16 December 2007

“The Kaoboys of RAW” by B Raman & “India’s external intelligence” by VK Singh

How secretive should sleuths be?

Secretive enough to not let our strategies become public domain information for adverse interests; yet not so secretive to escape public scrutiny completely.

At last some of our sleuths have started publishing books about their life and times in RAW.

Raman does not succumb to the temptation of spilling secrets.

He provides the insightful analysis one can expect from him:

(a) There are no friends or enemies amongst sleuths. Strategic interests dominate everything else. CIA was wary of Indian sleuths helping Soviets in Afghanistan and kept them busy by supporting the Khalistan movement. (Friendship between Kao and then CIA director George Bush changed this policy). CIA was happy to train ISI on terrorism in foreign lands (mainly directed against Soviets). Yet CIA was happy to train RAW/IB on counter –terrorism. French intelligence penetrated Prime Minister’s office and gained access to RAW briefings. Yet French intelligence was happy to co-operate with India and provide US/Soviet fleet movements in Indian Ocean. PM Narasimha Rao summed it up nicely when he said (in a reference to US): “We have to get along well with them; but we have to be careful with them!”

(b) Pakistan’s divisive actions in India did not stem from the loss of East Pakistan as Bangladesh. It started as early as 1956 when Naga rebels crossed over to Burma to get trained in rebellion. (The rebels’ dream of a Greater Nagaland, including bits of Burma, led to Burma turning hostile and stopping this). Pakistan helped Mizo rebel Laldenga conduct a campaign from Pakistan for Mizo separatism. (Laldenga began to dislike to his ISI handlers and made a deal with RAW to move to India). Pakistan provided honor and support to Dr Jagjit Singh Chauhan and helped him conduct his Khalistan movement even prior to the 1971 war. Pakistan found a greater success in Kashmir because of:

1. Availability of 80,000 trained and armed mujahideens free after the Afghan war to conduct a proxy war against India

2. Benazir Bhutto’s stepped up support to ISI (with unlimited power and required funds) to conduct the proxy war. (Pakistan’s relationship with India was at its worst when Benazir headed Pakistan. No meetings. No discussions on “non-white papers”. No initiatives).

3. Prime Minister Rajiv Gandhi’s trust in Benazir Bhutto (for which, according to Raman, Prime Minister V P Singh had to pay the price eventually) and

4. Prime Minister I K Gujral’s decision to discontinue RAW’s covert action capabilities on Pakistan’s western border (a policy started by Indira Gandhi and supported by every Prime Minister after her until 1996) that freed ISI to focus on the eastern border at Kashmir and

5. Failure by New Delhi to stop the alienation of Kashmir Muslims (unlike the successful stopping of the alienation of Sikhs in Punjab thanks to several leaders amongst the valiant Sikhs themselves).

(c) Raman thinks that the Bangladesh war did not provide India strategic advantages. We ended up having a nuclear armed Pakistan and an ill-disposed Bangladesh in the neighborhood. Worth pondering this thought. Nor does he think the win against Soviets provided US any strategic advantage. Raman is convinced that “if ever there is an attack in US soil using a weapon of mass destruction, it would have originated from Pakistan”. Worth pondering this thought as well.

(d) Raman accuses both ISI and IB of ill-treating suspected sleuths from across the border. He avers that ISI’s suspicion that RAW had a hand in the Sindh disturbances is misplaced. According to him, this was Pakistan stewing in its own sectarian juice.

(e) Some interesting behavior “behind the scenes”:

1. Prime Minister Chandrasekar secretly agreed to refuel US aircrafts proceeding to the Gulf war theater in 1990; but backed off when a newspaper broke the story

2. Prime Minister Indira Gandhi, after a massive rejection of her “emergency” rule in the 1977 elections, considered sending Rajiv and Sanjay Gandhi out of India and gave up the idea at Kao’s advice.

3. Several bureaucrats had fallen prey to money, alcohol and sexual companionship to compromise security or not return to India.

Raman’s book clearly brings out the stellar role Kao’s men played in serving India’s territorial integrity and geopolitical interests.

Organizing the nation’s sleuths (blending the plays abroad, the plays within the country, using people, using technology, warding off others’ spies, working with military intelligence, working with India’s diplomats abroad, working with others’ diplomats in India), steering through the political power play in New Delhi and staying above suspicion are big challenges.

However, India is always able to get good leaders at political level, good leaders at institutional level (like Kao) and good workers at the field level (like Raman). Let wisdom prevail over interests and transparency prevail over power in organizing our intelligence forces.

V K Singh on the other hand is disappointing. He is rightly offended by the corruption (that arises from lack of public scrutiny), nepotism and factionalism. However, his book is a laundry list of “dirty linen”. Apart from putting to shame the offenders (which is not a bad objective really), the book does not provide any “secret” of the RAW or an insight into “India’s external intelligence” as the cover claims. Waste of time. Funny the Government should waste time and tax payers’ money in attempting to remove this book from the shelves!

08 August 2007

"Battle at Kruger" by David Budzinski and Jason Schlosberg

You are having a fun vacation in Kruger National Park in South Africa. You brought that videocamera you received as a corporate gift (taking some time to figure out where the record button is) just in case something interesting happens.

