Is Shahzad Chaudhry Right "On India"?

[Riaz Haq]

The Pakistan Air Force's Retired Air Vice Marshal Shahzad Chaudhry has recently penned an op-ed for The Express Tribune newspaper calling on his country to make peace with India. He argues that "India is relevant to the world", implying that Pakistan is not. Chaudhry believes that the "gap between Pakistan and India is now unbridgeable".  Chaudhry concludes his piece with the following recommendation: "It is time to recalibrate our policy towards India and be bold enough to create a tri-nation consensus, along with China, focusing on Asia to be the spur for wider economic growth and benefit".

Prime Minister Indian PM Modi Boasts of Having "56 inch Chest"

History of India-Pakistan Peace Talks:

While I completely support Chaudhry's call for Pakistan to make peace with India, I do wonder why India's Hindu Supremacist Prime Minister Narendra Modi would even seriously entertain such a thought if "India is relevant to the world" and Pakistan is not? And if Modi does agree to talks, what kind of peace would come out of such talks?  Would it be similar to Bangladesh-India peace based on client-patron relationship? Retired senior Indian officials like Shyam Saran and AS Dulat have blamed Indian security establishment for past failures to reach a peace deal with Pakistan. 

I also question Chaudhry's idea of creating "a tri-nation consensus" with India and China. Why would China agree to such an arrangement while both Asian giants are seeking to establish regional hegemony? Why wouldn't China pursue its own version of Monroe Doctrine in Asia? 

Let me expand on the above two points about "relevance" of India and Pakistan and "tri-nation consensus" with China. 

Pakistan's Global Relevance:

Chaudhry argues that "India is relevant to the world". So is Pakistan. Indian Prime Minister Narendra Modi's government has pursued a policy of internationally isolating Pakistan for the last 8 years. Indian diplomats and mainstream media have engaged in a concerted campaign to hurt Pakistan diplomatically and economically during this period. Even the sport of cricket has not been spared.  All of the available evidence suggests that this Indian campaign has failed.  

Pakistan PM with Other World Leaders at SCO Summit in Samarkand, Uz...

A prominent Indian journalist Shekhar Gupta has recently summarized the reasons for the Modi government's failure to achieve its objectives relative to Pakistan. Gupta argues that Pakistan is too important to be ignored or isolated by the international community. He says, "Pakistan is too big in terms of population, too powerful militarily, too Muslim, too nuclear and too well located to be isolated". 

Pakistan PM Shahbaz Sharif with President and Mrs. Biden. Source: White House

Here are some of the key points Shekhar Gupta makes in episode 1093 of his show Cut The Clutter : 

1.Pakistan is our most important neighbor. We must focus on Pakistan.

2, We can not ignore Pakistan in India because the world can not ignore Pakistan

3. The Western world has an intrinsic relationship with Pakistan which doesn't go away

4. The West does not see Pakistan as so useful to them today and yet Pakistan can not be isolated.

5. You can see all the indications that Pakistan is not isolated.

6. A lot of (Indian) TV channels say Pakistan is isolated but the evidence doesn't support it.

7. Pakistan FM visited Washington and met his counterpart Tony Blinken. 

8. Pakistan Army Chief has received a warm welcome at the US Defense Dept and met US Defense Secretary Lloyd Austin. Bajwa matters more than the Pakistan Defense Minister. Nobody knows his name.

9. US Ambassador to Pakistan Donald Blome, a career diplomat, has visited "Pakistan Occupied Kashmir" and called it Azad Kashmir...Azad means free.

10. When the chips are down in the region Pakistan is the ally Americans reach out to.

11. The US does not want Pakistan to drift to China.

12. German foreign minister Annalena Baerbock has spoken about Kashmir...the K word. She has asked for the UN to help solve the Kashmir issue.

13. Pakistan Army Chief General Bajwa is not a warmonger. He wants to normalize ties with India. He wants to trade with India. He doesn't want Faiz Hameed to succeed him. He used to be the ISI chief and took credit for the Taliban victory in Afghanistan. Do the Americans have leverage here?

14. Where does Pakistan's unique power come from? Why can't Pakistan be ignored? Why can't Pakistan be isolated?

15. The Indian public needs to understand it.

16. Pakistan is too big in terms of population, too powerful militarily, too Muslim, too nuclear and too well located to be isolated.

17. Pakistan has the 5th largest population and its population is growing fast. It could soon exceed Indonesia to become the largest Muslim nation in the world.

