Secret Wars. One Hundred Years of British Intelligence Inside MI5 and MI6
100 years of a spy-empire
SOURCE : CANADA FREE PRESS
David M. Dastych
By David M. Dastych Friday, March 20, 2009
When Sir Winston Churchill resigned from the office of the Prime Minister of Great Britain, in 1955, he was quoted as saying “I will not preside over the dismembering” of what was previously The British Empire. But as the Empire shrank quickly to the size of the United Kingdom, the “Spy-Empire” of MI5 and Mi6, founded in 1909, never receded but expanded world-wide and turned high-tech.
On the eve of its 100th Anniversary, one of the best and most popular British writers, specializing in intelligence, pays a tribute to many generations of British spies and their spy-masters, who have influenced the history of Great Britain and of the world.
His book,“Secret Wars. One Hundred Years of British Intelligence Inside MI5 and MI6” (St.Martin’s Press, March 2009), is a fascinating read for everybody, and for intelligence operatives and young secret service recruits, in particular it should be a must. This book is not a history text or a mere chronicle of events, and it’s not a panegyric either. “The great advantage of being a writer” – Graham Greene once said – “is that you can spy on people. You’re there, listening to every word, but part of you is observing. Everything is useful to a writer, you see – every scrap, even the longest and most boring of luncheon parties.” For a greater part of his 75-year-long life, Gordon Thomas was doing just that: meeting spies and spy-masters, not only British but also American, Israeli, Russian, Chinese, Polish, German and many others and listening to their insider’s stories. The best and undisputable value of his book is the author’s encounters with real flesh and blood intelligence people, including some of them that turned the tide of history.
The research for this book took the author almost 50 years, since the Suez Crisis in 1956, which he had witnessed as a foreign correspondent based in Egypt. From his contacts there he learned about President Naser’s plan to nationalize the Canal and he warned the Foreign Office about that – only to be told that if he missed the truth he better forget about his journalist career. He was right. But it was the British Government to fail in their insane plans to assassinate Naser (described in the book) and then to abort a British-French-Israeli invasion of Egypt, secretly conceived not to inform the Americans. Later on Gordon Thomas covered many other events, which had been planned, provoked or carried out with the participation of secret intelligence services. He was introduced to the world of spying by his late father-in-law and life-time friend, a former British covert agent, Joachim Kraner, to whom he later paid a tribute in his writings.
“Secret Wars” is a story of the British Intelligence over the span of a hundred years, since 1909, when MI5 and MI6 (code-names for the military counter-intelligence and intelligence) were founded to prevent an expected German attack on Great Britain. The over-400 page book is not a systematic, chronologically arranged tale. Each of its 20 chapters is a purposeful mixture of past and present events, sometimes with projections into future. For a reader, this book is a fascinating, perfectly composed thriller, which The New York Times described as “Literally impossible to put down.”
Mark Twain was quoted as saying: “Get your facts first, then you can distort them as you please.” He had writing fiction on his mind but his words could just as well be attributed to the distortion of intelligence by politicians. James Angleton, a famous CIA spy-master and spy-catcher, whom Gordon Thomas had interviewed, summarized this unhealthy relationship between intelligence and politics by these words, quoted in the book: “Secrecy from public scrutiny leads to often uncheckable and different accounts of the same events, which are often contradictory and distorted.” Thomas’ book gives innumerable examples of such misuse of the honest fact-finding by intelligence services, of which a recent one could be a “sexed-up” report about alleged Saddam’s WMDs (weapons of mass destruction) that Prime Minister Blair and President Bush used to justify the 2003 invasion of Iraq.
The Great Game often recalled in “Secret Wars” as the never-ending deception war waged by national intelligence agencies was played over the last hundred years by MI5 and MI6 continues. “The color of truth is gray” (Andre Gide), because truth is evasive and often hidden from the public by purposeful cover-up. Generations of British spies, as well as their controllers and masters, contributed to the security of their country, at times preventing national disasters and saving many thousand of lives during wars. But the British (and also American) intelligence services have been, for decades, deeply penetrated and harmed by Soviet “moles,” recruited at the best universities, such as Cambridge and Oxford. Gordon Thomas writes about treason within the British services and about a complete failure of the counter-intelligence to detect it. The cases of Kim Philby (a high-ranking British counter-intelligence officer and a long-time Soviet spy) and of nuclear scientists, Klaus Fuchs, Alan Nunn May and Bruno Pontecorvo, who passed top atomic weapons secrets of the West to the Soviets, are perhaps the most significant. The author describes these treason cases with passion and talent and warns that “splendid isolation” of some British heads of The Services and their failure to put together and check simple facts, led to a disaster inside MI5 and MI6 and to a long-term lack of confidence between the British and American intelligence.
As the motivation of the Communist spies inside MI5 and MI6 was mainly ideological, the CIA and FBI suffered even bigger losses due to simple “commercial” motivations of their own traitors, like Ames and Hansen. Greed for money was their only reason to betray the services and the country. Aldrich “Rick” Ames destroyed the American spy network in the Soviet Union in the 1980s and caused the deaths of many Russian CIA agents for a reward of some $ 2.7 million from the KGB. Caught, he admitted with sarcastic grin that “The human spy, in terms of the American espionage effort, had never been terribly pertinent.”
Yet the British SIS (MI6) could also score big success with their top spy in the Soviet Russia, Oleg Gordievski, who’s brave exfiltration from USSR by a diplomatic car to Finland in 1985 had proven the efficiency of the British intelligence. A former MI6 covert agent, Richard Tomlinson, told the author, referring to SIS chief Collin McColl who worked in Russia and Poland: “Being in SovBlock meant you lived on the tightrope every moment of every day. Someone who could do that had to be very special.”
With the collapse of the Soviet Block in the early 1990s, the very nature of the Great Game has changed. The exceptionally high value of Gordon Thomas’ book is his factual description and professional assessment of the substantial changes in the intelligence community, caused by new political and military situation of the world at large.
The times of the absolute domination of the two super-powers, the United States and the Soviet Union, have passed forever. For some years, in the 1990s, the U.S. leadership naively believed America could become the only world’s super-power to dictate its policy and to promote the democratic values of the West to the rest of the globe. But soon new threats appeared and the United States (and also Britain as their main ally) realized that the world was too complicated to rule and that the peaceful victory in the Cold War was but a temporary success.
“Secret Wars” is a perfect book to prove that. Once again, Gordon Thomas demonstrated his unique talent in grasping of new trends in the Great Game and in the intelligence community. For no one knows how long a time, the world will be a very dangerous place, with many global and regional centers of power, and with growing problems. Terrorism, which was seen by MI5 and MI6 as mainly a local (IRA) problem or as an offspring of the Communist diversion, had developed into a global monster (al-Qaeda) and its main ideological motivation had become radical Islam, or Islamism.
The negligence of this phenomenon by American and British intelligence agencies led to their ineptitude to prevent 9/11 in America in 2001, and the London bombings of 2005. In spite of many efforts to disrupt al-Qaeda, to defeat the Taliban in Afghanistan and Pakistan, to capture or kill Osama bin Laden, the Islamist radical network is still developing and posing a deadly threat to the West and to Asia and Africa. Two extremely dangerous developments added to the threat of international terrorism: bio-terrorism and nuclear-terrorism. Both have been described in “Secret Wars” with utmost accuracy and a powerful vision. The arsenals of bio-weapons, deadly viruses and bacteria, originally developed in the Soviet Union and also in the West, penetrated to rogue countries, from where they might be distributed to non-state terrorist organizations. On the other hand, nuclear materials and even weapons could be bought up on black markets by envoys of al-Qaeda to be used against the “Infidels” and were also offered by a Pakistani Dr. A.Q.Khan “commercial” network. Dr. Khan described himself as “world’s nuclear bomb peacemaker.” Nuclear scare embraced America and Britain following the 9/11 terrorist attacks on U.S. soil (2001) and the suicide bombings in London (2005). The author pays much attention to these tragic events and to the inability of the powerful secret services to predict and prevent them.
“There’s a new world out there. Adjust or die,” Gordon Thomas quotes former chief of the CIA, Bob Gates. But fortunately for the Western intelligence, people from the “other side” decide to “walk-in” and offer their help. One of these people was (the late) Vladimir Pasechnik from Russia, who contacted the British service to report about his KGB enterprise Biopreparat developing mass-killing toxins, viruses and bacteria. Asked why he did that, he replied: “I want the West to know. There must be a way to stop this madness.” Dr. David Kelly (also late by now), a top British microbiology and bio-weapons expert, told the author after his interrogation of Pasechnik: “The really terrifying thing was that I knew Vladimir was telling the truth.”
Thomas dedicated more than one chapter of his book to the tragic plight of Dr. Kelly, whose more than 30 trips to Iraq in search of bio-weapons ended by a conclusion that there weren’t any. In spite of that, a “sexed-up” intelligence report to the British PM had been used as an excuse for the 2003 invasion of Iraq. In the same year, Dr. Kelly, disgraced and left alone by MI6 and MI5, died, or rather was murdered in strange circumstances. Before his death, a number of bacteriologists from several countries, including Britain, Russia and the U.S.A., were killed by unknown perpetrators, allegedly for refusing to share their knowledge with North Korean, Iranian and probably Chinese intelligence.
New threats and at the same challenges to the intelligence services of Britain and the West, described in detail by Gordon Thomas in “Secret Wars”, could be summed up as: international terrorism, rogue regimes (North Korea, Iran in particular) and a technological diversion, including professional cyber-attacks, led and developed by some states (Russia and China) and even by members of the Western alliance (Israel). It started in early 1980s with the theft of a powerful tracking software system, PROMIS, invented by a former NSA expert William L. Hamilton and produced by his small Washington D.C.-based company Inslaw Inc. Of PROMIS a former Mossad operative, Ari Ben Menashe, quoted by the author, said: “PROMIS changed the thinking of the entire intelligence world.” And Charles Foster Bass added: “Like any good spy novel, the Cox Report alleges that Chinese spies penetrated four U.S. weapons research labs and stole important information on seven nuclear warhead designs.” Only an American citizen and Israel’s spy, Jonathan Pollard (still in American top security prison) could do more. Pollard transmitted over 360 cubic feet of U.S. secret documents to Tel Aviv and some were also sold to Russia. A former CIA chief, the late William Casey complained about that to the author: “It was a double blow. It had cost us every worthwhile secret we had. And it had been stolen by a country supposed to be our ally.”
But God perhaps rewarded the West and MI6 with a voluntary service of a high-ranking Iranian intelligence general, Ali Reza Asgari from VEVAK, code-named “Falcon”, who informed the British intelligence about the nuclear program of Iran and was successfully exfiltrated via Turkey and Bulgaria to the U.K. His motivations were personal and perhaps also monetary, but his services were of top importance to the West.
The spying Great Game goes on undisturbed by moments of failure and agony. The British services, closely cooperating with the American ones, own a big share of the most sophisticated spying technology, including satellite surveillance systems, ECHELON eavesdropping network and the fastest computers in the world. A former CIA chief, William Colby, quoted by the author on the NSA computers, said: “makes lightening look slow. One time there was a program that could translate seven languages at five hundred words per minute. Next time I checked, a month later, it had doubled its capacity and halved its translation time.” The various spying technologies like ELINT, SIGINT, IMINT and missile trajectory tracking systems are well described in the book. But all these marvelous inventions are still short of tracking Osama bin Laden in the mountains of Pakistan or Afghanistan and to follow, like PROMIS, the passage of money to terrorists by an ancient Muslim “hawala” human contact network, based on full confidence of the sender, the receiver and the “hawaladar”, the money handler.
As Mark Twain once remarked, “It is wiser to find out than to suppose.” This phrase might be the best description of what the intelligence services always did and do. Their mission is to discover and transmit secret information to help the governments in their decision making. Michael Smith, a defense analyst, quoted by Gordon Thomas in his Personal Notes closing the book, had captured the inner sense of proper spying: “Intelligence will need to be untainted and unlike the notorious (sexed-up) dossier on Iraq, both genuine and accurate.”
“For decades to come the spy world will continue to be the collective couch where the subconscious of each nation is confessed” (John LeCarre).
Gordon Thomas is well placed on this “couch” to observe what the services do and how Britain and the world benefit or lose from their work. The Great Game will never end and “Secret Wars” is a great book to read and learn of the 100 years of MI5 and MI6 and much more.
David Dastych is a former Polish intelligence operative, who served in the 1960s-1980s and was a double agent for the CIA from 1973 until his arrest in 1987 by then-communist Poland on charges of espionage. Dastych was released from prison in 1990 after the fall of communism and in the years since has voluntarily helped Western intelligence services with tracking the nuclear proliferation black market in Eastern Europe and the Middle East. After a serious injury in 1994 confined him to a wheelchair, Dastych began a second career as an investigative journalist covering terrorism, intelligence and organized crime.
David Dastych is a former Polish intelligence operative, who served in the 1960s-1980s and was a double agent for the CIA from 1973 until his arrest in 1987 by then-communist Poland on charges of espionage. Dastych was released from prison in 1990 after the fall of communism and in the years since has voluntarily helped Western intelligence services with tracking the nuclear proliferation black market in Eastern Europe and the Middle East. After a serious injury in 1994 confined him to a wheelchair, Dastych began a second career as an
investigative journalist covering terrorism, intelligence and organized crime. David can be reached at: davids@aster.pl
March 21, 2009
Bushehr N. Plant to Go Online by Yearend
Iran: Bushehr N. Plant to Go Online by Yearend
TEHRAN (FNA)- Iranian Energy Minister Parviz Fattah said Iran would "finish and operate" its first nuclear power plant in the southern port city of Bushehr by the end of this year.
"Iran will finish and operate the Bushehr nuclear plant by the end of this year," Fattah said at the World Water Forum in Istanbul on Friday.
Fattah said the Bushehr nuclear plant will begin producing at about half capacity (500 megawatts) by late August.
He said it should reach its full 1,000-megawatt capacity by the end of March, 2010.
Iran's Deputy Foreign Minister Hossein Sheikhol-Eslam also said early this month that Bushehr would be fully operational in September.
Asked if US President Barack Obama's overture to Tehran would affect the Iranian nuclear program, Fattah said, "Iran has chosen a direction for achieving peaceful nuclear energy. We have mainly reached this aim."
"Exactly 20 days from now we will have another celebration for celebrating the achievements we have gained for peaceful nuclear energy. You will hear about the news," he said, speaking through an interpreter at a press conference
TEHRAN (FNA)- Iranian Energy Minister Parviz Fattah said Iran would "finish and operate" its first nuclear power plant in the southern port city of Bushehr by the end of this year.
"Iran will finish and operate the Bushehr nuclear plant by the end of this year," Fattah said at the World Water Forum in Istanbul on Friday.
Fattah said the Bushehr nuclear plant will begin producing at about half capacity (500 megawatts) by late August.
He said it should reach its full 1,000-megawatt capacity by the end of March, 2010.
Iran's Deputy Foreign Minister Hossein Sheikhol-Eslam also said early this month that Bushehr would be fully operational in September.
Asked if US President Barack Obama's overture to Tehran would affect the Iranian nuclear program, Fattah said, "Iran has chosen a direction for achieving peaceful nuclear energy. We have mainly reached this aim."
"Exactly 20 days from now we will have another celebration for celebrating the achievements we have gained for peaceful nuclear energy. You will hear about the news," he said, speaking through an interpreter at a press conference
France expands NATO westward
22:51 | 18/ 03/ 2009
MOSCOW. (RIA Novosti political commentator Andrei Fedyashin) - France's National Assembly rejected a vote of no confidence against the government, a motion that was proposed by Prime Minister Francois Fillon.
Now, Paris has officially returned to NATO's integrated military command after more than 40 years of absence. This NATO's westward expansion was largely a formality. In real life, Paris has long taken part in all of NATO's main operations and has been fourth in its contribution to NATO's foreign military operations in Afghanistan, Kosovo, and Iraq in the last ten years.
Nicolas Sarkozy spoke more than once about the need to return to NATO's central post because it is not befitting for the EU's main member not to take part in decision-making in a bloc that unites the majority of European countries.
Needless to say, France is not returning to the NATO of Charles de Gaulle times. By withdrawing from NATO's military command, the general protested not against NATO per se, but against U.S. domination in it. He did not like Washington at all. Now, after George W. Bush's departure, in conditions of global turmoil, America's loss of prestige and the EU's general irritation, NATO will not be quite the same. European politicians have long been talking about the need for fundamental structural reforms in NATO, and reduction of its bloated and ossified bureaucracy.
The French left-wing forces often blame Sarkozy for his excessive fondness of America, although up to this day this love has only been expressed in his short vacations in America. It is not likely to reveal itself within NATO. On the contrary, Paris is returning to NATO with the full resolve to change the organization from within.
Debates in the National Assembly made it clear that France's presence in NATO will not be easy and smooth. During the debates, French Defense Minister Herve Morin said that it is impossible to decide on the NATO entry of Georgia and Ukraine without consultations with Russia. He said that France believes that NATO should focus on its main task of ensuring collective security rather than turning itself into a global bloc.
There is one more fact showing that the United States is dramatically changing its attitude towards NATO's expansion. By coincidence, on the day of the debates in France, U.S. President Barack Obama received a report by the bipartisan commission of experts on U.S. policy toward Russia headed by former Senator and presidential nominee Gary Hart (Dem.) and former Senator Chuck Hagel (Rep.). In the report, they urge the West to find alternative ways of cooperating with Georgia and Ukraine other than NATO's membership. They emphasize that these countries are not ready to enter NATO, and that the United States, in terms of its national security interests, does not require their membership in the bloc.
The opinions expressed in this article are the author's and do not necessarily represent those of RIA Novosti.
MOSCOW. (RIA Novosti political commentator Andrei Fedyashin) - France's National Assembly rejected a vote of no confidence against the government, a motion that was proposed by Prime Minister Francois Fillon.
Now, Paris has officially returned to NATO's integrated military command after more than 40 years of absence. This NATO's westward expansion was largely a formality. In real life, Paris has long taken part in all of NATO's main operations and has been fourth in its contribution to NATO's foreign military operations in Afghanistan, Kosovo, and Iraq in the last ten years.
Nicolas Sarkozy spoke more than once about the need to return to NATO's central post because it is not befitting for the EU's main member not to take part in decision-making in a bloc that unites the majority of European countries.
Needless to say, France is not returning to the NATO of Charles de Gaulle times. By withdrawing from NATO's military command, the general protested not against NATO per se, but against U.S. domination in it. He did not like Washington at all. Now, after George W. Bush's departure, in conditions of global turmoil, America's loss of prestige and the EU's general irritation, NATO will not be quite the same. European politicians have long been talking about the need for fundamental structural reforms in NATO, and reduction of its bloated and ossified bureaucracy.
The French left-wing forces often blame Sarkozy for his excessive fondness of America, although up to this day this love has only been expressed in his short vacations in America. It is not likely to reveal itself within NATO. On the contrary, Paris is returning to NATO with the full resolve to change the organization from within.
Debates in the National Assembly made it clear that France's presence in NATO will not be easy and smooth. During the debates, French Defense Minister Herve Morin said that it is impossible to decide on the NATO entry of Georgia and Ukraine without consultations with Russia. He said that France believes that NATO should focus on its main task of ensuring collective security rather than turning itself into a global bloc.
There is one more fact showing that the United States is dramatically changing its attitude towards NATO's expansion. By coincidence, on the day of the debates in France, U.S. President Barack Obama received a report by the bipartisan commission of experts on U.S. policy toward Russia headed by former Senator and presidential nominee Gary Hart (Dem.) and former Senator Chuck Hagel (Rep.). In the report, they urge the West to find alternative ways of cooperating with Georgia and Ukraine other than NATO's membership. They emphasize that these countries are not ready to enter NATO, and that the United States, in terms of its national security interests, does not require their membership in the bloc.
The opinions expressed in this article are the author's and do not necessarily represent those of RIA Novosti.
Three forces that will transform management
Source: http://whatmatters.mckinseydigital.com/organization/three-forces-that-will-transform-management
WHAT MATTER :
McKinsey
By Gary Hamel
26 February 2009
The technology of management—the tools and techniques we use to mobilize human effort—is likely to change dramatically over the next few years. Modern management was invented a century ago to solve one overriding problem: how to organize work at scale with ever-increasing productivity. This problem is still important, but organizations now confront a new set of challenges, which cannot be solved with Industrial Age management practices and structures.
Today, the overriding problem for every organization is how to change, deeply and continually, and at an accelerating pace. We live in a world where change is “shaken, not stirred.” Yet in most organizations, practices and structures reflexively favor the status quo over change and renewal. We see entire industries—for example, pharmaceuticals, music, advertising, and publishing—where the incumbents are struggling to invent their way out of slowly dying business models.
The barriers that once protected large companies from the winds of creative destruction are crumbling. The result: hypercompetition and relentless pressure on margins. In this environment, the returns on “incrementalism” are going down while the premium on innovation is rapidly increasing. In most organizations, innovation is still mostly an afterthought. It’s a project, an initiative, or a function, but it’s not an activity that involves everyone, every day.
The need to adapt and innovate will require organizations to better use their human capital. For organizations to succeed in today’s “creative economy,” they need employees who bring more than their diligence and expertise to work: employees must also bring their imagination and passion. Again, there’s much work to be done here. Global surveys show that fewer than 20 percent of employees—and in some countries as few as 2 or 3 percent—are highly engaged in their work. Most people are just not emotionally or intellectually committed to what they do on the job. Perhaps companies could afford that when most employees were just expected to follow the rules, but today this lack of engagement is competitively untenable.
Unless organizations in the developed world want to join the race to the bottom, they must find a management model that encourages people to bring the very best of themselves to work everyday. For all these reasons tomorrow’s business leaders must create companies that are more adaptable, innovative, and inspiring than the bureaucratic, top-down organizations that predominate today.
When you look back at the history of management, you find that it was the management pioneers that became the 20th century’s industrial giants: GE brought management discipline to science and helped to create the world’s first R&D labs. P&G developed methods for creating value around brands—assets that didn’t even appear on the balance sheet. In this new century, I’m confident that bold management innovators will be the winners.
In addition, I believe there’s a good chance that the technology of management will change as radically in the next few decades as it did in the early part of the last century. Three things will drive this new management revolution. First, as I described earlier, companies today face a set of new and inescapable challenges that lie outside the performance envelope of management as usual. The second driving force is the Internet, which has spawned a vast array of new tools for managing collaboration. In the past, nothing could be done at scale without a lot of bureaucratic structures. Now thousands of people can collaborate around the world online with little in the way of formal hierarchy or management structures. Suppose, for a moment, that ten years ago someone had surveyed the top 100 executives in each of the Fortune 500 companies—that’s 50,000 business leaders—and asked them if they could imagine a time when a disparate army of volunteers from across the world, with no formal control processes, no budgets, and no real funding, could create one of the most complex of all products: a computer operating system. I doubt that one executive out of a thousand would have said, “Sure, this will happen.” Yet the Linux operating system was developed in precisely this way. So we should be asking ourselves, what are the potential management breakthroughs that we can scarcely imagine?
These new Web-based tools will allow hierarchies to form around natural leaders rather than beneath the individuals who have been given formal, hierarchical appointments. They will democratize the workplace and give everyone the chance to help create strategy and offer advice on critical issues. This won’t happen overnight, but organizations will eventually figure out how to use these new tools, just as those early management pioneers learned how to use the telegraph and then the telephone to better manage large-scale organizations.
The values and attitudes of the Millennials now entering the work force make up the third challenge that will compel organizations to retool their legacy management models. If you spent your adolescence creating, collaborating, and learning on the Web, you’ve developed some sensibilities that will be very hard to change once you enter the work force. One of these is the belief that all ideas should compete on a level playing field. The twentysomethings who take this as a point of faith won’t want to work in organizations where a senior executive’s point of view gets an extra measure of credibility simply because he or she sits higher up in the hierarchy.
This new generation also believes that all information should be accessible. The ethos is to share information freely, not to dole it out on a need-to-know basis, as management often did in the past.
What’s more, this new generation believes that people should be measured on the basis of their contributions, not their credentials. When you post something on YouTube or write a blog, nobody asks, “Did you go to film school?” “Do you have a journalism degree?” People ask, “Was it funny?” “Was it incisive?” So any company that hopes to hire the best and the brightest will have to confront the need to dramatically change how they manage and how they organize, because the value system found in most organizations today is antithetical to the value systems that drive collaboration on the Web.
These three factors—inescapable challenges that defy conventional management wisdom, new social technologies that allow human beings to accomplish great things without the weight of bureaucracy, and a new generation of employees who come to work preloaded with antibureaucracy values—are going to force a fundamental rethink of how we lead, manage, and organize. Already you can see harbingers of the revolution to come: if your company isn’t on the reinvention curve, it’s going to be at a serious disadvantage. Just as organizations spent huge amounts of energy over the past decade reinventing their operating models—their logistics, supply chains, and customer support—they must now commit themselves to reengineering their management models.
Historically, the diffusion rate for new management ideas has been pretty slow. The principles of Total Quality Management, for instance, were first applied in a few Japanese companies after World War II, but it wasn’t until the 1980s that they finally went mainstream. I’d like to believe that we can change a bit faster this time. But there will be resistance. Executives have worked hard for the privileges they enjoy in the current system and won’t be eager to abandon them.
The new management pioneers may come from Brazil, China, India, and Mexico—and from other parts of the world where the Western management model is not yet thoroughly entrenched. Young companies are often filled with equally young employees who have little to unlearn. If I had to make a bet, I’d wager that tomorrow’s most progressive management innovators won’t come from the Fortune 500.
WHAT MATTER :
McKinsey
By Gary Hamel
26 February 2009
The technology of management—the tools and techniques we use to mobilize human effort—is likely to change dramatically over the next few years. Modern management was invented a century ago to solve one overriding problem: how to organize work at scale with ever-increasing productivity. This problem is still important, but organizations now confront a new set of challenges, which cannot be solved with Industrial Age management practices and structures.
Today, the overriding problem for every organization is how to change, deeply and continually, and at an accelerating pace. We live in a world where change is “shaken, not stirred.” Yet in most organizations, practices and structures reflexively favor the status quo over change and renewal. We see entire industries—for example, pharmaceuticals, music, advertising, and publishing—where the incumbents are struggling to invent their way out of slowly dying business models.
The barriers that once protected large companies from the winds of creative destruction are crumbling. The result: hypercompetition and relentless pressure on margins. In this environment, the returns on “incrementalism” are going down while the premium on innovation is rapidly increasing. In most organizations, innovation is still mostly an afterthought. It’s a project, an initiative, or a function, but it’s not an activity that involves everyone, every day.
The need to adapt and innovate will require organizations to better use their human capital. For organizations to succeed in today’s “creative economy,” they need employees who bring more than their diligence and expertise to work: employees must also bring their imagination and passion. Again, there’s much work to be done here. Global surveys show that fewer than 20 percent of employees—and in some countries as few as 2 or 3 percent—are highly engaged in their work. Most people are just not emotionally or intellectually committed to what they do on the job. Perhaps companies could afford that when most employees were just expected to follow the rules, but today this lack of engagement is competitively untenable.
Unless organizations in the developed world want to join the race to the bottom, they must find a management model that encourages people to bring the very best of themselves to work everyday. For all these reasons tomorrow’s business leaders must create companies that are more adaptable, innovative, and inspiring than the bureaucratic, top-down organizations that predominate today.
When you look back at the history of management, you find that it was the management pioneers that became the 20th century’s industrial giants: GE brought management discipline to science and helped to create the world’s first R&D labs. P&G developed methods for creating value around brands—assets that didn’t even appear on the balance sheet. In this new century, I’m confident that bold management innovators will be the winners.
In addition, I believe there’s a good chance that the technology of management will change as radically in the next few decades as it did in the early part of the last century. Three things will drive this new management revolution. First, as I described earlier, companies today face a set of new and inescapable challenges that lie outside the performance envelope of management as usual. The second driving force is the Internet, which has spawned a vast array of new tools for managing collaboration. In the past, nothing could be done at scale without a lot of bureaucratic structures. Now thousands of people can collaborate around the world online with little in the way of formal hierarchy or management structures. Suppose, for a moment, that ten years ago someone had surveyed the top 100 executives in each of the Fortune 500 companies—that’s 50,000 business leaders—and asked them if they could imagine a time when a disparate army of volunteers from across the world, with no formal control processes, no budgets, and no real funding, could create one of the most complex of all products: a computer operating system. I doubt that one executive out of a thousand would have said, “Sure, this will happen.” Yet the Linux operating system was developed in precisely this way. So we should be asking ourselves, what are the potential management breakthroughs that we can scarcely imagine?
These new Web-based tools will allow hierarchies to form around natural leaders rather than beneath the individuals who have been given formal, hierarchical appointments. They will democratize the workplace and give everyone the chance to help create strategy and offer advice on critical issues. This won’t happen overnight, but organizations will eventually figure out how to use these new tools, just as those early management pioneers learned how to use the telegraph and then the telephone to better manage large-scale organizations.
The values and attitudes of the Millennials now entering the work force make up the third challenge that will compel organizations to retool their legacy management models. If you spent your adolescence creating, collaborating, and learning on the Web, you’ve developed some sensibilities that will be very hard to change once you enter the work force. One of these is the belief that all ideas should compete on a level playing field. The twentysomethings who take this as a point of faith won’t want to work in organizations where a senior executive’s point of view gets an extra measure of credibility simply because he or she sits higher up in the hierarchy.
This new generation also believes that all information should be accessible. The ethos is to share information freely, not to dole it out on a need-to-know basis, as management often did in the past.
What’s more, this new generation believes that people should be measured on the basis of their contributions, not their credentials. When you post something on YouTube or write a blog, nobody asks, “Did you go to film school?” “Do you have a journalism degree?” People ask, “Was it funny?” “Was it incisive?” So any company that hopes to hire the best and the brightest will have to confront the need to dramatically change how they manage and how they organize, because the value system found in most organizations today is antithetical to the value systems that drive collaboration on the Web.
These three factors—inescapable challenges that defy conventional management wisdom, new social technologies that allow human beings to accomplish great things without the weight of bureaucracy, and a new generation of employees who come to work preloaded with antibureaucracy values—are going to force a fundamental rethink of how we lead, manage, and organize. Already you can see harbingers of the revolution to come: if your company isn’t on the reinvention curve, it’s going to be at a serious disadvantage. Just as organizations spent huge amounts of energy over the past decade reinventing their operating models—their logistics, supply chains, and customer support—they must now commit themselves to reengineering their management models.
Historically, the diffusion rate for new management ideas has been pretty slow. The principles of Total Quality Management, for instance, were first applied in a few Japanese companies after World War II, but it wasn’t until the 1980s that they finally went mainstream. I’d like to believe that we can change a bit faster this time. But there will be resistance. Executives have worked hard for the privileges they enjoy in the current system and won’t be eager to abandon them.
The new management pioneers may come from Brazil, China, India, and Mexico—and from other parts of the world where the Western management model is not yet thoroughly entrenched. Young companies are often filled with equally young employees who have little to unlearn. If I had to make a bet, I’d wager that tomorrow’s most progressive management innovators won’t come from the Fortune 500.
Thinking about Thinking : Global Business by Peter Day BBC
In the latest edition Peter Day talks to Tim Brown of Ideo and Roger Martin, Dean of the Rotman School of Management, University of Toronto on a new role for designers - redesigning what companies do.
Thinking about Thinking
DOWNLOAD PROGRAM
About this programme by Peter Day
For a long time I was frightened of thinking. It was (I assumed) an analytic practice. I had a brain that was wretched at analysis. But quite good at synthesis and association.
Actually, that wasn’t all bad. As you get older (see pic.) analysis tends to lose its vigour; it’s a young persons’ game. But synthesis goes on, and gets better results, perhaps as you get more experience to synthesise as you get older.
I would like to have been taught that a long time ago. But they didn’t seem to teach thinking in those days. However it is now becoming a discipline in its own right, and this week’s programme hears from two people keenly interested in thinking about business.
One of them is the dean of a business school, and that is immediately interesting because I don’t know that business schools have been interested in thinking until rather recently.
Management education gives its expensive students the tools to do the job : analytic techniques, strategic skill sets, case studies about historic problems to be solved afresh, and of course a prodigious network of fellow students who will go out and conquer their own worlds.
Fuzzy
But to all that stuff, Roger Martin is trying to add the art of thinking to the curriculum at the Rotman School of Management at the University of Toronto in Canada.
He calls it Integrative Thinking with a trademark sign attached. Instead of choosing between one or the other opposing solution, Roger Martin urges business leaders to build a superior new model, building on the original proposals but superior to them. It may sound fuzzy the way I tell it, but it’s systematically worked out to take the tension out of the opposing models which is the way conventional thinkers look at the business world.
When he visited the school seven years ago the late Professor Peter Drucker said : ““What the Rotman School is doing may be the most important thing happening in management education today.” And Peter Drucker was the most thoughtful management guru, ever.
Weighty
Another thing they do well at Rotman is produce a thrice a year magazine which tackles real ideas with a verve and style that I have not encountered anywhere else, benefiting from the influence of distinctive Canadian designers.
Roger Martin regards design as a central part of thinking about business..not just as decoration or an add on, but as a way of running business as a whole.
The other interviewee in this programme is the designer Tim Brown, the British born Royal College of Art graduate who is now president and chief executive of the international design group Ideo, based in Palo Alto in Silicon Valley (that place again!).
In a similar way to Roger Martin at Rotman, he is a proponent of the idea that design has a great deal to teach managers. Last year he wrote a striking article about this in the weighty Harvard Business Review called Design Thinking.
Simple
For many years Ideo has gone far deeper into business than merely designing products. A walk round any of the Idea studios is exhilarating.
Ideo’s designers often start a project by creating a pretty detailed profile of the customer who may use the final product : a fully fleshed out biography that will enable them to envision how real people will respond to thing they are creating.
But design thinking goes deeper than that. Tim Brown (and Roger Martin) argue that thinking like designers ought to animate many aspects of management, hitherto obsessed with process and marketing and strategy to the often exclusion of the people who will buy the product or service the company is trying to maker.
If business people listen to them, it might create nothing less than a revolution. Managers love to repeat the mantra “Keep it simple stupid.” But life isn’t simple, and designers may be more aware of that than companies are.
That’s just a thought ... but quite a big one. The kind they really ought to be teaching at business school.
Contributors:
Tim Brown, CEO, Ideo
/
Roger Martin, Dean of the Rotman School of Management, University of Toronto
Thinking about Thinking
DOWNLOAD PROGRAM
About this programme by Peter Day
For a long time I was frightened of thinking. It was (I assumed) an analytic practice. I had a brain that was wretched at analysis. But quite good at synthesis and association.
Actually, that wasn’t all bad. As you get older (see pic.) analysis tends to lose its vigour; it’s a young persons’ game. But synthesis goes on, and gets better results, perhaps as you get more experience to synthesise as you get older.
I would like to have been taught that a long time ago. But they didn’t seem to teach thinking in those days. However it is now becoming a discipline in its own right, and this week’s programme hears from two people keenly interested in thinking about business.
One of them is the dean of a business school, and that is immediately interesting because I don’t know that business schools have been interested in thinking until rather recently.
Management education gives its expensive students the tools to do the job : analytic techniques, strategic skill sets, case studies about historic problems to be solved afresh, and of course a prodigious network of fellow students who will go out and conquer their own worlds.
Fuzzy
But to all that stuff, Roger Martin is trying to add the art of thinking to the curriculum at the Rotman School of Management at the University of Toronto in Canada.
He calls it Integrative Thinking with a trademark sign attached. Instead of choosing between one or the other opposing solution, Roger Martin urges business leaders to build a superior new model, building on the original proposals but superior to them. It may sound fuzzy the way I tell it, but it’s systematically worked out to take the tension out of the opposing models which is the way conventional thinkers look at the business world.
When he visited the school seven years ago the late Professor Peter Drucker said : ““What the Rotman School is doing may be the most important thing happening in management education today.” And Peter Drucker was the most thoughtful management guru, ever.
Weighty
Another thing they do well at Rotman is produce a thrice a year magazine which tackles real ideas with a verve and style that I have not encountered anywhere else, benefiting from the influence of distinctive Canadian designers.
Roger Martin regards design as a central part of thinking about business..not just as decoration or an add on, but as a way of running business as a whole.
The other interviewee in this programme is the designer Tim Brown, the British born Royal College of Art graduate who is now president and chief executive of the international design group Ideo, based in Palo Alto in Silicon Valley (that place again!).
In a similar way to Roger Martin at Rotman, he is a proponent of the idea that design has a great deal to teach managers. Last year he wrote a striking article about this in the weighty Harvard Business Review called Design Thinking.
Simple
For many years Ideo has gone far deeper into business than merely designing products. A walk round any of the Idea studios is exhilarating.
Ideo’s designers often start a project by creating a pretty detailed profile of the customer who may use the final product : a fully fleshed out biography that will enable them to envision how real people will respond to thing they are creating.
But design thinking goes deeper than that. Tim Brown (and Roger Martin) argue that thinking like designers ought to animate many aspects of management, hitherto obsessed with process and marketing and strategy to the often exclusion of the people who will buy the product or service the company is trying to maker.
If business people listen to them, it might create nothing less than a revolution. Managers love to repeat the mantra “Keep it simple stupid.” But life isn’t simple, and designers may be more aware of that than companies are.
That’s just a thought ... but quite a big one. The kind they really ought to be teaching at business school.
Contributors:
Tim Brown, CEO, Ideo
/
Roger Martin, Dean of the Rotman School of Management, University of Toronto
Be happy, don`t worry about a free Balochistan
Khan Jan Baloch
History is made after threats, genocides and the oppressions by State`s various actors on one hand. But on the other hand, she writes her chapters & shapes her profile in accordance with the prevailing socio-economic atmosphere, by her geopolitical situation, pushing the masses to the walls, creating the sense of slavery. The yearnings of the oppressed nations for the emanicipation is formed by the mutual agreements of the nations for their bilateral existance and above of all, the firm determination to throw the yoke of slavery writes excellent events in the books called history.
Balochistan has never accepted the dominance of Pakistan since Marach, 1948 and Afghanistan has never accepted the illegal occupation of Pakhtunkhawa and Balochistan by Pakistan.To maintain the illegal occupation over Balochistan and Pakhtunkhawa, Pakistan has left no stone unturened to destabilize Afghanistan. Millions of human beings have been slaughtered after the killing of Sardar Daud Khan, the first President of Afghanistan, due to the Pakistani ISI inspired military coup. Remember that Sardar Daud Khan was a staunch supporter of Pashtuns & Balochs. He was removed by Panjabis to keep Balochs and Pashtuns in the schakels of slavery. But Panjabis could not and shall never be victorous in Afghanistan to make Afghans their slaves any more. On the contrary, in the foreseeble future, Afghanistan shall be in strong position to deliver the fruits of freedom to his neighbouring brothers - Pashtuns & Balochs. Do weep or laugh loudly, you have to free Balochistan.
To sustain the illegal occupation of Baloch and Pakhtun lands, the Pakistani establishment threatens her neighbours with WMD, installation of Wahabi Talibanisation in Pakistan, promulgation of Sharia Laws, with their "green garden" vision to establish Khilafate Raj in the whole world.
The Pakistani proxy war, either in Afghanistan or in India is a totall failure. Her allies, middle-east countries, Iran, North Korea and China can finance them and provide different weapons but they shall never be able to stop the melting-down of the forced-married State called Pakistan.
In the end, Khane Qalat, Mir Daud Khan - based in London, - shall give permission to NATO/ISAF forces to use Baloch land, coast and air space for the logistic supply to Baloch`s friends in Afghanistan. Do laugh loudly or cry deeply, but you have to free Balochistan because Balochs whole-heartly aspire that Balochistan should get her status before 27th March, 1948. Khane Qalat as the head of the State, assisted by two Baloch Parliaments..The lower house and the upper house. It`s not 1948.
Be happy & laugh loudly for the freedom of Balochistan because it shall bring peace and prosperity not only in South Asia but in the whole world. A student of political science is well aware that Balochistan has been the pivotal political policy of Pakistan. The thirst of adding more land in Pakistan and to exploit or steal the rich mineral resources of Balochistan are the main reasons for many Military Coups, internal unrest and denial of human rights to the citizens of Pakistan for the last 61 years.To keep the golden bird - Balochistan - in the cage, Pakistani ISI has waged several wars during the period of 61 years on different fronts. It`s the same case now, too. Pakistani Military and ISI is spreading her "War of terror" not only against Balochs but also she is very busy on her eastern and western borders, leaving aside their adventures in remote lands, over the seven seas !!! The abundent incomes from the Baloch mineral resources has helped to enlarge the Pakistani Army and covered the costs to build WMD. Baloch mineral wealth has increased the bank balances of the elite class of Pakistan.The common citizens of Pakistan shall never cry for a free Balochistan as they do not benefit from the looting of natural resources of Balochistan. The neighbouring countries shall, surely, rejoice on the freedom of Balochistan because the Pakistani Army shall never be able to carry-out their pocket Jehadi activities abroad.
Pakistan has ploughed and sowed the idea of "depth stratagic policy in both India & Afghanistan." Now she is reaping the same inputs. Pakistani establishment is not impunate to terrorize and kill the citizens of her neighbours. One can predict, that in the foreseeble period, the counter-insurgencey and surgical strikes all over Pakistan may be the "common dadily news" in response to their illegal interference in the affairs of their neighbours.
While, the continued insurgencies shall, undoubtedly, cripple the economy of Pakistan with the result of demoralisaring & decreasing the number of her Armed Forces and various Jehadi Organisations. The self created crisis by ISI in Pakistan, with their motives to pave the way for Talibanisation in Pakistan, shall never be accepted by Balochistan. The civilised world alongwith the United Nations shall come forward to help Balochistan & Pakhtunkhawa, as an ally, to fight against Talibans, fundamental Islamic forces and Chinese menace. The chances for
a secular, a democratic and free Balochistan are
as bright as a light of a day!!! Please be happy and don`t worry, if Balochs get their freedom.
Thanks to the present greedy elite class of Pakistan, the Pakistani common citizen`s economic burden shall be unbearable and Balochistan shall be denied and bluffed to get her rights, as usual. The mutiny of the ethnic groups of Pakistan shall never be finished. Social, secterian and the ISI created crisis shall add the misery to the stabilisation of Pakistan.
Again, The civilised world shall be smart enough by refusing to "dig their own graves." as they shall be enlightened that the aid to Pakistan, money & weapons - finally is destined to Talibans (read: Pakistani trained gorilla soldiers ) who kill NATO soldiers in Afghanistan. They are well aware that Pakistan can`t solve their economic problems, even if they get fifty billion dollars every month. In the long run, the clash between the Pakistani Army and the people of Pakistan shall result into a new geo/socio/economic contract which means, in the case of Balochistan, an Independent State.....be happy don`t worry !!!
Again, not only the neighbours of Pakistan are in trouble but the greedy class and their barbarous, disgraced Army and ISI has made an hell to the citizens of whole Pakistan, including her mainland...Panjab. Why they are experiencing trouble, difficulties, inflation, Military dictator-ships, wars, countless self created crisis by ISI, sectarian crisis, ethnic battles? Is it not the result of
forcebly hold Balochistan in Pakistan? Why a common Pakistani is not welcommed in Western world to seek employment and they are suspected as Talibans/Quides or Qazis? The answer is ....Pakistani Army is attempting, unsuccessfuly, to keep their occupation over Balochistan and they are, like the insae beasts are "fighting the war of terror" against the whole world, specially against Afghanistan and India. Be happy & don`t worry, if Balochistan emerges as a free State.
The beneficial side-effects of the freedom of Balochistanshall be the freedom of the people of Panjab and rest of Pakistan i.e. to take the breath of freedom in democracy, freedom to speech, freedom for movement, economic freedom for an ordinary citizen of Pakistan and freedom to settle in the whole world. They can purchase the mineral resources of Balochistan on very cheap prices and Balochistan shall be their nice, truthworthy and friendly neighbour.
We do firmly beleive that an Independent Balochistan shall feed more Panjabis. A peaceful and free Balochistan shall need more labours, technicians and men of white collor.This gap can be filled-up not only bt Panjabi Balochs but also from central and eastern part of Panjab. On the other hand, the whole world, including India and Afghanistan, shall create golden opportunies to boost the economic opportunities for a peaceful Panjab/Pakistan. This can only happen if you don`t cry but be happy for..... an Independent, sovereign and free Balochistan which - in foreseeble future- shall help Panjab to not become a land-locked country. The chance are crystal clear that the Free Balochistan shall make a Union with Panjab, as we see, nowadays ..... in European Union.
Be happy & don`t worry about the freedom of Balochistan..
( The Global Friends of Balochs )
www.gwank.org
History is made after threats, genocides and the oppressions by State`s various actors on one hand. But on the other hand, she writes her chapters & shapes her profile in accordance with the prevailing socio-economic atmosphere, by her geopolitical situation, pushing the masses to the walls, creating the sense of slavery. The yearnings of the oppressed nations for the emanicipation is formed by the mutual agreements of the nations for their bilateral existance and above of all, the firm determination to throw the yoke of slavery writes excellent events in the books called history.
Balochistan has never accepted the dominance of Pakistan since Marach, 1948 and Afghanistan has never accepted the illegal occupation of Pakhtunkhawa and Balochistan by Pakistan.To maintain the illegal occupation over Balochistan and Pakhtunkhawa, Pakistan has left no stone unturened to destabilize Afghanistan. Millions of human beings have been slaughtered after the killing of Sardar Daud Khan, the first President of Afghanistan, due to the Pakistani ISI inspired military coup. Remember that Sardar Daud Khan was a staunch supporter of Pashtuns & Balochs. He was removed by Panjabis to keep Balochs and Pashtuns in the schakels of slavery. But Panjabis could not and shall never be victorous in Afghanistan to make Afghans their slaves any more. On the contrary, in the foreseeble future, Afghanistan shall be in strong position to deliver the fruits of freedom to his neighbouring brothers - Pashtuns & Balochs. Do weep or laugh loudly, you have to free Balochistan.
To sustain the illegal occupation of Baloch and Pakhtun lands, the Pakistani establishment threatens her neighbours with WMD, installation of Wahabi Talibanisation in Pakistan, promulgation of Sharia Laws, with their "green garden" vision to establish Khilafate Raj in the whole world.
The Pakistani proxy war, either in Afghanistan or in India is a totall failure. Her allies, middle-east countries, Iran, North Korea and China can finance them and provide different weapons but they shall never be able to stop the melting-down of the forced-married State called Pakistan.
In the end, Khane Qalat, Mir Daud Khan - based in London, - shall give permission to NATO/ISAF forces to use Baloch land, coast and air space for the logistic supply to Baloch`s friends in Afghanistan. Do laugh loudly or cry deeply, but you have to free Balochistan because Balochs whole-heartly aspire that Balochistan should get her status before 27th March, 1948. Khane Qalat as the head of the State, assisted by two Baloch Parliaments..The lower house and the upper house. It`s not 1948.
Be happy & laugh loudly for the freedom of Balochistan because it shall bring peace and prosperity not only in South Asia but in the whole world. A student of political science is well aware that Balochistan has been the pivotal political policy of Pakistan. The thirst of adding more land in Pakistan and to exploit or steal the rich mineral resources of Balochistan are the main reasons for many Military Coups, internal unrest and denial of human rights to the citizens of Pakistan for the last 61 years.To keep the golden bird - Balochistan - in the cage, Pakistani ISI has waged several wars during the period of 61 years on different fronts. It`s the same case now, too. Pakistani Military and ISI is spreading her "War of terror" not only against Balochs but also she is very busy on her eastern and western borders, leaving aside their adventures in remote lands, over the seven seas !!! The abundent incomes from the Baloch mineral resources has helped to enlarge the Pakistani Army and covered the costs to build WMD. Baloch mineral wealth has increased the bank balances of the elite class of Pakistan.The common citizens of Pakistan shall never cry for a free Balochistan as they do not benefit from the looting of natural resources of Balochistan. The neighbouring countries shall, surely, rejoice on the freedom of Balochistan because the Pakistani Army shall never be able to carry-out their pocket Jehadi activities abroad.
Pakistan has ploughed and sowed the idea of "depth stratagic policy in both India & Afghanistan." Now she is reaping the same inputs. Pakistani establishment is not impunate to terrorize and kill the citizens of her neighbours. One can predict, that in the foreseeble period, the counter-insurgencey and surgical strikes all over Pakistan may be the "common dadily news" in response to their illegal interference in the affairs of their neighbours.
