The Feel Of Modern India Coming Into Its Own

Cut to the independent republic of India circa 1947, and we can see Socialism, Soviet style Five Year Plans, the Licence-Permit Raj, The Mixed Economy, Non-Alignment. All this produced no more than 2% growth on a miniscule base of around $250 million. This stunted India’s stature. 

Apologists say it laid the foundations of the fledgling republic, with its heavy industry and institutions of higher learning. But capitalism, as in Singapore, that joined the party only in 1962, would have no doubt done better, and faster. President Lee Quan Yew often shook his head at the waste and folly he saw in a country with the potential of India.

Capitalism was anathema to our early leaders. It was tainted with memories of the laissez-faire East India Company, and later the British Raj with its pillage, loot, monopolies, destruction of local craft, industry and enterprise. 

It was only after India went bankrupt in all except name, that a drastic change was made. India dumped a lot of the old economic order in 1991. This was under dictation of the international lending agencies which handed in a non-negotiable to-do list to the Government of India. However, then Prime Minister PV Narasimha Rao was not unhappy. A veteran Congress politician, learned, erudite, he had been looking for a politically acceptable way to break out of the ideological shackles.

After the changes made, the day-to-day situation in India, previously riddled with Soviet style shortages and shoddy goods on a take- it-or-leave-it basis, change beyond recognition. For the first time India began to see 9% growth rates.

India may not wear socialism on its sleeve anymore, nor lecture the rest of the world on its virtues, but it is highly committed to welfarism.  This has gone beyond the slogans of the early decades into solid gains towards the elimination of hunger, disease, illiteracy. It has delivered connectivity, basic utilities, housing and sharply reduced numbers below the poverty line.

Meanwhile, China had already been producing double-digit growth from the 1980s. This, after radically altering its attitude to capitalistic methodology. That it is once again going down-hill, is a consequence, in part, of its revival of hard-line Communism and chronic indebtedness.

Cut again to 2021 India, thirty years on when India has a $3 trillion economy. Observers in the developed world see India’s new dynamism and liken it to Europe during the Industrial Revolution, or America in its pioneering frontier days. There is a new tonality and aspiration that is very refreshing. In addition, India is an acknowledged thought-leader and agent for global peace, plenty, and responsibility. It agrees to help retard climate change.  It wants an end to terrorism and expansionism.

Mark Mobius, a legendary billionaire global investor, says India has entered a 50-year bull market, and can expect 9% growth year-on-year for the half century. This, even as China is in decline. He has put most of his emerging market investment into Indian stocks. Mobius is not the only one, though his bold prescience is notable.

There are now many clean breaks with the past. Our infrastructure on land, sea and air is looking at providing for the next three decades. Modernisation and digitisation is being pushed hard. What was never done before is being attempted in multiple fields. India has stopped looking on itself as a poor country of low per capita income and teeming millions.

Instead, it is relentlessly getting on with the job of emerging as the third largest economy in the world. Of course, having 1.4 billion people is both a blessing and a curse. However, no economy can thrive on the backs of only well-to-do people. Europe and America have long realised this. Immigrants, eager to do the lowly paid jobs, have been vital.

India, thanks to its fecundity, does not have to look at this in policy terms for at least thirty years. However, the presence of over 2 crore illegal Bangladeshi immigrants tells the essential economic story. They not only meet their own need for livelihood, but to a certain extent, rising material costs apart, do their part in holding the line on inflation.

India is also erasing the poverty-stricken continuity with its colonial past. Physical structures such as North and South Blocks and the round present-day parliament building will soon become museums. The new, expanded Indian Railway networks are supplanting the superannuated British outlay. The Victorian era railway stations are fast disappearing and giving way to modern structures on par with the best in the West. The inter-city and inter state highway systems are removing transportation bottlenecks.  The airports and airline scenario is replete with choice and more than a little competition. Old PSU behemoths are being closed down, merged, or privatised. Even profitable ones such as the monopolistic LIC and ONGC are being partially sold off. Air India was the first large unloading of a storied airline piling up heavy losses. But clearly it will not be the last.

Bureaucrats, for long years beyond accountability, have been instructed that they cannot move files beyond four levels and that too transparently and digitally. Acres of redundant government files and other obsolete junk have been sold to raddiwalas.

Once the ‘Fabled East’ meant Bharatvarsha, richest in the world, bulging with gold and jewels. ‘The Middle Kingdom’ was no match. India also had its palaces, temple architecture, universities, city planning, drainage and wisdom that stupefied early visitors from the West, the East and Arabia alike. But nobody calculated GDP then. Besides, Bharatvarsha was a region, much bigger than it is today, populated by many independent kingdoms.

The present renaissance however, promises to leave fabled India behind. It will see India to a $ 10 trillion economy and more with a combination of domestic demand, aatmanirbhar manufacturing and services, and exports.

China, long plaguing India via proxies and menaces, could break into an open attack. The question is, can it win? Despite this existential risk, this is definitely a good time to be an Indian.

(993 words)

13.11.2021

For: Firstpost

Gautam Mukherjee

 

 

For Atmanirbhar New India: Reboot History & Popular Culture

 

A New India needs a revision of its history. Similarly, it needs to examine the tropes in popular entertainment and culture that seek to promote a hatred of Hinduism and its alleged caste divisions.

