22 January 2014

A mismatch of nuclear doctrines

January 22, 2014 
Raja Menon

Special ArrangementVITAL QUESTIONS: The ‘massive’ retaliation promised in the Indian nuclear doctrine is being increasingly questioned by scholars and analysts. This handout photograph released by the Defence Research and Development Organisation shows the launch of Agni V intercontinental ballistic missile at Wheeler Island, Odisha, on September 15, 2013.

India intends to deter nuclear use by Pakistan while Pakistan’s nuclear weapons are meant to compensate for conventional arms asymmetry.

Manufacturing a nuclear weapon does not, as a senior Indian Minister in 1998 claimed, create credible deterrence. Deterrence is entirely a matter of perceptions, a mental effect that is created on the adversary that nuclear use will entail assured retaliatory holocaust. The possibility of nuclear use is thereby pre-empted. The Indian nuclear doctrine, in that sense, is well articulated — on paper. Since 1998, more than 15 years have passed and in the Indian sub-continent, nuclear arsenals have grown far beyond the small nuclear ambitions that were articulated then. Yet there is an increasing fund of world literature being published, pointing to structural and operational weaknesses in the Indian nuclear arsenal. The question is not whether India has built enough nuclear bombs. Hardly anyone questions this basic fact, but the ideational systems that will ensure the ‘massive’ retaliation promised in the doctrine are being increasingly questioned by scholars and analysts worldwide. Pakistani observers cannot help but be swayed and dangerously influenced by such literature, thereby inducing them to think the unthinkable. What does not help in encouraging sober thinking is the fact that since the end of the Second World War, South Asia has seen the largest number of shooting wars in the world. So the questions of nuclear use will not arise in the quiet peace of neighbourly relations, but in the stress of combat over the Line of Control or the international border.The 1998 test

Critics of the credibility of India’s nuclear arsenal begin with their doubts on the success of the thermo-nuclear test of 1998, which they claim was a ‘fizzle.’ There has been much toing-and-froing in technical journals, of the veracity, accuracy and interpretation of seismic readings. There has also been an occasional closed door briefing by select bomb makers — but surprisingly there has not been, to date, a clear unambiguous public statement from the right source about the country’s thermo-nuclear capacity being fielded in India’s nuclear arsenal. This is a matter of some negligence, considering that the only members of the scientific community who have spoken on this issue are deeply sceptical of the success of the thermo-nuclear test.

The command and control of nuclear forces are another area of criticism, and not surprisingly so, since India is the only nuclear weapon country without a Chief of Defence Staff to act as the interface between the Prime Minister, the National Command Authority and the military who ‘own’ the weapons — at least most of it. In the guise of safety, India’s nuclear weapons are not only ‘de-mated’ and the core and ignition device separated from the warhead, but the separate components are under different departmental control. The actual reason for this bizarre arrangement is quite obvious. There is a petty turf war, and neither the Department of Atomic Energy nor the DRDO is willing to let go of the controlling part of the bomb, even if it means a cumbersome and unnecessary loss of control. Needless to say, between the military, the DAE and the DRDO, none of them has any hierarchical control over the other two.


Wednesday, 22 January 2014 | Ashok K Mehta |

Officially, Pakistan supports the idea of non-interference in Afghanistan. But it has also made clear that it is unable to cooperate with Kabul till its concerns are met, such as downsizing the Indian presence there

Don’t try it: Getting to Islamabad 900km from New Delhi by air via Dubai, as it takes a tortuous 16 hours, leave alone the immigration hassles and check-in at the thrice-bombed JW Marriott hotel. JWM has now a foolproof security procedure, second only to Hotel Serena Kabul. Islamabad and Rawalpindi are called twin cities, but you need a separate visa for the latter and if you are lucky, one sans police reporting.

Returning last week to Pakistan after 1996 was a useful experience. In 1996, former Chief of Army Staff, General VN Sharma, led a delegation of Rimcollians (graduates of the Rashtriya Indian Military College in Dehradun), at the invitation of Interior Minister Nasirullah Khan Babar, whose numerous claims to fame include fathering the Taliban and possessing a replica of the Fasting Buddha. Pakistani newspapers described the Rimcollian arrival as ‘land invasion of Pakistan, led by former Indian Army Chief’. This time around, The News (January 14) carried this headline: Indian Army chief admits killing 10 Pakistani soldiers...” , invoking the 19th century French proverb that the more the world changes, the more it stays the same.

That nothing has changed at the basic level in Pakistan was confirmed during and after the Friedrich-Ebert-Stiftung facilitated Track II launch of the Regional Declaration on Afghanistan. The declaration is a well-reasoned and sober document urging Pakistan to remove the root causes of trust deficit between Afghanistan and Pakistan (read: removing sanctuaries for Afghan Taliban and helping push the peace and reconciliation processes).

There were several lessons emerging from the discussion. Lesson Number One: The divergent but dominant Rawalpindi-Punjabi versus Peshawar-Pashtun mindset. Lesson Number Two: Most Pakistanis continue to live in denial. Afghans and other interlocutors were told that non-state actors, created and nurtured by the military establishment, have gone ballistic and are no longer under state control. The message: Pakistan may be unwilling and unable to cooperate with Afghanistan unless some of its concerns are met — these include downsizing Indian presence, accommodating the Afghan Taliban in Government and the border question involving the Durand Line. Reining in the Haqqanis and Mullah Omar’s Shura involves a grand bargain.

Abe in Delhi

C. Raja Mohan | January 22, 2014 

In inviting Shinzo Abe, the prime minister of Japan, to be the chief guest of this year’s Republic Day celebrations, Delhi has underlined the special importance it attaches to East Asia. (PTI)
Abe is the fourth East Asian leader to be part of the annual event in the last five years.

A fortnightly column on the high politics of the Af-Pak region, the fulcrum of global power play in India’s neighbourhood.

In inviting Shinzo Abe, the prime minister of Japan, to be the chief guest of this year’s Republic Day celebrations, Delhi has underlined the special importance it attaches to East Asia. Abe is the fourth East Asian leader to be part of the annual event in the last five years. The Thai prime minister, Yingluck Shinawatra, was the chief guest in 2012, and her predecessors were Indonesian President Susilo Bambang Yudhoyono (2011) and Korean President Lee Myung-bak (2010).