18. Pakistan has the 5th strongest military in the world.

19. In terms of nuclear weapons, Pakistan has the 4th largest nuclear arsenal in the world.

20. Pakistan is too well located to be isolated. It has a geo-strategic location. Pakistan is the western gateway to China. Pakistan opened China's ties with the US. And then helped the US defeat the Soviet Union.

21. The factors that made Pakistan such a strong ally to the US still exist. Don't blame the Pakistanis for it.

22. India is not willing to commit to an alliance with the US.

23. Imran Khan tried to change Pakistan's foreign policy to be more like India's but he failed.

Tri-nation Consensus:

Prime Minister Modi's revocation of Article 370 and annexation of Jammu and Kashmir as Indian union territories have angered not just Pakistan but also China. Modi's actions are not only an affront to the people of Jammu and Kashmir but also in clear violation of India's international and bilateral obligations under United Nations charter and the Simla Accord. China, a permanent member of the United Nations Security Council, lays claim to the Ladakh region. It has objected to India making it a union territory.

Since Modi's annexation of disputed territories of Jammu, Kashmir and Ladakh, China has dramatically stepped up pressure on India in Ladakh. China has increased its troop presence, killed and injured dozens of Indian soldiers and taken at least a thousand kilometers of territory claimed by India. As a result, India has had to move troops from the line of control (LoC) with Pakistan to the Line of Actual Control (LAC) with China. 

Indian Congress Party leader Rahul Gandhi summarized the situation well when he said, "China has taken our land. They are beating out soldiers. The threat of China Is clear. And the government is hiding it, ignoring it. China is preparing for an offensive in Ladakh and Arunachal. And the government of India is sleeping". 

 

India-Bangladesh Ties:

 

India's relations with Bangladesh are essentially patron-client relations. This fact became amply clear when Bangladeshi Prime Minister Shaikh Hasina recently visited New Delhi to seek political and economic assistance from the Indian Prime Minister Narendra Modi. 

 

Modi-Hasina Delhi summit was preceded by Bangladesh Foreign Minister Abdul Momen's trip to India where he said,  "I've requested Modi government to do whatever is necessary to sustain Sheikh Hasina's government".  Upon her return from India, Sheikh Hasina told the news media in Dhaka, "They (India) have shown much sincerity and I have not returned empty handed". It has long been an open secret that Indian intelligence agency RAW helped install Shaikh Hasina as Prime Minister of Bangladesh, and her Awami League party rely on New Delhi's support to stay in power. Bangladesh Foreign Minister Abdul Momen has described India-Bangladesh as one between husband and wife. In an interview with Indian newspaper 'Ajkal,' he said, "Relation between the both countries is very cordial. It's much like the relationship between husband and wife. Though some differences often arise, these are resolved quickly."  Both Bangladeshi and Indian officials have reportedly said that Sheikh Hasina "has built a house of cards". 

India-Pakistan Gap: 

There's no question that Pakistan is in the midst of a major economic crisis. The country's economic performance is dismal right now. At the same time, it must be acknowledged that Pakistan, with its youngest population in Asia, has a bright future ahead if its leaders can resolve the internal political situation. 

Pakistan Population Youngest Among Major Asian Nations. Source: Nik...

In fact, Goldman Sachs analysts Kevin Daly and  Tadas Gedminas project Pakistan's economy to grow to become the world's sixth largest by 2075.  In a research paper titled "The Path to 2075", the authors forecast Pakistan's GDP to rise to $12.7 trillion with per capita income of $27,100.  India’s GDP in 2075 is projected at $52.5 trillion and per capita GDP at $31,300.  Bangladesh is projected to be a $6.3 trillion economy with per capita income of $31,000.  By 2075, China will be the top global economy, followed by India 2nd, US 3rd, Indonesia 4th, Nigeria 5th and Pakistan 6th. The forecast is based primarily on changes in the size of working age populations over the next 50 years.  

GDP Ranking Changes Till 2075. Source: Goldman Sachs Investment Res...

 

Economic Growth Rate Till 2075. Source: Goldman Sachs Investment Re...

Economic Impact of Slower Population Growth: 

Daly and Gedminas argue that slowing population growth in the developed world is causing their economic growth to decelerate. At the same time, the economies of the developing countries are driven by their rising populations.  Here are four key points made in the report:

 1) Slower global potential growth, led by weaker population growth. 

2) EM convergence remains intact, led by Asia’s powerhouses. Although real GDP growth has slowed in both developed and emerging economies, in relative terms EM growth continues to outstrip DM growth.

