Wednesday, November 16, 2016

India in the Trump era

by Harish Gupta, National Editor, Lokmat Group

From Republican presidential nominee of the United States of America, Donald Trump is already the President Elect, and is irreversibly marching towards his inauguration in January. The traumatised liberals are hoping against hope for some miracle at the last minute, like electors pledged to support Trump changing their mind in a fiery defiance of convention, if not the election law. But all that is a mark of the extreme numbness that has overtaken the minds of Americans who were hardly prepared to see the nightmarish figure of a part-crackpot part-bully storming into the White House and occupying it for four years, at least. 

While time may not always prove to be the best healer, and a divisive president is certain to leave his mark on America if not the world, it is still necessary to get clarity on what Trump's election actually signifies. It will surely be a repudiation of a central assumption about America's commitment to greater inclusiveness at home, and free trade and global leadership abroad. The unfathomable policy uncertainty that may be waiting to be unrolled in the Trump era can recoil on the world in myriad ways. It may witness an anti-democracy military grouping, or an ideology-less grouping against conceived enemies. It may be the funeral of multilateral trading. It may mark return to the high tariff walls of the Reagan era. Or in any other painful way in which you turn the clock backward. Still, the moot question is, can the tsunami also throw up opportunities for a bit player like India? Just as Nixon/Kissinger's overture to China to get it on the side of the US in 1971 did to the future of the latter? In the following year, after Richard Nixon, visited Beijing and met Mao Zedong, he termed the visit as "the week that changed the world". In the thick of the Cold War, what China could offer was an addition to the Soviet Union's worries. What lies in India's destiny depends on what it can offer. 

India can emerge on Trump's radar only if—and that's a big if—he sticks to his campaign promise to punish China for being "currency manipulator", beside looking for "new trade barriers against Chinese imports". China is only marginally dependent on imports from the US but it is America's largest source of import. US goods export to China in 2015 were $116 billion while China goods export to the US were $482 billion. Following the gradual deindustrialisation of Middle America—the reason why Democratic candidate Hillary Clinton got routed from the 'rust belt' states like Michigan—the US has now become totally dependent on China for top import category items like electrical machinery, machinery, furniture, sports items or footwear. 

Trump has threatened tariff up to 45 per cent on Chinese imports which, though still a threat, is within the realm of feasibility, For at least two more years, it will remain a Republican Congress; so the fabled checks and balances of the American democracy may not count. India can join the game if it can tap its potential of cheap labour and its deep knowledge base, particularly of its large public sector corporations, to fill in the vacuum that China may leave. It is obvious that the Chinese imports to America excludes products of high-tech American companies in mainland China, such as Apple. On the other hand, Chinese imports are moderately labour intensive, with labour costs playing a significant role in their competitiveness. But wages in China are rising fast. It is on this ground that China is losing its competitive edge in the US market. It is perhaps one of the reasons why the Barack Obama administration focused on the Trans Pacific Partnership of 11 countries including Vietnam and Malaysia. India can be a major player in the US market if it plays its cards well with the most unpredictable and disruptive administration the US Capitol has ever seen. 

Still more uncertain is the possible impact of Trump’s professed dislike of the H1B visa, and whether it can punch a big hole in the IT industry that earns $100 billion in exports. In this space, I have discussed the critical technology shifts that threaten the very business model India follows, which is that of locating trained workers in client premises and thus giving the client the advantage of cheap and available labour. The model is threatened by artificial intelligence and big data. Indian IT workers are of course a smart lot and it may not take them long to catch up with others on the use of artificial intelligence and, in a way, add value on robot. But an abrupt closure of visa programmes like H1B or L1 has the potential threat to trigger a reverse exodus of many thousands of Indian American workers, not to speak of a sudden break in the $10-billion annual pipeline of remittance from the US. 

In the strategic context, Trump’s pronounced distaste for persons of the Islamic faith, if translated into action, can create such a stirring in the Muslim world that it can bring the age-old US-Pakistan ties to a sudden end. Pakistani media have begun reflecting the existential fear of a country long used to diverting American weapons marked for use against terror groups, to attack India through its proxies. Nor can it rely indefinitely on China. America is still the biggest source of technological knowledge, and China, after having covered a long way from a peasant economy to the world’s number two, is still in need of US knowhow. Trump may review his opinion on China, but not if it keeps spilling nuclear technology to North Korea and Pakistan and arm the latter with copycatted versions of the F16 fighter jet with designs stolen by Chines spies at the plant of Lockheed Martin. It’s time for both China and Pakistan to behave. 

Thursday, October 27, 2016

Stand by India

by Harish Gupta, National Editor, Lokmat Group

Deepavali, the Hindu festival of light, is not just an Indian event. It is a public holiday in as many as 11 countries, including Pakistan, as it signifies the victory, among other things, of hope over despair.

As far as India's economy is concerned, it is doubtful if the coming Deepavali has much bright tidings to offer. The indicators on the ground, like sluggish sales of fancy cars, expensive flats and such big-ticket items, are matched with an array of drooping indicators. Of the latter, I think the most significant is the sharp fall in the second quarter of 2016-17 of the Gross Fixed Capital Formation (GFCF). The GFCF measures the capital deployed in investment at a given point. From the first quarter of the current financial year to the second, it dropped from Rs 8,861.47 billion to Rs 8,639.56 billion. If investible capital shrinks, how will industry grow?

The fact that industry is caught in a mess is apparent from data churned out by the Central Statistical Office. Industrial production in India has contracted 0.7 per cent year-on-year in August 2016. It follows a 2.5 per cent squeeze in July. The declining industrial production figures show sector-wise collapse. Like a 49.4 per cent drop in electrical machinery and apparatus, and a 22.4 per cent fall in furniture and wearing apparel. Arguably, it points towards a downward spiral in standard of living. Such a conclusion is logical in view of the poor growth of bank credit, which stood at around 10-12 per cent year-on-year most of this year against 16-18 per cent in 2013-14 and in subsequent years. 

Cement production is down to 22,283 thousands of tonnes in August, from over 25,000 thousand tonnes most of 2015. The number of cars registered in September, though a respectable 268,058, is still way behind the previous monthly high of 304,000 in March 2012. The index measuring infrastructure output has levelled to 3 after reaching an 8-plus high earlier this year. Although steel has rebounded in the past few months, electricity, coal, natural gas and crude continue to be a dismal story. What is certainly on the rise is the government's military spending, from US $48,403 million in 2013 to US $51,115.9 in 2015. And like most other indices, the export growth languishes and so does import.

Simultaneously, there is a general decline in global interest in the so-called "India story", as evident from more guarded reports on Indian economy in the western media. An ominous silence has descended on the IT sector, India's proud emblem of technological maturity. IT czars like TCS and Infosys, after showing anaemic results for quarter after quarter, are now engaged in a battle for survival. Their Western clients are now reluctant to outsource operations to foreign vendors as globalisation as a concept is facing rough weather politically. But the brick-and-mortar alternative to information technology is gasping. The recent news of a few hundred graduate engineers being among seven thousand applicants for 120-odd sweepers' jobs, at Amroha in Uttar Pradesh, was found so commonplace that it buried it in the inside pages.

Narendra Modi, before becoming prime minister, routinely condemned the previous government for "jobless growth". On assuming office, he launched a slew of projects such as Start up India, Digital India, Smart City, Skill India, MUDRA. All these were aimed at creating a new class of Indians educationally and professionally equipped to manage their careers themselves. But so far these have remained largely signboards. On the other hand, a million boys and girls are entering the labour market each month with little hope to land a job. In a recent sample survey, 77 per cent of households were found without a single member with regular income. Unemployment rate has hit a five-year high of five per cent. It is argued that definition of employment and employability has changed with the change of time and merely obtaining an engineering degree alone cannot take the person to an upper income bracket. Lakhs of such graduates passing out each year are casual employees or have some seasonal income.