In the 60 years before 2010, only four Southeast Asian leaders were serenaded in the celebrations to mark the founding of the republic — Singapore Prime Minister Goh Chok Tong (1994), the general secretary of the Vietnamese Communist Party, Nguyen Van Linh (1989), Prince Norodom Sihanouk of Cambodia (1963) and President Sukarno of Indonesia (1950). January 1958 saw an interesting chief guest: China’s defence minister, Marshal Ye Jianying. That was just before Sino-Indian relations took a turn for the worse and ended up in the 1962 war.
The frequent presence of East Asian leaders at Republic Day events is a reflection of the region’s growing weight in India’s economic and strategic calculus. After an intense focus on Asia in the 1950s and early 1960s, India turned its back on the region and was more preoccupied with the agenda of the non-aligned movement. It is with the Look East policy of the early 1990s that Asia returned to the centrestage of Indian foreign policy. For all the new importance of East Asia for India, a Japanese prime minister witnessing the military parade on Rajpath will draw considerable attention in the region. That it is Abe, whose military policies are being watched with much anger in Beijing and some wariness in Washington, might make this Republic Day somewhat special.

Grandpa Kishi Abe has made political history in Japan by returning to power after he resigned from the top job in 2007. Abe will also be the first Japanese prime minister to visit India twice. Few Japanese leaders in the modern era have shown the kind of commitment that Abe has towards building a strategic partnership with India.

Terrorism is now global and local

Shyam Saran
Last updated on: January 20, 2014 

A disparate global network of violent fundamentalist Islamic groups threatens India's eastern flank as much as the north and west with a real possibility of these spilling over into our borders, says Shyam Saran.

News that the Iraqi branch of Al Qaeda, the Islamic State of Iraq and al Shams and its affiliates, have occupied key cities in the country's Anbar province, is only the latest in a series of advances made by violent and extremist Islamist groups in a wide arc stretching across, West Asia and Africa, particularly during the past year.

The Arab Spring, which began with a successful popular movement against a corrupt and despotic regime in Tunisia in December 2010, soon engulfed Egypt, Libya and Syria but the original democratic and liberal impulse behind the movement soon yielded place to better organised, often armed and violent sectarian forces.

The United States and its Western allies not only ignored this unfolding though uncomfortable reality, but instead sought to ride the fundamentalist Sunni wave to isolate Shia Iran and to destabilise its regional ally, Syria. The Gulf monarchies, in particular Saudi Arabia and Qatar, were actively encouraged to provide funds and weapons to the most fundamentalist and violent opposition groups in these target countries. Turkey, under Recep Erdogan, was also drawn into this cynical game. The results were predictable and were analysed in my column ‘Arab Spring turns searing summer’ where I had warning, in particular, of the danger to India's plural and secular dispensation from these forces being unleashed in our neighbourhood.

What needs to be understood is that the danger does not emanate from a monolithic and coherent entity called Al Qaeda, but rather from an increasingly exclusionary, fanatical and violent ideology, which is shared by a loosely constituted international network of local Al Qaeda branches, their numerous affiliates and associated fundamentalist groups. These may be powered by local grievances or causes anchored in different national narratives. However, one should not make the mistake of identifying such groups as being ‘nationalist’ or ‘conservative’ and hence allow them to escape the scrutiny they deserve as real or potential sources of international terrorism. We see such tendencies in the US and some other Western countries, that now appear willing to accept the Afghan Taliban as a local and nationalist group not necessarily targeted against Western interests as is, avowedly, the Al Qaeda.

*** The Geopolitics of the Syrian Civil War

Geopolitical Weekly
JANUARY 21, 2014


International diplomats will gather Jan. 22 in the Swiss town of Montreux to hammer out a settlement designed to end Syria's three-year civil war. The conference, however, will be far removed from the reality on the Syrian battleground. Only days before the conference was scheduled to begin, a controversy threatened to engulf the proceedings after the United Nations invited Iran to participate, and Syrian rebel representatives successfully pushed for the offer to be rescinded. The inability to agree upon even who would be attending the negotiations is an inauspicious sign for a diplomatic effort that was never likely to prove very fruitful.

There are good reasons for deep skepticism. As Syrian President Bashar al Assad's forces continue their fight to recover ground against the increasingly fratricidal rebel forces, there is little incentive for the regime, heavily backed by Iran and Russia, to concede power to its sectarian rivals at the behest of Washington, especially whenthe United States is already negotiating with Iran. Ali Haidar, an old classmate of al Assad's from ophthalmology school and a long-standing member of Syria's loyal opposition, now serving somewhat fittingly as Syria's National Reconciliation Minister, captured the mood of the days leading up to the conference in saying "Don't expect anything from Geneva II. Neither Geneva II, not Geneva III nor Geneva X will solve the Syrian crisis. The solution has begun and will continue through the military triumph of the state."

Widespread pessimism over a functional power-sharing agreement to end the fighting has led to dramatic speculation that Syria is doomed either to break into sectarian statelets or, as Haidar articulated, revert to the status quo, with the Alawites regaining full control and the Sunnis forced back into submission. Both scenarios are flawed. Just as international mediators will fail to produce a power-sharing agreement at this stage of the crisis, and just as Syria's ruling Alawite minority will face extraordinary difficulty in gluing the state back together, there is also no easy way to carve up Syria along sectarian lines. A closer inspection of the land reveals why.

The Geopolitics of Syria

Before the 1916 Sykes-Picot agreement traced out an awkward assortment of nation-states in the Middle East, the name Syria was used by merchants, politicians and warriors alike to describe a stretch of land enclosed by the Taurus Mountains to the north, the Mediterranean to the west, the Sinai Peninsula to the south and the desert to the east. If you were sitting in 18th-century Paris contemplating the abundance of cotton and spices on the other side of the Mediterranean, you would know this region as the Levant -- its Latin root "levare" meaning "to raise," from where the sun would rise in the east. If you were an Arab merchant traveling the ancient caravan routes northward from the Hejaz, or modern-day Saudi Arabia, you would have referred to this territory in Arabic as Bilad al-Sham, or the "land to the left" of Islam's holy sites on the Arabian Peninsula.