3) A decade of US exceptionalism that is unlikely to be repeated. 

4) Less global inequality, more local inequality. 

Demographic Dividend: 

With rapidly aging populations and declining number of working age people in North America, Europe and East Asia, the demand for workers will increasingly be met by major labor exporting nations like Bangladesh, China, India, Mexico, Pakistan, Russia and Vietnam. Among these nations, Pakistan is the only major labor exporting country where the working age population is still rising faster than the birth rate. 

Over 10 million Pakistanis are currently working/living overseas, according to the Bureau of Emigration. Before the COVID19 pandemic hit in 2020,  more than 600,000 Pakistanis left the country to work overseas in 2019. Nearly 700,000 Pakistanis have already migrated in this calendar year as of October, 2022. The average yearly outflow of Pakistani workers to OECD countries (mainly UK and US) and the Middle East was over half a million in the last decade. 

Consumer Markets in 2030. Source: WEF

World's 7th Largest Consumer Market:

Pakistan's share of the working age population (15-64 years) is growing as the country's birth rate declines, a phenomenon called demographic dividend. With its rising population of this working age group, Pakistan is projected by the World Economic Forum to become the world's 7th largest consumer market by 2030. Nearly 60 million Pakistanis will join the consumer class (consumers spending more than $11 per day) to raise the country's consumer market rank from 15 to 7  by 2030. WEF forecasts the world's top 10 consumer markets of 2030 to be as follows: China, India, the United States, Indonesia, Russia, Brazil, Pakistan, Japan, Egypt and Mexico.  Global investors chasing bigger returns will almost certainly shift more of their attention and money to the biggest movers among the top 10 consumer markets, including Pakistan.  Already, the year 2021 has been a banner year for investments in Pakistani technology startups. 

India's Kautilya Doctrine: 

“Every neighboring state is an enemy and the neighboring state's neighbor is a friend.”  ― Kautilya, The Arthashastra

The name of Kautilya, meaning crooked, is invoked by former Indian foreign secretary Shyam Saran's book “How India Sees the World: Kautilya to the 21st Century”.  This invocation of Kautilya in the title of the book makes the above quote about "neighboring state is an enemy" particularly relevant to how Indian policymakers like Shyam Saran see Pakistan and Afghanistan. 

 

Kautilya presented a theory of international relations called the “circle of states,” or Rajamandala. It says hostile states are those that border the ruler’s state, forming a circle around it. In turn, states that surround this set of hostile states form another circle around the circle of hostile states. This second circle of states can be considered the natural allies of the ruler’s state against the hostile states that lie between them. Put more succinctly, “the enemy of my enemy is my friend.”  

 

Pakistanis like AVM Shahzad Chaudhry must understand that India's foreign policy has always been and continues to be guided by the Kautilya Doctrine. 

 

Related Links:
Haq's Musings

South Asia Investor Review

Ex Indian Diplomat Sabharwal on Pakistan's "Resilience", "Strategic...

Modi's Size Illusion

Modi's Kashmir Blunder

Who's to Blame For Prior Failures to Reach India-Pakistan Peace Deal?

Why Has Modi Failed to Isolate Pakistan?

Pakistan Projected to Become World's 6th Largest Economy by 2075

Pakistan Projected to Be 7th Largest Consumer Market By 2030

Ambassador Kishore Mahbubani: America Does Not Respect India

US Brackets Modi With Murderous Dictators

Obama: Quickest Route to Indian Unity is Expressing Hostility Towar...

Riaz Haq's Youtube Channel

PakAlumni: Pakistani Social Network

[Riaz Haq]

#India Has Lost Access to 26 Of 65 Patrol Points In Eastern #Ladakh to #China. This report was filed at last week's annual conference of the country's top police officers in #Delhi, attended by PM #Modi and #AmitShah. #Kashmir #Pakistan #Article370 https://www.ndtv.com/india-news/india-has-lost-presence-in-26-of-65...

India has lost access to 26 of 65 patrolling points in Eastern Ladakh, a report by a senior police officer in the union territory has said, in a worrying new disclosure amid the country's standoff with China at various flashpoints along their tottery 3,500-km frontier.
"Presently there are 65 PPs (Patrolling Points) starting from Karakoram pass to Chumur which are to be patrolled regularly by the ISFs (Indian Security Forces). Out of 65 PPs, our presence is lost in 26 PPs (i.e. PP no. 5-17, 24-32, 37, due to restrictive or no patrolling by the ISFs," PD Nitya, the Superintendent of Police of Leh, Ladakh's main city, wrote according to the research paper accessed by NDTV.