Your jeep reaches a serene peaceful watering hole. You see a herd of cape buffalos ambling along from your left. You see a small pride of lions on the right. The lions are crouching forward. The buffalos sense and run for their lives. A calf does not make it and is caught and held by the lions near water. Out of the blue (pun intended) spring a pair of crocodiles trying to take the lunch away from the lions. A battle ensues. The crocodiles give up. The lions are about to settle for a peaceful lunch. The cape buffalos come back with strength and surround the lions. Have you seen a cape buffalo leverage its head to catch and throw a lion into the sky? This time the lions run for their lives. Life is far more precious than lunch in African Savannah. To top it all, the calf has survived the sharp teeth of the lions and the crocodiles. It slowly rises and joins the herd.

You managed to keep the entire thing recorded focusing on the right subject all the time in spite of a mileu of players and a script that no one could have anticiapted.

How would you feel?

David Budzinski was elated and ended up with the most popular viral video that "Disney could not have scripted" thanks to fellow traveller Jason Schlosberg's initiative in putting this on YouTube.

If ever you want to teach someone about the effectiveness of teams, just play this video.

Have fun. Dont miss it.

04 August 2007

"Indian Summer" by Alex von Tunzelmann

Alex von Tunzelmann, student of history at Oxford and editor of OSU’s Cherwell newspaper in 1998, passes this book as “the secret history of the end of an empire”.

“Life and times of Mountbattens in India” would have been a more apt title. The book contains no secret and is not about the end of the empire in entirety.

The book places too much importance on the roles of three individuals: Mountbatten, his wife Edwina and Nehru. The long struggle, mostly non violent, to evict an alien rule by a wide and deep political leadership (some meriting reverence for decades after their death) has been trivialized to a vane member of British royal family sent to unwind the empire; his flirting wife and an equally flirting visionary who led India during and after the transition.

However, one must compliment Alex von Tunzelmann for the sheer objectivity she brings into describing the events in the last days of the Raj.

Alex starts with a funny perspective: There were two countries in 1577. One was a vast, mighty and magnificent empire, brilliantly organized and culturally unified, which dominated a massive swathe of the earth; and the other was an underdeveloped semi-feudal realm, riven by religious factionalism and barely able to feed its masses. Guess what! The first is India and the second is England. In 1857 it was the other way about! Now you know what alien rule does to the ruler and the ruled!

However, a country divided by religion, divided by tribe, divided by caste; a society whose equilibrium derives from repulsion and exclusiveness is, as Karl Marx rightly observed, predestined to be a prey of conquest.

Did Britain rule India in discharge of “the white man’s burden”? Not really. The Prince of Wales, visiting India in 1921, found the princely states far better than British India! Quite a royal endorsement against the inept colonial rule that kept the GDP stagnating for over 70 years at the time of this observation!

Is the British attitude toward India patronizingly affectionate as reflected by Edwina’s kindly love for Nehru? Not really. Winston Churchill astonished everyone in a dinner party by suggesting that he would have “Gandhi bound hand and foot at the gates of Delhi and let the Viceroy sit on the back of a giant elephant and trample the Mahatma into the dirt”! This reflects the kind of thinking that political leadership in India had to face! (Oh yes, I found one opinion I share with Churchill: Gandhi is a Mahatma!)

Did Mountbatten handle his role reasonably well? Mostly no; occasionally yes.

(a) In mid July 1947, while negotiations about partition, defence, finance, future of princely states and the future of 400 million people raged around him, Viceroy Mountbatten was “busy fussing about flags” seeking Union Jack in the upper canton of the flags of India and Pakistan!

(b) Ten days before independence, in the midst of the violence in Punjab, Mountbatten bothered Nehru with a list of dates upon which the Union Jack might continue to be flown in India after independence!

(c) However, he deserves some praise. In less than one year, Patel and Mountbatten achieved a larger and more closely integrated India than what had been achieved in 130 years of Mauryan rule, 180 years of Mughal empire or 90 years of British Raj.

Alex steers clear of bias in her book to an admirable extent.

One reason why, I would recommend a reading of her chapter on Kashmir.

29 July 2007

"India after Gandhi" by Ramachandra Guha

Ramachandra Guha, Stanford/Yale professor turned writer, has done an outstanding job covering the history of India since 1947. The book is very engaging and informative. If you want to understand the evolution of modern India, you ought to read this book.

India’s journey in the last sixty years could be described as a journey between two books: from Katherine Mayo’s “Mother India” (dismissed by Mahatma Gandhi as a drain inspector’s report) to Thomas Friedman’s “The World is flat” (with adulations about a confident and growing economy).

The journey has several good and bad milestones:

(a) Good news: The country dealt with the messy partition – a great human tragedy that displaced 8 million people. Handling the bi-directional migration in Punjab was easier than the uni-directional immigration in Bengal.

(b) Good news: India, the political entity was created by unifying the various bits of the jigsaw puzzle left behind by the British; a country that the nation never had in several thousand years of history .

(c) Good news: A style of government based on rule of law, secular principles and a stable constitution was fashioned. A constitution based on liberty, democracy, emancipation and equality was created. Democracy has been the biggest strength of India in the last 60 years.

(d) Good news: The country was re-organized into linguistic states. Linguistic bonding created strong states under a federal structure and is one of the reasons why democracy has had a deep rooted existence in India.

(e) Good news: Nehru set in place political sensitivity that a heterogeneous population requires to hold the country together. Muslims in India went on to play a great role in India.

