The AAP promises

Results of Delhi’s assembly elections surprised many. Barely a year old, Aam Admi Party (Party of the common man) better known by its acronym AAP pulled a miracle. No other political movement in the history of India ever managed something like this. The party won 28 of the 70 seats, falling short of majority by just eight seats. The right wing Bharatiya Janata Party (BJP) managed 32 and the ruling Congress was decimated to just eight. With no party in a position to form the government Delhi will go for fresh polls, most likely together with Lok Sabha elections in April/May 2014.

AAP started with the agenda of getting India rid of the chronic corruption in the establishment. Arvind Kejriwal, an ex Indian Revenue Services (IRS) officer quit his job and became an activist. He later joined the massive anti corruption movement lead by Anna Hazare, a social activist in 2011. The youth of India rallied behind the movement, which forced the union government lead by Congress to introduce a hastily put together Lokpal bill (ombudsman bill) in the parliament. The bill was never passed and meanwhile Anna Hazare and Kejriwal parted ways to pursue their own path to fight corruption. AAP was born out of the anti corruption movement. Kejriwal had a bunch of likeminded people and they saw the anger in the youth. Kejriwal found his vote bank in the youth, cutting across religion and class. He created his campaign around the youth and mobilized them through the media they understand the best. Facebook, Twitter, blogs, online newspapers, etc were extensively used to spread the message. Newspaper reports suggest that a voluntary propaganda center in Bangalore made phone calls to people in Delhi to spread the AAP message.

The high level team of AAP has many brilliant minds. Kejriwal himself is well versed with the government finances due to his experience in the IRS. Prashant Bhushan a veteran Supreme Court lawyer, Yogendra Yadav a fantastic psephologist, Kumar Vishwas a professor of Hindi and Manish Sisodia a social activist. This group represents the emerging India, educated, aware and ready to fight for their rights. In November 2013 AAP released its manifesto in Hindi (read it in English), which talked about decentralizing governance. The main agenda was to bring down inflation and eradicate corruption. Apart from this they also took up issues like water, electricity, women’s security, garbage disposal, etc. Indian Affairs gave the manifesto a good read. Sadly it is no different from that of the traditional parties. It reads more like a communist manifesto, handing out doles to the public to keep them happy.

The first paragraph of the manifesto says that “Ruling parties make untruthful and exaggerated claims and election manifestos are a collection of false promises”. It’s ironic that these lines appear in their own manifesto. The first promise is that of a Jan lokpal bill for Delhi. The lokpal or the ombudsman will be omnipotent and corrupt officials will be swiftly prosecuted, convicted and their property confiscated. It however fails to inform how such huge machinery will be manned and financed.

I will rule, you take the accountability

The next promise is that of introducing the “swaraj bill” (self rule), which will eventually delegate power to grassroots level of “mohalla sabhas” or block committees in the city. It means that the government will wash their hands of all accountability and hold the block committees responsible for all that will go wrong. The model will hardly solve any problems and on the contrary will lead to higher level of corruption and log jams in decision making.

AAP promises a mind boggling 50% reduction in electricity bills. The two methods suggested include audit of the distribution companies to find out the actual cost of distribution and the second is to install solar panels on individual roof tops. People will also have the option to sell excess production to the grid. The real cost will be known only after the audit is done, we cannot assume that the companies are cheating until such audit is complete.

Alternate source of energy is a welcome move. It will reduce the carbon emission and reduce the dependence on traditional sources of energy. But the problem with solar energy is that it needs a large area (around 100 – 110 square meters) for installation. Most homes in Delhi do not have individual roof tops and those who have are small in sizes. The cost of installation even after the existing subsidies is high. It costs anything between INR 120,000 – 180,000 for a 1 KW system. A typical home needs 4 – 5 KW system to run the basic appliances like fans, lights, television sets, etc, costing more than five lakhs.

 The manifesto then goes on promising better sewage systems, clean drinking water and 700 liters of free water per day, etc. Anyone who has lived in Delhi would know that sewage and potable water is grossly mismanaged. The entire network is old and needs urgent repairs. This will cost a fortune and would be financed by the MCD (or the state government).

Education system will be changed to provide quality education. To this end AAP wants to improve the infrastructure and increase the number of schools (more spending for public good). While the infrastructure need is addressed there is no mention of how the quality will be improved. The accountability of schools is once again passed on to “abhibhavak sabha” or the parents’ council.