While, the continued insurgencies shall, undoubtedly, cripple the economy of Pakistan with the result of demoralisaring & decreasing the number of her Armed Forces and various Jehadi Organisations. The self created crisis by ISI in Pakistan, with their motives to pave the way for Talibanisation in Pakistan, shall never be accepted by Balochistan. The civilised world alongwith the United Nations shall come forward to help Balochistan & Pakhtunkhawa, as an ally, to fight against Talibans, fundamental Islamic forces and Chinese menace. The chances for
a secular, a democratic and free Balochistan are
as bright as a light of a day!!! Please be happy and don`t worry, if Balochs get their freedom.
Thanks to the present greedy elite class of Pakistan, the Pakistani common citizen`s economic burden shall be unbearable and Balochistan shall be denied and bluffed to get her rights, as usual. The mutiny of the ethnic groups of Pakistan shall never be finished. Social, secterian and the ISI created crisis shall add the misery to the stabilisation of Pakistan.
Again, The civilised world shall be smart enough by refusing to "dig their own graves." as they shall be enlightened that the aid to Pakistan, money & weapons - finally is destined to Talibans (read: Pakistani trained gorilla soldiers ) who kill NATO soldiers in Afghanistan. They are well aware that Pakistan can`t solve their economic problems, even if they get fifty billion dollars every month. In the long run, the clash between the Pakistani Army and the people of Pakistan shall result into a new geo/socio/economic contract which means, in the case of Balochistan, an Independent State.....be happy don`t worry !!!
Again, not only the neighbours of Pakistan are in trouble but the greedy class and their barbarous, disgraced Army and ISI has made an hell to the citizens of whole Pakistan, including her mainland...Panjab. Why they are experiencing trouble, difficulties, inflation, Military dictator-ships, wars, countless self created crisis by ISI, sectarian crisis, ethnic battles? Is it not the result of
forcebly hold Balochistan in Pakistan? Why a common Pakistani is not welcommed in Western world to seek employment and they are suspected as Talibans/Quides or Qazis? The answer is ....Pakistani Army is attempting, unsuccessfuly, to keep their occupation over Balochistan and they are, like the insae beasts are "fighting the war of terror" against the whole world, specially against Afghanistan and India. Be happy & don`t worry, if Balochistan emerges as a free State.
The beneficial side-effects of the freedom of Balochistanshall be the freedom of the people of Panjab and rest of Pakistan i.e. to take the breath of freedom in democracy, freedom to speech, freedom for movement, economic freedom for an ordinary citizen of Pakistan and freedom to settle in the whole world. They can purchase the mineral resources of Balochistan on very cheap prices and Balochistan shall be their nice, truthworthy and friendly neighbour.
We do firmly beleive that an Independent Balochistan shall feed more Panjabis. A peaceful and free Balochistan shall need more labours, technicians and men of white collor.This gap can be filled-up not only bt Panjabi Balochs but also from central and eastern part of Panjab. On the other hand, the whole world, including India and Afghanistan, shall create golden opportunies to boost the economic opportunities for a peaceful Panjab/Pakistan. This can only happen if you don`t cry but be happy for..... an Independent, sovereign and free Balochistan which - in foreseeble future- shall help Panjab to not become a land-locked country. The chance are crystal clear that the Free Balochistan shall make a Union with Panjab, as we see, nowadays ..... in European Union.
Be happy & don`t worry about the freedom of Balochistan..
( The Global Friends of Balochs )
www.gwank.org
Taking The Predators To Balochistan
By B. Raman
The need for a regional counter-terrorism strategy to be spear-headed by India and the US for eradicating all terrorist sanctuaries in Pakistani territory has been one of the themes of my writings and lectures in the last two years. Extracts from two of the articles written by me on this subject on October 11, 2008, and January 1, 2009, are annexed.
2. It has been my belief that unless and until the US takes the initiative for such a strategy focused on eradicating all terrorist sanctuaries in Pakistani territory India will continue to bleed at the hands of jihadi terrorists spawned in Pakistan and the US will meet the same fate in Afghanistan as the erstwhile USSR did in the 1980s.
3. President Barack Obama’s strategy for the Af-Pak region is still unfolding in bits and pieces. A surge of 16,000 troops to start with and intensified Predator strikes on terrorist hide-outs and training camps in Pakistani territory are two components of this strategy, which are already under implementation. His administration has also been expanding the geographic and target spread of the Predator strikes. From North and South Waziristan and the Bajaur Agency in the Federally-Administered Tribal Areas (FATA), the geographic area of the strikes has been extended to the Kurram Agency in the FATA. The Bannu area in the North-West Frontier Province (NWFP), which was already targeted once by the Bush Administration, has been receiving more attention from the advisers of Obama.
4. The targets are also expanding. The initial targeting under the Bush Administration was mainly against the hide-outs and training camps of Al Qaeda and its associates such as the Afghan Taliban and the Islamic Movement of Uzbekistan (IMU) and the Islamic Jihad Union, which is also an Uzbeck group with many Europeans in it. Under Obama, the targets have been expanded to cover the hide-outs and training camps of the Tehrik-e-Taliban Pakistan (TTP) in all these areas and of Gulbuddin Heckmatyar’s Hizbe-Islami in the Kurram Agency.
5. A report carried by “the New York Times” and reproduced by the “Times of India” of March 19, 2009, indicates that the Obama Administration is also examining the advisability of hitting at the hide-outs and training camps of the Afghan Taliban in Quetta and some other areas of Balochistan adjoining the border with Afghanistan. Mulla Mohammad Omar, the Amir of the Neo Taliban, and his advisers are operating from sanctuaries in these areas.
6. In order to weaken the movement for Baloch independence , the late Gen. Zia-ul-Haq had got settled a large number of Afghan Pashtun refugees in these areas and given them Pakistani citizenship. It is in the midst of these pockets of citizens or residents of Afghan origin that the command and control of the Neo Taliban is located. Unless and until this command and control is targeted and eliminated, the US and other NATO troops will not be able to win the war against terrorism in the Af-Pak region.
7. Predator strikes on the sanctuaries of the Neo Taliban in the areas of Balochistan adjoining the Afghan border will be more difficult and tricky than the strikes now being carried out in the FATA. The targeted Balochistan areas may not be as sparsely populated as the targeted FATA areas. Unless there is precise intelligence, the dangers of civilian killings will be more. Human intelligence collection in the FATA area has already improved, indicating new capabilities now available to the Central Intelligence Agency (CIA) in this region. US intelligence officials must be confident of similar precise intelligence in respect of Balochistan too. Otherwise, recommendations would not have been made to Obama to expand the attacks to cover sanctuaries in Balochistan.
8. It is important that Obama gives his clearance to this recommendation as quickly as possible before the Neo Taliban launches its summer offensive in Afghanistan from its sanctuaries in the Balochistan area.
9. The policy already being followed by Obama and the change now recommended cover only attacks on the sanctuaries of Al Qaeda and its associates, the Neo Taliban, the TTP and the Hizb-e-Islami. They do not cover the group of five organizations----the Harkat-ul-Mujahideen (HUM), the Lashkar-e-Toiba (LET), the Harkat-ul-Jihad-al-Islami (HUJI), the Jaish-e-Mohammad (JEM) and the Lashkar-e-Jhangvi (LEJ)---- which are commonly referred to in Pakistan as the Punjabi Taliban.
10. The JEM has been helping the TTP in the Swat Valley of the NWFP. The LET has been helping the Neo Taliban and the Hizb-e-Islami in the Kabul area. It was involved in the explosion outside the Indian Embassy in Kabul in the first week of July last year. The HUM, the HUJI and the LEJ have been active in the tribal belt since the 1990s.
11. These organizations, except the LEJ, have been behind most acts of jihadi terrorism in the Indian territory. Unless the new US counter-terrorism strategy covers the terrorist infrastructure of the Punjabi Taliban too, the results will not be satisfactory.
12. It is here that the question of Indo-US operational co-operation comes in. The counter-terrorism co-operation between the intelligence agencies of India and the US has till now been confined to intelligence-sharing, mutual legal assistance in investigation of terrorist incidents and training for capacity building. Joint operations are practically nil.
13. The time has come for considering joint operations in the form of some of the Predators operating from bases in Indian territory and joint covert actions against the Punjabi Taliban. Such joint operations will be in the mutual interests of the two countries.
( The writer is Additional Secretary (retd), Cabinet Secretariat, Govt. of India, New Delhi, and, presently, Director, Institute For Topical Studies, Chennai. E-mail: seventyone2@gmail.com)
ANNEXURE
Extract from my article dated October 11, 2008 and titled “Seven Years of OP Enduring Freedom: No Light Yet” at http://www.southasiaanalysis.org/papers29/paper2877.html
The US and other NATO forces may want a political face-saving because they are not doing well in the fighting, but why should the Taliban Commanders want one when they think they are winning? The same is the situation on the Pakistan side of the border. The TTP thinks it is doing well against the Pakistani security forces. Why should it agree to a compromise without achieving its objective?
Gen. David Petraeus, who was till recently the Commander of the US forces in Iraq, is shortly taking over as the Commander of the US Central Command (has since taken over). In that capacity, he will be responsible for the strategy in the Afghanistan-Pakistan region. In Iraq, he successfully drove a wedge between the secular Iraqi resistance fighters and the Wahabised Arab terrorists of Al Qaeda. There is a talk that he might try a similar approach in the Afghanistan-Pakistan region by driving a wedge between the Taliban on both sides of the border and the Al Qaeda remnants. He succeeded in Iraq because the former Baathists of Saddam Hussein's Army, who constituted the resistance fighters, were secular and did not like the Wahabised Al Qaeda. But, in the Afghanistan-Pakistan region, Wahabism provides the binding ties which strongly unite the Talibans with Al Qaeda. They all feel that the future of Islam is going to be decided in the fight against the US-led NATO forces. They have two common objectives--- the defeat and withdrawal of the NATO forces and the proclamation of an Islamic sharia-based rule in the entire region. So long as these objectives unite them, the Talibans are unlikely to agree to separate peace with the NATO forces. Media reports of a split between the Afghan Taliban and Al Qaeda have not been substantiated.
Unless and until the US is able to hunt down and kill at least bin Laden, Zawahiri and Mulla Omar, there is unlikely to be a change in the ground situation. Instead of nursing illusions of engineering a split between Al Qaeda and the Taliban and negotiating a separate peace with the Taliban, the US should focus on eliminating the Al Qaeda leadership. That was the main objective of Op Enduring Freedom and that should continue to be its main objective.
Extract from my article dated January 1, 2009, and titled “Jihadi Terrorism--- 2008 & 2009: Part II & Last” at http://www.southasiaanalysis.org/papers30/paper2998.html
The success of the new policy will depend upon the neutralisation of the sanctuaries in Pakistani territory which keep the Taliban and Al Qaeda fighting against the US. The neutralisation of the sanctuaries of the Taliban is necessary for the success of the US-led forces and the ANA (Afghan National Army) in Afghanistan. Without the neutralisation of the Al Qaeda sanctuaries in Pakistani territory, the US cannot be free of fears of another 9/11 in the US homeland. Military and intelligence officers of the US realise that the US objectives vis-a-vis Al Qaeda and the Taliban cannot be met unless these sanctuaries are wiped out and the surviving leadership of Al Qaeda is neutralised. They also realise that missile and Predator strikes alone (over 30 during 2008 as compared to 10 during the previous two years) cannot achieve their objective unless combined with clandestine strikes by land-based stealth forces. They did attempt one such strike in September in South Waziristan. It was not successful and the furore in Pakistan over it led to their abandoning any more land-based strikes in Pakistani territory.
The US finds itself in the same position as the USSR found itself in Afghanistan before it decided to quit in 1988. The Soviet troops avoided land-based action against the sanctuaries of the Afghan Mujahideen in Pakistani territory. They confined their retaliatory strikes to Scud missiles fired at the suspected hide-outs of the Mujahideen in Pakistani territory. The civilian deaths caused by the Scuds added to the anger among the Afghan refugees and strengthened their determination to step up their attacks on the Soviet troops in Afghan territory and on Soviet convoys taking logistics supplies to the far-flung Soviet posts. The Mujahideen's success in disrupting the logistics supplies was one of the factors, which contributed to the Soviet decision to quit.
The Afghan and Pakistani Taliban, advised by retired officers of the Inter-Services Intelligence (ISI) such as Lt. Gen. Hamid Gul, are following against the US-led forces the same strategy which the Mujahideen had followed against the Soviet troops-----keeping them bleeding and trying to starve them of essential supplies. In addition to keeping up a high level of suicide and other terrorism in Afghan territory to disrupt road movements of troops and supplies and weaken the control of the ANA in towns, they have stepped up their attacks on road movement of supplies for the NATO forces from Karachi. The US is trying to work out alternate routes through Russia, Georgia and the Central Asian Republics (CARs). It remains to be seen how satisfactory the proposed new supply routes will be.
When Obama's advisers talk of a regional strategy, they mean being responsive to Pakistan's perceived unhappiness and concerns. If they do it, they can exercise more pressure on the Pakistan Army to deal with the sanctuaries and if and when Pakistan does it, it will benefit not only the US, but also India. So their argument goes. This is pure wishful thinking and betrays a failure to comprehend the Pakistani mind-set. Pakistan looks upon the various terrorist groups operating from its territory ----whether against India or Afghanistan or the US---- as strategic assets to limit the power of India and its influence in Afghanistan and the CARs. It is not going to voluntarily give up these perceived assets, unless forced to do so.
The inaction or inability or both of successive Pakistan Governments has enabled Al Qaeda, the Afghan Taliban, the Pakistani Taliban, the anti-India terrorist organisations, the Islamic Movement of Uzbekistan (IMU), the Islamic Jihad Group ( (IJG) and radicalised members of the Pakistani diaspora in Europe and North America acquire a strategic depth in the tribal belt of Pakistan from where they can operate wherever they want all over the world----whether against India or Afghanistan or the West or Russia or even against Pakistan if it co-operates too closely with the US.
What the Obama administration would need is a regional strategy to eliminate the terrorirst sanctuaries in Pakistani territory and to deprive the jihadi terrorists of the world of the strategic depth which they presently enjoy in Pakistani territory. This is a strategy on which the US and India can closely collaborate as and when Obama and his advisers come out of their present mode of wishful thinking.
The need for a regional counter-terrorism strategy to be spear-headed by India and the US for eradicating all terrorist sanctuaries in Pakistani territory has been one of the themes of my writings and lectures in the last two years. Extracts from two of the articles written by me on this subject on October 11, 2008, and January 1, 2009, are annexed.
2. It has been my belief that unless and until the US takes the initiative for such a strategy focused on eradicating all terrorist sanctuaries in Pakistani territory India will continue to bleed at the hands of jihadi terrorists spawned in Pakistan and the US will meet the same fate in Afghanistan as the erstwhile USSR did in the 1980s.
3. President Barack Obama’s strategy for the Af-Pak region is still unfolding in bits and pieces. A surge of 16,000 troops to start with and intensified Predator strikes on terrorist hide-outs and training camps in Pakistani territory are two components of this strategy, which are already under implementation. His administration has also been expanding the geographic and target spread of the Predator strikes. From North and South Waziristan and the Bajaur Agency in the Federally-Administered Tribal Areas (FATA), the geographic area of the strikes has been extended to the Kurram Agency in the FATA. The Bannu area in the North-West Frontier Province (NWFP), which was already targeted once by the Bush Administration, has been receiving more attention from the advisers of Obama.
4. The targets are also expanding. The initial targeting under the Bush Administration was mainly against the hide-outs and training camps of Al Qaeda and its associates such as the Afghan Taliban and the Islamic Movement of Uzbekistan (IMU) and the Islamic Jihad Union, which is also an Uzbeck group with many Europeans in it. Under Obama, the targets have been expanded to cover the hide-outs and training camps of the Tehrik-e-Taliban Pakistan (TTP) in all these areas and of Gulbuddin Heckmatyar’s Hizbe-Islami in the Kurram Agency.
5. A report carried by “the New York Times” and reproduced by the “Times of India” of March 19, 2009, indicates that the Obama Administration is also examining the advisability of hitting at the hide-outs and training camps of the Afghan Taliban in Quetta and some other areas of Balochistan adjoining the border with Afghanistan. Mulla Mohammad Omar, the Amir of the Neo Taliban, and his advisers are operating from sanctuaries in these areas.
6. In order to weaken the movement for Baloch independence , the late Gen. Zia-ul-Haq had got settled a large number of Afghan Pashtun refugees in these areas and given them Pakistani citizenship. It is in the midst of these pockets of citizens or residents of Afghan origin that the command and control of the Neo Taliban is located. Unless and until this command and control is targeted and eliminated, the US and other NATO troops will not be able to win the war against terrorism in the Af-Pak region.
7. Predator strikes on the sanctuaries of the Neo Taliban in the areas of Balochistan adjoining the Afghan border will be more difficult and tricky than the strikes now being carried out in the FATA. The targeted Balochistan areas may not be as sparsely populated as the targeted FATA areas. Unless there is precise intelligence, the dangers of civilian killings will be more. Human intelligence collection in the FATA area has already improved, indicating new capabilities now available to the Central Intelligence Agency (CIA) in this region. US intelligence officials must be confident of similar precise intelligence in respect of Balochistan too. Otherwise, recommendations would not have been made to Obama to expand the attacks to cover sanctuaries in Balochistan.
8. It is important that Obama gives his clearance to this recommendation as quickly as possible before the Neo Taliban launches its summer offensive in Afghanistan from its sanctuaries in the Balochistan area.
9. The policy already being followed by Obama and the change now recommended cover only attacks on the sanctuaries of Al Qaeda and its associates, the Neo Taliban, the TTP and the Hizb-e-Islami. They do not cover the group of five organizations----the Harkat-ul-Mujahideen (HUM), the Lashkar-e-Toiba (LET), the Harkat-ul-Jihad-al-Islami (HUJI), the Jaish-e-Mohammad (JEM) and the Lashkar-e-Jhangvi (LEJ)---- which are commonly referred to in Pakistan as the Punjabi Taliban.
10. The JEM has been helping the TTP in the Swat Valley of the NWFP. The LET has been helping the Neo Taliban and the Hizb-e-Islami in the Kabul area. It was involved in the explosion outside the Indian Embassy in Kabul in the first week of July last year. The HUM, the HUJI and the LEJ have been active in the tribal belt since the 1990s.
11. These organizations, except the LEJ, have been behind most acts of jihadi terrorism in the Indian territory. Unless the new US counter-terrorism strategy covers the terrorist infrastructure of the Punjabi Taliban too, the results will not be satisfactory.
12. It is here that the question of Indo-US operational co-operation comes in. The counter-terrorism co-operation between the intelligence agencies of India and the US has till now been confined to intelligence-sharing, mutual legal assistance in investigation of terrorist incidents and training for capacity building. Joint operations are practically nil.
13. The time has come for considering joint operations in the form of some of the Predators operating from bases in Indian territory and joint covert actions against the Punjabi Taliban. Such joint operations will be in the mutual interests of the two countries.
( The writer is Additional Secretary (retd), Cabinet Secretariat, Govt. of India, New Delhi, and, presently, Director, Institute For Topical Studies, Chennai. E-mail: seventyone2@gmail.com)
ANNEXURE
Extract from my article dated October 11, 2008 and titled “Seven Years of OP Enduring Freedom: No Light Yet” at http://www.southasiaanalysis.org/papers29/paper2877.html
The US and other NATO forces may want a political face-saving because they are not doing well in the fighting, but why should the Taliban Commanders want one when they think they are winning? The same is the situation on the Pakistan side of the border. The TTP thinks it is doing well against the Pakistani security forces. Why should it agree to a compromise without achieving its objective?
Gen. David Petraeus, who was till recently the Commander of the US forces in Iraq, is shortly taking over as the Commander of the US Central Command (has since taken over). In that capacity, he will be responsible for the strategy in the Afghanistan-Pakistan region. In Iraq, he successfully drove a wedge between the secular Iraqi resistance fighters and the Wahabised Arab terrorists of Al Qaeda. There is a talk that he might try a similar approach in the Afghanistan-Pakistan region by driving a wedge between the Taliban on both sides of the border and the Al Qaeda remnants. He succeeded in Iraq because the former Baathists of Saddam Hussein's Army, who constituted the resistance fighters, were secular and did not like the Wahabised Al Qaeda. But, in the Afghanistan-Pakistan region, Wahabism provides the binding ties which strongly unite the Talibans with Al Qaeda. They all feel that the future of Islam is going to be decided in the fight against the US-led NATO forces. They have two common objectives--- the defeat and withdrawal of the NATO forces and the proclamation of an Islamic sharia-based rule in the entire region. So long as these objectives unite them, the Talibans are unlikely to agree to separate peace with the NATO forces. Media reports of a split between the Afghan Taliban and Al Qaeda have not been substantiated.
Unless and until the US is able to hunt down and kill at least bin Laden, Zawahiri and Mulla Omar, there is unlikely to be a change in the ground situation. Instead of nursing illusions of engineering a split between Al Qaeda and the Taliban and negotiating a separate peace with the Taliban, the US should focus on eliminating the Al Qaeda leadership. That was the main objective of Op Enduring Freedom and that should continue to be its main objective.
Extract from my article dated January 1, 2009, and titled “Jihadi Terrorism--- 2008 & 2009: Part II & Last” at http://www.southasiaanalysis.org/papers30/paper2998.html
The success of the new policy will depend upon the neutralisation of the sanctuaries in Pakistani territory which keep the Taliban and Al Qaeda fighting against the US. The neutralisation of the sanctuaries of the Taliban is necessary for the success of the US-led forces and the ANA (Afghan National Army) in Afghanistan. Without the neutralisation of the Al Qaeda sanctuaries in Pakistani territory, the US cannot be free of fears of another 9/11 in the US homeland. Military and intelligence officers of the US realise that the US objectives vis-a-vis Al Qaeda and the Taliban cannot be met unless these sanctuaries are wiped out and the surviving leadership of Al Qaeda is neutralised. They also realise that missile and Predator strikes alone (over 30 during 2008 as compared to 10 during the previous two years) cannot achieve their objective unless combined with clandestine strikes by land-based stealth forces. They did attempt one such strike in September in South Waziristan. It was not successful and the furore in Pakistan over it led to their abandoning any more land-based strikes in Pakistani territory.
The US finds itself in the same position as the USSR found itself in Afghanistan before it decided to quit in 1988. The Soviet troops avoided land-based action against the sanctuaries of the Afghan Mujahideen in Pakistani territory. They confined their retaliatory strikes to Scud missiles fired at the suspected hide-outs of the Mujahideen in Pakistani territory. The civilian deaths caused by the Scuds added to the anger among the Afghan refugees and strengthened their determination to step up their attacks on the Soviet troops in Afghan territory and on Soviet convoys taking logistics supplies to the far-flung Soviet posts. The Mujahideen's success in disrupting the logistics supplies was one of the factors, which contributed to the Soviet decision to quit.
The Afghan and Pakistani Taliban, advised by retired officers of the Inter-Services Intelligence (ISI) such as Lt. Gen. Hamid Gul, are following against the US-led forces the same strategy which the Mujahideen had followed against the Soviet troops-----keeping them bleeding and trying to starve them of essential supplies. In addition to keeping up a high level of suicide and other terrorism in Afghan territory to disrupt road movements of troops and supplies and weaken the control of the ANA in towns, they have stepped up their attacks on road movement of supplies for the NATO forces from Karachi. The US is trying to work out alternate routes through Russia, Georgia and the Central Asian Republics (CARs). It remains to be seen how satisfactory the proposed new supply routes will be.
When Obama's advisers talk of a regional strategy, they mean being responsive to Pakistan's perceived unhappiness and concerns. If they do it, they can exercise more pressure on the Pakistan Army to deal with the sanctuaries and if and when Pakistan does it, it will benefit not only the US, but also India. So their argument goes. This is pure wishful thinking and betrays a failure to comprehend the Pakistani mind-set. Pakistan looks upon the various terrorist groups operating from its territory ----whether against India or Afghanistan or the US---- as strategic assets to limit the power of India and its influence in Afghanistan and the CARs. It is not going to voluntarily give up these perceived assets, unless forced to do so.
The inaction or inability or both of successive Pakistan Governments has enabled Al Qaeda, the Afghan Taliban, the Pakistani Taliban, the anti-India terrorist organisations, the Islamic Movement of Uzbekistan (IMU), the Islamic Jihad Group ( (IJG) and radicalised members of the Pakistani diaspora in Europe and North America acquire a strategic depth in the tribal belt of Pakistan from where they can operate wherever they want all over the world----whether against India or Afghanistan or the West or Russia or even against Pakistan if it co-operates too closely with the US.
What the Obama administration would need is a regional strategy to eliminate the terrorirst sanctuaries in Pakistani territory and to deprive the jihadi terrorists of the world of the strategic depth which they presently enjoy in Pakistani territory. This is a strategy on which the US and India can closely collaborate as and when Obama and his advisers come out of their present mode of wishful thinking.
Venezuela and Colombia Deepen Diplomatic and Economic Ties
March 20th 2009, by James Suggett - Venezuelanalysis.com
(Venezuelanalysis.com) -- Venezuelan Foreign Relations Minister Nicolás Maduro and Colombian Foreign Relations Minister Jaime Bermúdez met in Caracas Wednesday to discuss commercial relations and anti-drug policy, demonstrating the first efforts at reconciliation between the two countries since a heated exchange in early March over Colombia's justification of cross-border raids on guerrilla rebels.
"Venezuela and Colombia are two governments with the willingness and capacity to approach one another, broadly discuss and concretize their ideas to move forward on projects that benefit both countries in the midst of uncertainty in the world economy," said Maduro during a press conference alongside Bermúdez.
"The world can observe a plural Latin America agreeing upon and advancing on its own path," Maduro added.
Regarding energy policy, the two ministers discussed their policies on biofuels, electricity, and the environmental impact of energy production and consumption, and moved forward on plans to build an oil pipeline from Venezuela's Orinoco Oil Belt to Colombia.
They also exchanged ideas about how to better organize the gasoline trade at the border, where the smuggling of Venezuela's heavily subsidized gasoline thrives.
Maduro and Bermúdez also spoke about the automobile industry, including the potential expansion of import and export quotas between the two nations and a technology sharing agreement to promote the conversion of cars to dual gasoline-natural gas engines.
A joint investment fund of $200 million and agricultural stimulus were also on the agenda Wednesday, but the ministers said they plan to consult with their respective presidents, Álvaro Uribe of Colombia and Hugo Chávez of Venezuela, before making any final decisions.
The potential fund will be "a new bi-national financial institution that is aimed, overall, at maintaining and growing the flow of investments in the midst of the current economic crisis that spreads across the world," Maduro told the press. "In the first semester of this year we hope to make decisions on economic accords aimed at complementary, integral commercial development," he said.
Minister Bermúdez thanked Venezuela for supporting its successful bid for the presidency of the Association of Caribbean States in January. Regarding Wednesday's meeting, he said, "There is definitely an enormous agenda that obligates us to advance side-by-side in common projects, even more so with the financial crisis."
Bermúdez asked Venezuela to accompany Colombia in the struggle to halt drug trafficking, which has been a major source of funding for both sides of Colombia's four-decade civil conflict between rebel guerrillas and the government.
"It is fundamental to emphasize that a definitive triumph in the fight against drug trafficking will be achieved with the un-conditional support of the entire international community," said Bermúdez.
Maduro said Venezuela is committed to combating drug trafficking through Venezuela, highlighting the sharp increase in drug interdictions and the eradication of drug laboratories from Venezuelan territory over the past three years. Maduro also invited the director of Venezuela's National Anti-Drug Office, Néstor Reverol, to participate in Wednesday's meetings.
In response to Venezuela's repeated warnings to Colombia to keep drug-related fumigations out of Venezuelan territory, Bermúdez promised not to fumigate within ten kilometers of the border. "There are no fumigations foreseen along the border with Venezuela, but we do plan to fumigate in the north of Santander in municipalities that lie as close as 25 kilometers from the border," he said.
Both ministers said they will consider the possibility of coordinating drug policy directly with one another.
The friendly tone of Wednesday's meeting contrasted sharply with the diplomatic clash earlier this month after Colombian Defense Minister Juan Manuel Santos said Colombia's bombardment of an encampment of the Revolutionary Armed Forces of Colombia (FARC) in Ecuadoran territory one year ago was a justifiable act of self-defense.
Chávez said Santos's declaration threatens to destabilize the region and violates a peace-keeping agreement signed by all South American heads of state shortly after last year's attacks.
President Chávez has been an enthusiastic advocate of regional integration initiatives as a tool to endure the effects of the global economic crisis. Colombia participates in one of these integration blocs, the Union of South American Nations (UNASUR), but not in others, such as the cooperation-based trade bloc called the Bolivarian Alternative for the Americas (ALBA), an alternative to U.S.-dominated free trade deals.
Despite periodic conflicts and heated exchanges, President Chávez and President Uribe have met regularly over the past five years to sign economic accords and craft large-scale infrastructure projects that are a part of South American Inter-Regional Infrastructure (IIRSA), which are financed in part by the Inter-American Development Bank and the World Bank.
Maduro highlighted this history of cooperation Wednesday. "This meeting is the continuation of the ongoing effort to contribute to the positive work agenda, an agenda of peace and integration between both governments," said Maduro.
(Venezuelanalysis.com) -- Venezuelan Foreign Relations Minister Nicolás Maduro and Colombian Foreign Relations Minister Jaime Bermúdez met in Caracas Wednesday to discuss commercial relations and anti-drug policy, demonstrating the first efforts at reconciliation between the two countries since a heated exchange in early March over Colombia's justification of cross-border raids on guerrilla rebels.
"Venezuela and Colombia are two governments with the willingness and capacity to approach one another, broadly discuss and concretize their ideas to move forward on projects that benefit both countries in the midst of uncertainty in the world economy," said Maduro during a press conference alongside Bermúdez.
"The world can observe a plural Latin America agreeing upon and advancing on its own path," Maduro added.
Regarding energy policy, the two ministers discussed their policies on biofuels, electricity, and the environmental impact of energy production and consumption, and moved forward on plans to build an oil pipeline from Venezuela's Orinoco Oil Belt to Colombia.
They also exchanged ideas about how to better organize the gasoline trade at the border, where the smuggling of Venezuela's heavily subsidized gasoline thrives.
Maduro and Bermúdez also spoke about the automobile industry, including the potential expansion of import and export quotas between the two nations and a technology sharing agreement to promote the conversion of cars to dual gasoline-natural gas engines.
A joint investment fund of $200 million and agricultural stimulus were also on the agenda Wednesday, but the ministers said they plan to consult with their respective presidents, Álvaro Uribe of Colombia and Hugo Chávez of Venezuela, before making any final decisions.
The potential fund will be "a new bi-national financial institution that is aimed, overall, at maintaining and growing the flow of investments in the midst of the current economic crisis that spreads across the world," Maduro told the press. "In the first semester of this year we hope to make decisions on economic accords aimed at complementary, integral commercial development," he said.
Minister Bermúdez thanked Venezuela for supporting its successful bid for the presidency of the Association of Caribbean States in January. Regarding Wednesday's meeting, he said, "There is definitely an enormous agenda that obligates us to advance side-by-side in common projects, even more so with the financial crisis."
Bermúdez asked Venezuela to accompany Colombia in the struggle to halt drug trafficking, which has been a major source of funding for both sides of Colombia's four-decade civil conflict between rebel guerrillas and the government.
"It is fundamental to emphasize that a definitive triumph in the fight against drug trafficking will be achieved with the un-conditional support of the entire international community," said Bermúdez.
Maduro said Venezuela is committed to combating drug trafficking through Venezuela, highlighting the sharp increase in drug interdictions and the eradication of drug laboratories from Venezuelan territory over the past three years. Maduro also invited the director of Venezuela's National Anti-Drug Office, Néstor Reverol, to participate in Wednesday's meetings.
In response to Venezuela's repeated warnings to Colombia to keep drug-related fumigations out of Venezuelan territory, Bermúdez promised not to fumigate within ten kilometers of the border. "There are no fumigations foreseen along the border with Venezuela, but we do plan to fumigate in the north of Santander in municipalities that lie as close as 25 kilometers from the border," he said.
Both ministers said they will consider the possibility of coordinating drug policy directly with one another.
The friendly tone of Wednesday's meeting contrasted sharply with the diplomatic clash earlier this month after Colombian Defense Minister Juan Manuel Santos said Colombia's bombardment of an encampment of the Revolutionary Armed Forces of Colombia (FARC) in Ecuadoran territory one year ago was a justifiable act of self-defense.
Chávez said Santos's declaration threatens to destabilize the region and violates a peace-keeping agreement signed by all South American heads of state shortly after last year's attacks.
President Chávez has been an enthusiastic advocate of regional integration initiatives as a tool to endure the effects of the global economic crisis. Colombia participates in one of these integration blocs, the Union of South American Nations (UNASUR), but not in others, such as the cooperation-based trade bloc called the Bolivarian Alternative for the Americas (ALBA), an alternative to U.S.-dominated free trade deals.
Despite periodic conflicts and heated exchanges, President Chávez and President Uribe have met regularly over the past five years to sign economic accords and craft large-scale infrastructure projects that are a part of South American Inter-Regional Infrastructure (IIRSA), which are financed in part by the Inter-American Development Bank and the World Bank.
Maduro highlighted this history of cooperation Wednesday. "This meeting is the continuation of the ongoing effort to contribute to the positive work agenda, an agenda of peace and integration between both governments," said Maduro.
March 20, 2009
The Federal Reserve is Bankrupt
http://www.vijayvaa ni.com/FrmPublic DisplayArticle. aspx?id=450
Matthias Chang
20 March 2009
The Federal Reserve is bankrupt for all intents and purposes. The same goes for the Bank of England ! This article will focus largely on the Fed, because the Fed is the “financial land-mine”. How long can someone who has stepped on a landmine, remain standing – hours, days? Eventually, when he is exhausted and his legs give way, the mine will just explode! The shadow banking system has not only stepped on the land-mine, it is carrying such a heavy load (trillions of toxic wastes) that sooner or later it will tilt, give way and trigger off the land-mine![1]
In a recent article, I referred to the remarks of British Prime Minister Gordon Brown and President Obama calling for the shadow banking system to be outlawed. Even if the call was genuine, it is too late. The land-mine has been triggered and the explosion cannot be averted under any circumstances. The only issue is the extent of the damage to the global economy and how long it will take for the world to recover from this fiasco – a financial madness that has no precedent. The great depression is “Mary Poppins” in comparison!
The idea of a central bank going bankrupt is not that outlandish. I am by no means the first author who has given this stark warning. What underlies this crisis (which I initially examined in an article in December 2006) is the potential collapse of the global banking system, specifically the Shadow Money-Lenders.
Nouriel Roubini, the New York University professor said [2]:
“The process of socialising the private losses from this crisis has moved many of the liabilities of the private sector onto the books of the sovereign. At some point a sovereign bank may crack, in which case, the ability of the government to credibly commit to act as a backstop for the financial system – including deposit guarantees – could come unglued.”
Please read the underlined words again. “Sovereign bank” means central bank. When a central bank “cracks” i.e. becomes insolvent, “all hell breaks lose”, because as the professor correctly pointed out, “any government guarantees will ring hollow and will be useless”. If a central bank goes belly up, it is as good as the government going bankrupt. Period!
In another article, Roubini admitted that the pressure on “the financial land-mine” is totally unbearable. He wrote: “The US Financial system is effectively insolvent”. It follows that if the financial system is bankrupt, it is a matter of time before the “sovereign bank” goes belly up. This is a given!
He stated further that:
“Thus, the U.S. financial system is de facto nationalized, as the Federal Reserve has become the lender of first and only resort rather than the lender of last resort, and the U.S. Treasury is the spender and guarantor of first and only resort. The only issue is whether banks and financial institutions should also be nationalized de jure.
“AIG which lost $62 billion in the fourth quarter and $99 billion in all of 2008 is already 80% government-owned. With such staggering losses, it should be formally 100% government-owned. And now the Fed and Treasury commitments of public resources to the bailout of the shareholders and creditors of AIG have gone from $80 billion to $162 billion.
“Given that common shareholders of AIG are already effectively wiped out (the stock has become a penny stock), the bailout of AIG is a bailout of the creditors of AIG that would now be insolvent without such a bailout. AIG sold over $500 billion of toxic credit default swap protection, and the counter-parties of this toxic insurance are major U.S. broker-dealers and banks.
“News and banks analysts' reports suggested that Goldman Sachs got about $25 billion of the government bailout of AIG and that Merrill Lynch was the second largest benefactor of the government largesse. These are educated guesses, as the government is hiding the counter-party benefactors of the AIG bailout. (Maybe Bloomberg should sue the Fed and Treasury again to have them disclose this information. )
“But some things are known: Goldman's Lloyd Blankfein was the only CEO of a Wall Street firm who was present at the New York Fed meeting when the AIG bailout was discussed. So let us not kid each other: The $162 billion bailout of AIG is a non-transparent, opaque and shady bailout of the AIG counter-parties: Goldman Sachs, Merrill Lynch and other domestic and foreign financial institutions.
“So for the Treasury to hide behind the “systemic risk” excuse to fork out another $30 billion to AIG is a polite way to say that without such a bailout (and another half-dozen government bailout programs such as TAF, TSLF, PDCF, TARP, TALF and a programme that allowed $170 billion of additional debt borrowing by banks and other broker-dealers, with a full government guarantee), Goldman Sachs and every other broker-dealer and major U.S. bank would already be fully insolvent today.
“And even with the $2 trillion of government support, most of these financial institutions are insolvent, as delinquency and charge-off rates are now rising at a rate - given the macro outlook - that means expected credit losses for U.S. financial firms will peak at $3.6 trillion. So, in simple words, the U.S. financial system is effectively insolvent.”
McClatchy newspaper reported (03/08/2009) bad news affecting the banks:
“America's five largest banks, which already have received $145 billion in taxpayer bailout dollars, still face potentially catastrophic losses from exotic investments if economic conditions substantially worsen, their latest financial reports show.
“Citibank, Bank of America, HSBC Bank USA, Wells Fargo Bank and J.P. Morgan Chase reported that their “current” net loss risks from derivatives — insurance-like bets tied to a loan or other underlying asset — surged to $587 billion as of Dec. 31. Buried in end-of-the-year regulatory reports that McClatchy has reviewed, the figures reflect a jump of 49 percent in just 90 days.
“The disclosures underscore the challenges that the banks face as they struggle to navigate through a deepening recession in which all types of loan defaults are soaring.
“The government has since committed $182 billion to rescue AIG and, indirectly, investors on the other end of the firm's swap contracts. AIG posted a fourth quarter 2008 loss last week of more than $61 billion, the worst quarterly performance in U.S. corporate history.
“The five major banks, which account for more than 95 percent of U.S. banks' trading in this array of complex derivatives, declined to say how much of the AIG bailout money flowed to them to make good on these contracts.
“The banks' quarterly financial reports show that as of Dec. 31:
— J.P. Morgan had potential current derivatives losses of $241.2 billion, outstripping its $144 billion in reserves, and future exposure of $299 billion.
— Citibank had potential current losses of $140.3 billion, exceeding its $108 billion in reserves, and future losses of $161.2 billion.
— Bank of America reported $80.4 billion in current exposure, below its $122.4 billion reserve, but $218 billion in total exposure.
— HSBC Bank USA had current potential losses of $62 billion, more than triple its reserves, and potential total exposure of $95 billion.
— San Francisco-based Wells Fargo, which agreed to take over Charlotte-based Wachovia in October, reported current potential losses totalling nearly $64 billion, below the banks' combined reserves of $104 billion, but total future risks of about $109 billion.
“Kopff, the bank shareholders' expert, said that several of the big banks' risks are so large that they are “dead men walking.”
Berkshire Hathaway Chairman, Warren Buffett is so livid by the sheer magnitude of the financial mess that he said:
“These instruments [derivatives] have made it almost impossible for investors to understand and analyze our largest commercial banks and investment banks . . . When I read the pages of 'disclosure' in (annual reports) of companies that are entangled with these instruments, all I end up knowing is that I don't know what is going on in their portfolios. And then I reach for some aspirin.”
The above bad news refers to the losses and potential losses that the big banks have suffered and will suffer in the near future. But what is overlooked by many financial analysts is that these very same derivative products have caused another financial organ failure. And there is no way that the said organ can be resuscitated to its former state of health.
The Repo Market is gridlocked!
There has been an incestuous relationship between the traditional banking system and the shadow banking system and the link that joined the two together is the Repo Market [Repurchase Market]. This is in fact the weakest link in the entire financial system.
This is a very technical subject and I seek your indulgence and patience when reading the remaining part of this article. The gridlock of the repo market is the basis for my assertion that over and above the aforesaid dire financial facts, it is the major contributing factor to the bankruptcy of the Federal Reserve!
I want to use a simple analogy. This will make the issue easier to understand. Picture a one-inch diameter thick rope. Such a rope is made up of a few strands of narrower ropes, say 1/10th inch which are twined together to make the thick one-inch diameter rope. Picture again that all the outer strands have been burnt away, and what remains is the middle strand, still lifting the weight. But this strand cannot on its own lift such a weight, and sooner or later it will snap. When that happens, the weight will come crashing down! The middle strand is the repo market.
Alternatively, you can use the analogy that the repo market is the heart that pumps the blood (the cash flow). The financial system is the body and it has suffered a massive heart attack! What is the repo market? The repo market is the market whereby all financial institutions (regulated and unregulated) invariably go to obtain financing to meet reserve requirements, bridging finance, to lend or purchase securities, to hedge and or to invest on short-term basis.
It used to be that mainly US Treasuries (bear this in mind at all times) were used as security for Repo transactions, as it is considered as most secure i.e. as good as cash since it is backed by the credit of the US government! This requirement is no longer the case. More of this issue later.
The Nature of Repo Transactions
In repo transactions, securities are exchanged for cash with an agreement to repurchase the securities at a future date. The securities serve as collateral for what is effectively a cash loan. A distinguishing feature of repos is that they can be used either to obtain funds or to obtain securities. As repos are short-maturity collateralized instruments, repo markets have strong linkages with securities markets, derivative markets and other short term markets such as inter-bank and money markets. [3]
Like other financial markets, repo markets are subject to credit risks, operational risks and liquidity risks. However, what distinguishes the credit risks on repos from that associated with uncollateralized instruments is that repos credit exposures arise from volatility (or market risk) in the value of collateral. Bear this in mind at all times.
Repos allow institutions to use leverage to take larger positions in financial markets which could add to systemic risks. Bear this in mind at all times.
And because of the close linkages between repo markets and securities markets, any shocks will be transmitted quickly, resulting in a gridlock. Bear this in mind at all times.
Transactions covered by definition of repos are as follows:
(A) Repurchase Agreement
A repurchase agreement involves the sale of an asset under an agreement to repurchase the asset from the same counter-party. Interest is paid on the repurchase agreement by adjusting the sale and purchase price. A reverse repo is the purchase of an asset with an agreement to re-sell the same or a similar asset.
A hold-in-custody repurchase agreement is a trade whereby the repoer (the borrower of cash) continues to hold the collateralizing securities in custody for the lender of cash. The risks are obvious!
A deliver-out repurchase agreement is where securities are delivered to the cash lender for custody in exchange for cash.
A tri-party repurchase agreement is similar to a deliver-out repurchase agreement, except that the security is placed in the custody of a third-party entity. The third-party ensures that the security meets the cash lender's requirements and provides valuation and margining services. This is the primary form of repurchase agreement for securities dealers in the United States . Bank of New York and JP Morgan Chase are the two main custodians or clearing banks in the US and supervise the vast majority of the tri-party repos. Bear this in mind at all times.
(B) Sell/Buy-Back Agreement
A sell buy-back is two distinct outright cash market trades, one for forward settlement. The forward price is set relative to the spot price to yield a market rate of return.
(C) Securities Lending
This is where the owner of the security lends them to another person in return for a fee. The borrower of the security is contractually obliged to redeliver a like quantity of the same securities, or return precisely the same securities.
Repos can be of any duration but are most commonly over-night loans. Repos longer than over-night are called Term Repos. There are also Open Repos which are transactions which can be terminated by both parties on a day's notice.
The largest players of repos and reverses are the dealers in government securities. There are about 20 primary dealers recognised by the Fed which are authorised to bid for new-issued treasury securities for resale in the market. The dealers are highly leveraged, 50 to 100 times their own capital. To finance the purchase of treasury securities, the dealers need to have repo monies in large amounts on a continuing basis. The institutions that supply such huge funds in the repo market are money funds, large corporations, state and local governments and foreign central banks.
The Repo Market and the Financial Crisis
As stated earlier when the repo market first started, US treasuries were the preferred security. But when financial engineering exploded and many financial products (i.e. CDOs) were rated AAA by rating agencies, these securities were also traded as described above in the repo market. This was when problems started.
According to Gary Gorton [4], the repo market before the crisis was estimated to be worth a whopping $12 trillion as compared to the total assets in the entire US banking system of $10 trillion.
The former CEO of Federal Reserve Bank of New York (NYFRB) and now the US Treasury Secretary, Tim Geithner observed in 2008:
“The structure of the financial system changed fundamentally during the boom, with dramatic growth in the share of assets outside the traditional banking system. This non-bank financial system grew to be very large, particularly in money and funding markets.
“This parallel system financed some of these very assets on a very short term basis in the bilateral or tri-party repo markets. As the volume of activity in repo markets grew, the variety of assets financed in this manner expanded beyond the most highly liquid securities to include less liquid securities, as well. Nonetheless, these assets were assumed to be readily sellable at fair values, in part because assets with similar credit ratings had generally been tradable during past periods of financial stress. And the liquidity supporting them was assumed to be continuous and essentially frictionless, because it had been so for a long time.
“The scale of long term risky and relatively illiquid assets financed by very short-term liabilities made many of the vehicles and institutions in this parallel financial system vulnerable to a classic type run, but without the protection such as deposit insurance that the banking system has in place to reduce such risks.”
Economic historians will argue for another century as to the cause for the run on the repo market. The collapse of Bear Stearns is as good a starting point as any. When the market discovered that its securities were duds, pure junk, shock waves ripped through the system. Recall that I had mentioned earlier that Federal Bank of New York and JP Morgan Chase were the primary clearing banks for repos.
The Fed's rescue of Bear Stearns through JP Morgan was not so much to save the former but rather to shore up the “clearing system” of the repos for which JP Morgan Chase and the Bank of New York were the main pillars. One of the functions of a “clearing bank” for repos is to value and match securities tendered for cash borrowings. If Bear Stearns securities are now valued as junks, the integrity of JP Morgan and Federal Bank of New York as clearing banks in this market is as good as zero! And bearing in mind that the five major investment banks in the US rely heavily on the repo market for their funding, any gridlock in this part of the shadow banking system would tear wide open the entire banking system, including the traditional counter-part.
Hence, the FED intervention by the creation of the Primary Dealer Credit Facility (PDCF), which was in effect the backstop for all investment banking using tri-party repos! This was what Bernanke said:
“We have been working with market participants to develop a contingency plan should there ever occur a loss of confidence in either of the two clearing banks that facilitate the settlement of tri-party repos.”
Louis Crandall, economist at Wrightson ICAP observed:
“The vulnerability of the tri-party repo system has been a recurring theme among Federal Reserve and Treasury officials in recent weeks.”
The inherent weakness of tri-party repos is that the counter-party risks of billions worth of funding agreements are shouldered by essentially two players – Federal Bank of New York and JP Morgan Chase. Yet, way back then, they were held up as rock solid. It is almost hilarious to read the then advert of the Federal Bank of New York as to their expertise and service:
“Sophisticated collateral selection: enforce diversification and credit quality; control adequacy, volatility & liquidity.
“Cutting edge infrastructure: economies of scale facilitate extensive data warehousing, access to more asset classes and markets, auto-substitution, auto-allocation & optimisation technology, same day reporting.
“Introduction to new counterparts: A Global Collateral Clearing House.”
Panic swept across the entire repo market. No securities were considered safe enough for repos except US treasuries. Fundings in the repo market grind to a halt. Market players withdrew funds and began hoarding treasuries. The rest who own structured products were slaughtered.
I would like to quote Gary Gorton again:
“Imagine a firm that is levered 30:1, by borrowing in the repo market. If the haircut [5] doubles, or goes from zero to a positive amount, the required deleveraging is massive! Most investment banks were levered 30:1, equivalent to about a 3 per cent haircut. If the haircut rises to 6 per cent, at least half the assets will have to be sold.
“Another sign of trouble is a ‘repo fail'. A ‘repo fail' occurs when one side of the agreement fails to abide by the contract. [Fail to deliver the security under the repurchase agreement.]