(f) Good news: Nehru laid the foundation for democratic traditions by conducting general elections every five years by universal adult franchise. Popular mandate dictated public policy and politics. Transfer of government from one administration to another was civilized.

(g) Good news: The Hindu personal code was reformed and standardized; a true revolt against the oppressive features of the Hindu society. Nehru/Ambedkar achieved in 17 years what could not be achieved in the preceding 1,700 years.

(h) Bad news: Nehru empathized with but desisted from reforming Muslim code; he preferred to leave it for a later day and to Muslim leadership. The Supreme Court judgment in Shah Bano case offered an opportunity. Muslim leadership was in support of this reform. However, Rajiv Gandhi, fearing electoral defeat, reversed the judgment by legislation in spite of the protest and resignation of his Muslim minister Arif Mohammed Khan.

(i) Good news: India got the ruler of Kashmir to sign on to join India when Pakistan sent “trained insurgents” to take Kashmir by force. Nehru got the popular Muslim leader Sheikh Abdullah to support accession to India. Nehru held general elections in Kashmir to ensure governments in Kashmir were backed by popular mandate.

(j) Bad news: Democratic principles and civil liberty were severely challenged by Indira Gandhi.

1 Constitutional rights and civil liberty were suspended for two years. However, these were restored by a wiser government that followed.

2 Political leadership in opposition was imprisoned but opposition leadership rose to the challenge; and the electorate rejected Indira’s actions by voting her out; her defeat was near total.

3 Political leadership in Congress party itself was weakened; inner party democracy weakened and power shifted to a coterie of advisors and members of the family. The party is yet to recover from this; however, the weakening of the Congress party has strengthened Indian democracy. Since 1989 no party has been able to form government on its own and coalition governments have come to stay widening and deepening democracy but rendering public policy slightly incoherent.

4 Political leadership at state level was weakened; and nominees of “high command” were “elected” by obedient legislatures to power as Chief Ministers. However, strong leaders like N T Rama Rao rose to protect “Teluguwala gopatnamu” and brought back pride to leadership at state level.

5 Government executives were pressured to be “committed” to political agenda (instead of being neutral in a multiparty democracy). Government executives were too glad to co-operate and several of them have turned to political careers after retirement.

6 Judiciary was pressured to be “committed” to political agenda. Though there have been a few instances of favored promotions, the Judiciary has substantially held its independence.

7 Gag rules were enforced on press for two years by Indira Gandhi. Rajiv Gandhi attempted, in response to stories of corruption, legislation to jail editors for “scurrilous publication”. Fortunately protests in Parliament prevented the legislation.

(k) Bad news: Corruption became endemic in the system. State’s control over economic assets, and State’s leverage over private enterprise were enhanced ostensibly to fight the rich on behalf of the poor; but with a more obvious consequence of decision-makers in government being able to convert their influence over the direction and timeliness of the decisions into personal or political wealth.

(l) Bad news: India saw two pogroms. Against Sikhs in Delhi in 1984. Against Muslims in Gujarat in 2002. Both arose due to willed breakdown of law. The PM in Delhi and the CM in Gujarat issued graceless statements that in effect justified the killings. Very unfortunately both reaped electoral rewards.

(m) Bad news: Rising Religious fundamentalism, by Hindus and Muslims, affected peaceful co-existence. A sixteenth century mosque around a Hindu sacred site has been a trigger for religious divide in India for long. Destruction of the mosque by Hindu fundamentalists stepped up the divide. Mahatma Gandhi’s advice to a pluralistic society to not seek benefits for the maximum; but maximize benefits for all was sadly forgotten.

(n) Good news: Backward castes who benefited economically from land reforms have started asserting themselves politically (Karunanidhi, Mulayam Singh Yadav and Laloo Prasad Yadav). Dalits found new leadership in Kanshi Ram and Mayawati. Increasing political assertiveness would influence the differences to vanish in the long run.

(o) Bad news: Territorial integrity of India saw a few challenges that stemmed from:

1 Departing British rulers encouraging princely states and hill tribes to remain independent and have a dominion status with Britain so that the empire survives the Raj. Churchill’s support to Hyderabad and Nagaland are examples.

2 Political insensitivity of federal government to the pride, claim to common resources, border or leadership as in the case of Punjab

3 Pakistan’s agenda to avenge the loss of Bangladesh by supporting religious divide and sponsoring terrorism.

4 Kashmir.

(p) Bad news: The economy was mismanaged for first 35 years and is dogged by a “blow hot blow cold” view for next 25 years.

1 Indian economy, second largest in the world from time immemorial to 18th century stagnated with zero growth from 1857 to 1947 thanks to inept British rule.

2 The young nation pursued socialism (centralized planning, state ownership of big ticket industry, state control over private enterprise etc) for two reasons: Nehru truly believed in it; Indira Gandhi saw an opportunity in it to get defined as pro-poor and win elections. End result: Economy grew at a stately pace of 3.5% pa for the first 35 years.

3 The mid sixties famine was a shock to India. However, the “green revolution” helped India achieve self sufficiency in food production. Wheat production doubled. Rice production grew 50%.

4 Rajiv Gandhi started with right ideas by liberalizing trade, reducing duties, incenting exporters, simplifying license regime, lifting curbs on businesses and reducing tax rates; but reverted to populism closer to election time. (He did not win, however).