The report was filed at last week's annual conference of the country's top police officers in Delhi, attended by Prime Minister Narendra Modi, Union Home Minister Amit Shah and National Security Advisor Ajit Doval.

"Later on, China forces us to accept the fact that as such areas have not seen the presence of ISFs or civilians since long, the Chinese were present in these areas. This leads to a shift in the border under control of ISFs towards Indian side and a "buffer zone" is created in all such pockets which ultimately leads to loss of control over these areas by India. This tactic of PLA (China's People's Liberation Army) to grab land inch-by-inch is known as 'Salami slicing'," it said.

"PLA has taken advantage of the buffer areas in the de-escalation talks by placing their best of cameras on the highest peaks and monitoring the movement of our forces... they object our movement even in the buffer zone, claiming it to be 'their' area of operation and then further ask us to move back to create more 'buffer' areas," the officer wrote.

She said this Chinese strategy was seen in Galwan Valley, the site of a deadly clash in 2020 when 20 Indian troops and at least four Chinese soldiers died in hand-to-hand fighting.

Ms Nitya also said that marking areas as out of bounds and keeping them barren affects troop morale as well. "During an interaction with one senior officer whose unit is based right on forward area, he shared that, if by retreating 400 metres back, we can buy peace with PLA for 4 years, then it's worth it," the report said.

The government is yet to comment on the disclosure. Speaking to The Hindu newspaper, which first reported the police officer's research paper, a defence source countered its assertions, saying "there is no loss of territory due to disengagement in friction areas".

"Some areas have been restricted for patrolling for both sides pending diplomatic resolution of disputes. No pasture lands have been lost. In disengaged areas, we have as many cameras and technical means as the PLA and hence dominate the area as much, if not more," the newspaper quoted the source as saying.

They said the military was "encouraging and providing all facilities", in conjunction with the civilian administration, to allow locals and their cattle in grazing locations.

The report comes just over a month after India accused China of trying to "unilaterally change the status quo" on their de-facto border, known as the Line of Actual Control, when clashes left troops on both sides injured.

The December 9 incident in Arunachal Pradesh was seen as the most serious face-off since the Galwan Valley clash in 2020 which led to a sharp escalation in hostilities between the two countries. A series of military talks since then have led to a careful pullback of troops on both sides.

[Riaz Haq]

69% Pakistanis feel that their children will have a better life than them in a global Gallup International survey in 64 countries

Figure in India is 43%

https://twitter.com/bilalgilani/status/1619768586276569088?s=20&...



https://www.gallup-international.bg/en/46667/fsdfdsfs/


The most positive country among those surveyed is Nigeria (90% minus 6%) and the most negative is Slovenia a (14% minus 53%). Among the prominent countries where GIA could poll, expectations for their children’s future are highest in Nigeria is followed by Russia (52% minus 10%), Mexico (48% minus 30%), the USA (43% minus 31%) and India (43% minus 33%).

When combining the two questions, another perspective is added. For instance, Moldova shows a total of 86 (45% saying that their live is worse life than the one of their parents plus 41% expecting a worse life of today’s children), followed in this negative ranking by North Macedonia (82: 35% negative assessments plus 47% negative predictions), Afghanistan (81), Syria and Italy (78), etc.

Most of the countries are still positive on both questions, but if one looks for instance for countries with both above 50% positive answers, Nigeria stands out with 171 (81% positive for today plus 90% positive for tomorrow), followed by Kosovo (162), the United Arab Emirates (150), Ghana (141), Pakistan (134), etc.

Findings are proved, confirming that developing parts of the world share more hope. National and political peculiarities leave their footprint but in general is seems that the closer the war and troubles are, the worse are the answers on both issues – as expected.

---------

Every second citizen (51%) of the world believes that their life is better than that of their parents. The other half of the people asked is equally divided between those who assess a worse life (23%) and those who find it the same (23%). 3% could not answer. Satisfaction with the living standard is a key factor for people to believe that they have a better life than their parents. But in some rich regions like Europe this is not so valid.

Expectations for the life of today’s children are predominantly good as well but lower than the comparison of own life to the life of the previous generation – 44% are expecting a better life for today’s children in comparison to our lives, 28% expecting a worse life, 20% expecting about the same and 8% not responding. Aged people are less sure about the better future of the next generation. More money unsurprisingly seems to result in more confidence in the future on a personal level, but on a national level countries that experience or used to experience difficulties are the ones to believe stronger in better future for the next generation. Unsurprisingly again.