Modi came to power promising a remedy to jobless growth, but it seems he does not have a silver bullet. The new entrants in the labour market severely lack training. Just 2.5 per cent of the country's working population have any vocational training, compared to 60 to 70 per cent in OECD countries. As its natural consequence, reservation demands in jobs and educational institutions from caste groups like Patel, Maratha and Jat have become the defining feature of electoral politics. 

Modi is a globe-trotter and claims having strong views on all nations, including China, the neighbour with which he is involved in duelling on terrorism. Since he has a deeper knowledge of global economy, he’d have noticed that China emerged as the ‘workshop of the world’ by systematically keeping its currency devalued for decades, with its workers producing goods cheaply because they were paid very little. Something similar, though on a smaller scale, is happening in Bangladesh, where unskilled or semi-skilled workers, mainly women, have turned the country into an international hotspot for ready-made garments.

At a time when jobs are disappearing everywhere, and Artificial Intelligence has been to industry what steam was two centuries ago, it requires innovative thinking to create jobs for the multitude. It calls for a deeper understanding of how resource-poor nations engage large number of workers in making export-grade products. Maybe India needs to rethink its strategy of holding the exchange value of its currency at a high level, as it is more necessary to earn dollars than to let the rich buy his BMW cheap. It is also necessary to enable more women to join the productive work force. That will be more useful than leaders showering advice on women about dressing and lifestyle.

Tuesday, October 18, 2016

All BRICS no mortar

by Harish Gupta, National Editor, Lokmat Group

If the eighth summit in Goa of BRICS—the geography-defying grouping of Brazil, Russia, India, China and South Africa—ended Sunday on a subdued note, it was because of the presence-in-absence of a non-member, Pakistan. The summit, inarguably, was timed rather awkwardly. The mind-space of India, host for the event, was preoccupied with the western neighbour ever since the attack by Pakistan-based terrorists on an Indian army brigade headquarters at Uri in Kashmir, leading to the death of 19 security personnel. It led India to make unanimity on "terror" its continuous refrain through the summit.

BRICS is a grouping focused on cooperation in trade, but two developments have lately got it derailed. First, the rise of China has changed the dynamic of trade. By 2013, China had grabbed a fifth of all manufacturing export worldwide, compared to only two per cent in 1991. In the first decade of this millennium, when BRICS got going, there was hope that China could be the engine to drive a trading bloc forward. But such optimism has now given way to the fear of being swamped by Chinese imports. 

The other problem relates to the changing dynamic of strategic power. Of the five-nation group, the three leading military powers—Russia, China and India—have their individual strategic objectives. Russia under President Vladimir Putin is bent upon regaining the respect it commanded in the Cold War era as a formidable war machine. It is a growth trajectory that expectedly leaves the US uptight. It responded by extending NATO, the five-decades-old anti-Soviet strategic alliance, to Ukraine at Russia's doorstep. Russia has hit back in a complex bag of stratagem, from helping Syrian president Bashar al Assad, whom America regards as foe, to reportedly interfering with the US presidential elections by using its agents to hack the computers of the Democratic Party. The rapidly declining US-Russia relations have put India in a double bind as it needs both. The US is its life-line to technology, foreign capital and remittances whereas Russia is not only its sole supplier of basic military hardware but its only dependable 'big daddy' to extend help at international forums. The escalating conflict between the Cold War gladiators has left even the Western powers in a dilemma, not to speak of India, Brazil or South Africa.

Besides, China has Pakistan as it strategic partner, its "iron brother". To China, Pakistan is a trusted interlocutor to the Islamic world, and a useful guide to the US security establishment due to Pakistan's close links with the American army for decades. Unleashing Pakistan on India, or at least egging it on, is also China's way of acting tough on India without dirtying its own hand. This Chinese tactic has become rather obvious in its dogged Chinese persistence to protect Masood Azhar, the chief of Jaish-e-Mohammed. The JeM is a terror group reportedly responsible for the Uri attack as well as the 2001 attack on Indian Parliament. Its due to China that JeM couldn't be declared by the UN as a terrorist group. It points at the possibility of a substantial Chinese stake in the terror factory that Pakistan has nurtured.

In 2006, when BRIC (South Africa was yet to join) took shape, it was visualized as a club of large and fast-growing economies. But they have slowed down since then. South Africa, which came on board in 2010, grew at only 1% in 2015. Brazil is in its worst recession in the past 80 years. Russia is grappling with a slew of sanctions. The drop in oil and gas prices has combined with the global downturn in consumption of manufactured goods, Russia's forte, to make its condition worse. On the other hand, triggered by a wage spiral, China's slowdown is a drag on global growth. India's PPP GDP is 40% of China. It is growing reasonably fast but not fast enough to catch up with China in the foreseeable future. Besides, rather than giving India access to its market, it is demanding unhindered entry into the Indian market.

The BRICS talks reflected an uneasy and troubled relations between China and India and, in the process, turning the summit into an exchange of litany on terror. It is no wonder that, for India, the only concrete outcome is a costly shopping list from Russia of missile systems, stealth frigates, fighters and helicopters.

Significantly, the BRICS summit in Goa coincides with a meeting of the BIMSTEC (Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation), an avowedly economic partnership of seven nations: India, Nepal, Bhutan, Bangladesh, Myanmar, Thailand and Sri Lanka. The BIMSTEC outreach wants to keep away from big power rivalries, though there are temptations galore. Chinese president Xi Jinping’s next destination, after Goa, is Dhaka where he has a 24 billion dollar loan-and-aid package to offer. It is unlikely that China’s heart is melting for Bangladesh. China was on the aide of Pakistan in the 1971 Bangladesh war. It recognized Bangladesh as late as 1977, two years after the assassination of Sheikh Mujibur Rahman, architect of the new nation. Besides, most gifts from China prove costly to the recipient as they involve a cluster of Chinese private investments that are based in inflated revenue expectations. Failure to repay such debt become sovereign liability. It has happened with Chinese-financed Hambantota port in Sri Lanka which has negligible revenue but high cost.

BRIC is the brain wave of an executive in Goldman Sachas, an American bank, who used the acronym in 2001 to hype up the emerging economies. It is now a platform for power play of two ambitious global powers, Russia and China. It is BIMSTEC, on the other hand, which has the beginner’s simplicity. All it’s passionate about is a road from India to Myanmar and Thailand.

Tuesday, October 11, 2016

Why Muslim women will thank Modi

by Harish Gupta, National Editor, Lokmat Group

By opposing the Muslim marital practice in India of "triple talaq", the Narendra Modi government, in a submission to the Supreme Court last week, has taken a bold move that previous governments didn"t dare. The ministry of law and justice, in its affidavit, pointed at the constitutional principles, like gender equality and secularism, and said: "The fundamental question for determination by this court is whether, in a secular democracy, religion can be a reason to deny equal status and dignity available to women under the Constitution of India".

While Muslims, the largest minority group, are free to abide by their personal laws for marriage, divorce or inheritance, women"s rights activists have been strident for a long time in their demand for reform of the archaic and oppressive divorce. It allows a husband to divorce a wife who has fallen out of his favour simply by using the shortcut of uttering the word "talaq" three times at her.

Islam"s holy book, the Quran, constructed its rules of matrimony as a social contract. It has provision for divorce if it is exercised in a sequential manner, with a gap of 90 days between each step. These gaps leave sufficient room for reconciliation and negotiation. The final separation, "Talaq-ul-Bidat", comes after exhausting all options of rapprochement. It is not too long after the Quran was written that Islamic scholars of various schools devised the quick fix of saying three talaq at the same time. That gave a misogynist edge to Islamic personal world throughout the medieval and early modern ages. It changed around the early twentieth century, with Turkey adopting the western civil laws and Egypt banning triple talaq. Now as many as 22 Islamic nations, including Pakistan and Bangladesh, have abolished it. Besides, there is no triple talaq among Shias, making Iran free from its bane.

