10 December 2014

Electrifying truths - Banks may collapse because of power sector indiscipline

S.L. Rao 

P.V. Narasimha Rao, before he became prime minister, read all the reports by L.K. Jha and the economists employed at the World Bank, about what must be done to put Indian economy on the growth path. As prime minister, he came with a clear vision of goals and how to reach them. The reforms that followed transformed the Indian economy.

A report reviewing the Indian power sector written by the Indian economists, Sheoli Pargal and Sudeshna Ghosh Banerjee, at the World Bank, has the potential to transform the Indian power sector. The energy sector in India has been dominated by welfare ideology, poor implementation, inefficient institutional mechanisms, rampant populism, bureaucratic capture and compromises. The ideology is that State ownership is honest and more concerned about consumer interests. There is an unwillingness to accept that producing a surplus is important for any investment in order to provide sustained good service and to build more capacity. A preference for charity given to disadvantaged groups rather than opportunity has dominated the sector. Tariffs are skewed to favour the poor and needy groups like those under agriculture, but with no mechanism to ensure that the needy are properly identified. The State-owned electricity boards and others owning coal and gas function as government administrations. Independent regulatory mechanisms, created to insulate the sectors from political interference, are captured (like the State enterprises) by the top level bureaucracy. They function largely in compliance with government wishes. There is little financial discipline: the enterprises amass huge debts paid for by governments and are a burden on nationalized banks.

Government ownership (and guarantees) of banks has hidden the reality that this burden is excessive. It will lead to collapse or require their huge recapitalization by government. That will affect adversely the government's ability to build physical and human infrastructure and raise its deficit.

For a warmer Russian bear hug

Srinath Raghavan

New Delhi may be gearing up to roll-out the red carpet for Russian President Putin but if the relationship between India and Russia is not to flounder in the near future, it needs a sense of purpose and momentum

The symbolism of the moment was unmistakable. The new Indian Prime Minister was whisked to the head of a long queue of waiting foreign dignitaries and introduced to the Russian leader. The first handshake between Rajiv Gandhi and Mikhail Gorbachev — at Konstantin Chernenko’s funeral in March 1985 — said a great deal about the strategic relationship between their countries. As President Vladimir Putin arrives in India, Moscow and New Delhi should recall that meeting.

Then, as now, leaders on the top were keen to strike a personal rapport and emphasise the significance of their ties. Didn’t Prime Minister Modi tell Mr. Putin that “every child in India knows that our closest friend is Russia?” Yet, a couple of years after the warm encounter between Rajiv Gandhi and Mikhail Gorbachev, bilateral relations were turning cold. This was largely because the two countries were unable to calibrate their ties in a time of change. To be sure, the situation today is very different from the late 1980s. Still the relationship between New Delhi and Moscow needs a sense of purpose and momentum, if it is not to flounder in the near future.Ukraine crisis

Mr. Putin’s visit comes against the backdrop of a challenging strategic and domestic context. The crisis in Ukraine continues to simmer. Contrary to accusations of Russian “revanchism” or “imperialism,” the evidence suggests that Mr. Putin was taken unawares by the events leading to the overthrow of Viktor Yanukovych. His subsequent moves to annex Crimea and support rebels in eastern Ukraine were aimed at preserving Russia’s security interests. The Russian President is being no more — or no less — hypocritical than the United States when he couches his actions in the language of humanitarianism or religious piety. This is how great powers behave.

Uber’s constant overreach

Stephan Richter

APATTITUDE PROBLEM: "Whenever companies like Uber argue that they are prenaturally above the law, it demonstrates exactly the type of hyper-arrogance which much of the world has come to expect from U.S. businesses." Picture shows smartphones displaying Uber car availability in New York.

India is not alone in battling the U.S. app phenomenon

Don’t get me wrong. Real innovations are important — and increasingly hard to come by. In a never-ending flood of app offerings created in Silicon Valley, Uber seems to be one of the few based on a really good idea.

Unfortunately, the way in which Uber is doing its business is more reminiscent of the operating style of the George W. Bush administration in Iraq and elsewhere. He was famous for the “invade first, ask questions later” model.

National laws don’t apply to us.

The most breathtaking element of the Uber standard operating formula is to argue, as the company’s top executives regularly do, that no laws apply to the company. Why? Because, get this, the sharing economy wasn’t invented yet when the relevant laws and regulations for taxicabs were written. Ayn Rand, the godmother of all libertarians in America, must feel like resurrecting herself in excitement.

Russia-Pakistan ties in India’s long-term interest: Putin

Suhasini Haidar

PTIA file photo of Narendra Modi and Vladimir Putin

Russian President to reach India today for annual summit

Russia’s cooperation with Pakistan will serve the “long-term” interests of India, says Russian President Vladimir Putin, who is set to land here on Wednesday for the annual India-Russia summit.

Responding to questions submitted by The Hindu, Mr. Putin also said the scope of the agreement signed last month, which was the first of its kind between Russia and Pakistan, is limited. “[Regarding] Pakistan, we have held talks on Russia’s possible assistance aimed at improving the counter-terrorism and anti-drug operations. In my view, this kind of cooperation serves the long-term interests of all countries of the region, including India,” he said.

Brushing aside concerns that the cooperation would lead to a shift in India-Russia ties, or that India’s growing military closeness to the U.S. was “transforming” bilateral ties, he replied: “If some transformations take place, it would be a completely different kind of transformation. The high level of bilateral cooperation and trust allows us to start a gradual transition from the traditional producer-consumer model to joint development and production of advanced weapons systems,” he added, referring to the co-developed Brahmos missile as well as the fifth-generation fighter aircraft.

