The Kashmir factor in UK–India relations

Since the revocation of Articles 370 and 35A by India in August 2019, the Kashmir issue has become an obstacle in India–UK relations. Rahul Roy-Chaudhury explains how the new UK government could provide opportunities to ‘de-hyphentate’ relations between India and Pakistan.
 
Despite the many strengths of the UK-India bilateral relationship, there remains an ‘elephant in the room’ – the Pakistan/Kashmir issue. The Indian security establishment perceives the UK government as favouring Pakistan diplomatically and being critical of India’s governance over Jammu & Kashmir. But, the UK government denies such a bias and maintains that Kashmir is a bilateral dispute between India and Pakistan. Crucially, Boris Johnson’s new post-Brexit government could seek to further ‘de-hyphenate’ its India-Pakistan relationship. On 6 February, it announced that Sir Philip Barton will be the next British High Commissioner to India; as the first British High Commissioner to have served earlier in India, Sir Philip takes up this appointment with considerable experience on security issues.
 
Kashmir in the UN Security Council
 
On 16 August 2019, China made the first of three attempts in the UNSC to criticise India’s controversial decision of 5 August 2019 to revoke Articles 370 and 35A of the Indian Constitution and end the semi-autonomous special status of Jammu and Kashmir and merge it fully into the Indian Union as two union territories. It is alleged that the UK supported China (and Pakistan) in calling for such an informal session as well as supporting a formal UNSC statement. Although the British High Commission in New Delhi formally denied both these allegations, Indian security officials remain unconvinced. In the event, an informal closed session on Kashmir took place in the UNSC for the first time in nearly 50 years, but failed to come up with a joint statement to the press; the Chinese and Pakistani envoys subsequently briefed the media.
 
However, in December, another Chinese attempt to discuss Kashmir at the UNSC was foiled by the UK, along with the US, France and Russia. Although a discussion on Kashmir took place in the UNSC in mid-January 2020, the UK, along with the US, Germany and France, made it clear that the UNSC was not the forum to raise the Kashmir dispute, which was a bilateral matter for India and Pakistan to resolve.
 
The Indian foreign policy establishment also perceives UK parliamentary debates on Kashmir, most recently in September 2019 and January 2020, as a ‘victory’ for Pakistan in a classic ‘zero-sum’ game. But, this should not be seen to be the case; British MPs of diverse ethnic origins represent diverse political causes for their constituents, without any official UK government endorsement.
 
More important are the official UK statements made during these debates. On 10 February 2020, for example, Heather Wheeler MP, Parliamentary Under Secretary of State (Minister for Asia and the Pacific), stated: “HMG’s longstanding position is that it is for India and Pakistan to find a lasting political resolution on Kashmir, taking into account the wishes of the Kashmiri people…it is not for the UK to prescribe a solution or to act as a mediator”.
 
At the same time, the UK continues to raise concerns over the human rights situation across India, including calling for ongoing restrictions and detentions in Jammu and Kashmir to be lifted as soon as possible. One can assume there is also private official UK concern over the protests taking place in India over the Citizenship Amendment Act (CAA) and the National Register of Citizens (NRC), and their implications for India as a democratic and secular state.
 
The Pakistan factor
 
The Indian security establishment remains concerned of the series of anti-India protests by Sikh and Kashmiri separatist groups that have taken place recently in London (including the violent anti-India demonstrations outside the Indian High Commission on 15 August and 3 September 2019). But, the UK continues to support India in calling for Pakistan to bring the perpetrators of the 2008 Mumbai terror attack to justice; to take decisive and concerted actions against Pakistan-based terror outfits including the Lashkar-e-Taiba (LeT) and the Jaish-e-Mohammed (JeM); and in May 2019, the UK, along with the US and France, successfully co-sponsored a resolution in the UN to declare JeM leader Masood Azhar as a “global terrorist.”
 
Although the Indian security establishment believes the UK could do far more than it is currently doing to curb cross-border terrorism against India emanating from Pakistan, the UK feels Indian perceptions of its influence over the Pakistan army and its Inter-Services Intelligence (ISI) are exaggerated. Notably, the official Pakistani narrative is that the UK has a distinct ‘pro-India bias,’ as it has not been sufficiently critical of India’s actions on Kashmir, post 5 August.
 
‘De-hyphenated’ relationship
 
The UK’s ‘enhanced strategic dialogue’ with Pakistan will continue to focus on intelligence sharing, security and military cooperation, stability in Afghanistan and trade relations, keeping in view the influence and impact of the 1.5-million Pakistani-origin diaspora (now, reportedly, nearly as large as the India-origin diaspora) on UK domestic politics. The UK will also remain a ‘safe haven’ for Pakistani political leaders of all hues.
 
At the same time, India has a much larger multi-faceted and multi-stakeholder relationship with the UK focusing on trade and investment, Indian-origin diaspora and cultural relations, technology, and security and defence. In view of the unique opportunities and advantages for India in its relations with the UK post Brexit, including on a future trade deal, it would be short-sighted for New Delhi to perceive the UK’s relations with Pakistan on an emotional basis, or indeed, as a ‘zero-sum’ game for India. Indeed, pragmatically, these do not directly affect India’s security, even though they may not always be aligned with India’s immediate interests (as in Afghanistan).
 
Moreover, Boris Johnson’s new post-Brexit government could provide further opportunities to ‘de-hyphenate’ relations between India and Pakistan. It will also be far less influenced by the traditional Labour-leading Pakistan-origin diaspora. Moreover, two of its top three Cabinet posts are held by British Indians, Rishi Sunak as Chancellor of the Exchequer and Priti Patel as Home Secretary; and four of seven Indian-origin Conservative party MPs are Cabinet Ministers/attend Cabinet meetings.
 
This commentary was originally published by the International Institute for Strategic Studies.
 
Rahul Roy-Chaudhury
March 11, 2020

source https://indiaoutbound.org/the-kashmir-factor-in-uk-india-relations/

India’s tryst with the startup ecosystem

Startups, both in India and other parts of the world, have attracted considerable traction over the last couple of decades. From government to academic institutions to media, all are overtly focused on startups and entrepreneurship. And for the right reasons, it seems. To lay credence to this is the fact that massive wealth creation happened in the ecosystem, with figures close to $2.8trillion in economic value. This is at par with a G7 economyand is bigger than the annual GDP of the United Kingdom.
 
Interestingly, the Indian startup space has evolved over the last two decades. While startups got conceived as early as 2000s, the ecosystem was nascent for a long time, as only a few investors were active and there existed only a handful of support organizations, including incubators and accelerators. But the last decade has witnessed significant activity on multiple fronts, including the setup of new startups, influx of global investors and capital inflows, development of regulatory infrastructure, global mergers, acquisitions and globalisation. As the vision for a $5trillion-dollar economy in India is laid out, it is amply evident that start-ups will be one of the strongest force-multipliers of this economy.
 
For instance, the recent Budget 2020 is replete with favourable instances and policies. Besides an adequate focus on developing the tech infrastructure, which saw investments in machine learning, artificial intelligence and quantum computing, the budget introduced measures aimed at mainstreaming the startup economy. Measures such as deferment of the tax incidence on the Employee Stock Options (ESOP), tax holiday on profits for startups, among others are welcome moves. Further, the fact that these measures are applicable for companies who qualify under section 80-IAC means that it will allow more startups to get incorporated, expand their operations, hire more talent and in turn boost employment prospects. Indiais already home to more than 40,000 startups and 33 unicorns and qualifies as the third largest market for startups.
 
Nevertheless, India’s policy approach does suffer from certain shortcomings. One,it mostly focuses on bringing more people into start-ups and in turn, encourages need-based rather than opportunity-based entrepreneurship. This translates into putting emphasis on self-employment rather than large and scalable ventures. As our policy prioritises on bringing in more ventures that are past the startup phase, they often fail to hit the spot due to lack of working capital and resources available to the startups.
 
