Who is Really Running India? - the question western governments can't be bothered to ask

Jack Barton

Tweet

The Naxalites control vast swathes of central India. platypus1917.org

It does not take a great political mind to know that western governments are falling over themselves to get closer to India, nor does it take one to realise why.  Of the four BRIC nations it is the one which appears to offer the most from a closer friendship - strategically positioned between the volatile Middle East and the threatening China, the West believes that they have something to offer India in return for their friendship, unlike with some of the other emerging powers.  As I have pointed out in previous posts, India does all it can and more to encourage this impression so that western governments continue to invest, building stronger economic ties while overlooking those who suffer at the hands of Indian economic policy.  This attitude is not just mercenary and self-promoting, it is woefully lazy foreign policy.  We are investing as much as we can into a country so detached from our own and growing at such a fast pace that we cannot be bothered to address the most important question and more importantly the political fallout from its answer - who is really in control in India?

The most obvious answer is the one governments tend to work with when dictating foreign policy - Prime Minister Manmohan Singh and the Indian government.  Leaving aside for a moment the criticisms levelled against Singh in recent years and the fact that he is attempting to hold together a coalition government, alternative groupings both old and new hold such power that they could make policy-making for even the strongest government an uphill struggle.

General V K Singh recently took the government to court - the Indian Express all but accused him of threatening to coup

Indian news has recently been dominated by a dispute between the government and the army.  Army Chief General V K Singh has in recent weeks taken the government to court over a disagreement about his date of birth, claimed in a leaked letter that 97% of India's military is useless due to lack of supplies and according to some reports threatened to seize power in Delhi.  The last of these is obviously the most significant; the Indian Express newspaper claimed that two army units, including a special forces battalion had marched on Delhi without the government's knowledge.  General Singh and the government have both denied the claims but the reaction from commentators across the country reveals a great deal about how real this threat could be.  The Indian Express stands by its report and from the perspective of the general public there is little reason to believe the government who routinely suppresses or misleads the media.  Whatever the truth, the Indian military is clearly not as reliable an arm of the government machine as Western powers would like to assume.

In February Indian police arrested 47 villagers for protesting against the building of a toxic dump near their village. intercontinental

Another power-base completely outside the Indian government's control yet ignored by the West lies in the handful of enormously wealthy corporations that reach into every aspect of Indian life.  Based in their control of vast natural resources and investment in the booming technology sector, these corporations have created an elite of incredibly rich and influential men.  Their power is not only clear through their control of the retail market and the media but by the fact that they can quite clearly do whatever they want with the resources India's exports rely upon.  In 2006 police fired upon people protesting against the construction of a boundary wall by Tata Steel, in recent years tens of thousands of rural people have been displaced by these corporations with the consent of the Indian Government.

Which brings me onto another aspect of the Indian population that undermines the power of the Indian government simply by its existence - the dispossessed, the disenfranchised and the disillusioned.  At the extreme end of the Indian population, the government's attitude towards its rural poor has been so inflammatory that it has created an insurrection in the forests of central India, which has grown in momentum in the past decade to the point of what some commentators are calling civil war.  Labelled 'maoists' and 'terrorists' by the government, this guerrilla army numbers tens of thousands of fighters (estimates peak at 120,000) who regularly attack military and police targets.  At the less extreme end of the spectrum, a campaign to have 'none of the above' as an option on election ballots has been equally persistent.  Apart from the treatment of the rural (and urban) poor, corruption scandals, failing education, a lack of medical care and persistent poverty have created mass disillusionment among all Indian classes - the government's position in dictating policy grows weaker as its basis of support simply vanishes.

I have not even mentioned the social, ethnic and religious factionalism that divides the Indian population.  But in barely scratching the surface of the competing powers that undermine the Indian government, it becomes obvious that the question of ruling India is not as simple as Western leaders like to assume.  When Obama smiles benignly down and gives the Indian government a pat on the head for reaching out to Pakistan, when Russia leases them nuclear submarines, it simply looks like good foreign policy.  They must know though that the Indian government exists because there is no united opposition, that Manmohan Singh is in every way a figurehead.  If we insist on hoping to gain from a tighter friendship with India it is surely worth doing it properly, asking the questions rather than relying on assumptions.

