KIA MOTORS:Latest Entrant Into Auto-Making Boom

Kia Motors: Latest Entrant Into  Auto- Making Boom

News that Kia Motors, a Hyundai Motors subsidiary, will produce 300,000 compact cars and SUVs by the second half of 2019, is indeed good.  

It will do so at its $2 billion brand new facility in Penukonda, Anantapuramu district, Andhra Pradesh.

Iconic Chief Minister Chandrababu Naidu, who had once brought Bill Gates and Microsoft to Hyderabad, has bagged a significant new project. Earlier, Hero Motors and Isuzu had located new automotive plants in Chittoor district also.

The advent of the globally popular Kia brand, with 7 manufacturing plants around the world including this newest one, will mean an estimated 10,000 new jobs at the 576 acre location.

South Korea’s Hyundai Motors has, of course, completed 20 years in India. It came in just after market leader Maruti-Suzuki and firmly secured second place for itself.

This, in the 100% foreign direct investment (FDI) industry, allowed by the automatic route, that first opened up in 1991 and gradually put paid to the Ambassador-Premier Padmini era.

Happily, all the automotive ventures from the Hyundai conglomerate  have done well in the 3 million per annum car market in India.

The automotive sector, inclusive of passenger cars/MUVs/SUVs, commercial vehicles, three and two wheelers, car parts,  ancillaries, is a success story.

It has received $15.065 billion in foreign direct investment, on a cumulative basis, between 2000 and 2016. It accounts for 7.1 % of GDP, and 22% of India’s manufacturing GDP at present.

The entire capital goods sector, which notably includes electronics equipment and cellphones, currently employs 1.4 million people and expects to double this number going forward.

India is currently the 5^th biggest passenger car market in the world for vehicles that run on fossil fuels, and is headed towards the 3^rd position by 2020.

Market leader Maruti-Suzuki’s Chairman, RC Bhargava, welcomed the arrival of Kia, because he expects India’s automotive growth potential to provide ample room for competition. It is slated to take car sales up to 10 million per annum.

Several manufacturers, such as Hyundai, VW, Ford, are also creating capacity for exports from India.

All this joy is quite unlike the bedevilled, and finally abandoned, Posco Steel mining project, also hailing from South Korea.

Posco, formerly Pohang iron and Steel Company, wanted to establish a   $12 billion greenfield steel plant, way back in 2005. This, alongside the aborted Arcelor project, both in Odisha.

Both ran into political uproar, land acquisition, licensing, ecological and forest department brick walls, leading to extensive litigation. Finally, after over a decade of efforts, Posco followed Arcelor into giving up.

It has recently offered to return the 2,700 acres of state government land  near Paradip, allocated to it.

These two debacles are text book illustrations of how difficult it still is to execute a large mining, or indeed manufacturing project in India. We can cope with a billion or two in investment it appears, but what about 100 billion?

And it does our image, as a competitive investment destination, despite a fast growing economy, and huge domestic demand, no good at all.  

It  badly affects quantum inward investment. Total FDI in FY 17 is expected to be only $35 billion.

This is a pittance, when compared to China’s $128 billion from 2014, with another $111 billion for Hong Kong, separately!

The largest Indian potential investment sector, defence manufacturing, under the Make in India programme, does have the legs to easily attract $150 billion per annum. But, three years into the present administration, it has yet to take off.

This, due to multiple reasons. Including a reluctance on the part of collaborators to part with the latest high technology on reasonable terms, or even manufacture on a 100% owned basis in country, for fear, no doubt, of leakages.  

Besides, we lack adequate domestic infrastructure, or quantum matching investment, to cope with such large projects.

However,  several agreements have recently been signed and since it being a major policy thrust area to manufacture armaments in India, a breakthrough is also imminent.

Perhaps it could come, in the near future, via the Prime Min ister’s forthcoming visit to Israel, in badly needed Unmanned Aerial Vehicle (UAV” and “killer” drone manufacturing. India has imported about 200 drones and UAVs from Israel already.

There are other would-be collaborators, such as the manufacturers of the Griffen fighter aircraft from Sweden, who are willing to meet Indian concerns half way.

The mandatory “offset” clauses that call for up to 30% of any joint-venture in defence to source material domestically, also has a potential run-off of at least $20 billion annually.

Several top Indian companies have indeed formed joint ventures with approved foreign entities for the very purpose. But how soon can they expect orders?  