Second, in general there exists an information asymmetry between the founders of startups and the customers for whom they aim to build products. Given the prevalence of different living environments in India, it is difficult to envisage a startup that would cater to a pan-India audience. Other significant challenges include certain regulatory hurdles and access to the market by startups.
 
A broader emphasis is often placed on innovation and developing R&D capacities. But, India still suffers from a maze of laws and regulations that stifle an entrepreneur’s options to start a business here. So, to foster the growth of startups, we need to comprehensively create a self-sustaining cluster of innovation economies, for instance, through the Smart City mission and innovation labs. Also, policy reforms that improve economic conditions as well as investments in physical and digital infrastructure are expected to benefit startups. Along with simplification of existing policies, the government should also aim to reduce structural inefficiencies and pave the development of the ecosystem.
 
With the proliferation of smartphones and technology and the prevalence of a rich demographic dividend, the opportunities in the startup space remain unparalleled. Another catalyst for innovation is urbanization. From a consumerist point of view, this creates a young middle-class with increased spending power and a heightened interest in digital innovation. The large diversity along with challenges in the social sphere such as education, health etc. makes a strong case for a rich economy of products and services. While the opportunities are immense, the challenges are many. Hence, the path to being a global player in technology and innovation would require a combination of government support, funding from both domestic and international firms to enhance India’s position in the startup space.
 
India Outbound
March 9, 2020

source https://indiaoutbound.org/indias-tryst-with-the-startup-ecosystem/

Woes of the Home Secretary Priti Patel

Lutyens London: A View from the Westminster Bubble

In an unprecedented move, the Permanent Secretary of the Home Office, Sir Philip Rutnam resigned last week making a statement to the BBC (right on time before the Sunday columnists finalised their pieces for the next day’s papers) accusing the Home Secretary Priti Patel of bullying and being abusive not only to him but also to the wider staff at the Home Office. Refusing a financial settlement from the Cabinet Office, Sir Philip will be taking the government to court citing “constructive dismissal.”
 
Since then, other reports of bullying by the Home Secretary in her previous stints as minister, in other government departments have surfaced. Prime Minister Boris Johnson has backed his Home Secretary although he has instructed the Cabinet office to ascertain facts around the issues of ministerial misconduct. The Conservatives have rallied around the embattled Home Secretary, while the Labour party and other opposition parties along with the “left” media have already judged Priti Patel of being vicious and guilty.
 
However, there is a tinge of hypocrisy in how this is being played out in an openly partisan basis.
 
Usually, publications such as the Guardian and its columnists would throw in their support behind a non-public school-educated woman of colour, against the accusations of a public school and Oxbridge educated senior civil servant who is a Knight of the realm. However, Priti Patel is a Conservative Brexiteer and has no time to play the victim card of race or gender. Hence, she is ‘unworthy’ of the support from the liberal left. Dianne Abbott, the Shadow Home Secretary and other senior Labour figures have called for Patel’s removal from office. However, the conservatives have argued that mere allegations of this kind must not lead to a politician being removed from one of the great offices of the state.
 
This position exposes the Tories to criticisms of hypocrisy as well. The party’s opposition, which this columnist shares, to erstwhile Speaker of Commons John Bercow’s elevation to the House of Lords is supposedly based on the reports of bullying and abusing his staff. There are indeed serious allegations against the former Speaker, however, critics suggest that it was due to John Bercow’s role in blocking the expressed public will to exit the European Union in the last Parliament.
 
By all reports, Patel is a good Home Secretary focused on securing our borders and keeping our streets safe. She also enjoys the confidence of the Prime Minister and the Tory backbenches. However, bullying and abuse at the work place just as much as in the school playground are scourges that must be eradicated ruthlessly. Any minister facing those charges must be thoroughly investigated and if proven true should be sacked. Until then the minister in question must be allowed to serve the public, following the common legal maxim “innocent until proven guilty.”
 
That is exactly what Prime Minister Boris Johnson has done and it is time for all sides to respect the process and not prejudge the situation.
 
India Outbound
March 4, 2020
 
 

source https://indiaoutbound.org/woes-of-the-home-secretary-priti-patel/

The media: a ubiquitous threat to democracy

Proliferation of media has led to a manic outpour of news, that is more often than not, a quest for misconstrued or misrepresented versions of facts. The Oxford Dictionary defines “post truth” as the “public burial of objective facts by an avalanche of media appeals to emotion and personal belief.” Under the garb of Freedom of Speech and Expression, we are living in a warped version of a post-truth world today. Historically, media has been a great boon for society but in its current form, it is fast losing trust and credibility, a danger that can prove catastrophic for any democracy.
 
Edmund Burke, during a parliamentary debate in the House of Commons in 1787, claimed that those in the reporters’ gallery represented “the Fourth Estate.” Thus, Burke argued that the press was the most powerful of all the forces, driven by the compulsion of seeking the truth and nothing but the truth, underpinned by an ethos of public good. Historically, the press has functioned on the currency of “trust”, of the people it serves, for holding up a mirror to society, complete with all its warts, evils and fallacies as well as ensuring that the powerful are held accountable for their actions. More often than not, the press has done this right.
 
From the Pentagon Papers to the UK MPs expenses scandal and the Panama Papers lifting the lid on how the wealthy and powerful hide their money without paying taxes in off shore tax havens are all excellent examples of investigative journalism on a global scale. Aside from these global media powerhouses, there have been many unsung heroes from local papers and stations who have often challenged the power and unveiled atrocities of big business, politicos and bigots, despite being threatened or worse, killed. They have lived up to the best ideals of the Fourth Estate as the “force for good” that aims to improve lives and also strengthen democracy. Over the course of the 20th century, Burke’s prophecy has stood the test of time, with the information revolution and proliferation of technology, infusing an almost unparalleled power into organised media.
 
Lord Melbourne, the former British Prime Minister, in a debate in 1817, argued that “remind the conductors of the press of their duty to apply to themselves a maxim which they never neglected to urge on the consideration of government that the possession of great power necessarily implies great responsibility.”
 
As we embark on the second decade of the 21st century, it seems as if the leaders in the media industry have failed to live up to this maxim, be it Fox News, CNN, NDTV, Republic, The Economist or The Financial Times. Trust in the media is falling to a new low. Moreover, far too many people instinctively believe that the media, instead of being a defender against the post-truth world, has become an enabler and participant of old-fashioned lies, hot air talk, willful exaggerations, buffoonery, biased reporting, “alternative facts” and so on. Bluff and bluster hides from public attention issues that may be less “news-breaking.”
 
The Freedom of Speech and Expression, enshrined in most democratic constitutions worldwide, has been and is undoubtedly a cherished ideal in society. However, journalists have been using this democratic right pervasively to function as the world’s “judge, jury and executioner.” The President of the Republic India used these words in a recent speech and urged the media to be more responsible.
 
Interestingly, many journalists accept this reality of a crisis of trust. This perspective was best presented by Rajdeep Sardesai, a renowned journalist when he told the DW,”I think there is a credibility crisis, in that television news media in particular, is driven by a tendency to put sensation above sense in the search for ratings.” Similarly, on Fox News and CNN, we hear commentators and journalists alike call out exaggerations or willful misconstruction of the truth. However, these are not mea culpa moments. Instead, they only call out those who they believe do not share their “biases.”
 
Unfortunately, these incidents therefore exacerbate the lack of trust in the media in general, across the world’s two largest democracies and democratic societies elsewhere as well.They reinforce the idea that media is not as interested in pursuing facts, but keener about pushing particular narratives that suits its biases. The mediated to use the doctrines of “Freedom of Speech and Expression” to pursue ratings and their own agenda even if that means hurting or tarnishing the reputations of innocent individuals to harming national interests.
 
