📰 House panel quizzes govt. on foreign policy
•“India has always been there for the Maldives and will continue our commitment to be the ‘first’ friend,” said the MEA, which also acknowledged that the 2015 visit to the Maldives by Prime Minister Narendra Modi “was cancelled at the last minute due to political developments in the Maldives.”
•India’s ties with the Maldives has turned cold since the first week of December when Male signed a Free Trade Agreement with China after rushing it through Parliament. However, President Abdulla Yameen Abdul Gayoom during the weekend tried to address India’s concerns and said India is Male’s “closest friend and ally” and both sides are also working on an FTA.
•People familiar with the meeting said a Rajya Sabha member also raised India-Nepal ties following the return of K.P. Sharma Oli as the newly elected leader of Nepal because Mr. Oli is known to be a critic of India’s policies.
•“For the first time, a party campaigned on a clearly anti-India platform and people have voted that party to power. Developments in Nepal remain a serious concern to us,” the MP said.
•The Committee also raised the issue of visas for Pakistani civil society activists who wish to travel to India. “Pakistan’s civil society and intellectuals have been staunchly democratic and great supporters of normalisation of India-Pakistan ties and therefore there is no ground to delay visas for them,” an MP said. The meeting also discussed the recent developments over the Doklam standoff with China and the ongoing negotiations with Pakistan over Kulbhushan Jadhav. The Ministry of External Affairs in its statement kept before the committee said India wishes to engage Pakistan on established principles but “there will be no compromise on matters pertaining to India’s national security and incidents of cross-border terrorism and infiltration will be dealt with firmly.”
📰 Pact soon to build marine capacity
Faculty recruitment to be completed soon and courses offered
•The upcoming International Training Centre for Operational Oceanography (ITCOocean) at the Indian National Centre For Ocean Information Services (INCOIS) here is all set to sign up with UNESCO to cater to the worldwide need to build technical and management manpower capacity in marine, coastal sustainability and response to marine natural hazards.
•To be recognised as Category 2 Centre (C2C) of UNESCO, the Rs. 100-crore institute in Pragatinagar (Kukatpally) will be in a position to contribute to the United Nations body’s Sustainable Development Goal-14 (SDG 14).
•The Union Cabinet chaired by Prime Minister Narendra Modi recently approved the signing of this agreement.
•India had offered to set up the ITCOocean for the benefit of countries around the Indian Ocean rim (26 from Asia and Africa) after an Intergovernmental Oceanographic Commission (IOC) of 150-odd member countries decided to go for developing capacity building following the tsunami of 2004.
•“We are exploring the options with our UN permanent mission for UNESCO Director-General to come here and sign the agreement or one of our representatives will go there.
•“Either way, it will be done before March, and by June, the entire infrastructure will be ready for offering long-term courses for students and trainees,” according to INCOIS Director S.S.C. Shenoi.
•Operational oceanography involves systematic ocean studies and providing information services to the blue economy like fishing, disaster management, shipping and ports, coastal management, environmental management, offshore industries and also for the Indian Navy and Coast Guard.
•“We need expertise to interpret large data generated through research vessels on the ocean and our observation posts in studying marine resources, monsoons and about climate change. ITCOocean aims to bridge that gap,” adds B. Muralidhar Rao, Consultant, INCOIS.
•While the housing labs, classrooms and hostels are to be ready in six months, ITCOocean, utilising INCOIS faculty and infrastructure, has trained over 681 scientists, including 576 from India and 105 from 34 other countries, in various aspects of operational oceanography in the last couple of years.
•Soon, faculty recruitment is to be completed and plans are afoot to offer diplomas, post-graduate courses and research.
Collaboration
•ITCOocean has also tied up with Norway’s Nansen Scientific Society and the Research Council to collaborate in teaching and research.
•Indian Ocean Global Observing System (IOGOOS) and International Oceanographic Data and Information Exchange (IODE), besides tsunami warning, are to be scaled up by the Centre.
📰 This year, on Jerusalem
India’s vote at the UN is in line with its leading power ambitions, and not just a legacy of nonalignment
•When India voted on a UN General Assembly (UNGA) resolution last week on the status of Jerusalem, going against the wishes of the U.S. and Israel, many observers of its foreign policy were surprised. The resolution did not make a direct reference to the recent U.S. decision to recognise Jerusalem as the capital of Israel and shift its embassy to the holy city from Tel Aviv. Through the resolution adopted with 128 in favour to nine against, with 35 abstentions, the 193-member UNGA expressed “deep regret” over “recent decisions concerning the status of Jerusalem” and stressed that Jerusalem “is a final status issue to be resolved through negotiations in line with relevant U.N. resolutions,” between Israel and Palestine.
India’s stand
•The surprise over the Indian vote was not because it fell out of line with the country’s foreign policy as we have known it, but because of an apparent deviation from Prime Minister Narendra Modi’s new strategic thinking. Much has been written on the ‘Modi strategic doctrine’ but the concept has been pithily summarised by Mr. Modi himself and explained by Foreign Secretary S. Jaishankar on earlier occasions — the goal is to transform India from being a ‘balancing power’ to a ‘leading power’ on the international stage. U.S. President Donald Trump’s National Security Strategy released recently offers support for this aspiration of India to emerge as a ‘leading power.’
