial claims by both, Nehru responded on April 24: “Our accepting things as they are would mean that basically there is no dispute and the question ends there; that we are unable to do.”

July 29, 1950: K.M. Panikkar presenting his credentials as the Indian Ambassador to Mao Zedong, then Chairman of the People's Republic of China, in Peking (Beijing).

A fine opportunity was lost. Nehru knew very well that: (1) India’s maps showed an undefined boundary in the west, so much so that in one of them the yellow colour wash did not extend to a huge part of Kashmir in the east (these were maps made by India’s Surveyor-General); (2) he had himself altered them unilaterally in 1954; (3) he had conceded in August-September 1959 that the Aksai Chin was disputed territory; (4) the Army Chief, General Thimayya, said in January 1959 that the Aksai Chin was of no strategic importance; (5) in 1958, the MEA had, in Thimayya’s presence, opined that “the exact boundary of this area had not yet been demarcated” (in the context, it meant defined); and (6) Dr. K. Zachariah, Director of the External Affairs Ministry’s Historical Division before Dr. S. Gopal took over, had endorsed that view.

As the exchanges proceeded Nehru developed a fine distinction which still holds our diplomats in its thrall—the distinction between talks and negotiation. To negotiate is to compromise, and compromise is anathema to us. Hence the rejection of the word “dispute” to characterise our long-festering disputes. Here is one sample. At a press conference on January 8, 1960, he was asked, “On a prior occasion, both in Parliament and here, you said that the country’s frontiers are not negotiable. Is that still our stand?” Nehru replied: “That is our stand. At the same time there is nothing that is not negotiable which seems to be contradictory. What I said was there is no question of negotiation or bargaining about these matters, but it is a somewhat different matter dealing with them as we are in our letters or in our talks. One can’t refuse to talk, refuse to—as between two countries.”

Here is a tabulation of the egregious blunders. 1. Unilateral revision of the McMahon Line and the maps in 1954. 2. Refusal to negotiate during the period 1954-58. 3. Assertion of a false claim in 1959. 4. Refusal to accept China’s claims in the Aksai Chin. 5. Rebuff to Pour Tsu-Li in May 1959. Similarly, the rejection of Zhou’s proposal in April 1960 though it accepted the McMahon Line and the Forward Policy. It was approved on November 2, 1961, in a meeting presided over by Nehru. Its implications were tersely summed up by a source by no means hostile to India but very hostile to China during the period. In May 2007, the U.S. government published a Central Intelligence Agency (CIA) Staff Study commissioned by the Department of Defence on “The Sino-India Border Dispute” from 1950 to 1962.

It was in three sections. Section three on page 22 notes that the Chinese concluded that in effect Nehru had switched from refusal to settle the border dispute by talks to using force. The study notes: “Formulated in December 1961, the army plan envisaged operations in Ladakh by spring when weather conditions improved. The plan called for the establishment of five new Indian posts of 80-100 men each behind nine existing forward Chinese posts in Ladakh west of the 1956 Chinese claim line; the posts were to be manned all year round. [V.K.] Krishna Menon, [the Defence Minister], instructed the Indian Air Force to prepare a report on its capability to sustain a major air supply effort. (Two of the posts were to be set up close to the western part of the Aksai Plain road, but the Indians were unable to move anywhere near it in subsequent encounters.) Briefing Cabinet Subcommittee officials on the Nehru-approved plan in late December, Krishna Menon stated that the new posts would be positioned to cut off the supply lines of targeted Chinese posts; they were to cause the ‘starving out’ of the Chinese, who would hereafter be replaced by Indian troops in the posts. These points would serve as advanced bases for Indian patrols assigned to probe close to the road.” And, of course, China would acquiesce in all this.

November 12, 1962: UNI staff corresponent Michael T. Malloy (centre) with Indian troops in the Se La region of what was then NEFA, when newsmen were allowed to visit the area for the first time since the hostilities started. On his return, Malloy filed one of the first "up front" dispatches on the dispute. A few days later, the invading Chinese forces captured the Se La Ridge before declaring a ceasefire.

Nehru was convinced of victory. On November 28, 1961, he informed Parliament: “I do not think the last two years… have changed the situation to the advantage of the Chinese in these (Ladakh) areas…. I think the situation has… changed progressively in our favour, though not as much as we want it to… they are still in areas which they occupied… but progressively the situation has been changing from the military point of view and from other points of view in our favour and we shall continue to take steps to build up these things so that ultimately we may be in a position to take action to recover such territory as is in their possession.” By force.

The CIA study cites confidential reports to the Indian Cabinet. Nehru said: “We will continue to build these things up so that ultimately we may be in a position to take effective action to recover such territory as is in their position.” Indian posts were set up behind Chinese posts in Ladakh.

In June 1962, India set up a post in Dhola to the north of the McMahon Line but to the south of its Indian variant. On September 8, Chinese forces invested that post. Nehru fell for the bait and sought rashly to seek their eviction (Klaus H. Pingsheim; “China, India and the Himalayas Border (1961-1963)”; Asian Survey; October 1963).

April 20, 1960: Nehru with Zhou Enlai in New Delhi. The Indian Prime Minister walked into the crisis with is eyes wide open.

On June 23, 1962, at the Warsaw talks, the U.S. assured China that it would not support the KMT in Taiwan in any military venture. This released Chinese troops for deployment on the boundary. Nothing can justify China’s massive retaliatory attacks on October 20, 1962. But to understand is not to exonerate.

Two scholars of impeccable credentials traced the decision-making process in China in 1962 from June to October—Roderick MacFarquhar in his work The Origins of the Cultural Revolution, (Oxford University Press, 1997; page 298-323) and Professor John W. Garver in the essay “China’s Decision for War with India in 1962” published in Alastair Irvin Johnston and Robert S. Ross (edited) New Dimensions in the Study of China’s Foreign Policy (Stanford University Press, 2006; pages 86-130). Both works are based on Chinese sources and repay study. Mao led from the front. Also worth study is the Soviet Union’s policy during that war.

November 1962: University students of Delhi at a procession protesting against the Chinese aggression.

When the border dispute erupted, Peking Review of September 15, 1959, published a map endorsing the one drawn by Lt.-Col. John T. Walker in 1851. It would have spelt significant Chinese withdrawal in Ladakh. For that matter, while accepting Zhou’s proposal Nehru could well have asked for China’s withdrawal from the Chang Chenmo Valley, which it had occupied only in the summer of 1959. In 1979, Deng Xiaoping offered a package deal to Vajpayee. It was rejected. Walker was Superintendent of the Great Trigonometrical Survey of India. His map of 1851 belies Nehru’s stand on the Treaty of 1842.

Now all that belongs to the past. China has hardened its line in the last two decades. India is still stuck in the attitudes of the past. What conclusions could China have drawn from India nominating a former Director of the I.B., M.K. Narayanan, as its negotiator? China knows that India is not prepared to negotiate and is itself fed up with the charade. The best course is to end it and build up a national consensus for a settlement while quietly sounding China on possible relaxation in its position. It will be a long haul.

Retrospect can help

But a thorough intensive retrospect can help. Because old habits of thinking persist, as smug and self-righteous as ever.

Any honest retrospect must confront some historical facts. Nehru knew that a latent boundary dispute did exist. He opined in a note to the MEA on June 18, 1954: “Of course, both the Soviet Union and China are expansive.” Why then did he actively foster the Bhai-Bhai climate, as distinct from a correct cordial relationship? Did he imagine that in that clime the dispute would be extinguished?

Prime Minister Manmohan Singh with Dai Bingguo, Chinese Special Representative for the India-China border talks, in New Delhi in April 2007. National Security Adviser M.K. Narayanan is also present.

But it might well not have arisen. India forcibly, but rightly, took over Tawang on February 22, 1951. China did not protest despite its stand on the McMahon Line. It built a road through the no-man’s land in Aksai Chin and assumed India would acquiesce likewise. Nehru knew it was disputed area and of no use to India. Was it wise or in the national interest to make an issue of this? His was an utterly unprofessional approach. He rebuffed China’s overtures and its offer to accept the McMahon Line as well (1959-60). This, apart from the Pakistan factor which obsessed him. Did he expect any state meekly to accept the boundary line as laid down by another state? Nehru based his policy, the Forward Policy in particular, on the assumption that any war between the two countries would trigger off a world war. He told the Rajya Sabha on December 6, 1961, after launching the Forward Policy: “Is it imaginable that a war between India and China will remain confined to these two countries? It will be world war and nothing but a world war.”