In India, stonewalling of reform of the Shariat Application Act, 1937 is the handiwork of an orthodox group in the Muslim community that controls the network of mosques and madrasahs, and plays on the collective insecurity in the minority psyche. A book published by Bharatiya Muslim Mahila Andolan titled "Seeking Justice Within Family" lambasts the practice. It said fast-track divorce regime enabled by the one-sided and male-chauvinistic law has led to untold misery. Hundreds and thousands of poor Muslim women and their helpless children live in shanties. The organisation found that out of a sample of 4,710 women, as many as 525 were divorced. Of them, 346 were divorced verbally, 40 by letter of divorce and three through e-mail. The divorce rate among Muslims is higher than any other religious groups. But the slapdash method of divorce, and the law"s silence on continuous and meaningful maintenance for the children, has turned many Indian Muslim households into nightmare for the womenfolk. Women activists have correctly pointed out that the pauperization of Indian Muslims as a community, as noted in the Sachar Commission report, is substantially due to the inhumanity inherent in the divorce law.

However, the government wouldn"t have been called upon to take the initiative in banning triple talaq 

if former prime minister Rajiv Gandhi had not seriously erred on his judgment 30 years ago. In 1986, Shah Bano, a 62-year-old Bhopal housewife, who had been turned away from home by her husband employing triple talaq, had found the Supreme Court by her side. The court disregarded her husband"s interpretation of the Sharia on constitutional ground, and made the divorce conditional upon compensation to be paid by him in conformity with civil divorce. But Rajiv Gandhi buckled under pressure of his advisors, who were against upsetting a "vote bank". Besides, he surrendered to powerful pleading by the orthodox All India Muslim Personal Law Board (AIMPLB), an elite minority group closely connected with the network of mosques and seminaries. Rattled for no ostensible reason--the Congress under Rajiv enjoyed absolute majority in the lower House at that time--the government enacted a new law in record time to limit the Supreme Court"s power via-vis Muslim personal law. It is an irony of history that the same AIMPLB is the main opponent to the current move to finally reboot the Muslim divorce law. And, unlike in the days of Rajiv Gandhi, the party now in power neither has a Muslim vote bank nor has to worry about electoral backlash from a community that hardly votes for it. There is every possibility, therefore, that a decision of the court in favour of the women activists" petition will lead to a new legislation that brings Muslim divorce law at par with that prevailing for other communities.

However, the public opinion created among Muslim women, and many educated men, against the injustice done to the society's weaker members under the cloak of religion underlines the necessity to discard fixed ideas about any community. In Pakistan, Mohammed Ali Bogra, the prime minister in 1955, fell in love with his secretary whom he married by divorcing his earlier wife calling triple talaq. It created such furore that the government had to enact a new divorce law in which it became necessary for a disgruntled husband to file a complaint against his wife to the union board (local administration) chief before divorce, and send the wife a copy to exercise her right to reply. At its birth in Bangladesh in 1971, it inherited from Pakistan the amended divorce law.

The Islamic nations that are also democratic have no compulsion to look upon their Muslims as vote bank. That may be the reason why their personal laws have kept pace with time. In India, on the other hand, the government's hyper-sensitivity about not offending the conservative mullahs tied its hands. It is good news that a party that does not give a hoot to the electoral blessings from a community is taking measures that will benefit its members over generations.

Tuesday, October 4, 2016

A surgery long overdue

by Harish Gupta, National Editor, Lokmat Group

By giving a nod to a swift and target-based military retaliation in the early morning of September 28, Prime Minister Naraendra Modi has turned inside out India's long-established set of responses to provocations from Pakistan. The upending of the familiar Indian strategy is even more pronounced by India taking the initiative in declaring the authorship of the "surgical strike" on the terrorists' staging camps. The Indian Special Forces also inflicted "huge casualties" including killing "two Pakistani soldiers" who had come to the terrorists' rescue. If there were low-key line-of-control crossing episodes in the past, India never went public. Whether it was Operation Parakram in 2002 or India retaliating to the beheading of the soldier in 2013, the government never claimed that its forces crossed the LoC. India always treated armed reprisal as the last resort. It waited for 24 years till 1998 to turn its tested nuclear capability into a weapons programme. In 2008, following the most daring attack in Mumbai by Pakistan Army's proxies, resulting in the loss of 164 lives, public outcry for a retaliatory attack on Pakistan was at its shrillest pitch. Yet India did not budge from its commitment to "strategic restraint".

That Modi has finally moved away from that doctrine is consistent with his pre-election commitment of giving a "fitting reply" to Pakistan. Following terrorist attacks in Gurudaspur, Pathankot and finally Uri, failure to live up to his promise would have haunted him like albatross around his neck. It was a risk he could ill-afford, with the manufacturing struggling to pick up, unemployment haunting and elections to Uttar Pradesh, Uttarakhand, Punjab, Goa & Manipur round the corner. His Man-Friday and BJP president Amit Shah is a hawk and played a key role in formulating political decision making. Even beyond electoral politics, inaction after the Uri attack would have put at stake his identity as someone "different" from the Nehruvian "peaceniks". His rating as a man of iron would have fallen even below that of his predecessor from BJP, Atal Bihari Vajpayee, who, despite his reputed fondness for 'biriyani diplomacy' with Pakistan, had actually fought a costly and difficult war with it on the peaks and slopes of Kargil in 1999.

That Modi would choose the tough path was evident from his choice of Ajit Doval as his National Security Advisor. Doval is the bureaucratic architect of the current policy shift from strategic restraint to "offensive defence'. As early as October 2014, he summoned the BSF chief and advised him to respond to cross-border firing from Pakistan with "higher than proportionate" intensity. The BSF was also advised by Doval to desist from holding the usual flag meetings with Pakistan Rangers after such incidents. The policy shift began paying dividends in an indirect but purposeful way, by boosting morale of the armed forces after a decade of despondency and despair caused by the regular cycle of aggression from the Pakistan side and mere hot words from Indian politicians. The September 29 surgical strike by Indian Special Forces should be seen in this context. India desperately needed to come out of morass of helplessness against a bullying neighbour, and its territory being used, in the words of one of our diplomats in the UN, Eenam Gambhir, as the "Ivy Leagure of terrorism". In the past, such forceful phrases would have sounded hollow without any concrete action on the ground. But, after the 29 September reprisal, our DGMO was the first to declare that our forces had indeed penetrated inside PoK territory to carry out attacks. India was at last walking the talk. 

Pakistan has so far refused to accept the incident, or its nature, brushing it aside as just another cross-border episode. But such reticence may be a ruse to buy time and collect strategic thoughts to deal with a more determined India which is no longer shy to step on the escalation ladder. It now seems that Prime Minister Modi and his security team led by Doval have seen through Pakistan's decades-long practice of military and nuclear blackmail, and they have decided to call the bluff. Though the flow of bluster from Pakistan is as usual—and India is battle-ready with strike forces and other units fully mobilized—the civil leaders of the neighbouring nation, and their military bosses, are certainly finding severe limits on their choices. The Indian action has shown that Pakistan cannot hide behind its plea that the terrorists on the prowl are "non-state actors", so it must remain prepared for full-scale military retribution for every mischief committed by the UN-designated terror groups it trains, arms and harbours. As a strategic expert in Delhi was explaining to me, "the next Mumbai attack from Pakistan may trigger a combined naval and air attack on Karachi on an epic scale".

The source of Pakistan’s confidence so far is two-fold: first, the belief that China, its “iron brother”, will do all it takes on India’s northern and eastern frontiers to force India to scale down; and the US will exercise its influence to de-escalate the confrontation before it reaches the nuclear ignition point. However, Pakistan’s recent lessons from responses from Beijing and Washington are disappointing. China, on its part, did not go beyond expressing concern about the confrontation and said “both nations should exercise restraint”. The US pinpointed the Uri terrorist attack as the “cause of escalation” and reiterated that Pakistan must de-legitimise the UN-designated terror outfits. Besides, Pakistan found itself bereft of friends in South Asia as it was compelled to cancel the scheduled November SAARC summit in Islamabad following unequivocal condemnation of terror by Afghanistan, Bangladesh, Bhutan and Sri Lanka.