Mr. Putin, who will hold meetings on Thursday with Prime Minister Narendra Modi, will also meet President Pranab Mukherjee and Vice-President Hamid Ansari, hopes to see some “significant achievements” from these meetings. He listed nuclear energy cooperation as a “pillar of the India-Russia strategic partnership.” He hailed the Kudankulam plant built by Russia as the “world’s only nuclear power plant which meets all the “post-Fukushima” safety requirements.”Site for nuclear plant

A ‘Galle-ing’ experience

Dec 09, 2014

Arun Prakash

Instead of merely moaning about China’s ‘string of pearls’ and ‘maritime silk route’ strategies, India needs to craft creative, dynamic and long-term maritime alternatives

December 26, 2004, Sunday morning, saw the calm in Naval Headquarters (NHQ) being shattered by ominous reports of powerful seismic shocks and giant tidal surges in our Bay of Bengal islands and coastal areas. As the first Indian Navy (IN) warships and aircraft were being despatched on relief missions, appeals for assistance started coming from Sri Lanka and the Maldives. Having assigned resources to cope with the domestic emergency, NHQ considered it equally imperative to rush aid to stricken neighbours.

Given the languid functioning of our bureaucracy, a proposal of this nature could have taken weeks or months to be processed by the ministries of defence, external affairs and finance. To one’s utter amazement, the national security adviser (NSA) accorded instant approval on the phone, with the words, “We will sort out the paperwork on Monday”. Eighteen hours later, citizens of Galle on the southern tip of Sri Lanka awoke to see Indian warships, laden with relief material, anchored off the devastated harbour.

Fast-forward to December 1, 2014 — a decade. I arrive in this picturesque port town for the Galle Dialogue, to be told by a Sri Lankan admiral, “People in Galle remember the tsunami. If you tell shopkeepers that you are from the IN, they will not let you pay.”

Initiated by the Sri Lankan ministry of defence in 2010, the annual Galle Dialogue has gained in significance and momentum with 38 nations, spanning the full alphabet from Australia to Zambia, represented at its fifth edition. India was given due prominence and the printed programme showed Dr Ajit Doval, India’s NSA, as guest of honour and keynote speaker, with the first two sessions being chaired by Indians; one of them being the vice chief of naval staff (VCNS).

The NSA’s oration on regional maritime security issues was heard with rapt attention and drew applause as he, tactfully, mentioned the early contributions of Sri Lankan statesmen towards creating an Indian Ocean zone of peace. The anti-climax came when it was discovered that the Indian VCNS had not arrived on the expected flight. The hosts, too polite to pose awkward questions, quietly found a substitute to chair the session. The Galle Dialogue 2014, thus, saw participation by the commander of the Pakistan Fleet, the deputy Chief of Staff of the PLA Navy (PLAN) and a dozen other flag officers, but the IN invitee was absent; leaving many questions hanging in the air.



Wednesday, 10 December 2014 | Ashok K Mehta |

While India-Pakistan tensions clouded Saarc proceedings, the Chinese were active — being pushed for their elevation from an observer to a dialogue partner by Islamabad. China influences the commercial quarters

One country where the ‘neighbourhood first’ policy and Modi magic are working is Nepal. Returning from the Dhulikhel retreat during the recent Saarc summit to Soaltee Hotel, Prime Minister Narendra Modi put his security staff in a tizzy by stopping the car near Kalimati, plunging into the crowd and pumping hands with eager bystanders. “Modi Sir has really captured our hearts and minds!” said Gopaldai, my driver and political guide in Kathmandu. As the nearly-failed Saarc summit became a side event for Mr Modi and his team, the India-Nepal bilateral stole the show with a dozen pacts being signed. Six months of the Modi Government have been a transformational period; Mr Modi indicating that Nepal is India’s lead country. Gopaldai figures that what could not happen in 60 years is unfolding in just six months. The process of removing misperceptions, addressing grievances and addressing differences has begun. Though Sanju Upadhyaya in his book, Raj Lives On, and CK Lal in his column have said to the effect that whoever rules Nepal has to secure India’s blessings and be cognisant of its legitimate security concerns, the new relationship is only evolving. Willy nilly, Kathmandu is using the Beijing card subtly.

The second visit by Mr Modi developed hiccups over his proposed visit to Janakpur, Lumbini and Muktinath. Not only were there differences within the Koirala Cabinet, expressed notably by Foreign Minister Mahendra Bahadur Pandey, on Nepal’s TV24 but also certain discomfort egged on by China was apparent. Still, a surfeit of agreements ranging from Upper Karnali and Arun III hydel projects being awarded to GMR and Satluj, and the funding of the line of credit of $1 billion to permitting use of Rs1,000 and Rs500 currency notes which had created havoc at border crossings, and road and rail connectivity overshadowed the cancellation of the Janakpur visit which disappointed many Madhesis. The power trade agreement, the first with any country, resulted from eight rounds of inter-ministerial dialogue. For the Motor Vehicle Agreement, 21 routes have been found commercial; power transmission lines been upgraded to enhance capacity from 50MW to 500MW; and pipelines and railway lines are in the works. Above all, Prime Minister Modi’s commitment to respect Nepal’s sovereignty and engage Kathmandu politically are highly lauded.

Five months of life underground

The Statesman
10 Dec 2014
Oliver Carroll

Ilona already knows the sound a bomb makes. The three-year-old is keen to impress she can tell the difference between a mortar and the thud of the trap door, which periodically slams shut above her head.
The other children in the bomb shelter are even more knowledgeable. They know what a “Smerch” rocket is, and how it differs from the smaller “Uragan” and larger “Tochka-U” missiles. The boys explain how the rattle of machine gun fire can be differentiated from mortars, and from rocket launchers.

There are 40 adults and 12 children living in the damp and cramped cellars of 84 Kosareva Street in Petrovsky district in west Donetsk. Three of the children in the bomb shelter are now sure they want to become war journalists. Two are eyeing jobs as soldiers, and one wants to be an aid worker.
This week is an anniversary of sorts for them, marking five months of life underground.

Their home in Petrovsky is the last settlement before a buffer zone between rebel-controlled Donetsk and its suburb Marinka, which has been seized by government forces. The district is one of the most dangerous in all Ukraine. Almost half of the concrete residential blocks have been damaged. It remains too risky to spend long periods above ground. Nearly all the adults in the shelter have stories of a friend or relative dead or maimed. And all understand their temporary home offers little protection in the case of a direct hit.
Natalya Leonidovna, 59, tells The Independent that her sister and husband had been killed during fierce fighting in August. “Life is not without difficulties down here, but it gives us the best chance of staying alive,” she says. “My sister and her husband died: all they did was go out into the courtyard, and it was wrong place and wrong time.”

