Some countries are naturally at ease with the concept and the reality of strategic power. Such was clearly the case of France under Louis XIV, the Sun King in the seventeenth century, and such is the case today of China, whose leadership is comfortable with the balance-of-power games of classical Europe.
India is clearly in a different category. In economic terms, India’s confidence has been boosted by the way the Western world now looks at it with a mixture of respect and greed: “What kind of deals can I strike with such an emerging market, whose population will soon be the largest of any country in the world?”
Yet, in order to understand India’s political and diplomatic relationship with the outside world, the most enlightening comparison is with America in 1920. Like the United States after World War I, India is realizing that its status and role in the world have been deeply transformed in the last two decades. And, like America then, India is not naturally at ease with the notion of exercising global power.
India’s history and culture, from Asoka, its mythical emperor in the third century BC, to Gandhi, push it to emphasize ethics and to consider itself an “exceptional” nation in its relationship with the world. Contrary to China, India finds it difficult to adapt to its status as an emerging “Great Power.” It would be a gross exaggeration, of course, to speak of an Indian “inferiority complex.” And yet India constantly measures itself against China, remains obsessed with Pakistan, and has recently begun to look more critically at its relationship with the US.
It is natural for India to proclaim its “democratic” superiority to China while recognizing that on all strategic fronts it is not in the same league. But is it even possible to draw a comparison between what one Indian academic has called the “robotized Chinese man” and the vast human diversity of India?
India seems to worry more than ever about China’s evolution. China’s key role within the G-20, together with the relative if not absolute decline of the Western powers, seems to have reinforced the hard-liners in Beijing and the nationalism of a China that seems less ready than ever to accept any criticism of its human rights record. Viewed from New Delhi, the vision of a reasonable, prudent, and ultimately satisfied China – a vision “sold” to the world by the Minister Mentor of Singapore Lee Kuan Yew – appears less than obvious.
When it comes to Pakistan, too, India seems to lack confidence. On all fronts – demographic, economic, military, and political – India is far above Pakistan. But India does not seem to know how to deal with its northwestern neighbor, and even less whom to deal with in its government.
The largest democracy in the world cannot say openly that it almost preferred the military dictatorship of General Pervez Musharraf to the chaos of the current situation. In reality, what prevails in India is a deep sense of frustration with Pakistan. India’s overtures to Pakistan’s government have largely remained unanswered, and when Indian officials express their unease, the US, if not the international community, accuses them of behaving irresponsibly.
If India seems not to believe that America and its allies can really “succeed” in Afghanistan, nor is it willing to resign itself to a return of the Taliban to power, which could in turn lead to Talibanization of Pakistan. Yet India seems to behave in a very “European” way in Afghanistan; it is ready to send money and experts, but not troops.
India’s worries and frustrations in Afghanistan and Pakistan translate into a mixture of disillusion and irritation with an America that, seen from New Delhi, allows itself to be manipulated by Pakistani officials. Indians cannot quite decide whether the Americans are simply “naive” or duplicitous; either way, they are not reassured.
Whatever the case, the current warming of relations between India and Russia, symbolized by Prime Minister Vladimir Putin’s recent visit, does not translate into a grand reversal of alliances, as India’s break with Russia in the 1990’s did. India’s exchanges with Russia are only one-fifth of what they are with China. What prevails nowadays in New Delhi and Moscow is simple pragmatism.
While there is room for Europe in India’s view of the world, for India (as for China) Europe is above all an economic rather than a political reality. When it comes to politics, bilateral relations prevail, and from that standpoint France and Germany seem more important than Great Britain. The Raj era may be visible in the buildings of New Delhi and in the uniforms of the Indian army, but Britain has lost any competitive edge that it once had in India. The past is truly passed.
India’s unease about strategic power, and its resemblance to a gigantic European Union united only by the English language, reflects its ongoing search for a new international identity. In this quest, India is impaired by its lack of practice in the exercise of power on a grand scale. India is not about to become a second China – it lacks both the means and the ambition. That is a further reason for the West to engage and invest in India.
Tuesday, April 20, 2010
Friday, April 09, 2010
Afghanistan Woes
``Failed state'' is a term applied frequently to Afghanistan and is often deemed the cause for why terrorists gained such influence there. But a country does not fail of its own volition, nor is it weakened by unknown causes. A country fails, when it fails, for definite, identifiable reasons. These must be addressed if Afghanistan is to be revived.
