Quote of the Day: K P S Gill

"If the Maoists are to be defeated, the state and its agencies will have to develop a detailed understanding of their strategies, tactics and underlying ideology. Such an understanding is now conspicuous by its absence, with the notable exception of the police leadership in Andhra Pradesh and a few officers in the intelligence establishment."

-- K P S Gill

Improving Intellipedia (YouTube.com)

US$147/B One Year On : Political Winners and Strategic Losers

This paper examines the political implications of oil prices as high as $147/b in 2008 or as low as $33/b in 2009 on oil producing countries. After a five-year bull run from 2004-2008 oil producers became used to high receipts cementing support at home while buying influence abroad. Thus the political demise of producer regimes was expected to follow the sharp 2009 drop in prices. But amid a sustained economic crisis, the author argues, political resilience became the leitmotif of producer states. He concludes that, with prices and resource nationalism set to rise in tandem, the political impetus could shift back to producers once more, but unless lessons are learned from 2008-2009, all states will lose out.

© 2009 Center for Security Studies (CSS), ETH Zurich

Download: English (PDF · 4 pages · 491 KB)
Author: Matthew Hulbert
Series: CSS Analyses in Security Policy
Issue: 58
Publisher: Center for Security Studies (CSS), Zurich, Switzerland

Russian Hardliners' Military Doctrine: In Their Own Words

May 30, 1996
Russian Hardliners' Military Doctrine: In Their Own Words
by Cohen, Ariel
FYI #104

SOURCE: http://www.heritage.org/research/russiaandeurasia/fyi104.cfm

(Archived document, may contain errors)


No. 104 May30,1996

RUSSIAN HARDLINERS9 MILITARY DOCTRINE: IN THEIR OWN WORDS

By Ariel Cohen, Ph.D. Senior Policy Analyst

INTRODUCTION

Some Western leaders and policyrnakers are remarkably unconcerned about the prospects of a vic- tory by Communist Party candidate Gennady Zyuganov in the Russian presidential elections on June 16. Thinking that a communist return to power in Russia will be no different than it was in Po- land or Slovakia, these Westerners appear to believe that a communist victory in Russia will not dis- rupt the burgeoning "partnership" between Russia and the West. However, the report translated here paints a different picture. Written by hard-line members of a nationalist-communist coalition that supports Zyuganov for president but maintains close ties with such nationalists as Vladimir Zhirinovsky, the document contains advice for Russian military plan- ners that is profoundly disturbing for the United States and the West. No amount of "miffor imag- ing" in the U.S. or Western democracies can obscure the meaning of Russian hardliners as rendered in their own words.

Among the report's main points: X Russia should be moving aggressively to adopt a nuclear deterrence posture for perceived non- nuclear threats. Strategic nuclear forces should be the highest priority. X Russia should be able to fight at least one full-scale regional war, one smaller-scale conflict, and at least three "peacemaking" operations outside its borders. X The U.S. and NATO remain Russia's enemies. Other foes include Turkey and countries of the former Soviet Union such as the Baltic States. X Russia's armed forces should be drastically reorganized on the basis of smaller, highly mobile units. X Russia should be prepared to undertake military operations to reconquer the New Independent States (NIS) of the former Soviet Union. These operations would include seizing conimand-and- control sites, "eliminating" the political-military leadership, and deporting "some categories" of the hostile population, presumably to the Russian hinterland.


The authors of these positions are analysts who advise the president and the Russian General Staff on military and security matters. One author is Lieutenant General Valeriy Dementyev, who was once Deputy Chief of Armaments in the USSR Ministry of defense, and today is an analyst with the Institute for Defense Research (known by its Russian acronym INOBIS, Institut oboronnykh issle- dovaniz) in the town of Kaliningrad, on the Baltic Sea near the Polish border. The other author is An- ton Surikov, a defense analyst formerly associated with the USA-Canada Institute and also an analyst at the Institute for Defense Research. The secretive INOBIS is financed by the Russian Gen- eral Staff, military-industrial enterprises, and the Atomic Energy Ministry, and conducts classified research. It was founded by senior figures from the KGB and the Russian military-industrial com- plex. Also instrumental in its founding was Yuri Maslyukov, Zyuganov's chief economic policy maker and the former head of the USSR's Central Planning Authority (the all-powerful GosPlan). INOBIS reportedly enjoys an attentive audience at the Ministry of Defense. People like Surikov and Dementyev advise Communist Party leader Zyuganov, radical nationalist Zhirinovsky, and President Boris Yeltsin's Atomic Energy Minister, Viktor Mikhailov. Even if Zyuganov loses the presidential elections, the views expressed in this report will influence Russian military and security policy. Many in the Russian armed forces and security services support a more aggressive stance for Russia-a viewpoint clearly expressed in this document.
The Heritage Foundation thanks Harriet and Bill Scott, leading experts on the Soviet and Russian military, for their kind assistance in translating this report.

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ARMY REFORM AND SECURITY: Conceptual Theses of the Strategy of Reforming The Armed Forces of the Russian Federation

by Valerly Dernentyev, Lieutenant General (Ret.) and Doctor of Technical Sciences, and Anton Surikov, Doctor of Technical Sciences

Deterrence and Defense

The defensive character of the policy of the Russian Federation (RF) in the military area and the absence in Russia of aggressive intentions was proclaimed in the Basic Provisions of the Military Doctrine of the RF, unveiled in 1993.1 This thesis, however, is in need of clarification in terms of the precise tasks that the Armed Forces face. Among them, first of all, three basic tasks should be singled out: V The Armed Forces must have the capability to deter effectively the threat of nuclear attack on Russia and on the countries of the Commonwealth of Independent States (CIS), which have signed the agreement on collective security. In this, the talk is exclusively about deterrence, be- cause national military thought acknowledges the impossibility of victory in a global nuclear conflict on the strategic level. V The Armed Forces should be aimed both at deterring a large-scale military attack on Russia and the CIS by foreign governments or a coalition thereof using conventional armaments, and deter- ring and repelling military aggression from the outside that has more limited goals. Deterrence of such threats can be nuclear. The Armed Forces must have the capability to conduct local wars and carry out peacemaking op- erations, primarily within the bounds of the former USSR, taking into account that the former Soviet Union is a zone of Russian vital interests and home to 25 million ethnic Russians. Cur- rently, the Russian Federation is conducting two local wars on the territory of the former USSR -in Chechnya and Tajikistan. Besides that, the Armed Forces of the Russian Federation are ful- filling peacemaking functions that are in fact deterring Georgia and Moldova from commencing aggression towards Abkhazia, South Ossetia, and Trans-Dniester.2 Taking into account the prac- tices of 1990-1996, the demand must be put forward, in part, for the capability to wage local wars within the bounds of the former USSR. The Armed Forces should be able to take part si- multaneously in at least one local war of high intensity, at least one "slow" local war, and at least three "frozen" local conflicts and peacemaking operations.

Russia's Enemies

The thesis of the Basic Provisions is that Russia has no outside enemies. Experience has demon- strated the falseness of this thesis. Because of Russia's weak government and the progressive degra- dation of its military and economic potential, outside enemies are making themselves known in a bolder and more open fashion.

1 This is a declassified version of Russia's official military doctrine, adopted after the army helped Boris Yeltsin to crush the rebellion at the Supreme Soviet in October 1993 [editor's note]. 2 Abkhazia and South Ossetia are integral parts of Georgia, while Trans-Dniester is a part of Moldova [editor's note).
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Currently, Russia's basic probable enemies remain the United States and the NATO countries. The United States has a vast nuclear missile potential which, if used, can destroy Russia as a state. It was created with the goal of nuclear blackmail of the USSR and was oriented mainly at carrying out a first nuclear strike. At present, in spite of ongoing reductions within the framework of START 1, orientation toward a first strike not only has not disappeared, but actually has been increased. This is due primarily to the policy of the [American] authorities, particularly the U.S. Congress, toward re- vision of the ABM Treaty of 1972 and creates the prerequisites for development and subsequent de- ployment of a strategic ABM system by the year 2003. In contrast to the Warsaw Pact Treaty Organization, not only has NATO, led by the USA, not been dissolved, but the decision already has been made to enlarge it. NATO's infrastructure, despite the reduction of personnel and armaments taking place under the Conventional Forces in Europe Treaty, is still oriented toward actions in an eastern direction. The preservation of its basic military infrastructure gives it an opportunity to build up its troops quickly should such a decision be made. Although, as of today, the potential of NATO conventional forces is not sufficient to conduct a large-scale offensive operation against the Russian Federation similar to Hitler's invasion of 1941, over time these forces can be augmented and advanced to the borders of the Russian Federation. In this light, the plans for NATO eastern expansion look clearly aggressive. Moreover, in Poland, the Czech Republic, and Hungary measures are now being taken to adapt the infrastructure, airport net- work, communications, etc., for NATO use. One Hungarian airport, without prior permission, has been turned into an American military base. It should be noted that the experience of the U.S. and NATO in the Persian Gulf in 199 1, and in the former Yugoslavia in 1995-1996, demonstrates that the tWestem] bloc today has sufficient po- tential to carry out military operations with limited goals on the periphery of post-Soviet territory. In this scenario, the greatest danger is presented by aggression from three possible directions: first, because of Norway's recent decision to expand NATO military activity in the north of the country, from the north against the Russian Federation's Northern Fleet on the Kola peninsula; second, in connection with the discussion about creating a 60,000-strong Baltic Corps from German, Danish, and Polish detachments, from the northwest in the form of military intervention by NATO in case of a conflict between Russia and the Baltic countries; and third, in light of the calls being heard to grant the countries of the Caspian basin NATO security guarantees similar to those given to the countries of the Persian Gulf, from the south, where the key role is assigned to a member of NATO -Turkey. Turkey possesses an army of 600,000. Its navy is already bigger than the Russian Black Sea Fleet. Turkey has unilaterally altered the status of the Black Sea straits, threatening Russia's interests. It has voiced numerous military threats toward Russia's ally Armenia with regard to the conflict in Nagorno-Karabakh. Turkey is attempting to attract into its sphere of influence the Turkish-speaking and Muslim regions of the former USSR. It has been proven that Turkish officials supported [Presi- dent] Dudaev's illegal military detachments in Chechnya. They also assisted the "Gray Wolves" or- ganization in Azerbaijan and a number of other nationalistic military detachments throughout the cis.

Japan, which is an ally of the United States and has territorial claims against the Russian Federa- tion, might also be considered a potential enemy of Russia. Today, Japan does not have sufficient military power to start an aggressive military operation against Russia in order to take the islands of the Southern Kurils by force, but it does have the necessary potential to expand its Armed Forces quickly.
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China and Iran Are Not Enemies

Obviously, the fact that Russia and China are neighbors must not be ignored when planning the development of the Armed Forces. At the same time, the military policy of the Russian Federation should be formed with extreme caution with respect to China. The U.S., seeing China as a potential enemy, is interested in creating a military confrontation between Russia and China. Similarly, the U.S. has a clear interest in the confrontation between the Russian Federation and Iran, another American enemy. The "Islamic threat" to the CIS is used as an argument to promote a similar confrontation. After a close examination of this problem, however, it becomes clear that the extremist movements in the CIS that operate under pseudo-Islamic slogans are relying as a rule not on Iran, but on pro-Western regimes in the Muslim world: Turkey, Pakistan, and Saudi Arabia. In light of the above, it is not practical to view Iran and China as probable enemies of Russia, at least in the near future, because there are no objective causes for confrontation between the Russian Federation and those countries.

Recreating the Empire Within the territory of post-Soviet Russia, the main enemies are the forces of aggressive national- ism that operate with support from outside and have armed forces of their own: an-nies, police, and other militarized detachments of the Baltic states; Dudayev's illegal armed forces; Tajik opposition illegal armed forces; and others. The main causes of conflict involving the Armed Forces of the Rus- sian Federation within the territory of the former USSR are the following: V Ethnic discord and genocide of national minorities. Examples of such conflicts where Russian Federation (USSR) Armed Forces were used, directly or indirectly, would be Trans-Dniester in 1992, the Prigorodniy region in Northern Ossetia at the end of 1992, Southern Ossetia in 199 1 - 1992, and Abkhazia in 1992-1993. In the near future, ethnic conflicts probably will have two major causes. First, as a result of the events of 199 1, Russians are a divided people. Therefore, their objective tendency to reunite will become stronger as time goes on. Second, in all former USSR countries, except for Belorus- sia and perhaps Ukraine, ethnic minorities are subjected to discrimination.3 This is most clearly evident in the Baltic countries where, with the encouragement of Western institutions, human rights violations based on ethnic origin are part of official policy. The Baltic countries seem to be the most potentially explosive in terms of the possibility of new areas of conflict that could involve the Russian Federation's Armed Forces. Attempts by nationalist forces to seize power by armed force or to hold power in some republic of the former USSR. Examples include TaJikistan in 1992-1996, Lithuania in January 199 1, Georgia during the winter of 1991-1992 and at the end of 1993, and Azerbaijan in January 1990 and the summer of 1993.

Territorial claims against the Russian Federation and illegal attempts to seize sea and inland water resources that belong to Russia. Up to now, direct Russian participation in such armed conflicts has been avoided. But it is not out of the question, particularly because of the Baku government's policy of annexing part of the Caspian Sea, an inland body of water the rights to which should be shared equally by all countries bordering the region. Another potential source of conflict is the part of the Baltic Sea area that belongs to Russia but is claimed by Lithuania. It

3 The old term "Belorussia" is used for what is now Belarus[editor's note].
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also is known that the ethnocratic regimes of Tallin and Riga are claiming a part of the Russian Federation's Northwestern territory. V The desire of certain forces in the former USSR, primarily in the Baltic countries, to become a part of the NATO alliance. In such cases, one cannot exclude preemptive use of force by the Armed Forces of the Russian Federation to stop decisively any practical steps that might be taken by armed nationalist detachments to implement their provocative plans.

Budget Priorities

Obviously, in the near term, reform of the Russian Federation's Armed Forces will be conducted under conditions of deep economic crisis. Thus, the decisive factor in choosing among possible re- forms will be that the budget for the Armed Forces and military-industrial complex is limited. One of the main requirements will be to minimize the country's budget for defense. This, in turn, means that the established practice of allocating funds equally among the existing branches of the Armed Forces will have to be abandoned. It is necessary to determine which programs are crucial to sustaining the Armed Forces' ability to accomplish their main objectives and guarantee their financing. At the same time, it is unavoidable that programs which do not have a high priority will have to be financed from the "leftovers" of the military budget. Despite the importance of the transition to a professional army in the near future, it will be impossible to avoid using the draft to raise manpower. The Armed Forces will have to be re- duced to 1.2 million servicemen.

The Main Deterrent. Strategic Nuclear Forces In resolving the task of nuclear deterrence on the strategic level, the basic role should be played by strategic nuclear forces and systems supporting their combat functioning. Without strategic nu- clear forces, Russia cannot exist as an independent, unified state. The task of sustaining them should be given the highest priority and should be fully financed. As of today, [Russia's] strategic nuclear forces face three major problems: X Degradation of strategic nuclear forces. This concerns primarily the naval component of the strategic nuclear forces, in which the scheduled maintenance of weapon systems is constantly be- ing violated and the operational strength of strategic nuclear submarines has gone down drasti- cally. Since 1990, not a single new strategic nuclear submarine has been launched; considering the life cycle of submarines in the naval strategic nuclear forces, this means they could disap- pear within 15 years. It is most important to finish the scientific research and test construction work needed to create strategic nuclear submarines of a new generation which will carry new ballistic missiles by the years 2000-2003, as well as to ensure that these strategic nuclear subma- rines are brought into service at the rate of 2-3 submarines every two years. X Absence of clarity regarding the quantitative framework within which it is planned to de- velop strategic nuclear forces. In 1994, START I was implemented. START Il was signed but is not yet ratified. With regard to the naval and aviation components of the strategic nuclear forces, the existence of uncertainty concerning the fate of the treaty does not affect seriously their future development. According to START II, the naval strategic nuclear forces can be armed with 1,750 warheads after 2003. Roughly the same quantity was to be allowed under START I. Aviation strategic nuclear forces, which historically have played a very insignificant role in the national nuclear triad, will have 93 heavy bombers with approximately 500 cruise missiles, including 19 Tu-95 heavy bombers and several dozen heavy bombers acquired in Ukraine by agreement. The production of additional heavy bombers is very costly and thus is hardly advisable.


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A more complex situation exists in units of the Strategic Rocket Forces (SRF). According to START II, which requires the liquidation of ICBMs with MIRV warheads, the SRF by the year 2003 can rely on approximately 1,000 single-warhead ICBMs. At present, there are 350 mobile SS-25s with single warheads, which are to be replaced in the next few years, as their useful life expires, by "Topol-M" ICBMs. According to the agreement, Russia will have 105 MIRVed ICBMs, which are to be "unloaded" until only one warhead each remains, and 90 single SS- 18 ICBMs placed into refitted silos. To support the START H quota for the number of warheads, Russia will have to form more than 10 additional divisions of mobile ICBMs with approxi- mately 500 "Topol-M" ICBMs by the year 2003-in other words, practically double the num- ber of mobile, single-warhead ICBMs. Another possible option is to build new silos for new ICBMs. Even with priority financing, it is very difficult for the SRF to do this within such a lim- ited time frame.

In general, the START H treaty is'rather paradoxical. It calls for quick liquidation of more than 200 MIRVed Russian ICBMs, part of which could still be used for another 4-5 years. At the same time, in order to maintain quantitative parity with the U.S., several hundred single-war- head ICBMs should be deployed, and possibly placed into newly built silos, even as some of the old silos are to be destroyed under START H. Note that the United States plans to go from START I to START II in a different fashion. It will eliminate only 50 "MX" missiles, 4 "Ohio" strategic nuclear submarines, and 28 heavy bombers with cruise missiles. The main cuts are to be accomplished by "unloading" the missiles and storing the warheads in special storage facili- ties. At any moment, this stockpile, which the United States emphatically refuses to destroy, might be put back into operation on U.S. missiles. As a result, taking into account the potential for "quick loading" of these missiles, the U.S. will surpass Russia by 1,000- 1,500 warheads. Russia's refusal to follow START II will bring onto the agenda the issue of supporting MIRVed ICBMs. Analysis proves that this problem can be solved in principle. Different options are available. For instance, additional SS- l8s can be purchased from Ukraine. Also, purely Rus- sian MIRVed ICBMs can be designed; a 120-ton liquid fueled missile with 10 warheads could be created in 3-5 years after the appropriate decision. In the next 5-7 years, 300 such missiles can be placed into existing silos. Given these facts, in spite of widespread misconceptions, spending for this project could be quite moderate. At the stage of scientific research and test con- struction work, the amount would be several percent less per year than the amount allocated to "rebuild" Chechnya in 1996. At the development stage, given that the warheads would be avail- able, production and installation of 300 of such missiles would be three times cheaper than the cost of constructing in the same period 500 "Topol-M" ICBMs. in their mobile version or in new silos, as discussed above in relation to START 111. X Flaws in the command and control structure of the strategic nuclear forces. It is pro- posed, within the framework of measures for development of the strategic nuclear forces, to de- sign in an organized manner a single, self-contained operational command and control system for all groupings of strategic nuclear forces, including support systems, based on the adn-iinistra- tive structure developed in the Strategic Rocket Forces. Practical implementation of this pro- posal could be achieved within a year after the appropriate decision is made. The main reasons such a step is necessary are the increased demands for combat readiness in the strategic nuclear forces, economy of means, and elimination of parallel structures. It would be advisable to trans- fer the Military Space Forces to the Strategic Rocket Forces to bring under their functional con- trol the Missile Attack Warning System, the Space Control System, the Moscow ABM System, and corresponding testing sites. The naval and aviation strategic nuclear forces (functionally left in the Navy and Air Forces, respectively) also should be transferred to the single operational command and control of the strategic nuclear forces.

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At the present time, several hundred thousand servicemen, a third of them officers, are per- forming their military service in groupings of the strategic nuclear forces. In the Strategic Rocket Forces, for all practical purposes, combat crews of officers carry out in practice 100 per- cent of the direct functional duties connected with exploitation of the weapons. As for the draft- ees, they primarily carTy out functions as guards and perform auxiliary tasks in supporting combat readiness, technical support, etc. A similar situation, as a whole, characterizes the other components of the strategic nuclear forces and their support systems. It is proposed that the ratio between professionals and conscripts be maintained in the future as well. Since the U.S. and NATO possess conventional forces and armaments potentially sufficient to conduct military operations with limited goals on the periphery of post-Soviet territory, it is nec- essary to provide for deterrence of such actions by the probable enemy. Currently, functions for deterring aggression from the most probable directions are given: ow In the north (the naval bases on the Kola peninsula), to forces of the Leningrad Military Dis- trict (MD) and Northern Fleet (NF). vw In the northwest, (the Baltic region), to forces of the Leningrad MD, Kaliningrad special re- gion, and forces of the Baltic Fleet. ew In the south (the Caucasus-Caspian region), to forces of the North Caucasus Military dis- trict; subunits of the Russian Armed Forces on bases in Gyumri and Yerevan (Armenia), Tbilisi and Ahalkalaki (Georgia), Batumi (Adjaria), and Gudauta (Abkhazia); forces of the Caspian Flotilla; and the Black Sea fleet. Analysis shows that the existing deterTence potential of the Russian Federation Armed Forces in these directions might be insufficient to deter aggressive action by the probable enemy. Strengthening these forces by carrying out a long-term buildup in the number of troops and ar- maments in regions of probable conflict could be hard to achieve economically. In light of this, as a priority task facing the Armed Forces, it is proposed to create, within a year after a decision is made, Operational-Tactical Deterrent Forces numbering about 10,000 servicemen. Opera- tional-Tactical Deterrent Forces could operate as a reserve of the Supreme High Command and, on a long-term basis, could assume the function of deterring the probable enemy from conduct- ing military operations with local goals. For this proposal to be implemented at the initial stage, it is suggested to supply the Opera- tional-Tactical Deterrent Forces with 10- 12 missile and aviation complexes equipped with con- ventional precision weapons from the Rocket Forces, Ground Forces, and Air Forces. These missile and aviation complexes, while remaining functionally a part of the Rocket Forces, Ground Forces, and Air Forces, and based deep within Russian territory during peacetime, would be subordinated operationally, through a Main Directorate of the General Staff specially created for these purposes, to the Supreme High Command of the Russian Armed Forces. Dur- ing a threatening period, Operational-Tactical Deterrent Forces, by decision of the Supreme High Command, could be redeployed to the region of possible conflict and aimed on especially important targets deep in the probable enemy's territory. In the event plans for the eastern expansion of NATO are realized or new directions of possi- ble aggression appear (for instance, the Southern Kuril Island), it would be expedient to increase the number of the Operational-Tactical Deterrent Forces' missile and aviation complexes to 30- 50 units. At the same time, units of missile artillery and aviation complexes could be armed with nuclear weapons. To demonstrate persuasively to a probable enemy the RF's determination to impede any NATO advancement into the territory of the former USSR, some Operational-Tacti- cal Deterrent Force units also could be moved up to the borders, particularly the Russian-Norwe- gian border; to Russian military bases in Armenia, Georgia, Adzharia, and Abkhazia; to the


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Kaliningrad special region; and into Belorussia, to which President A. G. Lukashenko has agreed in principle.