AAP also promised to create a “citizens’ security force” to protect women. They do not explain how this will be formed, will it have legal sanctions or will it be a private militia? How will it interact with the state police and who will spell out their scope of work? And finally who will finance the force?

Rest of the manifesto is nothing but populist socialist propaganda. Protecting labour laws, protecting minorities, no privatization, no FDI, etc. Like all traditional parties AAP also includes religion and language as issues towards the end of its manifesto.

All the promises made by AAP may have good intentions but it will be extremely expensive to fulfill them. The very vote bank that supports it today will have to pay for all these in form of increased taxes. These taxes will have to come from increased VAT, sales tax and tax on fuel. Exactly the things people were protesting against.

The most dangerous thing however is the extreme decentralization of governance. The city block councils have been given so much power and responsibilities that it will be impossible for them to get anything done. On the other hand it will pave the way for corruption because huge amounts of money to be paid to contractors will depend on a certificate from these councils. While the government will take credit of whatever goes right, the blame will be shifted to the city councils for everything that goes wrong.

Kejriwal might have borrowed his movement from Beppe Grillo of Italy who’s “movement five star” is the blue print for AAP, but the way he wants to govern is impractical and deceiving.

The Mars madness – What the world fails to recognise

Mars or morsel?

We will have to wait eleven more months to see whether the Mars orbiter is indeed a success. The orbiter is expected to enter Mars’ orbit on 24^th September 2014. Once there it will look for signs of life and presence of methane. But India is not the first country to send an interplanetary probe or to look for signs of life on Mars. We have ample information on what the Martian surface looks like and we know there are no sign of life and that human life is impossible in the present Martian atmosphere. Why then is the Indian government spending millions of dollars on a programme that is useless at best and fancy at worst? Why is the government not spending that money on two thirds of its population living under USD 2 a day?

These are the arguments that the international media picked up while reporting the launch on 5^th November. They reported the launch, termed it a success and then immediately threw in the figures of aid money India receives and millions that live in poverty. This in itself is not a bad thing. After all media is supposed to be neutral and question the establishment. However, it is interesting to see whether linking the space programme to poverty by international media is fair or not.

In the financial year 2013-14 the government of India is expected to spend USD 55 billion in food and fuel subsidies. Fifty five times the yearly amount spent on the entire space programme. The recently introduced Food Security Bill (though flawed) will inject another USD 20 billion a year. There are many other programmes introduced by both the central and state governments to eradicate poverty. Add to this a few more millions in farm subsidies and we are looking at a figure close to USD 100 billion, spent on welfare schemes. The anti lobbies will argue that despite all the money spent, little has been achieved. Indian Affair will agree. But the argument of not spending on poverty elevation does not hold true anymore. The real question is that of implementing these programmes transparently and passing the benefits to the needy.

The view from the tinted glasses

The low cost space ship

The debates on international media revolved around the imagined space race between India and China and the need for a poor country to embark upon a programme, which should ideally be carried out by the first world. The Express News of the UK carried a headline, which read, “India sends a spaceship to Mars after UK government gives GBP 280 million in aid” implying that India used the aid money to fund its space programme. The German Sued Deutsche Zeitung (South German Newspaper) carried a story titled “India sends probe to Mars”. It started off well but towards the end it too succumbed to the temptation to highlighting “poverty” and “wasteful” expenditure on an expensive project. The American CNN and the British BBC were no exception. The media and public in west and especially the UK (if one reads through the comments section of various British news sites) see the launch as a fancy project. 

Almost everybody in the mainstream media of west acknowledged the fact that India carried out the mission at one tenth of the cost of a similar venture, MAVEN, by NASA (scheduled to be launched on 18^th November). What no one discussed was the mind boggling cost reduction by the Indian scientists. It is no mean feat to cut cost to a tenth for an interplanetary probe. This should have been the topic of discussion on the television debates. Curious minds should have called in astronauts and space scientists to discuss the frugal engineering by Indian scientists and how rest of the world can learn from them. They should have asked questions on future of space exploration industry and India’s role in it. They should have discussed the difficult scenario where India and China will dominate the high tech space industry, leaving the conventional pioneers behind. But they chose to ignore it and discussed poverty.