Modi is inarguably a controversial leader, but, in the third year of his rule, his diplomatic and military gambits are paying off. Except an electorally defunct CPI(M) and politicians like Mamata Banerjee and Lalu Yadav, wedded to minority vote bank, every opposition leader, including Congress president Sonia Gandhi and Rahul Gandhi, complimented Modi for his bold move.

Friday, September 30, 2016

The Bully and the Cilly

by Harish Gupta, National Editor, Lokmat Group

Going over the social media networks, my eyes got stuck at a news video from Massachusetts in the USA, the home for a slew of world-famous universities and regarded as one of the cradles of the country"s culture. The video shows a procession of SUVs snaking through the road with the Republican Presidential candidate Donald J. Trump"s pictures mounted on the top of their cars.

Wednesday, September 21, 2016

UP: Odds favour BJP?

by Harish Gupta, National Editor, Lokmat Group

Election to the 403-member Uttar Pradesh assembly is months away but its prelude is on. If Congress vice president Rahul Gandhi's on-going "Khat Pe Charcha" in the state giving him confidence to comment, "we are winning", the ruling Samajwadi Party is struggling to overcome biggest ever feud in the Yadav clan. The drama has considerably eroded whatever chief minister, Akhilesh Singh Yadav, had earned through his massive campaign. 

Akhilesh actually began canvassing several months ago, when the cash-strapped state government began to shower advertisements on newspapers and television channels blustering its achievements. The public spat between Chacha-Bhatija (uncle Shivpal Yadav and nephew Akhilesh Yadav) has shaken the very foundation of the 54 month old SP government. For BSP's Mayawati, the moment of action arrived apparently by accident, with scenes of bare-bodied Dalit cow-skinners being welted by supposed 'cow protectors' going viral on social media. Since then, on the question of who could be the best bet for the Uttar Pradesh sweepstakes, public attention is re-directed to Mayawati, the state's previous chief minister. And of course BJP is the looming omnipresence; only two years back, in the Lok Sabha elections, it captured 71 of the 80 seats and 42.30 per cent votes. 

But the 2014 parliamentary poll is different. At that time an atmosphere was created in which the nation thought it got itself in the vortex of a terrible economic and moral crisis, and Narendra Modi was projected as the saviour. The billion-rupee BJP campaign hit the country in 2014 like a thunderstorm that has blown away to a large extent. 

But has it? Or could it be that, in the state's vast caste cauldron, some changes that were simmering long since did reach the boiling point during the LS election? 

Before brushing aside BJP's 2014 victory in the state as purely one-off, it is necessary to consider the extent of Hindu polarization it witnessed. According to a BJP internal analysis, between 2009 and 2014, in Uttar Pradesh, BJP increased its vote-share percentage among various Hindu caste groups in the following order: Brahmin-57 to 72; Thakur-49 to 79; Yadav-6 to 27; Kurmi-26 to 56; Jat-21 to 81; Other OBC-20 to 60; Jatav-2 to 23; Other Dalit-8 to 60. 

It is clear that BJP was hugely successful in stitching up a common umbrella for all Hindus, not just for the upper caste, though its grip on Brahmins and, in particular, Thakurs, much strengthened. But what is nothing short of startling is the phenomenal rise in BJP's acceptability among Dalits and OBCs. From within Jatav, Mayawati's own Dalit sub-caste, support to Modi and BJP grew over 11 times in five years. Looks like a miracle, yet it has a background. 

After Independence, the dalit-upper caste antipathy raged so high that the former saw its destiny with Muslims rather than the Hindu community. "Jatav Muslim bhai bhai, Hindu kaum kahan se ayee?" This was the dalit clarion call in the post-Ambedkar years and it remained so for decades. Bharatiya Jan Sangh, the Hindutva party in its earlier avatar, saw this wall standing ahead but had no clue how to scale it. 

It began changing in the 80's, with RSS under the late Balasaheb Deoras holding all-caste dharma sabha across the state, and the Ramayan tele-serial helping forge a psycho-social sense of togetherness between upper caste and Dalit/OBC. However, it was not BJP but Mayawati who reaped the benefit of Dalits readying themselves to intermingle with others. In the 90's, she gave her BSP party, with elephant as its poll symbol, such memorable slogans like: Pandit shankh bajayega, Haathi badhta jayega. Her campaigns were a glorious exercise in what sociologist M. N. Srinivas called "Sanskritization". The 2007 Brahmin-Jatav alliance brought her to power. 

The magic failed in 2012 due to BSP losing the Brahmin support, and, with that, OBC and other social groups lost confidence in Mayawati. In Uttar Pradesh, Dalits including Jatav are 21 per cent of the population. As upper castes drifted to BJP, even Mayawati's Dalit constituency became wobbly. Or else it is difficult to explain her miserable performance in 2014 Lok Sabha poll in which she could not win a single seat. Besides, no caste is frozen in a static social frame. The state has 2.5 crore first-time voters. In every constituency, there are around 90,000 voters under-30. Rather than looking at life through the prism of caste, younger voters generally look for aspirational figures. In 2009, Rahul Gandhi was an aspirational icon. In 2012, Akhilesh Yadav was aspirational. So was Modi in 2014. And that causes cross-osmosis of voters across caste and community lines. 

In the run-up to the 2017 Assembly election which is very vital for the BJP for various reasons, Akhilesh's SP is not only weighed down with incumbency. Even its loyal followers, Yadav and Muslim, are baffled. As 2014 poll showed, even Yadavs leaned towards BJP. And Muslims are none too sure about the SP- SP-BJP secret ties. Moreover, there is very little in either SP or BSP that attracts the imagination of new voters. SP is perceived as backseat-driven by a bunch of old patriarchal fogeys, with Akhilesh as its deceptively smiling face. And BSP has lost its mojo after the upper-caste desertion. It stands lifeless, like Mayawati’s stone elephants. 

It is arguable that BJP too has lost its aspirational fervour. And, after its debacle inBihar, it has proved vulnerable, which is a major negative for getting support of fence-sitters. It may have succeeded in the North East and Assam. But it is facing waterloo in Goa and Punjab. Even in Uttrakhand, the BJP has internal problems. Therefore, Amit Shah has entrusted Goa to Nitin Gadkari and put his eggs in UP’s basket. Secondly, Modi still rules at the Centre, a fact that carries weight in the thinking process of ordinary voters, particularly in rural areas. Surveys have shown Modi’s own ratings are intact though party is unable to create leadership in states. If it failed in Bihar, it was because of strong leader. The same problem exist in UP too. The polarizing agenda being pursued by some of its wings may help in consolidating its upper caste vote bank. BJP may have the edge. But election in the state is still a far cry. 

In the run-up to the 2017 Assembly election which is very vital for the BJP for various reasons, Akhilesh's SP is not only weighed down with incumbency. Even its loyal followers, Yadav and Muslim, are baffled. As 2014 poll showed, even Yadavs leaned towards BJP.

Four-pronged strategy to deal with Uri attack

by Harish Gupta, National Editor, Lokmat Group

Four-pronged strategy  to deal with Uri attack
NIA collects DNA samples of 4 JeM terrorists

Harish Gupta
New Delhi, Sept. 20

A four-pronged strategy is under consideration of the Central government to deal with the situation arising out of the Uri attack by the Pakistan-trained terrorists.

As part of the decision taken on Monday at a high-level meeting chaired by the Prime Minister Narendra Modi to isolate Pakistan globally, foreign secretary S Jayashankar cut short his visit to Vienna and returned home to help in executing the action plan. 

The on-going UN General Assembly where external affairs minister Sushma Swaraj will speak, may be the first global test for India. Minister of state for external affairs M J Akbar would raise the Uri attack at a meeting of foreign ministers in New York on Wednesday. It has also been decided to isolate Pakistan in South Asia as well. Since Afghanistan and Bangladesh have already lent support to India, it is yet to be seen if other SAARC nations agree to join India's cause. The SAARC conference, to be held in Pakistan, would be important from India's perspective.