Caste matters, despite the great Indian lie

Amrit Dhillon
Dalit women remain discriminated against, despite calls to end positive discrimination in their favour. Photo: Pawan Kumar / Reuters

So the lie so beloved of the Indian elite – that the caste system is moribund and no one bothers about anyone’s caste any more – has been nailed.

The largest survey ever to look at caste attitudes has been carried out by the National Council for Applied Economic Research in New Delhi and the University of Maryland. It covered 42,000 households across the country and across religions.

Asked if they practised untouchability in the sense of not allowing a low caste person to enter their kitchen or touch their dishes, 30 per cent of Hindus and 52 per cent of Brahmins admitted they did. Even Sikhs (23 per cent) and Muslims (18 per cent), whose religions are meant to be free of caste, practise untouchability. Only Christians had a relatively low figure of five per cent.

For many years, the middle classes have attacked India’s affirmative action policy for Dalits, formerly known as untouchables. They say that the quotas for Dalits in college admissions and government jobs are unnecessary because this policy has empowered Dalits sufficiently by now and discrimination on the basis of caste has disappeared. They argue that merit should be the only deciding factor.

The irony that those who have ruled India for centuries on the basis of birth are now keen to honour the principle of merit is lost on them.

“They can’t go on being pampered” is the refrain often heard in India. The reality is that violence, rape, and humiliation are inflicted on Dalits all the time, particularly in rural areas.


By William T. Wilson, Ph.D.

In the coming years and decades, the strategic interests of the United States and India are highly likely to become increasingly intertwined. Both sides want democracy to spread and thrive, and both seek to contain terrorism and counterbalance the downside security risks in the rapid rise of China. Stronger economic ties are essential to developing a relationship that is deep and resilient enough to support these objectives.
Growing Bilateral Trade

Making the most of U.S.–India trade and investment linkages has not been easy. Until the early 1990s, India’s economy was closed. Average tariffs exceeded 200 percent, non-tariff barriers were extensive, and foreign direct investment (FDI) was largely blocked.

Economic liberalization in 1991 changed this. India’s ratio of bilateral trade to gross domestic product (GDP) has increased from 15 percent in 1990 to 53 percent in 2013. Average non-agricultural tariffs have fallen below 15 percent, quantitative restrictions on imports have been largely eliminated, and foreign investment norms have been relaxed in a number of sectors, such as defense, auto parts, and insurance. As a result, despite some continuing trade frictions, total trade in goods and services between the U.S. and India has grown fivefold since the turn of the century to approximately $100 billion.
Trade Friction

Although India has steadily opened up its economy, the 2014 Index of Economic Freedom,[1] published by The Heritage Foundation and The Wall Street Journal, ranked India a dismal 142nd in both trade freedom and investment freedom. India’s average tariff rate is 7.2 percent, and non-tariff barriers, including tariff-rate quotas on corn and dairy imports, have driven up domestic prices. At 30 percent to 40 percent, India’s average agricultural tariffs are among the highest in the world.

India’s staggering wealth gap in five charts

December 8, 2014 

How does inequality in India really look? How much share does the country’s poorest 10 per cent have in its total wealth, how much does the richest, and are the rich getting richer?

We’ve been able to answer some of these questions from new estimates that came out of Credit Suisse’s Global Wealth Databook 2014.

For one, the difference in the wealth share held by India’s poorest 10 per cent and the richest 10 per cent is enormous; India’s richest 10 per cent holds 370 times the share of wealth that it’s poorest hold.

India’s richest 10 per cent have been getting steadily richer since 2000, and now hold nearly three-quarters of total wealth.

India’s 1 per centers – its super-rich – have been getting richer even faster. In the early 2000s, India’s top 1 per cent held a lower of share of India’s total wealth than the world’s top 1 per cent held of its total wealth. That changed just before and after the global recession – though the world’s super-rich are recovering - and India’s top 1% holds close to half of the country’s total wealth.

Not surprisingly, India then dominates the world’s poorest 10 per cent, while China dominates the global middle class and the United States the world’s rich.

The world’s super-rich – the top 1 per cent – is overwhelmingly American. Indians make up just 0.5 per cent of the world’s super-rich.

Senate Report Says Water boarding Did NOT Help CIA Find Bin Laden

Charlie Savage and James Risen
December 9, 2014

Senate Report Disputes C.I.A. Claims on Hunt for Osama bin Laden

The aftermath of the raid that killed Osama bin Laden in Abbottabad, Pakistan, in 2011. Credit Warrick Page for The New York Times

WASHINGTON — Months before the operation that killed Osama bin Laden in 2011, the Central Intelligence Agency secretly prepared a public relations plan that would stress that information gathered from its disputed interrogation program had played a critical role in the hunt. Starting the day after the raid, agency officials in classified briefings made the same point to Congress.

But in page after page of previously classified evidence, the Senate Intelligence Committee report on C.I.A. torture, released on Tuesday, rejects the notion that the agency would not have found Bin Laden if it had not tortured detainees.

“The vast majority of the intelligence” about the Qaeda courier who led the agency to Bin Laden “was originally acquired from sources unrelated to the C.I.A.’s detention and interrogation program, and the most accurate information acquired from a C.I.A. detainee was provided prior to the C.I.A. subjecting the detainee to the C.I.A.’s enhanced interrogation techniques,” the Senate report said.

It added that most of “the documents, statements and testimony” from the C.I.A. regarding a connection between the torture of detainees and the Bin Laden hunt were “inaccurate and incongruent with C.I.A. records.”

On Tuesday, the C.I.A. disputed the committee’s portrayal that it had been misleading and disingenuous about the role of that program in the hunt for Bin Laden.