•India’s Jerusalem vote can be interpreted as a continuing adherence to its traditional policy of nonalignment. But a more appropriate interpretation of the vote is possible within the framework of India’s leading power ambitions. To do that, we need to also see the vote in conjunction with two other votes in the recent past at the UN. The first was in June, when India supported a move by Mauritius to take its sovereignty claims over the British-controlled Chagos Archipelago in the Indian Ocean to the International Court of Justice (ICJ), against the wishes of the U.S.; the second was in November when India won a seat on the ICJ, in spite of active opposition from the U.S.
•On the Jerusalem vote in the UNGA, which is not binding, if India had voted against the resolution, it would have ended up in the company of seven countries that joined the U.S. and Israel. These are Guatemala, Honduras, the Marshall Islands, Micronesia, Nauru, Palau and Togo, the combined population of which roughly equals the population of Delhi. In the 2012 Gujarat Assembly election, Mr. Modi won more votes in the Maninagar constituency than the population of four of these countries. Not exactly the group that India might want to lead, as second deputy after America and Israel.
•The second option was abstaining, along with Antigua-Barbuda, Argentina, Australia, Bahamas, Benin, Canada, Cameroon, Croatia, Haiti, etc.
•Of these, Canada, which used to vote with the U.S. on Israel resolutions, moved away from the U.S. position this time. Canada and Mexico also face the threat of the dismantling of the North American Free Trade Agreement by the Trump administration. As for Australia, its interests in West Asia are hardly comparable to India’s. In any case, not taking a position on an issue is hardly worthy of an aspiring leader.
•Supporters of the ‘leading power’ doctrine often argue, rightly, that India must be more forthright and articulate in expressing its position on issues confronting the world. As it did, for instance, by speaking up on the Belt and Road Initiative. So, abstaining was not an attractive option for an aspiring leading power.
Many advantages
•Suboptimal as it might be as a choice, voting for the resolution put India in the company of the overwhelming majority of the world. It kept India in the company of Shanghai Cooperation Organisation (SCO) and BRICS (Brazil, Russia, India, China, South Africa), groupings that India continues to value under the Modi government. While BRICS and the SCO stayed together, the American-led NATO split on the issue, and even the Five Eyes countries of the English-speaking West — Australia, Canada, New Zealand, the U.K. and the U.S. — did not stay together on this vote. And India has far more significant interests in West Asian peace and stability than many of these countries.
•South Korea and Japan, treaty allies of the U.S. in the midst of a nuclear threat from North Korea, also voted for the resolution. Yes, India voted alongside Pakistan, but that happens quite often. Some critics of the Indian vote have said Islamic countries do not support India on Kashmir. In 2016, Pakistan raised Kashmir nine times at the U.N.; in 2017, seven times, a total of 16 times. There are 57 countries in the Organisation of Islamic Cooperation, and statistically, there were 912 chances for a statement against India on Kashmir over the last two years by an Islamic country. But it has not happened even once.
•While India under Mr. Modi’s brand of Hindutva nationalism is seeking leadership status on the global stage, the U.S. under Mr. Trump is undergoing a transition from being a hegemon to being a bully in its leadership role. The Jerusalem decision itself and the rhetoric that preceded the UNGA vote is a stark demonstration of this new U.S. posture. The disruptive streak in Mr. Trump opens new possibilities for India’s leading power ambitions, but that cannot be achieved by blindly following American diktats. The Chagos Archipelago vote in June and India’s ICJ contest in November bear out that fact.
•Mauritius wanted the UNGA to request the ICJ to issue an advisory opinion on its sovereignty claim over archipelago as it considers it as an unfinished agenda of decolonisation. The U.S. recognises U.K. sovereignty over the territory and they jointly operate the Diego Garcia military base there. India voted in support of the resolution, overcoming the fear of a bilateral dispute being taken to ICJ. “The process of decolonisation that started with our own independence, still remains unfinished seven decades later,” India’s Permanent Representative to the UN, Syed Akbaruddin, said in a statement on India’s vote. The resolution was passed with 94 countries voting in favour, 15 against and 65 abstaining.
•In November, the U.S. supported the U.K. in its contest against India for an ICJ seat, as did all other permanent members of the Security Council. India stood its ground and won the day as the UNGA overwhelmingly supported it, forcing other permanent members to limit their support to the U.K., which finally withdrew its candidate. It is not difficult to draw a link between the two votes.
•Leading power ambitions are not realised by declaring unquestioning allegiance to anyone. If you see Nehruvian thinking in this script, it must be read with the caveat that any resemblance is purely coincidental and not intended. If you are worried that this might make the U.S. unhappy towards India, be assured, not any more unhappy than it can be towards the U.K. that voted against it — after all, the U.S. had voted for it in the ICJ election against India. And the vote is only as much an appeasement of the increasingly marginalised Muslims of India, as Japan’s vote for the resolution can be an appeasement of its 100,000-strong Muslims. Three UNGA votes over six months are more about multilateral diplomacy coming of age. India can be great friends with the U.S. and Israel and still disagree with them on some issues.
