1 December 2014

Development as a people’s movement

December 1, 2014

Modern technology-based industries and services cannot generate employment on a massive scale. It is therefore imperative that this modern sector must rein in its adverse impacts on labour-intensive, natural resource-based livelihoods

Development was a key issue in the 2014 Lok Sabha election. In his very first speech after taking over as Prime Minister, Narendra Modi asserted that his government is committed to carrying on development as a people’s movement. This, he has asserted, will draw upon India’s democratic, demographic and demand dividends. But are we genuinely moving towards organising development as a people’s movement while building on these strengths?

At the heart of democracy is access to information. We do have the vital Right to Information Act, but need to do much more since the public is being continually misled. To reap the demographic dividend, our youth should be well nourished. But what is the reality? The government’s statistics show that 28 per cent of school children were malnourished in 1993; this came down to 17 per cent by 1999 and declined further to 8 per cent by 2006. However, this is based on information provided by schools, and many of them are guilty of maintaining bogus records of enrolment and expenses towards the provision of mid-day meals. As a cross-check, we have the data provided by the carefully and professionally conducted National Family Health Survey. According to its very different and shocking results, 53 per cent of school children were malnourished in 1993. This came down slightly to 47 per cent by 1999 and changed a little by 2006, to 46 per cent.

To cater to India’s massive population of consumers, people should have adequate purchasing power, such as that enjoyed by people employed in the industries or services sector. Unfortunately, as the malnourishment statistics indicate, a vast majority of Indians are poor, with barely 10 per cent employed in the organised sector. We are being convinced that vigorous economic growth is generating substantial employment. But this is not so. When our economy was growing at 3 per cent per year, employment in the organised sector was growing at 2 per cent per year. As the economy began to grow at 7-8 per cent per year, the rate of growth of employment in the organised sector actually declined to 1 per cent per year since most of the economic growth was based on technological progress, including automation. At the same time, the increasing pressure of the organised sector on land, water, forest and mineral resources has adversely impacted employment in farming, animal husbandry and fisheries sectors. People who are being pushed out of these occupations are now crowding in urban centres. This is in turn leading to a decline in the productivity of the organised industries and services sector. Evidently, the ship of our development is sadly adrift.

What is development?

An Indian Information Technology Service

December 1, 2014

The government would benefit from access to affordable talent and the dynamism of creative youth. Further, it would not need to upset the bureaucratic apple-cart.

The government should contemplate the establishment of an Indian information technology service. The raison d’etre is the prime minister’s vision of a digital India. The service should not be cadre-based a la the other all-India services, but similar to the short service commission of officers into the armed forces. Recruitment should be competitive and limited to recent graduates from technical institutes. The tenure of office should be limited to between, say, two to five years. Further, the PM should appoint a national technology advisor (like the national security advisor) to oversee and coordinate the progress of e-governance.

The government has long recognised the criticality of technology to improve the systems and processes of governance. Sam Pitroda was an early technology czar under Rajiv Gandhi, and Nandan Nilekani wore that hat during the UPA regime. Both made stellar contributions to e-governance. In addition, the UPA government had instituted a national e-governance plan in May 2006, and that umbrella housed 31 different technology missions. There is also the Department of Information Technology and Electronics, headed by a secretary to the government of India, the National Informatics Council, and the National Institute for Smart Government (NISG), each of which has the mandate to modernise governance. Also, several departments have their own IT policies, infrastructure and applications. For instance, the Indian Railways is the world’s largest e-commerce retailer and the two revenue boards, the CBDT and CBEC, have sophisticated IT systems supported by their own technical cadre.

Still, the culture of governance has not changed. Systems are not transparent. The time lags in the flows of information are long; there are continual turf battles between government departments; and the approval process remains cumbersome and subject to discretion. The reasons are several but seen through the lens of IT, they relate to the multiplicity of IT infrastructures and applications; the inability of government technocrats to keep pace with technological change and human resource systems that do not have the flexibility to attract relevant talent. If nothing else, this lack of progress on the modernisation of governance will make it difficult to deliver on the promise of “achhe din”.

The prime minister has pronounced in various capitals his government’s intent to improve “the ease of doing business” in India. His words have had some impact. The multinationals that had shelved plans related to India are dusting them off. The finance minister has also announced his intent to bring in a slew of “second-generation reforms”. The land acquisition bill will be simplified; labour laws will be reviewed; the GST will be implemented; the insurance amendment bill will be passed and natural resources will be allocated on a transparent and fair basis. He has also assured investors of contract and fiscal stability. These statements have had a markedly positive impact on business sentiment.

The other emerging player

Anita Inder Singh
China has announced that it will deepen its Afghan role

PRESIDENT Obama's decision that American troops in Afghanistan will engage in combat with the Taliban if necessary comes nearly two months after Washington signed the Bilateral Security Agreement (BSA) with the newly elected Afghan President Ashraf Ghani on September 30. Taliban violence has continued to rise and the Taliban have rejected Ghani's invitation for peace talks. 

Would a combat role for American troops dispel concerns (including in New Delhi) about the ability of Ghani's government to quash the Taliban? That is uncertain. There have been fears that the Afghan National Army (ANA) would not be able to resist the Taliban successfully without the American and Nato troops. 

According to the BSA, American forces can stay in Afghanistan 'until the end of 2024 and beyond', mostly in nine major land and air bases. But Washington's main intent has been that American troops train a 350,000-strong ANA. 

Afghanistan's weak economy will not be able to keep the country afloat, let alone defeat the Pakistan-backed Taliban insurgency. 

It was in this uncertain environment that Ghani made his first official trip abroad — to China — on October 29. The immediate occasion was the hosting by Beijing of its first international conference on Afghanistan. China then announced that it would deepen its Afghan role, that its aim was to advance the peaceful reconstruction of Afghanistan and to build a regional consensus on security and stability in Afghanistan. 