The Mobile Forces: Mainstay of the Russian Army It is advisable when waging local wars within the former USSR to give the main functions to spe- cial elite units: Mobile Forces of the Russian Federation Armed Forces, which also must have prior- ity designation. Not intended for participation in extended military conflicts, these units could be used on a short-term basis in holding actions and to repel aggression from abroad against Russia and the CIS using conventional weapons. They also could be designated for peacekeeping opera- tions under the aegis of CIS, as well as the UN and other international organizations. It is advisable to form Mobile Forces, up to 90,000 strong, based on Airborne troops and using some units of naval infantry, over a year after a corresponding decision is made. Functionally, naval infantry would stay under Navy command and would be transferred to operational Mobile Forces command only for the conduct of special operations. For five years after forming these Mobile Forces, it is suggested that recruitment be exclusively on a contract basis. After the process of turning them into a professional force is complete, Mobile Forces should be fully staffed and given all kinds of heavy armaments and equipment. Moreover, the number of naval infantry should be increased with the assistance of the Baltic Fleet, Black Sea Fleet, and Caspian Flotilla, which are located in potential conflict areas of the Caucasus and Baltic countries. Special attention should be paid to the creation of naval infantry in the Caspian region be- cause of the extremely high probability of conflict arising from the unresolved problem of the status of the Caspian shelf. It is important to equip Mobile Forces with military transport aviation (MTA), which will belong functionally to the Air Forces and be operationally subordinate to the Commander in Chief of the Air Forces but required to carry out orders of the Mobile Forces. The need for MTA aircraft desig- nated to move personnel and military equipment, including heavy military equipment, is estimated at 100 aircraft. Most of the aircraft in MTA available today are not functioning. Therefore, about 30- 40 additional aircraft should be brought into service because of the extreme importance of the tasks performed by the Mobile Forces. A typical special operation involving Mobile Forces and aimed at liberating a large area of the for- mer USSR from nationalists should be based on the following principles. The commander of the op- eration is appointed and should receive a legally valid order. The date and time of the operation then are set. A rigid system of unified command is established so that operational command over all util- ized forces, regardless of departmental subordination and affiliation, is concentrated in the hands of a single person. In the first stage, aviation, special military intelligence (GRU) forces, and special Federal Security Services (FSB) and Foreign Intelligence Service (SVR) groups carry out strikes for the purpose of destroying or seizing the most important enemy targets and eliminating the enemy's military and po- litical leadership. Then Mobile Forces, with the support of army and frontline aviation and naval forces, crush and eliminate enemy forces and take over their territory. After that, subunits of Ground Forces and Internal Troops of the Ministry of Internal Affairs, RF, preferably with some combat experience, move in. They establish control of the most crucial locations and carry out "cleansing" of the territory. Then, with the help of militia formed out of the pro-Russian part of the local population, they establish control over the territory and ensure the elimination of nationalists and deportation of some categories of citizens from certain locations. It should be emphasized that until the end of the special operation, local authorities are needed only insofar as they are useful in supporting military control over the territory.


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Winners and Losers

Military intelligence plays a most important role in achieving the main goals of the Armed Forces. Making the GRU (Main Intelligence Directorate) and its subunits and structures more effec- tive should be given the highest priority. To implement these proposals, half the personnel of the Armed Forces would have to go to the four most important components of the Armed Forces named above, which also should be given pri- ority in financing. Because the economic situation in the country is difficult, the other half of the Armed Forces would have to exist under tight financial limitations. The Navy is the most expensive of the Armed Forces. A differentiated approach is needed here. Naval strategic nuclear forces cannot be underfinanced. The situation is more complex with respect to providing for the combat stability of naval strategic nuclear forces. The system exists and should be preserved, but this does not require building large ships. Aircraft carriers are an exception, since two carriers each are needed in the Pacific Fleet and Northern Fleet to meet military goals. There are only two at present, and the country's economic situation does not allow for two more.

To provide for anti-submarine warfare in oceanic theaters of military operations (TVD), there are in service submarines and ships equipped with special arms. This equipment should be main- tained and ships and submarines currently under construction should be finished, but no new ones should be built for the time being. With respect to combating enemy aircraft carriers, there are no battle groups now in place. Our recommendation is to maintain the status quo and concentrate on retaining existing levels. With reference to landing support for naval infantry, the appropriate infrastructure was built 0 by the USSR. It is important not only to stop its destruction, but also to continue its develop- ment, since costs will not be high but will allow it to perform tasks of the Mobile Forces with great effectiveness. In protecting sea communications, special attention should be paid to protecting lines of com- munication with the Kaliningrad Special Region. At the same time, activities in the remote oce- anic regions should be limited. The existing system for the coastal defense of the Russian Federation should be supported and developed, since no big investments are needed here. Finally, it is necessary to abandon the tasks of combating transatlantic shipments of U.S. forces and combating the enemy's surface ships and submarines armed with cruise missiles. V There are two large groups in the Ground Forces today. One was deployed in the Far East Military District and Trans-Baikal Military District during the time of tense relations with China. In subsequent years, it was degraded less than other groups. Another large group was de- veloped for obvious reasons in the North Caucasus Military District. It is reasonable to continue to support these groups. For the North Caucasus Military District, this means confirn-dng the ex- ception of District units from the treaty on Conventional Forces Reductions in Europe at the May conference of participants. It is unacceptable that the issue of the North Caucasus Military District be linked with the proposal made by a number of countries that the numbers of Russian forces in the Kaliningrad Special Region be cut; in light of Poland's and the Baltic countries' plans to join NATO, the very fact that the issue of the Kaliningrad Special Region has come up seems both ambiguous and a provocation. A limited number of Ground Forces are located in the strategically important Leningrad and Moscow Military Districts. From the west, Moscow is covered by only two army divisions. As there is no danger of a large-scale invasion of Russia similar to the invasion of 1941, the development of forces to the west of Moscow should not be


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hurried. But in the event the Eastern European countries join NATO and the infrastructure for an invasion force appears, Russia will be forced to respond accordingly. One possible response might be to recreate the Belorussian Military District and deploy Ground Forces and frontal avia- tion of the Air Forces there. Also, since it currently is difficult for Russia to maintain parity with NATO in conventional weapons, the primary emphasis should be assigned to tactical nuclear deterrence of the threat of non-nuclear attack by NATO forces. This approach will require arming the Rocket Forces, Ground Forces, and frontal aviation of the Air Forces with nuclear weapons and will be much less expensive than providing a non-nuclear deterrent force for a non-nuclear invasion. In gen- eral, the present weakness of Russia dictates reliance on nuclear weapons, including tactical weapons. Today, the only possible way to deter NATO is through nuclear deterrence. At the same time, should the relationship between Russia and China change, the same approach can be used in Central Asia and the Far East. An important problem in the Ground Forces is revision of the list of units in military districts and the discovery of units which can be cut. It is advisable to limit the number of divisions to 30- 35, of which 15-20 could be manned with conscripts and work on combat readiness while the other 15, evenly spread around the country, would be cadre and would serve as a base in prepar- ing the mobilization reserve. At the same time, preparation of the mobilization reserve should be conducted within the Internal Troops of the Ministry of Internal Affairs (MVD) and Border Guards. V In units of the Air Forces, special attention should be concentrated on maintaining mili- tary transport, frontal aviation, and aviation of the strategic nuclear forces, which could be used by the Operational-Tactical Deterrent Forces and Mobile Forces, at the required level. A major task is preserving qualifications of flying personnel. The Air Defense of military districts should be given to the Air Forces from the Troops of Air Defense, disbanding the latter units but retaining their combat readiness requirements. The missile attack warning system, space control system, and Moscow ABM System, as well as their corresponding testing grounds, would be transferred to the Strategic Rocket Forces. The Air Defense system that is maintaining CIS perimeter defense also would be transferred to the Air Force. Another possible solution is to give it to the Federal Border Guard Service. This would be logical, because they are not now able to defend against a massive air attack from the probable enemy. The circle of tasks resolved by them, in fact, is limited to early warning of an unsanctioned intrusion of CIS airspace and interception of individual targets. This is more a function of the Border Guard, not the Armed Forces. Moreover, the Federal Border Guard Service looks after the ground and ma- rine border. It would be logical to close the loop by giving them the air component as well.

Legislative Priorities It is proposed that in the immediate future, it is necessary to prepare and confirm in the Federal Assembly (parliament) a national security doctrine and a military doctrine for the Russian Federa- tion. Based on these doctrines, a five-year plan of reform for the Armed Forces of the Russian Fed- eration should be developed and adopted. This current document can be used both to prepare the national security and military doctrines and to prepare the plan of reform for the Armed Forces. Moscow, February 1996


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Barack Obama: a cult of personality

14:4103/07/2009
Vladimir Belaeff, President, Global Society Institute, Inc., San Francisco, CA

Even before the vote of November 2008, a cult of personality has been evolving around Barack Obama. After his election, this cult of president Obama reached new heights, although it now seems to be abating. This wave of uncritical adulation may be understandable within the United States –Obama is indeed a historical figure for America. Also, considering the unfortunate qualities of his predecessor, it is quite reasonable that an articulate, intelligent, sophisticated and thinking president – capable of correctly pronouncing the word “nuclear” – enjoys a charisma somewhat reminiscent of John Kennedy. And so, even trivial actions by Obama are hurriedly qualified as “historic.”

It is premature to make definitive assessments of a president who is only six months into his term in office. And it is a hyperbole to apply the qualifier “historic” to Obama’s actions so far in American international relations.

Understandably, the dire circumstances of the domestic economic crisis have been the major focus of president Obama’s attention (as they well must), so one should not demand much in terms of fresh international initiatives.


Regarding Russia, there is a growing perception that the much ballyhooed “reset” in relations with United States is a PR gimmick, borrowed directly from the vocabulary of American electoral campaigns. The shrill, confrontational and undignified invectives of the past secretary of state have been toned down, but substantive change in actions is yet to be seen. Again, allowance must be made for the new Washington administration’s short time in office, and for the distractions of a difficult domestic economic situation.

Obama’s trip to Moscow will of course include several major photo-ops, and will be accompanied by many verbal and non-verbal symbols. One can also expect several political faux-pas, which are typical of most American high-level visits, usually and regrettably ill-advised and even clueless about the realities of Russian public opinion. The “Sherpas” will have prepared one or several declarations for a ceremonial signature, and these declarations will be more or less significant to the parties (keeping in mind that genuine treaties binding on the United States require congressional ratification – a process which is slow and often fruitless). For example, like the “reset” button, the proposal for mutual deep cuts in nuclear weapons articulated by president Obama is perceived by specialists as yet another utopian goal, made apparently for PR reasons and impossible to truly achieve, if the worldwide configuration of the weapons of mass destruction is taken into account.

The regrettable reality is that Russia and the United States remain engaged in only a few (albeit important) of the many policy sectors where positive collaboration would be beneficial to both countries. The causes of this situation and the ways to overcome it are outside the scope of the present note. Obviously some dialogue is better than none at all, and Obama’s visit to Russia is desirable, but one should not cultivate great expectations regarding its usefulness or productivity. The visit at best should set the stage for a continuation of dialogue and perhaps a process of improving relations in small steps.

Before “historic” results are achieved, there needs to be a genuine paradigm change for the relationship, particularly in America. Since 1986 such a paradigm shift has evidently been taking place within Russia, but one does not see much evidence of a matching change in the policy apparatus of the United States. This situation leads to complications, as the two countries in many instances appear to be speaking past each other. One hopes that president Obama’s first visit to Russia, rather than attempting to be “historic,” will initiate the gradual alignment of relationship paradigms.

This comment first appeared as part of the weekly Russia Profile Experts Panel.

Obama-Medvedev summit: no shortage of advisors

14:4703/07/2009
Edward Lozansky, President, American University in Moscow

There is no shortage of solicited and unsolicited advisors and pieces of advice for the upcoming Obama-Medvedev summit. Some of the advice is pretty reasonable; for the most part it is best ignored. One’s first instinct is to stay away from this cacophony and try to moderate one’s expectations so as not to be hugely disappointed later.
However, the temptation to weigh in with one’s particular advice is very high. Since both Obama and Medvedev are Internet users one does not have to send a letter to the White House or the Kremlin and wait for the routine answer from some clerk. Chances are that both or at least one of them will surf the Net on the eve of the summit and pay attention to some of the items.

My message to Obama is very simple and straightforward. Some people compare him to John Kennedy. This is fine, Kennedy was definitely a remarkable figure – but why not try to raise the sights to the level of Ronald Reagan? Why not finish the job that Reagan started but his followers squandered away? Reagan wanted to confine communism to the garbage dump of history, but at the same time he dreamed of making a liberated Russia an integral part of the West.

The two young leaders will do well to remember the feat performed by their predecessors Ronald Reagan and Mikhail Gorbachev: they ended the Cold War. Obama and Medvedev must be well aware that if it had not been for “Ronny and Gorby,” the Cold War would not have ended the way it did. The U.S.-Soviet confrontation could have extended well into 21st century, and the nuclear option could not have been ruled out. However, the overlapping visions of Reagan and Gorbachev ensured that the collapse of communism was relatively bloodless. These visions met with resistance from an array of forces, but both leaders succeeded despite trenchant opposition of their hawkish advisors.

Unfortunately, the collapse of communism was not followed by what should have been a logical continuation of the process: Russia’s integration in the West. George Bush Sr. administration’s talk of transition to a new security paradigm “from Vancouver to Vladivostok” turned out to be just that: talk. Empty rhetoric.
Still, it is encouraging that this idea is not quite dead yet, and 20 years on there are some indications of it entering the reviving mode. President Medvedev’s repeated calls for a new European security architecture is a step in the right direction. However, the terms should be changed as soon as possible: America should be added to the equation, and the goal should be Euro-Atlantic, not just European security.

Perhaps Medvedev’s original idea was to win European hearts and minds and diminish America’s influence on the European continent. If this was the case, it was pretty naive. Europe and America sometime see things differently, but when push comes to shove, they are definitely together, with or without Russia.

Building a Euro-Atlantic security architecture is obviously not an easy job, but I am sure there are enough bright minds in the American, European and Russian military establishments who can handle it. If Obama and Medvedev can at least agree that Euro-Atlantic security is the logical way to go, then they can definitely claim success for the summit – and we would wholeheartedly agree.


This comment first appeared as part of the weekly Russia Profile Experts Panel.

Pak can tilt Indo-US ties only to a point

http://www.asianage.com/presentation/leftnavigation/opinion/opinion/pak-can-tilt-indo-us-ties-only-to-a-point.aspx

S. Nihal Singh

July.02 : With the advent of the Obama administration, a debate rages on whether America loves India — Prime Minister Manmohan Singh had made amply clear to George W. Bush Indians’ love for him. Two kinds of doubt have surfaced: the United States has downgraded India in its order of priorities and the old policy of hyphenation of New Delhi with Islamabad is back in vogue in Washington.

These Indian fears reveal the country’s tunnel vision and propensity to forget the lessons of the past. Any unbiased observer would have perceived that given the problems left over by the Bush administration — two wars and economic meltdown — India was a low priority for the Obama administration for good reasons.

President Obama had made the war in Afghanistan his own, in contrast to Iraq, and lavished much attention and money on Pakistan because it was considered essential to the outcome of the war. Second, as has been mournfully clear over the decades, Washington’s penchant for seeking short-term advantage plays havoc with its own longer-term goals.

It has been so in the arming of Pakistan during the Cold War, Washington turning a blind eye to Islamabad’s covert efforts to build the bomb, helping Pakistan’s spy agency with sticky fingers, the Inter-Services Intelligence (ISI), in routing arms and money for the anti-Soviet campaign and, until recently, giving Pakistan the benefit of the doubt in dealing with the Taliban. It is thus little surprise that the US should now treble its assistance to Islamabad proverbially to win the hearts and minds of the people.

That said, India continues to display a sense of insecurity in its pecking order in Washington. During her campaign for the presidency, Hillary Clinton, now the secretary of state, had said that China was the most important relationship of her country. So it is on many counts, given the Chinese economy, its breakneck military modernisation and the economic and financial cards Beijing has up its sleeve.

It is equally true that India remains an important country for the US for strategic, economic and ideological reasons. True, those in positions of power in the Obama administration were less than enthusiastic about the terms of the seminal Indo-US nuclear treaty. But there is no indication that Washington will renege on it although it will continue to pursue its non-proliferation goals. Indeed, one of the justifications former President Bush had given for the treaty was that it would help the cause of non-proliferation.

But India must accept the fact that Pakistan has been phenomenally successful in using its geographical location, religious affiliation and willingness to fight for American causes to extract money and arms from Washington. That Pakistan has traditionally used the American largesse for arming itself against India is no secret in Washington — in Krishna Menon’s memorable phrase, guns have not been invented that can fire only in one direction. US compulsions flow from its overriding priority to vanquish the Al Qaeda and the "bad Taliban"; so if Islamabad chooses to strengthen its war machine against India in the process of ostensibly serving American aims, so be it.

That the Obama administration has been less than fully focused on its relations with India should be taken as a compliment. India has reached a measure of political stability, particularly after the last general election, its neighbours and many other parts of the developing world can envy. And it has been clear even during the Bush administration that India must fight its own battle against terrorists, infiltrating from Pakistan or the home-grown variety, on its soil. The US will offer New Delhi help in intelligence and in tracking tainted money but the American goal remains the safeguarding of its citizens and country from terrorists.

Apart from implementing the nuclear treaty — a process stretching to several years — there are wide areas of Indo-US cooperation. The defence relationship is growing exponentially, areas of world trade and finance are fertile soil and India has much to contribute to the phenomenal growth in information technology, biotechnology and stem cell research. The India-Pakistan relationship will remain troubled and US approaches to Islamabad will impinge upon it, but New Delhi must learn to mitigate the harmful effects without crying blue murder each time.

Despite Mr Bush’s democracy crusade, the concept has proved a weak reed as a basis of relations. Washington’s alliances with dictators in various garbs around the world are no secret. America is famously subject to the competing pulls of Wilsonian and Jacksonian precepts embodying idealism and realpolitik.

Most US presidents have taken bits of both until Mr Bush tipped the scale in favour of giving itself the right of pre-emptive strikes against any nation of its choice.

The Obama administration is more inclined to use soft power and is guided by the compulsions of realpolitik. The only goal that does not change, whatever the stripe of the presidency, is Washington’s desire to remain the greatest.

The moral of the story is that India must hone its skills to fight for the country’s interests while cultivating good relations with the pre-eminent power and a host of other competing powers seeking a place in the sun. New Delhi’s interests do not always converge with Washington’s, but that should not be a cause for concern. Inter-state relations have become a more complex power play, with each country seeking to maximise its room for manoeuvre.

Apart from strategic and economic reasons, Indo-US relations are bound to grow in view of the nature of people-to-people relations, the increasingly influential Indian-American community and the enmeshing of millions of Indian families in the lives and fortunes of their kinsmen and women who have made their home in the US. The flow of Indian students to American universities remains undiminished.

The Clinton visit next month will set a marker in the Obama administration’s interaction with India, but it would be foolish to exaggerate its importance. Prime Minister Manmohan Singh’s expected call at the White House in the autumn will be a better touchstone for defining the texture of the relationship with President Obama.

US-Japan 'secret' nuke deal

http://www.thestatesman.net/page.news.php?clid=4&theme=&usrsess=1&id=259774

It is no longer possible for the government to maintain its official stance of denying the existence of a deal between Japan and the United States that tacitly allows US forces to bring nuclear weapons into Japanese territory. The time has come for the government to admit the existence of this accord and explain the facts surrounding it to the public.

In a recent interview with news media, including The Yomiuri Shimbun, Ryohei Murata, a former administrative vice foreign minister, revealed the existence of the accord between the Japanese and US governments under which Japan tacitly approves port calls and passage through Japanese territorial waters by US warships carrying nuclear weapons.

When the Japan-US Security Treaty was revised in 1960, the two countries agreed that US forces would only bring nuclear weapons onto Japanese soil if prior bilateral consultations were held.

However, while this applied to the deployment or storage of nuclear weapons at US bases in Japan, it has long been speculated that the two countries reached a secret deal to exempt port calls, stopovers and passage through Japanese territorial waters and airspace by US warships and aircraft carrying nuclear weapons from the bilateral consultation rule.

The government has consistently denied the existence of a secret accord, but it should seriously consider the fact that a former top bureaucrat of the foreign ministry, who had direct knowledge of the secret accord within the ministry, has admitted its existence.

Around 1960, in the midst of the Cold War, the general public of this nation was strongly allergic to all things nuclear, and there was constant confrontation between the conservative and progressive sides of politics.

Therefore, it can be seen in some ways unavoidable that the government concluded a secret accord with Washington, with an eye on national security in the event of military emergency.

It is right and proper that secrets associated with diplomatic negotiations be kept if a country is to maintain mutual trust with its partner.
However, nearly half a century has passed since then and the situation both at home and abroad has dramatically changed.

On the American side, former US Ambassador to Japan Edwin Reischauer and others have, in the past, revealed the contents of the secret accord to the media. Many US official documents that include mention of the deal have been publicly disclosed.
In Japan, after the collapse of the so-called 1955 regime, which saw a political polarisation with the Liberal Democratic Party on one side and the Japan Socialist Party on the other right through to 1993, the environment is becoming ripe for a comprehensive debate on national security.

Any continuation by the government of its laboured attempts to hide the existence of the secret deal is not in line with national interests. Rather, maintaining the line that there is no deal can only bring negative effects as it would, for example, damage public trust in the government's handling of diplomatic and national security policies.


If the government is to review the secret accord, it will inevitably be required to revisit its long-standing three non-nuclear principles of not possessing, not producing and not allowing nuclear weapons on the nation's soil.
However, while it is appropriate to maintain the principles of not possessing or producing nuclear weapons, the government should be given free rein to review, in a considered manner, the principle of not allowing nuclear weapons on the country's soil.

Temporary port calls and passage through Japanese territorial waters by US warships carrying nuclear weapons are significantly different in their implications to the deploying and storing of nuclear weapons on the ground.
Japan is faced with growing security concerns due to both the increasingly serious nuclear and missile threat posed by North Korea and China's rapid military buildup.
To enhance the nation's deterrent ability under the US nuclear umbrella, it is important that US forces be allowed to operate flexibly in the event of a military emergency. The government must tackle the debate on nuclear weapons with no subject considered taboo.

The Daily Yomiuri/Asia
News Network

INDIA: Report Card of Ministry of Home Affairs for June 2009

18:48 IST

The Union Home Minister, Shri P. Chidambaram presented here today the report card of the Ministry of Home Affairs for June, 2009. The following is the text of his statement:

“June was the first full month that the new Government has been in office. Hence, I thought it would be appropriate to submit a report on the activities of MHA in the month of June 2009.

The most important event in June was the operations launched in Lalgarh, West Bengal. The operations are still under way, but I am glad to report that the Central Paramilitary Forces have ably assisted the West Bengal Police in reclaiming most of the territory that had been dominated by the CPI (Maoist) for nearly 8 months. We reiterated the principle that the primary responsibility for maintaining law and order rests with the State Government and that after committing its own forces, if the State Government makes a request for assistance, the Central Government will provide an adequate number of personnel from the Central Paramilitary Forces.

Another important development was the operationalisation of the NSG hubs at Mumbai, Chennai, Hyderabad and Kolkata. We made a promise to establish these hubs by July 1, 2009 and I am glad that we have been able to fulfil the promise.

As you are aware, MHA presented its first Action Plan for the period February 21 to May 31, 2009. On a review, I found that the first Action Plan has been substantially implemented. A few items, however, have spilled over. In accordance with the directions of the Prime Minister, an Action Plan – called Action Plan II – has been drawn up for the period June 1 to September 30, 2009. The items that have spilled over from the first Action Plan have been included in the second Action Plan. Even while the second Action Plan was being prepared, many elements of the Plan were implemented in the month of June 2009.

The Disaster Management Division of the MHA and the NDMA worked together to rush relief to the victims of cyclone ‘Aila’ which had affected 63.9 lakh people in 26,240 villages.

The Central Government offered logistic support in the form of NDRF Battalions, helicopters, army assistance, essential medicines and Rs.414.70 crore from the CRF (Rs.282.74 crore as opening balance on April 1, 2009 + Rs.131.96 crore as the first instalment). An eleven-member Inter-Ministerial Central Team (IMCT) visited West Bengal on June 6-9, 2009 and the High Level Committee of the NCCF, chaired by the Finance Minister will meet at 6.30 p.m. today.