Not just a fancy toy

India’s space programme is anything but fancy. Ever since India sent its first satellite in space in 1975, Indian Space Research Organisation (ISRO) has conducted 72 launches from various launch locations in India and abroad. Over the years ISRO has helped India in telecommunication, broadcasting, weather forecasting, remote sensing, etc. The billion dollars a year that India spends on its space programme is paid at least a few times over by selling the services of its satellites to various users in India and abroad. India has also mastered the technique of sending multiple satellites into space from a single launch vehicle. The first successful launch was carried out in 1999 on board Polar Satellite Launch Vehicle (PSLV). The PSLV placed three satellites, the Indian Oceansat-I, the German DLR-Tubsat and the Korean KITSAT-3 in their respective orbits. ISRO has carried out a dozen successful multiple launches since then. The next step for ISRO will be to tap into the USD 340 billion space exploration market.

Poverty reduction should obviously be on India’s priority as a developing nation. It should take sincere steps to eradicate poverty and pull its millions out of the misery they live in today. And the problem is definitely not money. It all boils down to honestly implementing such programmes. But that is a different debate. It is surprising that the world media missed to discuss the obvious but chose to go the extra mile to ridicule a brilliant scientific achievement. We will never know whether it is a product of a prejudiced mind or fear of being left behind.

   

Great Expectations

If the next Lok Sabha elections are held on social media, Narendra Modi (Prime ministerial candidate of the opposition) will probably win hands down. In the past few months there have been various opinion polls suggesting that Modi leads his closest rival, Rahul Gandhi (heir of the ruling Congress party) by several miles when it comes to the choice of next prime minister of India. The Business Standard ran an article on September 12, 2013, summarizing the trends of seven opinion polls conducted in the recent past. According to the article, two clear trends emerge from the findings. First is the rise of Bharatiya Janata Party (BJP, right of centre) and National Democratic Alliance (BJP and its allies) as the single largest party and pre poll alliance respectively. Second is, huge losses for Congress (between 75 to 90 seats). What will actually happen in 2014 is anybody’s guess, but BJP is definitely enjoying high approval ratings in almost a decade. Social media and other internet platforms are inundated with pro Modi and pro BJP comments, sometimes even bordering jingoism. On the other hand Congress supporters seem to struggle a lot in defending the indefensible series of scandals and poor governance.  

Outside the social media, the recent public speeches by Modi in various Indian cities have demonstrated his popularity among a large section of urban and semi urban population too (in some cases people paid to attend his public rallies). He seems to have the backing of the middle class. Though there are no clear polls suggesting Modi’s popularity among the rural voters, it can be assumed (based on the other surveys conducted on random samples) that he has some support in the rural constituencies too. Now let us imagine a scenario where Modi is indeed chosen as the next prime minister of India. What should the voters expect from him?

I have an idea, or two

If one reads through the comments on major news paper websites, one thing that catches the attention is the expectation people have from Modi. From rising onion prices to the latest scandal, violation of cease fire on the Line of Control with Pakistan to Tamil fishermen being arrested by Sri Lankan navy, Narendra Modi seems to be the answer to every single problem the urban internet users face. For the ears of BJP and Modi this might be the best music they heard in a while. But let us not forget that it was the same group of middle class, Internet using Indians who marched the streets of Delhi and other cities in support of the anti corruption movement headed by Anna Hazare, it was the same middle class which once again took to the streets to protest against the rape and subsequent death of a student in Delhi. Such was the force of Indian middle class that the government was forced to give in and discuss changes in legislation well into the night.

In the past there have been no attempts from either the BJP or Modi to tone down the expectations people have from them in the next government. This probably suits them well for the time being. But with so much that is wrong with the economy, governance, public health, law and order, etc it will probably take more than just five years to show visible improvement. It takes years for the economy to show any sign of growth after a few bad years. The American economy despite the quantitative easing took almost five years to recover and things are still not the same as they used to. Any improvement in governance might require constitutional amendments. This means long negotiations with the opposition and possibility of a deadlock. These issues are just the tip of the iceberg. The real problems might be worse.

Modi should come up with a separate strategy to manage the expectations people have from him. The middle class, who today is willing to put him on the pedestal, will not hesitate to pull him down if he does not meet their expectations.  

Neither food nor security

India is the second largest, fast growing, large economy in the world. It is also has the second largest population in the world. India is home to 1.2 billion (and counting) people. For the sake of comparison we can say that India hosts a bit more than the total population of Africa on little less than one tenth of its size. Catering to such a huge population is a daunting task, especially when it comes to feeding it. Fortunately India is blessed with large and fertile plains fed by perennial rivers and an annual cycle of monsoon.

