📰 China’s LAC aggression, India’s obfuscation
There are important reasons for the government’s confusing claims, political grandstanding and blurring of facts
•For a political party that never misses out on even a remote opportunity to indulge in aggressive military talk, the Bharatiya Janata Party and the government led by it seem to be sending out confusing signals about the ongoing India-China stand-off on the Line of Actual Control (LAC). Media reports about the Chinese aggression started trickling in from April this year, and yet there continues to be little clarity even today either in the country’s strategic community or the general public on the exact nature of developments on the China-India border. Did the Chinese soldiers indeed cross the LAC and capture Indian territory? Is the People’s Liberation Army (PLA) currently in possession of Indian territory? What exactly are the two sides talking about in their discussions pertaining to ‘disengagement’? How does New Delhi plan to retake lost territory?
Unanswered questions
•While the Prime Minister had claimed on June 20 that “neither has anyone intruded into the Indian territory nor has anyone captured any military posts”, the Ministry of External Affairs’ press note of June 17 had said that “the Chinese side sought to erect a structure in Galwan valley on our side of the LAC”. Adding to this confusion, India’s Foreign Secretary Harsh Shringla said as recently as in early September that it “cannot be business as usual” with China until the status quo is restored on the disputed border. One thing that emerges from these and other contradictory statements is that something is not adding up vis-à-vis the government’s claims about the LAC. Basic questions continue to remain unanswered.
Soft steps, domestic politics
•What is also becoming clear is that the government is seeking soft measures in stitching together a response to China. The government’s approach, as the External Affairs Minister stated the other day, is that “a solution to the situation has to be found in the domain of diplomacy”. Put differently, the BJP government has, on the one hand, decided not to reveal the exact nature of the situation on the LAC and, on the other hand, is attempting to negotiate Chinese withdrawal from Indian territory rather than using kinetic means or tit-for-tat measures to reclaim its territory.
•The BJP government’s inability to take a factual and unambiguous position on the LAC flows directly from its domestic political calculations. Acknowledging Chinese possession of Indian territory is bad optics for a party whose hardcore supporters revel in the military bravado of the party. Objective facts about adverse territorial possession matter, but not to everyone. In BJP strongholds in the Hindi heartland, upbeat from the inauguration of the Ram temple and the Article 370 ‘victory’, what essentially matters is ‘feel good’ optics and high-pitched rhetoric about a strong and unrelenting national leadership; not factual, actual positions on the ground regarding India’s national interest.
•Therefore, even if the BJP’s critics, some ‘pestering’ quarters in the media, and the Opposition cry foul about the government’s handling of Chinese aggression on the LAC, it would hardly make any political difference to the party. The BJP is simply not bothered about how it is perceived other than among its core support base. More so, its rather bold policies in Kashmir and towards Pakistan over the years have created sufficient political cushion to absorb a few misadventures or pushbacks, even if they were to become public knowledge. Obfuscation of facts or confusing signals about the LAC stand-off, therefore, serve an important purpose.
Two-and-a-half front situation
•Yet another reason why there is a deliberate attempt to refrain from disclosing full facts of the Chinese action on the LAC to the public is also the recognition within the establishment about the reality of a “two-and-a-half front situation”. Not that the Indian military and political leadership have not spoken about it before; but it is far easier to talk about fighting a two-and-a-half front war than actually fighting, and winning, it.
•Today, we are literally facing a “two-and-a-half front situation” — a restive Kashmir, an aggressive China and a Pakistan that never misses an opportunity to get at India — together forming a formidable national security challenge. While Pakistan’s interference in Kashmir is too well-known to be mentioned here, China may have emerged as a third key player in the Kashmir conflict. This has diplomatically emboldened Pakistan, and it would be unwise for us to rule out more China-Pakistan military and diplomatic coordination against Indian interests in the years ahead. Not that the two had not collaborated before, but this might see an increase in the days ahead.
•New Delhi’s strategists may have read this situation correctly. If so, it makes perfect sense for the political masters to underplay its gravity and seek a diplomatic solution to address the most dangerous piece in the “two-and-a-half front situation” — i.e. Chinese aggression on the LAC. In doing so, a confusing narrative is certainly helpful for domestic signalling.
West’s support is limited
•India’s inability to clearly articulate, identify and address the Chinese threat is also a function of another sobering realisation within the establishment regarding the limited utility when it comes to Euro-American assistance in checking China in South Asia. In an international system that is preoccupied with the domestic political, economic and public health worries of COVID-19, there is little enthusiasm to resolutely stand by India in pushing back China. The unpredictability of U.S. President Donald Trump adds to Indian woes, and until a new President is sworn in in January 2021, Washington DC’s ability to make up its mind and act on it vis-à-vis China-India affairs would be limited. New Delhi does recognise this lukewarm global mood, and so does Beijing. Picking a fight with China, therefore, is not the wisest strategy; obfuscating the exact nature of the China threat is indeed a much better strategy. In democracies, sometimes partisan political interests trump national interests, and a deeply divided political landscape accentuates such partisan considerations.