I visited Jammu & Kashmir on June 11-12, 2009. A decision has been taken to redraw the lines of responsibility among the Army, the para-military forces and the J&K Police. We encourage the J&K Police to take over more responsibilities concerning law and order.

I visited Orissa on June 25-26, 2009. We have requested the State Government to ensure the return of the remaining 1,477 internally displaced persons to their villages and help them re-build their homes.

Some of the specific steps taken by MHA in the month of June 2009 are:

(i) Coastal Security: Up to 31.5.2009, 8 boats were delivered by GSL, Goa and GRSE, Kolkata. In June, 2009, 3 boats were delivered by GSL and 3 boats were delivered by GRSE.

(ii) Coastal Police Stations: Under the Coastal Security Scheme, 73 Coastal Police Stations (CPS) have been approved in 9 States viz. Gujarat, Maharashtra, Goa, Karnataka, Kerala, Tamil Nadu, Andhra Pradesh, Orissa and West Bengal and in the UTs of Daman & Diu, Lakshadweep, Puducherry and Andaman & Nicobar Islands. 59 out of 73 CPSs are functional. Construction work of new buildings has been completed in 33 CPSs and is in progress in 11 CPSs.

(iii) Border Security: 8 kms. of fencing and 5 kms of road works were completed on the Indo-Bangladesh border in June, 2009.

(iv) Immigration: 31 out of the 33 Immigration Check Posts (ICPs) have been provided with upgraded computer systems. 30 out of the 33 ICPs and all 5 FRRO offices have been networked to the Central Foreigners Bureau.

(v) National Investigation Agency: 3 cases were entrusted to the NIA under Section 6(5) of the NIA Act. 123 posts were sanctioned for the Intelligence and Finance wings of the NIA.

(vi) Security Plans for States: Security Related Expenditure (SRE) Committee approved the work plans for 2009-10 for the States of Andhra Pradesh, Bihar, Chhattisgarh, Jharkhand, Orissa and Maharashtra.

SRE Committee approved the inclusion of 1 more district of Andhra Pradesh (Nizamabad) and 5 more districts of Orissa (Deogarh, Jajpur, Kondhamal, Dhenkanal and Nayagarh) under the SRE Scheme.

(vii) Unlawful Activities Prevention Act: On June 22, 2009, ‘CPI (Maoist), all its formations and front organisations’ was included in the Schedule to the Act and thus named as a terrorist organisation.

(viii) CPOs: DGs of Central Paramilitary Forces were given enhanced financial powers for capital works and land acquisition.

A revised recruitment scheme for recruitment of Constables in CPMFs was approved.

135 support staff/officers were sanctioned in various Central Police Organisations for newly created senior management posts.

(ix) Police Modernisation: Orders were placed for supply of automatic grenade launchers, grenades and handheld thermal imagers.

(x) National Population Register: Work is under way for the creation of NPR in coastal areas/districts of the country. A conference of District Magistrates of the coastal districts was held on June 3, 2009. Officers of the Directorate of Census Operations were trained for field work for NPR in coastal areas/districts.

Shri Rameshwar Thakur was appointed as Governor of Madhya Pradesh and, in his place, Shri H R Bhardwaj was appointed as Governor of Karnataka. Shri Debanand Konwar was appointed as Governor of Bihar.

Mr. Justice G P Mathur was appointed as acting Chairman of the National Human Rights Commission.

The Liberhan Commission of Inquiry submitted its report to the Prime Minister on June 30, 2009".

ISLAMISM – A historical background: The Saudi Angle

By R. Upadhyay

http://www.southasiaanalysis.org/papers33/paper3282.html

A peep into the Arabian history during the time of Prophet Mohammad suggests that Mecca, the chief city of Hidjaz in Arabian Peninsula which was his birth place - was the assembly point of the caravans on the land route from southern Arabia and also the centre of annual pilgrimage to Kaba in a ritual called Hajj. Before the advent of Islam, Kaba was the sanctuary of over 300 idols representing the gods of various warring idolatrous Arab nomads who used to fight among themselves not only for their supremacy over each other but also for supremacy of their respective idol gods housed in Kaba which were supposed to be catering to every taste of pagan diversion. Thus, the warring Arabs used to fight for the custody of Kaba to prove the superiority of their respective gods. In fifth century AD, one Qosaiy belonging to the Hashimite sect of Quraysh tribe comprising of some scattered Bedouin clans in central Hizaz seized the Kaba and became its custodian. Qosaiy was said to be a descendent of Abraham and Ishmael the legendary forefathers of the Arabs.

Prophet Mohammad (570-632), belonging to the Hashim clan of Quraysh tribe was born in Mecca in 570 AD. Growing up in the chaotic social environment he developed a feeling to bring unity in Arab society. Accordingly, he used to meditate and felt that multiplicity of gods was the main reason behind such chaos. Since Allah was the main deity of the Qraysh tribe and his father's name was also Abdallah conjugated from Abd Allah which translates as slave of Allah, Mohammad with a view to perpetuate his father's memory chose this word from among the many pre-Islamic Arab deities and accepted it as the sole deity. It is said that nursing an imperialistic ambition to establish the domination of Arabian Quraysh over entire world he adopted a strategy to bring unity among the various tribes by uniting the concept of various gods into one. It is said that in course of meditation he began getting revelations from the year 610 AD at frequent intervals till his death in 632 AD.

In between a number of revelations to him was the war strategy for capturing Kaba in the city of Mecca. With first revelation – `La ilah ilallah Mohummadur Rasullah'(There is no god but Allah and Mohammad is his Prophet) in 610 AD, he made his journey by preaching among his own people in Mecca. However, he failed to convince the idolatrous Meccans, as the harsh and barren desert environment of Arab society which had not only shaped the temperament of its people but also of their mental make up by the dictum – "Kill or be killed". Facing humiliation and danger he fled to Medina and turned into a `warrior priest' by enticing some of the people around him under the banner of Islam. With a view to capture Kaba as his first target, he led his people by formulating the concept of Jihad (Literally meaning struggle) as "exertion on the path of Allah" and led them to invade the Meccan caravans. His first Jihad from Medina is known as the Battle of Badre when he lauded his followers against the army of opponents saying - "Fight and fear not, the gates of Paradise are under the shade of sword" (`The Arabs' by Anthony Nutting, Hollis & Carter, London, page 23). The defeat of Meccans in this war in 624 was the first victory of Islamic Jihad. In fact by using Islam as a violent political tool he led his followers to destroy the opponents who refused obeisance to it.

Encouraged with his first victory Mohammad made a tactical truce with the Omayyad sect of Quraysh tribe led by Abu Sufyan, the then custodian of Kaba and eventually succeeded in capturing Mecca in 630 AD. After the surrender of Abu Sufyan and obedience to Islam, Mohammad captured Kaba and demolished all the pre-Islamic idols except a black stone around which the Arabs were doing seven rounds, the customary pagan practice. As a part of his political strategy to establish the hegemony of Meccans, he also allowed the pre-Islamic pagan practice of circumambulation to continue as the focal point of Haz pilgrimage. Similarly, allowing the pre-Islamic Arab traditions like drinking water from the Zamzam well, throwing 21 stones at pillars representing evil spirits (Satan) on a holy mountain and sacrifice of camels and sheep, the Prophet prescribed these rituals as well as pilgrimage to this place once in a year for all the Muslims of world as the mandatory rites. Once he became the custodian of the Kaba he also became the temporal and spiritual head of both Mecca and Medina and allowed the old customs like slaves, concubines to continue.

In the last address to his companions before his death, Mohammad pronounced, "I was ordered to fight all men until they say `there is no god but Allah'. (Prophet Mohammad's farewell address, March 632 – Islamic Imerialism – A History – Efraim Karsh, Yale University Press London, 2006, page 2). Since the Prophet adopted the path of violent war to establish Islam in his home town Mecca, his followers have no inhibition in taking the similar path. In fact the first battle of Badr and his last address became the perpetual advice and inspiring events for all the Muslims for any political conquest anywhere in the world.

Prophet Mohammad forbade the entry of non-Muslimsto Mecca to complete its full Islamisation. His war strategy for imperial expansion of Islam with Medina as administrative centre of Islamic Empire was a novel form of socio-political communal concept of Ummah, a divinely ordained brotherhood bound by something stronger than geographical boundary. Perhaps tying up Islam with pagan reverence to the city of Mecca and a number of its pre-Islamic traditions and customs was not only political expediency of the time but also a strategy to make the Arabs as the super most power of the world. Such imperialistic political design which had nothing to do with the spiritual aspect of the faith latter turned into civilisational clash in different parts of the world.

After the occupation of Mecca, Mohammad declared it as the holiest city for the Muslims and fell ill. Although, the followers of Mohammad obeyed his writ till his death in 632 AD, political dispute over the superiority among the clans for succession began immediately. Fight for superiority which they had inherited from their pre-Islamic gene, divided the Ummah (Muslim community) into various sects. This was the first sign of deviation b

Why dialogue with Pakistan is futile

http://news.rediff.com/column/2009/jun/29/sushant-sareen-why-dialogue-with-pakistan-is-futile.htm

Considering that 2009 marks the 20th year of full-blown insurgency in Kashmir, it is somewhat surprising that there are not many books that go behind the scenes and beyond newspaper reports to lay bare what actually was happening on the ground and to the people of the state. In recent years, however, Praveen Swami and David Devadas have done some remarkable work to fill some of this empty space. But until now, very little was known of how the insurgency was guided from across the border in Pakistan and Pakistan-occupied Kashmir.

Much of what we know is based on information handed out by the Indian security agencies. There was however no means to corroborate this information. The absence of any independent source of information, which was also reliable, left a huge gap in our knowledge of how the insurgency was planned and how it played itself out inside Pakistan. Also missing was the story of the jihadists and Kashmiri separatists who operated from Pakistan.

In his book Shadow War -- The Untold Story of Jihad in Kashmir, Pakistani journalist Arif Jamal, unveils the involvement of Pakistan in the insurgency and provides some new and quite startling details of the jihad that Pakistan waged against India in Kashmir. Having covered and observed this jihad from very close quarters, Arif was ideally placed to write this book. There is little that he doesn't know about the people and organisations involved in spawning militancy and terror in Kashmir. But while he is brutally honest in exposing all the misdeeds and murders that were committed in the name of 'Kashmiri struggle for independence', he has concentrated more on the involvement of the Jamaat Islami and its terrorist arm, Hizbul Mujahideen [ Images ], in spreading murder and mayhem in Kashmir.

In the process, Arif has ignored the role of terror outfits like Lashkar-e-Tayiba [ Images ] and Jaish-i-Mohammed because, according to him, "they have a global agenda in which Kashmir is no more than a training ground."

Arif busts many myths in his book, not the least of which is the commonly held view that the alleged rigging in the J&K state assembly elections in 1987 sparked the insurgency. According to Arif, right from the time of partition, Pakistan was always on the lookout for opportunities to stir up trouble in Kashmir. There were occasional lulls in Pakistani efforts to destabilise Kashmir, for instance after the 1971 war. But these periods had more to do with Pakistan's compulsions rather than any change of intentions. As Arif puts it, "Jihad, holy war and diplomacy were thus the first elements of Pakistan's foreign and defence policy -- and they remain so more than 60 years later."

He reveals that in early 1980, General. Zia-ul Haq held a meeting with the chief of Jamaat Islami in PoK, Maulana Abdul Bari. In this meeting Zia told Bari that he "had decided to contribute to the American-sponsored war in Afghanistan in order to prepare the ground for a larger conflict in Kashmir".

Zia predicted that "the Americans would be distracted by the fighting in Afghanistan and as a result would turn a blind eye to Pakistani moves in the region" [If one goes by what Arif writes later in this book, a similar calculation is being made by the Pakistan army [ Images ] today]. When Bari asked Zia who in Afghanistan will receive the biggest share of US assistance, Zia said "whoever trains the boys from Kashmir".

Arif puts a lie to the propaganda that the insurgency in Kashmir is a localised phenomenon and has no links with Jihad international. The book clearly points to the organic links that were established between the Islamists who were waging jihad in Afghanistan and those waging jihad in Kashmir. According to Arif, "in the early days of fighting, Hizbul Mujahideen had all its fighters trained at camps in Afghanistan run by Hizbe Islami [of Gulbadin Hikmatyar]. In particular, they made use of al Badr in Khost province... Kashmiri fighters also made use of other camps in Afghanistan, including Khalid bin Walid, Al Farooq and Abu Jindal." The camp, Abu Jindal, was known as a site for training Arab fighters and in 1998 Osama bin Laden [ Images ] held a press conference there. Later, Arif reveals, training camps were established all over Pakistan and in PoK.

According to the book, the Hizbul Mujahideen learnt its brutality and savagery at the feet of Gulbadin Hikmatyar, who advised the HM chief Syed Salahuddin to eliminate all his rivals. The book quotes a HM commander who said that his organisation eliminated over 7,000 political rivals. But according to another dissident HM commander the number was "many times higher". The method of killing rivals -- chopping bodies, beheading them, sawing them, hanging them publicly are all eerily reminiscent of the tactics used by the Pakistani Taliban [ Images ] in Swat recently.

In a sense, Arif corroborates a lot of what Indian security agencies had already revealed to the Indian media. But where Arif breaks new ground is by informing his readers the suppleness with which the Pakistani military establishment adapts to unfavourable international situations and calibrates the jihad in Kashmir accordingly. This is something that holds important lessons for those in India who once again have started suffering from the delusion that Pakistan army has realised the futility of the jihad and that therefore the time is ripe for striking a workable deal with Pakistan.

Arif believes that the appointment of General Ashfaq Kiyani as army chief signals "a continued strengthening of Pakistani support for jihadi groups". He quotes an HM commander as saying that the jihadis "never had it so good since 1999".

In a clear indictment of the Pakistani policy of unending jihad against India, Arif writes that "in the spring of 2007, the ISI arranged several meetings between a group of Pakistani and Kashmiri jihadis and the Afghan Taliban... these meetings were aimed at creating coordination between the two jihads, in Afghanistan and in Kashmir... As a result of these meetings, some Pakistani jihadi groups joined their Afghan comrades in the tribal areas of Pakistan and also inside Afghanistan. However, most importantly, more jihadis were pushed across the LoC or use other routes to reach India... In a new strategy, most of them were ordered to establish sleeper cells". The aim of this link-up is apparently to reduce Indian support to the Hamid Karzai [ Images ] government and Arif speculates that the bombing of the Indian embassy in Kabul is probably a result of this new strategy.

Given that it now appears only to be a matter of time before India and Pakistan re-start the stalled dialogue process, this book should be an eye opener for the Indian negotiators. While negotiations are always a preferred way to resolve disputes, they will never be fruitful until and unless there is a genuine desire on both sides to seek some sort of a middle ground on which a deal can be struck. But if negotiations are only a smokescreen or a diversionary tactic for a nefarious game-plan, then quite obviously the negotiations will be a dialogue of the deaf.

The book, Shadow War, only reinforces the apparent futility of any dialogue with Pakistan at this stage.

Sushant Sareen

Sanitizing terrorism

No longer can it be hidden that locals were involved in the November 2008 Bombay attack, says N.V.Subramanian.

29 June 2009: The story of the November 2008 Bombay terrorist attack has one puzzling aspect. Were there only ten Pakistani terrorists involved (including Ajmal Kasab) in it, or did they get local help also? The Centre and the Maharashtra government insist that the ten Pakistani terrorists were on their own and did not get any local logistical help, aside from the earlier procurement of SIM cards, etc, by Lashkar-e-Toiba contacts in India.

While this indeed might be the case, it is not convincing. What the Indian government wants the world to believe is that the Pakistani terrorists were so familiar with the geography of South Bombay (where the Taj and Oberoi hotels were, the location of the Jewish centre, the ins and outs of CST, and so on) that they went machine-like spreading terror absolutely without local support.

If you believe this version, it makes India into a banana republic hopelessly vulnerable to terrorism. Anybody can float in on a dinghy from anywhere, catch the first cruising cab, and casually embark on a mission of terrorism. It might well be true, but it does not seem the case, not at least in the detail.

What is a more convincing alternative scenario? Scenario one is that Kasab & Co came earlier to South Bombay to recce it for the terrorist attack. They may have stayed for a couple of days or perhaps a week or more. In this time, they familiarized themselves with particular locations of future terrorist attacks (they may even have finalized the locations for their maximum impact), perhaps even stayed in one of the targeted hotels, and generally undertook every preparation to make the planned terrorist mission a success. In all this, they might have got local support or perhaps a decision was taken to exclude the Bombay LeT sleeper cells from this attack and reserve it for future use.

The second scenario is as the government says the terrorist attack happened, but with one important addition. A local LeT cell closely coordinated the attack from the moment the Pakistani terrorists landed. This is the conclusion of a recent BBC investigation which says there were spotters on the ground that were relaying accurate intelligence to their Pakistani handlers about the deployment of security forces in the attack zone, which information was promptly relayed to the terrorists. The BBC investigation rejects the police theory that live TV coverage aided the terrorists. It says the TV coverage was not so all-encompassing as to assist the terrorists to the claimed extent.

Which scenario is more plausible, the first or the second? The first, because the terrorists moved to their objectives with a confidence that suggested they had closely studied the area before. But this can be countered by saying the terrorists were trained in their mission with large-scale ordnance maps of South Bombay, which is quite possible. Goggle Earth can give you reasonable familiarity with a place. But it is still doubtful if a terrorist mission would be planned on the basis of large-sized maps if location visits could be arranged.

But if scenario one is totally ruled out, then scenario two can only succeed with local logistical providers including spotters that the BBC investigation talks about. Ten terrorists robotically moving to their targets without local help or physical familiarity with the place is simply unbelievable. The Centre and the Maharashtra government cannot expect anybody to accept their rather sanitized version of events. There had to be local help to the terrorists, and in the interest of preventing and pre-empting future terrorist attacks, the Union home minister, P.Chidambaram, ought to come clean.

What is the problem in admitting to one or several Bombay LeT cells? Nothing at all. The December 2001 Parliament attack had local links. The terrorist on death row, Afzal Guru, was not among the attackers, but was part of the attack conspiracy, operating out of a relative's home in Delhi. His conviction does not taint a community, although the delay in carrying out the Supreme Court sentence is certainly maligning it.

The same is true about local involvement in the Bombay attack. It is well-known that the LeT and Jaish-e-Mohammed have set up sleeper cells in several Indian cities and towns. It is part of their aim to dismember India. Admitting of these cells does not impugn the nationalism of any community. They have been freely admitted before. The same community has prevented the burial of any of the nine Bombay terrorists killed in the attack. The community is matured to want Pakistani terrorists removed from its midst once for all, and this is what the government should do, rather than hide behind lies.

Nor will the exposure of local help weaken the case against the Pakistani masterminds and handlers of the Bombay terrorist attack. Nobody is in any doubt that the attack plans originated in Pakistan, and no one questions the key role played by the LeT terrorist leader, Hafiz Mohammed Sayeed. India won't have a watertight case against Hafiz Sayeed and the other Pakistani terrorist planners unless it sews up the local end. This is a terrorist investigation, not a political whitewash job. The credibility of India is at stake.

N.V.Subramanian is Editor, NewsInsight.net. He has authored two novels, University of Love (Writers Workshop, Calcutta) and Courtesan of Storms (Har-Anand, Delhi).

Please visit N.V.Subramanian's blog http://courtesanofstorms.blog.com/

IAF to take part in international air mobility competition

http://www.hindu.com/thehindu/holnus/002200907011051.htm

Washington (PTI): The Indian Air Force will take part in the international air mobility competition to be held in the US this month, organisers of the event announced on Wednesday.

To be staged from July 19 to July 25, 'Air Mobility RODEO 2009' is being hosted by Air Mobility Command at Washington- based McChord Air Force Base of the US Air Force.

More than 100 teams and 2,500 people from the US and friendly nations are expected to compete or observe in the week-long event which focuses on improving worldwide air mobility forces' professional core abilities.

The last RODEO readiness competition also took place at McChord Air Force Base in July 2007.

The competition started in 1956 as the "Reserve Troop Carrier Rodeo", while the first active duty airdrop competition occurred in April 1962.

An important long-term benefit, the US Air Force said, is increased cooperation between air mobility forces among participating nations.

Collectively, the ultimate goal of the competition is to develop and improve techniques and procedures that enhance air mobility operations.

"Not only does this world-class competition train mobility forces for the fight, it provides a forum for our international partners to share the best of tactics and techniques," said Maj Gen Brooks Base, AMC Directorate of Air, Space and Information Operations commander and RODEO 2009 commander

How the U.S. Has Secretly Backed Pakistan's Nuclear Program From Day One

A CounterPunch Exclusive Report
The Obama Adminstration is Helping to Upgrade Pakistan's Nuclear Weapons


By ANDREW COCKBURN

"If the worst, the unthinkable, were to happen,” Hillary Clinton recently told Fox News, “and this advancing Taliban encouraged and supported by Al Qaeda and other extremists were to essentially topple the government … then they would have keys to the nuclear arsenal of Pakistan.” Many will note that the extremists posing this unthinkable prospect were set up in business by the U.S. in the first place. Very well buried is the fact that the nuclear arsenal that must not be allowed to fall into the hands of our former allies has been itself the object of U.S. encouragement over the years and is to this very day in receipt of crucial U.S. financial assistance and technical support.

Back in 1979, Zbigniew Brzezinski, intent on his own jihad against the USSR, declared that the “Afghan resistance” should be supplied with money and arms. That, of course, required full Pakistani cooperation, which would, Brzezinski underlined, “require a review of our policy toward Pakistan, more guarantees to it, more arms aid, and, alas, a decision that our security policy toward Pakistan cannot be dictated by our nonproliferation policy.” In other words, Pakistan was free to get on with building a bomb so long as we could arm the people who have subsequently come back to haunt us. Asked for his views on Pakistan’s nuclear ambitions, Ronald Reagan replied “I just don’t think it’s any of our business.” During the years that the infamous A.Q. Khan was peddling his uranium enrichment technology around the place, his shipping manager was a CIA agent, whose masters seem to have had little problem with allowing the trade to go forward.

Now comes word from inside the Obama government that little has changed. “Most of the aid we’ve sent them over the past few years has been diverted into their nuclear program,” a senior national security official in the current administration recently told me. Most of this diverted aid -- $5.56 billion as of a year ago – was officially designated “Coalition Support Funds” for Pakistani military operations against the Taliban. It may be that this diversion came as a terrible shock to Washington, but the money has been routinely handed over essentially without accounting being required from the Pakistanis. The GAO has huffed at items such as the $30 million shelled out for non-existent roads, of the $1.5 million for “naval vehicles damaged in combat” but that was as far as public complaints went. In the meantime, as Joint Chiefs Chairman Admiral Mullen confirmed recently, the Pakistanis have been urgently increasing their nuclear weapons production.

A former national security official with knowledge of the policy explained this insouciance to me. “We want to get in there and manage [their nuclear program]. If we manage it, we can make sure they don’t start testing, or start a war.” In other words, the U.S. is helping the Pakistanis to modernize their nuclear arsenal in hopes that the U.S. will thereby gain a measure of control. The official aim of U.S. technical support, at an estimated cost of $100 million a year, is to render the Pakistani weapons safer, i.e., less likely to go off if dropped, and more “secure”, meaning out of the reach of our old friends the extremists.

However, in pursuit of this objective, it is inevitable that the U.S. is not only rendering the warheads more operationally reliable, we are also transferring the technology required to design more sophisticated warheads without having to test them, a system known as “stockpile stewardship.”

Conceived after the U.S. forswore live testing in 1993 as a means to “test” weapons through computer simulations, this vastly expensive program not only ensures the weapons’ reliability (at least in theory) but also the viability of new and improved designs. In reality, the stewardship program has been as much a boondoggle for the politically powerful nuclear laboratories at Livermore and Los Alamos as anything else, so outreach in the form of assistance to the Pakistanis in this area can only gratify our own weaponeers.

