📰 U.S. imposes ‘toughest ever’ sanctions on Iran
India, China, Greece, Italy, Turkey, South Korea, Taiwan and Turkey get U.S. sanctions waivers for Iran oil imports
•The Trump administration’s tough new sanctions on Iran took effect on Monday but eight major importers of Iranian oil were spared from immediate penalties.
•The sanctions target Iran’s energy, financial and shipping sectors and are aimed at crippling the country’s economy following President Donald Trump’s withdrawal from the 2015 nuclear deal. The measures restore all the U.S. sanctions that had been lifted under the accord that gave Iran billions of dollars in sanctions relief in exchange for curbs on its nuclear programme.
•The sanctions freeze any assets that those targeted have in U.S. jurisdictions and bar Americans from doing business with them. They will also affect non-Iranian companies that deal with sanctioned Iranian firms and officials.
•President Trump says that he wants to get Iran back to the negotiating table on the nuclear issue. The Trump administration also says it wants to stop what it calls Tehran’s “malign” activities including cyber attacks, ballistic missile tests, and support for terror groups in the Middle East.
Rare temporary exemptions
•India and China — the two biggest buyers of Iranian crude, have so far appeared to have skipped the punitive American sanctions targeting the Iranian oil and financial sectors.
•The two Asian giants are believed to be among the eight countries that have been given the rare temporary exemptions from the Iranian sanctions that kicked off on Monday.
•The Trump administration said it has asked these countries, including Turkey, Greece, Italy, Japan and South Korea, to bring down their oil purchase to zero as soon as possible.
•Secretary of State Mike Pompeo said the waivers, which expire in six months, were necessary to avoid disruption of world oil markets and to give the eight countries more time to eliminate their imports. During those six months, the importing country can buy Iranian oil but must deposit Iran’s revenue in an escrow account. Iran can spend the money but only on a narrow range of humanitarian items.
•Seeking to deflect criticism from some Iran hawks concerned that the sanctions don’t go far enough, Mr. Pompeo stressed that U.S. pressure on countries to stop buying Iranian oil had already reduced its exports by more than a million barrels of crude per day.
•“Rest assured, Iran will never get close to obtaining a nuclear weapon under President Trump’s watch,” he said.
•Mr. Pompeo also said limited waivers had been issued to allow European and other firms to continue conversion work on two of Iran’s nuclear facilities.
'Toughest ever' on Tehran
•India, which is the second biggest purchaser of Iranian oil after China, is willing to restrict its monthly purchase to 1.25 million tonnes or 15 million tonnes in a year (300,000 barrels per day), down from 22.6 million tonnes (452,000 barrels per day) bought in 2017-18 financial year, sources in New Delhi had said last week.
•The reimposition of U.S. sanctions on Iran, Mr. Pompeo asserted are “the toughest ever” on Tehran.
•They’re aimed at a singular purpose, denying the world’s largest state sponsor of terrorists the capacity to do things like they did this past couple weeks, attempted assassination campaign in the heart of Europe, he said.
•"These sanctions have already had an enormous impact. We’ve already reduced Iranian crude oil experts by over a million barrels per day. That number will fall farther. There’s a handful of places were countries that have already made significant reductions in their crude oil exports need a little bit more time to get to zero, and we’re going to provide that to them," he said.
'We’ll see what happens with Iran'
•Trump told reporters on Sunday that the sanctions are the strongest ever imposed by the U.S.
•“The Iran sanctions are very strong. They’re the strongest sanctions we’ve ever imposed. We’ll see what happens with Iran, but they’re not doing very well, I can tell you,” Mr. Trump told reporters at the White House. The President did not respond to a question about the waiver.
•At an election rally on Sunday, Mr. Trump said the Iranian regime now just want to survive.
•“I withdrew the United States from the horrible, one-sided Iran nuclear catastrophe. And Iran is a much different right now than it was before I took office,” Trump said at an election rally in Chattanooga in Tennessee.
•“They were doing bad things, and they are doing bad things now, but they don’t have the same perspective. They were looking for the Mediterranean... They wanted to take over the whole Middle East. Right now, they just want to survive,” Mr. Trump said.
•In May, President Trump had pulled U.S. out of the 2015 Joint Comprehensive Plan of Action (JCPOA) terming it as disastrous. Under the Obama-era deal, involving five permanent members of the U.N. Security Council and Germany, Iran agreed to stop its nuclear programme in exchange for relief from economic sanctions.
'Economic war'
•President Hassan Rouhani on Monday said Iran “will proudly bypass sanctions” by the U.S.