Twenty years of invasion, civil war, and drought have left Afghanistan's institutions in ruin. Millions of Afghans huddle in refugee camps or are displaced from their homes. Land-mines defile the countryside. Millions are sick and poor; many live at starvation levels. For these and many other reasons, rebuilding Afghanistan's economy will require not only economic reconstruction but an effort to reinvent the country's political and cultural institutions. Such a massive effort will be doomed to failure, however, if Afghanistan's neighbors intervene in ways that promote economic upheaval all over again.
Afghanistan is no place for quick fixes. Rebuilding the country cannot be done cheaply. Any thought that the anti-terror coalition will be able to bail out fast (as the West did when it abandoned Afghanistan to its fate after the Soviet withdrawal ten years ago) should be forgotten. The West must stick with Afghanistan until its reconstruction is established. Otherwise, it runs the risk of renewed chaos and violence, but this time in a more destabilized region, as Pakistan's current problems demonstrate.
Three problems are of immediate concern, the most important being feeding the Afghan people - both within the country and in refugee camps outside Afghanistan. Humanitarian aid is being delivered, but a distribution system safe from the predations of Afghanistan's warlords needs to be built. Indeed, the warlords have been given too big a say in distributing aid already, and it may be hard to strip them of this power. But stripped they must be.
The second problem involves relocating Afghan refugees now living in Pakistan and Iran, as well as those displaced within Afghanistan. To achieve this goal, the agricultural economy must be revived in order to revive this industry, providing jobs and food for people. A massive impediment here is the millions of mines left over from the Soviet invasion that must be removed.
The West has a big incentive to be generous to Afghanistan's rural poor. Starving farmers, if unassisted, may return to cultivating a very reliable cash crop: the opium poppy, long a staple of the warlord economy. Eliminating it will not only help farmers and the West as it tries to curtail heroin use, but also Afghanistan's infant government as it struggles to assert its national authority against the warlords. A bankrupt warlord, after all, cannot buy weapons or bribe people to maintain their loyalty.
Major infrastructure investments will also be needed if the economy is to be revived. Housing, particularly for returning refugees, will need to be constructed fast. Cities such as Kabul, Mazar, Herat and others will need to be rebuilt as centers of economic and cultural life. Village housing must be provided at a massive level.
Roads, airports and communications systems must also be revitalized if trade is to be restored. The educational system needs to be rebuilt almost from scratch, and with so many women anxious to return to teaching, a revived educational system will also help Afghanistan's democratic politicians gain a powerful lobby of workers. Particular attention should be given to elementary schools and libraries outside of cities.
Afghanistan poses particular difficulties in reconstruction, as it is not a society with a strong political center. Planners should take advantage of the country's decentralized nature and emphasize private sector participation in reconstruction. A decentralized system will respond better to local needs and avoid an over-bureaucratic public sector. But autonomous economic regions should be avoided as a threat to Afghan national unity because they would play into the hands of the warlords. Moreover, poorer regions would do badly in such a system.
In the long run, Afghanistan has resources that can be exploited. There is the potential for oil and gas exploration, and of mining iron ore and precious metals. These activities should be explored in a framework of economic development across Central Asia. Afghanistan, indeed, must be integrated into the regional pipeline and other development schemes. Afghans can contribute in a tangible way here by reopening the North-South route connecting the resource rich economies of Central Asia to densely populated India and Pakistan.
None of this will be possible unless Afghanistan's young males are disarmed and given productive work. Essential here, is to attract expatriate Afghans with skills and professional achievements to help in rebuilding the country by establishing small firms that will suck up the unemployed. Expatriate involvement will also likely support the rights of women to participate fully and legally in economic and political life, as was the case before 1978.
Finally, donor countries must apply the lessons learned in restoring the war-ravaged states of the former Yugoslavia. Grants and planning must be coordinated, and the consent of Afghanistan's neighboring countries assured. If the latter are ignored, regional interests can incite chaos once again. An international conference on Afghanistan should be called by the US and held under UN auspices. It must affirm not only Afghanistan's territorial integrity, but insure that donor commitments meet the scale of the job and that these promises are kept.