[Riaz Haq]

ISLAMABAD/LAHORE/KARACHI:
Despite the fact that the country is facing various economic challenges, including a looming default and spiraling inflation, surveys conducted by The Express Tribune in three major cities disclosed that even though the people were aware of the financial hardships, they just wanted to carry on living their lives normally.

https://tribune.com.pk/story/2397409/pakistanis-weighed-down-by-inf...

“The prices have increased to a certain extent but that doesn’t mean that the people will stop eating,” Ali, who runs a burger stall in Islamabad, said.

“We are working as usual. The prices of fuel and electricity have witnessed an unusual hike and the government should do something about it,” he added.

Ali maintained that the rising prices had not significantly affected his business.

“My shop is packed with customers like before,” he claimed.

Shahnawaz Satti, a tandoor owner, said the increase in the prices of fuel and flour had no effect on his business as he jacked up the rates of his naans and rotis in accordance with that.

Adeel, a citizen, told The Express Tribune that the political instability in the country could lead the country towards defaulting on its external repayments.

He noted that all political stakeholders would have to sit together and chalk out a strategy to avert this situation.

“If the government concedes to all conditions imposed by the IMF (International Monetary Fund), the price of petroleum products would exceed Rs400 per litre. This might not affect the rich but will choke the life out of the common people,” he observed.

The survey found that the people were not bothered by the threat of default, but they wanted their lives to continue as per their normal routine.

In Lahore, a city renowned for its festivities and liveliness, normalcy is slowly changing its pace as the economic crisis has made its presence known in every aspect of life.

While various segments of the city's residents still braving the deteriorating economic conditions during the tenure of the PTI government, its successor, the Pakistan Democratic Movement (PDM), failed to bring about the relief it promised when it assumed charge in April last year.

Ever since, matters have been gradually heading towards decay, and with no respite expected soon, there is a sense of disappointment lingering in the air.

Read ‘IMF, privatisation not a solution’

Lahore, which bristled with life, is now slowly becoming accustomed to lonely streets and closed markets at 10pm -- an hour relatively earlier by the city’s standards.

Recently, the authorities extended the time restrictions imposed on commercial markets, with the exception of pharmacies and other essential services, to save energy.

Pakistan, which already suffers from a serious energy crisis, is trying to make lifestyle adjustments to cut the fuel import bill as the country has run out of its dollar reserves to back its valuable imports.

On the surface of it, the decision to close markets early may appear to be an unwise one, but it is an extension of the “difficult measures” that the government says it has been taking to steer the country out of the economic crisis.

However, despite the incumbent government's tall claims, the situation is still unstable – the effects of which can be felt in everyday life in the city.

The Express Tribune spoke to people from various segments of the society to develop a clearer picture of how things really were.

The lowest segments of society have been hit the hardest by the economic crisis as they struggle to make ends meet, with the prices of essential items increasing faster than their income.

They complain about hefty utility bills despite low usage, unaffordable prices of essential commodities, lack of social protection and their struggle to maintain their income.

Those from various strata of the middle class echoed similar concerns as the economic crisis has made it significantly difficult for them to maintain their

[Riaz Haq]

The Wire
@thewire_in

After S. Jaishankar said that India cannot pick a fight with China because the latter has a bigger economy, military veterans have accused the Narendra Modi government of having a "defeatist attitude" and "bowing down to a bully".

https://thewire.in/security/veterans-criticise-jaishankar-china


New Delhi: After external affairs minister S. Jaishankar said that India cannot pick a fight with China because the latter has a bigger economy, military veterans have accused the Narendra Modi government of having a “defeatist attitude” and “bowing down to a bully”.

In a podcast with ANI editor-in-chief Smita Prakash on Wednesday, Jaishankar said: “Look, they (China) are the bigger economy. What am I going to do? As a smaller economy, I am going to pick up a fight with the bigger economy? It is not a question of being reactionary, it’s a question of common sense….”

He added that India and China have an agreement not to bring large number of troops to the border, and asked if India should violate that agreement.

Former Navy chief Arun Prakash, a veteran of the 1971 war, tweeted: “If relative size of economies is seen as arbiter of int’l relations, how come nations like Cuba, N Korea & Iran thumb their noses at the USA or Vietnam at China? India, as a democracy, nuclear weapon state & significant economic & mil power must stand firm against hegemony.”



Major General Shail Jha (retired) tweeted: “Mr Jaishankar should know that its not India but China which is picking the fight.”



