Google Analytics

Amazon Contextual Product Ads

Tuesday, September 15, 2009

EDITORIAL 15.09.09

Please contact the list owner of subscription and unsubscription at:


media watch with peoples input                an organization of rastriya abhyudaya


month september 15,  edition 000298 , collected & managed by durgesh kumar mishra, published by – manish manjul


Editorial is syndication of all daily- published newspaper Editorial at one place.












  1. THE 101ST DAY








































































The recent by-elections in Gujarat, Madhya Pradesh and other States were largely necessitated by the election of sitting MLAs to the Lok Sabha. For the BJP, particularly two of its most high-profile Chief Ministers, Mr Narendra Modi and Mr Shivraj Singh Chouhan, the by-elections were an important test. In both Gujarat and Madhya Pradesh, the Congress had done better than expected in the Lok Sabha election and this was read as a negative verdict on the popularity of the local BJP Governments. In the case of Gujarat, following the ruling party’s loss in a recent municipal election in Junagadh and a strong campaign by sections of the Congress and the media, Mr Modi’s political obituary was being drafted yet again. The odds were against the BJP anyway, because six of the seven by-election seats had been won by the Congress in the 2007 State Assembly election. Yet, in the end, the BJP won this round 5-2. While numerically smaller, Mr Chouhan’s victory in Madhya Pradesh was no less impressive. Two seats were up for by-election, both having been won by the Congress as recently as December 2008. Here too the BJP hit back and hit back hard, wresting the Tendukheda seat, long a Congress stronghold and territory that the State Congress unit president, Mr Suresh Pachauri, considers his borough. In Uttarakhand, too, the party won the Vikasnagar by-election to secure a majority in a precariously bipolar Assembly.

What does one make of these results? For all its exertions, in both Gujarat and Madhya Pradesh the Congress has not been able to come up with charismatic provincial leaders to challenge the appeal of Mr Modi and Mr Chouhan. This is the weak link in the Congress’s much-publicised attempts to rejuvenate the party organisation in the States. The hard fact is in today’s federalised India, people will not automatically vote for a national party or platform in their States. They have learnt to distinguish between national and local contests and will not discard an able State leader or Chief Minister merely because Mr Rahul Gandhi tells them to or because Mr Manmohan Singh is perceived as a decent but distant man. In being representative of a decentralised India, where each State is an individual polity, the BJP is actually better placed than the Congress. The latter has just lost is lone genuine State strongman in Andhra Pradesh and is once again focussing on the merits of a supreme national leadership, the proverbial ‘high command’. While this may give the image of stability to impressionable circles in New Delhi and may be, as was proved in May 2009, a useful calling card in a Lok Sabha election, it will not eventually work when it comes to winning the hearts and minds of the States.

For the BJP, too, there is a lesson from these by-elections. Rather than get demoralised by motivated media-led campaigns in the national capital, the party should fall back on its reserves in the States. Obsessions and ideas that become big issues in the hothouse atmosphere of New Delhi’s political salons and television studios are perceived quite differently in the States. In New Delhi, Ishrat Jahan is an ‘innocent victim of fascism’; in Gujarat, she is a Lashkar-e-Tayyeba moll. In New Delhi, Mr Chouhan is seen as ‘losing ground’; in Madhya Pradesh, he is fighting back. The BJP should take heart from this and shake off its inertia.







With the death of Norman Borlaug the world has lost a great scientist and humanitarian whose pioneering work in the field of agricultural science has directly and indirectly saved millions of lives from the scourge of hunger and starvation. Aged 95, Borlaug passed away last Saturday when he succumbed to cancer-related complications. However, like a true soldier, till his last breath he encouraged greater scientific innovation in food production and agricultural practices to ensure that no one in the world goes to sleep hungry. It was his relentless pursuit of a permanent solution to the world’s food problem that earned Borlaug the Nobel Prize for Peace in 1970. Having in many ways pioneered the development and use of ‘High Yielding Variety’ of seeds, Borlaug enabled several under-developed and developing nations in attaining basic self-sufficiency in food production. No country knows this better than India. Working with Indian scientists, he enabled our farmers to adopt and implement a series of scientific measures in the 1960s that saw India’s wheat production more than treble and marked the end of our dependence on food aid. It goes without saying that India’s Green Revolution would not have been possible without Borlaug’s inputs and guidance that helped our scientists develop indigenous HYV, disease-resistant seeds that have made the country a food surplus nation.

Borlaug’s work in the development of genetically modified crops and advocacy for intensive agriculture based on the use fertilisers and pesticides often earned him the ire of environmentalists. Nonetheless, given that organic farming is still very much a ‘hippie’ idea that only millionaires have taken a fancy to, it would be hard to argue against Borlaug’s contention that it is better to die of eating genetically modified food than to die of hunger. Plus, Borlaug’s work proved wrong several doomsday theories in the latter half of the previous century that had predicted that the world, with its burgeoning population, would simply implode due to hunger and other related problems. Countries like India were supposed to ‘capsize’ first given their ‘low technology’, ‘primitive agricultural practices’ and ‘ever-expanding population’. Clearly, the work that Borlaug did and the ideas that he came to represent ensured that this never happened. However, the fight against hunger is yet to be won. There are millions of people around the globe who still die of malnutrition and starvation every year. Borlaug knew this, and this is the reason why he insisted till the end that mitigating hunger is an issue that needs to be taken up with far greater zeal by Governments of the day than the kind of attention it is receiving now. If anything, Borlaug’s memory should serve as a reminder that complacency on our part to eradicate hunger will be an unforgivable sin.



            THE PIONEER




In an act of brazenness aimed at formally integrating Jammu & Kashmir’s Northern Areas into the Islamic Republic, Pakistani Prime Minister Yousuf Raza Gilani on August 29, 2009 unveiled a plan to replace the existing Northern Areas Legislative Council with a Gilgit-Baltistan Legislative Assembly, a Governor, and a Chief Minister with a six-member Council of Ministers.

The ‘Gilgit-Baltistan Empowerment and Self-Governance Order, 2009’, which India has strongly protested, was approved by President Asif Ali Zardari on September 8, 2009. It is accompanied by a move to construct the 7,000 MW Bunji Hydroelectric Project in Pakistan-occupied Kashmir, with China’s assistance, secured during Mr Zardari’s visit to Beijing last month. It may be recalled that it is from the Northern Areas that Pakistan gifted 5,000 sq km of Indian territory to China, which facilitates its occupation of Tibet.

The Northern Areas are strategically important for their proximity to Afghanistan and China. Pakistan, on occupying them in 1947, isolated them from the rest of ‘Azad Kashmir’ and treated Gilgit, Baltistan, Hunza and Nagar as a separate administrative unit. The proposed Gilgit-Baltistan Legislative Assembly will have 24 elected members, who in turn will elect six women and three technocrat members, taking the total strength to 33 members. The Assembly will elect a Chief Minister, but the right to select the Cabinet will be vested in the Governor. Thus, the Governor, to be appointed by the President of Pakistan for an indefinite period, will replace the Chief Executive.

The Governor must have a minimum age of 35 years, and be qualified to be a member of the Pakistan National Assembly. This suggests that the Governor of Gilgit-Baltistan will be from Pakistan, like the Chief Secretary, Finance Secretary and Inspector-General of Police in Pakistan-occupied Kashmir. The current Kashmir & Northern Affairs Minister, Mr Qamaruzzaman Kaira, is to take over as Governor.

The proposed new system will confer the Northern Areas with a province-like status. It will have a ‘supreme appellate court’ headed by a chief judge, a public service commission, a chief election commissioner, and an auditor-general. So far, the people of Gilgit-Baltistan do not have official Pakistani citizenship.

Indian Kashmiri leaders oppose the package on the ground that it undermines the ‘disputed’ status of Jammu & Kashmir by formalising the status quo by trying to turn Gilgit-Baltistan into a virtual province of Pakistan. This is a marked departure from Islamabad’s stated position of supporting the struggle for self-determination for the people of Jammu & Kashmir.

Mr Yasin Malik of the Jammu & Kashmir Liberation Front, who was visiting Pakistan when the decision was announced, called it “an arrow that has been shot into the hearts of Kashmiris” by Pakistan. It betrayed Mr Yousuf Gilani’s promise to consult all stakeholders before taking any decision. The move was also denounced by Mr Amanullah Khan, leader of a faction of the JKLF, who said Pakistan’s “wavering stand” on Kashmir had already cost it the support of the Security Council; Islamabad was now squandering residual goodwill by “merging” Gilgit-Baltistan with Pakistan.

Merger fears are reinforced by the Pakistan People’s Party Gilgit-Baltistan president Syed Mehdi Shah demanding the formation of a Gilgit-Baltistan Council, to be headed by the Prime Minister. Mr Zardari has also ordered beginning the Gilgit-Skardu road project, and setting up regional branches of the National Bank of Pakistan, National Database and Registration Authority, and the House Building Finance Corporation. Pakistan-occupied Kashmir is unhappy with this move. Even the Jamaat-e-Islami, which favours Kashmir merging with Pakistan, joined the protests, explaining that it opposes piece-meal solution to the ‘Kashmir issue’.

However, Mirwaiz Umar Farooq, chairman of the All Parties Hurriyat Conference, said the new political-administrative package announced by the Pakistan Government met the longstanding demands of the people of these areas and denied it would have a negative impact on the ‘Kashmir cause’. But Syed Salahuddin, chairman of the United Jihad Council, opined that since the political status of the State is still unresolved, any change of status would have a “negative impact”.

Problems on the Indian side of the Line of Control are hardly less invidious. Recently, the Jammu & Kashmir legislature passed a resolution for a Chenab Hill Council which involves a de facto division of Jammu into Muslim and Hindu areas, on the pretext of ‘plains’ and ‘hill areas’. The proposal to have plains and hill areas hill councils was mooted by Chief Information Commissioner Wajahat Habibullah when invited to speak at the Working Group of Centre State Relations on Jammu & Kashmir.

Panun Kashmir chairman Ajay Chrungoo took strong exception to Mr Habibullah’s formula for separate councils for Jammu plains and hill areas, claiming it would divide Jammu region on communal lines. Mr. Chrungoo pointed out that in April 2005, Mr Habibullah had mooted Regional Assemblies for the State on communal lines, and now he was proposing separate councils.

Mr Chrungoo said this was nothing more than a reworking of Gen Pervez Musharraf’s plan for seven autonomous regions for the State — two for Jammu (Muslim mountains, Hindu plains), two for Ladakh (Shia Kargil, Buddhist Ladakh), one for the Kashmir Valley to retain Muslim domination though the Valley also has hill and plains areas; and finally, Mirpur and Muzaffarabad in Pakistan-occupied Kashmir. Mr Habibullah’s ‘Kashmir formula’ drew the ire of many parties, who demanded other ‘experts’ be invited to the working group if the Chief Information Commissioner was called as an ‘expert’ on the State.

The BJP demanded Provincial Councils for Ladakh and Jammu regions, with adequate financial, administrative and legislature powers to redress the sustained neglect of these areas. It demanded scrapping of Article 370 as it had led the State from separate status to separatism. The BJP contested the National Conference proposal for autonomy and the PDP’s for self-rule, saying both were akin to pre-1953 status and thus unacceptable. It urged rehabilitating the Valley’s displaced Hindus.

The Panthers Party emphasised the discrimination faced by Jammu region, which is larger and has more voters than Kashmir, but has been accorded less Parliament and Assembly seats than Kashmir. The Valley is favoured in terms of road connectivity, employment, electricity production and treatment for migrants. It urged State subject rights to 1947 refugees, permanent settlement of the problems of Pakistan-occupied Kashmir refugees, and allotment of one-third Assembly seats reserved for Pakistan-occupied Kashmir to refugees living in the State.







Americans have been trapped in Afghanistan. US President Barack Obama is face-to-face with the reality that the so-called ‘war against terrorism’ is collapsing. There are clear indications that Afghanistan is going to prove another Vietnam for America. Mr Obama has increased American troops from 21,000 to 68,000 with a new Commander, Gen Stanley McChrystal. During his election campaign, Mr Obama had emphasised that the war in Iraq and Afghanistan have fundamental differences. Eight years have passed and American might is being humiliated as more and more US and coalition soldiers are getting killed. The puppet regime of President Hamid Karzai remains in a state of coma.

If we take into account the recently held presidential election, some uncomfortable facts will emerge. Mr Karzai is not only a failure but unpopular too. Nearly 2,000 complaints of fraud in the election have been lodged. Former Foreign Minister Abdullah Abdullah is a popular figure but did not command acceptability in Pashtun-dominated areas in the south.

In both Afghanistan and Iraq Americans have been defeated but instead of gracefully accepting their defeat they are on a civilian-killing spree which all world bodies, including the UN, are ignoring. I have no doubt that one day Afghanistan will prove to be another Vietnam for American troops. US Senator Russ Feingold has rightly observed, “It is a time for a flexible response in order to pull out.” The American psyche is so scarred that columnist George Will says, “It is time to get out and fight the war through drones and other means.”

Long years ago, James P Warburg had said in response to President Truman’s speech in the US Congress on March 17, 1948: “At present our policymakers see only the threat of a Russian dominated world. In seeking to forestall this danger, the makers of United States policy are thinking in purely negative terms. This means that they are consciously or unconsciously thinking of an American dominated world as the sole alternative.”

Mr Obama should pull out troops from Afghanistan and address some of the urgent problems at home like the economic collapse and the failure of foreign policy. After all, he contested and won the presidential election on the slogan of ‘change’. He should now translate that slogan into action.








On September 7, 2009, Pakistani President Asif Ali Zardari signed what is called the ‘Gilgit-Baltistan Empowerment and Self-Governance Order 2009’, purporting to introduce administrative, political, financial and judicial reforms in the Northern Areas of Jammu & Kashmir, which has been under Pakistani occupation since 1947-48. The order re-names the Northern Areas as Gilgit-Baltistan, thereby seeking to obliterate the linkage of the area with Jammu & Kashmir.

Addressing a Press conference the same day, president of Gilgit-Baltistan branch of the Pakistan People’s Party, Syed Mehdi Shah, said that Mr Zardari had instructed the authorities concerned to prepare a comprehensive plan to accelerate economic development in Gilgit-Baltistan. He claimed that the Zardari Government had given internal freedom and all financial, democratic, administrative, judicial, political and developmental powers to the Legislative Assembly of Gilgit-Baltistan. He said that a Gilgit-Baltistan Council, to be headed by the Prime Minister, would be set up and that Mr Zardari had ordered early initiation of a Gilgit-Skardu road project, the establishment of regional branches of the National Bank of Pakistan, the National Database and Registration Authority and the House Building Finance Corporation in the area.

Explaining the changes sought to be introduced by the Government in the status of the area to the media, Prime Minister Yousaf Raza Gilani stated as follows on August 29, 2009:


  “All the stakeholders were taken on board prior to getting the approval from the Cabinet to give internal and political autonomy to the Northern Areas, which shall be now called Gilgit-Baltistan.”


  The foreign office was consulted on it and they have cleared it. “Every aspect was taken care of.”


  The Cabinet decision will empower the Gilgit-Baltistan Council and the Assembly to make laws. “The subjects about which the Assembly shall now have power to make law have been increased from 49 to 61 while the Council shall have 55 subjects.”


  There will be a Governor for Gilgit-Baltistan, who will be appointed by the President of Pakistan. Till the election of the Legislative Assembly, the Minister for Kashmir and Northern Areas will be acting as the Governor. “There will be a Chief Minister, who shall be elected by the Gilgit-Baltistan Legislative Assembly and will be assisted by six Ministers with the provision of two advisers.”


  The Legislative Assembly will have 24 members, who will be elected directly and in addition, there will be six women and three technocrat seats. In order to empower the Council and the Assembly on financial matters there would be a consolidated fund. The budget of the area would be presented and approved by the Gilgit-Baltistan Legislative Assembly.


  The Chief Judge of the Appellate Court will be appointed by the Chairman of the Gilgit-Baltistan Council on the advice of the Governor, and other judges will be appointed by the Chairman on the advice of the Governor after seeking the views of the Chief Judge. The number of judges will be increased from three to five.


  A Gilgit-Baltistan Public Service Commission, a separate Auditor-General and an Election Commissioner will be appointed.


  Answering a question, Mr Gilani said under the Constitution, Northern Areas could be given the status of a province, “but we have given them internal autonomy as per the Constitution.”


  Answering another question, he said Gilgit-Baltistan could not be given representation in Parliament. Responding to a query, the Minister for Information, Kashmir Affairs and Northern Areas Qamar Zaman Kaira said the measures would be enforced through a presidential order replacing the Legal Framework Order of l994.

In an article on the subject titled “The Gilgit-Baltistan Bungle” published by the News, on September 10, Asif Ezdi, a retired officer of the Pakistan Foreign Service, stated, inter alia, as follows:

“The Gilgit-Baltistan (Empowerment and Self-Governance) Order, 2009, approved by the Cabinet on August 29 seeks to grant self-rule to the people of the area on the pattern of the autonomy enjoyed by Azad Kashmir. As the Government itself admits, the promulgation of this Order, which has now been signed by Mr Zardari, implies a rejection of the demand that Gilgit-Baltistan be made a province of Pakistan and that its people be given the same constitutional rights, including representation in the National Assembly and the Senate. The reason given by the Government is that acceptance of these demands would go against Pakistan’s obligations under UN Security Council resolutions on Kashmir, which give Islamabad administrative powers over the territory but debar any change in its status.

“Given this self-imposed constraint, the Government had only limited room for action. It could only make those changes in the constitutional structure of Gilgit-Baltistan which would devolve more powers to the people of the territory, but not affect its international status. The last two constitutional measures adopted by the Government for the Northern Areas — in 2000 and 2007 — had also sought to give more powers to the elected Assembly within this constraint. The scope for further devolution was thus quite small. It is therefore no wonder that the changes introduced by the latest constitutional package are by no means of a radical nature.

“The most significant change is that a Council has been set up on the same pattern as exists in Azad Kashmir. It will have the power to legislate on more or less the same subjects as the Azad Kashmir Council. The federal Government will have a built-in majority in the Gilgit-Baltistan Council, as in the Azad Kashmir Council. The practical consequence is that legislation on these matters will continue to be controlled by Islamabad.

“Some of the changes made in the new law are cosmetic, such as renaming the Chairman as Governor, the chief executive as Chief Minister and advisers as Ministers. On the one hand, the new designations seek to highlight similarities with a province; and on the other hand, they underscore difference from Azad Kashmir.

“Since the purpose is to equate Gilgit-Baltistan with Azad Kashmir, the Government needs also to do two more things. One, it should rename the new legal framework for Gilgit-Baltistan as the Interim Constitution, just as the fundamental law of Azad Kashmir is called. Two, the new constitutional package should be passed by the elected Assembly of Gilgit-Baltistan, just as the Azad Kashmir Interim Constitution was passed by the elected Assembly of Azad Kashmir, instead of being promulgated through executive fiat.

“The concerns of Kashmiris are two-fold. First, their position has been that Gilgit-Baltistan is part of Jammu & Kashmir and cannot accede to Pakistan separately from the rest of the state. Second, Kashmiri leaders have expressed the fear that the accession of Gilgit-Baltistan would be taken as Pakistan’s acquiescence in the permanent partition of Kashmir and would harm the freedom struggle. Such misgivings have been voiced by Yasin Malik (of the J&K Liberation Front) and by some political circles in Azad Kashmir.

“Typically, the new law was not presented before its adoption for public or parliamentary debate. Instead, the Government only held some closed-door briefings for the parliamentary committee concerned and a few selected leaders from the Northern Areas. Representatives of Azad Kashmir and the APHC were not consulted. The Government clearly still treats the matter as a bureaucratic issue to be tackled bureaucratically.”

Northern Areas of Jammu & Kashmir, now re-named as Gilgit-Baltistan in violation of the UN resolutions by the Zardari Government, has a total area of 28,000 sq miles as against the only 4494 sq miles of Pakistan-occupied Kashmir, which Pakistan calls Azad Kashmir. It had a population of a little over 1.5 million in the 1990s. It was part of the State of Jammu & Kashmir before 1947 and was called ‘Northern Areas of Jammu & Kashmir’ to distinguish it from the Valley, Jammu and Ladakh.

The writer is director of the Institute of Topical Studies, Chennai.To be continued…








Uttar Pradesh Chief Minister Mayawati and Union Minister for Railways Mamata Banerjee attract a lot of national attention because they are quite-a-typical regional leaders in their respective States.

India’s English-speaking intelligenstia and other political observers have either praised these two leaders in hyperbolic language or both of them have been characterised as unconventional opportunists who want power at any cost. But beyond that Ms Mayawati and Ms Banerjee can be described as ‘commoners’ or ‘subalterns’ who have struggled hard to enter the corridors of power, which were once occupied and monopolised by high caste elites and bhadraloks.

Ms Mayawati attracted a lot of positive response from a particular strata of Uttar Pradesh society when she projected herself as the ‘daughter of a Dalit’. On the other hand Ms Banerjee, with her very simple way of life, has attracted attention because people see her as a ‘commoner’ who has risen through the ranks and is now challenging the authority of the ‘Bengali bhadralok’. Both the leaders were once seen as ‘representatives’ of a new phenomenon of the rising Dalit star and a shabbily dressed leader whose lifestyle was not at all different from the real struggling masses of West Bengal.

Novelty in politics is always an object of curiosity and extra-attention is paid to leaders who represent a ‘different’ lifestyle and also are able to mobilise social constituencies, which have remained passive in the participatory system of electoral politics.

Though both the Uttar Pradesh Chief Minister and the Minister for Railways might have succeeded in attracting public attention at the time of their entry, but initial curiosity does not last long when any leader, established or a new entrant, has to win electoral acceptability and political legitimacy. A new chapter begins in the life of every leader when his or her activities and actions are scrutinised by everybody, including their political competitors.

This process began quite dramatically in the case of Ms Mayawati and Ms Banerjee, who from the level of ‘unknown’ political leaders began winning elections for themselves as individuals and for their political followers. Now they are fully involved in the ruthless and cut-throat game of power and their political career has given rise to a different kind of public perception about their politics and personality traits.

They carry an extremely flexible, expendable, even saleable, ideological baggage and have never shown any hesitation in making and breaking political alliances. The main trait of their politics has been to promote their own limited interests by forming alliances with all and sundry. Each of their political ally has experienced betrayal and in actual interaction with allies these two leaders have been found quite slippery, even whimsical in behaviour. Hence their inclusion in alliance system of governance is considered a necessary evil because of the numbers game either in the Lok Sabha or Legislative Assemblies. Both of them are politically tolerated by their temporary allies but they are not at all considered as trustworthy comrades-in-arm. This whimsical and unpredictable behaviour or attitude of these two leaders is experienced by their own followers in the Bahujan Samaj Party and the Trinamool Congress.

The BSP and the Trinamool Congress are private political shops managed authoritatively by their bosses and any voice of dissent within the party is not permitted and personal loyalty is rewarded. If DMK supremo M Karunanidhi dictated that his ‘family’ members should be accommodated in the Manmohan Singh Cabinet, Ms Banerjee, not to be left behind, picked her favourites who were to be only Ministers of State and she was to be the sole Cabinet Minister.

Ms Mayawati and Ms Banerjee do not have any ‘equal’ in their political outfits and self-projection is their main goal. While the Uttar Pradesh Chief Minister is busy constructing her own statues to perpetuate her memory, the Minister for Railways is a past-master at leading violent demonstrations with a view to facing police action so that she can project herself as a great political fighter and opponent of the Communist-led Government in West Bengal.

Besides, these two leaders have very limited role to play outside Uttar Pradesh and West Bengal but they are always eager to project themselves on the national scene. Both of them have the normal ambition of climbing the ladder and means are irrelevant to achieve the end.

It is widely assumed that public actions, attitudes and behavioural patterns of leaders are scrutinised and evaluated. Fortunately, on this front, critics and opponents of Ms Mayawati and Ms Banerjee do not have any gender bias against them.

They might have generated hostility at the entry point of their political career because of their social background, but they cannot pretend that they have been ‘persecuted’ because in the 21st century they have emerged as leaders in their own right and have clearly shown that arbitraries are their personality trait, which is reflected in their politics.









September 11 is typically a day when the world looks to New York and Washington, where elaborate and moving ceremonies remember nearly 3,000 people who died there. It’s also a good time to remember what has followed since for the rest of the world, and, the signs in the jihadi build-up to 9/11 that the world missed then, but can’t afford to miss again.

With Pakistan and Afghanistan (and AfPak, the overlapping trouble spot in between), that becomes a daily game of second-guess, and anyone trying to follow events there will be grateful for a slew of books that have come out in the past few months, all by journalists — The Al Qaeda Connection by Imtiaz Gul is the perfect primer on just what is going on in FATA, Pakistan’s Tribal areas — essential if you want to follow the post-Mehsud possibilities for the Tehrik-e-Taliban Pakistan. Interestingly, his case is that Al Qaeda is doing to Pakistan in Waziristan what Pakistan did to India in Kashmir — not to be missed, his description of the Kandahar hostage exchange, as well as a detailed chapter called the ‘ISI factor’.

The next great read is Nicholas Schmidle’s to Live or Perish Forever, the title taken from one of partition’s great proponents (and the man who coined ‘Pakstan’) Chaudhury Rahmat Ali’s description of the choices before Muslims pre-1947. You can be sure most Pakistanis are horrified to see Schmidle use it in a more current context. If Gul gives you information on militant groups and leaders, Schmidle’s is a real inside look at the fundamentalist idealogues who inspire jihadi militancy in Pakistan. His friendship with Abdul Rashid Ghazi, the cleric of the Lal Masjid, who was killed inside, and his description of the man and that movement is riveting. Equally so, descriptions of the militant Sunni Sipah-e-Sahiba group, and meetings with more mainstream leaders of the MMA and the Jamaat-e-Islami. His two year stint in Pakistan was cut short when Schmidle’s work got too ‘interesting’ for the Government, and he was deported.

Next for a book I confess I got to too late — journalist Murtaza Razvi’s description of Musharraf: The Years in Power, completed shortly after he resigned in August 2008. Straight journalism, fact over opinion, this is a great event-by-event record of Gen Pervez Musharraf’s coup and presidency. Pakistan has shown, that through the turmoil and exile, bans, and imprisonment its leaders face, its choice of leadership doesn’t change.

It was Benazir versus Nawaz for two decades before Gen Musharraf added himself to the mix. Razvi’s description of the dictator-President is sympathetic, showing Gen Musharraf as a man who tried hard to change the system, change himself, even change the military-civilian equation, and utterly failed at all three. He may now face a trial for treason, certainly, the last hasn’t been heard from Pakistan’s former President just yet. With indications that Gen Musharraf may (re)turn to Pakistani politics once the moratorium on his entry expires (two years since he gave up the uniform) in November, this book has a renewed relevance.

ABC correspondent Gretchen Peters was based in Pakistan and Afghanistan for two years before 2001, and watched the jihadi build-up. Yet he was caught unawares by the 9/11 attacks. But unlike many of us Peters chose to go back, and over the past six years has done the research that has gone into Seeds of Terror: The Taliban, The ISI and the Opium Wars.

Peters case is that a much bigger problem today is that the criminalisation of the Taliban and Al Qaeda — from ‘Mujahideen to the Mob’, is how the author puts it. Not only has the Taliban come back with a renewed strength, it is a renewed criminal strength, one that allows it to conduct a massive narcotics operation — a chain that begins with Osama bin Laden but ends with Dawood Ibrahim with high officials in Afghanistan and Pakistan either turning a blind eye or profiting along the way — an estimated $ 500 million a year industry in opium and heroin.

Gretchen has put under a close scanner also just what the US is doing — when it takes its focus off Iraq and peace-keeping, that is — and found ISAF tactics exactly what they shouldn’t be: For example, destroying the poppy crops of poor Afghan farmers, rather than squeezing the refiners and drug barons instead. At her most incisive, Peters describes the US approach to the sub-continent flawed because it “itemises and prioritises” challenges, rather than look at them as a whole, and that leads them to pick the wrong partners (ISI, Taliban and the mujahideen at different times)

There’s an ease of language that all these journalists employ that make all these books easy reads, but also they are great points of reference eight years after 9/11. Seldom has the ‘rough cut’ of Pakistan’s history been so interestingly researched.








Close on the heels of a Comptroller and Auditor General (CAG) report that work on most Commonwealth Games projects is way behind schedule, the Games organising committee is under fire. Commonwealth Games Federation president Mike Fennell has said he will seek Prime Minister Manmohan Singh's intervention to speed up preparations before it is too late. The CAG report and Fennell's indictment have confirmed what most people already know: Delhi is woefully unprepared to host the 2010 Commonwealth Games.

The government needs to understand that the Games are not just about staging a world sporting event; it's about India's global image. If we goof up in holding the Games, India will become a laughing stock. It would not only impact India's ambitions to hold other major events, such as the Olympics, but more importantly dent the country's standing as an investment and tourist destination. That's why preparations for the Games cannot be left to the organising committee, as is the practice in the rest of the world. The Commonwealth Games Organising Committee has clearly shown it is not up to the task of holding a global event of this magnitude.

There is no option but for the prime minister to call a high-level meeting and designate either the sports minister or someone from the Delhi government who can coordinate and execute work for the Games on a war footing. There is precious little time left for the Games to begin, and unless work on the venues is speeded up immediately India will be left with egg on its face. It's not only work at the venues but also infrastructure projects that need to be finished well before the Games begin. This will require coordination between different civic agencies that seem lacking at the moment. Delhi CM Sheila Dikshit's proposal to bring Delhi's civic body under the state government needs to be considered. There is also the security aspect which will be of paramount importance. Several sporting events, including the recently-held World Badminton Championship in Hyderabad, have been hit by security-related pullouts. We don't want a similar thing happening with the Commonwealth Games. Participants must be assured that security for the Games is going to be of the highest standard.

The 2010 Games will invariably be compared to the earlier editions held in Manchester and Melbourne. And the clockwork precision of the Beijing Olympics is still fresh in many people's minds. It's too much to expect Delhi to match the show put up by Beijing. But in the roughly 12 months left for the Games to begin, no stone must be left unturned to get the preparations back on track. We cannot afford to waste any more time.







Union law minister Veerappa Moily's assurance that the government intends to revisit constitutional safeguards that are misused by corrupt officials to ward off prosecution is timely. Evidence suggests that these safeguards, formulated to prevent harassment of public officials, have become a liability in the fight against corruption. As the minister said, these laws need to be rationalised and simplified to ensure that transparency and accountability are not compromised in public administration.

At the heart of the problem is Article 311 of the Constitution that mandates prior permission from the government for courts to prosecute a corrupt public official. Though this provision has since been amended, the minister himself is on record that even the amended law has, at times, been interpreted in ways to prevent prosecution of the corrupt. Statistics quoted by the minister are revealing: Of the 153 cases waiting sanction from the government, 21 have been pending for more than three years, 26 between two and three years, and 25 between one and two years. Moily also said, "Departmental enquiries are soft-pedalled either out of patronage or misplaced compassion".

Clearly, the ailment has been diagnosed. Now the minister must order medication. The contentious clause must be suitably amended so that its scope is limited to the original intent: public officials should be able to act without the fear of possible harassment by their political bosses or even other officials. A repeal of the clause could lead to an impasse in administration since, in the absence of any safeguards, public officials might adopt an excessively cautious approach towards potentially controversial issues and refuse to act quickly on pressing administrative matters.

However, these concerns, though legitimate, must not override the efforts of the government to make governance more transparent and public officials accountable. Corrupt public officials are enemies of the public. Their corruption is not merely a moral problem but it also negatively impacts the general efficiency of the country. Laws like the Right to Information Act have been enacted to curb corruption in the government. The judiciary too has joined the efforts to raise the standards of accountability and transparency in administration. These efforts will come a cropper if the same yardsticks are not applied to the bureaucracy.







Three recent events reopen the debate on the wisdom of India's nuclear tests in 1998, as judged from within the narrow framework of its own interests. Or rather, they confirm the folly of the tests. K Santhanam, director for the 1998 test sites preparations, recently claimed the hydrogen bomb tests yielded less than half the amount of projected destructive energy: 15-20 kt, not 45 kt. His claims were rejected by prime minister Manmohan Singh, former president A P J Abdul Kalam, the then scientific adviser to the ministry of defence, and Brajesh Mishra, former national security adviser in the BJP government. But these claims have also been backed by some influential heavyweights, including P K Iyengar, former Atomic Energy Commission chief, and are broadly in accordance with the conclusions of most disinterested international observers who analysed the test data at the time.

The reason for the revelation may be to put pressure on the government to conduct further tests to validate the design of India's hydrogen bomb, before the window is closed if the Obama administration ratifies the Comprehensive Test Ban Treaty and pressures remaining holdouts to follow. France, for example, conducted over 20 tests over the course of developing a full-scale thermonuclear arsenal.

Second, India recently began sea trials of a new nuclear-powered submarine with underwater ballistic launch capability. It plans to acquire a fleet of five, although even the first will not be operational for combat duty for some years yet. Third, Pakistan has been perturbed at the prospect of more Indian tests, nuclear-powered submarines and India's civil nuclear cooperation deal with the US.


In an article in the Bulletin of Atomic Scientists, Robert S Norris and Hans M Kristensen argue that Pakistan is enhancing nuclear weapons capabilities across the board, developing and deploying new nuclear-capable missiles and expanding its capacity to produce fissile materials for use in weapons. Their article adds weight to calculated leaks from the US intelligence community expressing unease at Pakistan's nuclear programmes.







The Chinese are upset, once more, with the Indian establishment. This time it's because the Dalai Lama is planning to visit Tawang, in Arunachal Pradesh, and New Delhi is unlikely to stop him from doing so. China, which lays claim on Arunachal Pradesh, wants India to prevent the exiled Tibetan leader from entering the state. Just last year, the Dalai Lama had to cancel his visit to the same area as the Indian administration denied him permission, reportedly under pressure from China. But this time, New Delhi is standing firm.

China has gone back on the guiding principles the two countries agreed upon to sort territorial disputes by claiming not just Tawang but the whole of Arunachal Pradesh. With an increasing number of incursions by members of the People's Liberation Army along the Line of Actual Control as well as Chinese attempts to block Asian Development Bank funds for Arunachal Pradesh, Beijing has shown little sensitivity to New Delhi's interests.

It's time, therefore, that New Delhi also got more assertive about its position. Arunachal Pradesh is an integral part of India and it is India alone that can decide who is free to visit that state. It is not Beijing's business to be dictating whether the Dalai Lama or for that matter any other person it dislikes can or cannot travel within Indian territory.

India has made it clear that the Dalai Lama cannot conduct a political campaign within its territory. The Dalai Lama's visit is supposed to be a religious one and as long as he sticks to that agenda, there is no reason to restrict his travels. Keeping New Delhi on the diplomatic hop by administering pinpricks may be part of Beijing's strategy. While Beijing has settled its boundary disputes with most of its neighbours, India remains the sole exception. Recently Taiwan approved a visit by the Dalai Lama over Beijing's objections, even though its president Ma Ying-jeou is reputed to be pro-Chinese. There's no reason for New Delhi to bend backwards to suit the Chinese.







The ways of political decision-makers are strange, and they are busy proving it at the moment. Last year, the government turned down the Dalai Lama's request to visit Tawang, and rightly so. This year, it has given him the go-ahead. Why it would see fit to do so when developments along the volatile Sino-Indian border have, in fact, taken a turn for the worse over the past year is difficult to understand. It is either an ill-advised attempt at keeping the pressure on Beijing or simply poorly thought out. In either case, it represents muddled thinking.

Leaving aside the merits and demerits of both sides' border claims, the reality is that the McMahon Line is very much contested territory. The Line of Actual Control is a far better indicator of strategic realities, and that itself is difficult to define in certain areas. For the moment, the only workable solution if a temporary one is to freeze the status quo and work around it, engaging on various other issues. In this context, aggravating the situation and putting Beijing's back up serves no constructive purpose.

New Delhi has enough on its plate at the moment. The magnitude of the Naxalite threat has finally been realised, an important engagement is taking place with Bangladesh and the situation with Pakistan is growing more fraught. It must focus on these instead of opening up yet another front. True, Beijing has tried to play hardball vis-a-vis Arunachal Pradesh at the Asian Development Bank. But it has failed emphatically; New Delhi does not need to press the point.

As for the Dalai Lama's reasoning that he is visiting Tawang purely for religious reasons, not political, it is plainly disingenuous. The two are difficult to separate at the best of times, and almost impossible in this situation. New Delhi must leave space for flexibility when it comes to settling its border issues. And that may not be possible if it backs the Dalai Lama past a certain point, as the pressure of public opinion would constrain its choices. It is time for New Delhi to be pragmatic.






We live in a country that prides itself more on recent growth spurts than on its extraordinary history and mythologies. We are encouraged to move on, to embrace change. But you cannot separate past and present. This is why, in his wonderful biography, Dreams From My Father, Barack Obama reminds us that "The past is never dead and buried it isn't even past." The past is the present. It sparks our thoughts and our imagination. It is the reason for sudden rage or that inexplicable moment of joy.

In India, the past is wrapped up in mythology stories, symbols and rituals that bind people together and help us make sense of what is happening around us. Some are magical myths and talk of river goddesses gushing down mountains, others stem from historic events. Both shape our realities.

As you grow older, you start longing for some semblance of the past, to piece together the present, to relive the myths. Often, when you stop to search, all you find are manufactured memories and a few frayed photographs. Most people have watched their childhood spaces morph into something new rambling havelis, old songs, faces, even entire villages, have disappeared overnight. So when you accidentally stumble on to a moment where past and present came together, it is charmed. It happened to me last month, in Manali, in a pine cone valley with the river Parvati running through it.

As a child, i had spent many summers in John Banon's log cabins, with sisters and cousins and hot tomato soup punctuated with crunchy croutons. Like everything else, the place had changed. Manali now has a hip Goa vibe. There are cafes named after Bob Dylan, offering shelter from the mountain storm, with menus in Hebrew and French. A different charm.

But then we went to Manikaran, the site of an ancient Shiva temple and a gurdwara and hot springs. As we drove down the winding mountain roads, i started getting flashbacks of two little girls splashing in the water. When we got there, and saw the extraordinary sight an icy cold river gushing down, and hot springs bubbling on either side i remembered the place as if i'd seen it in a dream. Steam rose up from the river as if out of a good witch's cauldron. Some pilgrims were dipping little cloth bags of rice into the boiling water and leaving them there to cook.

It was exactly the same as i had last seen it, more than 30 years ago. As we sat at the feet of a giant Nandi bull, watching the hot steam envelope a statue of Shiva, an old sardar who had travelled miles on a truck sat next to us. He had come to cure his rheumatism. He told us how Parvati had lost her jewels here while bathing, and Shiva sent a snake to retrieve them. The snake spat the jewels out and the hot springs emerged. Truly, the sulphur springs were jewels, for they had healing properties. Many years later, Guru Nanak came here to meditate. I loved the stories i had heard as a child and i believed them in the same way that i believe that Hanuman really flies around at night and enters my son's dreams.

Myth is not falsehood. It is a different kind of truth, writes mythologist Devdutt Pattanaik. "There are many types of truth. Some objective, some subjective. Some logical, some intuitive. Some cultural, some universal. Some are based on evidence, others depending on faith. Myth is truth which is subjective, intuitive, cultural and grounded in faith." I am so grateful for the myths around Manikaran that refuse to change while everything else around us does. It placed me into another world. And even back in the city, where the reverse horns blare inside my head, i can hear the healing river and the tinkle of Nandi's bells.







The West's great fashion dilemma at the moment can be summed up thus: to shave or not to shave. But this is not about male stubble or hairy female legs. It is about women's eyebrows, and the question is, should they ever be completely removed? ''Fashion is an established prejudice,'' said French fashion guru Pierre Cardin. Since we're accustomed to seeing a woman with a penciled eyebrow, the very thought of absence of it is literally and metaphorically an eyesore.


But, history will bail me out in that there was a time in Europe when women regularly shaved their eyebrows. Leonardo da Vinci's La Gioconda, better known as Mona Lisa, has no eyebrows. Italian painter Titian never liked women with eyebrows. He even got his paramour, a hoary old nobleman's correspondingly young wife, to shave her eyebrows.

Edward Gibbon and Bulwar Lytton wrote in The Rise & Fall of Roman Empire and The Last Days of Pompeii respectively that the women of Rome never had eyebrows. Historian Arnold Toynbee corroborated this fact. The women of ancient Rome were influenced by Cleopatra, who had irritatingly thin eyebrows. But naturally, she shaved them off. The mildly raunchy Scottish bard Robert Burns wrote: ''On a damsel lovely and fair/ There shouldn't be hair anywhere.'' What exactly he meant by it is rather unintelligible and best left to his (or another's) imagination, but the fact is, women's eyebrows didn't grow in medieval Europe. Even Radha of Jaydev's Geet Govind has no eyebrows! Ancient Greek playwright Sophocles found Aphrodite, from whose name the word 'aphrodisiac' originated, more alluring and intoxicating for her lack of eyebrows.


Fashion follows icons. What an iconic figure does often becomes fashionable. In 1963, Playboy's legendary playmate Zenith Thompson appeared without eyebrows. It became a trend for some time. Today, if Aishwarya Rai were to suddenly decide to go without her eyebrows, rest assured, many girls would try to emulate her. Remember, after all, that fashion is not about what makes people look beautiful. It is the cult following a new style acquires that is more important. So, there may now be the third category of no-brow after high-brow and low-brow.









‘Managing completely flawless operations is a major challenge,’ said a Delhi Metro Rail Corporation (DMRC) official after a train derailed on Sunday. A major challenge, yes, but the running of the showpiece Delhi Metro is one in which the bar must be set exceedingly high. The derailment comes in the wake of the collapse of a viaduct, one reason why people are beginning to question the infallibility of the Metro operations. It is a sign of how desperate we are for any institution of excellence that we have almost unrealistic expectations of the Metro and more so of its iconic chief E. Sreedharan.


By our somewhat low standards, the Metro’s record has been fairly competent in the seven years of its functioning. But the latest mishap should be taken with utmost seriousness and the problems ironed out without delay. Internal inquiries, that is the norm with the DMRC, will not do much to assuage public fears. Lakhs of people travel by this cheap, clean and convenient mode of transport. When things go wrong, the public has a right to know what it is and what the authorities propose to do to rectify the situation. So, it is not a very good idea to have inquiry reports available only to select insiders. The need to set things right is all the more pressing as work on the Metro is on full tilt to wrap things up by the time the Commonwealth Games begin next year. The theory that haste could cause slip-ups is unacceptable. In mass transport systems, there should be minimal margin for error. Unfortunately, given that it is such a prestigious project, the Metro has often been used by various political parties to score points against each other. This is one reason why both its merits and de-merits are blown out of proportion.


The need for course correction is all the more urgent for two main reasons. One is that given the massive overcrowding on Delhi’s roads, the Metro is the one lifeline that could prevent the city from descending into total bedlam. The other is that this project will serve as a model for other cities looking for ways to ease the traffic pressure on inadequate and poorly-maintained roads. Yes, of course, national prestige will be at stake come the Games. But the primary concern must be the safety of passengers. Standards must be constantly reviewed and course correction instituted as soon as a flaw is detected. This is the only way to ensure that ambitious projects like the Metro do not get derailed.







Not too unlike one of those dotcom companies of the late 90s that notched up a notional value for a week that would have raised Donald Trump’s dyed eyebrows, the Indian cricket team enjoyed being the world’s No. 1 team for 24 hours 14 minutes to be precise. On September 11, the Men in Blue were the best One-Day team. On September 12, after a terra firma-ing 139-run defeat against Sri Lanka in Colombo in the triangular Compaq Cup, it was a slide down to being third on the rung, that is, with South Africa as the top dog and the Lankans occupying the Indians’ earlier No. 2 kennel.


But being No. 1 even for a day does strange uplifting things for a cricketing nation like India. For starters, nearly every Indian cricket fan — 1.2 billion of them — swelled with pride at the news of reaching the top of the line in a sport that’s played with any serious success by less than a dozen countries in the world. It’s another matter that an overwhelming proportion of the same hurrahing crowd didn’t get to hear the bad news the next day and are still under the impression that their team is the finest bunch of kids on the block. Also, with the happy (and less temporary) news of two Indians facing each other at the final at the US Open Men’s Doubles (yes, one of them had to be on the winning side), a desi winning a bronze medal at the World Boxing Championship in Milan, who would bother about the detail of the Indian cricket team sliding two notches in 24 hours?


Just as well we had been sitting on our derrieres when India’s No. 1 ranking was announced on Saturday. Which is why today, 48 hours after India became No. 3, we can trot out such a smart, up-to-date editorial.








Just over a year from now, Delhi will host the Commonwealth Games. In 2003, at a meeting of the Commonwealth Games Federation in Jamaica, India won the rights to the 2010 Games with a heavy-duty campaign. In a close race with the Canadian city of Hamilton, India eventually moved ahead by promising each participating country — including such economies as Australia and Singapore — $100,000 in preparation fees.


Some saw it as a bribe but the Indians felt differently. Rising powers often use symbols to illustrate their arrival on the world stage or perhaps even their aspirations.


It is debatable whether such trifles actually mean anything in the larger reckoning. Yet, India is not alone. Japan used the Tokyo Olympics of 1964 to showcase its post-war economic miracle. South Korea did likewise in 1988. Beijing’s Games in 2008 were described, prematurely as it turned out, as China’s “coming out party”.


Not every such gamble works. The 1976 Montreal Olympics was such a financial disaster that the flagship stadium and the Games themselves are still remembered as the “Big Owe”. The stadium was incomplete when the Games began. Cost overruns and a tax imposed to pay for the construction had already made it unpopular. The retractable roof was not ready till 1987. The public exchequer finished paying for the stadium as late as 2006.


A similar, white elephant syndrome defined the aftermath of the Athens Olympics. Far from the cradle of Western civilisation, Greece was a sort of Sick Man of the European Union by 2004. Fellow Europeans — particularly the often cruel British press — mocked its abilities and said the Games were destined for failure.


To be fair, the Greeks worked hard to put up a grand show, but their exertions tested budgets and deadlines. The original outlay of $6 billion rose to $15 billion, part of the increase being explained by enhanced security provisions following 9/11.


At the opening ceremony, two Greek performers made evident their country’s ability to laugh at itself. They hammered in a nail and exclaimed: “There, the last nail is in place. The Olympic stadium is finally ready!”


Athens is a much smaller city than Delhi but offers useful precedents. Lacking an intra-city train network, it used the Olympics to give itself its long overdue Metro. The city’s traffic was and remains horrific. The International Olympic Committee secured the promise of an ‘Olympic Lane’. For the duration of the Games, one lane of Athens’ three-lane avenues was dedicated for use by vehicles of the ‘Olympic Family’: athletes, officials, journalists and so on. At peak hours, the average Athenian commuter was not happy to have his driving space constricted.


How will Delhi drivers respond in October 2010? Indeed, why is this background relevant at all? Actually, these contexts offer four messages for the Indian capital.


First, unlike Japan in 1964 or South Korea in 1988, India is hosting the Games early in its economic growth story. This has meant its cities lack the resources and crucial infrastructure that should have anyway been in place before the incremental construction for the Games.


Second, if Delhi resembles a massive and ugly construction zone today, it is because the city authorities have confused a much-needed urban upgrade — which should have happened irrespective of the Commonwealth Games — with event-specific measures. It can be argued that Athens did this too, but it has a little over three million people, a quarter of Delhi's population.


Third, it may not always be noticeable in all the frenzy, but there is life after the Commonwealth Games. Yet, the long-term costs Delhi and its civic ethos are being asked to pay are in some ways far higher than the “Big Owe” bills Montreal ran up.


Till even 2003-04, tourism planners spoke of Commonwealth visitors walking down a riverside promenade built by a salvaged Yamuna. Today, the river is a glorified sewer. The riverbed, crucial to receiving floodwaters and to groundwater recharge, is the site of the Games Village. This is an environmentally questionable move that is bound to bring India bad press. It was permitted after the government told the Supreme Court there was no time for alternatives and the ravaging of the Yamuna riverbed was necessary for ‘national prestige’.