China has tried to revive the Istanbul Process, a regional cooperation mechanism designed to support 'a peaceful and stable Afghanistan'. Its 14-member countries include India, Pakistan, Russian, Saudi Arabia, Turkey, the United Arab Emirates and Central Asian states. This year’s conference was the first annual ministerial conference to be held in China, providing Beijing with a good opportunity to initiate or contribute to the shaping of Afghan security. 

That prospect was sought and welcomed by Ghani. Surrounded by Iran, Pakistan, China, Tajikistan, Turkmenistan and Uzbekistan, Afghanistan lives uneasily in a precarious strategic location. But it has vast mineral and gas reserves. Ghani hopes that a modernised Afghan infrastructure could transform his country into a regional land bridge. Afghanistan could then gain easy access to regional and global markets while collecting transit fees from commercial activities in Central and South Asia. 

China itself has good reasons to engage in Afghanistan. Afghanistan needs to be stabilised economically and also militarily — and it is in the economic and political spheres that China may be able to engage constructively. Like India, China will not deploy troops in Afghanistan. 

China has announced its support for infrastructure projects in that landlocked, war-torn, cash-strapped country. China has invested heavily in Afghanistan's copper reserves and oil fields. Interestingly, the state-steered Global Times declares that as China’s interests expand, it ‘cannot detach itself from dilemmas in international politics. This is the cost of being a major power and we need to get used to it.’ 

Problem of the past

December 1, 2014 

Tapan Raychaudhuri was born in 1926 to a landowning family in Barisal, Bangladesh. In the early years of his working life, he was director at the National Archives and taught at Delhi School of Economics. Later, he worked at Oxford and retired as professor in 1993.

Raychaudhuri is one of the most widely cited historians of India. He came to the field when some of the key debates in Indian history were taking shape — between the Cambridge school and the nationalists on the politics of colonial India, for example. He joined these debates. His criticisms were penetrating, constructive and acknowledged the strength of the opposition. But taken together, his published output does not represent any particular school of thought. His claim to intellectual eminence lies in the quality of his writings, which are marked by an elegance rare in academic history. He had great command over sources and made innovative use of them, especially in his little known first book, Bengal under Akbar and Jahangir (1953). And he wrote, in English and Bengali, with flair and a fine sense of humour.

Raychaudhuri was not a prolific writer by the standards of present-day academic professionals. But he produced works of lasting impact. Three of these works deserve particular mention. The book that brought him international recognition, Jan Company in Coromandel 1605-1690: A Study in the Interrelations of European Commerce and Traditional Economies (1962), was at one level a detailed study of the operation of the Dutch East India Company in India, and at another level, an argument that the Coromandel coast held a position of particular significance in the Indian Ocean trade of the 17th century. Later research on the Coromandel explored this significance, with attention to economic history, textile history and regional commerce. Raychaudhuri’s book is a pioneer in this scholarship.


Gwynne Dyer

This is what the former Ukrainian president, Viktor Yanukovych, subsequently driven from office by mass protests in Kiev, said to the German Chancellor, Angela Merkel at the start of the crisis. It was recorded by a Lithuanian television crew, eavesdropping on the conversation with a directional mike, at the European Union summit in Vilnius where Yanukovych announced that he was not going to sign an EU-Ukraine trade deal.

“The economic situation in Ukraine is very hard, and we have big difficulties with Moscow,” Yanukovych explained to Merkel in Russian (which they both speak fluently). “I would like you to hear me. I was left alone for three and a half years in very unequal conditions with Russia... one to one.”

The Ukrainian president was not overthrown by a “fascist” plot, as Russian propaganda would have us believe, nor was Nato hoping to make Ukraine a member. (Indeed, Nato had repeatedly told the previous Ukrainian government, which was very pro-Western, that under no circumstances could it ever join the Western alliance.) Exactly one year into the crisis, it’s useful to remember what really happened.

The basic question about any international crisis is: conspiracy or cock-up? The Ukrainian crisis definitely falls into the latter category. Nobody planned it, nobody wanted it. Here’s how they stumbled into it — Yanukovych inherited the negotiations for a trade deal with the EU from the previous government when he returned to the presidency in 2010. And he didn’t break off the talks with the EU because that would have alienated half the country: the western, mostly Ukrainian-speaking part.

Yanukovych was a typical post-Soviet political figure, deeply corrupt and almost comically greedy, but he was a competent politician. Almost all his votes had come from the eastern and southern, mostly Russian-speaking parts of the country, but he knew that he couldn’t simply ignore the west.

Original error

On the other hand, he couldn’t ignore Moscow either. Russia’s president, Vladimir Putin, saw the EU as a stalking horse for Nato, and was trying to persuade Yanukovych to join his “Eurasian Economic Union” (EEU) instead. Moreover, Russia had huge economic leverage, since it provided most of Ukraine’s energy and bought half of its exports.

Spiral of despair

Abbas Nasir
01 Dec 2014

Of all the pointless debates, the one currently engaging the attention and energy of a former and the incumbent interior minister must take the cake.

The two illustrious gentlemen have taken opposing public positions on whether the self-styled Islamic State has found a toehold in Pakistan with the incumbent insisting that no trace of the murderous entity is to be found on the country’s soil.

Of course, you could argue that discussing this isn’t pointless as the takfiri monster is one of the most potent, toxic and lethal threats to appear on the horizon of the Muslim world with the potential to not just destabilise the Middle East but cause murder and mayhem beyond too.

Its hate-filled ideology, mind-boggling brutality, access to oil revenue and other riches in parts of Syria and Iraq it has now under its control and rapid military advances have made it a magnet for extremist elements from around the world.

And like Al Qaida, it won’t take much to establish its franchise in Pakistan, given that the country’s environment appears already so conducive to violent manifestations of intolerant religious beliefs that extremists of every hue seem to thrive here.