For the early decades since independence, a pandering to the minority vote banks by the Congress Party, was squarely responsible for this. Later it became something of a template as regional parties poached the Congress support.

And then there was the commitment to socialism, though it proved disastrous for economic growth. Nevertheless, academia was put to work to cast Indian history and economics in a Marxist mould.

For cinema and the digital streaming space to project the current government and its policies as communal is undemocratic. A Hindu nationalist government that has been voted in with large majorities is not ergo determined to subvert the constitution. It may well change certain clauses, as prime minister Indira Gandhi did. This is how a great anomaly, the special status of Jammu & Kashmir, originally introduced without debate as a temporary measure, was set right. A living constitution needs amendment from time to time. The trouble is, what is good for the goose, is not readily granted to the gander.

So what does an atmanirbhar New India need from the historical narrative and from popular culture? First and foremost there is a need to evolve and accept a home grown and grass-roots Indianness.

Marxism is not an Indian concept. Neither is a fraudulent form of secularism. Ditto aping British practice, whether in parliament or in the judiciary.

The other is to reach back. Beyond the advent of the British and the Islamic rulers, to find our historical identity amongst the many great Hindu dynasties and Seers. To glory in our ancient cultural, scientific and spiritual excellence. To drop the Macaulayism that has enslaved our minds.

A new found interest both amongst Indians and foreigners in Hindu Studies, Diwali, Yoga, the great epics of the Ramayana, the Mahabharata, the Upanishads, Puranas, indeed Sanatan Dharma, is now apparent. Many are starting to realise the living management lessons that can be derived from the Bhagwad Gita.

India is now a reformist powerhouse for others to emulate. It is becoming a substantial defence and armaments manufacturer. The stupendous response with vaccines and vaccination has been noted by the whole world. Its increasing export footprint is taking on from a relocation of supply chains from China. India’s diplomacy is resulting in dramatic new alignments. It has the greatest growth statistics in the world post Covid. The start ups and unicorns populating the stock market are a case in point. There is nothing derivative in it. This is home grown dynamism.

Contrast this situation at the end of 2021 with how it all began. The need to revise the independence narrative too. When Jawaharlal Nehru wrote his Discovery of India, he was lodged in a comfortable palace turned jail as a Class One political prisoner.

His British jailers called him Sir, he could take his constitutional chukkers around the property, receive vetted visitors, and was served his meals.  He saw himself as the first prime minister of independent India in waiting.

This no doubt infuriated Mohammad Ali Jinnah, a fellow Lincoln’s Inn lawyer and loyal Congressman at the time. But then, Jinnah did not have the backing of Nehru’s fellow prisoner Mohandas Karamchand Gandhi, as often hailed as a Mahatma, as Nehru was called a Pandit by the press of the day.

Nehru had a room with a window, curtains , a bed, not a pallet. There was a sofa and a side table. It was not a cell with bars, he wasn’t locked in, though there were sentries. There were no leg irons and solitary confinement. Nehru was never sent to the Cellular Jail in the Andamans that Veer Savarkar had to endure.

In the writing of his vision statement, Nehru, who saw himself partly as an Englishman in Khadi, wasn’t just imitating Winston Churchill, but outlining his Fabian Socialist cum Unity in Diversity paean to pluralism.

India had about half of its landmass under the princely states then, and the rest had many geographical, linguistic, religious and cultural variations. It seemed vital to Nehru, in the context of his times, that India could not have any divisive ideas of its own. He was lucky indeed to have Sardar Patel by his side. That this lofty vision was first cut asunder by Partition caused by his lust for power, and then steadily subverted by himself as prime minister is the story of his The Idea Of India.

Pandering to the minorities at the expense of the majority is the original sin of independent India, or is it the low growth of Fabian Socialism?

Nehru’s Congress Party successors consolidated this distorted ideology, holding the voter in contempt, till, at last, there were upheavals. The first of them came in the seventies with Jayaprakash Narayan, the Lohiaites and the unstable opposition coalitions that followed. Then came partial rejection at the end of the nineties with the advent of prime minister Vajpayee. Last came the resounding rout in 2014.

Churchill began his multi-volume History of the English Speaking Peoples in 1937, ensconced in his ancestral Blenheim Palace.

Churchill’s leadership during WWII  was deservedly lionised. And in this time, as prime minister, he saved Britain from Nazi occupation, principally by begging for and securing American support.

 Churchill’s imperialist views made no sense once America became global number one. It forced the dismantling of the British Empire, starting more or less with India, Britain’s Jewel in the Crown.

That Nehru and Gandhi, political moderates, were allegedly in a cosy relationship with the British does not surprise anyone today.  That they did not really secure the independence of India in 1947 is a moot point. They played their part certainly, as did Subhas Bose. But it was probably American dictation that did the trick. A war torn and bankrupt Britain was in no position to resist.

 

(996 words)

For: Firstpost

November 11^th, 2021

Gautam Mukherjee

 

Undead Imperialism Can’t Digest India’s Digital Success

The Economist, a British weekly magazine, now depends on its American subscribers, having switched from backing the extinguished British Empire, to American supremacy.

It has a combined print and digital subscription globally shy of 2 million. It also claims to reach 35 million via its social media platforms.