5 The 1987 drought affected 200 million people and entailed a few starvation deaths.

(q) Good news: A severe economic crisis forced politics to take back seat and introduce economic reforms in India that pushed India into a growth path.

1 The coalition governments inherited a crisis and had to take “significant” steps in opening up the economy, inviting foreign investment, and liberalizing trade.

2 However, there is a continuing debate between “reformers” and “populists”.

3 Economy is growing at a faster 6-8% in the last ten years.

4 There were success stories. The software service exports, aided by Nehru’s education system and linguistic policy, Rajiv’s emphasis on telecommunication and George Fernandes expulsion of IBM giving rise to indigenous players, grew from $ 0.1 billion in 1990 to $ 13.0 billion in 2004.

We have today a confident and rapidly growing India; well integrated with global markets for goods/services and capital. Democracy has taken a deeper root and some tradition in the country. Several malaises prevail and pose challenges.

Will India survive?

So long as the democractic traditions remain, secularism prevails, citizens remain free, market is respected and civil service/army remain; and Hindi film songs are sung, India will survive” says Guha.

Let me add my contribution to India with a Hindi film song: "so jo kabi aisa ho to kya ho?"

Just dont miss the book. If possible recommend the book to a young Indian.

13 July 2007

"Criminal" directed by Gregory Jacobs

This 2004 movie is a remake in English of “Nueve Reinas” (Nine Queens) the Argentinian heist movie written and directed by Fabian Bielinsky.

The movie is unique amongst heist flicks. A senior con artist and his understudy start the day in sunny Los Angeles with small time operations. The unfolding day gives them an opportunity to do a big ticket scam on a rich “mark”. A series of characters (not one of them honest) and rapid turn of events pose several challenges.

The movie grabs your attention right at start and holds it firm right to the end. The movie progresses along predictable lines for a brief while; and then it takes you on an unpredictable roller coaster ride.

Don’t miss it. Have fun.

01 July 2007

"Confessions of a Swadeshi reformer" by Yashwant Sinha

The book is indeed written by a “reformer”; am not sure this is however a “confession”.

Yashwant Sinha is one of the unsung heroes in the history of India’s economic reforms.

After 24 years in civil service as an IAS officer, Sinha switched to politics in 1984. He had two short spells as Finance Minister; in both instances the governments were brought down by moral low points of Congress party. In the first instance, the Chandrasekar administration (supported by Congress from outside) was brought down by Congress ostensibly because two sleuths were spying on Rajiv Gandhi. In the second instance, Gomango, a Congress MP who had taken office as CM of a State (and therefore was morally obliged to resign from Parliament) voted to bring down Vajpayee government by a wafer thin margin of one vote. Sinha came back as Finance Minister when Vajpayee formed his second government after winning elections; and went on to become the fourth man to present five budgets.

Sinha inherited an insolvent economy the first time; and had to pledge 20 tonnes of SBI’s gold with the Bank of England to get $ 400 million foreign exchange to tide over the crisis. He did not flinch in making hard decisions in spite of the negative popularity that would entail. Sinha swore to himself that he would not let that happen again. Sinha prepared, as per Dr Arjun Sengupta, an eminent economist, a truly revolutionary budget after the crisis; but was unable to present it because the government fell. Otherwise, it would have been Sinha, and not Dr Manmohan Singh, who would have become the poster boy of economic reforms.

The five budgets that Sinha was able to present later did not, unfortunately, have the same revolutionary edge.

The book however is certainly not a “confession”. There is nothing in the book that was private prior to disclosure and nothing that is sensational that would give a different perspective to the reader.

The book is still a good read because this is a reasonably honest account of a hero who thought more about strategic wins than immediate popularity. The alleged statement of Jana Krishnamurthy when he listened to Sinha’s economic agenda sums up Sinha’s philosophy: “It is good to implement your agenda; but we need to stay in power to implement your agenda. Your agenda may not allow us to remain in power for long”. The true dilemma of a statesman who has to however keep getting elected.

Three disclosures disturb a reader:

(a) Sinha claims that the budgets prepared by several of his predecessors were known ahead of turn to an industrial group.

(b) “Someone” close to PM Vajpayee’s office called Sinha to direct him to reduce tax on a product (that would have been useful to an industrial group). Sinha checked with the PM. No such directions were given. Sinha did not comply with the request. Sinha does not name the person who conveyed the alleged directive. The reader can understand Sinha’s reluctance since he is continuing to be in politics. But the book is not yet a “confession”. It would become one when Sinha is ready to name the person and get him/her out of politics.

(c) Chief Minister Jayalalitha slipped a note (listing all the income-tax disputes and cases Sinha's Finance ministry had with Jayalalitha) to Sinha after a lunch Sinha had with Jayalalitha in her home. Sinha claims he did not act on the note. If she indeed gave a note as Sinha claims, that is a low point in Jayalalitha’s political career!

Sinha is one of my favourite politicians in India. He had the moral timber to resign at the whiff of a suggestion of involvement in a havala case that was orchestrated by wily Narasimha rao. He did not contest elections until he was cleared by courts. He did not do a piggy back ride on a party. He won elections in Bihar each time he played a role in the government. He was a true reformer with a vision that went beyond the next elections. Above all, he did not strive to bring his children into politics – a clear sign that politics is not of economic advantage to this politician.