The issue of post-truth is not a Left Vs. Right issue. While politics and society have historically paid the price of misinformation and manipulation of fact, resulting in full-fledged wars as well, the phenomenon of post-truth today, has assumed disastrous proportions. The access to technology and information, supposed to prevent people from remaining oblivious to happenings in society, has made it close to impossible to discern fact from fiction. It has become dangerous to believe anything written or shown in the media.
 
That is inherently a clear and persistent danger to democracy.
 
Shamit Ghosh and Aditi Rukhaiyar
February 3, 2020

source https://indiaoutbound.org/the-media-a-ubiquitous-threat-to-democracy/

The Ideas For India conference: diverse conversations around India’s growth story

Bridge India, a London-based think tank, has conceptualised a unique Ideas For India conference. The inaugural three-day event will be held in London from April 22-24, 2020. Ideas For India will bring together business, policy and diaspora leaders from the UK, India and Europe, to collectively deliberate upon the next wave of India’s growth as a formidable global economy and nation.

Who is Bridge India?

Bridge India is a progressive and not-for-profit think tank, dedicated toward delving into public policy discourses for the betterment of India. Often, the “India Story” is presented through a narrow lens in the international community, with limited viewpoints on the business environment, economy or policy landscape. However, India’s massive scale and diversity renders it as a land of juxtapositions. Within this context, Bridge India seeks to highlight and celebrate this nuanced perspective, in order to facilitate a better understanding for the India-watchers.

A glimpse into the inaugural conference

The Ideas For India event is likely to bring afield 400+ attendees, including, 50+ foreign delegates and representatives from 10+ countries, across 12+ sessions, keynotes, panel discussions, focused roundtables and exclusive breakfast briefings, to curate and create a distinctive configuration of a million ideas for India.

Ideas For India has been designed in a manner that Day 1 will take place in the British Houses of Parliament; Day 2 will contain focused, parallel business and policy dialogue sessions; and Day 3 will include an all-day business conference followed by an invite-only black-tie dinner. A vast range of topics will be encapsulated across the various sessions to provide a 360-degree view of the India Story. Some of these relate to: India’s attractiveness as an investment destination, India’s energy security, fake news in India, artificial intelligence, data privacy and security, India’s position in the world, delivering for the bottom 90% of India, to list a few.

Some esteemed speakers who have confirmed their presence at the event include: Lord Karan Bilimoria (President, Confederation of British Industry), Mohandas Pai (Chairman, Manipal Global Education), Karan Thapar (TV news anchor), Nakul Saxena (Head of Policy, iSpirt Foundation), Sitaram Yechury (General Secretary, CPI (M)), Abhinandan Sekhri (CEO, Newslaundry), Dinesh Dhamija MEP (Chair of India Caucus, European Parliament), Siddarth Zarabi (Executive Editor, Business Television India) and Nitin Mantri (President, ICCO).

Rohini Lakhani, a team member of Bridge India said: “The event space in the UK-India corridor is a crowded one, but what is unique about Ideas For India is that it brings together senior stakeholders from business, policy, academia and elsewhere, not just from the bilateral corridor and on one side of the political spectrum, but in a genuinely diverse manner to explore collaboration opportunities between Europe and India, as well as globally. Our big focus will be to debate and discuss the big ideas that could drive India’s growth both as an economy and nation over the coming decades.”

According to Speaker Nakul Saxena, Director of Public Policy at iSPIRT Foundation, “The nature of growth in India is changing. Capital and access to the internet has disrupted business models in India, creating a virtuous cycle of growth for many of India’s tech startups. As India rebrands itself and evolves as an economy, technology, innovation, data privacy and related topics will be at the heart of this growth. I’m delighted to be able to contribute to such ideas for India at this conference.”

Pushparaj Deshpande, Director of the Samruddha Bharat Foundation opined that “The Indian diaspora has risen to the top of their professions globally and can contribute significantly to India’s growth as an economy as well as a heterogeneous democracy. I look forward to engaging in this unique forum to bring together leaders from just from India but globally, in a unique, diverse yet intimate forum.”

In order to convene and drive the debates and conversations across Europe and India, India Outbound has been brought on board as a media partner for the Ideas For India inaugural conference. All our partners have come together to ensure that this conference provides a unique, inclusive and focused forum and starts an annual conversation that yields invaluable insights into India’s current and future growth story.

For further information, please visit www.bridgeindia.org.uk/event/ideas-for-india-april-2020.

For details related to speakership, sponsorship, exhibition or any other event-related information, please email sanjana@bridgeindia.org.uk.

source https://indiaoutbound.org/the-ideas-for-india-conference-diverse-conversations-around-indias-growth-story/

Yes, Trump will possibly survive impeachment

The United States is currently in the middle of an upheaval. The chaotic aftermath of the US strike against Iran and a shock turn in President Donald trump’s impeachment drama are triggering a monumental Capitol Hill clash over trust and presidential power. Besides the raging uncertainty over the trial, the developments in the Middle East shifted the focus in Washington, even as Trump remains fixated as ever on the impeachment saga. He now faces a trial in the Senate, possibly in January, where he is likely to be acquitted in the Republican-controlled Senate.In theory, a two-thirds majority vote in the Senate would be required to convict Trump and remove him from office.
 
With no direct negotiations between the Senate leaders, combined with John R. Bolton’s (the former White House national security advisor) willingness to testify at Trump’s impeachment trial indeed puts a new face to the process. According to many, Bolton’s statement could spur a dramatic turn that could alter the political dynamic of the impeachment trial in the Senate where Trump’s presidency hangs in the balance. But that appears unlikely. First, given that Trump enjoys an 80% approval rate among Republicans, it is hard to see mass defections among the Senate Republicans. Further, the approval rate suggests that the Republicans will double-down on their far-right vision of America and stick with Trump, irrespective of the malfeasance that came to light.
 
Even the fact that opinion polls among people have fairly remained immobile signifies the growing inelasticity of American politics and demonstrates the support that Trump enjoys outside Congress. Consequently, on a purely tactical level this move,could actually end up enhancing his support base,instead of eroding it. All of these do indicate that there is no way to send Trump packing. But the fact that he is poised to win in 2020 and serve another four years, is what makes impeachment a warranted move.
 
In this regard, the Democrats have rightly sounded the bugle by holding an impeachment procedure against him. At the heart of Democrats case is the allegation that Trump tried to leverage a White House meeting and military aid, sought by Ukraine, to combat Russian military aggression, to pressure Ukrainian President Volody mr Zelensky to launch an investigation of former vice president Joe Biden and his son Hunter. Second, Trump also wanted Zelensky to investigate a debunked conspiracy theory, that Ukraine, not Russia, colluded with Democrats in the 2016 election. The premise on which the impeachment clause was included by James Madison and co. was to guard against the potential incapacity, negligence and perfidy of a President. Another dangerous possibility, according to them was that the “President might betray his trust to foreign powers.” Trump through all his high crimes and misdemeanors made his impeachment inevitable.
 
In all, impeachment nonetheless is a gamble for the Democrats as a full-blown trial distracts them from their core election agenda. But with the current dysfunction in American politics, impeachment almost becomes a shield against the dangers that a president like Trump poses. So even though impeachment might include partisanship, it ultimately asserts the supremacy of law in a political system.
 
India Outbound
January 9, 2019

source https://indiaoutbound.org/yes-trump-will-possibly-survive-impeachment/

End of the global trade order?