•“We are in a situation of economic war, confronting a bullying power. I don’t think that in the history of America, someone has entered the White House who is so against law and international conventions,” he added.
📰 India's nuclear triad is complete with INS Arihant ending its first deterrence patrol
Modi points out that the success of INS Arihant enhanced India’s security needs
•India on Monday declared that its nuclear triad, stated in its nuclear doctrine, is operational after indigenous ballistic missile nuclear submarine INS Arihant achieved a milestone by conducting its first deterrence patrol.
•This means that Arihant is now prowling the deep seas carrying ballistic missiles equipped with nuclear warheads. “Prime Minister Narendra Modi received today [Monday] the crew of ship submersible ballistic nuclear (SSBN) INS Arihant. The submarine recently returned from its first deterrence patrol, completing the establishment of the country’s survivable nuclear triad,” the Prime Minister’s Office said in a statement.
•Calling it a major achievement for the entire nation, Mr. Modi said the success of INS Arihant enhances India’s security needs.
•“True to its name, INS Arihant will protect the 130 crore Indians from external threats and contribute to the atmosphere of peace in the region,” he said in a tweet.
•Wishing the team members behind the project and their families on the occasion of Deepavali, the Festival of Light, Mr. Modi expressed the hope that “just as light dispels darkness and all fear, INS Arihant will be harbinger of fearlessness for the country.”
•Given India’s stated position of ‘No-First-Use’ (NFU) in launching nuclear weapons, the SSBN is the most dependable platform for a second-strike. Because they are powered by nuclear reactors, these submarines can stay underwater indefinitely without the adversary detecting it. The other two platforms — land-based and air-launched are far easier to detect.
•“This places India in the league of the few countries that can design, construct and operate SSBN,” Defence Minister Nirmala Sitharaman tweeted on the development.
•As reported by The Hindu earlier, Arihant was quietly commissioned into service in August 2016 but its induction was never officially acknowledged. It has a displacement of 6000 tonnes and is powered by an 83 MW pressurised light-water reactor with enriched uranium.
•The Advanced Technology Project (ATV) project began in the 1980s and the first of them, Arihant, was launched in 2009 by Prime Minister Dr. Manmohan Singh. Since then it underwent extensive sea trials and the reactor on board went critical in 2013.
•In 1998, India conducted nuclear tests under Pokhran-II and in 2003, it declared its nuclear doctrine based on credible minimum deterrence and a NFU policy while reserving the right of massive retaliation if struck with nuclear weapons first.
•Arihant is presently armed with K-15 Sagarika missiles with a range of 750 km and will eventually carry the longer 3,500 km range K-4 missiles being developed by the Defence Research and Development Organisation (DRDO).
•The second submarine in the series, Arighat is now undergoing sea trials after which it will be inducted into service.
📰 New rules for foreigners in detention centres
Inappropriate to separate families: SC
•The government has informed the Supreme Court that new guidelines are being framed for keeping foreign nationals in detention centres across the country.
•A Bench led by Justice Madan B. Lokur was hearing the issue of framing of a manual detailing the guidelines for detaining foreigners. The condition of detention centres in Assam also came up for discussion.
•The Bench had sought responses from the Centre and the Assam government on the plight of families, who languish in the State’s six detention centres as “declared foreigners”, separated from each other and their children.
•The court said it was “inappropriate” to keep the families separated without any valid reason.
•Solicitor General Tushar Mehta, for Assam, submitted that tenders had been invited by Assam for setting up of a new detention centre in Goalpara.
•The court posted the matter for hearing in February next year.
📰 Preserving the taboo: on nuclear arms control
Existing nuclear arms control agreements need to be brought in line with today’s political realities
•Last month, U.S. President Donald Trump declared that the U.S. is quitting the Intermediate-Range Nuclear Forces (INF) Treaty, a bilateral agreement with Russia signed in 1987. The decision was not unexpected since the U.S. has long maintained that Russia has been violating the treaty and Mr. Trump has been critical of arms control agreements because, according to him, other countries cheat putting the U.S. at a disadvantage.
•Mr. Trump’s decision has generated dismay and concern that this will trigger a new nuclear arms race in Europe and elsewhere. What it ignores is that the INF Treaty reflected the political reality of the Cold War — of a bi-polar world with two nuclear superpowers — no longer consistent with today’s multi-polar nuclear world. The greater challenge today is to understand that existing nuclear arms control instruments can only be preserved if these evolve to take new realities into account.