Denis Healy’s seminal article on limited wars, facilitated by the U.S.-USSR, “Balance of Tenor”, had appeared in Encounter in 1955, and Henry Kissinger’s magnum opus Nuclear Weapons and Foreign Policy on the same theme was published in 1958. But Nehru was utterly unaware of the very concept of a limited war.

Defence Minister A.K. Antony with his Chinese counterpart, Liang Guanglie, in New Delhi on September 4. This was the first visit in eight years by a Chinese Defence Minister to India. The two Ministers discussed a wide range of issues relating to defence and military exchanges and cooperation.

Why did Jawaharlal Nehru stake his prestige and the honour and prestige of the nation on a matter like this? And to the extreme limits that he did? He laid down preconditions to talks instead of negotiating. That persists still in a modified form.

The truth is a liberating force. The nation must be told the truth in its own interests so that it is prepared for a settlement. This requires two steps. First, ignore the Central Information Commission’s (then headed by Wajahat Habibullah) disgraceful order and publish the Henderson Brookes report on the war and the Zachariah report on the true history of India’s northern frontier. It is dishonest to suppress them from the nation.* * *

Egregious blunders

1. Unilateral revision of the McMahon Line and the maps in 1954.
2. Refusal to negotiate during the period 1954-58.
3. Assertion of a false claim in 1959.
4. Refusal to accept China's claims in the Aksai Chin.
5. Rebuff to Pour Tsu-Li in May 1959.
Similarly, the rejection of Zhou Enlai's proposal in April 1960 though it accepted the McMahon Line and The Forward Policy

How Relevant Are Leadership Lessons from an Ancient Indian Classic?

Published: November 15, 2012 in India Knowledge@Wharton

With iconic corporate leaders like Rajat Gupta, former managing director of consulting firm McKinsey & Co., being convicted of insider trading, notions of leadership and corporate ethics are once again in the spotlight. In his recent book, Timeless Leadership: 18 Leadership Sutras from The Bhagavad Gita, Debashis Chatterjee, director of the Indian Institute of Management in Kozhikode, has tried to glean universal principles of leadership from the ancient classic.

The Bhagavad Gita, also referred to as The Gita, comprises about 700 verses and is part of the ancient Indian classic,The Mahabharata. While The Mahabharata centers on the power struggle between two groups of royal cousins and their battle in Kurukshetra in North India, The Gita is a conversation between two of its main characters, Arjuna and his mentor Krishna, in the battlefield. Faced with the dilemma of waging war against his kin, Arjuna is paralyzed into inaction and turns to Krishna for counsel. Responding to Arjuna's confusion, Krishna explains to Arjuna his duties as a warrior and a prince and also expounds on a range of practical and philosophical issues. The setting of The Gita, in the midst of a battle, is widely considered as an allegory for the ethical and moral struggles of human life.

Chatterjee has taught leadership classes at Harvard University and at the Indian Institutes of Management in Calcutta, Lucknow and Kozhikode for nearly two decades. He says the lessons from The Bhagavad Gita continue to be very relevant in the boardrooms of the 21st century across the world. In a conversation with India Knowledge@Wharton, Chatterjee notes, "The idea ofThe Gita is fundamentally a global idea. It just happens that it originated in India."

An edited version of the transcript follows:

India Knowledge@Wharton: In the introduction to your book, you have said that it is an attempt to "trans-create" rather than to translate The Bhagavad Gita for insights into leadership. Can you share your thinking on this?

Debashis Chatterjee: The Gita was written in Sanskrit a few thousand years ago. Actually, it wasn't written -- it was a spoken text, and it was in a particular context, which is The Mahabharata and the battle of Kurukshetra. If I had just translated the work, most readers would find it very difficult to connect. The point of conveying the truth of the work was to recreate the context in the corporate world. So I've looked at Kurukshetra as a corporate battle.... There is a land grabber, and there is a tragic hero, who despite all of his capabilities has a performance breakdown in the field. [The Gita] is a timeless classic, but it has to be revisited for each generation, for each context.... Trans-creation became very important because it tries to rescueThe Gita from the religious connotations.

India Knowledge@Wharton: How much, and in what way, is the idea of leadership that is adopted by a community or country impacted by its culture and history?

Chatterjee: Anybody who is in a leadership role is [shaped] by his or her history and culture and in turn [also] creates the culture. It's not an either/or process. My research tells me that someone who evolves out of a certain milieu carries the nuances of that milieu or that culture and, in turn, he will trans-create, he will impact the culture. If I look at The Gita, it is a universal principle expressed in a cultural context.... What has happened in the Rajat Gupta [insider trading] case in the U.S. is precisely the Gita playing out [in a different context.]

India Knowledge@Wharton: In an increasingly globalized world, how does one reconcile the different attitudes -- shaped by history, culture, economics and other factors -- toward leadership and justice? Also, how relevant are lessons of leadership from The Gita for the rest of the world?

Chatterjee: You are looking at globalization largely from the American economic perspective. There are many different kinds of globalization. There was a globalized world when there was no demarcation between countries and when there were no passports.... Ideas have no geographies. Jagdish Chandra Bose in India invented the radio around the same time or even before [Guglielmo] Marconi invented it in Italy, but Bose did not get the credit for it while Marconi did. Just because the motor car was first put in motion in America doesn't mean that the technology belongs to America. It belongs to the world. Or take gravity, which was discovered by [Isaac] Newton.... Any discovery process is just putting a name to what already is. The idea of The Gita is fundamentally a global idea. It just happens that it originated in India.

If anybody wants to do business in India, they have to study The Gita because most Indian CEOs swear by the book. Starting from Mukesh Ambani [chairman and managing director of Indian conglomerate Reliance Industries] down to virtually any CEO, if you ask them what is the one leadership book that has made the deepest impact, they will say it is The Gita.

India Knowledge@Wharton: But do they actually follow the principles of The Gita? There is so much corruption that one sees in the corporate world.

Chatterjee: Well, I can ask a counter question: The Ten Commandments have been around for such a long time. Do people follow them? The Gita is the deep structure of any Indian corporate leader, whether he follows it or not. One expression from The Gita -- be committed to your work and not the results -- is universally accepted in India. Every household in the country has read about it. And while the terminology of The Gita may be specific to India, the principles are universal. That was my work in the book; to glean the principles.

India Knowledge@Wharton: Globally, what are the most critical aspects of leadership at present? How are these different from earlier decades?

Chatterjee: There is an extraordinary amount of information overload that we carry in our heads today. Never before has the swarm of information hit us so badly. And alongside that, there is emotional turmoil. We are constantly in the "watch" mode. As a result, the pressure on the human psyche is huge.... For leaders to make sense of this overload and see what is critical becomes the number one global skill. You also need to look at the rapid discontinuities that are taking place in technology. Leaders need greater adaptability skills to gear up and change themselves and their organizations. Arjuna [the protagonist ofThe Gita] is the corporate CEO, who is taking on turmoil [of] the proportions of a battle and is not able to handle [the pressure.]. He requires another kind of consciousness. So, leaders of today need to adapt to another kind of consciousness where they are able to take in a lot more. Their neural architecture has to be reshaped differently. This means that their consciousness of their world has to amplify. This requires another stage of evolution and I think The Gita is a book of evolution. People should look at this book again very closely.

India Knowledge@Wharton: As a society, are we across the world becoming increasingly driven more by economic considerations? Is there also an increasing lack of work-life balance in our lives? What role can our leaders play in bringing about a balance and, also, what is the role of the business schools that are developing our future leaders?

Chatterjee: The point is that there is nothing called "work versus life".... Life does not present itself in compartments, as the mind does. The mind is constantly preoccupied. So when we talk of work-life balance, you are fundamentally talking about your preoccupation with work when you are at home and your preoccupation with home when you are at work. The Gita'ssolution is that if your occupation is clouded by your preoccupation, you are not really doing your work -- whatever work it may be. The challenge is how you deal with your preoccupations. The Gita shows [how you can] take away your preoccupation from your occupation, which means that you deal with your emotional overload and integrate your life well. Then the balance will be automatically restored in your life. The Gita is a phenomenal text in terms of attitude shifts that you need to have, that one needs to see life in its unity and not compartments.