The problem apparently is in first settling up units capable of delivering parts for aircraft, tanks, automatic rifles, and the like, to the extremely exacting standards. The know-how for this has to be imported, and suitable locals have to be trained.

Even Hindustan Aeronautics Limited (HAL), a public sector aeroplane making facility, in existence for decades now, is thought to be inadequate and incompetent to assemble the Rafale fighters on order.

This is the situation, with Rafale refusing to guarantee the performance of locally assembled planes, let alone HAL manufacturing them after technology transfers.

Forward integration in manufacturing in defence weaponry and other high technology areas, is not possible without setting up competent backward integration units from scratch.

And this with the proper levels of technology, quality control, raw material sources, sophistication, secrecy, security, R&D, adaptation and tropicalizing capacity, etc.

“Red tape” also remains so endemic to the Indian process and experience, that despite lower labour costs, it is not easy to actually set up a new facility here.

Many initiatives remain to be taken, a lot to do with modernisation and infrastructure, to drive the share of manufacturing to 25% of GDP overall, with its potentially millions of new jobs, as intended.

Still, with immense efforts being undertaken by the Modi Government to simplify procedures and open up various sectors, the inertia is on its way to being overcome.

This particularly with more legislative control expected shortly with majorities in both houses of parliament.  

With the best of the Indian private sector very keen on assisting this grand vision, there is considerable hope for the future. Meanwhile, welcome Kia Motors.

For: ABP Live

(1,050 words)

April 29^th, 2017

Gautam Mukherjee

Mega Push For FDI Trillions: State Infra To Masala Bonds

Mega Push For FDI Trillions: State Infra To Masala Bonds

The Union Cabinet decision to allow financially well managed states to  directly borrow funds internationally, counter-guaranteed by the Centre, addresses several objectives at once.

One, obviously, is funding for the $1.5 trillion required over the next ten years for badly needed new infrastructure.

This dynamic move could prove to be something of an open sesame, underscored by the happy fact that the BJP/NDA now rules in 17 out of 29 states.

It is also likely to add more states still to its tally before the general elections of 2019 - which it is poised to win with enhanced majorities.

This new window of opportunity is restricted however to those states which have a healthy state fiscal deficit.

There is a no-questions-asked by New Delhi ceiling of 3%, similar to the central fiscal deficit target. And one stretchable to a many-questions-and-restrictions maximum of 3.5% of state GDP, again in line with the Centre.

The  borrowing states are also expected to settle the debt out of its own revenues.

The first one off the blocks to avail the opportunity to finance the trans-harbour link in Mumbai, pending for at least 50 years, is Maharashtra.

It is going to approach the Japan International Cooperation Agency (JICA) to fund at least Rs. 15,109 crores of the estimated 17,854 crores required.

Another avowedly Central Government objective is to promote greater federalism.

And even to provoke a competitive infrastructure development thrust between first-rank states, and others, less well fiscally managed at present, playing catch up.

The third point to be made is this permission is amongst a cluster of other enabling policy moves, designed for greater  governance efficiency, and to to garner foreign investment.

Reforms range from bank mergers, GST, a bankruptcy code, company law reform, income tax reform, demonetisation, and the digital push.

There are masala bonds being offered abroad, at least $1 billion worth, and being received enthusiastically.

Other bank bonds are also being quickly snapped up domestically.

The Foreign Investment Promotion Board (FIPB) has been scrapped, and further relaxation of the “automatic” investment routes in more sectors is being worked out. This, all the way up to 100% foreign investment is being allowed in many cases. And there are possible waivers of restrictive clauses like the mandatory 30% local sourcing in single brand retail.

There is a never-seen-before push for private and foreign investment into defence manufacturing facilities, and a simultaneous divestment of stake in HAL (of Tejas light combat aircraft notoriety), the Cochin Shipyard (buillding India’s own aircraft carrier), Pawan Hans for helicopters, and so on. India plans to build and buy $250 billion of defence equipment in short order.  

There is also a concerted push to revalue the rupee to make foreign investment very much more attractive.

This will improve our sovereign ratings and borrowing terms. The rupee has already appreciated 5% against the US dollar in the first four months of this year.

There is renewed enthusiasm from foreign investors after the huge assembly election successes in February. Gushes of money have come into equity and debt ($8.85 billion FII in March alone).

Domestic institutional and retail investors have also pumped in unprecedented amounts into mutual funds.