The land of surplus

In the year 2011-12, India produced a total of 246.2 million tons of food grain (rice, wheat and coarse grains). The census of India carried out in 2011 is yet to throw up details regarding household numbers and the average household size. But according to the census carried out in 2001 India had a total of 191.96 million households and the average household size was 5.3. The 2011 census tells us that India got an additional 181.96 million people in the decade since last census. Assuming an average household size of five the additional households would number 36.4 million, bringing the current number of households to approximately 228.5 million. A simple math will tell us that 246.2 million tons of food grain and 228.5 million households will leave a little more than a ton of food grain per household per year. The national sample survey organization reports that per capita food grain consumption in 2009-10 was roughly 11 Kg per month. The average household will hence consume 660 Kg a year, significantly less than the available and hence leaving a surplus for storage/exports.

Who moved my grains?

The interesting fact however is that 42% of India’s children are malnourished and 58% are stunted. These are alarming numbers, especially when India is a food surplus country. One might ask where all the food is going. Well, much of it just rots in the extreme weather. India made huge progress in food production but failed to create enough storage facilities. A Reuters report from July 2012 quotes that as much as 6 – 19 million tons of food might perish due to lack of proper storage.

Did you work out the freebies?

But that’s just half of the story. India for many decades has a system of “Public Distribution System” (PDS). A system under which heavily subsidies food grains is sold through licensed shops. Eligible families get 35 Kg of food grains a month, rice at Rs. 5.6 (USD 0.093) per Kg and wheat at Rs. 4.1 (USD 0.068) per Kg. Unfortunately the PDS is one of the most corrupt institutions in India. In certain states less than a quarter of the eligible families get their fair share of food. The rest is siphoned off and sold in open market at a premium. An ugly nexus of bureaucrats and private shop owners play the game with impunity.

The ruling UPA government has recently introduced an ordinance (pending a vote when the parliament meets later in July 2103) providing food security to almost two thirds of India’s population. The food security bill will provide additional five kilograms of food grain at prices lower than the PDS price. The scheme will cost the exchequer INR 125,000 crore (USD 20 billion) a year. This is all good, especially since India is gearing up for the national elections early next year. But the irony is that the government plans to implement food security through the same corrupt and inefficient PDS network. There won’t be any surprises if the additional food grain ends up in open market to be sold at a higher price like the rest of the PDS grains.

One step forward three steps back

The government recently introduced a futuristic programme. Households will get the subsidy on cooking gas directly into their bank account once they pay the market price at the time of purchase. This was termed direct cash transfer. It was supposed to be extended to all kinds of subsidies. The next step for the government should have been to extend the subsidy to food grains and eliminate the corrupt nexus of PDS. Supply of more food grains in the open market would have reduced the prices and the poor could have afforded a better choice in the open market. But the government decided to load the PDS with more grains. It is anybody’s guess what will happen to the extra 62 million tons of grains which will be pumped into the PDS.

Successive governments at both centre and the states have created a society, which lives off the freebies. Free food, free electricity, free television sets, free laptops, etc. have won many elections for the politicians. None of the governments think of long term investments for the overall development of the society. Investments in public infrastructure, education and health care are hardly seen.

The poor will get the benefits of food security bill only if the PDS is eliminated and new infrastructure for proper storage of food grains is created. Pouring more into a corrupt system will not help address the needs of the poor, nor will it send a positive signal to the voters. 

The case of Himalayan handshake and indispensable partnership

India engaged with the world’s second and third largest economies over the past two weeks. The Chinese premier Li Keqiang made his first stop in India on his four nation itinerary. The visit happened weeks after Chinese military pitched tents 19 km inside Indian territory in early April. The incident attracted international attention and set rolling diplomatic manoeuvres between India and China. The standoff was resolved just in time to salvage the state visit of External Affairs minister Salman Khurshid to China and recently concluded visit of Mr Li to India.