The veteran added: “Economy or no economy, if we bow down to a bully, we are abandoning our self-respect. Is it acceptable? What a shame. And the guy is being hailed as the greatest FM. It’s cowardice.”



Speaking to The Telegraph, a former lieutenant general said Jaishankar’s statement was “shocking” and was reminiscent of “unconditional surrender”.

“What happened to the so-called muscular nationalism that this government projects in election speeches? Modi’s self-declared muscular nationalism has now capitulated to Chinese aggression and bullying,” the veteran said.

Speaking about Chinese intrusions across the Line of Actual Control (LAC), the veteran told the newspaper that instead of “asking the Chinese troops to retreat”, the “New India under Modiji agreed to create buffer zones within Indian territories in eastern Ladakh as part of the disengagement agreement, thus ceding further territory to China



A retired colonel said Jaishankar’s “defeatist statement” spoke volumes about Modi’s China policy. “Where is Mr 56-inch Modi’s muscular nationalism when it comes to China?” the former colonel asked.

[Riaz Haq]

Is #India ready to take #China’s place in global #economy? That’s just wishful thinking. India’s modest economic size, challenging #investment environment and substandard #infrastructure are major deterrents to fruitful collaboration. #Modi #Hindutva https://www.scmp.com/comment/opinion/article/3213475/india-ready-ta...


by Sameer Basha


India has been increasingly viewed as a natural ally to countries like Australia, which see it as an economic and military counterweight to China. They believe the best way for this to happen is through foreign direct investment into the country, to allow for a gradual transition of enterprises from China to India.
In its 2022 Investment Climate Statement on India, the US State Department called the country “a challenging place to do business” and highlighted its protectionist measures, increased tariffs and an inability to adjust from “Indian standards” to international standards.
The 2023 Index of Economic Freedom ranks India 131st in the world and 27th out of 39 economies in the Asia-Pacific region. The Indian government places equity limits on foreign capital in some sectors of the economy. In these sectors, according to the government’s circular of its FDI policy, beyond the cap imposed on foreign ownership, the entity must be “owned by/held with/in the hands of resident Indian citizens and Indian companies, owned and controlled by resident Indian citizens”.
In addition, ambiguities in the tax code have meant companies like Vodafone, Cairn Energy and GE Capital have found themselves in the cross hairs of tax authorities, putting into question India’s maturity as an FDI hub.
Such actions have seen India’s FDI inflows, as a share of the global total, fall from 3.4 per cent to 2.8 per cent between 2019 and 2021, whereas China’s share has have risen from 14.5 per cent to 20.3 per cent. In recent years, companies like Harley-Davidson and the Royal Bank of Scotland have either downsized or exited India, with German retailer Metro AG selling its operations after two decades in the country.
When one compares the relative size of their economies, China had a nominal gross domestic product of US$17.7 trillion in 2021, while India’s was US$3.2 trillion. India invests only 30 per cent of its GDP, compared with 50 per cent for China; and 20 per cent of its economy comes from manufacturing, as opposed to 30 per cent of China.
Investing in a domestic network of roads, airports, seaports and rail lines, as well as streamlining FDI regulations, allows China to move its products from factories to consumers efficiently, making it an attractive prospect for investment. That is not to mention the world-class infrastructure that has transformed the urban landscapes of both old and new cities within the country.
Despite India’s economic progress, poverty is still a defining feature in its sprawling metropolises. Former Reserve Bank of India governor Raghuram Rajan has also weighed in on the India-China competition, stating: “The argument that India will replace China is very premature as India is a much smaller economy as of now.”
Unfortunately, India is not currently in a place to deliver on the expectations placed on it by countries like Australia, which remain stuck in a geopolitical gambit with China. Simply banking on its large population is a fickle way of viewing the options amid a decoupling from China’s economy. India is still decades away from realising its true potential.
The two countries’ goals also differ. China is transforming itself into a technologically driven economy in order to exceed the potential of the US. In contrast, India is attempting to position itself as a market-driven economy utilising its large population as a manufacturing base to compete with China.

[Riaz Haq]

Adani’s business empire may or may not turn out to be the largest con in corporate history. But far greater dangers to civic morality, let alone democracy and global peace, are posed by those peddling the gigantic hoax of Modi’s India. Pankaj Mishra


https://amp.theguardian.com/commentisfree/2020/dec/19/home-office-r...