The crucial breakthrough in the hunt was the identification of the courier, known as Abu Ahmed al-Kuwaiti, who served as the terrorist leader’s link to the outside world from his secret compound in Abbottabad, Pakistan. His significance gradually came into sharper focus.

But the Senate report shows that the C.I.A. was already actively collecting information about him earlier than was previously known and long before it had obtained any intelligence about him from detainees in its custody.

The United States had started wiretapping a phone number associated with Mr. Kuwaiti by late 2001, and as early as 2002, the C.I.A. had obtained from other sources — including reports from allies based on detainees in their custody — the courier’s alias and the fact that he was one of Bin Laden’s few close associates and “traveled frequently” to meet with him. It also had data on his age, physical appearance and family connections, as well as a recording of his voice — all of which would later prove crucial to finding him.

Afghanistan, We Hardly Knew You


It took more than a dozen years for the Afghan and NATO forces to really understand each other, but all that will soon be history. 

KABUL, Afghanistan — One of the first things you notice at an Afghan National Army training base is that there are roses everywhere. There are lovingly tended flower beds along each road and surrounding every barrack. The machismo of Afghan male culture apparently coexists with a little-noted passion for gardening. Not only are the center dividers of Kabul’s traffic-choked main avenues lined with well-kept rose bushes, but when you stop at checkpoints in the capital’s “Ring of Steel” you often see brightly colored flowers growing out of the top of Hesco barriers, the giant blast-proof sandbags that are one of the transforming technologies of the “War on Terror.” 

It’s the sort of juxtaposition that makes you wonder, when you first see it, whether the ways of the Afghan soldiers and those of the Westerners who’ve trained them can ever really fit together. And the announcement Saturday that the United States will be keeping an extra thousand troops on the ground in Afghanistan for a little longer than planned—a total of 10,800 troops in the first few months of the new year—makes the question seem just a bit more critical. There have been so many stories of “green on green” and “green on blue” killings, when Afghan soldiers and police have opened fire on their fellow troops or their Western colleagues in ISAF, the International Security Assistance Force. 

But the blast barriers themselves, like the roses, are so ubiquitous that once you’ve spent some time here you forget to register them or what their presence may imply about how people and institutions deal with the ordinary insecurity of life. The same applies to other visual cues that tend to go unremarked. 

“What if? Strategic Techniques in a Decade of Conflict”

“What if? Strategic Techniques in a Decade of Conflict”

The Bridge is proud to host this week’s installment of CCLKOW, a weekly conversation on military affairs jointly hosted by the Center for Company-Level Leaders at the US Military Academy at West Point and the Kings of War, A blog of the Department of War Studies, King’s College London. I’m even more thrilled to host a piece by a great friend and mentor, Dr. Antulio Echevarria, II.

Here’s a note from one of the moderators, Jill S. Russell: “This week we are talking strategy. Considering the recent experience of conflict in Iraq and Afghanistan, Echevarria posits a critical deficit in linking strategic techniques and military operations. Unfortunately, the weakness he identifies rings true. However, the good news is that every error is an opportunity to learn. Read the post and join the discussion on Twitter #CCLKOW.”

When the campaign in Afghanistan began in late 2001, coalition military strategy was essentially one of ‘decapitation’ in that it aimed at capturing or killing bin Laden and other high-ranking al Qaeda and Taliban figures. It also had a ‘divide-and-conquer’ or ‘enemy-of-my-enemy’ character in the sense that CIA and special forces personnel, armed with ‘drones and dollars,’ worked to leverage Northern Alliance and various Pashtun tribes against bands of al Qaeda and Taliban. By the end of December 2001, coalition military strategy had essentially settled into to a ‘search-and-destroy’ pattern, which culminated in the killing of bin Laden on May 2, 2011. It had also acquired a ‘clear-hold-build-and-transfer’ character, particularly after 2010 when a troop-surge took place similar to the one carried out in Iraq in 2007. Meanwhile, ‘decapitation’ and attrition-style ‘targeted killing’ strategies continued, incorporating some areas of Pakistan. In some respects, the constant shifting of coalition military strategy and the concurrent implementation of different strategic techniques that accompanied it were driven by the need to respond to changing situations on the ground.[1] In other respects, this meandering reflects what typically happens when one has no overarching grand strategy in place to keep rising costs in line with anticipated gains. In still other respects, though, it highlights something of crucial importance to the military practitioner — how valuable the knowledge of strategic techniques is.

Coalition forces had to discover the merits and demerits of strategic techniques like ‘divide-and-conquer’ or ‘enemy-of-my-enemy’ through costly and time-consuming trial and error. That they did so is a credit to their skill and adaptability. However, the loss of time and the rising costs involved in learning by trial and error played into the hands of what might loosely be called a ‘strategy of exhaustion’ on the part of al Qaeda and the Taliban. In such cases, the frictions and inefficiencies in one’s own system can play as important a role, if not more, as the strategic efforts of one’s foe.

Army is fighting a war, and not terrorism, in J&K

December 8, 2014

For the past six months Pakistan is using the Lashkar-e-Tayiba and other terrorist groups to launch frontal attacks on Indian security forces and assets instead of aimlessly targeting civilians. The sooner all of us understand this, the better it is.

The last three attacks on Indian assets -- one in Afghanistan and two in Jammu and Kashmir -- are a clear demonstration of Pakistan's last throw of dice in sending highly-trained and motivated fidayeen to specifically target the Indian Army and other security forces.

The first instance took place three days before Narendra Modi was to be sworn in as prime minister on May 26. The target was India's consulate in Afghanistan's Herat.

A Lashkar-e-Tayiba hit squad was assigned to take hostages and lay siege at the Indian consulate. The LeT hit-squad, highly trained, heavily armed and intensely motivated, seemed to have come prepared for a long haul. Security sources said each of the four attackers carried AK-47 rifles and six magazines each.

Two of them also carried under barrel grenade launchers or UGBLs and rocket propelled grenades or RPGs. Each also carried fruits, nearly half a kg of dry fruits and water bottles.