A decade ago, the West turned its back on Afghanistan and chaos ensued. To abandon the country again would be criminal folly.
Twenty years of invasion, civil war, and drought have left Afghanistan's institutions in ruin. Millions of Afghans huddle in refugee camps or are displaced from their homes. Land-mines defile the countryside. Millions are sick and poor; many live at starvation levels. For these and many other reasons, rebuilding Afghanistan's economy will require not only economic reconstruction but an effort to reinvent the country's political and cultural institutions. Such a massive effort will be doomed to failure, however, if Afghanistan's neighbors intervene in ways that promote economic upheaval all over again.
Afghanistan is no place for quick fixes. Rebuilding the country cannot be done cheaply. Any thought that the anti-terror coalition will be able to bail out fast (as the West did when it abandoned Afghanistan to its fate after the Soviet withdrawal ten years ago) should be forgotten. The West must stick with Afghanistan until its reconstruction is established. Otherwise, it runs the risk of renewed chaos and violence, but this time in a more destabilized region, as Pakistan's current problems demonstrate.
Three problems are of immediate concern, the most important being feeding the Afghan people - both within the country and in refugee camps outside Afghanistan. Humanitarian aid is being delivered, but a distribution system safe from the predations of Afghanistan's warlords needs to be built. Indeed, the warlords have been given too big a say in distributing aid already, and it may be hard to strip them of this power. But stripped they must be.
The second problem involves relocating Afghan refugees now living in Pakistan and Iran, as well as those displaced within Afghanistan. To achieve this goal, the agricultural economy must be revived in order to revive this industry, providing jobs and food for people. A massive impediment here is the millions of mines left over from the Soviet invasion that must be removed.
The West has a big incentive to be generous to Afghanistan's rural poor. Starving farmers, if unassisted, may return to cultivating a very reliable cash crop: the opium poppy, long a staple of the warlord economy. Eliminating it will not only help farmers and the West as it tries to curtail heroin use, but also Afghanistan's infant government as it struggles to assert its national authority against the warlords. A bankrupt warlord, after all, cannot buy weapons or bribe people to maintain their loyalty.
Major infrastructure investments will also be needed if the economy is to be revived. Housing, particularly for returning refugees, will need to be constructed fast. Cities such as Kabul, Mazar, Herat and others will need to be rebuilt as centers of economic and cultural life. Village housing must be provided at a massive level.
Roads, airports and communications systems must also be revitalized if trade is to be restored. The educational system needs to be rebuilt almost from scratch, and with so many women anxious to return to teaching, a revived educational system will also help Afghanistan's democratic politicians gain a powerful lobby of workers. Particular attention should be given to elementary schools and libraries outside of cities.
Afghanistan poses particular difficulties in reconstruction, as it is not a society with a strong political center. Planners should take advantage of the country's decentralized nature and emphasize private sector participation in reconstruction. A decentralized system will respond better to local needs and avoid an over-bureaucratic public sector. But autonomous economic regions should be avoided as a threat to Afghan national unity because they would play into the hands of the warlords. Moreover, poorer regions would do badly in such a system.
In the long run, Afghanistan has resources that can be exploited. There is the potential for oil and gas exploration, and of mining iron ore and precious metals. These activities should be explored in a framework of economic development across Central Asia. Afghanistan, indeed, must be integrated into the regional pipeline and other development schemes. Afghans can contribute in a tangible way here by reopening the North-South route connecting the resource rich economies of Central Asia to densely populated India and Pakistan.
None of this will be possible unless Afghanistan's young males are disarmed and given productive work. Essential here, is to attract expatriate Afghans with skills and professional achievements to help in rebuilding the country by establishing small firms that will suck up the unemployed. Expatriate involvement will also likely support the rights of women to participate fully and legally in economic and political life, as was the case before 1978.
Finally, donor countries must apply the lessons learned in restoring the war-ravaged states of the former Yugoslavia. Grants and planning must be coordinated, and the consent of Afghanistan's neighboring countries assured. If the latter are ignored, regional interests can incite chaos once again. An international conference on Afghanistan should be called by the US and held under UN auspices. It must affirm not only Afghanistan's territorial integrity, but insure that donor commitments meet the scale of the job and that these promises are kept.