Just look at some of the incidents of this week alone. There were indications that the polio immunisation programme of the World Health Organisation in Balochistan and Unicef’s field work in assistance of the provincial government were affected after four polio workers en route to vaccinate children were killed by unidentified gunmen.

Balochistan now represents such a mess that it is difficult to say who might have targeted the polio workers, though Jundullah has claimed responsibility. But, when for years the state doesn’t target Taliban-affiliated sectarian terrorists because it itself is accused of using such elements in its bloody fight with armed separatists, what else would one expect?

Then there was the news about a 26-year-old Christian cleaning lady in Sheikhupura, who reportedly had an argument with the women of the house she was working in. Two young men belonging to the same family beat her with a hosepipe, stripped her and left her in the street.


01 December 2014

The CBI still has a certain amount of credibility and the people do expect it to be fair and impartial. Ranjit Sinha’s successor should bear in mind the actions that have seriously harmed the probe agency's image

In a unique first-time move, on November 20, the Supreme Court ordered the Central Bureau of Investigation Director Ranjit Sinha to keep away from the investigation into the 2G Spectrum scam. This is because prima facie the court has found credible the charges against him that he had attempted to help the accused in the case and delay prosecution in the Aircel-Maxis case involving former Telecom Minister Dayanidhi Maran.

In a clear and unambiguous order, the Supreme Court said: “We direct the CBI Director not to interfere in the 2G scam investigation or prosecution. He will recuse himself from the case. The investigation team, constituted in the CBI to probe this case, will take over the handling of the case in place of present Director CBI who has only a few working days left for his retirement from the post… To protect the fair name of the CBI and to protect the reputation of the CBI Director, we are not giving elaborate reasons. Suffice it for us to observe that information furnished by the applicant (Centre for Public Interest Litigation) appears to be prima facie credible. So, it needs to be accepted. We reiterate that we are not giving elaborate reasons as the CBI has its own reputation and we don’t intend to tarnish it”.

Earlier, the apex court had appointed a Special Public Prosecutor who examined the evidence on Mr Sinha’s alleged misdeeds in the 2G case. He held that the evidence provided by the petitioner was credible. He slammed the CBI Director’s conduct and said that he could face criminal contempt for attempting to obstruct the administration of justice in the 2G case.

The Bench emphatically rejected Mr Sinha’s defence that he had done no wrong. “He is the head of the CBI. He should have the independence to take administrative decisions. All decisions taken were within the four corners of law and CBI manual”, argued the Director’s counsel.

Reportedly, two officials from a leading business house had visited Mr Sinha’s house several times, individually and collectively, every week between May 2013 and August of this year. The cars they used were registered to that firm. The frequency of their visits increased this year when Mr Sinha moved a proposal to re-investigate the case against two companies on the grounds that some new facts have come to light.

Rajya Sabha member KTS Tulsi, who was also a top law officer in the previous Government, said: “This is gross misconduct on part of the topmost official. There can’t be any justification for meetings between those against whom the agency had been conducting investigation and the CBI Director at his residence.”

Government plans to revive nuclear energy programme


Today's major developments. 

Photo Credit: Wikimedia Commons 

Centre looks to resolve concerns of equipment suppliers
The central government will look to revive India's nuclear energy programme by resolving the concerns among foreign and domestic equipment suppliers over the prospect of potentially ruinous payouts in the event of an accident, according to Hindustan Times. Despite signing a landmark deal with the United States in 2008, India's nuclear energy programme has remained at a standstill because equipment suppliers are not willing to risk liabilities. Under Indian law, besides the operator, suppliers are also liable if an accident occurs. Some of the steps that the government might take to address these concerns include, "setting up an insurance pool and fixing a limit on reactor components for the purpose of determining liability".

Mfg @ 0.1%! Make in India Needs Made in India Policy

By Shankkar Aiyar
30th November 2014 

0.1 %. It is the rate at which Indian manufacturing grew between July and September.

It is a reminder of a stark reality. A 5.3 per cent growth in GDP may satisfy some and look good. But fact is without a substantive improvement in manufacturing output, the promised high growth trajectory will elude India. It is a figure that must be pasted on bulletin boards in ministerial chambers and conference rooms of the many Bhavans. It is a reminder that the politics of procrastination must give way to politics of action, it is a post-it for this government that there is no escaping away from the hard calls that it must make if it intends to deliver on the promise of Achche Din.

One only has to look at the historical disaggregation of GDP to appreciate why manufacturing needs revival. In the three years India clocked 9-plus per cent GDP growth, industry grew at 9.7 per cent, 12.2 per cent and 9.7 per cent compared to 2.2 per cent now. And these rates are impossible to repeat without getting manufacturing back on track.

Yes. Manufacturing growth has been poor for over two years. Yes. Manufacturing growth has been sub-1 per cent in eight of the past 12 months. Yes. This is a crisis engineered by the clueless, paralysed, slothful, callous UPA regime. The fact of life, however, is one cannot choose siblings or parents—and one can blame our inheritance only in adolescence. The harsh truth is that the tried and tired spin of blame-the-UPA as a strategy is now past its sell-by date.

Sure, there is no doubting that Prime Minister Narendra Modi has taken the idea of ‘Make In India’ across the globe. But the idea of Make in India demands enabling policy Made in India. And unless his ministerial team translates working hours into actionable policy, the idea will remain an idea. This government is afflicted by what can only be described as “announcement-tis”. Keeping the people engaged and informed is necessary, but also critical is the expectation of movement. There is a distinct impression of motion—the clearance of some stalled projects—but little movement on the hardcore issues that have resulted in investment worth `18 lakh crore stuck between tables.

The imperative of reviving manufacturing does not call for a thesis in economics nor do the steps necessary demand yet another phase of conferences or committee raj. The milestones to be crossed for boosting manufacturing are essentially availability of land, environmental clearances, availability of power, dismantling of the tax pyramid and cost of capital. The first step to resolution is a change in mindset—the time for incrementalism is over. The solutions cannot and will not be led by risk-averse bureaucrats; the solutions will have to be innovative, political and risks will have to be taken by the political faces.