When Delhiites envisioned a Metro, they thought of a network of underground trains. Today, they have ungainly lines running past their balconies. This too was justified as cheaper and quicker and needed to meet Commonwealth Games deadlines. The examples can go on.


Fourth, Delhi’s civic sinews are grossly overstretched. A Commonwealth Games mini-city — village, stadiums, everything — could have been built on a virgin location close by (say Sonepat or Greater Noida). This is the model Beijing and, to a degree, Athens followed. However, to foist Games facilities upon the busiest stretches and most densely-populated neighbourhoods of a living city, to play havoc with ecology and urban design, is the equivalent of murder.


Aside from those in the real estate business and the fixers who double as Indian Olympic Association (IOA) officials, the Commonwealth Games is becoming a nightmare for Delhi. Far from a matter of pride and popular participation, it is an albatross around the city’s neck. The IOA now talks of bringing the 2018 Asian Games and the 2024 Olympics to Delhi. After the Commonwealth Games experience, spare us.


Ashok Malik is a Delhi-based writer








There was a discernible, and welcome, note of urgency to UPA-II when Manmohan Singh’s second ministry was sworn in this May. A perception was gained that this was not a political alliance casually carrying on from the first UPA government — that it was in fact conscious it was taking office with a fresh, more unambiguous mandate and was thus keen to speedily deliver accordingly. Thus, perhaps, the flurry of 100-day agendas announced by various ministries. Now, a hundred days later, it is instructive to not just compare what was promised by various ministries and what has been achieved, but also take stock of the groundwork laid to reconfigure government for more responsive policy-making and better delivery of goods and services. The report card, as a survey in this newspaper on Monday reflects, is considerably more mixed than the government could have wanted.


This stocktaking comes amidst a drought whose effects are yet to be absorbed by the people and the economy. In her first address to the new House, the president indicated that UPA-II’s big-ticket social programme would be a food security act. The incremental evidence since then that this could be a year of distress for the farm sector, and thereby to the consumer too, is not reflected in any move to undertake the necessary reform of the public distribution system. However, from the beginning, two ministries positioned themselves for special scrutiny, for the promise of a break from past mismanagement: human resource development and law. HRD Minister Kapil Sibal perhaps erred by casting his net excessively wide for a 100-day agenda. While the right to education has become an entitlement on his watch, he has yet to concretise public-private partnerships, an autonomous authority for higher education and a framework for the entry of foreign education providers, all promises grandly made. Nonetheless, he must be credited with changing the discourse on education, rescuing it from the culture wars of his predecessors and internalising a higher standard for performance.


Law and Justice Minister Veerappa Moily too came to his portfolio with excessive expectations, that he would see his ministry less as a tool for political firefighting and more as a vehicle to bring transparency, accountability and reform to our justice system. Moily, a veteran of commissions to reform governance, began with a foot fault (on the Judges Assets Bill) and has been struggling ever since to regain his balance. The cascade of controversies thereafter has, however, meant that the focus remains unwaveringly on his larger agenda.







Captive to its debilitating infighting, the BJP has been holding India’s parliamentary functions hostage to the vagaries of its internal politics. It needs no emphasis that such a course of action ill-behooves a party with elected representatives in Parliament, let alone one electorally mandated to function as the main parliamentary opposition. Yet, by continuing to boycott the Public Accounts Committee’s proceedings, the BJP is making a mockery of the public expectations thrust upon it, and diminishing its own stature in Parliament and in national politics. It should be all the more embarrassed, given the stronger sense of responsibility that some of its alliance partners, such as the JD(U), have demonstrated by attending the PAC’s first meeting on September 7.


The politics of Jaswant Singh’s expulsion from the BJP and its subsequent demand that he step down as chairman of the PAC — a post that, since 1967, has conventionally gone to the opposition — should not interfere with the committee’s task, which is vital to the executive’s accountability. That the PAC examines the government’s expenditure, its finance accounts and other accounts laid before the House, makes the opposition’s role essential. In fact, the PAC provides space for the opposition to question the executive and impact national politics in ways not circumscribed by House circumstances and parliamentary sessions. By vacating this space, even temporarily, the BJP is abdicating its political responsibility to the nation.


For the record, this is not the first instance of the BJP passing up opportunities to opine and intervene — it has failed consistently to do so on important economic and foreign policy matters, building itself instead monuments to non-issues. It appears that NDA constituents like the Shiv Sena and the Swatantra Bharat Paksh may attend the next PAC meeting too. Even one of its own nominees in the PAC, Shanta Kumar, has publicly wondered if the BJP’s boycott can continue for a full year — a PAC chairman’s term — since “the committee’s work has to go on.” If that’s the voice of the BJP’s conscience, the party had better pay heed.








The Congress, apparently, can let no good thing go untouched by sycophancy. So it is with the National Rural Employment Guarantee Scheme. It was UPA-I’s bit achievement; but it was conceived with the UPA’s then-allies on board, and took on, in the last term, a non-partisan flavour — encouraged by the fact that the energetic and effective rural development minister, Raghuvansh Prasad Singh, was not from the Congress but the RJD. But that hasn’t survived C.P. Joshi, a Congressman from Rajasthan, getting the portfolio.


The Congress has been concerned that centrally-funded schemes, like the NREGS and the National Rural Health Mission, might not bring them sufficient dividends electorally if they are associated with a non-Congress state government that’s implementing them effectively. That calls for hard grassroots political work. What it does not call for is politicisation of the entire scheme. But Joshi has chosen the latter, putting at risk the broad non-partisan support the NREGS has deservedly enjoyed. Consider this: the NREGS had had implementation problems; so, very properly, the minister convened an all-party meeting to get ideas in, late last month. But the real decision-making had already taken place at a meeting a few days earlier — on Rajiv Gandhi’s birthday, presided over by Rahul Gandhi, with only Congressman in attendance.


It was at that meeting that Joshi announced too that, since UPA-I had unconscionably not named the scheme after a member of the Nehru-Gandhi family, UPA-II would remedy that by building Rajiv Gandhi Seva Kendras in every village out of NREGS funds, each costing up to Rs 22 lakh. And now comes news that the advisory board of the NREGS has been rejigged to drop non-Congress MPs (as well as experienced experts on rural governance, like Debu Bandopadhyay) for Congress MPs. The costs of partisanship and sycophancy can be high. It is to be hoped that they do not sink the NREGS.










The current debate over partition is radically incomplete. The debate has been framed around Jinnah’s desire for a federal but undivided India, in which the states would have been more powerful than Delhi. In contrast, Nehru’s preference is said to be for a centralised polity, with Delhi given more powers than the states. It has been argued that the latter was responsible for India’s partition.


What is wrong about this way of framing the discussion? Contemporary political theory suggests another perspective on Jinnah. Historical research has not wrestled with a fundamental theoretical question: was Jinnah in favour of what political theorists call “consociational democracy”? It is a term I will explain in a moment. But its grave real-world implications can be stated right away: if Jinnah’s argument was indeed consociational, then partition was inevitable and Jinnah was as responsible for it as anybody else. For the Congress party to accept a consociational argument would have meant denying everything India’s freedom movement had stood for. Nehru could not have possibly agreed. Nor, incidentally, could Gandhi.


A consociational democracy opposes liberal democracy on at least three counts. First, according to consociational theory, groups — religious, linguistic or racial — are the unit of politics and political organisation, not individuals. As we know, strategising about groups is a pervasive feature of politics, whether in the US or India. The consociational theory goes far beyond that. It says that the constitution should allocate political power and offices to different religious or ethnic groups — 50 per cent of offices would go to group A, 30 to group B, 20 to group C, etc.


Second, each community would be represented by a political organisation of that community only, not by an organisation that claims to be multi-religious or multi-ethnic. This is the “sole spokesman” idea: that only the Muslim League would represent India’s Muslims. LTTE made similar claims about the Tamils of Sri Lanka.


Third, minorities would have a veto in governmental decision-making, and consensus should be the basis for governmental functioning. If the Muslim League did not like something that others wanted Muslims to consider, the deliberation would not go any further.


The consociational theory is not simply an abstract exercise. In books after books, Arend Lijphart, a Dutch political scientist, has demonstrated that consociational democracy was used in several small European countries after World War I: Holland, Belgium, Austria and Switzerland. More controversially, he has also argued that a consociational democracy is much better for multi-ethnic, multi-religious societies, for it allows disaffected groups to develop a sense of security.


Outside Europe, too, there are examples. Consociational versus liberal democracy was a matter of serious debate during South Africa’s transition after apartheid. Lebanon after 1943 opted for consociational democracy. Malaysia today has a semi-consociational model.


A key question about Jinnah is this: was he a consociational or a liberal democrat? We don’t know the answer conclusively, for that is not the frame within which historical research has been conducted. But the hypothesis that Jinnah was consociational, not liberal, is profoundly plausible. Consider three different points in the evolution of his argument.


First, it is after the Lucknow Pact of 1916 that, in a pre-theoretical moment of political exuberance, Sarojini Naidu called Jinnah an “ambassador of Hindu-Muslim unity”. One should, however, note that the Lucknow pact was fundamentally premised upon separate electorates for Muslims, and also on one-third of representation reserved for Muslims in government.


Second, the Lahore Resolution (1940) made the case that Hindus and Muslims were not simply two distinct religious groups, but two different nations that required separate political roofs over their cultural heads. In the words of Jinnah, “Hindus and Muslims belong to... two different civilisations that are based mainly on conflicting ideas and conceptions. They have different epics, different heroes and different episodes. Very often the hero of one is a foe of the other, and likewise, their victories and defeats overlap. To yoke together two such nations under a single state, one as a numerical minority and the other as a majority, must lead to growing discontent and final destruction of any fabric that may be so built up for the government of such a state”. In comparison, the argument of Maulana Azad, a deeply religious Muslim and a Congress leader, was dramatically different. “I am a Muslim and proud of that fact... In addition, I am proud of being an Indian. I am part of the indivisible unity that is Indian nationality... Eleven hundred years of common history have enriched India with our common achievement. Our languages, our poetry, our literature, our culture, our art, our dress, our manners and customs, the innumerable happenings of our daily life, everything bears the stamp of our joint endeavour. There is indeed no aspect of our life which has escaped this stamp... This joint wealth is the heritage of common nationality.”


Nehru’s view of the nation and politics also departed radically from Jinnah’s. This is what he wrote in The Discovery of India: “There was a fundamental difference between the outlook of the Congress and that of religious-communal organisations. Of the latter, the chief were the Muslim League and its Hindu counterpart, the Hindu Mahasabha. These communal organisations, while in theory standing for Indian independence, were more interested in claiming protection ad special privileges for their respective groups.”


1946 is the third key point in the evolution of Jinnah’s argument. Unless future research proves me wrong, Jinnah by that time was wholly consociational. He was not only talking about a federal India with greater powers for the provinces. He was also emphatic about the Muslim League being the “sole spokesman” for India’s Muslims.


Even if the Congress had accepted the idea of a loose federal state, how could it have agreed that Congress was only a Hindu party, not different from the Hindu Mahasabha, and it could not represent Muslims at all? There were undoubtedly some Hindu nationalists in Congress, but they never took control of the commanding heights of the party. At least since Gandhi burst on the scene in 1919, the Congress was always committed to the idea of a composite nation. Agreeing with Jinnah’s consociational argument would have meant fundamentally denying the ideological commitment to the possibility of a multi-religious politics and a secular Indian nation.


Finally, would consociationalism have really brought peace to an independent India? The available comparative research is quite clear. Consociational democracies have worked well in richer European settings. In lower income postcolonial scenarios, consociationalism has actually been a recipe for endless troubles. Lebanon’s case is the best known. The fundamental problem is that a polity so exclusively group-based only deepens group identities. It does not make groups secure. In the end, it undermines national feeling.


It is hard to imagine a post-1947 India, which had separate electorates for Hindus and Muslims, which allowed only one communal party representing each religious group, which apportioned political offices strictly on the basis of religion, and which nonetheless had peace. Partition was a horrific event, but it is not clear that a consociational India after 1947 would have fared better. Nehru’s critics must confront the consociational puzzles about Jinnah’s ideology and conduct.


The writer is a professor of political science at Brown University, US. His books include ‘Ethnic Conflict and Civic Life: Hindus and Muslims in India’.









The role Norman Borlaug, who died on Saturday, played in the import of the dwarf “miracle wheat” seeds in the mid-’60s has almost a Puranic Katha status: with Sivaraman Saheb — the agriculture secretary — playing the Arjuna, C. Subramaniam — the minister — the Krishna, and Borlaug the role of the Pitamah.


I landed in Delhi in 1974 after having modelled Gujarat’s perspectives, and given my econometrics degree was pulled in to head the then-powerful Perspective Planning Division of the Planning Commission, which has always been a friend of agricultural scientists. Borlaug would visit India. Great scientists at a particular level, like economists, live in the world of the laws of biology, botany and geology. Borlaug could easily slide into that world; but at another level, unlike economists, they don’t believe only in solving problems in theory. Borlaug was one such icon, like Verghese Kurien. He would come to the Planning Commission; and one could take one look at the way the director-general of the Indian Council of Agricultural Research and his men would tiptoe in with him and know he was the works. They would come to Sivaraman’s office and I would be asked to hang around because he had a disconcerting habit of asking questions about canals, pump-sets, fertilisers and wheat prices — precisely the questions the ICAR abhorred. These were the things they could blame the economists for, and so I had to chip in. Jeff Sachs, who has spent a lot of his time rubbishing Indian efforts, now prescribes for Sahelian — sub-Saharan — Africa the Indian ‘70s model of giving money for tubewells and a good price. For Borlaug the world was more complicated. Owning the Indian wheat revolution, he was not going to let that rot in the fields.


By those days, the gains of the ’60s were gone. India’s grain production had reached 116 million tonnes in 1971 and then went down to around a 100 million tonnes. The Sussex Institute, the World Bank and assorted forecasters were coming out with dire forecasts. India won’t feed itself, they said, and its medium-term growth prospects were zilch. Borlaug shared the pain of Indians “living ship-to-mouth” and kept up the vision. But on his annual pilgrimage he would get into the details. Why are the canals not working? What about the rabi fertiliser? If not imported, because energy prices had rocketed, what about giving electricity from Bhakra to the Nangal fertiliser plant (starving the towns; austerity again). What about credit, prices and procurement? What about loans for tubewells in Bhatinda? Why was the Mohindergarh Lift Canal in Haryana not getting money? His networks would keep him posted and he would badger the mightiest in the land and get a hearing. Of course the needs of his scientist buddies got top billing.


The early attacks on the green revolution bothered him, particularly Keith Griffin and others saying that it was bypassing the small farmer and generating poverty. He was genuinely appreciative of Indian studies showing that the world of adopters was more equal than that of non-adopters (G.S. Bhalla’s Large Haryana study) and that small farmers went above the poverty line in Anand (Vijay Vyas’ work). He believed hunger could be ameliorated with widespread agricultural growth, and the Indians were his counterfactual to the Doubting Thomases in the world.


In the ‘80s, as I moved up in the planning and policy-making hierarchies, I was to meet him more often on my successive trips to Delhi. To the best of my knowledge, he was the first author of the bifocal strategy: that India will have to raise grain yields and release land for an agricultural economy diversifying to meet the needs of faster growth. He was chastened by some of the costs of the favoured crop — favoured region model and worried about land, water and carrying capacity. Later he was appreciative of the Indian UPOV (Union for the Protection of New Varieties of Plants) legislation and the Swaminathan model of a case-by-case examination of BT seeds and felt that it was a good compromise between the American/ Chinese push for very bullish policies and nay-sayers in Europe. But he was not too happy with the regulators being bureaucrats in what he felt was a scientific question of safety impacts. It delayed the process and brought in many irrelevant considerations to the debate.


A very wise universal man, in the sense of the poetry of the Gayatri Mantra. India and the world are poorer.


The writer, a former Union minister, is chairman, Institute of Rural Management, Anand








India has rightly been called the ‘reluctant nuclear power’. No other country in the world allowed twenty-four years to lapse between its first nuclear test and declaring itself a nuclear-weapons state. The Indian Defence Research and Development Organisation (DRDO) officially published the first study on the effects of nuclear explosions in the ’50s and it became a textbook for campaigners for the test ban treaty. No country campaigned as vigorously for nuclear disarmament as India, which was finally compelled to declare itself a nuclear weapons state because of the extremely delicate security situation in which it found itself. Two of its neighbours, with active disputes with India and who have fought wars with this country, are nuclear-weapons states with an ongoing proliferation relationship. Both of them have breached international norms on proliferation. Placed in this situation, India had to safeguard its security and yet found no reason to abandon its commitment to campaign for nuclear disarmament. India also had before it, the lessons of the irrational pursuit of a nuclear theology by major powers who built obscenely large arsenals at great cost ( subsequently were compelled to dismantle them at equally great cost). India has taken note of the joint declaration of President Reagan and Soviet General Secretary Gorbachev that a nuclear war cannot be won. After its first use in a situation of asymmetry, when it was dropped on a nation attempting to negotiate its surrender, nuclear weapons have not been used in the last sixty four years.


There is a near-universally shared perception that deterrence has worked and the Indian official nuclear doctrine is based on this premise. However there are, as is to be expected — especially in an argumentative country — different views on its interpretation and scope. That leads to espousals of differing strategies and policies.Therefore, a rigorous examination of the concept of deterrence is called for.


Most of the literature on nuclear deterrence has been produced by US strategists, and they relate to a two-player game between the US and USSR. In the initial stages of the Cold War, the US used the perceived Soviet conventional superiority in Europe as justification for developing tactical nuclear weapons. Then, the vulnerability of airborne forces to a totally disarming strike (the ‘delicate balance of terror’ thesis) led to the development of silo-based and submarine-based missiles. Very fanciful assertions of the punishment the Soviets were capable of accepting, in terms of population and industry loss, became the basis for hiking up the requirements of these silo and submarine-based missiles. Then came the technology of multiple warheads. The final result was an arsenal exceeding 20,000 warheads on each side. While the USSR, in the initial stages, was able to exercise deterrence vis a vis a vastly superior nuclear arsenal of the US with a fraction of that number, in subsequent years it expanded its arsenal to match and exceed that of the US — mostly to seek parity in terms of super-power status. Though the USSR espoused an aggressive ideology, a basic feature of that ideology was that the direction of history was inexorably in one direction; the USSR need not push it militarily in areas of vital interest to the West, but should take advantage of opportunities in the developing world. The result of this approach was that USSR behaved almost like a status-quoist power, very rarely threatening the US directly. The only crisis when the homelands of both powers came under threat was the Cuban missile crisis.


While the nuclear deterrence between the two super-powers operated without any external constraints, that was not the case in the game of deterrence between other powers — such as, for instance, between China and the USSR. The Chinese, following Soviet warnings of potential escalations in the border confrontation, decided to make a complete U-turn in their policy, respond to US overtures, and have a tacit alliance with them — thus enhancing uncertainty for the Soviets in any nuclear threat towards the very weak nuclear China of the ’70s and ’80s. The game of nuclear deterrence among the lower-rung nuclear nations must necessarily take into account the potential behaviour of the two foremost nuclear powers, which are in the case of India and Pakistan beyond the possibility of any realistic retaliation. There is not much, if at all any, literature on the game of deterrence among the second- and third-rung nuclear nations under such conditions of uncertainty. So we have to think for ourselves.


Deterrence has been defined as discouraging someone from doing something by instilling in them the fear of consequences. In India’s case, it would mean that the ability of the country to retaliate against a nuclear attack on it by either of its two nuclear neighbours, should be credible to the potential adversary. In other words, the retaliation should result in unacceptable damage in terms of population and property. However, deterrence is not a function of the exchange ratio of the damages inflicted by both sides. It is directly related to the population and property damage which the aggressor will calculate he can accept in the inevitable retaliation that is bound to follow his initial nuclear attack, irrespective of its magnitude. In today’s context, when missile defence is still to become optimally effective, so long as India has a survivable retaliatory force, the punishment is certain. Even a fission warhead of 15 kilotons will cause more than 100,000 immediate fatal casualties in the densely populated cities of South Asia and China. It is immaterial if a 100 kiloton warhead flattens a major city or if that is done by three smaller 15-kiloton warheads. Deterrence depends on the adversary’s perception of the explosive yield that will be delivered on his cities by a retaliatory strike. There are both advantages and disadvantages in delivering the retaliation in big packages with fewer delivery systems, or with larger numbers in a distributed way. The crux of deterrence is survival of the retaliatory force and the adequacy of the survived force to inflict unacceptable punishment.


There can be all kinds of fanciful calculations on what would constitute unacceptable punishment, and what would be the survivability factor of one’s own force against the adversary’s first strike of different magnitudes. The adversary cannot disarm himself in his first strike and he should have enough warheads left after he is hit by retaliatory strikes. Then, allowances have to be made for failures of warheads and failures of delivery systems, and delivery vehicles missing the target by a large margin in the exchanges between both sides. Depending on the mental and emotional make-up of the calculator, the figure can vary over a large range. In the real world of today, will even 6-10 hits by fission warheads, let alone 100-kiloton thermonuclear warheads, be considered acceptable to attain a conceivable strategic, political, or economic objective? Exercise of a credible deterrence calls for sound judgement on this issue.


(To be concluded)


The writer is a senior defence analyst








Kambakht Akshay Kumar. Stands there looking like a work out gym in designer casuals and a scarf (scarf?), clucking his tongue (tsk, tsk) at the women because they are slow in surviving the spiders. Lectures them on bravery like he had conquered Mount Everest or earned a Param Vir Chakra. Compliments them, encourages them but mostly he patronises them and scolds them till they’re feeling like the insects they’ve just parted company with — small. The man’s a downright sadist, that’s what.


Everybody loves Akshay Kumar. For his prowess, his film stunts, his ability to never take himself too seriously and to laugh at himself. Those wonderful characteristics are missing from Fear Factor Khatron Ke Khiladi Level 2 (Colors). This Akshay Kumar is a bully and should shift his gig to Dadagiri (Bindass) where they appreciate that kind of thing.


Ideally, he should lead the way, beat the odds and challenge the contestants to join him or best him. Why doesn’t he — and other Bollywood stars who play anchor — climb inside one of those plastic coffins and fight off the beasties, himself? That would be the Akshay Kumar thing to do. And a sure fire bestseller. But no, he struts about, watching women more than half his size attempt these foolish, foolish dares while he pats them on the shoulder, awards them safety belts (whatever) and advises them to conquer fear. That’s downright ungentlemanly.


The show is unwatchable after a few minutes. We’ve had our fill of this man — or in this instance, woman — against nature contest with the first season Fear Factor and more recently by Iss Jungle Se Mujhe Bachao (Sony), Mandira Bedi notwithstanding. At 9 pm, we want something rather more appetising than scorpions.


Some of us may think Amitabh Bachchan fits the menu. In promos for Big Boss, he’s looking fit, trim (body and beard) and rather inviting as he welcomes us to an all new show, coming shortly to Colors. What he’s doing in what looks like a smoking jacket when we’re sweat suits in our bare skins, only the producers know — TV people should dress according to the seasons, or no? Being the original Big B, he’s trying to elevate the show to his heights (pun unintended) by suggesting a psychological twist: is this merely entertainment (yes it is) or a chance for us to get to know ourselves better through the inmates of the Big Boss house?


Time for 12/24 Karol Bagh (Zee). After such a long while, a serial based in Delhi that looks like Delhi, smells of Delhi’s sweet houses and even speaks and behaves like Dilliwallahs. A middle-to-do family in KB tries to gets its plump 28-year-old daughter off its hands by palming her onto short and stout Golu. Golu and his friends behave like ‘locals’ and the more sophisticated girls are appalled at their uncouth mannerisms. Moreover, Golu appears to be a womaniser. Still, our heroine is willing to have him because nobody else will have her. Besides, her younger brother wants to marry but can’t until ‘didi’ takes up with Golu. So far, the show is well-executed. It has captured, if not the heart of Delhi, at least some body parts.


A certain Mr Doraiswamy from the Met Department told Doordarshan on Saturday night that it would continue to rain in Delhi and northern India throughout Sunday, although not as consistently as it had last week. When we awoke to bright sunshine Sunday morning, we thought this isn’t 12/24 Karol Bagh or indeed, Delhi. Why do weathermen make such categorical predictions on national media when past experience should have taught them the error of their ways?


Do commend DD, however, for persisting with public service spots when nobody else bothers. Last week, saw a series of ads on smoking, adulteration and for proper health care of infants. That’s more like it.












Plenty will be written about the state of global finance, particularly US finance, in the course of the anniversary week of the Lehman Brothers collapse. A year ago, critics of liberal finance may have actually been looking forward to writing a final obituary of Anglo-American finance (if not global capitalism) on September 15, 2009, but things have turned out rather differently. In the interim, critics of liberal finance have heaped much praise on over-regulated financial systems, like those in India, without for a moment considering the price an average business or consumer in India has to pay for that illiberal system. Of course, there is no denying that Indian banks did not collapse like the way some major US and European banks did. They still make good profits. But that basic function of banking and finance extends beyond profitable companies: they must be a source to channel credit, at reasonable rates, to productive sectors of the economy. Indian banks, by largely sitting on their cash reserves or at best parking them in the safety of G-secs and mutual funds, have failed to make a significant contribution to a sputtering Indian economy over the last one year.


It is now well established that the global economic crisis shaved 2-3 percentage points off our growth rate. This was in no small part due to the drying up of cheap funds from abroad. If our banks were indeed safe and profitable, they should have weighed in to make up for the shortfall in capital facing industry and consumers and one isn’t arguing in favour of subprime lending. Even prime lending rates charged by commercial banks over the last year have been in double digits and hardly responsive to rate cuts initiated by RBI. It is hardly surprising that both investment and consumption have taken the hit they normally do after a loss of confidence. The excess conservatism of banks, which reflects in no lending to prime borrowers either, may, however, have actually exacerbated the slowdown in India. Indian banks and financial institutions may have missed another trick in their obsession with their individual bottomlines. The crisis was a great opportunity for solvent, profitable banks to buy out temporarily struggling—but with future potential—banks in the most troubled economies. A number of Japanese banks capitalised on this opportunity. But did you hear of any Indian bank even considering a takeover? The major part of the problem lay in the fact that the most profitable banks were in the public sector and they have little freedom to take their own commercial decisions. SBI, for example, could have potentially moved a level up in this year of crisis. Instead, SBI and Indian banking stand where they were a year ago while western finance has gone all the way down and is rising past our conservative bankers quite quickly.







Comparisons, apart from being inevitable, are instructive. But they can also be a problem. In all one-year-since-Lehman commentaries that concentrate on the Indian experience, growth comparisons with the rich world are both inevitable and instructive. But such comparisons are also a problem in that they can distract from India’s main economic job, which is to get back to 8-9% growth as soon as possible. It feels good to grow at 6%-plus when the World Bank had predicted a 4% growth rate for India and when much of the rich world is getting used to positive growth territory again. But if Indian policymakers decide at this point of time that this is satisfactory, the chances of a fall in trend growth, chances that are always there, can horribly brighten. One year after the crisis, with the Indian economy in recovery mode, is when policymakers should be getting ambitious again. China has already decided that 8% growth is feasible. So must India. This means strategic focus on domestic private investment. Everyone knows this is the key growth driver. But no one is sure what the policymaking establishment is doing to seriously engage it. There are two kinds of investment encouragement policymakers can provide. First, through mood change, and this has an important, but short-term effect. Second, through policy change, this has crucial longer-term impact. Factor in with this the need for timing the exit from fiscal and monetary policy stimuli. Fiscal policy stimuli in terms of high government spending and select indirect tax cuts should be exited sooner rather than later, if only because the fiscal correction path that was abandoned needs to be walked again. The next Budget must do this. The monetary question is much more complicated, as these columns have argued. The price and quantum of credit are not satisfactory and an early exit may severely affect investment. Indeed, the case still exists for doing more to bring down lending rates.


What about mood changers and policy changes? UPA-II can change the mood by being consistently serious about disinvestment, by passing the reformist Bills that have been in the system for years now and doing something really substantive about land acquisition. This means more than rescuing the land acquisition Bill from the clutches of the Trinamool Congress. This will require the Congress to take political ownership of the process, like it does for social welfare programmes. If the Congress’s DNA won’t let this happen, we are looking at a big investment constraint. As for policy changes, some good work is taking place in roads finally, but in power, coal, ports and mines, there’s virtual policy stasis. We need a few big ideas and then the implementation of those ideas. Otherwise, the new Hindu rate of growth will be 6.5%.








As we examine what we have learnt in the year since the collapse of Lehman Brothers, the most important lesson for Indian policymakers is that for macro risk management purposes, India must now be regarded as having an open capital account.


From a micro-economic perspective, India has a plethora of exchange controls that often force businesses to go through several contortions to perform what would be very simple tasks in a completely open capital account. But from a macro perspective, these regulations only serve to impose some transaction costs and frictions in the process. Exchange controls have ceased to be a barrier—they are only a nuisance.


Large capital inflows and outflows do take place through three important channels which are not subject to meaningful cap—inward portfolio flows, outward foreign direct investment and external commercial borrowing. In addition, foreign branches of Indian banks and foreign affiliates of Indian companies have relatively unrestricted access to global markets. Through all these channels, Indian entities can build up large currency, liquidity and maturity mismatches in foreign currency.


Each one of these global linkages was well known to perceptive observers for a long time, but it took the Lehman collapse to demonstrate the strength of these linkages taken together. Policy makers were taken by surprise at the ferocity with which the storm in global financial markets hit Indian markets.


We must now wake up to the reality that as in the case of East Asia in 1997, the power of the corporate lobby has ensured that capital controls have disappeared in substance while remaining deeply entrenched in form. I believe that in India today, there are only three effective capital controls that have macro consequences.


First, Indian resident individuals cannot easily borrow from abroad. This ensured that Indian households did not have home loans in Swiss francs and Japanese yen unlike several countries in Eastern Europe. In India, the corporate sector has had the monopoly of speculating on the currency carry trade. From a socio-political perspective, this mitigated the impact of the crisis, though it is doubtful whether the macro-economic consequences were important.


Second, Indian companies cannot borrow in rupees from foreigners as easily as they can borrow in foreign currency. This contributed to large corporate currency mismatches which were a huge source of vulnerability during the Lehman crisis.


Third, it is difficult for foreigners to borrow rupees and therefore speculation against the rupee is more effectively carried out by Indians than by foreigners. Currency speculation by foreigners typically takes the form of portfolio inflows and outflows. This has potential macro prudential consequences, but it was not a material factor in the Lehman episode.


This, therefore, is the first lesson from Lehman— Indian regulators should now think of India as having an open capital account while framing macro risk management policies.


The second lesson is that, as Mervyn King put it, global financial institutions are global in their life, but national in their death. Each nation has to take steps to ensure that failure of foreign institutions does not disrupt its domestic markets.


The collapse or near collapse of several large US securities firms did not pose any threat to the solvency of Indian equity markets because of the margin requirements that we impose on FIIs. Under the doctrine that each country buries its own dead, foreign creditors of a bankrupt FII can lay claim to this collateral lying in India only if there is something left over after the claims of Indian stock exchanges and other Indian entities have been satisfied.


In this context, the existence of a large over the counter (OTC) derivative market in India where foreign banks trade without posting margins is a huge systemic risk. Lehman was a bit player in the interest rate swap and other OTC markets in India. As such, its collapse did not create a major disturbance. However, the failure of a large foreign bank which is very active in the OTC market would be very serious indeed.


It is absolutely imperative to move the OTC markets to centralised clearing to eliminate this source of systemic risk.


The final lesson from Lehman is that the idea that emerging markets are somehow very different from mature markets has been rudely shaken. The most mature economies of the world have had an “emerging market style” financial crisis. In the past, the US did not think that it had anything to learn from crises in emerging markets, and was therefore completely unprepared for what happened after Lehman. In retrospect, the US belief in its own exceptionalism was a colossal mistake.


India must also abandon any belief we might have in our exceptionalism and learn from the experiences of other countries so that we do not have to learn the same lessons at first hand.


The author is a professor of finance at IIM Ahmedabad








One year into the biggest bankruptcy in US history, a year in which bankers and their bonuses have drawn vitriol across the political spectrum, we ask how American TV and Hollywood are feeding off this fresh new meat of material. In a very reserved way. This is surprising on the one hand, given how the US culture machine’s reputation has, for a large part, been built on its ability to churn out commentaries on critical events faster than we can say how do you do. Fahrenheit 9/11, 9/11, World Trade Center and United 93, for example, offer varying treatments of the most significant event concerning US political presence in today’s world. TV dramas like 24 were even quicker in delivering commentaries. Why didn’t Lehman draw a similarly speedy rejoinder?


The answer may point to a fundamental misunderstanding of American popular culture’s relationship with its Richie Rich class. After watching Oliver Stone’s Wall Street in 1987—a sequel is on the way—Roger Ebert wrote that it was a radical critique of the capitalist trading mentality, especially powerful because it came at a time when the financial community was vulnerable—“What the Gekkos do is immoral and illegal, but they use a little litany to excuse themselves: Nobody gets hurt. Everybody’s doing it. There’s something in this deal for everybody.” That’s certainly one truth about Wall Street. The other is that, to this day, Michael Douglas finds himself buttonholed by bankers who hail his Gordon Gekko character, and cry out: “You’re the man. You’re the reason I got involved in this business.” The other truth is that there are some villains Hollywood just loves to make other people love too.


Take shows like Entourage and Dirty Sexy Money, all of which star characters living in amazing mansions, eating at expensive restaurants, attending celebrity charity galas and wearing designer clothes. They have much to do with banks, hedge funds and the like, which finance their charities, films, mansions etc. Ratings suggest that watching wealth is still a favoured pastime for those losing wealth, home values and 104Ks. But how banks or hedge funds or investment agents work hasn’t moved centre stage. A simple explanation is that bankers perform action that’s hard to capture in images , say making a margin on interest income over cost of funds. How do you dramatise credit default swaps? But, aren’t TV shows about human interaction? Whatever Michael Douglas was up to in Wall Street or Russell Crowe in A Good Year could be turned into a solid dramedy. Surely, that wouldn’t be harder to show than the stuff-expanding franchises like CSI? Actually, it would. CSI may represent a supersonic advance, but it’s still based on traditional cop stuff, common fodder for American TV for long. Scrubs and Grey’s Anatomy similarly build on the established medical genre. So, perhaps it’s the want of precedence that’s done the downer on a Lehman show.


As famous as the US popular culture machine is for its insatiable appetite for controversial material, it’s also a child of convention. At the peak of the Great Depression, US unemployment was at 25% but 60-70 million Americans were dishing out hard-earned 15 cents to pack the theatres every week. President Franklin Roosevelt said that when the spirit of the people was low, it was a splendid thing that they could look at the smiling face of a baby and forget their troubles. Certainly, films like Modern Times (1936) cushioned economic hardships in comedy. The Wizard of Oz (1939) offered comfort in mythic terms. Failed farmers were pictured poignantly, as in Grapes of Wrath (1940), filled with the debris of farm foreclosures. Finally, and most pertinently for today, there was It’s a Wonderful Life (1946), where the Christmas spirit rises against a bank run. James Stewart got everyone on the bank’s side, crying: “Just a minute. You’re right when you say my father was no businessman. I know that. Why he ever started this cheap, penny-ante Building and Loan, I’ll never know. But neither you nor anyone else can say anything against his character, because ... he never once thought of himself.”

It’s an oft-proven thesis that the US culture industry moves in advance of the times, and that its intuitive representation of the American psyche is accurate more often than not. If that’s the case, it would seem that the country’s soothsayers aren’t quite convinced about audiences being ready to bash up the bankers. Sure, you could argue Michael Moore’s Capitalism: A Love Story, but that hasn’t got quite the play that Fahrenheit 9/11 got, even on the festival circuit. In desperation, you could even shout out Martin Scorsese’s upcoming The Wolf of Wall Street. Quite apart from the fact that it’s based on a 1990s securities fraud, what are the odds that Leonardo DiCaprio will truly be a bad guy?








In the 1960s—the time of one of the worst food crises in India—it had seemed that the Malthusian theory was correct and the country’s population was exceeding its ability to feed its citizens. With the threat of famine looming large on the country, the government solicited help from abroad. It imported huge quantities of grain from the US. This was followed by import of new varieties of wheat and grain to be grown in India’s soil. The green revolution meant development of higher-yielding seeds and unprecedented expansion in the use of irrigation, fertilisers and pesticides in developing countries. Norman Borlaug, the father of green revolution, brought Indo-US ties to a new level. Borlaug, who died on Saturday, was often credited with saving over a billion people worldwide from starvation.


Borlaug, a Norwegian-American born in Iowa, received his PhD in plant pathology and genetics in 1942 and took up an agricultural research position in Mexico. By cranking up a wheat strain containing an unusual gene, he created the so-called ‘semi-dwarf’ plant variety which led to Mexico becoming a net exporter of wheat in 1963. World food production more than doubled between 1960 and 1990 and in Pakistan and India, two of the nations that benefited most from the new crop varieties, grain yields more than quadrupled over the period. He was one of the only five people in history to score the feat of winning the Nobel Peace Prize, the US Presidential Medal of Freedom and the Congressional Gold Medal. Yet, he was barely known in the country of his birth. Agriculture in India is not an occupation but rather it’s a way of life as more than 65% of the population is directly employed in it. It may contribute only 17% to GDP but the challenges faced by it are as gigantic as faced by physical infrastructure. Green revolution had created a sense of elation that we have resolved our production problem. But, now we have reached a plateau in production and productivity. There is a dire need to follow a multidimensional approach towards agriculture. Indeed, what is now required is a second green revolution to increase productivity and take people out of low returns farm jobs. We need another Borlaug-like inspiration.








Norman Borlaug, who died in Dallas, Texas on September 13 at the age of 95, remains the only recipient of the Nobel Prize for agriculture, specifically the Peace Prize of 1970. Possessed of insatiable curiosity about matters botanical and blessed with remarkable energy and scientific incisiveness, Dr. Borlaug (with Rockefeller Foundation funding) worked in Mexico in the 1950s, where he crossbred a ‘dwarf’ strain of wheat. This, when treated with chemical fertilizers and pesticides, produced far greater quantities of seeds than the earlier varieties had done. His discovery was commercially introduced in Mexico in 1956, and the 1963 harvest was six times greater than that of 1944. The obvious place for the further use of the new strain was South Asia, which in the 1960s faced runaway population growth, stagnating agriculture, repeated monsoon failures — and mass hunger. So desperate was the situation in India that Food Minister C. Subramaniam overrode scientists’ phytosanitary concerns and the Finance Ministry’s objections to gain parliamentary approval for importing the new wheat strain. The rest is the stuff of legend. In Pakistan, wheat yields doubled and by 1974 India was self-sufficient in cereal production.


Dr. Borlaug, who shrugged off the title of ‘Father of the Green Revolution,’ never ceased his research and teaching; neither did he disregard wider socio-political issues. While there were mixed reasons why African increases in yields did not lead to a Green Revolution, Dr. Borlaug is said to have regarded peace and security as prerequisites for agricultural success. He also came to see that certain concerns over the environmental impact of chemicals are justified. He advocated genetic engineering as an extension of conventional techniques. He was a severe critic of those he saw as elitist environmentalists and of western agricultural subsidies. Dr. Borlaug often said that if his critics had seen the effects of mass hunger, as he had done daily for 50 years, they too would want to use technology to feed people. The battle against hunger continues. The U.N. estimates that a billion people are currently malnourished, and by another estimate one third of the Indian population are eating a third less than they were in 1975. Dr. Borlaug, in sustained association with visionary scientists like M.S. Swaminathan — who has characterised him as “the greatest hunger-fighter for all time” — made a profound difference to the lives of hundreds of millions of people in the developing world. The game-changing science and humanistic spirit of this 20th century work need to be replicated, if the new challenges are to be met in the coming decade.






The settlement reached between the Jet Airways management and pilots late on Saturday night has come as a relief to passengers. The strike, even if the pilots chose to call it ‘sick leave,’ paralysed operations for five days, forcing the leading private airline to cancel 200 to 250 flights per day. It also meant a revenue loss of Rs.200 crore over the strike period. In a bid to boost the bookings, Jet Airways has even offered a 50 per cent discount for passengers travelling from September 14 to 18. After last week’s disruption, the passengers may want to wait for normality to return in the airline’s operations. Though the protest by the pilots, who joined the National Aviators Guild seeking the right to form a trade union, left the stranded passengers complaining, the management was in no position to deny that right of association. Even after the settlement was reached, Executive Director Saroj Dutta kept speaking about a consultative group to address all the issues raised by the pilots. His argument was that a union was not necessary to deal with the problems of the staff, especially the pilots. But there was no word from the pilots, including those reinstated, about their giving up the membership of the guild.


Whatever the agreement, or the redoubled efforts to get back to normal operations, the image of Jet Airways has undoubtedly taken a hit. It is not merely the revenue loss that should be worrying. No airline can afford a disruption in service at this juncture when air travel is down and the carriers are facing huge losses. Some of the private airlines even tried to make a fast buck by doubling their fares, prompting the government to step in and ask them to stick to the fares prevailing earlier. It will take a while for Jet Airways to win back the trust and confidence of those who were put to hardship by the cancellation of flights, especially foreign operations. The Jet management must realise that the right to form unions is a fundamental right which cannot legitimately be denied. Be it in Britain or the European Union, the right to freedom of peaceful assembly and to freedom of association, including the right to form and to join trade unions for the protection of interests, have been guaranteed. Jet Airways will do well now to build on its brand image, continue to offer the kind of services — on ground and in the air — that it did earlier, run to a near 100 per cent punctuality in operations, and regain the endorsement of passengers that had won for it so many awards in the past. At a time when competition in the air is getting tough, good service can make a huge difference.









The twin goals of Indian economic planning have been rapid all-round economic growth and equitable sharing of the fruits of development. The country has made significant progress in realising the first objective. But the second goal has remained elusive. After six decades of planned economic development, the disparities have widened and some three-quarters of the population are mired in poverty. The world financial crisis offers an opportunity to make a course correction and advance towards inclusive growth.


It is generally agreed that the Keynesian prescription of stepping up public spending for the management of aggregate demand is the most potent weapon to fight a recession. The Indian government has already initiated action on the right lines by enhancing outlay on infrastructure, particularly on highways, power and other public works, the NREGA, supply of foodgrains to the poor at subsidised rates and so on. But more needs to be done. Here are some specific suggestions to help the disadvantaged by giving them access to quality school education.


The main reasons for India’s failure to achieve inclusive growth and distributive justice are the failure of land reform, the wrecking of the well-designed community development programme that aimed at the all-round development of the village, the lack of success in providing adequate employment opportunities at living wages to a rising population, the neglect of school education and the absence of special measures designed to help children of the poor to get a good school education.



The significant weakness of the Indian economy is the continued dependence of some 60 per cent of the workforce on low-productivity agriculture and allied occupations for employment and living. The efforts made since Independence have led to only a small decline in the percentage of the population dependent on agriculture. In that period, the share of agriculture in the gross domestic product declined by more than one half, resulting in great distress. Even if we achieve an annual growth of 10 per cent or 12 per cent in industry, there will be no substantial decrease in the dependence on agriculture.


Furthermore, it is high time we took note of the tectonic shift that has taken place in the nature of industrial employment. In the early stages of industrialisation, rural workers could migrate to the cities and seek employment in the textile mills of Bombay, Ahmedabad or Coimbatore, or the Tata Iron and Steel mill at Jamshedpur, for instance. That is no longer possible. The doors of modern industry will open only to those with good schooling and the relevant skills. This is equally true of the service sector which has grown fast in recent years. With the onset of the IT revolution it has become obligatory for new entrants to acquire even higher levels of skills. Hence it is a matter of urgency to provide adequate facilities for quality school education and impart relevant skills to the disadvantaged.


The policymakers who introduced reservation for the disadvantaged in institutions such as the Indian Institutes of Technology and the Indian Institutes of Management without ever bothering to give them access to high-quality school education put the cart before the horse. What the politicians really did was to invite the disadvantaged to a veritable Barmicide’s feast! Only the so-called creamy layer benefit from reservation. The most effective affirmative action in the field of education would have been to provide adequate facilities for quality school education to children of the weaker sections.


In any purposeful programme to achieve inclusive growth, the pride of place should go to education, particularly quality school education. In this context, the Prime Minister’s announcement about opening 6,000 Navodaya-type schools is welcome. Prime Minister Rajiv Gandhi took a laudable initiative by opening the Navodaya schools. Unfortunately those schools ended up catering to the elite. What is now needed is to reserve 50 per cent seats in existing and future Navodaya schools for children of the disadvantaged. This simple, inexpensive step will be a boon to the poor.



Apart from opening schools, the working of existing government schools should be improved as a matter of priority. Some six decades ago, government schools were among the best institutions in the country. But today most of them are in bad shape. While there are numerous expensive private schools to cater to the needs of the affluent, the poor mostly depend on government schools.


Hence the need to improve the functioning of government schools without losing more time. There is also a need to expand and modernise teacher-training facilities. In order to attract better talent, it is necessary to improve the emoluments of teachers. A society that compensates clerks in government offices and banks more liberally than teachers cannot expect the talented to opt for teaching.


Opening of schools and improving the functioning of government schools will not automatically confer great benefits on the poor. Special steps are needed to enable students to make use of the facilities. The greatest handicap that poor children face is that at home they do not have an ambience conducive to the pursuit of studies. This drawback can be overcome to a large extent if they are lodged in hostels equipped with good tutors to guide them.



The establishment of schools and the improvement of government schools will take time. The provision of quality school education to children of the poor is crucial and we cannot afford to wait. A practical solution is to reserve seats in existing good schools and provide hostel accommodation and special tuition. It should be possible to reserve at least 10 per cent of seats in each class in all Central schools, Sainik schools and good government schools. Additionally, good private schools, including those run by Christian missionaries and others, should be persuaded to join the endeavour. The government should, of course, give the institution ample grants to cover capital and recurring expenditure. Each student should be given a scholarship sufficient to meet all legitimate expenses. Public schools such as the Doon School, the Rishi Valley School and so on, good missionary schools like St. Columba’s and Jesus and Mary in Delhi, and others like the Delhi Public School, should become a part of this.


There should be a caveat added here. Great care should be taken in selecting the schools. There is the danger of unsuitable institutions trying to gatecrash to avail themselves of the generous financial assistance. Recent years have witnessed a mushrooming of so-called English medium schools of poor quality started for commercial reasons. Such schools should be left out. In each State, a small committee consisting of knowledgeable persons of integrity should be set up to select the schools. If serious efforts are made it should be possible to admit at least one lakh poor students in good schools over the next few years. If successfully implemented, this may turn out to be the most effective affirmative action attempted so far.


Though we have succeeded in modernising the economy and the country has registered remarkable industrial and agricultural growth, we have failed to ensure that a fair share of the growth accrues to the poor. The present recession is an opportunity to reverse the trend and implement programmes aimed to achieve inclusive growth. Investment in school education should be stepped up in order to help the poor get quality schooling. The other areas that cry out for attention and enhanced allocations are an enlarged and revamped NREGA, public health and medical care, a reorganised public distribution system targeting the poor and augmented housing facilities for the poor, both urban and rural. There is also a dire need to revamp the delivery mechanism, making it more efficient and accountable.


All these measures will necessitate a substantial additional outlay pushing the fiscal deficit a little above the projected 6.8 per cent. Considering that these steps are needed to make a course correction and ensure inclusive growth, the risk is a justified one to take. A polity that incurs colossal wasteful expenditure on a bloated government machinery, some avoidable subsidies, the supply of free electricity to prosperous farmers, distribution of free colour television sets, the installation of statues of megalomaniac politicians and so on should not grudge a large outlay on projects targeted to benefit the weaker sections. If an amendment to the Fiscal Responsibility and Budget Management Act 2003 becomes necessary, the Government of India should amend it without hesitation.