While giving itself an unproven seventeen-fold reach, it had no difficulty in scoffing at the scale and reach of India’s digital revolution. It once praised Aadhar but that must have been a slip. Because it regularly slams the Modi administration under the present Editor’s watch, citing the original sin of the 2002 Gujarat Riots. This apparently gave it the temerity to exhort Indians not to elect the Hindu nationalist BJP, or failing that, Modi as prime minister.

This from a magazine representing a people that had its war-time Prime Minister Churchill murder over 4 million Indians in the man-made Bengal Famine of 1946. A Raj administration that shot unarmed, men, women and children at Jallianwala Bagh with nary an apology. A nation that responded with ingratitude and silence about 2 million plus Indians that fought in the two world wars alongside the British.  

A constant criticism in repeated articles is about the Indian government’s alleged antipathy towards civil liberties and the 200 million strong Indian Muslim community. The Economist treats its story-telling as proof. It pretends it knows best.

The Indian digital revolution, though a work in progress, is an astounding success. But the Economist thinks it will leave out the poorest and create a great divide between the haves and have nots. That our digital reach has been facilitated not just by the crores counted by the biometrically authenticated Aadhar, but also widespread bank accounts for the erstwhile unbanked is ignored. Common usage of the internet for online shopping, tele-health consultations, digital payments, music, movie streaming, OTT likewise.

The Economist likes adopting a tone of omniscience. But this is being challenged by others on home turf and across the Atlantic who also lay claim to economic liberalism. But not a dodgy, U-turning version of it. The magazine employs exclusively White staffers, educated at Oxford or Cambridge. Unfortunately, despite its storied history supporting the British financial establishment, it increasingly offers slanted, hectoring, Oxford Union style leftist opinion. This, dished up as sharp analysis garnished with acute word play.

The Indian digital economy, at $ 200 million in 2017-18 is headed towards $ 1 trillion by 2025, with 900 million active internet users. In 2020, 25% of the adult female population owned a smartphone while 41% of adult men did. We know most teenagers, and not a few children do as well.

Rural broadband penetration stands at 29% while the national average is at 51% (687 million people), as on March 2020. But this is changing rapidly. Rural internet penetration is growing at a pace 3 times faster than  in urban India. Wireless telephony constitutes 98.3%. Teledensity in India already stands at 86.6%.

Covid has played its part to hasten matters. School closures forced teaching over WhatsApp, and many people purchased smart phones to access it. India has the largest number of students globally at some 315 million.

Digital illiteracy and unfamiliarity with digital platforms have driven many people to community services like cyber cafes in urban areas, and village choupals that own a TV, computer, smart phones, have connected broadband, electricity back-up. They also have skilled and knowledgeable operators. There are simple EMI schemes to enable poor people to purchase inexpensive smart phones, and Mobile Libraries to borrow them for online sessions. There are ‘Digital Didis’ to teach women how to use it and reduce gender-based hesitancies.

The Economist’s neo-colonial top-down assessment is not surprising however, given its allergy to the Modi government’s nationalistic assertions, and its successes. India overtook the British ($2.83 trillion) and French ($2.71 trillion) economies at $2.93 trillion in 2019 itself. This is not the India the Economist is used to preaching at, with its endemic corruption, low growth, dependencies, and chronic inefficiency.

This time, the Indian government has, unusually, written to the magazine, calling this latest outing ‘inaccurate and biased’. Perhaps it is a warning to the British establishment that the Economist represents.

The magazine does not byline its articles, hiding under a collective eiderdown. It espouses a lofty if obscure stance of ‘economic liberalism’ and ‘radical centrism’, which probably means hitch-a-ride on the latest vehicle of Western neo-imperialism in order to survive.  It is owned largely by the Agnelli family of Fiat fame (43.4%). Other owners are its staffers, Rothschild, Cadbury and Shroder Layton. Currently, it boasts of its first lady editor, Zanny Minton Beddoes, Oxford and Harvard educated, who joined the ‘newspaper’ in 1994, and became its Editor-in-Chief in 2015.

Being left out most often in the stupendous gains India has made since 2014 is one of the reasons for the Economist’s pique. India does not need foreign help with its digital revolution. India’s software exports at $133.7 billion in 2020-2021, were up 4%.

On 21^st October 2021, India completed the free vaccination of a billion adults against Covid. The Economist can be sure many of these people were amongst the poorest, lodged in remote areas, and included a large number of Muslims. It is now going ahead with inoculating the rest of the adults, some 20 million strong, and then onwards towards children and teenagers between the ages of 2 and 18. All this with the very effective India-made vaccine Covaxin, alongside the Oxford Astra Zeneca franchised Covishield. It is also exporting vaccines and making other types under licence such as Russia’s Sputnik. Yet more are in the works.

Democracies, with growing woke sensibilities, are increasingly difficult to manage. But India, with a population of 1.4 billion and multiple religions, languages, customs, topography, does a consistently good job.

This, for whether it is turning the entire nation largely digital, running the world’s largest election machine, or lately, hitting back at Western misinformation motivated by envy, lazy journalism, and sheer disbelief.