Pakistan-Iran Border Stress

There are tensions between the two neighbors. There need not be. 
By Aziz Muhammad Jawad
November 30, 2014

Pakistan and Iran are important neighbors on the rim of South Asia and the Middle East, with deep cultural, linguistic, religious and traditional ties. Recently, though, Iran has bolstered ties with India, engaging Indian military expertise in the development of a strategic road. The road connects Iran’s Chabahar sea port and Afghanistan at the border town of Zaranj, running very close to Pakistan’s border in the process. The presence of Indian element on its Balochistan border with Iran, unrest in its Balochistan province, and multiple claims of foreign interference in the internal security of that troubled province all add up to create a serious question mark over the future of security relations between Pakistan and Iran. 

Since the revolution, Iran has been unafraid to explore multiple avenues to fulfill its perceived security needs, including proxy, guerilla and urban warfare. From using Hezbollah against Israeli forces to supporting the Assad regime in Syria, Iranian policy has had an outsized role in the Middle Eastern security environment. Although few Pakistani security experts believe that Iranian Shia exposure can dislodge Sunni dominance in Pakistan, the Pakistani public is very aware of the curse of sectarian violence and many believe it is a result of foreign interference. 

Historically, Pakistan was among the first countries to recognize Iran’s revolutionary regime. Amazingly, the Zia regime – itself often considered the cause of much sectarian violence – not only accepted Iran’s revolution but also sent a high-level official delegation to endorse friendly relations with Iran. Pakistan banned many local anti-Shia militant organizations and was evenhanded in its approach to both Sunni and Shia militant organizations. Anti-Shia groups such as Sapah-e-Sahaba and Lashker-e-Jhangvi were banned and many of their operatives were detained in operations by Pakistani security forces. Anti-Sunni groups such as Sapah-e-Muhammad faced the same treatment. Both sides had been linked to assassinations and bombings. Neither Pakistan nor Iran ever allowed sectarian issues to disrupt their relations, even at the peak of sectarian Shia killings in Pakistan. 

In the wake of the A. Q. Khan revelations, Iran decided to seek nuclear technology from other sources, and Pakistan’s nuclear expertise lost its significance. Meanwhile, India began to develop closer relations with Iran. This led to a further cooling of ties between Iran and Pakistan. 

The Mirage of US-Pak Relations: Indian Façade

By Shreyas D Deshmukh
November 27, 2014  

In January 2014 US-Pak strategic dialogue resumed after a gap of three years. Then Pakistan National Security and Foreign Affairs advisor Sartaz Aziz remarked, “There’s a strong perception in Pakistan that a lot of pressure is exerted on Pakistan on issue of concern to India.”[i] Pakistan Army Chief Gen Raheel Sharif was in the US from 16 Nov 2014 for a week-long visit with a similar agenda on the table. The events of the last eleven months have changed the perception of Indian media and strategic community. It seems Indians are looking at the emerging US-Pak relations from Pakistani prism. It has come out recently, when the report on ‘Progress Towards Security and Stability in Afghanistan 2014’ was published by US Department of Defence (DOD), in which it has been mentioned that, “Afghan and Indian focused militants continue to operate from Pakistan territory to the detriment of Afghan and regional stability. Pakistan uses these proxy forces to hedge against the loss of influence in Afghanistan and to counter India’s superior military.”[ii] There has been a huge hue and cry in Pakistan on this report and subsequently the US ambassador was summoned; on the other side India applauded this report. This episode has been concluded as the shifting US stand over Pakistan and moving towards India. There are some other actions taken by US also leading towards this conclusion including overtly acknowledging Lashkar-e-Taiba’s (LeT) hand behind the attack on Indian Consulate in Herat, putting Jamat-ud-Dawa (JuD) in Black List [iii], supporting Indian developmental initiatives in Afghanistan and now the ongoing investigations against Robin Raphel.[iv] Are these events about Pakistan's apprehensions towards US-India relations related? If not, what are the milieu of these episodes and will there be any repercussions?

In 2012 a DOD report said, “Pakistan’s continued acceptance of sanctuaries for Afghan-focused insurgents […] continue to undermine the security of Afghanistan and pose an enduring threat to U.S., Coalition, and Afghan forces”.[v] A similar line appears in a report of 2013. The 2014 report only differs in terms of more critical words and admits that India centric terrorist groups also operate side by side with Afghan focused terrorist organizations. Further, the same report tries to naturalise Pakistan’s actions by acknowledging Indian influence in Afghanistan and says, “Although stability in Afghanistan is in the interest of Pakistan, Pakistan also seeks sufficient Pashtun representation in the Afghan government to prevent Pashtun discontent along the Afghan-Pakistan border and limit India’s influence.”[vi] Former Special Representative to Afghanistan and Pakistan (SRAP) James Dobbines has also avowed that “Pakistan’s concerns (about Indian Influence in Afghanistan) aren’t groundless. They are simply exaggerated.”[vii] Now just acknowledging it in this particular report that Pakistan is supporting these proxies doesn’t make any difference. It’s a fact recognised in other reports as well, like the 9/11 report explains where the State Department knowingly neglected this fact even when the Department’s acting counterterrorism coordinator advised Secretary Albright to designate Pakistan as a state sponsor of Terrorism.[viii]

Another welcome decision taken by US is Black Listing JuD, formerly known as LeT, in June 2014. This pronouncement came after the attack on Indian Consulate in Herat in May 2014. The US State department said that they had credible information about LeT’s hand behind this assault. Even then Indian analysts looked at it from the Pakistani perspective and thought the US was taking a pro-Indian stance while the JuD chief tweeted "US allegations and [their] timing are precisely due to 'strategic partnership' with India in Afghanistan; against Pakistan."[ix] In Dec 2008 the UN added four JuD leaders in the banned list including Hafeez Saeed. The US greeted this decision because these four leaders were already in the US Treasury Department Sanctions list[x]. But still JuD is functioning openly in Pakistan under a different banner called ‘Falah-e-Insaniyat Foundation’ and it has been allocated a fund of nearly PKR 60 million for a year by (Pakistan) Punjab government[xi]. They are operating Internally Displaced Person (IDP) camps for the people who are displaced because of on-going operation Zarb-e-Azb in North Waziristan Area (NWA) and recruiting people for radical activities from those camps.[xii]

Pakistani Shia cleric shot dead in Islamabad

29 Nov 2014 


The killing of Allama Nawaz Irfani shocked many and raised questions about the growing penetration of self-proclaimed jihadi groups in a city that is still considered to be the most secure in the country.