(P.S. Appu is a former Central Land Reforms Commissioner and a former Chief Secretary of Bihar. He can be reached at










Disappointed at what they say is a “package of gimmicks,” the people of the remote region have voiced protests against the Gilgit-Baltistan (Empowerment and Self Governance) Order 2009.


But they are also leery of New Delhi’s diplomatic protest against it, saying they are as much victims of India as of Pakistan.


Gilgit-Baltistan is the northern-most territory governed by Islamabad and an important element in the India-Pakistan wrangle over Kashmir. It is also in the middle of a geo-strategic hot-spot.


To its north, it shares boundaries with Afghanistan and China’s Xinjiang Autonomous Region; to the west is Pakistan’s troubled North-West Frontier Province; to its south is Pakistan Occupied Kashmir; and to the east, India’s Jammu & Kashmir state.


New Delhi claims it as part of J&K, and therefore as an integral part of India. Pakistan also links the region to the Kashmir issue, but in contrast to “Azad Kashmir” or Pakistan Occupied Kashmir, has kept the territory in a constitutional limbo, referring to it until now only by the geographical appellation of Northern Areas.


About the only thing that has been welcomed in the autonomy package is the renaming of the area as Gilgit-Baltistan, which better conveys that people with a distinct identity live in that region.


Identity is key to the grievances of Gilgit-Baltistan people, estimated at 1.5 million since the last count in 1998. They do not consider themselves Kashmiri and have little in common with them. The majority are Shia, and a significant number are Ismaili. They belong to several non-Kashmiri ethnicities, and speak a host of languages, none of which are Kashmiri.


Their first link to Kashmir came with the British sale of the region to the Dogra ruler of Jammu and Kashmir in the 19th century. After many twists and turns over 100 years, the people of the territory successfully rebelled against the maharaja on November 1, 1947. They put their future in the hands of Pakistan but found the clock turned back on them when Pakistan linked their fate to that of the Kashmiris.


Accepting Gilgit-Baltistan’s accession would have undermined Pakistan’s international case for Kashmir. In later years, Pakistan did not want to forego the votes from Gilgit-Baltistan in the event of a plebiscite on Kashmir.


But unlike PoK, which got some make-believe autonomy, the Northern Areas remained an undefined entity.


Analysts believe the remoteness of the region, its scattered population, the absence of links between local leaders and the Pakistani leadership, all combined to deny Gilgit-Baltistan the comparative political largesse bestowed on PoK.


The territory came under direct rule of the federal government through the Ministry of Kashmir and Northern Areas (KANA). The military had a big role in administering the region. In 1974, Zulfikar Ali Bhutto ushered in a directly elected “council” but left the administrative system untouched. More reforms packages followed in 1990s, and by the Musharraf regime in 2007, when it was on its last legs. Each promised “maximum autonomy” but contributed only cosmetic changes. To date, the people of the region are only de facto citizens of Pakistan.


The Gilgit-Baltistan (Empowerment and Self Governance) Order 2009 of August 29, signed by President Asif Ali Zardari on September 7, yet again promises maximum autonomy to the people of the region.


Under the package, Gilgit-Baltistan will have a Governor as in the other four provinces of Pakistan, without constitutionally being made a province. The leader of the Legislative Assembly will be known as chief minister; the Assembly will have 33 members, of whom 24 are to be directly elected; it will have powers to legislate on 61 subjects.


In addition, the Governor will head a 12-member Council, with half the members from the Assembly and half appointed by the Governor. A fresh election for the Legislative Assembly is to be held by November. The territory will also have its own chief election commissioner, a public service commission.


The government has described it as a “province-like” status for Gilgit-Baltistan. But the new measures have failed to satisfy any segment of the Gilgit-Baltistan population.


Those demanding self-governance see it falling well short of empowerment of the local people. Instead, they see the package tightening the federal government’s hold by the appointment of a Governor. The Council is seen as a move to dilute the Assembly’s powers. While the Assembly has been given powers to pass the budget, it does not spell out how much say the Chief Minister will have in framing it. The Assembly does not have the right to legislate on its natural resources, including water and minerals.


Nationalists, whose demand for independence has gained ground over the years thanks to the denial of basic rights to the region, have also rejected the package.


“Pakistan did not consult anyone in Gilgit-Baltistan for this package. The provision for chief minister and Governor is illegal because this is not a province of Pakistan,” said Shafqat Inquilabi, a former spokesman of the nationalist Balawaristan National Front.


“We are a separate state,” the young activist said, and the least Pakistan could do, according to him, was to treat it on par with Azad Kashmir until the resolution of the Kashmir issue.


“We are the fourth party to the Kashmir dispute and we must be included in the talks as such,” he said.


Human rights activists have rejected it saying Pakistan has yet again failed to make any constitutional arrangements for the people of the territory, while those demanding complete integration with Pakistan say it has fallen short of their demand that the territory should have been incorporated as the fifth province of the country.


Bar the PPP, national mainstream political parties active in the region view the package as “pre-poll rigging” for the fresh Legislative Assembly election.


Opposition has also come from Kashmiris, who have seen in it an insidious move by the PPP government to dilute their cause by giving a region internationally considered a part of the Kashmir issue a province-like status within Pakistan.


But it has rankled the people of Gilgit-Baltistan even more that while moving to assuage the fear of the Kashmiris —Foreign Minister Shah Mahmood Qureshi held a special briefing for PoK leaders on September 4 — the government did not take them into confidence even after announcing the package.


Instead of winning hearts and minds, the package has spurred a major debate on the motives behind it. The Kashmiris see pressure from the U.S. or Indians as the reason for the package as according to them, it is a move by the PPP government towards a tacit acceptance of the status quo on Kashmir.


According to one theory being circulated in the blogosphere, the government had hoped the package would act as a sop to clam down opposition in Gilgit-Batlistan to the government plans for construction of dams in the region.


During a recent visit to China, President Zardari signed an MoU for the Bunji Hydroelectric Project in Astore, to be constructed by the Chinese on a “Build, operate, transfer” basis. The dam, estimated to cost up to $7 billion, all of it to be invested by the Chinese under the BOT agreement, will have a capacity to generate 7,000 megawatts of electricity.


Some think China, with its high profile investment in several projects including telecommunications, the expansion of the Karakoram Highway, and the construction of a dry port on the Xinjiang border, is behind the government’s latest move keen that there should be no unrest in the region.


“Without a legitimate government in the area, no outside power in the region has a right to start any infrastructure project. We will consider it illegal and illegitimate unless there is a representative government in Gilgit-Baltistan,” said Ali Ahmed Jan, a founder member of the Karakoram Students Movement, now an Islamabad-based human rights activist.


Some also see it as a move to pacify Western donors concerned about the denial of rights to the people of Gilgit-Baltistan.


Last week’s protest by India to Pakistan against the Gilgit-Baltistan Order and the proposed construction of the Bunji dam, has also drawn criticism.


Describing the people of Gilgit-Baltistan as the “worst victims of the India-Pakistan dispute”, Mr. Jan pointed out that they were left out of the numerous confidence-building measures of the peace process. A Skardu-Kargil bus route was proposed but never implemented.


“India’s opposition to the package is unjustified unless it can come up with a plan that will give relief to the victims of the Kashmir dispute,” said Mr. Jan. Pakistan had attempted to do this, he said, even though “it is another matter that what they have given is simply not enough”.








The fall of the Berlin Wall in November 1989 was hailed in the West as a seminal moment in its “struggle” against Communism and sparked a wave of euphoria. But, it has now emerged, that behind those euphoric public pronouncements there were deep anxieties in most European capitals, especially in London and Paris.


Indeed, neither Margaret Thatcher, the then British Prime Minister, nor French President Francois Mitterrand wanted the wall to come down as they feared that a unified Germany would be a “threat” to European security.


Mrs. Thatcher was so concerned that two months before the fall of the wall she travelled to Moscow to plead with Soviet leader Mikhail Gorbachev to intervene and stop the break-up of East Germany. In Paris, meanwhile, Mr. Mitterrand was deploying Gallic humour to voice his concern saying: “I like Germany so much I would prefer to have two of them.”


Even at the time, it was known that there was nervousness in Europe at the prospect of a united Germany (in her memoirs The Downing Street Years published in 1993 Mrs. Thatcher recalled her own reservations) but the extent of paranoia is revealed for the first time in confidential Kremlin documents extracts from which were published in The Times last week.


These are among some 1,000 official papers that Pavel Stroilov, a young researcher in the Gorbachev Foundation smuggled out, when he moved to Britain a few years ago.


The newspaper said they showed that at a luncheon meeting with Mr. Gorbachev in Moscow in September 1989, Mrs. Thatcher voiced her deep “concern” at the turmoil in East Germany and warned that a change in post-war borders would undermine European security.


“We do not want a united Germany. This would lead to a change to postwar borders, and we cannot allow that because such a development would undermine the stability of the whole international situation and could endanger our security,” she told Mr. Gorbachev.


Even after the fall of the wall, London and Paris continued their efforts to stop reunification of Germany. Barely weeks after the wall came down, Mr. Mitterrand’s personal adviser Jacques Attali reportedly met Vadim Zagladin, a senior Gorbachev aide, in Kiev, and repeated Mrs. Thatcher’s warning against German reunification. He said that Mr. Gorbachev’s refusal to intervene had “puzzled the French leadership” and wondered whether “the USSR has made peace with the prospect of a united Germany and will not take any steps to prevent it.”


As the reunification appeared inevitable, Mr. Attali spoke of “nightmares” among French politicians and said if the reunification went ahead he would “fly off to live on Mars.”


The Times described the documents as an “extraordinary snapshot” of the events that accompanied the collapse of the wall. Recording the concern in European capitals over German unification, Anatoli Chernayev, the Kremlin aide responsible for links with Communist parties, wrote in his diary that “everybody is whispering in our ear.”

The Anglo-French anxieties are also highlighted in a separate set of documents published by the Foreign and Commonwealth Office showing that Mr. Mitterrand privately warned Mrs. Thatcher that a united Germany might “make even more ground than had Hitler.”


The revelations have sparked a debate ahead of the 20th anniversary of the fall of the Berlin Wall with right-wing commentators rushing to justify Mrs. Thatcher’s stand. Historian Andrew Roberts, who is also a trustee of the Margaret Thatcher Archives Trust, says that her fears about a united Germany were prompted by concern that it would change the “balance of power” in Europe and, crucially, might affect Britain’s “special relationship” with America.


She feared that a “strong Germany might replace Britain as America’s closest ally in Europe, a suspicion that had been inflamed by a speech of President Bush [senior] in May 1989, in which he had referred to Germany as America’s ‘partner in leadership.’”


“Although he later added that Britain was a partner in leadership too, in Margaret Thatcher’s view, ‘the damage had been done.’ Any power likely to usurp Britain’s role as America’s ally, in effect to kill off the special relationship, was likely to raise Thatcher’s ire,” Mr. Roberts wrote in The Sunday Telegraph.


She also had concerns about the effect of a bigger and stronger Germany on the European Union. She believed that a “powerful Chancellor Kohl would have a far louder voice in the counsels of Europe, where Thatcher was fighting a long rearguard action against closer European integration, something that was to trigger the party coup against her a year later,” Mr. Roberts recalled.


Mrs. Thatcher was so paranoid that in March 1990 — seven months before the formal merger of two “Germanys” — she called a meeting of British and German historians at Chequers to discuss German national characteristics that, according to a record of the meeting drawn up by her foreign policy advisor Sir Charles Powel, included “angst, aggressiveness, assertiveness, bullying, egotism, inferiority complexes and sentimentality.”


She had to be reportedly assured that there was “no danger of a Fourth Reich” and that East Germany far from adding to Berlin’s strength would actually end up sapping its economy.


Helmut Kohl, the then German Chancellor, was to later describe her as a “very very unpleasant” opponent.









Nutrition, it seems, is nobody’s responsibility

Reducing malnutrition is not just about health, agriculture and economics


Imagine if three thousand Indians died every day from swine flu. The number is closer to ten a day but the malady still draws media attention. More than three thousand Indians a day die from malnutrition — babies and toddlers — and yet the press focus on swine flu. On September 9, 2009 Google News India listed 49,000 stories on swine flu and just 2,500 stories on malnutrition.


Economic growth in India has also failed nutrition. In most countries growth is linked to a reduction in malnutrition but in India they are ships passing in the night. Real per capita GDP has grown by nearly four per cent year on year over the past 15 years. Over the same period, the percentage of malnourished infants barely moved: from 52 to 46 per cent.


At current rates, India will not meet the Millennium Development Goal target until 2043 — not 2015 as planned. As a result a further generation is condemned to the brain damage, poorer education and early death that result from malnutrition. China has already met its 2015 target.



I have been working with more than 30 Indian authors on a new report ‘Lifting the Curse: Overcoming Persistent Undernutrition in India,’ which argues that this problem reflects a failure of governance at several levels of Indian society. The report identifies a number of problems in nutrition service delivery. Services are not provided where they are needed. Some groups of citizens are systematically excluded from services. Services are of low quality. Accountability for service provision is weak. Leadership is fragmented. Awareness of the problem is poor. Year on year nutrition data are not available to enable monitoring of progress.


Nutrition, it seems, is nobody’s responsibility. To its great credit the government is expanding funding to the Integrated Child Development Services (ICDS), the main programme tasked with malnutrition reduction among infants, but without governance reforms this could be a case of throwing good money after bad.


So what should be done? First, fund communities and local governments to undertake social audits of the ICDS services actually delivered. Let the ultimate customers rate the provision and make the results public. This will put pressure on local MPs and local providers.


Second, give the Comptroller and Auditor-General a bigger role in monitoring government action on nutrition. Their work is already cited by many, and they should be empowered to do more.


Third, simplify ICDS. There are too many interventions and too many age groups. It is complex to run, especially given the thousands of different contexts it has to adapt to. At the moment it tries to be all things to all people and runs the risk of satisfying none.


Fourth, find an effective cross-ministry mechanism to deliver food, care and health in combinations that work. Efforts to lift the curse of malnutrition must be unified.


Fifth, historically excluded groups must be involved in the design, outreach and delivery of nutrition programmes, reaching out to women from these groups in particular.


Sixth, introduce simpler but more frequent monitoring of nutrition status so that civil society and the media can hold the government and non-state actors to account for year on year slippage and reward them for progress.


Finally, develop new ways of teaching and doing research on how to improve nutrition. Reducing malnutrition is not just about health, agriculture and economics. It is also about politics, governance and power.


The persistence of extraordinary levels of child malnutrition in the midst of a whirlwind of economic growth — maintained even in the midst of the global recession — must seem like a curse. But the Government of India can act to dramatically change the situation. September’s National Nutrition Week is not enough, every day should be Nutrition Day if India is to escape the duality of being an economic powerhouse and nutritional weakling. By tackling governance of malnutrition, the Indian government can lift the curse and raise the stature of its children. It will also raise its own standing in the world.


(Lawrence Haddad is Director of the Institute of Development Studies, U.K. and editor of IDS Bulletin 40.4 ‘Lifting the Curse: Overcoming Persistent Undernutrition in India’ published by the Institute of Development Studies (IDS), in partnership with the U.K. Department for International Development (DFID).)








Commonwealth Games Federation president Mike Fennel’s letter to the organising committee of the 2010 event in New Delhi has set the cat among the pigeons. It is an open secret that almost every Games-related project has slipped well behind the completion schedule — in fact some of the facilities were due to be put to the test by now. Instead, at venue after venue, the story — as revealed by the recent report of the Comptroller and Auditor-General of India on the subject — is the same dismal one, of missed deadlines. Little wonder, therefore, that Mr Fennel wrote: "Our main concern relates to the capacity of the organising committee to deliver operationally. Preparations for the Games are significantly behind, so much so that the Commonwealth Games Federation is extremely worried about the organising committee’s ability to deliver the Games to any comparable standard to that of the last two editions of the Games in Manchester and Melbourne." Mr Fennel also sought an appointment with Prime Minister Manmohan Singh, seeking his direct intervention to speed up work and to "develop an appropriate recovery plan".


With China pulling off the stunning 2008 Beijing Olympics and thereby setting a new benchmark for such massive international events, the onus was on New Delhi to at least come up with a smooth and well-run show, even if not quite up to Beijing’s magnificent standards. In the event, even that is looking increasingly unlikely, with the CGF chief also claiming that a majority of functional areas were behind schedule and that an overhaul in the management culture and operation of the organising committee was needed to avert the Games from failing "from an operational perspective". While CG 2010 has been massively backed by both the Government of India as well as the Delhi government and a reported Rs 1,600 crores has been pumped in for the scheduled venues and the Games Village — not to mention the vast sums that have gone into various infrastructure projects all around the nation’s capital — there is a growing fear that it is not just the Games that are at stake, but the nation’s prestige too that has been put on line by Indian sports officialdom.


The Indian Olympic Committee talks bravely of bringing the Olympic Games to India in 2020, but on the evidence of what has transpired in the run-up to CG 2010, it is only so much wishful thinking. Clearly the need of the hour is far tighter monitoring by government agencies than has been the case so far. Vast sums have been spent already, but with time running out fast the Suresh Kalmadi-led IOA must be made answerable in a much more practical manner than has been the case so far. Bombastic talk is all very well, but unless deeds can match words it is the country that faces the prospect of international embarrassment.


Given India’s stature as a power of the not-too-distant future, that simply cannot be allowed to happen. If need be, a high-powered committee needs to be urgently set up to monitor on a day-by-day basis work on every aspect of the preparations — be it the stadia, practice facilities, athletes’ accommodation, roads and all other civil projects. It is a vast task, but having dragged matters to this sorry pass, there is now no alternative but to crack the whip on those responsible, be they administrators, contractors, planners or executors of Games-related projects.











Exactly one year ago, the Wall Street investment bank Lehman Brothers was allowed to go bust, in a move that is generally seen to have brought on the global financial crisis. Shock waves hit the financial markets; stock markets collapsed in waves of contagion across the world; credit seized up in most developed and many developing economies; and for a while it really did seem that global capitalism was facing direct threats to its very survival.


The collapse was not entirely unexpected. The implosion of the US housing market over the past year had already exposed the massive fragilities in the global financial system, with institutions interlocked in such opaque ways that the full extent of liability was not known even to the most experienced players. In consequence, the summer of 2008 had already witnessed the US Federal Reserve bailing out several major financial institutions, beginning with providing a dowry for the failing bank Bear Stearns in its shotgun marriage with JP Morgan, and then going on to protect and then effectively nationalise the mortgage holding agencies Freddie Mac and Fannie Mae. It was well known that many major investment banks and other financial institutions (such as the insurance giant American International Group) were all extremely vulnerable, and short-selling by those betting against such institutions only hastened the likely denouement.


After the Lehman Brothers debacle, the US government, and indeed other governments in Europe and elsewhere, swung into action on an unprecedented scale to prevent what seemed like a possible financial and economic catastrophe of global dimensions. Monetary policy was loosened to the absolute limit and fiscal stimuli were introduced to maintain spending. Most of all, there were more bailouts: huge injections of liquidity that directly and indirectly benefited certain big financial players who were seen as integral to the functioning of the system.


One year on, it can be said that that particular crisis was averted. The world economy went into recession, but did not collapse altogether. Today there is talk of recovery everywhere, even in currently recessionary Europe and certainly in the US. So was the emergency response successful? And have policymakers learned important lessons from the crisis?


Unfortunately, this does not seem to be the case. Most significantly, hardly anything seems to have been learned in terms of required regulation of finance. Despite overwhelming evidence to the contrary, there has been no moving away from the "efficient markets" hypothesis that determined the hands-off approach of governments to the financial sector. Financial institutions have been bailed out at enormous public expense, but without changes in regulation that would discourage irresponsible behaviour. Banks that were "too big to fail" have been allowed to get bigger. Flawed incentive structures continue to promote short-term profit-seeking rather than social good. So we have protected private profiteering and socialised its risks.


One of the worst consequences of this flawed manner of dealing with the crisis is that moral hazard is now more pronounced than ever. The Palgrave Dictionary of Economics defines moral hazard as "actions of economic agents in maximising their own utility to the detriment of others, in situations where they do not bear the full consequences". In financial markets, these problems are especially rife because such markets are anyway characterised by imperfect and asymmetric information among those participating in the markets.



The moral hazard associated with any financial bailout results from the fact that a bailout implicitly condones the earlier behaviour that led to the crisis of a particular institution. Typically, markets are supposed to reward "good" behaviour and punish those participants who get it wrong. And presumably those who believe in "free market principles" and in the unfettered operations of the markets should also believe in its disciplining powers.


But when the crisis hits, the shouts for bailout and immediate rescue by the state usually come loudest from precisely those who had earlier championed deregulation and freedom from all restriction for the markets. The arguments for bailout are related either to the domino effect — the possibility of the failure of a particular institution leading to a general crisis of confidence attacking the entire financial system and rendering it unviable — or to the perception that some institutions are too large and too deeply entrenched in the financial structure, such that too many innocent people, such as small depositors, pensioners and the like, would be adversely affected.


The problem is that this leads to both signals and actual incentives actually encouraging further irresponsible behaviour. Both financial markets and government policies have operated in such a way that those running the institutions that might or do collapse, typically walk off from the debris of the crisis not only without paying any price, but after substantially enriching themselves further. Because those responsible for the crisis do not have to pay for it, they have no compunctions in once again creating the same conditions.


This is why these enormous bailouts should have been accompanied by much more systematic and aggressive attempts at financial regulation, to ensure that the same patterns that led to this crisis are not repeated. Similarly, there must be regulation to prevent speculative behaviour in global commodity markets, which can otherwise still cause a repeat of the recent crazy volatility in world fuel and food prices that created so much havoc in the developing world.


This opportunity wasted by governments — reflecting the lack of basic change in the power equations governing capitalism — will prove to be expensive. We should brace ourselves for an even worse replay of the financial crisis in the foreseeable future. And the lopsided government response — benefiting those responsible for the crisis without adequate concern for the collateral damage on innocent citizens — may give public intervention a bad name, at a time when we desperately need such intervention for more democratic and sustainable economies.








As China approaches the 60th anniversary of Communist rule, the issues that have challenged its internal consolidation are once again taking centrestage. While the country has been showing remarkable economic progress and has also taken on a regional leadership role, in terms of balancing its internal problems China will remain a critical region to watch. Barely two months after the outbreak of ethnic violence in the northwestern province of Xinjiang, another spate of violence that erupted last week brings the focus on Xinjiang once again.


In July, the Xinjiang Uighur Autonomous region witnessed intense clashes between ethnic Uighurs and the Chinese Han population, in which 184 people were killed. The trigger was the murder of an Uighur national working in a factory by a Han Chinese. The clashes that broke out between the two communities brought the capital, Urumqi, to a virtual halt. What is significant is that it actually resulted in the Chinese President, Mr Hu Jintao, leaving the Group of Eight (G-8) summit and returning from Italy to address the deteriorating situation in the region.


In the wake of these clashes, the Chinese government placed Xinjiang under heavy police controls to ensure that violence didn't erupt in the region again. Despite these controls, last week's violence in the region once again points to the vulnerability of the internal situation in Xinjiang province. China was quick to place the blame for the July clashes on inflammatory speeches made by the leader of the World Uighur Congress Rebiya Kadeer. Exiled and in the United States, Ms Kadeer heads the separatist demand and leads the call for recognition of Uighur nationalism.


In a bizarre incident, last week the province witnessed a series of attacks where groups used syringes to attack their victims. Some reports even claimed that the syringes were allegedly filled with HIV-positive blood. According to reports from the state-run news agencies, nearly 476 people were treated for injuries from hypodermic needles. The victims are all from different ethnic communities. The attacks occurred at a time when the Chinese government is sponsoring an international trade fair at Urumqi, which is being touted as a possible region for foreign investment. The protesters stridently demanded the resignation of the local Communist Party leadership under Wang Lequan, who is seen as a hardliner and a close associate of President Hu Jintao.


At the heart of the Uighur unrest are both ethnic factors and economic issues. China's government has been calling for ethnic unity and economic development of Xinjiang province. However, there is a huge ethnic divide in the region that has become even more intransigent by the Chinese government's policy of encouraging the influx of Han Chinese into the region. Added to this is the deep-rooted sentiment that the region's local Uighurs have been marginalised and deprived of their share of the local resources. And that the benefits have gone to the Han Chinese who have been given priority in terms of jobs and business opportunities.


Ethnically the Uighurs belong to Turkic origin and are predominantly followers of Islam. The region lies in the northwestern parts of China and borders Mongolia and the Central Asian states. The region for much of its history has been an independent region of East Turkestan, which had Soviet support. It was incorporated into the Chinese state in 1949, at the time of the Communist revolution. At that time it had a majority Uighur population. Over the last 60 years, however, the region's demographic patterns have altered as a result of the Han influx.


The Chinese encouraged a "go west" policy, which allowed the dominant ethnic community to move to regions where there were ethnic minorities. Several phases of Han migration to the Xinjiang region took place. Critically, this challenged both the local identities and impinged upon issues of resource sharing and the availability of job opportunities.


There are critical issues on which the Uighurs have been clamouring for change. First is with regard to the issue of political representation - even though it is an autonomous region, there is very little political participation from among the Uighurs. Most of the administrative and economic bodies do not have adequate representation by the Uighurs. Second, in terms of employment, the steady influx of Han Chinese has reduced the opportunities for the local population, which is one of their main demands. Third, in terms of education, too, the use of Mandarin as the medium of instruction in government schools has led to an undermining of local traditions and the native language. This has led to some tough choices in terms of choosing between native and government schools. Job opportunities are more forthcoming for those who have been given training in Mandarin. The flip side is that decreased job opportunities in the region are forcing several ethnic Uighurs to move out of their homes in search of employment. Fourth, the region is extremely rich in natural resources. Both in oil deposits and in minerals, the region is one of the richest. Much of the region's wealth has been directed towards the growth that China is pushing for. As a result, the region itself remains impoverished. This uneven distribution of wealth between the Centre and the province will have a critical impact in the years to come.


In the aftermath of last week's incidents, the Chinese government has been quick to state that it can competently handle issues relating to social stability and national unity. One of the issues as far as the Uighur movement is concerned is that China has been able to effectively use its diplomatic skills to propagate that the Islamic Uighur community is linked to groups like the Al Qaeda in the post-September 11 scenario. This has been one the factors that has allowed for the Uighur movement to get much less attention than it actually deserves. With the growing emphasis on terror linkages with Islamic communities in the region, China has been able to divert attention from problems of internal consolidation. Unlike the case of Tibet, the Uighur problem has received less international attention because of its alleged linkages with terror groups. This too has made the Chinese policy in the region go largely unnoticed. And given the manner in which China is changing the social landscape in both Tibet and Xinjiang, there is serious concern that Xinjiang may slip into a state where the currently perceived links to terror groups may, in fact, become a reality.


Dr Shankari Sundararaman is an associate professor of Southeast Asian Studies at the School ofInternational Studies, JNU









After the defeat of Japan’s Liberal Party, which enjoyed power for 54 years, its leader accepted his responsibility and immediately resigned. During the last 10 years, the Tory Party in England has made several changes in its leadership.


In India, however, the Bharatiya Janata Party (BJP) and the Communist Party of India-Marxist (CPI-M) continue with the leadership that brought them defeat in the recent Lok Sabha elections. The BJP, at least, has the Rashtriya Swayamsevak Sangh (RSS) to take over the reins and is bound to listen and follow the directives of its chief, Mohan Bhagwat. But the CPI(M) continues with its absurd policies and defeated leaders.


Mr Bhagwat has asked the BJP to make generational changes. So Lal Krishna Advani would eventually have to give up his post of the Leader of the Opposition in the Lok Sabha. As Mr Bhagwat is not happy with the coterie that surrounds Mr Advani and BJP president Rajnath Singh, he is likely to select someone from outside this coterie to replace Mr Advani and Mr Singh.


Mr Bhagwat is not the first RSS chief to suggest a generational change. K. Sudarshan insisted on it much earlier. But now, as the BJP has lost two elections in a row, the leadership is left with no option but to abide by Mr Bhagwat’s directive. This time the BJP has also had to face an internal revolt that was essentially against Mr Advani. The defeat in the election had demoralised the party and now, with the departure of the central leadership, every state organisation would be on its own, at least for some time. Mr Advani and those in his close circle could have avoided this ignominy by making changes on their own. Because of their short-sightedness they now have to grumblingly follow the RSS’ diktats.


Calling the BJP "Blunderland", Arun Shourie asked for wholesale dismissal of its leadership and a takeover by the RSS. This was rejected by Mr Bhagwat by saying that the RSS is a cultural organisation that is not interested in fighting elections. This claim is not entirely accurate.


It is true that the RSS has always claimed to be a cultural organisation, but things changed when Bhaurao Devras succeeded Madhav Sadashiv Golwalkar as the RSS chief. He, of course, also stressed the cultural aspect of his organisation but was not totally averse to electoral politics. This became evident at the time of the 1971 Lok Sabha elections. Convinced that not Jan Sangh but Indira Gandhi’s Congress would defend the interests of Hindus, the RSS surreptitiously supported Congress candidates and that resulted in the Jan Sangh’s miserable performance.


Eventually, when the agitation against several state governments gathered momentum under the leadership of Jayaprakash Narayan, thousands of RSS volunteers joined him. And after Indira Gandhi proclaimed Emergency, they courted arrest. In those days Nanaji Deshmukh was a close confidant of JP which socialists did not approve. The elections after the Emergency saw Congress out of office at the Centre and several parties, casting aside their identities, formed the Janata Party of which Jan Sangh was a constituent.


Madhu Limaye and George Fernandes raised the question of the dual loyalty of the Jan Sangh though it was not this but Charan Singh and Raj Narayan’s revolt that brought down the Janata ministry. Indira Gandhi came back with a thumping majority and the Sangh had its second incarnation as the BJP, with RSS regaining the position of a mentor.

It was a common perception that though Atal Behari Vajpayee was respectful to RSS chiefs, it was Mr Advani who enjoyed their confidence. That was why Mr Vajpayee initially could not give a ministerial berth to Jawsant Singh due to pressure from the then RSS chief.


A columnist, who is close to both the BJP and the RSS, has said that even before the last elections, about 250 RSS pracharaks had been appointed on different levels in the BJP. Some of them are even state-level secretaries. It is also known that most members of the BJP’s national executive have Sangh background.


So the RSS cannot absolve itself of its responsibility in the electoral defeat. Can Mr Bhagwat claim that his organisation is as strong as before? Its ranks have dwindled over the years. Is this not a reflection on its leadership?


Now that the RSS has started openly micro-managing the affairs of the BJP, the logical step would be to takeover the party. But if the organisation continues with its present ideology, it would be unable to get any allies and a disastrous defeat in the next elections is certain.


The BJP is not going to gain strength under the leadership of Mr Advani. His departure, along with his cozy circle, will make no difference either. But the RSS takeover is also bound to result in a fiasco.


The belief that the RSS is very powerful is a myth. If it holds any internal elections, dissentions would immediately come out. With the takeover of the BJP, it would have to face elections for the state Legislative Assemblies as well as for the Lok Sabha. It would be a delusion to suppose that an RSS-managed BJP would remain above groupism, cronyism and corruption.


All these years the RSS has been enjoying power without responsibility. It had the luxury of speaking in general terms without spelling its agenda for economic and social change. The so-called moral authority of the RSS is also required to be tested. But the fact remains that when it joined the agitation against Emergency, people regarded Jayaprakash Narayan as a moral force and not the RSS.


It is worthwhile to note that after Independence, some Gandhians thought that they would enjoy power without responsibility, thinking that they were morally superior. But both Pandit Jawaharlal Nehru and Sardar Vallabhbhai Patel quietly sidelined them. BJP leaders could not follow this example.











Chief Justice of India Justice K.G. Balakrishnan has rightly stressed the need for confiscation of properties and assets of corrupt bureaucrats who are convicted of offences under the Prevention of Corruption Act. Addressing a seminar in New Delhi, he has said that if a public official amasses wealth at the cost of the state exchequer, the state would be justified in seizing such properties. His statement, coming close on the heels of Prime Minister Manmohan Singh’s statement on checking corruption at the top by catching the big fish, underlines the imperative need to root out corruption in the administration and improve the quality of governance. Few will disagree with the CJI’s observation that corruption is going on unchecked because of long delays in granting sanction to prosecute corrupt officials often because of extraneous considerations. As there is virtually no fear of punishment among the corrupt, it is not the “quantum” but “certainty” of punishment that will be an effective deterrent, the CJI has said.


The CJI has cited several reasons for the poor conviction rate of corrupt officials. Among these are the government’s refusal to sanction prosecution of officials, shortage of courts, a large number of witnesses creating hurdles in the court work, and lack of coordination between the CBI and government law officers. No wonder, according to a study, of 153 cases of senior officers awaiting the government’s sanction, as many as 21 cases were pending for more than three years, 26 for 2-3 years and 25 for 1-2 years. On their part, bureaucrats know how to use filibuster and loopholes to delay the cases for years and avoid punishment.


Unfortunately, the government has very rarely taken resort to Article 311 of the Constitution for sacking officers for causing serious monetary loss to the state. Significantly, Union Law Minister M. Veerappa Moily has said that he is pursuing the matter with the Prime Minister for a review of Article 311 so that corrupt civil servants can be summarily dismissed. Equally significant is his statement that the government’s prior sanction is not needed to prosecute a civil servant who is caught red-handed while accepting a bribe or found in possession of assets disproportionate to his/her known sources of income. Clearly, if corruption has to be checked, swift and decisive punishment of officials is imperative. It requires the government and the judiciary some will to throw out the rotten apples. 








For India it is no news; nor should it have been for the Americans. Many US lawmakers now acknowledge that Pakistan has been misusing aid given to it by the US. None else than General Pervez Musharraf has admitted on television that Pakistan violated the rules governing the US aid for fighting terrorism and used the funds for strengthening Pakistan’s defences against India. Last month External Affairs Minister S. M. Krishna had stated that “whatever aid has been given (to Pakistan), whatever arms have been given (under the military aid programme) are invariably directed against India.” This has been India’s experience over the decades. India has impressed upon the US government that it is the primary responsibility of Washington to ensure that the financial assistance it provides to Pakistan is spent for the purpose for which it has been sanctioned and is not used against India.


New Delhi has been worried about Pakistan’s diversion of US aid for purposes other than that for which it is intended particularly after the US Senate passed a bill tripling the annual aid package to Islamabad to $7.5 billion to be released over five years. This happened despite the fact that 90 per cent of the US aid received by Islamabad so far has been squandered by Pakistan’s armed forces for purchasing arms and armaments as a recent paper by a Harvard University research fellow, Mr Azeem Ibrahim, says. The unfettered flow of funds from the US has made the Pakistan military develop a vested interest in ensuring its domination over the government, preventing the growth of democratic institutions there and much else.


The US has procedures to monitor the flow of its funds to Pakistan, but Washington has been lax in this respect. Now that a former military ruler of Pakistan has admitted to having violated the rules governing US aid on the pretext of having “acted in the best interest of Pakistan”, Washington can offer no excuse. The US must stall all aid to Pakistan if it is to be ultimately misused for enhancing its military capability vis-à-vis India. 







It is said half the world goes to bed every night after consuming grains derived from varieties developed by or under the supervision of Dr Norman Borlaug, the great American plant scientist who died on Saturday, aged 95. Widely hailed as the father of the Green Revolution, Dr Norman Borlaug can be justifiably credited with saving millions of lives in famine-prone Mexico, India, China and Africa. The Nobel committee acknowledged Dr Borlaug’s contribution while presenting him the 1970 Nobel Peace Prize: “More than any other single person of this age, he has helped provide bread for a hungry world”.


Born in a Norwegian farming family in 1914, Norman saw great human suffering during the Depression in the 1930s. He recongnised that “hunger could cause people to behave violently”. He worked as a waiter while studying in the University of Minnesota. Living in an age when famines and starvation deaths were common, Norman left an easy job with DuPont Co to work in Mexico’s harsh climate, experimenting on wheat. By crossing Mexican and Japanese varieties, he developed a variety that was disease-resistant and produced 10 time more grains. This led to the development of a similar variety of rice in the Philippines, thus paving the way for the Green Revolution.


Much later when the world had reasonable food security, environmentalists started questioning the actual gains of the Green Revolution. Because of the use of chemicals, they say, “the consumer is being poisoned out of existence”. American experts, writes Vandana Shiva, one of the critics, “spread ecologically destructive and unsustainable practices worldwide”. Dr Borlaug dismissed them as elitists who did not have to worry about their next meal. Although the Malthusian threat of an exploding population outstripping its ability to feed itself has diminished, the threat of food insecurity still looms. In one part of the world or another food riots do take place. The world today needs more scientists as dedicated as Dr Borlaug to benefit from.
















By serving an eviction notice to the old and failed leader in the Bharatiya Janata Party, Sangh chief Mohan Bhagwat has once again confronted Mr Lal Krishan Advani with an old dilemma of the dual membership. Mr Advani had faced the same issue 20 years and a month ago when he was a Cabinet minister in the Morarji Desai government. Socialist leader Madhu Limaye had hyped up the issue of dual membership of the erstwhile Bharatiya Jana Sangh that had merged with the Janata Party in January 1977. They had continued their allegiance to the Rashtriya Swayamsevak Sangh. Prime Minister Morarji Desai preferred to allow his government to break down rather than confront Mr Atal Bihari Vajpayee, Mr Advani and other erstwhile BJS members to decide their preference between the Janata Party and the RSS.


Desai could not bring himself to concede the demands of the Charan Singh group that erstwhile Jan Sangh members should be asked to end their allegiance to the RSS if they wanted to be a part of the Janata Party. His argument was that no person could be allowed to have dual loyalties as no one can have two mothers. Desai believed that the demand was only a cover-up for power hunger and more demands would follow if he buckled down under pressure. The rigid attitude of Desai ended up in the collapse of his government. But the Jan Sangh members did not pay back in gratitude as they set up a separate house in the Bharatiya Janata Party in April 1980.


The new party struggled for almost a decade to find an ideology that would give it an effective identity to enable it to expand its social and geographical reach beyond the Hindi belt and also beyond its traditional vote banks. With its perceptible and palpable rise for the first time in 1989, others who did not pass through the Sangh theological school began to swell its ranks. Finally, the BJP was able to lead the ruling alliance but only after it had put on the back-burner the controversial issues that had become the core of its identity. Others were not willing to subscribe to those issues if the BJP wanted support to climb into the seat of power. The BJP had no alternative but to submit. Even the Sangh had to endorse it as it also could realise that the BJP could not lead the alliance without putting the issue of identity on the back-burner.


The Sangh mandarins tried to dictate to the then Prime Minister, Mr Vajpayee, on the composition of his Cabinet, on the selection of not only men and women but also their portfolios. Mr Vajpayee ignored their directions and had a team of his own choice. In most policy matters also, he sidestepped on the suggestions coming from Nagpur, for he knew that he had to carry along other parties to survive in the office and they would not agree to accept directed policies.


However, he was helpless after his decision to sack Gujarat Chief Minister Narendra Modi for the communal carnage in Gujarat was thwarted by manipulations. The Sangh may not have designed, devised or even desired what happened in Gujarat but it certainly did not displease it. Hence it could not allow the dismissal of their hero from office. Even after knowing who had manipulated the game to thwart his decision, he had to tolerate the arrangements in his team.


Mr Vajpayee could get away with his defiance of the Sangh only because no one else had a wider acceptability as the head of the government in the ranks of the BJP. The Nagpur mandarins had to tolerate his defiance and take a solace in his lip service to the Sangh on and off such as his declaration in the US that he was still a volunteer at heart. It did raise a storm in the country but it passed of soon.


Mr Advani could not withstand the pressure built on him after he made a first attempt to break away from the ideological straightjacket of the Sangh to redo his image from a hawkish one into an acceptable one by praising the credentials of Mohammed Ali Jinnah during his visit to Pakistan in July 2005. Mr Advani was fully aware of what views the Sangh held on the founder of Pakistan. Yet he dared to speak out his mind. It could not have been without calculations and overpowering intent.


He may have failed to achieve his life’s objective due the wrong selection of issues and personal vilification of the Prime Minister. But that did not mean he was a failure as a leader. Ultimately, he was mainly responsible to build the party from scratch to which it was reduced by the 1984 election results. Now he was served an eviction notice as if he was merely a tenant and his office of the Leader of Opposition was merely a rented accommodation with ownership rights vested in the Sangh chief.


The Sangh chief has camouflaged his notice with nice phrases that he had merely made a suggestion. The BJP leaders would take the final decision in consultation with all colleagues.


Mr Advani has been told that he has to go but he could decide in consultation with others in the party who would be his successor. He must know the consequence that would follow in obeying the dictat. It is obvious that his followers, young or old, also would not have freedom of choice for any different policy frameworks but to follow the traditional RSS concepts. The Sangh chief has assumed that the Sangh ideology is correct and valid even in the changing world of India. Only men have failed in selling it to voters. Mr Advani has to decide which of the two loyalties are more important to him now that no one is around to bail him out of his RSS-knitted straightjacket. He has to decide whether he lacked the ability in selling or he was assigned the sale of bad goods. If he is confident of his ability, then the only options are either to go down fighting or lay down arms without even a protest.


If the BJP has to survive in the new world, it would have to now confront itself with the issue whether it should continue its dual membership structure or should declare its independence. It cannot become an independent political apparatus unless it refuses to accept dictations from outsiders and develop a democratic capacity to take decisions within. Or else it should prepare itself to become an extinct political specie in the months to come. It becomes imperative as there are large numbers in the party who have not passed through the rigours of the Sangh’s concept of Rashtra. They would have no option but to seek new pastures sooner than later.


Mr Advani has sought change to give his final answer. He is now visiting party leaders for an ostensible purpose of searching heads for replacement. Or, may be, he is really assessing his chances of support in case he has to take on the fight. No one can grudge him the precaution after the bad experience when even the faithful ran for cover when it came to confront the Sangh mandarins. So, the second half of 2009 becomes a historic period that would show how Mr Advani will chose his place in history — whether he would be a martyr who would be remembered for a long time or a bad general who could not fight. It is the final confrontation of his life.








METAMORPHOSIS! What does it mean? How does it occur? I could never comprehend its intrinsic meaning till I realised that I was myself undergoing the process, though in a subtle manner, ignited by the simultaneous advent of two little babies, a son and a daughter, in my family.


As a toddler, my son Pitamber would often go to my camp office in my absence with the baby sitter and ‘usurp’ my chair. He would invariably pick up the phone and start issuing ‘instructions’ to ‘unseen’ persons in a dialect nobody could decipher. He was perhaps, I felt, trying to acquire my style of functioning. He would generally copy all my gestures and pose to be ‘papa’ in action.


Once I caught him red handed while he was ‘commanding’ the district in my absence and stealthily videographed his ‘criminal trespass’ and ‘impersonation’ on the mobile phone of the district police chief. But that was not with the purpose to prosecute him for the ‘criminal acts’ he was committing in full public view. May be the little ‘artist’ was rehearsing to step into my shoes and perform the role of a future civil servant.


The tears spontaneously started rolling down since I had at last discovered my first ‘disciple’ who had ostensibly accepted me as his ‘role model’.


As he grew my height, he would often pick up my personal belongings at will without any notice. But it gave me a feeling of pride that the ‘thief’ was growing in size to match my stature.


Once I was caught unaware. It so happened that I got a message from the Chief Minister’s office about an emergency meeting within the next half an hour. I started getting ready. But my ‘solitary’ leather shoes were nowhere to be found. I got panicky. I fired my domestic help for not keeping my things in a proper manner. He explained with folded hands that ‘chhota sahib’ had gone for a party with his friends wearing my shoes. “What should I do now?” I asked my wife, Shailja.


She went into trance for a while and then came out with a novel idea. “You should try Pitamber’s shoes instead”, she guided. How could I fit into his shoes? But since I was running out of options, I tried somehow, though hesitatingly. My feet were ushered in. And lo and behold, there I was without much effort on my part. I then realised that my son’s shoes were the perfect size for me. What a pleasant surprise indeed! I had finally stepped into my son’s shoes!


As if that was not enough, my daughter Archna hurriedly brought my son’s branded shirt to ‘botox’ my shabby looks. I obeyed and ran out for the meeting.


It was here when I stepped into my son’s shoes that I experienced a total metamorphosis in me. I felt more energetic like my son. I realised that my son was no more a kid but a grownup boy who needed to be treated more like a friend. Like William Wordsworth in his ‘Ode to Immortality’ that a ‘child is the father of man, Might Prophet, Seer Blest’, the experience of getting into my son’s shoes actually opened many new vistas in my life!








Norman Borlaug, the father of the "Green Revolution" who died on Saturday in Texas aged 95, is widely credited with saving more than a billion lives by breeding wheat, rice and other crops that brought agricultural self-sufficiency to developing countries around the world.


Borlaug was one of only five people in history to score the trifecta of winning the Nobel Peace Prize, the Presidential Medal of Freedom and the Congressional Gold Medal – placing him in the company of the Rev. Martin Luther King Jr., Mother Teresa, Nelson Mandela and Elie Wiesel. He was also named by Time magazine in 1999 as one of the 100 most influential minds of the 20th century.


That influence showed itself in earnest while Borlaug was working in Mexico in the 1940s where he created a system of plant breeding and crop management that became the basis for the Green Revolution. The system was a huge success and was exported to countries around the world.


In 1960, the world produced 692 million tons of grain for 2.2 billion people. By 1992, largely as a result of Borlaug's pioneering techniques, it was producing 1.9 billion tons for 5.6 billion people – using only 1 percent more land.


Ever since 19th century British economist Thomas Malthus first predicted that the world's population would eventually outstrip its capacity for growing food, prophets of doom had envisioned catastrophe.


Such a disaster was actually quite close beginning in the late 1930s. Between 1939 and 1942, Mexico's wheat harvest had been halved by stem rust, a fungus whose airborne spores infect stems and leaves, causing the grain to shrivel. India, Pakistan, China and a host of other countries were also facing the prospect of widespread starvation.


Alarmed by how food shortages might impact the war effort, the Rockefeller Foundation – largely at the instigation of Secretary of Agriculture Henry Wallace – established the Cooperative Wheat Research and Production Program in Mexico. It later became known as the International Maize and Wheat Improvement Center or, by its Spanish acronym, CIMMYT. Borlaug signed on in 1944 after finishing his wartime obligations as a chemist at E.I. du Pont de Nemours.


Borlaug collected wheat strains from around the world and began cross-breeding them, a process he later recalled as "mind-warpingly tedious." To speed things up, he planted two crops per year, a summer crop in the low-quality, high-altitude soils near Mexico City and a winter crop hundreds of miles to the north in the low-lying Yaqui Valley.


This "shuttle breeding" was derided by experts at the time, who insisted that such experiments must be conducted at the same locations and times employed by local farmers to be useful.


Within five years, however, Borlaug had produced a strain that was resistant to rust, more productive than existing strains, and that grew in both climates when given adequate fertilizer and water.


But there was still one problem. Evolution had favored wheat strains with long, slender stalks that allowed the wheat to rise above the shade of nearby weeds. With the added weight of the extra grain, however, the stalks tended to collapse when irrigated or rained on, reducing yields.


After thousands of fruitless attempts to produce wheat with shorter stalks, Borlaug encountered a Japanese dwarf variety. After thousands more attempts, by 1954 he had succeeded in producing a short-stalked variety that was rust resistant and high yielding. And because the plant did not have to invest energy in producing long stalks, its yield was even higher than before.


Using the new strains, Mexico, which had imported 60 percent of its wheat in the early 1940s, became self-sufficient by 1956.


In 1954, a rust epidemic hit the American Midwest, destroying three-quarters of the durum wheat crop that was used for making pasta and accelerating use of the new strains in the United States. There has not been a similar outbreak since.


Using Borlaug's techniques, scientists at CIMMYT and elsewhere soon developed similar high-yield strains of rice and corn.


In the early 1960s, India and Pakistan were confronting famine and CIMMYT sent Borlaug to intervene. He planted demonstration plots of the new dwarf variety, but was unable to convince the state-owned seed companies to adopt them.