Murphy's Law: Why Good Works Produce Bad Results


January 20, 2014: The UN, Red Cross and thousands of other foreign aid organizations are having a harder time raising money, in large part because they are having an even harder time dealing with the growing revelations about the extent to which foreign aid is stolen after arriving in the countries where it is needed. The plundering has gone on for so long that the thieves have gotten greedy and sloppy. For example, the refugees from the 1960s-70s war in southern Morocco (West Sahara) decades ago are still sitting in Algeria supported by foreign aid. But it’s become increasingly obvious that, while the aid organizations are regularly providing aid for 120,000 refugees there are only about 40,000 real refugees in the camps. The rest of the aid goes to make a few Polisario (the rebel group that runs the camp) leaders and Algerian officials millionaires and many more underlings wealthier. For years people who lived in the camp have casually told outsiders, including reporters, details of how aid is stolen and resold and deals made with air officials to keep the loot coming. 

The Palestinian aid scams are increasingly being documented, in part because Palestinian leadership has been split since 2007 between Fatah and Hamas and partisans for both groups are willing to offer up details of the misbehavior of their rivals. Israel has been complaining about this aid abuse for decades and now Palestinians are corroborating, in detail, many of the Israeli charges. This puts increasing pressure on donor nations to push Palestinian leadership. Some donors are not bothering with that and have simply stopped giving. 

Now there are over three million Syrian refugees in Lebanon, Turkey and Jordan and the plundering is already underway despite the obvious suffering of so many of those in the camps. Moreover cell phones make it easier to document and expose the theft. No wonder the UN is having a hard time raising the $6.5 billion is says is needed to keep the camps going. 

Don't leave diplomacy to diplomats

Nitin Pai
January 20, 2014 

The perfunctory management of external affairs has left India's foreign policy establishment largely unprepared to manage the consequences of dramatic international developments, says 

The geopolitical upheaval around the world over the last two years has been matched with lukewarm political stewardship of foreign policy in New Delhi. Revolutions and civil wars have begun in West Asia, East Asian powers are in a state of sharp reaction to Chinese assertiveness in the oceans to our east, creeping political realignments are ongoing in Afghanistan-Pakistan and American troops are preparing to leave the region.

Each of these developments can have profound consequences for India’s security and economic interests -- yet India's approach towards each of these has been characterised by a lack of political direction, resulting in a foreign policy that is at best on autopilot, and at worst in abdication. Foreign policy -- and, by extension, India's geopolitical position -- has been an unlamented casualty of the United Progressive Alliance government's unhappy political predicament.

The perfunctory management of external affairs has left the foreign policy establishment largely unprepared to manage the consequences of dramatic international developments. There's only so far you can go with a holding brief. We could neither anticipate nor even play a bit role in shaping the trajectory of US-Iran relations, despite being one of the best-placed countries to do so. India is now a distant observer of events that have the potential to upturn long-standing calculations.

If playing international statesman is tall order, what explains the bizarre manner in which the Khobragade affair played out, souring a relationship that took three governments a decade and a half to build? Yes, the episode occurred at an inopportune time -- during a change of guard both at the Indian embassy in Washington and at the US State Department officialdom concerned with India, amid the end-of-the-year holiday season. A matter that might have been resolved more quickly and with less controversy instead rocked the boat even more than when the Central Intelligence Agency spirited its mole out of New Delhi 10 years ago.

Yes, there was ample reason for India to retaliate against the violation of diplomatic norms by US authorities. There is a strategic logic for a policy of tit for tat. There is also logic -- though seldom employed by New Delhi -- in being deliberately irrational. However, in this case, our establishment overdid it to such a point that its actions were more in the nature of lashing out at US diplomats than a calibrated strategy to arrive at a desired outcome. This continued even after Devyani Khobragade arrived in India and after an American official was expelled in return.

Murphy's Law: Top Ten Bad Decisions of the 20th Century

January 21, 2014: War brings out the worst in people, especially when it comes to making really bad decisions that have horrendous consequences. Below are the ten worst wartime decisions of the 20th century. 

1-Germany gives Austria-Hungary free hand in 1914. The Austro-Hungarian Empire was falling apart in 1914. The assassination of the Austrian crown prince in 1914 by a Serb nationalist gave Austrian hard-liners an opportunity to crack down on Slav dissidents in the Balkans. But this meant threatening war in the Balkans. That could bring in the Russians. Cooler heads suggested that Germany be consulted. The Germans told the Austrians to do what they thought best, and that Germany would back them up. This was a popular decision in Germany, where there was sympathy for the Austrians (who, while Germanic, were a minority in their own empire). The Austrian bluff didn't work, the Serbs fought, and the Russians came to the aid of the Serbs. The French honored their treaty with Russia and went to war as well. What began as an assassination turned into World War I. That, in turn, led to World War II. All because Germany would not say "no" to Austria's desire to start a war over an assassination. 

2-Germany declares unrestricted submarine warfare in 1917. Once in the war, Germany slowly, but irresistibly, began to win. One minor problem was its submarine war against British shipping from North America. The United States was neutral in the war, and American popular opinion was very much against getting involved. Germany, aware of American public opinion tried to avoid torpedoing ships carrying Americans. This was difficult so in 1917 Germany decided to make things a little easier for German submarine captains by allowing them to sink anything they came across. This led to German subs sinking ships with a lot of Americans on board. That was enough to get America into the war, and prevented Germany from winning World War I. 

3-The victorious allies impose harsh terms on Germany after World War I. This created the economic and political atmosphere that enabled the Nazis to come to power. It was the same kind of harsh treatment of the French by the Germans after the 1870 war that helped cause World War I. This pattern finally was noted after World War II and a more practical approach adopted. In the 1920s German politicians allowed petty feuds and a desire for political revenge to make it possible for Adolf Hitler to take power in 1933. None of the mighty politicians, generals and business leaders thought a petty operator like Hitler could hold onto power even after he got it. They were wrong. 