Pakistani soldiers search a house during a military operation against Taliban militants in North Waziristan. (Photo: AFP)

ISLAMABAD: The Haqqani Network achieved international notoriety using asymmetric warfare to fight against US-led NATO forces and the government of Afghanistan.

The group operates on both sides of the Afghanistan-Pakistan border, and US officials believe it is based in Pakistan's Waziristan tribal frontier.

A cleric, who accused the Pakistani military of resettling members of the Haqqani network before launching its military operation in North Waziristan, has been shot dead in Pakistan's capital Islamabad.

The killing of Allama Nawaz Irfani shocked many and raised questions about the growing penetration of self-proclaimed jihadi groups in a city that is still considered to be the most secure in the country.

Mr Irfani, in his 40s, had been a prominent Shia cleric from the Kurram Agency, a tribal region located right next to North Waziristan.

Chinese pressure blocked PM’s Lumbini visit


JAYADEVA RANADE New Delhi | 29th Nov 2014

Prime Minister Narendra Modi is welcomed by Nepal’s Deputy Prime Minister Bamdev Gautamon on his arrival at the international airport in Kathmandu, Nepal on Tuesday. | PTI

China's increasing influence over Nepal resulted in the derailing of Prime Minister Narendra Modi's trip to Lumbini during his visit to that country for the SAARC summit. Many political parties in Nepal, ostensibly prompted by domestic political considerations, opposed PM Modi's visit to the pilgrimage sites of Janakpur, Muktinath and Lumbini. In contrast, Sri Lankan President Mahinda Rajapakse travelled to Lumbini without a hitch. For many years, China's specific strategic focus has been on establishing a presence in Buddha's birthplace Lumbini and ensuring that Nepal is not used as a base to destabilise the Tibet Autonomous Region (TAR). Chinese government-sponsored NGOs have unveiled plans estimated at US$3 billion for the redevelopment of Lumbini, which include an airport and seminary-cum-monastery.

At least three Chinese government-sponsored NGOs are trying to establish a presence there for which they are co-opting prominent Nepal politicians. The Asia Pacific Exchange and Cooperation Foundation (APECF), promoted by the Chinese Communist Party's (CCP') United Front Work Department (UFWD), has appointed the chairman of the Unified Communist Party of Nepal (UCP-N) Pushpa Kamal Dahal, better known as Prachanda, as a vice president. It was during Prachanda's term as Prime Minister that Nepal forged very close ties with China. Prachanda broke with tradition and travelled to Beijing on his first visit abroad. Another Chinese government-sponsored NGO, the International Ecological Safety Collaborative Organisation (IESCO), appointed Madhav Kumar Nepal (CPN-UML) and Sujata Koirala (NC) as executive chairpersons.

How to keep future cold wars cold: Mind the missiles


Nuclear states China, India and Pakistan are not party to the web of treaties, as were the U.S. and USSR

Advanced technologies have the potential to offset or mitigate the strategic effects of nuclear weapons

India and Pakistan face more severe security challenges than those of the other nuclear weapon states 

At a time when we are reflecting on the lessons from the Cold War amid growing concern about the current U.S.-Russia relationship, we should be looking ahead to anticipate how changes in technology and geopolitics create new challenges to peace and stability among the world's major powers.

Changes in technology and geopolitics create new challenges to peace and stability among the world's major [nuclear] powers.- 

The Cold War stayed cold largely because the United States and the Soviet Union possessed nuclear weapons that raised the risk of an armed conflict between them to an unacceptable level. The destructiveness of nuclear weapons and the lack of effective defenses against them contributed to the strategic stability between the superpowers. Neither side had an incentive to strike first, and this calculation was unaffected by external shocks, false alarms or marginal shifts in the balance of power.

Since the end of the Cold War, three challenges to strategic stability have emerged. The first is the increasing complexity of deterrence relations among the nuclear weapon states. Whereas the first nuclear age was shaped by the bipolar global ideological and military competition between the United States and Soviet Union, the second nuclear age has been marked by the emergence of a multipolar nuclear order composed of states linked by varying levels of cooperation and conflict. Rising nuclear powers such as China, India and Pakistan are not party to the web of treaties, regimes and relationships that girded strategic stability between the United States and Soviet Union (and now Russia).

Moreover, most nuclear weapon states face security threats from more than one source, which breeds a “security trilemma,” when actions taken by a state to defend itself against one state have the effect of making a third state feel insecure. As a result, changes in one state's nuclear posture can have a cascading effect on the other nuclear-armed states. The trilemma helps explain Russian and Chinese reactions to American missile defenses aimed at Iran and North Korea.

The second challenge is the emergence of a suite of advanced nonnuclear military technologies that have the potential to replicate, offset or mitigate the strategic effects of nuclear weapons. Missile defenses and long-range precision weapons, for example, reduce strategic stability by endangering the ability of nuclear-armed states to credibly threaten retaliation following a surprise attack. Anti-satellite weapons and cyberweapons pose threats to the integrity of early-warning and command-and-control systems.