“If you’re not confident that weapons are safe to handle, you’re more likely to keep them in the basement,” says nuclear command and control expert Bruce Blair, President of the World Security Institute. “The military is always pressuring to deploy the weapons, which requires an increase in readiness.” In 2008 Blair himself was approached by the Pakistani military seeking advice on means to render their weapons more secure. Their aim, he says, was clearly to render their nuclear force “mature,” and “operational.” In the same way, says Blair, a few years ago an Indian military delegation turned up at the Russian Impulse Design Bureau in St. Petersburg, to ask for help on making their weapons safer to handle. “They said they wanted to be able to assure their political leadership that their weapons were safe enough to be deployed.”

Pakistan’s drive to build more nukes is an inevitable by-product of the 2008 nuclear cooperation deal with India that overturned U.S. law and gave the Indians access to US nuclear technology, not to mention massive arms sales, despite their ongoing bomb program.

The deal blew an enormous hole in the Non-Proliferation Treaty, but initial protests from congressional doves were soon smothered under human-wave assaults by arms company and nuclear industry lobbyists. The Israelis lent additional and potent assistance on Capital Hill. Not coincidentally, Israeli arms dealers, promised a significant slice of the action, have garnered at least $1.5 billion worth of orders from Delhi. (The respected Israeli daily Haaretz has highlighted Indian media reports that the bribes involved totaled $120 million.) Nuclear power’s handmaiden, the global warming lobby, was also a wellspring of ardent support, led by Rajendra Pachauri, the Indian railroad engineer who is Chairman of the Intergovernmental Panel on Climate Change which shared Al Gore’s Nobel prize.) Even the Dalai Lama was drafted in to use his influence with impressionable members of congress.

The consequent success in overturning a longstanding arms control treaty, which in turn has led to the U.S. extending a helping hand to India’s nuclear rivals in Pakistan, should only be seen as the wave of the future. Instead of foaming at the Iranian nuclear program, we should be standing at the ready to oversee their design of safer, more reliable nukes, and after that, who knows? North Korea’s bomb probably need work too.

Andrew Cockburn writes about national security and related matters. His most recent book is Rumsfeld: His Rise, Fall and Catastrophic Legacy. He is the co-producer of American Casino, the feature documentary on the ongoing financial collapse. He can be reached at amcockburn@gmail.com.

UN Unveil Initiative to Help Form New ‘Partnership Agenda’

UN: Top Peacekeeping Officials Brief Security Council on Need to Strengthen Links Between Organization, Contributors of Military, Police Forces
Under-Secretaries-General Unveil Initiative to Help Form New ‘Partnership Agenda’

With demand for United Nations peacekeeping continuing to grow, conflict situations becoming more complex and resources more scarce, the success of current and future operations depended on strengthening relationships between the Organization and its Member States, especially those providing troops and police, senior peacekeeping officials told the Security Council today.

Calling for a new partnership to ensure the requisite support and resources, Alain Le Roy, Under-Secretary-General for Peacekeeping Operations, said: “When all the partners are strongly united behind a peacekeeping operation, it sends an unequivocal signal of international commitment which reinforces the authority of the Security Council and the credibility and effectiveness of any individual operation.”

Briefing the Council with Susana Malcorra, Under-Secretary-General for Field Support, Mr. Le Roy said the theme of today’s meeting -- “The relationship between the Council and the police and troop-contributing countries” -- reflected the central fact that United Nations peacekeeping was a global partnership that brought together the Council’s legal and political authority with the essential personnel, material and finances of the Member States. “It also draws together the Secretariat ‑‑ which must plan and manage the operations ‑‑ and the leaders and people of host countries, whose ongoing commitment to peace is perhaps the single most important factor,” he said. “Each one of the partners brings a vital contribution to peacekeeping,” he added.

“Each depends on the other. Together, the partnership brings UN peacekeeping its strengths of legitimacy, burden-sharing, adaptability and reach, he said,” cautioning, however that if one element of the partnership was weak, the entire project was weak. “Therefore, any efforts to strengthen peacekeeping must be holistic and comprehensive.” In the current global environment, financial constraints required a review of the basic models of peacekeeping. The costs, troop numbers and capability requirements could not all continue to rise indefinitely. “And there is no sign that demand is decreasing.”

The Departments for Peacekeeping Operations and Field Support were working jointly on New Horizon, an initiative to help form a new “Partnership Agenda” for peacekeeping, he said. “The objective is to arrive at a set of achievable immediate, medium- and long-term goals to help configure UN peacekeeping to better meet today’s and tomorrow’s challenges,” he added.

He said the initiative focused on critical peacekeeping tasks and functions requiring a renewed consensus on issues such as the role of peacekeepers in delivering on the civilian protection mandate; measures to improve mission design, resourcing and deployment; proposals on assessing and building the capacities needed for future peacekeeping; and a strategy to create a stronger, more flexible support system. He added that as mandates grew more demanding and dangerous, a strong sense of common purpose and close linkage between the Council’s intent and what troop and police contributors were ready to deliver was essential.

Turning to another critical concern, he said that, out of necessity, stakeholders had focused force generation on numbers rather than the capabilities necessary to fulfil the mandate of a certain mission, citing the African Union-United Nations Hybrid Operation in Darfur (UNAMID) as a vivid example. The exercise must shift the focus to operational requirements and how to better generate capabilities, rather than just numbers. “We need to jointly identify the type of capacity required, including agreed minimum standards for troops and police carrying out UN peacekeeping while also delivering essential improvements to the UN training system.” The new partnership agenda would require cooperation with the Council and other key stakeholders. “Together we must set the agenda for the peacekeeping of tomorrow.”

Ms. Malcorra noted that the past decade had seen several useful innovations, including the creation of Strategic Deployment Stocks that allowed the United Nations to equip and supply missions more quickly than before, and the establishment of a peacekeeping reserve to allow for “commitment authority” of up to million in advance of a Security Council mandate. “But both these innovations are not calibrated to the current demands,” she pointed out. “Their ceilings remain static while the overall peacekeeping budgets have more than tripled.”

She echoed the need for a new agenda for partnership, stating that “more of the same” simply would not do. “We envisage a more nuanced, targeted approach ‑‑ with elements of mission support provided globally, others from a regional centre and others at the level of the individual mission. The current model of full-support components for each and every mission needs to be re-visited.”

Among other things, she cited the need to explore options that would lead to, among others, “a lighter mission footprint”, faster turnaround without compromising accountability and oversight, greater use of local staff and local suppliers, and revisiting the current contingent-owned equipment model, including rates of reimbursement.

She went on to say that one way to build capability and performance without increasing the in-mission headcount was to invest more in technology-driven solutions, such as better information analysis, improved communications and higher-performing equipment, among other things. There was also a need to develop a truly global and mobile workforce that would be faster, have more targeted recruitment, better skills and career-development options, and greater agility across functions and locations.

Among other speakers taking the floor was Council President Baki İlkin of Turkey, who spoke in his national capacity, highlighting the challenges facing United Nations peacekeeping, including financial shortfalls, shortages of military and other personnel, and general overstretch. He said the General Assembly’s Fifth Committee (Administrative and Budgetary) had approved a peacekeeping budget of some billion, a record amount set during a time when other crises, including the ongoing economic slowdown, were straining global capabilities and exerting pressures on efforts to maintain complex and long-running missions.

“We definitely need a compass setting out the agreed and achievable goals and a collective determination of the future of UN peacekeeping,” he said. Implementing reforms, generating resources, building up the necessary capabilities and developing effective partnerships among all stakeholders, as well as improving inter-operability, had turned out to be essential to that end. More rapid and flexible peacekeeping operations required institutional and operational reforms to command-and-control mechanisms, procurement and supply systems.

However, Pakistan’s representative said that, while efforts to reform United Nations peacekeeping activities were clearly under way, Member States had not yet had the opportunity to fully and properly assess and review the results or impact of that exercise. “We do not have a clear idea of how effectively the new mechanisms and structures are performing,” he said, adding that, in the meantime, new plans by some Member States and the Secretariat continued to be put forward.

Pakistan’s preliminary analysis of such initiatives was that, while they could become catalysts for discussion, they presented little new by way of dealing with the major lingering issues or challenges, he said. Pakistan, the Organization’s largest troop contributor, wondered whether that was a question of exposing the limitations of past reforms or one of fully implementing them through a sustained effort. If Member States regarded peacekeeping as an indispensable instrument, then they should all take a strategic decision to support it fully and wholeheartedly, with the political will to ensure burden-sharing and pooling of resources, and equitable decision-making to ensure its success.

Agreeing, Nigeria’s representative said Member States needed to forge a consensus on strategies to address such challenges as gaps between mandates, inadequate planning, fluid exit strategies and imprecise relationships between troop-contributing countries, the Secretariat and the Council. It was imperative to involve troop contributors from the conception and resolution-drafting stages of an operation to its deployment and final exit, she said. In addition, resource constraints dampened the morale and enthusiasm of peacekeepers and the political will of troop contributors.

Furthermore, it was important to ensure adequate and predictable resources to accomplish mandated tasks, she continued. Adequate pre-deployment training should be a prerequisite to the successful implementation of any mandate. Nigeria supported intensified dialogue and consultations involving the Fifth Committee, the Peacebuilding Commission, the Special Committee on Peacekeeping Operations and the Security Council Working Group on Peacekeeping Operations in order to overcome some of the clearly delineated challenges facing United Nations peacekeeping.

Other speakers today were the representatives of France, Austria, Japan, Uganda, Burkina Faso, China, Mexico, United Kingdom, Costa Rica, Libya, United States, Russian Federation, Viet Nam, Croatia, Canada, Italy, Brazil, Jordan, Morocco (on behalf of the Non-Aligned Movement), Czech Republic (on behalf of the European Union), Rwanda, Spain, India, Republic of Korea, Ghana, Nepal, Germany, Egypt, Bangladesh and Uruguay.

Also addressing the Council was the Political Affairs Adviser in the Office of the Permanent Observer of the African Union.

The meeting began at 10:10 a.m. and suspended at 1:15. Resuming at 3:05 p.m. it ended at 5:30 p.m.

Background

The Security Council met this morning to take up matters relating to United Nations peacekeeping operations.

Opening Statement

BAKI İLKIN (Turkey), President of the Council, said in opening the meeting that his delegation had proposed the debate during such a busy month as part of the Organization’s ongoing effort to review and enhance its peacekeeping strategies, and in the ambit of the ongoing reform of the Department of Peacekeeping Operations. Reforms could only be carried out in an atmosphere of mutual, transparent and interactive dialogue.

Expressing his delegation’s satisfaction with the attendance of the major contributors of troops, police and financing to United Nations peacekeeping operations, he reminded the Council that many efforts were under way in various forums to enhance peace operations, including the Secretariat-level New Horizon initiative. Hopefully today’s debate would inform such discussions with the aim of strengthening and enhancing the Organization’s peace operations.

Briefings

ALAIN LE ROY, Under-Secretary-General for Peacekeeping Operations, said the theme of today’s meeting ‑‑ “The relationship between the Council and the police and troop-contributing countries” ‑‑ reflected the central fact that United Nations peacekeeping was a global partnership that brought together the Council’s legal and political authority with the essential personnel, material and finances of the Member States. It also drew together the Secretariat, which must plan and manage the operations, and the leaders and peoples of the host countries, whose ongoing commitment to peace was perhaps the single most important factor. It also drew together the entire United Nations system with the broad range of regional and multilateral organizations that worked alongside the Organization.

“Each one of the partners brings a vital contribution to peacekeeping,” he said. “Each depends on the other. Together, the partnership brings UN peacekeeping its strengths of legitimacy, burden-sharing, adaptability and reach.” When all those partners were strongly united behind a peacekeeping operation, it sent an unequivocal sight of international commitment, which reinforced the authority of the Security Council and the credibility and effectiveness of any individual operation. Of course, if one element of the partnership was weak, the entire project was weak, he cautioned, adding, “Therefore, any efforts to strengthen peacekeeping must be holistic and comprehensive.”

The Organization could not advance new concepts, such as formed police units, without an ongoing dialogue with contributing countries as to the tasks that they would carry out and the standards they must maintain, he said. There were critical political connections between mandates, planning, budgets and force generation, all of which were addressed in different forums of the United Nations. Commitments in one forum needed to be translated into resources in others, and support on the ground, he said. Such interdependence meant that “we need strong frameworks for communication and dialogue to reach a common, shared assessment of the challenges and potential for peacekeeping”.

He said peacekeeping today was five times larger than it had been following the release of the Brahimi report nearly a decade ago, said, pointing out the greater complexity of today’s mandates and the lack of consensus on how certain tasks should be fulfilled. There were political differences as to the overall goals and direction of a number of missions, while limited consent from key parties hampered a number of others, he said, stressing also that needed capabilities, such as helicopters, were not available in sufficient quantity. “Our logistical and administrative systems are overstretched by the scale and tempo of operations in some of the world’s most difficult terrain […] and overarching all of this is the reality that, in the current global environment, financial constraints press us to review the basic models of peacekeeping.”

Costs, troop numbers and capability requirements could not continue to rise indefinitely, but in the meantime, there was no sign that demand for United Nations peacekeeping was decreasing, he said. On the contrary, factors such as environmental shocks, transboundary organized crime and extremism might well contribute to political instability and lead to new demands. “This means the peacekeeping partnership has to be broad and strong, in terms of the participants and their contributions, as well as deep, in terms of its consensus and unity of purpose.” Aside from peacekeeping, the full spectrum of responses must be available to the international community, including prevention, mediation and multinational force deployments.

Going on to highlight the priorities of such a new partnership agenda, he said the Department of Peacekeeping Operations/Department of Field Support New Horizon initiative, the agenda’s linchpin, aimed to arrive at a set of achievable, immediate, medium- and long-term goals to help configure United Nations peacekeeping to better meet the challenges of today and tomorrow. The Council had already received an executive brief of a non-paper to be released in July, which focused on critical peacekeeping functions requiring renewed consensus; measures to improve mission design, resourcing and deployment; proposals on assessing and building the capabilities needed for future peacekeeping; and a strategy to create a stronger, more flexible support system.

Focusing on a few of those issues, he said there was a need for a clearer consensus on the role of peacekeepers in delivering on the civilian protection mandate. There was also a need to establish a common understanding of the political, strategic, and operational aspects of “robust peacekeeping”, building on discussions currently under way among Member States. As mandates grew more demanding and dangerous, a strong sense of common purpose and close linkage between the Council’s intent and what troop and police contributors were ready to deliver was essential. As the number of mandated tasks grew, greater clarity would also be needed on the extent of the peacebuilding activities that peacekeeping missions should carry out and the resources required for that. Security-sector reform and strengthened rule of law were essential in helping to develop national capacity in host countries, in forming an important part of the exit strategy and in helping host countries rebuild the institutions that would allow them to exercise their own sovereignty.

With respect to the design, resourcing and deployment of missions, he emphasized the need to ensure sustained political support, and underscored the critical importance of an active, functioning political process to address the conflict. “Where our peacekeeping operations are struggling, it is usually the case that there is a lack of an inclusive peace process. Darfur illustrates this point,” he said, stressing that, no matter how well trained and specialized United Nations peacekeepers might be they could not be successful in the absence of a viable peace process. One way of contributing to such sustained support was through informal coalitions of Member States focused on providing political and materiel support through the life individual missions.

On building future capacity, he said too many peace missions lacked critical capabilities, noting that troops in dangerous environments lacked the information and mobility critical to force protection and mandate implementation. “I believe a priority will be to agree on the nature of capabilities required for modern peacekeeping […] there must also be sufficient incentives to allow UN peacekeeping to obtain these.” Peacekeepers operated simultaneously in the jungles of the Democratic Republic of the Congo, the deserts of Chad and Darfur, and urban centres such as the Haitian capital, Port-au-Prince. Different capabilities were needed in each setting, and there was a need to review the reimbursement procedure for contingent-owned equipment so as to ensure it reflected today’s reality.

“Out of necessity, we have focused our force generation on numbers rather than what capabilities have been needed to fulfil the mandate of a certain mission,” he continued, citing the African Union-United Nations Hybrid Operation in Darfur (UNAMID) as a vivid example. Stakeholders must shift their focus to operational requirements and how to better generate capabilities, not just numbers. “We need to jointly identify the type of capacity required, including agreed minimum standards for troops and police carrying out UN peacekeeping while also delivering essential improvements to the UN training system.”

One critical goal of the overall strategy to ensure peacekeeping had the capacities it needed was to expand the base of troop- and police-contributing countries, he said. There must be more equal burden-sharing throughout the United Nations system, and the Secretariat must also ensure that it addressed outstanding command-and-control questions that potential troop- and police-contributing countries might have.

While it was clear that United Nations peacekeeping was the instrument of a hyper-operational Organization, its support systems had not caught up to that new reality, he said. “We have to make adjustments in how we support our missions to increase flexibility and efficiency,” he said in reference to field support. The new partnership agenda would require cooperation with the Council and other key stakeholders. “Together we must set the agenda for the peacekeeping of tomorrow.”

SUSANA MALCORRA, Under-Secretary-General for Field Support, said the “New Horizon” initiative was a joint exercise between her own Department and that of Peacekeeping Operations, with the two fully in sync. The broad strategic outlines of the initiative would have major implications for the support side over the next three to five years. A new agenda for partnership was needed to address problems in delivering increasingly complex and varied mandates in difficult, often isolated and inhospitable locations, and innovations to the support model could not move ahead without the full engagement and buy-in of Member States.

“We are not starting from scratch,” she stressed, elaborating on the broad support implications of the initiative, while noting that the past decade had seen several useful innovations in peacekeeping tools and systems. They included the 2002 creation of the Strategic Deployment Stocks, which allowed missions to be equipped and supplied more quickly than before, and the establishment of a peacekeeping reserve to allow for “commitment authority” of up to million in advance of a Security Council mandate. Yet neither innovation was calibrated to current demands and their ceilings remained static while overall peacekeeping budgets had more than tripled. More of the same simply would not do.

She said a more nuanced, targeted approach was envisaged, with some mission-support elements provided globally, some from a regional centre and others at the level of individual missions. The current model whereby each and every mission had a full support component should be revisited. Options for consideration should lead to: a lighter mission footprint; faster turnaround without compromising accountability and oversight; smarter deployment within security ceilings, with more favourable substantive/support staff ratios; greater use of local staff and local suppliers; development/continuity of staff/ professional expertise in safer, more stable locations; creation of centres of excellence; decision-making and supply closer to the point of delivery; and revisiting the current contingent-owned equipment model, including rates of reimbursement.

It was becoming increasing important to calibrate support to the different stages of the mission life cycle, with different deployment and staffing priorities, as well as equipment and financing needs, she continued, adding that specific support challenges in the start-up had been identified. But even if such improvements were introduced, the Department would still face a system of financing approvals and procurement timelines that limited rapid deployment. Possible ways to address that included: pre-positioned stocks and turn-key service contracts; modular approaches; fast-track, standardized resourcing approaches for a mission’s first year of operation; greater financial flexibility; and more asset-sharing between missions, particularly in the area of aviation.

She went on to say that one way to build capability and performance without increasing the in-mission headcount was to invest more in technology-driven solutions, such as better information analysis, improved communications and higher-performing equipment, among other things. There was also a need to develop a truly global and mobile workforce that was faster, had more targeted recruitment, better skills and career development options, and greater agility across functions and locations. The Department would be developing those themes in the support strategy on which it was working. Following an informal exchange of views with delegates at the end of May, a departmental team was now “drilling down to the detail”, examining the costs and benefits, with a view to sharing a more comprehensive set of proposals in the next session of the General Assembly. It would be a major proposal presented alongside the peacekeeping budget.

Statements

JEAN-MAURICE RIPERT (France), associating himself with the statement to be made on behalf of the European Union, reiterated his country’s suggestion that the two Departments should submit a regular report on both the operational and financing levels. In the three-pillar initiative launched with the United Kingdom, France had called for further improvements in establishing mandates and setting objectives and benchmarks for measuring success in peacekeeping operations. There was also a need to improve command-and-control systems, as well as those for planning and follow-up. It was also important that the Council hold regular meetings with the Military Staff Committee with the involvement of troop-contributing countries. The United Nations should be ready to carry out robust operations and it would be wrong to deny the Organization such capabilities.

Noting that his country was the fifth largest financial contributor, with 200,000 blue helmets, he called for the incorporation of civilian protection in peacekeeping operations. The United Nations must protect those lives since it was on that basis that the Organization would be judged. Internal mission structures must, therefore, be adapted to their mandates. Pointing to the establishment of the United Nations Organization Mission in the Democratic Republic of the Congo (MONUC), he said a major effort must be made in the context of mandates in the early stages of peacekeeping. Establishing levels of priority was particularly important. A coherent approach was absolutely crucial and must be borne in mind when considering every Mission.

Stressing the need for better resources, as well as improved and more economical costing, he said the New Horizon initiative was of key importance in an overall environment of tension and general troop shortages. Underlining the European Union’s efforts to help the African Union, he said further training was needed, as was the participation of staff who could speak local languages, particularly in French-speaking areas. The establishment of reserves and flexibility in financing should be encouraged where viable. France was resolved to continue with the three-pillar initiative and trusted that general guidelines would be adopted in August, during the United Kingdom’s presidency of the Council.

THOMAS MAYR-HARTING (Austria), voicing his delegation’s support for the ongoing focus on peacekeeping reform, noted that it had already witnessed the first changes in the Council’s approach to mandate extensions, including the more systematic use of benchmarks and progress monitoring. Austria had also studied the executive summary of the New Horizons non-paper, which identified key challenges facing United Nations peacekeepers, and looked forward to further details of that most timely initiative. While the Brahimi report remained relevant nearly 10 years on, some of its core issues should perhaps be revisited.

He said that, as a long-standing contributor to peacekeeping operations, his country supported initiatives aimed at improving the Council’s cooperation with troop- and police-contributing countries. Austria called for greater participation by those contributors when the Council was planning or reviewing peacekeeping mandates. Clear and achievable mandates were of key importance to the success of United Nations peace operations and their formulation must take into account all available tools and be based on needs assessment. Given the unprecedented expansion of United Nations peacekeeping and the limits of human and financial resource, other available options for responding to conflicts, especially preventive action, must be considered very seriously.

Lessons learned and the experience of various missions on the ground, particularly national contingents, could provide the Council with comprehensive information for its deliberations on the review and extension of mandates, he said. The early and consistent involvement of force commanders, as well as police and troop contributors, would help create common understanding and trust, as well as increased willingness to effectively implement the mandates adopted by the Council. While the Council bore the main responsibility for crafting achievable mandates, troop and police contributors, as well as other actors, were responsible for delivering on the ground and must, therefore, be given an adequate hearing.

He said that, during last Friday’s debate on civilian protection, his country had reiterated its support for the strengthening of protection mandates in peacekeeping operations. Their role in ensuring physical protection, especially of women and children, was of utmost importance. Their contribution to the promotion of human rights and the strengthening of the rule of law, as well as the increased role of women in peace processes, peacebuilding and the fight against impunity were invaluable. The independent study commissioned by the Peacekeeping Department and the Office for the Coordination of Humanitarian Affairs on protection mandates in peace operations would make important recommendations and add to the overall reform of United Nations peacekeeping operations.

NORIHIRO OKUDA (Japan), welcoming the New Horizon initiative, said his country had three observations on the issue of mandate implementation. First, there should be a common and clear understanding among all stakeholders ‑‑ including major troop- and police-contributing countries, countries in the region and host nations ‑‑ of the tasks given to a mission and the extent to which they were expected to be achieved. Realistic evaluation of the situation in the field was of key importance in formulating a realistic mandate, as seen in Timor-Leste, where the views of countries with direct and broad contact with that country had been highly valuable.