“Dealer banks would not accept collateral because they rightly believed that if they had to seize the collateral should the counter-party fail, then there would be no market in which to sell it. This was due to the absence of buyers because of the deleveraging. This led to an absence of prices for these securities. If the value cannot be determined because there is no market – no liquidity or there is the concern that if the asset is seized by the lender, it will not be saleable at all, then the dealer will not engage in repo. Repo dealers report that there was uncertainty about whether to believe the ratings on these structured products, and in a very fast moving environment, the response was to pull back from accepting anything structured. If no one would accept structured products for repo, then these bonds could not be traded – and then no one would want to accept them in repo transactions.”
This change led to a sharp increase in the demand for government securities for repo transactions, which was compounded by significantly higher safe-haven demand for US Treasuries and the increased unwillingness to lend such securities in repo transactions. As the crisis unfolded, this combination resulted in US government collateral becoming extremely scarce. [6]
I will now turn to the issue of the FED's solvency.
As has been observed, the Fed intervened aggressively to check the run on the repo market. Various measures were taken, but in my view the most dangerous was the widening of the collaterals which the Fed was willing to accept to secure funding of the players in the repo market. The Fed also intervened by lending a huge chunk of its US treasuries in exchange for junks to facilitate credit expansion. In the result, what happened was that the Fed's present balance sheet of approximately $2 trillion is made up mostly of junk securities.
The Fed is no different from banks in that confidence in the quality of its assets is critical and that if and when the market recovers, there is in fact a market for the junk assets that it took on to unravel the gridlock in the financial markets.
By way of analogy, if your high street bank's balance sheet is made up of junk, what would you do? There are just not enough assets to meet its liabilities. But of course, one can argue that the Fed is not your high street bank. It is the central bank of the mighty USA . It will always be able to “print money” or “digitalise” money and keep the markets going.
But beware that the Federal Reserve Note is mere paper, fiat money which cannot be redeemed for anything tangible such as gold. And although it is stated boldly in the notes issued - “In God we trust” - you and I are not actually placing our trust in God when accepting the Federal Reserve Notes as “money”.
When Joe Six-Packs realises that the Federal Reserve Note is not even secured by US treasuries nor the FED has real tangible assets, but its balance sheet is littered with junks and toxic waste, there will be a run on the Fed i.e. when Americans and foreigners no longer have faith in the Federal Reserve Notes as “money”.
If confidence could vaporise in a second and cause a stampede in what was once considered solid security, the triple A rated bonds in the repo and money markets, the same confidence that is now reposed in the Federal Reserve Notes can likewise disappear into the memory hole.
All these years, the con was maintained by the Fed that it was solid because it has on its balance sheet over $800 billion of US treasuries i.e. its notes “were so-called backed by these treasuries”. It could sell its treasuries in the repo market for cash and thereby control the money flows in the economy and vice versa.
In their subconscious mind, Americans and stupid foreign central banks and their executives (brain-washed by the Chicago School of Economics) somehow believe in the infallibility of the Fed. Now it has been exposed that the Fed's “assets” comprise of junk bonds and toxic wastes. The Emperor has no clothes! Paul Volcker, former Chairman of the Federal Reserve may have given the ultimate epitaph: “The bright new financial system – for all its talented participants, for all its rich rewards – has failed the test of the market place.”
And it is any wonder that Professor Nouriel Roubini declared:
“The process of socialising the private losses from this crisis has already moved many liabilities of the private sector onto the books of the sovereign. At some point a sovereign bank may crack, in which case the ability of the government to credibly commit to act as a backstop for the financial system – including deposit guarantees – could come unglued.”
In my opinion, the Fed has already become “unglued”. Whatever guarantees given to secure the indebtedness of CitiGroup and others to prevent a run on these banks are useless. It is bankrupt!
End Notes
[1] There are two banking systems in existence today. The Traditional Banking System – i.e. High Street banks and the Shadow Banking System. But the players in both the systems overlap because, the major banks of the traditional system helped spawn the shadow banking system. In fact they are the key players in the use of the so-called “new financial products, the CDOs, CLOs, MBS” etc and which have now turned toxic – worthless, junk to be exact.
[2] See my website archives: Roubini Warns of Sovereign Bank Failure – February 20, 2009 www.theage.com. au
[3] See: Implications of repo markets for central banks, CGFS Publications No 10, March 1999.
[4] Gary Gorton, Information, Liquidity, and the (Ongoing) Panic of 2007 prepared for the Jackson Hole Conference 2008
[5] “haircut” here refers to the rate payable for the cash loan or the margin.
[6] Peter Hordahl and Martin R King, Developments in repo markets during the financial turmoil BIS Quarterly Review, December 2008
Matthias Chang is a prominent barrister, author and analyst of the New World Order based in Malaysia . © Copyright Matthias Chang, Future Fast Forward, 2009
Courtesy Global Research [www.globalresearch. ca/index. php?context= va&aid=12648]
Matthias Chang
20 March 2009
The Federal Reserve is bankrupt for all intents and purposes. The same goes for the Bank of England ! This article will focus largely on the Fed, because the Fed is the “financial land-mine”. How long can someone who has stepped on a landmine, remain standing – hours, days? Eventually, when he is exhausted and his legs give way, the mine will just explode! The shadow banking system has not only stepped on the land-mine, it is carrying such a heavy load (trillions of toxic wastes) that sooner or later it will tilt, give way and trigger off the land-mine![1]
In a recent article, I referred to the remarks of British Prime Minister Gordon Brown and President Obama calling for the shadow banking system to be outlawed. Even if the call was genuine, it is too late. The land-mine has been triggered and the explosion cannot be averted under any circumstances. The only issue is the extent of the damage to the global economy and how long it will take for the world to recover from this fiasco – a financial madness that has no precedent. The great depression is “Mary Poppins” in comparison!
The idea of a central bank going bankrupt is not that outlandish. I am by no means the first author who has given this stark warning. What underlies this crisis (which I initially examined in an article in December 2006) is the potential collapse of the global banking system, specifically the Shadow Money-Lenders.
Nouriel Roubini, the New York University professor said [2]:
“The process of socialising the private losses from this crisis has moved many of the liabilities of the private sector onto the books of the sovereign. At some point a sovereign bank may crack, in which case, the ability of the government to credibly commit to act as a backstop for the financial system – including deposit guarantees – could come unglued.”
Please read the underlined words again. “Sovereign bank” means central bank. When a central bank “cracks” i.e. becomes insolvent, “all hell breaks lose”, because as the professor correctly pointed out, “any government guarantees will ring hollow and will be useless”. If a central bank goes belly up, it is as good as the government going bankrupt. Period!
In another article, Roubini admitted that the pressure on “the financial land-mine” is totally unbearable. He wrote: “The US Financial system is effectively insolvent”. It follows that if the financial system is bankrupt, it is a matter of time before the “sovereign bank” goes belly up. This is a given!
He stated further that:
“Thus, the U.S. financial system is de facto nationalized, as the Federal Reserve has become the lender of first and only resort rather than the lender of last resort, and the U.S. Treasury is the spender and guarantor of first and only resort. The only issue is whether banks and financial institutions should also be nationalized de jure.
“AIG which lost $62 billion in the fourth quarter and $99 billion in all of 2008 is already 80% government-owned. With such staggering losses, it should be formally 100% government-owned. And now the Fed and Treasury commitments of public resources to the bailout of the shareholders and creditors of AIG have gone from $80 billion to $162 billion.
“Given that common shareholders of AIG are already effectively wiped out (the stock has become a penny stock), the bailout of AIG is a bailout of the creditors of AIG that would now be insolvent without such a bailout. AIG sold over $500 billion of toxic credit default swap protection, and the counter-parties of this toxic insurance are major U.S. broker-dealers and banks.
“News and banks analysts' reports suggested that Goldman Sachs got about $25 billion of the government bailout of AIG and that Merrill Lynch was the second largest benefactor of the government largesse. These are educated guesses, as the government is hiding the counter-party benefactors of the AIG bailout. (Maybe Bloomberg should sue the Fed and Treasury again to have them disclose this information. )
“But some things are known: Goldman's Lloyd Blankfein was the only CEO of a Wall Street firm who was present at the New York Fed meeting when the AIG bailout was discussed. So let us not kid each other: The $162 billion bailout of AIG is a non-transparent, opaque and shady bailout of the AIG counter-parties: Goldman Sachs, Merrill Lynch and other domestic and foreign financial institutions.
“So for the Treasury to hide behind the “systemic risk” excuse to fork out another $30 billion to AIG is a polite way to say that without such a bailout (and another half-dozen government bailout programs such as TAF, TSLF, PDCF, TARP, TALF and a programme that allowed $170 billion of additional debt borrowing by banks and other broker-dealers, with a full government guarantee), Goldman Sachs and every other broker-dealer and major U.S. bank would already be fully insolvent today.
“And even with the $2 trillion of government support, most of these financial institutions are insolvent, as delinquency and charge-off rates are now rising at a rate - given the macro outlook - that means expected credit losses for U.S. financial firms will peak at $3.6 trillion. So, in simple words, the U.S. financial system is effectively insolvent.”
McClatchy newspaper reported (03/08/2009) bad news affecting the banks:
“America's five largest banks, which already have received $145 billion in taxpayer bailout dollars, still face potentially catastrophic losses from exotic investments if economic conditions substantially worsen, their latest financial reports show.
“Citibank, Bank of America, HSBC Bank USA, Wells Fargo Bank and J.P. Morgan Chase reported that their “current” net loss risks from derivatives — insurance-like bets tied to a loan or other underlying asset — surged to $587 billion as of Dec. 31. Buried in end-of-the-year regulatory reports that McClatchy has reviewed, the figures reflect a jump of 49 percent in just 90 days.
“The disclosures underscore the challenges that the banks face as they struggle to navigate through a deepening recession in which all types of loan defaults are soaring.
“The government has since committed $182 billion to rescue AIG and, indirectly, investors on the other end of the firm's swap contracts. AIG posted a fourth quarter 2008 loss last week of more than $61 billion, the worst quarterly performance in U.S. corporate history.
“The five major banks, which account for more than 95 percent of U.S. banks' trading in this array of complex derivatives, declined to say how much of the AIG bailout money flowed to them to make good on these contracts.
“The banks' quarterly financial reports show that as of Dec. 31:
— J.P. Morgan had potential current derivatives losses of $241.2 billion, outstripping its $144 billion in reserves, and future exposure of $299 billion.
— Citibank had potential current losses of $140.3 billion, exceeding its $108 billion in reserves, and future losses of $161.2 billion.
— Bank of America reported $80.4 billion in current exposure, below its $122.4 billion reserve, but $218 billion in total exposure.
— HSBC Bank USA had current potential losses of $62 billion, more than triple its reserves, and potential total exposure of $95 billion.
— San Francisco-based Wells Fargo, which agreed to take over Charlotte-based Wachovia in October, reported current potential losses totalling nearly $64 billion, below the banks' combined reserves of $104 billion, but total future risks of about $109 billion.
“Kopff, the bank shareholders' expert, said that several of the big banks' risks are so large that they are “dead men walking.”
Berkshire Hathaway Chairman, Warren Buffett is so livid by the sheer magnitude of the financial mess that he said:
“These instruments [derivatives] have made it almost impossible for investors to understand and analyze our largest commercial banks and investment banks . . . When I read the pages of 'disclosure' in (annual reports) of companies that are entangled with these instruments, all I end up knowing is that I don't know what is going on in their portfolios. And then I reach for some aspirin.”
The above bad news refers to the losses and potential losses that the big banks have suffered and will suffer in the near future. But what is overlooked by many financial analysts is that these very same derivative products have caused another financial organ failure. And there is no way that the said organ can be resuscitated to its former state of health.
The Repo Market is gridlocked!
There has been an incestuous relationship between the traditional banking system and the shadow banking system and the link that joined the two together is the Repo Market [Repurchase Market]. This is in fact the weakest link in the entire financial system.
This is a very technical subject and I seek your indulgence and patience when reading the remaining part of this article. The gridlock of the repo market is the basis for my assertion that over and above the aforesaid dire financial facts, it is the major contributing factor to the bankruptcy of the Federal Reserve!
I want to use a simple analogy. This will make the issue easier to understand. Picture a one-inch diameter thick rope. Such a rope is made up of a few strands of narrower ropes, say 1/10th inch which are twined together to make the thick one-inch diameter rope. Picture again that all the outer strands have been burnt away, and what remains is the middle strand, still lifting the weight. But this strand cannot on its own lift such a weight, and sooner or later it will snap. When that happens, the weight will come crashing down! The middle strand is the repo market.
Alternatively, you can use the analogy that the repo market is the heart that pumps the blood (the cash flow). The financial system is the body and it has suffered a massive heart attack! What is the repo market? The repo market is the market whereby all financial institutions (regulated and unregulated) invariably go to obtain financing to meet reserve requirements, bridging finance, to lend or purchase securities, to hedge and or to invest on short-term basis.
It used to be that mainly US Treasuries (bear this in mind at all times) were used as security for Repo transactions, as it is considered as most secure i.e. as good as cash since it is backed by the credit of the US government! This requirement is no longer the case. More of this issue later.
The Nature of Repo Transactions
In repo transactions, securities are exchanged for cash with an agreement to repurchase the securities at a future date. The securities serve as collateral for what is effectively a cash loan. A distinguishing feature of repos is that they can be used either to obtain funds or to obtain securities. As repos are short-maturity collateralized instruments, repo markets have strong linkages with securities markets, derivative markets and other short term markets such as inter-bank and money markets. [3]
Like other financial markets, repo markets are subject to credit risks, operational risks and liquidity risks. However, what distinguishes the credit risks on repos from that associated with uncollateralized instruments is that repos credit exposures arise from volatility (or market risk) in the value of collateral. Bear this in mind at all times.
Repos allow institutions to use leverage to take larger positions in financial markets which could add to systemic risks. Bear this in mind at all times.
And because of the close linkages between repo markets and securities markets, any shocks will be transmitted quickly, resulting in a gridlock. Bear this in mind at all times.
Transactions covered by definition of repos are as follows:
(A) Repurchase Agreement
A repurchase agreement involves the sale of an asset under an agreement to repurchase the asset from the same counter-party. Interest is paid on the repurchase agreement by adjusting the sale and purchase price. A reverse repo is the purchase of an asset with an agreement to re-sell the same or a similar asset.
A hold-in-custody repurchase agreement is a trade whereby the repoer (the borrower of cash) continues to hold the collateralizing securities in custody for the lender of cash. The risks are obvious!
A deliver-out repurchase agreement is where securities are delivered to the cash lender for custody in exchange for cash.
A tri-party repurchase agreement is similar to a deliver-out repurchase agreement, except that the security is placed in the custody of a third-party entity. The third-party ensures that the security meets the cash lender's requirements and provides valuation and margining services. This is the primary form of repurchase agreement for securities dealers in the United States . Bank of New York and JP Morgan Chase are the two main custodians or clearing banks in the US and supervise the vast majority of the tri-party repos. Bear this in mind at all times.
(B) Sell/Buy-Back Agreement
A sell buy-back is two distinct outright cash market trades, one for forward settlement. The forward price is set relative to the spot price to yield a market rate of return.
(C) Securities Lending
This is where the owner of the security lends them to another person in return for a fee. The borrower of the security is contractually obliged to redeliver a like quantity of the same securities, or return precisely the same securities.
Repos can be of any duration but are most commonly over-night loans. Repos longer than over-night are called Term Repos. There are also Open Repos which are transactions which can be terminated by both parties on a day's notice.
The largest players of repos and reverses are the dealers in government securities. There are about 20 primary dealers recognised by the Fed which are authorised to bid for new-issued treasury securities for resale in the market. The dealers are highly leveraged, 50 to 100 times their own capital. To finance the purchase of treasury securities, the dealers need to have repo monies in large amounts on a continuing basis. The institutions that supply such huge funds in the repo market are money funds, large corporations, state and local governments and foreign central banks.
The Repo Market and the Financial Crisis
As stated earlier when the repo market first started, US treasuries were the preferred security. But when financial engineering exploded and many financial products (i.e. CDOs) were rated AAA by rating agencies, these securities were also traded as described above in the repo market. This was when problems started.
According to Gary Gorton [4], the repo market before the crisis was estimated to be worth a whopping $12 trillion as compared to the total assets in the entire US banking system of $10 trillion.
The former CEO of Federal Reserve Bank of New York (NYFRB) and now the US Treasury Secretary, Tim Geithner observed in 2008:
“The structure of the financial system changed fundamentally during the boom, with dramatic growth in the share of assets outside the traditional banking system. This non-bank financial system grew to be very large, particularly in money and funding markets.
“This parallel system financed some of these very assets on a very short term basis in the bilateral or tri-party repo markets. As the volume of activity in repo markets grew, the variety of assets financed in this manner expanded beyond the most highly liquid securities to include less liquid securities, as well. Nonetheless, these assets were assumed to be readily sellable at fair values, in part because assets with similar credit ratings had generally been tradable during past periods of financial stress. And the liquidity supporting them was assumed to be continuous and essentially frictionless, because it had been so for a long time.
“The scale of long term risky and relatively illiquid assets financed by very short-term liabilities made many of the vehicles and institutions in this parallel financial system vulnerable to a classic type run, but without the protection such as deposit insurance that the banking system has in place to reduce such risks.”
Economic historians will argue for another century as to the cause for the run on the repo market. The collapse of Bear Stearns is as good a starting point as any. When the market discovered that its securities were duds, pure junk, shock waves ripped through the system. Recall that I had mentioned earlier that Federal Bank of New York and JP Morgan Chase were the primary clearing banks for repos.
The Fed's rescue of Bear Stearns through JP Morgan was not so much to save the former but rather to shore up the “clearing system” of the repos for which JP Morgan Chase and the Bank of New York were the main pillars. One of the functions of a “clearing bank” for repos is to value and match securities tendered for cash borrowings. If Bear Stearns securities are now valued as junks, the integrity of JP Morgan and Federal Bank of New York as clearing banks in this market is as good as zero! And bearing in mind that the five major investment banks in the US rely heavily on the repo market for their funding, any gridlock in this part of the shadow banking system would tear wide open the entire banking system, including the traditional counter-part.
Hence, the FED intervention by the creation of the Primary Dealer Credit Facility (PDCF), which was in effect the backstop for all investment banking using tri-party repos! This was what Bernanke said:
“We have been working with market participants to develop a contingency plan should there ever occur a loss of confidence in either of the two clearing banks that facilitate the settlement of tri-party repos.”
Louis Crandall, economist at Wrightson ICAP observed:
“The vulnerability of the tri-party repo system has been a recurring theme among Federal Reserve and Treasury officials in recent weeks.”
The inherent weakness of tri-party repos is that the counter-party risks of billions worth of funding agreements are shouldered by essentially two players – Federal Bank of New York and JP Morgan Chase. Yet, way back then, they were held up as rock solid. It is almost hilarious to read the then advert of the Federal Bank of New York as to their expertise and service:
“Sophisticated collateral selection: enforce diversification and credit quality; control adequacy, volatility & liquidity.
“Cutting edge infrastructure: economies of scale facilitate extensive data warehousing, access to more asset classes and markets, auto-substitution, auto-allocation & optimisation technology, same day reporting.
“Introduction to new counterparts: A Global Collateral Clearing House.”
Panic swept across the entire repo market. No securities were considered safe enough for repos except US treasuries. Fundings in the repo market grind to a halt. Market players withdrew funds and began hoarding treasuries. The rest who own structured products were slaughtered.
I would like to quote Gary Gorton again:
“Imagine a firm that is levered 30:1, by borrowing in the repo market. If the haircut [5] doubles, or goes from zero to a positive amount, the required deleveraging is massive! Most investment banks were levered 30:1, equivalent to about a 3 per cent haircut. If the haircut rises to 6 per cent, at least half the assets will have to be sold.
“Another sign of trouble is a ‘repo fail'. A ‘repo fail' occurs when one side of the agreement fails to abide by the contract. [Fail to deliver the security under the repurchase agreement.]
“Dealer banks would not accept collateral because they rightly believed that if they had to seize the collateral should the counter-party fail, then there would be no market in which to sell it. This was due to the absence of buyers because of the deleveraging. This led to an absence of prices for these securities. If the value cannot be determined because there is no market – no liquidity or there is the concern that if the asset is seized by the lender, it will not be saleable at all, then the dealer will not engage in repo. Repo dealers report that there was uncertainty about whether to believe the ratings on these structured products, and in a very fast moving environment, the response was to pull back from accepting anything structured. If no one would accept structured products for repo, then these bonds could not be traded – and then no one would want to accept them in repo transactions.”
This change led to a sharp increase in the demand for government securities for repo transactions, which was compounded by significantly higher safe-haven demand for US Treasuries and the increased unwillingness to lend such securities in repo transactions. As the crisis unfolded, this combination resulted in US government collateral becoming extremely scarce. [6]
I will now turn to the issue of the FED's solvency.
As has been observed, the Fed intervened aggressively to check the run on the repo market. Various measures were taken, but in my view the most dangerous was the widening of the collaterals which the Fed was willing to accept to secure funding of the players in the repo market. The Fed also intervened by lending a huge chunk of its US treasuries in exchange for junks to facilitate credit expansion. In the result, what happened was that the Fed's present balance sheet of approximately $2 trillion is made up mostly of junk securities.
The Fed is no different from banks in that confidence in the quality of its assets is critical and that if and when the market recovers, there is in fact a market for the junk assets that it took on to unravel the gridlock in the financial markets.
By way of analogy, if your high street bank's balance sheet is made up of junk, what would you do? There are just not enough assets to meet its liabilities. But of course, one can argue that the Fed is not your high street bank. It is the central bank of the mighty USA . It will always be able to “print money” or “digitalise” money and keep the markets going.
But beware that the Federal Reserve Note is mere paper, fiat money which cannot be redeemed for anything tangible such as gold. And although it is stated boldly in the notes issued - “In God we trust” - you and I are not actually placing our trust in God when accepting the Federal Reserve Notes as “money”.
When Joe Six-Packs realises that the Federal Reserve Note is not even secured by US treasuries nor the FED has real tangible assets, but its balance sheet is littered with junks and toxic waste, there will be a run on the Fed i.e. when Americans and foreigners no longer have faith in the Federal Reserve Notes as “money”.
If confidence could vaporise in a second and cause a stampede in what was once considered solid security, the triple A rated bonds in the repo and money markets, the same confidence that is now reposed in the Federal Reserve Notes can likewise disappear into the memory hole.
All these years, the con was maintained by the Fed that it was solid because it has on its balance sheet over $800 billion of US treasuries i.e. its notes “were so-called backed by these treasuries”. It could sell its treasuries in the repo market for cash and thereby control the money flows in the economy and vice versa.
In their subconscious mind, Americans and stupid foreign central banks and their executives (brain-washed by the Chicago School of Economics) somehow believe in the infallibility of the Fed. Now it has been exposed that the Fed's “assets” comprise of junk bonds and toxic wastes. The Emperor has no clothes! Paul Volcker, former Chairman of the Federal Reserve may have given the ultimate epitaph: “The bright new financial system – for all its talented participants, for all its rich rewards – has failed the test of the market place.”
And it is any wonder that Professor Nouriel Roubini declared:
“The process of socialising the private losses from this crisis has already moved many liabilities of the private sector onto the books of the sovereign. At some point a sovereign bank may crack, in which case the ability of the government to credibly commit to act as a backstop for the financial system – including deposit guarantees – could come unglued.”
In my opinion, the Fed has already become “unglued”. Whatever guarantees given to secure the indebtedness of CitiGroup and others to prevent a run on these banks are useless. It is bankrupt!
End Notes
[1] There are two banking systems in existence today. The Traditional Banking System – i.e. High Street banks and the Shadow Banking System. But the players in both the systems overlap because, the major banks of the traditional system helped spawn the shadow banking system. In fact they are the key players in the use of the so-called “new financial products, the CDOs, CLOs, MBS” etc and which have now turned toxic – worthless, junk to be exact.
[2] See my website archives: Roubini Warns of Sovereign Bank Failure – February 20, 2009 www.theage.com. au
[3] See: Implications of repo markets for central banks, CGFS Publications No 10, March 1999.
[4] Gary Gorton, Information, Liquidity, and the (Ongoing) Panic of 2007 prepared for the Jackson Hole Conference 2008
[5] “haircut” here refers to the rate payable for the cash loan or the margin.
[6] Peter Hordahl and Martin R King, Developments in repo markets during the financial turmoil BIS Quarterly Review, December 2008
Matthias Chang is a prominent barrister, author and analyst of the New World Order based in Malaysia . © Copyright Matthias Chang, Future Fast Forward, 2009
Courtesy Global Research [www.globalresearch. ca/index. php?context= va&aid=12648]
Royal's fight for justice : Khan Suleman Daud
http://news.bbc.co.uk/2/hi/uk_news/wales/7952159.stm
Royal asylum seeker Khan Suleman Daud - the 35th Khan of Kalat - explains why he has left his family and people in Pakistan to live in Cardiff.
New Treasury Salvo Against Iran’s Melli Bank
Source: IntelligenceOnline.com
19/03/2009 Washington/Tehran
New Treasury Salvo Against Iran’s Melli Bank
Fresh American sanctions against Iran’s state-owned Melli Bank are aimed primarily at wrecking Tehran’s efforts to drum up foreign investment.
A year ago Intelligence Online reported that the U.S. Treasury Department was thinking opening hostilities against Melli Investment Holding International (MEHR), the fund management affiliate of Melli, the biggest public bank in Iran. That has now happened. Washington has just announced sanctions against 11 companies with links to Melli (see graph below).Backed by the European Commission and the U.N. Security Council, Washington had already fired broadsides at all of Melli’s branches overseas (London, Paris, Hong Kong and Moscow, etc.). The Treasury Department’s new offensive primarily targets the web of firms set up by the bank in the United Arab Emirates and the Cayman Islands tax haven. The latter offshore branch is headed by Britain’s Stephen Austen assisted by three Iranians: Faziollah Moazzami, boss of BMIIC, the investment arm of Melli; Mohammed Mehrzad, former chief of BMIIC and now a director of MEHR; and Esfandiar Rashidzadeh, who headed the first MBIIC affiliate that opened in Dubai in 2004, BMIIC International General Trading. Austen is no stranger to Iran. In 1983, after the Islamic revolution, he re-opened a branch of Lloyds Bank in Tehran. More recently, after stints with France’s Calyon and Goldman Sachs, he co-founded and headed the Future Bank, a joint venture between the Bahrain-based bank Ahli United Bank, and the state-owned Iranian establishments Saderat and Melli. Future Bank, also hit by Treasury Department sanctions in October 2007, still operates.
CHINESE ECONOMIC BLUES
B.RAMAN
The second session of the Second Plenary of the 11th National People's Congress (NPC) of China , which is its Parliament, was held at Beijing from March 3 to 12,2009. There were detailed discussions in the NPC on the state of the nation as reported by Prime Minister Wen Jiabo and other Ministers. President Hu Jintao, Wen and other important members of the Government and the Chinese Communist Party also availed of the presence in Bejing for the NPC session of Government and party representatives from different provinces to discuss with the representatives from each province in the margins of the NPC session the state of the economy in each province. They explained to the representatives from the provinces the measures already taken by the Government to deal with the decrease in exports, the closing down of many factories and the consequent increase in unemployment and gave guidance as to how the provinces should deal with the situation.
2. A study of the proceedings of the NPC session and of the discussions in the various interactions held by Hu, Wen and others in the margins of the NPC session indicate that the just-concluded session was largely taken up by issues relating to the economy and internal security. This was indicative of the concern of the Chinese leadership over the likely impact of the economic decline on the internal security situation due to the increase in unemployment and fall in the prices of agricultural accommodities due to a decrease in the purchasing power of the people.
3. On a rough estimate, a little more than 50 per cent of the discussions was devoted to the state of the economy and about 20 per cent to the internal security situation, including the situation in Tibet. Only the remaining 30 per cent of the discussions was devoted to other issues. The work of the Ministry of Public Security, which is responsible for internal security, received much greater attention than the work of other Ministries.
4. It must be said to the credit of the Chinese leaders that they were quite transparent during the discussions in the NPC session as well as in the margins of the NPC session. They frankly admitted the difficulties faced by the economy,without any attempt to cover them up. At the same time, it was pointed out that the difficulties arose due to the US mismanagement of its financial sector, which has affected and continues to affect all global economies for no fault of their leaders. It was explained that the difficuilties faced by China were not due to any mismanagement by its policy-makers. It was also highlighted that the Chinese banks and other financial institutions are in a good state of health and that China's problems are radiating from the manufacturing sector, which had become over-dependent on the external market---particularly the US market.
5. While there is an understanding of the need for developing the domestioc market, which was neglected till now, the Chinese policy-makers do not seem to realise that this is difficult in a time of declining purchasing power of the Chinese families and the consequent decline in demand. The decline in the purchasing power of the Chinese families is due to about 20 million Chinese, who were gainfully employed till November last, losing their jobs and another 7.1 million new entrants to the job market finding it difficult to get a job. The Chinese policy-makers are hoping to create nine million new jobs during 2009 under their stimulus package (US $ 585 billion) announced in November last. Even if they succeed in doing so, there will still be about 18 million unemployed left.
6. To transform the vast rural China into a consumer market, producers of automobiles, domestic appliances etc are being encouraged to take their accumulated stocks to the countryside and sell them to the rural people. But when people have less and less money to buy even their essential requirements, there are very few takers for such goods in the countryside.
7. The Chinese are juggling with two mutually contradictory objectives. Firstly, how to restructure their manufacturing sector in order to enable it to look more inwards than in the past? Secondly, how to retain China's present share of the global trade, which has enabled it over the years to earn the money for its military expanasion and modernisaion? For the retention of China's newly-acquired status as a global power, it is important for it not to lose its share of the global trade. They have not come out with a satisfactory policy, which could meet both these objectives.
8. There are two possible sources of social tensions which could have an impact on the internal security situation. The likelihood of tensions arising from the serious unemployment situation has already been noted by experts in China as well as outside. The other likelihood of tensions in the rural areas due to the income of the rural families being hit by the fall in commodity prices has not received the required attention. There has been a lot of focus on the likelihood of urban tensions, but not enough focus on likely rural tensions. A study of Chinese history would show that successful mass uprisings started from the rural areas.
9. The other question left undiscussed is how the decline in the flow of inputs such as fertilisers to farming would affect China's agricultural production in the short and medium terms. Job security has already become a grave issue. Can food security emerge as an equally worrisome issue?
10. The Chinese are gratified by the US request as conveyed by Mrs.Hillary Clinton, the US Secretary of State, during her visit to Beijing from February 20 to 22,2009 that they should continue to invest their foreign exchange reserves in US Treasury Bonds. At the same time, they have made it clear that their decision in this matter will be decided by their national requirements. If the stimulus package announced last November does not halt their economic decline, they may have to initiate another stimulus package. To fund it, they may have to dip into their foreign exchange reserves.This is not the time to divert more reserves to the US bond market. They have been making this point repeatedly even in the past weeks before Hillary Clinton's visit.
11. Briefing the media on the NPC session on March 13,2009, Prime Minister Wen indicated another reason for the Chinese caution on the issue of investing more in the US bonds---- namely, their misgivings about the continued stability of the US dollar. Wen said: " "We lent such huge fund to the United States and of course we're concerned about the security of our assets and, to speak truthfully, I am a little bit worried. On the foreign reserves issue, the first consideration is the national interest. But we also have to consider the stability of the overall international financial system, as the two factors are interlinked. China is indeed the largest creditor of the United States, which is the world's biggest economy. We are extremely interested in developments in the U.S. economy. We are watching the effect of the measures taken by the U.S. Government to counter the international financial crisis."
12. US policy-makers have hastened to reassure Beijing about the stability of the US dollar. In a speech at the Brookings Institution in Washington DC on March 13,2009, immediately after Wen's press conference in Beijing, Larence Summers, Obama's top economic advisor in his capacity as the Director of the National Economic Council (NEC), said: "The U.S. would be sound stewards of the money we invest.
This is a commitment that the President has made very clear --we need to be sound stewards of the money we invest."
13. Are the Chinese leaders satisfied by this assurance? One has to wait and see. They would prefer to watch for the impact of Obama's policies on the US banking sector before taking any decision on an increase in investments in the US bonds. In November last, the total value of the Chinese holdings of the US Bonds was estimated at US $ 681.9 billion.
14. While studying the remarks of the Chinese leaders during the NPC session, one could detect an under-current of concern that the conservative anti-reform elements in the party and the Government might try to exploit the current difficulties by blaming them not on the US mismanagement of its banking sector, but on the Chinese policy of economic reforms and globalisation itself. It was repeatedly stressed that there would be no going back on the reforms and that China should continue to adhere to its policy of opening up its economy. (20-3-09)
(The writer is Additional Secretary(retd), Cabinet Secretariat, Govt. of India, New Delhi, and, presently, Director, Institute For Topical Studies, Chennai. He is also associated with the Chennai Centre For China Studies, E-mail: seventyone2@gmail.com )
The second session of the Second Plenary of the 11th National People's Congress (NPC) of China , which is its Parliament, was held at Beijing from March 3 to 12,2009. There were detailed discussions in the NPC on the state of the nation as reported by Prime Minister Wen Jiabo and other Ministers. President Hu Jintao, Wen and other important members of the Government and the Chinese Communist Party also availed of the presence in Bejing for the NPC session of Government and party representatives from different provinces to discuss with the representatives from each province in the margins of the NPC session the state of the economy in each province. They explained to the representatives from the provinces the measures already taken by the Government to deal with the decrease in exports, the closing down of many factories and the consequent increase in unemployment and gave guidance as to how the provinces should deal with the situation.
2. A study of the proceedings of the NPC session and of the discussions in the various interactions held by Hu, Wen and others in the margins of the NPC session indicate that the just-concluded session was largely taken up by issues relating to the economy and internal security. This was indicative of the concern of the Chinese leadership over the likely impact of the economic decline on the internal security situation due to the increase in unemployment and fall in the prices of agricultural accommodities due to a decrease in the purchasing power of the people.
3. On a rough estimate, a little more than 50 per cent of the discussions was devoted to the state of the economy and about 20 per cent to the internal security situation, including the situation in Tibet. Only the remaining 30 per cent of the discussions was devoted to other issues. The work of the Ministry of Public Security, which is responsible for internal security, received much greater attention than the work of other Ministries.
4. It must be said to the credit of the Chinese leaders that they were quite transparent during the discussions in the NPC session as well as in the margins of the NPC session. They frankly admitted the difficulties faced by the economy,without any attempt to cover them up. At the same time, it was pointed out that the difficulties arose due to the US mismanagement of its financial sector, which has affected and continues to affect all global economies for no fault of their leaders. It was explained that the difficuilties faced by China were not due to any mismanagement by its policy-makers. It was also highlighted that the Chinese banks and other financial institutions are in a good state of health and that China's problems are radiating from the manufacturing sector, which had become over-dependent on the external market---particularly the US market.
5. While there is an understanding of the need for developing the domestioc market, which was neglected till now, the Chinese policy-makers do not seem to realise that this is difficult in a time of declining purchasing power of the Chinese families and the consequent decline in demand. The decline in the purchasing power of the Chinese families is due to about 20 million Chinese, who were gainfully employed till November last, losing their jobs and another 7.1 million new entrants to the job market finding it difficult to get a job. The Chinese policy-makers are hoping to create nine million new jobs during 2009 under their stimulus package (US $ 585 billion) announced in November last. Even if they succeed in doing so, there will still be about 18 million unemployed left.
6. To transform the vast rural China into a consumer market, producers of automobiles, domestic appliances etc are being encouraged to take their accumulated stocks to the countryside and sell them to the rural people. But when people have less and less money to buy even their essential requirements, there are very few takers for such goods in the countryside.
7. The Chinese are juggling with two mutually contradictory objectives. Firstly, how to restructure their manufacturing sector in order to enable it to look more inwards than in the past? Secondly, how to retain China's present share of the global trade, which has enabled it over the years to earn the money for its military expanasion and modernisaion? For the retention of China's newly-acquired status as a global power, it is important for it not to lose its share of the global trade. They have not come out with a satisfactory policy, which could meet both these objectives.
8. There are two possible sources of social tensions which could have an impact on the internal security situation. The likelihood of tensions arising from the serious unemployment situation has already been noted by experts in China as well as outside. The other likelihood of tensions in the rural areas due to the income of the rural families being hit by the fall in commodity prices has not received the required attention. There has been a lot of focus on the likelihood of urban tensions, but not enough focus on likely rural tensions. A study of Chinese history would show that successful mass uprisings started from the rural areas.
9. The other question left undiscussed is how the decline in the flow of inputs such as fertilisers to farming would affect China's agricultural production in the short and medium terms. Job security has already become a grave issue. Can food security emerge as an equally worrisome issue?
10. The Chinese are gratified by the US request as conveyed by Mrs.Hillary Clinton, the US Secretary of State, during her visit to Beijing from February 20 to 22,2009 that they should continue to invest their foreign exchange reserves in US Treasury Bonds. At the same time, they have made it clear that their decision in this matter will be decided by their national requirements. If the stimulus package announced last November does not halt their economic decline, they may have to initiate another stimulus package. To fund it, they may have to dip into their foreign exchange reserves.This is not the time to divert more reserves to the US bond market. They have been making this point repeatedly even in the past weeks before Hillary Clinton's visit.
11. Briefing the media on the NPC session on March 13,2009, Prime Minister Wen indicated another reason for the Chinese caution on the issue of investing more in the US bonds---- namely, their misgivings about the continued stability of the US dollar. Wen said: " "We lent such huge fund to the United States and of course we're concerned about the security of our assets and, to speak truthfully, I am a little bit worried. On the foreign reserves issue, the first consideration is the national interest. But we also have to consider the stability of the overall international financial system, as the two factors are interlinked. China is indeed the largest creditor of the United States, which is the world's biggest economy. We are extremely interested in developments in the U.S. economy. We are watching the effect of the measures taken by the U.S. Government to counter the international financial crisis."
12. US policy-makers have hastened to reassure Beijing about the stability of the US dollar. In a speech at the Brookings Institution in Washington DC on March 13,2009, immediately after Wen's press conference in Beijing, Larence Summers, Obama's top economic advisor in his capacity as the Director of the National Economic Council (NEC), said: "The U.S. would be sound stewards of the money we invest.
This is a commitment that the President has made very clear --we need to be sound stewards of the money we invest."
13. Are the Chinese leaders satisfied by this assurance? One has to wait and see. They would prefer to watch for the impact of Obama's policies on the US banking sector before taking any decision on an increase in investments in the US bonds. In November last, the total value of the Chinese holdings of the US Bonds was estimated at US $ 681.9 billion.
14. While studying the remarks of the Chinese leaders during the NPC session, one could detect an under-current of concern that the conservative anti-reform elements in the party and the Government might try to exploit the current difficulties by blaming them not on the US mismanagement of its banking sector, but on the Chinese policy of economic reforms and globalisation itself. It was repeatedly stressed that there would be no going back on the reforms and that China should continue to adhere to its policy of opening up its economy. (20-3-09)
(The writer is Additional Secretary(retd), Cabinet Secretariat, Govt. of India, New Delhi, and, presently, Director, Institute For Topical Studies, Chennai. He is also associated with the Chennai Centre For China Studies, E-mail: seventyone2@gmail.com )
March 19, 2009
India to hold competition for Rupee symbol
COMPETITION FOR DESIGN
Government of India
Ministry of Finance,
Department of Economic Affairs
New Delhi
Dated, February ,2009
******
Major currencies of the world e.g. US Dollar, Pound Sterling, Yen and the
Euro have an Identification symbol. The Government of India also proposes to have
a symbol for the Indian rupee to be selected through public competition.
Accordingly, all Resident Indians (both Professional artists and Non-professionals)
are hereby invited to participate in a Competition for design of the ‘Symbol for
Indian Rupee’.
Submission of Entries:
Interested persons may send their entries, along with a bank draft of Rs.500/-
(Rupees five hundred only) in favour of the Pay & Accounts Officer, Department of
Economic Affairs, New Delhi, drawn on a scheduled commercial bank/nationalised
bank at New Delhi as registration fee, to the Under Secretary (Currency),
Department of Economic Affairs, North Block, New Delhi – 110 001 to reach him
latest by 1300 hours on 15th April 2009. Entries received after the stipulated time
shall not be entertained and returned unopened. The Department shall not be
responsible for delay by postal services, courier agencies etc. The entries can also be deposited personally at the Information & Facilitation Counter of the Department,
near gate No. 8, North Block, New Delhi.
The entries should be sent in a properly sealed envelope labelled “Entry for
Symbol for the Indian Rupee”. The entry should be accompanied by a brief
explanation of the Design and how it best symbolizes the Indian Rupee and also the
bio-data of the applicant with a passport size photograph affixed on the top right
hand corner.
Guidelines for preparing entries:
1. The symbol should be sent only on an A-4 size paper in black and white print.
2. A graphical construction of the symbol design in exact proportions in a bigger
size, along with final design, Theme synopsis and concept is required to be
submitted.
3. The symbol should represent the historical & cultural ethos of the country as
widely accepted across the country.
4. The size of the final design should not be smaller than 232 square cm (36 sq
inches). It is to be submitted along with minimum TEN different proportionally
smaller sizes up to 4 points font size of the text matter.
5. The symbol should be applicable to standard keyboard. The symbol has to be
in the Indian National Language Script or a visual representation.
6. The symbol should be original work of the participant and must not infringe
the Intellectual Property Rights of any third party.
7. A participant can send a maximum of two entries.
8. The entry could be an individual project or a team project.
9. The entries received without the requisite fee shall be out rightly rejected.
Other Conditions:
1. The entries sent once shall not be returned.
2. The final selected symbol shall become the intellectual property of the
Government of India and the designer shall not have any right over the same.
3. The responsibility to comply with the guidelines and other conditions fully lies
with the participant and the Government of India shall not be liable for any
dispute raised by a third party.
Selection Process:
a) All the entries received by the stipulated date and time and found in order,
shall be evaluated by a Jury of Examiners comprising seven members drawn
from Art Institutions of repute (such as Sir JJ Institute of Applied Art, National
Institute of Design, Lalit Kala Academy, Indira Gandhi Centre for Art &
Culture) – three members, Government of India – 2 members and Reserve
Bank of India – 2 members.
b) Five entries shall be shortlisted for final selection. The shortlisted Designers
would be required to make a presentation to the Jury and would be awarded
a prize of Rs.25,000/- each. The date, time and venue of the presentation
shall be communicated separately to the shortlisted designers.
c) The Designer of the finally selected design will get a prize of Rs.250, 000/-
and would be required to surrender copyright of the design to the
government of India.
(No.10/8/06- Cy.II)
(B S Rawat)
Deputy Secretary to the Government of India
COMPETITION FOR DESIGN
Government of India
Ministry of Finance,
Department of Economic Affairs
New Delhi
Dated, February ,2009
******
Major currencies of the world e.g. US Dollar, Pound Sterling, Yen and the
Euro have an Identification symbol. The Government of India also proposes to have
a symbol for the Indian rupee to be selected through public competition.
Accordingly, all Resident Indians (both Professional artists and Non-professionals)
are hereby invited to participate in a Competition for design of the ‘Symbol for
Indian Rupee’.
Submission of Entries:
Interested persons may send their entries, along with a bank draft of Rs.500/-
(Rupees five hundred only) in favour of the Pay & Accounts Officer, Department of
Economic Affairs, New Delhi, drawn on a scheduled commercial bank/nationalised
bank at New Delhi as registration fee, to the Under Secretary (Currency),
Department of Economic Affairs, North Block, New Delhi – 110 001 to reach him
latest by 1300 hours on 15th April 2009. Entries received after the stipulated time
shall not be entertained and returned unopened. The Department shall not be
responsible for delay by postal service s, courier agencies etc. The entries can also be deposited personally at the Information & Facilitation Counter of the Department, near gate No. 8, North Block, New Delhi.
The entries should be sent in a properly sealed envelope labelled “Entry for
Symbol for the Indian Rupee”. The entry should be accompanied by a brief
explanation of the Design and how it best symbolizes the Indian Rupee and also the
bio-data of the applicant with a passport size photograph affixed on the top right
hand corner.
The guidelines for preparing entries, other conditions and selection process are
available on the website of the Ministry of Finance http://finmin.nic.in
(No.10/8/06- Cy.II)
(B S Rawat)
Deputy Secretary to the Government of India
Government of India
Ministry of Finance,
Department of Economic Affairs
New Delhi
Dated, February ,2009
******
Major currencies of the world e.g. US Dollar, Pound Sterling, Yen and the
Euro have an Identification symbol. The Government of India also proposes to have
a symbol for the Indian rupee to be selected through public competition.
Accordingly, all Resident Indians (both Professional artists and Non-professionals)
are hereby invited to participate in a Competition for design of the ‘Symbol for
Indian Rupee’.
Submission of Entries:
Interested persons may send their entries, along with a bank draft of Rs.500/-
(Rupees five hundred only) in favour of the Pay & Accounts Officer, Department of
Economic Affairs, New Delhi, drawn on a scheduled commercial bank/nationalised
bank at New Delhi as registration fee, to the Under Secretary (Currency),
Department of Economic Affairs, North Block, New Delhi – 110 001 to reach him
latest by 1300 hours on 15th April 2009. Entries received after the stipulated time
shall not be entertained and returned unopened. The Department shall not be
responsible for delay by postal services, courier agencies etc. The entries can also be deposited personally at the Information & Facilitation Counter of the Department,
near gate No. 8, North Block, New Delhi.
The entries should be sent in a properly sealed envelope labelled “Entry for
Symbol for the Indian Rupee”. The entry should be accompanied by a brief
explanation of the Design and how it best symbolizes the Indian Rupee and also the
bio-data of the applicant with a passport size photograph affixed on the top right
hand corner.
Guidelines for preparing entries:
1. The symbol should be sent only on an A-4 size paper in black and white print.
2. A graphical construction of the symbol design in exact proportions in a bigger
size, along with final design, Theme synopsis and concept is required to be
submitted.
3. The symbol should represent the historical & cultural ethos of the country as
widely accepted across the country.
4. The size of the final design should not be smaller than 232 square cm (36 sq
inches). It is to be submitted along with minimum TEN different proportionally
smaller sizes up to 4 points font size of the text matter.
5. The symbol should be applicable to standard keyboard. The symbol has to be
in the Indian National Language Script or a visual representation.
6. The symbol should be original work of the participant and must not infringe
the Intellectual Property Rights of any third party.
7. A participant can send a maximum of two entries.
8. The entry could be an individual project or a team project.
9. The entries received without the requisite fee shall be out rightly rejected.
Other Conditions:
1. The entries sent once shall not be returned.
2. The final selected symbol shall become the intellectual property of the
Government of India and the designer shall not have any right over the same.
3. The responsibility to comply with the guidelines and other conditions fully lies
with the participant and the Government of India shall not be liable for any
dispute raised by a third party.
Selection Process:
a) All the entries received by the stipulated date and time and found in order,
shall be evaluated by a Jury of Examiners comprising seven members drawn
from Art Institutions of repute (such as Sir JJ Institute of Applied Art, National
Institute of Design, Lalit Kala Academy, Indira Gandhi Centre for Art &
Culture) – three members, Government of India – 2 members and Reserve
Bank of India – 2 members.
b) Five entries shall be shortlisted for final selection. The shortlisted Designers
would be required to make a presentation to the Jury and would be awarded
a prize of Rs.25,000/- each. The date, time and venue of the presentation
shall be communicated separately to the shortlisted designers.
c) The Designer of the finally selected design will get a prize of Rs.250, 000/-
and would be required to surrender copyright of the design to the
government of India.
(No.10/8/06- Cy.II)
(B S Rawat)
Deputy Secretary to the Government of India
COMPETITION FOR DESIGN
Government of India
Ministry of Finance,
Department of Economic Affairs
New Delhi
Dated, February ,2009
******
Major currencies of the world e.g. US Dollar, Pound Sterling, Yen and the
Euro have an Identification symbol. The Government of India also proposes to have
a symbol for the Indian rupee to be selected through public competition.
Accordingly, all Resident Indians (both Professional artists and Non-professionals)
are hereby invited to participate in a Competition for design of the ‘Symbol for
Indian Rupee’.
Submission of Entries:
Interested persons may send their entries, along with a bank draft of Rs.500/-
(Rupees five hundred only) in favour of the Pay & Accounts Officer, Department of
Economic Affairs, New Delhi, drawn on a scheduled commercial bank/nationalised
bank at New Delhi as registration fee, to the Under Secretary (Currency),
Department of Economic Affairs, North Block, New Delhi – 110 001 to reach him
latest by 1300 hours on 15th April 2009. Entries received after the stipulated time
shall not be entertained and returned unopened. The Department shall not be
responsible for delay by postal service s, courier agencies etc. The entries can also be deposited personally at the Information & Facilitation Counter of the Department, near gate No. 8, North Block, New Delhi.