SAARC losing its relevance

The Statesman 
30 Nov 2014 

When SAARC was formed in 1985, an international news agency described it as a union of the world’s seven poorest countries. It was formed with the main objective of tackling the social and economic challenges of the region collectively. Almost 30 years down the line, the SAARC has not made as much progress as envisaged.

Suggestions for a Free Trade Area, for setting up of a Customs Union and an Economic Union visualised some years ago at the SAARC summit have failed to exploit their potential as they are now overshadowed by the many other global forums such as G20 and BRICS as far as international economics is concerned. When some member countries were frustrated with the slow progress of SAARC, Bimstec came into being. But Bimstec too has become a victim of a slow regional approach. The major problem has been periodic conflicts between the two largest members of SAARC ~ India and Pakistan.

The 18th Saarc meeting in Kathmandu this week is a classic example of how the members are not able to come together on many issues including regional connectivity and trade-related matters. The theme for the summit was “deeper integration for peace and prosperity”, which highlights the issues of terrorism and national security faced by all members. The meeting was important because many countries within SAARC like India, the Maldives and Bangladesh have just gone through elections and have elected stable governments. This should have infused a new vitality to the grouping.

Overall, there were no major breakthroughs at the summit and no significant move on fighting terrorism, which was presented as a main concern by most of the SAARC leaders. Also, there were no important decisions on flow of investments and financial arrangements. High hopes were pinned on Prime Minister Narendra Modi to promote the agenda of increased connectivity but it became more of rhetoric than anything concrete when the summit talked of forming a regional economic community.

Mr Modi’s message to SAARC leaders on Wednesday was that he wants to strengthen regional ties through more trade and better connectivity. “As SAARC, we have failed to move with the speed that our people expect and want from us,” he argued. “Is it because we are stuck behind the walls of our differences and hesitant to move out of the shadows of the past?”

The summit failed largely due to the reluctance of Pakistan Prime Minister Nawaz Sharif to cooperate. The meeting was almost about to collapse as Pakistan was not willing to come on board on signing of the three agreements. The Indian and Pakistani premiers did not even acknowledge each other at the summit except a last minute handshake. The tension between India and Pakistan has cast a shadow on previous SAARC meetings too.

Mr Modi’s frustration came in his speech at the summit when he said, “The bonds will grow through SAARC or outside it. Among us or some of us. We can all choose our path to destinations. But when we join hands and walk in step, the path becomes easier, the journey quicker and destination closer.”

America's Next Big Challenge: Countering China’s Diplomatic Blitzkrieg


It is clear that China has combined proactive diplomacy with large-scale economic incentives to quell any regional backlash against its maritime assertiveness across the Western Pacific. What will Washington do? 

November 30, 2014 
Much to the delight of China, recent weeks have witnessed a dramatic reorientation in the Asian strategic landscape. Demonstrating sophisticated statecraft, Chinese president Xi Jinping astutely utilized the recently concluded Asia Pacific Economic Cooperation (APEC) summit to emphasize Beijing’s centrality to regional prosperity and stability. Xi rekindled communication channels with estranged neighbors such as Japan and Vietnam, exploring various mechanisms to de-escalate territorial tensions in the Western Pacific. The summit featured icy bilateral meetings between the Chinese leader (with a poker face) and his Japanese and Vietnamese counterparts, namely Prime Minister Shinzo Abe and President Truong Tan Sang. The meetings came on the heels of weeks of preparation by special envoys to facilitate a formal meeting between their respective heads of states. There was also an informal talk between Xi and his Filipino counterpart, Benigno Aquino, who welcomed his first direct contact with the Chinese president. 

There was a huge element of symbolism to the whole affair, and how the meetings were choreographed by Beijing and framed by the Chinese media. Xi, widely considered China’s first paramount leader in decades, acted like a benevolent Chinese emperor, receiving humbled emissaries seeking more stable ties with the Middle Kingdom. But the meeting with Abe was particularly awkward. Traditionally, Chinese leaders await their guests and warmly welcome them with smiles and handshakes. The Japanese leader, however, had to anxiously wait for his Chinese host at Beijing's Great Hall of the People, settling for no smiles and a cold handshake. It marked a huge departure from Abe’s very friendly, landmark meeting with Xi’s predecessor, Hu Jintao, back in 2006, when both sides fervently hailed a “turning point” in their bilateral relations. This time, Xi and Abe settled for expressing their mutual interest in preventing a military conflict, preserving high-stakes economic ties and reiterating their previous agreements, over the past four decades, on friendship and cooperation. Overall, however, the meeting was shrouded in strategic ambiguity: It isn’t clear whether there was any major compromise on bilateral differences, particularly on the Senkaku/Diaoyu islands dispute. 

The APEC summit served as Xi’s coming-out party, presenting himself as a global leader. He boldly projected China as the most consequential economic player in the Asia-Pacific theater, proposing an ambitious Free Trade Area of the Asia-Pacific (FTAAP), which, if implemented, would render the U.S.-proposed Trans-Pacific Partnership (TPP) free-trade agreement as superfluous. Immediately after the APEC summit, Chinese premier Li Keqiang followed suit, launching a charm-offensive during the Association of Southeast Asian Nations (ASEAN) summit in Myanmar. Proposing a “diamond decade” between China and its Southeast Asian neighbors, China dangled $20 billion in loans to the ASEAN, offered to host an ASEAN-China defense-ministers meeting, and proposed the establishment of an ASEAN-China defense hotline. Among other things, China’s recent diplomatic offensive seems to have blunted any efforts by rival claimant states to develop a unified position vis-à-vis Beijing’s maritime assertiveness across the Western Pacific. No wonder, there was hardly any serious effort by the ASEAN and rival claimant states—with the exception of the Philippines—to push for a binding Code of Conduct (CoC) in the South China Sea. China has reverted to its tried-and-tested economic statecraft, leveraging large-scale trade and investments schemes to divide and dominate its neighbors. 