Infrastructure development will drive up the GDP growth rates to double digits and provide badly needed and massive employment opportunities.

Because of its downstream/upstream purchases and benefits, it will boost manufacturing and trading in general. It will also revamp the logistical parameters.

Combined with better connectivity and communications via the internet, road, rail, and air, 24x7 power availability, digitisation, bilateral treaties/joint ventures and technology transfers, competitiveness, efficiency and speed will improve.

India is developing a reputation now, given its ongoing reforms, political stability, and the fastest growing major economy tag, as a hot FDI destination.

It is expected to retain its growth lead in percentage terms over China for years going forward.

But India suffers for being thought of as a difficult place to do business.

This major lacuna is being addressed vigorously by the Modi Government at last, because it single handedly can stymie most of the progress.

This despite the massive domestic market, a large, young labour force, relatively low wages, skilled and trained managerial staff, and ample natural resources.

On the other hand, very few countries show India’s potential.

And confidence in India’s future is only growing. This, as the Modi Government grows stronger domestically, and simultaneously reaches out to the world.

For ABP Live

(732 words)

April 20^th, 2017

Gautam Mukherjee

Will The NDA Double The Buying Power Of The Rupee?

Will The NDA Double The Buying Power Of The Rupee?

A country’s economy gets reflected through its currency- Nirmala Sitharaman

Yes, that’s right, gradual revaluation is on the cards now, not just as economic circumstance, but as policy. The main reason for this may be the enhanced realisation that growth in the Indian economy is led 80% or more by domestic factors, including supportive imports, and less than 20% by exports.

Not only that, in the present world, even masters of mass and low technology export-led growth, such as China, do not have it easy.

The exception is high technology, almost exclusively from the R&D rich developed world, to the underdeveloped world.

This is somewhat inelastic and perennial, notwithstanding competition, and can often charge whatever it likes, and not have to worry about exchange rates either.

Prime Minister Narendra Modi, on the campaign trail in 2013-14, did make it clear that he would work to strengthen the currency. And now, it is beginning to happen, to the delight of international investors like Jim Rogers, who not only like strong currencies, but didn’t think a “talkative” Modi had it in him.

Recent economic circumstance has helped, such as an inflow of $8.85 billion foreign institutional investment (FII), in March 2017 alone.

This illustrative amount has flowed into Indian equity and debt, following on from a positive sentiment occasioned by the recent thumping election successes. The last time this happened in a given month was in boom-time 2002.

India runs a tight fiscal deficit at 3.5% heading towards 2.5% of an enhanced GDP, and this is much admired.

It has benefited from low inflation, lowered oil importation costs, and the fastest growth rate in the world for any major economy, projected at 7.2% this year, and nearly 8% next year.

The overt change in the Government’s policy towards strengthening the rupee seeks to also reorient the focus of the exporting community.

Indian exporters, for long, have been passively dependent on Government  intervention to keep the exchange rate favourable and themselves competitive in dollar terms.

 Accordingly, the Government has routinely bought US dollars, stacking them in our foreign exchange reserves, and sold Indian rupees through the Reserve Bank of India (RBI), deliberately keeping the national currency weak. 

Commerce Minister Nirmala Sitharaman and several others in the BJP taking their cue from Prime Minister Modi and Finance Minister Jaitley, have now suggested that export competitiveness should be looked at differently.Henceforth, it should be enhanced via improved policy decisions such as GST, digitisation, better company affairs management/transparency, and other initiatives in the pipeline.

The operational thrust should be on improving efficiency via automation, superior logistics, better infrastructure, removal of physical and bureaucratic bottlenecks, more value-addition, development of a cold chain etc..

Let us remember that our software exports are being hit, partially due to reduced demand because of automation and greater use of “cloud”, but also because of a tendency to body-shop and sell labour rather than invention and innovation.

Of course, a lot of the learned commentary may well concentrate on narrow focus statistics in the short term. This to claim whole swathes of Indian business and industry, from components to textiles, will be badly done by because of a strong rupee.

It is true, after all, that allowing and abetting the strengthening of the rupee, flies in the face of the conventional policy position in place for a number of years.

But it was, in hindsight, a position that ran contrary to the overall interests of the country, even if, like demonetisation, it involves some short term discomfort.

The rupee reached a high of 64.41 on the 13^th of April, the figure representing a 5% appreciation already against the US dollar in less than four months of this year.