United States Should Include Pakistan in its Rebalance Policy Toward Asia, Argues CFR Special Report


January 21, 2014 

As U.S. and coalition forces prepare to draw down troops in Afghanistan, a new report urges Washington to view Pakistan not solely or even principally in the context of U.S.-Afghanistan policy, but rather to reorient the relationship toward Asia. "A U.S. strategy for Asia that does not contemplate Pakistan's role is incomplete, and a U.S. strategy for Pakistan that primarily considers its role in the context of Afghanistan is shortsighted," writes the report's author, Daniel S. Markey, CFR senior fellow for India, Pakistan, and South Asia. 

The report, Reorienting U.S. Pakistan Strategy: From Af-Pak to Asia, outlines a two-pronged approach to future U.S. policy for Pakistan: defend against security threats, and support Pakistan's economic growth and normalized relations with its neighbors. Markey recommends that the United States: 
launch a new diplomatic dialogue with China, India, and Pakistan to reduce prospects for regional tension and violence; 
sign a trade deal that also encourages trade between India and Pakistan; 
reallocate assistance in Pakistan to improve trade and transit infrastructure; and 
integrate Pakistan into East and South Asia policymaking across the State Department, National Security Council, and Department of Defense, and deemphasize the Af-Pak connection. 

Markey is the author of No Exit from Pakistan: America's Tortured Relationship with Islamabad , which explains how Washington can prepare for the worst, aim for the best, and avoid past mistakes in U.S.-Pakistan relations.

The Musharraf Trial & Beyond

20 January 2014

Salma Malik
Assistant Professor, Department of Defence & Strategic Studies, Quaid-i-Azam University, Islamabad

On January 2, General Musharraf ended up at the Armed forces institute of cardiology in Rawalpindi, a rather long detour from his residence to the court, which had made a third unsuccessful attempt to summon the ex-president on charges of treason. 

With speculations ranging from whether there was a deliberateeffort afoot to prevent the general from reaching the court to how smartly once gain a court appearance had been avoided, the General remains hospitalized. After the initial hoopla about the whys and whats of the event, it is just another news item, till the next big audience. However, one wonders what if instead of the quiet yet highly professional new chief justice Jillani, it was the media’s darling Justice Chaudhry still holding the office, could these deferments be possible? Every word uttered by the Chief Justice would make proverbial breaking news across the television channels, and for many the trial appeared more on the personal grid than its merit. 

An unfortunate situation, as very often public weds itself to popular sentiments and opinions about what the truth should be, than what it actually is. Should Musharaf be handed out the guilty verdict on high treason? For some, the answer is in affirmative, as it would prove a deterrent for future khaki interventions and perhaps cosmetically redress the civil-military imbalance. Yet a review of the state of affairs, indicates problems where the military appears least zealous given the circumstances than civilian administers, who need to do their necessary bit. 

While the media remains preoccupied on providing situational updates on Musharaf, the most urgent and pressing concern in the first two weeks of the new year has been the rising number of terrorist bombings. Not less than fifty people, including civilians and law enforcement officials have perished as a result. Yet again, there has been a divided house when it comes to dealing with the non-state terrorist elements. Where the KPK provincial government under the PTI prefers dialogue with the “disillusioned brethren” over direct military action, the federal government appears totally ambivalent about how to tackle this critical and most pressing issue. 

Both the provincial and federal governments seem to disregard the drawdown of foreign troops from Afghanistan and a different politico-military arrangement, which appears nightmarish for Pakistani security forces. The forces have been preoccupied domestically for more than a decade, and the non-state elements, have a bigger playfield and target practicing to carryout. 

The social and traditional media cannot get enough out of the deaths of Aitzaz Ahmed a young school boy, who bravely lost his life by thwarting a suicide attack on his school mates and that of Chaudhry Aslam, a daredevil policeman, who for long led a charmed life and stood out as a symbol of defiance and destruction for terrorist elements in the troubled port city of Karachi. These two brave sons of the soil are not the only one lost in this brutal war against terrorism and militancy. There have been many who precede them and unfortunately many who would gladly follow their footsteps, but is this a fair price to pay. 

Reorienting U.S. Pakistan Strategy

From Af-Pak to Asia

Author: Daniel S. Markey, Senior Fellow for India, Pakistan, and South Asia

Download Now 
Publisher Council on Foreign Relations Press 
Release Date January 2014 
50 pages
ISBN 978-0-87609-579-9
Council Special Report No. 68


For more than a decade, U.S. strategy toward Pakistan has been dominated by the struggle against terrorism. The war launched in 2001 in neighboring Afghanistan and waged, in part, in Pakistan's tribal regions has overshadowed America's other interests in South Asia, not least nuclear issues, regional stability, and economic growth. Today, as the United States "rebalances" its foreign policy focus toward Asia, and as the U.S. military draws down its presence in Afghanistan, the relationship between the United States and Pakistan is poised for reassessment. The outcome, however, is anything but clear. A clean break between Pakistan and the United States seems unlikely, despite simmering disagreements over a number of issues. Also unlikely is a full rapprochement. That said, if it chose to do so, Pakistan could contribute to the advancement of U.S. priorities in Asia, Afghanistan, and the war on terror, but the country's weak governance, slow economic growth, and growing nuclear arsenal combine to cast serious doubt on whether it will so choose. 

In this Council Special Report, Daniel S. Markey examines Pakistan's complex role in U.S. foreign policy. Markey advocates a two-pronged U.S. approach to Pakistan that works to confront and quarantine the immediate threats it poses to regional security and stability while simultaneously attempting to integrate it into the broader U.S. agenda in Asia. 

Regional security is with good reason the first prong of Markey's strategy. The destructive potential of a weakened, isolated, and/or hostile Pakistan is, he writes, significant. An armed conflict between India and Pakistan, or a major Pakistan-based terror attack on India, would not only disrupt India's booming economy but also affect wider regional stability. Pakistan's internal security threats, Markey notes, are no less serious, and the possibility that it will continue to offer safe haven to terrorist organizations, imperil Afghanistan's reconstruction, or disrupt U.S. negotiations with the Taliban is a source of real concern.