•Under the INF Treaty, the U.S. and the U.S.S.R. agreed to eliminate within three years all ground-launched-missiles of 500-5,500 km range and not to develop, produce or deploy these in future. The U.S. destroyed 846 Pershing IIs and Ground Launched Cruise Missiles (GLCMs); and the U.S.S.R., 1,846 missiles (SS-4s, SS-5s and SS-20s), along with its support facilities.
Politics of negotiations
•The INF Treaty was widely welcomed, especially in Europe because these missiles were deployed in Europe and the treaty was signed on December 8, 1987 in Washington by U.S. President Ronald Reagan and Soviet General Secretary Mikhail Gorbachev. Reagan had earlier declared, “A nuclear cannot be won and must never be fought,” marking a ratcheting down of Cold War tensions that had been rising. By the early 1980s, the U.S.S.R. had accumulated nearly 40,000 nuclear weapons, exceeding the U.S. arsenal. In Europe, Russia replaced single warhead SS-4s and SS-5s with more accurate 3-warhead SS-20 missiles, heightening concerns. To reassure its North Atlantic Treaty Organisation (NATO) allies about its nuclear umbrella, the U.S. began deploying Pershing IIs and GLCMs in the U.K., Belgium, Italy and West Germany, setting off a new arms race.
•Growing rhetoric made the Europeans nervous. Realisation dawned that any nuclear conflict on European soil would only lead to more European casualties, catalysing a movement for ‘no-deployments’ in Europe. In the 1980s, the U.S. and the U.S.S.R. began three sets of parallel negotiations — on strategic weapons leading to the Strategic Arms Reduction Treaty (START), on intermediate-range weapons leading to the INF, and the Nuclear and Space Talks to address Soviet concerns about Reagan’s newly launched ‘space wars’ programme (Strategic Defense Initiative).
•The INF talks originally considered equal ceilings on both sides but then moved to equal ceilings and non-deployment in Europe to address the sensitivities of allies. The U.S.S.R. wanted British and French missiles of similar ranges to be covered but the U.S. rejected the idea as also the inclusion of older 72 Pershing I missiles already deployed in Germany. To break the stalemate, German Chancellor Helmut Kohl made an announcement that Germany would unilaterally dismantle the Pershing 1s while the U.S.S.R. came up with a double global zero covering both shorter-range and intermediate-range missiles.
•The U.S. agreed, Europe breathed a sigh of relief and the INF was hailed as a great disarmament treaty even though no nuclear warheads were dismantled and similar range air-launched and sea-launched missiles were not constrained. Since it was bilateral, the INF Treaty did not restrict other countries but this hardly mattered as it was the age of bi-polarity and the U.S.-U.S.S.R. nuclear equation was the only one that counted.
Changing political backdrop
•Fast forward to 2018. Since 2008, the U.S. has voiced suspicions that with the Novator 9M729 missile tests, Russia was in breach; in 2014, U.S. President Barack Obama formally accused Russia of violating the INF Treaty. However, he refrained from withdrawal on account of European concerns. On the other hand, Russia alleges that the U.S. launchers for its missile defence interceptors deployed in Poland and Romania are dual capable and can be quickly reconfigured to launch Tomahawk missiles, constituting a violation. China has always had a number of Chinese missiles in the 500-5,500 km range but its modernisation plans, which include the commissioning of the DF-26, today raise the U.S.’s concerns.
•The U.S.’s 2018 Nuclear Posture Review (NPR) reflects a harsher assessment of the security environment faced by the U.S. and envisages a more expansive role for nuclear weapons than in the past. Russia is blamed for seeking the break-up of NATO and a re-ordering of ‘European and Middle East security and economic structures in its favour’. China is identified for the first time as a strategic competitor seeking regional hegemony in the Indo-Pacific region in the near-term and ‘displacement of the U.S. to achieve global pre-eminence in the future’. A 30-year modernisation plan with a price tag of $1.2 trillion with new nuclear-armed sea-launched cruise missile (SLCMs) and low-yield warheads is detailed in the NPR. Russia has unveiled plans to develop a new nuclear torpedo and nuclear-powered cruise missile.
•Even more worrisome are developments that blur the line between nuclear and conventional weapons. In order to lessen its dependence on nuclear weapons, the U.S. developed layered missile defences and conventional Prompt Global Strike (PGS) capabilities that use conventional payloads against strategic targets. Other countries have responded with hypersonics and a shift to lower yield tactical warheads. With growing dependence on space-based and cyber systems, such asymmetric approaches only increase the risks of accidental and inadvertent nuclear escalation.