By 1965, however, famine in the region was so bad that the governments acquiesced. Borlaug organized a shipment of 35 truckloads of dwarf wheat seeds. After many delays, the seeds were finally shipped, but by then India and Pakistan had gone to war.


It quickly became apparent that the seeds were germinating at less than half the normal rate – it later was learned that the seeds had been damaged by fumigation before shipment – and he ordered workers to double the seeding rate.


Despite the problems, the new crop was 98 percent bigger than the previous year's and the Asian subcontinent was placed on a new path. India ordered 18,000 tons of seed from Mexico and the harvest was so big that there was a shortage of labor to harvest it, too few carts to haul it to the threshing floor, and an insufficiency of bags, trucks, rail cars and storage facilities.


By 1968, Pakistan was self-sufficient in food production. India joined it in 1974.


Because of his efforts, Borlaug was awarded the 1970 Nobel Peace Prize.


Eventually, however, a backlash developed. In the 1980s, environmental groups began pressuring the foundations and the World Bank to stop funding shipments of fertilizer to developing countries, particularly in Africa. Critics charged the inorganic fertilizers caused massive pollution and argued in favor of "sustainable" agriculture using "natural" fertilizers like cow manure.


Borlaug was indignant. Using manure would require a massive expansion of the lands required for grazing the cattle and consume much of the extra grain that would be produced. At best, he said, such efforts could support no more than 4 billion people worldwide, well under the nearly 7 billion now inhabiting the planet.


"Some of the environmental lobbyists of the Western nations are the salt of the Earth, but many of them are elitists," he told the Atlantic Monthly magazine. "They've never experienced the physical sensation of hunger. They do their lobbying from comfortable office suites in Washington or Brussels. If they lived just one month amid the misery of the developing world, as I have for 50 years, they'd be crying out for tractors and fertilizer and irrigation canals, and be outraged that fashionable elitists back home were trying to deny them these things."


Borlaug formally retired from CIMMYT in 1979, becoming a professor at Texas A&M University. But in 1984, he got a call from Japanese industrialist Ryoichi Sasakawa, who offered Borlaug funding for five years of work.


Borlaug later said that, "I assumed we'd do a few years of research first, but after I saw the terrible circumstances there, I said, `Let's just start growing.' " He soon had projects running in several countries, including Benin, Ethiopia, Ghana, Nigeria, Sudan and Tanzania.


Norman Ernest Borlaug was born March 25, 1914, on a farm near Cresco, Iowa, in a portion of the state called "little Norway" because so many of its residents were immigrants from that country. His education began in a one-room schoolhouse.


Along with his wife, the former Margaret G. Gibson, Borlaug is survived by daughter Jeanie Borlaug Laube; son William Gibson Borlaug; five grandchildren and six great-grandchildren.


By arrangement with LA Times-Washington Post








Good and fast roads are the lifeline of an economy and provide economic as well as emotional stimuli to it. The US economy, which plunged into a great depression in the early twenties, got revived due to the huge highway development programme initiated by the then President Franklin Roosevelt.


The overall early development of Punjab is also ascribable to the strong rural and urban road network which got developed in the late sixties and early seventies in the state.


But today it is overstressed due to increased volume of traffic and vehicle density. With this kind of network the state is not a favoured destination for investment as compared to some other states in India. With the announcement of construction of expressways in the state by young Deputy CM Sukhbir Singh Badal last year, it was like a dream coming true for Punjab, where such infrastructure is much needed for development.


But the recent reports about scrapping the Rs 5000 cr. 104 km Mohali-Phagwara Expressway, which was to reduce the journey between the two destinations to less than an hour from the present two and a half plus, has come as a bolt from the blue for those who really feel concerned about the overall development of the state.


The opposition from the land owners and some others, whose properties fall in the alignment of the expressway, is obviously behind the scrapping of the project. Some of them are asking exorbitant prices, while others are making political issues out of it.


The landowners and other stakeholders were reportedly to get handsome compensation, but it is intriguing why people fail to spot an opportunity in a crisis and encash it. By getting Rs. 30 lakh to 50 an acre, these landowners can buy huge chunks of fertile land in states like UP, MP and Gujarat, where it is still available at around Rs. 2 to 3 lakh an acre with plenty of underground water and good electricity supply.


These very expressways will ensure that industrious farmers of Punjab reach these destinations within 12 to 15 hours and control farming from here. Furthermore, a dormant dream which every Punjabi nurtures to own a vast chunk of land would also get realised as their land-holdings would get multiplied 10 to 15 times!


Punjab today is in a dire need of fast-mode connectivity in the wake of new challenges of growing traffic on the one hand and much-needed industrial development on the other.


The agriculture sector also needs a good road network as the proposed crop diversification calls for a faster transportation system so as to enable the perishable farm produce to reach distant markets and fetch handsome returns.


Being land-locked, the state is accessible by roads and railways for bulky transportation and these expressways can only ensure a speedy movement of agricultural and industrial goods. They are also the best attractions for investors as they look much to these infrastructural facilities than the sops and tax breaks.


In today’s fast world, expressways provide an exhilarating experience. One should on the Mumbai-Pune Expressway or the Ahmedabad-Anand-Vadodra Expressway, where an average speed of a vehicle is more than 120 km an hour.


Going by the needs of the state and the merits of the project, let the state policy-makers shun all doubts and review the decision to build these marvels for the coming generations. This will be a real legacy worth leaving. Speed in today’s world is all important.







The controversy over the construction of memorials by the UP government has brought out divergent views of apex court judges on the subject.


When a petition came up before the Chief Justice’s court questioning the propriety of the Mayawati government spending huge amounts on memorials for Dalit leaders, the Bench felt that the judiciary had no role in matters that had been approved by the legislature and the Cabinet.


The CJI clarified that the judiciary could interfere only if there were charges of irregularities and corruption. However, while hearing a similar plea later, another Bench observed that courts had the power to scrutinise such huge expenditure involving tax money, particularly by a state whose GDP growth was abysmally low at 2 per cent.


While the Bench of Justice BN Agarwal directed the UP government to stall work at the Lucknow memorials, the Forest Bench headed by the CJI refused to grant a stay on a similar memorial at Noida. Justice Agarwal, the seniormost judge, is retiring on October 15. The CJI’s tenure ends on May 12 next year.



Who says India-China ties are under strain due to the recent Chinese incursions in the Indian territory? Even the new Indian Ambassador to China has spoken highly of booming trade, regular contacts between the leaders of the two countries as well as rising interaction between the two peoples and even the armed forces.


Recently, Jaishankar was in New Delhi for the high-profile meeting of the Indian envoys convened by the External Affairs Ministry.


He was still in the midst of his engagements in the Capital when a call came from Beijing to tell him that the Chinese authorities would like him to present his credentials to Chinese President Hu Jintao along with new US envoy to China Jon Meade Huntsman.


With permission from his bosses, Jaishankar cut short his stay in New Delhi and air-dashed to Beijing to be there well in time to present his credentials.


The buzz in the corridors of power is that China would not do anything silly to ruffle India’s feathers in view of its commercial interests, though New Delhi can’t afford to lower its guard.



Ever since former Vice Pesident Bhairon Singh Shekhawat expressed his desire last year to return to active politics and was summarily snubbed by BJP president Rajnath Singh, much distancing has taken place between Shekhawat and his former party. Anyway he has not renewed his membership of the BJP since he assumed the office of Vice President of India.


This distancing and disenchantment with the BJP or its parent body, the RSS, is on display in Shekhawat’s Aurangzeb Road visitors’ room.


The room is adorned by the images and photos of Hindu gods and goddesses; his own photographs. Apart from these the only other photo, a group one at that hangs on a side wall is Gandhiji leading the Dandi March.


Walking alongside are Nehru, Rafi Ahmed Kidwai, Sardar Patel and Azad. Obviously, he does not consider any BJP or Sangh leader worthy enough to be shown off to his visitors. There is no reason for him to do so, either.n


Contributed by: R Sedhuraman, Ashok Tuteja and Faraz Ahmad








Austerity, like charity, should begin at home. In all fairness to her, Congress chief Sonia Gandhi had been trying to drive this ‘home’ in to members of her party for quite a while. From the moment she became president of the Congress in 1998, ‘observe austerity’ has been the chanted mantra. Her exhortations to Congressmen to desist from “conspicuous consumption, ostentatious displays of wealth and outright wastage” had been in 2004 supplemented by a code of ethics to be observed by them. This year itself she announced austerity measures in the wake of drought conditions, asking ministers, MPs and MLAs to donate 20 per cent of their salaries. Thus there is nothing new in the recent focus on austerity in the wake of the Krishna-Tharoor episode. It may be recalled that the External Affairs Ministry duo had been staying in five star hotels as they awaited official accommodation, and were unceremoniously asked to make their exeunt from them in favour of more ‘austere’ quarters. Insiders suspect that internal rivalry rather than an authentic sense of ethical propriety had been instrumental in bringing this ‘shocking’ infringement to the notice of Lady High Everything. However, it has helped in improving the party image, projecting as it has the illusion of a political entity deeply committed to an austere life-style befitting a nation so filled with poverty.

Having discovered that the episode hit media headlines, the party has been trying to make the most of it, with great ‘feats’ of austerity being duly reported almost every day. For instance, the Haryana Chief Minister was asked to hold his son’s engagement ceremony in a MP’s residence rather than the originally envisaged five-star hotel. Even more risible has been the action of Pranab Mukherjee in flying on a budget airline. The very fact that this made the front-page in the print media shows that in India it is assumed that politicians, especially those from the ruling party, are more equal among equals. Latest indications are that the Centre, bitten by the austerity bug, has aborted a plan to raise the salaries and perks of MPs, which would have been a contradiction in the present circumstances. But such beating of the austerity drum is unlikely to fool the public in the long run, since it is all too aware of the nature of our political culture, particularly that of the Congress. It is also well known that hundreds of crore of rupees are expended every year by the Government in sustaining our ministers, MPs and MLAs, a phenomenon not conducive to furthering the austerity cult. Until the Government decides to stop being a spendthrift with public money and drastically reduce wasteful expenditure associated with these political entities, all talk of austerity would remain what it is, just a great amount of hot air.







It is heartening to note that the rice production of Assam in 2008-09 has surpassed the hitherto 50-year highest record of 2000-01. This is particularly significant at a time when the country is facing a serious mismatch between demand and supply of all farm commodities on the one hand and Assam being overwhelmingly a rice-eating State on the other. Thus, in the fiscal 2008-09, the total production of rice in the State is officially estimated at 40.7 lakh metric tonnes as against the requirement of 38.9 lakh MT, resulting in a surplus production of 1.8 lakh tonnes. What is of added significance, again, is that the amount of rice produced in 2008-09 was grown from an area of 24.8 lakh hectares of paddy field against the earlier highest record (in 2000-01) of 38.9 lakh MT being raised from cultivation of 26.5 lakh hectares. It means that the output of rice per hectare in 2008-09 has been larger than in the bumper harvest record-year of 2000-01. The increase in production has been possible due, among other things, to a change in crop composition as between rice varieties. Thus, a shift in cultivation is being noticed in favour of winter rice from autumn rice variety since its productivity per hectare is not much encouraging. The State government has, therefore, rightly laid more emphasis on using the autumn rice land for growing summer rice and vegetables as they are found to be more productive in terms of economic benefit. On the basis of inter-year comparison, it is found that while the normal rate of productivity per hectare of land is 896 kg for autumn rice, it is 1482 kg for winter rice and 1995 kg for summer rice in recent years. The success should mainly be attributed to the National Food Security Mission (NFSM).

It is, however, uncomfortable to note that the Mission’s efforts are confined to only 13 districts of the State and that, too, on rice alone. What is urgently necessary is that the remaining 14 districts should soon be brought under the same measure. The drought situation of the current months has, of course, affected the Sali-rice cultivation. Because of the lack of normalcy in weather conditions, the high-yielding varieties cannot be transplanted and have to be substituted by only local varieties. As a result, the current fiscal will not be able to witness the achievement of targeted rice production. Another problem is that the State’s crop area due not only to drought but also due to flood and erosion has gone down in the current decade by around 1.25 lakh hectares. Since the State is basically agricultural, its growth squarely depends on development of agro-sector. Therefore, anti-erosion and flood control measures together with irrigational facilities have no substitute in the State’s economy. The number of water bodies in rural Assam is very large though it is beyond poor farmers to invest on irrigating water from their nearby water bodies. Hence, a part of the huge infructuous expenditure directed to mostly useless power-driven pump sets and deep tube wells could be profitably diverted to small scale irrigation from canalised water bodies to ensure growth in agricultural sector of the State.








Like many other well-worn beliefs, the notion of hard-earned money is a total anachronism in our State. It is as out of date as bell-bottomed trousers. However, there is a difference not to be overlooked. The bell-bottomed trousers may stage a comeback one of these days as many sartorial accessories have a way of doing (like turn-ups at the bottom of trousers). But the wholesome principle of hard-earned money is dead as a Dodo in Assam. It does not have the remotest chance of ever staging a comeback. In the same way, I am afraid we have bid a final goodbye to the associated idea of earning anything ‘by the sweat of our brow’. I have not seen any proud son of this State perspire at work for a long time. For most dyed-in-the-wool Assamese, sweating at one’s work is clearly infra dig. It is the kind of thing one leaves to the Bangladeshi. I have seen quite a few Assanese youths underestimating the potent Khasi kwai (the betel leaf and areca nut combination with lime) and go red in the face, sweat profusely and feel giddy. I have seen our youths perspire heavily during the unusually hot summer we are going through this year. I have also seen them sweat like horses after a tough game of tennis or badminton. But I have never seen the urban Assamese in a government office sweat during work. And yet all government officers who are worth anything at all (magistrates, judges, college principals et al) have a towel draped over the back of their chairs – something I have not seen anywhere else in the world nor even in other States of the country.

A recent visit to the Dispur market was most edifying. It is a market where the prices are a good 10 to 15 per cent steeper than what people pay in the other markets of town. There is no question about the quality of the stuff you get there – especially fruit and fish. It didn’t take me long to discover why the prices were higher and the stuff so good. Very few people ask about prices there. Someone likes the look of a huge rou fish and he just says “Give me two kilos of that.” When the fishmonger has finished dressing and chopping the fish and put the cut pieces in a double plastic bag, the buyer removes his handkerchief from his nose just long enough for just one word “Kiman? (How much?)” and pays up the Rs 500 demanded without a murmur like a thoroughbred gentlemen. On his way out, the same customer picks up five plump and shiny red pomegranates with the same nonchalance. He doesn’t bargain; he doesn’t haggle. He leaves all that to the proverbial fishwife who is probably snatching her well-earned forty winks at home.

The conduct of this customer had me thinking. We were going through times when the humble potato was selling for twenty rupees a kilo and the more snooty carrot for sixty rupees. And here is a customer who doesn’t even ask about prices. He only asks what he has to pay at the end of the transaction. The whole thing borders on the obscene. And then comes the revelation in a flash. This Johnnie could afford to shop like a mafioso or a film star (there are no princes in India these days; there are only feudal lords) at a time when most of us would be haggling like mad or denying ourselves what we would have bought two weeks ago because prices had gone through the roof. This fellow could do what he was doing because he was not paying for his shopping with his hard-earned money. He was paying for it all with his soft-earned or rather ‘soft-acquired’ bribes. In other words, someone else was paying for it. He was merely making the most of his official position to receive daily financial benedictions that others not in government jobs cannot flaunt quite so unabashedly. Newspaper reports inform us that corrupt practices have become so much the norm in some government offices that officers who even talk about the corruption in their departments are pulled up by their superiors. But perhaps I digress.

The purpose of this essay is to draw the attention of my readers to the fact that we have managed to develop the skill of ‘soft-earned’ acquisitions into a fine art in virtually everything – not just money. The long and short of this endeavour is getting what we want with the least effort – something for nothing, if possible. It is the art of earning all kinds of dividends without any investments. Take, for instance, the difficult business of getting jobs. Those in the State who have managed to get jobs in government because they have the right connections and godfathers, or those who have bought their jobs or the miniscule number that has got in through sheer merit – a very rare happening these days – seem convinced that there is no effort to be put in to distinguish themselves in their jobs. They seem to think that the right attire, the right contacts and a bright shine on their shoes alone will see them to the end of their careers. Well, the crux of the matter is that they are so right these days. There is no need for the investment of reading (except the daily newspaper) or learning to keep abreast of what is needed for their jobs. There is even a reluctance to read files carefully and comprehend them. I have always regarded this lack of communication as the prime reason for much of the conflicts that arise in administration. But the principle of pursing the soft-earned job (like soft-earned money) is very clear here.

What takes the cake perhaps is soft-earned awards. A few years ago, a writer I know casually was angling for his second (or was it his third) national literary award. Literary awards these days are not to be sneezed at. Most of them have doubled in financial terms in the last few years, and some of them even exceed half-a-million rupees. However, I had always believed that these awards were given because they were deserved. This writer told me how much he had to lobby for his yet-to-be-received award. I was aghast. “But how can you lobby for an award for yourself without actually canvassing for it?” I asked him. He told me that I was rather naïve for the present times. “These days nothing happens unless you buttonhole a majority of the committee members and push your case,” he insisted. I was left speechless. I knew quite a few writers from Assam, West Bengal and Karnataka who had been honoured with various national literary awards. I knew that most them could not even dream of ‘putting in a word’ for themselves. The very idea was too repugnant for words. But a couple of months later this gentleman bowled me over. He actually got the award he was lobbying for. Obviously, some enterprising souls in our society had truly mastered the art of securing even soft-earned literary awards. Who but the suave and the soft-spoken souls of Assam could have achieved this? However, this achievement is not without a touch of irony. He must have really sweated beneath his collar as he went about lobbying for himself.








For any urban planning and execution process to succeed, we need a strong Municipal body to function so that the hopes and aspirations of the citizens are reflected. At the same time such hopes and aspirations should not be limited to some individual level but must be focussed on the collective interest of the people. Therefore, both quality and quantity become important for a civic body to function successtully. Guwahati Municipal Corporation (GMC) was formed in 1974 with 34 wards for a city population of above 1.5 lakh. Subsequently the jurisdiction of the civic administration body has been expanded along with population increase. Naturally the number of wards increased in the course of time and presently we had 60 wards to carry out the function. Interestingly the projected population of Guwahati for 2010 has been stated to be about 12.44 lakh as per government estimate. Yet the same government has shrunk down the number of wards to 31 by dint of an enactment by the executive without any protest by the opposition to the Assembly. The details of the draft on ward delimitation has been made public on August 28, 2009 and the dateline for filing objection by citizens has been fixed on September 10, 2009, merely 10 days’ time, which is an uphill task even for a serious and conscientious citizen to review the entire draft in order to give a holistic view. Worse of all the State government is intent on getting a right and democratic opinion on delimitation of wards of GMC, a public hearing, should have been taken on it prior to its enactment. Therefore, we have reason to believe that the Government of Assam in cahoots with other politicians of various hues chalked out a plan to foist something on the people disregarding the sensible democratic opinions of the citizens. Yet this is the quality of parliamentary democracy we have been forced to accept for years together. Naturally it seems that the Metropolitan Deputy Commissioner’s public notice for filing of objections against the delimitation has become only a whitewash without any opportunity for the citizens to project their views against it.

Our Constitution has envisaged a self-governance not only in Panchayat level in rural India but in case of municipal administration also in urban India. Accordingly constitutional amendments have been made in the nineties, which necessitate a decentralisation of power for planning and execution to the grassroots level. Naturally if a ward is considered as a sub unit of such planning, the population of the ward needs to be optimal so that the people’s representative of the ward could have close interaction with the citizens to understand their need and inadequacy of civic services they have been facing. Fortunately our government at last had the wisdom to create Area Sabbpin GMC in conformity with the amended clause of the Constitution by recognising the ward committee as the basic sub unit for civic planning. However, such Area Sabha members would not have any role in decision making body like GMC. Their role would be limited to mere information gatherer between people at the grassroots level and the Councillor. They might have all the sincerity to project people’s view before the Councillor who may not view the same in the Apex body by honouring the sentiment of his electors to the utter dismay of the Area Sabha members. We can draw a simile of such an apprehension with a practical happening in case of the committee constituted to take public hearing on draft Master Plan 2025 for Guwahati where one public member was chosen to man the body. People aired their objections against the draft Master Plan because it was anti-people and pro-rich on many counts. Ultimately, the approved Master Plan with all the evils being kept intact in the Master Plan was published. Now the public representative of the committee has little alternative but to say publicly that he accepted the people’s view and forwarded the same to the government, but the government did not listen to him. If we think negatively, may be to save himself from public wrath, he has given such a statement before the media.

Such a game may be played with people keeping the Area Sabha member on one side and the Councillor on the other side. The conflicting political interest of the Area Sabha member and the Councillor too could be counterproductive and anti-people at times. Even if the terms like equitable development and all inclusive growth have become favourites of our ruling clique, now a days we have hardly perceived the same even in an existing ward let alone in Guwahati as a whole. In a pluralistic and class divided society clash of interest is very common. Naturally the development priority too would differ from person to person depending on his economic status. Yet there could always be some common civic problem of a ward which deserves to be taken up for the benefit of the people as a whole. If the existing state of condition of the wards of the Corporation is taken as a matter of study we find that some are better off, some so so and some are the worst. Therefore, it would have been prudent to include the relatively backward area into an exclusive ward to uplift its civic condition to a level of some relatively developed ward in conformity with the tenets of equitable development.

Needless to say that the haphazardly grown city without any Master Plan has already become a chaotic one without any semblance of proper civic administration. In order to manage the problems of such a city, fragmentation of its area into small sub-planning units with democratic right of the elected Councillor to vouch for the cause of the citizens at the GMC body is a bare necessity. Modern management too says in support of such micro analysis of a problem in order to streamline a sick and giant company. Probably the approved Master Plan too despite all its angularities has spoken on creation of 60 sub-planning units one each per ward in tune with what modern management science . Yet, our politicians belonging to the ruling and opposition parties (having a penchant for all types of contradictory actions) have shrunk the wards to 31 from the existing 60, despite a clear indication given by the Master Plan. It is an irony to bear with such governance in Assam!

The decision to restructure the GMC by limiting the number of wards in the body would have a serious ramification in the civic administration. Firstly it goes against the basic principle of decentralisation of power because a Councillor of a ward with 20,000 populations could better devote his resources to the citizens’ problems rather than a Councillor of a ward comprising 58,000 people. Normally fund for ward development too is equally allotted for all the wards. The per capita share of such developmental fund too could be equitably apportioned if the wards are smaller and population is also more or less same. Such flows have been indicated in the enacted delimitation policy. Therefore, the judiciary should intervene in such injudicious decision of the executive so that a suo motto case could be taken up by the judiciary on its own on the pertinent issue of public interest. 







For Haryana CM B S Hooda, the number 45 is turning out to be a lucky one as he leads the Congress’ quest to cross the half-way mark in the 90-member state assembly for a second time. It was a tussle over 45 that ensured that none of the opposition parties — INLD, HJP, BJP and BSP — could strike an alliance.

First, BJP-INLD talks hit rough weather when the saffron party told O P Chautala they should contest 45 seats each. Seeing the BJP-INLD pact unravelling, HJP leader Kuldeep Bishnoi jumped out of the BSP tent to signal his party was ready to mingle with the BJP.

The latter quickly reached out to Bishnoi, but with a condition that he should offer them 45 seats. Mr Bishnoi said he could offer a maximum of 40, provided he’s projected as the CM candidate. The BJP, unsure about Bishnoi’s public acceptability, insisted on a 45:45 formula with a condition that in the event of the alliance getting a majority, the largest partner should head the government.

As “Catch-45” has resulted in a four-way split in the Opposition, Hooda is now using the breathing space to deal with his detractors within the state Congress.


AICC managers are past masters in buying time to let any seemingly hot issue slip into political cold-storage. So, as the mourning period for YSR came to an end, with the Jagan Mohan camp continuing to lobby in Delhi, seasoned Congress fire-fighters have come up with a proposal the ‘AP son brigade’ is finding difficult to reject.

The high command wants the Hyderabad leadership issue be postponed till the assembly elections in Maharashtra, Haryana and Arunachal are over.

To make this extended one month waiting period an exercise in strategic thinking, the AICC has also thrown hints to YSR’s son that he could plan a formal entry into state politics — as a stepping stone for bigger things in the future — by contesting the by-election from the assembly seat that has fallen vacant due to his father’s death.


As the Supreme Court is set to hear Kerala CPM boss Pinarayi Vijayan’s plea for escaping CBI’s heat in the Lavalin scam, some intriguing twists are on within the state party leadership. With not many ready to hazard a guess on which way Pinarayi’s fate will tilt, whispers abound about some ambitious Pinarayi campers positioning themselves on the fence.

The focus is on two shrewd players — finance minister Thomas Isaac and education minister M A Baby — who are allegedly trying to distance themselves from Pinarayi. Coinciding with this are the mysterious twists in the police probe into the high-profile Muthoot murder case pointedly targeting the state home minister Kodiyeri Balakrishnan, the No 2 man in the Pinarayi camp. Is there a sudden spring in V S Achuthanandan’s stride?



Only a Maharajah can do this. While all rival airlines were trying their best to cash in on the sudden additional demand due to the pilots stir at Jet Airways, Air India was at its royal best, putting public service ahead of business. It did not hike fares.

Also, the airline went out of its way to launch a special flight to ferry the Indian cricket team to Colombo — Dhoni & Co were earlier to fly by Jet. Considering the gesture, would the Indian cricket take a vow to fly Air India always? Not likely.

After all the team, like everybody else, is bound to insist that it was the national carrier’s duty to come to its rescue. No wonder Air India has so much red ink on its balance sheet.









With the probable exception of cricket, team sports can often tend to the irascible. But then again, these days the sight of even cricketers stopping just short of having a go at each other isn’t that uncommon.

Though one hasn’t quite got to the stage where, like in, say, football or hockey, a player can be summarily served marching orders by the umpire or referee. That, therefore, makes the spectacle of bust-ups somewhat rarer when it comes to individual sports. And that’s just what made Serena Williams’ outburst during, and consequent booting out of, the semi-final of the US open so unusual. To be sure, tennis has had its enfants terrible.

John McEnroe comes readily to mind. But with him, one assumed it was more of a given, that, ineluctably he’d be the same wild child even if playing a game of croquet in a backyard green with some pensioners. There’ve been a few other tennis players, often prone to irritability and swearing at sundry characters. But one can’t quite think of a female player ever quite behaving like this before. Perhaps only Serena could.

One notes, with admiration, she seems perfectly capable of taking care of herself. And perhaps she never really yelled “I’m gonna kill you” to the hapless lineswoman. But to give the latter her due, to witness the awesome apparition of a size Serena lady advancing with due aggression with the expressed purpose of placing a tennis ball somewhere in your larynx, would surely be cause for taking self-preservative measures.

Serena, of course, surely didn’t mean to actually do it. Even though she would, in all probability, have lost the match anyway. But, perhaps, what the incident did signify was a certain narrowing of the gender gap in the game. Gone, one already knew, were the days where ladies tennis meant more finesse than brawn.

And now, displays of competitive aggression also seem headed the same way. Some, perchance, would aver that players like the Williams sisters have injected a new raw power into the game. But, that doesn’t mean going the Neanderthal way. Not quite egalite.









The finance ministry’s memorandum to all the ministries to trim wasteful expenditure was well intentioned, as it wanted them to cut non-plan expenditure by 5-10%. And why not, when the fiscal gap could get wider amid sluggish tax revenue growth and expenditure on programmes such as NREGS would be much higher than budgeted?

Unfortunately, but not surprisingly, the central point of the advice got side-tracked by tokenism ministers were required to observe. The finance minister had advised his colleagues and the bureaucracy to avoid first class and business class when flying domestic routes for a year, and to use government facilities instead of five-star hotels for conferences.

The government would not have saved much on this count, but it would be seen as politically correct at a time when parts of the country were suffering due to poor performance of the monsoon. However, cutting non-plan expenditure by 5% in the current fiscal year would translate into saving of Rs 35,000 crore, equivalent to 12% of the budgeted revenue deficit or about 9% of the budgeted fiscal deficit.

Sections of the government have acknowledged several times in the past that there is enough room to cut non-plan expenditure, particularly establishment and people cost on projects that have been completed. Yet, there is an unwillingness to do so. Because it will involve consolidating projects and redeploying people, and in many instances, transferring projects to the states. Expenditure control will also include reducing the size of the government.

This is not the first time general instructions have been sent out on observing austerity within the government. The ongoing debate on austerity gives the impression that the finance ministry wants to micro-manage how every ministry should spend every rupee. That is not the case, as the FM has clarified. The onus on rationalising and cutting costs has been left to the financial advisors. The broad advice is that expenses on travel, professional services, advertising and publicity, office expenses and petrol should be curtailed by 10%. Surely, that is not too much to ask.








It is a year since the iconic investment bank, Lehman Brothers, filed for bankruptcy. And that nearly bankrupted most of the world! Latest estimates by The Economist suggest that with the exception of five emerging markets (China, India, Egypt, Pakistan and Indonesia) and one developed one (Australia), all major economies are likely to end the year poorer than they began.

But they will bounce back in 2010 when, with the exception of a few stragglers like Greece, Spain, Hungary and Venezuela, all are expected to register positive growth. That's a far cry from the apocalypse doomsayers had predicted back in September 2008. Stock markets, seen as forward looking indicators of economic fundamentals, are already up. (The BSE Sensex is up 64% in the calendar year to date). Does that mean policy makers have trumped the system? Not quite!

Sadly, the world is yet to address many, if not all, of the factors that led to the crisis in the first place — poor financial sector regulation and global imbalances (excess savings by China and excess consumption by the US, made possible by role of the US dollar as the international reserve currency). Within these two broad factors are a host of other reasons: perverse incentives, over-generous salaries skewed in favour of excessive risk-taking, inordinately loose US monetary policy, complex over-the-counter financial instruments, over-leveraged banks and shadow banks, to name just a few.

Instead, the focus has been on getting out of the present crisis. While that was fine when the global economy was down and out, now, when there are signs of light at the end of the tunnel, is the time to shift focus and look at longer-term sustainability.

The upcoming G20 meet in Pittsburgh later this month offers the right opportunity to do this. Sadly, if developments since the last G20 meet are anything to go by there is little likelihood of anything concrete happening at Pittsburgh.

Nation states, especially in the developed world, are yet to cede ground to the new world economic order. In which case we are only setting ourselves up for a bigger bubble a few years down the line. If that sounds like a cynical editorial line, we're sorry. We hope, more fervently than you, that we are proved wrong.










Nobel laureate Gerald M Edelman and Giulio Tononi have wondered in their book, A Universe of Consciousness, how matter becomes imagination. It’s a deep puzzle a lot of philosophers down the ages have also thought about and been baffled by. The problem had been described earlier by the legendary neurophysiologist Charles Sherrington whose poetic concern is quoted by the authors: “When I turn my gaze skyward I see the flattened dome of the sky and the sun’s brilliant disc and a hundred other visible things underneath it. What are the steps which bring this about?”

Actually something very prosaic and corporeal. Rays of electromagnetic radiation in the visible spectrum emanating from the described objects converge on the retina which converts the jumble of assorted signals into a relay of electrochemical pulses that travel to the cortex of a very material and palpable brain. But once there, Sherrington says, a very magical change happens: “A change wholly unlike that led up to it, and wholly inexplicable to us,” as he puts it. The entire thing becomes a gratifying and emotional visual experience which can then be expressed in languages we all share. How did the metamorphosis resolve from matter to imagination?

The same thing happens with all the other senses — the smell of rotting leaves, the taste of wine, the slurp of a pet dog, the sound of a tree falling in a forest when there’s someone to hear it. They’re all made of molecules, tactile pressure on skin or vibrations in the air that interact with processes in our bodies to somehow emerge into our consciousness as an affect laden awareness of things with are ultimately transferred into the world of pure imagination. Something unknown to us changes the hard, outside world into mind stuff. Or could it be that everything we call the “out there” is also made up of only mind stuff?

The current scientific paradigm assumes space, time and matter constitute the basic framework of reality but some scientists think the time has come for a another great paradigm shift now — a shift as defining as the Copernican revolution was. Instead of considering the mind to be a secondary phenomenon that results from the presence of complex matter why not turn the notion on its head and think of matter being an epiphenomenon of mind? Because when mind is primary, time, space and matter become secondary aspects of the image of reality manifesting in our consciousness.










The mavens continue to pore over figures and analyse the why, how and after-effects of bankruptcy of the major-league investment bank Lehman Brothers, on September 15 last year. It’s clear that financial innovation in the mature markets was way ahead of the curve vis-a-vis regulation and prudential norms in this decade, and especially in the run-up to the recent global financial crisis.

A recent working paper at the National Bureau of Economic Research in the US has looked into how ‘shocks to fundamentals’ that affect wealth, read capital, of key financial institutions can well set off a severe downward spiral.

The consequent downturn can impact both asset prices and market liquidity as traders and market-makers face unprecedented constraints when it comes to routine transactions, against the backdrop of bad collateral. Note that the record issues of mortgage backed securities suffered that fate when the housing bubble burst in the US. In tandem, such derivative products as credit default swaps became bud securities almost overnight.

After the failure of Lehman, the ‘spectacular’ drying up of market liquidity in equities at the American bourses was of course followed in close succession by a veritable avalanche of financial shocks in both credit markets and stock markets world-wide.

The NBER paper now offers direct evidence that declines in funding liquidity led to and essentially ‘caused’ declines in market liquidity. In particular, hedge funds – those laxly regulated investment vehicles abroad – that had Lehman as their prime broker of securities faced a sudden loss of funding liquidity. The fact is some hedge funds had all their trading position simply “frozen” after the bankruptcy filing.

The study finds that hedge funds using Lehman as prime broker were more than twice as likely to fail after September as other funds. Further, the paper shows that the market liquidity of stocks held by Lehman’s hedge-fund clients actually fell more during the crisis than other similar stocks not held by the hitherto cash-rich funds. The paper goes on to suggest that the demise of Lehman did prevent and come in the way of some hedge funds playing their liquidity-enhancing, stabilising role in the market.

Now hedge funds do differ from mutual funds in that their trading strategies and contractual relationships with investors are left quite ‘unfettered’ by regulation. For example, hedge funds are know to take on more risks than mutual funds by requiring that investors agree to tight lock-in periods. There are redemption restrictions on their investor too, unlike those for mutuals. The investment flexibility, for instance the ability to hold illiquid positions, may explain the relatively higher trend rate of return posted by hedge funds.

Hedge funds do have the leeway to take ‘short’ positions on traded stocks, use derivatives extensively and leverage their ‘long’ positions with debt. They have indeed been known to deliver high returns, provided economic conditions are sanguine. The fact remains that total assets under management by hedge funds globally went up from a relatively modest $38 billion in circa 1990 to almost $2 trillion by 2007-end.

As it happened, Lehman was a major prime broker in the marketplace. Prime brokers are in the business of providing custodial services, securities lending services, and financing to their hedge fund customers. Lehman couldn’t of course provide the required services after it failed, in the main because of imprudent exposure to real estate.

It led to investor sentiments dropping ‘sharply’ quite across the board. However, stocks held by Lehman-linked hedge funds experienced far larger declines in liquidity than other stocks. The study finds that the effect of Lehman-fund holdings was greatest among the relatively less liquid assets i.e. structured products.

Further, the paper shows that stocks with greater ownership by other institutional investors and by non-Lehman hedge funds faced ‘significantly smaller declines in liquidity’ than other stocks. A year later , things seem to be stabilising in financial terms. The massive provision of monetary liquidity by central banks, with quantitative easing and issue of government securities appear to have tackled the Great Recession. But the overall environment in finance in the main markets – with perverse incentives for risk taking – appears hardly to have changed.

(Hedge Funds as Liquidity Providers: Evidence from the Lehman Bankruptcy, George Aragon and Philip Strahan, NBER working paper, September, 2009)








Dr Vijay Kelkar recently made A very nuanced presentation on India’s gas markets at the Rajiv Gandhi Institute of Petroleum Technology in Rae Bareli. The institute is located in Rae Bareli in Uttar Pradesh partly because of its political importance this Lok Sabha constituency is seen as a pocket borough of the Gandhi household.

So Dr Kelkar speaking on India’s gas markets from such a politically meaningful location, and in the midst of a raging corporate battle over gas supply between the Ambani brothers, would have seemed quite significant. Indeed it was. For, Kelkar raised some very pertinent issues which the newly set up Empowered Group of Ministers (Egom) on future gas allocation from the KG basin would be well advised to take note of.

Before going into what Kelkar has said, it is important to set the contours of the current discussion. At a conceptual level, the debate over future gas pricing, particularly from the KG basin, hinges on two contrary views being expressed by the Ambani brothers. Anil Ambani believes that India will be gas surplus in a few years and there will be enough gas in the country to ensure every industrial consumer gets gas at less than $2 per mmbtu.

Of course, Mukesh Ambani has taken the opposite view that India, with its current growth rates, will never be gas-surplus. This view is shared by other businesses too. They say India will never be gas-surplus as more supply will automatically create even higher demand. At present, over 30,000 mega watts of captive power are being produced by diesel, furnace oil and naphta bought at over $10 per unit. These will quickly shift to gas as and when supply increases.

Dr Kelkar reckons gas production in India could go up from 120 mmscnd at present to 500 mmscnd over the next decade. But this will depend on stable policy and regulation. The credibility of governance in regard to India’s gas policy will hinge on whether we create a system that discovers a true market price, to begin with. Of course, there are other related issues which will automatically follow.

According to Dr. Kelkar “The present policy approach for gas seems to be derived from a mindset that India is relatively gas short, and this scarcity is attempted to be met through rationing, or apportioning available gas through quantitative allocation with its consequent underpricing. Ironically, this approach reinforces the shortage as it discourages supply and enhances demand as prices are not allowed to play their full role”.

Kelkar’s moot point is that a policy “which creates rent in the gas market gets reinforced through the political economy factors” allowing a number of players to share the rent. The suggestion is that a rent-seeking system will act as a disincentive to maximising the potential to produce gas. This logic also goes against any sort of compromise formula based on a cost-plus framework that government may be working on temporarily to mitigate the current controversy over gas pricing.

This framework is based on the logic that a true price discovery is not possible in the short run as demand far exceeds supply. Therefore, a cost-plus system works better in the short run. But Kelkar’s point seems to be that underpricing, even in the short run, could stultify India realising its full gas potential . This debate is very interestingly poised. The newly set up Egom headed by Pranab Mukherjee will have to take a call on this.





                                                                                                               DECCAN CHRONICAL




The Commonwealth Games Federation president, Mr Mike Fennel’s letter to the organising committee of the 2010 event in New Delhi has set the cat among the pigeons. It is an open secret that almost every Games-related project has slipped well behind the completion schedule — in fact some of the facilities were due to be put to the test by now. Instead, at venue after venue, the story — as revealed by the recent report of the Comptroller and Auditor-General of India on the subject — is the same dismal one, of missed deadlines. Little wonder, therefore, that Mr Fennel wrote: “Our main concern relates to the capacity of the organising committee to deliver operationally. Preparations for the Games are significantly behind, so much so that the Commonwealth Games Federation is extremely worried about the organising committee’s ability to deliver the Games to any comparable standard to that of the last two editions of the Games in Manchester and Melbourne.” Mr Fennel also sought an appointment with the Prime Minister, Dr Manmohan Singh, seeking his direct intervention to speed up work and to “develop an appropriate recovery plan”. With China pulling off the stunning 2008 Beijing Olympics and thereby setting a new benchmark for such massive international events, the onus was on New Delhi to at least come up with a smooth and well-run show, even if not quite up to Beijing’s magnificent standards. In the event, even that is looking increasingly unlikely, with the CGF chief also claiming that a majority of functional areas were behind schedule and that an overhaul in the management culture and operation of the organising committee was needed to avert the Games from failing “from an operational perspective”. While CG 2010 has been massively backed by both the Government of India as well as the Delhi government and a reported Rs 1,600 crore has been pumped in for the scheduled venues and the Games Village — not to mention the vast sums that have gone into various infrastructure projects all around the nation’s capital — there is a growing fear that it is not just the Games that are at stake, but the nation’s prestige too that has been put on line by Indian sports officialdom. The Indian Olympic Committee talks bravely of bringing the Olympic Games to India in 2020, but on the evidence of what has transpired in the run-up to CG 2010, it is only so much wishful thinking. Clearly the need of the hour is far tighter monitoring by government agencies than has been the case so far. Vast sums have been spent already, but with time running out fast the Suresh Kalmadi-led IOA must be made answerable in a much more practical manner than has been the case so far. Bombastic talk is all very well, but unless deeds can match words it is the country that faces the prospect of international embarrassment. Given India’s stature as a power of the not-too-distant future, that simply cannot be allowed to happen. If need be, a high-powered committee needs to be urgently set up to monitor on a day-by-day basis work on every aspect of the preparations — be it the stadia, practice facilities, athletes’ accommodation, roads and all other civil projects. It is a vast task, but having dragged matters to this sorry pass, there is now no alternative but to crack the whip on those responsible, be they administrators, contractors, planners or executors of Games-related projects.








After the defeat of Japan’s Liberal Party, which enjoyed power for 54 years, its leader accepted his responsibility and immediately resigned. During the last 10 years, the Tory Party in England has made several changes in its leadership.

In India, however, the Bharatiya Janata Party (BJP) and the Communist Party of India-Marxist (CPI-M) continue with the leadership that brought them defeat in the recent Lok Sabha elections. The BJP, at least, has the Rashtriya Swayamsevak Sangh (RSS) to take over the reins and is bound to listen and follow the directives of its chief, Mohan Bhagwat. But the CPI(M) continues with its absurd policies and defeated leaders.

Mr Bhagwat has asked the BJP to make generational changes. So Mr Lal Krishna Advani would eventually have to give up his post of the Leader of the Opposition in the Lok Sabha. As Mr Bhagwat is not happy with the coterie that surrounds Mr Advani and the BJP president, Mr Rajnath Singh, he is likely to select someone from outside this coterie to replace Mr Advani and Mr Singh.

Mr Bhagwat is not the first RSS chief to suggest a generational change. K. Sudarshan insisted on it much earlier. But now, as the BJP has lost two elections in a row, the leadership is left with no option but to abide by Mr Bhagwat’s directive. This time the BJP has also had to face an internal revolt that was essentially against Mr Advani. The defeat in the election had demoralised the party and now, with the departure of the central leadership, every state organisation would be on its own, at least for some time. Mr Advani and those in his close circle could have avoided this ignominy by making changes on their own. Because of their short-sightedness they now have to grumblingly follow the RSS’ diktats.

Calling the BJP “Blunderland”, Mr Arun Shourie asked for wholesale dismissal of its leadership and a takeover by the RSS. This was rejected by Mr Bhagwat by saying that the RSS is a cultural organisation that is not interested in fighting elections. This claim is not entirely accurate.

It is true that the RSS has always claimed to be a cultural organisation, but things changed when Mr Bhaurao Devras succeeded Mr Madhav Sadashiv Golwalkar as the RSS chief. He, of course, also stressed the cultural aspect of his organisation but was not totally averse to electoral politics. This became evident at the time of the 1971 Lok Sabha elections. Convinced that not Jan Sangh but Indira Gandhi’s Congress would defend the interests of Hindus, the RSS surreptitiously supported Congress candidates and that resulted in the Jan Sangh’s miserable performance.

Eventually, when the agitation against several state governments gathered momentum under the leadership of Mr Jayaprakash Narayan, thousands of RSS volunteers joined him. And after Indira Gandhi proclaimed Emergency, they courted arrest. In those days Mr Nanaji Deshmukh was a close confidant of JP which socialists did not approve. The elections after the Emergency saw Congress out of office at the Centre and several parties, casting aside their identities, formed the Janata Party of which Jan Sangh was a constituent.
Madhu Limaye and Mr George Fernandes raised the question of the dual loyalty of the Jan Sangh though it was not this but Mr Charan Singh and Mr Raj Narayan’s revolt that brought down the Janata ministry. Indira Gandhi came back with a thumping majority and the Sangh had its second incarnation as the BJP, with RSS regaining the position of a mentor.

It was a common perception that though Mr Atal Behari Vajpayee was respectful to RSS chiefs, it was Mr Advani who enjoyed their confidence. That was why Mr Vajpayee initially could not give a ministerial berth to Mr Jawsant Singh due to pressure from the then RSS chief.

A columnist, who is close to both the BJP and the RSS, has said that even before the last elections, about 250 RSS pracharaks had been appointed on different levels in the BJP. Some of them are even state-level secretaries. It is also known that most members of the BJP’s national executive have Sangh background.
So the RSS cannot absolve itself of its responsibility in the electoral defeat. Can Mr Bhagwat claim that his organisation is as strong as before? Its ranks have dwindled over the years. Is this not a reflection on its leadership?

Now that the RSS has started openly micro-managing the affairs of the BJP, the logical step would be to takeover the party. But if the organisation continues with its present ideology, it would be unable to get any allies and a disastrous defeat in the next elections is certain.

The BJP is not going to gain strength under the leadership of Mr Advani. His departure, along with his cozy circle, will make no difference either. But the RSS takeover is also bound to result in a fiasco.

The belief that the RSS is very powerful is a myth. If it holds any internal elections, dissentions would immediately come out. With the takeover of the BJP, it would have to face elections for the state Legislative Assemblies as well as for the Lok Sabha. It would be a delusion to suppose that an RSS-managed BJP would remain above groupism, cronyism and corruption.

All these years the RSS has been enjoying power without responsibility. It had the luxury of speaking in general terms without spelling its agenda for economic and social change. The so-called moral authority of the RSS is also required to be tested. But the fact remains that when it joined the agitation against Emergency, people regarded Mr Jayaprakash Narayan as a moral force and not the RSS.

It is worthwhile to note that after Independence, some Gandhians thought that they would enjoy power without responsibility, thinking that they were morally superior. But both Pandit Jawaharlal Nehru and Sardar Vallabhbhai Patel quietly sidelined them. BJP leaders could not follow this example.








PRESIDENT barack OBAMA will have a hard time achieving his foreign policy goals until he masters some key terms and better manages the expectations they convey. Given the furore that will surround the news of America’s readiness to hold talks with Iran, he could start with “engagement” — one of the trickiest terms in the policy lexicon.

The Obama administration has used this term to contrast its approach with its predecessor’s resistance to talking with adversaries and troublemakers. His critics show that they misunderstand the concept of engagement when they ridicule it as making nice with nasty or hostile regimes.

Let’s get a few things straight. Engagement in statecraft is not about sweet talk. Nor is it based on the illusion that our problems with rogue regimes can be solved if only we would talk to them. Engagement is not normalisation, and its goal is not improved relations. It is not akin to détente, working for rapprochement, or appeasement.

So how do you define an engagement strategy? It does require direct talks. There is simply no better way to convey authoritative statements of position or to hear responses. But establishing talks is just a first step. The goal of engagement is to change the other country’s perception of its own interests and realistic options and, hence, to modify its policies and its behaviour.

Diplomatic engagement is proven to work — in the right circumstances. American diplomats have used it to change the calculations and behaviour of regimes as varied as the Soviet Union, South Africa, Angola, Mozambique, Cuba, China, Libya and, intermittently, Syria.

There is no cookie-cutter formula for making it work, however. In southern Africa in the 1980s, we directed our focus toward stemming violence between white-ruled South Africa and its black-ruled neighbours. This strategy put a priority on regional conflict management in order to stop cross-border attacks and create better conditions for internal political change. The United States also engaged with the Cubans in an effort aimed at achieving independence for Namibia (from South Africa) and at the removal of Cuban troops from Angola. In Mozambique, engagement meant building a constructive relationship with the United States, restraining South African interference in Mozambique’s internal conflicts and weaning the country from its Soviet alignment.
More recently, the Bush administration’s strategy for engagement with Libya ultimately led to the re-establishment of diplomatic relations and the elimination of that country’s programmes to develop weapons of mass destruction.