(995 words)

October 22^nd, 2021

For: Firstpost

Gautam Mukherjee

 

India Has A Century Worth Of Coal If We Need It

Do we have a coal shortage? In absolute terms-no. But did a lot of the thermal plants around the country let their coal stocks go below even 5 days stocks-yes.

They did so, basing their demand projections on near flat Covid induced demand last year. Maybe they were expecting a third wave as bad as the second. Instead, the intense round of vaccinations, nearly 100 crore people worth, has greatly assuaged the situation.

There is a reason for the hesitation. Electricity, once produced, is a perishable commodity without expensive and high technology methods of storage. The US has created over 25 gigawatts of strategic electrical energy storage. But India has next to none, unless you count a few batteries. But we do have a National Grid and Exchange. The trouble is, it buys at market rates and sells its electricity to the highest bidder. This can upset contractual rates and force electricity selling prices upwards.

Besides, the thermal generation units let this squeeze happen every year post Monsoon. There is a dip in the mining of coal after the rains till all the water can be drained. Still, dry coal stocks at the mines are maintained at about 22 days demand. Coal India meets 80%, though many thermal units have been importing a lot in past years.

Caught out by their own calculations, particularly in Punjab, Rajasthan, Jharkhand, thermal power plants are scrambling to raise stocks to 15 days need now to meet a sharp uptick in demand of more than 20% .

The manufacturing economy has woken up to the emphasis on atmanirbhar, and opportunities based on at least partial relocations from China. Other sectors of the economy too have perked up enough to produce the highest growth forecasts in the world for this fiscal. Rural electrification has increased consumption. GDP is headed to clock 9.5% growth this year followed by another 8.5% growth on top of that next year as well. The IMF and World Bank are saying so, and not our government statisticians.

Economics being a demand/supply game there are a few associated problems on the coal imbroglio that cannot be glossed over. The thermal plants owe the coal suppliers Rs. 20,000 crores in unpaid bills. Nevertheless, enhanced coal supplies are already at 1.62 million tonnes a day heading up towards 2 million tonnes a day post Dussehra, according to the coal minister Pralhad Joshi.                                                                                                                                                                          The PMO has taken a quick supervisory interest, as it doesn’t want anything like this to damage the return to robust growth. The partially revamped and far more dynamic railways  are moving vast tonnages around the country on an emergency basis.

The electricity distributing companies (discoms) also owe the generating companies Rs. 1,60,000 crores in unpaid bills. Presumably, this is because the governments of the States and at the Centre have not paid. Private consumers have to pay if they don’t want to be cut off. Present firefighting apart, the situation seems pretty precarious.

The political buck passing that is usual in such situations has been countered rather well by the Centre in this instance with ready facts and figures. The comparisons in the international media with China are misplaced, because China is highly dependent on imports to make up the deficit in demand. That it is in a financial bind right now is another matter.

In the broader context, India has the 5^th largest proven coal deposits in the world after the US, Russia, Australia and China in descending order. Some accounts put India at No.4.These can last us for 111 years at present offtakes, but even accounting for increased requirements, it’s enough for at least a century going forward. And that’s assuming no further discoveries of large deposits.

However, with concerns over pollution, scrubbing expenses, environmental concerns, the Paris Accords, coal is regarded worldwide as a bad old Victorian Industrial Revolution leftover.  However, it would be a mistake for India to not leverage a strength just to please the climate lobbies. Concern over global warming may be real, but immediate fuel shortages and spikes in pricing are more compelling.

This year coal prices have risen from $60 a tonne to $160 internationally. India has been the second largest importer of coal after China, at about $16 billion to their $16.7 billion per annum, running neck to neck with Japan in this. But not this year.

After this page break caused by rapacious international coal prices, freight hikes and shipping congestion, India should be headed towards export of coal. This, after meeting all its needs.

A revived Coal India is now producing 600 million tonnes per annum but slated to produce a billion tonnes by 2023-24. Other coal blocks have been auctioned. Commercial production of coal as opposed to the UPA era ‘captive’ mining handed out to industrial groups has been introduced.

Are there any real alternatives to coal?  Alternate energy sources including hydroelectric, solar, biomass, nuclear-both Uranium based with its erratic supply, and the as yet non-player Thorium, have not done very much.  Then there are wind, wave, gas, petroleum, and who knows, hydrogen in the future.

For now, plentiful coal might be the main player for years yet.  At present it provides 70% of the thermal based electricity, with all the other contenders put together accounting for no more than 30%.

India has the largest reserves of Thorium in the world, but has not been able to develop a workable Thorium based reactor to produce electricity.

It may be political to create a fuss over perceived  coal shortages just as there was a real one for oxygen during the second wave last year. There may be some blackouts, and load-shedding power cuts have already begun in some states. But it is a crisis of our own making at best, and headed swiftly towards a solution. But having said that, it is another misinformation gambit aimed at a 2022 election scenario that is not going to fly.

  (990 words)

October 14^th, 2021

For: Firstpost

Gautam Mukherjee

 

China’s Titanic Moment Approaches

Cameron’s 1997 blockbuster remake of Titanic showed that it lacked an adequate supply of binoculars, let alone lifeboats. Not only was it going at full speed in Arctic waters when disaster struck, but the Crow’s Nest was relying on naked eyesight in the dark. Icebergs are white. Otherwise, the Titanic may not have even got the couple of hours evacuation time it did.