Preserving the nuclear taboo
•The key difference with today’s return of major power rivalry is that it is no longer a bi-polar world, and nuclear arms control is no longer governed by a single binary equation. There are multiple nuclear equations — U.S.-Russia, U.S.-China, U.S.-North Korea, India-Pakistan, India-China, but none is standalone. Therefore, neither nuclear stability nor strategic stability in today’s world can be ensured by the U.S. and Russia alone and this requires us to think afresh.
•The INF Treaty is not the first casualty of unravelling nuclear arms control. In December 2001, the U.S. unilaterally withdrew from the 1972 Anti-Ballistic Missile (ABM) Treaty with the U.S.S.R. which limited deployment of ABM systems thereby ensuring mutual vulnerability, a key ingredient of deterrence stability in the bipolar era. The next casualty is likely to be the New START agreement between the U.S. and Russia, which will lapse in 2021, unless renewed for a five-year period. This limits both countries to 700 deployed intercontinental ballistic missiles (ICBMs), submarine-launched ballistic missile (SLBMs) and heavy bombers and 1,550 warheads each. However, Mr. Trump has described it as “one of several bad deals negotiated by the Obama administration”. The lapse of the New START would mark the first time since 1968 that the U.S. and Russian nuclear arsenals would be unconstrained by any agreement.
•The political disconnect is also evident in the Treaty on the Non-Proliferation of Nuclear Weapons (NPT), the most successful example of multilateral arms control. It has become a victim of its success. It can neither accommodate the four countries outside it (India, Israel, North Korea and Pakistan) as all four possess nuclear weapons, nor can it register any progress on nuclear disarmament. It succeeded in delegitimising nuclear proliferation but not nuclear weapons. This is why NPT Review Conferences have become increasingly contentious.
•The most important achievement of nuclear arms control is that the taboo against use of nuclear weapons has held since 1945. Preserving the taboo is critical but this needs realisation that existing nuclear arms control has to be brought into line with today’s political realities.
📰 No respite from poverty for Muslims
Government intervention is required to improve educational and economic indicators
•The National Sample Survey Office (NSSO) labour force survey reports that the economic condition of Muslims does not show any signs of improvement despite India being the fastest-growing large economy. An analysis of the data on economic and educational indicators for various religious groups reveals that Muslims are facing a vicious circle of poverty.
Lowest education levels
•The NSSO’s 68th round (2011-12) provides estimates of education levels and job market indicators across major religious communities in India. The educational attainment of Muslims is the least among all these communities. In urban areas, the number of male Muslim postgraduates is as low as 15 per 1,000. This number is about four times lower than that of other communities, including Hindus, Christians and Sikhs. The situation is similar for Muslim women. The number of male graduates among Muslims is 71 per 1,000, less than even half the number of graduates (per 1,000) in other communities. Similarly, the number of Muslims educated up to the secondary and higher secondary levels is 162 and 90 per 1,000 persons, respectively, again the least among all the communities.
•Poor achievement at higher levels of education is partly a reflection of sinilarly low levels of school education or of illiteracy. Around half the Muslim population over 15 years is either illiterate or has only primary or middle school education. The number of illiterate people is highest among Muslims (190 per 1,000), followed by Hindus (84), Sikhs (79) and Christians (57). The number of persons (over 15 years) who have obtained just primary or middle school education among Muslims is 257 and 198 (per 1,000 persons), respectively. Thus, as compared to other communities, the distribution of the Muslim population is least at the higher levels of education and highest at the lower levels of education.
•Likewise, the current attendance rate among Muslims is least across all age groups. The number of Muslim males of 5-14 years in urban areas attending educational institutions is 869 per 1,000 persons, which is the least among all religious groups. It is higher among Christians (981), followed by Sikhs (971), though it is lower among Hindus (955), possibly because Scheduled Castes and Scheduled Tribes have lower rates. The gaps in the current attendance rates of Muslims and those of other religious groups are increasingly pronounced at higher age groups.
•That Muslims have the lowest attendance rates and educational attainment, especially in higher education, can be explained by their income level and higher costs for post-secondary education. According to the NSSO survey, the average per capita consumption expenditure (used as an indicator of income) among Muslims is just ₹32.66 per day, which is the least among all religious groups. It is highest among Sikhs (₹55.30), followed by Christians (₹51.43) and Hindus (₹37.50). As per the 71st NSSO survey on education (2014), the average course fee for college degrees in technical courses in government and private unaided institutions was ₹25,783 and ₹64,442, respectively. That is too high for Muslims to afford, given their per capita income.