While the details differ, each case of engagement has common elements. Engagement is a process, not a destination. It involves exerting pressure, by raising questions and hypothetical possibilities, and by probing the other country’s assumptions and thinking. Above all, it involves testing how far the other country might be willing to go. Properly understood, the diplomacy of engagement means raising questions that the other country may wish to avoid or be politically unable to answer. It places the ball in the other country’s court.
Engagement, of course, comes with risks. One is that domestic opponents will intentionally distort the purposes of engagement. Another risk is that each side may try to impose preconditions for agreeing to meet and talk — and ultimately negotiate. But we will not get far with the Iranians, for example, if we (and they) insist on starting by establishing the other side’s intentions.

Another risk is that, no matter what we say, the rogue regime may claim that engagement confers legitimacy. A more consequential danger is that a successful engagement strategy may leave the target regime in place and even strengthened, an issue that troubled some critics of the Bush administration’s 2003 breakthrough that led to the normalising of relations between the United States and Libya.

But by far the greatest risk of engagement is that it may succeed. If we succeed in changing the position of the other country’s decision-makers, we then must decide whether we will take yes for an answer and reciprocate their moves with steps of our own. If talk is fruitful, a negotiation will begin about taking reciprocal steps down a jointly defined road. Engagement diplomacy forces us to make choices. Perhaps this is what frightens its critics the most.

As the Obama team works to fend off accusations that it is rushing into Russian, Iranian, Syrian or even North Korean arms, it will need to get the logic and definition of engagement right.

In each case, we will need a clear-eyed assessment of what weare willing to offer in return for the changed behaviour we seek. Engagement diplomacy may be easier to understand if the Obama administration speaks clearly at home about what it really requires.


Chester A. Crocker, a professor of strategic studies at the Walsh School of Foreign Service at Georgetown University, was an assistant secretary of state for African affairsfrom 1981 to 1989.








Exactly one year ago, the Wall Street investment bank Lehman Brothers was allowed to go bust, in a move that is generally seen to have brought on the global financial crisis. Shock waves hit the financial markets; stock markets collapsed in waves of contagion across the world; credit seized up in most developed and many developing economies; and for a while it really did seem that global capitalism was facing direct threats to its very survival.

The collapse was not entirely unexpected. The implosion of the US housing market over the past year had already exposed the massive fragilities in the global financial system, with institutions interlocked in such opaque ways that the full extent of liability was not known even to the most experienced players. In consequence, the summer of 2008 had already witnessed the US Federal Reserve bailing out several major financial institutions, beginning with providing a dowry for the failing bank Bear Stearns in its shotgun marriage with JP Morgan, and then going on to protect and then effectively nationalise the mortgage holding agencies Freddie Mac and Fannie Mae. It was well known that many major investment banks and other financial institutions (such as the insurance giant American International Group) were all extremely vulnerable, and short-selling by those betting against such institutions only hastened the likely denouement.
After the Lehman Brothers debacle, the US government, and indeed other governments in Europe and elsewhere, swung into action on an unprecedented scale to prevent what seemed like a possible financial and economic catastrophe of global dimensions. Monetary policy was loosened to the absolute limit and fiscal stimuli were introduced to maintain spending. Most of all, there were more bailouts: huge injections of liquidity that directly and indirectly benefited certain big financial players who were seen as integral to the functioning of the system.


One year on, it can be said that that particular crisis was averted. The world economy went into recession, but did not collapse altogether. Today there is talk of recovery everywhere, even in currently recessionary Europe and certainly in the US. So was the emergency response successful? And have policymakers learned important lessons from the crisis?


Unfortunately, this does not seem to be the case. Most significantly, hardly anything seems to have been learned in terms of required regulation of finance. Despite overwhelming evidence to the contrary, there has been no moving away from the “efficient markets” hypothesis that determined the hands-off approach of governments to the financial sector. Financial institutions have been bailed out at enormous public expense, but without changes in regulation that would discourage irresponsible behaviour. Banks that were “too big to fail” have been allowed to get bigger. Flawed incentive structures continue to promote short-term profit-seeking rather than social good. So we have protected private profiteering and socialised its risks.

One of the worst consequences of this flawed manner of dealing with the crisis is that moral hazard is now more pronounced than ever. The Palgrave Dictionary of Economics defines moral hazard as “actions of economic agents in maximising their own utility to the detriment of others, in situations where they do not bear the full consequences”. In financial markets, these problems are especially rife because such markets are anyway characterised by imperfect and asymmetric information among those participating in the markets.

The moral hazard associated with any financial bailout results from the fact that a bailout implicitly condones the earlier behaviour that led to the crisis of a particular institution. Typically, markets are supposed to reward “good” behaviour and punish those participants who get it wrong. And presumably those who believe in “free market principles” and in the unfettered operations of the markets should also believe in its disciplining powers.
But when the crisis hits, the shouts for bailout and immediate rescue by the state usually come loudest from precisely those who had earlier championed deregulation and freedom from all restriction for the markets. The arguments for bailout are related either to the domino effect — the possibility of the failure of a particular institution leading to a general crisis of confidence attacking the entire financial system and rendering it unviable — or to the perception that some institutions are too large and too deeply entrenched in the financial structure, such that too many innocent people, such as small depositors, pensioners and the like, would be adversely affected.

The problem is that this leads to both signals and actual incentives actually encouraging further irresponsible behaviour. Both financial markets and government policies have operated in such a way that those running the institutions that might or do collapse, typically walk off from the debris of the crisis not only without paying any price, but after substantially enriching themselves further. Because those responsible for the crisis do not have to pay for it, they have no compunctions in once again creating the same conditions.

This is why these enormous bailouts should have been accompanied by much more systematic and aggressive attempts at financial regulation, to ensure that the same patterns that led to this crisis are not repeated. Similarly, there must be regulation to prevent speculative behaviour in global commodity markets, which can otherwise still cause a repeat of the recent crazy volatility in world fuel and food prices that created so much havoc in the developing world.

This opportunity wasted by governments — reflecting the lack of basic change in the power equations governing capitalism — will prove to be expensive. We should brace ourselves for an even worse replay of the financial crisis in the foreseeable future. And the lopsided government response — benefiting those responsible for the crisis without adequate concern for the collateral damage on innocent citizens — may give public intervention a bad name, at a time when we desperately need such intervention for more democratic and sustainable economies.








As China approaches the 60th anniversary of Communist rule, the issues that have challenged its internal consolidation are once again taking centrestage. While the country has been showing remarkable economic progress and has also taken on a regional leadership role, in terms of balancing its internal problems China will remain a critical region to watch. Barely two months after the outbreak of ethnic violence in the northwestern province of Xinjiang, another spate of violence that erupted last week brings the focus on Xinjiang once again.
In July, the Xinjiang Uighur Autonomous region witnessed intense clashes between ethnic Uighurs and the Chinese Han population, in which 184 people were killed. The trigger was the murder of an Uighur national working in a factory by a Han Chinese. The clashes that broke out between the two communities brought the capital, Urumqi, to a virtual halt. What is significant is that it actually resulted in the Chinese President, Mr Hu Jintao, leaving the Group of Eight (G-8) summit and returning from Italy to address the deteriorating situation in the region.

In the wake of these clashes, the Chinese government placed Xinjiang under heavy police controls to ensure that violence didn’t erupt in the region again. Despite these controls, last week’s violence in the region once again points to the vulnerability of the internal situation in Xinjiang province. China was quick to place the blame for the July clashes on inflammatory speeches made by the leader of the World Uighur Congress Rebiya Kadeer. Exiled and in the United States, Ms Kadeer heads the separatist demand and leads the call for recognition of Uighur nationalism.

In a bizarre incident, last week the province witnessed a series of attacks where groups used syringes to attack their victims. Some reports even claimed that the syringes were allegedly filled with HIV-positive blood. According to reports from the state-run news agencies, nearly 476 people were treated for injuries from hypodermic needles. The victims are all from different ethnic communities. The attacks occurred at a time when the Chinese government is sponsoring an international trade fair at Urumqi, which is being touted as a possible region for foreign investment. The protesters stridently demanded the resignation of the local Communist Party leadership under Wang Lequan, who is seen as a hardliner and a close associate of President Hu Jintao.
At the heart of the Uighur unrest are both ethnic factors and economic issues. China’s government has been calling for ethnic unity and economic development of Xinjiang province. However, there is a huge ethnic divide in the region that has become even more intransigent by the Chinese government’s policy of encouraging the influx of Han Chinese into the region. Added to this is the deep-rooted sentiment that the region’s local Uighurs have been marginalised and deprived of their share of the local resources. And that the benefits have gone to the Han Chinese who have been given priority in terms of jobs and business opportunities.

Ethnically the Uighurs belong to Turkic origin and are predominantly followers of Islam. The region lies in the northwestern parts of China and borders Mongolia and the Central Asian states. The region for much of its history has been an independent region of East Turkestan, which had Soviet support. It was incorporated into the Chinese state in 1949, at the time of the Communist revolution. At that time it had a majority Uighur population. Over the last 60 years, however, the region’s demographic patterns have altered as a result of the Han influx.

The Chinese encouraged a “go west” policy, which allowed the dominant ethnic community to move to regions where there were ethnic minorities. Several phases of Han migration to the Xinjiang region took place. Critically, this challenged both the local identities and impinged upon issues of resource sharing and the availability of job opportunities.

There are critical issues on which the Uighurs have been clamouring for change. First is with regard to the issue of political representation — even though it is an autonomous region, there is very little political participation from among the Uighurs. Most of the administrative and economic bodies do not have adequate representation by the Uighurs. Second, in terms of employment, the steady influx of Han Chinese has reduced the opportunities for the local population, which is one of their main demands. Third, in terms of education, too, the use of Mandarin as the medium of instruction in government schools has led to an undermining of local traditions and the native language. This has led to some tough choices in terms of choosing between native and government schools. Job opportunities are more forthcoming for those who have been given training in Mandarin. The flip side is that decreased job opportunities in the region are forcing several ethnic Uighurs to move out of their homes in search of employment. Fourth, the region is extremely rich in natural resources. Both in oil deposits and in minerals, the region is one of the richest. Much of the region’s wealth has been directed towards the growth that China is pushing for. As a result, the region itself remains impoverished. This uneven distribution of wealth between the Centre and the province will have a critical impact in the years to come.

In the aftermath of last week’s incidents, the Chinese government has been quick to state that it can competently handle issues relating to social stability and national unity. One of the issues as far as the Uighur movement is concerned is that China has been able to effectively use its diplomatic skills to propagate that the Islamic Uighur community is linked to groups like the Al Qaeda in the post-September 11 scenario. This has been one the factors that has allowed for the Uighur movement to get much less attention than it actually deserves. With the growing emphasis on terror linkages with Islamic communities in the region, China has been able to divert attention from problems of internal consolidation. Unlike the case of Tibet, the Uighur problem has received less international attention because of its alleged linkages with terror groups. This too has made the Chinese policy in the region go largely unnoticed. And given the manner in which China is changing the social landscape in both Tibet and Xinjiang, there is serious concern that Xinjiang may slip into a state where the currently perceived links to terror groups may, in fact, become a reality.


Dr Shankari Sundararaman is an associate professorof Southeast AsianStudies at the School ofInternational Studies,JNU












THE war in Afghanistan seems never-ending. Civilians die every day. With each civilian death Taliban gains legitimacy. With each civilian death the Afghan public shifts loyalty from NATO to Taliban. The International Council on Security and Development (ICOS) has been monitoring the Taliban growth in Afghanistan since 2007. It tracked daily reports of incidents which indicated Taliban presence. Presence was defined by at least one if not more insurgent attacks every week. The findings were that 80 per cent of Afghanistan has a permanent Taliban presence and 97 per cent a substantial presence.

The West is out of its depth in dealing with Af-Pak. India is best placed to resolve the issue. India has common regional interests with Pakistan even if Islamabad refuses to acknowledge it. India has traditional friendly ties with Afghanistan. India along with her neighbours will eventually pay the price of a delayed Afghanistan settlement. On June 7, 2009, I wrote in these columns: “A peace proposal should be prepared and announced even before fighting ends and the Taliban agree to talk. The terms of the peace formula might well facilitate an earlier end to fighting.”

Every day it becomes clearer that peace proposals cannot endlessly await the end of hostilities. It becomes clearer that the war needs a peace proposal for its early cessation. What might that peace proposal be which India should push forward in Afghanistan?


FOR a start perish the thought that Afghanistan can immediately leap-frog to a western style democracy. Let the West nurse that daft idea. Afghan society is tribal and medieval. The first requirement is for the people of Afghanistan to feel that they are ruling themselves without outside interference. Establishing self-governance, not democracy, should be the prime goal. Once self-governance is achieved, democracy through interaction with the outside world by trade, aid and business can follow. This presupposes that the traditional social norms of Afghan tribal society should be allowed to function. These will adjust to a modern era gradually through the volition of the Afghan people themselves.

By which formula might the multi-ethnic tribes of Afghanistan establish self-governance? Traditionally the majority Pashtuns have ruled Afghanistan. But after the Soviets were expelled from Afghanistan restiveness of the Tajiks, Uzbeks and Hazaras has defied stability. President Hamid Karzai is attempting to retain Pashtun supremacy by making deals with the warlords of different ethnic tribes. His main opponent, Abdullah Abdullah, who is half Pashtun and half Tajik wants to create a federal Afghanistan. Actually the two approaches are complementary. For success there would have to be some power- sharing between tribal leaders and the respective warlords of the various tribes. Therefore, whatever the final result of the Afghanistan election, a national consensus to govern the nation would be highly desirable.

President Karzai has claimed that if elected he will call a meeting of Loya Jirga, the Grand Council of all the tribal leaders which is constitutionally the highest decision- making body in Afghanistan, to invite all the militants and ask them to lay down arms. This is an excellent idea that would be more achievable if it were accompanied by the offer of granting federal governance to the different ethnic regions in the country.
India should promote this idea. It should talk directly to the main contenders in the Afghanistan presidential election. India should also approach the Pakistan leader, Fazlur Rehman, who has influence with the Pakistan based Taliban. Rehman visited India not too long ago and called on the Deoband leaders because he subscribes to their ideology. The problem of course is Pakistani intransigence. To tackle that India also has leverage.


Last Wednesday President Zardari told London’s The Financial Times: “Afghanistan and Pakistan are different countries and cannot be lumped together for any reason.” He said that Pakistan has functioning institutions while Afghanistan is shattered by decades of ethnic conflict. One smells panic in his response. What kind of institutions are at work in the Federally Administered tribal belt of Pakistan? As for ethnic divisions, Zardari should reflect on whether the Pashtuns in the NWFP are ethnically closer to their tribal brothers in Afghanistan or to the Punjabis and Sindhis of Pakistan. Zardari’s nervousness is understandable. The unimplemented Durand Line Treaty, which lapsed in 1993 and by which Pakistan’s tribal belt was to be returned to Afghanistan, hangs like the Damocles sword over his head.

So what leverage can India exercise to play a constructive role with both Pakistan and Afghanistan? If our government has courage and vision it can play the Kashmir Card. I repeat: It is only in the context of a South Asian community with common defence and common market that a Kashmir peace settlement which does not disturb existing international borders can be found. Likewise, only in the context of a South Asian community can an Afghanistan-Pakistan peace formula that does not disturb international borders be found.
India will lose nothing by putting forward this proposal. If accepted in principle it could be implemented only after terrorism is eliminated. Its acceptance in principle could conceivably go a long way in eroding public support for terrorism inside both Pakistan and Afghanistan. Our government should learn to think boldly and out of the box. The West cannot help us. We can help ourselves and the West.








THE Prime Minister is reported to have told a meeting of the Planning Commission that the economy was returning to normal with the end of the global recession. He has repeatedly stressed the need to increase the growth rate to nine per cent in order to reach the benefits to the people. The commitment to increase the growth rate is welcome, but the common man may yet not reap the benefits of this growth.


We will have to adopt the latest technologies to the attain high rate of growth. We will have to use automatic powerlooms instead of handlooms to reduce the cost of production and compete in the global economy. Several automatic looms are controlled by one highly skilled operator sitting before the computer in a modern textile mill. Such factories lead to high production, but create few jobs. Industries across the board are using automatic machines. A sugar factory, that employed 2,000 workers two decades ago, now employs only 500. Various operations such as unloading sugarcane, feeding bagasse to the boilers and cleaning of sugar in centrifugal machines have been automated.


THE businessman is keen to substitute labour with machines because the cost of labour is increasing while the cost of capital is declining. A decade ago the daily wage of an unskilled labourer was about Rs 60. It has now increased to Rs 120. On the other hand, the cost of capital has declined. Loans are now available at 12 per cent interest, against 16 per cent earlier. This change in relative prices makes it profitable for the businessman to invest in capital-intensive centrally controlled automatic machines. The logical result of economic growth, therefore, is slower creation of employment and increase in unemployment. The demand for highly skilled engineers and computer operators does increase, but the demand for the unskilled and semi-skilled workers declines. The march of economic progress is fundamentally against the interests of the common man.
The proof lies in the writings of Karl Marx in the nineteenth century. England was called the ‘workshop of the world’ at that time. It was exporting steam engines, boilers and textiles all over the world. Yet its own workers were in dire straits. Thus Marx wrote, ‘Workers have nothing to lose but their chains’. The same grim picture has been painted graphically in Charles Dickens’ novels. This long term anti-poor tendency of economic growth is often covered up by the short-term tendency of creating jobs in new technologies. This is happening in the IT sector.

The common man can yet draw benefits from economic growth if the government formulates suitable policies. For example, the British recognized trade unions in the nineteenth century. That enabled the workers to secure higher wages by resorting to strikes. The Factory Act limited the number of hours a worker was required to work in a day. Later, free housing and healthcare for the people was also provided. High levels of taxes were imposed upon business enterprises and the revenue was used to provide welfare facilities to the common man.
The National Employment Guarantee Scheme is precisely such an intervention. First, big business enterprises are being given a free run as evident in the creation of Special Economic Zones. Then taxes are collected from these businesses, the revenues used to run the NREGA and relief is provided to the common man.
This policy has to contend with two problems. The first relates to corruption and leakages. The government has to impose high levels of taxes. This leads to more corruption. For example, about 9 per cent of the national income was collected by the Centre by way of tax during the BJP regime. This has now risen to 11 per cent in tandem with increased expenditures on NREGA etc. This leads to more corruption as high rates of import duty on gold had once led to rampant smuggling.

Then there is the problem of leakages from the welfare programmes. Village chiefs have told this writer that they have to pay a 20 to 40 per cent cut to the government officials for obtaining sanctions and payments for NREGA schemes.

The second problem concerns the mental makeup of the beneficiaries of the welfare schemes. The handloom weaver, who was earlier in independent business, is now dependent on the NREGA. Previously, he was concerned with the design, purchase of yarn and sale of cloth. Now he wonders when the work will start under the employment guarantee scheme. From free dealings of the market, his focus has shifted to the village chief. He has even lost his self-esteem, dependent as he is on the assistance doled out by the government.
The government must consider an alternative approach to avoid the problems of corruption, leakage and dependence. Business enterprises must be encouraged to use more labour and less capital. The reduction in interest rates has made it profitable to use capital-intensive machinery. If there is a parallel reduction in the wage rate, then the businessman will have no incentive to substitute capital for labour.


THE government can introduce a scheme to provide employment subsidy to businessmen. An amount of, say, Rs 60 per manday of employment can be paid to business units. This will reduce the cost of labour to be borne by the businessman from the present Rs 120 to Rs 60. Lower cost of labour will nullify the impact of lower cost of capital and encourage businessmen to employ a large number of workers. Similarly, higher rates of commercial and income tax can be imposed upon capital-intensive units. Lower rates of excise duty can be made applicable for inputs such as yarn used by the handlooms. Government contracts should stipulate the use of labour for digging trenches for the laying of optical fibre cables and similar projects. This will generate employment. It will also encourage self-employment among weavers. Generation of employment from such a policy will reduce the need to impose a high level of taxes.

Such welfare programmes as the NREGA are not efficient from the economic standpoint either. We can compare two sets of policies. One policy is to first give full freedom to big businesses to curtail employment. The government will then impose taxes on these units and implement the NREGA and other welfare programmes. The second policy is to impose restrictions and provide incentives to create jobs. Business enterprises are at the receiving end in both alternatives. They have to pay higher taxes in the first policy and they have to face restrictions in the second policy. The people clearly stand to gain in getting jobs from the second policy. But, it seems the government is not interested in giving employment subsidy because its employees will then be deprived of the opportunity to collect cuts and commissions.







AN insurgency is fought like a war rather than a battle. So valid are the objections the Army has raised to the essentially political move to withdraw the legal shield that the Armed Forces Special Powers Act provides the troops from units deployed in those parts of Jammu and Kashmir where militant-violence is perceived to have declined. It would be extremely difficult for soldiers to observe different sets of regulations in different areas, more so when militants ignore administrative divisions. New complexity would be injected into an already tricky operational environment. The simple jawan confronting militants (with virtually no public support) would be left wondering about the objectives of his mission.

The J&K chief minister, and perhaps the Union home minister too, might feel encouraged by the islands of relative tranquility they discern in J&K, but they cannot overlook the sea of militancy that surrounds them. It is true that the use/abuse of the AFSPA has been adversely commented upon for decades, it is seen as the cause of much of the alienation of the folk of the North-east, even the Law Commission has advocated its being junked. Hence it is time to take a call on the Act itself: selective application is an unprincipled proposition, even if some political advantage may accrue. You can’t issue a soldier a bullet-proof jacket that caters to only one side of his chest.

It is, in fact, time to take an even larger call on using the Army to quell internal disturbance. As the most potent “weapon” of the nation it must be summoned only when all else has proved ineffective, and deployed on short, surgical duties. The manner in which areas remain designated “Disturbed” for years testifies to gross administrative and political failure. The army’s job is to protect the nation against external aggression, and even though “sponsored” low-intensity conflicts or proxy wars are now in vogue, olive green is no alternative to khaki. It is not a question of which force is better trained and equipped, but a question of whether the locally elected government has the political will to conduct the multi-pronged action required to resolve an insurgency. Calling the Army out at the drop of a hat, then asking it to fight with one hand behind its back is to be squarely condemned. And selective application of AFSPA would render Omar-Chidambaram a comic duo. Only, the soldiers would find nothing to laugh at.







MARITIME trade from Orissa has suffered a huge setback with the sinking of the Mongolian vessel, Red Rose, barely six kilometres from the bustling Paradip port last Wednesday night. Unlike Kolkata or Haldia, it isn’t the shallowness of the water that hobbles ship movement in the port area. While the river is managed better and effectively dredged in Orissa, it was the shoddy handling of the export consignment that led to the disaster. A total of 23,847 mt of iron ore were lost in the waters along with the ship. And with it a fairly substantial amount in terms of foreign exchange. The centrally important fact, which ought to be the focus of any inquiry, is that the ore wasn’t protected from the torrential rain in Paradip over the past few days. The dampness increased the weight of the consignment to a level that the ship couldn’t bear. This is the fundamental lapse for which the stevedores and, to a lesser extent, the port authorities are accountable. Not least because Paradip port has been handling iron ore for export since its inception. Thursday night’s signal that a Vietnamese vessel is tilting off Paradip is also suspected to be on account of an overloaded deck. Mercifully, it was brought to the shore soon after the SOS.

Thankfully there has been no oil spill from either of the vessels, as initially feared. The Mongolian vessel was carrying 900 mt of fuel. The Paradip port authorities can be complimented for having checked the spill in parallel with the rescue operations; 26 of the 27 crewmen have been brought to safety. A seepage would have caused an environmental hazard. While the waters have been protected, the two incidents in a span of 24 hours, highlight the need to handle such cargo with far greater care than has been in evidence particularly during the monsoon. At stake is the reputation of both the private stevedores and the Paradip port authorities.










The game is always more important than any individual, no matter how big a star that individual might be. There is the story that in a village cricket match, W.G. Grace, given out first ball, told the umpire that the people had come to see W.G. bat and not see him umpire. The grand old man of cricket, despite all his protestations, had to leave because he was deemed to be out by the laws of cricket. Serena Williams, one of the reigning tsarinas of tennis, was forced out of the US Open on grounds of misbehaviour. Her behaviour was deplorable. She not only challenged an umpire’s decision but also went on to abuse the umpire and even threatened to shove the ball down the line judge’s throat. Quite rightly, such behaviour and language were found to be unacceptable and she paid the penalty by losing the match. All that can be said in favour of Ms Williams is that she accepted her punishment with good grace. There are two aspects to this incident that need to be highlighted and commented upon. One is the aggressiveness that produces this kind of behaviour. Modern sport is very competitive, and nobody denies that the faint-hearted and the humble cannot succeed in such an atmosphere. There is, however, a very thick line that demarcates aggression and bad and unsportsmanlike behaviour. Ms Williams overstepped that line. It was much more than a foot fault.


The other point is wider and has some relevance to India. The judge at Flushing Meadows had no hesitation in enforcing the rules against one of the greats of tennis who is also the local star. She went by the simple principle that rules apply to everyone without exception. There is an important lesson to learn from this. In India, very often, this principle is not applied when the person in question is a star. Many bowlers have spoken about the difficulties they faced in getting a leg-before-wicket decision against Sunil Gavaskar. Very few umpires in India will have the courage to take disciplinary action against the local hero, Sourav Ganguly, in Eden Gardens. In India, sports stars are treated like prima donnas. Thus, individual stars often become more important than the game. Here examples have been drawn from cricket because cricketers in India have the maximum public following and the more successful among them are made into icons. This does neither the game nor the player any good.








What is the rule of law? Who practises it and who embodies it? These fundamental questions of civilized life come up, or are swept under the carpet, every year in Calcutta during the Pujas. This year too, with the Puja committees already well into their building of the pandals, the question of what the rules are, who enforces them, who breaks them and what happens to those who break them has arisen again — so far, in vain. The high court has asked for fresh guidelines, and this has immediately led to a deadlock because of the way the authorities addressed by the court have responded. There are four such authorities: the Calcutta Municipal Corporation, the police, the fire department and the CESC. The first three have responded to the court with a mysterious, but not unfamiliar, blankness. The logic of this blankness goes like this. There are rules; these are never obeyed because there are not enough people to enforce them; but all agree that nothing can be done about this, hence the authorities have nothing new to say to the court. So it is really up to the court to think up something, and even then, there is not much hope that what the court rules will be implemented. And everybody is back to Square One.


But Calcutta — everybody who lives and rules here — loves Square One. It is quite wrong to talk about going back to this godforsaken square, for Calcuttans have never left it, even in their imagination. For everybody, from the eternally busy mayor to the most junior policeman and corporation official, wanting to progress to Squares Two, Three or Four would mean more work and less revenue (official and unofficial). So nobody ever breaks the law. All pandals, even the ones erected about six inches away from somebody’s house, are perfectly legal, and all committees have their no-objection certificates in impeccable order. This is because the certifying authorities do not care about the rules. If they did, they would have had to get their act together. So, if somebody happens to be ill, on a wheelchair or in an ambulance, or if his house is up in flames, or if he simply needs to get into his car and go somewhere, or is thalassaemic and needs to get a transfusion in a blood bank, there is every chance that he would find himself tightly wedged between his own house and a pandal. And nobody, none of his city’s keepers immersed in the festivities, would be interested in pulling him out of that tight spot.









Almost a year after the collapse of the Lehman Brothers on September 15 last year — Lehman’s filing for bankruptcy triggered the virtual collapse of the global financial system — finance ministers and heads of central banks met in London last week to discuss the next steps in tackling the financial crisis and the associated global economic slowdown. The meeting, which was a precursor to the meeting of the heads of government to be held later this month in Pittsburgh, was to a large extent devoted to what can be done to prevent another global crisis from occurring.


The focus on prevention of another crisis is in itself a hopeful sign because it is an assertion that the worst is behind us, that the world economy is slowly climbing out of the deep recession witnessed during the course of the last year. Some macroeconomic data support this optimism. For instance, the International Monetary Fund has, in its latest World Economic Outlook update, revised upwards its forecast of economic growth during 2009-10. With the exception of the United Kingdom economy, most major countries are expected to participate in the recovery during the course of the current year itself.


Of course, all prudent economists are well aware that the expected economic recovery is going to be a long-drawn-out process — no one expects the global economy to grow rapidly at anything like four or five per cent even by the end of next year. All countries which were particularly hard-hit by the recession have very large levels of excess capacities in their economies with the Organisation for Economic Co-operation and Development estimates ranging from around five per cent of potential gross domestic product in the United States of America and the Eurozone, and even higher in Japan. Any large shock can completely reverse the process of recovery. Also, the slow rate of recovery almost certainly implies that further jumps in unemployment cannot be ruled out.


A crucial issue in any discussion of the steps which need to be taken by groups such as the G20 is agreement about the role of the large stimulus packages undertaken by countries such as the US, China and Germany. Although there is some amount of controversy about whether such massive injection of public money was socially desirable — one school of thought being that the capitalist system needed to be “punished” in order to ensure that the same mistakes are not repeated in the future — there is no doubt that the recession would have been for a significantly longer duration if governments had refrained from these steps.


For exactly the same reason, it is important that governments continue to extend support to their beleaguered economies. Any precipitous decline would have quite disastrous consequences for the global economy. Fortunately, this is one of the issues on which there seems to have been some agreement amongst the G20 finance ministers. In a press briefing after the meeting, the UK chancellor announced that the group felt that the stimulatory policies needed to be persevered with until “recovery was secured”.


However, the sheer size of the government stimulus packages implies that they cannot be sustained for too long. Public spending has been financed through deficit financing, resulting is astronomical levels of public debt in some countries. Whether governments can finance such high levels of debt remains a cause for concern. One reason for hope is that the earlier the world economy recovers, the earlier will governments register increases in tax revenues earned on a larger income base. Nevertheless, sooner or later, governments will have to slash the stimulus packages, and it is a pity that the “exit strategies” were not discussed in detail.


Since it was the collapse of the global financial system which caused the worldwide meltdown, it is only appropriate that the G20 leaders spent much of their time discussing measures required to strengthen the financial system. Although there was some initial disagreement between different groups, the G20 finally agreed on the broad contours of a tough regulatory framework for financial institutions. The proposed framework has three main features, the most important of which is the stipulation that banks must raise more capital. This was prompted by the recognition that banks are grossly undercapitalized. The European banks in particular also face pressure to issue more shares. Currently, these banks have often met a substantial part of their existing regulatory requirements on capital buffers by issuing complicated “hybrid” securities. These are more like debt than equity, and are likely to suffer huge losses in the event of any systemic risk. So they offer banks very poor insurance against large losses.


Another component of the new regime would require banks to retain some portion of the loans they repackage and sell as asset-backed securities. This will restrain the amount of borrowing that banks undertake outside the formal banking regime, the motivation behind such restrictions being the need to reduce the overall level of risk in the financial system.


Quite predictably, bankers and diehard believers in the capitalist system have objected to the new regulatory regime. They argue that these restrictions will limit the level of credit that banks can advance, this in turn actually harming the prospects of fast recovery. At a more philosophical level, the banking system is viewed almost as a fulcrum of the modern capitalist system, so any effort to constrain the “normal” functioning of the banking system as an attack on capitalism itself.


However, there is no evidence — either theoretical or empirical — that an unregulated market mechanism is an ideal system. Markets work best when there is “some” restriction on how individual players operate in the economy. Of course, the quantum of appropriate restrictions must depend on the situation prevailing on the ground.


For instance, the current international scenario allows banks, particularly the large ones whose possible failure can bring down the entire financial system, to obtain cash at ridiculously low interest rates. They can then engage in risky arbitrage activities, knowing that the government will bail them out if things go wrong. So, if there are no bad shocks, then they can reap huge profits. In the event of unfavourable shocks, they can look up to the government to bail them out of trouble. The effective absence of all downside risk must surely encourage unduly large risk-taking behaviour.


The absence of controls is a sure prescription for disaster. There may be scope for discussion of whether the new regulatory regime is too strict. But no one can deny the sheer necessity of putting in place a carefully constructed set of regulations governing the operation of the global financial system.


The author is professor of economics, University of Warwick








When one compares Rahul Gandhi’s working style, priorities and focus with those of the general secretaries who are handling the ticket-baazi for the forthcoming state elections — using the corrupt techniques of currying favour and of dispensing largesse instead of sensibly consolidating the Congress by rooting out the prevailing nepotism — the future looks far more positive than the present.


The only fear is that leaders of my generation, who can see their modus operandi being steadily dismantled, may conspire to derail the plans by insidiously working against every out-of-the-box move. It is the oldest trick in the book, and it stagnates growth, retards the system and gives the ineffectual a little more time under the sun. Someone must crack the whip, and actively support retirement and replacement plans for a few leaders to energize the party.


The smart, intelligent trip through Tamil Nadu, the candid meeting with the press and the excitement about wanting to begin again were refreshing. Rahul Gandhi was discreet and honest in his responses. This dignity in public space should become the benchmark for all politicians and activists. It carries far more weight than the back-room wheeling and dealing and the posturings by VIPs that have become nauseating for all Indians outside the realm of leadership and administration.


This brings me to the ‘austerity debate’ that has submerged all other news in the last few days. It is very easy to bring in corrections. The prime minister’s office and the All India Congress Committee need to spell out a clear set of rules. The manual needs to make it mandatory for Congressmen and women demitting office to vacate their official premises within one month.


New rule


Cabinet ministers must be allocated houses that have been earmarked for that particular ministry, and comprise a small, officially-appointed staff that includes a designer, an engineer and a horticulture expert. This will make it easy for ministers to vacate their premises within 48 hours, and will also allow new incumbents to enter their official residences with the dignity that comes with the office that they represent.


Ministers travelling overseas should travel business class. For a journey under three hours, they should travel economy. Anyone who wants to travel first class should personally pay the extra component of the fare. Free upgrading for ministers, bureaucrats and suchlike must be prohibited. All official entertainment should be done at Hyderabad House or the Ashoka Hotel. If the massive hotel is not up to the mark, the government should ensure that it is. The government should compel the inept India Tourism Development Corporation to clean up its act and compete with the Taj, the Maurya and the Oberoi.


Pranab Mukherjee should expose and reprimand all those ministers living where they should not be at the cost of the exchequer — in Lutyens’ Delhi where the square foot price is higher than 5th Avenue and Belgravia. If the Congress party wanted its ministers to stay outside five-star hotels, it should have made this clear on the day of swearing in regardless of who was paying the bill. There should be a rule and mandate in this regard.


There are dignified ways of doing what Mukherjee did. Seeing senior ministers indulge in ‘main main tu tu’ is unwarranted.The finance minister made a huge show about travelling economy himself, and the media kept repeating this inconsequential fact. Will he travel in a similar manner for the entire term of this government? Everyone understands such tokenisms, and it is time to kill the hypocrisy. Let’s spell out the rules in a manual, and then enforce the mandate and lead by example. Who will bell the greedy cats?








For tourists prepared to ignore the dramatics of both international and Indian national press stories, the divisions in the state of Kashmir and Jammu are less obviously the great wound between India and Pakistan and more the difference between the lush and beautiful valley with its courteous and dignified people and the barren hills of the plateau of Ladakh. Leh, the capital of Buddhist Ladakh, only a handful of decades out of the relative isolation of an inaccessible kingdom in the Himalayas, has become, for its brief summer season, a tourist and trekking hub, with foreign tourists apparently outnumbering locals in the main bazaars of the town. In the winter, though, carpeted in thick snow, the tourists and traders from Jammu and Srinagar, who cater to them, return from whence they came. Traditional Ladakhi life once again holds sway, as sociable and fun-loving locals drink local beer, chang, and party with friends and family to survive cold so extreme that toothpaste freezes in the tube and changing clothes is out of the question.


Life in Ladakh in the past could hardly be said to be easy. But the extraordinary contentment with a subsistence existence that revolved around seasons, family, community and religious ritual and festival is still apparent in the villages away from Leh, where work and play continue for the moment with much the same rhythms as in the past.


Non-governmental organizations these days struggle here as in every underdeveloped and poor area to improve health, education, nutrition, hygiene and high child mortality rates, but contemporary awareness of other lives has not so far diminished the good humour and high spirits of the Ladakhis. A passionate pride in home, place and environment is habitual among Indians, indeed to the extent sometimes that the outsider is left wondering how on earth this vast country holds together at all, even without politically inspired problems. In Ladakh, this means that most Ladakhis who leave for work or education have return as their goal and remain at all times deeply rooted in their villages and mountains.


In the Kashmir valley, too, there is enormous pride in everything Kashmir has been; beloved of Mughal emperors and as much of the less glamorous invaders of the British raj. The intensity of pride in the valley means a deep distrust of close neighbours, even of the peaceful Ladakhis, whose morality and honesty are questioned no less than those of Indians living on the plains. Kashmiris are prickly, no doubt about it. But they have been so regularly and endlessly damned by the press and by ill-informed foreign politicians with little understanding and no experience of the people or the situation of the valley that they can hardly be blamed for that. As it is, the extraordinary handicrafts of Kashmir, the exquisite shawls and carpets, in particular, have been ruthlessly exploited by greedy markets and traders, not, it has to be said, all outsiders, to the extent that there is little appreciation these days for pieces once understood to be unique works of art, now reduced to expensive commodities.


The chiru antelopes that provided wool for the fabled shatoosh shawl for hundreds of years are almost extinct, the effect of an impatient market with no care for rarity value; factories in Ludhiana and elsewhere produce thousands of pretty enough machine-made and cheap versions of shawls that would otherwise take weeks, months or even years to produce. And ersatz versions of Kashmiri carpets are made on looms around the world.


There are those like the Kashmir Loom Company and others fighting with some success for continued recognition of the old skills that make a handmade shawl or carpet as much to be valued and understood as an Old Master’s painting. They are up against other problems as young people dismiss old family traditions and skills in favour of quicker, easier ways to make a buck. It is only to be hoped that the skills can at least be kept alive by the encouragement of a few and of the discerning collectors who are their clients. It is hard though, when a carpet made by hand over two years and involving the skills of a dozen craftsmen from four or five families sells wholesale for a couple of thousand dollars, the price only rising later by hundreds of per cent for the retailers’ profit.


Tourism should be the other money-spinner for the valley, but the scare stories and the advice of foreign ministries and offices abroad have created impregnable barriers to most holiday-makers. Good value, stunning scenery, excellent food, magnificent fishing, beautiful gardens, remarkable culture and unique shopping do not, it seems, outweigh the conviction that every delight comes with attached explosions. As it is, the houseboats on the Dal and Nageen lakes are fuller than they have been; young Israelis, against all advice of their government, are the most apparent nationality both here and in Ladakh, but it is not enough. They are, as a rule, travelling on a freedom kick after compulsory military service and often more interested in cheap drink and dope than in culture and carpets.


Since I was last in Kashmir, three years ago, there have certainly been changes and not only in the weight of motor vehicles in Leh. Perhaps the wheel is turning a little towards a greater optimism. The new, young and energetic chief minister, Omar Abdullah, inheritor and emulator of a family tradition, is setting about the infrastructure of the state with a will.


The precipitous road through the mountain passes from Srinagar to Kargil and on to Leh is being improved dramatically, and even at a relatively early stage, the journey time has been cut by some hours. The promotion of skiing and winter sports in Gulmarg and Sonmarg may create a cost-effective competitor for vastly expensive skiing holidays in Europe, even including long-haul travel. Next year, there should be direct flights to Srinagar via the Gulf. As the essential infrastructure for winter tourism grows, other sports, such as golf, are being catered for with new international level courses. Omar Abdullah’s father, Farooq, was not loved for his use of public money to build a perfect golf course in Srinagar at a time of extreme insecurity, shortage of housing and public works. But such extravagance may pay dividends in time.


Meanwhile, a razor-wired and massive army presence causes the greatest depredations on the state and adds the greatest visual weight to the doomsayer stories we all read and hear so regularly. Less obvious than it was in Srinagar a few years ago, the people of the valley detest this colonizing force and the cost of its existence as it eats into state resources, and cements perceived prejudice.


Whereas in more laid-back Ladakh, a hearts-and-minds approach of school-building and fraternizing has created a reasonably easy relationship, a mistrust of the political and military centres of Hindu India, combined with local pride, does not allow any hope of a comfortable compromise in the valley. For the outside spectator, the costs of its massive army, a permanently occupying and ill-occupied force throughout Indian border territories, is, in the face of the extremes of perpetual poverty in rural and urban India, a sign of mismanagement at best, immoral at worst.


It is said that the cost of getting one egg to the troops based on the Siachen Glacier in northernmost Ladakh bordering Pakistan, is Rs 200, £2.50 or so. The costs of, and to, the Indian and Pakistani soldiers fighting a no-win on-and-off war of 17 years’ duration in a high altitude frozen hell are stratospheric. What to do? Being king of the castle on the glacier has become a matter of pride, costing both countries resources better used elsewhere.


In Ladakh, though, the metaphorical and literal clouds over the glacier that can be seen in the distance from the

Nubra valley seem far away from sunny skies and smiling people as tourism turns Leh in summer into a miniature Kathmandu.

The busy flights up from Delhi and Mumbai pour ever- growing numbers of passengers into the airport, many of whom would do themselves a favour and avoid altitude sickness if they were to spend time first in the valley and progress in acclimatizing stages to Leh by car through some of the most spectacular scenery in the world. The valley is not a bomb-at-every-corner place, but a place of culture, natural beauty and a deeply bruised psyche that appreciative and relaxed holidaymakers can do a little to salve.











Recent discussions on pay scales of the armed forces in different television channels and media reportage in the print media suggest that civil society is fairly unaware about the insulated world of the military. While the government has approved a new policy of ‘One Rank One Pension’ only for soldiers, sailors and airmen, it has neglected the officer corps. More so, considering the officer corps comprises only three per cent of the armed forces with the remainder being the other ranks. Despite Defence Minister A K Anthony’s assurance in parliament to include the officer corps the rationale for not doing so is puzzling.

Among the problems underlying this issue is the inability of the political leadership and bureaucracy to comprehend the nuances of military culture both in times of war and peace. The popular perception of the armed forces appears to be limited only to peacetime activities, and not about what transpires during war and equally dangerous, war-like or insurgency situations called low intensity conflict operations, that are perpetual in the Indian context.

The senior level civil-service officers, who are now decision makers on military matters, when on attachment with the army as probationers were given VIP treatment in the officers’ messes. This has probably given them an incorrect impression of the Service officers’ lifestyle. Our army is unique in terms of its operational environments.

Undoubtedly the air force and navy do have difficult conditions to work in — but nothing compares to the insurgency in snow-bound high-altitude areas and mountainous jungles.

Within the army, the infantry spends most of its time in field areas rather than in peace stations. Army officers and jawans work in the same conditions and not many infantry officers attend the glamourous parties of peace time army stations. There is camaraderie and no master-slave attitudes. But when our bureaucrats decide to have different policies for different cadre, men who were equals while in service are being treated differently when out of it. People, who stood together in the face of some of the most terrifying moments anyone ever sees in their lifetime, have been separated in retirement. This is unfair.

Army life is meant for resilient people. Army men have to bear years of separation from their families which contributes to an unsettled life for the wives and badly affects children’s education. During the long years of field tenure, running two establishments, wherein the army officer has to finance his own self and also ensure that his family doesn’t have to worry about normal daily expenses, many officers tend to exhaust their provident-fund which is crucial for retirement plans.

Another aspect of sacrifice is that officers have to lead from the front during war/war-like conditions; otherwise the jawans would not take a step forward in the face of bullets. It is for this reason that many young officers and company commanders have either lost their lives or have been rendered handicapped. If one considers the statistics of casualties among officers against the total number of officers in the armed forces, one will find that in sheer numbers, it is more than that for the subordinate ranks.


Even in the air force, the number of fighter/bomber pilots who are killed in action or crashes during routine flights is much higher than those among other ranks of air force. People sitting hundreds of kilometres away from the scenes of action and passing verdict should know this because in today’s day and age, public opinion matters.

The majority of infantry officers — who form the bulk of the army — have spent the prime of their lives in gruelling conditions in field areas and sacrificed the best years of their lives in the service of the nation; when these brave men return home on retirement to lead a peaceful life and are then offered an inadequate pension by a thankless nation, how would they feel?

Army men whose nerves were tested by the most perilous encounters and came back unscathed, who were not broken by the grit of hardened terrorists and who weathered everything that nature threw at them, will finally succumb to the crass reality of asking money in exchange for the priceless services rendered to the nation. The retired officers are asking for something as simple as making a policy to be applied to the entire force and not just a section of it.










Sammy here…”, This is how he addresses himself — the nickname he got in his long service in the Air Force. He is Dadanna, Swamy, Sam, Rao, but to me he’ll always be Rao Uncle. He is known for being his crisp, clear and comical self. Along with being a book of comics, he is also a walking encyclopedia!

His curses could only be matched to the Captain of the ‘Tintin’ comics. He cheats like hell in any indoor game we play… calls it making the game more interesting! If there is anything at all he lacks, it is his height which is made up with good measures of wit, charm and chivalry. Even today he opens doors, pulls a chair for a lady. We could spot my uncle and aunt from a distance as they form figure 88.

Vacations spent with them are memorable. One such day, I remember it was a Sunday, he hauled us all up ie my brothers my cousins and me and announced “me and wifey will enjoy the sun and you kids will cook lunch!” After lots of chaos in the kitchen, the food was ready to be inspected by uncle and aunt. And the verdict — “Oh these are rotis! I thought they were papads. The sabji, Oh what a massacre! Hey Lata you could make a lot of money selling your rasagollas to the golfers! This salad really needs some dressing down!” Then of course we would get our rewards, it was either ice-creams or a movie or both.

The same man in summers got up at 6 am every Sunday. He would make the morning coffee, then breakfast, lunch, dinner, do all the dishes, clean up the kitchen, everything exactly the way my aunt would want it. All this, without complaining, whistling and still ready to waltz with aunty.

Regardless of who the visitor was, a three-year old or a 73-year-old, a carpenter or CEO; all are made to feel like VIPs. The toddlers simply love him. They are thoroughly spoilt by him. “There should be only grandparents and grandchildren. The parents are a real nuisance,” he always says.

When it came to benevolence, I am amazed that he never utters a word about all the favours he does for people. Today, when I see some old people whining about everything in life, I love my uncle all the more. Sorry Sammy, I am calling you old. Next week you turn 85 and all I can say is God, wake up, hone your skills and make more men like Sammy please!








Unless something happens soon, Israelis, Palestinians and other Arabs may squander the best chance for Middle East peace in nearly a decade. President Obama is committed to serious negotiations and, for now, there is a lull in regional violence. But all of the region’s major players are refusing to do what is needed to keep their own people safe and move the peace process forward.


Mr. Obama has called on the Israeli prime minister, Benjamin Netanyahu, to freeze all settlement construction as a way to demonstrate his government’s commitment to trading land for peace.


Mr. Netanyahu, who accepted the idea of a two-state solution only grudgingly, has hinted that he might agree to a temporary freeze. In the meantime, his government has approved 455 new permits for construction in the West Bank and said that work on 2,500 units now in progress must also be completed.


That may play well in Israeli polls, but it has given Arab leaders a powerful excuse to do nothing.Mr. Obama has been urging Arab states to demonstrate their own commitment to a peace deal by signaling a greater acceptance of Israel — by granting overflight rights for Israeli commercial planes or opening consular or trade offices in Israel.


Instead of championing the idea, the United States’ closest regional allies, Egypt and Saudi Arabia, are refusing to make any of their own gestures and are actively discouraging other Arab states from acting. The Palestinian president, Mahmoud Abbas, has refused to agree to a three-way meeting with Mr. Obama and Mr. Netanyahu in New York later this month unless Israel agrees to a complete freeze.


Is there any way out of this stalemate? The White House’s Middle East envoy, George Mitchell, is back in the region this week trying to talk sense to all sides. He needs to tell them that Mr. Obama’s patience is not unlimited and that the lull in violence is almost certainly temporary.