India Knowledge@Wharton: You have said that The Gita is very relevant in the boardrooms of the 21st century. But corporate executives from other religions may have a mind-block against adopting the lessons based on a religious book. Do you see this as a barrier to wider acceptance of your book? And how do you propose to overcome this barrier?

Chatterjee: That's the reason why the title of the book is Timeless Leadershipand not The Bhagavad Gita. The subtext is 18 Leadership Sutras from The Gitaand not The Gita. Stephen Covey has taken the Mormon tradition and written the 7 Habits of Highly Effective People. I am looking at universal principles -- like for instance, E=MC2. And that's where the first point we discussed comes in -- my book is not a translation, it is a trans-creation. Anyone who has a block against the Hindu religion or India should not find it preventing him from appreciating the principles that cross geographies, cultural frontiers and also time barriers.

Banking for Terror

Sanchita Bhattacharya
Research Associate, Institute for Conflict Management

In what seems a logical culmination of events, Bangladesh has been given time until February 2013 to address deficiencies in its fight against money-laundering and terror-financing to avert black-listing by the Financial Action Task Force (FATF). The deadline was set at the FATF meeting held at Paris between October 15 and 19, 2012. FATF is an inter-governmental body established in 1989 with the objectives of setting standards and promoting effective implementation of legal, regulatory and operational measures for combating money laundering, terrorist financing and other related threats to the integrity of the international financial system.

Under this mandate, Bangladesh needs to adequately address the issue of criminalising terror financing and establish and implement procedures to identify and freeze terror assets, and to remove deficiencies in its anti-money laundering (AML) legislation and apparatus, to effectively combat the financing of terrorism.

After the FATF meeting, one of the members of the four member team from Bangladesh, headed by Additional Finance Secretary, Ranjit Kumar Chakraborty, stated, on October 22, 2012, “We are making preparations for addressing these deficiencies within the timeframe, set by the FATF… The Government may consider amending the existing Anti-Terrorism Act in line with the global standard to adequately address criminalizing terror financing.” Earlier, in 2009, Bangladesh promulgated the Anti-Terrorism Act, including provisions to tighten controls on terrorist financing in the country.

Internationally, the financing of terrorism was criminalized under the United Nations International Convention for the Suppression of the Financing of Terrorism, in 1999. To reinforce the 1999 Convention, the United Nations adopted UNSC Resolutions 1373 and 1390, directing member states to criminalize terror finance and adopt regulatory measures to detect, deter and freeze terrorists’ assets. The resolutions oblige all states to deny financing, support and safe harbour to terrorists.

Unfortunately, despite these conventions and resolutions, the U.S. Senate Permanent Subcommittee on Investigation, in its July 17, 2012, report titled U.S. Vulnerabilities to Money Laundering, Drugs and Terrorist Financing: HSBC Case History, disclosed that two Bangladesh-based banks, Islami Bank Bangladesh Limited (IBBL) and Social Islami Bank Limited (SIBL) were involved in terror financing. Regarding the functioning of HSBC, it was mentioned that the bank acted as a financier to clients seeking to route funds from countries like Mexico, Iran, Saudi Arabia, Syria, North Korea, Cuba, Sudan, Myanmar, Japan and Russia. The report also stated that the HSBC supplied dollars to IBBL and SIBL, ignoring evidence of their links to terror financing. HSBC did not submit these two banks to enhanced monitoring for suspicious transactions, despite recommendation by HSBC’s own Financial Intelligence Group (FIG).

According to the document, SIBL’s ownership stakes were held by two Saudi Arabia based non-governmental organizations (NGOs): the International Islamic Relief Organization (IIRO) - implicated in terrorist financing by the U.S. administration and included on the list of those prohibited to do business in the country; and Lajnat-al-Birr-al-Islam (Benevolence International Foundation, BIF), one of al Qaeda’s financers.

It was noted, further, that Saudi Arabia’s Al Rajhi Bank, also engaged in suspicious transaction, had a 37 per cent ownership in IBBL. HSBC also had maintained an association with Al Rajhi, a member of al Qaeda’s “Golden Chain” – a list including at least 20 top Saudi and Gulf States’ financial sponsors of al Qaeda, including bankers, businessmen, and former ministers.

The U.S. report on terror financing was not a recent finding. Since 9/11, the U.S. has taken strong steps to halt the flow of funds to terrorist organizations under Executive Order 13224 and related elements of the USA Patriotic Act.

The exposure of the unholy nexus between banking establishments and terrorist activities in Bangladesh can be traced back to the watershed country-wide serial bomb blasts on August 17, 2005. 459 explosions had been orchestrated in 63 of the country’s 64 Districts (excluding Munshiganj), killing three persons and injuring 100 others, on that date. After the serial blasts, which were orchestrated by the Jamaat ul-Mujahideen Bangladesh (JMB), the role of IBBL in promoting religious terror was brought under scrutiny, when Bangladesh Home Ministry constituted a committee to investigate terror financing. Subsequent to the arrest of the JMB ‘chief’ Shaikh Abdur Rahman and his second in command Siddiqui Islam alias Bangla Bhai, and the subsequent seizure of some banking documents, the investigation team documented suspicious transactions with IBBL branches in Sylhet, Gazipur and Savar, where violations of the Anti-Money Laundering Act were noticed. The Act which came into existence in 2002 was last amended on June 20, 2011. Rahman and Bangla Bhai were also found to have accounts with IBBL. The two were eventually hanged on March 30, 2007 – Rahman in Comilla Jail and Bangla Bhai in Mymensingh Prison.

IBBL was also found to be linked with the Kuwait based Islamic NGO, Revival of Islamic Heritage Society (RIHS), whose bank accounts in Pakistan were closed following 9/11. In Bangladesh, RIHS’s account with IBBL was closed in 2006, following revelations that, in November 2005, RIHS released BDT 20 million to facilitate suicide bombers in Bangladesh. Incidentally, Bangladesh experienced a suicide bombing on December 8, 2005, in Netrokona District, in which eight persons were killed and 46 were injured. In addition, two officials of RIHS, one from Sudan and the other from Yemen, were deported in 2006 for having channeled from Bangladesh over USD 700,000 to local and foreign terrorist organisations. Apart from the RIHS connection, linkages were also discovered to Yassin Qadi, a Saudi Arabian businessman and son-in-law of Sheikh Ahmed Salah Jamjoom, a foreign sponsor of IBBL. IBBL is also believed to have been closely tied to the August 17, 2005, serial bombings across Bangladesh.

Interestingly, Tarique Rahman, the son of Khaleda Zia (Chairperson of Bangladesh Nationalist Party, BNP and then Prime Minister), and the former vice-president of BNP, was also believed to be involved in suspicious money laundering operations. Reports indicate that Rahman and his associate Giasuddin al-Mamun, Managing Director of Channel-1 Television, were involved in money laundering, with Rahman linked forward to Dawood Ibrahim, the principal accused and fugitive in the March 12, 1993, serial blasts in Mumbai, India.

SIBL has purportedly been engaged in Shariah (Islamic Law) based banking in the country. Its Executive Vice President, Shawkat Ali, was apprehended by Kolkata (West Bengal, India) Police and was expelled from Kolkata in August 2006 for his involvement in undesirable and suspicious activities. SIBL is suspected to be engaged in routing funds to Kolkata, and from there to other destinations in India and abroad. SIBL’s principal patrons are known to be from the Middle East.

Investigation of the financial operations of terrorist groupings such as JMB and Harkat-ul-Jihad-al Islami Bangladesh (HuJI-B) discovered that a major chunk of their funding came from Pakistan through hawala (illegal money transaction) channels. Terrorist organizations also received regular funds from expatriate populations working in the US, Europe and Middle East. A pro-Pakistani Political party – Jamaat-e-Islami (JeI), Bangladesh, was found to be a frequent medium for foreign funding. Funds were reportedly transferred into JeI’s account with IBBL, and were then distributed to various terrorist outfits in the country. JeI was a coalition partner in Khaleda Zia’s Government.