•Although children up to age 14 have a right to free and compulsory education, the average course fee per student for upper primary education is still ₹508 for the academic session. While the course fee is the same for all religious groups, its burden is highest among Muslims due to their per capita income. The course fee for upper primary education accounts for 8.5% of the yearly per capita spending for Muslims, followed by Hindus (7.4%), Christians (5.4%) and Sikhs (5.03%). The higher burden of the cost of education among Muslims, relative to their incomes, could be one of the factors responsible for their lowest attendance rates.
•The high level of illiteracy among Muslims and the low levels of general education ensure that they are trapped in a vicious circle of poverty. The lack of higher education is adversely affecting their job indicators. The dynamics of labour markets are largely a function of the degrees of knowledge and skills. For example, the labour force participation rate (LFPR), defined as the number of persons either employed or seeking jobs, is significantly linked to the desire for work, which in turn is dependent upon educational attainment. Similarly, the quality of employment is strongly linked to levels of education and skills. Therefore, if a community is lagging in education, it risks being trapped in a vicious circle of poverty. This is a situation that is difficult to break out of without government intervention.
•The signs of Indian Muslims being caught in a vicious circle of poverty are visible in terms of their low consumption expenditure and poor job market indicators, including LFPR, employment status, and worker population ratio. The NSSO data show that LFPR among Muslims is 342 and 337 (per 1,000) in urban and rural areas, respectively, the least among all the religious communities. This implies that only 342 persons per 1,000 persons of working age among Muslims in urban areas are employed or available for work. Similarly, the LFPR among Muslim women is worse than that among women of other communities. Given that Muslims live predominantly in urban areas (unlike other poorer communities like SCs/STs), where work outside the home could be available, this low LFPR is likely explained by their low levels of education.
•Likewise, the worker population ratio (WPR), defined as the number of persons employed per 1,000 persons, is lowest among Muslims, both in rural and urban areas. Further, among urban males, the number of Muslims employed in regular jobs is only 288 per 1,000 employed persons, while the corresponding figure among urban Muslim females is merely 249, which is the lowest among all other communities. The number of regular employees per 1,000 employed persons is higher among Christians (494 among urban males and 647 among urban females), followed by Hindus (463 and 439), and Sikhs (418 and 482). Similarly, the proportion of households with their major source of income from regular salaried jobs is the lowest among Muslims.
What could be done
•The Central and State governments could take concerted steps to help Indian Muslims escape this vicious circle of poverty. One way to improve their situation is to provide a special incentive and subsidy system for higher education. That will ensure that schoolgoing students continue to higher levels of schooling and higher education. Similarly, students who don’t wish to continue in general academic education must have access to vocational education from Class 9 onwards.
📰 The long arm of the state
Authoritarian states are brazenly challenging the liberal order
•We live in strange times. While discussions about ‘global disorder’ mostly pertain to U.S. President Donald Trump’s penchant for challenging the established liberal order and institutional frameworks, there is another side to this as well, reflected in the way authoritarian states are now more empowered than ever to challenge norms that the world was taking for granted until recently.
Empowered states
•Last month, the Interpol chief and Chinese Vice-Minister for Public Security, Meng Hongwei, vanished after taking a flight to China from France. Beijing later revealed that Mr. Meng had been detained and was being investigated for corruption. His wife has denied these allegations and has made a public appeal for his safety, suggesting that even her life could be under threat.
•Mr. Meng is the latest high-ranking official to fall victim to sweeping anti-corruption measures under Chinese President Xi Jinping. Mr. Xi’s presidency has seen more than 1.5 million officials being punished as part of an expanding crackdown on graft in public office. He remains focussed on an extraordinary concentration of power in his own hands, underscoring the supremacy of the Communist Party of China (CPC) at every level. Central to ‘Xi Jinping Thought’, which is China’s new official political doctrine, is the idea that fealty to the party is no longer a choice but a duty, much like what it was in the Mao era. Mr. Xi enhanced his powers further this year by forming a National Supervisory Commission, which has sweeping powers to investigate not only CPC members but also state-owned companies, hospitals, schools and even sports teams.
•China’s record of disappearing human rights activists and political dissidents is quite extraordinary by global standards, but under Mr. Xi, it has taken an altogether new dimension. In July, Fan Bingbing, one of China’s most well-known actresses, vanished for three months only to resurface with a statement in which she not only apologised for evading taxes but also underscored her loyalty to the CPC.