One of the pillars of the global trade order, the World Trade Organisation’s (WTO) dispute settlement system is set to collapse quietly this week. Though its demise may not make headlines akin to the US-China trade war, but its demise entails moving further away from multilateral rules, designed to promote global free trade and towards a law of the jungle where the mighty wins.
 
The collapse has been in the making for over two years, driven by a US blockade on appointments to the WTO’s highest court, the Appellate Body. In fact, U.S President Donald Trump has rallied against the WTO, calling it a catastrophe and a disaster, based on the assertion that the United States loses cases due to a skewed proportion and representation of Americans in the court. It is not unknown that Trump faces a barrage of disputes, at the WTO against his trade policies, including global tariffs on steel, and a tariff war with China with no end in sight.
 
Since he came to power, Washington has blocked all appointments to the appeals’ chamber as existing judges’ terms end. Such absence of new appointments, which can only occur by consensus of all WTO members in December, the appellate body will shrink to only one member out of its standard of seven, two less to form a quorum of three necessary to hear appeals and settle trade disputes. In a matter of months, their rotation will become meaningless, placing an impossible workload on the remaining members. The next vacancies for the US and Indian members occur in December 2019, at which point the appeals process would be crippled.
 
Essentially, what is at stake is a unique system that has on balance safeguarded the interests of all WTO members, regardless of their economic size or diplomatic influence. Governments must settle trade disputes through the dispute settlement system, if other diplomatic means are exhausted. The dispute settlement mechanism often referred to as the “crown jewel” of the WTO provides governments the right to appeal decisions and the right to withdraw trade concessions and raise tariffs in the event of an adverse funding. The international legitimacy of the WTO dispute settlement system makes it an indispensable tool that governments can use to hold trading partners accountable and without entering a retaliatory mechanism in tariff escalation in a bid to change behaviour.
 
Without a multilateral architecture to hold rule-breakers accountable, international economic relations would revert to the law of the jungle where countries with economic heft would rule the ground. That reversion definitely sits ill with multinational businesses, the global economic framework and the rule of law, thereby potentially jeopardizing international economic stability.
 
India Outbound
Nov 22, 2019
 
 

source https://indiaoutbound.org/end-of-the-global-trade-order/

The noble fight against poverty

The 2019 Nobel Prize in Economics to Abhijit Banerjee, Esther Duflo and Michael Kremer reaffirms the value of evidence-based policymaking in addressing intractable problems. Even as the pursuit of capital accumulation is underway in the international sphere, the world continues to be plagued with multiple distressing phenomena. Instances such as 700 million people trapped into poverty, or 50% children leaving schools without basic skills in literacy and numeracy are grim reminders of how policymaking at a macro-level could prove inadequate to address such crises.
 
Often, in instances such as global poverty, economists tend to rely on a macro-level understanding to alleviate poverty. Ideas related to immigration and economic growth are recognized as tools to improve the quality of life among the world’s poor. On the contrary, the relative narrowness of the scope of this year’s winner’s work is owed in part to their method of analysis. Mr. Banerjee and Ms. Duflo explicitly reject big thinking about big questions in their 2011 book “Poor Economics: A Radical Rethinking of the Way to Fight Global Poverty.”
 
What is unique about the duo’s work is the employability of the approach; Randomized Control Trial (RCT) has been the buzzword among development economists for almost two decades. Inspired by the impact of the RCTs in medical science, the trio has used this technique to test the effect of small interventions on individual behavior. Such trials involve selecting two sets of individuals at random, out of which one is then exposed to policy intervention. The experiment examines the impact of such interventions, often over long periods of time, to gauge the impact of policy and whether or not, it justifies the costs associated with it.
 
This has proven exemplary in areas such as education and healthcare. For instance, the Nobel Committee highlighted how their “experiment-based approach has transformed development economics over the past decades.” They specifically mentioned the result of one such randomized trial wherein “more than 5 million Indian children have benefited from programmes of remedial tutoring in schools.” Further, the results of another experiment suggest that multi-topic medical training of informal healthcare providers may offer an effective short-run strategy for improved healthcare.
 
Nonetheless, the effect of such rigour in policy analysis is considerable and as a consequence, the RCT approach has taken over the field of development economics. For Duflo and Banerjee, an important part of their work has been ensuring that the agency of the beneficiaries, usually in developing countries such as India, is put at the centre of any policy design. This is a crucial method in which experimental results often provide better outcome than large-scale data-based inference.
 
However, this approach is not without its critics. For instance, Angus Deaton, who won the 2015 Nobel prize in economics noted that while RCTs can play a role in building scientific knowledge, they can do so only as part of a cumulative program. While the approach has enamored a large number of development economists for its simplicity, where inferences of what works or not are drawn from field experiments, it has also been criticized for reducing the study of poverty to small interventions unconnected to the life experiences of the poor. But, despite the conditional nature of these studies, it is difficult to deny that policy interventions require better understanding to ensure efficient outcomes, especially in countries with finite state capacities. Thus, in a country like India, where billions in money goes into formulating policies to help the poor, which are often unaccompanied with the real scenario, such research can be enormously valuable in informing public debate and can thus aid in policy making.
 
India Outbound
october 24, 2019
 
 

source https://indiaoutbound.org/the-noble-fight-against-poverty/

Brexit, deal or no deal?

The fact that even a long gloomy night breaks into dawn is nothing short of a miracle. Although, the word miracle might not sound apt here, but the Brexit conundrum that has been lingering for more than three years seems to have made some sort of a breakthrough. After months of confusion, the negotiating teams of the United Kingdom and the European Union have reached a consensus on what could transpire as a no-deal Brexit if this gets approved. Both the British Prime Minister Boris Johnson and European Commission President Jean Claude-Juncker have announced their mutual agreement over the deal, where Juncker reportedly stated that it is a “fair and balanced agreement for the EU and the UK.”
 
The deal after the announcement still must clear several hurdles, including getting approval from Europe’s leaders and most crucially passage in the British Parliament, where an agreement reached by Johnson’s predecessor May suffered three successive defeats in the Parliament. The Brexit deal comes just ahead of the two-day EU summit starting Thursday and holds the possibility of removing some of the uncertainties that have dogged the EU-UK relationship since 2016.
 
However, the latest onslaught came from the Democratic Unionist Party (DUP) in Ireland who refused to support the deal as “things as stand.”Their concern is over the backstop arrangement, which if made redundant, would establish a hard border between the Northern Ireland (part of the UK) and the Republic of Ireland. Currently, there are no physical borders between the two parts. Johnson, a hard Eurosceptic in a sense, apparently junked the vexed backstop arrangement that had fluttered Brexiters all along. For Tories of that school, the purpose of Brexit is liberation from a regulatory yoke, imposed by the Brussels bureaucracy. Hatred of the backstop has its origin in the ambition to extricate the UK economy from the social protections preferred by many European countries. The theory is that a competitive edge is achieved by reducing the cost of doing business in Britain.
 
Mr. Johnson’s frantic rush to strike a Brexit bargain by October 31 has forced a focus on technicalities of withdrawal, but it also serves his agenda to distract his attention from the bigger picture. Largely, Johnson has portrayed himself as the man who would get Brexit done, a phrase he had often used as a weapon to stir the hysteria of Brexit and play down Theresa May’s deal.
 
But, it is important to remember that Brexit is not a game or a play to advance one man’s ambitions. Though Brexit was conceived and supported by the people who want the EU to fail, a government that seeks to uphold the notions of multilateralism will want the EU to survive. An outcome of the deal will shape the strategic direction of the country for generations and affect millions of livelihoods. What matters is for Johnson and his government to not play poker with the deal and strive towards an outcome that would co-opt both the UK and the EU in a favourable manner.

source https://indiaoutbound.org/brexit-deal-or-no-deal/

Why India needs a female boardroom revolution?