India is also considering option to seek economic sanctions against Pakistan though strong direct evidence will be required to convince the world leaders. India has succeeded in persuading the USA to a large extent to reduce financial aid to Pakistan if not cut it altogether. Another proposal mooted during informal discussions is to consider if India should withdraw the Most-Favoured Nation (MFN) status granted to Pakistan. Though Pakistan never returned the gesture, Modi's policy makers are toying with the idea to call the bluff. But there is no unanimity on this issue so far.

The policy makers are also wrestling with the question of responding to the Uri attack without falling into the Pakistan trap of "internationalising" the Kashmir dispute. This apart, the home and defence ministries have also been directed to put their own house in order. The PM has directed that infiltration from the Uri border was an impossibility unless there is local support. Therefore, all out efforts be made to plug this deficiency. Secondly, the all-out efforts be made to prevent "Fidayeen attacks" particularly in cases where there is advance information. Those supporting the terrorists from across the border be dealt with a heavy hand, is the sermon. 

The government is of the view that Uri attack will help forces clamp down on separatists and Pakistani elements in the Kashmir Valley. The killing of eight terrorists on Tuesday is an indication of the new offensive launched by the forces in the Valley.  One option for the military is to activate the LoC, attacking Pakistani posts with artillery and mortars. The army can inflict disproportionate punishment on the Pakistan army. However, the military has been advised caution on this score.

The National Investigation Agency (NIA) has collected blood and other samples from the four terrorists who attacked the army base at Uri. The NIA is also examining the weapons, GPS ammunition and maps -- which terrorists carried with them -- to identify and retrace the route they took to infiltrate into India. All this will help India expose Pakistan at the world fora.

Thursday, September 15, 2016

'Jayam Dehi'

by Harish Gupta, National Editor, Lokmat Group

It is certainly not the way that an eminent party, having gone to seed lately, should give itself a makeover. Last week, when Congress vice president Rahul Gandhi gave kick start to his four-week-long, 2,500-kilometre flamboyant travel in Uttar Pradesh, a clever strategy went for a toss in the most unexpected manner. It was the idea of strategic planner Prashant Kishore, engaged by the Congress, to focus the campaign on farmers" distress, particularly their rising indebtedness, and get Rahul to hold close meetings with villagers seated on "charpai", or wooden cots, instead of addressing the usual rallies. That was supposed to make the Gandhi scion re-emphasise his earlier charge that Prime Minster Narendra Modi"s administration is "suit boot ki sarkar". Charpais, it was thought, would set the intimate tone for Rahul"s "kisan yatra" covering 223 assembly segment across the state"s 39 districts.

Fate of 2 guvs uncertain

by Harish Gupta, National Editor, Lokmat Group

Govt wants new faces in J&K, Arunchal

Harish Gupta
New Delhi, Sept 9

The fate of two governors of border states – Arunachal Pradesh and Jammu & Kashmir – is uncertain now. But reasons for the delay in changing both the governors are different.

The delay in changing Arunachal Pradesh governor Jyoti Prasad Rajkhowa is due to technical reasons as President Pranab Mukherjee has raised some issues with Union home minister Rajnath Singh. The home minister had called on the President on Wednesday to convey to him the intention of the government in removing Rajkhowa who had violated the spirit of the Constitution in handling the affairs of the state when it faced political crisis. 

The governor had come in for a rap from the Supreme Court as well. But the President is reported to have raised some important points. Firstly, the Union Cabinet had approved in toto whatever the governor had recommended then. Secondly, there has to be some reasons in writing from the government rather than simply asking the President to withdraw the governor at his pleasure.

The home minister is reported to have told the President that on one occasion Rajkhowa had misled even the PM when he had put some query. It's a lack of trust between the governor and government and his removal is the only way forward. It now transpires that an amicable way is being found to get rid of Rajkhowa.

Meanwhile, in changing or removing N N Vohra in Jammu & Kashmir, the situation is rather sensitive and ticklish as well. Vohra is a seasoned bureaucrat and there is nothing against him. But he is 80 years old and doesn't have new ideas given the alarming situation in the Valley. Modi government retained him for more than two years after coming to power. 

But it wants a new person in place of Vohra who was re-appointed as governor for second term in 2013. In a way, its more than eight years that he has been governor of the state. The Modi government is reported to have zeroed on Anil Baijal, former home secretary in the Vajpayee government, who is a seasoned bureaucrat as the new man in the Valley. The problem being faced is should Vohra be transferred or removed altogether.

It transpires that Rajnath Singh may have been asked by the Prime Minister to discuss with the President who is an experienced administrator and politician. It is pertinent to mention that Vohra was the first person without Army or intelligence background to occupy the gubernatorial post in the state after a gap of 18 years. Jagmohan was there for a brief period who demitted office in 1990 and was replaced by army & intelligence officers like former RAW chief Girish Chandra Saxena, Gen. K V Krishna Rao (retd) and Gen. S K Sinha. 

Thursday, September 8, 2016

Come back oh, charkha

by Harish Gupta, National Editor, Lokmat Group

If you are running marathon but joined the race an hour or so late, it is likely that you will reach the final post 26 miles away some time. But the competition will certainly close before that. A similar fallacy is staring India. When government"s financial data were released last week, and it was found that the Gross Domestic Product (GDP) had grown 7.1 per cent in the April-June quarter, against 7.9 per cent in the last quarter of the previous fiscal, there was dismay and consternation all around.

Wednesday, August 31, 2016

A costly injunction

by Harish Gupta, National Editor, Lokmat Group

The current logjam on higher judicial appointments has affected the entire judicial system. Its impact on the 28 high courts is grave. These courts of appeal in the states are particularly in the crisis zone with about half the sanctioned posts of judges lying vacant while four million cases are pending. Those to whom justice is delayed are mostly ordinary people, including many who are detained and awaiting trial, and many more who complain that they have been illegally dispossessed or harmed. Obviously with such hapless victims of the judicial system's failure in mind that Chief Justice of India T.S. Thakur made a rather startling remark on Prime Minister Narendra Modi's Independence Day speech, saying, "I was hoping he (Modi) will speak about issues plaguing the justice delivery system. However, he did not. I request the government to pay attention to our judiciary, especially appointment of judges".

Friday, August 26, 2016

Modi Takes Bull by the horn

by Harish Gupta, National Editor, Lokmat Group

Former External Affairs Minister Salman Khurshid  dubbed Prime Minister Narendra Modi’s statement from the Ramparts of Red Fort on Balochistan as “Adventurism”. Former Finance Minister P Chidambaram and out-spoken Mani Shankar Aiyer were equally critical of Modi the way he  raked up PoK, Balochistan & Gilgit.

Wednesday, August 3, 2016

How the con man was conned by North Block

by Harish Gupta, National Editor, Lokmat Group

How the con man was conned by North Block
The PMO connection
• It, now, transpires that the Income Tax sleuths were surprised when they raided the Safdarjung Enclave bungalow of P N Sanyal to look for the man who used to send text SMS messages to top officers of the Central Board of Direct Taxes. 

Harish Gupta
New Delhi, Aug 3
A high-profile sex racket -- busted in Delhi last week creating ripples as it involved top businessmen, bureaucrats, politicians and others -- has a PMO connection; so it seems. It, now, transpires that the Income Tax sleuths were surprised when they raided the Safdarjung Enclave bungalow of P N Sanyal to look for the man who used to send text SMS messages to top officers of the Central Board of Direct Taxes.

Now, it transpires that he not only supplied high-end escort girls to politicians, corporate tycoons and bureaucrats but also used to get things done in government offices. He used to send text messages to CBDT top officials to get officers transferred from one place to other and other favours. The text SMS messages used to be sent in the name of Prime Minister's principal secretary Nripendra Mishra directly to the CBDT officers. Since such messages used to be for low rank officials, none cared to check and complied by replying on the mobile number: "Done Sir." But one day he wanted a commissioner rank officer to be given a plum posting. The text message landed on the mobile phone of the CBDT chairman from ostensibly Mishra's mobile. The chairman had technical difficulty in getting the order implemented and went to the higher-ups to seek advice. When Mishra was contacted, he flatly denied he had anything to do with it. Even the mobile number was not his either. The cat was out of the bag. It was then decided to sent a team of IT officials and raid his place. The case was transferred to the Delhi Police after it turned out to be the case of a smart cookie going berserk.