Myanmar: Running From The Past

January 21, 2014:

 A second peace conference between the government and 17 tribal rebel groups has begun. Not all the rebel groups are attending and not all those who are believe that the discussions will succeed. But with the military government gone there is more optimism that last peace deals can be made. The pessimists point out that the most corrupt institution in Burma is still the military and the new constitution that returned democracy in 2010 explicitly granted military leaders (including all the retired officers) immunity from prosecution for past crimes. The military was also given control of the defense ministry and a fixed number (25 percent) of seats in parliament. In effect, the military leaders who once ran the country are still in charge of the defense budget and immune from prosecution for all the stealing they did in the past. Real reform will be very much an uphill slog and the military is ready to push back and win. The new government is actually trying to not be a tool of the former military junta. Reforms are slowly being made. However the 2010 elections replaced the military dictatorship with many of the same people, out of uniform and trying to hide the fact that they rigged the vote. In response to this the rural tribes in the north revolted (again) but most were persuaded to make peace deals by 2013. These deals may not last and not everyone up there made peace. Decades of low level fighting against ethnic separatists in the north has resulted, during the last decade, in major victories for the government. There is not a lot of fighting, but major movements by Burmese troops into separatist areas that were long outside the control of the government. Temporary peace deals were made but the tribal rebels are producing major quantities of methamphetamine, and increasing amounts of heroin, to support continued fighting. China is not happy with many of these drugs (particularly heroin and meth) coming into China. That is difficult to change because the tribes are poor and the drug money is very attractive. China is also concerned with the popular opposition to major Chinese economic projects (dams and pipeline) in the north but the fundamentals remain the same. Tribal separatists continue to flee into Thailand. The government has done little to suppress a 2013 outbreak in anti-Moslem violence. Overall, economic and political progress is slow. 

China’s generosity with aid and large investments in Burma make Burma one of the few reliable Chinese allies in the region. Otherwise China is much disliked by its neighbors, mainly because to border disputes and Chinese claims over the South China Sea. This is a 3.5 million square kilometer (1.4 million square mile) area south of China and Taiwan, west of the Philippines and north of Indonesia. China claims all of it and this has aroused the ire of the neighbors and caused them to unite against China. This is often done via ASEAN (Association of Southeast Asian Nation), which has taken a lead role in trying to arbitrate the disputes between ASEAN members and China over ownership of island in the South China Sea. This move is meant to persuade China to behave. Burma is an ASEAN member and is the only member that defends China. That has proved very useful in limiting the diplomatic damage ASEAN can do to China. ASEAN was established in 1967 by Indonesia, Malaysia, the Philippines, Singapore and Thailand, and later expanded to include Brunei, Burma, Cambodia, Laos, and Vietnam. All the ASEAN nations have some disputes with China. China agreed, in 2002, to cooperate with ASEAN over the Spratly Islands dispute but that was apparently all for show. 

Northeast India Anticipates Seaport

A joint India-Myanmar project will give the region access to a port. But it is not without controversy.
By Nava Thakuria
January 20, 2014

Come 2015, the people of northeast India will be able to use a seaport in Myanmar for transport and trade. The Sittwe port in the Bay of Bengal is expected to link Mizoram in the far east of India to the ocean through riverine transport and roadways. Construction work for jetties and other port facilities, which started in December 2010, is expected to be completed this year.

Called the Kaladan Multi-Modal Transit Transport Project, the venture is expected to be fully operational by the end of 2015. The project includes the improvement of Sittwe port in Arakan province, west Myanmar, construction of an inland waterway on Kaladan river and preparation for a highway transportation system linking up with the Mizoram capital of Aizwal.

The Kaladan (also rendered as “Kolodyne”) river actually originates in central Mizoram and is known as the Chhimtuipui river in Indian territory. The river enters Myanmar and crosses two very underdeveloped and poverty-stricken provinces – Arakan and Chin – before it finally empties into the Bay of Bengal. A 1999-2000 feasibility study revealed that the Kaladan is navigable within Myanmar from its confluence point at Sittwe to Paletwa. Beyond that point, the shallow waters and sharp curves make navigation infeasible. Consequently, road transport is proposed from Paletwa to the Indian border in Mizoram.

Once the project becomes operational, vessels will arrive at Sittwe port and the goods will be transported via the Kaladan river. From Paletwa, goods will be trucked via a road that will enter India through Lomasu trade point on the southern border of Mizoram. The project was conceived by New Delhi ten years ago and formalized in 2008 under its Look East Policy, primarily to develop trade with Myanmar and other Southeast Asian nations. Political observers believe that New Delhi was wanted to invest in the project, India’s largest development initiative in Myanmar, to woo the country as it slowly transforms from a military regime into a quasi-democratic government.

The trade route should also bolster India’s economic ties with other Southeast Asian countries, while benefiting the 60 million people of land-locked northeast India. Besides trade, the project seeks to expand Indian economic and political influence in East and Southeast Asia. Although the Kaladan project is a bilateral initiative between New Delhi and Naypyidaw, the Indian government is footing the bill, estimated at $214 million. The former military government of Myanmar committed the required land and security for the project, but baulked at investing money. Hence, New Delhi offered the regime a soft loan of $10 million.

At present, work is focused on dredging and widening the Kaladan river from that port at Sittwe to Paletwa, in Chin province, adjacent to India’s Mizoram. The 160 km inland waterway transport system for cargo ships terminating in Paletwa is expected to be completed by June 2014. Meanwhile, construction of a 62 km two-lane highway from Paletwa (also known as Kaletwa or Setpyitpyin) to the India border point Lomasu is also underway, after a delay. Myanmar authorities have been somewhat coy on revealing the status of the work. Progress on the Indian segment of the highway is certainly visible. Once competed, the 100 km stretch (from Lomasu to Lawngtlai in Mizoram) will connect to the Indian National Highway 54. This part of the project is slated to be completed by early next year.

Expanse of Federalism: South Asia Sui Generis?

20 January 2014
D Suba Chandran
Director, IPCS 
Email: subachandran@ipcs.org

PR Chari, in his commentary titled ‘Limits of Federalism' in South Asia, makes several important assertions on the nature of federalism evolving in the region. Both his assertions and the nature of evolution need larger debate and understanding. But this debate need not have a negative perspective, but be seen as the evolution of a South Asian form of federalism.

‘Hodgepodge of Regional Parties’: ‘Distressing Implications’ for South Asian Peace and Conflict?