The Herat attack and the last two attempts to push in terrorists into the Kashmir valley have uncanny similarities. In both the attacks last week, terrorists had come equipped for a prolonged fight and were eventually prepared to die.

This is a new breed of fidayeen Pakistan has invested in.

On the night of December 1, half a dozen terrorists tried to infiltrate the Tootmari gali in the Naugam sector at an altitude of 14,000 feet. The army killed all six and recovered huge 'war-like' stores right on the Shamshabari range.

China's Grand-Strategy Challenge: Creating Its Own Islands in the South China Sea

December 8, 2014 

China’s grand strategy in the South China Sea seems pretty clear—change facts in the water. 

Satellite images analyzed by defense intelligence magazine IHS Jane’s show that China is reclaiming on Fiery Cross Reef in the Spratly Islands a piece of land that bears the shape of a 3000-meter airfield and a harbor large enough to receive tankers and major warships. This is not the first, but the latest in a series of land reclamations that China is conducting both in the Spratly Islands and the Paracel Islands in the South China Sea.

What does China want with this island building? What is the ultimate objective of these projects? The usual lens we use to decipher strategic moves on the international arena is ill suited to answer these questions. It views the game nations play in term of chess, but China is playing weiqi in the South China Sea.

Weiqi, better known in the West by its Japanese name, go, is the oldest Chinese board game that bears much parallel to an influential branch of traditional Chinese strategic thinking. While chess is a game of checkmate,weiqi, as its very name tells us, is a game of encirclement. In weiqi, there are no kings, queens or pawns as there are in chess, only identical stones whose power depends on where they are in the larger arrangement of the pieces. If chess is a contest of armies, weiqi is a struggle between configurations. Whereas the competent chess player aims at the destruction of the enemy’s physical power, a proficient weiqi player strives for the control of strategic positions, from which position-based power emanates.

If the South China Sea is seen as a chessboard, China’s moves in it appear largely trivial. Advanced forward are mostly pawns, while there is little movement of the more powerful figures. Perhaps the most formidable piece on the board is an underground base for nuclear missile submarines at Yulin on the southern coast of Hainan Island. However, this base is not located in the disputed areas. The main forces involved in the South China Sea dispute are rarely the military, but predominantly fishing boats and lightly armed government vessels. And the central objects of the contest are tiny, barren, often-submerged rocks.


By Bhaskar Roy

The announcement of Indian National Security Advisor (NSA) Ajit Doval as the Special Representative (SR) of India for the India-China border talks was welcomed by China. Chinese foreign ministry spokeswoman Hua Chunyin said in Beijing (Xinhua, Nov.25) that with this appointment in New Delhi China expects a new round of border talks with India at the SR level at an appropriate time.

Ms.Hua’s statement was accompanied by the usual platitudes to which no one can have any objection. A solution that is fair, reasonable and acceptable to both sides will result in such an agreement. This will include the much earlier premise of “Mutual Accommodation, Mutual Understanding and Mutual Adjustment” (MUMAMA), reflecting give and take.

Ms. Hua recorded the Chinese position that the undesignated border between the two countries was 2000 kms, and reminded that the two countries “had a border conflict in 1962”.

The Special Representative Structure was set up in 2003, and 17 meetings have been held since. Several agreements and protocols have been signed between India and China starting 1993 (Prime Minister Narasimha Rao’s visit to Beijing). The SR level talks and the agreements may not have resolved the boundary issue, but they have not been futile. The agreements and protocols on the boundary ensured establishment of mechanisms to prevent untoward incidents.

The SR level talks are much wider than the border issue and encompass regional and global developments. This has certainly helped both the sides to appreciate each others’ views on a variety of issues.

With India emerging from the South Asian morass of underdevelopment, its relevance is being felt across the globe. India is a member of the G-20, a member of the Brazil, Russia, India, China, South Africa (BRICS) initiative, and is also being sought in other fora. India’s economic growth and to an extent its defence modernization (or recognizing the importance of four-dimensional defence modernization) are indices that cannot be ignored by the international community.

This is a game changer especially in the context of India-China relations, and Asia and the Pacific region. The Indo-Pacific strategic corridor concept basically summarises the smooth enjoining of the Indian and Pacific Oceans. This conforms to the shrinking of the global balance where a serious disturbance between important or great powers can no longer remain localized.

In this scenario, India and China have emerged as strong trade partners. But unfortunately, there are lacunae which China must resolve, to reach the set target. China has to eliminate or at least reduce the trade imbalance, stop exporting shoddy goods to India, and give Indian products real entry into the Chinese market. Despite liberalization and China’s so-called open markets, it is very well known that important business deals are controlled by the Chinese Communist Party and the Chinese government.

Blinders, Blunders, and Wars What America and China Can Learn

What America and China Can Learn

The history of wars caused by misjudgments, from Napoleon's invasion of Russia to America's invasion of Iraq, reveals that leaders relied on cognitive models, or simplified representations of their worlds, that were seriously at odds with objective reality. Blinders, Blunders, and Wars analyzes eight historical examples of strategic blunders regarding war and peace and four examples of decisions that turned out well, and then applies those lessons to the current Sino-American case. Leaders' egos, intuitions, unwarranted self-confidence, and aversion to information that contradicted their views prevented them from correcting their models. Yet advisors and bureaucracies can be inadequate safeguards and can, out of fawning or fear, reinforce leaders' flawed thinking.

War between China and the United States is more likely to occur by blunder than from rational premeditation. Yet flawed Chinese and American cognitive models of one another are creating strategic distrust, which could increase the danger of misjudgment by either or both, the likelihood of crises, and the possibility of war. Although these American and Chinese leaders have unprecedented access to information, there is no guarantee they will use it well when faced with choices concerning war and peace. They can learn from Blinders, Blunders, and Wars.

As a general remedy, the authors recommend the establishment of a government body providing independent analysis and advice on war-and-peace decisions by critiquing information use, assumptions, assessments, reasoning, options, and plans. For the Sino-U.S. case, they offer a set of measures to bring the models each has of the other into line with objective reality.