The entries should be sent in a properly sealed envelope labelled “Entry for
Symbol for the Indian Rupee”. The entry should be accompanied by a brief
explanation of the Design and how it best symbolizes the Indian Rupee and also the
bio-data of the applicant with a passport size photograph affixed on the top right
hand corner.
The guidelines for preparing entries, other conditions and selection process are
available on the website of the Ministry of Finance http://finmin.nic.in
(No.10/8/06- Cy.II)
(B S Rawat)
Deputy Secretary to the Government of India
March 18, 2009
Firms could turn backs on blacklisted Switzerland
Companies in Switzerland with close ties to the United States and Europe are growing ever more concerned about how business could turn if the country is blacklisted.
The looming spectre of being shunned by the world's most powerful economies has already forced Switzerland to start lifting the veil on portions of its banking secrecy laws. But business leaders worry the real threat runs far deeper than outing accused tax cheats.
CONTEXT
Senator Carl Levin, a Michigan Democrat, created a bill in February 2007, the Stop Tax Haven Abuse Act, to restrict the use of offshore tax havens and shelters to avoid US taxes. Levin, says "tax havens are engaged in economic warfare against the United States" and reintroduced an 84-page version of the bill earlier this month. Among other things, if passed, it would give the US Treasury Department authority to impose tougher reporting requirements on US taxpayers with dealings in "offshore secrecy" jurisdictions. Switzerland could be considered one such area.
Not only would billions of francs worth of foreign deposits likely be diverted to accounts elsewhere, but American and international companies that have long viewed Switzerland as an ideal base for European operations may begin to look away.
"Multinational companies in Switzerland are like a whole zoo with many kinds of animals and each would be touched in a different way," Martin Naville, head of the Swiss-American Chamber of Commerce in Zurich, told swissinfo. "There are a lot more risks than opportunities with this."
For the moment, talk of blacklisting remains hypothetical. The Group of 20, or G20, is slated in the coming weeks to discuss placing countries like Switzerland on a list of uncooperative tax havens.
If that happens, foreign companies with subsidiaries here could be subject to onerous audits, additional withholding taxes and – perhaps most damaging of all – public criticism in their home countries for having ties to a state deemed a financial pariah.
"I think people are right to be worried," said Werner Schiesser, a board member at BDO, an international accounting firm with offices in Zurich that does billions of dollars worth of business in the US. "Doing business with a country on the blacklist would raise a lot of eyebrows."
« Would you (open offices in Switzerland) and risk a newspaper report about investing money in a blacklisted country or just not go? »
Martin Naville, Swiss-American Chamber of Commerce Swiss brand could suffer
Such blacklist talk is not new but the critical difference this time is that Switzerland has come under simultaneous pressure from its two major trading partners – the EU and the US, which estimates it loses out on at least $100 billion (SFr118 billion) a year in tax revenues hidden in so-called offshore havens.
Naville says that Switzerland is no such haven and does not deserve to be on the list, especially since it contributes readily to the global fight against money laundering and terrorist financing.
Yet the pressure from both sides of the Atlantic has been enough so far to squeeze Switzerland, Andorra, Austria and Liechtenstein into softening laws on bank client confidentiality. It's unclear whether relaxing those laws will be enough to keep countries off the list.
Although the G20 has no binding legal authority, placing Switzerland on a blacklist would still carry significant consequences for both companies here as well as those looking to relocate.
"Pragmatically, say you are in charge of evaluating sites and you bring a project to your board in America and say we want to relocate 100 people to Switzerland," Naville said. "Someone might say, isn't it on a black list? Would you do it and risk a newspaper report about investing money in a blacklisted country or just not go?"
Swiss exporters could also find their competitive edge grow dull. Blacklisting could overshadow the country's reputation for high quality construction and well-defined standards.
"With reputation alone, blacklisting would change this to an extent that one could feel," Schiesser said. "For financial institutions, there would be a lower inflow from day one."
Export companies at risk
For a huge company like BDO, which provides bookkeeping services in 110 countries and employs 900 people in Switzerland and 44,000 people worldwide, having Switzerland blacklisted could change their client base and the way they do audits.
But the company is far too large to pull out of Switzerland altogether and the benefits for staying are still clear.
"We won't lose the multi-language skills of the people, the open society, the open business and good transportation," Schiesser said. "But taxes are always an issue."
Smaller exporters with offices in Switzerland and the US could be affected the most, since they have little political clout and fewer resources to deal with increased scrutiny and paperwork.
Black Diamond Equipment is one of those companies, though it has no plans to leave. The climbing- and ski-gear manufacturer based in Salt Lake City, Utah, picked Basel for its European base.
"Business law here is the most similar to the US in terms of reporting systems and how you run a company," said CEO Christian Jäggi. "Switzerland was the perfect solution for us."
European revenues
Since 1997, sales from the European arm of Black Diamond have erupted to generate about one-third of all revenue, which is about $100 million, although Black Diamond Europe has just 25 employees compared with 425 at the US headquarters.
But the balance sheets could change were Switzerland to be blacklisted, since the company might have to set aside a higher percentage of its budget as a safeguard withholding tax for US authorities.
"It'd be quite the headache," Jäggi said.
Other issues could arise over patents and royalty payments. If an overseas parent company has a subsidiary based in Switzerland that holds a patent, the parent company might have to pay the subsidiary royalties without being able to deduct the costs.
Either way, options for finding a way out could be dwindling.
"We have we try to make the Swiss authorities act quicker than in the past," Schiesser said. "We have to be very careful to keep tax environment is still interesting for US firms to have headquarters in Switzerland."
swissinfo, Tim Neville
FRIENDS, RIGHT?
Switzerland and the United States have a long history of cooperating on trade. In late November 1850, shortly after modern-day Switzerland came into being, the US and Switzerland signed a series of agreements. The Swiss president told parliament that year that the US offers "a treaty of friendship whereby the two freest peoples on earth will treat each other reciprocally on a footing of equality".
Today, the US estimates it loses at least $100 billion a year in tax revenue as 83 of the 100 largest companies have their profits taxed in offshore havens. Foreign private investors hold upwards of SFr2 trillion in Swiss banks. Another trillion francs are held by institutional investors.
A recent report by the US government states that 72 of that country's 100 biggest publically traded firms – such as American Express, General Motors, and IBM – have offshoots in Switzerland. Treaties between the US and Switzerland work to eliminate double taxation on dividends, interest and royalties, which help make the country attractive for European operations.
--------------------------------------------------------------------------------
USA AND SWITZERLAND
Thanks to its infrastructure, central location and competitive tax structure, Switzerland has become a major hub for foreign companies in Europe. The Swiss-American Chamber of Commerce estimates that 10% of the total Swiss gross national product – more than SFr40 billion ($33.8 billion) – is generated directly or indirectly by foreign companies. These companies employ 210,000 workers.
The US is the largest foreign direct-investor in Switzerland, with $100 billion in direct investments. There are 645 US companies operating in Switzerland. They provide about 71,000 direct jobs and about 120,000 total jobs.
For Switzerland, the US is the second-largest export market behind Germany. The Swiss sell more goods to Americans than to the French or Italians. Switzerland currently has about $163 billion in direct investments in the US, making the tiny alpine nation the seventh largest foreign investor. There are 560 Swiss companies operating in the US. They provide 310,000 direct jobs and about 500,000 indirect jobs.
The looming spectre of being shunned by the world's most powerful economies has already forced Switzerland to start lifting the veil on portions of its banking secrecy laws. But business leaders worry the real threat runs far deeper than outing accused tax cheats.
CONTEXT
Senator Carl Levin, a Michigan Democrat, created a bill in February 2007, the Stop Tax Haven Abuse Act, to restrict the use of offshore tax havens and shelters to avoid US taxes. Levin, says "tax havens are engaged in economic warfare against the United States" and reintroduced an 84-page version of the bill earlier this month. Among other things, if passed, it would give the US Treasury Department authority to impose tougher reporting requirements on US taxpayers with dealings in "offshore secrecy" jurisdictions. Switzerland could be considered one such area.
Not only would billions of francs worth of foreign deposits likely be diverted to accounts elsewhere, but American and international companies that have long viewed Switzerland as an ideal base for European operations may begin to look away.
"Multinational companies in Switzerland are like a whole zoo with many kinds of animals and each would be touched in a different way," Martin Naville, head of the Swiss-American Chamber of Commerce in Zurich, told swissinfo. "There are a lot more risks than opportunities with this."
For the moment, talk of blacklisting remains hypothetical. The Group of 20, or G20, is slated in the coming weeks to discuss placing countries like Switzerland on a list of uncooperative tax havens.
If that happens, foreign companies with subsidiaries here could be subject to onerous audits, additional withholding taxes and – perhaps most damaging of all – public criticism in their home countries for having ties to a state deemed a financial pariah.
"I think people are right to be worried," said Werner Schiesser, a board member at BDO, an international accounting firm with offices in Zurich that does billions of dollars worth of business in the US. "Doing business with a country on the blacklist would raise a lot of eyebrows."
« Would you (open offices in Switzerland) and risk a newspaper report about investing money in a blacklisted country or just not go? »
Martin Naville, Swiss-American Chamber of Commerce Swiss brand could suffer
Such blacklist talk is not new but the critical difference this time is that Switzerland has come under simultaneous pressure from its two major trading partners – the EU and the US, which estimates it loses out on at least $100 billion (SFr118 billion) a year in tax revenues hidden in so-called offshore havens.
Naville says that Switzerland is no such haven and does not deserve to be on the list, especially since it contributes readily to the global fight against money laundering and terrorist financing.
Yet the pressure from both sides of the Atlantic has been enough so far to squeeze Switzerland, Andorra, Austria and Liechtenstein into softening laws on bank client confidentiality. It's unclear whether relaxing those laws will be enough to keep countries off the list.
Although the G20 has no binding legal authority, placing Switzerland on a blacklist would still carry significant consequences for both companies here as well as those looking to relocate.
"Pragmatically, say you are in charge of evaluating sites and you bring a project to your board in America and say we want to relocate 100 people to Switzerland," Naville said. "Someone might say, isn't it on a black list? Would you do it and risk a newspaper report about investing money in a blacklisted country or just not go?"
Swiss exporters could also find their competitive edge grow dull. Blacklisting could overshadow the country's reputation for high quality construction and well-defined standards.
"With reputation alone, blacklisting would change this to an extent that one could feel," Schiesser said. "For financial institutions, there would be a lower inflow from day one."
Export companies at risk
For a huge company like BDO, which provides bookkeeping services in 110 countries and employs 900 people in Switzerland and 44,000 people worldwide, having Switzerland blacklisted could change their client base and the way they do audits.
But the company is far too large to pull out of Switzerland altogether and the benefits for staying are still clear.
"We won't lose the multi-language skills of the people, the open society, the open business and good transportation," Schiesser said. "But taxes are always an issue."
Smaller exporters with offices in Switzerland and the US could be affected the most, since they have little political clout and fewer resources to deal with increased scrutiny and paperwork.
Black Diamond Equipment is one of those companies, though it has no plans to leave. The climbing- and ski-gear manufacturer based in Salt Lake City, Utah, picked Basel for its European base.
"Business law here is the most similar to the US in terms of reporting systems and how you run a company," said CEO Christian Jäggi. "Switzerland was the perfect solution for us."
European revenues
Since 1997, sales from the European arm of Black Diamond have erupted to generate about one-third of all revenue, which is about $100 million, although Black Diamond Europe has just 25 employees compared with 425 at the US headquarters.
But the balance sheets could change were Switzerland to be blacklisted, since the company might have to set aside a higher percentage of its budget as a safeguard withholding tax for US authorities.
"It'd be quite the headache," Jäggi said.
Other issues could arise over patents and royalty payments. If an overseas parent company has a subsidiary based in Switzerland that holds a patent, the parent company might have to pay the subsidiary royalties without being able to deduct the costs.
Either way, options for finding a way out could be dwindling.
"We have we try to make the Swiss authorities act quicker than in the past," Schiesser said. "We have to be very careful to keep tax environment is still interesting for US firms to have headquarters in Switzerland."
swissinfo, Tim Neville
FRIENDS, RIGHT?
Switzerland and the United States have a long history of cooperating on trade. In late November 1850, shortly after modern-day Switzerland came into being, the US and Switzerland signed a series of agreements. The Swiss president told parliament that year that the US offers "a treaty of friendship whereby the two freest peoples on earth will treat each other reciprocally on a footing of equality".
Today, the US estimates it loses at least $100 billion a year in tax revenue as 83 of the 100 largest companies have their profits taxed in offshore havens. Foreign private investors hold upwards of SFr2 trillion in Swiss banks. Another trillion francs are held by institutional investors.
A recent report by the US government states that 72 of that country's 100 biggest publically traded firms – such as American Express, General Motors, and IBM – have offshoots in Switzerland. Treaties between the US and Switzerland work to eliminate double taxation on dividends, interest and royalties, which help make the country attractive for European operations.
--------------------------------------------------------------------------------
USA AND SWITZERLAND
Thanks to its infrastructure, central location and competitive tax structure, Switzerland has become a major hub for foreign companies in Europe. The Swiss-American Chamber of Commerce estimates that 10% of the total Swiss gross national product – more than SFr40 billion ($33.8 billion) – is generated directly or indirectly by foreign companies. These companies employ 210,000 workers.
The US is the largest foreign direct-investor in Switzerland, with $100 billion in direct investments. There are 645 US companies operating in Switzerland. They provide about 71,000 direct jobs and about 120,000 total jobs.
For Switzerland, the US is the second-largest export market behind Germany. The Swiss sell more goods to Americans than to the French or Italians. Switzerland currently has about $163 billion in direct investments in the US, making the tiny alpine nation the seventh largest foreign investor. There are 560 Swiss companies operating in the US. They provide 310,000 direct jobs and about 500,000 indirect jobs.
To be safe at home, keep an eye on neighbours
The Telegraph, Kolkota
NISHIT DHOLABHAI
New Delhi, March 18: Are we safer?
It is a famous, or notorious, argument that former home minister Shivraj Patil often used to seek cover from criticism — that compared to 36,259 incidents and 11,714 civilian deaths during the BJP’s tenure, there were only 25,042 incidents and 6,646 deaths during 2004-08. Even so, his perceived lapses had piled up so high he had to quit in the immediate aftermath of 26/11.
It could be argued that terror, by its very nature, is seldom easy to counter or contain, but then a democracy demands responsibility and Patil had to pay the price for dereliction.
His tenure as boss of the home ministry was replete with incidents that put the nation on edge. There were terrorist attacks with unprecedented impunity in Guwahati, Delhi, Ahmedabad, Jaipur, Varanasi, Lucknow, Kanpur, Hyderabad and Bangalore that were allegedly perpetrated through local modules of mostly Pakistan-based groups. There were also attacks on the railways, one of them on the Samjhauta Express to Pakistan shortly after it left Delhi.
Since 2006, hundreds were killed or maimed in these attacks and millions of rupees worth of property lost. Public confidence lay shattered. The attacks left a deep scar on the collective psyche of the nation. People began to think, very justifiably, that no place was safe.
India may still be a safer place than most others in the region, but things are changing fast. And a lot of that has to do with the grim security scenario in the neighbourhood — the expansion of jihadi and Taliban elements in both Pakistan and Bangladesh, in the main. Internal security is becoming more and more a function of keeping an eye on external factors.
The UPA government constituted the National Investigation Agency (NIA), one more to add to the long list of security agencies after the shock of Mumbai. The intelligence gathering mechanism was strengthened by sanctioning the hiring of 6,000 more people and measures for better co-ordination. The scope of security agencies like the CISF was expanded and the number of paramilitary forces increased by more than two lakh.
After the spectacular attack in Mumbai, the government decided to secure India’s 7,500km maritime boundary and set up a better co-ordination mechanism involving the navy.
Each of these desperate measures after the country was hit hard on November 26, 2008, however, are also “incremental” and do not give the “critical mass” to the security apparatus to deal with the situation, say experts. Therefore, though the NIA has been constituted to shut up political criticism, the agency does not have an office and only a paltry Rs 10 crore was allocated in the first financial year.
Two, in the process of looking at new things, the obvious was often overlooked. Attempts have been made to improve intelligence, but age-old systems proven efficacious were left to die.
The watch-and-ward system, which for years served as the eyes and ears of law enforcers at the lowest level, was allowed by successive governments to simply lapse into revenue functions rather than active reporting at the grassroots level.
Similar disadvantages have accrued from the failure of the governments to prevent ghettoisation of places like Ahmedabad. The age-old culture of living together and, as a result, watching and restraining one another, disappeared with the separation of communities.
Security can be compromised if crime and seeds of terror are inevitably sown in the ill-ventilated shanties of ghettos like Juhapura. There was no dearth of rhetoric in Delhi, but concerted action was missing.
Yes, in Jammu and Kashmir and the Northeast the government can pat its back for a combination of measures it took.
In Jammu and Kashmir, the government has successfully manoeuvred to bring terror groups under control and even allowed a pullback of troops from Srinagar, bringing down tension. This may be partly attributed to the changed situation in Pakistan but Delhi put its heart in getting things back on track.
In the Northeast, Tripura sprung into action on the development front by defeating insurgency and leading in horticulture; in Assam, the Ulfa is on the run; and in Nagaland, the peace process continues with hope. People in Manipur continue to suffer but Mizoram is raring to go.
The home ministry got tough with insurgent groups and successfully allowed space for development while balancing regional interests. At the same time, it was able to convince Bangladesh and Myanmar of discouraging Indian insurgent groups. Although reports suggest Chinese incursions continue in Arunachal Pradesh, the writ of Naga militant groups in Changlang and Tirap is greatly reduced compared to five years ago.
Loss of marks for this government in the first half of its tenure came with the rise in Left-wing extremism but it made up for the losses with some out-of-the-box measures. The integrated development-cum-security projects are working wonders in tandem with vastly modernised police forces in Naxalite-affected states.
It is this region of more than seven states that could cost the Indian nation a lot as Naxalites seem on the warpath. But then, home minister P. Chidambaram too has declared war on the “nihilists and anarchists”.
Any government who comes to power in May/June will have fixed challenges — terrorism, Naxalism, porous international boundaries and rabid communalism — which will need constant doses of antidotes.
NISHIT DHOLABHAI
New Delhi, March 18: Are we safer?
It is a famous, or notorious, argument that former home minister Shivraj Patil often used to seek cover from criticism — that compared to 36,259 incidents and 11,714 civilian deaths during the BJP’s tenure, there were only 25,042 incidents and 6,646 deaths during 2004-08. Even so, his perceived lapses had piled up so high he had to quit in the immediate aftermath of 26/11.
It could be argued that terror, by its very nature, is seldom easy to counter or contain, but then a democracy demands responsibility and Patil had to pay the price for dereliction.
His tenure as boss of the home ministry was replete with incidents that put the nation on edge. There were terrorist attacks with unprecedented impunity in Guwahati, Delhi, Ahmedabad, Jaipur, Varanasi, Lucknow, Kanpur, Hyderabad and Bangalore that were allegedly perpetrated through local modules of mostly Pakistan-based groups. There were also attacks on the railways, one of them on the Samjhauta Express to Pakistan shortly after it left Delhi.
Since 2006, hundreds were killed or maimed in these attacks and millions of rupees worth of property lost. Public confidence lay shattered. The attacks left a deep scar on the collective psyche of the nation. People began to think, very justifiably, that no place was safe.
India may still be a safer place than most others in the region, but things are changing fast. And a lot of that has to do with the grim security scenario in the neighbourhood — the expansion of jihadi and Taliban elements in both Pakistan and Bangladesh, in the main. Internal security is becoming more and more a function of keeping an eye on external factors.
The UPA government constituted the National Investigation Agency (NIA), one more to add to the long list of security agencies after the shock of Mumbai. The intelligence gathering mechanism was strengthened by sanctioning the hiring of 6,000 more people and measures for better co-ordination. The scope of security agencies like the CISF was expanded and the number of paramilitary forces increased by more than two lakh.
After the spectacular attack in Mumbai, the government decided to secure India’s 7,500km maritime boundary and set up a better co-ordination mechanism involving the navy.
Each of these desperate measures after the country was hit hard on November 26, 2008, however, are also “incremental” and do not give the “critical mass” to the security apparatus to deal with the situation, say experts. Therefore, though the NIA has been constituted to shut up political criticism, the agency does not have an office and only a paltry Rs 10 crore was allocated in the first financial year.
Two, in the process of looking at new things, the obvious was often overlooked. Attempts have been made to improve intelligence, but age-old systems proven efficacious were left to die.
The watch-and-ward system, which for years served as the eyes and ears of law enforcers at the lowest level, was allowed by successive governments to simply lapse into revenue functions rather than active reporting at the grassroots level.
Similar disadvantages have accrued from the failure of the governments to prevent ghettoisation of places like Ahmedabad. The age-old culture of living together and, as a result, watching and restraining one another, disappeared with the separation of communities.
Security can be compromised if crime and seeds of terror are inevitably sown in the ill-ventilated shanties of ghettos like Juhapura. There was no dearth of rhetoric in Delhi, but concerted action was missing.
Yes, in Jammu and Kashmir and the Northeast the government can pat its back for a combination of measures it took.
In Jammu and Kashmir, the government has successfully manoeuvred to bring terror groups under control and even allowed a pullback of troops from Srinagar, bringing down tension. This may be partly attributed to the changed situation in Pakistan but Delhi put its heart in getting things back on track.
In the Northeast, Tripura sprung into action on the development front by defeating insurgency and leading in horticulture; in Assam, the Ulfa is on the run; and in Nagaland, the peace process continues with hope. People in Manipur continue to suffer but Mizoram is raring to go.
The home ministry got tough with insurgent groups and successfully allowed space for development while balancing regional interests. At the same time, it was able to convince Bangladesh and Myanmar of discouraging Indian insurgent groups. Although reports suggest Chinese incursions continue in Arunachal Pradesh, the writ of Naga militant groups in Changlang and Tirap is greatly reduced compared to five years ago.
Loss of marks for this government in the first half of its tenure came with the rise in Left-wing extremism but it made up for the losses with some out-of-the-box measures. The integrated development-cum-security projects are working wonders in tandem with vastly modernised police forces in Naxalite-affected states.
It is this region of more than seven states that could cost the Indian nation a lot as Naxalites seem on the warpath. But then, home minister P. Chidambaram too has declared war on the “nihilists and anarchists”.
Any government who comes to power in May/June will have fixed challenges — terrorism, Naxalism, porous international boundaries and rabid communalism — which will need constant doses of antidotes.
National seminar on "Contribution of South India to Indian Religion"
A national seminar on "Contribution of South India to Indian Religion and Philosophy" will be held at Chennai as follows:
Dates: March 25, 26 and 27, 2009.
Time: March 25 - Wed: Inauguration: 3 to 6 pm.
March 26 - Thu: 10 to 5 pm.
March 27 - Fri: 10 to 5 pm.
Place: Pasumpon Thevar Kalyana Mantapam, Habibullah Road, T. Nagar, Chennai - 600 017.
Near: Kodambakkam Railway station (Walkable distance). Can be reached from Usman Road also.
Those Interested can attend, particularly those who are in Chennai.
REPLY TO : Vedaprakash vedamvedaprakash@yahoo.com
cell: 9840202065 RSVP.
Dates: March 25, 26 and 27, 2009.
Time: March 25 - Wed: Inauguration: 3 to 6 pm.
March 26 - Thu: 10 to 5 pm.
March 27 - Fri: 10 to 5 pm.
Place: Pasumpon Thevar Kalyana Mantapam, Habibullah Road, T. Nagar, Chennai - 600 017.
Near: Kodambakkam Railway station (Walkable distance). Can be reached from Usman Road also.
Those Interested can attend, particularly those who are in Chennai.
REPLY TO : Vedaprakash vedamvedaprakash@yahoo.com
cell: 9840202065 RSVP.
Varun Gandhi Vs Dr. Masood Ahmed : Any TV Channel cared to cover it?
The below speech of UP ex-Minister Dr. Masood Ahmed, came more than a week before Varun Gandhi's speech, from the same constituency, Pilibhit.
Any TV Channel cared to cover it? Any election commission official issued notice to him for communalization?
Dainik Jagran reports:http://in.jagran.yahoo.com/news/local/uttarpradesh/4_1_5290624_1.html
अब तक सभी दलों ने मुस्लिमों को छला : डॉ. मसूद
Pilibhit: Mar 06, 2009
पीलीभीत। नेशनल लोक हिन्द पार्टी के अध्यक्ष एवं पूर्व शिक्षा मंत्री डॉ. मसूद अहमद ने मुसलमानों से कहा कि जब तक वे अपना नेता नहीं बनाएंगे, तब तक उनकी उपेक्षा होती रहेगी। उन्होंने सपा, बसपा, भाजपा और कांग्रेस को निशाने पर लेते हुए आरोप लगाया कि सभी ने मुस्लिमों का अहित किया है।
बृहस्पतिवार को शहर के रामस्वरूप पार्क में आयोजित चुनावी सभा में नेलोपा अध्यक्ष ने मुस्लिमों से कहा कि वे अपने अंदर गैरत पैदा करे तभी उन्हें हुकूमत में हिस्सा मिलेगा। उन्होंने कहा का कांग्रेस, सपा और बसपा ने कुछ मोहरे बना रखे है, उन्हीं के सहारे मुस्लिमों के वोट हथिया लेते है। आरोप लगाया कि मायावती दलितों की और मुलायम सिंह यादवों के नेता है। वे सिर्फ वोट के लिए मुस्लिमों से कोरी हमदर्दी जताते है। अगर मुस्लिमों को अधिकार चाहिए तो उन्हे अपना नेता बनाना पड़ेगा, वरना अन्य नेताओं के पिछलग्गू बनकर अपने वोट लुटाते रहोगे। उन्होंने कांग्रेस को सबसे घटिया पार्टी बताते हुए कहा कि इसने मुल्क के तीन टुकड़े करा दिए। देश का मुसलमान इसी की सफाई देने में लगा है कि हम गुनहगार नहीं है। हिन्दू कट्टरवादी फौज के अफसर को पटाकर बम बनवाते है और मुस्लिमों को आईएसआई का एजेंट और मदरसों को आतंकियों के ट्रेनिंग कैम्प बताते है। इस मुद्दे पर कोई नेता मुस्लिमों के साथ खड़ा नहीं दिख रहा।
डॉ. मसूद ने कहा कि इस देश को आजाद हुए साठ साल से अधिक समय हो गया। मुस्लिमों को क्या मिला। न शासन में न प्रशासन में जगह मिली और न ही फौज या पुलिस में उनके बच्चों लिया गया। उन्होंने मुस्लिमों का आह्वान किया कि वे एकजुट होकर नेलोपा प्रत्याशी हफीज अहमद अल्वी को जिताएं। नेलोपा मजबूत हुई तो मुस्लिम वर्ग मजबूत होगा।
http://in.jagran.yahoo.com/news/local/uttarpradesh/4_1_5290624_1.html
Any TV Channel cared to cover it? Any election commission official issued notice to him for communalization?
Dainik Jagran reports:http://in.jagran.yahoo.com/news/local/uttarpradesh/4_1_5290624_1.html
अब तक सभी दलों ने मुस्लिमों को छला : डॉ. मसूद
Pilibhit: Mar 06, 2009
पीलीभीत। नेशनल लोक हिन्द पार्टी के अध्यक्ष एवं पूर्व शिक्षा मंत्री डॉ. मसूद अहमद ने मुसलमानों से कहा कि जब तक वे अपना नेता नहीं बनाएंगे, तब तक उनकी उपेक्षा होती रहेगी। उन्होंने सपा, बसपा, भाजपा और कांग्रेस को निशाने पर लेते हुए आरोप लगाया कि सभी ने मुस्लिमों का अहित किया है।
बृहस्पतिवार को शहर के रामस्वरूप पार्क में आयोजित चुनावी सभा में नेलोपा अध्यक्ष ने मुस्लिमों से कहा कि वे अपने अंदर गैरत पैदा करे तभी उन्हें हुकूमत में हिस्सा मिलेगा। उन्होंने कहा का कांग्रेस, सपा और बसपा ने कुछ मोहरे बना रखे है, उन्हीं के सहारे मुस्लिमों के वोट हथिया लेते है। आरोप लगाया कि मायावती दलितों की और मुलायम सिंह यादवों के नेता है। वे सिर्फ वोट के लिए मुस्लिमों से कोरी हमदर्दी जताते है। अगर मुस्लिमों को अधिकार चाहिए तो उन्हे अपना नेता बनाना पड़ेगा, वरना अन्य नेताओं के पिछलग्गू बनकर अपने वोट लुटाते रहोगे। उन्होंने कांग्रेस को सबसे घटिया पार्टी बताते हुए कहा कि इसने मुल्क के तीन टुकड़े करा दिए। देश का मुसलमान इसी की सफाई देने में लगा है कि हम गुनहगार नहीं है। हिन्दू कट्टरवादी फौज के अफसर को पटाकर बम बनवाते है और मुस्लिमों को आईएसआई का एजेंट और मदरसों को आतंकियों के ट्रेनिंग कैम्प बताते है। इस मुद्दे पर कोई नेता मुस्लिमों के साथ खड़ा नहीं दिख रहा।
डॉ. मसूद ने कहा कि इस देश को आजाद हुए साठ साल से अधिक समय हो गया। मुस्लिमों को क्या मिला। न शासन में न प्रशासन में जगह मिली और न ही फौज या पुलिस में उनके बच्चों लिया गया। उन्होंने मुस्लिमों का आह्वान किया कि वे एकजुट होकर नेलोपा प्रत्याशी हफीज अहमद अल्वी को जिताएं। नेलोपा मजबूत हुई तो मुस्लिम वर्ग मजबूत होगा।
http://in.jagran.yahoo.com/news/local/uttarpradesh/4_1_5290624_1.html
Why is Varun Gandhi Angry : Comments
In a prime time discussion with Rajdeep Sardesai on CNN-IBN on 17th March at 9 pm show veteran journalist and columnist Tarun Vijay said that Varun Gandhi hasn't spoken against any community. Pilibhit is run under a complete Islamic dispensation with the District Magistrate, Additional D.M., Sub Divisional Magistrate- all Muslims posted there. Its represented by three MLAs and all of them are Muslims. In the last couple of months five hundred cows were slaughtered by Muslims and
reported to administration through Maneka Gandhi's office. Nothing happened. Kidnappings and rapes of Hindu girls is a matter of routine.
Its a border area , neighbouring Nepal and hence all sorts of criminal activities goes on. So in this situation Varun Gandhi only tried to infuse some confidence and assure them that they are not alone. Varun only sworn on Gita as a Hindu. Any one, including me would do that-if someone attacks my sister or mother , I would say-I shall not spare the attacker. Varun's missive was against the traitors and anti-national's like Afzal and Kasab. He was emotional and didnt utter the words that are being attributed to him ie naming any community.
-- Tarun Vijay
Bravo indeed! Varun comes out in very positive light indeed. he is articulate, patriotic and and open. And he is not a thief with money in Swiss banks. Let the 'youthful' Rahul come out of hiding and face the cameras. The difference is there for all to see. The media and the 'Secularists' will go after Varun because they see he poses a threat to their hero Rahul. we must spare no effort supporting him.
N.S. Rajaram
Was a criminal case filed against his paternal "maut ka saudagar" aunt?Now even to speak up in defence of Hindus is "criminal".
-- Kishen kak
I have seen Varun's video. What did he say that is so objectionable? When did announcement to protect Hindus from whoever become a crime? He did not say he will kill someone belonging to any particular group. Did he? Why don't the seculars ask the Muslims what do they say about the Koran which openly call for killing the infidels. I think this needs a petition and soon -- mentioning these and other relevant points which we can up with.
--Vinod
The incident reflects that one cannot say anything publicly in favour of the Hindus. Varun Gandhi has not propagated hatred against any community. He only said that the perpetrators of oppression and torture on the Hindus should be punished. But he is being harassed for his speech. The incident also reflects that, India has already turned into an Islamic state, which is yet to be officially declared. It
is really shameful that much hue and cry is now being raised for his speech and an arrest warrant has been issued against him. On the contrary, nearly a year ago, Muslim cleric Barkati, imam of the Tipu Sultan mosque of Kolkata, openly declared that he would reward the killer of Sm Taslima Nasrin with Rs 5 lakhs. But our government and law enforcing authorities found his speech quite secular nonviolent and hence no arrest warrant was issued against him. Each and every Muslim of this country has come to understand that, they can do any crime and break any
law without being convicted or punished. In this context, one may recall killing of a rare species of deer by the film star Salman Khan and ex-cricket captain Mansur Ali Khan. They have also come to understand that the present pro-Muslim government would fulfill their any demand, whatever unjust it could be.
Thanks,
Dr Radhasyam Brahmachari
Banking secrecy faces an uncertain future
Switzerland's tradition of banking secrecy has come under renewed pressure as the United States takes on the country's largest financial institution.
While it has long been the subject of international criticism, banking secrecy – or client confidentiality, as the Swiss call it – has been redefined on a number of occasions.
The idea is anchored in legislation passed in 1934 after the global turbulences caused by Wall Street's 1929 crash. The question now is whether Switzerland's laws will be able to stand the test of the challenges mounted against it this year in the United States.
Swiss banking secrecy under fire
The subject is on everyone's lips after the Swiss Financial Market Supervisory Authority (Finma) and UBS - under pressure from US authorities - handed over details of up to 300 clients who are said to have evaded US taxes.
History appears to be repeating itself. In the crisis before the Second World War, European countries were anxious to limit the flight of capital abroad.
In 1932, French police for example seized lists of thousands of clients at the Basler Handelsbank offices in Paris in what became known as the "Paris affair".
Tradition of discretion
The violation of the practice of discretion, which had been cultivated for centuries by Swiss bankers, was one element that prompted authorities to enshrine the principle of secrecy in law.
The Swiss Banking Law still protects confidentiality, which has contributed both positively and negatively to Switzerland's image abroad.
Banking secrecy guarantees clients of Swiss banks that their information will be kept confidential and will not be passed on to private individuals or official bodies.
Bankers believe their professional obligation is similar to the confidentiality provided by lawyers, doctors and the clergy. If banking secrecy is violated, offenders can be liable to a fine or even imprisonment.
But over the years, international pressure has somewhat limited, redefined and weakened the fiduciary principle.
Investigations by Switzerland's banking watchdog and by criminal authorities can override it. The law can also be lifted on the order of a judicial authority, even against the client's will.
What's this? Banking secrecy Evasion or fraud
Up to now, Switzerland has succeeded in safeguarding the distinction it created between tax evasion, a civil offence, and tax fraud, a criminal one. The principle of secrecy stands in civil cases but is waived in instances in which authorities suspect a crime has occurred.
It is because of this distinction that Bern only grants administrative and judicial aid to other countries in fraud cases.
However, the case involving UBS could chip away at that distinction. The European Union and the US have been demanding its abolition for years.
Regularly criticised by Washington for all kinds of evils – as in the case of dormant accounts from the 1990s or after the terrorist attacks in the US of September, 2001 – banking secrecy is also a target of Brussels, which feels it goes against harmonising taxes among EU member states.
The last serious case dates back to 2002, when the EU wanted to impose an automatic exchange of information among national tax authorities.
Accord with EU
Switzerland, which is not an EU member, managed to preserve its banking secrecy by signing a 2004 bilateral accord on the taxation of savings, which introduced a withholding tax on the savings income of EU residents with Swiss bank accounts.
There is no doubt that the issue of taxation will be high in forthcoming talks between Bern and Brussels and a number of politicians have already made their positions clear. The outlook is not very favourable for Switzerland.
At the end of a meeting on fighting tax havens last autumn, German Finance Minister Peer Steinbrück had wanted Switzerland's name to be added to a blacklist of the Organisation for Economic Cooperation and Development.
For the time being, only Liechtenstein, Andorra and Monacco are judged to be "non-cooperative" but the list is to be revised by the middle of 2009.
From an economic standpoint, the stakes are high for a number of reasons.
Escaping the taxman
Germany's central bank, for example, claims that the equivalent of SFr745 billion escapes its tax authorities every year and estimates that 28 per cent is managed in Switzerland.
A US Senate committee recently estimated that the equivalent of SFr100 billion, held in Switzerland, Liechtenstein, the Bahamas and the Cayman Islands, escaped its taxation authorities.
About a third of global foreign savings is said to be in the hands of Swiss banks. Britain and its territories share around 24 per cent of the very lucrative and coveted wealth-management business, and the US and its territories manage around 19 per cent.
The renewed attacks on Swiss banking secrecy can also be seen in the context of the battle among global financial centres.
Today, there is no estimate on the possible consequences for Switzerland as the distinction between tax evasion and tax fraud weakens, let alone the abolition of banking secrecy.
With a financial sector that generates 11.5 per cent of gross domestic product (GDP), such scenarios may help understand why Switzerland is leaving its banking secrecy to a fate of perpetual redefinition.
swissinfo, based on an article in French by Carole Wälti
While it has long been the subject of international criticism, banking secrecy – or client confidentiality, as the Swiss call it – has been redefined on a number of occasions.
The idea is anchored in legislation passed in 1934 after the global turbulences caused by Wall Street's 1929 crash. The question now is whether Switzerland's laws will be able to stand the test of the challenges mounted against it this year in the United States.
Switzerland, Austria and Luxembourg offered to relax strict bank secrecy in some tax evasion cases on Friday in response to a global crackdown on tax havens led by the OECD.
The three countries made the concessions ahead of a meeting of finance ministers from the G20 group due to discuss tax havens.
Andorra and Liechtenstein made similar moves on Thursday, while Monaco followed on Saturday.
All were among the names handed to G20 this week by the Organisation for Economic Cooperation and Development, which maintains a blacklist of uncooperative tax havens.
Switzerland, Austria and Luxembourg said on Friday they would abide by OECD rules by cooperating on sharing information about foreign savers with other countries on a case-by-case basis, but not automatically, as many countries want.
Critically, Switzerland will now cooperate in cases of suspected tax evasion, once double taxation agreements are renegotiated with other countries, which could take time.
Previously, the world's biggest offshore centre would only cooperate with foreign authorities when they could prove outright tax fraud.
Swiss banking secrecy under fire
The subject is on everyone's lips after the Swiss Financial Market Supervisory Authority (Finma) and UBS - under pressure from US authorities - handed over details of up to 300 clients who are said to have evaded US taxes.
History appears to be repeating itself. In the crisis before the Second World War, European countries were anxious to limit the flight of capital abroad.
In 1932, French police for example seized lists of thousands of clients at the Basler Handelsbank offices in Paris in what became known as the "Paris affair".
Tradition of discretion
The violation of the practice of discretion, which had been cultivated for centuries by Swiss bankers, was one element that prompted authorities to enshrine the principle of secrecy in law.
The Swiss Banking Law still protects confidentiality, which has contributed both positively and negatively to Switzerland's image abroad.
Banking secrecy guarantees clients of Swiss banks that their information will be kept confidential and will not be passed on to private individuals or official bodies.
Bankers believe their professional obligation is similar to the confidentiality provided by lawyers, doctors and the clergy. If banking secrecy is violated, offenders can be liable to a fine or even imprisonment.
But over the years, international pressure has somewhat limited, redefined and weakened the fiduciary principle.
Investigations by Switzerland's banking watchdog and by criminal authorities can override it. The law can also be lifted on the order of a judicial authority, even against the client's will.
What's this? Banking secrecy Evasion or fraud
Up to now, Switzerland has succeeded in safeguarding the distinction it created between tax evasion, a civil offence, and tax fraud, a criminal one. The principle of secrecy stands in civil cases but is waived in instances in which authorities suspect a crime has occurred.
It is because of this distinction that Bern only grants administrative and judicial aid to other countries in fraud cases.
However, the case involving UBS could chip away at that distinction. The European Union and the US have been demanding its abolition for years.
Regularly criticised by Washington for all kinds of evils – as in the case of dormant accounts from the 1990s or after the terrorist attacks in the US of September, 2001 – banking secrecy is also a target of Brussels, which feels it goes against harmonising taxes among EU member states.
The last serious case dates back to 2002, when the EU wanted to impose an automatic exchange of information among national tax authorities.
Accord with EU
Switzerland, which is not an EU member, managed to preserve its banking secrecy by signing a 2004 bilateral accord on the taxation of savings, which introduced a withholding tax on the savings income of EU residents with Swiss bank accounts.
There is no doubt that the issue of taxation will be high in forthcoming talks between Bern and Brussels and a number of politicians have already made their positions clear. The outlook is not very favourable for Switzerland.
At the end of a meeting on fighting tax havens last autumn, German Finance Minister Peer Steinbrück had wanted Switzerland's name to be added to a blacklist of the Organisation for Economic Cooperation and Development.
For the time being, only Liechtenstein, Andorra and Monacco are judged to be "non-cooperative" but the list is to be revised by the middle of 2009.
From an economic standpoint, the stakes are high for a number of reasons.
Escaping the taxman
Germany's central bank, for example, claims that the equivalent of SFr745 billion escapes its tax authorities every year and estimates that 28 per cent is managed in Switzerland.
A US Senate committee recently estimated that the equivalent of SFr100 billion, held in Switzerland, Liechtenstein, the Bahamas and the Cayman Islands, escaped its taxation authorities.
About a third of global foreign savings is said to be in the hands of Swiss banks. Britain and its territories share around 24 per cent of the very lucrative and coveted wealth-management business, and the US and its territories manage around 19 per cent.
The renewed attacks on Swiss banking secrecy can also be seen in the context of the battle among global financial centres.
Today, there is no estimate on the possible consequences for Switzerland as the distinction between tax evasion and tax fraud weakens, let alone the abolition of banking secrecy.
With a financial sector that generates 11.5 per cent of gross domestic product (GDP), such scenarios may help understand why Switzerland is leaving its banking secrecy to a fate of perpetual redefinition.
swissinfo, based on an article in French by Carole Wälti
How Strong Is China’s Economy?
By Bhaskar Roy
Unveiling the 2009 budget and economic plan in Beijing earlier this year, Chinese Premier Wen Jiabao admitted the economic “challenges are really severe” but in typical style of positing the negative with positive, added “opportunities still exist”. Whether Wen Jiabao’s faith is based on solid grounds, or it is to assuage the jangling nerves of the country, only time will tell. But China as the third largest economic power in the world, much of which was created with international co-operation, has also a responsibility to contribute to the global economic recovery. But will they take this wise path?
Premier Wen recently expressed concern about the state of the American economy and the security of Chinese investments in the USA, especially the $727.4 billion US Treasury bonds that the Chinese government held at the end of last year. China is the biggest holder of US bonds with Japan coming second with over $ 600 billion worth of these bonds. The bonds were purchased with hard economic sense – to keep up the liquidity in the US market to allow for Chinese export growth. The policy worked well till the global economic meltdown hit America, its severest ever, perhaps more than the great depression as some economists estimate. Will China pull down its protectionist shelters? Probably to an extent. Imports are already falling more rapidly than exports. Both create unemployment and job losses in an increasingly restive society.
Premier Wen Jiabao’s $ 4 trillion budget includes a $ 586 billion economic stimulus package, a $ 139 billion (or 3% of the GDP) deficit, social security net of $ 42.84 billion and a variety of provisions for education, health care, low-income housing, job creation, environmental protection and reconstruction in regions, among other things. When figures are trotted out they sound impressive, but a close look at them may not encourage much optimism.
Except for the economic stimulus package, the budget did not reveal any really new and innovative idea. The Premier gave indications that the emphasis may return to the coastal regions, the country’s repository for export oriented industry. Of course, China is hoping that the developed markets across the world would soon recover to accept the flow of Chinese manufactured goods. On the positive side, however, some of the central China provinces have succeeded in increasing their output by increasing investment in infrastructure development.
In 2009, China recorded its lowest economic growth in several years at 9% from a 13% growth in the previous year. Wen Jiabao and several Chinese economic experts predict that the 2009 growth will be at least 8% if not 9%. An UN economic forecast this January supports this projection. Some pessimists had said earlier that the growth rate may be as low as 7%.
Premier Wen Jiabao’s report hopes to keep up growth by increasing domestic demand. China’s domestic savings is one of the highest in the world, including through purchase of government bonds. But to dislodge the domestic accumulation depends on a number of other factors including social attitudes. Such spending will also greatly depend upon how secure and stable the holder of surplus feel. The vast rural population does not have much surplus spending power. These are accumulated in the urban and industrial areas when people enjoyed in the past the “three irons” – permanent jobs, permanent free housing, and free food supplies and medical care from their employing entities.
In Premier Wen’s own words, China has to continuously post a high growth rate to maintain social stability. What he had in mind was a growth of around 10%. In other words, China has to keep running to stay in one place. That does not mean China’s economic strength had remained at a stand still. Far from it, the strength is growing significantly but it has to address the growing aspiration of the people, and growing income disparity between the rural and urban population. China is also experiencing a cultural and social security shock, transiting from a state command regime, where basic needs were provided for by the state, to a command regime with a market economy, where the ruling principle is a mix of each according to his ability, corruption and nepotism. China has firmly stepped into the future, but half way only. Going back portends unimaginable disaster. Therefore, the manner of the forward path is beginning to be questioned from within the country.
In the run up to the second session of the 11th National People’s Congress (NPC), China’s Parliament, where Premier Wen unveiled the 2009 economic vision, a group of party elders called for transparency in the work of the government and the overarching communist party. This group of liberal comprising people like the 91 year old Li Rui, one of Mao Zedong’s political secretaries purged in 1959, asked for greater freedom of the media and the law enforcing institutions. This advise was in the form of a letter to the President and Communist Party General Secretary Hu Jintao and other leaders. It was a reminder of similar demands by China’s students and youth leading to the 1989 Tien An Men (TAM) uprising of 1989.
Of immediate concern, the letter from the elders pressed for transparent checks and balances on the spending of the economic recovery programme, especially the $ 586 billion stimulus package. The spirit of this letter demanded a public scrutiny of how their money was being spent.
According to Cheng Li, research director and senior fellow at the Brooking Institution’s China Center, in the last six months of 2008, “10 million workers, plus one million college graduates, joined the already gigantic ranks of the country’s unemployed”. Over this same period, the Chinese stock market lost 65 per cent of its value, equivalent to $ 3 trillion, Mr. Cheng Li wrote in an article.
According to Chinese official media reports, banks doubled their lending in January this year corresponding to the same month last year, apparently with the declared government intention of injecting the stimulus package. Security analysts estimate that the loan recipients, mostly state owned firms, funnelled approximately a third of their loans into the stock market leading to a recovery of the Shanghai composite index.
The signs do not bode well. Following late Deng Xiaoping’s southern cyclone tour of Southern China in 1991 to counter the conservatives holding back reforms, the banks went on a lending spree that drove inflation through the roof. It created the “triangular debt” situation between the government, banks, and the State Owned Enterprises (SOEs), finally resulting in bad debts to the tune of more than a third of the economy in the late 1990s and early 2000. Production figures were inflated by the industries by producing un-saleable products, called by the Chinese media as “shoddy goods”. It was wastage of energy and raw material, and the government was forced to publicly destroy a lot of them by burning as a show to the public and punishment for the producers. But money was lost.
About four months before the 1989 TAM protests, Shanghai’s Liberation Daily ran articles warning of the imminent protests, calling for more administrative transparency. Of course, the daily was revamped from the top downwords to imprint the Party’s and the government’s supremacy. In their letters to Hu Jintao and the other leaders, the party elders were cautioning them to act before things went out of hand. An event like TAM uprising will be more devastating to the communist party’s rule, and the elders do not want that to happen.
It is notable that instead of any real media freedom, the authorities have been choking contrary and critical views. The Southern newspapers have faced the brunt of the government wrath.
Having said that, critical views are just beginning to be carried by Central newspapers like the English language China Daily, and Communist Youth League newspaper the Youth Daily.
This suggests a more serious development, the roots of which go to the top. It is difficult to say with any certainty yet which faction of the top leadership is behind the move.
The top leadership has been deliberately formed with the representatives of two camps. One is the elitist camp led by Xi Jinping, pressing for faster liberalization based on the coastal regions with modernization, liberalism and export orientation. The leader of this group are the progenies and scions of liberals of the third generation leadership. Xi is the President and party General Secretary in waiting in 2012.
The other group is the more conservative led by Ki Keqing, Prime Minister in waiting. Li is a product of the Youth League to which Hu Jintao belongs, and have been baptized in the difficult rural areas of China. Known as the Tuanpai, they subscribe to development of the poor rural areas of China to equalize development in the interest of social stability and overall endowment of economic aspirations.