Over the years, the issue of gender diversity in business organizations has become particularly relevant in the international corporate governance arena. For proponents of more women to secure seats at the boardroom table, this marks a remarkable moment of the shattering of the glass ceiling. Here, the glass ceiling is used as a metaphor to represent an invisible barrier that prevents a given demography, in this case women, from rising beyond a certain level of hierarchy.
 
Research on gender diversity has often invoked sundry perspectives on how to efficiently solve problems that companies face. To this end, India had this epiphany only back in 2013 where the 2013 Companies Act made it mandatory for listed companies as well as companies with a turnover of INR 300 crore to appoint atleast one woman director. But often, companies would induct a women member from their promoter families to meet the requirement. This was largely tied to the objective of protecting business interests.
 
While this broadened women’s representation, this also led to a small cohort of women accumulating directorships. So, to ameliorate this concern and to make the boardroom truly diverse, in October 2017, Securities and Exchange Board of India (Sebi) mandated that there should be atleast one independent woman director in all listed companies.
 
Research evinces that companies with truly diverse boards perform better than their peers over a long period of time. So far, the legal provisions have managed to trigger off a right trend where according to Prime Database (which explored and analysed data for the boards of 500 top companies listed on the National Stock Exchange or Nifty500) found that female representation increased to 13.8 % in 2017, from 5% in 2012, indicating a 8.8% increase. However, the gain is not significant as per data shown by the 2019 edition of the Credit Suisse Gender 3000 report wherein Indian female representation in boardrooms has risen to 15.2% in 2019, falling below the global average of 20.6 %.
 
Apart from the normative argument that suggests both men and women should have an equal opportunity to attain leadership positions, what explains the logic of having a gender-diverse boardroom? Simply put, does investment in women actually translate to better financial results for firms? The broad answer is yes. There is a significant body of research, which suggests that gender diversity can have a positive impact on financial performance as well as brand perception.
 
Further research shows that companies with atleast one woman on board have a higher return on equity, higher earnings and stronger growth in stock price than companies with all-male boards. In fact, the evidence abounds. According to a research brief produced by Mckinsey, companies in the top quartile of gender diversity are 15% more likely to financially outperform those in the bottom quartile. Similarly, multiple surveys have also linked companies with more women on their boards to better corporate governance and more ethical behavior.
 
Meanwhile,another survey published in the International Journal of Business Governance and Ethics pointed out that firms with at least one woman on the board have a 20% lower risk of bankruptcy. These stark figures should in themselves serve as an incentive for businesses to see female representation as a commercial imperative.
 
The quota for female representation, albeit motivated by both ethical and social responsibility also produces better economic yields. Since boards appoint and monitor the executive positions such as the Chief Executive Officer (CEO) and guide the firm’s strategy, boardroom composition has a strong impact on firm performance. Naturally, a gender diverse boardroom will positively affect the economic performance of the firm and Indian businesses would do well to co-opt women in boardrooms to ensure a successful business.
 
India Outbound
October 16, 2019
 
 

source https://indiaoutbound.org/why-india-needs-a-female-boardroom-revolution/

What does the FM’s stimulus package indicate?

The Finance Minister’s announcement of a stimulus package harbours well for the economy that has seen a sustained slowdown. Measures to revive growth come at a time when the world economy at large is buffeted by global headwinds and trade slowdown. All of these does indeed impart some sort of stability and underpins a new growth impetus for India.
 
Following the persistent slowdown, there have been widespread demands of a fiscal stimulus package from various quarters since Sitharaman’s budget to spur growth. But given the precarious fiscal situation, as many economists have warned, it had left the FM very little room to offer a package without breaching the fiscal deficit target. However the FM’s announcement made it evident that she has sought to revive the “animal spirits”, a term initially coined by John Maynard Keynes and found several references in the economy. On top of it she has also tried to unclog the liquidity blockages to ensure smoothening of credit flows and has tried to incentivise demand in certain sectors, without the new measures having any broadscale impact on the country’s finances.
 
Decoding some of the moves
 
The Budget proposal to hike surcharge on Foreign Portfolio Investors (FPIs) had spooked foreign investors, which was supposed to impact 40% of the FPIs as per industry estimates. Nonetheless, the present decision to rollback this enhanced surge is indeed a welcome concession, as the massive capital outflows that stemmed because of this decision could be reversed and instead, aid in the rupee’s appreciation.
 
The withdrawal of the surcharge on FPIs would boost a sagging market. However, a sustained rally on the market is only expected when there is a visibility of good earnings growth and a reversal of the slowdown in the economy.
 
Other steps such as infusion of INR 70,000 crore as capital in state-run banks, to smoothen credit flow that will benefit corporate, retail and market segments is another credible move. However, past instances of capital infusion simply have not proven sufficient and addressed banking issues that has prolonged the country’s economic recovery. An example of this is that while the RBI has announced successive rate cuts, it has not simply got transmitted to bank’s lending rates, whereby hitting both the supply and cost of credit. India’s banking industry dominated by PSUs will be competitive, more efficient and profitable only if there is a structural design change, featuring operational interdependence, empowered bank boards, better governance standards and improvement in quality of lending.
 
Meanwhile, withdrawal of the draconian angel tax that tightened the noose around startups dependent on angel investors is a welcome move. For instance, any startup that has registered itself with the Department for Promotion of Industry and Internal Trade (DPIIT) and has completed all the required valuations would not be bothered by tax authorities. This waiver of the angel tax that would subsequently simplify the flow of risk capital for young startups generally spellswell for a thriving ecosystem. But this response to “tax terrorism,” which had somewhat put a dent on the government’s conduct acts as a post-dated cheque. For a tax that has been in operation for seven years and has been responsible for snuffing out nascent startups, its removal should have occurred earlier.
 
Crucially, the automobile sector that has experienced a lackluster growth for a considerable time has also been accorded some attention. An increase in one-time registration fee has been deferred, a depreciation benefit on vehicles has been doubled, a ban on the purchase of vehicles by government departments has been lifted and a renewed emphasis has been laid on helping a supply chain emerge for the local manufacture of electric vehicles. All of these measures help with both the inventory buildup and creating a new market for e-vehicles, but car manufacturers are unlikely to ramp up production until they see a sustainable return to normal volumes.
 
On the whole, Sitharaman’s stimulus package should rein in investor sentiment and create confidence within the market. This in itself could power the growth engine such as India’s long-languishing investment rate. However, what is needed is to sustain the growth and this could only start with driving up consumption levels which implies more money in the hands of people.
 
India Outbound
September 30, 2019
 
 

source https://indiaoutbound.org/what-does-the-fms-stimulus-package-indicate/

The millennial angle in India’s auto sector slump

Finance Minister’s Nirmala Sitharaman’s logic on explaining the slump in the automobile sector has clearly brought much humour on social media platforms. She stirred a hornet’s nest when she attributed the “mindset of millennials,” who prefer to use Ola and Uber, as one of the critical reasons behind the Indian auto sector’s spectacular fall. According to Sitharaman, millennials today would rather opt for Ola, Uber and other ride-hailing services instead of paying monthly installments for a car.
 
Sitharaman’s comments coincidentally come a day after the automobile sector reported its steepest monthly decline in sales since 1997-98. Vehicle sales across categories including passenger vehicles, two-wheelers and commercial vehicles fell 23.5 % year-on-year, according to the industry body Society of Indian Automobile Manufacturers (SIAM).
 
What resulted from Sitharaman’s statement is it set the stage for a debate. While there are some takers to her side of logic, other industry analysts have merely panned it. Obviously, for the sake of a sound argument, what matters is to figure out that if there exists a direct correlation between buying a car and hiring a taxi. In plain terms, what this implies is whether Sitharaman’s comment has substance or was it off the mark?
 