Key Findings

Strategic Blunders Can Happen When Leaders Rely on Defective Cognitive Models of Reality and Have No One to Correct Them.

Strategic blunders can result from faulty intuition, egotism, arrogance, hubris, grand but flawed strategic ideas, underestimating the enemy and the difficulties and duration of conflict, overconfidence in war plans, ignoring what could go wrong, stifling debate, shunning independent advice, and penalizing dissent.

These conditions are especially dangerous when combined with excessive risk taking based on an overestimation of one's ability to control events.

The Key to Bridging the Gap Between a Defective Model and Objective Reality Is Information, Amply Supplied and Well Used.

Decisionmakers may be more receptive to information that supports rather than threatens their beliefs, preconceptions, and models.

Institutions close to decisionmakers can be drawn into the same subjective perception of reality.

A Coup Ordained? Thailand’s Prospects for Stability

Asia Report N°263 3 Dec 2014 

On 22 May, for the twelfth time in Thailand’s history, the army seized power after months of political turbulence. This is not simply more of the same. The past decade has seen an intensifying cycle of election, protest and government downfall, whether at the hands of the courts or military, revealing deepening societal cleavages and elite rivalries, highlighting competing notions of legitimate authority. A looming royal succession, prohibited by law from being openly discussed, adds to the urgency. A failure to fix this dysfunction risks greater turmoil. The military’s apparent prescription – gelding elected leaders in favour of unelected institutions – is more likely to bring conflict than cohesion, given a recent history of a newly empowered electorate. For the army, buyer’s remorse is not an option, nor is open-ended autocracy; rather its legacy, and Thailand’s stability, depend on its success in forging a path – thus far elusive – both respectful of majoritarian politics and in which all Thais can see their concerns acknowledged. 

The coup’s stage was set by yet another round of a power struggle between forces allied with former Prime Minister Thaksin Shinawatra and his opponents in the traditional establishment and urban middle class. Thaksin’s sister, Yingluck Shinawatra, who won office in 2011, faced large anti-government protests from November 2013 following an ill-judged bid by her party to pass an amnesty law that would have allowed for the return to Thailand of her brother, in self-exile since 2008. The protesters, sensing the moment, wanted to bring down the government, citing “parliamentary dictatorship”, runaway populism and alleged corruption. Yingluck called a general election, but it was boycotted by the main opposition, subject to disruption and invalidated by the Constitutional Court. In May, the same court forced Yingluck from office for an administrative violation. With the caretaker government hobbled but refusing to resign, the army declared martial law and seized power. 

Yingluck’s ouster and the coup echo earlier rounds of turmoil. Thaksin-affiliated parties have won every general election since 2001, usually in the face of staunch establishment resistance, and none but his first government has been permitted to see out their term. Thaksin showed an authoritarian bent, yet his parties win each time there is a return to the polls. Under these circumstances, the ouster of Yingluck’s government seemed to many – both those for and against it – as almost inevitable. This time, the more active role of the military in government, the intensifying political divide and the impending royal succession create a tightening torque of tension that might prove difficult to roll back.

In seizing power so soon after its last intervention in 2006, and following its involvement in violently quelling 2010 street protests, the military, under General Prayuth Chan-ocha, appears determined to learn from what it sees to have been its past errors. Thus, the ruling National Council for Peace and Order (NCPO) has moved forcefully to repress dissent and looks unlikely to relinquish power any time soon, with talk of October 2015 elections now replaced with vaguer commitments. Further, the interim charter gives absolute power to the NCPO, including amnestying its members for past and future actions. It provides no role for elected representatives or means for popular political participation. The parameters it sets out for the next constitution suggest elected authority will be heavily circumscribed, previous efforts to tamp down the influence of Thaksin and his proxies having failed. 

Backgrounder: Main Findings of Senate Torture Report

Factbox: U.S. Senate panel’s findings on CIA torture

Reuters,  December 9, 2014

The CIA’s interrogation of al Qaeda terrorism suspects in secret prisons was more brutal than policymakers were told and in some cases amounted to torture that failed to generate effective intelligence, a U.S. Senate panel said in a report Tuesday.

The following are some of the main findings:

* The use of “enhanced interrogation” was ineffective and never produced intelligence that helped to foil an imminent threat. The CIA’s 20 most frequently cited examples of successes are wrong in many details and information gained played little or no role in the counter terrorism success. In fact, prisoners regularly lied and provided false information that deceived the CIA.

* The CIA was far more brutal than policymakers were told. The first CIA detainee, Abu Zubaydah, and many others were subjected to coercive interrogation in near non-stop fashion for days or weeks at a time. Zubaydah’s interrogation was allowed to take precedence over his medical care, resulting in the infection and deterioration of a bullet wound he sustained on capture. At one point during waterboarding he became “completely unresponsive with bubbles rising through his open full mouth,” the report said. The waterboarding of Khalid Sheikh Mohammed, the suspected mastermind of the Sept. 11, 2001 attacks, evolved into a “series of near drownings,” it said.

* The CIA inaccurately described the conditions under which some prisoners were held, denying they resembled those at Abu Ghraib prison in Iraq. In fact, detainees at one location were kept in complete darkness and constantly shackled in isolated cells with loud noise or music and only a bucket for human waste. Lack of heat at one facility likely contributed to the death of a detainee. Some prisoners were walked around naked with their hands shackled above their heads, while others sometimes were hooded while naked and dragged down corridors while being slapped and punched. Prisoners later exhibited psychological problems, including hallucinations, paranoia and attempts at self-injury.

* The CIA provided inaccurate information about the program and its effectiveness to policymakers, including the White House, Congress and the Justice Department. After being briefed, several lawmakers objected. Senator John McCain, who was tortured as a Vietnam war prisoner, told the CIA he believed waterboarding and sleep deprivation were torture. Other senators also objected in writing. But the CIA, while seeking to use the techniques against prisoners, told the Justice Department no senators had objected.