First Class was sumptuous on its maiden voyage. It had a number of ‘name’ American millionaires and heirs to substantial fortunes making the Atlantic crossing back to New York. In 1912, people did not speak of billions and trillions in Washington and Beijing alike.

 It also had the film’s heroine Rose and her mother on the secret brink of poverty. Rose had to make up to her rich and arrogant beau, also on board, because her mother reminded her, it was their last hope to stay amongst the privileged.

Of course, Rose fell in love, despite her parlous circumstances, with a heroic and talented painter from Steerage Class. But that, for today, is another story.

President Xi Jinping and the CCP are approaching their Titanic moment. Overconfidence in Communist social engineering is provoking a course correction that is as doomed as not doing anything. Xi says he is fed up of debt-fuelled capitalist style prosperity. It has created vast inequalities and deviated from the path of the founding father of Red China, the always serviceable Chairman Mao.

 That he has come to this personal eureka moment coincidentally when the dragon’s ecosystem is sputtering into stoppage and decline is perhaps not good news. His room to manoeuvre is severely limited. Thinking of Moral Hazard and catching hold of scapegoats after the excesses (and received benefits) of rapid GDP growth, is fraught with danger. When America let 1,000 banks fail in 1929, it led to a decade- long Great Depression. Barack Obama paid his way out of a similar crisis in 2008.

The Chinese may not have had political freedom from the establishment of Mao, and the expulsion of Chiang Kai Shek, but they have grown very prosperous, albeit in certain pockets, over the years since 1980. Can Xi Jinping snatch this away without grave political consequences? Is he, on the other hand, just trying to make a virtue of necessity like Rose’s mother?

President-for-life Xi is trying to deflect the blame away from himself and the CCP towards the actual hands-on engine drivers. The Engine Drivers - Evergrande’s owners, who owe $300 billion they can’t pay, Jack Ma of the ANT Group who has been forced to lose $100 billion, Local Government Mayors who have accumulated over $ 8 trillion in debt, other tech biggies, manufacturers, exporters, conspicuous consumers, and their Rolls Royces. These ‘deviants’ from Mao’s path - and not the Railways themselves. These people, and not Xi and the CCP, must be held responsible for derailments, goes the logic. The owners of the Titanic who were not on board, in order to go down with it, advanced a similar argument in the subsequent enquiries.

 In recent speeches, Xi Jinping said he wants to steer the ship of state towards more equitable waters where disparities between rich and poor are lessened. He wants to go back to Chinese Communist first principles. However, is the iceberg too close to dodge? And are those yet more and more, ice mountains, behind and beside that first one?

It’s not the fudged statistics in the recent World Bank Report on China to show its economic prowess. Not the insatiable cement consumption figures that fuelled the construction boom. In 2004, at a seminar in swish Hong Kong, the Chinese economics professors who spoke said the Chinese banking system was ‘unreal’. Nobody would be able to find it on Judgement Day. That was 17 years ago. Judgement Day, aka the iceberg, still hasn’t loomed into sight less than a mile away, but it could be hidden in yonder mist.

The story is coming apart at the seams now. It’s not only the unused infrastructure at home and abroad. In places like Hanbantota, Sri Lanka, or Venezuela, far away. Neither can pay the bill, to paraphrase am old Cole Porter song that might have been played in  the nightclubs of sophisticated colonial Shanghai. And seizing sub prime property in Pakistan and around the belt and road/ new silk route globe will not pay the bill in a hurry either.

Nevertheless there is a headlong rush, a full speed ahead in the night at work. A French think-tank, its Military School Strategic Research Institute, alludes to Nicolo Machiavelli’s The Prince in its characterisation. It says China once preferred to be loved rather than feared, but this has changed. Now it wishes to coerce.

It has invested billions in international media to finesse its image. It tries to influence foreign elections Moscow style. It liberally uses embargoes, sanctions, tariffs, and controls access to its markets, in an effort to bring other nations to heel commercially.

This report does not refer to the years of espionage responsible for some of China’s biggest technological advances. It has been a master of copyright infringements, theft, retrofitting, rather than greenfield R&D most successful in the West and the US in particular. That is why its equipment often does not work, and nobody, not in dire straits, wants to buy Chinese fighter jets.

Nor does it refer to the massive Chinese government subsidies used to grab export market share in the early days. Later, China did make money, and its costs rose and rose. This proved a boon for Vietnam and Bangladesh if not for slow, ponderous India.

When the borrow and spend Western bubble burst in 2008, the beginning of China’s export decline was scripted. There was no market like in the old days.

The Chinese economic myth-making was becoming visible.  The woods of apartments in ghost cities in the Chinese hinterland just to boost the GDP. More dams built and being built than a school of beavers could justify. Highways to nowhere.

The myth-making was also an international propaganda machine that captured the UN. UNESCO, WHO, The Human Rights Commission, the UNSC. The lack of progress on the WHO investigation on the origin of the Wuhan Virus is a sell-out to Xi Jinping. The ineffective vaccine Sinevac. The casualty figures suppressed in Wuhan had the crematoriums working 24x7 for more than six months. Was it a man-made virus? Was it deliberately spread by the Chinese, killing nearly 7 million people worldwide so far?