Responding to growing international pressure after 9/11, the Bangladesh Government formed a central and regional taskforce on January 27, 2002, to deal with money laundering and terrorist finance. Subsequently, a Financial Intelligence Unit (FIU) was also established in Bangladesh Bank on May 16, 2007. A document titled National Strategy for Preventing Money Laundering and Combating Financing of Terrorism 2011-2013, outlines the Government’s present strategy to deal with the problem, and defines its mission, “To bring the anti-money laundering/combating of financing terror system and procedures of Bangladesh in full convergence with international best practice standards set by FATF and other multi-lateral forums”.

In November 2010, the National Coordination Committee, comprising all agencies dealing with anti-money laundering and finance related issues, was established. In addition, the Money Laundering Prevention Act (MLPA), 2012, was promulgated, repealing the Money Laundering Prevention Act, 2009. Similarly, the Anti Terrorism (Amendment) Act, 2012, has been promulgated, amending the Anti Terrorism Act, 2009, to meet international standards and to establish an effective regime in Bangladesh to deal with terror funding.

Unfortunately, as recent revelations, including those by the US Senate Subcommittee reiterate, such illegal activities continue in Bangladesh. Despite a sharp decline in Islamist terrorism related incidents and fatalities, Islamist extremist mobilization and radicalization continue in the country, and substantial flows of funds to groups connected with terrorist continues. Some linkages between Islamic Banking and terrorist organizations have now been brought into the open, but the networks have not been dismantled. In a country with a strong Islamist extremist constituency, and an intricate web of collusive relations with major political formations, as well as with significant financial organizations, potent clusters of a residual threat continue to exist. The Sheikh Hasina Government has taken dramatic steps to target and neutralize these subversive networks, with significant success. There is, however, a long struggle ahead before the threat is fully neutralized.


S.Gopal, November 15, 2012

Finally the breast beating and wailing seem to be dying down in India marking the occasion of 50th anniversary of the Sino – Indian war of 1962 . I always thought that a 50th anniversary is observed of happy events in a nation’s life . I would have preferred not to be reminded of this “golden jubilee” of a traumatic and ignominious period in the nation’s history . From berating the then trio of PM Nehru, Defence minister Krishna Menon and “ heroic “ Genl. Kaul who led the troops from his sick bed in Delhi , to calling the Chinese names for their “perfidy”, the “ China experts “ have come out with all possible theories on why we lost the war. In stark contrast the Chinese were striking a conciliatory note by saying that “ India and China were “partners instead of rivals” with common interests in development . Commenting on the war anniversary , China’s foreign ministry spokesman Hong Lei said that the common ground far outweighs disputes and common interests outnumber conflicts and that the world has enough space for the common development of China and India .

China can well afford to be conciliatory as they have the real estate they wanted viz Aksai Chin and don’t see the need to be acrimonious about what happened 50 years ago. Their claim on Arunachal Pradesh is to be viewed more as a bargaining chip in the negotiations. They had put out feelers in this regard in the past.

What is more important for India to contemplate is the fact that China is far ahead of it in economic , military and technological domains . As a former Chief executive of Microsoft India observed in a seminar last year “ the tail lights are receding “.

Witnessing the collapse of the Soviet union towards the end of 1980 s and seeing the remarkable war fought by the U.S. in the gulf ( the first Gulf war with preponderant use of precision weapons ) the Chinese realized the importance of technology in future wars . It decided to modernize their armed forces with emphasis on frontier defence technologies .

For the last decade or so China has started a programme of sweeping military modernization with a view to fight high tech wars. According to the forecast of the U.S. based IHS , China’s defence budget stood at $119.8 billion in 2011 and will rise to $238.2 billion in 2015, marking a combined annual growth rate of 18.75 percent during the period . The focus of China’s strategy is no more limited to Taiwan but a more regional defense posture.

China’s leaders must therefore continue to decide how to prioritize its large but hardly unlimited defense resources. China will in all likelihood focus on improving their strategic capabilities in the three “Near Seas” (the Yellow, East, and South China seas), the area where China faces territorial and maritime disputes with Japan , Vietnam and other south east Asian countries.

There are two areas in which China plans to increase its capabilities . One , its Naval Strength and the other Aerospace .

China has started concentrating on shoring up its naval capabilities , if not for a global role , for a regional role , to start with. This is evident from the statements of many of its leaders. On Oct 20 , Former Chinese president Jiang Zemin , still considered an influential figure within China’s ruling party, meeting leaders of the Shanghai Ocean University in Beijing, told those present that “the 21st century is the century of the sea” and that “as a country with scarce natural resources, China must attach great importance to marine development” .

As a long term strategic plan China may aim for a rudimentary, limited power projection by building few carrier groups and expanding its nuclear-powered submarine force. This could help China highly visible influence in East and Southeast Asia, the Western Pacific, and the Indian Ocean’s strategic sea lanes. A more capable nuclear submarine force, can enable China to indulge in coercive diplomacy , if need be.

One advantage China has is that it can produce large weapons and equipment at very competitive costs. For example, Chinese shipyards are said to be able to produce Type 071 amphibious warfare vessels (LPDs) for about one-third what it costs to build a San Antonio-class LPD in a U.S. yard, meaning that China’s costs are likely around US$565 million per ship.

During the celebration of the 60th anniversary of the founding of the PLA Navy back in April 2012 the first Chinese-made nuclear submarine was exhibited to an audience that included military delegations from 30-odd countries.

China’s first aircraft carrier has been unveiled on Sep 26 2012 though it has to go a long way in populating it with the necessary aircraft and providing the rest of the battle group needed to make it effective and safe. At the commissioning ceremony in the northeastern port of Dalian, Premier Wen Jiabao called the carrier’s launch a “milestone” in Chinese military history and weapons development. Yang Yi, a rear admiral in China’s navy, said in a commentary in state-run media that the carrier moves the country closer to fulfilling a national destiny to “not only be a land power but also a sea power”. Though the aircraft carrier may have psychological impact in the region , it is unlikely at the moment to act as a game changer. But what is more important to note is the Chinese determination to move into carrier based strategy and ambition to eventually graduate to a blue water navy .
Geographically, the near seas are of more concern to China as it views them as core zones of national interests where credible access denial and combat capabilities are needed regardless of budget constraints.

The other area in which they are boosting their capability is the Aerospace technology. Apart from military advantages of this area , it also stands to reason that development of aviation sector would benefit the economy since the country is characterized by vast distances , widely separated cities and towns and obstacles in the form of mountains and gorges which make land travel slow and difficult.

In 2011 , China announced its twelfth five year plan which included spending of one fourth of a trillion dollars on its aero space industry . A subsidiary of AVIC state owned aviation corporation had already bought two American companies one , Cirrus Aviation maker of small propeller planes and the second , Teledyne Continental which produced the engines for cirrus and other smaller aircraft.

It is interesting to note that two thirds of the new airports under construction today in the world are being built in China .The airlines in China are expected to increase their fleet size 3 times over the next decade or so.

There is of course a down side to this modernization of Naval and Aero space capabilities. Possessing the world’s second largest defense budget will allow China to indulge in increased spending to develop an increasingly capable military. However structural and economic compulsions in future could slow down this military
spending .The strength of China’s armed forces will thus be directly dependent upon China’s economic compulsions.

China has developed an Anti Ship Ballistic Missile (ASBM) capable of attacking U.S. carriers in the pacific. The ASBM based on DF 21 missile has both over the horizon radar (OTH) technology to locate the carriers in the sea , coupled with cluster of satellites to get the exact position and then use the terminal guidance for the missile to home on to a carrier. To achieve an effective and reliable ASBM capability Chinese have to ensure that an ASBM can defeat American missile defenses; second, equip a ballistic-missile weapon system to track and hit a moving target in its terminal phase; and last, provide accurate, real-time geo-location tracking and targeting data—particularly using space-based assets—to the missile system prior to launch. A study by the International Strategic Studies Group of the National Institute of Advanced Studies , showed that such a system is feasible. The ASBM would help the Chinese in their policy of Access and Area Denial policies which is dictated by Chinese concern over the US dominance of the Pacific and the latter’s v recent policy initiative to turn their strategic sights to this region.

Space Programmes

China is pursuing an ambitious and well-funded space program. 2011 was a note worthy year for Chinese space accomplishments. It conducted 19 non-test space launches, one more than the U.S. On 29 September 2011, China launched its first space laboratory module, Tiangong-1 (“Heavenly Palace 1”). On 18 June 2012, the three-person Shenzhou-9 mission—which included China’s first female astronaut, Liu Yang docked with Tiangong-1 in the Chinese space program’s first piloted rendezvous. On 24 June, in another Chinese first, Shenzhou-9 undocked and re docked manually with Tiangong-1 . The eventual aim is to master docking capabilities to assemble a space station .