China’s relationship with India has not been smooth in the past decades. Much like China’s strained relationship with its other neighbours in South China Sea, its relationship with India is soured over a border dispute (both countries fought a brief war in 1962, which India lost). Despite the border issues and lack of mutual trust both countries do significant amount of trade between them. China is India’s largest trade partner with total trade in 2012 at USD 66 billion (a decline of 12% over 2011). While trade is a good sign of cooperation and stability between the two countries, the fundamentals of a lasting peaceful coexistence are missing. Both countries accuse each other of encircling eachother with strategic assets in its immediate neighbourhood. The long standing border dispute, one of the main reasons for lack of trust is not heading towards a solution. China and India are rapidly building up their military and naval powers much to the dislike of each other.

The hand across the Himalaya

Given the strained relationship of India and China the visit of premier Li should have been used to start a process of easing the tensions. Sadly the visit ended with lot of politically correct statements and eight uninspiring documents signed by the two sides. Of these eight documents only two were of any real value. The first is the work programmes of three working groups for services and trade promotion, economic and trade planning and trade statistical analysis. The second is sharing of information on Brahmaputra (a river in north eastern India, which originates in Tibet) during flood seasons. The other six documents deal with Kailash Mansarovar yatra (a Hindu pilgrimage in Himalayas now under Chinese control), meat quarantine, sewage treatment, irrigation, translation and publication of classical work and identifying sister cities. Mr Li however reiterated that the handshake across the Himalaya is now stronger than before. When two fastest growing emerging economies sign agreements on sewage treatment and meat quarantine it can hardly be seen as a handshake. It was more of a nodding from a distance than a real handshake.

The more interesting visit is however that of India’s prime minister Mr Manmohan Singh to Japan. Japan, like many other countries in the region shares an uneasy relationship with China which goes back to the days of imperialist Japan. On top of that both countries have seen loud sabre rattling over a group of uninhabited islands (Senkaku to Japanese and Diaoyu to Chinese) recently. In fact the situation there is much more volatile than that between India and China. The rise of Mr Shinzo Abe, a nationalist as the prime minister of Japan has made matters worse for China. He has taken an aggressive stand against the long stagnation of the economy and is projecting himself as a man who wants to restore the lost glory of Japan.

Lets do it together

At the end of the visit India and Japan agreed on various issues ranging from civil nuclear energy cooperation, possible technology transfer of an amphibious aircraft the US-2, funding for urban infrastructure, funding of Chennai – Bangalore industrial corridor, a high speed train between Mumbai and Ahmedabad, educational grants and so on. This kind of cooperation will have a long lasting impact on the bilateral relationship and will create opportunities for both countries in the near future. India with its growing economy and younger population is a large market for Japanese investments. 

At present Japan is the second largest foreign investor in China with a total investment of USD 70 billion. A survey by Japan export trading organisation last year showed that India is emerging as the most preferred alternative site for Japanese investment. Japanese companies are facing problems in China due to the political relations of the two countries. Industry experts say that even if a small fraction of the Japanese investment in China moves to India it will create many jobs and boost industrial production.

The difference between the two visits is stark. The Chinese visit can at best be considered as a step towards an attempt to forge good relationship. The Japanese visit on the other hand is graduation of a long relationship into that of a natural indispensible partnership.  

Elections next door

On Saturday the 11^th of May 2013, Pakistan for the first time in its history will vote to transfer power from one civilian government to the other. In the past six decades the country has never had a civilian government, which completed its term. Much of the time was spent by the army to introduce martial law and rule by decree. The army ceased to be looked as defenders of the frontiers; it was now saviour of the Pakistani people. The last popular army dictator was General Parvez Musharraf (he later resigned from the army and assumed the role of a civilian president). Democracy never really got a chance to take roots in Pakistan.

For the first time since Pakistan’s independence, things are looking bright and understandably so. The Pakistani media celebrated the successful completion of the full term of the parliament and hoped that it will now be a regular feature. In fact if this indeed becomes a regular feature, it will be beneficial for both Pakistan and its neighbours. A civilian government has different priorities and is more accommodating to public sentiments. The long rule of Generals has created an environment where Pakistan is projected as a victim of international conspiracy and constantly under existential threat (largely from India). Riding high on such imagined threat, the army managed to take control of almost one fifth (18%) of the total budget expenditure.

A civilian government is accountable to the people who voted it in (unlike a general who usually rules without any accountability and retires in a posh London or Dubai neighbourhood). The civilian government will also try to bring economic prosperity and sense of security to its people. Both are severely lacking in present day Pakistan, having said that it will be a tall order for any party which manages to form the government. Over the past decade or so, since the war on terror arrived in Pakistan, the country has been consumed in violence. Daily terror attacks, sectarian violence and political rivalry (called target killings) are no longer seen as something extraordinary. Billions of dollars of aid money (given by America in return of cooperation in the war on terror) has been siphoned off to secrete bank accounts or put to use in arming the forces. Little has reached the common man.