While explaining the nature of evolving federal practices, PR Chari makes the argument that the “federalisation of India’s polity has enabled its conversion into a true democracy, with the unexpected result that the regional parties have now become more assertive in several of the larger states.” And is there a "A hodgepodge of regional parties...with distressing implications for peace and conflict in South Asia"

Two important issues need to be addressed here. First, why should the regional assertion be seen as an ‘unexpected result’? Is that not a logical extension of federal principles? Or is it a general expectation that in a federal set-up in South Asia, regional parties should not be assertive? 

Second, do the assertions of regional parties in federal politics essentially create a ‘hodgepodge’ with negative implications for regional security? This perception in fact is increasingly becoming common, especially in New Delhi - that assertions by regional parties (in case of West Bengal and Tamil Nadu vis-à-vis Bangladesh and Sri Lanka respectively) have affected India’s foreign policy.

These questions demand a larger debate – both in national capitals and sub-regions.

Who Decides the Composition of a Federal Government?
The government at the centre has generally been formed by national parties such as the Congress and BJP (with minor exceptions). In the last two decades, regional parties, especially from South India and West Bengal, have been playing a substantial role in the formation of federal governments. Should one be alarmed by this phenomenon?

The above also means something significant for regional politics. There is a remarkable decline of national parties in the regions. Alternatively, an argument could also be made that the regions support regional parties more than the national ones. Why? Perhaps the national parties are no more ‘national’ or are unable to address regional sentiments.

Japan: Death by Demographics?

January 20, 2014

For the past year, the biggest news story about Japan has been its territorial disputes with China and Korea. As important and potentially dangerous as this issue is, many media outlets in the US have paid relatively little attention to the other significant social, economic, and political issues that Japan is facing. Among the most complex and important of these is Japan’s low fertility and associated population decline. In 2013 Japan lost about 250,000 people, continuing a trend unlikely to abate any time in the near future. The 2013 population of Japan was about 126 million, while the Japanese government projects a drop to about 46 million if nothing intervenes to alter current trends (such as a dramatic change in immigration policy). The cause is fairly simple: Japanese have among the lowest total fertility rates (TFR) in the world at about 1.4 and this rate has been consistently under 2.0 (2.1 is needed to keep a population stable) since the mid-1970s. At the same time, the Japanese population is among the longest-lived in the word with about 25% of the people over 65 and only 13% in their teens. As the elderly have started to pass away, the population has started to shrink.

On the surface, this looks like a very troubling problem and some Japan watchers have argued it does not bode well for Japan’s future as an economic and political power in the world or inEast Asia. Problems clearly do lie ahead. The most obvious is related to the cost of healthcare. In 2000, Japan initiated a long-term care insurance (LTCI) program designed to help manage and provide the care needed by an increasingly aged population. Like many social insurance problems, the young pay for the care of the old; when those younger people reach old age, there are insufficient younger people to pay without significant tax increases. As was predicted at the time, LTCI has proven to be quite costly, leading to long-term care expenditures (including out-of-pocket expenses) that have more than doubled from four trillion yen in fiscal year 2000 to 8.4 trillion yen in fiscal 2011. And projections have these expenditures increasing to 20 trillion yen by 2025, which will represent 3-4% of GDP. This has generated a public discussion about the future of LTCI leading to a report in August of 2013 by the government’s National Council on Social Security Reform on revising the program.

Obviously, an additional issue associated with the rapid growth in the aged population is social. Traditionally, adult children have provided care for elder parents with minimal involvement of public institutions. Despite attempts by the government to maintain significant involvement of adult children in elder care for both social and economic reasons, the simple fact of low fertility leaves few options beyond expanding public services to manage and provide elder care. There simply will not be enough children in the future to provide necessary care and Japanese are much less inclined to expect their children to provide needed care than they were in the past.

Indonesia: Lessons for the World

While the country faces multiple challenges, it is important to remember how far it has come.
By Edward Parker
January 21, 2014

The year 2014 will be a pivotal year for Indonesia; one in which the political baton will be handed over. Both the nation’s highest offices will have new occupants: the House of Representatives (DPR) and the presidency. Indonesia will begin a new chapter in its history.

The new custodians of Indonesia’s future will face many challenges. Recent months have brought a chorus of criticism as the economy slowed, the rupiah slid, and government policy appeared to lose direction. Commentators have poured scorn on the country’s economic outlook and questioned whether it deserves its status as one of the world’s hottest emerging markets.

Everyone knows the challenges; Indonesia needs to push ahead with reforms if it is to move up the economic ladder. Certainly, the country does need to do more to stay competitive, but the tremendous strides it has made should not be forgotten. Just consider where Indonesia was a little more than a decade ago.

In fact, looking at Indonesia’s recent domestic accomplishments, what the country has achieved is nothing short of outstanding. After the fall of Suharto’s New Order regime in 1998, many analysts predicted that the country was standing at the end of a precipice, posed to tear itself apart in much the same way as the terrible ethnic conflicts that ravaged the former Yugoslavia. Without a doubt, this was a distinct possibility. With a vast sprawling archipelago of more than 17,000 islands; hundreds of ethnic and linguistic groups, speaking over 300 unique local languages; multiple religious sects; and a huge population, estimated at just over 200 million in 1998, keeping sectarian and ethnic conflict at bay would be a challenge at the best of times. Yet during this tumultuous time, Indonesia was facing political and economic instability, sparking armed separatist rebellions in Aceh and Papua, and secession from Indonesia by the East Timorese in 1999. National disintegration and large-scale ethnic conflict were more likely than not.

Yet Indonesia managed to navigate its way through this turbulence, emerging as a multi-party democracy with a directly elected president in 2004. The country reformed its institutions, rapidly decentralized its governance structure, and came out the other side with its sovereignty intact. A remarkable feat to say the least. Today, democratic institutions and political stability reassure consumers and attract investors; the streets of Jakarta look a lot more attractive than the streets of Bangkok right now.

China’s economy grew 7.7% in 2013 because Beijing got nervous and started juicing

January 20, 2014

China rolls out yet another shiny GDP number. 

China is the only major economy in the world to set a hard target for economic growth, and the latest GDP figures released today show precisely why it’s a bad idea.