📰 On the line: on India-China boundary talks
It is vital that India-China talks on the boundary question pick up speed
•The meeting between the Special Representatives of India and China — National Security Adviser Ajit Doval and State Councillor Yang Jiechi — on the boundary question on December 22, the 20th so far, was unique for a number of reasons. The talks came more than 20 months after the last round, reflecting a period of extreme strain in India-China ties, including the 70-day troop stand-off at Doklam this year. Previous meetings had followed each other within a year. Also, at the recent Communist Party Congress, Mr. Yang was elevated to the Political Bureau, and this is the first time the Chinese side has been represented by an SR of such seniority. As a result, the two sides were best poised to move ahead in the three-step process that was part of the Agreement on ‘Political Parameters and Guiding Principles for the Settlement of the India-China Boundary Question’ in 2005 — that is, defining the guidelines for the settlement of border disputes, formulating a framework agreement on the implementation of the guidelines, and completing border demarcation. The SRs were given an extended mandate after meetings between Prime Minister Narendra Modi and President Xi Jinping this year, and thus went well beyond the remit of discussing the resolution of boundary issues. Above all, they were guided by the Modi-Xi agreements of 2017, including the ‘Astana consensus’ that “differences must not be allowed to become disputes”, and the understanding at Xiamen that India-China relations “are a factor of stability” in an increasingly unstable world.
•It would be a mistake, however, to infer that with all these engagements the worst in bilateral ties is now behind the two countries. Since 2013, when the Border Defence Cooperation Agreement was signed, there has been a steady decline in relations in all spheres. The border has seen more transgressions, people-to-people ties have suffered amid mutual suspicion, and China’s forays in South Asia as well as India’s forays into South-East Asian sea lanes have increasingly become areas of contestation. In India, this is seen as the outcome of China’s ambition of geopolitical domination. In this vitiated atmosphere India views every move by China as a targeted assault — such as the Belt and Road Initiative with the economic corridor with Pakistan, the free trade agreement with the Maldives, and the blocking of India’s membership bid at the Nuclear Suppliers Group. In turn, Beijing sees the U.S.-India defence agreements, the Quadrilateral engagement with Japan, Australia and the U.S., and Indian opposition to the BRI quite the same way. The stand-off at Doklam was a hint of what may ensue at greater regularity unless greater attention is paid to resolving the differences for which the SR meetings process was set up in the first place.
📰 A glimmer of hope? – on transgender identity
Self-identification should be the basis for access to benefits and entitlements for transgender persons
•Will the long years of waiting to recognise the identity of transgender persons finally end in this winter session of Parliament with the passing of the Transgender Persons (Protection of Rights) Bill 2016?
•The community has laid stress on the point that for them, dignity, respect, and access to health care are non-negotiable basic rights. Self-identification should be the sole criterion for gender recognition legally without the need of any other psychological, medical, or “expert” intervention. Self-declared identity should also form the basis for access to social security benefits and entitlements. The community maintains that the basic principle of “nothing about us, without us” must be applied for all trans and hijra rights, health and welfare activities.
•The community has rejected the setting up of district screening committees to recognise transgender persons as they say they are not objects or people with a contagious disease who need to be medically screened. Their argument, and rightly so, is that a medical assessment violates their right to self-identification and gender autonomy which are protected under the right to life and personal liberty guaranteed by the Constitution. Many do not want to be labelled as transgender or third gender but instead recognised legally by their self-identified gender of “male” or “female”.
The Kochi Metro example
•Will the Bill have provisions to protect them from discrimination? The experience so far has been that many who struggle to access jobs are discriminated against, forcing them to drop out.
•For example, in May, when the Kochi Metro Rail Limited formally employed 23 transgender persons, eight of them dropped out after being unable to find suitable accommodation based on the monthly wages they drew (between ₹9,000 and ₹15,000). Many households were unwilling to let out their houses to them. They faced other forms of discrimination too.
•Therefore, an effective enforcement mechanism is vital for the adjudication of anti-discrimination claims brought forward by transgender persons.
•While in 2014, based on the Census, five million acknowledged their transgender status, activists say their number could be much higher. Over 66% of them live in the rural areas. The Census data also highlighted the low literacy level in the community, just 46% in comparison to the general population’s 74%. In fact there should be reservation to facilitate their admission to schools and appointment in public offices. In 2014, the Supreme Court in National Legal Services Authority v. Union of India pointed out that reservation is one of the time-tested ways of enabling historically disadvantaged populations to join the mainstream.
Stigma and discrimination
•But accessing even the rights they already have is not easy. For example, even in an enlightened city such as Mumbai, young transgender persons seeking admission to college approach the transgender group leader, normally a person with clout, who then meets the college principal and, in most cases, secures their admission. Thereafter, the transgender person has to be on “best behaviour” and not stand out as that could compromise the admission.
•Hopefully the Bill will provide protection to transgender persons from violence and stigma which is a major factor. Often they are denied passage in public spaces and harmed or injured.