Modi has counted on sympathetic journalists and financial speculators in the West to cast a seductive veil over his version of political economy, environmental activism and history. ‘I’d bet on Modi to transform India, all of it, including the newly integrated Kashmir region,’ Roger Cohen of the New York Times wrote in 2019 after Modi annulled the special constitutional status of India’s only Muslim-majority state and imposed a months-long curfew. The CEO of McKinsey recently said that we may be living in ‘India’s century’. Praising Modi for ‘implementing policies that have modernised India and supported its growth’, the economist and investor Nouriel Roubini described the country as a ‘vibrant democracy’. But it is becoming harder to evade the bleak reality that, despoiled by a venal, inept and tyrannical regime, ‘India is broken’ – the title of a disturbing new book by the economic historian Ashoka Mody.

The number of Indians who sleep hungry rose from 190 million in 2018 to 350 million in 2022, and malnutrition and malnourishment killed nearly two-thirds of the children who died under the age of five last year. At the same time, Modi’s cronies have flourished. The Economist estimates that the share of billionaire wealth in India derived from cronyism has risen from 29 per cent to 43 per cent in six years. According to a recent Oxfam report, India’s richest 1 per cent owned more than 40.5 per cent of its total wealth in 2021 – a statistic that the notorious oligarchies of Russia and Latin America never came close to matching. The new Indian plutocracy owes its swift ascent to Modi, and he has audaciously clarified the quid pro quo. Under the ‘electoral bond’ scheme he introduced in 2017, any business or special interest group can give unlimited sums of money to his party while keeping the transaction hidden from public scrutiny.

Modi also ensures his hegemony by forging a public sphere in which sycophancy is rewarded and dissent harshly punished. Adani last year took over NDTV, a television news channel that had displayed a rare immunity to hate speech, fake news and conspiracy theories. Human Rights Watch has detailed a broad onslaught on democratic rights: ‘the Hindu nationalist Bharatiya Janata Party (BJP)-led government used abusive and discriminatory policies to repress Muslims and other minorities’ and ‘arrested activists, journalists and other critics of the government on politically motivated criminal charges, including of terrorism’. Last month, as the BJP’s official spokesperson denounced the BBC as ‘the most corrupt organisation in the world’, tax officials launched a sixty-hour raid on the broadcaster’s Indian offices in apparent retaliation for a two-part documentary on Modi’s role in anti-Muslim violence.

Also last month, the opposition leader Rahul Gandhi was expelled from parliament to put a stop to his persistent questions about Modi’s relationship with Adani. Such actions are at last provoking closer international scrutiny of what Modi calls the ‘mother of democracy’, though they haven’t come as a shock to those who have long known about Modi’s lifelong allegiance to Rashtriya​ Swayamsevak Sangh, an organisation that was explicitly inspired by European fascist movements and culpable in the assassination of Mohandas Gandhi in 1948.

[Riaz Haq]

Vulnerable employment, total (% of total employment) (modeled ILO estimate) - Pakistan, India | Data


Bangladesh 54%

Pakistan 54%

India 74%

https://data.worldbank.org/indicator/SL.EMP.VULN.ZS?locations=PK-IN-BD


------------

Sandeep Manudhane
@sandeep_PT
Why the size of the economy means little
a simple analysis

1) We are often told that India is now a $3.5 trillion economy. It is growing fast too. Hence, we must be happy with this growth in size as it is the most visible sign of right direction. This is the Quantity is Good argument.

2) We are told that such growth can happen only if policies are right, and all engines of the GDP - consumption, exports, investment, govt. consumption - are doing their job well. We tend to believe it.

3) We are also told that unless GDP grows, how can Indians (on average) grow? Proof is given to us in the form of 'rising per capita incomes' of India. And we celebrate "India racing past the UK" in GDP terms, ignoring that the average Indian today is 20 times poorer than the average Britisher.

4) All this reasoning sounds sensible, logical, credible, and utterly worth reiterating. So we tend to think - good, GDP size on the whole matters the most.

5) Wrong. This is not how it works in real life.

6) It is wrong due to three major reasons
(a) Distribution effect
(b) Concentration of power effect
(c) Inter-generational wealth and income effect

7) First comes the distribution effect. Since 1991, the indisputable fact recorded by economists is that "rich have gotten richer, and poor steadily stagnant or poorer". Thomas Piketty recorded it so well he's almost never spoken in New India now! Thus, we have a super-rich tiny elite of 2-3% at the top, and a vast ocean of stagnant-income 70-80% down below. And this is not changing at all. Do not be fooled by rising nominal per capita figures - factor in inflation and boom! And remember - per capita is an average figure, and it conceals the concentration.