Assuming that the US Federal Reserve does not reduce interest rates, nor raise them more than three times a year, and at the present pace, the rupee should indeed, based on domestic factors, continue to strengthen against the dollar.

Extrapolating the speed of current emerging trends, the prescient thinking is that we might be moving eventually towards Rs. 30 to the US dollar, at less than half of the exchange rate today.

This, not overnight, but certainly during the course of the “Modi era”, meaning the next 7-12 years.

Or could it happen quite soon, based on the present pace of things? Why not? Oil prices halved in six months via a demand supply mismatch, and fell further still before stabilising.

Rs. 30 is something of a time machine valuation target: it was last seen around 1994, 23 years ago, but could well come upon us again fairly quickly.

Should this happen, in reflection of a constant stream of bold  structural reforms/modernisations and their implementation, it has the potential to simultaneously transform the entire economic narrative of this nation root and branch.

Some well-worn things will become redundant, such as stashing black money secretly in convertible currencies abroad.

There would simply be no need when the rupee is stable, strong, and appreciating constantly. At double the present value, almost al fear of a flight of capital, will also be automatically banished.

It has been suggested that the previous political regime, renowned for its corruption, may have also kept the rupee deliberately weak precisely to assist the valuation of their secret hard currency hoards abroad.

Also, that, in cahoots with foreign predators, they may have, for the price of suitable kickbacks, made it possible for the foreigners’ dollars to buy/sell much deeper into Indian stocks, debt, business/industry/defence.

The exact reverse may be true now. With a strong domestic economy and political stability, volatility caused by global trends, even the extreme condition of war, may not be very arduous.

This could set the stage for the rupee to go fully-convertible, as behoves an aspirant to the UNSC. In fact, other countries who trade or manufacture in India, may well want to hold some of their reserves in the convertible Indian rupee. After all, India is set on a strong growth path for at least the next three decades.

The story so far however has been the exact reverse. We have seen two formal devaluations since independence, once in 1966, when the rupee stopped being pegged at Rs 13 to the British pound (since 1926), and was repegged at an official rate of Rs. 7.5 to the US dollar instead.

This, inevitably, following on from major balance of payment crises, high inflation, and almost non-existent foreign exchange reserves.

This rate slid gradually, and was at Rs. 17 to the US dollar in 1990, though unofficial rates ran at 20-30% higher.

But as another major financial crisis hit India in 1991, the official rupee caught up after it had to be devalued substantially. That year also saw the most extensive economic liberalisation in independent India’s history. 

Through the first decade of the millennium the exchange rate inched towards Rs. 50 to the US dollar and higher still thereafter.

 A stronger rupee now will lower our oil and import bills dramatically. 

Consumption spending on foreign goods will grow. As will the acquisition costs of companies and properties abroad. Indians taking foreign holidays will also benefit.

Our purchase power parity (PPP) rankings will improve substantially. So will our lending, borrowing and sovereign ratings, and those of our leading enterprises.

This will set up a virtuous cycle of foreign investment. It will grow our stock markets beyond recognition.

The GDP, slated to double from over $2 trillion, in the next five years, will quadruple instead.

The per capita incomes will improve substantially, given lower birth rates. Our national virtues of a vibrant democracy, a free and fair judiciary, media oversight, the rule of law, a large labour force and skilled professionals, will all further strengthen our international appeal.

Bottom line: a strong economy makes for a strong currency. It is not a double-edged sword at all once the benefits start rolling in, and should be welcomed with open arms.

For: The Sunday Guardian

(1,318 words)

April 19^th, 2017

Gautam Mukherjee

Weak Opposition Will Turbo-Charge New India

Weak Opposition Will Turbo-charge New India

The BJP/NDA, rather than the Congress/UPA,  at this time, may be in for a long stint in power.

This is already, and moreso as the time goes on, will result in a happy elimination of the distortions caused by the overt use of “secularism” and “socialism”. A usage designed to hold back, and ignore, the interests of a majority of Indians.

It is this outrage after all, that has consolidated the voters, and propelled the BJP into power. One, with an absolute majority in the Lok Sabha, for the first time in 30 years.

We are also in the process of witnessing a cautious rebooting of the political narrative, in the face of much cacophony from the Opposition, to remove the obstacles to a level playing field for all citizens.