For one, along with passenger cars, the sales of bus and trucks also saw a precipitous 39% fall last month, thereby compounding the auto industry’s travails. Analysts have said that in this case, it would be far-fetched to lump the blame on millennials, since they would rarely own a bus or a truck. What this broadly implies is a general fall in consumer demand within the Indian economy, something that extends far beyond the millennials and their purchasing behavior.
 
Second, cab aggregators like Ola and Uber are largely restricted to metro cities and to some extent tier-2 cities. Sitharaman’s argument does not explain why vehicle sales have slumped in rural India. For instance, two-wheeler sales, a key indicator of demand from rural India, fell 22% year-on-year in August, according to SIAM.
 
Third, according to some analysts, the crisis of non-banking finances companies or shadow banks have also hit car sales. Although the government in recent times has taken measures to ease up the liquidity crunch in the sector by allowing credit flow, but the supply of easy finance has taken a toll where over three-fifth of vehicles sold are financed through loans.
 
Also, for the record, the concept of ride-hailing services such as Ola and Uber have come to India during the last 6-7 years. Thus, it might be premature to blame them for the disruption, given that the sector has seen some rosy years during the time of their existence. On the larger front, the auto slowdown is more a function of the country’s broader economic woes than of any one specific factor. Consumption, the main pillar of the economy is down in the dumps with GDP growth falling to a six-year low. This is playing out in case of consumers who are holding back purchases because of uncertainty.
 
Hence, it would be wrong to construe the mindset of millennials as the factor behind the slowdown. The reasons for the auto-industry’s plunging fortunes are varied and the millennials aversion to owning cars is only miniscule fraction of this complex issue.
 
India Outbound
September 25, 2019
 
 

source https://indiaoutbound.org/the-millennial-angle-in-indias-auto-sector-slump/

Negotiation is the only way forward: drone attack in Saudi Arabia

A weekend drone attack on Saudi Arabia that cut into global energy supplies and has halved the kingdom’s oil production threatened to exacerbate tensions in the already fragile Middle East. The responsibility of the attacks was claimed by the Houthis, a rebel group in Iran, who struck at the world’s biggest petroleum-processing facility. That matters greatly because as a result, the Saudi Aramco, the kingdom’s state–owned oil company was forced to suspend production of 5.7 m barrels a day. It usually produces and exports around 9.8 million barrels of oil (latest OPEC figures) to consumers around the world, primarily in Asia.
 
Naturally, what this means is a strain in the supply security, and its ripple effects were felt in the oil market where the price of Brent crude surged 18 % (on Sunday evening) before pulling back to a 12% increase. Meanwhile, the strikes also expose the vulnerability of Saudi infrastructure to attacks, historically seen as a stable source of crude to the market. Although on a short-term basis, oil from strategic storage to meet demand and temper the impact on prices could help, this attack introduces a new irreversible risk premium into the market.
 
There are two reasons for this risk premium. If the Saudi outrage gets prolonged and oil prices rally significantly, then it is likely that shale producers (primarily the US) will raise output. But there exist constraints on how much the United States can export because oil ports are already near capacity. Second, oil from storage could keep the market supplied for some time, but oil markets will tend to become increasingly volatile if the storage is exhausted and the possibility of a supply crunch arises.
 
While Saudi Arabia had stopped short of blaming Iran for the attacks, the possibility that Iran has a direct linkage with the attacks was made explicit by Mike Pompeo, along with the U.S government’s damage assessment of one of the stricken oil facilities. These developments come at a time of increasing tension between Iran and the United States. Since the Trump administration’s withdrawal from the Joint Comprehensive Plan of Action (JCPOA)- the nuclear deal with Iran and the renewal of its sanctions has led to an eruption of sorts. From the US launching airstrikes against Iran, to the rise of Iran’s provocation in the Gulf and consequently, Iran’s enrichment of uranium, the situation is teetering on the brink of a war.
 
The U.S has also maintained a “maximum pressure” campaign against Iran that is meant to throttle its economy already reeling under severe sanctions. On the other hand, however, Trump has expressed his desire to meet Iranian President Hassan Rouhani with no pre-conditions that has roiled some of his top advisers.
 
Though it would be premature to call the present act of Trump, who had been publicly pining for a meeting with Rouhani, an extension of an olive branch, one should remember that it takes two to tango. And in this, Iran has been vehement in showing its reluctance to come to the negotiating table with him.
 
What is clear is that the recent spike in the US-Iran tension could spell doom for not only the oil market, but for global energy markets where the Strait of Hormuz has become a maritime flash-point in the US-Iran conflict. For a region that is already reeling under multiple conflicts, what is required is stability and for the sake of it, a bilateral meeting is the most optimal shot.
 
India Outbound
September 23, 2019
 
 

source https://indiaoutbound.org/negotiation-is-the-only-way-forward-drone-attack-in-saudi-arabia/

UNSC discussion about Kashmir: Way forward from an economic perspective

The lack of an outcome of the closed-door discussion on Kashmir in the United Nations Security Council (UNSC) is a diplomatic victory for India. In an implicit criticism of China and Pakistan, Syed Akbaruddin, India’s Ambassador and Permanent Representative to the UNSC, relayed that the UNSC recognized that “Article 370” was entirely an internal matter and henceforth, holds no external ramifications.
 
In effect, all of these reflect India’s growing diplomatic clout coupled with Pakistan’s failure to internationalise the issue. But this should not mean that India can rest on its diplomatic laurels. Truly capturing the benefits of the revocation of Article 370 implies a sound economic development of the state.
 
Behind the decision to revoke Kashmir’s autonomy has lingered the intention of boosting its economy. As PM Modi captures it well in an interview given to the Economic Times, where he states that “the greatest casualty (to the Kashmiris) was the lack of any proper economic avenues to increase earning” and abrogation of these roadblocks i.e. Article 370 and 35 (A)would ensure that people obtain economic opportunities.
 
The Prime Minister also emphasized upon the fact that how Article 370 acted as a stumbling block or impediment in the process of industrialization and concluded that through this revocation, integration with the Indian mainland would boost investment, innovation and outcomes.
 
A pertinent criterion of economic growth is the tide of investments that needs to seep down into the economy. However, investments are unlikely to be forthcoming as long as the state continues to be crippled with unrest. For instance, Kashmir received only $6 million in foreign direct investments between April 2000 and April 2019, the lowest among Indian states. Moreover, the economy, mostly reliant upon agriculture and handicrafts, shows a declining contribution, exacerbated by factors such as vanishing jobs, lower disposable income sand lackluster expansion of the state’s economy.
 
To remedy this crisis, what is required a sustained string of public investments in form of connectivity or power supplies by the Modi administration. For private investments to trickle in, which is still far-fetched given the present crisis at hand, it is important that governments at every level work together by engaging communities in Jammu & Kashmir and Ladakh to ensure that the promises made by the Centre are translated into action.
 
India Outbound
August 27, 2019

 
 

source https://indiaoutbound.org/unsc-discussion-about-kashmir-way-forward-from-an-economic-perspective/

Kickstarting a slowing economy is a challenge that the Indian government needs to fend off

Currently, there exists a persistent shroud about an economic slowdown. For those who are still grappling with the concept, consider this as an example. You are deriving a monthly salary from working in a firm. With that salary, you buy your groceries from a supermarket, dine at a restaurant, employ a help in your home and pay your taxes. What has happened here is that the movement of the money has generated activities within the economy, which would not have happened if you had simply deposited the salary in a bank. In other words, this capital movement has contributed to the Indian Gross Domestic Product (GDP).
 
GDP, in the conventional sense of the term, simply means the measure of all the goods and services produced within a country during a specific time. In this sense, GDP measures the movement of money through and around the economy or rather the economic activity. The above instance adequately substantiates how economic activity contributes to the country’s GDP. Now this cycle of activity is supposed to work and add to the economic activity and GDP.
 