Second, complex and robust peacekeeping mandates required more capable, well-trained troops, he said. Indeed, the quality of personnel was more important than their numbers, and for that reason, the contributor base should be broadened. It was also necessary that the international community further develop the training of troops in a coordinated manner. Japan was working with training centres in Africa to build the capacity of the continent’s forces. Even though they were under United Nations command, the engagement and oversight of the troop-contributing countries over their contingents was essential and should entail the political commitment of those countries to the host nation.

Lastly, he said gaps between expectations and implementation, particularly in the area of civilian protection, could quickly disappoint and undermine the Organization’s credibility, which would in turn make the implementation of assigned mandates more difficult. To avoid that downward spiral, it would be useful to establish a common understanding among relevant partners, including the local population, about the role of peacekeepers on the ground. Sufficient attention to returning to normal life through the early restoration of socio-economic stability would help alleviate any building frustration. The international community should also strive to make accurate assessments of developments on the ground so as to avoid arriving at premature decisions regarding a mission’s mandate and work.

He said that his country, in its capacity as Chair of the Council’s Working Group on Peacekeeping Operations, would spare no effort to facilitate an exchange of views among all stakeholders in order to arrive at workable solutions to current challenges. Recent discussions had focused on formulating a clear and achievable mandate and the provision of necessary resources, the importance of political mandates setting conditions for mission activities, implementing complex mandates such as civilian protection, planning the whole mission cycle, and reviewing the posture of United Nations peacekeeping from a broader, more holistic perspective. Japan was preparing an interim report on those discussions which it would submit to the Council next month.

RUHAKANA RUGUNDA (Uganda) said the number and scope of peacekeeping operations was now stretching capacity, and for many people, the arrival of United Nations peacekeepers, whether or not there was a mission on the ground, played a big role in restoring hope. Many peace missions had been able to live up to those expectations while others had not. Where they had not been successful, they had been overwhelmed by their tasks, and lacked assets, troops or resolve. Overall, unsuccessful missions had lacked a holistic approach to handling specific challenges. The result had been a population with mixed feelings of frustration and often hostility towards the United Nations.

It was, therefore, clear that it was time for a “reality check” so the Organization could learn lessons from the past and build a better future for peacekeeping, he said. Among other things, there was a need for greater and better coordination between the Council, troop- and police-contributing countries, and those facing risks. There was a need for a common understanding of what United Nations peace operations were and what peacekeepers were mandated to do. The Council had been mandating ever more robust missions, of which MONUC was a prime example. There, in addition to traditional duties, peacekeepers where charged with, among other things, monitoring political processes, training law enforcement and disarming foreign combatants, as well as promoting human rights and the rule of law.

Given those challenges, the Council should consider the degree of robustness required of modern United Nations peace missions, as well as the extent of civilian protection initiatives, he said. That would require a clear understating of the situation on the ground before mandates were designed. Clear exit strategies must also be laid out. The Council must also ensure a strong understanding between troop- and police-contributing countries about what was required of peacekeepers and what tasks they would fulfil on the ground. The Council should also expand its working relationships with partners on the regional and subregional levels so as to take advantage of their capacities. It was now clear that no single entity, not even the United Nations, could tackle peacekeeping on its own. The Organization should, therefore, take advantage of the strengths of regional organizations, especially the African Union.

MICHEL KAFANDO (Burkina Faso) said the United Nations should have the tools to perform the task of maintaining international peace and security as effectively as possible, and the Brahimi report was a fundamental document in that respect. However, as time passed, there was a need to give new thought to addressing new challenges. Welcoming the increasing number of Member States getting involved, particularly as troop contributors, he said it was of paramount importance that the Organization be able to mobilize, in good time, as many troops as necessary. All Member States should be able to contribute, as peacekeeping was a collective responsibility, but at present, there was a gap between realities on the ground and the mandates given to missions.

Missions needed realistic mandates and rules of engagement, as well as sufficient deterrent capacity to ensure the success of their operations, he said. With better trained troops and mandates, he said, the Organization would be able to attain short-term goals, but there was also a development aspect, because it was not possible to ensure the durability of the process without addressing the root causes of conflicts. Encouraging the strengthening of partnerships between the United Nations and the African Union, in particular, he called also for the strengthening of the regional body’s capacity.

He said he was disturbed by attempts to impose certain subjective criteria for closing missions, noting that early withdrawal could be costly and sometimes tragic. Financing should be provided for disarmament, demobilization and reintegration. There was also a need for greater efforts to prevent conflicts from breaking out. Mediation and early warning systems were very important in that regard. Troop contributors, the Secretariat, regional organizations and financial partners all had a part to play, and it was important to reduce the gap in communications among all those players, and to involve them at all stages. That would help strengthen trust and enhance the effectiveness of United Nations action.

LIU ZHENMIN (China) said United Nations peace missions now covered traditional tasks, as well as peacebuilding and human rights. As such, the Council must continue to monitor and coordinate the participation of all relevant partners in reforming peacekeeping. Indeed, the effort must be to ensure the overall strategic design and planning of mandates. The Council must also take into account the need for early warning measures and political processes, and ensure there was a peace to keep on the ground.

The Council must also explore other preventive measures, especially given the rising costs of peace missions and the deepening global economic and financial crisis, he said. China also emphasized the need to enhance capacity to raise personnel and equipment in a timely manner. “This is key to the success of United Nations peacekeeping missions,” he said, encouraging more Member States to participate in peacekeeping missions, while at the same time calling on the United Nations to step up its effort to bolster national-level training capacities.

He went on to urge the Council to promote the strengthening of the African Union’s capacity and to enhance its cooperation with that regional body. The Council should also ensure that all its peacekeeping operations adhered to the principle of impartiality. Missions must also be properly managed and have targeted mandates. Furthermore, there was a need to strengthen coordination between Headquarters and field operations. China had always participated actively in United Nations peace operations and supported reasonable reforms. It remained ready to work with others in that regard.

CLAUDE HELLER (Mexico) said special attention should be given to the proposed establishment of a new partnership agenda to strengthen the unity and cohesion of various actors, ensure greater credibility for the missions themselves and strengthen their capacity. In the past, Mexico had drawn attention to the need to identify good practices, given the greater complexity of peacekeeping challenges. Among the main aspects of peacekeeping were centralizing decision-making on the establishment of missions, ensuring leadership in order to determine success, and seeking collective approaches, based on greater coordination. Protecting civilians was also a priority, as was the need to establish greater coordination.

Underscoring the importance of including troop-contributing countries in decision-making while incorporating their knowledge, experiences and practices, he said the current structures and mechanisms for dialogue should be assessed. As the largest Latin American contributor to United Nations peacekeeping, Mexico found merit in the proposal to request the Secretary-General to establish a support mechanism for dialogue with troop-contributing countries within the Secretariat, which could provide support for the process prior to the establishment of specific mandates. It would be also useful to enhance the participation of the Peacekeeping Department and troop-contributing countries in analysing Council-authorized mandates, allowing for timely review of the achievements and challenges of each mission.

The complexity of peacekeeping operations underlined the need to seek flexibility and complementarity among various bodies, he added. In the future, those who contributed through such activities as building of hospitals, support for electoral processes and training could be included. It was important to take advantage of those experiences in designing operations. It was also crucial to enhance dialogue with major financial contributors. In the midst of a global financial crisis, ensuring financial commitments was of ever greater importance. To ensure the credibility and legitimacy of the United Nations, it was necessary to establish peacekeeping operations with proper financial and military resources to fully comply with their mandates.

JOHN SAWERS (United Kingdom) said his delegation supported a new effort to ensure a meaningful dialogue involving the Council, the Secretariat and police- and troop-contributing countries. That would ensure, among all relevant actors, full understanding of the goals of peace missions, more coherent and integrated mission planning and the best use of resources. On the joint United Kingdom-French initiative to improve the Council’s approach to its overall peacekeeping activities, he said progress had been made to ensure the Council was doing its part in managing United Nations peace operations. The goal of that discussion was not to infringe on the wider debate regarding peacekeeping operations, which remained the prerogative of the General Assembly. All bodies of the Organization should work to ensure the best results possible, he stressed.

The evolving nature of peacekeeping called for more comprehensive use of the meetings and structures established by earlier Security Council resolutions, he said, adding that the thematic challenges facing peacekeeping required greater clarity on what could be expected in respect of civilian protection. To that end, the United Kingdom hoped civilian protection could be discussed during the next session of the Special Committee on Peacekeeping Operations. He also stressed the importance of devoting more attention to peacebuilding efforts. Indeed, if the Council was to achieve the national ownership it sought, all actors must strive to ensure that peacebuilding initiatives, particularly those driven by local assets, were in place at the start of a mission.

CHRISTIAN GUILLERMET (Costa Rica) said the Council’s relationship with troop and police contributors had been discussed for more than 15 years, but the level of interaction was still very limited. There was a large gap between the Council, the contributors, the Secretariat and even host countries, though effective interaction was a crucial element of success on the ground. To strengthen that partnership, there was a need for proactive and specific action.

Underlining the importance of changing the Council’s exclusive institutional culture, he said ensuring full compliance with existing standards would continue to be a priority for his country, as would promoting steps to increase the quality of interaction. Costa Rica hoped that one of the results of the United Kingdom-France initiative would be a deepening of interaction among all actors. Costa Rica also viewed positively the efforts by Japan, as Chair of the Working Group on Peacekeeping. Similar meetings would be useful on each specific mission before a mandate renewal was considered.

Noting that the Secretariat could play an important role, he said the Group of Experts on the Protection of Civilians had interacted with the Office for the Coordination of Humanitarian Affairs prior to mandate negotiations though similar interaction was lacking with such entities as the Department of Peacekeeping Operations and the Department of Field Support. Strengthening relations among the main players was everyone’s responsibility. The Secretariat must provide timely information, especially in the times of crisis, and that information should be shared with all Council members, not only the permanent ones.

Host countries should also take advantage of the Council’s public meetings to make their views known, he said, emphasizing the important roles of the Special Committee on Peacekeeping Operations and the Fifth Committee. More substantive interaction among all actors would enable the Council to take better decisions and guarantee more effective implementation of its decisions on the ground. It would also increase confidence and strengthen the partnership that supported and legitimized peacekeeping.

Calling for more creativity in preventing and resolving conflicts, he thanked the Departments of Peacekeeping Operations and Field Support for sharing the principal points of the New Horizon initiative document, saying he looked forward to receiving proposals on strategies to support peacekeeping missions. Costa Rica agreed on the urgent need to build consensus on such policies as civilian protection. The country had long advocated the need to begin a process to define clear and realistic guidelines and training requirements for such additional peacekeeping tasks.

IBRAHIM DABBASHI (Libya) said that, for the past 60 years, peacekeeping operations had been used, with diplomacy and peacebuilding, to ensure broad-based security and stability. Some missions had been outright successes, as in Burundi and Sierra Leone, while some had failed to secure stability and protect civilians in time. Despite that mixed picture, the demand for United Nations peacekeeping had continued to grow, leading to increased focus on adequate mission planning, civilian-protection mandates and the availability of resources. As reform of the Organization’s peace operations continued apace, Libya hoped to hear more about the New Horizon initiative and looked forward to an expanded open debate with troop- and police- contributing countries, as well as other Member States.

Calling for the expansion of the base of troop contributors by providing resources, among other means, he said missions must respect the principles of impartiality, sovereignty and non-use of force. The growing need for such operations required more coordination between the United Nations and regional-level actors, such as the African Union. That regional body had established a Peace and Security Council, which was a special mechanism to monitor peace and stability on the continent. Overall, peacekeeping mandates must include support for strengthening State institutions and security sectors, and shoring up justice and administrative sectors.

SUSAN RICE (United States) said it was clear that United Nations peacekeeping operations saved lives, stopped wars from escalating and spreading, and provided hope to countless civilian populations after decades of despair in such places as Sierra Leone, Haiti, Liberia, and others. But for all the good it did, United Nations peacekeeping faced serious challenges. Indeed, host countries warned that violence might return if missions left too soon. Civilians told of marauding gangs and rebel groups that were often quick to sweep in once peacekeepers withdrew. Troop- and police-contributing countries often complained of a gap between what was asked of them and their level of participation in the drafting of mandates. Meanwhile, Member States struggled with dwindling finances, especially in the face of the ongoing global recession.

Rather than ending when a mandate was outlined, that was when the Council’s responsibilities began, she said. It must, therefore, seek mandates that were credible and achievable, while continuing to weigh the full range of responses to challenges. Rebels and marauding gangs should not be allowed to thwart a mandate or block a United Nations deployment. Peacekeepers must be willing and able to carry out the mandates they had been given. At the same time, the Council must recognize challenges, since peacekeeping missions were not always the right answer. Indeed, regional groups or multinational forces operating under a lead nation might be better options. For example, it had been decided that Somalia was still not yet ripe for a United Nations mission, and the Council had, therefore, supported the African Union-led mission in that country, which urgently needed sustained, if not increased, international support.

Looking ahead, she said her country would strengthen its efforts, with the United Nations and others, to expand the pool of troop- and police-contributing countries. While that would require a lot of work, the United States was willing to consider directly providing more military observers, military and civilian staff officers and other personnel, including women, to United Nations peace operations. It was also prepared to generate the missing force capacity in UNAMID, the United Nations Mission in the Central African Republic (MINURCA) and MONUC to help ensure the protection of civilians in those respective difficult situations. In the meantime, it would continue its global training programme, which had thus far trained some 75,000 peacekeepers and facilitated the distribution of some 40,000 others to 29 operations around the world, mostly in Africa.

She said her country was also prepared to engage in longer-term discussions on rapidly deployable, brigade-sized forces that could help buy time for the United Nations in times of crisis. The United States would also participate more actively in discussions on renewing existing peacekeeping mandates and seek more comprehensive assessment of progress made. The United States planned to launch its new approach in September, within the framework of Council discussions on Liberia and Haiti. At the same time, the United States would not support arbitrary efforts to downsize or terminate missions before such action was warranted. It planned to keep an open mind about reform proposals, including the New Horizon initiative, but remained ready to work with the Council, Secretariat, troop contributors, peacekeepers and all other partners upon whom success depended.

KONSTANTIN DOLGOV (Russian Federation) said any reform should increase the effectiveness of peacekeeping and be carried out in accordance with the United Nations Charter and international law, while taking into account the Council’s primary responsibility for the maintenance of international peace and security. There was potential for reform, primarily in the areas of management and more effective use of regional organizations. Mandates must be clear, implementable and appropriate to the situation. There must be continued improvement in consultations with troop contributors and the Secretariat on all matters relating to peacekeeping, including the level of planning. He advocated greater use of the Working Group on Peacekeeping Operations and called on troop-contributing countries to make more active use of the dialogue format already in place, to keep the Council and Secretariat informed of their assessment of operations under way. That dialogue should be a real two-way communication process.

The Council had a special responsibility to drawing up realistic mandates, he continued, saying such decisions should be based on prior agreement with potential contributors to ensure full staffing and speedy deployment. It was particularly important clearly to define functions in both peacekeeping and post-conflict situations. Peacekeepers should be involved only in the initial stages of reconstruction, and other relevant bodies, including the Peacebuilding Commission, regional organizations and bilateral donors at a later stage. There was a need to ensure the necessary level of military expertise and to involve military experts from Council members in reviewing mandates. Russia had consistently advocated making the Military Staff Committee more active. Its recommendations on operational aspects and in determining the readiness of contingents and infrastructure would provide the Council with reliable information and increase the military expertise of peacekeeping.

He went on to stress the Secretariat’s responsibility for improving the comprehensive planning of operations and coordination between Headquarters and the field, with special attention to improving day-to-day coordination within the Secretariat, while assuring a clear distribution of responsibilities and unified command-and-control. It was important to develop criteria for adjusting mandates, as well as mission deployment and drawdown. The Russian Federation agreed fully with the United States that it would be counter-productive to wind down operations too early. That key approach should be applied to all operations without exception. He also advocated using the expertise of regional organizations, provided their activities were in accordance with the Charter. Alongside traditional partners like the African Union and the European Union, it was important to build up relations with other regional partners, such as the Shanghai Cooperation Organization and the Collective Security Treaty Organization.

HOANG CHI TRUNG (Viet Nam) said that, with the annual peacekeeping budget exceeding billion and the mounting pressure of the global financial crisis, missions had been forced to shoulder a daunting agenda of deploying at a rapid pace into remote areas, maintaining economies of scale, laying the groundwork for sustainable peace dividends and ensuring achievable mandates with clear benchmarks within specific timelines. In the meantime, looming gaps remained between those taking decisions and those implementing them; and those allocating resources and those implementing decisions on the ground, as well as recipient countries.

Calling on the Council, Secretariat and other stakeholders to engage in a thorough consideration of the New Horizon initiative, he said it was important to review existing practices and formulate a comprehensive strategy that would cut across the whole range of activities from concept design to proper planning; from objective analysis to formulation of clear and realistic mandates and provisions of commensurate resources.

Since the Brahimi report, he said, the Secretariat had undertaken a number of initiatives, and a good number of efforts were also under way among various bodies involved in decision-making, including the Fifth Committee, the Special Committee on Peacekeeping, the Peacebuilding Commission, United Nations agencies and programmes and the Working Group on Peacekeeping. Thus, it was fundamentally important to improve the coordination of those efforts to avoid duplication, share best practices and maximize complementarity.

He said reforms should be carried out in accordance with the Charter and universally recognized guidelines, including the consent of the parties, non-use of force except in self-defence, impartiality, respect for the sovereignty and territorial integrity of States, and non-interference in their internal affairs. Troop- and police-contributing countries, most of which were non-aligned and developing countries, should be involved early and fully in the preparation, planning, monitoring, conduct and evaluation of operations.

It was crucial to strengthen the triangular communication among contributors of police and troops, the Council and the Secretariat, he said. Cooperation with regional and subregional organizations could bring added value if they had full understanding of the nature of the situation. It was also important to address the comprehensive political, security, economic and humanitarian dimensions of a given problem. In the final analysis, a lasting solution to a conflict implied the need to go beyond military and security measures, incorporating broader and more effective long-term responses to address the root causes of conflict and promote national ownership.

RANKO VILOVIĆ (Croatia) said traditional peacekeeping was becoming more robust and multidimensional in its approach. It was now often tasked with rebuilding societies from the ground up. Cognizant of that new reality and the need to ensure unity and coherence among all relevant actors, Croatia fully supported the principle that security, development and the protection of human rights should be the focus of all efforts by the United Nations. At the same time, missions must have targeted, clear and achievable mandates, as well as full support from all relevant actors.

The aim must be to help the countries concerned take over ownership of peace processes so that the international community could slowly withdraw, he said. Development ‑‑ civilian protection, security-sector reform, justice and administrative reform ‑‑ was crucial to the success of all peace missions. Meanwhile, troop- and police-contributing countries must be confident that their assets would be supported and their opinions taken into account. The United Nations must improve its cooperation and coordination with regional organizations such as the African Union and the Economic Community of West African States (ECOWAS).

There had been much discussion of the differences between multidimensional and traditional peacekeeping, while very little had been said about preventive efforts, he noted. One example of such a mission was the United Nations Preventive Deployment Force (UNPREDEP), which had been successful in preventing wide conflict in the former Yugoslav Republic of Macedonia during a time of strife in the Balkan region. With that in mind, the Council must consider seriously whether prevention was better and how many lives and resources would be saved if it acted to prevent serious challenges to international peace and security.

Council President İLKIN (Turkey), speaking in his national capacity, said that, while it was preferable to prevent conflict by investing more in preventive efforts such as diplomacy, the need for peacekeeping operations in the real world would not cease to exist. Thus, in conjunction with efforts to better determine when and how best to authorize peacekeeping mandates, the Council must also ensure that the necessary political will and capabilities were in place.

The United Nations faced challenges, including financial shortfalls, shortages of military and other personnel, and general overstretch, he said, noting that the Fifth Committee had approved a peacekeeping budget of some billion. That record amount had been set during a time when other crises, including the ongoing economic slowdown, were straining global capabilities and exerting pressures on efforts to maintain complex and long-running missions. Moreover, the pool of troops was also dwindling as the traditional troop-contributing countries faced increasing difficulties in providing the necessary capabilities. Those contributors were also growing increasingly uneasy with the way in which the Council mandated and ran peace operations.

On the way forward, he said: “We definitely need a compass setting out the agreed and achievable goals and a collective determination of the future of UN peacekeeping.” Implementing reforms, generating resources, building up the necessary capabilities and developing effective partnerships among all stakeholders, as well as improving inter-operability, had turned out to be essential to that end. More rapid and flexible peacekeeping operations required institutional and operational reforms to command-and-control mechanisms, procurement and supply systems.

He stressed that the two central tenets of the Brahimi report should be the guide: deployment of forces should be tied to a viable political strategy; and mandates should be linked to the reality of available resources. “To meet the challenges before us, we need a new coalition, a strategic dialogue, which will include all stakeholders, particularly the Security Council, the Secretariat, the Committee of 34, Fifth Committee, Peacebuilding Commission, and, in some cases, the Office for the Coordination of Humanitarian Affairs, as well as troop- and police-contributing countries,” he said.

JOHN MCNEE (Canada) said that, since the Brahimi report, much of the peacekeeping machinery had been overhauled, but the intervening time had not been wasted and the document’s core logic still prevailed. To achieve peacekeeping goals, it was necessary to complement the partnership between “those who decided, those who paid and those who did”. The participation of regional partners and wider support from the United Nations membership was also important.

The renewed attention to peacekeeping reflected the way in which conditions had changed since 1999, he said. Canada had recently launched an informal thematic series of discussions on the main challenges of peacekeeping, intended to complement the work by Japan, as Chair of the Working Group, the joint United Kingdom-France initiative and the work of the Secretariat. The country would host an upcoming series of follow-up meetings on the future of peacekeeping.

The Security Council was deploying missions in response to the widest complex of challenges in history, he said. However, in many cases, such as the Democratic Republic of the Congo and Darfur, there was a mismatch between mandates and resources. It was important to improve cooperation in dealing with that challenge, which involved the Secretariat and the host Government, among other players. There was a need for improved capacity for strategic planning and for a two-phase approach to mandate-making.

On the political dimension, he pointed out that, while peacekeeping could not substitute for effective peacemaking, many missions were called upon to do just that. There was a need to recognize the critical relationship between peacekeeping and peacebuilding, and to enhance cooperation between the Security Council and the Peacebuilding Commission. A renewed commitment by the Council was also needed to ensure that fragile peace was not derailed by local or regional disputes.

Ensuring appropriate resources and recognizing the increased role of regional players was also vital, he stressed, citing also the need to address logistics, procurement and human resources issues. Clearly, there were no easy answers, but sustained efforts by the Secretariat, the Council and the United Nations membership as a whole would make it possible to renew the Organization’s ability to meet new challenges. Canada stood ready to support that effort.

JOY OGWU (Nigeria) said reform had become inevitable, given the rapid expansion, complexity and multidimensional scope of peacekeeping and humanitarian relief missions. Several operations were constrained by the lack of basic equipment, transport, food and medical supplies, a situation compounded by gaps between mandates, inadequate planning, fluid exit strategies and imprecise relationships between troop-contributing countries, the Secretariat and the Council. Member States needed to forge a consensus on strategies for addressing those challenges, particularly the latter. Consensus was particularly required on the issues of mandates, resources, deployment, exit benchmarking and strategic long-term planning. Considering the relationship between troop-contributing countries and the Council, she noted that the broader and more sustained dialogue envisaged by resolutions 1327 (2000) and 1353 (2001) had not been truly realized.

It was imperative to involve troop-contributing countries from the conception and resolution-drafting stages of an operation to its deployment and final exit, she said. In addition, resource constraints dampened the morale and enthusiasm of peacekeepers and the political will of troop contributors. It was important to ensure adequate and predictable resources to accomplish mandated tasks. Furthermore, adequate pre-deployment training should be a prerequisite to the successful implementation of any mandate. Nigeria supported intensified dialogue and consultations involving the Fifth Committee, the Peacebuilding Commission, the Special Committee on Peacekeeping Operations and the Security Council Working Group on Peacekeeping Operations in order to overcome some of the clearly delineated challenges facing United Nations peacekeeping.