A Calibrated Response To ISIL

December 05, 2014

The ISIL-induced crisis in the Middle East is a major one with regional implications. With several years of dynamic change in the region, and the failure to create a stable Iraq during the period after the overthrow of Saddam Hussein, ISIL has functioned like a match thrown into a gas can. What should we do?

We tried occupation and unification via support of an Iraqi Army controlled by Baghdad. That did not work, but what are realistic alternatives which can be pursued with realistic means and are appropriate to the evolving situation?

This is about ends and means; it is not about replaying the past decade. There is little doubt that a transitional opportunity was missed by the Obama Administration, but with a new Republican Congress we clearly do not need to hear simply that Obama was wrong or that he had no choice and that we need to repeat the past decade.

We need Congress to consider realistic policy options and to debate those options in an open manner to gain the trust of the American public, which has every right not to be handed an ultimatum from the Administration or be simply dictated to by events.

Let us start with the simple proposition: Iraq 2014 is not Iraq 2003. In an earlier article on Breaking Defense, we argued that the President can build on two important realities providing him opportunities in Iraq. First, Iraq in 2014 is not the Iraq of 2003. Not the least of the differences is the embrace of allies in the effort. Second, secular forces in Iraq are fighting for their very lives, one which provides the force on the ground and which can anchor sanity in the region, namely the Kurds. Even more significantly, the first trend intersects with the second.

But Iraq 2014 is not Iraq 2003 in another key dimension: directly dealing with the failure of the Baghdad government to govern Iraq instead of using its assets to try to dominate Iraq in the interests of the Shia. This means that the Iraq Army, a central focus of attention for the US Army in stability operations and nation building, is an inherently flawed instrument of power.

An alternative path needs to be highlighted and supported. The US and its allies can commit to the territorial integrity of Iraq but also to one which is federal in character, rather than one dominated by a Shia Baghdad. In the current environment, there are three key players, each of whom is playing a key role and which can anchor a federal Iraq.

The Kurds are clearly focused on fighting and protecting their region and can be counted open to play a key role in any future Iraq federation. The US and its allies have clearly seen the value of working with the Kurds, and training and operating from Kurdish territory. But there is a limit to what the Kurds will do with regard to the integrity of Iraq.

Dutch Intelligence Chief Admits That Jihadism Is Once Again Sweeping Europe Thanks to ISIS

Washington Institute for Near East Policy

December 4, 2014

On December 4, Rob Bertholee, the director-general of the Dutch General Intelligence and Security Service (AIVD), addressed a Policy Forum at The Washington Institute to discuss the “sudden and explosive renewal” of jihadism in the Netherlands. The following is a rapporteur’s summary of his remarks.

Since the early 2000s, the AIVD has been studying the many forms of jihad in the Netherlands, and in particular violent jihadism. At the beginning of the twenty-first century, Dutch homegrown jihadism was quiet. Small, isolated networks entertained thoughts of jihadism in theory, but in practice their aspirations amounted to little. The role of security services was relatively simple: find the would-be militant and talk him out of it, a method that often worked.

The situation changed completely at the beginning of 2013. Within a few months, hundreds of jihadists left for Syria. The wave surprised everyone. Present estimates put potential Dutch participants in the Syrian conflict at a few hundred, with several thousand more sympathizers. Of the participants, nineteen have been killed — three in suicide attacks — and thirty have returned. Interestingly, a rising number of women and girls, even as young as thirteen, wish to travel to Syria.

At first glance, the Syrian war may seem to have triggered this wave. The country is easy to reach, and the conflict is ideologically attractive for potential jihadists. But Syria is only part of the story. The AIVD has identified four other key developments in play.

First, this sudden explosion took place behind the scenes. The jihadist movement learned from its previous mistakes, becoming more professional in its operations and avoiding unwanted attention. Travelers have learned to lie, telling security services that they’re going to a wedding, or to see their nephew, and the government does not have the legal instruments to stop them. Additionally, online and social media networks help facilitate activities like travel or how to make explosives.

Second, Dutch jihadists have learned from their counterparts in Britain and Belgium. They are expressing their opinions in new, provocative yet legal ways. Freedom of speech gives jihadists great leeway, and they are smart enough to avoid potentially criminal rhetoric.


December 8, 2014 

It has been reported that President Obama is revisiting his policy toward Syria. Perhaps he is now pausing to assess, before incautiously and unadvisedly wading into a conflict with no clear or imaginable resolution. But before he leads America into the next season of a regional conflict he wants a better plan, and he has turned to his national security advisors to provide him with one.

Thus far, the results have not inspired much confidence. As reported by CNN and according to senior officials, the President’s national security team’s meetings were “driven to a large degree [to determine] how our Syria strategy fits into our ISIS strategy.” One senior official was quoted: “The President has asked us to look again at how this fits together. The long-running Syria problem is now compounded by the reality that to genuinely defeat ISIL, we need not only a defeat in Iraq but a defeat in Syria.” The quote conveys the misguided nature of the entire exercise. Now that terrorist organizations have declared allegiance to ISIL in Sinai, Libyaand Pakistan, will we now need to formulate a plan to “genuinely defeat” the group’s ideological adherents in these places as well?

It is clear that the President’s national security team is going about this backwards, trying to twist and contort tactical responses into a “strategy” that fits the ever-changing conditions on the ground in this fraught region. Before the President can ask for a strategy, he needs to articulate a realistic objective. What does he want to achieve? Simply put, what does victory look like? The first step in building a coherent strategy is determining a strategic objective. That may sound simple or rhetorical but it is neither. Here are two examples of strategic objectives the President can use:

Strategic Objective #1: Stabilize Iraq.

Strategic Objective #2: Destroy ISIL.

These two objectives are not the same thing. They should not be conflated, as they call for different methods and strategies that may dovetail and resemble each other in certain respects, but bear very different long-range outcomes. In September, the President named thelatter one as his goal. As part of this strategic re-assessment, the President should pivot to the former. This is true for several reasons but chiefly because a secure and stable Iraq is a strategic necessity for the United States and the region, and far eclipses the destruction of ISIL, an organization whose existence is symptomatic and not the cause of Iraq’s ills. The second and only slightly less important reason is the following: Iraq can be stabilized without destroying ISIL. That’s good news. It will be expensive, it will take time, and at this point, success is far from certain. But the stabilization of Iraq is a location to which we can draw a map. It is critical that this be America’s objective in engaging ISIL, because the bad news is we can’t destroy it.