Both groups appear to be unanimous about the growth and development of China’s ability to project power beyond its shores. An increase of 14.7 per cent of the 2009 defence allocation amounting to $70 billion is a testimony to their nationalism. The projected figure, in reality, is close to $ 200 billion.
Nevertheless, the bottom line is where China’s economic and social stability stand. The state media has stopped publishing figures of protests and strikes which officially stood at 80 thousand in 2006. Hence, what is really happening inside? The world will find it difficult to endure a nation of 1.3 billion (more likely 1.5 billion) suddenly descending the economic ladder.
(The author is an eminent China analyst with many years of experience of study on the developments in China. He can be reached at grouchohart@yahoo.com)
Unveiling the 2009 budget and economic plan in Beijing earlier this year, Chinese Premier Wen Jiabao admitted the economic “challenges are really severe” but in typical style of positing the negative with positive, added “opportunities still exist”. Whether Wen Jiabao’s faith is based on solid grounds, or it is to assuage the jangling nerves of the country, only time will tell. But China as the third largest economic power in the world, much of which was created with international co-operation, has also a responsibility to contribute to the global economic recovery. But will they take this wise path?
Premier Wen recently expressed concern about the state of the American economy and the security of Chinese investments in the USA, especially the $727.4 billion US Treasury bonds that the Chinese government held at the end of last year. China is the biggest holder of US bonds with Japan coming second with over $ 600 billion worth of these bonds. The bonds were purchased with hard economic sense – to keep up the liquidity in the US market to allow for Chinese export growth. The policy worked well till the global economic meltdown hit America, its severest ever, perhaps more than the great depression as some economists estimate. Will China pull down its protectionist shelters? Probably to an extent. Imports are already falling more rapidly than exports. Both create unemployment and job losses in an increasingly restive society.
Premier Wen Jiabao’s $ 4 trillion budget includes a $ 586 billion economic stimulus package, a $ 139 billion (or 3% of the GDP) deficit, social security net of $ 42.84 billion and a variety of provisions for education, health care, low-income housing, job creation, environmental protection and reconstruction in regions, among other things. When figures are trotted out they sound impressive, but a close look at them may not encourage much optimism.
Except for the economic stimulus package, the budget did not reveal any really new and innovative idea. The Premier gave indications that the emphasis may return to the coastal regions, the country’s repository for export oriented industry. Of course, China is hoping that the developed markets across the world would soon recover to accept the flow of Chinese manufactured goods. On the positive side, however, some of the central China provinces have succeeded in increasing their output by increasing investment in infrastructure development.
In 2009, China recorded its lowest economic growth in several years at 9% from a 13% growth in the previous year. Wen Jiabao and several Chinese economic experts predict that the 2009 growth will be at least 8% if not 9%. An UN economic forecast this January supports this projection. Some pessimists had said earlier that the growth rate may be as low as 7%.
Premier Wen Jiabao’s report hopes to keep up growth by increasing domestic demand. China’s domestic savings is one of the highest in the world, including through purchase of government bonds. But to dislodge the domestic accumulation depends on a number of other factors including social attitudes. Such spending will also greatly depend upon how secure and stable the holder of surplus feel. The vast rural population does not have much surplus spending power. These are accumulated in the urban and industrial areas when people enjoyed in the past the “three irons” – permanent jobs, permanent free housing, and free food supplies and medical care from their employing entities.
In Premier Wen’s own words, China has to continuously post a high growth rate to maintain social stability. What he had in mind was a growth of around 10%. In other words, China has to keep running to stay in one place. That does not mean China’s economic strength had remained at a stand still. Far from it, the strength is growing significantly but it has to address the growing aspiration of the people, and growing income disparity between the rural and urban population. China is also experiencing a cultural and social security shock, transiting from a state command regime, where basic needs were provided for by the state, to a command regime with a market economy, where the ruling principle is a mix of each according to his ability, corruption and nepotism. China has firmly stepped into the future, but half way only. Going back portends unimaginable disaster. Therefore, the manner of the forward path is beginning to be questioned from within the country.
In the run up to the second session of the 11th National People’s Congress (NPC), China’s Parliament, where Premier Wen unveiled the 2009 economic vision, a group of party elders called for transparency in the work of the government and the overarching communist party. This group of liberal comprising people like the 91 year old Li Rui, one of Mao Zedong’s political secretaries purged in 1959, asked for greater freedom of the media and the law enforcing institutions. This advise was in the form of a letter to the President and Communist Party General Secretary Hu Jintao and other leaders. It was a reminder of similar demands by China’s students and youth leading to the 1989 Tien An Men (TAM) uprising of 1989.
Of immediate concern, the letter from the elders pressed for transparent checks and balances on the spending of the economic recovery programme, especially the $ 586 billion stimulus package. The spirit of this letter demanded a public scrutiny of how their money was being spent.
According to Cheng Li, research director and senior fellow at the Brooking Institution’s China Center, in the last six months of 2008, “10 million workers, plus one million college graduates, joined the already gigantic ranks of the country’s unemployed”. Over this same period, the Chinese stock market lost 65 per cent of its value, equivalent to $ 3 trillion, Mr. Cheng Li wrote in an article.
According to Chinese official media reports, banks doubled their lending in January this year corresponding to the same month last year, apparently with the declared government intention of injecting the stimulus package. Security analysts estimate that the loan recipients, mostly state owned firms, funnelled approximately a third of their loans into the stock market leading to a recovery of the Shanghai composite index.
The signs do not bode well. Following late Deng Xiaoping’s southern cyclone tour of Southern China in 1991 to counter the conservatives holding back reforms, the banks went on a lending spree that drove inflation through the roof. It created the “triangular debt” situation between the government, banks, and the State Owned Enterprises (SOEs), finally resulting in bad debts to the tune of more than a third of the economy in the late 1990s and early 2000. Production figures were inflated by the industries by producing un-saleable products, called by the Chinese media as “shoddy goods”. It was wastage of energy and raw material, and the government was forced to publicly destroy a lot of them by burning as a show to the public and punishment for the producers. But money was lost.
About four months before the 1989 TAM protests, Shanghai’s Liberation Daily ran articles warning of the imminent protests, calling for more administrative transparency. Of course, the daily was revamped from the top downwords to imprint the Party’s and the government’s supremacy. In their letters to Hu Jintao and the other leaders, the party elders were cautioning them to act before things went out of hand. An event like TAM uprising will be more devastating to the communist party’s rule, and the elders do not want that to happen.
It is notable that instead of any real media freedom, the authorities have been choking contrary and critical views. The Southern newspapers have faced the brunt of the government wrath.
Having said that, critical views are just beginning to be carried by Central newspapers like the English language China Daily, and Communist Youth League newspaper the Youth Daily.
This suggests a more serious development, the roots of which go to the top. It is difficult to say with any certainty yet which faction of the top leadership is behind the move.
The top leadership has been deliberately formed with the representatives of two camps. One is the elitist camp led by Xi Jinping, pressing for faster liberalization based on the coastal regions with modernization, liberalism and export orientation. The leader of this group are the progenies and scions of liberals of the third generation leadership. Xi is the President and party General Secretary in waiting in 2012.
The other group is the more conservative led by Ki Keqing, Prime Minister in waiting. Li is a product of the Youth League to which Hu Jintao belongs, and have been baptized in the difficult rural areas of China. Known as the Tuanpai, they subscribe to development of the poor rural areas of China to equalize development in the interest of social stability and overall endowment of economic aspirations.
Both groups appear to be unanimous about the growth and development of China’s ability to project power beyond its shores. An increase of 14.7 per cent of the 2009 defence allocation amounting to $70 billion is a testimony to their nationalism. The projected figure, in reality, is close to $ 200 billion.
Nevertheless, the bottom line is where China’s economic and social stability stand. The state media has stopped publishing figures of protests and strikes which officially stood at 80 thousand in 2006. Hence, what is really happening inside? The world will find it difficult to endure a nation of 1.3 billion (more likely 1.5 billion) suddenly descending the economic ladder.
(The author is an eminent China analyst with many years of experience of study on the developments in China. He can be reached at grouchohart@yahoo.com)
CAMBODIA: Middle East targets land, energy deals
The Phnom Penh Post
Middle East targets land, energy deals
Written by George Mcleod
Friday, 13 March 2009
Cambodia's traditional sectors are foundering in the wake of the global financial crisis, but the Kingdom's farmlands could bring billions from Middle Eastern countries seeking food security.
BANGKOK - With high-profile government visits and massive deals in the works, Middle Eastern countries are competing to carve out an economic and political stake in Cambodia. Land leases and energy agreements are being negotiated by Kuwait and Qatar, while Israeli companies are hoping to ink agricultural technology and telecoms contracts.
Governments are backing the push into Cambodia, and the prime ministers of Kuwait and Qatar already visited last year.
Israel is joining the game, with its first major delegation scheduled to arrive Monday. Iran is also taking a role under its Look East policy to boost Asian trade in the face of Western sanctions.
Analysts say growing Middle Eastern interest puts Cambodia on the map and in the middle of a power contest for political and economic footholds in Asia.
"In a way, the economic crisis has made Asia an even greater focus for the Middle East because there is more competition for markets," said Middle East expert Yossi Mekelberg from Chatham House in London.
"Middle Eastern countries are attracted to Cambodia in part because [Cambodia] doesn't care about the Arab-Israeli conflict, or about politics.
[Cambodia] wants investment. It gives Middle Eastern countries soft power in the region," he said
Israel's biggest-ever delegation arrived in Phnom Penh Monday, with telecoms and agriculture firms saying they have big plans for Cambodia
Photo by: George Mcleod
From left to right: Israeli delegate Yitzhak Kiriati; Ministry of Commerce Secretary of State Pan Sorasak; Israeli Ambassador Yael Rubinstein and Israeli trade attache Tzahi Selzer. With Cambodia's huge agricultural potential and Israel's world-class technology, the two countries have a bright future of cooperation ahead of them, said Israeli Ambassador Yael Rubinstein on Monday in Phnom Penh during her country's largest-ever visit to the Kingdom.
Included with the delegation were representatives of Israel's top agriculture technology companies, offering what they say are the world's most advanced farming methods.
"One of our most important messages is that we see agriculture as a business - not just a way of feeding people," said Yitzhak Kiriati, director of the Israel Export and International Cooperation Institute, a government-private export promotion group.
"We are not coming to Cambodia to save hungry people - we are here to make people make money from agriculture," he said.
He said Israel will be working to introduce new technologies and to change methods used on Cambodian farms.
"Israeli agriculture operates as a system - you pool resources.... We will be working with Cambodia to increase not only the technology, but the way that farms organise themselves."
No deals were signed, but a delegation spokesman said he expects major announcements before year's end.
Technology needed
Local agricultural experts said the Israeli visit could bring much-needed advancements to a sector plagued by inefficiency and low productivity.
"There are serious problems in Cambodia with a lack of investment - agriculture needs more support and loans for small farmers," said Yang Saing Koma, president of CEDAC - a local agriculture development association.
One of our most important messages is … we see agriculture as a business.
Israel is an arid, desert country that has become an important agriculture exporter, in part because of advanced irrigation, greenhouses and fertilisers. One of its most famous technologies is "drip irrigation" that waters plants individually, cutting evaporation and waste.
The Israeli government told the Post better farming techniques have allowed it to boost agriculture earnings from US$0.50 per cubic litre of water to $4.00 in the past 60 years. These technologies could fit well in Cambodia's wet-dry climate, say local experts.
"We are growing rice in the wet season, but we really aren't growing much in the dry season. We should be growing vegetables in the dry season, but we need better irrigation, and greenhouses," said Yang Saing Koma.
Agricultural advancements would pay off in terms of poverty reduction and economic growth, say experts. World Bank figures say 59 percent of Cambodians rely on agriculture. Rice yields in Cambodia are a low 2.6 tonnes per hectare, compared with 3.5 in Thailand and close to six in China.
"[Agriculture sector] growth is constrained by the poor use of fertilisers, weak irrigation systems and rural roads, limited access to credit and poor research," said the World Bank in its 2008 report.
Telecoms were also an area of focus for the delegation.
"Cambodia's telecoms market is expanding fast," said Eyal Mayer, director for Business Development and Project Management at Celtro, a mobile phone technology firm.
"The prospects for Cambodia are very strong indeed."
Amnon Ferber from the Israel Export & International Cooperation Institute said that the Cambodian market would be especially lucrative for small- and medium-sized Israeli companies.
"There is a lot of competition in India and China, so Cambodia is very interesting for Israeli business," he said.
But Israel's politics continue to be a subject of debate, and the head of the Palestine Solidarity Council (PSC) in Thailand said that the Israel delegation's visit to Phnom Penh is nothing to celebrate. "Cambodia should steer clear of Israeli investment.... We can and should be doing something about the violence against the Palestinians through nonviolent means," said PSC Chairman Stuart Ward.
Only daily Sanskrit news paper "Sudharma" is now online
The only daily Sanskrit news paper "Sudharma" is now online. You can read the news paper here http://sudharma.epapertoday.com. This newspaper is being published from Mysore for the last 39 years now.
History
Kalale Nadadur Varadaraja Iyengar, a Sanskrit scholar, launched this paper in the year 1970 with a goal of propagating the language. He was also a publisher of Sanskrit books and the Sanskrit moving types that were sometimes lying idle with him were another motivation for starting the newspaper. When he discussed his venture with others, he had to face the wrath of skeptics who warned him of his ‘misadventure’ and predicted the newspaper’s doom. This was because not many people believed that the Sanskrit language had a vocabulary sufficient enough to cover contemporary and complex day-to-day activities and developments. He was, however, supported in his venture by Agaram Rangaiah, who was an editor of a Kannada newspaper and also by P. Nagachar, who was a former Joint Director of Information. Ignoring the skeptics, Varadaraja Iyengar published the first issue of Sudharma on July 14, 1970 from a location called ‘Ganapathi Totti’ in Maharaja’s Sanskrit College. He was also instrumental in starting a Sanskrit news bulletin on All India Radio by convincing I. K. Gujral, the then Minister of Information and Broadcasting in the Government of India. K. V. Sampath Kumar, the son of Varadaraja Iyengar, is the current editor of the newspaper. The paper is currently published out of a press in the # 561, 2nd Cross, Ramachandra Agrahara locality of Mysore.
Circulation
The majority of the subscribers of the newspaper are Sanskrit scholars and students. The paper has a daily circulation of about 2000 copies. It has an annual subscription fee of Rs. 250 (about $6) and is circulated via post to academic institutions, public libraries and to readers throughout India. The paper is also subscribed to by readers in countries like Japan and the U.S.A with an annual overseas subscription fee of $50.
Current scenario
The profit gained by circulating the newspaper is negligible but Sampath Kumar wants to continue publishing the newspaper because of his passion for journalism and the Sanskrit language. He has had to struggle to keep the publication afloat. The paper has also helped its readers to learn and improve their knowledge of the language. On 15th July 2007, the 38th anniversary of the paper’s publication was celebrated in Mysore. A unique feature of the celebration was that all speeches were in Sanskrit, which is a rarity, and two Sanskrit scholars were honoured on that occasion.
Address:- Sudharma Editor: Sri KV Sampath Kumar No. 561, 2nd cross, Ramachandra Agrahara, Mysore - 570 004 Karnataka INDIA 0821-244-2835
History
Kalale Nadadur Varadaraja Iyengar, a Sanskrit scholar, launched this paper in the year 1970 with a goal of propagating the language. He was also a publisher of Sanskrit books and the Sanskrit moving types that were sometimes lying idle with him were another motivation for starting the newspaper. When he discussed his venture with others, he had to face the wrath of skeptics who warned him of his ‘misadventure’ and predicted the newspaper’s doom. This was because not many people believed that the Sanskrit language had a vocabulary sufficient enough to cover contemporary and complex day-to-day activities and developments. He was, however, supported in his venture by Agaram Rangaiah, who was an editor of a Kannada newspaper and also by P. Nagachar, who was a former Joint Director of Information. Ignoring the skeptics, Varadaraja Iyengar published the first issue of Sudharma on July 14, 1970 from a location called ‘Ganapathi Totti’ in Maharaja’s Sanskrit College. He was also instrumental in starting a Sanskrit news bulletin on All India Radio by convincing I. K. Gujral, the then Minister of Information and Broadcasting in the Government of India. K. V. Sampath Kumar, the son of Varadaraja Iyengar, is the current editor of the newspaper. The paper is currently published out of a press in the # 561, 2nd Cross, Ramachandra Agrahara locality of Mysore.
Circulation
The majority of the subscribers of the newspaper are Sanskrit scholars and students. The paper has a daily circulation of about 2000 copies. It has an annual subscription fee of Rs. 250 (about $6) and is circulated via post to academic institutions, public libraries and to readers throughout India. The paper is also subscribed to by readers in countries like Japan and the U.S.A with an annual overseas subscription fee of $50.
Current scenario
The profit gained by circulating the newspaper is negligible but Sampath Kumar wants to continue publishing the newspaper because of his passion for journalism and the Sanskrit language. He has had to struggle to keep the publication afloat. The paper has also helped its readers to learn and improve their knowledge of the language. On 15th July 2007, the 38th anniversary of the paper’s publication was celebrated in Mysore. A unique feature of the celebration was that all speeches were in Sanskrit, which is a rarity, and two Sanskrit scholars were honoured on that occasion.
Address:- Sudharma Editor: Sri KV Sampath Kumar No. 561, 2nd cross, Ramachandra Agrahara, Mysore - 570 004 Karnataka INDIA 0821-244-2835
ECONOMIC NATIONALISM: China's statement on rejecting Coke's Huiyuan bid
"Following an investigation, the Ministry of Commerce determined: the concentration involved in this proposal would have an unfavourable impact on competition.
"Following concentration, Coca-Cola may have been able to use its dominant status in the carbonated soft-drinks market to use bundling and tie-ins of juice beverage sales or to set other exclusionary transactional terms, with the concentration restricting market competition in the juice beverage market and leading to consumers being forced to accept higher prices and fewer choices of products.
"In addition, due to restrictions on market entry by existing brands, potential competitors would have found it hard to surmount an outcome tantamount to restricting competition.
"Furthermore, the concentration would have narrowed the room for survival of medium and small-sized domestic juice firms, creating an unhealthy impact on the competitive structure of China's juice beverage market.
"To reduce the negative impact of the concentration on competition, the Ministry of Commerce negotiated with Coca-Cola about appending restrictive terms and asked the bidder to offer a feasible resolution proposal.
"Coca-Cola expressed its own opinions about the issues raised by the Ministry of Commerce, and submitted a preliminary resolution proposal and a revised proposal.
"After evaluation, the Ministry of Commerce believes this revised proposal still could not effectively reduce the negative impact on competition of this concentration. Therefore, based on Article 28 of the Anti-Monopoly Law, the Ministry of Commerce has made the decision to forbid the deal.
"The Anti-Monopoly Law review is meant to protect fair market competition and guard the interests of consumers and the public.
"The Ministry has received 40 applications since the Anti-Monopoly Law was launched on August 1, 2008, and the Ministry has, in accordance with the law, looked into 29 of them, out of which 24 cases have been decided upon (before this case).
"Among those, 23 cases were approved without any conditions; for the one that would have excluded and restricted competition, the Ministry talked with the applicant, and the applicant provided a solution for reducing restrictions on competition and made promises, for which the Ministry finally approved the deal with a restrictive condition of reducing unfavourable impacts on competition."
"Following concentration, Coca-Cola may have been able to use its dominant status in the carbonated soft-drinks market to use bundling and tie-ins of juice beverage sales or to set other exclusionary transactional terms, with the concentration restricting market competition in the juice beverage market and leading to consumers being forced to accept higher prices and fewer choices of products.
"In addition, due to restrictions on market entry by existing brands, potential competitors would have found it hard to surmount an outcome tantamount to restricting competition.
"Furthermore, the concentration would have narrowed the room for survival of medium and small-sized domestic juice firms, creating an unhealthy impact on the competitive structure of China's juice beverage market.
"To reduce the negative impact of the concentration on competition, the Ministry of Commerce negotiated with Coca-Cola about appending restrictive terms and asked the bidder to offer a feasible resolution proposal.
"Coca-Cola expressed its own opinions about the issues raised by the Ministry of Commerce, and submitted a preliminary resolution proposal and a revised proposal.
"After evaluation, the Ministry of Commerce believes this revised proposal still could not effectively reduce the negative impact on competition of this concentration. Therefore, based on Article 28 of the Anti-Monopoly Law, the Ministry of Commerce has made the decision to forbid the deal.
"The Anti-Monopoly Law review is meant to protect fair market competition and guard the interests of consumers and the public.
"The Ministry has received 40 applications since the Anti-Monopoly Law was launched on August 1, 2008, and the Ministry has, in accordance with the law, looked into 29 of them, out of which 24 cases have been decided upon (before this case).
"Among those, 23 cases were approved without any conditions; for the one that would have excluded and restricted competition, the Ministry talked with the applicant, and the applicant provided a solution for reducing restrictions on competition and made promises, for which the Ministry finally approved the deal with a restrictive condition of reducing unfavourable impacts on competition."
Obama's softening on Taliban is a danger
Govind Talwalkar
http://www.asianage.com/presentation/leftnavigation/opinion/opinion/obama's-softening-on-taliban-is-a-danger.aspx
March.17 : A few weeks ago US President Barack Obama announced that he would send 17,000 more troops to Afghanistan and also appealed to the Nato allies to increase their military strength in Afghanistan. Nobody is sure whether this appeal would be heeded by the allies.
At the same time, in an interview to the New York Times, Mr Obama said that the possibility of having some dialogue with the "moderate" Taliban would be explored by the US.
He is aware of the complexity of the problem, but he said that as was done in Iraq, the moderate elements in Afghanistan would also be contacted. If this is so, then why should the allies increase the number of troops deployed?
In his campaign speeches, and also at the time of his inauguration, Mr Obama warned the militants that they would be dealt with all the might of the US. So his new stance would not clarify the US position but confuse it. The Taliban spokesman immediately reacted negatively. He said his organisation is united and the US would not be able to divide it. He has also said that the time for any negotiations has passed. The spokesman said the US is economically weak and militarily it is not winning, as Mr Obama himself has admitted. In the circumstances, the Taliban would do its best to consolidate. So, as diplomacy goes, Mr Obama has not played his cards well.
If the US wanted a dialogue with the moderate Taliban in Afghanistan, then the Taliban in Pakistan could not be left out. In Afghanistan, the Karzai government could not be accused of being in league with the Taliban, but this cannot be said about the Pakistani government and also several political parties. The US has so far pampered these political parties and the military in Pakistan. From Zia-ul Haq to Pervez Musharraf — all the military dictators whom the US had trusted blindly — took the US for a ride. Things did not change even after civilian governments were installed.
It was Zia-ul Haq who gave full support to the Taliban and both Jimmy Carter and his national security adviser, Zbigniew Brzezinski, held views that Taliban was preferable to the Soviet-supported Afghanistani communists. Thus, strengthened, the Taliban went on gaining more strength. Pakistani governments always protected and helped the Taliban, which was useful to them to cow down the Afghan government and undermine its authority. It also trained insurgents to be sent to Kashmir.
For some time, a few commentators in the US have been canvassing for a change in the attitude and policy of the US government with regard to Pakistan and Afghanistan. They are mainly concerned with Pakistan. Their contention is that the US should give massive aid to Pakistan to build infrastructure, schools and hospitals. They, of course, want the US to hold the Pakistani authorities accountable. They also proposed that Pakistan be treated on equal footing with India and, as the US has entered into a nuclear deal with India, the same should be offered to Pakistan.
These advocates conveniently forget that part of the massive aid which was given to Pakistan after 9/11 was diverted to budgetary needs and 80 per cent of the military equipment purchased was to be used against India and not the militants. So, if now the Taliban has become powerful in Pakistan, then the responsibility lies equally with Pakistan and the US. Now the defence secretary warns against the Talibanisation of Pakistan, but he is in a hopeless position.
As of now, the government of Pakistan has conceded power to the Taliban in Swat Valley. The Zardari government explained that it did its best to contain the Taliban, but failed. So it had no other option than to concede. The Taliban has implemented Sharia law in the Swat Valley. In fact, NWFP has already started implementing it in the province's Malakand district. The NWFP is governed by the Awami National Party and, according to the Economist, the Pakistani tourism ministry had started hundreds of radical madrasas across the province. This ministry is held by an Islamist party.
Thus, whatever has happened in the Swat Valley has happened with the full consent of the Zardari government. It is also curious that the reactions of both the US government and that of British Prime Minister Gordon Brown to the takeover of Swat and Malakand district by Taliban were mild. This might be a precursor to the conciliatory policy to be adopted by Mr Obama and Mr Brown. It would not come as a surprise if the Taliban controls the entire NWFP in the days to come.
Those who are pleading Pakistan's case also want to differentiate between the radical or bloodthirsty Taliban and its moderate elements. It is said that the Taliban and Al Qaeda are not the same. The former did not attack and kill Americans and has not waged war against the West like the Al Qaeda, and so the Taliban should not be bundled together with Al Qaeda. But right from the beginning, Mullah Omar, who is supposed to be a founder of the Taliban, not only joined hands with Osama bin Laden but willingly accepted a subordinate role to the Saudi. Moreover, the Taliban, in league with Al Qaeda, carried out numerous attacks and raids.
There are 25 million Pashtuns in Pakistan and 15 million in Afghanistan and they are the mainstay of the Taliban. Pakistan's politicians have used them to constantly foment trouble in the neighbouring state. Mr Musharraf openly advocated the theory of strategic depth, which means control of Afghanistan.
As Pakistan would not mind adjoining territory falling into the hands of the Taliban so long as it does not indulge in insurgency in their state, so also the US is advised to look the other way and not go after the Taliban. It might one day be advocated that the Al Qaeda should be isolated and the Taliban placated as Mao Zedong was courted and not the Soviet Union.
If a placated Taliban starts more training camps for militants and sends more insurgents into Kashmir, and decides to attack more industrial cities in India, the US would not mind or, as they say, it would consider how to cross the bridge when it comes to it.
Therefore, India has to fortify itself and be aware that neither the US nor any other country will fight India's battle against terrorism.
Indeed, we should be prepared to face a period of more terrorist attacks in the event of any understanding with the Taliban.
http://www.asianage.com/presentation/leftnavigation/opinion/opinion/obama's-softening-on-taliban-is-a-danger.aspx
March.17 : A few weeks ago US President Barack Obama announced that he would send 17,000 more troops to Afghanistan and also appealed to the Nato allies to increase their military strength in Afghanistan. Nobody is sure whether this appeal would be heeded by the allies.
At the same time, in an interview to the New York Times, Mr Obama said that the possibility of having some dialogue with the "moderate" Taliban would be explored by the US.
He is aware of the complexity of the problem, but he said that as was done in Iraq, the moderate elements in Afghanistan would also be contacted. If this is so, then why should the allies increase the number of troops deployed?
In his campaign speeches, and also at the time of his inauguration, Mr Obama warned the militants that they would be dealt with all the might of the US. So his new stance would not clarify the US position but confuse it. The Taliban spokesman immediately reacted negatively. He said his organisation is united and the US would not be able to divide it. He has also said that the time for any negotiations has passed. The spokesman said the US is economically weak and militarily it is not winning, as Mr Obama himself has admitted. In the circumstances, the Taliban would do its best to consolidate. So, as diplomacy goes, Mr Obama has not played his cards well.
If the US wanted a dialogue with the moderate Taliban in Afghanistan, then the Taliban in Pakistan could not be left out. In Afghanistan, the Karzai government could not be accused of being in league with the Taliban, but this cannot be said about the Pakistani government and also several political parties. The US has so far pampered these political parties and the military in Pakistan. From Zia-ul Haq to Pervez Musharraf — all the military dictators whom the US had trusted blindly — took the US for a ride. Things did not change even after civilian governments were installed.
It was Zia-ul Haq who gave full support to the Taliban and both Jimmy Carter and his national security adviser, Zbigniew Brzezinski, held views that Taliban was preferable to the Soviet-supported Afghanistani communists. Thus, strengthened, the Taliban went on gaining more strength. Pakistani governments always protected and helped the Taliban, which was useful to them to cow down the Afghan government and undermine its authority. It also trained insurgents to be sent to Kashmir.
For some time, a few commentators in the US have been canvassing for a change in the attitude and policy of the US government with regard to Pakistan and Afghanistan. They are mainly concerned with Pakistan. Their contention is that the US should give massive aid to Pakistan to build infrastructure, schools and hospitals. They, of course, want the US to hold the Pakistani authorities accountable. They also proposed that Pakistan be treated on equal footing with India and, as the US has entered into a nuclear deal with India, the same should be offered to Pakistan.
These advocates conveniently forget that part of the massive aid which was given to Pakistan after 9/11 was diverted to budgetary needs and 80 per cent of the military equipment purchased was to be used against India and not the militants. So, if now the Taliban has become powerful in Pakistan, then the responsibility lies equally with Pakistan and the US. Now the defence secretary warns against the Talibanisation of Pakistan, but he is in a hopeless position.
As of now, the government of Pakistan has conceded power to the Taliban in Swat Valley. The Zardari government explained that it did its best to contain the Taliban, but failed. So it had no other option than to concede. The Taliban has implemented Sharia law in the Swat Valley. In fact, NWFP has already started implementing it in the province's Malakand district. The NWFP is governed by the Awami National Party and, according to the Economist, the Pakistani tourism ministry had started hundreds of radical madrasas across the province. This ministry is held by an Islamist party.
Thus, whatever has happened in the Swat Valley has happened with the full consent of the Zardari government. It is also curious that the reactions of both the US government and that of British Prime Minister Gordon Brown to the takeover of Swat and Malakand district by Taliban were mild. This might be a precursor to the conciliatory policy to be adopted by Mr Obama and Mr Brown. It would not come as a surprise if the Taliban controls the entire NWFP in the days to come.
Those who are pleading Pakistan's case also want to differentiate between the radical or bloodthirsty Taliban and its moderate elements. It is said that the Taliban and Al Qaeda are not the same. The former did not attack and kill Americans and has not waged war against the West like the Al Qaeda, and so the Taliban should not be bundled together with Al Qaeda. But right from the beginning, Mullah Omar, who is supposed to be a founder of the Taliban, not only joined hands with Osama bin Laden but willingly accepted a subordinate role to the Saudi. Moreover, the Taliban, in league with Al Qaeda, carried out numerous attacks and raids.
There are 25 million Pashtuns in Pakistan and 15 million in Afghanistan and they are the mainstay of the Taliban. Pakistan's politicians have used them to constantly foment trouble in the neighbouring state. Mr Musharraf openly advocated the theory of strategic depth, which means control of Afghanistan.
As Pakistan would not mind adjoining territory falling into the hands of the Taliban so long as it does not indulge in insurgency in their state, so also the US is advised to look the other way and not go after the Taliban. It might one day be advocated that the Al Qaeda should be isolated and the Taliban placated as Mao Zedong was courted and not the Soviet Union.
If a placated Taliban starts more training camps for militants and sends more insurgents into Kashmir, and decides to attack more industrial cities in India, the US would not mind or, as they say, it would consider how to cross the bridge when it comes to it.
Therefore, India has to fortify itself and be aware that neither the US nor any other country will fight India's battle against terrorism.
Indeed, we should be prepared to face a period of more terrorist attacks in the event of any understanding with the Taliban.
BALOCHISTAN : Pak ISI and Taliban games
There is a belief as to the motive of the Pak ISI and a portion of the army that the Taliban is encouraged for the sake of strategic depth against India. This is a partial truth. There is another motive. To keep Baloch and Pashtun nationalism suppressed, since the Taliban strongly defines an indivisible Muslim Ummah and discourages national boundaries between Muslim nations. The same mind set made the Jamaat e islami of Bangladesh to collaborate with the Pak genocidal army during the war of of lebration of 1971. Sooner the Indian policy makers and world realise the better.
Prof. Kunal Ghosh
Prof. Kunal Ghosh
March 17, 2009
MADAGASCAR : Economic and Geopolitical Intrests
Some analysts point to the recent visit by the Chinese President, Hu Jintao; his country is involved in projects from iron ore to possibly arranging naval port facilities, and the island could factor into China's naval expansion strategy.
Mark Schroeder, at the global strategists Stratfor, added: "Madagascar has tremendous reserves of crude oil sands which have not yet been fully explored."
Independent , UK
Mark Schroeder, at the global strategists Stratfor, added: "Madagascar has tremendous reserves of crude oil sands which have not yet been fully explored."
Independent , UK
MEDVEDEV's Speech at an Expanded Session of the Defence Ministry board
Speech at an Expanded Session of the Defence Ministry board
March 17, 2009
PRESIDENT OF RUSSIA DMITRY MEDVEDEV: Comrade generals and admirals! Comrade officers!
Today the board is meeting in an extended format. Along with representatives of the Ministry of Defence, there are representatives of law enforcement agencies and leaders of the legislative and executive bodies.
A modern, well-trained army equipped with modern weapons is the key to our defence. It safeguards us against any potential threats or attempts to put pressure on our country, and is of course a fundamental condition for the successful development of Russia, the growth of our national economy and the welfare of our citizens. In light of the factors just mentioned, I would like to analyse the results of military activity over the past year and naturally I want to discuss priorities for the future.
2008 was a difficult year for our Armed Forces. The events in South Ossetia were a major test. The Russian army and Russian peacekeepers showed that they can defend the national interests of our country and protect people's lives.
I should also note that in the past year the Ministry of Defence has done a lot to strengthen the army and navy. More combat and operational training for our troops is now available. A number of large-scale exercises took place, during which new challenges featured prominently, along with capabilities of combat formations and units. Some of these exercises were unprecedented in modern history in terms of the number of troops involved.
The professional component of the Armed Forces has been strengthened and the length of service for conscripts has been reduced to one year.
Other indicators show that progress in general has been good. Incidentally I once again saw evidence of this at a meeting on 19 February with the heads of one of the largest military districts, the Siberian Military District.
Any analysis of the military and political situation in the world shows that in a number of regions serious potential for conflict remains. There is always the risk of local crises and international terrorism. Attempts to expand the North Atlantic Treaty Organisation on the borders of our country continue. All this requires a qualitative modernisation of our Armed Forces to give them a new, forward-looking perspective. Despite the current financial difficulties, we can make all the necessary provisions.
In this connection, I will focus on a number of priorities.
The first challenge is improving the combat readiness of our troops, not just regular improvement but a quantum leap, most importantly in our strategic nuclear forces. They must be unequivocally ready to meet all the challenges necessary to ensure the military security of our nation. What is also on the agenda is the transfer of all combat units and formations to the status of permanent readiness. I want to stress that this is a key component of the new model or new image of the Armed Forces.
The second challenge is optimising the structure and the headcount of the army. I want especially to stress that military planning must be based on the current situation and the nature of potential threats, and that long-term defence plans should be based on the Russia’s National Security Development Strategy through to 2020, which will soon be approved by the Security Council.
The third and most important challenge is to equip our troops with advanced weapons. Important sums have been spent on the development and procurement of these weapons, and despite the current financial problems the amounts spent are almost identical to those included in the earlier projected figures. In the past year we have transformed a whole range of combat units and formations by providing them with modern equipment, and in 2011 we will begin the large-scale rearmament of the army and navy.
Fourth, we need further improvement in military education: the network of military educational institutions must be brought into line with the real demand for officers. Military institutions as well as civil institutions should of course be actively involved in modernising the system of higher education in our country and in the process of integrating education, science and industry in order to prepare highly qualified staff that are capable of creating new technologies.
Another objective or absolute top priority of our work is resolving the social problems of servicemen. In recent years, the state has paid a great deal of attention to enhancing their social status. Since 2000, the funds set aside for this have increased more than tenfold. During the same period the pensions of those who retire from the military have significantly increased. We have worked continuously on one of the most critical problems that exist in the army, namely the housing problem. In 2008 alone the Ministry of Defence has made more than 22.5 thousand apartments available as permanent housing for troops; in 2009 the Ministry of Defence is planning to purchase more than 40 thousand apartments.
Since October 2008 the amount of monetary compensation for renting accommodation has significantly increased. Nevertheless, it does not yet fully cover the costs of military personnel who rent housing. This topic should be addressed.
There is now a funded mortgage system for servicemen. The indexation of allowance will be continued if economic growth permits, and we will build new housing at the rates that I just mentioned and improve our military towns.
And, finally, we need to show more responsibility and pay more attention to the problems of social adaptation for officers who retire from the Armed Forces and to the issues of their retraining and ongoing employment. In addressing this issue The Ministry of Defence should work closely with other agencies and with representatives of the business community and regional authorities.
In conclusion, I would like to stress once again that a lot will have to be done in order to give our Armed Forces a new image. For it to succeed we need the commanders at every level to be highly competent; equally necessary are the co-ordination of our joint actions and – of course most importantly – public support for reforms in the army. In this regard, it is necessary to explain more actively the purpose and meaning of the transformations that are currently underway. The leaders of the Armed Forces and representatives of federal and regional authorities should all be involved in this work.
Let me thank you for your service and wish you all sorts of new successes.
***
At the end of the first part of the Defence Ministry board I have literally just a couple of things to say.
Of course, last year was really very difficult for our country, and this year has not been easy for obvious economic reasons.
Returning to the problems that arose in the Caucasus: the conflict in South Ossetia is clearly a reason for the sort of serious discussion and analysis that has already been conducted and has led to certain conclusions.
In my opening remarks I said that our Armed Forces and our peacekeepers have shown themselves in the best light. This is true and there should be no doubts whatever on this score. But of course this conflict also revealed our weaknesses. They are well known to everyone in the room. I won’t go on and on about them, but obviously the problems associated with certain types of weapons and with communications during the relevant operations are well known and require an immediate response.
I said that many kinds of exercises have been held for the first time in recent years and some of them for the first time in the history of the Russian Armed Forces. That said, we have to recognise that we have to perform more such exercises. I think that we will continue to expand whatever opportunities we have in this area, and of course conduct them effectively, because only during such exercises can you hone your combat skills, and we must not begrudge money for this.
Another ongoing concern about which the Minister of Defence spoke is the creation of the Collective Rapid Reaction Force of the CSTO [The Collective Security Treaty Organisation]. As you know, this decision was made by us and other CSTO member states. This must be an up-to-date force, equipped with the latest models of military equipment, with their own uniforms. In general, it must be made up of units that we can use to deal with our most serious problems, for example, a terrorist attack, or to defend against other possible military threats. This is where we can test some of the latest technology.
Concerning the procurement of weapons, I spoke about this at the outset and the Minister of Defence has just done so as well. In fact the pace of these acquisitions has recently increased. Yet it must be admitted that we need to acquire more for the Armed Forces, in both quantitative and qualitative terms.
Another subject that I have already touched on is that we have to stop repairing equipment and should start buying it new. While in a previous era, when we had lesser capabilities and other problems, repairing equipment was more or less explicable, nowadays during a crisis, that is at a time when part of our military production is shut down, when enterprises in our defence industry aren’t working to full capacity, repairing equipment is unacceptable. We need to buy new equipment.
Another subject that was mentioned and I would particularly like you to focus on is of course the transition of units to the state of permanent combat readiness. This is an important and very difficult task that has never been addressed by our Armed Forces. Of course it will take some time and a very important concentration of efforts. It will require everyone’s efforts, not only those of the Ministry of Defence, but also those of the civil authorities who are required to carry out this task according to the decision made.
Concerning social questions: in fact, this is one of our most important priorities. And everything that has been done recently is no doubt is a step in the right direction, but it is still not enough. We must confront this challenge and provide permanent housing by 2010 and service accomodation by 2012. And even faced with a financial crisis, we can meet this challenge.
Dear Comrades! The challenges faced by our Armed Forces are greater than they have ever been. And at the same time we must acknowledge that we have everything we need to meet them. Let me repeat: despite the difficult financial circumstances which our country and other nations currently face, in the whole modern history of Russia we have never had such favourable conditions for creating modern and efficient Armed Forces.
I would like to thank you again and to wish you success in this task. We will work hard together.
March 17, 2009
PRESIDENT OF RUSSIA DMITRY MEDVEDEV: Comrade generals and admirals! Comrade officers!
Today the board is meeting in an extended format. Along with representatives of the Ministry of Defence, there are representatives of law enforcement agencies and leaders of the legislative and executive bodies.
A modern, well-trained army equipped with modern weapons is the key to our defence. It safeguards us against any potential threats or attempts to put pressure on our country, and is of course a fundamental condition for the successful development of Russia, the growth of our national economy and the welfare of our citizens. In light of the factors just mentioned, I would like to analyse the results of military activity over the past year and naturally I want to discuss priorities for the future.
2008 was a difficult year for our Armed Forces. The events in South Ossetia were a major test. The Russian army and Russian peacekeepers showed that they can defend the national interests of our country and protect people's lives.
I should also note that in the past year the Ministry of Defence has done a lot to strengthen the army and navy. More combat and operational training for our troops is now available. A number of large-scale exercises took place, during which new challenges featured prominently, along with capabilities of combat formations and units. Some of these exercises were unprecedented in modern history in terms of the number of troops involved.
The professional component of the Armed Forces has been strengthened and the length of service for conscripts has been reduced to one year.
Other indicators show that progress in general has been good. Incidentally I once again saw evidence of this at a meeting on 19 February with the heads of one of the largest military districts, the Siberian Military District.
Any analysis of the military and political situation in the world shows that in a number of regions serious potential for conflict remains. There is always the risk of local crises and international terrorism. Attempts to expand the North Atlantic Treaty Organisation on the borders of our country continue. All this requires a qualitative modernisation of our Armed Forces to give them a new, forward-looking perspective. Despite the current financial difficulties, we can make all the necessary provisions.
In this connection, I will focus on a number of priorities.
The first challenge is improving the combat readiness of our troops, not just regular improvement but a quantum leap, most importantly in our strategic nuclear forces. They must be unequivocally ready to meet all the challenges necessary to ensure the military security of our nation. What is also on the agenda is the transfer of all combat units and formations to the status of permanent readiness. I want to stress that this is a key component of the new model or new image of the Armed Forces.
The second challenge is optimising the structure and the headcount of the army. I want especially to stress that military planning must be based on the current situation and the nature of potential threats, and that long-term defence plans should be based on the Russia’s National Security Development Strategy through to 2020, which will soon be approved by the Security Council.
The third and most important challenge is to equip our troops with advanced weapons. Important sums have been spent on the development and procurement of these weapons, and despite the current financial problems the amounts spent are almost identical to those included in the earlier projected figures. In the past year we have transformed a whole range of combat units and formations by providing them with modern equipment, and in 2011 we will begin the large-scale rearmament of the army and navy.
Fourth, we need further improvement in military education: the network of military educational institutions must be brought into line with the real demand for officers. Military institutions as well as civil institutions should of course be actively involved in modernising the system of higher education in our country and in the process of integrating education, science and industry in order to prepare highly qualified staff that are capable of creating new technologies.
Another objective or absolute top priority of our work is resolving the social problems of servicemen. In recent years, the state has paid a great deal of attention to enhancing their social status. Since 2000, the funds set aside for this have increased more than tenfold. During the same period the pensions of those who retire from the military have significantly increased. We have worked continuously on one of the most critical problems that exist in the army, namely the housing problem. In 2008 alone the Ministry of Defence has made more than 22.5 thousand apartments available as permanent housing for troops; in 2009 the Ministry of Defence is planning to purchase more than 40 thousand apartments.
Since October 2008 the amount of monetary compensation for renting accommodation has significantly increased. Nevertheless, it does not yet fully cover the costs of military personnel who rent housing. This topic should be addressed.
There is now a funded mortgage system for servicemen. The indexation of allowance will be continued if economic growth permits, and we will build new housing at the rates that I just mentioned and improve our military towns.
And, finally, we need to show more responsibility and pay more attention to the problems of social adaptation for officers who retire from the Armed Forces and to the issues of their retraining and ongoing employment. In addressing this issue The Ministry of Defence should work closely with other agencies and with representatives of the business community and regional authorities.
In conclusion, I would like to stress once again that a lot will have to be done in order to give our Armed Forces a new image. For it to succeed we need the commanders at every level to be highly competent; equally necessary are the co-ordination of our joint actions and – of course most importantly – public support for reforms in the army. In this regard, it is necessary to explain more actively the purpose and meaning of the transformations that are currently underway. The leaders of the Armed Forces and representatives of federal and regional authorities should all be involved in this work.
Let me thank you for your service and wish you all sorts of new successes.
***
At the end of the first part of the Defence Ministry board I have literally just a couple of things to say.
Of course, last year was really very difficult for our country, and this year has not been easy for obvious economic reasons.
Returning to the problems that arose in the Caucasus: the conflict in South Ossetia is clearly a reason for the sort of serious discussion and analysis that has already been conducted and has led to certain conclusions.
In my opening remarks I said that our Armed Forces and our peacekeepers have shown themselves in the best light. This is true and there should be no doubts whatever on this score. But of course this conflict also revealed our weaknesses. They are well known to everyone in the room. I won’t go on and on about them, but obviously the problems associated with certain types of weapons and with communications during the relevant operations are well known and require an immediate response.
I said that many kinds of exercises have been held for the first time in recent years and some of them for the first time in the history of the Russian Armed Forces. That said, we have to recognise that we have to perform more such exercises. I think that we will continue to expand whatever opportunities we have in this area, and of course conduct them effectively, because only during such exercises can you hone your combat skills, and we must not begrudge money for this.
Another ongoing concern about which the Minister of Defence spoke is the creation of the Collective Rapid Reaction Force of the CSTO [The Collective Security Treaty Organisation]. As you know, this decision was made by us and other CSTO member states. This must be an up-to-date force, equipped with the latest models of military equipment, with their own uniforms. In general, it must be made up of units that we can use to deal with our most serious problems, for example, a terrorist attack, or to defend against other possible military threats. This is where we can test some of the latest technology.
Concerning the procurement of weapons, I spoke about this at the outset and the Minister of Defence has just done so as well. In fact the pace of these acquisitions has recently increased. Yet it must be admitted that we need to acquire more for the Armed Forces, in both quantitative and qualitative terms.
Another subject that I have already touched on is that we have to stop repairing equipment and should start buying it new. While in a previous era, when we had lesser capabilities and other problems, repairing equipment was more or less explicable, nowadays during a crisis, that is at a time when part of our military production is shut down, when enterprises in our defence industry aren’t working to full capacity, repairing equipment is unacceptable. We need to buy new equipment.
Another subject that was mentioned and I would particularly like you to focus on is of course the transition of units to the state of permanent combat readiness. This is an important and very difficult task that has never been addressed by our Armed Forces. Of course it will take some time and a very important concentration of efforts. It will require everyone’s efforts, not only those of the Ministry of Defence, but also those of the civil authorities who are required to carry out this task according to the decision made.
Concerning social questions: in fact, this is one of our most important priorities. And everything that has been done recently is no doubt is a step in the right direction, but it is still not enough. We must confront this challenge and provide permanent housing by 2010 and service accomodation by 2012. And even faced with a financial crisis, we can meet this challenge.
Dear Comrades! The challenges faced by our Armed Forces are greater than they have ever been. And at the same time we must acknowledge that we have everything we need to meet them. Let me repeat: despite the difficult financial circumstances which our country and other nations currently face, in the whole modern history of Russia we have never had such favourable conditions for creating modern and efficient Armed Forces.
I would like to thank you again and to wish you success in this task. We will work hard together.
Climb-Down By Zardari: Future Implications
By B. Raman
In an apparent last-minute, late-night climb-down, President Asif Ali Zardari of Pakistan agreed on March 16, 2009, to reinstate as the Chief Justice of the Pakistan Supreme Court Iftikhar Muhammed Chaudhury who was twice removed from office by the then President Pervez Musharraf in March and November, 2007. His reinstatement will take effect after the present Pervez Musharraf-appointed Chief Justice Abdul Hameed Dogar reaches the age of superannuation on March 21, 2009.
2. There were earlier reports that Zardari was contemplating to give Dogar an extension.The unprecedented support for Iftikhar Muhammed Chaudhury not only from the community of lawyers, but also from large sections of the people mobilized by the Pakistan Muslim League (Nawaz), has forced him to accept the demand for his reinstatement. Pressure from the Army and the US to avoid a violent street confrontation on the issue has also forced his climb-down.
3. The events leading to this climb-down would strengthen the misgivings not only in Pakistan, but also in the US about Zardari’s leadership qualities. He brought this humiliation upon himself by his ill-advised attempts to undermine the political position of Nawaz, his brother Shahbaz Sharif and their PML (N) in Punjab. For this purpose, he allegedly manipulated a ruling by a bench of the Supreme Court consisting of judges appointed by Musharraf disqualifying Nawaz and Shahbaz from holding any elected office. The bench gave the ruling on the ground that Nawaz was a convict in a case filed against him by Musharraf after seizing power in October, 1999, and that Shahbaz was a co-accused in a case relating to the death of a person at the hands of the police when he was the Chief Minister of Punjab before the 1999 coup.