Europe, certainly EU leader Germany, and also France, are beholden to Chinese commerce. So is America. Only Australia has had the courage to break free despite massive economic losses. India has reacted too, in its quiet muted fashion. Chinese 5G is out. Many other opportunities have also been denied.

Its hard to determine Chinese statistics from the outside. Is the currency  overvalued given its massive external and internal debt?  The Local Government domestic debt being half (52%) of its current GDP at $ 8.2 trillion is an informed estimate from Goldman Sachs and the Rhodium Group. China itself does not release Local Government debt figures.

For as long as possible, Xi Jinping and the CCP will keep the veil  drawn over its financial affairs. The electricity is failing. Factories cannot function. Orders are unfulfilled. Scams are being unearthed. The ports are in chaos. Homes are in the dark. Unemployment is getting out of hand. Shortages are mushrooming. The public is risking protests.  The military does not want to fight. Friends of China are leaving the table. Outside adverse comment is growing exponentially. The iceberg will not be denied.

(1,272 words)

For; Sirfnews

September 30^th, 2021

Gautam Mukherjee

 

 

The Gunga Din Syndrome Is Gone At Last

Of all them blackfaced crew/The finest man I knew/Was our regimental bishti, Gunga Din – Rudyard Kipling

 

As Prime Minister Narendra Modi heads towards Washington and New York for the first time since 2019, the European end of NATO is examining its options. The sudden Anglo-Saxon unilateral military alliance between the US, Australia and the UK, has rattled the chains of not only France, but the EU as a whole.

France has lost a troubled if massive $ 90 billion contract for conventional submarines, without warning. It is nothing short of furious. President Joe Biden, whom nobody expected to be quite so decisive during his campaign, has followed through on President’s Trump’s complaints against the European NATO partners. They haven’t been ponying up their share of the costs, nor showing the strategic commitment that this post WWII military alliance demands.

France and Australia have been conflicted on the much delayed and cost escalated deal for some years, but the key change is that Australia has just gone nuclear with US help, nods towards non-proliferation notwithstanding.

China is worried, perhaps for the first time, with America moving into Australia with its nuclear weapons on land, sea and air more or less on an immediate basis. Nobody is waiting to actually build the nuclear attack submarines at Adelaide which will take a decade for the appearance of the first one. China has 50 conventional and 10 nuclear submarines. But these numbers are no longer daunting.

India is likely to gain economically from the shifting of a number of American manufacturing enterprises to India from China as this squaring off escalates. It will also be able to buy military technology and hardware it needs from the US as an important partner of the QUAD. It will gain from Japan and Australia as well on similar lines. AUKUS may prove to be a general benefit in the Indian Ocean and the Pacific to those in the QUAD. Others are welcome to be camp followers. There is the UK beyond the AUKUS deal, in Diego Garcia and with its aircraft carrier group in the Asia-Pacific. France in the Indian Ocean. Germany in the South China Sea. Littoral states such as Vietnam, Singapore. All of them are in a sense QUAD plus.

At the same time, India needs to ramp up its own economic and military strength by bilateral cooperation with multiple countries. After all, the old order is changing, and India is well placed comparatively, without any bones of contention with any of the players except China and Pakistan. Beyond the hectic bilateral meetings and those with American company heads, India would do well at the UN to stick to its tried and tested messages against international terrorism and broad-based cooperation on climate change. Bland is good to negotiate through these sensitive times.

The Modi government knows there is much to be gained in a multipolar universe. It offers sovereign autonomy and freedom of choice. However,if we are pressured to toe any American line in our region or country, pragmatism dictates we need to be well compensated for it both strategically and economically. But to say no may not be wise, with China watching for any rift. Australia and the UK have happily embraced their supporting roles in AUKUS. Like Australia, India needs a lot more military equipment than it can readily buy or manufacture in short order. Again, China is relentlessly building up strength on our borders all along the LaC and via Pakistan as well. Russia cannot really help in this, because as a smaller economy, it has its limitations and is dependent on China to an extent. If India as a member of the QUAD with imminent threats from China, is presented with American military teeth, provided India supplies the bases, it must not hesitate.

Looking at the past can be educational. Non-alignment was meant to be a post-colonial equidistancing from the then power blocks of the Capitalist West and Communist Soviet Russia. It degenerated swiftly into all the newly independent countries adopting both Socialism and the USSR as Godfather.

This arrangement apparently gave the have-not nations a voice in the UNGA and a certain dignity to poverty. It was axiomatic that the poor countries could not survive without the help of a big brother. The benefactor, in turn, subordinated these satellites in large ways and small, and expected their unflinching support in foreign policy, big buying decisions, and value systems.

For India, this hollow form of non-alignment lasted nearly fifty years. Nobody has quite removed the obsolete name-plate as yet. We talk of national interest and multipolarity these days.This is because we no longer accept aid and have grown into one of the top ten economies of the world.

But in the old days, due to our British colonial hangover and Nehru’s penchant for imported conceptions under the surface Gandhianism, we became part of the Commonwealth - a kind of non-military QUAD of its time. We continue with this example of subservient Gunga-Din diplomacy. Even as it too has declined along with the fortunes of the United Kingdom, little more than a US satellite itself.