•Saudi Arabia has gone a step forward in the Jamal Khashoggi case. The prominent journalist and vocal critic of the Saudi Arabian government was murdered in the Saudi Arabian consulate in Istanbul last month. After denying any wrongdoing for days, Saudi Arabian officials finally blamed his death on a “rogue operation”. Saudi Arabian Foreign Minister Adel al-Jubeir said that the murder was executed by people who operated “outside the scope of their authority.” He called the killing a “tremendous mistake” that was worsened by the “attempt to try to cover [it] up”. He insisted that the action had not been ordered by Crown Prince Mohammed bin Salman, a line that no one is willing to buy.
•Mohammed bin Salman, or MBS as he is called, was seen by many in the West as the great hope in Saudi Arabia. His reforms included lifting the ban on women driving, reintroducing public entertainment and curbing the power of the unpopular religious police. His ambitious undertaking to wean the country off its dependence on oil income by building a $500 billion futuristic city in the desert was hailed by many, but his political instincts remain as autocratic as his predecessors: he locked up dozens of princes and business figures last year in a luxury hotel on charges of corruption and even detained Lebanese Prime Minister Saad Hariri and allegedly forced him to resign on television.
•Then there’s Russia, which turns its own political killings of Kremlin critics into something of an art form. Killings outside Russia of those accused of “extremism” were even given legal sanction by the Russian Parliament in 2006. According to various estimates, Russia is suspected to have organised the killings of at least 15 people on British soil alone over the past two decades. The poisoning of former Russian double agent Sergei Skripal earlier this year was a state-sponsored Russian assassination attempt.
Gasping for breath
•As Western liberal states get mired in their own domestic problems and start focussing inwards, authoritarian states like these are brazenly challenging long-held global norms, even creating new ones by the sheer force of raw power. The idea once held so dear by global liberal elites that economic and technological globalisation would undermine authoritarian systems by empowering the individual is being challenged as authoritarian states are now using the same forces to their own advantage. The long arm of the state is getting longer. No wonder the liberal order is gasping for breath.
📰 Centre eyes seaplanes in UDAN 3
Plan is to connect destinations including Tehri Dam, Sabarmati Riverfront
•Seaplanes may soon be operating commercial passenger flights in India with the Centre inviting bids for connecting selected destinations under the regional connectivity scheme (RCS).
•Included among the 10 destinations that the government proposes to connect through seaplanes are the recently unveiled Statue of Unity at Sardar Sarovar Dam, Sabarmati Riverfront in Ahmedabad, Tehri Dam in Uttarakhand and Nagarjuna Sagar in Telangana.
•Opening the third round of the RCS, the Ministry of Civil Aviation has invited proposals for air routes that include tourist destinations. The deadline for submitting applications is November 20.
Struggling bidders
•In the latest phase, the Centre is reoffering 34 airports that weren’t successfully connected, primarily because two airlines — Air Odisha and Air Deccan — were unable to operate routes they had bid for due to lack of funds. Some destinations have been put on the block again as helicopter operations failed to take off.
•The previous two rounds saw a total of 428 routes awarded to 17 airlines and helicopter operators. Air Odisha was granted rights to connect 54 routes and Air Deccan 30, but both have been able to only start 10 routes each, which too see erratic services.
•“Few airports which are deprived of regular connectivity due to default of few airlines have been added [in the third round],” said a senior official of the Ministry of Civil Aviation, speaking on condition of anonymity.
•The Centre has also offered 23 tourist destinations including Bodh Gaya, Agra, Kanha, Varanasi, Hampi, Mysore and Kullu.
📰 Wilful on defaulters? : on RBI
The RBI should share the details sought by the Central Information Commission
•The Reserve Bank of India finds itself in the midst of another tangle. The Central Information Commission (CIC) has directed RBI Governor Urjit Patel to show cause “why maximum penalty should not be imposed on him for” the central bank’s ostensible “defiance” of Supreme Court orders on disclosing the names of wilful defaulters on bank loans worth hundreds of crores of rupees. In his order dated November 2, Information Commissioner M. Sridhar Acharyulu has come down heavily on the RBI and its chief for failing to uphold the interest of the public at large and not fulfilling its statutory duty to the depositors, the economy and the banking sector, by privileging individual banks’ interests over its obligation to ensure transparency. At the heart of the matter is the issue of burgeoning bad loans at the country’s commercial banks, which by the RBI’s own admission had, at the gross level, surged to 11.6% of all advances as on March 31, 2018, from September 2017’s 10.2% level. While the central bank has repeatedly acknowledged the gravity of the problem it faces, including in ensuring more accountability from the more numerous public sector banks over which it wants greater control, it has consistently invoked both the risk to the country’s “economic interest” and its “fiduciary” relationship with lenders to avoid sharing information on the largest defaulters with RTI applicants.