Of course, this happy day did not come upon us all of a sudden, but has been working its salience ever since the era of coalitions began in earnest in the 1990s.

But, even ruling at the head of a coalition did not convince an imperial Congress to broad-base its electoral politics to accommodate and include.

The NDA’s former stint in power, at the apex of an unwieldy 40 plus party coalition, helmed by statesman AB Vajpayee, saw the only manifestation of a multi-party democracy in this country.

But that lasted only for a little over 5 years. That is, unless you count the short-lived Janata Party Government, and others, that ruled for mere months, valiantly trying to be even-handed, if not cohesive.

But, in hindsight, the era of coalitions also brought to the fore the difficulties posed by opposition, backed by leverage.

Small coalition partners held the sword of Damocles over the survival of the central government, and swayed its policies.

Later, even sizeable, largely single party opposition, as in the decade of UPA rule between 2004-14, failed to usher in much constructive cooperation.   

Part of the reason is that, as parliamentary democracy has evolved in India, the concept of a “constructive opposition” has been upstaged by partisanship - an attitude also very visible in America, much longer at the practice of democracy than ourselves.  

Is this then the essential flaw in democratic practice,  that electoral dominance can subdue, but never eliminate?

The present Indian Opposition is finding that its concerns, the highlights of its era in power, may truly have passed.

Its best initiatives have been taken over by the Government, and all it is left with are its failures, contradictions, and legacies of corruption.

At first, if Congress and its allies thought they could bounce back in 2019, they probably do not think so any more - threats of a supple enough mahagatbandhan notwithstanding.

The ruling combine, aware and not smug, clearly has its finger on the pulse of the electorate and its aspirations.

The BJP is, under the charismatic leadership of Prime Minister Narendra Modi, and the electoral engineering of Party President Amit Shah, mopping up everything from grassroots elected local governments,  to state after state in assembly elections.

Coincidentally, the situation is turning grim in many of the competing political parties including a clutch of regional ones.

They are facing existential crises, and lack of traction. As they lose power around the country, except in some stubborn pockets, their ability to influence the national narrative is reducing dramatically.

While this may be bad news for the dwindling Opposition, it is good news for the progress of the country.

Session after parliamentary session has been washed out because of disruption and obtuse partisanship, particularly in the upper house where the present government does not yet have a majority.

This has not only stopped or delayed vital legislation, with disgraceful demonstrations as opposed to reasoned debate, but wasted a great deal of the taxpayer’s money as well.

After the recent victories in four assembly elections, particularly the overwhelming victory in Uttar Pradesh, the NDA is within sight of a simple majority in the Rajya Sabha as well.

In short order, this will help the NDA Government considerably in the forthcoming elections for the new President and Vice President, in order to appoint persons of its choice.

But, with more expected assembly election wins in late 2017 and 2018, the NDA will be well poised to not only control both houses, but also clinch the general elections in 2019, probably with enhanced strength.

This, in turn will enable it to proceed with much greater boldness on pending and enabling legislation.

It will occasion a smoother interaction with the judiciary with the ability to overrule any continued obstructionism from it.

The Government will also be able to address long-standing and emotive issues such as the Uniform Civil Code and the building of a Ram temple at Ayodhya.

It will be empowered to effectively tackle the unrest in the Kashmir Valley, and Article 370.

It will be able to push reforms to provide a great boost to the economy and sharply reduce the travails of the poor.

Departing then, from the much bandied conventional wisdom that a “strong opposition” is good, even essential, for democracy, the opposite can be argued for quite convincingly.

In emerging economies like ours, rising up from a colonial past, with newly minted and grafted political systems, and universal suffrage imposed suddenly, democratic opposition often proves to be an irritant.

It is, in India, just about 70 years old, and more generally, it is democracy itself that results in full-fledged obstruction.

How efficient would China be, one wonders, if it had the luxury of political freedoms for its people?

Our long-winded but hybridised political system (Constitution), was cobbled together mainly using the British and American systems as role models. It was done by a painstaking constituent assembly led by a somewhat misunderstood  Dr.B. Ambedkar.

So much so, that the original work, dedicated to the nation in 1950, has been twisted, confused, subverted, and modified multiple times. And most notoriously, via the 42^nd amendment, of 1975.

The 42^nd Amendment, forced upon the nation during the Emergency by Indira Gandhi, introduced 59 separate modifications. Some of these were subsequently reversed by the Janata Government that followed.