Of course, Socialist India also needed British Aid and grants in the early years. The Commonwealth Games extant to this day, are fun, though they are really also reminders of the extent of the imperial British Empire at its zenith. 

During our active non-alignment years, made a nonsense of as we held hands with the likes of Marshal Tito of then Yugoslavia, Gamel Abdel Nasser of Egypt, and later, Cuban supremo Fidel Castro and Yasser Arafat of the Palestinian Authority.

We were laughed at for our posturing and hectoring at the UNGA by the prosperous and technologically superior West. But, that wasn’t the half of it. India had to endure many humiliations from both sides of the see-saw.

The USSR kept India on its leash with bribery, flattery, while  infiltrating Indian politics and policy-making using the KGB. They sold us second level armaments no longer used by the Soviet armed forces. They permitted us our rupee payments and barter as we persisted with 2% or less rates of GDP growth. Today, we still buy Russian armaments because 50% of our in situ equipment comes from there, but we get much better terms. Including JVs such as the one that has produced the universally respected Brahmos missile. A grown economy on its way to become the world’s third biggest, is putting the erstwhile bishti in the driver’s seat. 

We had to turn to America for food grains and milk in the early decades, donated under their PL-480 programme. This went on till the 1960s and even later till the Green and White Revolutions despite distribution bottlenecks and primitive storage conditions that persist to this day.

But our mateyness with the newly liberated Socialist or Communist countries, our dislike of imperialism, plus that unworkable non-alignment, clearly harmed us. We refused to accept Nepal and Balochistan into our fold. We didn’t take the proffered UNSC seat from President John F Kennedy, or his offer to turn India a nuclear weapons power before China.

Instead, we gave away both opportunities to China. China went nuclear in 1964 itself.  A couple of years before that, Mao’s China came at us in NEFA, took over the Karakoram Pass, large tracts of Akshai Chin, and all of Tibet. We ended up providing refugee status to the Dalai Lama and lakhs of his followers as a gesture.

Early independent India had no idea of realpolitik. Ironically, we forgot all about non-alignment when Nehru begged America in panic to attack China for us. Kennedy didn’t, but forced China to give back seized Indian territory to an extent.

The Soviets didn’t come into all this, but years later rival block pressures, with China added to the mix, persist. Russia, the successor, was forced by America to deny us its cyrogenic technology for rockets. Israel’s dealings with China sometimes get in the way of its posture towards India.

Going with the power blocks however used to hurt much more when India was poor. Pakistan was the out-and-out US ally, and India was hyphenated with it, till the disparity between our economies became too large to ignore. By then the Soviet Union was gone but Russia, with a much smaller economy, is not free of pressures.

Pakistan wasn’t so essential, once the US managed to oust the Soviets from Afghanistan. Now Afghanistan too is gone from the US equation.

In the heyday of non-alignment, India needed development money, soft, long-term loans, aid, grants. And this came via institutions controlled by the West- the World Bank, the IMF, the ADB. The Soviets couldn’t help in this regard, being hard up behind their ‘Iron Curtain’ themselves.

Coming back to the Prime Minister’s US visit, it is reassuring that India will be seen as a power on its own. Buying armaments from Russia continuing, no longer defines us. We buy significant value from the US, France and Israel as well. India has begun exporting its military equipment starting with excellent bullet proof vests and coast guard boats and frigates for the navy. Missiles might be next. Gunga Din can rest from his labours at last.

(1,532 words)

For: Sirfnews

September 22^nd, 2021

Gautam Mukherjee

 

A Richer India Will Be A Safer India

Money, money money/Always sunny/ In the rich man’s world- ABBA

The aspirational aspects unleashed by the Modi government from the start, need  large funding. More so, because the approach is holistic and spread over all sectors. All being awakened to their potential, perhaps for the first time.  We have stopped calling ourselves poor, as if to excuse all shortcomings. There is massive welfarism still, but it has been shorn of corruption and has developed a reformist sheen. However, ‘povertarianism’ as a pornographic Marxist glory is gone.

Today there is every attempt to try and balance the books. Revenue generation is important. That is why the NHAI, furiously building expensive and world class highways,targets income from tolls to rise from Rs. 40,000 crores to 1.5 million crores a year.

What we must aim at though, is surplus revenue in all our productive endeavours, that can be directed in any direction necessary.

And the best money, as ‘borrow and spend’ disasters from across the world remind us, is earned money. So far, seven years in, the GDP is far less than in the Vajpayee years. But public spending on modernisation, infrastructure, welfare, the military machine, the railways, ports, airports, education, health, culture, has blossomed. These things, essentially investments, have a way of paying handsomely in the medium term.

There is a steady increase in Foreign Direct Investment (FDI). But we need the Chinese rate of growth of the three decades from 1980. Fuelled, not so much by exports as theirs was, but pumped up domestic demand.  Exports today are hampered by low growth in the buyer countries and pressure on margins.

Still, lateral shifts of manufacturing are promising. The opportunity from global disenchantment with China can do much for us if we work with a will.

A sharpening bipolarity between America and China is now an established reality. As they duke it out, the challenger China, has subverted or ignored most existing institutional mechanisms, the UN, G7, G20, many other fora, various protocols and agreements, international law.