China also appears to be building a smaller version of the American Shuttles called “Shenlong” with less than a third of latter’s cargo capacity . The aim is to validate many of space plane technologies . Chinese-language media claimed that on 8 January 2011, China completed a “test flight” of the Shenlong (Divine Dragon) space plane . The 4 ton winged space plane was rocketed into a 100 km. high suborbital trajectory for test of reentry systems starting at Mach 15. Continued successful development of the space plane could give the People’s Liberation Army (PLA) an operational military space plane comparable to the U. S. Air Force X-37B currently flying its second orbital mission. Comparing the parameters of the
two , the western experts are of the view that the Shenlong vehicle closely matches the U. S. Air Force X-37B . The military dimension of this programme is deducible from the fact that People’s Liberation Army is in charge of the “Shenlong” space plane project.

China’s space plane program could eventually develop into military hypersonic vehicle program. Chinese seem to be of the view that a space plane could perform certain military missions better than a space station, such as anti-satellite and reconnaissance, and thus enhance China’s “deterrence.”

China Aerospace Science and Technology Corporation is developing an advanced version of Long March 5 rocket’s 120-ton-thrust liquid oxygen (LOX) and kerosene engine. The engine is said to be more powerful than the 75-ton-thrust engines of the rockets used for launching China’s piloted Shenzou space craft. The engine is non-toxic, pollution-free and according to CMSE the engine makes China the second country in the world, after Russia, to grasp the core technologies for a LOX/kerosene high-pressure staged combustion cycle rocket engine . The new version of Long March 5 will more than triple Chinese rockets’ carrying capacity by lofting a maximum of 25 tons to low Earth-orbit and 14 tons to geosynchronous orbit . The increased lift is critical to China’s ambition to build a space station by 2020 and to the third phase of the nation’s moon mission , which aims to bring lunar rock samples — collected by a robotic rover — back to China for analysis .

According to a November 2009 article Jiang Feng a member of the China Strategy Institute stated the “next step’ of the Chinese Air Force is to “focus” on “developing” laser interceptor satellites . There are also reports that China’s air force is currently working hard to develop a new model orbital bomber .

The eight satellites China plans to launch into space to monitor ocean waters surrounding the country could , eventually be useful for an intelligence role too. With three maritime satellites already in orbit, adding eight more , according to John Walker of the Nottingham Trent University , was “a very significant investment just to monitor water.”
Development of new jet fighters.

On 31st October China successfully completed a test flight of its new fifth-generation J-31 jet fighter . China is the third country in the world – after the United States and Russia – to have developed a stealth fifth-generation fighter aircraft. The J-31 is a mid-sized combat jet with two Russian-made engines in its prototype development phase. The Chinese news paper Huanqiu Shibao said that production models will have Chinese WS-13 engines .

The Chinese are also developing the J-20 fighter jet with stealth technology and first flight tested in January 2011 . J-20 may become operational by 2020.

An image of a Chinese jet fighter with strong resemblance to American F-22 Raptor fighter and F-35 lightning 2 appeared on the web on Sept 15. with looks similar to a stealth aircraft. There is however no confirmation of its existence.. The new aircraft , according to some aviation experts ,could be a fourth-generation fighter with less sophisticated avionics than those of F-22 or F-35.

The aircraft model Shen Fei is described by an aviation expert Robert Hewson as an “F-35-sized F-22”, Some argue that the Shen Fei is a result of some Chinese cyber espionage . It is believed that the American Defence Secy. Panetta , during his recent visit to China , may have taken up the issue of cyber intrusions with the Chinese defense minister on Sep 18 , as a “ growing threat posed to both economic and security interests of the U.S. It is possible that Panetta had the Shen Fei in mind when he discussed the cyber intrusions.

Introduction of Drones

China is moving into use of drones in a big way . It is setting up the first two drone military bases in Liaoning province to monitor the situation in the coastal areas. North East region of China witnesses very high military activity with 10 military exercises involving the Navy and the Air Force of the USA, Japan and South Korea conducted in the region. China which views the region as strategically important has now decided to protect it by drones as well. They will be deployed to collect video information about the neighbors’ military exercises and help in coordinating the activities of China’s Air Force and the Navy in the waters of the Yellow Sea and the East China Sea.. Currently China is believed to hold 30 drones with various modifications .

The drones are also used to monitor the Diaoyu Islands which is with Japan . In a possible conflict between the two countries in those disputed waters the flights of China’s drones at low altitudes could be a bone of contention .

Chinese have obviously made a breakthrough to announce setting up of 11 drone bases by 2015 . It is not yet clear whether China would arm its drones . It however needs to be accepted that it would do so if they see the need to enter an armed conflict. For now China will deploy high altitude drones with a long range for intelligence missions and to guide the anti ship ballistic missiles which they have been developing .The Chinese mass media call them “aircraft carrier killers. It is estimated that from the Chinese Shaguang military base where they are located they would be able to hit targets located in 70% of the South China Sea waters with the remaining 30% controlled in the future by the Chinese aircraft carriers.

The value of drones both for offensive and defensive purposes
( monitoring ) is by now accepted as vital ingredients in next generation wars and weapons .

Though China has been reliant on Russian assistance in the development of core systems such as engines and avionics, China’s indigenous aerospace manufacturing base and its capabilities are now increasingly able to supply the PLAAF with aircraft platforms, technologies, and systems required for its modernisation. This is evident from the proportion of fourth-generation aircraft in service with the PLAAF, which has reportedly risen from 23% in 2005 to 33% in 2010, and is expected to reach about 50% by 2015.

Moving into the Arctic

Given its hunger for resources to fuel its galloping economy , China has now set its eyes on the Arctic seas , whose fast melting ice has exposed what is thought to be a treasure trove of minerals and oil. .As a first step towards its claims in the region , a senior PLAN officer said in 2010 that Arctic belongs to people all around the world . and China’s State Oceanic Administration claimed that China is a ‘near Arctic state’ and that the Arctic is an ‘inherited wealth for all humankind.’ China wants a permanent membership on the Arctic Council .Equally important for china is the fact that the opening of the arctic route makes the conventional sea lanes of communication through the Suez quite redundant for China, ending its fears over blockage of Malacca straits by hostile forces and offering it an alternate route to Europe.

China’s intentions are clear when one sees its actions . In September 2012, the Chinese ice breaker Xuelong capable of breaking 1.2 meters thick ice, completed an unprecedented round trip between the Pacific and the Atlantic via the Arctic,. The Polar Research Institute of China, said that the icebreaker performed scientific research operations including systematic geographical surveys, installation of an automatic meteorological station and investigations on oceanic turbulence and methane content in the Arctic area .

Yet another icebreaker, an 8000 ton vessel with an endurance capacity of 20,000 nautical miles, has been commissioned for polar expeditions. It is expected to be operationally ready by 2014 .


On June 15 2012 , a manned Chinese submersible set a new record for the deepest sea dive over 6,000 metres . The “Jiaolong” craft dived over 19,000 feet into the Mariana Trench in the western Pacific Ocean According to Xinhua news agency this is the first in a series of six dives which will plumb depths of 7,000 metres . The submersible, which carried three men, reached around 6,500 metres . Experts say China intends to use the submersible for scientific research, such as collecting samples of undersea life and studying geological structures, as well as future development of mineral resources.

Rare Earth consolidation and building up reserves.

Another indication of China’s plans to increase its strategic strength is in the rare earths field. It is regulating the rare-earth industry and is building up strategic reserve of the minerals. This enables the country to fix the prices and control the supply in the international market.

China is the world’s largest producer, consumer and exporter of rare earths, controlling over 90 per cent of global supplies. China’s rare earth oxides (REO) output has increased rapidly from a little over 1,000 tonnes in 1978 to more than 100,000 tonnes in 2012. Rare earths are a critical component of many defence and weapon technologies.