A decade ago, the West turned its back on Afghanistan and chaos ensued. To abandon the country again would be criminal folly.
No Time for a Trade War
The battle with the United States over China’s exchange rate continues. When the Great Recession began, many worried that protectionism would rear its ugly head. True, G-20 leaders promised that they had learned the lessons of the Great Depression. But 17 of the G-20’s members introduced protectionist measures just months after the first summit in November 2008. The “Buy American” provision in the United States’ stimulus bill got the most attention. Still, protectionism was contained, partly due to the World Trade Organization.
Continuing economic weakness in the advanced economies risks a new round of protectionism. In America, for example, more than one in six workers who would like a full-time job can’t find one.
These were among the risks associated with America’s insufficient stimulus, which was designed to placate members of Congress as much as it was to revive the economy. With soaring deficits, a second stimulus appears unlikely, and, with monetary policy at its limits and inflation hawks being barely kept at bay, there is little hope of help from that department, either. So protectionism is taking pride of place.
The US Treasury has been charged by Congress to assess whether China is a “currency manipulator.” Although President Obama has now delayed for some months when Treasury Secretary Timothy Geithner must issue his report, the very concept of “currency manipulation” itself is flawed: all governments take actions that directly or indirectly affect the exchange rate. Reckless budget deficits can lead to a weak currency; so can low interest rates. Until the recent crisis in Greece, the US benefited from a weak dollar/euro exchange rate. Should Europeans have accused the US of “manipulating” the exchange rate to expand exports at its expense?
Although US politicians focus on the bilateral trade deficit with China – which is persistently large – what matters is the multilateral balance. When demands for China to adjust its exchange rate began during George W. Bush’s administration, its multilateral trade surplus was small. More recently, however, China has been running a large multilateral surplus as well.
Saudi Arabia also has a bilateral and multilateral surplus: Americans want its oil, and Saudis want fewer US products. Even in absolute value, Saudi Arabia’s multilateral merchandise surplus of $212 billion in 2008 dwarfs China’s $175 billion surplus; as a percentage of GDP, Saudi Arabia’s current-account surplus, at 11.5% of GDP, is more than twice that of China. Saudi Arabia’s surplus would be far higher were it not for US armaments exports.
In a global economy with deficient aggregate demand, current-account surpluses are a problem. But China’s current-account surplus is actually less than the combined figure for Japan and Germany; as a percentage of GDP, it is 5%, compared to Germany’s 5.2%.
Many factors other than exchange rates affect a country’s trade balance. A key determinant is national savings. America’s multilateral trade deficit will not be significantly narrowed until America saves significantly more; while the Great Recession induced higher household savings (which were near zero), this has been more than offset by the increased government deficits.
Adjustment in the exchange rate is likely simply to shift to where America buys its textiles and apparel – from Bangladesh or Sri Lanka, rather than China. Meanwhile, an increase in the exchange rate is likely to contribute to inequality in China, as its poor farmers face increasing competition from America’s highly subsidized farms. This is the real trade distortion in the global economy – one in which millions of poor people in developing countries are hurt as America helps some of the world’s richest farmers.
During the 1997-1998 Asian financial crisis, the renminbi’s stability played an important role in stabilizing the region. So, too, the renminbi’s stability has helped the region maintain strong growth, from which the world as a whole benefits.
Some argue that China needs to adjust its exchange rate to prevent inflation or bubbles. Inflation remains contained, but, more to the point, China’s government has an arsenal of other weapons (from taxes on capital inflows and capital-gains taxes to a variety of monetary instruments) at its disposal.
But exchange rates do affect the pattern of growth, and it is in China’s own interest to restructure and move away from high dependence on export-led growth. China recognizes that its currency needs to appreciate over the long run, and politicizing the speed at which it does so has been counterproductive. (Since it began revaluing its exchange rate in July 2005, the adjustment has been half or more of what most experts think is required.) Moreover, starting a bilateral confrontation is unwise.
Since China’s multilateral surplus is the economic issue and many countries are concerned about it, the US should seek a multilateral, rules-based solution. Imposing unilateral duties after unilaterally labeling China a “currency manipulator” would undermine the multilateral system, with little payoff. China might respond by imposing duties on those American products effectively directly or indirectly subsidized by America’s massive bailouts of its banks and car companies.