•Citing the apex court’s 2015 order, where the judges had directed the central bank to comply with the provisions of the RTI Act after observing that the “RBI has no legal duty to maximise the benefit of any public sector or private sector bank, and thus there is no relationship of ‘trust’ between them”, Mr. Acharyulu rhetorically asked how the rule of law could be secured if a regulator like the RBI would not “honour” a constitutional institution’s directions. The CIC order is also unsparing of the government for not being more forthcoming. Mr. Acharyulu has justifiably asked the Finance Ministry why it should not explain to the people the action taken, or contemplated, to recover dues from wilful defaulters, who owe banks more than ₹50 crore, and, where warranted, the criminal proceedings initiated. While it is no one’s argument that all large unpaid loans are by-products of mala fide borrowing, the onus is on the RBI and the government to make as clean a breast of it as is legally possible, in order to retain public trust. Given that the RBI has initiated steps to set up a digital Public Credit Registry that would include details of all borrowers including wilful defaulters, it would behove the banking regulator to meet the CIC’s November 16 deadline for furnishing the information sought about those owing ₹1,000 crore or more, to start with.
📰 The forgotten million: on Indian soldiers in World War I
As the sacrifice of Indian soldiers in World War I is recognised, the lessons too matter
•One hundred years after the end of World War I, the immense sacrifice and contributions of well over a million soldiers of undivided India are being incrementally recognised and memorialised the world over. In France, the centenary celebrations of Armistice Day on November 11 will include the unveiling of the second overseas national war memorial for Indian soldiers, by Vice President M. Venkaiah Naidu. The first such memorial abroad, formalised in 2002, is the Menin Gate in Ypres, Belgium, which is a recognition that more than 130,000 Indian soldiers fought in WWI in Belgium, at least 10,000 of whom lost their lives on the battlefield. Last month, British Prime Minister Theresa May pledged to wear a khadi poppy in honour of more than 74,000 soldiers from pre-Partition India who fought on the side of the allies and died in battle. She particularly noted that 11 of them won the Victoria Cross for their outstanding bravery and played a crucial role in the war across continents. Yet far from the ceremonial pomp of officialdom is perhaps the most poignant symbol of how much ordinary Indian men enlisting in the colonial government’s Army gave of their lives to fight the German, Austro-Hungarian and Ottoman Empires: the British Library in London has received 1,000 pages of war-veteran interview transcripts recorded in the 1970s, which include details of the inhumane treatment, including floggings, denial of home leave, and brazenly racial-discriminatory treatment that 1.5 million mostly-illiterate men from northern India faced regularly within the allied forces army.
•In the early days of the War, troops of the Indian Army, backed by the political bourgeoisie, were enthusiastic in responding to the British government’s call for military support from India. This was because, although the swadeshi movement was underway, the freedom movement was in a fledgling stage. Even Mahatma Gandhi was open to Indians enlisting and learning to defend themselves using arms, as were leaders such as Bal Gangadhar Tilak. However, with the enormous death toll by the end of WWI, the painful lessons were absorbed and the pressure for enlistment of Indians in the World War II effort produced an entirely different outcome — the Quit India movement and the escalation of the freedom movement. WWI also influenced the collective psyche of the government of independent India, starting with the tenets of non-alignment that came to embody a core mantra of the country’s foreign policy ethos. However, while India remains wary of ‘treaty alliances’ and steers clear of combat involvement in third-party conflicts, it is the third-largest contributor of military and police personnel to UN peacekeeping missions. Difficult though the conditions Indian peacekeepers face must be, they must be thankful that their country would never put them in the sort of situation that their predecessors faced from 1914 to 1918.
📰 In defence of Urjit Patel
The government has overreacted in negotiating its differences with the RBI
•The unfolding public falling-out between the Reserve Bank of India (RBI) and the Finance Ministry is post-liberalisation India’s nastiest such rift — that too when the two sparring sides are led by non-aggressive personalities. If Finance Minister Arun Jaitley is non-confrontational, RBI Governor Urjit Patel is scholarly and dignified.
•Central bank-government tensions are a common phenomenon. Successive governments have been in provocative situations with the RBI. On each occasion, the individuals involved defused tensions and found durable solutions outside the Section 7 consultation process.