Fueled by a huge surge in government “mini-stimulus” lending in the second half of the year, China’s GDP increased by a higher-than-expected 7.7% for 2013 (link in Chinese) according to the National Bureau of Statistics. That might sound like a good thing, but it’s not: essentially the government freaked out at the prospect of missing its 7.5% target, and overshot the mark.

The consequences—especially for China’s attempts to reform its economy and limit the amount of debt that its businesses and local governments are taking on—could be ugly.

Here’s a look at how 2013 stacked up:


What does this mean for 2014? First off, the quarterly data that the NBS releases suggests that the government will need to juice the economy again if it’s to hold steady at the current rate.

China records its GDP by comparing it with the previous year and adjusting that for inflation. However, the way that most major economies measure growth—by comparing output against the previous quarter, adjusting it for seasonality and projecting what annual growth would look like at that rate—captures growth momentum more effectively. Here’s what that looks like:


As you can see, momentum slowed somewhat in Q4, as the effects of the stimulus wore off and, possibly, as lending hit a seasonal lull in December. “Growth momentum is clearly weakening,” Credit Agricole analyst Dariusz Kowalczyk told Bloomberg. “The slowdown became increasingly clear as the quarter progressed.”

In order to make sure this year’s growth comes in anywhere close to 2013 target, the government will need to roll out a new stimulus and keep credit growth booming. That encourages businesses to pile on more debt—which is really dangerous for a country that’s already shelling out 39% of its GDP to pay off interest on existing debts.

Because of the distortions created by stimulus spending, many economists believe China’s investment is increasingly flowing into projects—or even worse, into real estate—that aren’t profitable. The cost of creating overcapacity is slower growth in the future. The government might not allow a much lower rate of GDP growth in 2014 (we’ll have to wait until the government holds its big annual meeting in March to find out what this year’s target is). But it has to happen eventually—and the sooner, the better.

China’s Shadow Banking Challenge

As the government attempts to rebalance the economy, it will face testing moments in the shadow banking sector.
January 20, 2014

It is becoming clear that, as in 2013, the defining word for China this year will be “reform.” Yet if 2013 was a year for much talk and less actual implementation, 2014 is already shaping up differently. For the financial system, in particular its shadow sectors, this year will be a tough one. Inherent risks from slower growth and restructuring policies combined will test the system and its leaders.

Whether through the story of a dramatic rise in local government debt; several bubbly local real estate markets; the problem of non-performing assets (including local government debt) being rolled over, disguised or otherwise hidden; the increasingly frequent spikes of interest rates in China’s interbank lending market; or the questions surrounding “wealth management products” and the “shadow banking system” – it is the Chinese financial system that lies at the true heart of much that is being targeted for change in the country.

Indeed the financial system has emerged as both one of the main causes and significant results of the distortions that have been developing in China’s economy. Compared to hukou reform, or changes to ownership rights affecting rural residents, the financial system reforms are more difficult, potentially more disruptive, and arguably very urgent.

The People’s Bank of China (PBOC), led by reformer Zhou Xiaochuan, has taken a leading role in driving the financial reform process in China in recent years. However, the central bank, along with reformers on the State Council, the other financial regulatory institutions, and upper levels of party-government, are constrained by some hard truths that lead to sometimes contradictory-seeming policy decisions.

To put the issue simply, the large build-up in debt levels in China – total debt including the central government and its ministries, local governments and corporate debt (both state owned and private) is now over 200 percent of GDP – combined with falling growth rates, mean that the economy is on an unsustainable path. The increasing amounts of credit required to deliver GDP growth suggest that, indeed, investment has been too high for too long, and has been increasingly misallocated as the projects with strong returns have been depleted as targets.

Data released January 15shows that China’s credit growth moderated during 2013. Total Social Financing (TSF), which attempts to include elements of the “shadow banking” system, grew by “only” 9.1 percent in 2013 – still ahead of GDP growth. Broad M2 money supply increased 13.6 percent at the end of December compared to the previous year, while the total stock of outstanding loans grew by 14.1 percent.

To a certain degree, even with the decreases last year, China has walked (or perhaps run) into a debt trap. How? In short, easy credit and liquidity has become increasingly necessary to keep growth ticking over. Now a serious tightening would force many entities into financial distress, and a “subprime” moment could be reached: If liquidity levels were suddenly restricted, then interest rates would rise, resulting in a spike of debt servicing costs. Growth rates would collapse as corporate distress spreads throughout the economy. Contagion throughout the formal and “shadow” financial systems would be a risk.

Is the New York Times Biased?

Published on The National Interest (http://nationalinterest.org)
January 21, 2014

Let’s play a little game. We’re going to imagine three scenarios that could play out in American politics, and then we’re going to discuss which one of the three is best suited for a feature-length movie, staggering amounts of media attention, and particularly upset New York Times editorials. And then we’ll see if the world works the way we think it does.

Scenario 1: A prominent politician with a national reputation and presidential ambitions oversees a tax collection agency that uses the power of the federal government to target core supporters of the opposition in the run-up to an election, keeping them from organizing, fund-raising, and educating, violating their constitutional rights and potentially changing the outcome of an election that could bring propel him to the presidency for four more years. His response: he appoints a prominent campaign donor to investigate the scandal.

Scenario 2: A prominent politician with a national reputation and presidential ambitions oversees an agency that is found to have failed to provide sufficient security to diplomats overseas by a bipartisan report of the Senate Intelligence Committee, resulting in the first murder of a U.S. ambassador in decades. Her response: “What difference, at this point, does it make [3]?”

Scenario 3: A prominent politician with a national reputation and presidential ambitions oversees an agency that shuts down several highway lanes to punish a political opponent, resulting in increased congestion. His response: he fires some of his closest aides, apologizes incessantly, and collaborates with aggressive inquiries of the traffic trouble.

First, the feature-length movie. Federal bureaucrats interpreting the tax code and possibly affecting election outcomes, while not actively stuffing ballot boxes, does not a blockbuster make. We could throw in some romance, but in the absence of whistleblowers there is really not much here in terms of drama. A terrorist attack that leaves four Americans dead, with personal heroism in the face of an enemy and an unresponsive bureaucracy -- yes, that is much better material. The screenplay basically writes itself. And it is certainly better movie material than the story of a traffic jam in a state without known zombie attacks.