Sanyal was trafficking women from Central Asia and running the syndicate. But somewhere he got involved in transfers and postings too.He was found guilty of impersonation and human trafficking and collected documented proof in the form of SMSes and WhatsApp messages. The I-T officials found documents with "fake letterheads" recovered from his house to "get his work done in government offices". 


by Harish Gupta, National Editor, Lokmat Group

Tax in India has long been a matter of negotiation rather than obligation. Earlier this year, pending indirect tax disputes in concerned appellate tribunal and the high courts and Supreme Court stood at 136,365. The number was so staggering that the government was forced to find excuses to withdraw appeals in minor disputes ranging from Rs 10 lakh to Rs 15 lakh. Yet the tax revenue now frozen in disputes at various levels is well over five lakh crore of rupees. Besides, Indian companies" 'hunger' for exemption led successive regimes to succumb to make changes in to the tax laws. It has resulted in many large companies being 'zero-tax'. The country's tax administration has, over the decades, left its public finance permanently starved.

Wednesday, July 27, 2016


by Harish Gupta, National Editor, Lokmat Group

Be not afraid of greatness," goes the cliched yet profound line in The Twelfth Night, "Some are born great, some achieve greatness, and others have greatness thrust upon them."

Wednesday, July 20, 2016

GST: Still A Long Way To Go

by Harish Gupta, National Editor, Lokmat Group

It is universally accepted that a federal country like India badly needs an instrument like Goods and Services Tax (GST) if it must leave behind the colonial legacy of taxes upon taxes. The traditional practice is to tax the cycle wheel maker x% and levy y% on the complete bike, ignoring the tax upon tax on wheel. The problem was partly addressed by Value Added Tax (VAT) in 2005, but it was only partly. As VAT regulations and rates vary across the states, a tendency developed among states to undercut the rates for political gains of the parties in power.

Besides, VAT left uncovered much of the turf as it provided no tax credits for interstate transactions, nor did it apply on services. But GST, as the name indicates, covers all goods and services. Besides, it is an overarching tax that subsumes all indirect taxes under four heads, viz., VAT for intra-state sales, Central sales tax for inter-state sales, excise duty on manufacture, and service tax on all services except the exempt ones. Theoretically, it is simple and clear. And it is revenue neutral, so it will have no adverse effect on tax income of the governments.

However, what has turned GST into such a contentious subject—it will test the Modi government's capacity to get the Rajya Sabha pass the bill—is its essentially non-federal character. It is after all the job of states to manage most of the visible areas of governance, like running schools, hospitals, part-subsidizing rationing system, building roads and bridges, policing, funding the lower judiciary, etc. How well does a party in power at the state level govern its people may depend on a combination of factors, but the volume of state tax revenue is certainly one of them. The fact is, acceptance of GST implies sacrifice of the state's power to raise or lower tax rates. Beside, GST being a tax across the value chain, it hardly promises to make goods and services cheaper. So the fear of inflation dogs state politicians.

These are the reasons why BJP was opposed to GST when the Congress-led UPA government spearheaded the bill, and now that the table has turned, it is BJP which is touting it as a big-ticket reform while Congress till recently was pulling out all stops to stall it. It still is and will most probably use it as leverage against its other prickly issues with government. But now that Congress has lost the numbers and support in the upper house to rustle up a fighting majority, it is expected to be in a mood of acceptance of the GST bill. It may even compromise on its earlier stand that there must be an upper limit to GST included in the very constitutional amendment that goes with the enactment, and may finally settle for a rate band (or "ring fence") in the act. Were it to be featured in the Constitution, amending it in future would have required two-thirds majority in the parliament whereas a simple majority in the lower house is enough to amend a law. But the grumble that may take longer to fade away is due to the states' feeling that they've drawn the short straw.

It is largely a misperception for two reasons. First, GST is a dual tax of which the proceeds are divided between the Centre and the states, based on a formula that will be acceptable to both. Besides, it offers a VAT-like framework across the states, thus making it possible for individual states to act like members of the European Union (EU) and find markets outside the state boundaries at lower cost and with more ease of business. It will also reduce dodgy transactions across the economy, with its consequent salutary impact on state revenues and public morals. It is after all a fact that, prior to introduction of VAT, sales tax machineries at the state level had deteriorated to the depths of the pits. I remember in Mumbai restaurant waiters often whispered into customers' ear: Cash dijiye, parchhi chahiye to tax lagega.

Knowing state governments' sensitivities, the Centre has kept out of GST a range of items on which states are sort of addicted for their tax incomes. The excluded items from GST are: petroleum, HSD, crude oil, gas, Tobacco and, of course, liquor. Maharashtra government earned Rs 13,500 crore last year as excise duty on liquor and another Rs 8,000 crore in VAT. The general estimate is that states in India earn 20 per cent revenue from liquor. Due to over-taxation in Uttar Pradesh, liquor price is so high that booze-happy people drive all the way from Meerut to Delhi to buy their favourite brands at affordable price. Ditto with diesel or petroleum, as their prices widely vary from state to state. A large number of people from Haryana travel to Delhi and UP to get their tanks filled.

Besides, the law still has many grey areas that need to be lighted up. It is a destination based tax, not based on origin (like, say, excise duty). So it must be clearly identifiable where the goods and services are headed. This is a tricky issue with a service like, say, transmission and distribution of power, when part of the service is distributed in states other than where it is generated. It required identification of the ‘point of taxation’ in an unambiguous manner. Therefore, the electricity is also out of the GST purview, for now. But GST is clearly the way forward for the entire nation—not for the Centre alone nor for the prosperous states that produce a lot of dutiable goods and services. For its success, it only requires a world-class IT architecture, and a public awareness that good tax system and good governance are synonymous.

Tuesday, July 5, 2016

Swamy ke peeche kaun hai?

by Harish Gupta, National Editor, Lokmat Group

The name may be Bond, James Bond, but there is always an 'M' in distant London, the super-boss of the MI6, who dictates each of his moves like a puppeteer to the puppet.

Tuesday, June 28, 2016


by Harish Gupta, National Editor, Lokmat Group

After getting a bloody nose from China at the Nuclear Suppliers Group (NSG) plenary in Seoul (South Korea) last week, it is not only India’s ambition to get a foot in the door of the 48-member club that has been shattered. It has also put the red flag on Prime Minister Narendra Modi’s overreaching diplomacy. It clearly emerged that his diplomacy is high on jet miles but modest on finesse. On the eve of the plenary, the Prime Minister hopped across five capitals in four days and pressed the octogenarian President, Pranab Mukherjee, to keep pace with him across different destinations. Modi’s picture with Chinese president Xi Jinping at Tashkent, the capital of Uzbekistan, hours before the Seoul meet, made headlines in India as if the “deal” is clinched. But when the crunch came, China did not shift the breadth of a hair from its consistent position that no country staying out of Non-Proliferation Treaty (NPT) could claim NSG membership.

But it is not just that China remained frosty to Modi. Following the plenary, it appears that some countries that Modi recently visited, with an impression given that there had been a change of heart, actually proved steely in their rejection of India’s case as a non-NPT aspirant. And so were New Zealand and Austria, both regarded as US allies. Even Modi’s charm failed to swing Switzerland. Nor was there any proof that a Skype call from White House would work wonders. It seems Modi and his team was somewhat lacking in the fast-changing dynamic of power with the US no more the last word as it used to be in 2008. The US signed the civil nuclear deal with India then and gave it a one-time waiver to participate in nuclear trade with NSG countries. But even that advantage was short-lived. What was considered a feather in Manmohan Singh’s cap in 2008 under Republican Bush faded  fast by a wave of amendments made to NSG guidelines in 2011. One of them banned trade in enrichment and reprocessing with any country which is not a signatory to NPT.