War under informationalised conditions

The armed forces are getting increasingly networked in communication and command structure. The new doctrine of fighting is termed “Local War Under Informationalized Conditions,” which will coordinate military operations on land, in air, at sea, in space and across the electromagnetic spectrum under a networked architecture. Consequently Chinese would like to maintain dominance in the battle space information domain and control adversary’s information. The People’s Liberation Army (PLA) is developing more comprehensive computer network exploitation (CNE) techniques to support strategic intelligence collection.

The US-China Economic and Security Review Commission Report on the Capability of the People’s Republic of China to conduct cyber warfare and Computer Network Exploitation had the following to say with respect to China’s plans for information warfare :
. “The direct result of this ambition is to attack the enemy’s networked information systems, creating “blind spots” that various PLA forces could exploit at predetermined times . Attacks on vital targets such as an adversary’s intelligence, surveillance, and reconnaissance (ISR) systems is envisaged by use of increasingly sophisticated jamming systems and anti-satellite (ASAT) weapons. Attack on adversary’s data and networks is part of the plan.”

The PLA is reaching out across the Chinese civilian sector to meet the intensive personnel requirements necessary to support its burgeoning IW capabilities, employing people with specialized skills from all sectors of economy as well as academia . One should not be surprised if they tap into China’s hacker community too . The PLA is training and equipping its force to use a variety of IW tools for intelligence gathering and to establish information dominance over its adversaries during a conflict. PLA campaign doctrine identifies the early establishment of information dominance over an enemy as one of the highest operational priorities in a conflict .”

It is clear from the technological developments mentioned above that China not only intends to be an economic but also a technological and military power equal to the U.S. . India indeed needs to take note of it and try to level up so that the tail lights do not vanish permanently.

(The writer, Mr S.Gopal, is visiting Professor, Sir Ashutosh Mukherjee Chair, National Institute of Advanced Studies, Bangalore, India.Email:



India’s relations with its neighbours need to be analysed frankly and unsentimentally, without recourse to the usual platitudes when pronouncing on the subject. It is fashionable to assume that there is some larger moral imperative that governs relations between neighbours, with the bigger country obliged to show a level of generosity and tolerance towards a smaller neighbour that would not be applicable to attiudes and policies towards a more distant country. The compulsions of “good neighbourliness” between countries are, however, not the same as between neighbours in the same building or the same street. In the case of the latter the rights, obligations and duties of citizenship are the same, all live under the authority of the same state and conflicts are mediated through the instruments of law. We should not commit the mistake of transposing to international relations the codes of conduct between citizens of the same country. The commandment “Love thy neighbour as thyself” elicits no obedience from the chancelleries of the world.

Before talking of India and its neighbours we should have a clearer idea of what, in India’s eyes, consitutes its neighbourhood. Should we look at India’s neighbourhood strategically or geographically? If the first, then a case can be made out that India’s neighbourhood encompasses the entire region from the Straits of Hormuz to the Straits of Malacca. This is India’s security parameter. Developments in this region have a major impact on India. On the western side, six million Indians are employed in the Gulf, sending back almost $35 billion as remittances. This region is the largest supplier of oil and gas to India. This area is the heart of Islam and influences and ideologies emanating from there impact on our immediate external environment and indeed, to an extent, the domestic scene. In any case, if India had not been divided in 1947, its western frontier would have extended to the Persian Gulf.

In the east, India’s possession of the Andaman and Nicobar islands stretches our frontiers to the other choke-point, the Malacca Straits. The Bay of Bengal has Bangladesh, Myanmar and Thailand as littoral countries. This stretch of the sea is our link to Southeast Asia and beyond. For buttressing our Look East policy this area is of vital importance. Apart from India forging bilateral ties with these countries, the security of the sea lanes of communication in an area where the only regional blue water navy is Indian devolves some special responsibilities on India.

If geography alone were to determine who our neighbours are, then Pakistan, Nepal, Bhutan, Bangladesh, Sri Lanka and Maldives constitute the core of our neighbourhood. Myanmar is a contiguous neighbour, but as we have conditioned ourselves over the years to view essentially the SAARC countries as our neighbours, Myanmar is lost sight of, despite its critical geograhical location adjacent to our north-eastern states. Myanmar, which applied for full membership in May 2008, has yet to consummate it. However, with the rapid changes in the country, its opening up and the progressive removal of sanctions it has been subject to, its profile as India’s neighbour will keep rising.

Aghanistan may not be a direct geographic neighbour today, but given the fact that we consider Pakistan’s occupation of the northern areas in Jammu and Kashmir as illegal, we can in a sense treat it as one. In any case, with the inclusion of Afghanistan as a full member of SAARC, the political case for treating Afghanistan as an integral part of our neighbourhood stands reinforced.

With China’s occupation of Tibet, that country has become our direct neighbour. The outstanding border issue between India and China constitutes a major Indian foreign policy problem, colouring our relationship with the world’s foremost rising power. Moreover, in India’s perception, China has adversely influenced India’s relations with its South Asian neighbours. China therefore qualifies as India’s most formidable neighbour, affecting India’s role not only in the South Asian region, but in Asia as a whole, and even at the global level.

The management of relations with neighbours is always a declared priority of any country’s foreign policy. The assumption is that a stable neighbourhood strengthens a country’s foreign policy posture, whereas an unstable and troubled neighbourhood saps its ability to act fully effectively on the international stage. The credibility of a country’s regional and global posture, it is believed, is also undermined if it is seen as embroiled in disputes and conflicts with neighbours. The accepted view is that the time and energy spent in controlling events in the immediate neighbourhood is at the cost of pursuing wider interests at the regional and global level.

In actual fact, most countries have very problematic relations with neighbours, and yet many are not held back because of this. Historically, Britain rose to global power status despite almost ceaseless conflicts with its neighbours. France became a world power despite being embroiled in wars with neighbours. China has huge problems with its neighbours, without this affecting its inexorable rise today as a global power. Turkey has problems with virtually all its neighbours, without this materially affecting its rise to regional power status. It is, therefore, open to question whether a stable neighbourhood is a pre-requisite for a country’s rise to regional or global status. There are many other factors at play that allow countries to rise and flourish even if their neighbourhood is not peaceful.

While in theory the need to have a peaceful, stable and friendly neighbourhood may appear self-evident, what would that mean in practical terms? Can one have good relations with neighbours simply because that would be desirable in itself? Can one build such relations unilaterally? To what extent should one be willing to make concessions? Should one look for reciprocity or not? How far is it the responsibility primarily of the bigger country to make the requisite effort in forging positive relationships? Is a smaller country always right in its demands? Can a country demand or plead for extra consideration simply because it is smaller? Should it on that basis be entitled to a more sensitive treatment of its fears, vulnerabilities and even paranoia?

These are not the only issues that arise in any examination of the conditions in which neighbouring countries relate to each other. What about the role of third parties, of external actors? During the Cold War period, the competing powers had an incentive to extend their political and ideological reach to all corners of the globe. In that process relations between neighbours, who were pulled at times in different ideological directions, were distorted, adding to already exisiting tensions or misunderstandings. Today, in the age of globalisation, different pulls and pressures operate, and these could be helpful or harmful depending on circumstances.

The short point is that countries cannot always act in their neighbourhood as they please depending on local advantages in power equations. Outside forces will be there to provide a counterbalance, either because a particular country might want to bring an external power into the neighbourhood to reduce the weight of a perceived regional hegemon, or external powers themselves, pushed by balance of power considerations, or policies of containment, may intrude into the region on their own and manipulate their local partners for larger strategic purposes.

Sections of Indian public opinion are acutely conscious of India’s failure to stabilize its own neighbourhood. It is argued that India as the biggest country in the region has the primary responsibility for managing the regional environment. Often India is criticized for not being sufficiently generous to its neighbours, of hesitating to make unilateral concessions to them, which it is believed it can well afford to do. Such concessions are advocated especially on the economic side, the argument being that India as a huge economy can easily absorb the limited sacrifice that is expected of it, and in the process can attach the neighbouring economies to itself in a mutually beneficial manner. The stakes which develop because of this interdependence would theoretically make it difficult for other governments to pursue adversarial policies beyond a certain point. Poor border management, failure to create proper border posts and customs infrastructure is viewed as another example of insensitivity to the need to facilitate relations with neighbours.