ISIS Has a Message. Do We?


You can’t say ‘just say no’ to the so-called caliphate if you want to win back its converts and ward off new ones.

ISTANBUL, Turkey—Denouncing murder and enslavement should be an easy task, but for Western governments determined to counter the narrative of the militants of the self-styled Islamic State, it is proving much trickier than they thought. Efforts mounted so far don’t seem to be stemming the flow of foreign recruits eager to join the caliphate of Abu Bakr al-Baghdadi—nor have they done much to deny jihadis online opportunities to groom followers and market their ideology. 

When foreign ministers from nearly 60 countries met in Brussels last week for the first get-together of the U.S.-led coalition against the Islamic State group, widely known as ISIS or ISIL, they identified countering toxic jihad ideology and restricting the flow of foreign fighters as objectives just as important to the defeat of the Islamic militants as overwhelming them on the battlefields in Syria and Iraq. 

But while U.S. Secretary of State John Kerry argued at a news conference that, militarily, the coalition is making progress, maintaining that two months of airstrikes had damaged the capabilities of ISIS, making it much harder for the militants to operate, he cited no progress in the information war and offered no new ideas about how to counter militants adept at spreading their message using Western-based social-media sites such as Twitter or Facebook. 

Indeed, ISIS recently added SoundCloud to its arsenal. So now the jihadis are using what’s widely known as the “Audio YouTube” to upload streaming content to a service that boasts 175 million listeners a month. 

Worries about the effectiveness of ISIS propaganda luring fighters from abroad—more than 15,000 foreign fighters are estimated to have been recruited, at least 3,000 of them Westerners—are driving Western concern. But counterterrorism analysts and experts in de-radicalization say governments are relying too heavily on censorship. This not only runs into problems with civil libertarians, it’s just not very effective against jihadis who view their laptops as weapons and their cause as holy. 

De-radicalization experts argue there is much more that Western governments could do in counteracting the appeal of jihadi propaganda by being more creative and challenging ideas head-on. In a recent report, the Quilliam think tank faulted Western authorities who seem to believe “their case is so obvious it does not need to be made.” 

Welcome to the age of the Shiite

Since at least 1980, the Sunnis of Lebanon, Syria, Iraq and Iran have been brutally suppressed

Ramzi hails from a family of notable Iraqi Sunnis. At the University of Baghdad, he played the guitar and met my Shiite cousin. They both graduated from the School of Engineering with honors, tied the knot, and raised two children. During the Saddam years, when thugs ruled, Ramzi served in the military draft and kept a low profile.

With the outbreak of the civil war in 2007 and the rise in violence, Ramzi moved his family out of Iraq. In exile, he overstretched his resources and had to dip into his emergency reserves by selling part of the vast real estate that his ancestors had owned for centuries.

Iraq’s Shiite militias, however, had other ideas. They occupied his property and made it impossible for him to sell. They called Ramzi a Baathist and an Islamist terrorist, and used this pretext to justify their theft. A refined Sunni who disdains the uncultured Baathists and the wacko Islamists, Ramzi was now lumped in with both. The percentage of Sunnis in Baghdad has dropped from 25% in 2004 to 12% today. Trends suggest further Sunni erosion.

Welcome to the Age of the Shiite. If you are a Sunni who lives in the land that stretches between the Lebanese coast and the Iranian-Afghan border, you are doomed. If you are a secular Sunni, you must be a Baathist and you deserve the same punishment as Nazi war criminals. If you are a Sunni who sympathizes with Islamist parties, you must either be with the Muslim Brotherhood or Al-Qaeda and its offshoots, all of which are terrorist. If you are a Sunni who has spent any time in the Gulf, you must be a Wahhabi with unacceptably austere views on religion.

Since at least 1980, the Sunnis of Lebanon, Syria, Iraq and Iran – in their various political incarnations – have been brutally suppressed.

French Satellite Company Stops Deal to Build Spy Satellites for Russian Military

Bill Gertz
December 9, 2014

French Company Suspends Sale of Spy Satellites to Russian Military

A French satellite company has suspended a deal with Moscow to build spy satellites for the Russian military amid U.S. concerns the satellites will contain U.S.-origin technology and violate sanctions and U.S. export controls.

The plan by Thales Alenia Space to sell the reconnaissance satellites would undermine newly imposed U.S. sanctions on Moscow for its annexation of Ukraine’s Crimea earlier this year, according to U.S. officials.

U.S. intelligence agencies recently expressed concerns in internal reports that two Thales satellites being built for the Russian military were expected to contain U.S.-origin space technology.

Thales, also a major contractor for the Pentagon for high-technology goods, was implicated in the illicit transfer to China of U.S.-origin space technology several years ago, specifically radiation-hardened components, and other dual-use, military-civilian space technology.

The Pentagon currently has seven contracts with Thales Alenia Space, and Congress has considered blocking the company from all Pentagon contracts if the company’s spy satellite deal with Russia is completed.

Asked about the company’s plans for the Russian reconnaissance satellites and whether they would contain U.S.-origin technology, a Thales Alenia Space spokeswoman did not answer directly.

“Thales Alenia Space is not and will not develop any military business with Russia without complying with all U.S., French and other national technology transfer and export control regulations as applicable, including the ITAR-controlled regime under the State Department jurisdiction,” said Sandrine Bielecki, a Thales spokeswoman.

“As a consequence, Thales Alenia Space has stopped all discussions for new military projects and has suspended the execution of ongoing observation military contracts with Russia,” she added.

Russia currently is engaged in a large-scale military buildup inside eastern Ukraine and along Russia’s border with eastern Ukraine. The build up is part of Moscow’s war of nerves against Ukraine that has turned hot at least once in the past four months.