He must remind the Egyptians and the Saudis, who are constantly looking over their shoulders at Iran, that a peace deal is the best way to check extremism and Tehran’s power. And the Gulf states, which insist that they are less mired in ancient hatreds, must be urged to step out of the shadow of Riyadh and Cairo and do what they already know is necessary.


President Obama needs to prod Mr. Netanyahu toward bolder action by making a direct — and better — case to a skeptical Israeli public on why a settlements freeze and reviving peace talks is in its interest. Mr. Obama is still hoping to bring the Israeli and Palestinian leaders together at the United Nations this month to announce the resumption of peace talks. To pull that off, he is going to have to press all of the region’s leaders a lot harder.



Mr. Obama and Mr. Mitchell have already invested eight months on confidence-building and incremental diplomacy. If there is no breakthrough soon, they may have to place their own deal on the table.








Prison inmates are the sickest people in society, with infection rates for blood-borne viruses like H.I.V. and hepatitis C far higher than the general population. Failing to test, counsel and treat these inmates makes it more likely that they will spread infection once they are released and suffer catastrophic illnesses that shorten their lives and drive up public health costs.


The New York State Legislature had this problem in mind when it passed a bill that requires the State Department of Health to ensure that prison H.I.V. and hepatitis programs are operating effectively and meet prevailing medical standards. Corrections officials, who tend to rebel against oversight of just about any kind, want Gov. David Paterson to veto this bill. He should ignore them and sign it.


The state correctional system has unquestionably improved medical care over the last several years. But a recent report by the Correctional Association of New York, which is authorized by the Legislature to monitor the prisons, found troubling inconsistencies in care in the state prison system, which is said to house 20 percent of the H.I.V.-infected inmates in the United States.


The report, based on state records, estimates that the state has identified through testing fewer than half of the H.I.V.-positive inmates and only about 70 percent of those with hepatitis C. The report finds that the number of people receiving treatment varies significantly from place to place, which is suspicious given that the population is fairly homogenous. The variation raises questions about the consistency and effectiveness of medical policies from prison to prison.


Prison medical officials argue that the treatment regime is fine and that oversight is unnecessary. But critics in the Legislature rightly point out that the prison health system is the only one in the state not overseen by the Health Department. The prison system, with about 4,000 infected inmates, is the largest provider of treatment for H.I.V., the virus that causes AIDS, in the state.


Other critics argue than the Health Department’s initiative would cost money at time when the state can’t afford it. But better diagnoses and treatment in prison would save more money than it would cost by preventing further infections and keeping many patients from moving on to costly, catastrophic illnesses.







A leading road safety group, the Governors Highway Safety Association, has reversed field and announced its support for state laws banning drivers from sending and receiving text messages. The move is a welcome response to growing evidence that texting creates a greater risk of crashing than even drunken driving.


Studies suggest that drivers who send or receive a text message tend to take their eyes off the road for about five seconds, enough time for a vehicle going at highway speed to travel more than 100 yards. The Virginia Tech Transportation Institute found that truckers sending text messages are 23 times more likely to cause a crash or near-crash than a nontexting trucker.


Texting car drivers, according to a University of Utah study using a driving simulator, are eight times more likely to crash. But fewer than 20 states prohibit texting while driving. And some of those statutes, like New York’s new law, impose minor fines and a negligible enforcement scheme that allows police officers to penalize a driver for the offense only if stopped for another infraction, such as a broken taillight or speeding.


While stronger state laws are essential, texting at the wheel is a national hazard that calls for a firm federal response. One answer would be to condition federal highway money on state compliance with reasonable safety standards. This has helped produce stronger laws against drunken driving.


A promising Senate bill — the Alert Drivers Act of 2009 — would do exactly that. It would require states to adopt federally set minimum penalties for texting while driving or forfeit 25 percent of highway financing. States would have two years to comply and could recover lost funds once they passed acceptable laws. A companion bill has been introduced in the House.


The need to crack down on this dangerous practice is abundantly clear.








Perhaps you remember the scene from “Bull Durham.” The veteran catcher, “Crash” Davis, played by Kevin Costner, is teaching the rookie pitcher, “Nuke” LaLoosh, played by Tim Robbins, the art of the sports cliché: sounding humble and gracious while saying almost nothing. The sports cliché has come a long way. Witness Serena Williams’s press conference on Saturday night after threatening a line judge in her semifinal with Kim Clijsters — an outburst that cost Ms. Williams match point.


To her credit, Ms. Williams didn’t shy away from reporters. But there was something deeply disheartening, even shocking, in hearing a player of her stature resort to the language of glib self-forgiveness. “It was what it was,” she said twice, referring to the incident. “I just go for it,” she said, forgetting that what she had gone for, verbally and with a threatening gesture, was the line judge. “I’m moving on,” she added, as if what had happened on court affected only her. When asked what she had said to the line judge, who had called a foot fault, Ms. Williams said: “I don’t remember anymore. I was in the moment.”


The faux-zen quality of that last remark is especially disturbing. We can almost hear it becoming the excuse of choice. But as it happens, everyone who saw the match live or on television was in the moment along with Ms. Williams, and we do remember. The best players in tennis — Ms. Williams is one of the very best — have the ability to put bad shots and lost points behind them.


Ms. Williams put this transgression away far too quickly and blithely — apologizing only on Monday. What she gave us on Saturday was a virtuoso display of the sports cliché, saying little and apologizing for nothing.








President Obama took a bit of a victory lap on Wall Street on Monday, declaring that the economy had been brought back from the abyss and “the storms of the past two years are beginning to break.”


The president and his economic team (and the Federal Reserve) deserve credit for moving quickly to prevent a full-blown collapse. A year ago, amid the panic that accompanied the implosion of Lehman Brothers, there were serious fears that the U.S. was headed toward another Great Depression.


Now, with the financial sector stabilized and economists predicting that the Great Recession is nearing an end, the sighs of relief coming out of Washington and Lower Manhattan are understandable. But this is no time to lose sight of the wreckage all around us. This recession, a full-blown economic horror, has left a gaping hole in the heart of working America that is unlikely to heal for years, if not decades.


Fifteen million Americans are locked in the nightmare of unemployment, nearly 10 percent of the work force. A third have been jobless for more than six months. Thirteen percent of Latinos and 15 percent of blacks are out of work. (Those are some of the official statistics. The reality is much worse.)


Consider this: Some 9.4 million new jobs would have to be created to get us back to the level of employment at the time that the recession began in December 2007. But last month, we lost 216,000 jobs. If the recession technically ends soon and we get to a point where some modest number of jobs are created — say, 100,000 or 150,000 a month — the politicians and the business commentators will celebrate like it’s New Year’s.


But think about how puny that level of job creation really is in an environment that needs nearly 10 million jobs just to get us back to the lean years of the George W. Bush administration.


We’re hurtin’ and there ain’t much healin’ on the horizon.


A national survey of jobless workers by a pair of professors at Rutgers University shows just how traumatized the work force has become in this downturn. Two-thirds of respondents said that they had become depressed. More than half said it was the first time they had ever lost a job, and 80 percent said there was little or no chance that they would be able to get their jobs back when the economy improves.


The 1,200 respondents were jobless at some point over the past year, and most — 894 — are still unemployed. More than half said that they had been forced to borrow money from friends or relatives, and a quarter have missed their mortgage or rent payments.


The survey found that affluent, well-educated workers, who had traditionally been able to withstand a downturn in reasonably good shape, were being hit hard this time around.


The professors, Carl Van Horn and Cliff Zukin, described that phenomenon as “a metric of the recession’s seismic impact.” Of the workers who found themselves unemployed for the first time, more than one in four had been earning $75,000 or more annually.


“This is not your ordinary dip in the business cycle,” said Mr. Van Horn. “Americans believe that this is the Katrina of recessions. Folks are on their rooftops without a boat.”


Stunned by the financial and psychological toll of the recession, and seeing little in the way of hopeful signs on the employment landscape, many of the surveyed workers showed signs of discouragement. Three-fifths said that they had experienced feelings of helplessness.


Said one respondent: “I’ve always worked, so this is very depressing. At age 60, I never believed I would be unemployed unless I chose to be.”


Said another: “I fear for my family and my future. We are about to be evicted, and bills are piling. We have sold everything we possibly can to maintain, and are going under with little hope of anything.”


At some point the unemployment crisis in America will have to be confronted head-on. Poverty rates are increasing. Tax revenues are plunging. State and local governments are in a terrible fiscal bind. Unemployment benefits for many are running out. Families are doubling up, and the number of homeless children is rising.


It’s eerie to me how little attention this crisis is receiving. The poor seem to be completely out of the picture.


If we end up with yet another jobless recovery, there would seem to be little hope for impoverished families in America’s big cities, rural areas and, increasingly, suburban neighborhoods as well.


The recession may be ending for some.


Tell that to the unemployed.








On Sunday evenings, my local NPR station airs old radio programs. A few weeks ago it broadcast the episode of the show “Command Performance” that aired the day World War II ended. “Command Performance” was a variety show that went out to the troops around the world.


On V-J Day, Frank Sinatra appeared, along with Marlene Dietrich, Jimmy Durante, Dinah Shore, Bette Davis, Lionel Barrymore, Cary Grant and many others. But the most striking feature of the show was its tone of self-effacement and humility. The allies had, on that very day, completed one of the noblest military victories in the history of humanity. And yet there was no chest-beating. Nobody was erecting triumphal arches.


“All anybody can do is thank God it’s over,” Bing Crosby, the show’s host, said. “Today our deep down feeling is one of humility,” he added.


Burgess Meredith came out to read a passage from Ernie Pyle, the famous war correspondent. Pyle had been killed just a few months before, but he had written an article anticipating what a victory would mean:


“We won this war because our men are brave and because of many things — because of Russia, England and China and the passage of time and the gift of nature’s material. We did not win it because destiny created us better than all other peoples. I hope that in victory we are more grateful than we are proud.”


This subdued sentiment seems to have been widespread during that season of triumph. On the day the Nazi regime fell, Hal Boyle of The Associated Press reported from the front lines, “The victory over Germany finds the average American soldier curiously unexcited. There is little exuberance, little enthusiasm and almost none of the whoop-it-up spirit with which hundreds of thousands of men looked forward to this event a year ago.”


The Dallas Morning News editorialized, “President Truman calls upon us to treat the event as a solemn occasion. Its momentousness and its gravity are past human comprehension.”


When you glimpse back on those days you see a people — even the rich and famous celebrities — who were overawed by the scope of the events around them. The war produced such monumental effects, and such rivers of blood, that the individual ego seemed petty in comparison. The problems of one or two little people, as the movie line had it, didn’t amount to a hill of beans.


You also hear a cultural reaction. As The Times of London pointed out on the day of victory, fascism had stood for grandiosity, pomposity, boasting and zeal. The allied propaganda mills had also produced their fair share of polemical excess. By 1945, everybody was sick of that. There was a mass hunger for a public style that was understated, self-abnegating, modest and spare. Bing Crosby expressed it perfectly on “Command Performance,” as Gregory Peck, Dwight Eisenhower and George Marshall would come to express it in public life.


And there was something else. When you look from today back to 1945, you are looking into a different cultural epoch, across a sort of narcissism line. Humility, the sense that nobody is that different from anybody else, was a large part of the culture then.


But that humility came under attack in the ensuing decades. Self-effacement became identified with conformity and self-repression. A different ethos came to the fore, which the sociologists call “expressive individualism.” Instead of being humble before God and history, moral salvation could be found through intimate contact with oneself and by exposing the beauty, the power and the divinity within.


Everything that starts out as a cultural revolution ends up as capitalist routine. Before long, self-exposure and self-love became ways to win shares in the competition for attention. Muhammad Ali would tell all cameras that he was the greatest of all time. Norman Mailer wrote a book called “Advertisements for Myself.”


Today, immodesty is as ubiquitous as advertising, and for the same reasons. To scoop up just a few examples of self-indulgent expression from the past few days, there is Joe Wilson using the House floor as his own private “Crossfire”; there is Kanye West grabbing the microphone from Taylor Swift at the MTV Video Music Awards to give us his opinion that the wrong person won; there is Michael Jordan’s egomaniacal and self-indulgent Hall of Fame speech. Baseball and football games are now so routinely interrupted by self-celebration, you don’t even notice it anymore.


This isn’t the death of civilization. It’s just the culture in which we live. And from this vantage point, a display of mass modesty, like the kind represented on the V-J Day “Command Performance,” comes as something of a refreshing shock, a glimpse into another world. It’s funny how the nation’s mood was at its most humble when its actual achievements were at their most extraordinary.








EARLY in the morning, a year ago today, I received an e-mail message at home from Lehman Brothers announcing its plans to file for bankruptcy. The message noted that Lehman would still be “open for business” that day.


So I headed toward the office at 745 Seventh Avenue. The television cameras and reporters were already there. I stopped to get my coffee from the street vendor and he asked how I was doing. I started to cry. I told him to keep the change from a $20 bill because I knew that if Lehman was gone he would suffer as well. I walked toward the entrance and a young woman I had never seen before said, “Another Lehmanite!” — and we walked arm-in-arm into the building. Many of us had been together for more than 10 years and were scared of being cast adrift.


We had all seen it coming, but still didn’t understand how our chief executive, Dick Fuld, could have let this happen. We were the firm with the culture that everyone envied. Yes, it had been a wild ride the previous couple of years, and especially the previous six months. We had had so many heads of fixed income that it was almost a joke when another e-mail message came around that another fixed income head had left to “pursue other interests” or “to spend more time with his family.”


We used the rest of the day to pack our boxes. Finally, in the late afternoon, I walked out of the building. I headed to a local bar to drown my sorrows and ponder the future of my career. Around West 51st Street, a homeless man approached me with a cup, gesturing for a contribution. He then looked at my tote bag with its Lehman Brothers logo and said, “Never mind” and “I’m sorry.”


LYNN GRAY, the chief executive of Campus Scout and a former senior vice president at Lehman








LEHMAN BROTHERS went bankrupt a week after I was fired. The job had few perks, long hours and little time for camaraderie, but I stayed there for 11 years. I was a single mom and needed to pay my mortgage. Then, after years of solid performance, I was fired on Sept. 9, 2008, as part of a “work force reduction.”


I had a few hours to pack my things and leave. I wasn’t allowed to download my personal files from my computer so I lost many records. I didn’t bother to say goodbye to anyone, figuring that those who even noticed could phone me, but given the troubled work environment I got few calls. I was given a typical severance package with benefits based on my long tenure.


I wouldn’t miss working at Lehman, I said to myself, but I would miss my BlackBerry. I decided to set up my own shop to provide independent research. My severance package would allow me time to establish myself.


Yet shortly after Lehman went under, I got a letter explaining that my severance contract was canceled because of the bankruptcy filing. I could keep my health plan if I chose to pay for it myself.


I was robbed first by Ben Bernanke, the Federal Reserve chairman, and Henry Paulson, the former Treasury secretary, who refused to support a sale of the company, and later by the bankruptcy judge who approved the sale of Lehman to Barclays for peanuts.


I am still unable to pay all of my bills. I know the public at large doesn’t have sympathy for Wall Street employees, but did I deserve to be robbed because of the mistakes of others?


 JANE PEDREIRA, the managing director of Clear Sights Research and a former senior vice president at Lehman








IT was late at night on Sept. 14, 2008, and I couldn’t sleep. I kept going over to the computer, looking for news of Lehman’s demise. I had lost my job in March, but I was still deeply invested in the company where I’d worked happily for four years. Many close friends still worked there. I had practical concerns as well: Much of my compensation remained in restricted Lehman shares. I feared I would be annihilated financially if the company went under.


My cell phone rang for maybe the 500th time that day. It was my former boss, a managing director and an old comrade-in-arms on the trading floor. Back in those days he almost never broke a sweat. He could lose $10 million in a day and still buy lunch for the more than 50 people who worked for him. He also loved to crack jokes: He called Lehman’s chief executive, Dick Fuld, “the invisible man” in reference to his consistent absence from the trading floor. The phrase quickly caught on.


That night, his voice was shaking. “They’re putting Lehman’s head under water,” he told me. “They’re just watching for the bubbles right now.” He seemed to be in extreme pain, as if he’d been hit by a bus, though he didn’t sound surprised.


LAWRENCE G. McDONALD, a co-author of “A Colossal Failure of Common Sense: The Inside Story of the Collapse of Lehman Brothers” and a former vice president at Lehman











For years – decades – Pakistan and India have been arresting one another's fisherfolk who have crossed an invisible line in the sea. Currently, the total number of Indian boats and fishermen in Pakistani captivity is 421 and 576 respectively. These poor men may now spend years in captivity while their boats rot on a Pakistani jetty. The sixteen arrested on Sunday by our marines were on three boats that had crossed into the Exclusive Economic Zone and thus violated our territorial waters. Four boats were originally intercepted with a total of 26 persons aboard them, some were women and children and these were sent back in one of the boats, the rest taken into our custody. They have been interrogated, interviewed by several of our domestic TV channels, transferred to the Docks police station and are slated to appear in court some time on Monday. None of them can expect to see their families in the foreseeable future.

The boats these men – Pakistani and Indian - use as their source of income and in some case use as their only home; are not state-of-the-art fishing vessels. They are often old, poorly equipped and always slow – unlikely to give either our maritime patrols or the Indians much of a run for their money. It is unlikely that any of the boats intercepted on our side of the line had anything as sophisticated as a GPS system that would tell them where they were on the face of the ocean or where the invisible line was. The first they would have known that they were in trouble would have been when our patrols hove into view and ordered them to stop. There does not appear to be any suggestion that these men are spies or infiltrators, they are what they say they are – fisherfolk in the wrong place. They are eventually released in batches after years behind bars and drift back from whence they came. This is perhaps one area where we can bring common sense and the humanitarian imperative into play. Should we detain them? Yes – they crossed the line. But should we detain them for years on end? No. Their motives and status can be quickly determined and once established they should be sent on their way.








The brave Radio Khyber FM station based in the town of Jamrud has made history by employing three women as journalists, to present its chatty mix of news and infotainment. This in itself constitutes a revolution in the tribal areas where women lead restricted lives. The space available to them had in many ways diminished under the Taliban, who of course ruthlessly used illegal radio stations to drive home their message. Ironically, one of their prime targets was women within homes. Accounts now emerging from Swat speak of the fact that a big proportion of donations collected by Maulana Fazlullah indeed came from the ordinary women of Swat.

Radio Khyber, set up with a licence and backing from the authorities, does not on the surface pursue a radical agenda. Indeed, it is acutely conscious of the potential risk its women employees face and attempts to ensure their safety by keeping them well away from any programmes that could be construed as calling for women's rights or raising other issues. Taking part in such programmes could mean death for the women. But despite this, the presence of the women on air marks a huge stride forward. The music programmes and other shows they host are reported to be especially popular with other women. The medium of radio of course takes these right into the hearts of homes, allowing them to be heard in kitchens and living rooms. As such there is a possibility that the example set by Radio Khyber will encourage the women of the tribal areas to take up more unusual careers and to provide a voice for those who are themselves hardly ever heard. The irony of their situation is that while they are expected to haul water from wells and undertake equally strenuous physical chores in the fields, they cannot visit a hospital, a market or an office without a male escort. Literacy rates for tribal women too remain the lowest. Maternal mortality figures are in contrast high. Radio Khyber alone may not change this. But it can help alter the mindset in the tribal areas by allowing the voices of women to be heard.








Taxes imposed by governments both provincial and federal are created at parliamentary level – they are imposed by law and have sanctions to back them up for non-payment. But there are other forms of taxation that fall between the cracks, and one of them is the tax being demanded of the residents of the Defence Housing Authority in Karachi for 'refurbishment'. The amount of tax ranges between Rs150 per square yard and Rs1,000 per square yard on residential, amenity, commercial and industrial plots – a not inconsiderable sum. As a consequence, the Defence Society Residents Association has gone to law arguing that the tax being sought by the DHA is essentially a property tax. Property taxes and their formulation are the property of the provincial assembly, but this tax say the residents is being levied via the executive order of an institution – the army – working under the aegis of the federal government.

The DHA is a part of the cantonment area and is therefore under the control of the ministry of defence. The area was originally allocated for the residences of army personnel but is now populated principally by civilians. The civilian residents are living on plots and in houses which they own in law, but pay their local taxes to the army as the area does not come under the jurisdiction of the nazim. The tax that the DHA is seeking, and which has driven the residents to seek the protection of the courts, is to cover the cost of the damage caused by catastrophic rains two years ago which necessitated a rebuilding of the drainage system – which the residents are now arguing is an inadequate provision in the first place, and why should they have to pay for the expensive mistakes of the DHA? Further, the lease deeds which the residents hold do not provide for recovery of extra charges in the name of 'refurbishment'. A 1980 ordinance to enable the DHA to recover charges for services rendered under the rules framed by the authority and approved by the ministry of defence has not been properly implemented. The residents demand transparency . Dirty drains are going to be headline news for months to come.








Cutting deals and making and breaking alliances are part of politics as politicians try to secure the best transaction in a given situation for their parties and constituents. But deal-making for personal vested interest has become the norm in Pakistan in recent years for our rulers and those aspiring to be in power.

Pervez Musharraf, we are told, left Pakistan after a deal worked out by international players. Mushahid Hussain Sayed, the PML-Q secretary general who came close to Musharraf after suffering at his hands following the military coup against the democratically elected Prime inister Nawaz Sharif in October 1999, made it clear that the deal guaranteed protection to the retired general. The so-called "international players," who obviously include Americans, Saudis, the British, the Hariris of Lebanon and the UAE's ruling sheikhs, are happy to guarantee that the military usurper remains unharmed even if he committed treason, not once but twice, under Article 6 of the Constitution. They have no respect for Pakistan's Constitution and laws because we Pakistanis and our institutions don't have any regard for those legal niceties, either.

Musharraf, visibly unfazed in keeping with his stubborn character, also hinted at those deals when he claimed in a recent TV interview that King Abdullah of Saudi Arabia had assured him that PML-N leader Nawaz Sharif won't press for his trial under Article 6. Though the PML-N leadership has issued a denial and the Saudi Arabian authorities, in keeping with their discreet style of working, are keeping quiet, there should be little doubt that the Saudis are once again playing an important role in sweeping vital Pakistani issues under the carpet and averting confrontation between the major political forces in Pakistan. If this wasn't the case, why would Musharraf and then Nawaz Sharif present themselves in the Saudi royal court, showing obeisance as seen on television screens to King Abdullah in a manner that gives one the feeling that they owe everything to the Saudi monarch. As if the American and British meddling in Pakistani affairs wasn't bad enough, we now have to contend with Saudi involvement in Pakistan's politics, not for anything concerning Islamabad's national interest but for the purpose of protecting a former military dictator from accountability or getting a sacked prime minister released from jail and offering him refuge in Saudi Arabia.

If all these countries and their rulers were Pakistan's true friends, they would have advocated the case of the people of Pakistan, instead of those of some powerful individuals, and taken steps to promote respect for the country's laws and institutions. Saving one former ruler and protecting another goes against the interest of the Pakistani people. This creates doubts in the minds of the people about the intentions of those professing to be Pakistan's friends. The Saudis, in particular, appear sincere in wanting to help and stabilise Pakistan and their economic assistance to the country in times of need is no secret. But they need to befriend the people of Pakistan, and not individuals who wronged their nation and now want to escape accountability with help from the generous and forgiving Saudis.

The manner in which Musharraf is putting up his weak case in his media interviews to defend himself against a plethora of charges is provocative, to say the least. He stressed that nobody could touch him because he didn't act alone while taking major decisions such as plotting the 1999 coup, imposing emergency rule on Nov 3, 2007, and ordering the attacks that killed Baloch politician Nawab Akbar Bugti. According to Musharraf, all those who mattered in the Pakistani Army were involved in the coup against the Nawaz Sharif government. His subsequent actions, if one were to believe him, were also taken with the consent of everyone in the armed forces and the government. This is plausible, because in Pakistan there aren't many people who are ready to stand up to their boss and suffer the consequences. Even if most of those in uniform and government weren't consulted, or didn't like the arbitrary and sometimes self-serving actions of the impulsive Gen Musharraf, none had the guts or the conscience to raise objections to his misdeeds, or resign.

To his credit, though, the outspoken Musharraf said a few things recently that again testified to his forthright nature. If by any chance he were tried under Article 6, the retired general would like all the superior court judges who assisted his Nov 3, 2007, actions by consenting to the emergency rule and taking oath under the PCO to be put in the dock with him. Obviously, he doesn't want to go to the gallows alone. There are plenty of people among the judges, politicians and generals who helped him violate the Constitution and other laws of the country and all of them need to be made accountable. This is something that needs to be done if future coup-makers and their supporters and toadies are to be deterred.

Musharraf also conceded that he imposed emergency rule because Chief Justice Iftikhar Muhammad Chaudhry had made up his mind to declare him ineligible for the presidential poll. If he had his way, the chief justice would not have allowed Gen Musharraf to contest the election for president while still in army uniform. Only someone like Musharraf would be willing to admit that he had this ambition to ride roughshod over any legal and constitutional hurdle and re-elect himself as president. And only the irrepressible Musharraf could say even now that he expected justice from Chief Justice Chaudhry in case he had to face the treason trial. Musharraf also was not far from the truth when he insisted that there was no major difference in his policies and those of President Asif Ali Zardari vis-à-vis the United States. If anything, the PPP-led government has become even more vulnerable to Washington's pressure than the Musharraf regime. Another thing that Musharraf conceded, and one felt he should have shown discretion on this issue, was the use of US military supplies against India, even though those arms were meant to be used in the so-called war on terror.

Returning to the issue of the deal-making that plagues Pakistani politics and provides outside powers the chance to dictate decision-making concerning vital issues at the expense of the people of Pakistan, one has to accept this fact of life until the ruling classes learn to live within our means and measures are taken to reclaim our sovereignty. What can one expect from military generals who lied to the nation when the US drones first started attacking targets in Pakistani territories and they were insisting that those missiles were being fired by Pakistan's armed forces? How can one trust JUI-F leader Maulana Fazlur Rahman who kept criticising the Musharraf regime while keeping him in power and is now critical of the PPP government policies but is happy to remain part of the ruling coalition?

How on earth can one repose confidence in the MQM which has been in power five times in the recent past, changing partners as it sees convenient and paying lip-service to democracy while backing every undemocratic step of Gen Musharraf? Is it possible not to be suspicious of the PPP when one after another avoidable crisis is hitting the country and stories of corruption are again making the rounds? Can we believe the PML-N when it says it would make Musharraf accountable and that it is a genuine opposition party while being in power in the country's biggest province as part of some "deal" with the PPP? And what about the ANP that won the 2008 general elections in the NWFP by promising peace and instead delivered war and is now at the centre of never-ending allegations of corruption in the province?


The writer is resident editor of The News in Peshawar. Email: rahim







There's a lot more at play in the Meera circus than just sex, lies and videotape. Meera, while a useful instrument of allegory, is hardly instrumental in any serious discourse about Pakistan. Yet, hordes of sympathetic old men are lined from here to the numerous gates of the walled city of Lahore, each making a valiant attempt to defend the talentless Pakistani Paris Hilton (unless overexposure counts as a talent), from a predatory news media. Oooh.

Meera is a deer in the headlights, of course. Poor thing wouldn't know a "t" from a cross and an "i" from a dot. Meera has broken barriers, rocketed through the glass ceiling and trailblazed a Mallika Sherawat-esque path for future Pakistani vixens largely on the back of naivete and virgin-like innocence. Oooh.

Let us grant the besieged woman her claims of purity. But we cannot grant the woman all of Rome, nor her defenders this place called Pakistan.

Meera's appeal, in a country that is so drearily overburdened by both its Hindu roots and its Muslim canopy, is obvious. Meera will go where few Pakistani women have gone before. Watching the edifice of Meera unravel is temptation too big, and clearly too strong, even in the holy month.

Why can't the entire Meera fiasco be about an opportunistic and talentless actress take it to the next level in her ability to captivate an otherwise uber-righteous nation of saints? It can't because crusty old Pakistan will not cede a single opportunity to mock and malign the news media in this country. Old Pakistan hacks, with pens in one hand and carte blanches for the military and the political elite in the other, are out in full force defending Meera. Unfortunately, it has nothing to do with Meera's virginal innocence. Meera is to be defended because, if she is not, Pakistan's news media will devour her whole.

The full-scale blitzkrieg on the Pakistani media, of course, is not new at all. For months now, owing both to events past and events foreseen, Old Pakistan--a strange cocktail of traditional powerbrokers, scions and members of the political elite, apologists for the military's senseless parades into civilian domains--has sought to de-legitimise the most potent instrument of change available to Pakistan's emerging urban middle class, the news media. Stain the credibility and veracity of the news media, and the entire Pakistani middle class narrative would stand de-legitimised.

The campaign to achieve such an outcome has been long, sustained and brutal. It has of course, had to rely on some truly egregious attempts to stretch the truth and reconstruct reality.

My all-time favourite is the purported media sympathy for terrorism, based on its ideological right-wingedness. Not so long ago, before Pakistan's brave soldiers took on the terrorists in Swat, a sustained campaign by Old Pakistan helped to paint the news media as having a deep and demonic addiction to radicalism, extremism, fundamentalism, obscurantism, sectarianism, and fanaticism. These aren't my "isms." These are some of the isms that were being used liberally by Old Pakistan (about which little but its scruples is liberal). By the spring of this year, the murmurs had reached a crescendo. One rarely had the opportunity to meet a foreign diplomat or donor or aid worker or multinational executive without being asked about the Pakistani media's evil rightwing slant.

Then, all of a sudden, along came May 8, and within days, Pakistanis and non-Pakistanis alike witnessed wall-to-wall coverage of Pakistan's fallen soldiers, wall-to-wall promotions about Pakistan's commitment to beat back terrorism and a whole new kind of anti-terror jingoism that at some level was alarming in its own right. It turns out that Pakistan's news media did not have any right-wing tilt at all. On the contrary, when it came to Pakistan versus terrorism, the news media was instrumental in helping coalesce a major national consensus about the need to take the military fight to the Taliban in Swat, and indeed beyond. The same news media that, in March of 2009, had allegedly demonised the Pakistani military with its fervent support for rule of law and the restoration of the Chief Justice, was, only two months later, in May 2009, helping reconstruct the Pakistani military brand in Pakistan, with its coverage of Swat.

Old Pakistan's obsessive compulsion to discredit the Pakistani news media, of course, isn't restricted to fabrications about its alignment with the wrong kind of politics. One of the most frequent instruments that Old Pakistan relies on, to discredit the news media, is to question its appetite for breaking news. The insinuation is that turning a legitimate profit, one that no newspaper or television news channel has ever denied being interested in, is somehow a disservice to the reporting of news. Fancy, indeed. In a country where the proliferation of illegitimate profits is frequent but its prosecution rare, it's more than a tad ironic that by profiting through its labour, the news media is somehow a villain.

Journalists themselves are a frequent target of Old Pakistan's diehard pursuit of a discredited news media. If a reporter writes something positive about a person or a group of people, he's a paid hack for that entity. If a reporter writes something negative about a person, or a group of people, he's a paid hack for that entity's opponents. No matter what journalists in Pakistan do, the easiest way to discredit them is to malign the motivation for why they are writing.

Luckily, the media is institutionally immune to attacks on its legitimacy. It has self-correcting mechanisms that will enable the articulation of increasingly sharper and more incisive versions of the truth. Those that seek to undermine the free news media in Pakistan don't have any such self-correcting mechanisms. Old Pakistan operates out of an ever-shrinking space of narrow self-interest. That space, like the rural dimensions of this country, is shrinking fast. This is a losing battlefield for the forces of traditional power in Pakistan, and there is no armour that can stave off defeat.

Vociferous defenders of Meera are entitled to be starstruck by the damsel's distress. But their attempts to discredit the news media for following a vacuous story that has commercial appeal are unfailingly linked to the larger project to demonise Pakistan's premier middleclass institution--the Pakistani news media. This is spilt milk. Crying is futile.


The writer advises governments, donors and NGOs on public policy. He can be reached through his website







Pakistan is currently facing multi-dimensional challenges in the areas of politics, economics, security and international relations. It is natural to expect that the government will be spending quality time in addressing these challenges. On the contrary, it is painful to see that the government – both federal and provincial -- is engaged in handling the sugar crisis in the country. Apart from the government, the judiciary has also involved itself in a purely economic issue – fixing the price of sugar. A simple issue of demand and supply has been turned into a monster only because it was mishandled by the people who had little or no idea about sugar trade. It is, therefore, a bad reflection on part of the government. How can one expect it to tackle bigger challenges that the country is currently facing?

What is the crisis all about? The price of sugarcane, the main raw material, accounts for 85 per cent of the total cost of the production of sugar. The total size of the sugarcane crop was 50 million tons in 2008-09 as against a bumper crop of 63.9 million tons in the previous year – almost 14 million tons less. Accordingly, sugar production was expected to be 3.2 million tons as against 4.7 million tons last year – 1.5 million tons less. Pakistan's total consumption was estimated at 4.2 million tons. Hence, the current year's (November 2008 to October 2009) sugar production was expected to be one million tons short of the consumption requirement. However, the country had a carry-over stock of 800,000 tons from the previous year. Therefore, the estimated shortfall for the current year was 200,000 tons. It has, however, been a common practice to begin the new crushing season with a carry-over stock of al least 400,000 tons in order to keep the price of sugar stable. Accordingly, the estimated shortfall was 600,000 tons assuming a carry-over stock of 400,000 tons. This was known to the government during April-May 2008.

Fully aware of the emerging sugar crisis in the country, the Ministry of Industries and Production (MOIP) made several attempts to get the approval of the competent forums for the import of 0.4-0.6 million tons of raw sugar during July-October 2008. Each time the growers' lobby vehemently opposed the proposal and blocked the import of raw sugar – a substitute for sugarcane.

The MOIP made yet another attempt by taking a summary to the ECC, the meeting of which was held on December 30, 2008. The MOIP, once again, came under severe attack by the growers' lobby. The then Advisor to Prime Minister for MOIP joined the bandwagon of the growers' lobby and deserted his own secretary because of this. Thus, the growers' lobby once again blocked the import of raw sugar.

How then did the problem start? At the end of crushing season (April 30, 2009) the total stock of sugar in the country was 2.3 million tons against the consumption requirements of 2.17 million tons (0.31 million tons per month) for May-November 2009 – a tightly balanced situation. This current demand-supply situation makes us think that there will be no carry-over stock for the next season – indeed a highly risky assumption.

The people associated with the sugar industry are smart as they possess enormous information about the availability of sugar within and outside the country. The international sugar market is 18 years tight as India alone wants to import 4.0 million tons sugar this year. The international price of sugar has been ranging between $500-600/tons and the landed cost of it was estimated to be Rs60-65/kg in Karachi.

It is pertinent to point out here that while average retail price of sugar in Pakistan ranged between Rs45.4 – Rs47.2 per kg during May-July 2009, it was hovering around Rs70-75 per kg in Afghanistan. Such a massive price differential (Rs25-28/kg) was enough to encourage the smuggling of sugar to Afghanistan. There is news that smuggling of approximately 3,000 tons/day of sugar was taking place and, so far, 200,000-250,000 tons have already been smuggled to Afghanistan, thereby putting pressure on the domestic price of sugar.

It is a well-known fact that the sugar consumption rises during Ramazan. Therefore, before the beginning of this month, that is, early August, the price of sugar started rising and averaged to Rs52.5/kg from Rs47.2/kg in July. The print and electronic media started highlighting a substantial increase in sugar prices across the country. The government came under pressure and instead of addressing the issue through economic measures, it resorted to a massive crackdown on the sugar industry in the name of hoarding. This was a colossal mistake on the part of the government. As said earlier, sugar crushing season lasts for four months and sugar mills crush millions of tons of sugarcane during this period. They produce 3.2 million tons of sugar in the four months to be consumed over 12 months. Therefore, one can find millions of sugar bags stacked in sugar mills at any point in time. This does not mean that hoarding is taking place. Furthermore, all the stocks of sugar are pledged to banks against borrowing from them.

The crackdown on sugar mills completely disrupted the supply chain and the commodity was not available even in retail shops, thus pushing the sugar price even further up. The manipulation of the price of sugar by the mills cannot be ruled out either. Sugar mills knew the international price of sugar and the would-be landed cost at Karachi and Lahore. Thus, the slower release of sugar from the mills to the market with an objective of continuing to put pressure on domestic prices, and aligning them with the landed cost of imported sugar, appears to have been a rational strategy on the part of mill owners.

It is the government that has to be blamed for mishandling the situation and providing opportunities to be exploited. Firstly, the government did not take the right decision at the right time. Not allowing import of sugar before the beginning of the crushing season was a bad decision. The growers' lobby showed their muscle and thwarted the efforts of MOIP to import raw sugar. Secondly, when the government came under pressure, it reacted irrationally. A simple demand-supply situation was badly handled. The raids on sugar mills disrupted the supply situation and put further pressure on prices.

The current sugar crisis is just a trailer. Next year, the sugarcane crop will be at least five million tons less than this year; the price of sugarcane will be much higher than this year; sugar production will be less than three million tons against the consumption requirement of 4.3 million tons; and the shortage will be in the range of 1.5-1.7 million tons.

We must learn lessons from the current sugar crisis. For one thing, do not allow the growers' lobby to prevail upon economic decisions. Never provide an opportunity to sugar mills to exploit the situation. Don't handle economic issues with administrative power. While fixing the support price of sugarcane for the next season the chief ministers must take into confidence the representatives of sugar mills and the consumers. Large differentials between subsidised and the market price of sugar is bound to breed corruption. Why are you using foreign tax payers' money for such purposes? The Friends of Pakistan have been asking these questions privately. Finally, improve governance, lest we are seen as a nation lurching from one crisis to another.

The writer is dean and professor at NUST Business School in Islamabad. Email:








Thanks to a variety of market distortions, the growers of sugarcane are not adequately rewarded for their contribution. They have weak bargaining power relative to the processors. The entire structure of production and market exchange is tilted against the farmer and creates a systematic tendency to under-price their produce. For instance, there is a regular and systematic attempt by sugar mills to delay the crushing of sugarcane. More specifically, the crushing season starts too late and ends too soon.

The timing of crushing season is inherently political. The delay achieves two benefits for the processor. First, it tends to reduce the water content, thereby increasing the relative sugar content in sugar cane. This results in weight loss. Since the price of sugar cane is linked to its weight, the delay helps depress the price. Second, since farmers tend to operate a rotating crop pattern, they are pressured to switch to the next crop (often, wheat in this case). This can quickly lead to desperate and panic selling, compelling the farmer to sell the sugarcane at lower prices. Additionally, as the crushing season is delayed, supplies of sugarcane tend to peak. This again has the effect of pushing down prices.

A more worrying aspect from the farmer's perspective is that even these lower prices that sugarcane fetches for them is paid back with considerable delay. Farmers have to wait for months before their arrears are cleared. Even today, the mills owe nearly Rs25 billion to growers. It is pertinent to mention here the two other market distortions that tend to discriminate the farmer and work against his interests. These are restrictions on processing and zoning. Farmers are not allowed to process sugar cane at the farm level, which could have cut down costs and introduced greater competition. Even more surprisingly, farmers are also barred from selling sugarcane out of their respective mill zone. Both of these restrictions privilege the mill owners and obstruct free competition.

Despite these glaring distortions, farmers lack any effective voice. They are not allowed to defend their interests by forming unions, which further reduces their bargaining power compared to the considerably more powerful Pakistan Sugar Mills' Association (PSMA). This is one reason why we haven't heard any representative of sugar growers presenting the farmers' perspective in television talk shows. This raw deal for farmers is harmful, not just for growers, but for the rest of the society. It reduces incentives to grow sugarcane, which results in falling production levels and rising prices. Rather than correcting the incentives for domestic farmers, there is a tendency at the official level to favour sugarcane growers of foreign countries by importing raw sugar at higher rates.

The power relations that prevail in sugar markets at the micro level are also reflected in public policy, which tends to better accommodate interests of the influential millers' lobby. Public policy has so far shied away from deep structural reforms that could alter the structure of agrarian incentives and promote greater competition in sugar markets. One would have expected the government to identify and curb collusive and anti-competitive behaviour on the part of sugar mills, and to correct for the array of market failures that beset this industry. It is a testimony to the power of the sugar lobbies that elements responsible for blocking the timely import of sugar have not yet been held accountable.

The focus of official policy has instead been on offering populist, short-term fixes. There is a clear preference for stop-gap arrangements -- subsidised provision of sugar through utility stores and sasta Ramazan bazaars, promises of a higher support price for sugar, and reduction in the GST. The trouble with these measures is that they are all politically neutral, intended to placate public concerns while maintaining status quo. Subsidies and tax reductions impose a significant drain on scarce public resources and ultimately substitute the price problem with a fiscal one. For instance, slashing GST will result in an estimated revenue loss of Rs500 million, which is likely to be covered through future taxes. And given the regressive nature of the tax system, the burden will ultimately fall on the poor.

It is striking that political discourse on the question of sugar has been so sterile. The PPP for its part has singularly failed on its first public test to ensure 'roti, kapra aur makaan'. Apart from a few policy pronouncements and half-hearted measures, the PPP government seems largely unperturbed by the sugar crisis. Shahbaz Sharif's government in Punjab, on the other hand, has displayed a more active concern on this issue. But, here again, we see an attempt by the provincial government to side-step issues of structural reform by focusing exclusively on administrative measures. It is not easy whether one should interpret this as mere political posturing or a desire for deep reform. Only time will tell the difference.

One thing is clear, however. A genuine reform agenda for the sugar industry should bring both economics and politics back into the equation. In particular, the litmus test of future reforms is whether they can rely on economic tools and incentives to promote free and fair competition or fall back on administrative measures. Clearly, the cabinet committee on sugar has a daunting task ahead.

(To be continued)

The writer is an Islamic Centre lecturer in Development Economics at the University of Oxford and a research fellow. Email:







The writer is a former envoy to the US and the UK, and a former editor of The News.

At the recent meeting of his party in Bhurban, former Prime Minister Mian Nawaz Sharif sought to defuse the war of words that had raged for weeks between PML-N spokesmen and those of the ruling party. Tempers flared over so-called revelations by a former chief of the Intelligence Bureau about the role of the spy agencies in distributing cash among politicians in the 1990s. This reignited tensions between the country's two major parties that had all but dissipated since the resolution in March 2009 of the judges' issue and the revocation of governor's rule in Punjab, which restored the PML-N to power in the province.

This blast from the past was halted by Nawaz Sharif at his party convention where he studiously ignored the Imtiaz affair and tempered the rhetoric by changing both the tone and content of his stance towards the government. Disclaiming any interest in destabilizing the government he declared he only wanted to play the role of a "patriotic" opposition. This was not the first time that the party's leadership interceded to de-escalate tensions. Occasional flare-ups are unsurprising between rivals and have little political import. What merits greater attention is how the PML-N is defining its role and charting its future in the country's politics.

The enigma that needs to be unravelled is the party's pronounced reticence to play the role of a vibrant and assertive opposition, staking out clear-cut positions on key issues and providing alternate policy paradigms to differentiate itself from the Pakistan Peoples' Party (PPP). This has important implications for the PML-N's identity and fortunes. Such a role – as a government-in-waiting – should not be confused with confrontational politics or one that aims to unseat the government. Indeed one of the most encouraging aspects of post-2008 era is the effort by political parties to break from the zero-sum politics and adversary culture of the past. Save for the PPP's blunder of March 2009 when its leader imposed – and then was forced to revoke – governor's rule in Punjab, both parties have shown a healthy respect for each other's democratic mandate. But this has little to do with and does not explain why Mr Sharif and his party have chosen to play a less than vigorous role in engaging the government on issues and hold it to account – the job of an effective opposition.

This has set up a paradox: the country's most popular leader, according to opinion polls, is unable or unwilling to wield commensurate political influence to shape the public discourse or reset the policy agenda.

The PML-N's post-election politics has swirled around three issues: restoration of the chief justice, undoing the 17th Amendment and the demand for the trial of former president Pervez Musharraf. In confining itself to these issues it has not directed its energies to other governance and policy issues: of the economy, foreign policy or internal security. Nor has it said very much on the controversies surrounding government projects. The party made no real contribution during the budget debate, said little on how to handle the Mumbai crisis with India, or on addressing the challenge of militancy. This lack of articulation of key issues and policy diffidence has weakened its role as an effective opposition and as an alternate governing party that has its own distinct solutions to address Pakistan's multiple challenges. It also risks conveying an impression of a party with no real direction about where it wants the country to go. Why is this so?

Three kinds of explanations can be offered. First, at a challenging moment for the country when it is faced with a complex array of internal and external problems, the PML-N leader may want to avoid taking unambiguous positions to minimize political risk, leaving it to the government to negotiate these issues and not have to share responsibility. A wait-and-dodge-issues approach is politically expedient because taking positions means expending political capital, which in any case is bound to displease some constituencies.

A second explanation often marshalled out by detractors of the PML-N is that it is trapped in the past and its politics is more about settling scores than meeting future challenges. Mr Sharif has often sought to refute this charge by arguing that cleaning up the past is the basis to building a viable democratic future. However understandable Mr Sharif's sense of aggrievement, this preoccupation has made his party vulnerable to opponents reopening embarrassing aspects of its political past.

A different set of reasons may lie behind the PML-N's less than robust political role. One, its leadership's deep suspicion of the establishment and two, an acknowledgement of its political limitations. The first is self-evident, and is reflected in frequent allusions by its leaders to unspecified conspiracies which they vow never to succumb to. The perception of the establishment as a greater political threat to the PML-N than the PPP seems to have translated into an ultra-cautious, almost passive political approach which has unintendedly undercut its effectiveness. This also explains why the party does not feel bound to engage the government in any rigorous policy debate. Despite having a more media-savvy team, the PML-N has often been driven by TV anchors into taking positions on issues ranging from rental power projects to the US drone attacks.

The second factor may be the leadership's evaluation of the limits of its political power. Mr Sharif's personal popularity doesn't translate into decisive political strength for the party. This is because first, the PML-N remains a Punjab-based party. Second, despite the province's numerical weight in the power equation, an effective national role needs allies from the rest of the country. Today the PML-N is bereft of allies. Instead it has troubled relations with the MQM and the ANP. In contrast the PPP has shown itself adept in working with allies, co-opting groups, sharing power and occupying the political space ceded by the PML-N's go-it-alone approach. The PML-N's political limitations also arise from the fact that the PML-Q's parliamentary party is still a factor: twice the size of the MQM membership in the National Assembly. Its recent splits have yet to erode this parliamentary strength as the breakaway members are all unelected. So the PML-N is unable as yet to match the PPP-led coalition's political reach and power.

This raises important questions for Mr Sharif's party and its political future: about its identity, character, programme, and its relationship with other political parties. As he has often correctly stated, Pakistan's problems are no longer amenable to partisan solutions and need consensus building to fashion national remedies. But are the PML-N's political endeavours focused on creative thinking on issues and forging political relationships on shared policy approaches to practice what it is preaching?

Mr Sharif needs to give his party a fresh vision and challenge the PML-N to think innovatively about how to address the imposing challenges that will determine Pakistan's future. Not to do this could convey an impression that the party's pursuit of power is shorn of public purpose.

The PML-N needs to clarify its ideological centre of gravity in the country's changed circumstances today and also inspire followers beyond its loyal vote bank. Such a process of redefining and reinvigorating itself will renew its image as a party of the future and not just one that aspires to office on the basis of having being wronged in the past.







While Pakistan has taken some meaningful steps to bring the perpetrators of Mumbai terrorist attacks to justice, India is using Afghanistan's territory to launch attacks in Balochistan, leading to balkanise Pakistan even further. In the 1971 war, India discreetly used the unrest in East Pakista to its fullest advantage leading to the creation of Bangladesh on the world map. Today, India is supporting a most difficult drive of using the Baloch insurgency against Pakistan.

Although, it is true that India does not share borders with Balochistan but India cannot remain oblivious to its meddling through hundreds of RAW operatives and Indian regular troops prowling in Afghanistan bordering Balochistan. RAND scholar Christine Fair, a leading American expert on South Asia, disclosed in an objective analysis carried by the American journal Foreign Affairs has validated Pakistan's legitimate claim about India's involvement.