4. Allegedly acting on the wrong advice of his cronies, Zardari tried to take advantage of the ruling to have the PML (N) removed from power in Punjab and to have an engineered coalition consisting of his Pakistan People’s Party (PPP) and the PML (Qaide Azam) created by Musharraf in 2002 to defeat the PPP and the PML (N) inducted into power. His attempts, made through Salman Tasheer, the Governor of Punjab, who is a crony of Zardari as well as Musharraf, boomeranged.
5. The fresh agitation by the lawyers for the reinstatement of Chaudhury, the date for which had been announced by them long before the events in Punjab, might not have assumed the dimensions of a people’s revolt against Zardari but for his failed attempt to capture power for his party in the Punjab through engineered defections from the ranks of the PML (N) and back room manipulations with the complicity of some sections of the Musharraf-appointed judiciary.
6. The last elections to the National Assembly held in February, 2008, two months after the assassination of Benazir Bhutto, surprisingly showed that the sympathy wave for her was confined to the rural constituencies of Sindh. The PPP failed to do well even in its traditional support bases in southern Punjab, largely inhabited by the Seraikis. The sympathy wave in Punjab was more for Nawaz because of the way he was sought to be humiliated by Musharraf after the coup. The PML (N) won many more seats in Punjab than the PPP. Even the Rawalpindi area, where Benazir was assassinated, voted for the PML (N).
7. The resulting polarization between Sindh, dominated by Altaf Hussain’s Muttahida Qaumi Movement (MQM) and the PPP, and Punjab dominated by the PML (N), set in motion the train of events which ultimately led to the humiliation of Zardari. The action of Zardari in going back on his pre-election commitments made to the PML (N) in matters relating to the reinstatement of the sacked Chief Justice and abolishing, through a constitutional amendment, the powers of the President to dismiss an elected Prime Minister and dissolve the National Assembly exacerbated his personal differences with Nawaz.
8. The old Bhutto loyalists in the PPP, including Yousef Raza Gilani, the Prime Minister, who is a Seraiki, were uncomfortable about the erratic decisions of Zardari on the advice of a small coterie of persons such as Rehman Malik, the Adviser for Internal Security, Salman Taseer and Farook H.Naek, his former lawyer in the corruption cases, whom Zardari made the Minister for Law and then had him elected as the Chairman of the Senate, the upper House of Parliament. The Bhutto loyalists were shocked by his action in choosing Naek for election as the Senate Chairman, overlooking the claims of Raza Rabbani, an old Bhutto loyalist, who was held in great respect in the party. Rabbani resigned in protest from his post of Minister For Inter-Provincial Co-ordination.
9. The people’s uprising on the issue of the reinstatement of the sacked Chief Justice and the growing discontent in his own Party over the way he sought to marginalize old Bhutto loyalists created a situation, where he found himself isolated. The erosion of whatever little support he had in his party and in the country as a whole and the growing unease in the Army and the US over the implications of his policies and actions for the stability of Pakistan and the fight against terrorism created a situation where his humiliating climb-down became inevitable.
10. Unfortunately, Zardari is not known to be a man who learns from his mistakes. He tends to repeat them. Comments by persons close to him show that he and his cronies look upon the concessions made by him not as a climb-down, but as a tactical retreat to avoid a street confrontation, which might have triggered off an intervention by the Army. While he may have no other option but to restore the PML (N) to power in Punjab, he is likely to resist the demand of the PML (N) and others for a constitutional amendment to abolish his powers to dismiss the Prime Minister and dissolve the National Assembly. As he did in the past, he would create an impression as if he is keen to abolish these powers, but is prevented from doing so by the lack of two-thirds support for a constitutional amendment in the National Assembly. What one saw on March 16 was only the end of Act I of the political drama in Pakistan. Act II could start over the issue of the abolition of the special powers of the President.
11. Pakistan is in for a spell of weak and manipulative leadership by a leader without much public support, but trying to survive through political manipulations. This will aggravate the already serious security vacuum in the country and give fresh oxygen to the various terrorist groups operating from the Pakistani territory. At a time when the Barack Obama administration is embarked on formulating a new strategy to end the political and security vacuum in Afghanistan, it is faced with the danger of a similar vacuum in Pakistan.
12. If Pakistani public opinion has to have a say as to who should be its ruler, its choice will be on Nawaz Sharif. After having seen the huge mess created by Zardari within six months of taking over as the President, the Army too would prefer Nawaz despite his attempts in October, 1999, to humiliate Pervez Musharraf, his Chief of the Army Staff, by dismissing him while he was abroad and unsuccessfully trying to prevent his return.
13. US thinking will have a say in influencing the Army’s position. Zardari has given the US a free hand in the tribal belt to attack terrorist hide-outs with its fleet of Predator aircraft. Zardari is amenable to US advice on the fight against terrorism. There have even been reports that he and Gen.Ashfaq Pervez Kiyani, his Chief of the Army Staff, have allowed the Central Intelligence Agency, to use bases of the Pakistan Air Force for launching the Predator strikes.
14. It is very likely that if Nawaz comes to power, he may not be as amenable to US requirements as Zardari has been. On more than one occasion, Nawaz has expressed the view that the present terms of the co-operation with the US need to be reconsidered without weakening the over-all fight against Al Qaeda. Zardari owes a huge debt to the US for persuading Musharraf to issue the National Reconciliation Ordinance (NRO) under which the pending cases against him and his wife were withdrawn.
15. Nawaz owes no such debt to the US. He is likely to be more independent and less accommodating with the US. Would the US continue to facilitate the continuance of Zardari in power because he is willing to do its bidding or will it remove itself from the way of Nawaz coming to power, realizing that a stronger and more popular ruler would help US interests strategically than a weak and unpopular ruler who could prove to be detrimental to US interests tactically as well as strategically?
12. On the answers to this question would depend what happens under Act II of the Pakistani drama. A dark horse will be Prime Minister Gilani, who has emerged with an enhanced image from the present crisis by virtue of his having distanced himself from the decisions of Zardari relating to Punjab. If Gilani has to be built up into a more assertive ruler, the special powers of the President have to be abolished. This can be done only if the PML (N) and the Bhutto loyalists in the PPP join hands. The prospects of this happening are rather low now.
13. Pakistani co-operation with India in the investigation of the 26/11 terrorist strikes in Mumbai and in acting against the anti-India terrorist infrastructure in Pakistani territory will be even more uncertain than it has been hitherto. More terrorism against India by groups taking advantage of the huge mess and political and security vacuum in Pakistan is a distinct danger.
(The writer is Additional Secretary (retd), Cabinet Secretariat, Govt. of India, New Delhi, and, presently, Director, Institute For Topical Studies, Chennai. E-mail: seventyone2@gmail.com)
In an apparent last-minute, late-night climb-down, President Asif Ali Zardari of Pakistan agreed on March 16, 2009, to reinstate as the Chief Justice of the Pakistan Supreme Court Iftikhar Muhammed Chaudhury who was twice removed from office by the then President Pervez Musharraf in March and November, 2007. His reinstatement will take effect after the present Pervez Musharraf-appointed Chief Justice Abdul Hameed Dogar reaches the age of superannuation on March 21, 2009.
2. There were earlier reports that Zardari was contemplating to give Dogar an extension.The unprecedented support for Iftikhar Muhammed Chaudhury not only from the community of lawyers, but also from large sections of the people mobilized by the Pakistan Muslim League (Nawaz), has forced him to accept the demand for his reinstatement. Pressure from the Army and the US to avoid a violent street confrontation on the issue has also forced his climb-down.
3. The events leading to this climb-down would strengthen the misgivings not only in Pakistan, but also in the US about Zardari’s leadership qualities. He brought this humiliation upon himself by his ill-advised attempts to undermine the political position of Nawaz, his brother Shahbaz Sharif and their PML (N) in Punjab. For this purpose, he allegedly manipulated a ruling by a bench of the Supreme Court consisting of judges appointed by Musharraf disqualifying Nawaz and Shahbaz from holding any elected office. The bench gave the ruling on the ground that Nawaz was a convict in a case filed against him by Musharraf after seizing power in October, 1999, and that Shahbaz was a co-accused in a case relating to the death of a person at the hands of the police when he was the Chief Minister of Punjab before the 1999 coup.
4. Allegedly acting on the wrong advice of his cronies, Zardari tried to take advantage of the ruling to have the PML (N) removed from power in Punjab and to have an engineered coalition consisting of his Pakistan People’s Party (PPP) and the PML (Qaide Azam) created by Musharraf in 2002 to defeat the PPP and the PML (N) inducted into power. His attempts, made through Salman Tasheer, the Governor of Punjab, who is a crony of Zardari as well as Musharraf, boomeranged.
5. The fresh agitation by the lawyers for the reinstatement of Chaudhury, the date for which had been announced by them long before the events in Punjab, might not have assumed the dimensions of a people’s revolt against Zardari but for his failed attempt to capture power for his party in the Punjab through engineered defections from the ranks of the PML (N) and back room manipulations with the complicity of some sections of the Musharraf-appointed judiciary.
6. The last elections to the National Assembly held in February, 2008, two months after the assassination of Benazir Bhutto, surprisingly showed that the sympathy wave for her was confined to the rural constituencies of Sindh. The PPP failed to do well even in its traditional support bases in southern Punjab, largely inhabited by the Seraikis. The sympathy wave in Punjab was more for Nawaz because of the way he was sought to be humiliated by Musharraf after the coup. The PML (N) won many more seats in Punjab than the PPP. Even the Rawalpindi area, where Benazir was assassinated, voted for the PML (N).
7. The resulting polarization between Sindh, dominated by Altaf Hussain’s Muttahida Qaumi Movement (MQM) and the PPP, and Punjab dominated by the PML (N), set in motion the train of events which ultimately led to the humiliation of Zardari. The action of Zardari in going back on his pre-election commitments made to the PML (N) in matters relating to the reinstatement of the sacked Chief Justice and abolishing, through a constitutional amendment, the powers of the President to dismiss an elected Prime Minister and dissolve the National Assembly exacerbated his personal differences with Nawaz.
8. The old Bhutto loyalists in the PPP, including Yousef Raza Gilani, the Prime Minister, who is a Seraiki, were uncomfortable about the erratic decisions of Zardari on the advice of a small coterie of persons such as Rehman Malik, the Adviser for Internal Security, Salman Taseer and Farook H.Naek, his former lawyer in the corruption cases, whom Zardari made the Minister for Law and then had him elected as the Chairman of the Senate, the upper House of Parliament. The Bhutto loyalists were shocked by his action in choosing Naek for election as the Senate Chairman, overlooking the claims of Raza Rabbani, an old Bhutto loyalist, who was held in great respect in the party. Rabbani resigned in protest from his post of Minister For Inter-Provincial Co-ordination.
9. The people’s uprising on the issue of the reinstatement of the sacked Chief Justice and the growing discontent in his own Party over the way he sought to marginalize old Bhutto loyalists created a situation, where he found himself isolated. The erosion of whatever little support he had in his party and in the country as a whole and the growing unease in the Army and the US over the implications of his policies and actions for the stability of Pakistan and the fight against terrorism created a situation where his humiliating climb-down became inevitable.
10. Unfortunately, Zardari is not known to be a man who learns from his mistakes. He tends to repeat them. Comments by persons close to him show that he and his cronies look upon the concessions made by him not as a climb-down, but as a tactical retreat to avoid a street confrontation, which might have triggered off an intervention by the Army. While he may have no other option but to restore the PML (N) to power in Punjab, he is likely to resist the demand of the PML (N) and others for a constitutional amendment to abolish his powers to dismiss the Prime Minister and dissolve the National Assembly. As he did in the past, he would create an impression as if he is keen to abolish these powers, but is prevented from doing so by the lack of two-thirds support for a constitutional amendment in the National Assembly. What one saw on March 16 was only the end of Act I of the political drama in Pakistan. Act II could start over the issue of the abolition of the special powers of the President.
11. Pakistan is in for a spell of weak and manipulative leadership by a leader without much public support, but trying to survive through political manipulations. This will aggravate the already serious security vacuum in the country and give fresh oxygen to the various terrorist groups operating from the Pakistani territory. At a time when the Barack Obama administration is embarked on formulating a new strategy to end the political and security vacuum in Afghanistan, it is faced with the danger of a similar vacuum in Pakistan.
12. If Pakistani public opinion has to have a say as to who should be its ruler, its choice will be on Nawaz Sharif. After having seen the huge mess created by Zardari within six months of taking over as the President, the Army too would prefer Nawaz despite his attempts in October, 1999, to humiliate Pervez Musharraf, his Chief of the Army Staff, by dismissing him while he was abroad and unsuccessfully trying to prevent his return.
13. US thinking will have a say in influencing the Army’s position. Zardari has given the US a free hand in the tribal belt to attack terrorist hide-outs with its fleet of Predator aircraft. Zardari is amenable to US advice on the fight against terrorism. There have even been reports that he and Gen.Ashfaq Pervez Kiyani, his Chief of the Army Staff, have allowed the Central Intelligence Agency, to use bases of the Pakistan Air Force for launching the Predator strikes.
14. It is very likely that if Nawaz comes to power, he may not be as amenable to US requirements as Zardari has been. On more than one occasion, Nawaz has expressed the view that the present terms of the co-operation with the US need to be reconsidered without weakening the over-all fight against Al Qaeda. Zardari owes a huge debt to the US for persuading Musharraf to issue the National Reconciliation Ordinance (NRO) under which the pending cases against him and his wife were withdrawn.
15. Nawaz owes no such debt to the US. He is likely to be more independent and less accommodating with the US. Would the US continue to facilitate the continuance of Zardari in power because he is willing to do its bidding or will it remove itself from the way of Nawaz coming to power, realizing that a stronger and more popular ruler would help US interests strategically than a weak and unpopular ruler who could prove to be detrimental to US interests tactically as well as strategically?
12. On the answers to this question would depend what happens under Act II of the Pakistani drama. A dark horse will be Prime Minister Gilani, who has emerged with an enhanced image from the present crisis by virtue of his having distanced himself from the decisions of Zardari relating to Punjab. If Gilani has to be built up into a more assertive ruler, the special powers of the President have to be abolished. This can be done only if the PML (N) and the Bhutto loyalists in the PPP join hands. The prospects of this happening are rather low now.
13. Pakistani co-operation with India in the investigation of the 26/11 terrorist strikes in Mumbai and in acting against the anti-India terrorist infrastructure in Pakistani territory will be even more uncertain than it has been hitherto. More terrorism against India by groups taking advantage of the huge mess and political and security vacuum in Pakistan is a distinct danger.
(The writer is Additional Secretary (retd), Cabinet Secretariat, Govt. of India, New Delhi, and, presently, Director, Institute For Topical Studies, Chennai. E-mail: seventyone2@gmail.com)
China & Dalai Lama: It is in China’s interest to Engage Dalai Lama in Meaningful Talks
China & Dalai Lama: It is in China’s interest to Engage Dalai Lama in Meaningful Talks
SOURCE : South Asia Analysis GroupGuest Column by Dr. B. R. Deepak
China recently declared that beginning from the year 2009, Tibet will celebrate March 28 as the “Serf Emancipation Day.” In fact, the resolution to this effect was unanimously passed by the Tibet Autonomous Region (TAR) People’s Congress Standing Committee on January 19, 2009.
The rationale behind such a move is that it was on March 28, 1959 that Zhou Enlai, the then Chinese Premier issued an order of the State Council, which dissolved the Tibetan government and its powers and functions were transferred to the Preparatory Committee of Autonomous Region of Tibet (PCART) in the aftermath of the March 10 uprising in Tibet and the subsequent flight of the Dalai Lama to India. The order read: “To safeguard the unification of the country and national unity, in addition to enjoining the Tibet Military Area Command of the Chinese People’s Liberation Army (PLA) to put down the rebellion thoroughly, it has been decided that as from today the Tibetan local government is dissolved and its functions and powers will be exercised by the Preparatory Committee for the Tibet Autonomous Region (Concerning the Question of Tibet 1959: 1).” The order further named 18 ‘traitors’, mostly the erstwhile Tibetan government officials and members of the PCART, dismissed them and appointed 16 new members in their place. Mass rallies were organized in Lhasa in support of the State Council order and given wide coverage by Xinhua.
It could be an internal affair of China, but one wonders it took half a century to declare March 28 as the “Serf-Emancipation Day” or the so called “Democratic Reform Day” as some other people call it in China? Why should not China celebrate October 24th as “Tibet Liberation Day”, the day Chamdo fell to the PLA, and the Governor General of Kham Ngabo captured? Ngabo was coincidently the main interlocutor of the Seventeen-point Agreement with China? It was after this defeat that the Tibetans capitulated, rushed to Beijing, and the ‘peaceful liberation’ of Tibet was achieved.
The answer to these questions is that it was on March 28, 1959 that China had a free hand in Tibet devoid of the Kashag, the Tibetan parliament, which till then formulated policies for Tibet.
The establishment of the PCART had already sounded a death knell to the ‘regional autonomy’, for out of 51 members of the PCART only 15 were headed by the Dalai Lama’s Tibetan Local Government (Union Research Institute 1968: 140-42).
Whether to mark the March 28 every year as a “Serf Emancipation Day” is a right move or not is a matter of debate. However, the move will certainly do the job of rubbing salt on many old wounds, which China and the international community is aware will do more harm than good. In the same vein, the demonising of the Dalai Lama by China, and pronouncing him as the mastermind of each and every upheaval in Tibet has not gone down well with the international community either, let alone the Tibetans.
Thanks to the reforms and opening up China has stopped blaming the ‘imperialists’ and ‘reactionaries’ for the trouble in Tibet. But the periodic crackdown, the show of force and the ‘patriotic education’ campaigns in monasteries across Tibet and other Tibetan inhabited prefectures are proving to be counter productive.
On the contrary, if “the situation in Tibet on the whole is stable, and the Tibetan people hope to live and work in peace and stability” as asserted by Premier Wen Jiabao after the conclusion of the annual session of the National People's Congress (NPC), China should then allow free flow of information from Tibet to the outside world and vice-versa, and let the outside world see for themselves what level of prosperity the Tibetans have been enjoying and to what extent the Tibetan people are enjoying the spiritual freedom that China has accorded to them under its constitution. If China does not subscribe to this, Tibet to the outside world would continue to be a zone of exclusion, and any propaganda true or false originating from China would not be heard by the international community, as has been the case so far.
It is true that the inhumane serfdom in Tibet, whereby, over 200 kinds of taxes levied by the Kashag, heavy corvées, at times 70 to 80 percent of serfs’ free labor to the Kashag or monastic estates, and usuries have been completely abolished and welcomed by many poor farmers in Tibet. If the figures released by the statistical bureau of the region are to be believed, the entire ethno-socio-political landscape of Tibet must have changed and the Tibetans must have benefitted immensely.
Statistics reveal that China subsidized Tibet with 95 billion yuan ($13 billion) in the past five years. In 2008, the region’s GDP reached 39.2 billion yuan ($ 5.8 billion), and its per capita GDP was 13,861 yuan. Tibet has made great progress in the infrastructure construction, highlighted by the completion of the Qinghai-Tibet railway and several highways. But the Tibetan émigrés ask who uses these roads and rail network, and who, how and at what cost the natural resources of Tibet are being exploited?
As regards the renovation of monasteries, the figures suggest that over the past two decades, China invested more than 700 million yuan ($100 million) in total in the preservation and maintenance of historical and cultural relics in Tibet. (China Daily April 14, 2008).
Figures apart, the flip side of the reforms and China’s largesse to Tibet suggest that ethnic contradictions in Tibet have sharpened and arisen from the demography, economy and politics of the Tibetan areas. Though Tibet has witnessed progress, it is the Han Chinese who dominates business, including the growth sectors – tourism and real estate. Since Chinese language is compulsory for getting a government job, most of the jobs are taken away by the Han Chinese. Politically, whether civilian or military, all top government positions are in the hands of Han Chinese, except a few titular ones. The Party Secretary has never been a Tibetan throughout the history of TAR.
It may be recalled that Han Chinese individuals and businesses were the main targets of the last year Lhasa riots. However, government establishments were also targeted. It has also been acknowledged by the Chinese government that forced relocation of Tibetan herders, affecting about 10 percent of the population since 2006, under the new housing scheme have separated them completely from their animals, their main source of income. The displacement has resulted in unemployment and has fueled the protests as they have spread beyond the monks. If we analyze the earlier protests, all were limited to Lhasa, but the March 2008 protests spread to other Tibetan inhabited areas in other provinces such as Qinghai, Gansu and Sichuan. The protests were not limited to the monks, but students, youths and herdsmen as well.
In the light of this -Mao’s famous speech “On the Correct Handling of Contradictions among the People” which he delivered on 27 February 1957 is worth mentioning. In his speech, Mao discussed 12 problems that almost touched on every point on the Chinese socio-political and economic situation.
The 11th problem Mao discussed was the problem of “National Minorities” and the great problem of Han chauvinism and the problem of the Tibet (MacFarquhar 1989: 184-85). Mao remarked, “China has several tens of millions of national minorities; the land that the national minorities occupy is some 50 or 60% [of all China]; their population is about 6% of China’s…the relations between Han and national minorities should be conducted well. This is principally the resolution of the Han chauvinism…We must certainly change this great Han chauvinism work style, ideas, sentiments, monopolizing matters that ought to be done by others [i.e. the minorities themselves], the disrespect for minorities.” Therefore, the social discontent in Tibet to some extent could be attributed to China’s (mis) handling of the issue and situation in Tibet. Why only Tibet, other places of the world have witnessed similar kinds of discontent arising out of ethno-socio-economic and political factors due to poor handling.
It is in China’s interests to engage the Dalai Lama in meaningful talks. Some Analysts have opined that the reluctance of China to hold meaningful talks with the Dalai Lama was also one of the reasons for last year’s Lhasa outburst. We know that eight rounds of talks have been held between the representatives of the Dalai Lama and China since 2002. Though the contents of the talks have been kept secret by both the sides, but it could be inferred that over the years China has hardened its stand towards the Dalai Lama; the Tibetans also appear to be sticking to their earlier demands; and the talks appear to have reached a dead end.
There are two points that are crucial and worth discussing. One, how can talks be meaningful when China is continuously demonizing and denouncing the Dalai Lama as a separatist undermining the unification of China? This has proved counter productive, as the Tibetans have been successful in garnering maximum support and sympathy in the western countries. China’s move to declare Tibetan Youth Congress as a terror outfit has further strengthened and internationalized the Tibetan movement to the disadvantage of China. China attaching conditions for talks has also convinced the international community that China is not sincere in holding talks with the Dalai Lama and thus resolving the Tibet issue.
Two, ‘genuine autonomy’ advocated by the Dalai lama stretching across all Tibetan inhabited areas in China, namely Qinghai, Sichuan, Gansu and Yunnan sounds impractical, for many of the areas of the ‘Greater Tibet’ have been under the Chinese jurisdiction for hundreds of years. The Dalai Lama and his negotiators need to take a leaf from history, especially the Simla conference of 1914. When the British proposed to divide Tibet into inner and outer Tibet and demanded more territories, which the Dalai Lama’s negotiators are seeking today, China refused. The Chinese disagreed with these proposals, primarily due to the territorial claims made by Tibet in Kham and Amdo. Therefore, when the British, the most powerful country at that time could not secure large tracts inhabited by the Tibetans from the Warlord government of Yuan Shikai, the weakest of all the Chinese governments, the autonomy for a greater Tibet from a stronger China is almost impossible. To reach a win-win situation both China and the Dalai Lama need to look for a middle ground that is acceptable to both the parties. If one thinks that the Tibet issue would die with the demise of the Dalai Lama, it would be a mistake. Moreover, procrastination in diplomacy is a double edged sword.
References
Concerning the Question of Tibet (1959). Foreign Language Press, Peking.
MacFarquhar, Roderick, ed. (1989). The Secret Speeches of Chairman Mao: From the Hundred Flowers to the Great Leap Forward. Harvard Contemporary China Series 6. Cambridge, Mass.
Union Research Institute (1968). Tibet: 1950-1967. Union Research Institute, Hong Kong.
(The writer is Associate Professor of Chinese and Managing Editor THINK INDIA Quarterly - Centre of Chinese and Southeast Asian Studies, Jawaharlal Nehru University, New Delhi, India 110067. He can be reached at deepak110@yahoo.com)
SOURCE : South Asia Analysis GroupGuest Column by Dr. B. R. Deepak
China recently declared that beginning from the year 2009, Tibet will celebrate March 28 as the “Serf Emancipation Day.” In fact, the resolution to this effect was unanimously passed by the Tibet Autonomous Region (TAR) People’s Congress Standing Committee on January 19, 2009.
The rationale behind such a move is that it was on March 28, 1959 that Zhou Enlai, the then Chinese Premier issued an order of the State Council, which dissolved the Tibetan government and its powers and functions were transferred to the Preparatory Committee of Autonomous Region of Tibet (PCART) in the aftermath of the March 10 uprising in Tibet and the subsequent flight of the Dalai Lama to India. The order read: “To safeguard the unification of the country and national unity, in addition to enjoining the Tibet Military Area Command of the Chinese People’s Liberation Army (PLA) to put down the rebellion thoroughly, it has been decided that as from today the Tibetan local government is dissolved and its functions and powers will be exercised by the Preparatory Committee for the Tibet Autonomous Region (Concerning the Question of Tibet 1959: 1).” The order further named 18 ‘traitors’, mostly the erstwhile Tibetan government officials and members of the PCART, dismissed them and appointed 16 new members in their place. Mass rallies were organized in Lhasa in support of the State Council order and given wide coverage by Xinhua.
It could be an internal affair of China, but one wonders it took half a century to declare March 28 as the “Serf-Emancipation Day” or the so called “Democratic Reform Day” as some other people call it in China? Why should not China celebrate October 24th as “Tibet Liberation Day”, the day Chamdo fell to the PLA, and the Governor General of Kham Ngabo captured? Ngabo was coincidently the main interlocutor of the Seventeen-point Agreement with China? It was after this defeat that the Tibetans capitulated, rushed to Beijing, and the ‘peaceful liberation’ of Tibet was achieved.
The answer to these questions is that it was on March 28, 1959 that China had a free hand in Tibet devoid of the Kashag, the Tibetan parliament, which till then formulated policies for Tibet.
The establishment of the PCART had already sounded a death knell to the ‘regional autonomy’, for out of 51 members of the PCART only 15 were headed by the Dalai Lama’s Tibetan Local Government (Union Research Institute 1968: 140-42).
Whether to mark the March 28 every year as a “Serf Emancipation Day” is a right move or not is a matter of debate. However, the move will certainly do the job of rubbing salt on many old wounds, which China and the international community is aware will do more harm than good. In the same vein, the demonising of the Dalai Lama by China, and pronouncing him as the mastermind of each and every upheaval in Tibet has not gone down well with the international community either, let alone the Tibetans.
Thanks to the reforms and opening up China has stopped blaming the ‘imperialists’ and ‘reactionaries’ for the trouble in Tibet. But the periodic crackdown, the show of force and the ‘patriotic education’ campaigns in monasteries across Tibet and other Tibetan inhabited prefectures are proving to be counter productive.
On the contrary, if “the situation in Tibet on the whole is stable, and the Tibetan people hope to live and work in peace and stability” as asserted by Premier Wen Jiabao after the conclusion of the annual session of the National People's Congress (NPC), China should then allow free flow of information from Tibet to the outside world and vice-versa, and let the outside world see for themselves what level of prosperity the Tibetans have been enjoying and to what extent the Tibetan people are enjoying the spiritual freedom that China has accorded to them under its constitution. If China does not subscribe to this, Tibet to the outside world would continue to be a zone of exclusion, and any propaganda true or false originating from China would not be heard by the international community, as has been the case so far.
It is true that the inhumane serfdom in Tibet, whereby, over 200 kinds of taxes levied by the Kashag, heavy corvées, at times 70 to 80 percent of serfs’ free labor to the Kashag or monastic estates, and usuries have been completely abolished and welcomed by many poor farmers in Tibet. If the figures released by the statistical bureau of the region are to be believed, the entire ethno-socio-political landscape of Tibet must have changed and the Tibetans must have benefitted immensely.
Statistics reveal that China subsidized Tibet with 95 billion yuan ($13 billion) in the past five years. In 2008, the region’s GDP reached 39.2 billion yuan ($ 5.8 billion), and its per capita GDP was 13,861 yuan. Tibet has made great progress in the infrastructure construction, highlighted by the completion of the Qinghai-Tibet railway and several highways. But the Tibetan émigrés ask who uses these roads and rail network, and who, how and at what cost the natural resources of Tibet are being exploited?
As regards the renovation of monasteries, the figures suggest that over the past two decades, China invested more than 700 million yuan ($100 million) in total in the preservation and maintenance of historical and cultural relics in Tibet. (China Daily April 14, 2008).
Figures apart, the flip side of the reforms and China’s largesse to Tibet suggest that ethnic contradictions in Tibet have sharpened and arisen from the demography, economy and politics of the Tibetan areas. Though Tibet has witnessed progress, it is the Han Chinese who dominates business, including the growth sectors – tourism and real estate. Since Chinese language is compulsory for getting a government job, most of the jobs are taken away by the Han Chinese. Politically, whether civilian or military, all top government positions are in the hands of Han Chinese, except a few titular ones. The Party Secretary has never been a Tibetan throughout the history of TAR.
It may be recalled that Han Chinese individuals and businesses were the main targets of the last year Lhasa riots. However, government establishments were also targeted. It has also been acknowledged by the Chinese government that forced relocation of Tibetan herders, affecting about 10 percent of the population since 2006, under the new housing scheme have separated them completely from their animals, their main source of income. The displacement has resulted in unemployment and has fueled the protests as they have spread beyond the monks. If we analyze the earlier protests, all were limited to Lhasa, but the March 2008 protests spread to other Tibetan inhabited areas in other provinces such as Qinghai, Gansu and Sichuan. The protests were not limited to the monks, but students, youths and herdsmen as well.
In the light of this -Mao’s famous speech “On the Correct Handling of Contradictions among the People” which he delivered on 27 February 1957 is worth mentioning. In his speech, Mao discussed 12 problems that almost touched on every point on the Chinese socio-political and economic situation.
The 11th problem Mao discussed was the problem of “National Minorities” and the great problem of Han chauvinism and the problem of the Tibet (MacFarquhar 1989: 184-85). Mao remarked, “China has several tens of millions of national minorities; the land that the national minorities occupy is some 50 or 60% [of all China]; their population is about 6% of China’s…the relations between Han and national minorities should be conducted well. This is principally the resolution of the Han chauvinism…We must certainly change this great Han chauvinism work style, ideas, sentiments, monopolizing matters that ought to be done by others [i.e. the minorities themselves], the disrespect for minorities.” Therefore, the social discontent in Tibet to some extent could be attributed to China’s (mis) handling of the issue and situation in Tibet. Why only Tibet, other places of the world have witnessed similar kinds of discontent arising out of ethno-socio-economic and political factors due to poor handling.
It is in China’s interests to engage the Dalai Lama in meaningful talks. Some Analysts have opined that the reluctance of China to hold meaningful talks with the Dalai Lama was also one of the reasons for last year’s Lhasa outburst. We know that eight rounds of talks have been held between the representatives of the Dalai Lama and China since 2002. Though the contents of the talks have been kept secret by both the sides, but it could be inferred that over the years China has hardened its stand towards the Dalai Lama; the Tibetans also appear to be sticking to their earlier demands; and the talks appear to have reached a dead end.
There are two points that are crucial and worth discussing. One, how can talks be meaningful when China is continuously demonizing and denouncing the Dalai Lama as a separatist undermining the unification of China? This has proved counter productive, as the Tibetans have been successful in garnering maximum support and sympathy in the western countries. China’s move to declare Tibetan Youth Congress as a terror outfit has further strengthened and internationalized the Tibetan movement to the disadvantage of China. China attaching conditions for talks has also convinced the international community that China is not sincere in holding talks with the Dalai Lama and thus resolving the Tibet issue.
Two, ‘genuine autonomy’ advocated by the Dalai lama stretching across all Tibetan inhabited areas in China, namely Qinghai, Sichuan, Gansu and Yunnan sounds impractical, for many of the areas of the ‘Greater Tibet’ have been under the Chinese jurisdiction for hundreds of years. The Dalai Lama and his negotiators need to take a leaf from history, especially the Simla conference of 1914. When the British proposed to divide Tibet into inner and outer Tibet and demanded more territories, which the Dalai Lama’s negotiators are seeking today, China refused. The Chinese disagreed with these proposals, primarily due to the territorial claims made by Tibet in Kham and Amdo. Therefore, when the British, the most powerful country at that time could not secure large tracts inhabited by the Tibetans from the Warlord government of Yuan Shikai, the weakest of all the Chinese governments, the autonomy for a greater Tibet from a stronger China is almost impossible. To reach a win-win situation both China and the Dalai Lama need to look for a middle ground that is acceptable to both the parties. If one thinks that the Tibet issue would die with the demise of the Dalai Lama, it would be a mistake. Moreover, procrastination in diplomacy is a double edged sword.
References
Concerning the Question of Tibet (1959). Foreign Language Press, Peking.
MacFarquhar, Roderick, ed. (1989). The Secret Speeches of Chairman Mao: From the Hundred Flowers to the Great Leap Forward. Harvard Contemporary China Series 6. Cambridge, Mass.
Union Research Institute (1968). Tibet: 1950-1967. Union Research Institute, Hong Kong.
(The writer is Associate Professor of Chinese and Managing Editor THINK INDIA Quarterly - Centre of Chinese and Southeast Asian Studies, Jawaharlal Nehru University, New Delhi, India 110067. He can be reached at deepak110@yahoo.com)
Australia - Republic of Korea: New Security Arrangements
by Richard Tanter — last modified 12-Mar-2009 14:33
Richard Broinowski, Austral Policy Forum 09-6A, 13 March 2009
Introduction
Richard Broinowski of the University of Sydney notes that the Joint Statement on Enhanced Global and Security Cooperation between Australia and the Republic of Korea "provides for expanded practical defence cooperation in military information-sharing, peace-keeping, civil-military cooperation, joint exercises and training, and technical exchanges in defence industries". The difficulty, Broinowski argues, "is that, like Australia’s arrangements with Japan, it sends the wrong signals not to North Korea, but to China. Or rather, they are the right signals, but Korean and Australian politicians deny them. And these are that, led by the United States, the Republic of Korea, Australia and Japan are forging military arrangements to contain China. Upsetting China is in neither country’s interests. China has also demonstrated good citizenship and international responsibility in continuing to host the six party talks attempting to de-nuclearise North Korea. The present Australian government, as well as its conservative predecessor, would very much like a seat at that table."
Essay: Australia – Republic of Korea: New Security Arrangements
Before leaving Seoul for a State visit to Australia on 4 March, President Lee Myung-bak reportedly told the Foreign Editor of The Australian Greg Sheridan that he wanted a security agreement with Australia along the lines of the agreement Canberra has with Tokyo. The Japan-Australia agreement was negotiated in March 2007 between Prime Minister John Howard and Japanese Prime Minister Shinzo Abe. It fell short of a full-fledged security treaty because the Japanese government felt such a commitment would have violated the Japanese constitution. During Lee’s Australian visit, he and Prime Minister Rudd duly released a similar agreement. Called the Joint Statement on Enhanced Global and Security Cooperation this, like its Japanese counterpart, is a document of less than treaty status. Unsurprisingly, it provides for expanded practical defence cooperation in military information-sharing, peace-keeping, civil-military cooperation, joint exercises and training, and technical exchanges in defence industries. The Statement augments annual political and military talks which already occur between Canberra and Seoul. The first thing to note about this Joint Statement is its tentative nature. It is specifically non-binding, so that either side can withdraw from it gracefully if it finds its obligations are incompatible with its national interests.
The second is that many of the military ventures it envisages already take place, including ship visits and joint naval exercises, as well as exercises with the military forces of a larger group of participants such as Japan and the United States.
Third, although it talks about common interests in combating global ‘terror’ and participating in peace-keeping operations, it fails to acknowledge the discrepancies between the defence preoccupations of the two countries.
Since its foundation in 1948, the Republic of Korea has been concerned almost exclusively with the existential threat of another invasion from North Korea of the kind that led to the Korean War in 1950. Australia has never faced such a threat. The closest it came was when Japanese forces occupied parts of Papua New Guinea in 1942, bombed Darwin, Newcastle and Broome, and launched midget submarine attacks on Sydney harbour. The defence forces each country maintains reflect the fundamental discrepancy. The forces of the Republic of Korea are very substantial for a so-called ‘middle power’.
The country has a standing army of 560,000 troops backed up by reserves of 4.5 million and reinforced by 2000 main battle tanks. National service is compulsory. The Korean air force has 63,000 personnel and 538 combat aircraft, and in its navy are another 63,000 sailors manning 170 commissioned ships totalling 153,000 tonnes, including 10 submarines. Australia, on the other hand, has a full-time army of a mere 26,600 soldiers, reserves of 16,000, supported by 59 main battle tanks. There is no national service. The Australian air force has 71 fighters, 21 strike aircraft and a mixed bag of transports and trainers. The Australian navy has twelve frigates, six submarines and 14 patrol boats.Can military exercises between such asymmetrical forces with such different defence preoccupations serve any useful purpose? Put another way, do Australia and South Korea have enough in common to justify any kind of joint military operations? The answer is a qualified yes, mainly because both countries rely for their ultimate protection on separate bilateral arrangements with the United States.
And if Washington looks benignly on such bilateral exercises, the shared belief is they must be good. But the American military presence in Korea is much more immediate and much more poised for action than it is in Australia. Since the end of the Korean War, the United States has maintained a substantial garrison on the peninsula. Once armed with nuclear weapons and staged right up against the 38th parallel at bases such as Camp Casey as a ‘trip wire’, the US forces have been gradually scaled back and re-positioned. They are no longer equipped with nuclear weapons, their number has been reduced to around 28,000, and they no longer occupy large areas of prime land in the centre of Seoul and other major Korean cities. But they remain an intrusive presence nonetheless, and due to an archaic provision dating back to the Korean War, Korean forces would come under American command in the event of hostilities with the North. In Australia on the other hand, the United States maintains some military communications bases, but no fighting forces. Joint military exercises are routinely held in the Northern Territory and parts of Queensland, and there are occasional naval visits. But the American presence is generally low key and has no control over Australian forces, which is the way the majority of Australians prefer it.The purpose of military exercises between allies or friendly nations is not necessarily to practise facing a common enemy. Indeed, joint exercises are sometimes held between countries like Japan and the Republic of Korea, which have territorial or other unresolved disputes. The fact is that military commanders are eager to test their forces in war games to ensure they are effective. A fictitious enemy is created, and the exercises are planned around some aspect of containing or defeating it. The main thing is to hold the exercises. They can comprise night time navigational exercises or simulated bombing runs by military aircraft, simulated attacks on surface shipping by submarines, landing exercises, exercises designed to alleviate regional disasters, or manoeuvres by marines and commandos against piracy and ‘terror’ raids. There can also be exercises without fictitious enemies, such as search and rescue operations, as occur occasionally between the navies of Japan and Korea.The danger is that joint exercises may take place which actually exacerbate rather than deter a military threat from a third country. Thus annual Korean-US military exercises, one of which is taking place as I write, always stirs up North Korea, which puts its forces along the 38th parallel on high alert, gets on its moral high horse, and threatens condign punishment for such provocative activities. When ‘Exercise Team Spirit’ was conducted just before the 1988 Olympic Games, I asked the United States Ambassador at the time if it was an entirely wise move. He replied with some regret that the Pentagon marched to a different drum from the State Department, and that he had little say in the matter. South Korea provided a military exercise ground which none of the United States armed forces wanted to give up. As I see it, the difficulty with this new Korean-Australian defence joint statement is that, like Australia’s arrangements with Japan, it sends the wrong signals not to North Korea, but to China. Or rather, they are the right signals, but Korean and Australian politicians deny them. And these are that, led by the United States, the Republic of Korea, Australia and Japan are forging military arrangements to contain China. Australia’s agreement with Japan in 2008 upset Beijing, and the new arrangements with the ROK are likely to do the same. Imprecise but persistent reports that China is spending an excessive amount of money on upgrading its defence forces are subscribed to by both President Lee and Prime Minister Rudd. The problem here is to quantify ‘excessive’. Certainly China is building up its conventional forces, but I have yet to see an authoritative study showing conclusively that China’s military assets are moving ahead of other military powers in technical capacity, particularly those of the United States. Meanwhile, in the nuclear sphere, the authoritative Bulletin of the Atomic Scientists maintains that China’s nuclear weapons program continues to be characterised by cautious and very slow expansion, if expansion at all. Upsetting China is in neither country’s interests. China is South Korea’s largest trade partner, ahead of the United States. And it is the second-largest market for Australian minerals and energy after Japan. China has also demonstrated good citizenship and international responsibility in continuing to host the six party talks attempting to de-nuclearise North Korea. The present Australian government, as well as its conservative predecessor, would very much like a seat at that table. I suspect that in order to boost its credentials, Australia in 2008 switched its non-resident diplomatic accreditation in Pyongyang from the Australian Ambassador in Beijing to the Australian Ambassador in Seoul. Few heads of foreign missions in Seoul have such opportunities regularly to visit and observe North Korea from such a privileged position. Apart from the joint statement on global and security cooperation, what else did President Lee’s visit to Australia achieve? Well, it was an important opportunity to review bilateral relations since Prime Minister Rudd’s visit to Seoul in August 2008. Despite current global economic shifts, South Korea remains a key market for Australian minerals, energy and travel services, and Australia for Korean cars, electronic goods and appliances. We have increasing common interests in the activities of the United Nations, the OECD, and regional arrangements such as fisheries agreements, APEC, the ASEAN Regional Forum and the East Asian Summit. The Republic of Korea is also a dialogue partner in the Pacific Islands Forum, a body of central interest to Australia. Australia is also now home to an increasing Korean community of some 30,000 energetic citizens. They live mainly in Sydney. Australia and the Republic of Korea have moved a long way in pursuing common interests and goals since my time as Ambassador in Seoul in the late 1980s. A positive outcome from President Lee’s visit has been a sharpened awareness in Canberra and Sydney of the importance of the relationship.
About the author
Richard Broinowski, currently an Adjunct Professor in Media and Communications at the University of Sydney, was a senior Australian diplomat. He was Ambassador to Vietnam, the Republic of Korea, and to Mexico, the Central American Republics and Cuba. Fact or Fission - the Truth about Australia's Nuclear Ambitions is published by Scribe Books.
Other APSNet policy forums by Richard Broinowski:
Australian nuclear disarmament policy - hopes, doubts, and questions, Austral Policy Forum 09-3A, 5 February 2009
Australian nuclear weapons: the story so far, Austral Policy Forum, 06-23A 17 July 2006
Australia's New Nuclear Ambitions, Austral Policy Forum, 06-24A 24 July 2006
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The views expressed in this article are those of the author and do not necessarily reflect the official policy or position of the Nautilus Institute. Readers should note that Nautilus seeks a diversity of views and opinions on contentious topics in order to identify common ground.
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Russian president orders military rearmament
http://www.timesonline.co.uk/tol/news/world/europe/article5923560.ece
Tony Halpin, Moscow
President Medvedev ordered a major military rearmament today, warning that Russia faced the risk of "significant conflict".
In a stark assessment, Mr Medvedev said that Nato was still intent on expanding closer to Russia's borders and told military chiefs to raise the combat readiness of the country's armed forces.
NATO expansion remains the most significant matter blocking US-Russia relations, says Stephen Cohen a professor of Russian Studies at New York University, who believes there is a lot of dogma in the US about Russia.CLICK TO WATCH
Russia's Defence Minister also lashed out at the United States, accusing it of plotting to take control of energy and mineral resources in states bordering Russia.
Mr Medvedev called for modernisation of Russia's nuclear forces and said that "large-scale rearmament" of the army and navy would commence in 2011.
"Analysis of the military-political situation in the world shows that serious conflict potential remains in some regions.... attempts to expand the military infrastructure of Nato near the borders of our country are continuing," he told Defence Ministry officials.
"The primary task is to increase the combat readiness of our forces, first of all our strategic nuclear forces. They must be able to fulfil all tasks necessary to ensure Russia's security."
The hawkish tone of the remarks came despite recent improvements in relations between Russia and Nato, and attempts by President Obama to ease tensions with the United States over missile defence in eastern Europe that built up under his predecessor George W. Bush. They also coincided with Gordon Brown's most progressive speech yet on nuclear disarmament, in which the Prime Minister called for a "forward plan" to be agreed by nuclear and non-nuclear states.
Anatoly Serdyukov, the Defence Minister, told the same meeting that the US was attempting to gain gain control of oil and gas resources in Russia's former Soviet neighbours in the Commonwealth of Independent States (CIS).
Mr Serdyukov warned that "the likelihood of armed conflicts and their potential danger for our state are rising" as America sought to expand its influence around Russia's borders and push Moscow out.
"The military-political situation has been characterised by the US leadership's desire to attain global leadership and expand the United States' and their allies' military presence in regions adjacent to Russia," he said.
"America's aspirations have been aimed at getting access to mineral, energy, and other resources of CIS countries, and it has actively supported processes aimed at ousting Russia from the area of its traditional interests."
Mr Serdyukov admitted, however, that most of Russia's weaponry was "old and obsolete". Modern equipment acccounted for only 10 per cent of the army's existing arsenal.
Mr Medvedev ordered an increase in military exercises to improve combat readiness and told army chiefs that "no expense should be spared for that" despite the economic crisis sweeping through Russia.
The conflict with Georgia over South Ossetia last August had exposed weaknesses in Russia's weaponry and communications systems that had to be rectified quickly.
Mr Medvedev has stationed more than 7,000 troops in South Ossetia and Georgia's other breakaway region of Abkhazia. He recognised them as independent after the war, a move condemned by Nato, the US and the European Union.
The previous Republican administration under President Bush pushed hard for Nato to offer Membership Action Plans to Georgia and Ukraine, a move fiercely opposed by Moscow. Mr Obama has given no indication so far that he is as enthusiastic about Nato expansion.
He held out the prospect of a deal with the Kremlin over missile defence earlier this month in return for help with preventing Iran developing a nuclear bomb.
Mr Obama wrote to his Russian counterpart, saying that the plan to base interceptor missiles in Poland and a radar in the Czech Republic would be unnecessary if the nuclear threat from Iran was removed.
Mr Medvedev insisted that he would not engage in any "trade-off" but appeared encouraged at the time by what he described as the new signals coming from Washington. The initiative came shortly after Joe Biden, the US Vice-President, declared that the US wanted to press the "reset" button on relations with Russia.
NATO expansion requires Russia Army modernisation - Medvedev
17.03.2009, 12.40
MOSCOW, March 17 (Itar-Tass) - The enlarged meeting of the Defence Ministry leadership is held in Moscow for the first time with the participation of President Dmitry Medvedev, Itar-Tass learnt from chief of the public relations service of the Defence Ministry Alexander Drobyshevsky.
The agenda includes results of last year’s work, tasks for the present as well as the use of information and telecom technologies in military affairs.
The focal point of the discussion is the transfer of the Armed Forces to a new outlook, which started in 2008. In this connection, chief of the Russian General Staff, General of the Army Nikolai Makarov said earlier that while preparing the reform, the leadership “examined in detail the military and political situation and trends for its development, singled out threats for Russia which can emerge in foreseeable future”.
“The analysis of the military-political situation in the world has shown that a serious conflict potential remains in a number of regions, threats are persisting that cause both local conflicts and international terrorism, and the attempts at the enlargement of the NATO military infrastructure near the Russian borders are not stopping,” the president Medvedev stated.
“All this requires the quality modernisation of our Armed Forces and acquisition of a new advanced appearance by them,” believes Medvedev. “Despite the current financial difficulties, there are all the conditions for this today,” the president noted.
Medvedev stated that enhancement of the combat readiness of the troops, first of all of the strategic nuclear forces and advanced weaponry supply are the main tasks of the state.
According to Makarov, the main aim of the transfer of the Russian army to a new outlook is to form by 2015 modern, mobile, well trained Armed Forces, equipped with the latest samples of arms and military materiel; Armed Forces, capable of responding adequately to all possible threats. He noted that the reform had been perceived long enough, and the conflict with Georgia “was a catalyst which accelerated the adoption of the decision”.