No one wins from a trade war. So America should be wary of igniting one in the midst of an uncertain global recovery – as popular as it might be with politicians whose constituents are justly concerned about high unemployment, and as easy as it is to look for blame elsewhere. Unfortunately, this global crisis was made in America, and America must look inward, not only to revive its economy, but also to prevent a recurrence.
Continuing economic weakness in the advanced economies risks a new round of protectionism. In America, for example, more than one in six workers who would like a full-time job can’t find one.
These were among the risks associated with America’s insufficient stimulus, which was designed to placate members of Congress as much as it was to revive the economy. With soaring deficits, a second stimulus appears unlikely, and, with monetary policy at its limits and inflation hawks being barely kept at bay, there is little hope of help from that department, either. So protectionism is taking pride of place.
The US Treasury has been charged by Congress to assess whether China is a “currency manipulator.” Although President Obama has now delayed for some months when Treasury Secretary Timothy Geithner must issue his report, the very concept of “currency manipulation” itself is flawed: all governments take actions that directly or indirectly affect the exchange rate. Reckless budget deficits can lead to a weak currency; so can low interest rates. Until the recent crisis in Greece, the US benefited from a weak dollar/euro exchange rate. Should Europeans have accused the US of “manipulating” the exchange rate to expand exports at its expense?
Although US politicians focus on the bilateral trade deficit with China – which is persistently large – what matters is the multilateral balance. When demands for China to adjust its exchange rate began during George W. Bush’s administration, its multilateral trade surplus was small. More recently, however, China has been running a large multilateral surplus as well.
Saudi Arabia also has a bilateral and multilateral surplus: Americans want its oil, and Saudis want fewer US products. Even in absolute value, Saudi Arabia’s multilateral merchandise surplus of $212 billion in 2008 dwarfs China’s $175 billion surplus; as a percentage of GDP, Saudi Arabia’s current-account surplus, at 11.5% of GDP, is more than twice that of China. Saudi Arabia’s surplus would be far higher were it not for US armaments exports.
In a global economy with deficient aggregate demand, current-account surpluses are a problem. But China’s current-account surplus is actually less than the combined figure for Japan and Germany; as a percentage of GDP, it is 5%, compared to Germany’s 5.2%.
Many factors other than exchange rates affect a country’s trade balance. A key determinant is national savings. America’s multilateral trade deficit will not be significantly narrowed until America saves significantly more; while the Great Recession induced higher household savings (which were near zero), this has been more than offset by the increased government deficits.
Adjustment in the exchange rate is likely simply to shift to where America buys its textiles and apparel – from Bangladesh or Sri Lanka, rather than China. Meanwhile, an increase in the exchange rate is likely to contribute to inequality in China, as its poor farmers face increasing competition from America’s highly subsidized farms. This is the real trade distortion in the global economy – one in which millions of poor people in developing countries are hurt as America helps some of the world’s richest farmers.
During the 1997-1998 Asian financial crisis, the renminbi’s stability played an important role in stabilizing the region. So, too, the renminbi’s stability has helped the region maintain strong growth, from which the world as a whole benefits.
Some argue that China needs to adjust its exchange rate to prevent inflation or bubbles. Inflation remains contained, but, more to the point, China’s government has an arsenal of other weapons (from taxes on capital inflows and capital-gains taxes to a variety of monetary instruments) at its disposal.
But exchange rates do affect the pattern of growth, and it is in China’s own interest to restructure and move away from high dependence on export-led growth. China recognizes that its currency needs to appreciate over the long run, and politicizing the speed at which it does so has been counterproductive. (Since it began revaluing its exchange rate in July 2005, the adjustment has been half or more of what most experts think is required.) Moreover, starting a bilateral confrontation is unwise.
Since China’s multilateral surplus is the economic issue and many countries are concerned about it, the US should seek a multilateral, rules-based solution. Imposing unilateral duties after unilaterally labeling China a “currency manipulator” would undermine the multilateral system, with little payoff. China might respond by imposing duties on those American products effectively directly or indirectly subsidized by America’s massive bailouts of its banks and car companies.