•The BJP’s diplomatic approach to deal with China’s aggressive land grab also stems from a capacity deficit. While a bean counting of the Chinese and Indian military capabilities might lead us to believe that we are not militarily far inferior to China, what might offset this consideration is China’s growing capabilities in domains such as cyber and space. While India’s naval capabilities may be stronger in the Indian Ocean, growing Chinese naval capabilities and its increasing reach in the wider region around India are also likely to dampen India’s enthusiasm about the Euro-Atlantic focus on the Indo-Pacific and the Quad (or the Quadrilateral Security Dialogue, which is an informal strategic dialogue between the U.S., India, Japan, and Australia) as tools to check China in the maritime space.
•If India is serious about checking China’s maritime influence in the region, it would need to invest in more resources to improve its naval capabilities. But where will the money come from? The combined effect of a pre-existing economic slowdown and the impact of COVID-19 on the economy means that the government would struggle to meet its basic expenditure needs for the foreseeable future. Defence expenditure is bound to take a back seat, and the China threat is unlikely to make a difference.
A dissonance
•The BJP-led government’s confusing claims, political grandstanding and obfuscation of facts have also led to a great deal of elite dissonance within the Indian strategic community on how to address and deal with the China threat. In times of major crises, nations normally stand together and speak in unison, but the LAC crisis does not seem to have brought the country’s political and strategic elites together unlike say during the Kargil crisis or the Mumbai terror attacks. The BJP’s confusing claims, intended to obfuscate the real nature of the threat, have in many ways led to this elite dissonance. This could have lasting implications for the country including for putting in place coordinated institutional responses to external challenges. No useful theory of victory can be born out of political denials about strategic challenges.
A focus on India’s youth is the first step towards self-reliance
•On Independence Day, the Prime Minister belaboured his government’s leitmotif of an ‘Atmanirbhar Bharat’. In today’s India, we can achieve that goal of self-reliance only if we enhance our citizens’ capabilities. Given our demographic composition, we must begin by empowering our youth.
Are we investing in our youth?
•The 2014 National Youth Policy (NYP) defined youth as persons between 15 and 29 years. This cohort accounted for 27.5% of the population then. According to the NYP report, the Central government spends about Rs. 2,710 per youth on education, skill development, employment, healthcare and food subsidies. The total amount is pegged at more than Rs. 90,000 crore. Assuming that States spend an equal amount, the total investment in our youth would be under 1% of the GDP, hardly commensurate with their population and potential.
•A World Bank report pegged the projected cost (read: loss) of not investing in children and youth at 4% of the GDP every year. Of this, the costs of unemployment account for 0.6%. As of 2017-18, youth participation in India’s labour force was 38.3%. Drawing from the 2018 State of Working India Report, we peg the youth unemployment rate to be at least 18.3% (3.47 crore youths). About 30% of youth fall under the ‘neither in employment nor in education’ category and 33% of India’s skilled youth are unemployed. Further, around 50 lakh youth are expected to be entering the workforce annually. Following the COVID-19 lockdown, the CMIE estimated a loss of 14 crore jobs in April alone of which 2.7 crore concerned youth. These numbers, coupled with impending grim implications of the pandemic, have landed us in uncharted turbulent economic waters.
The way forward
•The aspirational younger generation born after 1991 invariably hold the key to India’s economic and political future. India has just a decade’s time to seize the opportunity and realise this youth demographic dividend. Therefore, it is an appropriate time to launch an Indian Youth Guarantee (IYG) programme, akin to the European Union Youth Guarantee (EU-YG) but tuned to our country’s context. EU-YG emerged in 2010 at a time when youth unemployment rates were soaring above 20%. An IYG initiative, with statutory backing, can function as a facilitatory framework for ensuring gainful and productive engagement of youth.
•At a time of fiscal stress, one way to allocate budgetary resources would be to create a Youth Component Plan, earmarking a specific percentage of funds under a separate head on the lines of the Special Component Plan for the Scheduled Castes and the Tribal Sub-Plan. The Youth Component Plan would be formulated by States/Union Territories/Central Ministries to channelise flow of outlays and benefits proportional to the percentage of youth population based on sub-regional requirements.
•IYG should not be just another budgetary scheme. Its strategic goal should be to ensure that within a fixed time frame, young people graduating from college or losing a job either find a good quality job suited to their education and experience or acquire skills required to find a job through an apprenticeship. An important aspect of IYG should be to rope in the district administration and local bodies for effective outcomes. Existing youth schemes and skilling infrastructure need to be dovetailed and streamlined while leveraging industry to enable an in situ empowerment of youth.