China's Looming Water Shortage


Beyond pollution, water scarcity may be the most threatening environmental issue China faces today. 
November 30, 2014

The Diplomat has previously covered China’s water pollution crisis, with the Chinese government reporting that nearly 60 percent of China’s groundwater is polluted. But water scarcity, while obviously exacerbated by pollution, is also a severe problem for China, one that is tied up with complex questions about energy use, urbanization, and modernization. 

Water issues were highlighted recently by Premier Li Keqiang. He urged local governments to accelerate their work on dealing with water issues, from water conservation to water diversion projects. In a visit to China’s Ministry of Water Resources, Li suggested providing more government funding for these projects and better support in the form of favorable policies. Trying to sweeten the deal, Li said such projects would also help “stabilize economic growth” by raising employment and investment levels. 

Li’s personal attention to the matter emphasizes the urgency of addressing water issues in China, According to the World Bank, China has renewable internal freshwater resources of 2,071 cubic meters per capita, well above the UN definition of water scarcity as 1,000 cubic meters per person. But China’s water resources are not distributed equally. According to Choke Point: China, nearly 70 percent of water used in China goes to the agriculture sector, while 20 percent is used in the coal industry. Both of these industries – agriculture and coal – are concentrated in China’s north, which also happens to be an area of scarce rainfall, receiving only 20 percent of China’s total moisture. As a result, demand for water is outstripping supply. In northern China, the average water per capita is only around 200 cubic meters. In Beijing, consumption levels were 70 percent greater than the total water supply in 2012. 

As Li’s remarks indicated, the Chinese government is very aware of the problem and is taking concrete steps to solve it, both by increasing efficiency and decreasing water use. Still, Beijing is struggling to adapt to the central problem. Thanks to urbanization and modernization, China’s water consumption is growing (projected to reach 670 billion cubic meters a year in the early 2020s, according to Choke Point: China) even while its water resources are dwindling – down 13 percent since 2000. 

Can China Tap Private Sector Innovation in Defense?

November 28, 2014

The United States isn’t the only country looking to inject some civilian-sector innovation into defense technology. 

Early last week, the Pentagon announced a new initiative designed to broaden the defense industrial pool by appealing to smaller, non-traditional firms. This is hardly the first time that DoD has launched such an initiative; over the past decade and a half, the Pentagon has repeatedly made efforts to shift procurement dollars to firms not normally associated with defense technology. The DoD keeps trying to do this because it wants to capture some of the dynamism of the civilian tech economy, reduce costs for key technologies, and introduce additional competition to defense procurement. Rhetorically, proposing to “give the little guy a leg up” appeals to Congress and the media.

So why does the Pentagon keep having to launch these initiatives? They often don’t work, for several reasons.Traditional defense firms have spent a lot of time and money mastering the byzantine procurement process. Such firms usually have long-standing connections with the Pentagon, often hiring retired DoD civilians and former military officers. Finally, the Pentagon’s system of intellectual property management tends to scare away firms that want to maintain a foothold in the civilian market.

What’s interesting about this latest appeal is that it appears to come alongside a similar appeal from the Chinese military. The PLA has announced an effort to open multiple procurement projects up to civilian technology firms. The PLA’s language sounds remarkable similar to DoD’s: “The public procurements of 108 defense-purpose products is unprecedented in the history of development of the PLA, which will definitely be conducive to raising the effectiveness of military expenditures, optimizing military resource allocation, and boosting national defense modernization.”

President Xi Jinping Comes Calling-On

29 Nov , 2014

Narendra Modi and Chinese President Xi Jinping

At the Indian Council of World Affairs, the Chinese President hoped that China and India would be the ‘express trains’ driving regional development as well as the ‘twin anchors’ of regional peace. “When China and India join hands for cooperation, it will benefit not only the two countries but also the entire Asia and the world at large,” he said adding, “Nothing is more imperative than to deliver a more comfortable, more secure and happier life to the people.” Once again, the President’s words do not tally with the situation on the ground.

India and China wanted to show the world that the two most populated countries of the planet can work together harmoniously…

All started well when President Xi Jinping of China landed at the Sardar Vallabhbhai International Airport at Ahmedabad on September 17. He and Peng Liyuan, his beautiful wife (and renowned former Opera singer) had a taste of Modiland. They seemed to enjoy the dynamism and culture of Gujarat as well as its delicacies on the banks of a clean Sabarmati river.

Both India and China wanted to show the world that the two most populated countries of the planet can work together harmoniously. Modi Sarkar had done its homework by sending National Security Adviser, Ajit Doval to Beijing. After meeting President Xi, Doval told the Indian media that the bilateral relations were poised for an ‘orbital jump’. A good sound bite indeed!

The day he arrived, President Xi wrote an op-ed in The Hindu: “As the two engines of the Asian economy, we need to become cooperation partners spearheading growth. I believe that the combination of China’s energy plus India’s wisdom will release massive potential.”

China’s First Cold Snap Will Once Again Expose Serious Natural Gas Shortages and Drive Historically High LNG Import Demand


China’s weather so far in Fall 2014 has been relatively mild, in contrast to 2009 and 2013, when November cold waves prompted major gas shortages in much of Eastern and Central China.

The first cold snap this coming winter will very likely set the stage for another round of serious natural gas shortages in many parts of China. CNPC researchers estimate this winter’s gap between supply and demand could grow to 13.6 billion cubic meters—roughly twice as large as last winter’s gap and approximately 42% more gas than wasdelivered to the municipality of Beijing in the entire year of 2013.

Over the past seven years, China’s gas supply deficit has burgeoned dramatically, and as of June 2014, stood at nearly 45% (Exhibit 1). In recent months, domestic gas supply increases have tapered off and the supply deficit is now likely even more acute than it was during the summer, increasing China’s dependency on pipeline and LNG imports.