Enrichment of uranium, from its natural form to the fissile isotope uranium 235 and reprocessing technology form the core of using nuclear energy for making weapon as well as generating electricity. By banning transfer of enrichment and reprocessing technology, the 2011 amendments virtually negated the spirit of the 2008 Indo-US civil nuclear deal. It hinged on the US ‘trusting’ India that it would not stoop to divert fissile fuel from power reactors to making nuclear weapons. The amendments came after President Barack Obama had taken charge in the US, after President George W. Bush. There was no protest from Washington against NSG amendments, which again suggests a marked loss of real interest in the US in the treaty with India signed by the previous Republican presidency.

Added to that is the irresistible rise of China as a global superpower, a fact that the Modi administration failed to factor in while thinking it has got US support in its pocket. Modi visited the US four times after becoming prime minister, but it was China that correctly plumbed the depth of Indo-US relations and knew America wouldn’t raise hell if it stopped India at the NSG door. In stark contrast, when the Indian Army liberated Bangladesh from Pakistan in 1971, the US, then Pakistan’s godfather, got its Seventh Fleet sailing down to the Bay of Bengal yet it did not fire a single shot as it was fully aware of the former Soviet Union’s commitment to Indira Gandhi. Developing real close ties with the US, or any big power, for that matter, is certainly more challenging that holding its leader in a bear hug, or sitting with him on a swing in one’s home state. Diplomacy is a lot more than just photo-op.

Besides, the one-time waiver that President Bush had gifted to India was good enough for the moment as it enabled India to lawfully shop around for advanced reactors from Russia, US, France, Japan or Britain for peaceful purposes. Of course these will be under international safeguards. But where is the problem if we are not pinching plutonium from them to make weapons? Of what value is NSG membership then, other than gaining respectability?

The drive shown by Modi in foreign policy could be better employed, perhaps, in winning friends at home. His government is into its third year but, barring liberalization of FDI, there is not a single mega reform initiated. Of course, Modi is trying his best to simplify procedures and rules. But can the posterity will remember his regime in the same way as the Narasimha Rao-Manmohan Singh regime is remembered for ending the “licence permit raj”. The effect of Modi’s dramatic clinching of majority in the lower House in 2014 is fading away in the wake of a bitter row between Arun Jaitley, his finance minister and confidante, and maverick MP Subramaniam Swamy. Though Modi’s own graph remains high. But his government’s image is taking a beating due to various domestic factors.

The drive and energy Modi has displayed in foreign relations, though admirable per se, were better invested if he had won back the party, including the sullen faces that enjoy his trusted finance minister’s public humiliation. That alone would have won him the trophy of GST a year ago, making possible seamless trade on almost uniform tariff across a nation of 28 states. It is as bold a reform as abolition of licence-permit raj, and certainly more honourable than jetting across the planet to finally have the door of NSG slammed on the face.

Monday, June 20, 2016

Uranium problem? Thorium solution

by Harish Gupta, National Editor, Lokmat Group

India's nuclear malady is a spin-off from global politics. After 2004, it became clear that, for evolved democracies like the US, it is no longer possible to send troops to foreign lands, the political price of even a single citizen's life being unbearably high. So, with the US troop withdrawal from Afghanistan in the background, the American leadership began paying a lot of attention to fixing the riddle canon that is South Asia, and specially that of India.

Thursday, June 16, 2016

Rahul Gandhi elevation deferred again

by Harish Gupta, National Editor, Lokmat Group


Rahul Gandhi elevation deferred again

No AICC session for now

New Delhi, June 14

The anointment of Rahul Gandhi as Congress president is understood to have been delayed again; so it seems. Though clamour for Rahul's elevation is growing in the party. But it has now been delayed again. 

Highly placed sources in the Congress say that the AICC session to elevate party’s vice president to the president’s post, will not be held at least for the next two months.

“The AICC session may now be held sometime in August end or September,” said a senior party functionary on the condition of anonymity.

These sources say that no useful purpose will be served by elevating Rahul Gandhi as he is already taking major decisions in the party. What Rahul Gandhi has lately realized that the team he trusted during the past two years did not deliver. Madhusudan Mistry who was even rewarded with a Rajya Sabha seat failed to infuse confidence within the UP unit of the party. The bitter battle with the BJP and other parties is being fought in UP and Mistry was unable to coordinate with Prashant Kishore, Rahul’s strategist.

The return of Ghulam Nabi Azad as incharge of UP and Kamal Nath for Haryana and Punjab signals that Rahul had to fall back on Sonia Gandhi’s loyalists only.

Rahul has realized that the Haryana Congress unit is in disarray particularly after the huge set back in the Rajya Sabha polls. He also  knows that party will be crippled without Bhupinder Singh Hooda who was Chief Minister for ten years. Though it is clear that 13 MLAs allegedly close to Hooda used a different marker pen to cast their votes. But the situation has to be retrieved.

Since Kamal Nath has never been Rahul Gandhi favourite  and had been dumped by him during the past two years, his sudden rehabilitation signals that Sonia Gandhi is playing more active role.

Kamal Nath is senior to Hooda and rather had helped him when the latter needed him. Similarly, Kamal Nath will have to keep Capt Amrinder Singh under check. He becomes uncontrollable. Kamal Nath has been his Doon school buddy and original Rajiv Gandhi era friends. The high command is aware that Congress is capable of winning Punjab and doesn’t want to wither away the prospects.

These sources say more changes may be in store in the party and general secretary C P Joshi who handled Assam elections may be given another responsibility. It seems that the party wants to focus on ensuing Assembly polls in five states early next year rather than elevating one Gandhi with another.

Tuesday, June 14, 2016

Good-bye, hesitations of history

by Harish Gupta, National Editor, Lokmat Group

Narendra Modi, after being elected Prime Minister two years ago, finished his fourth visit to the US last week amid an impressive address to a joint session of the US Congress; he was the sixth Indian leader after Jawaharlal Nehru to be accorded the honour. It was topped up with a reception in his honour by the Senate and House foreign relations committees and the India Caucuses in the House and the Senate. This being the election year in America, Barack Obama, the outgoing President, who struck up a good personal rapport with Modi, the duo have certainly taken the Indo-US relations to a hitherto unachieved height. It goes well beyond the "strategic partnership", to an emotional level where one friend understands the difficulties of the other. In his address to US Congress, Modi tellingly said that "our relations have overcome the hesitations of history", and "through the cycles of elections and transitions of Administrations the intensity of our engagement has only grown".

Tuesday, June 7, 2016


by Harish Gupta, National Editor, Lokmat Group

So it looks like the time for Rahul Gandhi has arrived! There are two reasons why it cannot wait anymore. First, though the Congress has given a general impression of stolidity after its recent defeat in Kerala and Assam, the mood of its senior leaders is unpredictable. After Assam, a wave of exodus from the party is in the offing in various states. In Chhattisgarh, the exit of Ajit Jogi signals a grave development for the Congress.

A further twist to the plot came with veteran leader Digvijaya Singh speaking of the need for a “deep surgery” in the party. Its a metaphor that, in the context of Congress party, can only imply an alleged dysfunction in its reigning ‘family’. It got the party so rattled that Kamal Nath, a politician known to hold his cards close to his chest, readily appeared on a Karan Thapar TV interview to erase the notion that there could really be something amiss in the party. There is no possibility of a “surgery”, Nath reassured and Rahul Gandhi would take charge of the party in “due course”.