It was announced last autumn of the start to form a new outlook of the Russian army. It provides for switching the military structure from the four echelon system of control (military district-army-division-regiment) to a three-echelon system (district-operational command-brigade), reshuffling of bodies of the central military administration, including the Defence Ministry and the General Staff, reduction of the commissioned officers component, abolition of the institute of non-commissioned officers and formation of a rapid response grouping.
Some military units and higher educational establishments will be disbanded during the reform.
Massive rearming of the Russian Armed Forces and the Navy will be started in 2011.
By 1012, it is planned to slash the Armed Forces from 1.13 million to one million servicemen, the central office of the ministry – to 8,500 people and the number of commissioned officers’ posts in the army and navy – from the present 355,000 to 150,000.
Tony Halpin, Moscow
President Medvedev ordered a major military rearmament today, warning that Russia faced the risk of "significant conflict".
In a stark assessment, Mr Medvedev said that Nato was still intent on expanding closer to Russia's borders and told military chiefs to raise the combat readiness of the country's armed forces.
NATO expansion remains the most significant matter blocking US-Russia relations, says Stephen Cohen a professor of Russian Studies at New York University, who believes there is a lot of dogma in the US about Russia.CLICK TO WATCH
Russia's Defence Minister also lashed out at the United States, accusing it of plotting to take control of energy and mineral resources in states bordering Russia.
Mr Medvedev called for modernisation of Russia's nuclear forces and said that "large-scale rearmament" of the army and navy would commence in 2011.
"Analysis of the military-political situation in the world shows that serious conflict potential remains in some regions.... attempts to expand the military infrastructure of Nato near the borders of our country are continuing," he told Defence Ministry officials.
"The primary task is to increase the combat readiness of our forces, first of all our strategic nuclear forces. They must be able to fulfil all tasks necessary to ensure Russia's security."
The hawkish tone of the remarks came despite recent improvements in relations between Russia and Nato, and attempts by President Obama to ease tensions with the United States over missile defence in eastern Europe that built up under his predecessor George W. Bush. They also coincided with Gordon Brown's most progressive speech yet on nuclear disarmament, in which the Prime Minister called for a "forward plan" to be agreed by nuclear and non-nuclear states.
Anatoly Serdyukov, the Defence Minister, told the same meeting that the US was attempting to gain gain control of oil and gas resources in Russia's former Soviet neighbours in the Commonwealth of Independent States (CIS).
Mr Serdyukov warned that "the likelihood of armed conflicts and their potential danger for our state are rising" as America sought to expand its influence around Russia's borders and push Moscow out.
"The military-political situation has been characterised by the US leadership's desire to attain global leadership and expand the United States' and their allies' military presence in regions adjacent to Russia," he said.
"America's aspirations have been aimed at getting access to mineral, energy, and other resources of CIS countries, and it has actively supported processes aimed at ousting Russia from the area of its traditional interests."
Mr Serdyukov admitted, however, that most of Russia's weaponry was "old and obsolete". Modern equipment acccounted for only 10 per cent of the army's existing arsenal.
Mr Medvedev ordered an increase in military exercises to improve combat readiness and told army chiefs that "no expense should be spared for that" despite the economic crisis sweeping through Russia.
The conflict with Georgia over South Ossetia last August had exposed weaknesses in Russia's weaponry and communications systems that had to be rectified quickly.
Mr Medvedev has stationed more than 7,000 troops in South Ossetia and Georgia's other breakaway region of Abkhazia. He recognised them as independent after the war, a move condemned by Nato, the US and the European Union.
The previous Republican administration under President Bush pushed hard for Nato to offer Membership Action Plans to Georgia and Ukraine, a move fiercely opposed by Moscow. Mr Obama has given no indication so far that he is as enthusiastic about Nato expansion.
He held out the prospect of a deal with the Kremlin over missile defence earlier this month in return for help with preventing Iran developing a nuclear bomb.
Mr Obama wrote to his Russian counterpart, saying that the plan to base interceptor missiles in Poland and a radar in the Czech Republic would be unnecessary if the nuclear threat from Iran was removed.
Mr Medvedev insisted that he would not engage in any "trade-off" but appeared encouraged at the time by what he described as the new signals coming from Washington. The initiative came shortly after Joe Biden, the US Vice-President, declared that the US wanted to press the "reset" button on relations with Russia.
NATO expansion requires Russia Army modernisation - Medvedev
17.03.2009, 12.40
MOSCOW, March 17 (Itar-Tass) - The enlarged meeting of the Defence Ministry leadership is held in Moscow for the first time with the participation of President Dmitry Medvedev, Itar-Tass learnt from chief of the public relations service of the Defence Ministry Alexander Drobyshevsky.
The agenda includes results of last year’s work, tasks for the present as well as the use of information and telecom technologies in military affairs.
The focal point of the discussion is the transfer of the Armed Forces to a new outlook, which started in 2008. In this connection, chief of the Russian General Staff, General of the Army Nikolai Makarov said earlier that while preparing the reform, the leadership “examined in detail the military and political situation and trends for its development, singled out threats for Russia which can emerge in foreseeable future”.
“The analysis of the military-political situation in the world has shown that a serious conflict potential remains in a number of regions, threats are persisting that cause both local conflicts and international terrorism, and the attempts at the enlargement of the NATO military infrastructure near the Russian borders are not stopping,” the president Medvedev stated.
“All this requires the quality modernisation of our Armed Forces and acquisition of a new advanced appearance by them,” believes Medvedev. “Despite the current financial difficulties, there are all the conditions for this today,” the president noted.
Medvedev stated that enhancement of the combat readiness of the troops, first of all of the strategic nuclear forces and advanced weaponry supply are the main tasks of the state.
According to Makarov, the main aim of the transfer of the Russian army to a new outlook is to form by 2015 modern, mobile, well trained Armed Forces, equipped with the latest samples of arms and military materiel; Armed Forces, capable of responding adequately to all possible threats. He noted that the reform had been perceived long enough, and the conflict with Georgia “was a catalyst which accelerated the adoption of the decision”.
It was announced last autumn of the start to form a new outlook of the Russian army. It provides for switching the military structure from the four echelon system of control (military district-army-division-regiment) to a three-echelon system (district-operational command-brigade), reshuffling of bodies of the central military administration, including the Defence Ministry and the General Staff, reduction of the commissioned officers component, abolition of the institute of non-commissioned officers and formation of a rapid response grouping.
Some military units and higher educational establishments will be disbanded during the reform.
Massive rearming of the Russian Armed Forces and the Navy will be started in 2011.
By 1012, it is planned to slash the Armed Forces from 1.13 million to one million servicemen, the central office of the ministry – to 8,500 people and the number of commissioned officers’ posts in the army and navy – from the present 355,000 to 150,000.
China’s Naval Force Projection off Somalia
http://www.idsa.in/publications/stratcomments/SRajasimman020309.htm
S.Rajasimman
March 02, 2009
Call it China’s new military diplomacy or emerging naval strategy. A Chinese naval fleet arrived in the Gulf of Aden off the Somalian coast on January 6, 2009 to carry out the first escort mission against pirates. On February 18, 2009, in an efficient display of its growing naval capabilities, the fleet completed its twenty first mission (the largest held so far in the series) of escorting merchant ships in this region. Ten Chinese merchant ships were part of the convoy while three foreign ones, including Hermione from Germany, Viking Crux from Singapore and Princess Nataly from Cyprus requested protection and were escorted by the Chinese fleet. The fleet sailed from a port in Sanya city of China’s southernmost island province of Hainan on December 26, 2008. The fleet comprises two destroyers (Haikou and DDG-169 Wuhan) and a supply ship (Weishanhu) from the South China Sea Fleet. The fleet carried about 800 crew members, including 70 soldiers from the Navy’s special force, and was equipped with ship-borne missiles and light weapons.
It is timely to explore this issue given the Chinese motivation in conducting naval operations far away from the mainland for the first time. There seems to be a general consensus among many Chinese military and non-military experts that circumstances were favourable for projecting force at such a distance. Firstly, China has gained enough experience in long distance naval force deployment due its frequent military exchanges with other countries. The logistics problem of supply and refuelling was no longer seen as a constraint. While on its way to the Somalian coast, the fleet displayed its supply and refuelling capability as it entered the Indian Ocean through the Malacca Straits. The supply ship Weishanhu refuelled the two destroyers with several hundred tons of oil, an operation that an official described as “highly efficient”.
The fact that two Chinese ships, a fishing vessel and a Hong Kong-flag ship with a 25-member crew, were seized by Somalian pirates in October 2008 does not qualify as a potential reason for this long distance naval deployment. These hijacks occurred off the Kenyan coast, and the total number of hijacks of Chinese vessels so far constitutes only 0.7 per cent of the total passages. Therefore, the decision may be due to other factors over and above the one involving immediate Chinese interest. Prior to deployment, China explicitly believed that any action in the Gulf of Aden must be carried out within the “United Nations Framework”. In his address to the United Nations on December 16, 2008 China’s Vice Foreign Minister had said that “China is seriously considering sending naval ships to the Gulf of Aden and waters off the Somali coast for escorting operations in the near future.” The minister also added that China appreciated the efforts made by other Navies to curb the problem of piracy. This needs to be contrasted with the Chinese government’s stand on growing intervention based military strategies. The China Defence White Paper, 2000 stated that the UN role in securing international peace was on the decline because of unilateral actions taken by some countries outside the United Nations Security Council framework (e.g. the Kosovo intervention). In the above mentioned address to the UN by the Vice Foreign Minister, he had said that the UN should also attempt to resolve the root causes of piracy in Somalia. The Chinese believe that piracy is a direct consequence of the domestic politico-military-economic condition within Somalia. The transitional federal government in place in Somalia had worked up the power ladder with American support and displaced the Islamic Courts Union (ICU), which still holds huge mass support especially in Southern Somalia. This is indicative of US efforts in the war against terrorism. Furthermore, in the absence of multilateral operations under the UN, Somalia may in the future become a scene of unilateral intervention by the US and Britain or both. Piracy thus seems to be only the tip of the iceberg. However, Chinese behaviour is inconsistent with its political rhetoric at least at the level of policy. On June 24, 2007 C.N.O.O.P signed a deal with Somali President Abdullah Yusuf to explore the northern Puntland region for oil. This deal was signed in a hurry prior to the Somali government framing the National Oil Rules (NOR). Chinese firms backed by their government seem to be willing to take economic and political risks which western firms would shy away from. Any unilateral military action by western powers would affect Chinese interests in the region. Like the anti-satellite test in early January 2007, China seems to project its capabilities as part of its extending diplomacy without breaking any rules.
China, which became a permanent member of the UN Security Council only in 1971, did not engage in peace keeping operations until 1989. In 1989, it began its first exploratory foray into UN peacekeeping missions, sending non-military observers to join the UN Namibia Transitional Period Aid Group overseeing a general election. In 1990, China dispatched military observers to the Middle East in support of the UN Truce Supervision Organization (UNTSO). One reason for this transition was the Tiananmen Square incident, when the People’s Liberation Army was caught on the wrong foot with its own people. This incident stimulated the need for the PLA to conduct more people-oriented activities such as disaster relief, domestic security, and other measures, but also, very importantly, participation in UN peacekeeping operations. This transition has now made China the largest contributor by a permanent member of the UN Security Council (in close competition with France).The second reason is the PRC’s concern over sovereignty and its violation through intervention. China was not supportive of UN mandated Blue Helmet operations due to its national experience. During the Cold War, the United Nations had formally sanctioned the use of force only once and China itself was at the receiving end during the UN-mandated operations in the Korean Peninsula in the early 1950s. With the Cold War world order overthrown in this era of intense economic interdependence, China’s concern seems to be reorienting. The third reason could be that Chinese concerns over Taiwan, Tibet and Xinjiang, which, if left uncontrolled, could become cases for intervention.
Another important motivation behind the decision to deploy a Chinese naval force off Somalia could be the fact that this involves the African continent where Beijing has substantial economic investments. Chinese leaders have been frequenting Africa since 2000. As a leading importer of crude oil, China depends on Africa for 25 per cent of its oil needs, which is projected to go up to 40 per cent by 2020. It has granted extensive debt packages to Africa on a no strings attached basis and its bilateral trade is expected with the continent is expected to touch US $100 billion by 2010. Suffice it to say that China’s stakes and advantages in Africa are high. The overall expected output of oil by Chinese firms in Africa is 78 million tons (presently the output is 40.3 million tons). China also depends on Saudi Arabia for its crude oil imports and has huge markets in Europe. Chinese merchant ships will have to necessarily frequent the waters off the Somali coast.
Given the country’s limited force projection capability, China’s action is consistent with its overall policy strategy of creating an international order that is different from the Cold War order. Securing international peace and development is currently an objective of China’s foreign policy. The current international environment will only help China achieve its strategic and developmental goals. It will enhance its image as a responsible power in the twenty first century and give it the experience to conduct naval operations far from its shores.
A few decades ago, while articulating new ways to use the National Defence Force (NFD), Deng Xiaoping’s had stated that “When our country is developed and more prosperous, we shall have a bigger role to play in the world.” After almost three decades this seems to be coming true.
S.Rajasimman is Research Assistant at the Institute of Defence Studies and Analyses, New Delhi.
S.Rajasimman
March 02, 2009
Call it China’s new military diplomacy or emerging naval strategy. A Chinese naval fleet arrived in the Gulf of Aden off the Somalian coast on January 6, 2009 to carry out the first escort mission against pirates. On February 18, 2009, in an efficient display of its growing naval capabilities, the fleet completed its twenty first mission (the largest held so far in the series) of escorting merchant ships in this region. Ten Chinese merchant ships were part of the convoy while three foreign ones, including Hermione from Germany, Viking Crux from Singapore and Princess Nataly from Cyprus requested protection and were escorted by the Chinese fleet. The fleet sailed from a port in Sanya city of China’s southernmost island province of Hainan on December 26, 2008. The fleet comprises two destroyers (Haikou and DDG-169 Wuhan) and a supply ship (Weishanhu) from the South China Sea Fleet. The fleet carried about 800 crew members, including 70 soldiers from the Navy’s special force, and was equipped with ship-borne missiles and light weapons.
It is timely to explore this issue given the Chinese motivation in conducting naval operations far away from the mainland for the first time. There seems to be a general consensus among many Chinese military and non-military experts that circumstances were favourable for projecting force at such a distance. Firstly, China has gained enough experience in long distance naval force deployment due its frequent military exchanges with other countries. The logistics problem of supply and refuelling was no longer seen as a constraint. While on its way to the Somalian coast, the fleet displayed its supply and refuelling capability as it entered the Indian Ocean through the Malacca Straits. The supply ship Weishanhu refuelled the two destroyers with several hundred tons of oil, an operation that an official described as “highly efficient”.
The fact that two Chinese ships, a fishing vessel and a Hong Kong-flag ship with a 25-member crew, were seized by Somalian pirates in October 2008 does not qualify as a potential reason for this long distance naval deployment. These hijacks occurred off the Kenyan coast, and the total number of hijacks of Chinese vessels so far constitutes only 0.7 per cent of the total passages. Therefore, the decision may be due to other factors over and above the one involving immediate Chinese interest. Prior to deployment, China explicitly believed that any action in the Gulf of Aden must be carried out within the “United Nations Framework”. In his address to the United Nations on December 16, 2008 China’s Vice Foreign Minister had said that “China is seriously considering sending naval ships to the Gulf of Aden and waters off the Somali coast for escorting operations in the near future.” The minister also added that China appreciated the efforts made by other Navies to curb the problem of piracy. This needs to be contrasted with the Chinese government’s stand on growing intervention based military strategies. The China Defence White Paper, 2000 stated that the UN role in securing international peace was on the decline because of unilateral actions taken by some countries outside the United Nations Security Council framework (e.g. the Kosovo intervention). In the above mentioned address to the UN by the Vice Foreign Minister, he had said that the UN should also attempt to resolve the root causes of piracy in Somalia. The Chinese believe that piracy is a direct consequence of the domestic politico-military-economic condition within Somalia. The transitional federal government in place in Somalia had worked up the power ladder with American support and displaced the Islamic Courts Union (ICU), which still holds huge mass support especially in Southern Somalia. This is indicative of US efforts in the war against terrorism. Furthermore, in the absence of multilateral operations under the UN, Somalia may in the future become a scene of unilateral intervention by the US and Britain or both. Piracy thus seems to be only the tip of the iceberg. However, Chinese behaviour is inconsistent with its political rhetoric at least at the level of policy. On June 24, 2007 C.N.O.O.P signed a deal with Somali President Abdullah Yusuf to explore the northern Puntland region for oil. This deal was signed in a hurry prior to the Somali government framing the National Oil Rules (NOR). Chinese firms backed by their government seem to be willing to take economic and political risks which western firms would shy away from. Any unilateral military action by western powers would affect Chinese interests in the region. Like the anti-satellite test in early January 2007, China seems to project its capabilities as part of its extending diplomacy without breaking any rules.
China, which became a permanent member of the UN Security Council only in 1971, did not engage in peace keeping operations until 1989. In 1989, it began its first exploratory foray into UN peacekeeping missions, sending non-military observers to join the UN Namibia Transitional Period Aid Group overseeing a general election. In 1990, China dispatched military observers to the Middle East in support of the UN Truce Supervision Organization (UNTSO). One reason for this transition was the Tiananmen Square incident, when the People’s Liberation Army was caught on the wrong foot with its own people. This incident stimulated the need for the PLA to conduct more people-oriented activities such as disaster relief, domestic security, and other measures, but also, very importantly, participation in UN peacekeeping operations. This transition has now made China the largest contributor by a permanent member of the UN Security Council (in close competition with France).The second reason is the PRC’s concern over sovereignty and its violation through intervention. China was not supportive of UN mandated Blue Helmet operations due to its national experience. During the Cold War, the United Nations had formally sanctioned the use of force only once and China itself was at the receiving end during the UN-mandated operations in the Korean Peninsula in the early 1950s. With the Cold War world order overthrown in this era of intense economic interdependence, China’s concern seems to be reorienting. The third reason could be that Chinese concerns over Taiwan, Tibet and Xinjiang, which, if left uncontrolled, could become cases for intervention.
Another important motivation behind the decision to deploy a Chinese naval force off Somalia could be the fact that this involves the African continent where Beijing has substantial economic investments. Chinese leaders have been frequenting Africa since 2000. As a leading importer of crude oil, China depends on Africa for 25 per cent of its oil needs, which is projected to go up to 40 per cent by 2020. It has granted extensive debt packages to Africa on a no strings attached basis and its bilateral trade is expected with the continent is expected to touch US $100 billion by 2010. Suffice it to say that China’s stakes and advantages in Africa are high. The overall expected output of oil by Chinese firms in Africa is 78 million tons (presently the output is 40.3 million tons). China also depends on Saudi Arabia for its crude oil imports and has huge markets in Europe. Chinese merchant ships will have to necessarily frequent the waters off the Somali coast.
Given the country’s limited force projection capability, China’s action is consistent with its overall policy strategy of creating an international order that is different from the Cold War order. Securing international peace and development is currently an objective of China’s foreign policy. The current international environment will only help China achieve its strategic and developmental goals. It will enhance its image as a responsible power in the twenty first century and give it the experience to conduct naval operations far from its shores.
A few decades ago, while articulating new ways to use the National Defence Force (NFD), Deng Xiaoping’s had stated that “When our country is developed and more prosperous, we shall have a bigger role to play in the world.” After almost three decades this seems to be coming true.
S.Rajasimman is Research Assistant at the Institute of Defence Studies and Analyses, New Delhi.
March 16, 2009
BALOCHISTAN: From Pakistan to Cardiff: The King of Kalat
Khan of Kalat ( Right) , Dr.Wahid Baloch President BSO-NA.ORG (Left)
Independent.co.uk
A royal asylum-seeker wants to stop the Taliban and win independence for his Baluch people ... if only he could escape from South Wales.
Jerome Taylor reports
Monday, 16 March 2009
In an anonymous pebble-dashed semi-detached house on the outskirts of Cardiff, a powerfully built, bearded man with a green prayer cap looks through a folio of 19th-century letters sent by the British Government to his kingdom.
Stashed in overflowing plastic bags and a tattered brown suitcase, some are even written on pieces of animal skin. Rummaging through the case, he pulls out a large piece of parchment, stained yellow with time and covered with lines of elegant Persian script.
"This is the first treaty that was signed between my people and the British in 1841," he says. "It was the first piece of paper signed by the British that recognised the state of Kalat."
Welcome to the humble Welsh abode of His Royal Highness Khan Suleman Daud, the 35th Khan of Kalat.Until three years ago, Khan Suleman's house was a sumptuous desert palace on a windswept ridge in Baluchistan – the mountainous and mineral-rich Pakistani province where separatists have waged an insurgency to carve out their own independent state for much of the past 60 years.
Whenever the Khan left his palace in his two armour-plated, gold Humvees, he would be accompanied by dozens of armed bodyguards. One of western Pakistan's most influential tribal leaders, he commanded the loyalty and respect of thousands of Baluch tribesmen and had long angered Pakistan's military establishment by campaigning for independence, though he opposes armed resistance.
The Khan was forced to flee after being targeted for speaking out against the Pakistani military's well-documented human rights abuses. He now whiles away his days as an anonymous asylum-seeker in south Wales, separated from his people by 4,000 miles and trapped in the seemingly everlasting limbo of Britain's immigration system.
He left Pakistan after the military assassination of Akbar Khan Bugti, 79, the soft-spoken, Oxford-educated, separatist leader accused by the Pakistanis of co-ordinating the shadowy Baluchistan Liberation Army (BLA).
"I want more than anything to return to my homeland, but I cannot at the moment," said the Khan. "If I returned to Pakistan, my life would be in danger because the military regard me as a threat. And yet, everything I have is back in Kalat. Back home, I have palaces, vast amounts of land, the respect and love of my people. Here I am in limbo, living in a three bedroom house in Cardiff."
That someone as influential as the Khan has ended up as an asylum-seeker in Britain – a country that he says "betrayed" the Baluch people – offers a 21st-century snapshot of colonial fall-out.
Locating Khan Suleman's kingdom on a map of the world is difficult but, less than a century ago, the Khanate of Kalat was a thriving confederacy of tribes spread across much of what is now western Pakistan, southern Afghanistan and south-eastern Iran.
Populated by fiercely independent Baluch warriors, Kalat retained much of its independence from the British as the Raj's political agents spread throughout the sub-continent, toppling, bribing and replacing its regional leaders as they went.
Regarded as too wild to tame but a useful buffer against Russians, the Baluch were allowed to keep their sovereignty. Although successive treaties chipped away at their territory, the Khans of Kalat remained the region's most powerful independent rulers.
As the Partition of India loomed, Khan Suleman's grandfather, Ahmad Yar Khan, was assured that the Baluch would be allowed to keep their independence. A deal was struck whereby Kalat and the new state of Pakistan would be independent of each other but would share currency, foreign policy and defence equally.
Yet, after just six months of independence, the Pakistani military stormed in and forced Ahmed Yar Khan to cede his khanate to Pakistan. Forgotten by the West, Baluchi separatists have since fought five insurgencies to try to claw back their independence from Pakistan's central government, which has responded with massacres, large scale disappearances and torture.
"The British treated us treacherously and pushed us into a union with Pakistan," said the Khan as he prepared a traditional Baluchi dish of roast chicken and spicy meat cutlets. "We had no desire to be part of Pakistan but we were ignored and the agreement was eventually forced down our throats. Till the very last moment, they kept us in the dark. All the time we were assured that the Baluch would keep their independent state but instead we were sold down the river."
Yet Britain's historical behaviour in his homeland is not the only thing bothering this tribal leader.
"I applied for asylum on 14 July 2007," he said. "I even put myself forward for the fast-track scheme, yet here we are, nearly two years later, still waiting for a response. I have been stonewalled by virtually every official we have come across." When the Khan went to register as an asylum-seeker in Croydon, he was surrounded by buzzing immigration officials, keen to see his passport which says "His Highness". "It is very different to how other Pakistani leaders have been treated."
The Government welcomed other exiled Pakistani politicians such as Nawaz Sharif and Benazir Bhutto during their own spells in the wilderness. Both former prime ministers spent years in London during their spats with the then-military dictator, Pervez Musharraf, but never had to apply for asylum.
The Khan had never intended to remain in Britain. At a loya jirga (tribal gathering) called after Bugti's assassination, he vowed to take the plight of his people to the International Court of Justice in The Hague in a bid to apply international pressure on the Pakistanis over their treatment of the Baluch.
He was placed on a watch list by Mr Musharraf but managed to fly out undetected from Karachi to perform the Hajj. When his British visa was rejected, he applied for asylum fearing deportation back to Pakistan. As a prospective asylum-seeker, he is unable to travel to The Hague and campaign for his people.
The Khan believes the British have agreed to remain silent over Baluchistan and keep him in limbo in return for Pakistan's co-operation in hunting down UK-born Islamic radicals.
Britain is the only country other than Pakistan to have proscribed the main Baluchi separatist movements as terror groups. They only did so in 2005, after Mr Musharraf threatened to withdraw from talks aimed at securing the extradition of Birmingham-born Rashid Rauf, the suspected ringleader of the transatlantic airliner bomb plot who was eventually killed by an unmanned US drone last year.
The only Baluch nationals living in the UK to be charged under terror legislation were acquitted last month. Faiz Baluch, 27, and Hyrbyair Marri, 40, stood accused of being members of the BLA and encouraging terrorism overseas but the jury found them not guilty. Their supporters claim the prosecution aimed to curry favour with the Pakistanis.
A devout Muslim, the Khan is critical of Islamic radicalism. But he worries that the continued repression of the Baluch, coupled with the de facto silencing of their tribal leaders, is forcing many formerly secular separatists into the arms of the Taliban instead.
The Taliban have held little sway over the Baluchi tribes other than in and around the provincial capital, Quetta. But Islamic radicalism appears to be spreading through the region. Two weeks ago, the Pakistani Taliban leaders announced the creation of a new group, "Tehreek-e-Taliban Baluchistan".
Marooned in his Cardiff semi, The Khan says he desperately wants to halt the radicalisation of the Baluch but no-one, it seems, is willing to listen to a king with no kingdom.
Message from Gul Agha:
The article shows the dedication of the Khan to his people, his willingness to sacrifice his palaces to live as a simple man cooking his own food but to struggle on
PAKISTAN: UNITED STATES POLICY AND STRATEGIC DILEMMAS
By Dr. Subhash Kapila
Introductory Observations
Pakistan’s ongoing political crisis places this nation once again at strategic crossroads in terms of its future existence as a viable and politically stable state.
The ongoing crisis should not be mistakenly viewed as an egoistic personality clash between President, Zardari, a political novice,and twice Prime Minister Nawaz Sharif. It should be more realistically viewed as a mass Pakistani political movement for restoration of unadulterated democracy in Pakistan, democratic institutions and independence of Pakistan’s judiciary centred on restoration to office of the illegally sacked Chief Justice of Pakistan, Chief Justice Chaudhary and 60 other judges by General Musharraf.
Pakistan’s present crisis was a foregone conclusion when viewed in the context of political manoeuvres undertaken by the Pakistan Army with United States blessings to install a political novice and politically discredited Zardari as President of Pakistan without clipping the Presidents powers left as a legacy by General Musharraf as military ruler.
Politically, the net effect in Pakistan has been that despite the return of parliamentary democracy in Pakistan in 2008, Zardari installed as President in September 2008, exercised powers of a President as in a presidential form of democratic governance.
Pakistan’s democracy was grudgingly conceded by the Pakistan Army, ostensibly under United States pressures in the face of massive street demonstrations in 2007-2008, but it was adulterated democracy that had returned.
Once again, the United States in pursuit of tactical expediency rather than long term strategic vision, stood on the wrong side of history in Pakistan’s evolving political dynamics. The United States has continued to over-invest in the Pakistan Army rather than in favor of Pakistani peoples-centric policies.
Political crises are endemic in Pakistan’s political dynamics as a result of the fragility of Pakistan’s political structures that were never allowed to become strong by the vested political interventions of the Pakistan Army and the strategic interests of Pakistan Army’s external patrons.
Astutely observed, Michael Krepon of the Washington think tank Stimson Center made the following observations on Pakistan(1)Political crises in Pakistan have periodically surfaced (2)Crises were created by policies of the Pakistan Army and its military rulers (3) Crises not solved by the Pakistani creators of crises (4) Pakistan’s political crises were solved only with the creators of the crisis being made to exit the political scene.
President Zardari’s forced exit from the office of the President may solve the present crisis. Notwithstanding the eventuality what it leaves in its wake for the United States are serious policy and strategic dilemmas.
The United States policy and strategic predicaments in Pakistan stood consistently analyzed by this Author in the following SAAG Papers commencing with SAAG Paper No. 812 dated 07/10/2003 entitled “US Policy Predicaments in Pakistan” and resting with SAAG Paper No. 3055 dated 17/02/2009 entitled “United States Imperatives to “Reset” Pakistan Policy."
This Paper once again attempts to review United States policy and strategic dilemmas in Pakistan in the contemporary context under the following heads:
United States Predicaments in Pakistan as Viewed in 2003
United States Policyand Strategic Dilemmas in March 2009
United States Fixatious Mindsets on Pakistan: Imperatives for Reorientation
United States Predicaments in Pakistan as Viewed in 2003
The following observations made in this Author’s 2003 SAAG Paper quoted above are pertinent today too and pertinent with a vengeance:
“Pakistan once again presents policy predicaments to United States policy makers. The United States today is facing an Islamic onslaught and Pakistan is the most untrustworthy candidate to combat it on America’s behalf having been the spearhead of Islamic Jihad for over a decade.”
“Further, Pakistan itself is divided by internal strife endangering the future of this militarized nation state.”
“Therefore, the United States options in Pakistan today are limited and basic.”
After surveying the perceptional schisms in the United States between the US Administration and American think tanks this Author set out and analysed three policy options available to USA “keeping in mind the prospects of military coup, civil war and fragmentation of Pakistan”, The Three Options analysed were as under:
Option I Stable General Musharraf
Option II Stable Pakistan Army
Option III Stable Democratic Pakistan Nation State
These options basically centered on the means to achieve stability in Pakistan. It was also asserted that these three Options could not be considered as synonymous as they carried separate implications for both Pakistan and the United States.
Readers can study the first two Options in the SAAG Paper referred, but one would like to concentrate on Option III i.e. ‘Stable and Democratic Pakistan’, which was analysed as “It entails that a political climate is engineered in Pakistan by the United States which could ensure the following:
“Pakistan Army's role in the political and foreign affairs of Pakistan be marginalized and Pakistan Army is forced to return to the barracks.”
“Restoration of Parliamentary (not presidential) democracy in Pakistan in elections initially to be conducted in presence of foreign observers to pre-empt rigging by Pakistan Army and its ISI”
“Pakistan Army be made subservient to the Parliamentary System.”
“De-jehadisation of Pakistan as an essential pre-condition for economic aid from international donors and foreign investments”
The following assertions were made in Option III analysis:
“A democratic Pakistan in full civilian control, however disorderly to begin with, due to prolonged spells of Pakistan Army misrule, will be at peace with itself, peace with its South Asian neighbours and more amenable to United States advice and directions.”
“If historical precedents are to go by, then the United States would find it very difficult to adopt Option III, unless Cold War mindsets are changed in the civil and military bureaucracies in Washington. For them it is easy to deal with military rulers of Pakistan.”
“Yet, it is imperative that the United States adopts Option III for its own long term good in terms of its political standing and strategic interests in South Asia.”
Six years down the line, Option III remained unadopted by the United States. The United States engineered the return of democracy in 2008 but not in unadulterated form and the Pakistan Army while not in direct control continues to exercise quasi-political control over Pakistan’s polity.
United States and Strategic Dilemmas in March 2009
As on 15 March 2009, at the time of writing this Paper, Pakistan for all practical purposes is in the grip of a serious violent confrontation between President Zardari and the Opposition parties led by Muslim League (N) leader, former twice Prime Minister Nawaz Sharif.
The visuals from Pakistan indicate massive protest demonstrations on the streets of Pakistan, moreso in the majority province of Pakistan. The massive size of peoples demonstrations has surprised even former PM Nawaz Sharif spearheading the movement for restoration of the 1973 Constitution, restoration of the independent Supreme Court judiciary and repeal of the NRO which would unseat President Zardari and enable prosecution of General Musharraf.
Buoyed by the size of peoples demonstrations in his support former PM Nawaz Sharif has now refused any dialogue with President Zardari.
Somebody has to blink and here once again one recalls Nuchael Krepon’s observations at the beginning of this Paper, that Pakistani crises were only solved by the exit of the initiator of the crisis.
Since President Zardari has initiated the present political crisis by his broken pledges and manipulating judicial verdicts against his political opponents by his packed courts he is the most likely to be forced by the Pakistan Army and the United States to exit the political scene. The United States can ill ignore the massive Pakistan’s peoples outpouring on the streets of Pakistan in favor of Nawaz Sharif.
The major policy and strategic dilemmas to the United States in the developing situation in Pakistan where former PM Nawaz Sharif emerges in power are as follows:
Can the United States effectively re-calibrate its policies to adjust and engage with a strong Punjabi Prime Minister of Pakistan?
One can additionally ask here a question and that is if the United States has an over-reliance on the Pakistan Army which is predominantly Punjabi dominated in all echelons, than why is the United States chary of having Punjabi Prime Ministers at the helm of Pakistan?
Former PM Nawaz Sharif is most likely to reattempt bringing Pakistan Army under firm civilian political control. In that eventuality can the United States prevail over the Pakistan Army not to indulge once again in military coup as it did in 1999?
The Pakistan Army as it is has not contributed effectively to control Taliban onslaughts against US & NATO Forces in Afghanistan. A US-restrained Pakistan Army may just stand aloof from supporting operations in Afghanistan in the ensuing scenario. Is the United States prepared to deal with such a contingency or once again succumb to Pakistan Army pressures that USA has no other alternative but to submit to Pakistan Army’s preferences?
Does the United States have the political will to disconnect the Pakistan Army from its foreign policy formulations and strategic blueprint in South Asia?
Is the United States ready to release itself from existing mindsets within its policy establishment and recalibrate and reorient its policies with an overriding priority on Pakistan’s emergence as a stable democracy?
These are major policy challenges for the United States policy establishment and no current indicators are available even against the backdrop of the evolving explosive situation in Pakistan that United States is ready for a major re-orientation in its Pakistan policy other than band-aid solutions.
United States Fixatious Mindsets on Pakistan: Imperatives for Reorientation
This Author, over the years, analyzing United States policy directions in Pakistan has always stood intrigued by the following manifestations:
United States officialdoms fixatious mindsets that Pakistan has a critical role to play in the US global strategic blueprint
Pakistan is a “frontline state” protecting US strategic interests in the region
United States official ‘lionizing’ of the Pakistan Army and bestowing billions of US dollars to strengthen its combat effectiveness. In real terms it continues to reinforcing Pakistan Army’s military adventurism.
Schisms exist between the above manifestations of the US policy establishment under different political dispensations and the think-tanks in Washington, the US media and the US academia on the other hand.
The US think-tanks come out with realistic assessments and well substantiated too on Pakistan’s lack of strategic utility to US national security interests and these were at variance with what the official policy establishment pursues in its formulations.
One in intrigued as to how such worthwhile assessments from prestigious Washington think-tanks are not translated or incorporated into US official policies on Pakistan.
Such official mindsets in the United States, more reminiscent of Cold wwolicy determinations, are no longer valid in the evolving global political and strategic milieu. Such mindsets have distorted US policies in South Asia to the detriment of the US national security interests.
United States prevailing policy mindsets have led to (1) Pakistan being encouraged to box much above its political and strategic weight (2) Pakistan’s nuclear weaponisation and WMD proliferation (3) Pakistan Army emerging as the leading proponent. and facilitator of global Islamic Jihad.
The Obama Administration in the pursuit of giving a new look to United States foreign policy would be well advised to “reset” its Pakistan policy as argued in this Author’s Paper: “United States Imperatives to Reset Pakistan Policy "(SAAG Paper No. 3055 dated 17 Feb. 2009).
The American over-reliance on the Pakistan Army to dictate terms and determine Pakistan’s political dynamics requires re-orientation with a priority investment by USA on Pakistan emerging as a strong and stable democracy.
The latest news flowing in from Pakistan is that President Zardari has blinked under United States pressures and US pressures applied through the Pakistan Army to defuse the crisis. President Zardari has agreed to re-install Chief Justice Chaudhary as Chief Justice of Pakistan and so also the 60 other judges deposed by General Musharraf.
This is only, the first step towards defusing the ongoing Pakistan’s political crisis. It needs to be watched whether the 17th Amendment is abolished and so also Governor’s rule on Punjab set aside.
All this proves that while Pakistan relies on China for strategic and military sustenance, it is the United States which has a controlling influence on Pakistan’s political dynamics.
If that be so, then other than tactical expediencies, nothing holds back the United States to ensure the return of unadulterated democracy to Pakistan.
The United States main strategic interests in Pakistan can be enumerated as under (1) Pakistan continues as a strategic base for US & NATO Forces operations in Afghanistan (2) Pakistan’s badlands of FATA do not spawn another 9/11 terrorist attack on USA (3) Nuclear terrorism (4) WMD proliferation by Pakistan.
A stable and democratic civilian government in Islamabad with the Pakistan Army under firm civilian political control ensured by the United States would be better placed in the long run to serve US national security and strategic interests.
If the Obama Administration sincerely believes in its catchy slogan “Yes, we can” then in relation to Pakistan, it should be the top most priority to ensure a “Stable and Democratic Pakistan”. The US President has to ensure that this message percolates down to the civil and military bureaucracies in Washington.
Concluding Observations
The United States has for more than 60 years stood on the wrong side of history in Pakistan. Its support of Pakistan’s military regimes and civilian dictators has brought about a cumulative effect where Pakistan’s very existence as a nation-state has been made fragile and where anti-Americanism is the predominant mood in the masses.
Commencing in March 2007 and repeated now in March 2009, the massive turnout of Pakistanis on the streets in protest demonstrations is a reminder that they demand a complete transformation of Pakistan’s governance and political set up. Pakistanis predominantly want unadulterated democracy, human rights and liberal political institutions.
For the United States it is a major and critical policy dilemma as to whether it has the will to forsake the Pakistan Army as its instrument to further its strategic interests in South Asia and foster uninhibited democracy in Pakistan. It has yet to give any indications to this effect.
(The author is an International Relations and Strategic Affairs analyst. He is the Consultant, Strategic Affairs with South Asia Analysis Group. Email:drsubhashkapila.007@gmail.com)
Introductory Observations
Pakistan’s ongoing political crisis places this nation once again at strategic crossroads in terms of its future existence as a viable and politically stable state.
The ongoing crisis should not be mistakenly viewed as an egoistic personality clash between President, Zardari, a political novice,and twice Prime Minister Nawaz Sharif. It should be more realistically viewed as a mass Pakistani political movement for restoration of unadulterated democracy in Pakistan, democratic institutions and independence of Pakistan’s judiciary centred on restoration to office of the illegally sacked Chief Justice of Pakistan, Chief Justice Chaudhary and 60 other judges by General Musharraf.
Pakistan’s present crisis was a foregone conclusion when viewed in the context of political manoeuvres undertaken by the Pakistan Army with United States blessings to install a political novice and politically discredited Zardari as President of Pakistan without clipping the Presidents powers left as a legacy by General Musharraf as military ruler.
Politically, the net effect in Pakistan has been that despite the return of parliamentary democracy in Pakistan in 2008, Zardari installed as President in September 2008, exercised powers of a President as in a presidential form of democratic governance.
Pakistan’s democracy was grudgingly conceded by the Pakistan Army, ostensibly under United States pressures in the face of massive street demonstrations in 2007-2008, but it was adulterated democracy that had returned.
Once again, the United States in pursuit of tactical expediency rather than long term strategic vision, stood on the wrong side of history in Pakistan’s evolving political dynamics. The United States has continued to over-invest in the Pakistan Army rather than in favor of Pakistani peoples-centric policies.
Political crises are endemic in Pakistan’s political dynamics as a result of the fragility of Pakistan’s political structures that were never allowed to become strong by the vested political interventions of the Pakistan Army and the strategic interests of Pakistan Army’s external patrons.
Astutely observed, Michael Krepon of the Washington think tank Stimson Center made the following observations on Pakistan(1)Political crises in Pakistan have periodically surfaced (2)Crises were created by policies of the Pakistan Army and its military rulers (3) Crises not solved by the Pakistani creators of crises (4) Pakistan’s political crises were solved only with the creators of the crisis being made to exit the political scene.
President Zardari’s forced exit from the office of the President may solve the present crisis. Notwithstanding the eventuality what it leaves in its wake for the United States are serious policy and strategic dilemmas.
The United States policy and strategic predicaments in Pakistan stood consistently analyzed by this Author in the following SAAG Papers commencing with SAAG Paper No. 812 dated 07/10/2003 entitled “US Policy Predicaments in Pakistan” and resting with SAAG Paper No. 3055 dated 17/02/2009 entitled “United States Imperatives to “Reset” Pakistan Policy."
This Paper once again attempts to review United States policy and strategic dilemmas in Pakistan in the contemporary context under the following heads:
United States Predicaments in Pakistan as Viewed in 2003
United States Policyand Strategic Dilemmas in March 2009
United States Fixatious Mindsets on Pakistan: Imperatives for Reorientation
United States Predicaments in Pakistan as Viewed in 2003
The following observations made in this Author’s 2003 SAAG Paper quoted above are pertinent today too and pertinent with a vengeance:
“Pakistan once again presents policy predicaments to United States policy makers. The United States today is facing an Islamic onslaught and Pakistan is the most untrustworthy candidate to combat it on America’s behalf having been the spearhead of Islamic Jihad for over a decade.”
“Further, Pakistan itself is divided by internal strife endangering the future of this militarized nation state.”
“Therefore, the United States options in Pakistan today are limited and basic.”
After surveying the perceptional schisms in the United States between the US Administration and American think tanks this Author set out and analysed three policy options available to USA “keeping in mind the prospects of military coup, civil war and fragmentation of Pakistan”, The Three Options analysed were as under:
Option I Stable General Musharraf
Option II Stable Pakistan Army
Option III Stable Democratic Pakistan Nation State
These options basically centered on the means to achieve stability in Pakistan. It was also asserted that these three Options could not be considered as synonymous as they carried separate implications for both Pakistan and the United States.
Readers can study the first two Options in the SAAG Paper referred, but one would like to concentrate on Option III i.e. ‘Stable and Democratic Pakistan’, which was analysed as “It entails that a political climate is engineered in Pakistan by the United States which could ensure the following:
“Pakistan Army's role in the political and foreign affairs of Pakistan be marginalized and Pakistan Army is forced to return to the barracks.”
“Restoration of Parliamentary (not presidential) democracy in Pakistan in elections initially to be conducted in presence of foreign observers to pre-empt rigging by Pakistan Army and its ISI”
“Pakistan Army be made subservient to the Parliamentary System.”
“De-jehadisation of Pakistan as an essential pre-condition for economic aid from international donors and foreign investments”
The following assertions were made in Option III analysis:
“A democratic Pakistan in full civilian control, however disorderly to begin with, due to prolonged spells of Pakistan Army misrule, will be at peace with itself, peace with its South Asian neighbours and more amenable to United States advice and directions.”
“If historical precedents are to go by, then the United States would find it very difficult to adopt Option III, unless Cold War mindsets are changed in the civil and military bureaucracies in Washington. For them it is easy to deal with military rulers of Pakistan.”
“Yet, it is imperative that the United States adopts Option III for its own long term good in terms of its political standing and strategic interests in South Asia.”
Six years down the line, Option III remained unadopted by the United States. The United States engineered the return of democracy in 2008 but not in unadulterated form and the Pakistan Army while not in direct control continues to exercise quasi-political control over Pakistan’s polity.
United States and Strategic Dilemmas in March 2009
As on 15 March 2009, at the time of writing this Paper, Pakistan for all practical purposes is in the grip of a serious violent confrontation between President Zardari and the Opposition parties led by Muslim League (N) leader, former twice Prime Minister Nawaz Sharif.
The visuals from Pakistan indicate massive protest demonstrations on the streets of Pakistan, moreso in the majority province of Pakistan. The massive size of peoples demonstrations has surprised even former PM Nawaz Sharif spearheading the movement for restoration of the 1973 Constitution, restoration of the independent Supreme Court judiciary and repeal of the NRO which would unseat President Zardari and enable prosecution of General Musharraf.
Buoyed by the size of peoples demonstrations in his support former PM Nawaz Sharif has now refused any dialogue with President Zardari.
Somebody has to blink and here once again one recalls Nuchael Krepon’s observations at the beginning of this Paper, that Pakistani crises were only solved by the exit of the initiator of the crisis.
Since President Zardari has initiated the present political crisis by his broken pledges and manipulating judicial verdicts against his political opponents by his packed courts he is the most likely to be forced by the Pakistan Army and the United States to exit the political scene. The United States can ill ignore the massive Pakistan’s peoples outpouring on the streets of Pakistan in favor of Nawaz Sharif.
The major policy and strategic dilemmas to the United States in the developing situation in Pakistan where former PM Nawaz Sharif emerges in power are as follows:
Can the United States effectively re-calibrate its policies to adjust and engage with a strong Punjabi Prime Minister of Pakistan?
One can additionally ask here a question and that is if the United States has an over-reliance on the Pakistan Army which is predominantly Punjabi dominated in all echelons, than why is the United States chary of having Punjabi Prime Ministers at the helm of Pakistan?
Former PM Nawaz Sharif is most likely to reattempt bringing Pakistan Army under firm civilian political control. In that eventuality can the United States prevail over the Pakistan Army not to indulge once again in military coup as it did in 1999?
The Pakistan Army as it is has not contributed effectively to control Taliban onslaughts against US & NATO Forces in Afghanistan. A US-restrained Pakistan Army may just stand aloof from supporting operations in Afghanistan in the ensuing scenario. Is the United States prepared to deal with such a contingency or once again succumb to Pakistan Army pressures that USA has no other alternative but to submit to Pakistan Army’s preferences?
Does the United States have the political will to disconnect the Pakistan Army from its foreign policy formulations and strategic blueprint in South Asia?
Is the United States ready to release itself from existing mindsets within its policy establishment and recalibrate and reorient its policies with an overriding priority on Pakistan’s emergence as a stable democracy?
These are major policy challenges for the United States policy establishment and no current indicators are available even against the backdrop of the evolving explosive situation in Pakistan that United States is ready for a major re-orientation in its Pakistan policy other than band-aid solutions.
United States Fixatious Mindsets on Pakistan: Imperatives for Reorientation
This Author, over the years, analyzing United States policy directions in Pakistan has always stood intrigued by the following manifestations:
United States officialdoms fixatious mindsets that Pakistan has a critical role to play in the US global strategic blueprint
Pakistan is a “frontline state” protecting US strategic interests in the region
United States official ‘lionizing’ of the Pakistan Army and bestowing billions of US dollars to strengthen its combat effectiveness. In real terms it continues to reinforcing Pakistan Army’s military adventurism.
Schisms exist between the above manifestations of the US policy establishment under different political dispensations and the think-tanks in Washington, the US media and the US academia on the other hand.
The US think-tanks come out with realistic assessments and well substantiated too on Pakistan’s lack of strategic utility to US national security interests and these were at variance with what the official policy establishment pursues in its formulations.
One in intrigued as to how such worthwhile assessments from prestigious Washington think-tanks are not translated or incorporated into US official policies on Pakistan.
Such official mindsets in the United States, more reminiscent of Cold wwolicy determinations, are no longer valid in the evolving global political and strategic milieu. Such mindsets have distorted US policies in South Asia to the detriment of the US national security interests.
United States prevailing policy mindsets have led to (1) Pakistan being encouraged to box much above its political and strategic weight (2) Pakistan’s nuclear weaponisation and WMD proliferation (3) Pakistan Army emerging as the leading proponent. and facilitator of global Islamic Jihad.
The Obama Administration in the pursuit of giving a new look to United States foreign policy would be well advised to “reset” its Pakistan policy as argued in this Author’s Paper: “United States Imperatives to Reset Pakistan Policy "(SAAG Paper No. 3055 dated 17 Feb. 2009).
The American over-reliance on the Pakistan Army to dictate terms and determine Pakistan’s political dynamics requires re-orientation with a priority investment by USA on Pakistan emerging as a strong and stable democracy.
The latest news flowing in from Pakistan is that President Zardari has blinked under United States pressures and US pressures applied through the Pakistan Army to defuse the crisis. President Zardari has agreed to re-install Chief Justice Chaudhary as Chief Justice of Pakistan and so also the 60 other judges deposed by General Musharraf.