•The hijra community, especially those who are a part of the ‘guru-chela’ structure in Hijra gharanas and practise the traditions of “mangti” and “badhai”, are often harassed, detained under begging prohibition laws, and forced into begging homes.
•In the case of transgender children, their families, unable to accept their status, subject them to domestic violence, which often compels these children to leave home.
•Though several transgender persons have made a mark in the beauty and fashion industry, joined the police force, the academic world and even the Indian Navy, there is need for a comprehensive survey on the socio-economic status of the community. Transgender welfare boards are needed in different States. Transgender persons should take part in the national Census to generate accurate data.
A grey area
•Transgender identity is not yet recognised in criminal law, whether as the third gender or as a self-identified male or female. There is also no clarity on the application of gender-specific laws to transgender persons. Section 377 of the Indian Penal Code is applicable to transgender persons (i.e., those who were male at birth). This amounts to double persecution.
•Finally, the community wants mental health counselling support and free gender transition surgery facilities in government hospitals. There are other issues that worry transgender persons such as their right to property, adoption, marriage, pension, and care for the old and the disabled. Some of these issues may be resolved when the Bill, taking note of their concerns, is passed. The Bill could be the first big step towards equality and their recognition in the mainstream.
📰 Centre moves SC against fixed term for police chiefs
Says States are appointing ‘favourites’
•The Union government has filed an interlocutory application in the Supreme Court to amend a 2006 order of the court that is being used by the States to appoint “favourites” as Directors-General of Police.
•The Home Ministry moved the court earlier this month to seek clarity on the order that ensures a two-year fixed term for the DGPs.
•A senior official of the Ministry said some States were misusing the order and appointing officers about to retire, giving them a fixed term of two years, irrespective of the superannuation date. The official said the implementation of the order was not monitored effectively.
Andhra govt. under fire
•Recently, the Home Ministry wrote a strong letter to the Andhra Pradesh government after the State forwarded a panel of seven officers of the rank of DGP, including three on the verge of retirement. The State had kept the post vacant for months and issued an order on November 24 to appoint N. Sambasiva Rao, an IPS officer of the 1984 batch, who was to retire on December 31. Mr. Rao is likely to hold the post till the 2019 elections.
•In 2016, the Trinamool Congress government in West Bengal issued an order allowing IPS officer Surajit Kar Purkayastha to stay in office for two years, though he attained superannuation on December 31.
•The late Tamil Nadu Chief Minister Jayalalithaa had used the order to appoint Ashok Kumar, an IPS officer of the 1982 batch, as the DGP in November 2014 for a fixed term of two years, though he attained superannuation in June 2015. Mr. Kumar, however, took voluntary retirement in September 2016, two months before the end of his tenure.
•“The All India Services Act, 1951, bars any officer from remaining in office after retirement, unless cleared by the Centre. The Home Ministry is the cadre-controlling authority for IPS officers, and the Supreme Court order is being increasingly misused by the States to appoint officers close to the regime,” the official said.
Ministry to frame norms
•The official said the Ministry would lay down guidelines to ensure that only those who had a minimum of one-and-a-half to two years to retire were included in the panel. “Most of the time these appointments are done for political gains as the officer will be obliged to return favours,” the official said.
•The court issued the order for a fixed two-year term for the DGPs after Prakash Singh, former DGP of Uttar Pradesh, filed a petition on police reforms.
📰 Skewed outlay for defence: panel
MPs’ committee says falling capital allocation will affect modernisation
•Expressing concern over the decreasing share of capital allocation in the defence budget compared with the revenue component, adversely the Parliamentary Standing Committee on Defence said the Defence Ministry should overhaul its planning and budgeting mechanism to ensure “a prudent and equitable distribution of funds to revenue and capital heads”.
•“Both components are equally important aspects of the budget; however, the committee members are deeply anguished to note that with each year, the ratio of revenue-to-capital outlay is skewed as the budget for capital acquisitions for the services is declining in comparison to revenue allocations, adversely affecting the modernisation process of our forces,” the panel said in its observations.
•These observations were part of the report presented in Parliament last week for “action taken by the government on the observations/recommendations contained in the 31st report”.
•“The committee feels that the Ministry’s reply is not corroborated with the facts as 2012-13 onwards, the ‘capital’ component of the budgetary allocation has witnessed a persistent decrease in comparison to ‘revenue’ component of the budget…,” the report said and asked the Ministry to present figures for ratio of revenue-to-capital accounts for 2017-18 at the earliest.
Ministry’s reply
•To the committee’s recommendation in the earlier report, the Ministry replied that while revenue outlay expenditure follows a pattern due to its inherent characteristics, capital outlay fluctuates depending on milestone payments and new accruals, which may not necessarily increase every year.
•The revenue component caters to salary, other recurring expenses, requirement of stores, transportation, revenue works and maintenance and others, while the capital component is for procurement of weapons and systems.
📰 The rise and fall of the WTOThe rise and fall of the WTO
As the U.S. loses interest in multilateralism in trade, India should actively try to arrest the organisation’s slide
•Less than 25 years after the World Trade Organisation (WTO) was created, its future as a body overseeing multilateral trade rules is in doubt. The failure of the recent ministerial meeting at Buenos Aires is only symptomatic of a decline in its importance.