20 May 2007

"Dancing with Giants: China, India and the Global Economy" by World Bank

This is a report by the World bank (and a think tank) to study the impact of the growth of China and India on other countries in the World.

Provides a good insight into the China and India story:

(a) Sorry, China and India are not Giants. Though they house 38% of world population they account for 6.4% of World GDP (yes, purchasing power parity is not useful in evaluating your impact on other countries since size of trade and exchange rates are more important than price levels).

(b) Sorry, this will not change even after sustained growth in the next decade. India would grow from being 1.7% of World economy to 2.4% in 2020 (okay, 3.2% if you are optimistic). China would grow from 4.7% now to 7.9%.

(c) Sorry, India is not a dominant player in providing services to the world. India’s export of services is just 1.8% of global trade in services.

(d) Sorry, IT just accounts for 6% of India’s service revenue. Nope, it is a myth to believe growth in IT sector would transform Indian economy. It did not. It may not.

(e) Nope, energy economists don’t need to worry. India accounts for just 3.4% of global oil usage. In the next ten years any hike in oil price is more likely to come from supply side hitches than from increased demand for oil in India or China.

(f) Nope, US current account deficit is not due to China’s import barriers or an undervalued currency. US is just not saving enough.

(g) Nope, China and India are not competing head on for their products. The top 25 exports of China and India have only one product in common! (Yes sire, refined petroleum).

(h) Nope, Dhirubhai Ambani alone is not enough to reform our textiles industry. Our textile exports is $ 10 billion a year. Wal Mart alone buys $ 18 billion textiles from China. Did you know one major impediment is the delivery time from India to US? Yes, 24 days!

(In passing, the economists say that the movie industry in India is not known to produce world class movies; though one did come recently: “Bend it like Beckham”! Apologies Mani Ratnam, economists do not know as much about movies as about GDP!)

Have we handled our economy well? We made some mistakes in the way we managed our economy.

(a) We started with one major disadvantage. Inequality.

(b) Economic growth is rarely balanced. It often results in enhancing inequality.

(c) There are good inequalities (differences in income and wealth because some earned more than others) and bad inequalities (lack of access to education or credit to pursue an economic activity). Good inequalities are necessary to maintain incentive for growth. Bad inequalities prevent people from escaping poverty.

(d) We got our philosophies mixed up. Instead of attempting to eliminate bad inequalities by providing access to opportunities for the poor, we went after good inequalities by suppressing incentive for economic growth.

(e) We restrained firms from freely pursuing economic activity (by reserving several activities for the State or for small enterprises and by introducing a license raj that required government permission to start or expand a business).

(f) We prevented efficient allocation of resources (by protective trade policy that perpetuated advantage to existing players, by a directional tax policy, by state control of all funding and by restrictive labor laws).

(g) On the other hand, we did not provide access to education or market driven micro finance delivery to the poor to acquire human capital to escape poverty.

(h) End result: We did not grow enough; but the inequality went up. The poor did not benefit from economic growth at all.

(i) Since our political system depended on popular support, political administrations “blamed” a variety of targets (businessmen, upper caste, land holders, foreign hands) for the failure to eradicate poverty and used the resultant “popular anger” to consolidate their power base.

(j) Thank God we had a crisis in 1991. Debt service rose to 21% of receipts. Interest burden rose to 20% of expenditure. We ran out of spendable currency. No one was willing to lend.

(k) Prime Minister Narasimha Rao went beyond curing the immediate disease. Rao government cut back industries reserved for State; removed licensing requirements; devalued rupee; allowed current account convertibility; removed quotas and reduced tariffs; and lifted restrictions on foreign investment.

(l) Fortunately the reform process, despite vigorous debate, has developed sufficient consensus to stay on track in succeeding administrations.

(m) We have some more miles to go:
(1) We need to provide access to education and credit to facilitate people escape poverty. Spending money on rural infrastructure alone will not kill “bad inequality”. If this is not done, India would continue to be a miracle of “jobless growth” and political consensus for reform would evaporate diluting growth prospects. Equality is not just a nice thing to do; it is essential for going after growth.
(2) We need to get “government” out of “business” even more. Subsidies will have to reduce. Buredensome state enterprises cannot be funded by public expenditure. Bad loans in banks will have to reduce. Regulatory rigidity in labor market will have to reduce.
(3) We need to step up “governance”. We need to step up government effectiveness and bureaucracy quality.
(4) We need to manage our “balance sheet” well. We cannot be an economy whose liabilities are in “high cost equity” (FDI and portfolio investments) and whose assets are in “low yield reserves”. This asymmetry is expensive.

China has one advantage over us. An early start. China has built a strong manufacturing base with an eye on the global market (40% of its GDP is from exports vs 15% for us). However, in the end, China has one disadvantage. In China the State is determining who will pursue economic activity and who will not by its “hukou” system (license to live in special zones) and “TVE system” (town and village enterprise owned by local governments with limited authority to retain and reinvest super profits). This was useful in creating "private firms" in a socialist economy.However, this past success is going to be a burden for China in the future. A very large population, distinguished by party discretion, got left out in the growth process and resentment is bound to build up. Building political consensus to the reform process is going to be quite a challenge in China. This may hamper growth. To this extent China is in a "trapped transition".