Learning from MGNREGA
•The Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) has been very effective in providing rural livelihood security and social protection. Yet only about 4% of youth in the labour force have been impacted by it. While an urban youth employment programme will be a new intervention, we believe that rural youth employment should be instituted alongside MGNREGA. IYG needs to be implemented across the country to address youth unemployment particularly given the rapid structural changes in the economy.
•How would such a guarantee identify the needs of the youth? The Youth Development Index (YDI) in India serves as an advisory and monitory tool for youth development. It helps recognise priority areas, gaps and alternative approaches specific to each State. The index also packs a new dimension of social inclusion to assess the inclusiveness of societal progress due to prevalence of systemic inequalities. In short, YDI can be revisited and deployed to play a vital role in crafting a region-specific IYG. A focus on our youth is the first step towards self-reliance. It is time we summon the political will to guarantee our youth a viable future.
📰 The search for an end to the complex Naga conflict
The Centre must note that most armed insurgencies find resolution in a grey zone called ‘compromise’
•Despite having huge strategic significance, India’s northeastern frontier has largely remained marginal in the country’s popular imagination as well as mainstream politics. The region has witnessed multiple crises including bloody insurgencies, but still lacks the emotional resonance of the Kashmir conflict due to geographical, cultural, and ethnic factors.
•Rooted in the politics of sub-nationalism, complexities of regional geopolitics and the evolving dynamics of counterinsurgency tactics, the Naga insurgency has defied a lasting solution; it is an extraordinarily complicated conflict whose management has involved a mix of violent response and bargaining.
•The absence of R.N. Ravi, the Nagaland Governor and the Centre’s interlocutor for Naga peace talks, in the recently-held meeting of the Naga peace process in New Delhi and the subsequent involvement of the Intelligence Bureau to carry the talks further only testifies the intractable nature of the conflict. But it is not negotiating table alone where various issues pertaining to the Naga problem are being discussed and addressed. The politics of its ‘resolution’ is taking place at multiple sites.
‘Ceasefires’ and factions
•The Naga insurgency has come a long way, and so has the politics to contain it. In the early phase, the Naga insurgents were provided with what has come to be known as ‘safe haven’ in Myanmar. India’s adversaries (China and Pakistan) also provided them with vital external support at one point of time. A major accommodative tactic in the form of statehood to Nagaland in 1963 was not successful. Thereafter, the constant pressure from security forces coerced the Naga National Council (NNC) to sign the Shillong Accord of 1975, whose offspring was the National Socialist Council of Nagalim (NSCN). When the NSCN split into several factions, the Centre responded with entering into peace negotiations with almost each of them. But the undesirable outcome of these ‘ceasefires’ has been the creation and existence of unspoken ‘spheres of influence’. It is these spheres that have come under increasing scrutiny and attack from the Centre through the Nagaland Governor.
•The Modi government and the National Socialist Council of Nagalim (Isak-Muivah), or the NSCN-IM, the most powerful of the Naga insurgent groups which has been in peace talks with the Centre since the 1997 ceasefire, had signed a framework agreement in August 2015 which was claimed a historic achievement at that time. But a final accord has remained elusive since. When the Centre realised that privileging one insurgent group could eventually distort the contours of the final peace accord, it subsequently enlarged the peace process by roping in seven other Naga insurgent groups under the umbrella of Naga National Political Groups (NNPG). But another important group, the NSCN- Khaplang, whose cadres are reported to be inside Myanmar, is still outside the formal process.
Culture of extortion
•Given this complex backdrop, Mr. Ravi’s recent letter to Nagaland’s Chief Minister Neiphu Rio seems to have opened a Pandora’s box. In his widely-circulated letter, Mr. Ravi had expressed his anguish over the culture of extortion and the collapse of general law and order situation in Nagaland, where organised armed gangs run their own parallel ‘tax collection’ regimes. Extortions in the name of taxes have been a thorny facet of the Naga issue. The ‘taxes’ levied by insurgent groups are so intricately intertwined in almost all developmental activities in Nagaland that any serious discussion of the issue has been conveniently avoided. One of the major aims of the NSCN-IM has been to acquire formal recognition to this informal practice through negotiations.
•As the Governor has crossed the proverbial Rubicon, the NSCN-IM cannot be happy for the simple reason that it is loath to being branded as an ‘armed gang’ and is vehemently opposed to the treatment of the Naga issue as a ‘law and order’ problem. Offended by military actions initiated against its cadres in recent months, the NSCN-IM is equally unnerved over a recent directive by the Nagaland government asking its employees to self-declare the membership of any of their close relatives with underground groups.