Such criticism overlooks many complexities. For one, India’s capacity to order its neighbourhood in a manner congenial to its requirements is exaggerated. India did intervene in Sri Lanka in agreement with its government, but the experience left it chastened to the point that it rejected an intrusive role in Sri Lanka later as the ethnic conflict grew, even when other countries prompted it to take greater responsibility for steering the course of events there in the right direction. It abdicated playing the central role in the developments leading to the defeat of the LTTE, and it is to be seen how much constructive influence it can bring to bear in ensuring that the present opportunity to settle the Tamil question equitably is not lost. India’s intervention in the Maldives at the request of its government was more successful, but this cannot be construed as an attempt by India to shape its immediate environment to suit its needs, or a model for future interventions.

India has been sensitive in handling the issue of democracy in its neighbourhood. Even as western democracies seek to impose democratic values on others and use instruments of moral reprobation and boycotts to coerce select non-democratic countries to reform their political systems, India has abjured such thinking. Its basic approach is to do business with whichever government is in power. Even as there is awareness that a truly democratic system in Pakistan, that limits the power of both the armed forces and extremist groups, would be beneficial to India-Pakistan ties, India has not sought to interfere in Pakistan’s internal politics. On the contrary, it has willingly done serious business with Pakistan’s military regimes, especially that of General Musharraf. Likewise in Bangladesh, India has never rejected serious engagement with the military regimes there. In the case of Myanmar, even at the cost of earning some diplomatic flak, India has sought to build close ties with it irrespective of the country’s regime for reasons of overriding national interest. India will of course abide by legalities and UN sanctions against any country for transgression of norms, but participating in a crusade for democracy because of a sense of superior political values is not part of India’s thinking about its neighbourhood and beyond. For India this is practical politics, shorn of the hypocrisy of those who promote democracy selectively and at lowest political and business cost to themselves.

India, despite its size and power, is, ironically, the country most targetted by terrorism from its own neighbourhood. Although terrorism is now considered a global threat and the consensus that it should be fought collectively by the international community has been largely forged, India is still threatened by this menace as Pakistan, where the epicenter of terrorism lies, has not yet been summoned by the international community, acting through the UN, to eradicate it. The US and its allies want Pakistan to control terrorist activity directed at them in Afghanistan, and deal as well with domestic terrorism that threatens to impair Pakistan’s capacity to support them. Terrorism directed at India remains a secondary western concern. Even US pressure, however, has not compelled Pakistan to break its links with the Haqqani group. The rise of religious extremism within Pakistan and the surrounding Islamic world, extending now to North Africa, is creating conditions for more jihadi violence. Pakistan’s failure to take any substantive step in the last four years to try those responsible for the Mumbai terrorist attack and the unwillingness of its leadership to accept that terrorism remains a crucial outstanding issue in India-Pakistan relations, indicates that the nexus between the jihadi groups and political and military power centres in Pakistan will not be easily broken. India by itself lacks the capacity to coerce Pakistan to abjure terrorism as an instrument of state policy, especially as Pakistan now has the nuclear cover for its lawless activities. Pakistan sees the extremist religious forces that resort to terrorism as allies against India and potentially in the takeover of Afghanistan after the western forces depart.

Within the SAARC region, apart from the recognition by the Karzai government of Pakistan’s sponsorship of terror, the other countries keep their political distance from the problem. Each of them, barring Bhutan, has interest in maintaining good ties with Pakistan for a mixture of motives that include leveraging Pakistan’s hostility towards India to their own advantage, combining forces against the threat of Indian domination, putting constraints on India’s freedom of action within the region, not to mention the need to politically manage their own Muslim communities. Pakistan of course has always had interest in undermining India’s leadership role in South Asia. SAARC conventions on combatting terrorism have little meaning given Pakistan’s complicity with terrorist groups. Pakistan in fact uses Nepal and Bangladesh as bases for infiltrating terrorists into India, or in the case of Bangladesh, using local extremists for targetting India, though with Sheikh Hasina’s government in Bangladesh this activity has been greatly curtailed.

The debate about unilateral concessions versus reciprocity is somewhat besides the point in international relations. A big country has no less responsibility than a small one to legitimately maximize its own interests. No country can sustain a policy of making unilateral concessions. If the logic is accepted that it is for the bigger country to make concessions, then it could be argued that the US should base its international policies on making unilateral concessions to all. And so should China. India has tried a policy of unilateral concessions in the late 1980s and the early 1990s, but the results have been meagre. It is ultimately a question of pragmatism. If making a concession in one area can yield a return in another area, it should be made. In any case, reciprocity need not be confined to balanced exchanges in specified areas. If Nepal, for instance, had been more sensitive to India’s security interests because of the open border, India could have been generous in areas of Nepal’s interest. If Bangladesh, as is the case now, is more cooperative in dealing with anti-Indian insurgents seeking shelter on its territory, it would certainly make India more receptive to some of its demands on the commercial side. In fact this has already happened. What does India do in a situation in which Nepal has for years blocked any progress in implementing joint water resources projects, or Bangladesh has until now even refused to talk about according transit rights through its territory to north-eastern India or make a joint effort to promote energy security along with Myanmar?

Rather than look at such issues within the framework of bilateral relations between India and its neighbours, they should be looked at within the framework of SAARC. The problem of unilateralism or reciprocity disappears once the SAARC countries as a whole agree on terms of trade and economic exchanges. Unfortunately, Pakistan right from the start worked to limit progress within SAARC so that its own policy of linking trade exchanges with India to a resolution of the Kashmir problem did not get undermined. For this reason, it did not adhere to its obligations to India under SAFTA. Indeed, because of Pakistan’s obstructive policies economic integration in the SAARC area is poor. This situation is beginning to change with fruitful talks between India and Pakistan to enhance trade with each other. Pakistan has agreed in principle agreed to grant by the year-end MFN treatment that it has long denied to India. With the just concluded Commerce Secretary level talks substantive steps on the trade and investment front have been listed in the joint statement. This change in Pakistan’s attitude has occurred not because of India’s prodding but because of an internal assessment Pakistan has itself made on the advantages to it from expanded economic ties with India, given the dire economic straits Pakistan is in. Pakistan has not yet felt the same compulsions on terrorism and other differences with India and hence it clings still to its negative political postures. Now that Afghanistan has joined SAARC, common sense would dictate that Pakistan accord transit rights through its territory to facilitate Afghanistan’s trade with India as part of the process of stabilizing Afghanistan and giving its people economic opportunities so that they can, amongst other benefits, expand their legitimate economy and conditions are created for the reduction in size of the illegitimate drug based economy.

India, of course, physically dominates its neighbourhood. Most of its neighbours are very small in comparison, geographically, demographically and economically. Even Pakistan, the second largest country in South Asia, is less than 15% of India’s size demographically and economically and is not too much more geographically. Beyond the disparity in size, India’s neighbours share with it strong civilizational, cultural, linguistic and ethnic ties that are deeply rooted in history. Normally these bonds should have brought the countries of the India sub-continent closer together, being theoretically the building blocks of an enduring people to people relationship. But this has not happened for various reasons. For one, India’s overwhelming civilizational influence makes the neighbouring countries feel insecure in their separate identities. As identity is a core constituent of a sense of nationhood, these countries want to foster it by consciously asserting their separate identity.

The ethnic links, such as those of the Madhesis in the Terai in southern Nepal and the Sri Lankan Tamils with the Tamils in Tamilnadu, instead of being a human link between India and these countries, as is the case with the Indian diaspora abroad and their country of origin, is a source of tensions. These sections of the population are not as yet fully integrated into the societies in which they live and suffer from disabilities. They are either suspected for their extra-territorial loyalties or are seen as instruments of Indian influence, or the sympathy and support they receive from groups in India create an atmosphere of distrust in bilateral relations.

From the viewpoint of India’s South Asian neighbours realpolitik would demand that they try to balance India’s weight by bringing into play external powers. This with the objective of giving themselves greater margin of manoeuvre vis-a-vis India, extorting more concessions from it than would be the case otherwise, not to mention making themselves more eligible for economic and military assistance from powers wanting to check-mate India’s rise or imposing costs on India for not following policies congenial to their interests.

Pakistan has, of course, in its obsessive pursuit of “parity” with India and a pathological refusal to accept any status of inferiority vis-a-vis it, has been most instrumental in facilitating the entry of outside powers in the sub-continent. Today China is Pakistan’s biggest defence supplier. The US too has not stopped supplying advanced arms to Pakistan as part of its policy to obtain the cooperation of the country’s military to help combat the insurgency in Afghanistan. With the US more and more cognizant of Pakistan’s duplicity on the terrorism front, tensions in US-Pakistan relations are palpable and Pakistan’s support for the US in Afghanistan now a question mark.