India has a higher chance of sustaining and growing political consensus for reforms because it has the political institutional framework to let differing voices debate vigorously before building consensus. The pace is bound to be slow but the traction is firm.

It is nice to think that Leftist leaders Prakash Karat and Sitaram Yechury, with their wisdom and ability to disagree, play an important role in this long term competitive advantage for India over China!

13 May 2007

"Planet Earth" by BBC/Discovery Channel

This DVD issue is awesome.

Discovery Channel/BBC team use state of the art technology to take us through the various eco systems of our planet - polar ice caps, mountains, plains, rivers, caves and deserts. You get to see the regions from the space, from the sky, from a tree top, on land and on occasions from down under. Rare events (births, first moments, hunts, survivals) have been captured with great alacrity and patience and presented in one seamless flow.

Ever seen Niagara falls from various observation points? Right atop the horse shoe falls? On a "maid of the mist" boat tour taking you as close to the falls as possible? On the temporary wooden platform of "hurricane deck" where the secondary spray itself is powerful to knock you off and the huge mass of flowing water above your head "scares" you? On a "journey behind the falls" (on the Canadian side)?

Ever seen the Grand Canyon at sunset time from "Hopi point" with the Colorado appearing as a nice serene silver ribbon barely visible in the total landscape? Ever trekked down "Hermit's rest" to realize how rugged the terrain is? Ever took a "white water rapids" ride to experience the thunderous flow that the silver ribbon has become? Ever took a helicopter ride over the canyon to see Peak Brahma and Peak Vishnu in their inspiring splendour lording over the rocks?

Ever snorkelled in the Great barrier reefs in Australia? Ever did an underwater glass boat ride over the Arlington reefs (and get teased for it because your kids got to do the more adventurous 50 m scuba dive around the same time)?

Ever spent a day to reach Jungfraujoch (through the Eiger tunnel up the Eigher North wall) to see the picturesque view atop the mammoth Sphinx observatory deck? Ever saw the same stuff from a flight tour over the Swiss alps and realize that this huge observatory is a tiny toy in a massive blanket of snow?

Ever stood on an Alpine farm land with a parasail (and a tandem pilot, of course) attached to you and run at breakneck speed toward the edge of a cliff? Ever experienced the magic moment when your feet are off the ground and you are flying/floating/sailing/gliding with nothing between your feet and the lake town 2,000 m below? Ever moved from the embarrassing moment when you have self doubts (while your little girls and wife have taken off smoothly) to the moment when you are in air catching a thermal and getting a big uplift?

Every time you have an awesome moment like this in your life your respect for Planet Earth goes up. So does your fun in living in this ecosystem.

This exceptionally entertaining DVD series brings those magic moments of joy you experienced (and those you have not) right into your living room.

Grab one. Watch in a big screen TV. Enjoy.

"Benazir Bhutto, daugher of the east" by Benazir Bhutto

In his book “Prisoner without a name and cell without a number” Jacobo Timerman says that oppressed population go through three stages during the course of oppression: anger, fear and apathy. For "anger and fear" Pakistan did not have to look beyond General Zia-ul-Haq. For apathy they did not have to look beyond Benazir Bhutto.

Benazir, in 1988, was Mannah coming down from heaven for Pakistan.

She was the first born of the elite aristocratic Bhutto family. (Charles Napier, famous for his “Peccavi – I have Sinned” pun writes that Bhutto landholding was so extensive that he would travel for hours in Sind and yet be in Bhutto land). She went to Radcliffe and later to Oxford. She was the first woman president of the Oxford Union.

Young Benazir, 23 when her father was murdered by Zia, was kept in prison by Zia for several years. Undaunted by all this, she provided leadership to PPP, her political party. When allowed to go out of Pakistan in 1984 she continued to run the party from her Barbican apartment in London.

In 1986 she decided to return courageously to Pakistan when Zia was ruling. People defied military rulers and gave her a welcome that remains unrivalled. She continued to whip up her agenda for bringing democracy back to Pakistan for the next two years.

1988 proved to be a turning point for Pakistan and Bhutto. Zia’s role for Pakistan to be a frontline state in the war against communism proved to be temporary. Zia’s role for Pakistan to be a frontline state in evangelizing Wahabi Islam proved to be permanent. Zia died in an air accident. Benazir Bhutto became the first woman PM of Pakistan when she was just 35 yrs.

Until this time her life is a story that inspires. After becoming PM hers is a story of lost opportunities.

She did not use her power base to enshrine democracy and was comfortable securing a position of power in existing autocratic frameworks. This allowed Ghulam Ishaq Khan (a civil servant who succeeded to become President) to dismiss her once and Farooq Laghari (an underling who got elected to be President due to Benazir’s support) to dismiss her again.

She did not ensure her husband was above suspicion. Pakistan government had detained her husband in prison for more than 6 years on 90 charges of corruption though it has not secured conviction in even one case . However, it is not easy to ignore the fact that Zardari, not rich at the time of marriage to Benazir, owns a 355 acre property south of London according to Wikipedia.

Benazir is a good writer though. Some interesting snippets:

The feelings of an educated young Muslim girl wearing a barkah for the first time are vividly described. The world was not the same through gauze. The build up of humidity inside the cloak was uncomfortable. Her relief when her father tells that she does not need to wear a barkah is immense. However, it was her father’s decision; not hers. Who is the liberal?