GIULIO TERZI DI SANT’AGATA (Italy) said the Council, General Assembly and Secretariat, as well as outside experts, had undertaken strenuous efforts to review and reform United Nations peacekeeping with a view to making it more effective and efficient and to strengthen its management and financing. As the review turned to the ongoing discussion of a full-time, rapidly deployable peacekeeping force, the Council should consider proposals to use the United Nations Logistics Base in Brindisi, Italy, which had been successful as a deployment hub for equipment and other resources, as the permanent command centre of such a force.

He said there was a need for greater cooperation among the Council and countries contributing troops, police personnel and financial resources. While it was ultimately up to the Council to craft mandates, it must take into consideration the views of those who would carry out its edicts on the ground. As had been shown in Chad, shared strategies could be implemented even in very complicated situations.

Further, since most missions were in Africa, the Council should consider ways to strengthen crisis-management capacity on that continent, he said. It could also consider ways to generate more adequate financial support and ensure better coordination among decision-making bodies within the United Nations and relevant regional actors such as the African Union. Italy, currently President of the G-8, planned to focus on strengthening peacekeeping capacities and structures, particularly in Africa.

MARIA LUIZA RIBEIRO VIOTTI (Brazil) said that chief among the current challenges was the need for the Security Council to provide sustained political attention and guidance not only to missions with accrued responsibilities and needs, but also to peace processes they were requested to support. That was also relevant in dealing with the scarcity of troop-contributing countries. There was a real need to identify new contributors, encourage old ones to resume their contributions and persuade current ones to increase theirs. With more than 85 per cent of mission troops coming from developing countries, it was crucial that the general membership participate in the collective response to meet increased demand for peacekeeping.

She cautioned against generating “a sense of an impeding crisis of peacekeeping or raising doubts about the Organization’s ability to face such challenges”. Rather, it was necessary to reform what must be reformed in a systematic, inclusive and transparent manner, without dispersing efforts in too many initiatives, however well intended. There was also a need to implement fully decisions already made. Higher financial costs were but the logical consequence of establishing new missions and enlarging existing ones, which, in turn, derived from Council decisions.

Closing needed missions or avoiding the establishing operations that the Council considered necessary did not seem to be a judicious response to the financial problem, she said. Rather, host countries and the United Nations must work together to create conditions that would allow for timely drawdown and closing. Also, the term “financial contributors” should not be used in connection with peacekeeping: all Member States contributed to the peacekeeping budget in accordance with their capacity to pay. No hierarchies should be established or encouraged in an issue directly linked to international peace and security.

Emphasizing the importance of close interaction between the Security Council and troop-contributing countries, she said that, in the current reform efforts, it was preferable to improve existing consultation mechanisms than to invent new ones. The key to a mutually beneficial relationship among the Council, the Secretariat and troop contributors was to give their views extensive consideration. First and foremost, that should translate into making better use of the discussions prior to mandate renewal. It behoved the Council to show the political will to mainstream suggestions and perspectives derived from the valuable experiences of troop contributors. Another important step was to engage them in a consistent and sustained manner and not in sporadic fashion. That was particularly true with regard to reform initiatives.

KHALID ABDULLAH KRAYYEM SHAWABKAH (Jordan), endorsing the statement to be made on behalf of the Non-Aligned Movement, said his country’s commitment to the maintenance of international peace and security was reflected in its role as one of the Organization’s main contributors of troops and police personnel. Among the main challenges that must be addressed today were the Council’s relationship with troop contributors, financial contributors and host countries. The Council must involve troop-contributing countries in the new peacekeeping initiatives and invite them to participate in meetings and consultations. The success of efforts to develop and support United Nations peacekeeping also required fostering confidence among regional groups.

Calling for a reform of the Council’s modus operandi as far as its relationship with troop contributors was concerned, he emphasized the significance of particular procedures to enhance that dialogue. It was important to foster the relationship between those who planned and determined mandates on the one hand and those who carried them out on the other. Troop contributors must be involved in decision-making early in the planning stage and participate at all stages of missions, especially before mandate renewal. There was also a need for complete implementation of resolution 1353 (2001) and the Memorandum of the President dated 14 January 2002 in a manner that would lead to maximum use of existing mechanisms.

SAADIA EL ALAOUI (Morocco), speaking on behalf of the Non-Aligned Movement, said Member States had not had sufficient time to assess the impact of such recent reforms as the restructuring of the Department of Peacekeeping Operations and the creation of the Department of Field Support. The merit of any new initiative or process, whether driven by Member States or the Secretariat, should be carefully gauged in the context of its relevance and coherence with ongoing reforms. Peacekeeping should observe the purposes and principles of the Charter and abide by the guiding principles of consent of the parties, non-use of force except in self-defence, and impartiality. Also important were sovereignty, political independence, territorial integrity of all States and non-intervention in domestic matters.

Troop-contributing countries should be involved in the planning process and in all aspects and stages of peacekeeping missions, she said, stressing that their first-hand experience would contribute to an objective assessment of where and when to deploy or strengthen and where to cut or draw down. Triangular consultations between them, the Security Council and Secretariat must be energized in a meaningful manner. It was important to build on the frequency of private meetings with troop contributors and briefings by the Secretariat.

Peacekeeping operations could not continue to be supported by only a portion of the United Nations membership, she emphasized. All developed countries must engage their troops in the field under United Nations command and control. The entire membership should deal with the difficulties stemming from deployment in hostile environments and difficult political contexts. Furthermore, much broader contributions by all Member States would ensure unity of vision. Also required was a comprehensive planning process to ensure mission coherence, clear lines of command and control, integration of mission components, training, deployment, resources and guidance for the Departments of Peacekeeping Operations and Field Support to manage the missions. Troop-contributing countries could provide much-needed expertise on the way forward.

MARTIN PALOUŠ (Czech Republic) speaking on behalf of the European Union, said it was in the international community’s collective interest to ensure the effectiveness and efficiency of United Nations peacekeeping. The European Union had actively participated in the discussion on how to address the current challenges to peacekeeping, launched this year by France and the United Kingdom, and welcomed the consultation process launched by Canada. It also welcomed the launch of the New Horizon, as well as the momentum that initiative and others were gaining. It looked forward to the upcoming debate during the United Kingdom’s presidency in August, which would focus on the Council’s efforts “to get its house in order”. That should spark a wider debate throughout the Organization on complex mission mandates.

He went on to say that, as the complexity of peacekeeping missions and their operational environment increased, it was important that decisions about appropriate responses by the United Nations were taken in consultation with those who carried them out. While recognizing the Council’s primary responsibility for maintaining international peace and security, the European Union would stress the need to improve and expand existing consultation mechanisms between those who planned and managed operations and those who contributed troops and funding. That would ensure more coherent and integrated mission planning, improved command and control of operations, and smoother and more effective mandate implementation.

Calling for improvement in the cooperation between troop- and police-contributing countries, the Department of Peacekeeping Operations and the Department of Field Support, he said the Secretariat should improve the timeliness and flow of information by organizing regular meetings of troop and police contributors prior to Security Council deliberations on specific mandates. The European Union concurred that there was a need to broaden the base of contributors and in that regard, would welcome greater calibrated incentives for providing necessary capabilities. The European Union contributed some 40 per cent of the peacekeeping budget and 12 per cent of the troops, but it recognized at the same time that there might be more it could do to make smarter use of available capabilities.

FARUKH AMIL (Pakistan) said peacekeeping was the face of the United Nations and its flagship enterprise. While retaining its traditional purpose, peacekeeping had also evolved over time, reflecting the increasing complexities of conflict. Success in recent years, especially that of multidimensional operations, had led to raised expectations, increased demand and the attendant planning and management challenges, including the need to bridge the gap between mandates and resources. While efforts to reform United Nations peacekeeping activities were clearly under way, Member States had not yet had the opportunity to fully and properly assess and review the results or impact of that exercise.

“We do not have a clear idea of how effectively the new mechanisms and structures are performing,” he said, adding that, in the meantime, new plans by some Member States and the Secretariat continued to be put forward. Pakistan’s preliminary analysis of such initiatives was that, while they could become catalysts for discussion, there was little new in respect of dealing with the major lingering issues or challenges. Pakistan wondered whether it was a question of exposing the limitations of past reforms or a question of fully implementing them through a sustained effort. The value of those initiatives lay in considering them in an open and transparent manner, within the framework of ongoing processes to ensure coherence and the best results. “Apart from the Security Council, the C-34 remains the best forum to discuss all these issues in a comprehensive fashion,” he said.

He went on to say that it would be more productive if meetings between the Council and troop-contributing countries were held more regularly and coincided with the Council’s consideration of new missions, as well s its review and renewal of existing mandates. Moreover, focused discussion of ground realities, operational issues and challenges could benefit from the participation of, and feedback from, troop-contributing countries. Pakistan, the largest contributor of troops, was in favour of expanding the base of troop contributors and decision-makers. Such expansion was essential for maintaining the credibility and legitimacy of peacekeeping operations. Matters of command and control were not limited to “consultations”, he said, calling for enhanced and visible representation of troop-contributing countries at the highest level at Headquarters and in the field.

ALFRED NDABARASA (Rwanda) said his country’s commitment to peacekeeping was born of the 1994 genocide and the international community’s failure to respond in a timely and decisive manner. Rwanda’s experience should not be revisited anywhere and the country was proud to support United Nations peacekeeping operations in the Sudan, Liberia, Chad, Côte d’Ivoire and Haiti. Given the changed nature and complexity of peacekeeping, it was imperative to undertake a complete rethink of peacekeeping operations.

In light of today’s challenges, force preparation was essential for a successful mission, he said, adding that a well-prepared force was in a much better position to effect adequately the mandate assigned to it. A number of Member States, particularly from Africa, were committed to peacekeeping, but the international community had failed to provide equipment such as helicopters to missions like UNAMID. That impeded the mission’s mobility and effectiveness and had an impact on force protection.

Timely reimbursement of troop- and police-contributing countries would certainly go a long way in sustaining and maintaining available equipment and ensuring that peacekeepers were able to execute their mandates, he said. It was also important to have access to accurate real-time information in conflict areas. The Department of Peacekeeping Operations should urgently explore partnerships with regional organizations and countries to share such information. In view of the Prodi report, the international community should also consider strengthening regional standby forces, particularly in Africa, in coordination with regional organizations.

A review of peacekeeping policy through consultations with Member States and relevant United Nations organs was crucial, he said. It would, for example, be advisable for the Secretariat to have the flexibility to review policy on contingent-owned equipment instead of waiting for the relevant working group to sit every three years. Resolution 1353 (2001) recognized the need to strengthen cooperation between the Council and troop-contributing countries. Through strengthened cooperation and political will it was possible to achieve effective and credible United Nations peacekeeping into the future.

JUAN ANTONIO YÁÑEZ-BARNUEVO (Spain) said the Council should schedule at least three meetings per year to update the wider membership on the state of peacekeeping reform efforts, and deepen its interaction with troop- and police-contributing countries. At the same time, the Charter provided that the General Assembly should receive regular reports from the Council on its efforts to maintain international peace and security. To that end, the Council should enhance its cooperation with the Assembly’s Special Committee on Peacekeeping Operations, as well as other bodies dealing with the subject.

He said his country had been participating in United Nations peacekeeping initiatives for some 20 years and welcomed the initiatives highlighted today by Under-Secretary-General Le Roy. At the same time, Spain would stress the need for all such initiatives to be closely coordinated so as to avoid duplication of efforts, especially in light of the ongoing global economic downturn.

The United Nations must work in coordination with regional and subregional organizations, he said, noting that peacekeeping operations were expensive. The Organization must use all mechanisms at its disposal, including preventive diplomacy and regional-level contacts. It must bolster its efforts to enhance local-level training and capacity-building to assist in its peacekeeping efforts. Continued involvement by all players in all peacekeeping activities, including mandate creation and review, was crucial to ensuring the success of such missions.

HARDEEP SINGH PURI (India) said that, as one of the main contributors to United Nations peacekeeping operations, his country brought to the table a unique combination of commitment, knowledge and experience. It was a self-evident truth that there was no scarcity of personnel and capacities of the type that the Organization required. The problem was the reluctance on the part of Member States to make them available. A major issue that must be tackled in that connection was the nature of the Council’s mandates and the manner in which they were generated. Related to that was the question of whether the mandates had any correlation to the Organization’s ability to deliver. India endorsed fully Under-Secretary-General Le Roy’s statement that peacekeeping mandates had become too broad and all-encompassing, and that the limits of “robust” peacekeeping were not properly defined.

He said unrealistic mandates had led to situations where mission personnel were forced to ask national contingents to undertake tasks and utilize contingent-owned equipment in a manner that was inconsistent with the legal framework under which they were deployed. Mandates must be clear and achievable, but that would not be possible without substantively involving countries that could contribute manpower and resources. Consultations with and briefings for troop- and police-contributing countries were pro forma in nature and skirted around substantive issues, with little or no scope for meaningful discussion. The most recent change in the rules of engagement and concept of operations for MONUC had been communicated to troop contributors after they had been notified during a consultation meeting. Being informed was not the same as being consulted.

In conclusion, he reiterated the imperative of involving troop and police contributors early and fully in all aspects and stages of mission planning. The future of peacekeeping, and at least a part of peacebuilding, lay in the development of police and the rule-of-law capacities of missions. The most relevant capacities in that regard were present in Member States that had gone through successful post-colonial nation-building. Training national security personnel was a key determinant of success in enabling national capacities. Training capabilities must be built into the force generation process by which contingents were raised. Attention should also be paid to mission support.

In connection with the creation of the Department of Field Support and the realignment of the Department of Peacekeeping Operations, he stressed the requirement of unity of effort and the establishment of clear command-and-control structures, coherence in policy and strategy, effective coordination and integration. India would like the New Horizon initiative to be an exercise that took “a clear, hard look” at where the Departments of Peacekeeping Operations and Field Support required focusing. India had engaged with the Department of Peacekeeping Operations on the study, but did not have the impression that the product of that exercise would influence the manner in which the fundamental issues were being addressed.

PARK IN-KOOK (Republic of Korea) said the magnitude and complexity of today’s peacekeeping transcended what the Brahimi report envisaged 10 years ago. It was clear that the current overstretch would continue to be aggravated in the coming years. Welcoming the New Horizon project as one of the answers to the new set of challenges, he said Canada, his own country and many other Member States had organized brainstorming sessions to discuss and share their views on the future of United Nations peacekeeping.

Missions needed clear mandates, priorities and political strategy, he continued. The importance of clear, credible and achievable mandates had already been raised in the Brahimi report, but only a few missions had been given a developed list of mission priorities. Without that, the effective mapping of resources with mandates was not possible. Maintaining the balance between consensus and efficiency would be crucial. Also required were clear exit points and responsible exit strategies.

In that connection, the role and early engagement of the Peacebuilding Commission might be explored, he said. Among its many functions, the Commission’s country-specific mechanism could work as a responsible exit. To fully integrate that potential, peacebuilding activities should be integrated into peacekeeping operations from the earliest stage, and a strategic partnership between the Council and the Peacebuilding Commission should be activated in a more genuine sense. Preventive actions or alternatives to “heavy” peacekeeping operations must be actively pursued. Although a peacekeeping mission was less costly than other military options, mediation, civilian and military observers, police observation and preventive deployments were more cost-effective.

He also advocated the development of partnerships with regional organizations, civilian partners and the private sector, calling for the development of a concrete and comprehensive model or modality of such cooperation. The Prodi report would serve as a good basis for the discussion. Also of key importance was a global, responsive and rapid deployment system. The Government of the Republic of Korea was considering establishing a standby force that could be deployed in a timely manner. On the support side, the creation of the Department of Field Support was one of the major reform successes.

LESLIE K. CHRISTIAN ( Ghana) said the Organization’s ability to surmount current and emerging challenges, while also bridging gaps between its capacities and the expectations of the international community, depended largely, though not exclusively, on the adoption of unambiguous, realistic and achievable mandates and exit strategies, in tandem with parallel and inclusive peace processes. It was incumbent on the Council, within the ambit of its responsibilities, to consider refining mission mandates to account for envisaged challenges in the field, including by adjusting the rules of engagement for field personnel, as and when needed, practical deployment timelines, and increased authority for field operations.

Since a mandate was not an end in itself, its objective could only be realized through the provision of requisite human, financial and logistical resources, he said. The logistical difficulties faced by troop-contributing countries had been identified as a major impediment to prompt and effective deployment. To that end, those countries should be involved early, at all stages and in all aspects of mission planning to contribute to a more inclusive decision-making process. The Council must, therefore, examine critically its current working methods with the aim of eliciting the views of troop- and police-contributing countries before it adopted a mandate.

The safety and security of peacekeepers was a major concern, he stressed. Ongoing fatalities were indefensible in light of the selfless services the peacekeepers rendered. Given the grave and dangerous atmosphere created in the current era of intra-State conflicts, and until the restoration of relative normality in such conflict areas, the United Nations should assume responsibility for the safety and security of peacekeepers. Ghana welcomed the progress made to that end, thus far and encouraged the Secretariat to continue enhancing its capacity, especially in the gathering of operational and tactical intelligence, which was essential to pre-empting potential threats and ensuring the safety of both peacekeepers and civilians.

MADHU RAMAN ACHARYA (Nepal) said the ability of the United Nations to deploy peacekeeping missions in time and where they were most needed faced serious challenges. Indeed, missions were often left without political support or a workable exit strategy. In some missions, moreover, there was a gap between peacekeeping and peacebuilding. The Council and the Peacebuilding Commission were both operating without clearly defined responsibilities and as such, the entire Organization’s peace operations required comprehensive review in order to help close gaps in failed or failing States or transition societies following conflict.

At the same time, he said, any recommendations emerging from such a review would only have real meaning if they enjoyed broad-based support from the Organization’s wider membership, including the General Assembly, troop- and police-contributing countries and the Council. As things stood now, Nepal, a troop-contributing country, was at the end of the spectrum. “Our troops are called to participate in missions in which we are not involved in mandating and planning, let alone in determining the political strategy,” he said, adding that his country’s troops were also asked to implement complex mandates without much operational flexibility and through the application of rules they had not helped develop.

He said his country’s troop strength was becoming overstretched and by the end of 2009, its troops in the field, numbering some 3,800, would jump by a third after it sent peacekeepers to take part in UNAMID. There was, therefore, a strong case for building the capacity of willing troop-contributing countries for swift deployment with the required equipment and professional capability to undertake complex and robust peacekeeping operations. At the same time, enhancing the pool on key equipment was also important. “We should not undermine the importance of having developed countries share some of the burden of troop contribution in difficult peacekeeping missions so as to make peacekeeping a truly effective global partnership,” he added.

MARTIN NEY (Germany), associating himself with the European Union, said United Nations peacekeeping was a success story, while not free of setbacks and criticism. Such an endeavour required focus, which would separate the urgently necessary from the long-term desirable ‑‑ a separation made necessary in part by limited availability of resources to cope with all the crises at hand.

Among the most important elements discussed today was improving and expanding existing consultation mechanisms, he said. An intensive dialogue with all stakeholders, above all the Member States contributing to peacekeeping, was absolutely essential. Before the Council adopted a resolution, it needed a clear understanding of the operational assets available. The Council should be fully advised on the availability of operational and logistical capabilities prior to making a decision on a new mandate or a major change to an existing one.

With regard to the New Horizon project, he proposed that it should not end with another non-paper. It was necessary to aim for a document based on the consent of all, thus providing a tangible basis for decision-making and execution. Germany would also like the principles and guidelines of peacekeeping finalized and made accessible to all contributors, “rather sooner than later”.

MAGED ABDELAZIZ (Egypt) said a major part of today’s situation stemmed from non-implementation of the Organization’s expected role in preventive diplomacy and conflict prevention, and from its inability to address the root causes of conflict and transform peacekeeping missions into missions for managing conflicts. Egypt proposed addressing peacekeeping as one of the tools available, within a series of political tools that started with preventive diplomacy, mediation and reconciliation, continued with peacekeeping, and finished with peacebuilding and supporting developmental long-term capacities.

He also emphasized the need for clear mandates and cohesive political and military planning, the importance of exit strategies and parallel political processes, and the need to enhance trust among peacekeeping parties in the Council, the troop-contributing countries and the Secretariat, as well as trust and consent on the part of host countries. The partnership among those parties represented the base of the United Nations peacekeeping’s legitimacy and sustainability. The participation of troop contributors should be expanded from the beginning of planning and establishing missions to the end of their assignment.

It was also important to expand the base of contributors and partners in peacekeeping and invest in developing the capacities of interested countries to be more capable of contributing, he said. Addressing peacekeeping should not be limited to its financial scope, but should also strengthen the links connecting peacekeeping, financial and political frames, peacebuilding and comprehensive development.

He said other important elements of peacekeeping included strengthened cooperation with regional organizations under Chapter VII of the Charter, improvement of the procurement system and field support, early deployment, development of Secretariat-related bodies, and increased coordination among the Department of Peacekeeping Operations, the Department of Field Support and the Department of Political Affairs. It was also necessary to avoid disputes between the Security Council and General Assembly, and to strengthen the role of the Special Committee on Peacekeeping Operations. The Council should not attempt to micromanage the Secretariat’s work, particularly in the area of selecting contributing countries to any operation.

SHABBIR AHMAD CHOWDHURY (Bangladesh) said it was now more necessary than ever to develop a genuine and meaningful relationship between those who planned, mandated and managed peacekeeping operations and those who implemented the mandates. The issue of consultations with troop-contributing countries had seen many initiatives and consequential arrangements, in particular, the Council’s adoption, in June 2001, of its landmark resolution 1353, which provided the format for such consultations. After eight years, it was prudent to examine whether the scope provided by that text had been explored.

While taking decisions on peacekeeping operations, it was important for the Secretary-General to include in his regular reports to the Council information on the views expressed by troop-contributing countries, he said. At the same time, it was necessary to take into consideration the provisions of resolution 1327 (2001), which underlined the importance of an improved system of three-way consultations to foster a common understanding of the situation on the ground, the mission’s mandate and its implementation. That text provided for private meetings with troop contributors when considering amendment, renewal or completion of a peacekeeping mandate, or when a rapid deterioration in the situation threatened the safety and security of peacekeepers. However, any Secretariat briefings to the troop-contributing countries should take place well ahead of mandate renewals and new mandates.

In order to develop effective interactions, it was important to make operational the available courses of action, as specified by the Council and other bodies like the Special Committee on Peacekeeping Operations, he said. A meaningful consultation with troop contributors was a necessity. Their views had to be taken into account. Given their wealth of experience and expertise, as well as their commitment, troop contributors were in the best position to contribute to the process of mandating, planning and implementing peacekeeping operations. The sense of ownership could be an added asset. As for the New Horizon initiative, any new reforms should include a thorough assessment of the recent restructuring. It was the prerogative of Member States to consider any proposal.

JOSÉ LUIS CANCELA (Uruguay) said there seemed to be a consensus on the necessity of a more fluent, substantive and consistent exchange of views with troop-contributing countries. In that respect, first-hand data, as well as the experience and perspective of countries with troops on the ground could be quite useful to the process undertaken by the Council to gain an understanding of the situation and in considering threats and opportunities in the field. Moreover, one could not underestimate the value of broad-based support for mandates approved by the Council, particularly in light of the new tasks incorporated into them, such as civilian protection.

By large, developing troop-contributing countries were the ones that had to implement the mandates on the ground, he emphasized. However, they had very limited possibilities of participating or influencing the mandates. In that sense, he highlighted the important effort made by Member States last March, when the Special Committee on Peacekeeping Operations had decided to address the issue for the first time. From the briefing on the New Horizon non-paper, the idea of building a new agenda for partnership would follow in the same direction.