There is a long list of overt as well as covert evidences available with the Pakistan Government about the complicity of few angry tribal chieftains with India in fomenting trouble in Balochistan. The statement of Brahamdagh Bugti, grandson of late Akbar Bugti, was alarming when he revealed that he would accept any "moral help and material support" from India to create mayhem in Balochistan. During an interview on a TV channel telecast on July 4, 2009, the Baloch rebel leader Hyrbiyar Marri revealed that "American enslavement is better than Punjabi enslavement because the Punjabis will come and occupy our lands for good. The Americans will only steal our oil and gas, while Punjabis will obliterate our national identity." There is strong evidence of Indian support in planning, commissioning and preparing acts of terrorism in Balochistan.

This tactical maneuver yielded following multiple anti-Pakistan purposes: (1) Proving Pakistan's security apparatus guilty of killing in the eyes of Baloch people. (2) Thwarting the possibility of reconciliation efforts between the government and the angry nationalist leaders, by killing Ghulam Muhammad Baloch – a man responsible for playing a major role in the release of John Solecki, Chief of the UN Human Rights Commission in Balochistan.

It is true that past governments were responsible for the present situation in Balochistan and India is just exploiting it. Ever since the creation of Pakistan in 1947, the greatest offence of every successive government has been that they have never tried to improve and develop Balochistan. The imbroglio surfaced when the centre launched fast-track development projects aimed to bring the area into socio-economic mainstream. They became an eyesore for Indian strategists who wanted to extent their zone of influence in the central republics.

Some of the grievances projected by Baloch nationalists are: provincial autonomy, detention of political workers, bigger share in NFC, special quota in federal jobs, enhanced royalty for natural gas, increasing military intrusion, gradual attrition of Baloch identity with influx of outsiders, etc.

India is under is undergoing social and economic revolutions that is capturing the best minds – and money – of western business which is decreasing due to constant pressure from an ever-growing population.

The writer is a freelance contributor.








AS people are undergoing tremendous hardships because of shortage and unbridled price hike of essential items and services, Prime Minister Syed Yousuf Raza Gilani has warned the nation to be ready to brace water, power and gas crises. While addressing an Achievement Award distribution ceremony organized by Lahore Chamber of Commerce and Industry he also assured that the Government would do its utmost to resolve them. He, however, conveniently avoided mentioning any details of what more was in store and how he intends to address it.

The warning of the Prime Minister came on the day when a man waiting in queue to get subsidized flour died of heart attack in Gujar Khan. Bisharat Khan, 55, waited for four hours for atta truck, fainted and then passed away. In this backdrop, the statement of the Prime Minister will certainly add to the woes of the people. There are frustrating and humiliating scenes of long queues of atta and sugar seekers, causing immense harm to the fair name of the country. What a Government that cannot ensure availability of even essential items at affordable rates! The Prime Minister never gets tired of getting credit for increasing procurement price of what exorbitantly in just one go without realizing the havoc this decision has played with the poor of the country. His fellow landlords are surely the beneficiary of the unprecedented rise but what about small income groups and daily wage earners who are losing their lives waiting for subsidized atta or wasting their time for the purpose. The Government has also been telling the nation that the menace of load-shedding, which many believe, has artificially been created by commission hungry elements to justify Rental Power Plants, would end by the close of the year but now the Prime Minister warns of worsening of the crisis. It means that the measures that we have been hearing about addressing the crippling energy shortage are mere eye-wash. Similarly, what steps the Government is taking to address the impending shortage of gas and water in the country. By allowing liberal opening of CNG stations in dozens in the same localities, the Government is, in fact, itself trying to compound the gas problem. All this is taking place because of palm-greasing of the concerned officials but the ultimate sufferer is the domestic consumer who gets lowest pressure in winters. One would also ask the Prime Minister as to why his Government has unilaterally abandoned the most viable water reservoir — Kalabagh Dam — when the country was poised for power and water shortage. Under these circumstances, people of Pakistan would be compelled to receive the dreaded statement of the PM as an ‘Eid Gift’. Mr Prime Minister, is this the way you celebrate Eid.







KHADIM-e-Harmain Sharifain King Abdullah bin Abdul Aziz has rendered a sincere advice to PML (N) Quaid Mian Nawaz Sharif to avoid raising controversial issues. During their meeting in Makkah Mukarramah, the King urged his guest to promote reconciliation for continuation of the democratic system in Pakistan.

It was quite obvious that the King was referring to issues that are causing a stir in national politics. These, among others, included demand of the PML (N) for trial of former President Pervez Musharraf under Article-6 of the Constitution. These issues are raising the political temperature at a time when the country badly needs stability to effectively respond to challenges of greater significance. It has repeatedly been emphasized in these columns that the very survival of the country is at stake because of the local and international conspiracies yet one fails to understand why our national leaders have to be reminded time and again by our well-wishers and friends to do this or that. A leader of the stature of Mian Nawaz Sharif, who is perceived to be the most popular and respected figure and whose party is a Government in waiting, is expected to adopt a forward looking approach. This is because the country suffered a lot in 90s due to infighting between PPP and PML and that led to fall of governments. The advice of King Abdullah, who is indeed highly respected personality of the Muslim Ummah and a close friend of Pakistan, is very pertinent because of the ground realities in Pakistan. We, therefore, hope that Mian Nawaz Sharif would pay heed to his counselling and devote his energies to resolution of the problems of the masses.








MINISTRY of Water and Power has done well to clarify that the Government was not pressurising any bank in the public or private sector to fund Rental Power Projects (RPPs) because the issue has become a topic of hot discussion these days in the print and electronic media. Thus it was necessary to remove the doubts being created among the people that certain elements were specifically favouring the commissioning of RPPs.

Taking benefit of the publicity that the RPPs gained in the media certain politicians have joined the fray alleging that there had been kickbacks. Therefore we believe the clarification may be of some assistance to dispel the impression as far as the financing and equity of the RPPs is concerned. We firmly believe that the banking sector must enjoy total freedom of action to finance in projects of their choice, as Pakistan cannot afford to allow the collapse of the financial sector as we have witnessed in the Western countries. However we suggest that more is needed to ensure transparency and good governance as far as the commissioning of the RPPs is concerned so that no one has any doubt that going for the Rental Power was the only option available to overcome the power shortage which was hitting the economy and the common man adversely. On the subject of tariff, we think merely stating that rental plants tariff was slightly different than normal IPPs by giving technical reasons like capacity, return on capital, interest on loans, repayments and other variable cost components would not satisfy the people as the Opposition parties are already out to discredit the Government. Another point being raised is that the RPPs are second hand, consume more fuel and thus the power generated would be a burden and the country may witness another crisis of circular debt. We would therefore suggest that as the new media is playing a robust role and serving as a watchdog, the Ministry of Water and Power should encourage debates so as to clarify each and every objection and no doubt is left over the transparency of the deal.







Arrest of spokesman of the defunct Tehreek-e-Taliban Pakistan (TTP) Muslim Khan along with three other accomplices including commander Mehmood Khan by the security forces is being viewed as a tremendous achievement by all and sundry. Reportedly, both Muslim Khan and Mehmood Khan carried head money of Rs 10 million each. But one high profile reporting editor gave a spin to the whole story even before their arrest was officially announced by the government. He quoted TTP’s spokesman having said that those arrested were members of the delegation sent to hold negotiations with the army. This sounds as travesty of the truth because the TTP would not have risked the arrest or death of their leaders and commanders by making them part of the delegation especially when there was head money on them. A few media men and ‘intellectual lights’ either have soft corner for the militants on the pretext that they are waging jihad against infidels, which is a flawed perception. More likely than not they are sick in mind.

The Inter Services Public Relations (ISPR) has meanwhile strongly denied the report that militants’ leaders were arrested when they had gone to hold dialogue with the law enforcers in Swat on Thursday. The nation is witness to the claims of Muslim Khan who is on record having accepted the responsibility for most terrorist acts carried out in Swat by calling the local journalists on phone, included burning of schools, attacks on security forces and killing government officials mostly policemen. However, a small number of misguided elements wittingly or unwittingly support the militants that raise the banner of Islam to kill their Muslim brothers thus playing in the hands. If uneducated and illiterate militants unfamiliar with the Islamic injunctions and tenets are misled by religious shysters it is understandable, but when educated people support the elements involved in heinous acts of killing their Muslim brethren, destroying schools and mosques, it is simply unimaginable. After Tehrik Nifaz Shariat-e-Muhammadi (TNSM) leader Maulana Sufi Muhammad violated the agreement he had signed with the NWFP government and rejected the Constitution and denigrated Supreme Court and high courts of Pakistan, the government decided to start action against them. Now, when the militants have been defeated and are on the run, no sane person would suggest holding negotiations with the militants. According to the report under reference, Taliban spokesman Salman said: “He was given an impression by Commander Mehmud Khan that the military authorities were putting pressure on them to surrender the Taliban commanders who refused to abide by the terms of the previous peace accords and continued to use force against the security forces and political opponents.” But this is a blatant lie because it was in fact on the basis of Muslim Khan’s ‘claims’ that the government had placed head money on him. The TTP spokesman is further reported to have said: “We sincerely entered the peace negotiations with the army but it seems this was a trap. Maulana Fazlullah had conveyed a message that arresting Taliban peace negotiators was a breach of trust”. No one with an average common sense would buy in this logic that the TTP would send the ‘most wanted’ members of shura to hold negotiations with the government. For a moment let us presume that it was so, the action of arresting the militants’ leaders was a step in the right direction. When the TTP leaders do not honour their commitments and pledges then the government and armed forces are also not under obligation to give militants a chance to reorganize to play with the lives of people of Swat and Malakand Division. The government under no circumstances should provide any opportunity to the militants and must take the operation to the logical conclusion. The government needs to stop the supply of weapons to the militants from across the border. A few months ago, India’s pernicious designs to destabilize Pakistan were exposed by one of the most prestigious US journals “Foreign Affairs”, which wrote that India had been pumping huge amount of money to create unrest in Balochistan and that it has direct links with terrorists’ activities in Pakistan. The journal published by the Council for Foreign Relations from Washington has impeccable evidence gathered by an eminent US journalist Christine Fair by visiting Iran and Afghanistan. The journalist who is a senior political scientist at the Rand Corporation disclosed that “the Indian missions are undertaking the job ‘beyond issuance of visas”. But Indian leadership should realize that god forbid Pakistan is destabilized, India would also be on the road to its perdition, as it has all the ingredients of disintegration.

The prodigious achievement of our armed forces is that they have almost cleared and recovered the area where militants, terrorists and thugs aided and abetted by foreign intelligence agencies that had complete control in the area. There is no doubt that Pakistan’s security forces are one of the best in the world, and what they have achieved within a short span of time, the US, NATO and Afghan forces have not been able to achieve during the last eight years, which is reflective of their professionalism and dedication. Anyhow the fight is not yet over and the terrorists who ran away from the area would try to hide in some other areas, and the government would have to watch their movements so that they do not gang up again to repeat the sad saga. It is true that military operation in Swat and Malakand Division has been successful and armed forces have done a superb job of rehabilitating the internally displaced persons within a couple of months. Nevertheless, the government and the armed forces have to keep a strict vigil over enemies’ agencies. The government should also highlight the foreign agencies involvement in acts of terrorism in Pakistan and convince international community to help wean them away from machinations to destabilize Pakistan. Unless the fountainhead of terrorism in Afghanistan is closed, Pakistan would continue facing the spectre of terrorism, as Pakistan’s enemies will find another Baitullah Mehsud or Fazlullah to the detriment of Pakistan. In this connection, Pakistan government should not feel shy in exposing those involved in conspiracies against Pakistan. It is heartening to note that President Zardari, Foreign Minister Shah Mehmood Qureshi and Rehman Malik have started playing on the front foot.

There has been a lot of propaganda against Pakistan accusing it for its links with Al Qaeda and the Taliban. The July/August 2009 issue of ‘The National Interest’, had carried an essay by Bruce Reidel, a former CIA officer, titled ‘Armageddon in Islamabad”. He wrote: “A jihadist victory in Pakistan, meaning the takeover of the nation by a militant Sunni movement led by the Taliban, would have devastating consequences. Pakistan as an Islamic-extremist safe haven would bolster Al Qaeda’s capabilities tenfold…The jihadist threat bred in Afghanistan would be a cakewalk in comparison…The threat would be almost unfathomable. The implications would be literally felt around the globe. American options for dealing with such a state would be limited and costly”. Such statements from former CIA officials and think tanks appear to be in line with the previous US administration and now Obama administration.

However, the US should understand that destabilization of Pakistan on the basis of ruses and conjectures would have a devastating effect on the region and the world at large.







Learning from others experiences differentiates a man from an animal. Human beings unlike animals learn from experiences of others. Instead of supporting or criticizing the policy, I am going to rake through 200 years of (general) education in America and Britain to help politicians, planners and professionals determine a course that serves youth rather than chasing a wish-list mirage leading to nowhere.

According to the results of triennial Program for International Student Assessment (PISA) Survey Report 2006 organized by Economic Co-operation and Development on Science scale out of 57 states UK was 21st and USA 36th (P-22). In Reading UK was 17th and US is not reflected (P-34). In mathematics, UK is 24th and USA 35th (P-47). PISA tested more than four lac 15-year-old students from 57 countries including 44 advanced states and leading world economy states to evaluate student competencies for tomorrow’s world. The data covers student, family and institutional factors that could help to explain differences in performance. In the OECD 2004 report, USA was 24th and UK withdrew its students.

Finland leads the OECD 2006 and 2004 reports. It shows there is more to good education standards than fat budgets and adopting foreign education models. The school education authorities in UK and US allegedly lowered exams standards to show improvement. The test results from the US National Assessment of Educational Progress, finds that American 12th graders are actually performing worse in reading than 12th graders did in 1992, when a comparable exam was given. A NY Times Editorial Public vs. Private Schools dated July 19, 2006 debunked the widely held belief that public schools were inferior to their private and religious counterparts. On average, American schoolchildren are performing at mediocre levels in reading, math and science. It shows that privatization is not the answer to raise education standards; poor education standards are not only there in public sector and nationalized education as part of “big governments lead to serfdom and poverty”. Islamabad should seriously consider keeping education in public sector including nationalization of private schools. Take a stand against Reaganism presumption that if the government does it, it’s bad. The Danish model school plan should be reviewed because IMF thinks that it is too costly for developing economies and needs longer duration to deliver.

Advanced Placement Tests offered in American schools to help students do better in colleges are leaving minority students behind (The NY Times 7 Feb.2007). In UK, it is opined lack of social mobility is a serious threat for poor students. The average US wages have decreased from $37,000 to $32,000 (adjusted after inflation) in last fifty years. Pakistan’s 90 percent population living below one dollar a day (against government’s conservative claims of 35 percent) should be reason enough to offer free education up to the university level. College education costs are too high in UK and US. Ninety percent of Pakistani students cannot self-finance college education. Therefore, state has to uphold its responsibility. The quality of education is contested vigorously resulting in life and death difference for a student from public education institution vs. elite private institution. The calls for education watchdog in UK are case in point. Pakistan education policy needs to address education standardization issue at school, college and university level to replace public private sector rift in current system with healthy competition and save students from taking more than one test to enter professional colleges. At school level, US has National Assessment of Education Progress, at college level entry exams like SAT, MCAT and for medical education at national level, it has National Board of Medical Examiners.

American model of education administration developed over two centuries offers important lessons. The option of Inter-Provincial Education Ministers Forum should be scrapped and provinces should be allowed to retain control of education policy as part of provincial subject right up to university level. It will keep federation out of provincial public service commissions, avert getting bogged down in revision of national language policy and avoid further increase under the head of federal education administration expenditure. Instead, Islamabad should do away with higher education ministry, federal ministry for education and restore federal education liaison officer of grade 19 to coordinate education matters with and between provinces. The huge budgetary allocations for federal education setup be allocated to provinces and allocate 3 percent instead of one percent yearly increase to reach 7 percent of GDP. In America, the students and professionals who want to study or work within states pass state board exams and those who want to follow federal government or overseas route have to clear national board exams. The state boards and national boards on case-to-case basis get national and or international accreditations. It relieves federal government from maintaining and financing large bureaucratic setup, avoid curriculum and text board controversies, and maintain quality of education standards at international level. The boards self-finance themselves through minimal fees and other charges. Government regulates these institutions to keep the exam evaluation fees at reasonable rates. This system absolves individual education institutions to strive for national and international accreditation because the state or national board with which it is affliated acquires it. The results determine the standard of teaching. It will allow the government to do away with inspection setups and the funds can be allocated for pure education. The professionals of state and national boards devise the curriculum and textbooks are printed by the private sector accordingly. On average, the books of major state and national boards are revised after five years. The online availability of United States Medical License Examination contents not only facilitate students, publishers and employers but also allow international medical graduates (IMGs) to take the exam. Each year some 21,000 thousand doctors enter US job market including 9000 IMGs.

Interestingly doctors studying in state medical schools across America can take USMLE Step 1 and 2 after passing third and final year exams respectively. In addition, American medical student can pass be a MD in eight years in which five years are spent on medical education and depending on the specialty three-five years for the residency training. The state and federal jobs are given through Electronic Residency Application Services and National Residency Match Program. These services charge $90 and $60 respectively for matching the scores of the applicant with the job requirements.

Finally, education policies are made to support domestic needs and with entrenched poverty nationalization is need of the hour. Education policies must be indigenous and philosophy driven. Malaysia has stopped teaching mathematics and science in English. Pakistan is an agribased economy; its curriculum should proportionately focus on dairy, agribased skills more than industry, finance or English. Therefore, for delivering at grassroots, provinces not federation should control education policy.







The Indian Government has protested against renaming the Northern Areas as Gilgit-Baltistan and according of internal autonomy to it by the government of Pakistan recently and also objected to the construction of Boonji Dam. The Indian demarche is ostensibly based on their self-contrived premise that Kashmir is an integral part of India, therefore, Pakistan could not change the status of the areas comprising the State of Jammu and Kashmir. The government of Pakistan has done well and is fully justified in rejecting the Indian claims. The entire world knows and acknowledges the status of Kashmir as a disputed territory. President Obama and the European countries have repeatedly shown their concern on the continued hostility between Pakistan and India over Kashmir and underlined the need to resolve it. Not only that there are numerous UN resolution calling for settlement of the dispute through a UN sponsored plebiscite and numerous unequivocal commitments of Nehru to resolve the Kashmir tangle in accordance with the UN resolutions.

It would perhaps not be out of place to look at the Indian stance about Kashmir being an integral part of India in its historic perspective to put the record straight. It is now an established fact that despite the existence of UN resolutions and commitments by Nehru, the Indian leadership was never serious in holding a plebiscite in Kashmir and was always looking for excuses to circumvent the UN resolutions and resile from its stated position. So they found a solution which they thought would provide them an opportunity to wriggle out of their international obligations on Kashmir. They had a resolution passed by the assembly of Occupied Kashmir in 1957 endorsing accession of Kashmir to India and then started claiming that by virtue of this resolution Kashmir had become integral part of India. The move, however, was not only summarily dismissed by the UN but was also rejected by the world community and Pakistan. The UN categorically said that the question of the accession could not be settled by any means other than provided in the UN resolutions on the subject. The disputed status of Kashmir has also been acknowledged by India itself in Clause 6 of the Simla Agreement (signed in 1972) which underlines the need to resolve all disputes between the two states , including Kashmir through peaceful means.

The Indian objection to the construction of Boonji Dam in Azad Kashmir by Pakistan is also ridiculous in the backdrop of the construction of Baglihar Dam by India in the Occupied Kashmir and plans to construct a number of other Dams in violation of the Indus Basin Treaty . As is evident from the foregoing , the Indian demarche regarding these issues contradicts its own international commitments and is devoid of any legitimacy. The situation arising out of Indian protest fully vindicates the government stance to give full internal autonomy to Gilgit-Baltistan , instead of according provincial status to the Northern Areas. The new arrangement in fact has all the attributes of a province and yet has saved Pakistan from the diplomatic embarrassment that would have accrued due to such an unimaginable action. It has a governor, a Chief Minister , legislative assembly and a Council . The establishment of an independent election commission , Public Service Commission and the creation of the post of an Auditor General are other measures which will ensure political and administrative independence of the area and will go a long way in resolving the hardships hitherto faced by the residents of Gilgit-Baltistan. Though late in coming , but it is undoubtedly a great quantum jump to self-governance. The government fully deserves the credit for this very positive approach and it would be unfair not to acknowledge it.There can be differences of opinion on the modalities to go about the business within the new political and administrative structure erected by the government—which is an essential ingredient of a democratic entity— but the new policy initiative cannot be challenged conceptually. It is a very sordid aspect of our politics that the opposition no matter which party it is and how loud it cries for its democratic credentials, considers its prime responsibility to discredit anything associated with the government .

The sole purpose of this exercise is point scoring rather than presenting an objective evaluation of those steps . The white paper issued by PMLQ on the package announced by the government is a classic example of this traditional mind-set . One of the major observations made in the statement of indictment was that since Gilgit-Baltistan was already part of Pakistan , giving provincial status to the area would have been no problem. This is a complete misrepresentation of the facts . The area is part of disputed Jammu and Kashmir whose accession is yet to be decided . How could Pakistan commit the folly of giving it a provincial status under these circumstances ? That would have certainly jeopardized and compromised our position on the Kashmir issue. Further if the PMLQ really believes in what it has said in the White paper , then why did it not do the same when their government formulated a policy on governing the Northern Areas in 2007 ? Who and what stopped them from taking the plunge ? It is quite obvious that they knew it fully well that it was not possible. The question is why is it then demanding from the PPP government what it could not do itself despite being in a position to do so?

Same is the attitude of certain intellectuals and a section of the media who also prefer to look askance at every move made by the government , not out of any conviction but because criticizing is the most easiest of the jobs. There are still others who like to see things through the prism of their own biases and political affiliations and therefore refuse to accept and acknowledge the virtues of the measures coming from across the political divide. Difference of opinion and free debate in the media are the hall marks of any democratic dispensation but that is contingent upon objectivity and respect for the truth. It should not be used as a license to distort the facts and mislead the masses.







Recently, Indian Home Minister Palaniappan Chidambaram admitted, “For Many years we did not assess the Left Wing extremism challenge correctly. I think we underestimated the challenge”. This statement indicates that up till now India has not taken the Naxal problem seriously and consequently has not done anything sincerely to curb that menace. This is not the first time that such a statement regarding Naxal problem comes from the Indian government, Prime Minister Manmohan Singh himself declared the Naxal problem graver than Kashmir and Northeast insurgency.

What is new is the confession that Indian establishment underestimated the challenge and took it as a law and order problem and then tried to counter it through force. Force is not a solution to any problem. Some times using force becomes counter-productive and enhances any movement. Same thing happened in the case of Naxal violence. Instead of looking into the reasons and factors which brewed Naxalism, every Indian government took it as a rebel movement and tried to curb it through force. As violence begets violence, use of force against Naxals increased the gravity of situation. Ever since 2005, India has been witness to an average of 1,500 incidents of Naxal violence, resulting in the death of over 750 people i.e. five incidents of Naxal violence every day and sixty killings every month. Naxal movement is gaining momentum with the passing time. It has spread to both urban and rural areas, ranging 160 districts of India. Indian Home Minister wants to raise 26,000 men to curb the Naxal violence. It is quite surprising that no other way except force is foreseen by Indian administration. Naxal movement is a result of failure of governance.

According to ShankkerAiyar, “Each of the 80 worst Naxal affected districts have no schools, poor heath care, exploitative feudalism, no employment opportunities, pathetic social infrastructure”. Over three lakh villages have no road connectivity. For example Dantewada district of Chhattisgarh is on the list of 100 worst districts list for the past two decades. So despite well aware of the reasons that are behind the rise of Naxalism Indian government is only depending upon force to end that problem. It is paying no heed to the problems that gave rise to Naxalism. In fact in the mind of Indian administration Naxalism is a war that has to be tackled through force. It most of the time forgot that Naxals are alienated Indian citizens and once their grievances will overcome Naxal movement will come to an end. The question that arises is why the Naxals have been able to extend their area of influence over the years to become a serious threat to the country’s internal security. This is due to different factors. The failure of the administration to make sure that the benefits of development percolate down to the common man, especially tribals is a main factor. The Naxal infested states have large tribal populations with poor infrastructure. Corruption, displacement due to large scale projects, inability to avail of benefits from mining of mineral resources, and exploitation by local officials add to increased resentment and increased reception to Naxal ideology. Another thing is that Naxals have become more organized rather than a scattered force. Naxals in India model themselves on the Indian army, from training manuals to undercover training.

The manuals translated into Hindi from Telugu by the security forces give a chilling insight into People’s Liberation Guerilla Army (PLGA) planning military skills and motives. This is very similar to the training of a Jawan or even a JCO. The PLGA’s basic military courses begin with handling automatic weapons, compass and map reading, defensive and attack formations. The manual analyses Naxal operations since 1997 and suggests means to increase enemy casualty.


It discusses how to collect intelligence, stalk the enemy, and lay an ambush and attack. It also instructs how to retreat when attacked, regroup later using coded communication and how to raid protection installations. The fighting forces of Naxals are divided into three categories. The primary force is of extremely well trained personnel who spearhead any attack with superior weapons. The secondary force forms the bulk of a large group with less sophisticated weapons. Finally, the people’s militia comprising farmers, labourers and others. Naxals have over 80 training camps, each training between 200 to 300 people at any point of time. There are 84 training camps which are operating in several states such as Bihar, Chhattisgarh, Andhra Pradesh, Orissa and Jharkhand.

In practicality the Indian government is tackling the issue as a law and order problem. As the Naxal issue is deeply rooted in the social and economic disparities in the remote and tribal areas so using force is only aggravating the problem. These areas are deprived of fruits of development which the rest of India is enjoying. So the sentiments of these people are hurt as they see others enjoying the luxuries of life and they deprived of basic necessities. In such circumstances supporting Naxals is far better option for them. 200 districts out of 600 are under Naxalite rule.

They rule there because the people in these places support them in a majority and believe in them; because the Naxalites give them food, money and land snatched from the rich land owners and exploiters. Naxlites do kill when these rich protest; and at times are involved in atrocities as well. But on the whole, they are the only revolutionary group in this country at the centre of whose agenda are the poor and deprived. Their methods may involve violence, but then worldwide, all uprisings and revolutions have been violent. To the people against whom they fight are villains and terrorists but the people for whom they fight are the heroes.

The foot soldiers of the movement believe that the Naxalite movement will bring about development and prosperity. So the government can reduce people’s appeal for the movement by providing opportunities to the people of Naxal belt through sound economic and infrastructural development programmes. The 2006 status report on Naxalism made it clear that the government should address the problem in a holistic manner. That include “political security, development and public perception management fronts” A lot many measures need to be taken to make the fight against Naxalism effective.







“..Gujarat corps killed Mumbra girl in cold blood, finds probe…” Times of India Sept 8th Five years ago when I first saw those sad pictures of Ishrat Jahan lying on the road, killed by policemen, I asked myself; whether we as a people had become so hardened not to see in that still stretched out form; someone’s little daughter?

Nineteen years old! Think about it; a college going girl, maybe shy, giggly, pretty, maybe conscious of her good looks, yet handling the lewd stares of ogling men and touching perverts everyday to college, just another girl, on her way to becoming a woman but not yet there, keeping thoughts of marriage and children away as with classmates she ‘bunks’ boring lectures and finds a movie more welcome.

Nineteen years old! Someone’s lil’ daughter! Have we become so cold and callous that there was narry a squeak of a national protest that such child was killed? Killed by brutal policeman who did such acts just to please a man whose reputation for allowing the same isn’t too far behind. Just imagine your daughter or mine, going for a picnic, and I’m sure they do, unless you’re the type who keeps them locked at home, which maybe isn’t too bad an idea considering that gun toting policemen are out to shoot them, so let’s suppose your daughter or mine was off for a picnic and we hear a few hours later that they were not only shot dead but were terrorists.

And lets also suppose you were not even from the minority community and you shout out, “My name is Kapoor!” or Pillai and the cops laugh and chuckle or do what whatever cops do when they hear a joke and reply, ‘He’s no more a Kapoor or Pillai, when he became a terrorist he changed it to Abdul or Mohammed!”

That’s how far the cops have gone! And for months or years you’ll see a lone father or mother running from court to police station trying to convince inspector and judge that it is not so. This is happening throughout the country!

For the policeman it is easier to pick up innocent children and put them in jail then to go in search of the real terrorist, and it is time you and I woke up to this. What do we do? Raise your voice today against the death of this beautiful, innocent lil’ girl, start raising questions when you hear about someone being arrested with even a little doubt about their innocence. Open your eyes stop being blind to such acts of sheer savage brutality. If you don’t: The next killing could again be someone’s lil’ daughter and that someone, horror of horrors, could be you..!











It is feared that the huge rush of people to their village homes and other holiday destinations during the Eid vacation will expose more people to the H1N1 virus, commonly known as swine flu, and spread it to the countryside where it may be even more difficult to track and treat. The government, itself, has expressed concern that such large concentrations of people will increase the risk of other people being infected. As the virus is carried by air, one single swine flu victim, detected or undetected, can pollute the immediate surroundings if no protective measure is taken; and if the number in the vicinity is large the chances of contamination will increase proportionately.

The responsibility of the government, however, can hardly be limited to speculations and analysis. Government should act, and act decisively, not merely analyse. The government functionaries should rise to the occasion and address the problem in a convincing manner. There is no room for complacency. It does not help when the government only confirms the death of a swine flu victim a week after the incident. This kind of communication may lead to all sorts of speculation and rumours, even panic - exactly what the government needs to avoid.
The government both needs to be transparent and be at its best. Underplaying the number of mortalities, the government can hardly succeed with their low-profile awareness programmes. Certainly by performing all that is needful the government can generate the hope that reassures.








Over the course of millennia, the Ganges and its tributaries have formed one of the largest flood plains in the world and the Ganges Basin River system remains the main source of freshwater for half the population of India and Bangladesh and nearly the entire population of Nepal. But the Basin is highly dependent on what happens in the Himalayas as the Himalayan glaciers feed seven of Asia's biggest rivers: the Ganges, Indus, Brahmaputra, Mekong, Thanlwin, formerly known as the Salween, Yangtze and Yellow.


In India, the Gangotri glacier, which supports one of India's largest river basins, is receding at an average rate of 76 feet per year and flows have already decreased in three of Nepal's snow-fed rivers; the situation calls for our immediate attention. But obviously, no country in the region can manage a pending disaster of this magnitude alone; hence, the call by the Food and Disaster Management Minister, Dr Abdur Razzaque to manage it at both the macro and micro levels.

Regional and seasonal availability and the quality of surface and groundwater are all important for us, as they depend on the upstream flow.  In other words, the melting glaciers must be viewed with alarm, especially considering the number of dams being built upstream. Once these dams are in place Bangladesh will be subjected to the same kind of problems that are making their appearance in the lower Mekong Basin. 

The linkage of population and water is particularly strong in Bangladesh. And since the balance of environmental factors is extremely delicate and complicated, even a small change in one factor will affect all the others. Moreover, as Bangladesh is downstream, we are vulnerable to the water quality and quantity that flows from upstream. All the major rivers that flow through Bangladesh have their origins outside its borders, therefore anything that happens in the upper riparian regions affect the system of wetlands which cover almost 50 per cent of our total land surface. So there is simply no alternative for us but to harness regional and international support.







She was six, little, and part of a group who were singing Quawali songs, on communal brotherhood. An orphan, I was told, part of a home run by a charitable institution. I watched her bright eyes, oh how they twinkled, growing serious when the words needed such expression and shining with happiness when the words talked of unity and love.

The other little boys and girls in the group had mothers and fathers in the audience, who smiled and waved and cheered and their children's eyes sparkled as they sang a little louder or smiled a little broader seeing their parents wave or shout or clap.

But the little orphan girl had no one. Yet I saw joy in her eyes, gay abandon as she threw herself into the dance, I saw her body move with the rhythm of the music and her wide mouth delivering lines which I wondered her little self understood, and as I looked around I saw that others like me where mesmerised by her. Slowly parents stopped looking at their own and looked at this little mite, who had no one in the audience but who now had all eyes on her. And I thought of some woman somewhere in the country who should have been in the audience to proudly shout, "That's my girl!"

"That's my girl, yes the one with the bright eyes, the one you are looking at, that's my girl, the one who smiles as she sings, who's step and gait you so keenly watch, that's my girl!" But she had no one to say these words. How, I wondered had she come to the orphanage; some unwanted pregnancy? Maybe thrown in the gutter when the whole family wanted a boy! But dear mother who gave her up, if you could see her now, you would have cried out with pride, "That's my girl!"

And the audience would have looked at you with envy, "What a daughter you have?" they would have said silently, "How beautifully she dances!"

"She's only six!"

"She's going to be somebody someday!"

But now the chances of her being somebody someday from an orphanage are dim, dear woman, very dim. She's six and not adapted yet, and will stay the rest of her growing life in the confines of a home for others like her.
And slowly as the years go by, as warden and superintendent enforce rules and cruelty wrapped as discipline on her, those eyes will sparkle less, that smile will fade and she will become another faceless woman married off to some faceless man, who one night will look at her, after she has cleaned his place and his plates and that of his mother and father and her children, "Why do you look so wistful?"

And she will turn those same eyes I saw this morning on him and whisper, "I wonder what life would have been if I'd had a mother?"     









IT was not the end of capitalism, not the end of the free market and not the 1930s-style Great Depression so many predicted. But the collapse of Lehman Brothers a year ago today was a deeply traumatic moment that marked the end of the debt markets as we knew them. It exposed the deep flaws in the financial system and brought the excesses of the credit markets to book. The recovery still has a long way to go, but so far the responses of governments, the G20 and financial institutions show some lessons have been learnt. Bankers and investors alike are wiser and more alert to the risks that complex financial engineering involve.


Heavier regulation in itself is not the answer. Instead, the global financial crisis has reminded us that those who stand to profit from risk must also own it. At its heart, this was a crisis of debt instruments that became so complicated even many of the bankers were unable to explain them. Long before it erupted, it was apparent to those with clear heads that the system had run out of control. Highly leveraged hedge funds were investing in unstable derivatives, which repackaged and resold debt for quick profits, diluting and spreading risk and obscuring where it ultimately resided. Much of the risk, as many institutions and individuals learned painfully, rested in sub-prime loans to low-income households in the US, whose capacity to repay the loans was severely limited. Investors now appreciate more than ever the importance of investing in real businesses rather than dubious on-paper products promising high returns - but backed with few, if any, real assets.


Fortunately Australia's well-regulated banking sector had little exposure to sub-prime loans. But Reserve Bank governor Glenn Stevens recognised wider dangers in 2006 when he warned that hedge funds were taking advantage of "a vast array of financial products, 24-hour trading and ample liquidity to expose the funds of sophisticated investors to virtually any conceivable type of risk". On the back of sub-prime assets, the US debt bubble had expanded on an unprecedented influx of Chinese money as China's export-led growth built up its foreign reserves to the point that it overtook Japan as the US's biggest creditor, holding $US653 billion in US Treasury bonds last year.


The crisis has reminded us that the real purpose of the stock market is not to operate as a quasi-casino for offshore pension funds, but as a vehicle for raising capital for productive enterprises. Too often, in the lead-up to the GFC, successful companies posting healthy profit increases above inflation found their share prices marked down sharply by markets influenced by powerful institutions. The funds' rapacious demands for unrealistic profits exacerbated remuneration systems geared to short-term returns, linking executive bonuses to end-of-year performance instead of long-term results.


As the GFC unfolded, it was clear inadequate monitoring of financial services, especially in the US and Britain, had to be addressed, unlike the 1987 crash in which weak auditing processes were a problem. Regulation of the global hedge funds emerged as a priority, given that some rivalled small nations in their economic power. This was evident in last year's manipulation of oil prices by fund managers, who disrupted economies by stockpiling oil and driving prices to $US147 a barrel.


In April, the G20 summit pledged to improve monitoring to make financial systems more disciplined and transparent. When billions of dollars can be moved between countries at the click of a mouse, authorities recognised they needed to catch up with innovation. The G20 finance ministers agreed to improve accounting standards and extend regulatory oversight to the credit rating agencies. The process will continue when the G20 leaders meet in Pittsburgh next week, but will be constrained by the limited progress in the US, where much financial regulation legislation is yet to be introduced. However, Barack Obama has made progress in putting the market to work to help deal with the toxic debt that threatened to paralyse economies.


Taxpayers in many countries will continue feeling the impact of the crisis, and the debt that has been used to soften the downturn will have to be repaid. A year ago, the demise of Lehman Brothers was a shock, but in allowing the bank to collapse rather than bailing it out, the US Federal Reserve at last forced Wall Street and the global markets to own their mistakes. Future boom markets will inevitably also over-reach and be corrected. But capitalism, contrary to the predictions of some doomsayers a year ago, is proving its resilience by emerging stronger and more responsive to the needs of the real economy.








WE could not agree more with Tony Maher, the president of one of Australia's most powerful unions, that there are jobs and then there are real jobs. The boss of the Construction Forestry Mining and Energy Union is right when he says "green jobs" is a "dopey term" that goes down badly with his members.


Ridiculing green jobs puts Mr Maher in direct conflict with ACTU president Sharan Burrow, who has been talking up the so-called new economy this year as part of her alliance with green groups such as the Australian Conservation Foundation. But Mr Maher's comments will reassure his members, many on salaries of more than $120,000, who are not much interested in putative jobs installing pink batts.


His words will ring true also for other workers, who are beginning to see through the jobs jargon from the Rudd government. Just weeks ago, Kevin Rudd told the ALP national conference he would create 50,000 new green jobs and training opportunities, only to be contradicted by Employment Minister Mark Arbib, who had trouble separating jobs from work experience. The fumble over the $94million program left green jobs looking like flakey, make-work positions, not the skilled jobs for the brave new world of a transformed economy.


Then there is Canberra's funding of a green car exercise, which turns out to involve assisting Ford to develop a new four-cylinder engine for its Falcon and Territory. Such lazy labelling of programs does nothing to convince Australians about the jobs transition implied in the government's carbon reduction plans. It's not an easy sell. As Mr Maher suggests, his miners do not see themselves heading into low-paid jobs in the new economy, thank you very much. This is the real point of his foray into the semantics of green. We need a realistic presentation of a low-carbon economy. It's fine to talk about green jobs but coal remains central to the economy, with or without a Carbon Pollution Reduction Scheme.


Mr Maher has been closely involved in the union movement's strategy to address climate change and cannot be dismissed as part of the dinosaur end of the labour market. He sits on the ACTU climate change group and in the past has joined conservationists to back calls for jobs in areas such as renewable energy, bio-materials and recycling - in short for "green" jobs. As he told ABC radio last year, "to think that people don't care for the environment just because they have heavy industry jobs is a lot of rubbish".


But we could do with a reality check as the world wrestles with cutting carbon emissions. As Australia's most valuable export, coal brought in almost $55 billion last financial year and production will increase by almost one-third over the next five years. We agree with Mr Maher that coal and steel will continue to be important parts of the Australian economy. We need serious investment in clean coal technology, not simplistic ideas about closing mines. Coal may be a problem but it must also be part of the solution.


Mr Maher is disingenuous, however, when he assumes high wages will continue for his members. Coal will be heavily taxed under a CPRS and the industry will find it hard to attract investment, even if it gets the compensation it seeks. In short, a lower-carbon economy changes the ground rules, even for a powerful union such as the CFMEU. Mr Maher's open mind on the green economy should be matched by similar flexibility on the labour market.







YOU need to go back to the early 1980s to find an incident as bad for tennis as the outburst by Serena Williams in the US Open semi-finals. Williams lost her cool, and the match, proving that anything John McEnroe could do, girls can do better.


Check out the incident, for which Williams incurred a point penalty at 15-40 to lose the deciding game, on the internet and decide for yourself whether she really threatened to kill the official who gave her a foot fault on her first serve. But be in no doubt: the world's No2 women's player deserved to be penalised. She was not just out of line on the day but out of touch with a game where the metronomic Roger Federer rather than the obstreperous McEnroe is the norm.












KEVIN RUDD and his ministers assure us they don't want to play politics. They just want to get on with the job of reforming, if not ''revolutionising'', the country. Heaven forbid that they are preparing the ground for an early election while the opinion polls are so good, and while Malcolm Turnbull looks like Popeye being beaten to a pulp by Bluto before the spinach can rolls into his grasp.


Why then are even junior ministers like Nicola Roxon so freely throwing the threat of double dissolution around? Ms Roxon raised the prospect because the Senate has rejected the Government's bill that would roll back the private health insurance rebate for those on moderately high incomes and raise the Medicare levy surcharge. That would be in addition to the looming trigger in the once-rejected climate change legislation.


But it's empty talk. It quickly became apparent that recalling the Senate in three months' time, just before Christmas, would also require the majority vote that the Government lacks in the upper house. And anyway, what then? An election in January or February? Thanks Kevin, would be the grim reaction of most people: all this for a measure that doesn't come in until the next fiscal year, starting in July?


Government ministers would be better to work on persuading public opinion what is at stake in issues like health reform rather than scoring points against a divided Opposition. As a Productivity Commission report on hospitals is due at the end of the year, why not wait until politicians and the public have a better grasp of the problems in the system and the options for fixing them?


They might also consider that early elections bring forward the moment when a government no longer looks new and refreshing, just familiar faces in their second term with not much to show for their big talk. Thanks to their state colleagues, Labor might lose four or five seats in NSW.


An election could be the fire that hardens the Coalition leadership, or allows a more effective one to spring up. Remember that Gough Whitlam's victory over Billy Snedden in 1974 was followed by his own downfall only 18 months later.








MALCOLM TURNBULL ought to have a lot going for him. He is confident, an excellent speaker, able at his best to turn a mediocre case into a devastating one. His personal story is of modest origins and success through intelligence, hard work and good fortune. If it does not reflect the experience of most people, at least they may perhaps respect it, and some may even aspire to something like it.


But with the abundant confidence comes his much remarked upon lack of judgment, shown devastatingly in the

matter of the Prime Minister's ute. There is no need to rehash all that; it is enough to note that Turnbull's ratings have still not recovered.


As a politician, Turnbull is a gambler. With the ute affair, he staked a fortune on one throw of the dice and lost it all. He has gambled similarly on the stimulus. When the Opposition announced it would reject the Rudd Government's large stimulus packages, he said that the position would not be popular. It isn't. More than half the respondents in yesterday's Herald poll believe stimulus spending should either continue or be increased. But popular or not, Turnbull may yet be proved right. If the economy continues to recover, the stimulus will have to be wound back, and in coming years it may appear, as Turnbull and the Opposition keep repeating, an excessive burden for future taxpayers. May appear. Or may not. Though the world economy appears to be emerging from the slump, there are reasons yet to fear that when the effects of China's stimulus end, the continuing underperformance of other economies, including the United States, Japan and much of Europe, will bring back the downturn and need for the stimulus, as the Rudd Government maintains.


Leadership of the Opposition is a fiendishly difficult role, particularly when facing a popular Government. It took the most successful Liberal leader of recent times, John Howard, more than a decade to persuade his party, and then Australian voters, that his easy and instinctive appeal to the comfortable, conservative middle ground was worth supporting. For better or worse, Turnbull is no Howard. He lacks the solidity of Howard's modest and predictable small-business upbringing - a set of attitudes with which Liberals and their fellow-travellers are entirely familiar.


Turnbull has yet to work out how to have the same effect - winning over the centre - from an entirely different starting point, from somewhere flashier yet apparently less substantial, from Wentworth, not Bennelong. Voters sense the Opposition Leader believes firmly in the future of Malcolm Turnbull, but beyond that things start to become vague.


Until he finds a replacement for the Howard formula, the problem remains: after a year of Turnbull as Leader of the Opposition, Australians are none the wiser about what a Turnbull government might stand for.







WHEN Barack Obama took office as US President, it was apparent that changing the occupant of the Oval Office would change many things about America. And in the past year that expectation has been confirmed in speech and deed: a new attitude towards the Islamic world and new strategies for peace in the Middle East; new energy policies linked to measures aimed at reviving the ailing US economy; and now the attempt to deliver health insurance cover to all Americans, an issue that was central to Mr Obama's presidential campaign.


The President has spent much of the northern summer renewing that campaign in town hall meetings across the US, and last week it was the subject of his address to Congress. The speech was another oratorical triumph for a man whose career has had many. It signalled both the resolve of the Obama Administration that a goal that has eluded many presidents in the past 100 years will finally be achieved, and set out basic principles that all but the most conservative members of Congress could accept. Yet it is not only for these things that it is remembered.


It is a tradition that presidents addressing Congress are heard in respectful silence, even by their fiercest political opponents. The office, which combines the roles of head of state and head of government, has an aura that the Australian prime ministership does not. No one heckles a president. Or at least no one did until last week, when a Republican congressman from South Carolina, Joe Wilson, yelled out ''You lie!'' during Mr Obama's speech.


Nor is this the only novelty the President has had to endure since he began urging legislators to deliver on health care reform. Outside many of the town hall meetings he has attended have been protesters carrying guns. In the US, the right to bear arms is, of course, constitutionally entrenched. But until Mr Obama took office it was not typically a right flaunted as a tactic by those seeking to protest publicly against a president's policies. The gun-toting protesters are overwhelmingly from the lunar right of the US political spectrum, as their banners and placards calling the President a socialist, a Communist or a Nazi, or comparing him with Hitler, Mao, or Che Guevara testify. But the prospect that 46 million uninsured Americans might finally gain health cover, contested issue though it be, is surely not their whole, or even their chief, motivation.


Some of the town hall protesters have waved signs proclaiming ''It is time to water the tree of liberty'', a slogan evoking the words of Thomas Jefferson, ''The tree of liberty must be refreshed from time to time with the blood of patriots and tyrants''. The implied threat in the slogan, like the disrespect for the presidency shown by Congressman Wilson, suggests that some things about US political culture have not been changed by Mr Obama's election. On the contrary, it is the fact of his election that explains what is happening: it is inconceivable that a white president would be treated in this way. The protesters are effectively saying that they do not accept the legitimacy of last November's election, when Mr Obama won clear majorities in both the popular vote and the Electoral College.


In the course of his campaigns for the Democratic nomination and then for the presidency, Mr Obama was noted for his coolness, not only in demeanour but by his adroit use of patience as a tactic. He would wait for his rivals to stumble, then make a speech in which he not only declared where he stood but appealed to his opponents to join him in transcending their differences. It was a style of politics, epitomised in the slogan ''Yes, we can!'', that strove for transformation, not short-term fixes.


That style gained Mr Obama his historic election victory, but it may be doubted whether it will serve him best now. Those who do not accept the legitimacy of his election are not going to come on side, and the challenge facing the President is to assert the authority he holds by right of office, and implement the policies declared in his campaign. The election result was not contested: Mr Obama is indisputably the President of the United States. Those who have chosen to use health care reform to implicitly deny his authority, however, are a rump. They do not represent the American mainstream, however much they purport to speak for it. If they nonetheless block the President's agenda, American democracy will be the loser.

 The Age







ANOTHER weekend, another series of violent, alcohol-fuelled attacks: little wonder Victoria's new police Deputy Commissioner has spoken out about what must be done to make the CBD safe again. Sir Ken Jones, with 37 years' international experience, brings a fresh, outsider's approach - including a refusal to let the sensitivities of politicians, planners and businesses stop him from saying what must be said. His insights offer a refreshing example of the sort of community leadership needed to bring about social change.