Too ambitious?
•When the WTO was born in 1995, replacing the General Agreement on Tariffs and Trade (GATT), it was given a large remit overseeing the rules for world trade. It was also given powers to punish countries which violated these rules. Yet, in what must be an unusual development in the history of international institutions, the WTO has been felled by the weight of the extraordinary ambitions placed on it. As a consequence, since the late 2000s, the organisation has been unable to carry out its basic task of overseeing a successful conduct of multilateral trade negotiations. The rise and decline has happened quickly.
•In the early 1990s, global corporations pushed the major trading powers of the time — the U.S., the European Union (EU), Japan and Canada — for a GATT agreement that would vastly increase access for their products in foreign markets. They succeeded with the 1994 Marrakesh agreement which was supposed to be a grand bargain. The “farm subsidisers” of the U.S. and EU agreed to bring agriculture under GATT rules. In exchange, the developing countries had to pay up front by reducing import duties on manufacture, opening their markets to services, and agreeing to strict protection of intellectual property rights. The Marrakesh agreement also created the new Dispute Settlement Body (DSB) to adjudicate on trade disputes. All this would be overseen by the new WTO.
•Under the DSB, the decision of a WTO panel could be rejected only by “a negative consensus” (i.e. all member-countries present had to turn down the ruling). A final verdict in favour of a complainant country entitled it to impose penalties on the other country. And under the principle of cross-retaliation, these penalties, when authorised, could be imposed on exports from a sector different from where the dispute was located. This hurt the smaller countries and was to the advantage of the bigger ones.
•The new ability of the DSB to enforce decisions seemed too good to not take advantage of. For a brief while in the mid/late 1990s, the WTO seemed to be just the kind of “super” international organisation that the major powers wanted. If all trade and non-trade issues could be brought under one body which had the powers necessary for enforcement, there would be no place to hide for any country. There was pressure to bring many more “new” non-trade issues under the WTO. If the U.S. wanted labour and environment standards included, the EU wanted foreign investment, competition and government procurement.
•Over-reach, however, sometimes can have the opposite of the intended outcomes.
•The developing countries, which had realised that they had been in the Marrakesh agreement, were far more active in the WTO from the late 1990s. Through a combination of the formation of strategic alliances and simply refusing to say “yes”, they began to win some battles.
The China factor
•The entry of China into the WTO in 2001 also changed the picture. China used its newly acquired ‘most favoured nation’ status to the hilt. It expanded exports manifold to the EU and the U.S. Indeed, an influential body of opinion holds China’s export success as responsible for the hollowing out of U.S. manufacturing.
•On its part, the U.S. soon realised that it was not the master of all it surveyed. Conflicts with the EU, a DSB that did not always oblige, and the more assertive developing country bloc (for a while led by Brazil and India) saw the hopes for a “super” WTO gradually evaporate.
•Still, in 2001, Brussels allied with Washington to successfully push for fresh trade negotiations even before the 1994 agreement had been digested. A new round with the Doha Development Agenda (DDA), covering old and new issues, was launched in the Qatar capital in 2001. However, by refusing to make any honest concessions over the years, the U.S., aided by a willing WTO secretariat, more or less killed the DDA in the late 2000s. This intransigence showed that the WTO and its major member-countries remained as insensitive as before to the concerns of the majority of the membership. The U.S. and EU have since even sought to formally scrap the DDA.
•The major powers now cherry-pick trade issues. Thus, in 2014, trade facilitation (covering customs rules and procedures) was taken out of the DDA and a stand-alone agreement was signed, because the U.S. and the EU were interested in it. This virtually destroyed the principle of reciprocity under which each country wanting to obtain gains in specific areas makes concessions in others.
•On the whole, the U.S. and the EU have been losing interest in multilateralism in trade. The U.S. has even begun to undermine the very elements of the WTO that it had pushed through in the early 1990s. It now refuses to implement some DSB decisions. Most recently, it has taken decisions on DSB appointments which will in effect bring adjudication to a halt.
•This does not mean major powers have no use for the WTO. They may no longer see any value in it as a forum for multilateral trade agreements, but they now use it to push for stand-alone deals as well as plurilateral deals (agreements involving a few and not all members of the WTO). At Buenos Aires, proposals were made for the WTO to take up “new issues” such as e-commerce, investment facilitation and trade and gender. These are all outside the DDA and of interest only to a select membership.
Need for multilateralism
•No one should be happy about the turn of events. All countries need mutually agreed discipline on market access, customs duties, etc. Regionalism cannot be an alternative. Regional trade groups have succeeded in some places and they have not elsewhere. India’s own experience with bilateral trade agreements has not always been good. Bilateral and regional treaties also open the door to the stricter “WTO plus” conditions in select areas like patents.
•The world therefore benefits from a multilateral trade body – though a fairer one than the WTO of the 1990s. To give just one example, India is on a better wicket with its food procurement and public stock holding policies protected within the WTO than with having to negotiate separate deals with major farm exporters like the U.S., Canada, Australia and Brazil. Still, one cannot take multilateralism in trade for granted. At the extreme, one cannot rule out a collapse of the WTO engineered by the Trump administration. The consequences are unimaginable even if they do not lead to trade wars as happened in the 1930s.