But, it also sought to redirect its essential nature, and did untold damage by inserting “secular” and “socialist” to the “sovereign republic”  descriptor in the preamble section. This, curiously, was let to stand by the Janata Government.

There was probably little realised about its pernicious effects on “vote bank” politics at first. And it began to dawn on the nation only when the Congress Party stopped receiving majority verdicts in elections.

This first period nevertheless lasted some 60 years, since 1947 - from Nehru’s rule of a fledgling nation to the exit of Rajiv Gandhi, delivering, effectively, a one party rule.

Though this was not so in a formal sense, it was, nevertheless a de facto reality.

It also afforded great ability to renege on solemn promises. It was once thought that treaties entered into by Britain, the suzerain power, with the Princely States, could never be thrown over till the sun and moon travelled the heavens. But the British simply left, and threw the princes to the wolves.

Likewise, that the Privy Purses would never be revoked by an independent India as they were the price of accession. And, alongside, that the Stalinist act of nationalising all the private banks at one fell swoop was quite unthinkable!

And yet, all this was accomplished by mere executive action!

Now that the BJP with its “sabka saath, sabka vikaas” philosophy, is on the threshold of mirroring those first unfettered 60 years with untrammelled “single party” powers – it too, will, inevitably, dismantle some of the shibboleths of those years.

 This, even as the country forges ahead to meet its matured “tryst with destiny” - to become, not merely independent, but a developed nation.

One capable of meeting the aspirations of its largely young population, of over 1.25 billion people.

For: Nationalist eJournal

(1,314 words)

14^th April 2017 (Ambedkar Jayanti)

Gautam Mukherjee

India Furious: Pak Kangaroo Court Frames Captured Indian

India Furious: Pak Kangaroo Court Frames Captured Indian

It took the outrageous pronouncement of a killer verdict from a Pakistani military court against an Indian businessman, to effect an unprecedented parliamentary unity.

The man in question, former Indian Navy Commander Kulbhushan Jadhav, was kidnapped, by Al Qaeda/Taliban in Iran.

He was subsequently sold to Pakistan’s ISI, a little before the Pakistani terrorist attack on the Pathankot Airbase in January 2016.

The trumped-up charges of spying for India’s R.A.W., and a three-month long kangaroo court-like proceeding against Jadhav, had MP after MP on his feet demanding action and satisfaction.

 On the 11^th of April, when news broke about Jadhav’s death sentence, the NDA had just finished holding a celebratory meet after recent election successes. This, on the auspicious occasion of Hamuman Jayanti.

And while parliament was in no mood to tolerate this latest provocation from Pakistan, the day’s events also saw a motley crew of Indian peaceniks inviting the Pakistani Ambassador, Abdul Basit, former Foreign Minister Khurshid Kasuri and others, to tea at the India International Centre (IIC), in New Delhi.

But, things did not go altogether to script at the IIC. It ended with a scuffle and some cuts and bruises, when members in the audience objected to Ambassador Basit, long thought of as a Pakistan Army nominee, calling Jadhav a terrorist on a Pakistani TV channel.

The Pakistan Army court verdict on Jadhav was arrived at on the strength of an ISIS style video-taped confession, obviously extracted under duress, evidenced by its rough editing.  

Jadhav was apparently not even accorded a defence counsel!

The Modi Government, via the Home Minister Rajnath Singh and External Affairs Minister Sushma Swaraj, were the ones who called the death sentence a primitive attempt towards “premeditated murder”.  

Kulbhushan Jadhav travelled often between Chabahar Port area, where he ran his business, and Tehran, in Iran. He was simply abducted on one of these trips.

Pathankot, let us remember, came just after Modi’s impromptu visit, dropping in to meet Nawaz Sharif at his daughter’s  wedding near Lahore, on his way back from Afghanistan.

The Pakistan Army made it clear then, and not for the first time, that it is not interested in rapprochement with India.

The Pathankot attack and Jadhav’s emergence as a prisoner, both underline the same grim fact.

Jadhav was transferred  into Pakistani hands along with his valid Indian passport and relevant Iranian visa, becoming an instant pawn in the Pakistani narrative, that India too played, if not at cross-border terrorism,  then certainly at cross-border spying. And it was stirring up trouble in Baluchistan.

A spy with transparent identification alone would tend to rule him out of such games for the lack of deniability.

But, the Pakistan Army couldn’t care less, and seems determined to use him for leverage anyway.