While the Government has frozen new liquor licences in Melbourne until 2011, that does not alter the status quo, which is unacceptable. The Deputy Commissioner says planners made a mistake in allowing ''vertical drinking spaces'' to dominate the CBD. The civilising balance of entertainment and dining venues has been lost. He knows of nowhere else in the world with such a concentration of nightclubs and bars selling alcohol to hundreds of thousands of young people. ''There can be only one outcome and we are seeing it,'' he says. Those profiting from this social disaster - club owners, operators and the liquor industry - need to be made accountable and even shamed, as Sir Ken suggests. Politicians and planners must restore a healthier mix of venues and tighten regulation of licensing and security - too many bouncers still favour old-fashioned force. Nor are the rest of us off the hook: parents and role models have to set better examples to change youth attitudes and behaviour.


Law and order will be an election issue next year, but Sir Ken warns against reducing it to a police resources debate: ''Those who clamour for more and more police allow others to shirk their responsibilities.'' This is a critical point. Everyone must take their share of responsibility for overcoming the challenging social problems of alcohol and violence.

The Age










It must be tough to follow the Proms. After playing host to premier-leaguers such as Daniel Barenboim, the Royal Albert Hall will end this week with the decidedly lower-division delights of Michael Ball. No such comedowns on Radio 3, where Proms broadcasts are deftly substituted with Night Waves, the arts and ideas radio discussion, which starts again tonight. A speech-programme bubble on a largely classical-music station, Night Waves is that rare thing: a produced discussion that feels like a conversation. Perhaps this is down to the presenters: Philip Dodd, with his reliably piquant questioning, Matthew Sweet's way with a gag or Isabel Hilton's journalistic engagement (one could go through the roster). Perhaps it is the late slot or the presence on Radio 3, which allows for a greater discursiveness. But it must owe something, too, to the producers who put together a nightly magazine both topical and happily off-kilter. This means long discussions of what effect a new age of austerity will have on culture (rather than just the cultural industries) or extended interviews with the likes of James Lovelock. It also means a genuine cosmopolitanism, where Waltz with Bashir is reviewed by a Syrian, a Delhite and a Muscovite and where  Kenan  Malik  and Rana Mitter will bring their own cultural interests to bear on interviews. Most pleasing of all, there is less evidence of the public-relations treadmill where an author is interviewed only to plug their latest offering. Clunkiness is not the Night Waves way.







Taking tough action that purports to protect children has long been thought a political trump card, something no would-be statesman can afford to oppose, whether the action in question is effective or not. It is thus both remarkable and welcome that, after days of bad publicity, the children's secretary Ed Balls yesterday agreed to review the details of the government's clunking fist of a scheme to vet those who volunteer or work with children.


The new system of blackballing went through parliament by acclamation three years ago, as MPs moved to show a response to the terrible though unusual murder of two children in Soham in 2002. But after a weekend of excited stories about hearsay evidence being deployed against Brown Owls and providers of lifts, Mr Balls yesterday signalled in a letter to the chair of the children's select committee that he was asking the bureaucrat in charge of implementing the scheme to look again at exactly who it should cover. While commendable, it is highly doubful that this move will address everything that is awry with the plan.


There are two basic concerns. First, it will do little to make children safer. The chief lesson of the Soham case – where the murderer Ian Huntley managed to become a school caretaker despite past suspicions about him from a police force in another part of the country – was the importance of local police computer systems talking to one another, rather than the need for a new database. And as Baby P's death has underlined, the chief danger to children most often comes from within the home, not from service staff or volunteers. Secondly, the vetting scheme – under which local newspaper stories might be counted as evidence and which provides for only limited appeal rights – is part of a pattern. Like Asbos and the defeated plan for 42 days of pre-trial detention, it extends the power of public authorities to make punishing decisions without the need to sustain allegations to the criminal standard of proof in a court of law. (Any claim that being barred from volunteering does not amount to punishment would wear pretty thin when faced with telling fellow-parents in a lift-sharing club that one was dropping out because of unfounded paedophilia allegations).


Assuming innocence until guilt is proven means running all sorts of risks, sometimes terrible ones, but it is a cherished principle nonetheless. Casting a pall of suspicion on those wanting to work or volunteer with children warps relationships while deterring community-minded behaviour and affording little protection. Perhaps Mr Balls's concession yesterday is a sign that the public has at long last woken up to this reality







The old declension of politics ran something like this: I invest, he spends, they cut. Peter Mandelson adjusted his grammar yesterday, switching tenses. His version now flows: I will reform, we will target, they will slash and burn the welfare state.His speech to the London School of Economics was a well-argued attempt to shape  Labour   ' s message for the next election. He set out a dividing line that made sense and needled the opposition with some sharp truths. He built upon the chancellor's warnings about the need for spending restraint, made in last week's Callaghan lecture. He buried Gordon Brown's pre-summer rhetoric about the choice between investment and cuts (although took the reinvention too far, claiming on Radio 4 that Mr Brown had never used such words, only to be proved wrong immediately after by the BBC's Nick Robinson).


But all this will only amount to something if the prime minister starts saying the same sort of things. The test comes today. When Mr Brown gets up to address the TUC, will he revert to an older political language, resistant to any suggestion that the money is running out or that the state needs to change its ways? If he does, all Lord Mandelson's clever phrases will have been wasted.


The pre-election political season has kicked off with at least half a victory for the Conservatives: government ministers have been pulled onto what was formerly opposition territory, discussing the need to reduce the budget deficit and, by implication, rein in spending. As Lord Mandelson said yesterday, that "means a responsible plan for paying down debt without eating into the fabric of people's lives". "We must constantly rethink the role of the state in delivering our social objectives in new times," he added – words that could have come from Tory lips. All this will go down badly with the TUC, and unions such as Unite, which yesterday denounced the government's health care plans as "a Trojan Horse that could lead to the fragmentation of the NHS". But it may reassure voters that Labour is aware of the world in which it lives and is ready to respond. It also strengthens Lord Mandelson's charge against the opposition, which is that while Labour can reform the state without hurting the people who depend on it, the Conservatives just want to make the state smaller and cheaper, while the consequences for the poor can go hang. This is a caricature of the opposition, of course, but there is enough truth in it for the claim to stick.


It throws up challenges for the government, however. The old battle of investment versus cuts had the merit of simplicity. The new battle boils down to a choice between nice Labour cuts at some undefined point in the future against nasty Tory ones now. If voters are in the mood for cuts, they may simply decide to go for full-blooded Tory ones. But more importantly, if Labour is to fight the next election as a party of public sector reform – "effective state social democrats, not big state social democrats," as Lord Mandelson put it – the party had better hurry up and decide what those reforms involve. The business secretary made a decent effort yesterday to sketch out a programme, drawing on his own department to back targeted benefits and co-payments for services. But it was telling that two other examples he mentioned, trust hospitals and academy schools, were both introduced before Mr Brown became prime minister, and indeed opposed by him. If Labour is, as Lord Mandelson says, an "insurgent" force fighting the status quo, it has kept the urge well hidden.


Labour enters the autumn with a strategy. It has found some strong lines to use against the Conservatives. Its line on spending may resemble the prayer of the priest in the late night bar – oh Lord, make me pure, but not yet – but it is economically credible. If the party sticks to the script, the polls could begin to turn.








There is concern that Japanese children generally are not as interested in science as they used to be. Although the government has adopted countermeasures, it seems that they are not producing the desired effect.


In March 2007, fourth graders and middle school second-year students in Japan sat mathematics and science tests as part of the Trends in International Mathematics and Science Study conducted by the Amsterdam-based International Association for the Evaluation of Educational Achievement. In each category, the average test score of Japanese students was either third, fourth or fifth highest of any nation. Japanese students' average scores were also slightly better than in the previous TIMSS, held in 2003.


But in a survey conducted in conjunction with the tests, only 59 percent of the Japanese middle school students said studying science was interesting, compared with the international average of 78 percent. Only 40 percent found mathematics interesting, against the international average of 67 percent.


The education ministry in early August made public a comprehensive strategy to strengthen abilities in basic science. The ministry says Japan won't have a future unless the scientific abilities of its youth exceed the international average, and warns that Japan lacks a sense of crisis in this area.


The strategy calls for drastic reform of graduate schools, world-class research centers, and improved education in mathematics and science from elementary school through university. Eye-catching projects include enhancing training for science teachers and having universities establish a professional development system for current teachers.


But the program appears to be oriented toward how to feed scientific knowledge to children. Why not also let children experience the joy of science? The ministry should develop a system that encourages children to ask questions and try to solve problems themselves, by conducting experiments, making calculations and writing reports about their trials and errors. The foundation of such a system should be to give teachers more freedom to develop courses that nurture scholastic curiosity.









The Democratic Party of Japan-led administration, to be launched shortly, should do whatever it can to improve the employment situation, as both regular and irregular workers are suffering. Government efforts would help put the Japanese economy on a path to recovery.


In July, Japan's unemployment rate climbed to an all-time high of 5.7 percent (seasonally adjusted). The ratio of job openings to job applicants slipped to an all-time low of 0.42. Especially worrisome is the high unemployment rate among young people — 9.9 percent for those aged 15 to 24 and 7.1 percent for 25- to 34-year-olds (not adjusted seasonally). The number of unemployed people shot up by 1.03 million from a year earlier to 3.59 million. Many of the unemployed had been in such industries as car and electronic appliance manufacturing, which underpin the Japanese economy.


In the short run, the new administration should improve social safety nets for the jobless. It should immediately introduce a program — promised by the DPJ in its election manifesto — of offering ¥100,000 a month to job seekers who undergo vocational training. To avoid skills mismatches in the labor market, it will be necessary to find out what kinds of jobs are most needed by enterprises and how to improve vocational training courses.


As a long-term measure, the new administration should help nurture industries where demand for labor is strong and economic growth is expected. This would help create new jobs. Listening to the opinions of industries and labor unions will be helpful in implementing policies. One hopeful area is industries related to social welfare and child-rearing support. As the population grays, labor shortages in nursing care services are a serious concern. Better working conditions in this field are urgently needed.


Agriculture is another hopeful area. Barriers to new entrants are being lowered. The new administration should seek to develop new forms of agriculture. A renewed agricultural sector producing high-value products, combined with tourism possibilities, could contribute substantially to the revival of local economies.










LOS ANGELES, LOS ANGELES TIMES — Is Wal-Mart turning blue — blue enough to pull President Barack Obama's health care chestnuts out of the fire?


If the nation's largest employer is signing on to the president's agenda, his efforts to pass health care reform will have won an important ally. The company employs 1.4 million "associates," has stores in more than 400 congressional districts and maintains a powerful lobbying operation in Washington.


For years, Wal-Mart has been a poster child for low wages, skimpy health insurance and conservative red-state values. Just a year ago, Wal-Mart managers organized meetings in hundreds of stores to warn employees that if the Democrats won the White House, the company would face a disruptive unionization campaign.


But now, Wal-Mart supports a key, controversial plank in the health insurance reform plan: an employer mandate that would require big companies to "pay or play" — either offer their workers an insurance plan or require a company to pay as much as $750 a year per employee to the government for coverage.


This "pay or play" plan puts Wal-Mart on the side of the unions and liberals and has evoked a virtual declaration of war from the National Retail Federation, whose officers reported themselves "astonished" at what they considered Wal-Mart's "catastrophic" endorsement of a government mandate that most retailers — once including Wal-Mart — have long considered anathema.


So why Wal-Mart's big switch?


Critics have pounded Wal-Mart for years for its violation of the country's labor laws, for its low wages and for its failure to offer a health insurance plan that more than half of its employees would actually purchase. During the presidential campaign, Obama told a cheering union audience that, "The battle to engage Wal-Mart and force them to examine their own corporate values and . . . policies . . . is absolutely vital."


Criticism of this sort has had a real effect on the company's fortunes. One of its own surveys found that almost 10 percent of people polled refused to shop there for essentially political reasons, and the company has been stymied in its effort to put a new generation of "supercenters" in coastal California, in Chicago and in liberal cities such as Boston, Washington and New York. Two years ago, Wal-Mart slashed the number of store openings in the U.S. by one-third. Its stock price has been flat for almost a decade.


And then the new administration came to power, with Obama appointing Hilda Solis, a genuine labor liberal, to be secretary of Labor. Solis would soon declare that "there's a new sheriff in town" when it came to stepped-up enforcement of the nation's labor laws. Wal-Mart knew it would be a prime target, so in late December 2008 it announced that it was resolving 63 lawsuits in 42 states to settle accusations that it forced employees to skip lunch breaks, work off the clock and sidestep overtime laws. The cost: somewhere between $352 million and $640 million.


The company has made the same kind of calculation when it comes to health insurance, not only to forestall bad press but because an employer mandate actually saves the company money when compared with the more conservative, small-government scheme being put together by the Senate Finance Committee. Without a fixed employer mandate, individual companies would be expected to shoulder part of the cost of the federal subsidy that each of their low-income employees would need to afford the coverage they would be required to buy. Because Wal-Mart, which still has most of its stores in the South and Midwest, has a lot of workers who come from poor families, the company would have to pay hundreds of millions of dollars to offset those government payments.


The Senate Finance Committee plan is a contraption sure to generate endless conflict and dispute over both the size of the employee subsidy and the company payment. Indeed, it makes it likely that many companies will discriminate against potential employees who happen to have a lot of kids or come from poor neighborhoods.


So Wal-Mart has put aside founder Sam Walton's disdain for any new government regulation and the ideologically motivated hostility of the rest of the retail industry. An employer mandate is a cheaper, simpler and more universal way to cover those workers who cannot now afford health insurance.


Here is an instance where we can hope that Wal-Mart throws around a bit of its legendary political and economic influence, especially with all those Blue Dog Democrats who hail from the red-state districts where its stores are clustered so thickly.


Nelson Lichtenstein, a history professor at the University of California, Santa Barbara, is author of "The Retail Revolution: How Wal-Mart Created a Brave New World of Business."








GUATEMALA CITY — Japanese voters have rejected the one-party state under the Liberal Democratic Party (LDP), which has supplied most of Japan's government leaders since the party's founding in 1955. (Only in 1993 had an opposition coalition ousted the LDP, for a short time, by holding onto a majority in the Lower House.)


After nearly two decades of poor policy choices that kept the economy in a deflationary funk, the LDP, led by Prime Minister Taro Aso, has been swept from power. As with the election of U.S. President Barack Obama, youthful exuberance overcame a moribund political party full of dinosaurs tone-deaf to demands for change.


The scale of the victory by the Democratic Party of Japan (DPJ) under leader Yukio Hatoyama was impressive — with the DPJ capturing 308 of 480 seats in the Lower House. The LDP now has only 119 seats, down from 300. Unfortunately, the DPJ victory may be simply a case of Tweedledee replacing Tweedledum.


Platform promises and political realities make it likely that substantive changes will be few. For the domestic economy, it may be a matter of jumping out of the fire but into the frying pan.


Indeed, the best hope for real change is in foreign affairs — to the extent that Japan's volte-face emboldens citizens living under autocracy in Burma, China, North Korea or even Singapore to seek democratic change in their own countries.


Still, similarities in the DPJ's and LDP's approach to political governance suggest that changes will be symbolic

rather than substantive.


The LDP had overseen an "iron triangle" of political operatives, bureaucrats and big business under a form of Confucian corporatism that exploited consumers. Now, the DPJ promises an "iron rice bowl" of increased welfare spending that requires a different form of coerced redistribution. Either way, certain groups get privileges or benefits at the expense of others.


As with the LDP, higher spending by the DPJ will clobber future taxpayers already burdened with repaying and servicing public-sector debt approaching 200 percent of GDP, despite DPJ's promises to move away from export-led development toward the promotion of consumer interests.


Under LDP rule, the Bank of Japan (BOJ) implemented "window guidance" whereby selected industries received low-interest loans. This meant that other industries had little, if any, access to funds, even as banks offered few consumer services and low interest rates to depositors. Despite successful picks of "winners" among businesses to receive special treatment, there were many more "losers" among the public at large.


Interventions in money markets to weaken the yen led to expensive imports and cheap exports. Imagine running a household by insisting on paying your neighbors more for their products while having them pay you less for yours!


Of course, the DPJ was correct to reject the LDPs export-led, neo- Mercantilism that imitated the 18th century economic doctrine that spawned European imperialism. Its modern incarnation led to high consumer prices and low payoffs on household saving deposits. Then there was the habit of retired bureaucrats going to work for the very corporations that they once regulated, raising questions about conflict of interest.


Another reason to end dependence on exports as the basis of economic growth is that the apparent success with this model was a combination of happenstance and circumstance. In the first place, Japan's ability to export was based upon its privileged access to uncontested markets in mature economies of North America and Western Europe.


This openness reflected realities of the Cold War in which Japan's economic strength, as an offset to China, served the strategic interests of Western powers. Initially, Japan's export volume was small and of low quality so that there was little domestic opposition from trade unions and producers in receiving countries. This changed. Now many countries have entered the fray in fierce competition, often with the same type of goods offered by Japan's producers. With the pace of technological or regulatory change quickening, comparative advantage can disappear in the blink of an eye.


Unfortunately, the DPJ does not seem to have a vision of how to sort out Japan's position in the world of meta-competition. Instead of seeking to remove rigidities in the domestic economy, the DPJ promises to boost domestic demand with a stronger social safety net and employment provisions. Pushing businesses to raise wages and hire fewer temporary workers will lead to lower profits, stifling much-needed investment.


Furthermore, promises of more child subsidies, free secondary schools and guaranteed minimum pensions have been made without clear explanations of how to pay for them. Fulfilling all or any of these promises will raise government spending and add to the massive public-sector debt, the highest proportion of any industrialized country.


Even the DPJ's most encouraging platform plank promises with one hand and takes away with the other. The promise to "promote" a free-trade agreement with the United States was tempered by the fear of losing votes of domestic farmers. In turn, the party has promised to ensure food safety, promote domestic farming and boost food self-sufficiency. But if these are used as excuses to block trade in agriculture, food prices will rise unnecessarily and harm consumers.

On balance, DPJ policy preferences are unlikely to promote the sort of human and physical capital accumulation needed for vibrant economic growth. As such, the most likely outcome of the dramatic electoral upheaval in Japan is an economy that will remain in the doldrums for many more years to come.


Christopher Lingle is a research scholar at the Center for Civil Society in New Delhi and Visiting Professor of Economics at the Universidad Francisco Marroquin in Guatemala.









In coming days, Jakarta’s streets will be more quiet, and will likely last for about two weeks starting from now, as millions of Jakartans abandon the city for a while to celebrate the Idul Fitri holidays, expected to fall on Sept. 20 and 21.


The Jakarta administration says about 3.25 million of the capital’s 8.3 million residents will take part in the mudik (exodus) – a slight increase from 3.09 million last year.


There are always gigantic human movements throughout the country during Idul Fitri, as millions of Muslims join the exodus back to their kampungs or hometowns. No matter how expensive or how tiring the journey they have to endure, the call of the annual mudik is too tempting to resist. Many regard it as a chance to recharge their spirits by returning to the basics for at least a while. And it is also an opportunity to “show off” their economic success in the cities or abroad. For the poor, their income of the past year is often spent just on the annual tradition.


The Idul Fitri exodus is not a direct teaching from Islam, although it has become a longstanding tradition for Indonesian Muslims and will likely still be maintained by the majority of Muslims trying to get together with their relatives and old friends as well as trying to get back to their roots.


The mudik tradition is not uniquely Indonesian. It also happens in other countries. Millions of Chinese return their hometowns or the mainland to celebrate the Lunar New Year; Americans do the same during Thanksgiving, and Filipino migrant workers also make the exodus back to their home country or towns for Christmas.


We wish all those going on the mudik a nice trip, with the hope that this time their trips will be smoother than in previous years. These are usually still marred by transportation shortages and traffic congestions along the roads to their destinations. Although the exodus happens every year, it is still an extraordinary event because it deals with the movement of millions of people, and usually peaks a week before and after Idul Fitri.


We really hope the government has already learned from all constraints in previous years in facilitating travelers, particularly in preparing adequate transportation, which was previously a major problem during the giant movement of the people.


Learning from previous years, traffic jams will still be the major problem during the peak season. Therefore, apart from providing travelers with smoother roads, the relevant authorities need to install additional traffic signs, including to guide motorists to alternative roads to avoid overcrowded ones.


We also appreciate the police’s plan to escort travelers going by motorcycle, whose number, according to the Jakarta Police, will reach up to 3.5 million from Jakarta and its satellite cities of Bogor, Depok, Bekasi and Tangerang as they head to other cities in Java and Sumatra. The safety of two-wheeled vehicles needs serious attention, because they are at most risk from traffic accidents.


We also hope that all travelers will abide by all traffic regulations for the sake of their own safety and that of other road users. During previous events, dozens of people were killed in traffic accidents, while most travelers were tired due to the long journey.


Have a nice trip!








"Within the framework of the six-party talks" is the big premise Seoul and Washington officials now emphasize about direct dialogue between the United States and North Korea, which seems imminent. Both governments also confirm that any such bilateral contact would be solely directed at the denuclearization of the North, the objective of the multilateral process which started six years ago.


But everyone here and perhaps many in the United States know that Pyongyang wants to hold talks with Washington to have the new Obama administration open its purse in the name of humanitarian and economic aid. Its recent bragging about the capabilities of weaponizing plutonium and enriching uranium was nothing but a gambit to prompt Washington to accept its bid for a two-way conversation.


Through direct dialogue with the United States, the North can avert the cumbersome interference of Japan, perennially clinging to the abduction issue. With China and Russia more sympathetic toward its position, South Korea's objection to a Washington-Pyongyang tete-a-tete can be a major obstruction. Here lies the explanation for the North's recent soft gestures toward the South through the release of a long-detained South Korean worker and the easing of restrictions on cross-border traffic and joint economic projects.


President Lee Myung-bak's recent tilt to the left in domestic socioeconomic policies could be extended to a greater flexibility in his stance on North Korea. His pragmatism may involve the notion that there will be no harm in having the United States in direct contact with the North as long as the "strategic partnership" between Seoul and Washington remains solid.


Around the time of Lee's visit to Washington in June for a summit with Obama, the two governments reached a broad consensus about a "comprehensive package" of incentives for North Korea in exchange for its complete denuclearization. It is an alternative to the "action-for-action" method pursued in the six-party talks which eventually stalled over the verification issue.


The comprehensive package should contain the Lee government's key policy goal on the North. It is the openness of the North Korean economy to cooperation projects with the South and resumption of high-level dialogue between the two Koreas. Parallel inter-Korean dialogue is essential if Seoul is to foot any bills as a result of the contemplated U.S.-North talks.


Previous bilateral talks between the two countries in the early 1990s resulted in major failure, leading to the current nuclear crisis. Seoul spent huge amounts of money for the construction of light-water reactors in the North and the supply of heavy oil to it under a U.S.-North "agreed framework" which was eventually scrapped.


A multilateral process involving neighboring powers was instead tried by a succeeding U.S. administration but the longest international negotiation in modern history is about to give way to a direct dialogue between the two key adversaries. As Washington starts dialogue with Pyongyang for the second time in two decades, its experience of the past failures should be the most important guideline.


Seoul is turning into an onlooker again, but it still has a role to play. It should caution Washington about all possible traps in the negotiations and teach the North through all possible channels of all the good things about a denuclearized Korean Peninsula.









The Korean War left an estimated 10 million people in divided families in the two halves of Korea. Separated at young ages, they are reaching the natural limits of their lives. Of those millions, only 2,000 were lucky enough to be included in the groups of 100 to 200 people exchanged between the two Koreas in intermittent family reunions since the early 1970s.


Again South and North Korea have agreed to hold the family reunion event during this Chuseok holiday in early October at Mt. Geumgang. North Korea limited the number of families to 100 on each side. The South Korean Red Cross society initially selected 300 people out of some 80,000 applicants through a computer lottery and is finalizing a list of 100 which will be sent to the North.


During the past two years, many have died without realizing their lifelong dreams and many others simply gave up hope. The waiting list of refugees from the North at the KNRC needs constant updating because of the deaths.


For the more fortunate people chosen through the extremely narrow competitions, life after the brief reunions was not much better. They are hurt by the changed faces and behavior of their children, brothers and sisters who kept praising General Kim Jong-il for allowing the opportunity, but it is more painful to be parted again, knowing that it would be impossible to see their loved ones again. In summary, 2,000 against 10 million hardly reduces the enormity of the human tragedy on the Korean Peninsula.


When the family reunion project was first discussed in 1972, the North Koreans pressed the South to accept the principle of "free visits" to the other side by the divided families. The propaganda initiative was soon withdrawn and they have insisted on limiting the number to a minimum.


The pattern of the meetings of divided families should now be changed. The present style of "reunions" only adds tribulations of those unfortunate people who have already suffered too much. As a permanent facility for family meetings has been completed in the Mt. Geumgang resort, reunions should be arranged on a routine basis instead of occasional trickle exchanges. Then permanent reuniting of the divided families should be allowed. What political ramifications can there be if 80- or 90-year-olds join their children either in the South or North?








Even though I have spent seven years in Seoul, it is not one of my favorite cities in the world. Actually, until the recent beautification projects, it was one of my least favorite. Seoul has too much concrete, too many people and too little traditional culture has been preserved. Yet, I consider Seoul my second hometown and yearn to be there whenever I am away for very long. It is the Korean people who keep me coming back.


Some of the things I appreciate most about Koreans, such as Korean hospitality, I discovered during my first visit to Seoul in 1987. Others, like "jeong" and "euiri," I am still learning to fully appreciate and often find difficult to explain to non-Koreans.


One of the qualities that define the Korean people is also one of the most complex: jeong. Of the many definitions in my dictionary, "feeling," "compassion," "sentiment," and "affection" seem to come the closest, but none of them convey the real meaning or importance of the term. I see jeong existing between family members and close friends as an invisible force that binds them together. It is difficult for foreigners to "see" this emotion because it is often not verbalized. Westerners regularly tell their loved ones, "I love you," but for Koreans, these words are infrequently spoken.


I first experienced jeong with my wife's family. I was very close to my father-in-law, who passed away in 2002. As someone who fled North Korea during the Korean War, he took great interest in my work on North Korea. He once told me, "Of my six sons-in-law, you are my best hope for visiting my hometown and finding out what happened to my parents and siblings." I still have not had a chance to visit Haeju, but I believe that I will someday. He also taught me that a son-in-law is a "one hundred-year guest." He raised two ornery turkeys during one of my stays in Korea so that the whole family could have a traditional American Thanksgiving dinner.


The second quality I admire in Koreans has been even more difficult to grasp. Euiri can literally be translated as "moral sense," but is better understood as a combination of loyalty and integrity-two qualities often lacking in America's capital. Former President Harry Truman once said, "If you want a friend in Washington, get a dog!" We have had a clear display of euiri in the passing of Presidents Kim Dae-jung and Roh Moo-hyun. The expressions of anguish on the faces of those who worked with and for them tell it all. In contrast, here in the U.S., former Bush administration officials have created a circular firing squad of blame for the Iraq fiasco and even Vice President Cheney has turned on his old boss.


When you combine jeong and euiri and apply them to the three connections that bind Koreans together - namely blood, hometown and school ties - it leads to intense and powerful personal relationships. For non-Koreans, these relationships are impressive to observe, but they do not come without a price - the burden of responsibility and occasionally conflicting moral imperatives. For example, do you help a close friend even if it means breaking the law?


Confucianism has shaped Koreans in many positive ways, but the characteristic I like most is the respect accorded to elders and teachers. If I had to point to the cultural underpinnings of Korea's rapid economic growth, an age-based social order and the centrality of education would be at the top of the list. Teachers have a status in Korea that is unimaginable in most other countries. Of course, attitudes change and a growing number of younger people are challenging the traditional hierarchy, but it is a quality that remains vital. The tension between the traditional and the modern is part of what makes Koreans so fascinating.


One of the Korean qualities that has not changed and I find most endearing is the hospitality and kindness I continually receive from total strangers. I was always getting lost during my first visit to Seoul, but people went out of their way to help me find my destination. Wandering around the countryside, I have been invited to join in 60th birthday celebrations and offered snacks on the hiking trail. Countless people have patiently explained to me the mysteries of Korea's language and culture. How could one not appreciate such a people?


A fifth quality I have both admired and tried to embrace is the Korean proclivity to work hard and play hard. I attribute this to the drive for accomplishment and a general thirst for life. The ability to work a 10- or 12- hour day and then go out eating and drinking is a skill not easily acquired. I know of no other country that offers "three days, no nights" tours, where you depart on a bus in the evening, then hike all day, and return home that night.


The sixth quality I would like to mention is also the most esoteric. During my very first visit to Seoul, even in

the midst of a concrete jungle, I was struck by the beauty of Korea's people. My eyes were the first part of my body to become Korean. We all know that Bae Yong-jun spearheaded the "Korean Wave," and Korea's actresses and models have no rivals in my eyes when it comes to beauty. Many a foreign reporter visiting Pyongyang has commented on the attractive female traffic police. When I exclaimed to several Gaeseong factory workers, "the old saying is really true, 'Southern men, Northern women (nam-nam buk-nyeo),'" I did not receive any response.


Finally, I would be remiss if I did not mention the Korean preoccupation with eating and drinking. One of the first greetings I learned was, "Have you eaten?" and my very first Korean proverb was, "Even Diamond Mountain should be viewed after eating." Eating is of course central to our existence, but Koreans do it with a relish that is almost unrivaled. In Japan, you are never far from a vending machine; in Korea, you are never far from 10 restaurants. I am still amazed when I go into a Korean barbecue restaurant, eat two or three portions of galbi, finish off several side dishes, only to hear the waitress ask, "What would you like for dinner?" (Shiksanunyo?).


Korea has an equally intense drinking culture, which I have also tried to embrace without pickling my liver. I was introduced to this culture during my first summer in Korea in 1988. One of my teachers (Prof. Lee Young-hui) invited me to go hiking in Bukhan-san with several other dissidents (including Baek Nak-chung and Poet Ko Eun). I should have known from the enormous backpacks each was carrying, but on top of the mountain we had a huge meal and rice wine (makkoli)! One of the things that keeps most Koreans (and myself) from becoming an alcoholic is not drinking alone. I like the custom of never pouring for oneself so much that I impose it on non-Korean family and friends.


When I got married, not only did my wife wear a hanbok, but we also followed the Korean custom of having the most prominent social figure in our lives, my graduate school advisor, conduct the ceremony rather than a religious person. A Korean professor attending described our ceremony as "Komerican." I have taught my daughter to be proud that she is both Korean and American. She comes from two great peoples!


Peter M. Beck is the Pantech fellow at Stanford University's Asia-Pacific Research Center. - Ed.








TEL AVIV - No matter how important rising oil powers outside the Middle East are becoming, the region will continue to be the world's main source of energy for years to come. Unlike Russia, the Middle East's OPEC members act as a cartel that produces well under capacity. At current production rates, Russia will be out of the running by 2020. The conditions are not radically different in Africa.


This means that energy security will remain highly dependent on Middle Eastern politics, with the region's oil producers continuing to seek to dictate terms to the world market. Of special concern are the links between military ambitions and the transfer of wealth that oil exports can bring. Iran's nuclear weapons program and Iraq's formidable military buildup of the 1990s exemplify the lethal link between hyper-militarization and energy-market power.


Politically driven threats to oil supplies, as always, dominate energy-security debates. As the Iraqi case shows, wars and domestic upheavals can not only affect the short-term level of oil supplies, but also undermine the long-term productive capacity of a country by hindering maintenance and investment.


Yet, the potential threat to Middle Eastern oil supplies is nonetheless overstated. Against all odds and predictions, regimes in the Middle East have survived both the failures of pan-Arab nationalism and the challenges of Islamic extremism. Nor are the concerns that terrorist attacks can force the oil industry to its knees very plausible. So far, the damage from such attacks has proven to be short-lived.


And the doomsday scenario of an Israeli-Iranian showdown leading to an Iranian blockade of the Straits of Hormuz is not especially credible, either. It is doubtful that Iran has the military capacity to block the straits, and, were it to try, it would confront a truly global coalition in response. Moreover, closing the straits would amount to a self-imposed blockade that would hit Iran's own domestic energy needs hard, owing to its lack of refining capacity.


So, although the mystic power of the oil weapon still prevails, it has proven to be an impotent tool. Some

continue to see oil as "the energy equivalent of nuclear weapons." But the truth is that the 1973 Arab oil embargo was a colossal failure.


Had it been successful, President Anwar Sadat of Egypt would not have rushed to Jerusalem to strike a peace deal with Israel just a few years later. The oil weapon did not force Israel to withdraw to its 1967 borders, nor were the oil powers capable of absorbing for very long the costs to their own economies of the drop in revenues.


A massive use of the oil weapon along the lines of the 1973 oil embargo is out of the question nowadays.


Nevertheless, some people, like former CIA Director James Woolsey, predict that a radical seizure of power in Saudi Arabia might usher in the use of the oil weapon against the West. But to be radical is not tantamount to being irrational, and whatever its religious or political color might be, no Saudi state could forfeit its means to hold the reins of power. The colossal wealth that comes from oil makes producers no less dependent on oil than consumers.


The real threat is not that a radical Saudi Arabia might cease exporting oil, but that it would continue doing so even if the country turned radical. Billions of petrodollars would then become the financial firepower behind global Wahhabi designs.


But is this really a scenario much different from the one we face today? After all, Saudi oil wealth has been underwriting terrorism for quite some time now. Conspicuously, al-Qaeda is happy with Saudi power in the oil markets. In one of its pronouncements, it even admitted that Saudi Arabia "must remain safe because it is the primary source of funds for most Jihad movements."


If energy security means the availability of sufficient supply at affordable prices, then the real security problem comes from market power, from a cartel-based price system that dictates artificially high prices that could never exist in a competitive market.


Indeed, the aspiration to maintain market control explains OPEC's opposition to the Kyoto Protocol, whose implementation might reduce global oil demand by as much as 20 percent, and its fear that the U.S. might follow Europe's example and fight oil addiction by a drastic increase in energy taxes.


President Barack Obama has repeatedly warned that the transfer of wealth to hostile oil producing countries is a major threat to U.S. national security. His plan for a substantial cut in U.S. oil consumption to meet lower carbon emission targets and a ten-year plan to develop clean energy are commendable aspirations. But policies aimed at reducing oil consumption are bound to clash with the urgent need to revive America's economy.


Maintaining stability in the Middle East for the sake of energy security has now become secondary to the pressing need to deal with the challenges posed by the problems in Iran, Iraq, and Afghanistan. But, even if the U.S. managed to reduce oil consumption by as much as 17 percent, it would still have to depend on Gulf oil, and hence on energy security in the region.


Shlomo Ben-Ami, a former Israeli foreign minister, is vice president of the Toledo International Centre for Peace and the author of "Scars of War, Wounds of Peace: The Israeli-Arab Tragedy." - Ed.


(Project Syndicate)









As the new school term begins, campuses have turned out to be the most vulnerable link in the nation's defense against the A (H1N1) influenza. In spite of high-profile pre-school screening, schools continue to be the main venues of infection.


In fact, all the latest cases of community-level infection have been reported from schools. On the one hand, this is a warning that the epidemic situation is gloomier than we anticipated. On the other hand, it challenges us to rethink the efficacy of current precautions. They are either defective by design, or not implemented as required.


Sources with the Ministry of Education disclosed negligence in some schools where infection was reported. That is cause for worry.Since the H1N1 influenza is widely believed to be entering a second wave of infection, and the majority of our people are vulnerable to it, our only sensible response should be to redouble preventive efforts. Given the particular vulnerability of schools, school authorities must make sure no blind spots are left unattended in the precautions observed.


The State Council has issued an order for government offices, large firms and professional institutions to work out emergency response plans. That may be the only way to ensure that the highly contagious illness does not cause major disruption of normal life. With the rapid increase in local infection and manifestation of severe symptoms, we may have to prepare for more difficult scenarios.


To complicate things further, the infection has already spread to the inadequately equipped western regions and rural areas. That the country's epidemic control has been so far so good has a lot to do with the relative concentration of infected people being in the major cities. For quite sometime in the beginning, the infection was limited to "imported" cases in cities like Beijing. But, not any more. Every province, municipality and autonomous region has reported cases of infection.


And, the country is soon to take an eight-day break. We are expecting a record number of travelers, more than 200 million, some say, to hit the road. Every past "golden week" saw the country's public transport network packed to capacity. While holding the promise of record profit for the tourism industry, this coming national holiday season will constitute a daunting test for epidemic control preparedness.


Considering the less-than-serious current symptoms, it may be impossible to make people avoid travel during the "golden week." Not to say that the authorities have been racking their heads to stimulate domestic spending.


The government has also called on the transport and tourism departments to prepare emergency response plans. But would they adopt the same rigorous screening as in schools?


The authorities have decided to provide vaccines for all those participating in the National Day parade. But they are a very small number compared with the army of vacationers.







With the obvious improvement in living standards and higher level of health care in recent decades, the rising rather than falling rate of birth defects among newborns merits attention.


Statistics from the Beijing municipal health bureau show that the rate of birth defects was 170.82 per 10,000 in the capital city in 2008, nearly twice as high as the 90.78 per 10,000 in 1997. Statistics suggest that a similar pattern prevails in other provinces and regions. The number of newborns with defects is as many as around 1 million nationwide annually.


It goes without saying that a baby with birth defect will greatly diminish the happiness that the addition of a new member brings to the family. The medical expenses and worries about the future of such babies will affect adversely the family's economy and psychology. The increasing number of such newborns will, at the same time, become a heavy burden on social security.


Despite pre-marital medical checkup, regular examinations during pregnancy and other measures to reduce birth defects, their steady increase reminds us of the necessity to look at our way of life and the deteriorating environment.


In the country's most developed city of Guangzhou, south China's Guangdong province, the rate of birth defects was as high as more than 170 per 10,000 at the turn of the century. It was reported that workplace air pollution and contaminated working environment were one of the causes.


In that case, how can birth defect rate be so high in Beijing where the air is cleaner and working condition better for white-collar workers than in Guangzhou?


This has a lot to do with our way of life, including stress. A lot of white-collar workers are under heavy pressure and they seldom spare time for outdoor activities. In addition, they have to work on computers for many hours a day. Anyone working in such a state will definitely suffer a negative impact on his or her overall health condition, which, in turn, will affect the health of their babies.


Such bad habits as drinking, smoking and staying up late on the part of parents can also cause birth defects.


Moreover, an increasing number of professionals choose to have children late in life because of career pressure. In order to get better positions or pay, many young women postpone having babies until they have missed the best years for childbirth. That also increases the chance of birth defects.


So apart from making more effort to better protect our environment from further pollution, we also need to think about the sacrifices we make for material comforts. Young urban professionals may need to be taught how to give themselves some respite from the pressures of both work and life.







The decision by the Obama administration to impose heavy import tariffs on Chinese tires revealed the contradiction in games among different nations amid globalization.


For a long time, people have been singing praises to globalization. Indeed, productivity factors flew among different countries in order to seek the best resource combination under globalization. The confrontation between capitalist and socialist camps after World War II, however, not only hindered large-scale worldwide economic cooperation, but also deepened the ideological confrontation between them, which was in the interest of none.


The post-Cold War era saw the surge of a new round of globalization. China, with the world's largest population, became a more and more attractive destination for foreign investment as it boasts a large and cheap labor force, which is its main advantage. In seeking higher profit, the surplus capital in developed countries were flowing to underdeveloped countries, such as China, forming an unprecedented transnational integration of capital and labor. In this regard, the economic globalization can undoubtedly play a positive role in mitigating traditional world political barriers, enhancing cooperation and improving international relations.


China is one beneficiary of the economic globalization process, during which more jobs are provided for its people and more fiscal taxes brought to its government in addition to social stability and national development, which have enhanced the governing Party's performance. For the developed countries such as the US, importing large quantities of cheap but good-quality Chinese products lowered the living cost of its people, especially those middle- and low-income groups. Furthermore, the US investors, who benefited from the Chinese market, become a positive driving force for stabilizing Sino-US economic and trade ties.


Although globalization seems irreversible, not every country can really benefit from it, and neither can every group in the beneficiary countries benefit. It is obvious that the large-scale economic development, since China adopted the policy of reform and opening-up, has imposed some serious threat to its domestic environmental and ecological protection. The degree of environmental destruction in the past three decades has surpassed the total damage in the past few hundred years. China's over-emphasis on improving the investment environment and negligence in the matter of requiring investors to be heedful of environmental protection should be blamed for the destruction. The responsibility is to be assumed by the manufacturing country the investors are stationed in and directly harm the local people's environment and health. The outcome is beyond the objectives of our reform and opening-up policy and engaging in international cooperation. In the early stage of reform and opening-up, China could not impose its own high environmental standards on producers as Western countries did, because the country not only had to compete with developed countries in prices for the same kind of products, but also had to compete with other underdeveloped countries in labor cost in the age of globalization.


Indeed, the large amount of Chinese products in the US supermarkets increased the purchasing power of American medium- and low-income groups and improved their living quality. But in this case, both China and the US could not get a complete win-win result. While enjoying cheap products, the US must bear the cost of relative recession of the same-type products. The benefit brought by improving the purchasing power means nothing to the jobless because it is employment - rather than commodity prices - that is the key source of living security for the ordinary US people.



There are many complicated conflicts in the Sino-US economic linkage, which is traditionally seen as a binder of bilateral ties. While a lot of people benefit from Sino-US economic and trade cooperation, some suffered. Even if there was no sluggishness in import demand in the US caused by the financial crisis, China's ever-increasing export to the US could mean less quotas left for other developing countries, which in turn makes it hard for the latter to agree that China's development will bring them more opportunities.


Within the complicated context of Sino-US relationship, instead of accusing each other and arbitrarily imposing trade sanction and counter measures, the two parties should try to see each other's viewpoint and maintain bilateral relations in the spirit of criticism and self-criticism. With the launch of Sino-US Strategic and Economic Dialog, the two countries are trying to respect and take care of their respective core national interest, including each other's domestic employment rate. Therefore, when the US government decided to levy heavy tariff on tire imports from China for raising its own employment rate in tire industry, it should actively take Chinese tire workers' job opportunities into consideration. As Chinese manufacturers continually expand tire export to the US, they also should consider the relevant economic and political impact to ease the anxiety of their American peers.


As long as China and the US have consideration for each other, their disputes on trade and in other fields will not escalate but can be successfully dissolved. As the biggest economy in the world, the US undertakes more responsibility and competence to assist developing countries. The nature and reality of China's socialism necessitate the pursuit of happiness for people in the world. The two parties should put more emphasis on cooperation and mutual benefit and recognize the principle of settling their disputes through dialog and cooperation.


The author is a professor and director of the Center for American Studies at Fudan University.








Until the 17th, rather the 19th, century, China and India led the world both in innovation and commerce, two fields that usually go together. Till the early 1800s, together they contributed more than half of the global production.


But the systematic destruction of their local industries and enterprises by European colonizers reduced China and India to a pitiful condition by the beginning of the 1950s. The two neighbors had become overwhelmingly poor, and lacked the technology and knowledge to move forward.


It was Mao Zedong's opening up to the US in the 1970s followed by Deng Xiaoping's economic reforms in the 1980s that reversed the stagnation of China, igniting successive waves of development.


The reunification of Hong Kong with the Chinese mainland in 1997, and the subsequent preservation of its prosperity saw the re-emergence of China as a leading force in international geopolitics. By then, India's economic reforms, which started in 1992, had created a dynamism in its mercantile sector that had been absent since the British colonialists suppressed the local industries in the 1800s.


Colonialism wrought havoc on the globe and its people. In Africa, Asia and South America, large numbers of people paid with their lives. The two world wars saw the European and other colonizers exterminate each other almost as comprehensively as they had destroyed other countries and peoples. An unintended con-sequence of the two wars was the weakening of colonialism and the subsequent liberation of China, India, Indonesia, Egypt and other countries from external rule.


The human and ecological damage caused by European and other colonizers mandates that the group that gains primacy in human society in the future ought to draw a different road map for growth. The world cannot afford a replay of the carnage of the past five centuries.


Just as Europe rose from the depths of the medieval period, so is Asia rising today from the hollows created by the colonizers. Unless the overall situation changes unexpectedly, Asia will continue to displace Europe as the center of global geopolitics, a process in which China will play the leading role, followed by India, Japan, Indonesia and later perhaps Iran.


Unlike the zero-sum consequence of the expansion of Europeans, the emergence of China (and later India) needs to be fashioned on the basis of mutual benefit, so that the rest of the world also enjoys its fruits, instead of shrinking further as was the case in the past.


President Hu Jintao has highlighted the harmonious development of China. This concept needs to be expanded to refer to a similar process throughout the globe. China's and India's interactions with other countries have to be based on the principle of mutual benefit, rather than remaining rooted in zero-sum equations, where one side gains at the expense of the other.


In many ways, China's relations with other countries have yielded mutual benefits. For example, till very recently African nations had no option but to rely on their European and North American counterparts to utilize their resources. As a result, they were paid low prices for their products, while the European and North American countries made huge profits.

With the entry of China (and to a lesser extent, India) into the continent, African countries now have an option, and hence get better prices for their products. China and India both need to ensure that the African nations no longer remain just suppliers of raw materials, but also grow into manufacturing and service hubs.


For more than four centuries, a small segment of the local population in Africa (which was of European origin) controlled practically all the resources and wealth of the continent's countries. Only in the 1960s did the native populations began emerging from centuries of suppression to assume state power.


China and India need to link with these elements and help them on their journey toward equal opportunity. They are likely to get the help of most elements in present-day Europe and North America because people there have given up the zero-sum mentality of their ancestors for mutually beneficial equations.


In most of Europe, people of Asian and African origins live with dignity because of the moderate attitude of the native majority populations. In the US, an extraordinary event took place in 2008, when a largely European-origin pool of voters chose Barack Obama over John McCain to be their president. We need to acknowledge this shift in mindset, and not allow resentments caused by past experiences to influence our decisions toward Europe and North America.


Non-violence (or ahimsa in Sanskrit) is at the core of Indian civilization, just like it is in China's. Just as economic relations need to be crafted on a mutually beneficial basis, so too should political interaction remain peaceful in line with the commitment of China and India to a harmonious world.


Although global uncertainty demands that countries maintain powerful armed forces and develop technology needed to give them the edge. Yet the best (indeed the only) use for such armies should be to advance technological development through innovation and experimentation, provide relief to disaster regions, and create disciplined forces committed to the growth of their countries without harming others.


The Chinese and Indian armed forces are engaged in tasks such as fighting piracy and preventing proliferation of deadly technologies, which benefit the entire world. The two armed forces have played leading roles in providing help to millions of people ravaged by floods, earthquakes and diseases in their respective countries.


China is on its way to becoming the most productive country on the planet as it was for 2,500 of the past 4,000 years. Care needs to be taken to ensure that this steady rise is imbued with "Chinese characteristics", so that the values of mutually beneficial development, social justice and global harmony are followed.


Partnerships rather than conflicts, mingling of peoples instead of segregation, and as equitable a distribution of wealth as possible as opposed to concentration of resources in a few hands are a few principles that need to be adopted by China and other emerging Asian giants to help create a new world order that respects all instead of acting for the benefit of only a few.


The author is UNESCO peace chair and professor of geopolitics in Manipal University, India.










EDITORIAL from The Pioneer, The Times of India, Hindustan Times, The Indian Express, The Financial Express, The Hindu, The Statesman’s, The Tribune, Deccan Chronicle, Deccan Herald, Economic Times, The Telegraph, The Assam Tribune, Pakistan Observer, The Asian Age, The News, The New York Times, China Daily, Japan Times, The Gazette, The Sydney Morning Herald, The Australian, The Guardian, JakartaPost, The Moscow Times, The Bottom Line and more only on EDITORIAL.




Project By


a trust – of the people by the people for the people

An Organisation for Rastriya Abhyudaya

(Registered under Registration Act 1908 in Gorakhpur, Regis No – 142- 07/12/2007)

Central Office: Basement, H-136, Shiv Durga Vihar, Lakkarpur, Faridabad – 121009

Cell: - 0091-93131-03060

Email –,

Registered Office: Rajendra Nagar (East), Near Bhagwati Chowk, Lachchipur

Gorakhnath Road, Gorakhpur – 273 015



No comments:

Post a Comment

Note: Only a member of this blog may post a comment.

Amazon Contextual Product Ads