Over the years during its rule the army has managed to build a massive business empire of its own (The unending battle). The National Logistics Cell (NLC), the army owned trucking company is today the largest of its kind in Pakistan and has crushed private competition. Being a monopoly and a state enterprise the generals controlling the company have made sure that Pakistani railways is turned into an inefficient liability, making NLC more reliable. The various army business interests now work in absolute monopoly. For any civilian government to reverse the trend might mean risking another coup. But there are lessons to learn from. Turkey had a similar problem when the Generals there were powerful and controlled huge businesses. Today they are cut to size. The economic interest of the army is still high but is lower since its peak in pre Erdogan era. Pakistan can borrow a page from Turkey to tackle its own army.

Another challenge facing Pakistan is its political infighting and party rivalries. Target killings have become a routine in Karachi. Political parties formed on ethnic and linguistic basis fight turf wars and have turned pocket of Karachi into “no go” areas. The situation in Baluchistan is no better. A long running separatist insurgency has turned the gas rich province into a backward quarter of Pakistan. People are regularly kidnapped never to be seen again. Headless bodies later appear and identification becomes impossible. The central government seems indifferent to the situation there, though the Awami National Party from Baluchistan is an ally of the ruling Pakistan People’s Party. Amid such challenging environment the various strains of Taliban only add to the grief. The home grown terror organisations carry out suicide attacks on a regular basis, targeting political rallies, army garrisons, minority processions and their places of worship.

Changing all this and providing its people a better Pakistan to live will be a long drawn battle for the civilian government. The mess created in the last six decades cannot be sorted out in the next five years. Things that might accelerate the process of bringing back the country on track may include the following

• Tackling the terrorists in tribal areas before final pull out of NATO forces from Afghanistan
• Making peace with Afghanistan and helping it fight the terrorists on both sides of the Durand line
• Tackling the terrorist modules working against India in the Kashmir region
• Making peace with the Baluch insurgents and share the gas revenue with them

Majority of Pakistan’s problems will get sorted out if it manages to eliminate the terrorists on its soil. The next step will be to claim its share in the regional economy. With two giant economies in its neighbourhood, it will be foolish not to ride on their success. This will not happen overnight. But the election is a right step in that direction. 

Chinese tents in Ladakh - Back to the sixties?

On this day, fifty one years ago in the events leading up to the India – China war, the directorate of military operations proposed the use of air force to counter increasing Chinese presence along the McMahon line. The situation half a century hence is not as alarming but looks strikingly similar. Back then the Chinese disputed the border treaty and advanced into Ladakh. The five tents that the People’s Liberation Army (PLA) has pitched in the last two weeks is a reminder of the events of 1961. But much snow has melted since then on the Ladakh glaciers. The socio political situations in both India and China have changed. China is no longer the communist state it was in the 60s with a failed “Great Leap Forward”. India is no longer incapable of fighting a high altitude war. India and China trade goods worth USD 66 billion between them.

We don't crack jokes all the time

India’s external affairs minister Salman Khurshid is scheduled to visit Beijing on 9^th May 2013 and China’s Prime Minister Li Keqiang will visit India later this month. What is a bit difficult to understand is the fact that why China is engaging in aggressive military tactics at a time when high level political visits are on cards? This leaves us with another question, whether these actions are sanctioned by China’s high office in Beijing? Is PLA acting on its own interest by provoking tension (much like the Pakistani army does at times)? We might not get answers to any of these questions yet. Little information is flowing into public domain. Indian media has been reporting the events based on information obtained from unofficial sources (leaks from army establishments) and the government has been playing them down. Words like “localized”, “routine” and “acne” have been used to explain the latest events. On the other side of McMahon, there is hardly any information on the incident. The official news agency “Xinhua” does not give any information on the present situation. Few days ago it was reported that China has accepted the offer made by Prime Minister Manmohan Singh to resolve the border issue peacefully. In the meanwhile Indian media too has reduced its coverage on the subject.