However, it is this economic activity that has taken a beating in India, since the beginning of 2019. As per data from the Central Statistics Office, the GDP growth from January to March 2019 has slowed down to a 5-year low of 5.8%. If we consider the economic activity taking place after the period, it would be pragmatic to concede a further slowdown.
 
Given that consumption forms the most important part of the Indian economy, thereby impacting the overall economic health of the country, it would be prudent to take stock of any slowdown in consumption. The most recent example of this is the crippling of the auto sector, due to a paucity in demand and recurrent job losses. As per the data released by the Society of Indian Automobile Manufacturers (SIAM), vehicle sales across categories, including passenger vehicles and two wheelers have witnessed a decline of 18.71%, the sharpest fall in the last 19 years.
 
The impact of this deepening slowdown has been felt beyond discretionary purchases such as vehicles and has impacted other industries such as the Fast Moving Consumer Goods (FMCG) companies. For Hindustan Unilever, considered to be the largest FMCG Company, there was a 7% point dip in volume growth between the June quarterthis year versus the same period last year. Other companies like Britannia and Dabur have also recorded a similar slide, which indicates a worrying trend, given that people seem to be going slow on even everyday purchases.
 
Such an all-round demand deceleration is worrying given that India has primarily been an economy where supply is constrained. At the core of it lies the obvious fact that incomes are simply not rising enough. Of particular interestis the decline in household savings, as they are a net supplier of funds to both the corporate and the government sector, which have declined to 17.2 % of GDP in 2017-18 from 23.6 % of GDP in 2008-09.
 
The current slowdown in demand is an undeniable fact that the government will need to address. Multiple meetings have been held between the Finance minister and the industry heads to reverse the prevalent economic slowdown. It is crucial that the government enables the initiation of high-end growth, sustained by a virtuous cycle of savings, investments and exports to kickstart the Indian economy again. For this to take place, it is imperative that a coordinated policy response is formulated with the support of the private sector.
 
India Outbound
August 21, 2019
 
 

source https://indiaoutbound.org/kickstarting-a-slowing-economy-is-a-challenge-that-the-indian-government-needs-to-fend-off/

It’s just the oil, honey

The decision of the Organisation of the Petroleum Exporting Countries (OPEC) to extend oil supply cuts at the recently concluded meeting may have important implications for both oil producers and more importantly oil consumers, like India. Collectively, OPEC and its allies (together known as the OPEC+) would curb production by 1.2 million barrels per day (mb/day) for nine months until March 31.
 
Context
 
Global commodity prices saw a dip after the global financial crisis. This occurrence was counter-intuitive due to a kind of hysteresis and slowdown in demand and thus, the resulting price drop happened much later. However, the prices peaked in 2012 when the OPEC average crude oil price touched a high of almost $110. But then prices began to plummet- as low as $40 in 2016.
 
Now, the OPEC+ alliance has been reducing oil supply since 2017, to prevent prices from sliding and has opted to extend the cuts repeatedly since then. Credence to this statement includes the shale oil boom, which requires less upfront investment to push up oil supply. Also, the economic reprieve provided for Iran, one of the core founders of OPEC, ramped up the production, followed by differences propping up among members who failed to reach an agreement that consequently resulted in oversupply. These were the reasons that have caused oil prices to remain at rock-bottom.
 
So, the recent decision to curb supply is poised to restore demand. But, amidst signs that the global economic slowdown may hit the oil demand growth, OPEC and allies might face an uphill task to shore up prices by reining in supply.
 
How does this play out for India?
 
These extensions of production cuts come against the backdrop of supplies from Iran and Venezuela drying up from India’s energy baskets. The US sanctions on Iran and Venezuela in conjunction with the extra cuts made by Saudi Arabia have taken more oil off the market than the rest of the 11 countries involved in the production cut agreement combined. With tensions escalating in the Persian Gulf, India, the world’s third largest oil importer has been trying to impress upon the Saudi Arabia-led cartel, its own concerns on volatility in crude prices and its impact on India consumers.
 
Though the United States on its part has promised India of adequate crude oil supplies as was mentioned by US Secretary of State Mike Pompeo during his visit to India, but it is not so much about the sourcing rather than the price at which it is bought, which will impact the Indian economy.
 
What India needs now is a carefully driven strategy that is not myopic in nature, but instead, aims to gradually insulate the country from global oil price volatility. Such a strategy should be centered on three things: expediting migration to electric mobility, expanding the blending of biofuel in petrol and stimulating exports.
 
In this case, the much needed impetus to push electric mobility during the 2019 budget is a well-concerted move. Reducing the country’s reliance on oil imports would bode well for energy security and make the Indian financial markets less volatile in the event of untoward development of the oil market. Also, savings from reduced oil imports could in turn be used to finance the infrastructure projects which are crucial for India’s long-term growth prospect.
 
India Outbound
July 23, 2019

 
 

source https://indiaoutbound.org/its-just-the-oil-honey/

Indian-Russian ties amidst changing Eurasian dynamics

A new breakthrough happened in the Indo-Russian relationship on the sidelines of the 2019 G20 summit. On this note, the proposal by the Indian government to move forward with the S-400 defense system, whose payment would apparently be made in euros to a Russian nominated bank speaks heaps about the eminence that India attaches towards the relationship. However, for a partnership to become robust it needs to be supported by strong geo-political and geo-economic foundations that will provide it with much needed sustenance.
 
Apropos, during the Bishkek summit, PM Modi’s bilateral with his Russian counterpart outlays the significance of Russia in India’s foreign policy. This was visible through remarks of Vijay Gokhale, the foreign secretary, who emphasized upon Russia’s participation in India’s Act East policy, where India is looking to expand collaboration in Russia’s Far East.
 
Further, PM Modi’s acceptance of Vladimir Putin’s invite to be the Chief Guest for the Eastern Economic Forum to be held in Vladivostok early September also outlines the strategic importance accorded to this partnership, as the two leaders decide to further widen the scope of their economic partnership, in sectors such as energy, Arctic region, transfer of technology among others.
 
A defining aspect of the Indo-Russian partnership,post the Cold War days includes the military-technical cooperation between the two countries that have gone up tremendously and is probably at its most dynamic stage.With the induction of Russia into India’s Act East policy, where both Russia and India prepare to explore areas for enhancing India’s presence in Russia’s Far East, spell both economic and strategic imperatives for India, given the uncertainty in the international affairs.
 
So far, there is trade imbalance in favour of Russia, a marked departure from the past when the erstwhile Soviet Union was among India’s leading trade partners. More so, according to statistics, India-Russia trade during 2015-16 amounted to a dismal $6.7 billion, thereby highlighting the fact that trade and investment ties remain far below potential. In this sense, the above initiatives reflect some semblance of hope of reigniting the aspect of economic cooperation between the countries that has so far remained dormant.
 
So where exactly do the India-Russia relations stand now? The relationship in fact is quite a good metaphor for the polycentric world of offsetting ties of cooperation and competition as the sun sets in the turn on US unipolar dominance. Russia‘s pivot to Asia (read: China) started in 2014, following the US and the European Union, imposing sanctions to isolate Moscow after its annexation of Crimea. Further, Chinese premier Xi Jinping’s visit to Moscow, underscoring the strengthening of the Beijing-Moscow axis, compounded with Moscow’s outreach to Pakistan has definitely triggered concerns in New Delhi.
 
Thus, in a world that is increasingly grappling with the challenges of the bipolar emergence of power (US and China), India and Russia share a convergence of interests. In times such as this, where Trump is interested in pushing towards a “deglobalisation wave” while China is promoting “globalisation2.0.”,it makes sense for India and Russia to strengthen collaboration in all forms to hedge any disruptive forces.
 