Reassuringly, the powers that produce movies agree. HBO, the cable network, has started working on a movie about the attack in Benghazi, based on the New York Times bestseller Under Fire: The Untold Story of the Attack in Benghazi.

China’s Economy Is Slowing, and We Should All Be Thankful

And don't expect a pickup anytime soon
Jan. 20, 2014

China's President Xi Jinping during a welcoming ceremony at the Great Hall of the People in Beijing on Nov. 13, 2013

Few statistics are more closely watched by policymakers, economists and businessmen from New York to Tokyo than China’s economic growth rate. What happens in the world’s second largest economy, after all, influences the market for everything from iron ore to automobiles to Prada bags, and companies from General Motors to Starbucks are counting on China to generate more and more of their future profits.

That’s why Monday’s announcement of yet another lackluster economic performance struck investors hard. China’s GDP grew 7.7% in 2013, roughly matching the pace in 2012. To Western eyes, where growth of 2% is considered an achievement these days, China’s numbers may still inspire awe and envy. But consider that China has routinely topped 10% growth a year since the 1980s. The recent patch of growth is the slowest the nation has experienced since the late 1990s. On the surface, that may appear a bad thing. China’s steady growth through the Great Recession helped prevent the entire global economy from slipping into an even more destructive downturn.

But in fact, we should all welcome a slower China. The fact is that the economy was starting to resemble a breakaway train, chugging toward that unfinished bridge just over the horizon. Debt has been piling up to dangerous levels, industry is burdened by excess capacity, and the financial sector has been taking on bigger risks as a result. The country’s growth model, led by heavy doses of investment in stuff like factories, roads and buildings, has begun to run out of steam, able to produce eye-popping growth rates only with greater and greater infusions of credit. Fears have been mounting that China could suffer a financial crisis like the one that tanked Wall Street in 2008. That would threaten the stability of the entire global economy.

China has to slow down — for its own good, and ours. To his immense credit, President Xi Jinping and his team have realized this. He has resisted the temptation to use the machinery of the state to pump up growth, as his predecessors had done. Instead, Xi has embarked on a renewed, forward-looking effort to liberalize China’s economy. In a bold reform package unveiled in November, Xi has committed the government to opening up financial markets, improving the management of inefficient state-owned enterprises and expanding the power of the private sector. If he holds to his promises, the Chinese economy could emerge (over time) healthier and more market-driven, which would lay the foundation for further growth.

The P5+1 and Iranian Joint Plan of Action on the Islamic Republic of Iran’s Nuclear Program: Assessing the Details and Risks

JAN 17, 2014

Until now, there has been no clear official statement regarding the technical understandings that the P5+1 and Iran reached on the Implementation of the Joint Plan of Action on the Islamic Republic of Iran’s Nuclear Program on January 12, 2014. A White House fact sheet was issued on January 16, however, that changes this situation and provides a far more detailed outline of exactly what the understanding agreements reached by the P5+1 (the United States, United Kingdom, Germany, France, Russia, and China, coordinated by EU High Representative Catherine Ashton) and Iran were.

The Necessary Limits to Transparency

It is important to understand that such statements do have severe limits. The political issues involved in setting clear limits to Iran’s programs are so sensitive – particularly for Iran – that all of the details on inspection and verification are not going to be publically disclosed, and there are almost certainly a number of important mutual “understandings” that will not be put in writing. This is a necessary aspect of such sensitive negotiations, but it is important to note that the White House factsheet and outside reporting on the negotiations indicate these involved trade-offs which put additional limits on Iran’s capability to actually develop and build a nuclear weapon in returning for giving Iran a continuing right to enrich uranium to the levels needed for nuclear power reactors and carry out other forms of nuclear research.

What is far more important to understand, however, is that any agreement of this kind conceals a far more important dimension. Its validity depends heavily on an intelligence duel in which the United States and its allies – with limited exchanges with the EU, IEA, China, and Russia – attempt to fully assess every aspect of Iran’s actions, intentions, and capabilities to develop and deploy nuclear weapons. Iran, in turn, has every incentive to conceal any activity relating to nuclear weapons in any form, and any data that would lead to additional limits and inspections on its nuclear programs, as well as other activities that are not related to nuclear weapons as a matter of both security and sovereignty.

Not Losing the Arab Awakening

Marwan Muasher Op-Ed January 21, 2014 Foreign Policy 

There are no short cuts to democracy or prosperity. The Second Arab Awakening has only just begun, and the end may not be known in this generation’s lifetime.When a Tunisian peddler set himself on fire in December 2010, launching the Second Arab Awakening, many were taken by surprise. While I cannot claim prescience, I did have a powerful sense that we had been there before -- and that if we did not learn the lessons of the past, we would fail this time as well.

Those fears proved well founded. One transition after another has struggled or failed to produce governments that can respond to citizens' longing for freedom and opportunity. The fragility of the once-promising Arab transitions clearly shows the urgency of beginning the painstaking process of constructing an Arab world defined by pluralism and tolerance. Only then can what I call The Second Arab Awakening and the Battle for Pluralism be realized.

which began in the mid-19th century, can be illuminating. That awakening took the form of an intellectual revolution in which a wide array of Arab thinkers started questioning the control of distant Ottoman despots over their nations and criticizing their own limited contact with the outside world. Their calls for intellectual, economic, and political change laid the groundwork for a new Arab world, eventually resulting in a wave of independence struggles in the 1940s and 1950s.

Ultimately, however, the first Arab Awakening fell short of the aspirations of many of those who inspired it. In the end, colonial autocracies were replaced with domestic ones -- often military-backed single-parties that took advantage of their revolutionary legitimacy to cement their grip on power. New regimes paid little attention to developing political systems whose checks and balances guaranteed access for all. They saw pluralism as a potential threat and took heavy-handed measures to prevent its realization. 

That rejection of pluralism doomed the Arab region to decades of political failure. Unrealized political and economic expectations, the failure to solve the Palestinian issue, and the unwillingness to provide good governance marked the post-independence era in the Arab world. For years, the only groups that contended with the ruling elites were those whose organizing principle was religion. Political Islam emerged as the only alternative to one-party rule. Abuses by government personnel, especially the security and intelligence services, and wealth concentrated in the hands of a few kept tensions seething just beneath the surface.