Advocating better use of the opportunities already in place, he said the dialogue with troop-contributing countries should precede the approval and renewal of mandates. In that connection, he highlighted the positive experience of a meeting of the Working Group on Peacekeeping Operations, convened by Japan several weeks ago, saying Uruguay had presented its perspective and concerns about the United Nations Stabilization Mission in Haiti (MINUSTAH) and MONUC, two missions in which its troops participated. For a small developing country like Uruguay, it was difficult to uphold the intensity of its participation, when delays in reimbursement were so significant, he said. That situation affected many troop-contributing countries, most of which were also developing countries. In spite of the global economic crisis, and the fact that the peacekeeping budget had increased to billion in 2009, it represented only 0.55 per cent of the global military expenditure for 2008.

ALICE AGHENEBIT MUNGWA, Senior Political Affairs Adviser, Office of the Permanent Observer, African Union, said issues of peace and security ranked high on the regional body’s agenda. The African Union peace and security architecture, monitored and implemented by the Peace and Security Council, had been based on past lessons learned and would ultimately be supported continent-wide by the African Standby Force, and a “Panel of the Wise”.

However, she stressed that the launch of that effort was facing the expected “teething problems” in its administrative capacities, field experience and general operation, and suggested that the Security Council place a special emphasis on strengthening coordination and support for all regional organizations, including the African Union, especially as the New Horizon initiative got under way.

She said the African Union had always reaffirmed the Council’s responsibility in the maintenance of international peace and security, and considered that joint missions with the United Nations were operated on behalf of the Council. Welcoming the partnership framework introduced by Under-Secretary-General Le Roy, she said the African Union was a “natural and integral part” of that initiative. The regional organization’s activities had clearly demonstrated its resolve to take its fair share in ensuring international peace and security, ownership in building new hopes for peace and stability, and in development in Africa and around the world.

Mr. LE ROY, responding to comments, said the debate had been very “dense” and would certainly inform his Department’s ongoing efforts regarding the New Horizon initiative and towards enhancing coordination and cooperation with troop- and police-contributing countries. At the same time, the New Horizon non-paper was not the end but the beginning of the process, and consultations on it would continue, including with the Special Committee on Peacekeeping Operations, for final submission to the wider General Assembly before the end of its sixty-fourth session.

Ms. MALCORRA, in her concluding remarks, outlined the next steps in connection with peacekeeping, saying that the New Horizon initiative was “a chapeau work” that integrated different initiatives, including the support strategy briefly addressed today. The non-paper would be issued in July to serve as a basis for further consultations. “We have listened and we’ll continue to listen so that by the time the final document is submitted, the concerns of Member States are well understood and taken into account.”

CHINA-Recessionary Spiral?

Source: South Asia Analysis Group

Guest Column by Dr Sheo Nandan Pandey

Introduction

The People’s Republic of China (PRC) has been caught on its wrong foot in its mimic of the free market economy of the west and export led growth model of the East Asian tiger economies of yesteryears. It is in a wind, and has little room to get off the spate of recessionary spiral with pep talks, earlier run through on war footing, with the Chinese President Hu Jintao, Premier Wen Jiabao, Foreign Minister Yang Jiechi, and Governor of the People’s Bank of China (PBOC) Zhou Xiaochuan in the lead role.[i] World Bank (WB) projections seem far off the ground realities.[ii] Worse, for most part, the primary reset and recovery parameters stand frozen, if not immune to active monetary and fiscal policy instruments. [iii]

Annual rate of growth of China’s gross domestic product (GDP), for example, touched the nadir 6.1 per cent year-on-year during the first quarter of 2009.[iv] It was 4.5 percentage points lower than the first quarter of 2008 and down 0.7 percentage points from the previous quarter. When calculated quarter-on-quarter basis, the scenario is still more depressing. The decline has been continuous and sharp right since the global down turn gathered momentum. Earlier, during 2003-2007, the PRC had experienced double-digit growth. It registered 9 per cent growth in 2008. The drop down as such accounts for less than half to its peak performance. Aggregate demand for goods and services, in particular its external component remains substantially weak. Output glut, massive lay offs, shutdowns, drop in energy consumption, decline in output, fall in government revenue and increase in budget deficits, cutback in private investments and the like tend to rule the roost. Among the Chinese think-tanks, Fan Jianping, the Chief Economist of the State Council Information Office, has been the sole exception to speak out the ground realities and indicated loose ends of the Chinese capabilities to early reset and recovery. [v]

In the short run, China’s absolute as much as relative capability to ward off recession and/ or early reset remains dependent on creating effective demand for the entire range of goods and services in the home and new foreign markets, plummeting under the weight of the global down turn. There is since then a stimulus package, made up of both monetary and fiscal policy instruments, in place.[vi] However, in the best of times, it could be effective only if there was an inelastic demand for the goods and services. The ground situation in China was just the opposite. Drop in the demand for exportable goods and services relate to totally elastic demand. The demand for capital and wage goods in respect of low income as much as laid off workers fall in a little different category. For long term solutions, China has but to make paradigm shift in technology, product mix, direction of product markets, and the like.

China’s rescue potentials to a single and / or group of countries, in the short run, again stand constricted to handful of goods and services. It would largely relate to wage and capitals goods with highly inelastic demand. The same would hold good for services as well. The scope is, of course, quite large in the long run. Other things remaining the same, it would pertain to large number of wage goods, offering comparative advantage. It would relate to still larger number of capitals goods, needed for improving the competitiveness of Chinese products, in particular environment friendly and energy efficient technology. The upper limits of such rescue potentials are set by an array of variables, the most critical ones being the comparability and compatibility of the GDP and disposable incomes. While considered 3rd largest economy, its share in the global GDP is just 6 per cent.[vii] The distribution of income being skewed, the average disposable across the country and social groups suffer handicaps of being representative in character at macro level. China’s foreign exchange reserve of US$1.92 trillion was again not as liquid as people normally think. Where China could hold this option, it was but at a high premium. The pep talk could turn a reality only when the rest of the world turned a corner with their stimulus package.

The paper essentially aims at probing into the plausibility of early reset and recovery of the Chinese economy in response to the interventions, essentially composed of monetary and fiscal policy instruments. [viii] In the run up, it would focus on: the Onset Factors and Features of the Bust Cycle; the Monetary Policy Instruments and their Liquidity Raising Potentials; the Fiscal Policy Instruments and their Purchasing Power Raising Potentials; and, the Actualization Process and Simmers.

Assumptions of the study include: first, the phenomenon, thus far globally synchronized and essentially part of boom and short cycles, is the inevitable and yet, necessary cost of capitalism; second, the current economic malaise, in global and not just Chinese context, is the outcome of too much reliance on the prescriptions of both the Keynesians, like Paul Krugman and the classical economists, like Milton Friedman. The transmission mechanism for monetary policy, as Hyman Minsky advocates, is through the financial markets and, the financial markets can experience wide swings that lead to booms and busts in the real economy; third, the Chinese monetary and fiscal policy instruments, tailored respectively to prime and/ or pulsate otherwise shutting down export oriented enterprises and dormant domestic demand for their products, stood witness to China’s transition to inclusive in place of buoyant exports-led growth and development model; fourth, the streaks of simultaneous down turn and up rush symptoms, currently discernible in the Chinese economy, is but a product of endemic characteristics of Chinese economy, largely a feature of simultaneous existence of the new and traditional, the high and low tech, the broad based and selective etc. features in structures and functions of different economic sectors; and, the sixth, the most and least affected geographic region, enterprises, urban/ rural residents, high and low income susceptible families are bound to respond differently to the interventions for a host of regions. At long last, at macro level, the imminent problem before the People’s Republic of China (PRC) was to reverse the slide down in the GDP growth, the minimal level of which is 8 per cent and more lest the wherewithal of expansionary Chinese socio-economic structure should crumble.

Onset Factors and Features of the Bust Cycle

The PRC got to the bust cycle after decades of boom. The peak and trough, thus far unveiled, carry some exclusive features. The new and unanticipated aspects would call for a new approach and treatments for recovery. It does not turn history outright obsolete. The situation is essentially borne of calculated risk suffering toll of exuberance. Robert J. Barbera is perhaps right that the society which enjoys the fruits of free market has to be ready for pay up for periodic down hill.[ix]

Prior to the bust, the GDP of China had peaked 13 year best of 11.4 per cent year on year to RMB 24.6619 trillion Yuan (US$3.43 trillion). The growth rate was 0.3 percentage points higher than the 2006 level revised at 11.1 percent. [x] Quarter wise, the GDP in the PRC in 2007 had expanded 11.1 percent in the first quarter, 11.9 percent in the second, 11.5 percent in the third and 11.2 percent in the fourth. Now, as the Chinese economy got caught up in the loop of global recessionary spiral, the growth rate has tumbled 5.8 percentage points in comparison with the best fit of the second quarter performance and 5.3 percentage points of the annual average.

The “credit crunch”, as term for financial market, was first heard in China in the third quarter of 2007 while it came to public attention to the outside world in August 2007.[xi] It happened just when the US economy encountered bust in Dec 2007.[xii] US GDP then grew by 0.6 per cent compared with 4.9 per cent in the previous quarter. Ireland, Denmark, Finland, New Zealand, Sweden, Austria, Germany, Italy, Japan, the Netherlands, the United Kingdom, Portugal, Spain, and Switzerland have had recession ranging from two to seven quarters.

Much has happened due to China’s export-led developmental paradigm turning unsustainable. When the growth rate of the Chinese economy peaked to 11.4 per cent, the contribution of export proceeds ran to 40 per cent. According to an estimate, 1 per cent growth in China’s exports contributed 0.82 per cent increase in the GDP of the PRC. As the global economy, in particular US, European Union, Japan and other notable export destinations of China fell into the whirlpool of recessions, Chinese exports got a bloody blow. In the very first punch, as the Chinese Commerce Minister then acknowledged, the slow down in exports to US and EU in the first quarter of 2008 caused 12 percentage point drop in China’s over all export growth. [xiii] Not surprising that the Chinese economy cooled to its slowest pace in 2008, expanding 9 per cent year-on-year, the slowest since 2001. In the first six months of 2008, as many as 67000 small and medium enterprises (SMEs) pulled down their shutters. Industrial output dropped 5.6 percentage points. [xiv] 20 million workers were laid off. The trend continues even now and reset, much less recovery awaits China’s alternate consumer-led developmental paradigm to hold ground.. [xv]

Chinese recession, for reasons as such, now stand globally synchronized. As the epicenter happened to be the US, and the aftershock is spread across all continents, the duration and amplitude of recovery of the Chinese economy has but to take place along the rest of the world. While external shock is largely responsible for rocking the Chinese boat, the correctives have but to take care of side effects of an array of other shocks, in particular those which carry bearings on competitiveness of Chinese goods and services.

Monetary Policy Instruments and their Liquidity Raising Potentials

As part of monetary policy manoeuvres, the People’s Bank of China (PBOC) switched over to “moderately easy” from “tight” monetary policy”.[xvi] Chinese tend to call the moderately easy monetary and fiscal policy options as “prudent” as against tight. There is then “active” monetary and fiscal policy that stands for easy monetary and fiscal policy. As Zhou Xiaochuan, the Governor of PBOC told 11th National People’s Congress (NPC) session in Mar 09, the objective in policy shift was to “check slip of confidence and spur fast recovery of the economy amid the crisis”.

China had cut interest rates for the first time in six years on Sept. 15, 2008. This was the time when Chinese economy had got to experience the heat of worsening credit turmoil and weakening export demand.[xvii] The one-year lending and deposit rates were lowered by 0.27 percentage point to 6.93 percent and 3.87 percent. In three months thereafter until Dec. 23, 2008, the PBOC announced as many as five cuts in the interest rates, down from 7.47 per cent to 5.31 per cent. The deposit rate was always cut by the same amount, down from 4.14 per cent to 2.25 percent.[xviii]

The PBOC simultaneously brought about cuts in the reserve requirement ratio (RRR) of large and small as well as medium sized banks in five subsequent different stages from 17.5 per cent. For small and medium sized banks, it was trimmed to 13.5 per cent. In the case of large banks, it was kept at 15.5 per cent.[xix] The mechanism is meant for influencing the rate of money supply. A lower RRR as this against a higher RRR obviously gives greater leeway to the commercial banks for lending money to the market.

The credit ceiling of the Chinese commercial banks in respect of priority projects, rural areas, smaller enterprises, technical innovations and industrial rationalization through mergers and acquisitions. It was in tandem with the policy decision to keep credit expansion "rational" and "target specific”. 1% in lending results in a 0.105% increase in money supply.

China followed a differential loaning policy to jack up demand for the worst affected industrial products, in particular automobiles, electronics and the like. Lower upfront payments and subsidies of different kinds including coupons constituted major devices.

China’s current account surpluses do as well contribute to add to the liquidity position with a difference. In order to achieve its exchange rate objectives, the Chinese government has to buy hard currency, in particular US dollars or else RMB would appreciate. In order to buy these dollars, it has been printing RMB, which, in turn, goes to increase the amount of money in circulation. There are estimates that a 1% increase in China’s Foreign exchange reserves would require a 0.111% increase in money supply to sterilize it. The figure could grow with the increase in the volume China’s Foreign exchange reserves as time passes.

Overheating of the economy being a constant feature, the PBOC has taken recourse of ‘punishment bonds’, issued to commercial banks at variable maturities and interest rates with obvious goals of putting reins on money supply. In 2008, the PBOC issued Rmb4.3trn of bonds in this way.

Chinese academics held positive and yet, hold differing views on the impact of the monetary policy interventions. Jin Xin, an Everbright Securities Analyst, held it good news for the banks, whose profitability has been deteriorating. Jin said the move would widen the gap between the lending and deposit rates, which is where banks make money. As a result, in Jin’s estimate the net profit of banks would expand by 4.2 percentage point in 2009. Quite simultaneously, the reduced reserve requirement would free more than RMB 640 billion Yuan (US$91.4 billion) into the system.[xx] In the estimation of Wu Yongyang, another Securities Analyst, the move of the PBOC to cut interest rate and reserve ratio would free nearly RMB 710 billion Yuan (US$ 103.9 billion) into the system. He said the impact would be positive for big banks like the Industrial and Commercial Bank of China and China Construction Bank, but surely negative for small and medium sized banks. She Minhua, a CITIC Jiantou Security Analyst, said, the latest act of the PBOC has had largely eliminated the rationale for further reductions, and as a result, listed banks were likely to see their profits wiped out or might experience a loss in 2009.

Notwithstanding, the Monetary Policy Committee, the key decision making body at the PBPC, said, in its latest meeting on April 12, 2009, that China would maintain a “moderately loose” monetary policy amid the worsening global crisis. The statement said it was essential for “continuity and stability of policy making”.[xxi] PBOC statement later said: “The central bank will continue to ensure ample liquidity in the banking system and reasonably increase loans to fund the economy.”

Zhou Xiaochuan, the Governor of PBOC and the Chinese Premier Wen Jiabao had earlier dropped a broad hint to this effect in the course of 11th press briefing at the concluding day of the 10-day session of the Second Session of the 11th National people’s Congress (NPC) in March 2009. The two had favoured moderately easy monetary policy for 2009 with perceived objectives of boosting “fast but steady economic growth by expanding domestic demand”.[xxii] The Chinese Premier had then called 2009 a most difficult year ahead and wanted the tight monetary policy in vogue to be “relaxed to prevent an economic down slide.

The rationale is not hard to imagine. In the first half of 2008, over 67000 SMEs, each with sales income exceeding 5 million Yuan (US$ 0.7 million), were closed down. It rendered 20 million workforce unemployed. The figure did not include service industry and SMEs whose sales were less than 5 million Yuan.[xxiii]

The Chinese banking system responded quite fast. New loans in the first quarter of 2009 touched RMB 4.58 trillion Yuan (US$ 670 billion). At the present pace, new loans, averaging just RMB 500 billion Yuan (US $ 72.3 billion) per month for the rest three quarters of 2009 stand to take bank lending to over RMB 9 trillion (US$ 1.32 trillion).

While lucrative, the overdose of medicine held the spectre of incalculable side effects. Growth in M2, the broadest measure of money supply, hit a record 25.5 per cent in March 2009.[xxiv] It pushed up consumer price index (CPI); eroded real wages; and, put the lives of people in jeopardy, in particular the multitude of laid off and migrant workers who suffered the brunt of loss of their urban jobs. Worse still, where CPI and producer price index (PPI) has shown signs of declines, it is but deflationary in nature and effects.[xxv] China Banking Regulatory Commission and wide section of Chinese think-tank feared “rise of non-performing assets”, encouragement to “fraudulent activities” including “fake mortgages”, and last but not the least, “seepage of money into stock markets”. [xxvi]

Notwithstanding, the recent performance of the industrial sector do as well provide grounds for concern over this rapid credit growth. A National Statistics Bureau survey of 22 regions found industrial profits totaled only 323 billion Yuan (US$ 47.29 billion) during the first quarter, down 32 percent from a year earlier. That means annual profits for all industries will amount to only about 1.6 trillion Yuan (US$ 234.2 billion) this year. Outstanding loans currently stand at 35 trillion Yuan (US$ 5.12 trillion) . Assuming companies have kept a moderate debt ratio averaging less than 50 per cent, their capital investments now exceed 35 trillion Yuan (US$ 5.12 trillion). And profits of 1.6 trillion Yuan (US$ 234.2 trillion) versus 35 trillion Yuan (US$ 5.12 trillion) in capital investment means an annual return rate of only 4.57 percent, below the weighted loan interest rate of 4.76 percent we saw in March 09. In this sense, the Chinese companies seem to be in a rather weak position to finance debt with earnings. [xxvii]

Not surprising, Ba Shusong, an economist with Development Research Center and quite a few others have warned the government against the hazard of pushing the panic button too hard. “Monetary policy”, Ba told Economic Information Daily “should revert from being easy to avoid steep ups and downs in credit expansion, which could otherwise affect the economy, and put pressure on the operation of the banks in future. PBOC, too, has taken cognizance of the problem. It called upon major Chinese banks to lend at a steadier, more rational pace.

Fiscal Policy Instruments and their Domestic Demand Raising Potentials

In line with the easy monetary policy as such, the PRC has gone for expansionary fiscal policy. [xxviii] Conceptually, save to the extent of “crowding out” effects, it sounds well. [xxix] It is deemed that the measure would stem out flaccid and/ or dormant aggregate demand, and usher economic objectives of price stability, full employment and economic growth. The crowding out effect, borne of interest push across the market, was again quite manageable affair.

Sundry elements apart, RMB 4 trillion Yuan (US$585.5 billion) stimulus package, announced on Nov 09, 2008, hitherto constituted China’s enviable flag fiscal instrument to spur domestic demand.[xxx] The decision came about two months after the global financial crisis deepened in Sep 2008. It was aimed at creating domestic demand, both in lieu for the down slides in external demand and outright new. However, not until recently, it remained shrouded in controversy on many counts, primarily, the new components. The mystery was not resolved until the Chinese Premier Wen Jiabao gave final clearance to the debate four months later.[xxxi] “Completely new” element in the RMB 4 trillion Yuan (US$585.5 billion) stimulus package, as the Chinese Premier added, constituted of RMB 1.18 trillion Yuan (US$ 172.76 billion), funded by the central government. The rest RMB 2.82 trillion Yuan (US$ 412.74) were part of already committed investments.

The expenditure plan of the package has been then spread over to two years. While not spelled out in the first go, the best fit of availability of the central fund for 2009 and 2010 could estimably be RMB 590 billion Yuan (US$ 86.3 billion) each. It works out to just 3.68 per cent of China’s GDP of RMB 15.9878 trillion Yuan (US$ 2.34 trillion). It again works out 3.2 per cent of the estimated RMB 18 trillion investment plan. There are yet other components. It included RMB 600 billion Yuan (US$ 87.8 billion) tax cuts and RMB 850 billion Yuan three year investment in health care reform besides proposed increase in the emoluments of 12 million teachers. The Chinese Premier has, of course, hinted for some more steps in the direction.[xxxii]

Breakdown of the expenditure, unveiled by China’s top planning body, the National Development and Reforms Commission (NDRC) in early MARCH 2009, suggested typical Chinese characteristics of making virtue of its otherwise utter necessity to socio-economic survival. Rehabilitation works in May 12, 2008 earthquake hit Wenchuan and other areas in Sichuan province must not have waited any further. It has claimed the bulk of 25 per cent (RMB 1000 billion Yuan) of the total stimulus plan. Public infrastructure, involving as much as 38 per cent (1500 billion Yuan) of the total resource bear out rather repackaging manoeuvres of the committed planned expenditures. The stated plan to spend RMB 370 billion Yuan on technology advancement is perhaps the long awaited need. Obsolete high energy consuming industrial structure is the bane of the Chinese industrial structure.

Social welfare and rural development, constituting respectively RMB 4oo billion Yuan and RMB 370 billion Yuan, stand scrutiny to China’s efforts to address the dislocations in the life system of vast multitude of rural populace including 120 million migrant workers, forced to return to their villages in interior Chinese provinces. Projects related to so called sustainable development, in particular those catering environmental protection would cost RMB 210 billion Yuan while education and culture related projects would invite expenditure of 150 billion Yuan. Given the nature of populace, getting due purchasing power, the demand, largely for the wage goods among consumer goods were slated to get major shot in the arms. Theoretically, save the extent of induced consumer expenditure, it held potentials of adding up, and may be even spurring demands for goods and services in existing traditional segments. It carried again little prospect to be a substitute for sagging external demands.

Composition of the stimulus package 8-9 months later now is much different than what it was originally conceived and planned out. The stimulus package was supposed to be divided between investment to help companies and social welfare to help stimulate demand. The central government had pledged RMB 1.18 trillion Yuan (us$ 172.6 billion), which accounted for 29.5 per cent of the total RMB 4 trillion Yuan stimulus package. The rest was supposed to come from local governments and lending by state owned banks. The central government has lived by its commitment. The banks share made up of lending went into overdrive and the local governments only put up about half. RMB 200 billion Yuan (US$29.3 billion) local government bond sale, approved by the Chinese Ministry of Finance (MoF), constituted part of China’s RMB 950 billion Yuan (US$139.09 billion) book entry treasury bond sale plan. [xxxiii] The National Development and Reform Commission (NDRC) as well as central State Owned Enterprises have been issuing corporate bonds.

Actualization Process and the Simmers

Aware of the enormity of the problem in easy reset and recovery of the economy, the Chinese political and professional leaderships have been constantly revising and reorienting strategic and tactical moves. The malaise, inter alia, owes its genesis to drastic fall in the exports. The glut has created imponderable situation. As many as 3.18 million small and medium size enterprises had closed or suspended their operation by Dec 2008, and rendered 40 million workforces jobless. There are host of others, including Chinese logistics to have suffered indirect brunt. Peng Xingyun, Director, Monetary Policy Decision, Chinese Academy of Social Sciences, Beijing recently expressed his concern about large scale bankruptcies among small and medium size companies in coastal provinces. The Chinese strategy in vogue strives to access new markets while reviving and consolidating old ones. Chinese leadership and trade delegation have been visiting various destinations and clinching every possible deal. As the global economy is slated to contract by 2.9 per cent 2009 and could hardly grow more than 2 per cent in 2010, the Chinese exports may not experience reckonable turn around.

Spur in bank lending in the last six months of 2009 in response to RMB 4 trillion Yuan (US$ 585.5 billion) stimulus package and other investments plans, in particular RMB 800 billion Yuan (US$117 billion) health care network programme is being eulogized as well thought short run palliative to neutralize the negative impacts of down slides in exports!

In the first quarter of 2009, the Chinese state-owned Industrial & Commercial Bank of China Ltd., China Construction Bank Corporation and Bank of China lent 4.58 trillion Yuan (US$670.5 billion). This cash surge accounted for total bank lending in 2008.[xxxiv] An article, captioned ““China's Loan Binge: Stimulus or Insanity?” (Caijing, May 6, 2009), says that the Industrial & Commercial Bank of China Ltd., Bank of Agriculture and Bank of China actually accelerated the pace of new loans as the quarter drew to a close. Wen Chunling, a Beijing-based analyst at Fitch Ratings (Bloomberg, April 30, 2009), suspects that the banks in question have since compromised their risk management principles under the pressure of the government, and there was every chance for such loans turning non-performing in the next few years. [xxxv] Fearing the bubbles, the Chairman of China Banking Regulatory Commission (CBRC) Chairman Liu Mingkang called upon banks to moderate their loaning pace in April 2009.