That is why there has been a variance in the pronouncements made on Jadhav, by say, senior politico Sartaj Aziz, who said there was no clinching evidence against him, and what is now emanating from apologists like Defence Minister Khwaja Muhammad Asif.

Asif  has been busy since the 11^th, drolly deflecting criticism for the ‘premeditated murder’ barb, by citing atrocities here in India.

The broader implications of this sudden Pakistani action, in violation of the Geneva Convention, suggests a new level of desperation.

Many of Pakistan’s initiatives to cause trouble in the Kashmir Valley and elsewhere in India are losing traction, notwithstanding the stone-pelting, arson, and insolent behaviour.

Something needs to be done to revive the hostility pitch and prevent any possibilities of dialogue between the two countries. Hanging an innocent man just because they can might just fit the bill.  

This move signals, in short order, that Pakistan will not follow international law on the treatment of captured Indians. In this, it draws inspiration probably from North Korea, its old missile providing buddy.  

But former R.A.W. Chief A.S. Dulat, familiar with Pakistan’s ISI, scoffs at the notion that Jadhav will actually hang, hinting therefore that this is a feint to keep the pot boiling.

That it will, if carried through, almost certainly invite reciprocal and even punitive consequences from India, seems to be lost upon the Pakistan Army. The loss of men for a cause does not bother Salafists or Communists.

Is China egging Pakistan on for this one? Could be, but this seems like very small potatoes in that context, or is there more, not in the public domain?

Is Pakistan and China worried about Baluchistan and the CPEC/Gwadar and India’s potential to wreck their plans. Perhaps.

Is the Pakistan Army just busy putting its own political friends in their place in the run-up to elections in Pakistan?

The ISI, fighting with shadows and looking for scapegoats, also captured a pair of Indian clerics, it must be remembered, recently.

It detained the head of the Nizamuddin Dargah in New Delhi and his nephew, during their visit to Pakistan. They were let go off, after a couple of days of questioning, but only after vigorous intervention of the Indian Foreign Ministry.

Jadhav has been held without Indian consular access. It is a who will blink first game. India refuses to agree that Jadhav is a spy and grant Pakistan the equivalence it seeks. Pakistan won’t grant consular access unless we agree that he is.

Jadhav now has 40 days to appeal the order in the Pakistan Appeals Court, which may or may not be their High Court or even their Supreme Court in this instance. And failing which, to beg the Army Chief and/or  the President of Pakistan for clemency. Will he have to do all this personally, without help?

India, officially ruled out of the action, cannot do the knee-bending, even if it wanted to. It can only exert diplomatic, back-channel, and internationally orchestrated pressure, to resolve the matter, and get Jadhav returned home.

That it may not even have 40 days, should the Pakistan Army decide to hang Jadhav in a hurry, is also a matter of no little concern.

And since the primary effort at the moment is to save Jadhav’s life and secure his return, all other options on retaliation are necessarily on the back-burner.  

Meanwhile, scrambling already for legitimacy in the face of the hue and cry raised by India, Pakistan is trying to retrofit Jadhav’s name with that of a minor Balochi mafia don it has been holding in custody for even longer.

However, internationally, even spies are tried in the civil courts during peacetime, and guaranteed “due process”. This is a bit of a Pakistani PR problem, but the uniforms seem determined to ignore it.

The use of a military court in this instance, and the death sentence,  might also, some suggest, be a desire to  urgently swap  Jadhav with some of their assets languishing in Indian jails.

But, going by the past, the Pakistanis are not very keen on claiming any nationals caught on the Indian side for any reason.

In this context, more fevered theories include the notion that India may, or may not have, spirited a former ISI Lt.Colonel out of Pakistan into Nepal, and thence from Kathmandu to Lumbini, and finally into its “non-state actor” clutches across the Indian border.

Is this man for questioning, or trading, if we really do have him? Does he have anything to say, and does Pakistan care? The US/USSR Cold War parallels may be vastly overblown here.

The manner of the doings with Jadhav, certainly reiterates the point that it is the Army, at Rawalpindi, and not the political dispensation, at Islamabad, that truly runs the country.

And the Pakistan Army, as usual, wishes to maintain its visceral hatred for India unchanged  in order to maintain its domestic ascendancy.

For: The Sunday Guardian

(1,283 words)

April 12^th, 2017

Gautam Mukherjee