•Never used before in the 83 years of the RBI’s history, this process has been initiated for managing intractable disputes in not one or two, but three policy matters. Post-consultations, the government can give written directions to the RBI in ‘public interest’.
•The disagreements relate to the RBI’s stringent restrictions on government-run banks whose non-performing assets (NPAs) have grown so much, that the only way of preventing risk spilling from them into the whole financial system is to quarantine their lending. A second source of friction is government’s insistence that the RBI go soft on power companies defaulting on loan repayments.
•The third dispute is seigniorage, an eternal conflict. The RBI generates surpluses in the various money markets operations it runs. The RBI transfers part of the surpluses to the government, and with the rest it maintains various reserves to draw from in times of financial instability or contingencies.
•The Finance Ministry wants the RBI to reset the formulae so that larger surpluses become free for transfer to the government. Determined moves of the sort were resisted most recently by Governors Y.V. Reddy and D. Subbarao, both ex-IAS and old Ministry hands.
Changing procedures
•The long-standing battle escalated in 2015. Differences were so sharp that a substitute for the Finance Secretary was nominated to attend the RBI’s Board meetings. For the first time, an interview with a panel headed by Cabinet Secretary was instituted in the selection process for appointing the RBI Governor. Dr. Patel was chosen through this revamped process. Mr. Jaitley was not a member on the selection committee headed by the Cabinet Secretary or of the Appointments Committee of the Cabinet (ACC). His views were taken onboard informally.
•The RBI has in recent years passed on its surpluses in totality to the government, transferring nothing to its own reserves. It is working on a framework that will assess its risk-buffer requirements in a systematic way for determining the transferable surpluses every year.
•Still not satisfied, the Ministry has initiated Section 7 consultations for dipping into the RBI’s war chest for ₹3.6 lakh crore. For Ministry mandarins, pressuring the RBI comes easier than raising resources through privatisation or expenditure reforms. Air India’s timid disinvestment plan has failed, as was expected. Its debt is burning holes in government finances. Would plugging those with the RBI’s surpluses serve ‘public interest’? This is political convenience masquerading as public interest.
•The RBI is being blamed for the NPAs crisis — though at the height of public outrage over the Nirav Modi scam, the government dragged its feet on filling the vacancy of the Deputy Governor in charge of bank supervision and inspections. Mr. Patel was of the view that after decades of relying on public-sector banking background profiles, the job should be opened to a wider, global field of expertise. The panel that shortlisted candidates for approval by the ACC concurred with his opinion. Overcoming the IAS lobby’s resistance, applicants who combined exposure to public-sector banking system with experience at prestigious global banks were included in the shortlist.
•But the ACC headed by the Prime Minister returned the shortlist, with a demand for more names, forcing re-advertisement of the vacancy and restarting of the process afresh. The previous Deputy Governor had retired in mid-2017. The successor was appointed in June 2018. The position remained vacant for nearly 12 months.
•Such impasses accrue when differences, whether of policy or appointments, are framed as a contest for supremacy, limiting space for serious discussion. Feuds are spun in popular discourse as ideological conflicts of homegrown versus ‘imported’ economists. But for the first time, number of IAS officers holding PhDs in economics were shunted out of the Ministry.
•Ila Patnaik, Arvind Panagariya and Arvind Subramanian left government. Raghuram Rajan’s messily-handled departure was followed by the sacking of a member, Nachiket Mor, from the RBI’s central board, another first for the RBI. When the government places low premium on qualified economists, non-technical actors and busybodies are able to muddy the waters and set the agenda.
In the public interest
•The Section 7 process has been initiated in issues that were settled in the past without so much bad blood. The government has overreacted and exhibited poor timing. Public interest is hardly served by the initiation at a time of mounting macroeconomic stress. The RBI is a systemically vital institution that, barring its meek acquiescence on demonetisation, commands the confidence of the markets and the public’s respect. What it does not have in good measure is the government’s trust and support.
📰 The ozone hole is recovering
•A recent study by NASA has confirmed the recovery of the ozone layer due to the absence of chlorine from Chlorofluorocarbon(CFC) in the atmosphere. The study published in Geophysical Research Letters journal has confirmed the phenomenon by mapping the chemical composition of the atmosphere. The study revealed that chlorine levels declined by 0.8% each year between 2005 and 2016 and speculates that it could be the effect of the worldwide ban on the use of CFC. Previous research had hinted atthe decrease in the depletion of ozone layer. Scientists believe that the ozone layer would fully recover by 2080.