Benazir Bhutto rightly feels that the West does not care for freedom in frontier states as much as freedom at home:

(a) In 1958 US trained Pakistan Army in “immobilizing” a government through strikes. The operation was titled “Operation Wheeljam”. Why would US want to do that? Why would Pakistan army want to get trained in that?

(b) Margaret Thatcher, in a trip to Pakistan, praised Zia and declared Pakistan to be the “last bastion of freedom”. An example where a leader's wisdom has not kept pace with knowledge.

(c) Undersecretary of State James Buckley testified before US Congress that “elections were not in the best interest of the security of Pakistan”. Another example of paucity of wisdom.

Pakistan had a long term price to pay. After the Afghan war, Kalashnikovs were available, according to Benazir, for $ 40 in Karachi. One can rent by the hour too. Landowners and Industrialists began to employ private armies to protect themselves. By 1983, Pakistan had become the major supplier of heroin to the World with some support from the State. (Abdullah Bhatti, one of the two drug bosses, was arrested and sentenced by a military court. But Zia intervened and gave him a Presidential pardon, a power he never used for anyone else!). Narco terrorism was born.

The second major impact was on women. Zia introduced the Hudood ordinances whereby a woman charging a rape should prove it with four male witnesses; otherwise she would face adultery charges herself. Safia Bibi, a blind servant girl was raped by her employer and his son; and could not prove it – rape rarely being conducted in public. The two men went free and Safia was charged with adultery. Campaigns by outraged women saved Safia Bibi; but not other less fortunate women.

However, Benazir is not as eloquent about her times as PM as about her times as a prisoner. There is very little about her challenges as a PM: her failure to get a good constitution written, her failure in dealing with Presidents who never had public mandate, her failure in dealing with traditional power brokers in the army, in the ISI, her failure to rein in her husband; her initiatives for development of social and economic aspects of Pakistan and her failure in engaging with India. In the end, she got consumed by the very forces she tolerated as a prisoner and as a PM. Pakistan did not revolt when she moved out to Dubai.

The book is interesting when it deals with the anger and fear till 1988; and gets boring when it reaches the stage of Jacob Timerman’s “apathy” after 1988. Benazir too does not think the period is important and devotes 90% of the book for her first 35 years till she becomes PM and just 10% for the next 19 years as PM, Opposition leader and Leader-in-exile.

When it was first published in 1988, I liked the book. Today, am just bored.

06 April 2007

"Kundun" by Martin Scorsese

In 1985 I was hosted by Dr Tom Bailey and Dr Judy Bailey in Rochester Hills, Michigan in a student exchange program. Judy is a lawyer (truth, the whole truth and nothing but the truth) and Tom is a dentist (tooth, the whole tooth and nothing but the tooth).

World was divided then between two super powers. Ronald Reagan was talking of "evil empire" and "star wars". Mikhail Gorbachev was tinkering with "peretroiska" and "glasnost".

Judy had just then returned from a tour of the Soviet Union and was presenting her photographs at the local church on a Sunday evening.

One photograph would stay in my mind forever. It showed a very small group of people congregating to pray; and a nice small Cross in a well decorated alcove. Sixty eight years of an atheistic political rule could not destroy religious faith and emotions.

The ability of human faith to stay alive across generations when such a faith is denied a chance to exist is amazing! Someone somewhere always keeps tiny little sparks alive for causes forced to be forgotten.

Therefore, Tibet has hope.

No matter how many years China rules Tibet; no matter how many Chinese settle down in Tibet and convert Tibet into a Chinese territory, someone somewhere would keep tiny little sparks alive to keep Tibet's identity as a peaceful serene temporal/religious system.

Kundun is the story of Dalai Lama.

The young boy is discovered to be the reincarnation of the earlier deceased Dalai Lama; is taken to Lhasa and coached in the ways of Buddhism. How does the peaceful wise leader of a non violent nation fight the aggressive plans of an ambitious, efficient and modernized army of Red China? Is the nation important? Or is "ahimsa" important? It is exceptionally difficult for a young Dalai Lama to decide.

In the end, Red China occupies Tibet and Dalai Lama is forced to move to friendly India and form a government in exile. He is yet to return to Tibet.

Tibet is forgotten by World because the aggressor does not play by its rules and the offended would not resort to terrorism.

However, nations never cease to exist. Someone somewhere keeps a tiny spark alive. Martin Scorsese's 1997 movie: Kundun is one more spark for Tibet's continued existence.

The movie stays away from melodrama. China is not portrayed as a villain. The way some Chinese narrate how Chairman Mao brought justice to their life is likely to win respect for communism. The young Lama is portrayed in life like terms: a vivid mixture of curiosity, anxiety and mischief. The maturity of the young adult Dalai Lama is nicely portrayed when he tells his mother that women cannot stay in the monastery after dark in a stern affectionate tone.

Lovely movie.

27 March 2007

"Frontline Pakistan: the struggle with militant Islam" by Zahid Hussain

Zahid Hussain touches on an important topic: Pakistan’s ongoing and impending war with its own self and the tough choices ahead of President Musharraf.

The support from Public Opinion in Pakistan for terrorism as a tool to further beloved causes is worrying. The ease with which sundry pet agendas could be converted into beloved causes is twice worrying.