Given the changing socio economic situations in both India and China and growing military strength, it is unlikely that any of the country would engage in a war. However, China has displayed expansionist behaviour in the past with many of its neighbours. The Senkaku/Diaoyu island standoffs are the latest in a long series. International pressure and domestic obligations will also play a role in avoiding any escalations. Having said that, it is now time for India to take concrete steps towards resolving its border disputes. After six decades of independence India has resolved only one of its border disputes (with Bangladesh). The Chinese leadership on the other hand is more interested in leaving the dispute to be resolved by a later generation, which will have wisdom.

Resolving its border dispute with its largest neighbour should not be left for a wiser generation. India needs to take on the issue seriously with China and set a long term timeline for the matter to be resolved. Let’s not forget that China has territorial disputes with almost all its neighbours (the most sensitive ones being in the South China Sea). It will be in the interest of both the countries to strike off the item off the list as soon as possible. As the saying goes, “good fences make good neighbours”. Its time India takes the first step. 

Lets strike

The country is gearing up for a two day general strike on 20^th and 21^st February. The strike is supported by 11 trade unions across the country including Centre of Indian Trade Unions (CITU), Indian National Trade Union Congress (INTUC) and Bhartiya Mazdoor Sangh (BMS). Interestingly the three unions, CITU, INTUC and BMS are affiliated to Communist Party of India (Marxist), the Congress (main party in the ruling coalition) and the Bhartiya Janta Party (the main opposition party in the federal parliament) respectively. These are fairly large organizations and have close to 22 million members between them. Such large numbers give their patron parties a large pool of people who can be mobilized in an organized manner to send a message to the opponents. In this case the opponent seems to be the establishment, the ruling parties in general. All 11 trade unions have more or less agreed on a common agenda for the two day strike action.

Their main demands are, containing price rise, creation of more jobs, enforcement of labour laws, social security for everyone, minimum wage of INR 10,000, stop divestment of Public Sector Undertakings (PSU) and transfer of all contract workers into permanent positions. What the unions are demanding is job guarantee and increase in salary. They are not the only ones who want that. Given a chance we all would like to have a permanent job from which no one can fire us. This seems to be a fair demand by the unions. The unions are implying that companies should not be able to hire and fire workers at will and that all employees should be on permanent rolls of the companies so that they can get the benefits like health insurance and pension. This too is a fair demand. Why should some people be deprived of employee benefits? But the unions are silent on what the workers are willing to do in return of the benefits they are seeking.

The present labour laws of India make it extremely difficult for companies to lay off workers during difficult times like an economic recession or due to financial problems of an individual organisation. That is one of the main reasons why companies put so much emphasis on hiring contract labour. This makes it easy for the company to downsize during tough times. However such an arrangement is bad for both the companies hiring contract labour and the people who are on contract rolls. The company does not see them as reliable resource and hence does not invest in skill enhancing training for them. Some companies have started using automation as a means to avoid labour issues, after all machines never go on strike. Such developments lead to growth without increase in employment levels (this is true for lot of Indian states). Worldwide it is established that labour laws, which discriminates against either the employee or the employer lead to decline of industrial output in the long run. Greece and Italy are prime examples of how protecting the labour force can be a major reason for financial crisis.

Kolkata, the strike capital of India

The unions are also demanding more job creation and a stop to divestment of PSUs. But there is a basic flaw in this demand which the unions are conveniently ignoring. Post independence India adopted a Soviet style economy with heavy industries under state control. All natural resources too were controlled by the government. A small section of business was left for the private sector, which too was taken away during the nationalization spree by Indira Gandhi and the socialist government following the 1977 movement. However, no significant growth occurred post ’77 and India slipped towards the Hindu rate of growth, eventually facing bankruptcy in early 90s. Kolkata was once the most industrialized city of India, drawing entrepreneurs from all across India. It was what Istanbul was to Europe, a trade hub and gateway. Thirty years of socialist rule successfully pulled it down to being the least attractive metros in India.

It is not just in India, worldwide experiences show that nationalization and state monopoly of business leads to poor service standards and death of innovation (Venezuela and Argentina). It stops the incentive to be creative and stifles the entrepreneurial spirit of people.