It is clear that the party does not have much time on hand. Elections to Uttar Pradesh, Uttarakhand, Punjab, Manipur and Goa fall due early next year, and with that will the curtain be rung up for the general elections in 2019. While all the five states going to poll next year are crucial, Uttar Pradesh is the bellwether for the two so-called national parties, BJP and Congress, as it represents the heart of north India. In the south, accounting for 131 of India’s 543 Lok Sabha seats, state parties seem firmly in the saddle everywhere except in Kerala, where too the Congress seems in terminal disarray. In east India, BJP is far from blooming; its recent electoral victory in Assam hinged on the support of regional groups. Elsewhere, politics is strictly regional, be it in Bihar, Odisha, West Bengal and the smaller NE states. And, with a power vacuum emerging in both Congress and BJP across western India, the contest actually boils down to the battle for Uttar Pradesh. In 2014, Narendra Modi grabbed 73 Lok Sabha seats in the state because his doughty campaign, and over-arching appeal that rose above castes (though not communities). Though his success was limited in eastern and southern India, he won most of the Lok Sabha seats as he could conquer the north Indian roadblock of caste. In Uttar Pradesh Modi’s candidates won the votes of both Mayawati and Mulayam Singh Yadav in large numbers. It was much like the triumph of Indira Gandhi in 1971 or Rajiv Gandhi in 1985—the two other elections in recent times where votes were cast in response to a sense of national exigency.

If Congress has to return to power in 2019, its moment of truth is now. It must test if a member of its ‘first family’ is capable of creating, across a mini-India like Uttar Pradesh, the same over-arching appeal as in 1971, 1985 or 2014. If the experiment succeeds then, from a shockingly low of 44 as in 2014, it can hope to recover to 200 or even more. But numbers short of that can at best raise coalition hopes. It’s of little use as BJP can easily beat it at the game, given the huge resources at its command. In 2004, the government of Atal Bihari Vajpayee lost power as, after the Gujarat riots of 2002, other parties deserted BJP. Modi regained Vajpayee’s baton decade later by appealing directly to the people, not to political bosses with a war chest unheard of in electoral history.

The Congress has only two cards: Rahul Gandhi and Priyanka Vadra. Is Rahul competent to ride a wave of hope and dreams? Party elders are not sure, whatever they may say in public as loyal followers of the ‘high command’.  Rahul and Amarinder Singh were not on the best of terms till the other day, but now Singh is suddenly back in Rahul’s favour. The party vice president had ignored the sober advice of many Kerala leaders to remove corruption-tainted Oomen Chandy and octogenarian Tarun Gogoi in Assam from chief minister’s post. But he did not listen, and the lapse cost his party dearly and reignited the BJP with a win in  Assam. The blunder was costly for the Congress. But Rahul remains unruffled as he feels politics is a wheel and what goes up has to come down. Modi sold dreams in 2014 and he cannot repeat the same in 2019. He is bent upon cleansing his own party and wants to run it like a corporate house. He believes that there is no permanent “loyalty” in politics. He is willing to wait for a longer time that what political pundits think, five years or even ten years. But his ageing Party leaders are in a hurry.   

Therefore, the clamour for Priyanka is mounting.  It is no wonder that BJP has sniffed it right and working hard for a “Congress (read Family) Mukt Bharat”. The BJP is digging up Robert Vadra’s alleged links with an land and arms dealers. In the Uttar Pradesh election, if the coin flips in Priyanka’s favour, it should be the forerunner of the Grand Old Party being on the march with a new icon, that of Priyanka Gandhi, whom many old-timers compare to her illustrious grandmother, at least in her looks. It’s a different matter that Rahul is not giving up.

Be it Priyanka or Rahul, either of the Gandhi children,  they cannot be pinned down to any major caste or community group. The Gandhis will therefore carry a larger gamut of following than BJP as they are ready to play a second fiddle to like-minded regional parties.

Tuesday, May 31, 2016


by Harish Gupta, National Editor, Lokmat Group

Only two years are past since the installation of the NDA government led by Narendra Modi. It is therefore distinctly premature to pass a judgment. Some governments begin well but get miserably clogged up half way through, like it happened with the second UPA government piloted by Manmohan Singh. It dived headfirst into an unending cesspool of corruption charges, and got terminally tainted. On the other hand, the Rajiv Gandhi-led government began in 1985 amid great euphoria, until rumour of corruption in defence deals became so shrill that every attempt by the government to silence it seemed phoney and the prime minister’s name became mud.

Modi seems to have learnt lessons from the above example, and his promise of “Congress mukt” India is actually a commitment to keep his administration free from the stench of corruption. Unlike Manmohan Singh, Modi is a hands-on PM. Perhaps, this is the reason why there has been no charge of financial depravity in any of the ministries till now. To ensure that the clean image of his administration sustains, Modi has been particularly insistent on transparent e-auction of the natural resources, be it coal, oil or natural resources.

But a prime minister is not rated high simply if he keeps his nose clean. Modi has sparks of originality that marks him out from his contemporaries. Jan Dhan Yojana is an example. On the face of it, it is a simple plan to give a bank account to every unbanked poor. It is another matter that 21.43 crore such accounts have been created under the JDY scheme in less than two years, with the share of ‘zero-balance’ (therefore, nominal) being 27 per cent and falling. But the idea is not to turn the poor Indian into saver overnight. It is rather a financial architecture for direct transfer of all future state subsidies and grants, thus eliminating the pressure of middlemen that has plagued welfare since Independence.

In a sense, Modi is truly a Gujarati trader at heart and understands the importance of cost-cutting through disintermediation. His idea of Digital India and Smart City as well as Smart Village may sound nebulous. But, when completed, they are all about transforming Indian business from the old chaupal, and the gaggles of middlemen, to transparent and speedy transactions in real time. In India, Bengaluru, Hyderabad and Gurugram came up not due to any governmental thinking but because telecommunication became faster and cheaper so an opportunity arose for Indians to do offshore maintenance jobs. Modi, with his digital thrust, now wants to turn this opportunity into a bold new venture, with a programme like ‘Make in India’.  Samsung the Korean giant, is now setting up a unit in Noida near Delhi to make a line of its mobile phones. Recently, when Timothy Cook, chief of Apple, visited India and met Modi, he was clearly told that he could launch Apple Stores in India if only he used some (30%) made-in-India products. In fact, most foreign IT biggies, including Microsoft Corporation and Cisco Systems, have of late increased their manpower and investments in India. Huwaei, the Chinese telecoms major, has started a research & development centre in Bengaluru. That Modi puts his finger on the economy shows in his MUDRA scheme for financing six crore small vendors and businessmen, 61 per cent of whom are minorities, SC, ST or OBC. Maybe he could relate to their condition, being a tea seller at a railway station once.

Modi can think and dream big. He has persuaded Airbus Industries of France and the Tata Group to begin collaboration on design and manufacture of a military transport aircraft. Airbus has already begun manufacturing some of its parts in India. These are the first green shoots of high-tech industry in India, a sector in which India lags not only behind the Asian major powers like Japan, Korea and China but newcomers like Thailand and Vietnam. To facilitate entry of high technology, FDI cap on defence industries has been pushed up to 49 per cent and Indian firms like L&T, assigned to make nuclear submarines, are potential conduits for transfer of sophisticated technology.

Some of the things that outwardly appear to be Modi’s mere fads, like yoga, for that matter, are actually smart ideas to improve public health at low cost, and creating jobs. In this year so far the government of Haryana has given jobs to 25,000 persons as yoga instructors. Similarly, his Namami Ganga scheme for cleaning up North India’s arterial river, for which a budget of Rs 20,000 crore is allocated, should create a chain of municipal waste disposal projects along the river. It is a national renewal scheme on an unprecedented scale with a huge potential of creating jobs.

In his first two years, if his conduct seems somewhat puzzling, it is in his silence about the mindless outbursts of his party’s fringe elements. Their missiles are not always limited to a bigoted version of art and culture, or ancient history of their choice. Despite Modi, as it appears, Subramanian Swamy, a machinator par excellence and newly appointed BJP member of the Rajya Sabha, is firing salvos at RBI Governor Raghuram Rajan on trumped up charges. When Rajan was under attack from the finance ministry for his stubbornness and refusing to reduce interest rates, Modi had stepped in April last year saying he is a good teacher. But this time Modi has preferred to practically remain non-committal on the controversy. He may be upset with Rajan for not reducing interest rates for high growth despite low inflation. Modi cannot remain maun  like his predecessor Manmohan Singh and is nor an “accidental prime minister” either.  His has pressed the pause button in terms of launching new schemes and  fully focussed on implementing programs already launched as next coming two years are crucial for him to establish that he is not an accidental choice.