Unease over interpretations
•There has already been much debate and controversy about the interpretation of ‘sovereignty’, as reflected in the latest “Naga Independence Day” speech by NSCN-IM chief Thuingaleng Muivah. Demand for a separate flag and a ‘constitution’ has been a key hindrance in building trust among the parties. Some Indian States contiguous to Nagaland have been affected through the mobilisation of the Naga population in these States. That is why they are apprehensive of the demand for ‘Greater Nagalim’, which would imply a ceding of their Naga-inhabited territories. Another significant issue is how the weapons in the NSCN-IM camps are going to be managed. As a ‘ceasefire’ group, its cadres are supposed to retain their weapons inside the designated camps for self-defence only, but more often than not, many influential cadres are seen moving with weapons in civilian localities, leading to many problems. It would be an uphill task for the Centre to ensure that all weapons are surrendered at the time of the final accord.
The last word
•The NSCN-IM has demanded the removal of Mr. Ravi as the Centre’s interlocutor in the peace process, asking for affirmation of the 2015 framework agreement as being “alive in its original form”. What has further widened the trust deficit is the allegation by the NSCN-IM that the interlocutor has subtly manipulated the framework agreement. Was it a case of over-promise and under delivery on the part of Mr. Ravi? Nevertheless, the Centre must keep in mind that most of the armed insurgencies across the world do not end in either total victory or comprehensive defeat, but in a grey zone called ‘compromise’. It has become even more urgent in view of China’s unusually aggressive behaviour in Ladakh. One need not forget that some high-profile NSCN-IM commanders are reported to have fled last year to China’s Yunnan province to seek Beijing’s support.
📰 Reviving the economy
The first step is to acknowledge that an issue exists
•Such has been the great fall of the Indian economy that the issue is as lamentable on the surface as it is a few data points deeper. The analysis of the quarterly GDP number for Q1 2020-21 needs to be fair and balanced. Though no magic could have brought encouraging results, the performance has been way below anyone’s expectations. The numbers for Q1 will be even lower in reality as they don’t account for the informal sector, the hardest hit.
Four key indicators
•For coming up with an approach to resolve an issue, the first step is to acknowledge that an issue exists. Living in denial might delay the realisation but not the outcome. I am afraid that is precisely what’s happening right now. The signs of economic paralysis were evident for the last 18 months or more. The quarterly GDP growth numbers had been falling for the last nine quarters, barring Q4 of 2018-19. Out of many, four key indicators have had me worried for the last 18 months. First, the Gross Fixed Capital Formation (as % of GDP) had been on a constant decline (except in 2018) between 2014 and 2019, falling from 30.1% to 27.4%. Developing countries generally invest heavily in fixed assets to increase aggregate demand and prepare capacities to meet future demands. Second, consumer demand in urban India. Exactly a year ago, domestic car sales were on a steady decline for nine consecutive months with a 41.09% decline in sales in August 2019. Even commercial vehicle sales were down by 39% indicating a fall in industrial activity. Third, weak FMCG demand in the rural economy. Data from India Ratings indicated that average real rural wage growth dropped from 11.18 % in FY13-FY15 to just 0.45 % in FY16-FY18. No wonder consumer confidence was badly hit, leading to sluggish demand. Last, the eight core sectors registered a growth of -0.2% in August 2019, indicating that there was not only an issue with the demand but also with our preparedness for supply.
•At a time when there should have been an acknowledgement of the problem at hand and a plan for resolution and revival, there was a game of musical chairs going on, except no one wanted to take the chair of blame. Eventually, urban millennials were blamed for low passenger vehicle sales as they now prefer app-based taxis to owning cars. Good box-office collections were cited as a proof of a healthy economy. Earlier, Jawaharlal Nehru was to blame for the economy, now it is said to be an “act of God”. No one admits that it was the botched-up policymaking and implementation of Modi 1.0 and Modi 2.0 that has led to all of this.
•Before we even start with the recommendations, let’s analyse where we stand at the moment. The investment appetite of urban households is low, urban consumption is low. There is contraction in the eight core sectors indicating that even if demand picks up, we are not well placed to meet those demands. The only saving grace is the rural economy. Rural demand has been better than urban demand thanks to a surplus monsoon and a higher disposable income through MGNREGA wages.
The way forward
•Policymaking and implementation around three things need to be given a long, hard thought. First, the urban economy has to get running. Investments need to go up and this has to be driven by private and household investments since the contribution in capital formation by the government and the public sector is only 24%. So, government spending alone won’t help. Creating more jobs is the need of the hour. Second, the rural growth model needs to be sustainable. Increasing disposable income may work in the short term but it would be more sustainable to increase job opportunities at the rural level and strengthen MGNREGA. Third, there needs to be a massive push on infrastructural spending to boost the core sector demand and generate jobs. Extending MGNREGA to cities and towns will also attract migrant workers to move to the cities again. Last, with a focus on demand generation, supply issues need to be sorted. The eight core sectors that have shown contraction would need structural reforms to bring them back on track.