•India should be more actively engaged in how to arrest the slide and then make the WTO a more equitable organisation. Commerce Minister Suresh Prabhu has said that India will soon convene a mini ministerial to discuss “new issues” for the WTO. Such fancy talk will not get us anywhere. India needs to work on persuading all members of the WTO to return to the table and negotiate on bread-and-butter issues like agriculture, industrial tariffs, and services. At this point, India and most of the world have everything to lose and nothing to gain from first a hollowing out and then a selective use of the WTO.
📰 Power of the collective: on intimate partner violence
Self-help groups can help address the problem of intimate partner violence
•Violent acts, at the hands of a husband or a partner (intimate partner violence, or IPV), are distressingly common worldwide. These stem from the belief that women who don’t obey or don’t perform their set gender roles deserve to be beaten. Intimate relationships are important sites where violence against women is used to perpetuate patriarchy. The World Health Organisation estimates that almost one-third of all women who have been in a relationship have experienced physical and/or sexual violence by their intimate partner, which affects their physical and mental well-being. Boys who witness parental violence are more likely to use it in their adult relationships; girls are more likely to justify it.
•Strategies to address IPV have included legal reforms, awareness creation drives, and strengthening of women’s civil rights. As criminal justice solutions have largely been inaccessible to socially precarious women, a more inclusive alternative is to have collective-based resolution mechanisms. The potential of large-scale groups of women, such as self-help groups (SHGs), becomes critical in the Indian context.
•India has experimented with many models of community dispute resolution mechanisms — the Nari Adalats (women courts) in various States, Women’s Resource Centres (Rajasthan), Shalishi (West Bengal), and Mahila Panchayats (Delhi) — which have seen IPV as a public issue rather than a personal problem. Several NGOs have co-opted these models so that women can resolve cases of violence without getting entangled in tedious legal processes.
•SHGs are the most widely present collectives across regions. The experiences of large-scale programmes offer valuable insights into action for IPV redressal within SHG-led development models. These, as well as previous models, provide two key lessons — one, collectives of women need adequate investment for building their capacities; and two, mediation of IPV requires specialised structures to avoid manipulation by kinship relations and political affinities.
•Not all groups of women become safe spaces to discuss violence. SHGs must first become enabling spaces where the economic and social concerns of women are stated as priorities. Freedom from violence must be stated as a necessary component of empowerment. It takes time for most women to recognise that violence is unacceptable. To enable them to understand this, there must be investment in specific training, and gender analysis processes. SHGs are mostly seen as administrative entities. Their social role can be enhanced to tackle the widespread problem of IPV.
📰 34 power projects in distress; Centre not to bear NPAs
Chhattisgarh accounts for 10 of the projects; government says contracting parties must honour the PPAs even if conditions turn difficult
•Almost a third of the distressed power plants unable to repay loans totalling crores of rupees are in Chhattisgarh, show data from the Power Ministry.
•Last week, the Ministry submitted a list of 34 such projects to a parliamentary panel on energy. Ten of them are in the BJP-ruled Chhattisgarh.
•The panel had posed a detailed questionnaire to the Union Ministries of Power, Coal and Finance, the Reserve Bank of India, the lender banks and the developers. While many of the questions were answered, the government continued to refuse to reveal the exact amount that these projects owe to the banks.
•In its reply, the government has all but shrugged off the responsibility of the high levels of non-performing assets (NPA) in the power sector. “The decision to set up a power plant is taken by concerned developer based on his own assessment,” the government said. “The developer has to arrange all inputs like land, water, necessary clearances, sale of power under the power purchase agreement.”
•“In case of power sector, over-projection of demand of electricity accompanied with the aggressive bidding decision were made by the developers and hence some of them are running in profit and a few are in loss,” it said.
•The government was vociferous in blaming the bidders of such projects, saying they should have known about the costs and efficiencies prior to bidding and quoting the low tariffs that they did.
•“It is expected that bidders would estimate their costs and efficiencies and will act rationally while quoting tariffs so as to have a fair competition,” the government said in one of its replies. “However, some of the bidders might have bid irrationally or overestimated their efficiencies or underestimated their costs and might have quoted lower tariff.”
Coal not available
•The government’s data show that the gross loans and advances given to the power sector as of June 2017 amounted to Rs. 5.59 lakh crore, of which Rs. 37,941 crore was classified as gross non-performing assets (GNPA). Within the GNPA, over 90% are from the power-generation segment, while the rest are from transmission and distribution.
•The government accepted that one of the top reasons for financial stress in thermal power projects is the unavailability of fuel arising due to the cancellation of coal blocks. However, it reiterated the sanctity of the power purchase agreements (PPA), saying that they must be honoured regardless of the extraneous situations.
•“It has been observed that the contracting parties are obliged to adhere [to] the terms and conditions of the PPA even if it becomes onerous to one of the parties to perform the contract due to change in market or other parameters subsequent to the signing of the PPA if such change is not covered by the provisions of the PPA,” the government said.