The ‘Foreign Hand’ – Manmohan Singh takes us back to the Cold War

Jack Barton

Tweet

Protesters at the Kudankulam power plant. Downtoearth.

Indian Prime Minister Manmohan Singh invited another round of criticisms on himself in February over remarks he made to the journal Science blaming the setbacks faced by India’s nuclear energy programme on foreign NGOs.  Suggesting that these NGOs, based in the US and Scandinavia, were funding the protests that have stalled the building of a nuclear power station in Tamil Nadu, Singh has been widely criticised from politicians and activists at home and commentators abroad.

Foreign observers have been quick to make the comparison with former Prime Minister Indira Ghandi who routinely blamed the problems faced by her administration on the influence of the ‘foreign hand’ – sometimes specifically citing the CIA.

It is difficult to say what is most remarkable about Singh’s statement; that it veers sharply from his usual foreign policy or that by all accounts it is completely unsubstantiated.  Much of the domestic furore came from the Indian campaign groups who have been fighting the proposed nuclear scheme.  Udayakumar, the coordinator of the People's Movement Against Nuclear Energy, claims that the records kept by the Ministry of Home Affairs show the suggestion that activists are backed by foreign NGOs is ‘a complete falsehood.’  V. Pushparayan, an activist from the Coastal People’s Federation, said that Singh was using ‘absurd allegations’ to divert peoples’ attention from the real issues.

This has been an interesting diversion from Singh’s usual foreign policy.  Critics have often referred to the Indian PM himself as the ‘foreign hand’ for his reliance on foreign investment for economic growth.  In the same interview Singh stated defensively ‘we are a democracy, we are not like China’; while it would be interesting to see how many of the population of the villages who will be displaced by the Kudankulam plant vote, this is technically true – and it is clearly the source of Singh’s problems.

India is a democracy, so when the government is pushing through unpopular growth schemes, Singh can’t possibly blame the protest on his electorate.  He has so far focused his blame on the media and his coalition partners, now the ‘foreign hand’ is causing further setbacks for the fledgling great power.

The nuclear energy scheme is another example of governmental policy putting growth above everything else.  All of the investment, all of the prestige India has gained under Singh’s tenure has been based on remarkable growth figures and tangible signs of modernisation.  Nuclear energy would be another symbol of modernisation and reliability (it would also lessen India’s reliance on oil from Iran) and as such the project will go ahead over the protests from environmental activists and the farmers and fishermen of the 17 villages that will be affected by the power station.  Officials from the International Atomic Energy Agency have been visiting the proposed site in secret.  The station will go ahead just as the mining and agricultural schemes on land sold by the Indian government to western corporations already have - projects which have displaced ten of thousands of villagers in collateral damage.

Critic Devinder Sharma has voiced much of the popular criticism against Singh: 'Whether it is GM crops or nuclear plants, the PM is more interested in the commercial interests of American and European companies. He is not concerned about the environmental and human impact of these risky and unwanted technologies on his people.'

Western NGOs have not been creating problems for the Indian government but it would almost be preferable if they had been.  A coalition of women, fishermen and farmers from 17 villages is protesting against a government scheme which will end their way of life, not only would a bit of help from a humanitarian organisation be justifiable from a moral perspective but the political implications could have been enormous.

The fact that Singh’s remarks were false has allowed the US and Scandinavian governments to ignore them.  Under the surface this has been an extremely telling episode in Indian foreign relations – it should have caused more of a stir, not only did Singh blame foreign funding but he condemned it, any governmental response to this would have had to have acknowledged that NGOs had every right to support India’s marginalised population, that it was the right thing to do and therefore that in ignoring these groups India was in the wrong.  Instead Western government have not deigned to respond, they have been allowed to ignore it in the same way they ignore all of the abuses carried out by their trading partner, in the way that allows Britain and France to compete to sell India arms – and will allow the US and Russia to compete to sell them nuclear reactors.

There is no question over whether a European government would be allowed to override the objections of its populace in this way without inviting criticism.  It is almost a given that growth in India is coming at this price, but it is a growth that Western governments are feeding and supporting, taking what they want from it and ignoring the consequences.  India is an ally and a trading partner, it relies on the West for its growth and yet the problems that result from this growth are not our problems, and for some reason they are not our responsibility.