No one wins from a trade war. So America should be wary of igniting one in the midst of an uncertain global recovery – as popular as it might be with politicians whose constituents are justly concerned about high unemployment, and as easy as it is to look for blame elsewhere. Unfortunately, this global crisis was made in America, and America must look inward, not only to revive its economy, but also to prevent a recurrence.
An interesting letter
Hope you are doing well. Forgive me if the content of the talk hurts you in any manner. My intention is definitely not to embarrass you or put you in inconvenience. It’s been a while that I am encountering a very strange feeling that gives me immense joy and peace. I would like to share it with you – and to let you know that the source of the happiness is you. In the next few minutes, I am planning to put in plain words what I think about you and the feelings I have for you. You have the liberty to switch off or sign off from listening to this. The worst trait of mine is I may sound very boring to you. So it is solely up to you either listen or not.
First things first:
1. You are fine-looking in all sense of the word.
2. You have a comforting voice that brings peace most of the time.
3. You are elegant and charming.
4. You are woman of resilience, calm determination and display excellent judgment.
5. You bring providence and confidence to people who look up to you.
Frankly the above mentioned points are not the reasons why I become crazy for you. Probably those are good reasons to be a good friend. But there are things more than that.
I feel close to my mother whenever I think about you. I feel that you are my child whenever I speak to you. I feel that you are close to my soul whenever I am with you. In short, I feel the warmth as if I am in my mother’s womb with no tensions, fears or insecure feelings – only peace, joy and calmness. I feel that there is something more of poetry, more of melody and more of godliness whenever you talk to me. Somehow I think I am continuously trying to become acquainted with you.
I wouldn’t call it a feeling of love or lust. I don’t know what it is. I do not expect anything from you – nothing from your emotional side, none from your physical side, and none from your material side. I fully want the sacred side of you – and I am sure that is one pristine side which you have not shared it with anyone yet. And I want to explore that. That is the reason probably why I am interested to see the many facets of your personality, curious to know everything about you in-depth. Do you know, by trying to explore you, I started exploring myself deep down into my inner mind. Getting deeper into myself, I have started knowing my feelings, thoughts, deeper stirrings and I understood how ghastly one’s thinking could be. In fact, the picture I have about you may be different from what you really are. But that doesn’t matter.
In fact I had thought not to verbalize my thoughts, as I believed it has to be a silent commitment; eye to eye, being to being and soul to soul. It thought it has to be understood, not said. I don’t know why his urge to convey the thoughts to you at any cost suddenly arose.
All I can say now is you can count on me for any support. Until then God bless you and your boyfriend/partner.
First things first:
1. You are fine-looking in all sense of the word.
2. You have a comforting voice that brings peace most of the time.
3. You are elegant and charming.
4. You are woman of resilience, calm determination and display excellent judgment.
5. You bring providence and confidence to people who look up to you.
Frankly the above mentioned points are not the reasons why I become crazy for you. Probably those are good reasons to be a good friend. But there are things more than that.
I feel close to my mother whenever I think about you. I feel that you are my child whenever I speak to you. I feel that you are close to my soul whenever I am with you. In short, I feel the warmth as if I am in my mother’s womb with no tensions, fears or insecure feelings – only peace, joy and calmness. I feel that there is something more of poetry, more of melody and more of godliness whenever you talk to me. Somehow I think I am continuously trying to become acquainted with you.
I wouldn’t call it a feeling of love or lust. I don’t know what it is. I do not expect anything from you – nothing from your emotional side, none from your physical side, and none from your material side. I fully want the sacred side of you – and I am sure that is one pristine side which you have not shared it with anyone yet. And I want to explore that. That is the reason probably why I am interested to see the many facets of your personality, curious to know everything about you in-depth. Do you know, by trying to explore you, I started exploring myself deep down into my inner mind. Getting deeper into myself, I have started knowing my feelings, thoughts, deeper stirrings and I understood how ghastly one’s thinking could be. In fact, the picture I have about you may be different from what you really are. But that doesn’t matter.
In fact I had thought not to verbalize my thoughts, as I believed it has to be a silent commitment; eye to eye, being to being and soul to soul. It thought it has to be understood, not said. I don’t know why his urge to convey the thoughts to you at any cost suddenly arose.
All I can say now is you can count on me for any support. Until then God bless you and your boyfriend/partner.
Subscribe to:
Posts (Atom)