•The developers, however, beg to differ. In their answers, they have almost uniformly stated that the delay in the projects is due to reasons beyond their control. In its reply, IDFC Bank, which has financed R.K. Powergen in Chhattisgarh, says that though the plant was initially to be set up in Tamil Nadu, it was shifted to Chhattisgarh on the Ministry’s recommendation.
•The company signed an MoU with the Chhattisgarh government in 2005. The company was allotted a coal block in 2008. This allocation was later cancelled by the Supreme Court. The Chhattisgarh government also refused to honour the PPA. “The government has been resorting to coercive measures pressuring the company to cancel the PPA,” the bank said.
•To a question from the parliamentary panel on whether these assets can be taken over and made operational with government intervention, the Power Ministry said: “Generally, the government would like to act as a facilitator by taking requisite steps to address the systemic issues relating to stress.”
📰 Economy Individual insolvency code in phases: Sahoo
‘Guarantors are priority in phase one’
•Steering the ‘smooth and fast-paced’ journey of the insolvency law, the IBBI is now looking to put in place the regime for individual insolvency in a phased manner, according to its Chairperson M.S. Sahoo.
•About 500 corporates have been admitted for resolution and about 100 companies have commenced voluntary liquidation under the Insolvency and Bankruptcy Code (IBC), which is a little more than a year old.
•As it enters 2018, individual insolvency regime and facilitation of corporate insolvency transactions are among the main priorities for the Insolvency and Bankruptcy Board of India. “We are looking forward to implementing a regime for individual insolvency in a phased manner. In the first phase, we would implement the insolvency regime in respect of individuals who are guarantors to corporates undergoing resolution process,” Mr. Sahoo said.
📰 PSBs asked to rationalise overseas, domestic branches
FinMin move is part of process to bolster balance sheets
•The finance ministry has asked public sector banks to look at rationalising their domestic and overseas branches as part of the reform process to strengthen their financials.
•The banks have been advised to pursue closure of loss-making domestic and international branches as part of a capital-saving exercise, official sources said.
‘Burden on financials’
•There was no point in running loss-making branches and placing a burden on the balance sheet, so banks should look at not only big savings but also small savings like these for improving overall efficiency, sources said.
•Many banks, including State Bank of India (SBI) and Punjab National Bank (PNB), have already taken initiative.
•Besides, Indian Overseas Bank has rationalised the number of regional offices in the country by reducing 10 regional offices from the existing 59, eyeing optimum utilisation of resources and reduction in administrative costs.
•The Ministry is of the view that there is no need for multiple banks in a single country, sources said, adding that banks can explore a single subsidiary formed with 5-6 banks coming together for conserving capital and realising economies of scale.
•As part of the rationalisation strategy, PNB is exploring the sale of stake in its U.K. subsidiary, PNB International. Bank of Baroda and SBI are also examining the issue of consolidation.
📰 ‘Can commit $2 bn in guarantees for India’
MIGA’s guarantees can trigger about five times as much in FDI, says its CEO
•The Multilateral Investment Guarantee Agency — an arm of the World Bank group — which provides non-commercial guarantees, has supported 110 countries with $19 billion in guarantees across 850 projects. MIGA’s CEO and executive VP, Keiko Honda, explains how foreign direct investment receives a fillip due to the guarantees, and the agency’s plan for India. Sarvesh Suri, director, Operations Group, also joined the conversation:
Why are you planning to enter India to provide guarantees?
•Honda: The G20, including India, has strongly encouraged multilateral development banks (MDBs) to help bring in more private investment to developing countries. By doing this, we can increase the money coming to countries — like India — that have strong potential. The ADB or the World Bank Group can be used to even draw private investors to sectors they generally don’t approach, such as basic healthcare and education.
•At the same time, the ultimate user is nowadays willing to pay for large infrastructure services such as power, toll roads or other transportation.
•With India now having graduated from being low income to a lower middle-income country, this change in behaviour means more opportunities for private companies to finance projects in India.
•Some central governments used to give a lot of sovereign guarantees for their projects. But now, central governments in countries like Indonesia are more careful on how much sovereign guarantees they can extend.
•The Indian government is also smart, and heading in the same direction. The country needs to protect its credit rating and manage its balance sheet, which means municipalities and state governments have to take risk on to their own balance sheets. This is a global trend, and India is probably ahead of others in this regard.
In what sectors is MIGA looking to provide guarantees?
•Honda: We provide support in many countries for power generation, including hydro and renewables. We have also provided a lot of support for transportation, including subways, ports, airports and toll roads.
•That said, we are flexible, and like to focus on sectors where we can create higher development impact, and support the government’s development strategy. We very much like to work closely with the central and state governments, and have received positive responses from them.
•Suri: It would be more in the core infra areas like power, transportation, roads, railway, metro rail.
How much do you plan to provide in guarantees for Indian infrastructure? How will that affect inbound FDI?
•Honda: If there is a good opportunity, and we can find the right projects, we are ready to commit $2 billion in guarantees in India. With a multiplier effect, the $2 billion that we provide in coverage can often draw in $10 billion or more in private investment.