Instead of the impractical demands, the unions should take a pragmatic look at the problems faced by the labour force in India. If they want the share of the wealth, they should contribute equally towards creation of the wealth. What the unions should demand is equal opportunity employment, health insurance, training opportunities and family welfare (day care and schools). In return they should agree to flexibility in labour laws, productivity linked appraisals and acting in benefit of the labour force not to become an arm of political parties. The unions should demand a consultation process of labour law reforms before the government unilaterally decides the fate of millions of workers across the country. The unions should demand to bring the unorganized sector under the umbrella of organized industry so that the people engaged there can reap the benefits and contribute their share towards the growth. Hammer and sickle lost their importance in the twentieth century, it is time for the unions to talk to the government and businesses as partners in growth not as a victim and tormentor. 

The unending battle

At the stroke of the midnight hour when the world was sleeping, India was divided into two countries based on religion. What followed was an orgy of hate, riots, arson, rape and murder. Communal tensions started brewing much before the actual date of partition. The days following 15^th August were the most dreadful. An estimated 10 million people migrated between India and Pakistan (many locked their homes believing they will return once the matter cools down) making it the largest mass migration in human history. The violence that engulfed large part of northern and eastern India during those few months lead to many deaths. Official records were scarce but estimates put the number to around a million. India and Pakistan never managed to reconcile.

Who can kick harder?

Four wars have been fought between India and Pakistan and border skirmishes are common. Though there is an agreed ceasefire between the two countries the troops regularly exchange fire. People to people contact on both sides of the border is scarce and there is a deep trust deficit. Regular export of terrorism by Pakistan since the early 90s has not helped the matter at all. The army of Pakistan which also acts as capitalist force (Pakistani armed force controls a USD 10 billion business empire manufacturing everything from fertilizers to breakfast cereals) has successfully managed to keep the fear psychosis alive in Pakistan. The defense budget of Pakistan for fiscal year 2012-13 is PKR 800 billion (USD 8.21 billion) 28% of the total budget spending.

The line between politics and armed forces in Pakistan is so blurred that the election commission wants the army to supervise the elections later this year. The election commission has also ordered verification of electoral rolls to be carried out under supervision of the army. No one knows for sure who between the army and the civilian government rules the state. This is one of the biggest problems when it comes to negotiating peace with Pakistan. The Pakistani army is interested in keeping the fire burning. If in the coming decades the relationship between India and Pakistan normalize there will be a heavy reduction in defense spending and the army will be sent back to the barracks. Obviously they do not want to be sidelined.

The civilian governments of Pakistan tried in the past to patch up with India (once even a general after staging a coup got talking to India) but their military always betrayed them. The recent violation of cease fire in Kashmir is one such example. Two Indian soldiers were killed and their bodies mutilated by the Pakistani troops in an ambush. Meanwhile Pakistan is claiming that Indian troops shot down one of their soldiers. Such news acts as fodder for the jingoists on both sides of the border. Many Indians want a “final” war on Pakistan, some want it to be nuked, some sane types prefer surgical strikes and almost every one firmly agrees that the government is spineless.

From similar experiences around the world we know that a “final” war does not exist, nukes are at best deterrents and military strikes have not wiped out Taliban in Afghanistan even after ten years. Is there a solution to this unending battle? No one knows. There will have to be many changes on both sides of the border. More on the Pakistani side than on the Indian. Political situation in Pakistan has to stabilize, its home grown and military financed terror networks have to be disbanded and honest textbooks should replace the present anti India ones. All this might never happen or at best take many decades. India cannot and should not wait for the right moment to arrive.

India is yet to harness its growing power on the international high table. Ministry of external affair finds it difficult to manage the various stakeholders at once. Severe staff shortage and misplaced foreign policies have made India a dwarf in the international arena. Till 9/11 the western world saw the India – Pakistan relationship from the Pakistani point of view. Aggressive diplomacy and friendly relationship with the US helped Pakistan a lot. India’s repeated allegation of state sponsored terrorism by Pakistan fell on deaf ears.

With no solution in sight, India should embark upon a two prong long term strategy. First is to engage into aggressive diplomacy and second to engage with Pakistan at multiple levels. The international community has finally recognized the issue of Pakistan and its terror networks. Post 2014 when the American forces move out the interest in Pakistan too will diminish. India should be worried about such a situation. This is the time when it should engage in a high level dialogue with not just America but also with other stakeholders like China and Turkey. India should also turn out as a matured democracy in the UN. As an aspirant of a permanent seat on the Security Council it should demonstrate its willingness to engage in world matters than abstaining on matters of world interest in a vote.

Engagement with Pakistan is a necessity. One cannot wish away its neighbours. The current level of engagement is a good step forward. But this can only happen if Pakistan plays ball.