Japan – a Forgotten Asian Partner

James Horrax

Tweet

Britain's Prime Minister David Cameron shakes hands with Japan's Prime Minister Naoto Kan before their bilateral meeting at the G8 summit on May 27, 2011 in Deauville, France. Pool/Getty Images Europe.

Over the last ten years, attention in Asia has been diverted to the emerging markets of China and India. With predictions that China will become the world’s largest economy between 2020 – 2025, and India the world’s largest democracy (for all it’s faults) in a region where its government is unusual to say the least, it is perhaps not unsurprising that British foreign and trade policy has developed around Asia’s giants. 

Further to the East however, lies an economy which is larger by GDP per capita than both India and China combined – the archipelago of Japan. 

Japan has been thrown into the shade by its own noisy neighbours in China and Korea in recent years – and it was only last year that China replaced Japan as the world’s second largest economy – but it still represents a key and important strategic relationship for Britain and the West over the coming years. 

Since the end of the Second World War, Japan has been a reliable ally for Britain and after Europe, China and the US, the UK has been Japan’s largest export market. However recently its economy - after a relatively successful period from 2000 – 2008 - has begun to struggle. Many will point to one-off mitigating factors including the powerful earthquake and tsunami which struck last March and the subsequent shut down of many nuclear reactors which as a result have helped push the costs of energy higher. But the truth is, Japan’s relative success in the early part of last decade was because of a boom in consumer consumption in its largest export markets – particularly in electronics, cars and financial services. 

Now there is a chance for Britain to return the favour. As was mentioned in my last post, David Cameron and the Coalition Government have made a big play of saying the world doesn’t owe Britain a living and the Japanese present economic malaise could be an opportunity. Despite Japan having a highly developed consumer culture, Britain can export plenty of services and expertise. Japan’s demographic time-bomb which is seeing an increasingly aging population, is increasing the need for pharmaceuticals and medicine which British firms like GlaxoSmithKline and AstraZeneca should be taking advantage of. The effective negative interest rates which Japan’s pension pots have been labouring under also makes financial services another sector where Britain can grow in Japan.

Following the earthquake and tsunami of 2011, David Cameron called on the European Union (EU) to offer a free trade deal to Japan to help recovery. While progress on this appears to have ground to a halt for now, for the benefit of all parties this deal should be resurrected and implemented as soon as possible. However there are some protectionist economic measures (specifically in the agricultural industry on both sides like the Common Agricultural Policy (CAP) and high import tariffs on products to Japan) which appear to be a sticking point. If the rich world is to grow its way out of its present economic funk, ensuring that tariffs and subsidies are removed will help government expenditure in the immediate term and eventually trickle through to the wider market, forcing costs for consumers down. It is only by increasing global trade and removing barriers to entry, that consumer driven economies like Britain and Japan can hope to get back to sustainable long term growth.

Still Japan is not just an economic strategic ally, it is also a regional and geo-strategic one too. As the situation in North Korea continues to unfurl, maintaining military and security intelligence cooperation in the area is vital and this is where Japan, along with South Korea will be of crucial importance. 

UK should be building close intelligence ties with Japan and South Korea in case of a North Korean collapse. Nautilus.

Japan’s relationship with North Korea, and its Chinese paymasters, is often fraught with historical and cultural tension. It is hardly surprising the US maintains a strong military presence on Okinawa given how Japan is a perfect vantage point with which to view the Far East peninsula. Historically, British ties have been less strong in this area, although with the continuing developments in the Middle East and the attention of strategists being held by Iran, it would be dangerous to assume this part of the world will simply sort itself out. As such, Britain should also focus on developing intelligence ties with Japan. This need not be costly but the consequences for failing to do so may be enormous. 

If North Korea is to collapse as reports suggest, Britain and its allies need as much information as possible, particularly since the most valuable assets North Korea will possess upon falling will be its nuclear materials which can be easily siphoned off and smuggled out of the country. While a rising China is unlikely to allow this to happen, their foreign policy is based on a laissez-faire principle of non-interference rather than liberal interventionism and nothing can be assured where projection of Chinese force is concerned.

Japan’s role, alongside its South Korean neighbours, will be of critical importance in the coming years. Britain must develop its ties accordingly. 