In announcing the stimulus package of RMB 4 trillion Yuan, the Chinese State Council stipulated that all the funds would be allocated for the 10 priority projects by the end of 2010. After spending 100 billion Yuan in Q4 ’08 and 130 billion Yuan in Q1 ’09, there are only 7 quarters left before the deadline to spend 94.25% of the stimulus package. Whether or not the Chinese government will adhere to the plan’s deadline remains to be seen, however, it is clear spending is going to drastically ramp up over the next few quarters.

Points apart, the Chinese leadership and professionals pinned their hopes in early reset and recovery of the Chinese economy on specific premise of raising domestic consumption on the strength of new monetary and fiscal policy instruments as such in vogue. Besides adding liquidity to the system, the measures sought to spur marginal propensity to consume over marginal propensity to save.

In its stride, the Chinese State Council announced a spate of measures to jack up domestic consumption, which, inter alia, included raising pension and minimum allowance for low income people. The local governments, at their levels, went ahead with issuing concession vouchers during festive occasions. Property buying has been made a lot easier. A recent offering calls for investors to come up with 30 per cent down payment to receive a 4 per cent loan for the remaining 70 per cent. The 3 per cent deed tax and 0.05 per cent stamp duty is now historically very low. The capital gains tax has been reduced to 5 per cent of the gain versus what had been 5 per cent of the entire amount. Simultaneously, China halved the purchase tax on passenger cars to 5 per cent for models with engine displacements of less than 1.6 liters.

NBS data, released on May 20, 2009, showed that China’s retail sales rose 14.8 per cent in April year on year. It was 0.1 percentage points higher than in March. Rural spending, driven by a Government rebate policy on home-appliance purchases and other commodities, grew by 16.7 per cent in April, which was 2.8 percentage points higher than urban growth. Property sales rose by 17.5 per cent in acreage from a year earlier in the first four months of 2009. Nevertheless, private sector housing sales rose 8.6 per cent year on year in 70 mid-sized and large cities in the first quarter, including Beijing, Shanghai and Guangdong and other metropolises. 2.67 million Vehicles were sold in the first quarter, up 3.88 per cent year on year. In April 2009, more than 1.5 million vehicles were sold. In the first quarter of 2009 as whole, the vehicle sales went up 11.1 per cent. Zhuang Jian, a senior economist with the Asian Development Bank, put a caveat for future sustainability of momentum in sales growth, in particular property and cars until the Chinese government undertook new measures to kindle consumer confidence. “It is difficult for automobile sales to maintain their current momentum, unless new favourable credit policies are released on the purchasing side,” said Wu Tujin, an analyst with Great Wall Securities Co Ltd.[xxxvi]

It could be a silver lining. Once domestic demand for goods and services moves up, and in particular if it was capable of offsetting the fall in aggregate demand due to fall in external demand, the Chinese economy stood every chance of crossing the threshold for reset and recovery. Accompanying tell tale on-ground developments included unbound resumption of market forces, and rekindling of whole range of economic activities. The NBS report stated that China’s industrial output rose 7.3 per cent and 8.9 per cent year on year in April and May 2009 respectively. Hao Daming, a Beijing based economist with Galaxy Securities attributed the phenomenon to “rapid improvements in domestic demand”.[xxxvii] This can otherwise be true as there is little rationale for production activities to pick up in the face continuous spell of declines in exports and imports. [xxxviii] However, the fact is otherwise. The growth as such is investment driven, and could add up the glut as the domestic market is still far less geared to absorb and the prospect for exports stand bleak until the major Chinese export destinations in US, EU and such other economies post net demand for Chinese goods and services. [xxxix] Notwithstanding, a certain section of economists in the world doubt the figure as the Chinese industrial output growth figure is not matched with energy generation and consumption figures. [xl]

Record production is then seldom expected to be met with record consumption. According to World Steel Association, the demand for steel in China shall fall by 5 per cent in 2009. So could be the case of products other set of basic industries. Eventually even state owned industries can not keep on producing unsold products. In the case of SMEs, a large proportion of target consumers are in the process of de-leveraging, and actually saving. They would not be in buying spree of SME products.

The Chinese monetary and fiscal policy instruments to reset and recovery thus have a bleak future.

(Dr. Sheonandan Pandey is a China watcher with a long stint in the Government of India and finally retied from National Technical Research Organization. He can be contacted at sheonandan@hotmail.com)


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[i] China got into pep talks mode right when the Chinese President Hu Jintao attended Nov 2008 G-20 Washington summit and visited Costa Rica, Cuba, Peru and Greece. He sought to assure that the Chinese economy had potentials to recover back much early than expected and China would play quintessential role in the recovery of the world economy. Chinese Premier Wen Jiabao, Chinese Foreign Minister Yang Jiechi and the Governor of China’s Central Bank, the People’s Bank of China (PBOC)Zhou Xiaochuan feverishly spoke about China’s potential to lift the world economy and not just the Chinese economy from its down hill journey, caused by global financial crisis and global economic down turn.

[ii]In its quarterly updates, released on June 18, 2009, the WB joined Goldman Sach’s Group Inc, Morgan Stanley and UBS AG in raising growth forecasts for China for 2009 to 7.2 per cent after its RMB 4 trillion Yuan (US$ 585.5 billion) stimulus package, announced in Nov 2008, triggered record loans and surging investments. In March 2009, the WB had scaled down its projection to 6.5 per cent from its earlier projections of 7.5 per cent in Nov 2008, and 9.2 per cent still earlier. In the first three quarters, China’s economic growth had plummeted to 9.9 per cent after five years of double digit growth, the top most being 13 per cent in 2007. China insists on its potential to realize 8 per cent growth, which is the minimum to retain China’s employment level at its place.

[iii] Recovery connotes a bounce back to the previous peak of growth while reset implies a positive turn.

[iv] China’s GDP stood at RMB 6574.5 billion Yuan (US$ 939 billion) during the first quarter of 2009, where the primary, secondary and tertiary sectors contributed respectively RMB 470.0 billion Yuan (), RMB 3196.8 Yuan and RMB 2907.7 billion Yuan (). The three sectors respectively recorded growth rate of 3.5 per cent, 5.3 per cent and 7.4 per cent.

[v] In his paper, published in China Security Journal, and quoted in China Daily in its issue dated 22 April 2009, Fan said: “Possibility for China to have steady and quick recovery is not big due to the current external economic situation and structural problems with the domestic economy. The impact of global crisis is spreading and exerting greater and deeper effects on China. Fan added further: “China still suffered from excess capacity in some undertakings, meaning that some obsolete products capacity should start to be phased out beginning this very quarter. The process could take several years before a logical readjustment could complete”. http://www.chinadaily.com.cn/bizchina/2009-04/22/content_7704145.htm

[vi] Lack of clarity about the total quantum of the stimulus package continues even as the top Chinese leadership, the Chinese Premier Wen Jiabao included, quite often sought to explain away the doubts. RMB 4 trillion Yuan (US$585.6 billion) package, announced in Nov 2008, has, at best, RMB 1.18 trillion Yuan (US $172.7 billion as the central government component and the rest RMB 2.82 trillion Yuan (US $ 412.9 billion) as local government component. Responding to the doubts about the resource at hand and their viability, the Chinese Premier told media on the concluding day of the second annual session of the 11th National People’s congress that the proposed RMB 4 trillion Yuan stimulus package excluded other projects, including the RMB 600 billion Yuan US$ 87.84 billion) tax cuts, old-age pension increase for those who had retired from the enterprises and hitherto lived on quite paltry sum, salary increase to 12 million teachers, subsidies to farmers as well as an RMB 850 billion (US$ 124.45 billion) expenditure in health care. All this amount was then not available for 2009. RMB 4 trillion Yuan was a two year package while other expenditures including those on health care were meant for subsequent three years period.

[vii] China displaced Germany with marginal increase in GDP in 2008. Interestingly, there is wide gap in comparison with the top first, the US and top second, Japan. The two respectively hold 28.76 and 09.11 per cent shares in the global economy. Notwithstanding, Germany, France, UK and the rest others in the European Union suffering the bout of recession jointly hold 30.49 per cent share in the global economy.

[viii] Monetary and fiscal policies refer to “demand management” techniques. Monetary policy is the process, where the monetary authority of a country controls (i) the supply of money, (ii) availability of money, and (iii) cost of money. It can be expansionary to combat recession or contractionary to address heating of the economy. The economic policy is often referred as accommodative, neutral of tight depending on interest being to add to growth, remain ambivalent or poised to curb inflation. The tool of monetary policies include: increasing interest rates by fiat; reducing the monetary base; and, increasing reserve requirements. Fiscal policy relate to direct intervention of the authority, where the tools available at the disposal of the government included change in the level of government expenditure or taxation. The two can be used independently or in conjunction with each others, depending on the ideology of the authority.

[ix] Barbera, Robert J., The Cost of Capitalism: Understanding Market Mayhem and Stabilizing our Economic Future, March 2009,

[x] http://news.xinhuanet.com/english/2008-01/24/content_7485388.htm

[xi] “ Credit Crisis- How it Began” In Guardian, Aug 5, 2008. http://www.guardian.co.uk/business/2008/aug/05/northernrock.banking

[xii] The classic definition of a recession is two consecutive quarters of negative gross domestic product (GDP). The Business Cycle Dating Committee of the National Bureau of Economic Research (NBER), the US panel recognized as the official arbiter of business cycles, adjudicated onset of recession in the USA right since early December 2007. The NBER, however, did not identify economic activity solely with real GDP growth but used a range of indicators, such as employment, personal income and industrial output, in determining the onset of recession.

[xiii] http://www.financialexpress.com/news/china-predicts-stable-export-growth-in-2008/283591

[xiv] Xinhua News Agency, January 22, 2009.

[xv] In April 2009, China’s exports fell 22.6 per cent from a year earlier in the 6th straight monthly decline. Total Chinese exports in the month ran to US$ 91.94 billion. It was sharper than March 2009 decline of 17. 1 per cent and the median forecasts of 18.4 per cent in Dow Jones Newswire survey of 16 economists. In January 2009 and February 2009, the Chinese exports fell by 17.5 per cent and 25.1 per cent respectively on year on year basis.

[xvi] PBOC plays pivotal role in monetary policy formulation and implementation after assuming the charge of central bank in 1984. For quite long, it resorted to direct administrative methods to balance the aggregates. After abolition of credit ceiling in Jan 1998 and, the expansion of open market operations, it has come to depend on indirect methods.

[xvii] The global financial crisis of 2008-2009 raised its head right in July 2007 when the loss of confidence of investors in the value of securitized mortgage in the US resulted in liquidity crisis. In Sep 2008, the crisis deepened, as stock markets world wide crashed and entered a period of high volatility, and a considerable number of banks, mortgage lenders, and insurance companies got into failure spree.

[xviii] The impact of the cuts in the interest rates in improving the liquidity situation in automatic natural process remains constricted as the lending and deposit rates for commercial banks is set by the Chinese Ministry of Finance in tandem with policy decision of the government and party. The market mechanism have little role. This limits the pass through of changes in the PBOC interest rates.

[xix] China had ratcheted up the reserve ratio, from 6 per cent in Aug 2003 TO 14.5 per cent in Dec. 2007 and 17.5 per cent in June 2008. The 1 percentage point cut in the reserve ratio brought to bear upon for the first time in Sep 2008 did not apply for the five large banks e.g. the Industrial and Commercial Bank of China, the Agricultural Bank of China, The Bank of China, the China Construction Bank, and the Banks of Communications. It did not apply for the Postal Savings Banks as well.

[xx] http://en.chinagate.cn/top.news/2008-12/07/content_16910501_2.htm

[xxi] http://www.thearynews.com/english/newsdatail.asp?nid=25003

[xxii] Xinhua, March 06, 2009.

[xxiii] http://en.cc.cn/business/enterprse/200812/06/t20081206_17599073.shtml

[xxiv] M2, a measure of money supply that includes M1, plus savings and small time deposits, overnight repos at commercial banks, and non-institutional money market accounts.

[xxv] NBS data released on May 10, 2009 shoed that CPI in China fell by 0.9 per cent year-on-year in the first five months of 2009. In May 2009, it declined by 1.4 per cent. It was nearly constant in comparison to April 2009 when it had dropped by 1.5 per cent. 32 per cent drop in pork price due to governmental initiative for various non-economic reasons contributed in the drop of prices of food items by 0.6 per cent. The prices of non-food items dropped by 1.7 per cent. It was mainly due to fall in the effective demand in the face of scary recession. Producer Price Index (PPI) in May fell by staggering 7.7 per cent year-on year. For the first quarter, the decline in PPI worked out to be 4.6 percent. In the preceding April 2009, it accounted for 6.6 per cent. http://www.chinaeconomicreview.com.cn/dailybriefing/2009_06_10/CPI_PPIfall_in_May.html.

[xxvi] Estimates about non-performing loans (NPL) in China vary. At least 2 per cent of the loans made since 2007 have been reported as non-performing. The proportion was as high as 60 percent for older lending. China had so far RMB 35 trillion Yuan outstanding bank loans. With the present doze of RMB 9 trillion Yuan loan in the market, the total would run to RMB 44 trillion Yuan. Experts put the figure to range between 20-40 per cent. Ernst and Young had put the figure at US$ 900 billion as of May 2008, which it later retracted. Fitch Ratings put the figures at US$470 billion.

[xxvii] Lu Lei, No End in Sight for Loose Monetary Policy, Caijing, http://english.caijing.com.cn/2009-06-04/1101

[xxviii] Expansionary stance of fiscal policy involves a net increase in government spending (G>T). The other two stances are neutral and contractionary. A neutral stance of fiscal policy implies a balanced budget (G=T) while a contractionary stance stands for surplus budget (G
[xxix] Crowding out stand for a situation when the government borrowing pushed demand for credit, and the interest rates across the market jump to a limit when aggregate demand slides down in its totality.

[xxx] RMB 850 billion Yuan expenditure on building health infrastructure, proposal to give reckonable raise in the salary of teachers, etc constitute the sundry elements in the stimulus package.

[xxxi] As the analysts world over doubted the credentials of the Chinese stimulus package, the exasperated Chinese Premier Wen went on record to say on Mar 13, 2009 that RMB 1.18 trillion Yuan in the package was “completely new” investment, slated to be spent on projects concerning people’s well being, technology upgrading, environmental protection, and major infrastructure projects. Wen admitted publicly that some projects in the stimulus package, such as roads and railways, were factually already included in China’s 11th five year development plan.

[xxxii] http://english.people.com.cn/90001/90776/90885/6613552.htm

[xxxiii] Of RMB 200 billion Yuan bond, allocated by the MoF to the local governments, Sichuan, the May 12, 2008 earthquake hit province, was to get RMB 18 billion, Guangdong RMB 11 billion Yuan, Yunnan RMB 8.4 billion Yuan, Liaoning RMB 6.6 billion Yuan, Guangxi RMB 6.5 billion Yuan, Guizhou RMB 6.4 billion Yuan, Shaanxi RMB 6.0 billion Yuan, Hebei RMB 6.0 billion Yuan, Anhui RMB 4 billion Yuan, Ningxia RMB 3 billion Yuan, Xinjiang RMB 3 billion Yuan and Beijing, the capital RMB 5.6 billion Yuan. The allocation of bonds for the por other region awaited decision.

[xxxiv] Industrial & Commercial Bank of China Ltd. advanced 636.4 billion Yuan (US$93.3 billion) of new loans, almost quadruple the amount extended in the same period a year ago and more than the bank’s total lending in 2008. China Construction Bank Corporation offered 521 billion Yuan of new credit in the first three months, compared with 161 billion Yuan a year earlier. Bank of China made 511 billion Yuan of new loans, more than twice the amount a year earlier. All three banks are state-owned and based in Beijing.

[xxxv] The size of China’s bad loan has been a source of constant controversy. Gordon Chang, a China expert and author of "The Coming Collapse of China," told the hearing of the US-China Economic and Security Review Commission that China's banks and instrumentalities were probably sitting on a trillion dollars of doubtful loans. He warned that "a bank failure in the next few years is possible, if not likely" and that China's banks, "almost without exception, are hopelessly insolvent from a balance sheet point of view.” Chinese banks are blowing up their balance sheets at unprecedented rates," he said, adding that banking failure would "almost certainly lead to a collapse of the economy" and cause the political system to be even more fragile. Chang also said that China was burdened by too much debt. Beijing claims that China's debt to gross domestic product (GDP) ratio is only 18 percent but Chang said it was a staggering 81 percent, based on his "conservative" calculations.

[xxxvi] Xinhua, May 14, 2009.

[xxxvii] http://www.thestandard.com.hk/breaking_news_detail.asp?id=15012

[xxxviii] Chinese exports and imports in fell 26.4 per cent and 25.2 per cent in year on year in May 2009. The fall is consecutive in a row for the last seven months, and at an accelerated pace from April 2009. Notwithstanding, May 2009 trade surplus of US$ 13.4 billion was below forecasts of US$14.8 billion. Expected drop in exports and imports were 23.1 per cent and 22.0 per cent year on year.

[xxxix] Investment leaped 40 per cent in May 2009 on the back of government pump priming. As per the NBS data, investment in urban areas in fixed assets rose 32.9 per cent in the first 5 months from a year earlier, compared to 30.5 per cent in the first 4 months.

[xl] Statistics released by the Chinese State Grid Corporation of China shows that power generation in April 2009 fell 3.55 per cent from a year earlier, to 274.76 billion kilowatt hours. Since the Chinese industry consumes nearly 70 per cent of Chinese power, it is almost a riddle how drops in power generation and increase in industrial out put could logically go hand in hand. In fact, electricity consumption in all other sectors, say agriculture, tertiary industry, and residential use have had significant rise during the first quarter of 2009. The agriculture, tertiary and household sectors registered respectively increase of 5.12 per cent, 7.41 per cent and 9.88 percent. Drop in energy consumption secondary industry started much before the Chinese government announced stimulus package of RMB 4 trillion Yuan. It started falling with the fall in export orders, in particular in Guangdong, Zhejiang, Shenzhen and other such export bases in China.

Karabakh: Uneasy Limbo

The status quo in Nagorno-Karabakh lingers, despite international involvement, and the self-declared republic’s foreign minister talks to ISN’s Karl Rahder about the situation on the ground.

Stepanakert, the capital of the self-declared country of Nagorno-Karabakh, is a pleasant, small city of about 50,000 people. Like Armenians everywhere, the residents of Stepanakert love to walk in the evening. They stroll in twos or threes or with their families along the sidewalks or in front of the president’s office - checking each other out, flirting, catching up on the news. Quiet cafes are arranged along the sidewalks, where you can get a pizza or a beer and chat with friends. In short, Stepanakert hardly feels like the fulcrum of an ongoing international dispute that could erupt into a regional war.

After its victory in the brutal 1992-1994 conflict between Azerbaijan and Armenia that left some 30,000 dead and hundreds of thousands of refugees, the Nagorno-Karabakh Republic (NKR) is still recognized by no one, not even its protector Armenia. The US has repeatedly said that it respects Azerbaijan’s territorial integrity, and the UN Security Council passed several resolutions during the war also reaffirming Azerbaijan’s territorial integrity and calling for the withdrawal of forces from 'occupied territories.'

But the uneasy status quo lingers, despite the involvement of the Organization for Security and Cooperation in Europe’s (OSCE) Minsk Group in sponsoring negotiations between Armenia and Azerbaijan. The pattern that has emerged over the years is that the Minsk Group co-chair nations – France, Russia and the US – announce that 'significant progress' has been made or that the two sides are close to an agreement. Nothing changes, however: Karabakh remains in limbo, and Azerbaijan continues to spend huge sums re-arming. Azerbaijani President Ilham Aliyev repeatedly warns that he will not hesitate to attack if negotiations prove fruitless. In early June, Aliyev met Armenian President Serzh Sarkisian in St Petersburg for the latest in a series of talks on the Karabakh issue.

The one significant player that has not been allowed to participate in the negotiations is the NKR, seen by the Azerbaijani side as a breakaway province, hence having no legitimacy and deserving no voice in the discussions. Its interests are represented by the Armenian government, a situation that the Karabakhi Armenians find increasingly frustrating.

On 14 May in Stepanakert, I sat down with Georgi Petrosyan, the NKR’s foreign minister, to talk about a host of issues including Karabakh’s final status, the OSCE Minsk Group’s usefulness, Armenian-Turkish relations and the prospects of another war.

Petrosyan was often funny and remarkably candid – not the usual portrait of a diplomat, which, he reminded me, he is not. By training, Petrosyan is an electrical engineer, but has served in a variety of positions in the NKR government, and has, since late 2005, been their foreign minister.

War prospects
The question of a new war looms as the Azerbaijani side has wearied of the negotiating process, and I asked Petrosyan how worried he was about the prospect of renewed conflict.

“Rather worried...,” he said. “In the situation whereby we hear on a daily basis [from Azerbaijan] that ‘We are getting stronger, we will attack,’ we are subjected to this. These are the words of the Azerbaijani president, that ‘we will use our forces to liberate.’ That’s what I hear.”

I pointed out that the rhetoric from President Aliyev had become more warlike as Azerbaijan’s defense budget has risen dramatically in recent years.

“How many times do you think Azerbaijan should increase its military budget for me to say that a war will start?” Petrosyan asked. “Ten times? Fifty times? For a war to probably begin? What I hear coming from Azerbaijan is that if a rape is inevitable, then relax and enjoy it! That is what they are trying to say. So they have become stronger! So what? What’s next? I’m not ready to be raped."

Many analysts have speculated that the sharp spike in Azerbaijan’s defense budget is intended as a bargaining chip to force concessions out of Armenia at the negotiating table. This, perhaps, is more likely than preparing for war, but perhaps not. According to Petrosyan, anything is possible.

“We are looking at it from all possible points of view, from the political and diplomatic level, whereby they can use it as a bargaining chip, but also in real terms, from the military component as well. We have to be ready to face it. And we try to take the necessary measures to be ready to withstand these things in real life, in reality. When the time comes.”

There also are legitimate fears that a new conflict between Karabakh and Azerbaijan could grow into a larger, regional war involving other powers such as Russia or even Iran. But on this subject, the NK foreign minister was quiet.

“I cannot talk for other states, I can tell you what we will do. I cannot tell you what others will do. If they attack, we will defend ourselves with all possible means,” he said.

Using an analogy to describe the choices one has when being pursued by a gang of bullies, Petrosyan said: “When you see that several guys are coming at you when you are alone, there are three ways to deal with it: to silently be beaten up, without complaining; to flee or to try to win the fight …”

“When you realize that you have no place to run and no desire to be raped, then you turn to the third option. You try to win, especially since we already had that experience once. We were beaten up, we beat them up as well, but we gained some very serious experience. If they want to try it again, then what can we do? Let them try it.”

But as will become clear in subsequent installments of our long conversation, Petrosyan is not obsessed with the possibility of war. We talked much more about Karabakh’s current status, the negotiation process, and 'psychological issues,' as he put it. He was also concerned about the attitude in Azerbaijan toward Armenians and Karabakh, and had something to say about how attitudes are spawned and how they can change:

“These are emotional issues in Azerbaijan. We could sow the seeds of hatred, too. Those who sow the seeds of animosity are the weak ones. Because if I bring up my son in hatred, I spoil his future. But if I bring him up in courage, he can become a good man. We do not want to spread animosity among our youth.”



Karl Rahder is a senior correspondent for ISN Security Watch in the South Caucasus.

The views and opinions expressed herein are those of the author only, not the International Relations and Security Network (ISN).