What is the feedback from private investors about the investment climate in India?
•Honda: The same foreign investors we work with closely in Turkey, Vietnam, Bangladesh, South, Africa, Brazil and Mexico are also willing to come to India. Some of them that are equity investors not only have money, but also expertise in areas like water treatment, building subways and metros and renewable energy.
•Private investors we work with are interested in financing projects in India, and are asking us to join them. Our involvement in projects gives them a lot of comfort, and as they get more comfortable with the projects and local context, they may even cancel our guarantees after 3-4 years, which is perfectly fine with us.
•Overall, FDI to developing countries has declined every year in the last six years. On the other hand, FDI has been increasing for India.
•Suri: We also have what we call MIGA Performance Standards. These are environmental and social standards which help to structure and implement sustainable projects. Our experience is that once we structure projects, taking all the relevant risks into account, the chances of projects getting stuck later are much lower.
•We perceive India to be a low-risk country as compared to our overall portfolio. Close to 25% of our portfolio is in sub-Saharan Africa. We operate in far riskier environments, and help reduce the risk perception as well as actual risk for investors in those countries.
How much FDI was generated for your guarantees in recent years?
•Honda: In financial year 2016-17 (July 2016 – June 2017), our direct guarantees totalled $4.7 billion. This had generated $16 billion of FDI. The year before, our direct guarantees amounted to $4.3 billion, and enabled FDI of $27 billion.
MIGA has been criticised by climate activists for promoting fossil fuels. How are you responding?
•Honda: Climate finance is one of our top three focus areas. We are targeting that 28% of the annual guarantees we issue by 2020, as compared to 24% now, will be in climate finance. At the same time, 13 billion people in the world do not have access to power.
📰 Tackling Maoism
A permanent solution lies in reversing the alienation of tribals
•The Central Reserve Police Force lost 40 personnel in two Maoist attacks in the first half of 2017 in Sukma, the most severely Maoist-affected district of Chhattisgarh. Though the forces were jolted by these attacks, their spirit to fight back has not dampened. Rather, they continue to undertake challenging development work in these areas. This shows how the paradigm on tackling Maoism has changed over time. The government’s response has matured in terms of deliverance — from reactive it has become proactive, and from localised it has become holistic.
Proactive policing
•Security forces are no longer reactive. When the Maoists decided to deepen their roots into Gariaband, the State government notified this division as a new district, which gave a fillip to development work. Many new police stations and security camps were set up to prevent any major Maoist attack. The cadre strength of the Maoists has consequently reduced. Similarly, a police action in Raigarh district eventually forced the Maoists to abandon their plan of expansion. The Ministry of Home Affairs, too, subsequently removed Raigarh from its Security Related Expenditure scheme.
•When the Maoists decided to create a new zone in Madhya Pradesh, Maharashtra and Chhattisgarh, the target districts were immediately put on alert, so as not to allow them to gain ground. Security forces were redeployed to ensure better territorial command. As the Chhattisgarh police have experience in tackling Maoists in Bastar, they are now coordinating with the bordering States to strengthen intelligence and ground presence. Such coordinated proactive policing will dampen the Maoists’ plans.
•The Maoist problem is not merely a law and order issue. A permanent solution lies in eliminating the root cause of the problem that led to the alienation of tribals in this area. The focus now is to build roads and install communication towers to increase administrative and political access of the tribals, and improve the reach of government schemes. The government has enhanced the support price of minor forest produce like imli(tamarind). More bank branches have been opened to ensure financial inclusion. All India Radio stations in the three southern districts of Bastar will now broadcast regional programmes to increase entertainment options. And a new rail service in Bastar is set to throw open a new market for wooden artefacts and bell metal.
•United Nations Secretary-General Antonio Guterres has said in the latest annual report report on ‘Children in Armed Conflict’ that the Maoists are providing combat training to children in Jharkhand and Chhattisgarh. Despite the Maoists not wanting their children to study and get government jobs, remarkable work has been done in the field of school education and skill development. Earlier, the hostel of the Ramakrishna Mission in Narainpur was the only place where children could get quality education. Then, an educational hub and a livelihood centre in Dantewada district sprang up. Seeing its success, the government has now opened up livelihood centres, known as Livelihood Colleges, in all the districts. If the youth are constructively engaged by the government, the recruitment of youth by the Maoists will slowly stop.
Role of civil society
•However, winning a psychological war against the Maoists remains an unfinished task. Though the government’s rehabilitation policies have helped the surrendered cadres turn their lives around, security personnel are still accused of being informers and are killed. To end this, civil society must join hands with the government in realising the villagers’ right to development. Loopholes in implementing government schemes must not be used as a tool to strengthen the hands of the Maoists. Indian democracy is strong enough to absorb even its adversaries if they abjure violence.
•The last two major attacks call for some serious introspection on the tactics used by the forces and their fitness to prevent any future attacks. The two-pronged policy of direct action by the security forces combined with development is showing results — the government has already made a dent in most of the affected districts and is determined to check the expansion of Maoists. The paradigm of proactive policing and holistic development should ensure more such significant results in the future.