This is only, the first step towards defusing the ongoing Pakistan’s political crisis. It needs to be watched whether the 17th Amendment is abolished and so also Governor’s rule on Punjab set aside.
All this proves that while Pakistan relies on China for strategic and military sustenance, it is the United States which has a controlling influence on Pakistan’s political dynamics.
If that be so, then other than tactical expediencies, nothing holds back the United States to ensure the return of unadulterated democracy to Pakistan.
The United States main strategic interests in Pakistan can be enumerated as under (1) Pakistan continues as a strategic base for US & NATO Forces operations in Afghanistan (2) Pakistan’s badlands of FATA do not spawn another 9/11 terrorist attack on USA (3) Nuclear terrorism (4) WMD proliferation by Pakistan.
A stable and democratic civilian government in Islamabad with the Pakistan Army under firm civilian political control ensured by the United States would be better placed in the long run to serve US national security and strategic interests.
If the Obama Administration sincerely believes in its catchy slogan “Yes, we can” then in relation to Pakistan, it should be the top most priority to ensure a “Stable and Democratic Pakistan”. The US President has to ensure that this message percolates down to the civil and military bureaucracies in Washington.
Concluding Observations
The United States has for more than 60 years stood on the wrong side of history in Pakistan. Its support of Pakistan’s military regimes and civilian dictators has brought about a cumulative effect where Pakistan’s very existence as a nation-state has been made fragile and where anti-Americanism is the predominant mood in the masses.
Commencing in March 2007 and repeated now in March 2009, the massive turnout of Pakistanis on the streets in protest demonstrations is a reminder that they demand a complete transformation of Pakistan’s governance and political set up. Pakistanis predominantly want unadulterated democracy, human rights and liberal political institutions.
For the United States it is a major and critical policy dilemma as to whether it has the will to forsake the Pakistan Army as its instrument to further its strategic interests in South Asia and foster uninhibited democracy in Pakistan. It has yet to give any indications to this effect.
(The author is an International Relations and Strategic Affairs analyst. He is the Consultant, Strategic Affairs with South Asia Analysis Group. Email:drsubhashkapila.007@gmail.com)
Al Qaeda & Balochistan: Kidnapping Of US National
By B. Raman
On February 2, 2009, John Solecki, an American national and head of the office of the United Nations High Commission for Refugees (UNHCR) in Balochistan, was kidnapped in Quetta and his driver shot dead. A hitherto unknown organisation calling itself the Balochistan Liberation United Front (BLUF) subsequently claimed responsibility for the kidnapping and demanded the release of 141 Baloch women and several thousand Baloch males, alleged to be in the custody of the Pakistani intelligence agencies. Till now, Solecki has not been traced by the Pakistani security forces, who do not seem to have any idea of the organisation behind the kidnapping.
2.The Pakistani authorities have denied having such a large number of Balochs, including women, in their custody. Baloch nationalist elements, who have been fighting for the independence of their homeland, have also strongly denied any responsibility for the kidnapping. They suspect that the kidnapping had been orchestrated by the Inter-Services Intelligence (ISI) through the Afghan or Pakistani Taliban for discrediting their freedom struggle by projecting the Baloch freedom-fighters as terrorists. The leadership of the Afghan Taliban headed by its Amir Mulla Mohammad Omar, operates from sanctuaries in the Pashtun majority areas of Balochistan.
3.The Baloch freedom-fighters totally disapprove of the ideology of the Taliban and Al Qaeda and their anti-US policies. In fact, they feel that the US could help them in their freedom struggle and try to maintain good interactions with governmental and non-governmental elements in the US. It is, therefore, very unlikely that the Baloch freedom-fighters----either in Pakistan or in the Baloch majority areas of Iran--- would kidnap or harm an American national. John Solecki was quite popular among the Balochs of Balochistan.
4. In its past messages, Al Qaeda had always projected the Punjabis and the Pashtuns as participants in its global jihad against the Crusaders and the Jewish people. It had never projected the Sindhis, the Mohajirs and the Balochs as forming part of its global jihad. In a significant departure from this practice, an audio message of Ayman al-Zawahiri, the No.2 of Al Qaeda, disseminated on February 22, 2009, refers to the Balochs also as participants in the global jihad. It appeals to the Arabs of Saudi Arabia and Yemen to emulate the Pashtuns and the Balochs of Pakistan in stepping up the jihad against the rulers of these two countries.
5. It says: " I call on the noble and defiant tribes of the Yemen and tell them--- don't be less than your brothers in the defiant Pashtun and Baluch tribes, who aided Allah and His Messenger and made America and the Crusaders dizzy in Afghanistan and Pakistan.Your brothers from the defiant Pashtun and Baluch tribes are making the Crusaders taste woe after woe and are sending thousands of their lions to jihad in Afghanistan under the banner of Mullah Mohammad Omar Mujahid and are disciplining the treasonous Pakistani Army, making it taste defeat after defeat and forcing it to make pacts with them in order to save itself from their violence and they are severing the supply route of the Crusaders from Pakistan to Afghanistan."
6. Zawahiri's reference to some members of Baluch tribes fighting in Afghanistan against the Americans under the banner of the Afghan Taliban and the kidnapping of the American UN official indicate the possibility that that BLUF might be an organisation of Afghan, Pakistani and Iranian Balochs , who are sought to be used by the Taliban and Al Qaeda in their fight against the US-led NATO troops in Afghanistan. This needs further enquiry.
(The writer is Additional Secretary (retd), Cabinet Secretariat, Govt. of India, New Delhi, and, presently, Director, Institute For Topical Studies, Chennai. E-mail: seventyone2@gmail.com )
On February 2, 2009, John Solecki, an American national and head of the office of the United Nations High Commission for Refugees (UNHCR) in Balochistan, was kidnapped in Quetta and his driver shot dead. A hitherto unknown organisation calling itself the Balochistan Liberation United Front (BLUF) subsequently claimed responsibility for the kidnapping and demanded the release of 141 Baloch women and several thousand Baloch males, alleged to be in the custody of the Pakistani intelligence agencies. Till now, Solecki has not been traced by the Pakistani security forces, who do not seem to have any idea of the organisation behind the kidnapping.
2.The Pakistani authorities have denied having such a large number of Balochs, including women, in their custody. Baloch nationalist elements, who have been fighting for the independence of their homeland, have also strongly denied any responsibility for the kidnapping. They suspect that the kidnapping had been orchestrated by the Inter-Services Intelligence (ISI) through the Afghan or Pakistani Taliban for discrediting their freedom struggle by projecting the Baloch freedom-fighters as terrorists. The leadership of the Afghan Taliban headed by its Amir Mulla Mohammad Omar, operates from sanctuaries in the Pashtun majority areas of Balochistan.
3.The Baloch freedom-fighters totally disapprove of the ideology of the Taliban and Al Qaeda and their anti-US policies. In fact, they feel that the US could help them in their freedom struggle and try to maintain good interactions with governmental and non-governmental elements in the US. It is, therefore, very unlikely that the Baloch freedom-fighters----either in Pakistan or in the Baloch majority areas of Iran--- would kidnap or harm an American national. John Solecki was quite popular among the Balochs of Balochistan.
4. In its past messages, Al Qaeda had always projected the Punjabis and the Pashtuns as participants in its global jihad against the Crusaders and the Jewish people. It had never projected the Sindhis, the Mohajirs and the Balochs as forming part of its global jihad. In a significant departure from this practice, an audio message of Ayman al-Zawahiri, the No.2 of Al Qaeda, disseminated on February 22, 2009, refers to the Balochs also as participants in the global jihad. It appeals to the Arabs of Saudi Arabia and Yemen to emulate the Pashtuns and the Balochs of Pakistan in stepping up the jihad against the rulers of these two countries.
5. It says: " I call on the noble and defiant tribes of the Yemen and tell them--- don't be less than your brothers in the defiant Pashtun and Baluch tribes, who aided Allah and His Messenger and made America and the Crusaders dizzy in Afghanistan and Pakistan.Your brothers from the defiant Pashtun and Baluch tribes are making the Crusaders taste woe after woe and are sending thousands of their lions to jihad in Afghanistan under the banner of Mullah Mohammad Omar Mujahid and are disciplining the treasonous Pakistani Army, making it taste defeat after defeat and forcing it to make pacts with them in order to save itself from their violence and they are severing the supply route of the Crusaders from Pakistan to Afghanistan."
6. Zawahiri's reference to some members of Baluch tribes fighting in Afghanistan against the Americans under the banner of the Afghan Taliban and the kidnapping of the American UN official indicate the possibility that that BLUF might be an organisation of Afghan, Pakistani and Iranian Balochs , who are sought to be used by the Taliban and Al Qaeda in their fight against the US-led NATO troops in Afghanistan. This needs further enquiry.
(The writer is Additional Secretary (retd), Cabinet Secretariat, Govt. of India, New Delhi, and, presently, Director, Institute For Topical Studies, Chennai. E-mail: seventyone2@gmail.com )
March 15, 2009
Voice of America curbs freedom
The Pioneer , India
WebLink : http://www.dailypioneer.com/162464/Voice-of-America-curbs-freedom.html
Kanchan Gupta
There is a pattern to the waxing and waning of American hubris. What begins as a shock-and-awe show of power through the unrestrained use of overwhelming force invariably ends with a pathetic whimper. We have seen this happen in Vietnam where a futile war was waged to nobody’s benefit; a war that shall forever be remembered for two indelible images: Nick Ut’s Pulitzer Prize winning photograph of a nine-year-old girl screaming in agony after being scalded by napalm and helicopters evacuating soldiers, officials and collaborators from the US Embassy hours before the fall of Saigon in 1975. The war in Vietnam (and before that in Korea) was meant to contain the spread of communism; it was part of a grand strategy based on the ‘domino theory’, which later turned out to be as spurious as the ‘holy war’ the Americans funded to force Soviet troops out of Afghanistan in the 1980s.
Once that task was accomplished, the homegrown Afghan mujahideen reinvented themselves as the Taliban while the Arab ‘holy warriors’ led by Osama bin Laden laid the foundation and built the base — what we now know as Al Qaeda — to launch a global jihad targeting ‘enemies’ of Islam. Borrowing heavily from Islamic traditions and texts, they created a lexicon of terror, incorporating words, phrases and expressions that have over the years come to represent their dark thoughts and darker deeds. In doing so, the Taliban and Al Qaeda were merely following in the footsteps of the original protagonists of radical Islamism. Let’s not forget that it was Hasan al-Banna who gave a political edge to Islam by coining the slogan, “Islam is the solution.” Syed Qutb used that slogan to fashion Islamism as a political ideology which became the creed of the Ikhwan-ul-Muslimeen or the Muslim Brotherhood. The Ikhwan’s members and supporters wear their faith on their sleeves; one of its offshoots, Hamas — an acronym for Harkat al-Muqwamat al-Islamiyyah, or ‘Islamic Resistance Movement’ — uses the Shahadah as the emblem on its flag.
Neither the Ikhwan nor Al Qaeda, or for that matter the Taliban and the neo-Islamists who are on the ascendent in many Muslim countries, would resent the association of faith with their violent actions. Some may resort to sophistry, but the bulk harshly assert that what others view as terrorism is entirely justified from their perspective. For evidence, recall the crude e-mail sent out by the ‘Indian Mujahideen’ owning up responsibility for the ghastly bombings in Jaipur, Ahmedabad and Delhi. From Bali to New York, the killers of innocent people see themselves as serving the cause of Islam. When the Taliban orders girls to stay at home and not attend school, it insists that the decree is in accordance with shari’ah. For President Mahmoud Ahmadinejad, calling for the destruction of Israel is a profound expression of his faith and identity.
But we are told not to associate terrorism and its attendant violence with Islam. The Jamiat Ulama-i-Hind touts a fatwa issued by Darul Uloom Deoband which purportedly denounces terrorism as ‘un-Islamic’. What it forgets to mention is that the practitioners of terrorism, most notably members of the Taliban, the Lashkar-e-Tayyeba and the Jaish-e-Mohammed, are products of Deobandi madarsas. It is equally ironical that Sheikh Ahmed Yassin, who almost single-handedly set up Hamas, was a product of Al Azhar. Had theological sophists who so glibly seek to absolve terrorists of their crimes and paint fanatics as no more than devout Muslims been sincere in separating faith from violence, as they demand of others, then Mohammed Atta would not have flown an aircraft into the World Trade Center, nor would Ajmal Ameer Kasab be nicknamed the ‘Butcher of Mumbai’.
Yet, great offence is pretended to references to jihadi terrorism, Islamic fanaticism and radical Islamism. We are told that this hurts Muslim sensitivities and belittles a great faith. The argument is not without merit, but it is absurd to suggest that criticism of radical Islamism or Islamic fanaticism, which fuel jihadi terrorism, amounts to Islamophobia and hate speech, as has been decided by the Organisation of Islamic Conference, just as it is ridiculous to interpret the war on terror as a war against Islam. Strangely, we are witnessing abject capitulation instead of resistance to this concerted effort to suppress free speech so as to gloss over horrendous atrocities. What is distressing is that the capitulation is more pronounced in those countries which till now have fiercely protected free speech as an inalienable right without which no society can be open and democratic.
This is where the waning of American hubris that waxed in the aftermath of 9/11 comes in. With Mr George Bush’s grand strategy in Afghanistan all but discarded by President Barack Hussein Obama who proposes to pursue a policy of grand bargain and strike a deal with the ‘moderate’ Taliban, which is an oxymoron, efforts are on to enforce an official code that redefines the war on terror as an engagement with militancy! What began as the US Department of Homeland Security counselling “caution in using terms such as, ‘jihadist’, ‘Islamic terrorist’, ‘Islamist’, and ‘holy warrior’ as grandiose descriptions” has now begun to evolve into what can and cannot be said in public discourse. This is best exemplified by a memo sent out to staffers by Jennifer Janin, the head of Voice of America’s Urdu service, informing them that the “editors & I have come up with the following guidelines on usage of words & phrases related to terrorism & violence”:
“Islamic terrorists: DO NOT USE. Instead use simply: terrorist... Sometimes even the names of the accused themselves point to the identity, and there is no need to specify.” So, VOA will not, for instance, mention the name of Ajmal Ameer Kasab while reporting on the Mumbai terror attack.
“Terrorism/ terrorist: AVOID OVERUSE. Listeners get tired... Militant, militancy, violent etc can be used descriptively as appropriate.” In conformity with this guideline, a VOA report would say, ‘Violence in Mumbai on November 26, 2008, left 173 people dead and 308 wounded.’
“Islamic Fundamentalism/ Muslim Fundamentalists: AVOID... The use of such expressions, more exclusively in case of Muslims, adds to existing misgivings in the Islamic world of an anti-Muslim sentiment ... better to use ‘conservative’... ”. VOA report from Swat: ‘Conservative’ Muslims have decreed that girls can’t attend school and victims of rape will be stoned to death.
“Islamist: NOT NECESSARY... Muslims perceive that it has been ‘intentionally’ rhymed with ‘Fascist’, ‘Communist’ or ‘Anarchist’... We just don’t need this short cut in our reporting.” Short cut? Am I missing out on something?
kanchangupta@rocketmail.com
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Obama will be happy
By Hindustani on 3/15/2009 11:26:12 PM
Barack Hussein Obama listens to Voice of America. He will be happy to know VOA is singing his tune and whitewashing Islamic terrorism crime. Doordarshan tells Government lies. VOA also tells lies to help US Administration. So it is same telling of lies to push politics and not expose truth. It is shameful. But what to do?
US will do anything
By Ravi on 3/15/2009 11:14:03 PM
Past events show Americans are master at game of switching positions. After all Saddam Hussein was a 'friend' of America and Donald Rumsfeld had praised him on many occasion. During Iran-Iraq war. American backed Iraq against Islamic Republic of Iran. But when Saddam refused to toe American line, he became enemy of America. Iraq was invaded and Saddam hanged. Americans gave Iran nuclear technology. Now when Iran is making bomb, US is crying foul. Lesson is, don't trust Americans.
voice
By raj on 3/15/2009 10:13:53 PM
The US / West know that the only people to kick around without any response are Hindu indians.They rightly believe that hindus are masochists who love being kicked around & the indian netas who are corrupt thugs portray the nation as one of slaves.Hope Chinese will take over that pathetic slumdog country.Atleast it will then have nuclear protection by chinese arsenal.After all the hindus just want to live & not die.It does not matter who rules them.
WebLink : http://www.dailypioneer.com/162464/Voice-of-America-curbs-freedom.html
Kanchan Gupta
There is a pattern to the waxing and waning of American hubris. What begins as a shock-and-awe show of power through the unrestrained use of overwhelming force invariably ends with a pathetic whimper. We have seen this happen in Vietnam where a futile war was waged to nobody’s benefit; a war that shall forever be remembered for two indelible images: Nick Ut’s Pulitzer Prize winning photograph of a nine-year-old girl screaming in agony after being scalded by napalm and helicopters evacuating soldiers, officials and collaborators from the US Embassy hours before the fall of Saigon in 1975. The war in Vietnam (and before that in Korea) was meant to contain the spread of communism; it was part of a grand strategy based on the ‘domino theory’, which later turned out to be as spurious as the ‘holy war’ the Americans funded to force Soviet troops out of Afghanistan in the 1980s.
Once that task was accomplished, the homegrown Afghan mujahideen reinvented themselves as the Taliban while the Arab ‘holy warriors’ led by Osama bin Laden laid the foundation and built the base — what we now know as Al Qaeda — to launch a global jihad targeting ‘enemies’ of Islam. Borrowing heavily from Islamic traditions and texts, they created a lexicon of terror, incorporating words, phrases and expressions that have over the years come to represent their dark thoughts and darker deeds. In doing so, the Taliban and Al Qaeda were merely following in the footsteps of the original protagonists of radical Islamism. Let’s not forget that it was Hasan al-Banna who gave a political edge to Islam by coining the slogan, “Islam is the solution.” Syed Qutb used that slogan to fashion Islamism as a political ideology which became the creed of the Ikhwan-ul-Muslimeen or the Muslim Brotherhood. The Ikhwan’s members and supporters wear their faith on their sleeves; one of its offshoots, Hamas — an acronym for Harkat al-Muqwamat al-Islamiyyah, or ‘Islamic Resistance Movement’ — uses the Shahadah as the emblem on its flag.
Neither the Ikhwan nor Al Qaeda, or for that matter the Taliban and the neo-Islamists who are on the ascendent in many Muslim countries, would resent the association of faith with their violent actions. Some may resort to sophistry, but the bulk harshly assert that what others view as terrorism is entirely justified from their perspective. For evidence, recall the crude e-mail sent out by the ‘Indian Mujahideen’ owning up responsibility for the ghastly bombings in Jaipur, Ahmedabad and Delhi. From Bali to New York, the killers of innocent people see themselves as serving the cause of Islam. When the Taliban orders girls to stay at home and not attend school, it insists that the decree is in accordance with shari’ah. For President Mahmoud Ahmadinejad, calling for the destruction of Israel is a profound expression of his faith and identity.
But we are told not to associate terrorism and its attendant violence with Islam. The Jamiat Ulama-i-Hind touts a fatwa issued by Darul Uloom Deoband which purportedly denounces terrorism as ‘un-Islamic’. What it forgets to mention is that the practitioners of terrorism, most notably members of the Taliban, the Lashkar-e-Tayyeba and the Jaish-e-Mohammed, are products of Deobandi madarsas. It is equally ironical that Sheikh Ahmed Yassin, who almost single-handedly set up Hamas, was a product of Al Azhar. Had theological sophists who so glibly seek to absolve terrorists of their crimes and paint fanatics as no more than devout Muslims been sincere in separating faith from violence, as they demand of others, then Mohammed Atta would not have flown an aircraft into the World Trade Center, nor would Ajmal Ameer Kasab be nicknamed the ‘Butcher of Mumbai’.
Yet, great offence is pretended to references to jihadi terrorism, Islamic fanaticism and radical Islamism. We are told that this hurts Muslim sensitivities and belittles a great faith. The argument is not without merit, but it is absurd to suggest that criticism of radical Islamism or Islamic fanaticism, which fuel jihadi terrorism, amounts to Islamophobia and hate speech, as has been decided by the Organisation of Islamic Conference, just as it is ridiculous to interpret the war on terror as a war against Islam. Strangely, we are witnessing abject capitulation instead of resistance to this concerted effort to suppress free speech so as to gloss over horrendous atrocities. What is distressing is that the capitulation is more pronounced in those countries which till now have fiercely protected free speech as an inalienable right without which no society can be open and democratic.
This is where the waning of American hubris that waxed in the aftermath of 9/11 comes in. With Mr George Bush’s grand strategy in Afghanistan all but discarded by President Barack Hussein Obama who proposes to pursue a policy of grand bargain and strike a deal with the ‘moderate’ Taliban, which is an oxymoron, efforts are on to enforce an official code that redefines the war on terror as an engagement with militancy! What began as the US Department of Homeland Security counselling “caution in using terms such as, ‘jihadist’, ‘Islamic terrorist’, ‘Islamist’, and ‘holy warrior’ as grandiose descriptions” has now begun to evolve into what can and cannot be said in public discourse. This is best exemplified by a memo sent out to staffers by Jennifer Janin, the head of Voice of America’s Urdu service, informing them that the “editors & I have come up with the following guidelines on usage of words & phrases related to terrorism & violence”:
“Islamic terrorists: DO NOT USE. Instead use simply: terrorist... Sometimes even the names of the accused themselves point to the identity, and there is no need to specify.” So, VOA will not, for instance, mention the name of Ajmal Ameer Kasab while reporting on the Mumbai terror attack.
“Terrorism/ terrorist: AVOID OVERUSE. Listeners get tired... Militant, militancy, violent etc can be used descriptively as appropriate.” In conformity with this guideline, a VOA report would say, ‘Violence in Mumbai on November 26, 2008, left 173 people dead and 308 wounded.’
“Islamic Fundamentalism/ Muslim Fundamentalists: AVOID... The use of such expressions, more exclusively in case of Muslims, adds to existing misgivings in the Islamic world of an anti-Muslim sentiment ... better to use ‘conservative’... ”. VOA report from Swat: ‘Conservative’ Muslims have decreed that girls can’t attend school and victims of rape will be stoned to death.
“Islamist: NOT NECESSARY... Muslims perceive that it has been ‘intentionally’ rhymed with ‘Fascist’, ‘Communist’ or ‘Anarchist’... We just don’t need this short cut in our reporting.” Short cut? Am I missing out on something?
kanchangupta@rocketmail.com
--------------------------------------------------------------------------------
Email | Print | Rate: 12345
--------------------------------------------------------------------------------
Post Comment
COMMENTS BOARD ::
--------------------------------------------------------------------------------
Obama will be happy
By Hindustani on 3/15/2009 11:26:12 PM
Barack Hussein Obama listens to Voice of America. He will be happy to know VOA is singing his tune and whitewashing Islamic terrorism crime. Doordarshan tells Government lies. VOA also tells lies to help US Administration. So it is same telling of lies to push politics and not expose truth. It is shameful. But what to do?
US will do anything
By Ravi on 3/15/2009 11:14:03 PM
Past events show Americans are master at game of switching positions. After all Saddam Hussein was a 'friend' of America and Donald Rumsfeld had praised him on many occasion. During Iran-Iraq war. American backed Iraq against Islamic Republic of Iran. But when Saddam refused to toe American line, he became enemy of America. Iraq was invaded and Saddam hanged. Americans gave Iran nuclear technology. Now when Iran is making bomb, US is crying foul. Lesson is, don't trust Americans.
voice
By raj on 3/15/2009 10:13:53 PM
The US / West know that the only people to kick around without any response are Hindu indians.They rightly believe that hindus are masochists who love being kicked around & the indian netas who are corrupt thugs portray the nation as one of slaves.Hope Chinese will take over that pathetic slumdog country.Atleast it will then have nuclear protection by chinese arsenal.After all the hindus just want to live & not die.It does not matter who rules them.
China-US spat a drop in the ocean
Asia Times Online
By Jian Junbo
HONG KONG - Tensions over a China-United States naval standoff in the South China Sea seem to be rising, with the US sending an armed destroyer to escort the US Navy surveillance ship which was confronted by Chinese vessels near Hainan Island last weekend.
But analysts say the incident will not severely dent Sino-US relations, unlike a similar standoff after Chinese and US military aircraft collided over the same island in 2001. Both countries are keen on maintaining close ties in the face of the global financial crisis and observers expect the controversy to blow over.
The incident is more an indication of the growing capabilities of China's military to safeguard its national interests in the South
China Sea and elsewhere - a reality the US now needs to deal with, whether it likes it or not.
On Sunday, the Pentagon accused China of harassing the Impeccable, an unarmed sub-hunting ship, claiming it was operating legally in international waters about 120 kilometers off Hainan, China's southernmost province. Hainan is the site of a Chinese submarine base and other naval installations.
The Pentagon has said that the Chinese ships included a Chinese Navy intelligence collection ship, a Bureau of Maritime Fisheries Patrol Vessel, a State Oceanographic Administration patrol vessel and two small Chinese-flagged trawlers.
Chinese Foreign Ministry spokesman Ma Zhaoxi responded on Tuesday saying the US's claims were "gravely in contravention of the facts ... and totally unacceptable to China". He told reporters in Beijing that the Impeccable had "conducted activities in China's exclusive economic zone in the South China Sea without China's permission".
The next day, China's Defense Ministry urged the US to prevent any reoccurrence of the confrontation. Ministry spokesman Huang Xueping said the US navy vessel had violated Chinese and international laws such as the 1982 United Nations convention on the Law of the Sea - which China has signed but the US has not.
"China conducts normal activities of law enforcement in its own exclusive economic zone to defend its rights and interests, and such activities are justified and lawful," he said.
Although the US and other countries consider most of the South China Sea to be international waters, China claims an exclusive economic zone extending 200 nautical miles from its coastlines. International law allows non-hostile activities by foreign ships in a country's exclusive economic zone - so at heart of the controversy is China's claim that the activities of the Impeccable were indeed hostile.
Pentagon officials have said the Impeccable was looking for threats such as submarines and was towing a sonar apparatus which scans for submarines, mines and torpedoes, according to media reports. With its numerous Chinese military installations, Hainan offers rich hunting grounds for such surveillance; of particular interest is the new submarine base near Hainan's resort city of Sanya, which is home to the Chinese navy's most sophisticated craft.
It is clear that Chinese vessels confronted the US surveillance ship because it thought it was violating Chinese sovereignty, making the standoff similar in some ways to the air collision eight years ago over Hainan Island.
On April 1, 2001 a US ARIES II signals surveillance aircraft was intercepted by two Chinese J-8II fighter jets about 110 kilometers from the island. One of the Chinese fighters began making close passes to the US aircraft, and on its third collided with it, slicing the J-8 in half and killing its pilot. The crippled US aircraft was forced to make an emergency landing at a Chinese military airport in Hainan, with the fallout from the incident resulting in a tense 11-day standoff between China and the US over the return of the aircraft and its crew.
Despite Beijing's toughly-worded protests this time around, Chinese Foreign Minister Yang Jiechi and US Secretary of State Hillary Clinton met behind closed doors on Wednesday in Washington and agreed to reduce tensions and avoid a repeat of the incident. But neither side yielded in their conflicting versions of the incident, and the United States is not giving in to China's demands that it cease naval surveillance. On Thursday, a Pentagon official said the US had sent the USS Chung-Hoon, a heavily armed destroyer, to escort the Impeccable.
With tensions high, US President Barack Obama met Yang in the Oval Office on Thursday and stressed the need for more frequent communication to avoid future military confrontations as they could upset a bilateral relationship which is crucial to solving global crises, the Associated Press reported. "Confrontation hurts both sides," Yang said later in a speech at the Center for Strategic and International Studies, a think-tank. The two countries, he said, should "shelve differences" that cannot be immediately resolved and focus on cooperation.
It is likely the incident will be brought up in the first meeting between President Hu Jintao and Obama at the Group of 20 summit in London next month.
Clearly, this is not the first time for the US navy has conducted surveillance in that area of the South China Sea, as the Pentagon said the Impeccable was conducting "routine" operations. However, this is perhaps the first time that the Chinese have tried to stop American operations there. The incident suggests the Chinese military's tolerance of US naval spy operations near its coast is increasingly wearing thin.
This change reflects the reality of China's increasingly aggressive military stance in the South China Sea. After three decades of reform, China has grown much stronger militarily and it has the confidence to safeguard its national interests. Last week, the Chinese government announced its defense budget would increase by nearly 15% this year, despite the economic slump.
In the past, security issues in the South China Sea were seen as too remote to reach the top agenda of Chinese leaders or to be of concern to the Chinese public. But now there is growing concern in China over the country's interests there, including the Nansha (Spratly) islands.
While China and Taiwan claim Nansha, neighboring countries such as the Philippines, Vietnam and Malaysia also claim sovereignty over and occupy several of the the islands' reefs. (See Buffer benefits in Spratly initiative, Asia Times Online, February 22, 2008.)
Malaysian Prime Minister Abdullah Badawi on March 5 landed on one controversial reef, known as Layang Layang or Swallow's Reef, declaring his county's sovereignty over it. His act prompted many Chinese netizens to express indignation over what they called "a foreign occupation", with their outcry putting pressure on the government over the sovereignty issue.
So the naval clash with the US could also be seen as signal from the government that it has not only the will but also the capability to protect its would-be national interests on the South China Sea. It could also be a message of legitimacy before the public, and to possibly broaden the international space for the country's economic development in future.
China's dispatch of a small naval fleet to the Gulf of Aden off Somalia to protect Chinese cargo ships against modern-day pirates last month demonstrated that the Chinese navy has expanded from an off-shore defense force to a "blue water" navy. The Chinese military now openly talks about the possibility of building aircraft carriers.
In face of these new realities, the US perhaps has to adapt and readjust its policy of so-called "routine" spying operations off the coasts of China. What would the US say if one day in future Chinese naval spy ships were found off the coasts of the United States?
While it is certain that some more skirmishes and conflicts between these two powers will occur, they are unlikely to develop into serious conflicts, at least not in the foreseeable future. The two countries now have too many common interests and cannot afford a breakdown in relations. The US needs Chinese money to help its ailing economic and financial system - China is now the US's largest creditor - and China still needs the US in its drive for modernization.
It may take a long time for the US to adapt itself to the reality of the swift rise and military modernization of China, as the US is not used to facing challenges in its so-called traditional sphere of influence - the Asia-Pacific. But now, it should take note that China is no longer willing to always comply with America's dominance in the region. Times have changed.
In the long run, the US will need China to tackle important global issues, such as energy, protection of the environment, terrorism and reform of the international financial system. And if the US wants to continue policing the world, it should respect China's national interests in the South China Sea. Nonetheless, the incident is unlikely to shake the sound foundations of Sino-US relations, and is certainly not expected to wreck the good diplomatic atmosphere built up since Hillary Clinton's friendly visit to China last month.
Dr Jian Junbo, an assistant professor at Institute of International Studies, Fudan University, China, is now a visiting scholar at the University of Hong Kong's Centre of Asian Studies.
(Copyright 2009 Asia Times Online (Holdings) Ltd. All rights reserved. Please contact us about sales, syndication and republishing.)
By Jian Junbo
HONG KONG - Tensions over a China-United States naval standoff in the South China Sea seem to be rising, with the US sending an armed destroyer to escort the US Navy surveillance ship which was confronted by Chinese vessels near Hainan Island last weekend.
But analysts say the incident will not severely dent Sino-US relations, unlike a similar standoff after Chinese and US military aircraft collided over the same island in 2001. Both countries are keen on maintaining close ties in the face of the global financial crisis and observers expect the controversy to blow over.
The incident is more an indication of the growing capabilities of China's military to safeguard its national interests in the South
China Sea and elsewhere - a reality the US now needs to deal with, whether it likes it or not.
On Sunday, the Pentagon accused China of harassing the Impeccable, an unarmed sub-hunting ship, claiming it was operating legally in international waters about 120 kilometers off Hainan, China's southernmost province. Hainan is the site of a Chinese submarine base and other naval installations.
The Pentagon has said that the Chinese ships included a Chinese Navy intelligence collection ship, a Bureau of Maritime Fisheries Patrol Vessel, a State Oceanographic Administration patrol vessel and two small Chinese-flagged trawlers.
Chinese Foreign Ministry spokesman Ma Zhaoxi responded on Tuesday saying the US's claims were "gravely in contravention of the facts ... and totally unacceptable to China". He told reporters in Beijing that the Impeccable had "conducted activities in China's exclusive economic zone in the South China Sea without China's permission".
The next day, China's Defense Ministry urged the US to prevent any reoccurrence of the confrontation. Ministry spokesman Huang Xueping said the US navy vessel had violated Chinese and international laws such as the 1982 United Nations convention on the Law of the Sea - which China has signed but the US has not.
"China conducts normal activities of law enforcement in its own exclusive economic zone to defend its rights and interests, and such activities are justified and lawful," he said.
Although the US and other countries consider most of the South China Sea to be international waters, China claims an exclusive economic zone extending 200 nautical miles from its coastlines. International law allows non-hostile activities by foreign ships in a country's exclusive economic zone - so at heart of the controversy is China's claim that the activities of the Impeccable were indeed hostile.
Pentagon officials have said the Impeccable was looking for threats such as submarines and was towing a sonar apparatus which scans for submarines, mines and torpedoes, according to media reports. With its numerous Chinese military installations, Hainan offers rich hunting grounds for such surveillance; of particular interest is the new submarine base near Hainan's resort city of Sanya, which is home to the Chinese navy's most sophisticated craft.
It is clear that Chinese vessels confronted the US surveillance ship because it thought it was violating Chinese sovereignty, making the standoff similar in some ways to the air collision eight years ago over Hainan Island.
On April 1, 2001 a US ARIES II signals surveillance aircraft was intercepted by two Chinese J-8II fighter jets about 110 kilometers from the island. One of the Chinese fighters began making close passes to the US aircraft, and on its third collided with it, slicing the J-8 in half and killing its pilot. The crippled US aircraft was forced to make an emergency landing at a Chinese military airport in Hainan, with the fallout from the incident resulting in a tense 11-day standoff between China and the US over the return of the aircraft and its crew.
Despite Beijing's toughly-worded protests this time around, Chinese Foreign Minister Yang Jiechi and US Secretary of State Hillary Clinton met behind closed doors on Wednesday in Washington and agreed to reduce tensions and avoid a repeat of the incident. But neither side yielded in their conflicting versions of the incident, and the United States is not giving in to China's demands that it cease naval surveillance. On Thursday, a Pentagon official said the US had sent the USS Chung-Hoon, a heavily armed destroyer, to escort the Impeccable.
With tensions high, US President Barack Obama met Yang in the Oval Office on Thursday and stressed the need for more frequent communication to avoid future military confrontations as they could upset a bilateral relationship which is crucial to solving global crises, the Associated Press reported. "Confrontation hurts both sides," Yang said later in a speech at the Center for Strategic and International Studies, a think-tank. The two countries, he said, should "shelve differences" that cannot be immediately resolved and focus on cooperation.
It is likely the incident will be brought up in the first meeting between President Hu Jintao and Obama at the Group of 20 summit in London next month.
Clearly, this is not the first time for the US navy has conducted surveillance in that area of the South China Sea, as the Pentagon said the Impeccable was conducting "routine" operations. However, this is perhaps the first time that the Chinese have tried to stop American operations there. The incident suggests the Chinese military's tolerance of US naval spy operations near its coast is increasingly wearing thin.
This change reflects the reality of China's increasingly aggressive military stance in the South China Sea. After three decades of reform, China has grown much stronger militarily and it has the confidence to safeguard its national interests. Last week, the Chinese government announced its defense budget would increase by nearly 15% this year, despite the economic slump.
In the past, security issues in the South China Sea were seen as too remote to reach the top agenda of Chinese leaders or to be of concern to the Chinese public. But now there is growing concern in China over the country's interests there, including the Nansha (Spratly) islands.
While China and Taiwan claim Nansha, neighboring countries such as the Philippines, Vietnam and Malaysia also claim sovereignty over and occupy several of the the islands' reefs. (See Buffer benefits in Spratly initiative, Asia Times Online, February 22, 2008.)
Malaysian Prime Minister Abdullah Badawi on March 5 landed on one controversial reef, known as Layang Layang or Swallow's Reef, declaring his county's sovereignty over it. His act prompted many Chinese netizens to express indignation over what they called "a foreign occupation", with their outcry putting pressure on the government over the sovereignty issue.
So the naval clash with the US could also be seen as signal from the government that it has not only the will but also the capability to protect its would-be national interests on the South China Sea. It could also be a message of legitimacy before the public, and to possibly broaden the international space for the country's economic development in future.
China's dispatch of a small naval fleet to the Gulf of Aden off Somalia to protect Chinese cargo ships against modern-day pirates last month demonstrated that the Chinese navy has expanded from an off-shore defense force to a "blue water" navy. The Chinese military now openly talks about the possibility of building aircraft carriers.
In face of these new realities, the US perhaps has to adapt and readjust its policy of so-called "routine" spying operations off the coasts of China. What would the US say if one day in future Chinese naval spy ships were found off the coasts of the United States?
While it is certain that some more skirmishes and conflicts between these two powers will occur, they are unlikely to develop into serious conflicts, at least not in the foreseeable future. The two countries now have too many common interests and cannot afford a breakdown in relations. The US needs Chinese money to help its ailing economic and financial system - China is now the US's largest creditor - and China still needs the US in its drive for modernization.
It may take a long time for the US to adapt itself to the reality of the swift rise and military modernization of China, as the US is not used to facing challenges in its so-called traditional sphere of influence - the Asia-Pacific. But now, it should take note that China is no longer willing to always comply with America's dominance in the region. Times have changed.
In the long run, the US will need China to tackle important global issues, such as energy, protection of the environment, terrorism and reform of the international financial system. And if the US wants to continue policing the world, it should respect China's national interests in the South China Sea. Nonetheless, the incident is unlikely to shake the sound foundations of Sino-US relations, and is certainly not expected to wreck the good diplomatic atmosphere built up since Hillary Clinton's friendly visit to China last month.
Dr Jian Junbo, an assistant professor at Institute of International Studies, Fudan University, China, is now a visiting scholar at the University of Hong Kong's Centre of Asian Studies.
(Copyright 2009 Asia Times Online (Holdings) Ltd. All rights reserved. Please contact us about sales, syndication and republishing.)
Toward a globalized Asia
Source: Japan Times Online
Weblink: http://search.japantimes.co.jp/cgi-bin/eo20090310ko.html
By KAZUO OGOURA
As a result of globalization, intellectual frameworks and paradigms for forming cultural policies are shifting, especially regarding cultural activity in international contexts.
First, because cultural activity can now be diffused more quickly and widely across the border. As a result, culture, as part of a process of reconfirming and reaffirming identity, has become less geographically attached, and national and ethnic cultures are bound to be redefined.
Second, with innovations in technology and the spread of information technology, barriers and boundaries between different forms of art are being broken — for example, between fine arts and cinema, dance and theater and even between photographs and sculpture.
Third, the emphasis on facts and figures and on efficiency in today's society, combined with a growing popularization of culture, has brought a focus on the social significance of artistic activity. This has changed the relationship between artistic and other forms of social activity.
Of these three aspects of change, it is, from the Asian perspective, the first trend — namely, the borderless nature of artistic activity — that is the most relevant. In Asia, globalization and the process of redefining national culture are, despite some similarities, unfolding in ways that are vastly different from Europe and the United States.
Globalization has given Asia sudden exposure, thrusting it into the global arena and bringing up a pressing issue: how Asia will express itself in an international framework. This has provoked a redefinition of "Asian values," and a move toward forming an Asian community.
Simultaneously, we are seeing a "nationalization" of cultural activity, particularly in Korea and China, which is strengthening national identity. The Korean and Chinese governments are becoming intensely focused on transmitting their traditions and cultures and increasing their cultural presence across the globe. In Tokyo's Shinjuku area, a Korean cultural institute, larger than the Japan Foundation headquarters building nearby, is under construction. China, as part of a "Year of China in France" several years ago, organized a large-scale festival, in which all of Paris was awash with Chinese art.
In Japan, although not indifferent to promoting Japanese culture overseas, the government's involvement in cultural activity is dwindling in comparison to areas such as the environment and welfare. Government funding for the Japan Foundation, for instance, is decreasing by approximately 2 to 3 percent each year.
In the private sector, Japanese businesses are active patrons of art and culture as part of their CSR (corporate social responsibility) mission. However, regarding cultural activities overseas, their support leans toward "universal" (for example, classical, Western music) projects or local, community-oriented contributions and away from more "Japanese" activities.
"Japanese" cultural and educational programs such as research projects on Japan or Japanese language education, with the exception of some areas of Asia, do not particularly attract multinational Japanese companies who are patrons of art and culture.
What we see in the Korean and Chinese context on the one hand, and in the Japanese context on the other, represent two opposing currents emerging in East Asia. This has produced two reactions in Japan: (1) the "national" argument for challenging the Korean and Chinese states' cultural nationalism with a similar move; and (2) the more "global" thought that culture should be universal in its ultimate aim — in which case, the loss of some "Japanese-ness" is a necessary compromise along the way.
Although, at first glance, these reactions seem to represent two contradictory camps, they can coexist. If we look at the works of Haruki Murakami, or Japanese manga, anime, fashion or otaku culture, their global appeal is not so much the result of successfully promoting Japanese culture; rather, they are examples of super-modern Japanese cultural phenomena that has appealed to a younger generation around the world and has become a shared context for expressing their sensibilities.
If we shift the angle of view slightly, another effect of globalization on Japan could be that the very concept of Japanese "uniqueness" has become "globalized." To take Japanese architecture as an example, a popular theory used to be that its uniqueness (Japanese-ness) was epitomized in the shape of the roof or certain distinct "forms" of Japanese architecture.
But today the prominent theory is that the spirit or principle of Japanese architecture — namely, the concept of flexible division of space — should be considered as the essence of all modern architecture: What seemed before to be an exception is now seen as universal.
Perhaps, through the very pursuit and expression of its uniqueness, Japan is closer to finding a global perspective. Asia, through a similar process, might move beyond its region and become a global "Asia."
Kazuo Ogoura, a political science professor at Aoyama Gakuin University, is president of the Japan Foundation.
Weblink: http://search.japantimes.co.jp/cgi-bin/eo20090310ko.html
By KAZUO OGOURA
As a result of globalization, intellectual frameworks and paradigms for forming cultural policies are shifting, especially regarding cultural activity in international contexts.
First, because cultural activity can now be diffused more quickly and widely across the border. As a result, culture, as part of a process of reconfirming and reaffirming identity, has become less geographically attached, and national and ethnic cultures are bound to be redefined.
Second, with innovations in technology and the spread of information technology, barriers and boundaries between different forms of art are being broken — for example, between fine arts and cinema, dance and theater and even between photographs and sculpture.
Third, the emphasis on facts and figures and on efficiency in today's society, combined with a growing popularization of culture, has brought a focus on the social significance of artistic activity. This has changed the relationship between artistic and other forms of social activity.
Of these three aspects of change, it is, from the Asian perspective, the first trend — namely, the borderless nature of artistic activity — that is the most relevant. In Asia, globalization and the process of redefining national culture are, despite some similarities, unfolding in ways that are vastly different from Europe and the United States.
Globalization has given Asia sudden exposure, thrusting it into the global arena and bringing up a pressing issue: how Asia will express itself in an international framework. This has provoked a redefinition of "Asian values," and a move toward forming an Asian community.
Simultaneously, we are seeing a "nationalization" of cultural activity, particularly in Korea and China, which is strengthening national identity. The Korean and Chinese governments are becoming intensely focused on transmitting their traditions and cultures and increasing their cultural presence across the globe. In Tokyo's Shinjuku area, a Korean cultural institute, larger than the Japan Foundation headquarters building nearby, is under construction. China, as part of a "Year of China in France" several years ago, organized a large-scale festival, in which all of Paris was awash with Chinese art.
In Japan, although not indifferent to promoting Japanese culture overseas, the government's involvement in cultural activity is dwindling in comparison to areas such as the environment and welfare. Government funding for the Japan Foundation, for instance, is decreasing by approximately 2 to 3 percent each year.
In the private sector, Japanese businesses are active patrons of art and culture as part of their CSR (corporate social responsibility) mission. However, regarding cultural activities overseas, their support leans toward "universal" (for example, classical, Western music) projects or local, community-oriented contributions and away from more "Japanese" activities.
"Japanese" cultural and educational programs such as research projects on Japan or Japanese language education, with the exception of some areas of Asia, do not particularly attract multinational Japanese companies who are patrons of art and culture.
What we see in the Korean and Chinese context on the one hand, and in the Japanese context on the other, represent two opposing currents emerging in East Asia. This has produced two reactions in Japan: (1) the "national" argument for challenging the Korean and Chinese states' cultural nationalism with a similar move; and (2) the more "global" thought that culture should be universal in its ultimate aim — in which case, the loss of some "Japanese-ness" is a necessary compromise along the way.
Although, at first glance, these reactions seem to represent two contradictory camps, they can coexist. If we look at the works of Haruki Murakami, or Japanese manga, anime, fashion or otaku culture, their global appeal is not so much the result of successfully promoting Japanese culture; rather, they are examples of super-modern Japanese cultural phenomena that has appealed to a younger generation around the world and has become a shared context for expressing their sensibilities.
If we shift the angle of view slightly, another effect of globalization on Japan could be that the very concept of Japanese "uniqueness" has become "globalized." To take Japanese architecture as an example, a popular theory used to be that its uniqueness (Japanese-ness) was epitomized in the shape of the roof or certain distinct "forms" of Japanese architecture.
But today the prominent theory is that the spirit or principle of Japanese architecture — namely, the concept of flexible division of space — should be considered as the essence of all modern architecture: What seemed before to be an exception is now seen as universal.
Perhaps, through the very pursuit and expression of its uniqueness, Japan is closer to finding a global perspective. Asia, through a similar process, might move beyond its region and become a global "Asia."
Kazuo Ogoura, a political science professor at Aoyama Gakuin University, is president of the Japan Foundation.
Mr.Modi alleges misappropriation of Rs 50,000 crore by UPA govt.
Pune (PTI): Gujarat Chief Minister Narendra Modi on Sunday night alleged that a CAG report has found a huge sum of Rs 50,000 crore unaccounted for and "missing" from the 'Central government coffers'.
"The country wants to know from Prime Minster Manmohan Singh about this money that has simply vanished," Mr.Modi, who launched the election campaign of BJP-Shiv Sena alliance in Maharashtra from the city, said.
Training guns on Singh, Mr.Modi said the country should know whether the huge sum of "missing" money purportedly mentioned in the CAG report was being used for "election purposes" by the ruling party or handed over to some "preferred NGOs".
"Daal me kuch kala hai" (There is something fishy about this), he charged.
Targeting the prime minister, whom he described as a reputed economist, Mr.Modi alleged it was intriguing that the Harshad Mehta stock scam had happened when Singh was the Finance Minister in the Narsimha Rao government.
"Today, when he is Prime Minister, the 'Satyam' fiasco has surfaced. Why such things are happening when he is at the helm? Is it the result of his economic policies or something else," Mr.Modi asked addressing a large gathering.
The BJP leader also accused Singh of backtracking on the building of national road network infrastructure that was started by Atal Bihari Vajpayee during NDA rule.
In a scathing attack on Congress-led UPA, Mr.Modi alleged it had failed to deliver on all fronts including "security and development" and with the revoking of POTA, had compromised on the fight against terrorism.
"POTA revocation led to celebrations in Pakistan and agony in Hindustan," he claimed.
He said Congress was practising votebank politics.
On Mumbai terror attacks, Mr.Modi alleged it was a pity that ministers were making trips to complain to the US about it and exhibiting dossier containing television clips and reports.
"Terrorism should be retaliated in the same manner. Instead of the US, India should have entered Pakistan to give a befitting reply," he claimed.
Mr.Modi said the presence of Taliban in Karachi posed direct threat to Mumbai. He also blamed the Congress government for the Naxalite menace. He charged the failure of India's foreign policy led to the rise of Maoists in Nepal.
Mr.Modi charged that the UPA could not contain spiralling prices and unemployment and appealed to the people to vote BJP to power to shape the country's destiny under the leadership of L K Advani.
At the outset, Mr.Modi who is in charge of BJP affairs in Maharashtra, congratulated the Shiv Sena and BJP leaders for keeping the "yuti" (saffron alliance) intact to fight the elections unitedly. "I am happy that Sena supremo Bal Thackeray's health has stabilised and we have his blessings," he added.
Those who addressed the gathering included BJP leaders Gopinath Munde and Nitin Gadkari.
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