A Mercenary Attitude to the Indian Economy

Jack Barton

Tweet

India’s 1.13million strong military has long been criticised for underfunding and out of date equipment. Getty Images/Daniel Berehulak

At the end of January, after months of negotiations and sales pitches, the Indian ministry of defence indicated that it has chosen to buy 126 Rafale Fighter aircraft from the French firm Dessault rather than the Eurofighter Typhoon from BAE Systems and Italy’s Finmeccanica.

The decision has outraged many British politicians and commentators, drawing criticism of the Indian government from the right and the British government from the left.  David Cameron drew criticism by getting involved personally in attempting to change the Indian government’s mind.  Since it has been a clear aim from the start of his administration to garner closer ties with India, particularly in terms of trade, this must have left rather a sour taste.  Commentators have suggested that this is down to a fundamental misunderstanding of who holds real power in India; Cameron has worked hard to foster good relations with his Indian counterpart Manmohan Singh – underestimating the unofficial power still wielded by the Ghandi family who David Miliband was much closer to.

The reaction of Conservative MP Peter Bone (“What on earth do they know about cricket and curries”) sparked a much-read article by Labour MP and Guardian columnist Tristram Hunt.  The article highlights the dangerous effect of an attitude toward India “enveloped in the language of colonialism and entitlement” which threatens to forever undermine the relationship.

While I am more than happy to criticise David Cameron for attempting to cosy up to the Indian Government without attempting to understand the nuances of Indian politics or the very real danger of post-imperial arrogance, it is hard to believe that either of these things were really the problem.  India chose the Rafale over the Eurofighter Typhoon simply because it was cheaper.

India has the second-largest military in the world but the 10^th largest military budget, and this time last year the Indian government increased the defence budget by 11.6%.  Its enormous military machine is engaged in an overhaul it has been attempting to complete for almost half a century, spurred on by what is essentially an arms race with China.  For all of BAE’s assurances that the Typhoon is a better aircraft, the Indian air force already uses French planes and Dessault’s offer was lower.  Undoubtedly many factors went into India’s decision but it really should not be a surprise, and what’s more from India’s perspective it is hard to see it as a bad decision.

The Eurofighter Typhoon was widely tipped to win the contract by analysts. Reuters. 

Much of the criticism has been drawn from the fact that France gives no aid to India whereas Britain donates billions, the Sun has even called for an end to British aid to India.  Arms trade companies are at best in a murky ethical position on the whole, squabbling over a $10billion arms sale to a country where over 30% live below the poverty line is even more dubious.  But calling for aid to be reliant on their buying our weapons surely crosses a line.  BAE will not cease trading with India, they will keep trying to change their minds, they will keep selling them arms whenever they can.  Britain cannot cease giving aid to India, apart from the suggestion that this would be some kind of reprisal, the government has made it all too clear how much increasing trade would benefit us and how keen they are to gain tighter links with New Delhi.

There is a good chance that this deal will fall through – it has been suggested that Nicholas Sarkozy brought the price down temporarily to gain a political victory in an election year.  This would explain the British government’s indignation but highlights yet another unsavoury element of this affair.

The British government is just not in a position to complain about this and in doing so it risks revealing an incredibly mercenary attitude toward its dealings with its former colony.  In constantly trying to increase its financial and diplomatic stake in the developing country, our government forfeits its right to criticise India’s massive – and ever-increasing – defence spending despite their continuing to take (and so clearly need) aid money.  Furthermore what should oblige India to choose our more expensive option?  The British government’s stance has repeatedly demonstrated that they think that we are the ones that have everything to gain from this relationship, had the Indian government chosen the more expensive option they would have come under enormous criticism for wasting extra resources so badly needed elsewhere.

It is easy to attack the UK arms trade from a moral perspective and of course the fact that Dessault is likely to win the contract is hardly a result of the company’s altruistic aims towards cutting Indian defence spending.  It is necessary to take a step back though; the outrage displayed by our government is a PR disaster, bringing to light an incredibly mercenary attitude where aid is there to buy us favours and winning a defence contract with a poverty-stricken country is a political victory rather than economic expediency and at best a necessary evil.