8) Second is the Concentration of power effect. RBI ex-deputy governor Viral Acharya wrote that just 5 big industrial groups - Tata, Birlas, Adanis, Ambanis, Mittals - now disproportionately own the economic assets of India, and directly contribute to inflation dynamics (via their pricing power). This concentration is rising dangerously each year for some time now, and all government policies are designed to push it even higher. Hence, a rising GDP size means they corner more and more and more of the incremental annual output. The per capita rises, but somehow magically people don't experience it in 'steadily improving lives'.

9) Third is the Inter-generational wealth and income effect. Ever wondered why more than 90% of India is working in unstructured, informal jobs, with near-zero social security? Ever wondered why rich families smoothly pass on 100% of their assets across generations while paying zero taxes? Ever wondered how taxes paid by the rich as a per cent of their incomes are not as high as those paid by you and me (normal citizens)? India has no inheritance tax, but has a hugely corporate-friendly tax regime with many policies tailor-made to augment their wealth. Trickle down is impossible in this system. But that was the spiel sold to us in 1991, and later, each year! There is no incentive for giant corporates (and rich folks) to generate more formal jobs, as an ocean of underpaid slaves is ready to slog their entire lives for them. Add to that automation, and now, AI systems!

SUMMARY
Sadly, as India's GDP grows in size, it means little for the masses because trickle-down is near zero. That is because new formal jobs aren't being generated at scale at all (which in itself is a big topic for analysis).
So, our Quantity of GDP is different from Quality of GDP.


https://twitter.com/sandeep_PT/status/1675421203152896001?s=20

[Riaz Haq]

The West needs to get real about India | The Strategist

https://www.aspistrategist.org.au/the-west-needs-to-get-real-about-...


by John McCarthy, ex Australian Ambassador to India

The first is that India’s economic promise—particularly as an eventual rival to China—is overblown.

Doubts about the extent of India’s promise have been around for a couple of decades—in fact, ever since some commentators started suggesting that India would one day outstrip China.

These doubts were cogently expressed by Harvard academic Graham Allison in a recent essay in Foreign Policy. Allison, inter alia, suggested that we need to reflect on several ‘inconvenient truths’:

We have been wrong in the past about the pace of the rise of India—namely in the early 1990s and the middle of the first decade of this century.
India’s economy is much smaller than China’s—and the gap has increased, not decreased. In the early 2000s, China’s GDP was two to three times as large as India’s. It is now roughly five times as large.
India has been falling behind in the development of science and technology to power economic growth. China spends 2% of GDP on research and development, compared with India’s 0.7%. On artificial intelligence, the figures are startling. For example, China holds 65% of AI patents, while India holds just 3%.
China’s workforce is more productive than India’s. The quality of their respective workforces is affected by poverty and nutrition levels. As one example, according to the 2022 UN State of Food Security and Nutrition in the World report, 16.3% of India’s population was undernourished in 2019–2021 compared with less than 2.5% of China’s population.
The second argument is that India’s worldview is quite different to that of most Western countries.

India rightly sees itself as a force in international affairs. It aspires to be a powerful pole in a multipolar world. It adheres to a doctrine of strategic autonomy. It is guided by what it thinks is best for India, not by alliances or what others want of it.

India’s China-driven strategic congruence with the US is not the same as a quasi-alliance relationship. India doesn’t operate within a framework of mutual obligation. It doesn’t expect others to come to its aid and it won’t join someone else’s war.

In a recent Foreign Affairs article entitled ‘America’s bad bet on India’, an American academic of Indian origin, Ashley Tellis, argues that New Delhi would never involve itself in any US confrontation with China that did not threaten its own security.

The Tellis piece has weight because he was a main intellectual force behind the ‘nuclear deal’ concluded in 2008.
--------

The problem is that Modi’s government can only lend itself to highly qualified identification with democratic principles.

Elections in India are generally fair, and Modi’s sway is vigorously contested by the main opposition party, by Congress and by regional parties. That’s good.

However, Modi remains an unabashed Hindu supremacist whose political machine largely disregards the aspirations of Muslims and other minorities. It reacts vengefully to criticism and scores badly on most of the international indexes that measure democratic freedoms. To some, India is an illiberal democracy; to others, it’s an electoral autocracy. But, for sure, it is not a liberal democracy.

Western interests dictate that we put grunt into our relationship with India with energy and determination. It is unquestionably an increasingly important country. But we must have realistic expectations of India and deal with as it is, not as we might like it to be. Otherwise, we risk disappointment.