India Outbound
July 4, 2019

 
 

source https://indiaoutbound.org/indian-russian-ties-amidst-changing-eurasian-dynamics/

Premier launch of CHRI’s ESTD report in India

The Human Rights Council (HRC) is a supranational organ of the United Nations (UN), which focuses on the “promotion and protection of Human Rights around the globe.” The HRC serves as a useful platform for countries and voluntary associations, such as the Commonwealth, to engage in meaningful dialogue with regard to human rights around the world. In order to facilitate such dialogue, it is important to educate stakeholders about the UN, its mechanisms and the various pledges and obligations that countries have voluntarily committed to, so that they are aware of the standard to which their performance should be pegged.
 
Enter, the Easier Said Than Done (ESTD) report.
 
Since 2007, the ESTD report has been produced by the Commonwealth Human Rights Initiative (CHRI) to evaluate the performance of Commonwealth member states at the Human Rights Council (HRC), and to highlight the opportunity for the Commonwealth and its member states to re-elect on and improve their human rights record. This year’s report, the 11th edition, was prepared by CHRI’s International Advocacy and Programming (IAP) department of CHRI, led by research officers, Aditi Patil and Sarthak Roy, and their team: Chinmay Panigrahi, Catia Trevasani and Aditya Bhattacharya.
 
For the first time since its inception, the ESTD report was launched in New Delhi, India at the OP Jindal Auditorium on 21 June 2019. This report covered the 40th session of the HRC and analysed the performance of 11 Commonwealth countries elected to the council:Australia,Bangladesh,Cameroon,India,Nigeria,Fiji,Pakistan,Rwanda, South Africa,the Bahamas,and the United Kingdom.
 
Aside from the launch of the report, the event featured presentations from the authors of the report, as well as panel discussions on the key findings, and India’s presence at the HRC. The 40th session saw the introduction of Fiji at the HRC, marking the first election of a Pacific Island country to the council. Commenting on the milestone, H.E Yogesh Punja, High Commissioner of Fiji, noted that reports such as the ESTD were fundamental for enabling effective and objective dialogues between countries to further the protection of human rights.
 
Several other eminent diplomats, senior government officials, activists and human rights defenders also attended the event, such as: Mr. Muchkund Dubey, former Ambassador and former Indian Foreign Secretary; Ms. Yukiko Koyama, Senior Protection Officer, UNHCR India; Mr. Jawad Ali, Counsellor, High Commission of Pakistan to India; Mr. Micyo Rutishisha, Second Counsellor, Rwandan High Commission, Ms. Pallavi Nayek, Direct Aid Program Administrator with the Australian High Commission, and Ms. Friederike Tschampa, a representative from the European Union.
 
When the topic of the discussion shifted to India’s human rights conditions, there were lively contributions from the distinguished panellists, each of whom reiterated the universality and indivisibility of human rights.
 
Mr Paul Divakar, General Secretary, National Campaign of Dalit Human Rights (NCDHR), said that inter-generational labelling had to be addressed at the grass-roots. Discussing the nature of identity politics and its role in rising divisiveness in the country, Mr Divakar added that there was no place for discrimination based on caste, gender or sexuality, in a meritocratic society.
 
Mr. TCA Rangachari (IFS, retired), former Amabassador to Algeria, France, Germany and India’s Permanent Mission to the UN New York, raised some concerns about India’s economic ability to follow through on its commitments at the international standard.
 
With the successful launch of the ESTD report at the 40th session of the HRC, and with the 41st session already underway, CHRI hopes that such reports will not only raise awareness among Commonwealth nations, but also spur the formulation of effective measures for the protection of human rights, at both the state and international levels.
 
Aditya Bhattacharya
July 3, 2019

 

source https://indiaoutbound.org/premier-launch-of-chris-estd-report-in-india/

Pompeo’s visit to India: What holds for the India-US ties?

The arrival of the US Secretary of State Mike Pompeo to New Delhi brings forth a range of issues that holds ground both for India and the US. As external affairs minister Subrahmanyam Jaishankar sits down for a bilateral with our American counterpart, the aim will be to inject a new energy into a relationship that seems to have been enveloped in crisis. Well, argument about the usage of word “crisis” might surface, but it is worth noting that there have been recent occurrences of divergence over certain issues. Even as geo-strategic issues converge, relations in the economic sphere have remained testy between both the countries.
 
For nearly two decades, Delhi and Washington had shed their Cold war differences and expanded the ambit of their bilateral and multilateral cooperation. Part of the reason includes the rise of the revisionist power such as China, about whom both India and US share common ground. But, differences once again dominate the public narrative. These range from trade and market access, to cross border data flows and India’s purchase of oil from Iran and advanced weapons from Russia.
 
On this front, this piece takes stock of the threemost potent issues that will be on the table:
 
Trade tensions
 
For the White House behemoth who perceives every relationship in a transactional sense, trade seems to be the signature issue. The sharp convergence of US-India on geo-strategic issues has unfortunately seen trade ties deteriorate under the Trump administration. For instance, Trump has often termed India as “tariff king,” citing high tariffs imposed on items such as the Harley Davidson. Indian exporters recently lost preferential access to American markets for several products and the US seems bent on equal tariffs on both sides on tradable goods. It is very likely that Pompeo will discuss tough topics with his Indian counterpart such as GSP, trade barriers for American companies and data localisation. On the latter, it is likely that US might face resistance, since India has explicitly vouched for localisation of data i.e. data to be stored within the geographical parameters of the country.
 
Oil
 
The volatility in crude oil and its impact on Indian consumers is also a potential issue to feature in the discussions. The visit comes in the backdrop of the increasing tensions in West Asia, with the US tightening its screws on Iran. The West Asian country has for so long been one of India’s top oil suppliers, exporting 23.5 million tones in financial year 2018-19. Though India can source oil from other sources, for instance, the US is a likely partner, but the price at which the oil will be brought would hurt the Indian economy. A formidable example includes the time that would be taken for tankers from the US to reach India. While ships can economically sail from the Gulf to India carrying oil quantities as low as 60 to 40 tonnes, a journey from the US could only be possible in large tankers. Also, voyages from US would take around 50 days,while those from West Asia usually take around eight to ten days.
 
On terrorism and Afghanistan
 
Beyond business, the emphasis will also include taking a common view on the conflict brewing in the west of India. While prospects of oil imports from US-blockaded Iran appear negligible,Washington may have no problems with India’s assets in Iran’s Chabahar port, a project that would establish trade linkages with Afghanistan. In this, India would like the US troops to stay in Afghanistan and stabilize the country, rather than cut a deal with Taliban. New Delhi is not happy with the talks that the US is having with the Taliban that could possible indicate full withdrawal of the US troops in the region. India’s Afghanistan policy is majorly driven by pursuit to stymie Islamabad’s influence in the region, where a Taliban-led government could quickly side with Pakistan. The subject of terrorism thus makes it an inescapable feature in the talks, as Pakistan’s influence in Afghanistan will not only reduce India’s sphere of influence, but also make India more susceptible to Pakistani-inspired terrorism in the wider region.
 
Thus, it is widely apparent that given the present status, where both Indiaand the US are at the crossroads of various issues, it is imperative for both to iron out the contentious aspects of it. In this, a non-ideological approach to the negotiations would focus on breaking the irritants to smaller parts, expanding the boundary conditions and creating linkages across sectors. If Washington views this relationship through the prism of transactionalism, then it could wreck havoc for both the countries. In all, the ball is in DC’s court and it is for them to decide.
 
India Outbound
June 27, 2019

 
 

source https://indiaoutbound.org/pompeos-visit-to-india-what-holds-for-the-india-us-ties/