India's Unsustainable Growth

Jack Barton

Tweet

David Cameron is met by Indian PM Manmohan Singh on July 28, 2010 - Photo by Daniel Berehulak/Getty Images AsiaPac zimbio

On 10th January the results of a survey were released revealing that in India 42% of children are malnourished and 60% stunted. While no-one would deny the utter tragedy of this, what is most surprising is that we are not surprised.

Over the past few years, something strange has been gradually developing in terms of our relationship with, and perception of India.  Depending on the context, when we think of India one of two very different countries comes to mind: there is India, the emerging great power with enviable economic growth statistics, and there is India, of grinding poverty, slums and social injustice.

PM Manmohan Singh with Ethiopian counterpart Meles Zenawi NetIIndian

The effect of this double vision is remarkable, it allows us to accept that India is a nuclear state with the second largest military in the world and to approve of the British cabinet’s 2010 trade visit there as simply smart foreign policy – building trade and diplomatic ties with a rapidly growing power.  We can accept the results of a study by Oxford University which found more people in poverty in 8 states of India than in all of the 26 countries of sub-Saharan Africa combined, yet it seemed unremarkable that Indian Prime Minister Manmohan Singh pledged $5billion in aid to Africa last year.

The reason behind this paradox is not complicated: every move made by the Indian government in internal and foreign affairs is done to promote its international image and attract investment from governments like our own.

If you walk through a city like Bangalore, the centre of India’s IT boom, examples of this policy are abundant.  City workers cover pollution with brick-red paint while black and yellow hazard stripes on the road below fade to nothing; everyday life is disrupted by the well-publicised building of a metro, unlikely ever to be finished, while underneath the rails shelter hundreds of beggars and crippled workers, ignored by city authorities.

The supposed justification for this horrific misuse of money is that the government is playing a long game – attracting investment will eventually make life better for India’s huddled masses.  This carries the assumption that the atrocious human cost of growth is worthwhile – something which the overwhelming majority of Indian citizens patently do not agree with.  Take for example the development of large-scale agriculture and selling of the rights to enormous amounts of the country’s natural resources to external corporations.  While such measures contribute to India’s modernization and accelerated GDP, they have destroyed rural communities and misplaced tens of thousands of people.  Small-scale farms have suffered so much that is was recently estimated that a farmer commits suicide in India on average every thirty minutes.

This aspect of government policy has led to a huge growth in support for groups such as the Naxalites, a Maoist guerilla group which fights for the rights of the rural poor.  While it has existed since the 1960s, its numbers have grown enormously over the last decade with estimates ranging from 70,000 to 120,000 fighters.

Support for the current government in the mainstream of the population has been flagging for years now and it is clear that the majority of the Indian population disagrees with its misuse of their money.  Apart from the economic argument that India’s current rate of growth is unsustainable, this unrest surely puts in doubt the likelihood that the country will continue to seem a fruitful investment.  Whatever politicians believe, this is not a long game at all – it is short-term politics and egos.  It is a sobering fact though that the Indian government will continue to ignore all forms of opposition to this policy as long as it continues to garner them external investment – essentially it will ignore the problem as long as we do.

Cameron inspects the troops at the official residence of the Indian prime minister, Manmohan Singh, in Delhi. Daniel Berehulak/Getty Images Guardian

It is the job of governments like our own therefore to acknowledge the other India and in doing, force their government to do the same.  Investment must rely on stability, take the potential for further economic growth as a given and insist that their partnership relies on a real settling of their internal issues.

Perhaps it is a form of post-imperial guilt that makes us hope and therefore believe that Indian economic development is making poverty there a thing of the past, perhaps we are happy to believe in the image the Indian government has constructed for itself because we are so desperate not to be left behind by the rise of the East.  It will be governments like our own which will be condemned by history for feeding the modernisation of India and forcing the development which is leaving millions of people behind.

China: A Threat or an Opportunity?

James Horrax

Tweet

Cameron and his cabinet ministers toast with China’s Premier Wen Jiabao, at the Great Hall of the People in Beijing in November 2010. Photo: Wallstreet Journal

Since the Coalition was formed in May 2010, senior Cabinet members including the Prime Minister, David Cameron and the Chancellor, George Osborne have conducted ‘trade missions’ across the developing world. 