In order to contain global terrorism emanating from Pakistan or having a safe haven in Pakistan two things need to be done:

(a) Public opinion will have to undergo a change in Pakistan. Public opinion is useful only when it derives from the "wisdom of the crowd". This benefit would not arise unless opposing thoughts and beliefs can “co-exist peacefully”. Good leaders “discredit” public opinion if it denies room for such peaceful co-existence. Mahtma Gandhi did. Bad leaders, on the other hand, whip up public opinioin to radically extreme positions using intolerance. Adolf Hitler did. Military rulers in Pakistan are guilty of whipping up public opinion to take a self righteous radical form that destroys opposing thoughts, reasons and emotions.

(b) Defending one’s religion is one’s right. Giving one’s life for one’s religion, one’s country or one’s society is a noble deed. This is true for Americans dying for the Flag and Muslims dying for their holy causes. However, immature leadership is quick to provide its pet agenda a higher purpose to merit the label of a "noble cause". In Pakistan this seems to be too easy. Military, whether in rule or not, has used religious leadership to provide the “emotional ammunition” to enlist support for every thing including a proxy fight against Soviet Union on behalf of USA, a proxy fight against the perceived foreign policy of USA, a proxy fight against one faction of freedom fighters in Afghanistan in favour of another, a proxy fight on behalf of Pakistan’s army itself in various engagements in/with India.

As a result, the postal address for global terrorism is somewhere within Pakistan.

President Musharraf is now forced to:
(a) appear to the outside World to be firm in dealing with relgion based terrorism and
(b) appear to Pakistanis to not succumb to international pressure

Quite a funambulation even for the skillful Musharraf. Musharraf does appear sincere in attempting to weed out terrorism; but does not appear sincere in having a go at modifying public opinion in Pakistan. His challenges in doing so cannot be underestimated.

Zahid Hussain is the Pakistani correspondent of The Times, The Wall Street Journal and Newsweek. His dispassionate insightful analysis of Pakistan’s struggle with militant Islam is excellent. As with most books about Pakistan, there is excellent analysis of the present but no thought from anyone in Pakistan on how to solve the problem. The absence of an alternative thought or the unwillingness of such thought to express itself is hardly Zahid Hussain’s fault.

05 January 2007

"Scoop!" by Kuldip Nayar

It was a wrong time to be a teenager.

Socialism, seeded in by lofty intellectuals in pursuit of an utopian dream of equality, was failing to deliver. Yet this failed economic solution was a good political platform to secure a constituency.

Political standards were at their lowest. A son became more important than a country. Democratic traditions were killed. Fundamental rights were suspended and held inferior to State policy. State policy was of course as decided by a small coterie. Opponents were imprisoned. Newspapers were censored. There were a few who were elated because trains ran in time and because there were no strikes. The worst moment was when a sycophant Deb Kant Barua proclaimed: “India is Indira and Indira is India”. The leader was hopeless. The country was without hope.

And then, people spoke. Indira's actions and her coterie were firmly rejected. (She herself was not rejected; she was later able to come back to power).

In that first whiff of freedom, it was fun to rediscover hope in life.

There was an eagerness to understand what went wrong; how did it go wrong and what made everything right. Kuldip Nayar provided the answers in his book “Judgment”.

Kuldip Nayar never disappoints. The young lawyer from Lahore who migrated to India, studied his Masters in Journalism in Northwestern University in Evanston Illinois, returned to be press secretary for G B Pant and later Lal Bahadur Shastri and went on to be editor of Statesman is a well balanced analyst of political events just as they happen.

In “Scoop!” he provides an “inside angle” to events in the subcontinent. Some are thought provoking. Some are a revelation. Some are of no interest beyond the heat of the moment.

Some snippets:

(a) Mountbatten concedes his inept handling of partition caused the death of a million people. However, he claims his net score with his Maker is positive because he saved two and a half million lives in World War II. To imagine this "convoluted thinker" was making policies in ruling a nation is scary!

(b) Radcliffe says that Lahore (with a majority of Hindus/Sikhs at the time of partition) should have come to India and was given to Pakistan because the new nation did not have a big city. Do we hold a plebiscite in Lahore now?

(c) Morarji lost a chance to succeed Nehru because a press interview made him sound ambitious because it reported that “he threw his hat into the ring” and tilted the votes against him in favour of Shastri.

(d) Zulfikar Ali Bhutto concedes that “he started the war with India in 1965” by orchestrating the infiltration!

(e) When Congressman Sardul Singh Kaeshwar wondered whether he should repay a Rs 500 loan that was time barred, Mahatma Gandhi was firm in saying this was not a legal issue and this was a moral issue. Nehru dumped Keshav Dev Malavia because Malavia could not account a political contribution he received for Congress party from a businessman. Moral standards in politics were high. Modern day politicians demand proof of corruption charges in a court of law. That an average adult would have reasons to deduce there was corruption is not sufficient.

(f) Indira Gandhi suspended fundamental rights. Gandhi and Nehru would not have approved. Yet four people did! Justices Ray, Beg, Bhagwati and Chandrachud agreed that suspension of fundamental rights did not imply suspension of rule of law. Ray opined that when there is “public danger” protective law should give way to interests of the state. There was hope however. Justice Khanna dissented. (Khanna was superceded when a junior Beg was appointed Chief Justice. Khanna did not oblige the government by resigning. He stood tall by staying). In my mind, Justice Khanna is a hero.

A good read.