The US policy of hyphenating India and Pakistan was decisively abandoned by the Bush Administration in its approach to the nuclear equation in South Asia, though the US thought it necessary to balance its leaning towards India by elevating Pakistan to the status of a “non-NATO ally”. With the change of Administration in the US and the Afghanistan morass in which it is caught, Pakistan had found more room to leverage US dependence on it for its operations in Afghanistan to question the legitimacy of India’s presence and policies in Afghanistan, not to mention press it to extract some concessions from India on making progress on outstanding India-Pakistan issues without Pakistan being required to move credibly on the issue of terrorism directed against India from its soil. This has now changed, with the US openly supporting a stronger Indian political and economic role in Afghanistan, as well as in military training. India was the first country with which Afghanistan signed a Strategic Partnership Agreement. In Nepal, Bangladesh and Sri Lanka, Indian and US policies have converged far more than was the case in the past, with the result that the governments of these countries are no longer able to leverage India- US differences as before to counter the Indian weight.

China, with its increased political, economic and military weight, continues its policies to counter what one of its commentators described as India’s hegemonist policies vis-a-vis its neighbours. It continues to deepen its strategic relations with Pakistan, with current activity in the nuclear field, major road and power projects in POK and the development of Gwadar port. In Afghanistan China is investing heavily in the mineral sector. Geopolitics seem to dictate close China-Pakistan cooperation in Afghanistan, despite current uncertainties about Pakistan’s ability to contain its own internal failures.

In Nepal, China is becoming more assertive in demanding that it be given equal treatment with India, one example of which is to ask for its Friendship Treaty with Nepal to match the one with India. With the Maoists now a powerful political force in Nepal, and given their ideological compulsion to be seen as drawing Nepal closer to China, coupled with their periodic rantings calculated to inflame public opinion against India, the political terrain has become more favourable for China to expand and deepen its presence and influence in Nepal. This can only make India’s task in handling Nepal more difficult.

China’s position in Bangladesh is entrenched. Even the friendly government of Sheikha Hasina would see it in its interest to maintain close ties with China for the many benefits it can derive from that, including giving India an incentive to woo Bangladesh more. China has earned the gratitude of the Sri Lankan government by supplying it arms that helped in defeating the LTTE militarily. Sri Lanka, along with Myanmar, Bangladesh and Maldives, are, in India’s eyes, targets for the naval ambitions of China in the Indian Ocean area to protect its vital lines of communication through these waters. The so-called “string of pearls” strategy involving construction of new port facilities in these countries may have commercial goals in view in the short term but is likely to have military goals in the longer term perspective, To promote these objectives China is bound to step up further its engagement with these countries, especially with increasing material means at its disposal, posing further challenges to India’s equities in its neighbourhood. India follows closely China’s initiatives in Sri Lanka on the political, economic and military front, including the visit in September of the Chinese Defence Minister to Sri Lanka, the first such visit ever. He seems to have emphasized that the Chinese Army’s efforts in conducting friendly exchanges and cooperation with its counterparts in the region are intended for maintaining regional security and stability and do not target any third party.

China has, of course, every right to take dispositions in the Indian Ocean area to protect its trade and energy flows. The countries with which China is cooperating are independent, sovereign countries and have economic and investment plans of their own to which China with its vast financial resources can contribute. Ultimately, for India’s neighbours, it is a question of political judgment how far they should be cognizant of India’s concerns and how to balance sometimes different pulls so that they do not become platforms for tensions because of the divergent interests of external partners.

One can broadly conclude that India will not be able to shape its immediate environment optimally for itself in the foreseeable future. Unless Pakistan is ready to genuinely end its politics of confrontation with India, an integral part of which is the over-assertion of its Islamic identity, its propagation of the jihadi mentality, its nurturing of extremist religious groups involved in terrorism, and the political domination of the military in the governance of the country, the SAARC region will remain under stress.

Afghanistan presents potential problems of a grave nature. If the extremist religious forces ultimately win there, the strategic space for these obscurantist elements will expand enormously, with the risk of a seriously adverse fall-out in the region that has either other Islamic countries or large populations of Muslim faith living in non-Muslim countries. A triumphant radical Islamic ideology can be destabilizing for the religiously composite societies of South Asia. Pressure on India from these forces would grow. The increasing Talibanisation of Pakistan would be most deleterious for the South Asian environment.

The prospects for a border settlement with China remain distant. China has, on the contrary, added to tensions by making aggressive claims on Arunachal Pradesh. India has been compelled to begin upgrading its military infrastructure in the north in the face of mounting Chinese intransigence on the border issue. With Chinese actions in the East China Sea and South China Sea, India has to be even more on the alert. The tactical alliance between India and China on climate change and WTO issues should not obscure the deeper sources of India-China problems. It must be said though that both sides have managed to prevent their differences from erupting into military confrontation. No bullet has actually been fired on the India-China border since 1967. China has become India’s biggest trade partner in goods, which is a remarkable development.

The political drift in Nepal portends continuing instability there with all its deleterious consequences for the economy. India has to play its role without getting embroiled in domestic controversies to the extent possible, though traditionally anti-Indian forces there would continue to propagate the canard of overbearing Indian interference in Nepal’s internal affairs. With the Sheikha Hasina government in power in Bangladesh India’s relations with that country seem set to improve. Bangladesh is showing an unprecedented willingness to deny safe havens to anti-India insurgents and discuss transit issues. If it opens up doors for Indian investments in the country the economic issues in the bilateral relationship can be addressed to mutual advantage. Bangladesh can play a positive part in linking the eastern region of South Asia to Myanmar, Thailand and beyond. A solution has to be found, however, to the problem of illegal Bangladeshi migration into India.

The commencement of a dialogue between the US and the Myanmar junta validates India’s policy towards that country. If the US has woken up to the danger of leaving China to consolidate its hold over Myanmar, it is all to the good. Here again, India cannot prevent Myanmar from developing close links with its neighbour China. How far it should move in that direction and lose its capacity to manoeuvre is for the Myanmar government to decide. So long as India-China relations are not normalized, India will always have concerns about strategic encirclement.

India’s very cordial relations with the Maldives need to nurtured, especial in view of the attention it is receiving from China at the highest level. The spreading piracy in the South Eastern Indian Ocean also makes Maldives more central in combatting this menace. Maldives is gripped with domestic political turmoil, placing India in a delicate position of being invited to intervene in favour of a duly elected government and hesitating to get embroiled in internal political rivalries.

Bhutan has been the only real success story in terms of India’s relations with its neighbours. Bhutan has border differences with China. It has kept its distance from Pakistan and the great powers as well, giving them little scope for interfering in its relations with India. This underscores the point that good relations between India and its neighbours depend not only on wise policies on our side, but, equally, the pursuit of wise policies by our partners.

Our relationship with Sri Lanka has been burdened in recent years by the Tamilian issue. We have handled it as well as we could from at our end. Despite the sensitivities in some quarters in Tamilnadu, we have supported Sri Lanka on the issue of terrorism. We have been both principled and practical.

As a neighbouring country we cannot ignore what is happening in Sri Lanka if developments here have a political impact in India. On the one hand, India must not intervene in Sri Lanka’s internal affairs; on the other, if they impact on India’s internal affairs, a case for a dialogue opens up with a view to helping find constructive solutions.

The nearly three-decade long armed conflict between Sri Lankan forces and the LTTE came to an end in May 2009. The armed conflict created a major humanitarian challenge, with nearly 300,000 Tamil civilians housed in camps for Internally Displaced Persons (IDPs). India has put in place a robust programme of assistance to help these IDPs return to normal life as quickly as possible.

India does reiterate at the highest levels the need for national reconciliation through a political settlement of the ethnic issue. The element of time is important. With three and a half years having elapsed since the military conflict issues got resolved, a solution to the political issues remains pending. Whether the level of statesmanship required to deal with complex issues in a longer term perspective will be forthcoming or whether shorter term calculations of political advantage will dictate policy remains to be seen. Democratic governments are always generous with their own people, and no polity can be stable without mutual trust between its various sections. This is the challenge Sri Lanka faces.