China, particularly with regard to the East and South China Sea, various territorial and boundary disputes in its vicinity, says I don’t accept international laws and positions. It seeks, further to dominate the world with forward military bases and a growing blue water navy supported by its other military arms. Till recently, it was proud of its ‘wolf warrior’ diplomacy to counter all objections though this is somewhat muted post-covid.

America under Biden has been surprisingly decisive too. It has already removed missiles from Saudi Arabia, pulled out of Afghanistan, and turned Australia into its forward base in the Pacific looking squarely at China.

India’s own gradual ascendancy into a leading economy has sharpened rivalries. There are serious military threats from China and Pakistan and fomented internal security concerns. These are making fresh demands on its purse that cannot wait.

The march to a $5 trillion economy has become urgent. This, not only to lift most Indians towards first world levels of prosperity and well-being, but to keep the country safe.

Post Covid, or the most of it, as we approach the end of 2021, the Modi government seems determined to aim for double-digit growth in 2022. 

In preparation, a series of economic reforms have been unfolding. The bold step of the three new farm laws have started yielding good results.

The long-awaited repeal of the retrospective taxation that hit oil player Cairn and telecom’s Vodafone has taken place. In the aftermath, reforms to financially unburden the telecom sector have been so practical and dramatic that a near collapse has turned into green shoot optimism.

The much postponed bad banks have come, even as the non-performing assets ballooned to Rupees ten lakh crores. Some three to four lakh crores of it, mainly due to badly structured infrastructure loans, have happily been recovered by the lender banks themselves. The rest may involve partial recovery from asset-light borrowers. But all of it leaves the books of the high street private and PSU banks, some of which have changed ownership or been merged. This sets up a new lending cycle towards better results in the near future.

Exports, supported by government incentives and facilitation, have shown a great upswing of late -rice, mobile phones, vehicles, bullet-proof vests, software, data storage, components, engines, textiles, other raw materials and finished goods. We are emerging as the pharmacy to the world as the multiplicity of India made vaccines for Covid-19 have demonstrated. There is a lot of money in this area too.

Breaking through the tentacles of a powerful import lobby in military procurement, a host of joint ventures in the armaments space are gaining momentum. There are others, involving making parts of civil and military aircraft for US and European majors. 

The replacement for the superannuated Avros, with Airbus transports, will, for the most part be made by the Tata Group in JV here. Air India too is about to be privatised at long last and returned to the Tata Group.

The second generation Mk2 Tejas programme for single engine fighter jets, has been boosted with orders for 83 from the Air Force and the acquisition of 100 GE Aviation engines.

DRDO too has gone in for a JV with Rolls Royce in addition for the manufacture of a wide range of aircraft engines. India has also developed 1500 Hp and 750 Hp turbo-charged engines for its Main Battle Tank and Armoured Carriers. Ammunition manufacture has been reorganised in order to get out of the clutches of Communist trade unions that have engineered go-slows and man-made blockages for long.

A lot of the military manufacturing initiatives are achieving the dual objectives of becoming cost efficiently atmanirbhar while bypassing the rigmarole of technology go-slows and embargoes from the military export majors. This is very important in an every-country-for-itself atmosphere prevailing.

The armed forces are being structurally reorganised to form more integrated fighting groups involving all three services. A new Rocket management corps is on the anvil. Space warring capabilities are being developed. High altitude warfare battalions have been raised. There is increased recognition of the changing face of modern warfare.

This involves digital process, drones, armed drones, robotics, missile deployment, stealth technology, electronic and satellite surveillance,  space wars, missile shields, cyber warfare.

On ‘Civvy Street’ LIC is going in for a mammoth IPO, even as the Indian stock market is booming as a show of confidence in the future. A plethora of start-ups are not only accessing mega funds on the stock market but have put India in the top echelons of the global start up ecosphere.

The Chinese debt crisis is now spilling out into the open with the Evergrande real estate group with over $300 billion owed is trying to barter its way out on the point of default. Analysts have long predicted that the mountain of debt that fuelled Chinese growth, as indeed it did the American boom years, is not sustainable. The difference is that the US has the confidence of the world behind it but China does not.

Though China will do everything possible to control the financial and social fallout, it will still be highly preoccupied with containing the damage. Abroad, the Chinese getting paid in seized assets in sub-prime countries is also far from good enough.

India has a good chance to catch up. This will be assisted by the constitution of the QUAD and other outside followers of the same script such as France, Britain, Singapore, Vietnam, and probably, even Russia.

With a 67% approval rating in a recent CNX survey, the present Modi government is still overwhelmingly popular. It should therefore not only win most of the assembly elections including UP in 2022, but also the general election in 2024. Assuming the NDA gain another majority, they can implement their nationalist economic agenda till 2029 at least. And a fifteen-year run tends to ensure a further continuance as the opposition dies of political starvation.

Side by side we must continue making large gains in diplomacy, foreign affairs, manufacturing, robotics, cyber software, start-ups, modern high-yield agriculture, preventive medicine, cutting edge technology. High year on year growth will end our days of playing Gunga-Din, the water bearer – meeting the thirst of the developed world. A prosperous, modern, responsible, civilisationally-gifted India is to be our identity in the future. It is our duty to realise this and work towards it.

(1,395 words)

For: The Sunday Guardian

September 20^th, 2021

Gautam Mukherjee