Exhibit 1: China Gas Supply Deficit
Shortfall as percentage of domestic production

Source: BP, NBS China, China SignPost™ analysis

This growing reliance poses challenges because import infrastructure is not optimized to respond to rapid demand spikes in China’s populous and increasingly gas-hungry central regions—especially Chongqing, Sichuan, Hubei, Hunan, and Anhui—where many gas demand centers cannot easily access “surge” gas supplies from seaborne LNG imports, the most responsive supply source when sudden demand spikes occur.

Tank Watch: What Do China’s November 2014 SPR Data Tell Us?


On November 20, China’s National Statistics Bureau unveiled a G-20 surprise by publishing inventory data for four of the country’s strategic petroleum reserve (SPR) sites: Dalian, Huangdao, Zhenhai, and Zhoushan. These four sites can store approximately 103 million barrels of crude combined. The reported crude inventory level on November 20 was 89.5 million barrels, yielding an average capacity utilization rate of just under 87%.

The capacity utilization by site varies, with Dalian at 82.8%, Huangdao at 89.4%, Zhenhai at 83.2%, and Zhoushan at 91.1%. These utilization rates are significantly lower than the U.S. SPR, which between January 2007 and the present has averaged a 97% capacity utilization rate and never dropped below 94% utilization (Exhibit 1).

Exhibit 1: China’s November 20, 2014 SPR Utilization Rates vs. US SPR Utilization Rates Since January 2007, % of total capacity in use

Source: DOE, EIA, NBS China, China SignPost™ analysis

We choose the U.S. as a basis for comparison because: (1) together with China, it constitutes the “G-2” of global oil consumption, (2) the U.S. now has decades of SPR management experience under its belt, and (3) the countries have different economic structures and geological characteristics (e.g., U.S. salt domes) that shape their SPR management approaches.

Mapping China’s Gas Pipeline Buildout: Follow Lights and Railroads

NOVEMBER 25TH, 2014 

China’s gas supply deficit continues to rise. It is being propelled by booming demand and slowing domestic gas production increases (the deficit was 45% of demand as of June 2014). Now looming on the horizon: a future of much greater Chinese gas import volumes. Pipelines from Central Asia, Myanmar, and perhaps Russia, as well as LNG terminals, will bring gas supplies into the Middle Kingdom. Once the gas enters China, internal trunk pipelines represent the primary mode of moving molecules to market. Thus far, China’s trunk gas pipelines clearly flow to the parts of the country with the most intense nighttime light emissions. After all, light emissions are a strong proxy for aggregate economic activity and energy consumption (Exhibit 1).

NSA Director: Yes, China Can Shut Down Our Power Grids

NOV. 20, 2014

Elise Amendola/APA National Grid crew member works on a power line in Revere, Massachusetts.

China and "one or two" other countries are capable of mounting cyberattacks that would shut down the electric grid and other critical systems in parts of the United States, according to Adm. Michael Rogers, director of the National Security Agency and head of U.S. Cyber Command.

The possibility of such cyberattacks by U.S. adversaries has been widely known, but never confirmed publicly by the nation's top cyber official.

At a hearing of the House intelligence committee, Rogers said U.S. adversaries are performing electronic "reconnaissance" on a regular basis so that they can be in a position to disrupt the industrial control systems that run everything from chemical facilities to water treatment plants.

"All of that leads me to believe it is only a matter of when, not if, we are going to see something dramatic," he said.

Outside experts say the U.S. Cyber Command also has the capability to hack into and damage critical infrastructure, which in theory should amount to mutual deterrence. But Rogers, who did not address his offensive cyber tools, said the nuclear deterrence model did not necessarily apply to cyberattacks.

Only a handful of countries had nuclear capability during the Cold War, he said, and nuclear attacks could be detected and attributed in time to retaliate.

By contrast, the source of a cyberattack can easily be disguised, and the capability do significant damage is possessed not only by nation states but by criminal groups and individuals, Rogers noted.

In cyberspace, "You can literally do almost anything you want, and there is not a price to pay for it," the NSA director said.

Roger's remarks about critical infrastructure attacks came in response to questioning from Republican Mike Rogers of Michigan, who chairs the intelligence committee. He asked the NSA director about a private report detailing China-based intrusions into the power grid and other critical systems that appeared to be precursors to attack. What other countries, the chairman wanted to know, have the capability?

"One or two others," the NSA director said, but he declined to name them, saying the information is classified. "We're watching multiple nation states invest in this capability."

China Terrorism Debate: Does the Internet Kill People?


WUZHEN, Nov. 19, 2014 Delegates attend the opening ceremony of the World Internet Conference in Wuzhen, east China’s Zhejiang Province, Nov. 19, 2014. Representatives from nearly 100 countries and regions took part in the three-day Internet conference. 

Zuma Press

China’s government says the dark side of the Internet was on full display in terror attacks over the past year — a train station knifing, a car that exploded near Beijing’s Tiananmen Gate and other attacks on civilians — because it has evidence such activity is planned online.

But when a key Chinese proponent of tougher laws to combat cyber-terrorism pushed that view on Thursday while showing video from the crime scenes at a forum called the World Internet Conference, he faced pushback from two American researchers.

“Cyber-terrorism is a sort of cancer on the Internet,” declared Gu Jianguo, who is China’s top policeman on cyber-crime as director of network protection at the Ministry of Public Security. “We are trying hard to elicit support of the international community.”

While condemning such attacks, not everyone agreed with Mr. Gu’s way of thinking about them. “There is very little cyber-war or cyber-terrorism,” said Bruce McConnell, a senior vice president at the EastWest Institute who formerly worked on such issues at the U.S. Department of Homeland Security. “Exaggerating the threat does not help defeat it.”

Peter Chalk, a senior political scientist at Rand Corp., said he agreed that the Internet is used for “enabling purposes” but not so far to actually carry out large-scale cyber-terrorism – like collapsing power systems – because it has proved too difficult.