As if to demonstrate the importance of these missions, the trip to China took place within the first six months of this Parliament – it was attended by the largest ever British delegation to Beijing in 200 years. 

Obviously countries across the world maintain and develop bilateral relationships all the time, but this delegation was significant because publicly and unashamedly, the Government was putting its trading relations with the world’s second largest and one of its fastest growing economies at the centre of its economic and foreign policy. 

At first the trade mission was scoffed at as an inflated vanity trip – in fact on his trip to China in November 2010, David Cameron was left red-faced by the fact that in the previous week, Nicolas Sarkozy, the French President, had secured €15bn worth of trade deals from the Chinese. The biggest piece of business facilitated by the Prime Minister was a deal worth £740m for Rolls Royce to supply and service engines for a Chinese airline. Although he did make plainly clear his intention to nearly double the trade conducted between the two countries within five years from a present £32bn per year to £62bn per year by 2015.

British Company Rolls Royce secured a contract with Air China Business Today 

China’s economy, as we are reminded on a near daily basis, is growing rapidly – albeit from a low base. It would be easy to provide datasets but this graph shows just how sharply China’s economy has grown, particularly over the last 10 years. It’s growth over that period of time, has been as a consequence of a booming export market – helped by the under-valuation of the yuan and historically high levels of Western consumption – and while it’s imports grew over the same period, a large portion of these were commodities, like oil, coal and metal ores to feed its manufacturing industries and its subsequent exports. 

In 2001, according to the World Bank GDP per capita was $1,042. In 2010 it was $4,428. The Chinese are getting richer, as a nation and individually. This means an expanding pool of consumers for Western products and services and Britain should take the opportunity to exploit this. This makes the British government’s decision to recalibrate the economy away from financial services important – as David Cameron said, Britain must start earning its way in the world again and targeting export markets which are growing, like China, is part of that strategy. Obviously London’s position as the world’s premier foreign exchange hub means that the UK is well positioned to take advantage of China’s currency requirements over the coming years as well. 

Chinese Yuan global importance is growing Photo: Reuters Guardian

But in other areas, Britain must step up to the plate – whether that be in IT, green and renewable energy or high-end manufacturing – these will service the growing demands of a country where fuelling growth is a key concern and where despite many advances, vast swathes of the country are still relatively impoverished. Another area the UK should be able to export in is the services sector. Despite a steady, if unspectacular growth in the service sector, this element of China’s economy remains underdeveloped and immature. British service and consumer facing brands may help to bring about a much needed kick to recalibrate China’s economy, which till now has relied on its exports, to satisfying domestic demand.

So all upside for Britain then? Not quite. In order for the UK and the West to benefit from a booming China in the areas I outline above, whether that be services, IT, high-end manufacturing or green and renewable energies, Britain and its allies needs to press China on intellectual property to ensure that a burgeoning market is not shuttered by copyright infringement and intellectual theft. While China remains a hothouse of manufacturing, it lags behind in idea generation and specialises in producing ersatz goods.

Another consequence of China’s growth over the last few years has been its increasing global ambitions and interests. In its thirst for natural resources, a desire to help create the conditions for favourable export markets and to develop international support, China’s foreign policy in Africa has encouraged the entrenchment of corrupt and in some instances despotic governance. As the call for democracy currently ringing around the Maghreb and the Muslim world intensifies, it might only be a matter of time before China’s interests diverge from that of the local people. While Sino-investment in infrastructure and industry is welcome now, it is not unimaginable that a power shift could throw this delicate quid pro quo arrangement out of kilter. The rise of a series of failed states across Africa raises the ugly prospect of Western and British security threats as much as humanitarian disaster – the UK, along with allies, needs to ensure that China is accountable for any fall-out in this sphere.

And this is before any mention of a political challenge emerging to threaten the Communist leadership in Beijing. Conventional wisdom has it that as a society enriches itself nationally and at an individual level, greater demands for property protection and political rights will occur as well. While it is difficult to know precisely just how much tension exists below the surface, instances of unrest in Xinjiang, the continuing difficulties in Tibet and reports of potential collapse of its tearaway satellite North Korea mean that China’s path from regional power to global superpower is littered with potentially destabilising events for trade and commerce. 

Britain must make sure that while it utilises the many financial opportunities China’s growth presents, it does not sacrifice its principles either.